SGC GUARANTY
This GUARANTY is entered into as of April 14, 1998 by SANTA FE
GAMING CORPORATION (formerly Sahara Gaming Corporation), a Nevada corporation
("GUARANTOR"), in favor of and for the benefit of SUNAMERICA LIFE INSURANCE
COMPANY, as collateral agent for and representative of (in such capacity
herein called "REPRESENTATIVE") the holders of the Notes from time to time
("HOLDERS") and, subject to subsection 3.7, for the benefit of the other
Beneficiaries (as hereinafter defined).
RECITALS
A. Santa Fe Hotel Inc., a Nevada corporation ("COMPANY"), and
Guarantor have entered into that certain Note Purchase Agreement dated as of
April 14, 1998 with SunAmerica Life Insurance Company and Credit Suisse First
Boston Mortgage Capital LLC (said Note Purchase Agreement, as it may
hereafter be amended, supplemented or otherwise modified from time to time,
being the "NOTE PURCHASE AGREEMENT"; capitalized terms defined therein and
not otherwise defined herein being used herein as therein defined).
B. Guarantor owns all the capital stock of Company and will
benefit from the transactions contemplated by the Basic Documents.
C. It is a condition precedent to the acquisition of the Notes
under the Note Purchase Agreement that Company's obligations thereunder be
guarantied by Guarantor.
D. Guarantor is willing irrevocably and unconditionally to
guaranty such obligations of Company.
NOW, THEREFORE, based upon the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and in order to induce Holders and Representative to enter into
the Note Purchase Agreement and to acquire the Notes thereunder, Guarantor
hereby agrees as follows:
SECTION 1. DEFINITIONS
1.1 CERTAIN DEFINED TERMS. As used in this Guaranty, the following
terms shall have the following meanings unless the context otherwise requires:
"BENEFICIARIES" means Representative and Holders.
"GUARANTIED OBLIGATIONS" has the meaning assigned to that term in
subsection 2.1.
"GUARANTY" means this Guaranty dated as of April 14, 1998, as it
may be amended, supplemented or otherwise modified from time to time.
1
"PAYMENT IN FULL," "PAID IN FULL" or any similar term means payment in
full of the Guarantied Obligations, including without limitation all
principal, interest, costs, fees and expenses (including, without
limitation, reasonable legal fees and expenses) of Beneficiaries as
required under the Basic Documents.
1.2 INTERPRETATION. References to "Sections" and "subsections" shall
be to Sections and subsections, respectively, of this Guaranty unless
otherwise specifically provided. In the event of any conflict or
inconsistency between the terms, conditions and provisions of this Guaranty
and the terms, conditions and provisions of the Note Purchase Agreement, the
terms, conditions and provisions of this Guaranty shall prevail.
SECTION 2. THE GUARANTY
2.1 GUARANTY OF THE GUARANTIED OBLIGATIONS. Guarantor hereby
irrevocably and unconditionally guaranties, as primary obligor and not merely
as surety, the due and punctual payment in full of all Guarantied Obligations
when the same shall become due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including amounts
that would become due but for the operation of the automatic stay under
Section 362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)). The term
"GUARANTIED OBLIGATIONS" is used herein in its most comprehensive sense and
includes:
(a) any and all Obligations of Company now or hereafter made, incurred
or created, whether absolute or contingent, liquidated or unliquidated,
whether due or not due, and however arising under or in connection with the
Note Purchase Agreement and the other Basic Documents, including those
arising under successive borrowing transactions under the Note Purchase
Agreement which shall either continue the Obligations of Company or from
time to time renew them after they have been satisfied and including
interest which, but for the filing of a petition in bankruptcy with respect
to Company, would have accrued on any Guarantied Obligations, whether or
not a claim is allowed against Company for such interest in the related
bankruptcy proceeding; and
(b) those expenses set forth in subsection 2.7 hereof.
2.2 PAYMENT BY GUARANTOR; APPLICATION OF PAYMENTS. Guarantor hereby
agrees, in furtherance of the foregoing and not in limitation of any other
right which any Beneficiary may have at law or in equity against Guarantor by
virtue hereof, that upon the failure of Company to pay any of the Guarantied
Obligations when and as the same shall become due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including amounts that would become due but for the operation of
the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C.
Section 362(a)), Guarantor will upon demand pay, or cause to be paid, in
cash, to Representative for the ratable benefit of Beneficiaries, an amount
equal to the sum of the unpaid principal amount of all Guarantied Obligations
then due as aforesaid, accrued and unpaid interest on such Guarantied
Obligations (including, without limitation, interest which, but for the
filing of a petition in bankruptcy
2
with respect to Company, would have accrued on such Guarantied Obligations,
whether or not a claim is allowed against Company for such interest in the
related bankruptcy proceeding) and all other Guarantied Obligations then owed
to Beneficiaries as aforesaid. All such payments shall be applied promptly
from time to time by Representative:
FIRST, to the payment of the costs and expenses of any collection or
other realization under this Guaranty, including reasonable compensation to
Representative and its agents and counsel, and all expenses, liabilities
and advances made or incurred by Representative in connection therewith;
SECOND, to the payment of all other Guarantied Obligations in such
order as Representative shall elect pursuant to Section 2.5A(ii) of the
Note Purchase Agreement; and
THIRD, after payment in full of all Guarantied Obligations, to the
payment to Guarantor, or its successors or assigns, or to whomsoever may be
lawfully entitled to receive the same or as a court of competent
jurisdiction may direct, of any surplus then remaining from such payments.
2.3 LIABILITY OF GUARANTOR ABSOLUTE. Guarantor agrees that its
obligations hereunder are irrevocable, absolute, independent and
unconditional and shall not be affected by any circumstance which constitutes
a legal or equitable discharge of a guarantor or surety other than payment in
full of the Guarantied Obligations. In furtherance of the foregoing and
without limiting the generality thereof, Guarantor agrees as follows:
(a) This Guaranty is a guaranty of payment when due and not of
collectibility.
(b) Representative may enforce this Guaranty upon the occurrence of
an Event of Default under the Note Purchase Agreement.
(c) The obligations of Guarantor hereunder are independent of the
obligations of Company under the Basic Documents, and a separate action or
actions may be brought and prosecuted against Guarantor whether or not any
action is brought against Company or any other guarantors and whether or
not Company is joined in any such action or actions.
(d) Payment by Guarantor of a portion, but not all, of the Guarantied
Obligations shall in no way limit, affect, modify or abridge Guarantor's
liability for any portion of the Guarantied Obligations which has not been
paid. Without limiting the generality of the foregoing, if Representative
is awarded a judgment in any suit brought to enforce Guarantor's covenant
to pay a portion of the Guarantied Obligations, such judgment shall not be
deemed to release Guarantor from its covenant to pay the portion of the
Guarantied Obligations that is not the subject of such suit, and such
judgment shall not, except to the extent satisfied by Guarantor, limit,
affect,
3
modify or abridge Guarantor's liability hereunder in respect of the
Guarantied Obligations.
(e) Any Beneficiary, upon such terms as it deems appropriate, without
notice or demand and without affecting the validity or enforceability of
this Guaranty or giving rise to any reduction, limitation, impairment,
discharge or termination of Guarantor's liability hereunder, from time to
time may (i) renew, extend, accelerate, increase the rate of interest on,
or otherwise change the time, place, manner or terms of payment of the
Guarantied Obligations; (ii) settle, compromise, release or discharge, or
accept or refuse any offer of performance with respect to, or substitutions
for, the Guarantied Obligations or any agreement relating thereto and/or
subordinate the payment of the same to the payment of any other
obligations; (iii) request and accept other guaranties of the Guarantied
Obligations and take and hold security for the payment of this Guaranty or
the Guarantied Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guarantied
Obligations, any other guaranties of the Guarantied Obligations, or any
other obligation of any Person (including any other guarantor) with respect
to the Guarantied Obligations; (v) enforce and apply any security now or
hereafter held by or for the benefit of such Beneficiary in respect of this
Guaranty or the Guarantied Obligations and direct the order or manner of
sale thereof, or exercise any other right or remedy that such Beneficiary
may have against any such security, in each case as such Beneficiary in its
discretion may determine consistent with the Note Purchase Agreement and
any applicable security agreement, including foreclosure on any such
security pursuant to one or more judicial or nonjudicial sales, whether or
not every aspect of any such sale is commercially reasonable, and even
though such action operates to impair or extinguish any right of
reimbursement or subrogation or other right or remedy of Guarantor against
Company or any security for the Guarantied Obligations; and (vi) exercise
any other rights available to it under the Basic Documents.
(f) This Guaranty and the obligations of Guarantor hereunder shall be
valid and enforceable and shall not be subject to any reduction,
limitation, impairment, discharge or termination for any reason (other than
payment in full of the Guarantied Obligations), including without
limitation the occurrence of any of the following, whether or not Guarantor
shall have had notice or knowledge of any of them: (i) any failure or
omission to assert or enforce or agreement or election not to assert or
enforce, or the stay or enjoining, by order of court, by operation of law
or otherwise, of the exercise or enforcement of, any claim or demand or any
right, power or remedy (whether arising under the Basic Documents, at law,
in equity or otherwise) with respect to the Guarantied Obligations or any
agreement relating thereto, or with respect to any other guaranty of or
security for the payment of the Guarantied Obligations; (ii) any
rescission, waiver, amendment or modification of, or any consent to
departure from, any of the terms or provisions (including without
limitation provisions relating to events of default) of the Note Purchase
Agreement, any of the other Basic Documents or any agreement or instrument
executed pursuant thereto, or of any other
4
guaranty or security for the Guarantied Obligations or any agreement
relating to such other guaranty or security; (iii) the Guarantied
Obligations, or any agreement relating thereto, at any time being found
to be illegal, invalid or unenforceable in any respect; (iv) the
application of payments received from any source (other than payments
received pursuant to the other Basic Documents or from the proceeds of
any security for the Guarantied Obligations, except to the extent such
security also serves as collateral for Indebtedness other than the
Guarantied Obligations) to the payment of Indebtedness other than the
Guarantied Obligations, even though any Beneficiary might have elected
to apply such payment to any part or all of the Guarantied Obligations;
(v) any Beneficiary's consent to the change, reorganization or
termination of the corporate structure or existence of Company or any of
its Subsidiaries and to any corresponding restructuring of the
Guarantied Obligations; (vi) any failure to perfect or continue
perfection of a security interest in any collateral which secures any of
the Guarantied Obligations; (vii) any defenses, set-offs or
counterclaims which Company may allege or assert against any Beneficiary
in respect of the Guarantied Obligations, including but not limited to
failure of consideration, breach of warranty, payment, statute of
frauds, statute of limitations, accord and satisfaction and usury; and
(viii) any other act or thing or omission, or delay to do any other act
or thing, which may or might in any manner or to any extent vary the
risk of Guarantor as an obligor in respect of the Guarantied Obligations.
2.4 WAIVERS BY GUARANTOR. Guarantor hereby waives, for the benefit of
Beneficiaries:
(a) any right to require any Beneficiary, as a condition of payment
or performance by Guarantor, to (i) proceed against Company, any other
guarantor of the Guarantied Obligations or any other Person, (ii) proceed
against or exhaust any security held from Company, any such other guarantor
or any other Person, (iii) proceed against or have resort to any balance of
any deposit account or credit on the books of any Beneficiary in favor of
Company or any other Person, or (iv) pursue any other remedy in the power
of any Beneficiary whatsoever;
(b) any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of Company including, without
limitation, any defense based on or arising out of the lack of validity or
the unenforceability of the Guarantied Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability
of Company from any cause other than payment in full of the Guarantied
Obligations;
(c) any defense based upon any statute or rule of law which provides
that the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal;
5
(d) any defense based upon any Beneficiary's errors or omissions in
the administration of the Guarantied Obligations, except behavior which
amounts to bad faith;
(e) (i) any principles or provisions of law, statutory or otherwise,
which are or might be in conflict with the terms of this Guaranty and any
legal or equitable discharge of Guarantor's obligations hereunder, (ii) the
benefit of any statute of limitations affecting Guarantor's liability
hereunder or the enforcement hereof, (iii) any rights to set-offs,
recoupments and counterclaims, and (iv) promptness, diligence and any
requirement that any Beneficiary protect, secure, perfect or insure any
security interest or lien or any property subject thereto;
(f) notices, demands, presentments, protests, notices of protest,
notices of dishonor and notices of any action or inaction, including
acceptance of this Guaranty, notices of default under the Note Purchase
Agreement or any agreement or instrument related thereto, notices of any
renewal, extension or modification of the Guarantied Obligations or any
agreement related thereto, notices of any extension of credit to Company
and notices of any of the matters referred to in subsection 2.3 and any
right to consent to any thereof; and
(g) any defenses or benefits that may be derived from or afforded by
law which limit the liability of or exonerate guarantors or sureties, or
which may conflict with the terms of this Guaranty, including without
limitation the provisions of Nevada Revised Statutes Sections 40.430-
40.459, 40.475 and 40.485 as permitted by Nevada Revised Statutes Section
40.495, and any successor provisions.
2.5 CERTAIN CALIFORNIA LAW WAIVERS. As used in this subsection 2.5, any
reference to "the principal" includes Company, and any reference to "the
creditor" includes each Beneficiary. In accordance with Section 2856 of the
California Civil Code:
(a) Guarantor agrees to withhold the exercise of any and all rights
of subrogation, reimbursement and contribution against Company, against any
other guarantor of any of the Guarantied Obligations and against any
collateral or security granted by any such other guarantor for any of the
Guarantied Obligations until the Guarantied Obligations shall have been
paid in full, all as more fully set forth in subsection 2.6;
(b) Guarantor waives any and all other rights and defenses available
to Guarantor as against any Beneficiary by reason of Sections 2787 to 2855,
inclusive, 2899 and 3433 of the California Civil Code except to the extent
expressly provided herein, including without limitation any and all rights
or defenses Guarantor may have by reason of protection afforded to the
principal with respect to any of the Guarantied Obligations, or to any
other guarantor of any of the Guarantied Obligations with respect to any of
such guarantor's obligations under its guaranty, in either case pursuant to
the antideficiency or other laws of the State of California limiting or
6
discharging the principal's indebtedness or such guarantor's obligations,
including without limitation Section 580a, 580b, 580d, or 726 of the
California Code of Civil Procedure; and
(c) Guarantor waives all rights and defenses arising out of an
election of remedies by the creditor, even though that election of
remedies, such as a nonjudicial foreclosure with respect to security for
any Guarantied Obligation, has destroyed Guarantor's rights of subrogation
and reimbursement against the principal by the operation of Section 580d of
the Code of Civil Procedure or otherwise; and even though that election of
remedies by the creditor, such as nonjudicial foreclosure with respect to
security for an obligation of any other guarantor of any of the Guarantied
Obligations, has destroyed Guarantor's rights of contribution against such
other guarantor.
No other provision of this Guaranty shall be construed as limiting the
generality of any of the covenants and waivers set forth in this subsection 2.5.
In accordance with subsection 3.6 below, this Guaranty shall be governed by, and
shall be construed and enforced in accordance with, the internal laws of the
State of Nevada, without regard to conflicts of laws principles. This
subsection 2.5 is included solely out of an abundance of caution, and shall not
be construed to mean that any of the above-referenced provisions of California
law are in any way applicable to this Guaranty or to any of the Guarantied
Obligations.
2.6 GUARANTOR'S RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Until the
Guarantied Obligations shall have been paid in full, Guarantor shall withhold
exercise of (a) any claim, right or remedy, direct or indirect, that Guarantor
now has or may hereafter have against Company or any of its assets in connection
with this Guaranty or the performance by Guarantor of its obligations hereunder,
in each case whether such claim, right or remedy arises in equity, under
contract, by statute, including without limitation under Nevada Revised Statutes
Section 40.475 or 40.485 as permitted by Nevada Revised Statutes Section 40.495
(1993), under common law or otherwise and including without limitation (i) any
right of subrogation, reimbursement or indemnification that Guarantor now has or
may hereafter have against Company, (ii) any right to enforce, or to participate
in, any claim, right or remedy that any Beneficiary now has or may hereafter
have against Company, and (iii) any benefit of, and any right to participate in,
any collateral or security now or hereafter held by any Beneficiary, and (b) any
right of contribution Guarantor may have against any other guarantor of any of
the Guarantied Obligations. Guarantor further agrees that, to the extent the
agreement to withhold the exercise of its rights of subrogation, reimbursement,
indemnification and contribution as set forth herein is found by a court of
competent jurisdiction to be void or voidable for any reason, any rights of
subrogation, reimbursement or indemnification Guarantor may have against Company
or against any collateral or security, and any rights of contribution Guarantor
may have against any such other guarantor, shall be junior and subordinate to
any rights any Beneficiary may have against Company, to all right, title and
interest any Beneficiary may have in any such collateral or security, and to any
right any Beneficiary may have against such other guarantor. Representative, on
behalf of Beneficiaries, may use, sell or dispose of any item of collateral or
security as it sees fit
7
without regard to any subrogation rights Guarantor may have, and upon any
such disposition or sale any rights of subrogation such Guarantor may have
shall terminate. If any amount shall be paid to Guarantor on account of any
such subrogation, reimbursement or indemnification rights at any time when
all Guarantied Obligations shall not have been paid in full, such amount
shall be held in trust for Representative on behalf of Beneficiaries and
shall forthwith be paid over to Representative for the benefit of
Beneficiaries to be credited and applied against the Guarantied Obligations,
whether matured or unmatured, in accordance with the terms hereof.
2.7 EXPENSES. Guarantor agrees to pay, or cause to be paid, on demand,
and to save Beneficiaries harmless against liability for, any and all costs
and expenses (including reasonable fees and disbursements of counsel and
reasonable allocated costs of internal counsel) incurred or expended by any
Beneficiary in connection with the enforcement of or preservation of any
rights under this Guaranty.
2.8 CONTINUING GUARANTY. This Guaranty is a continuing guaranty and
shall remain in effect until all of the Guarantied Obligations shall have
been paid in full. Guarantor hereby irrevocably waives any right to revoke
this Guaranty as to future transactions giving rise to any Guarantied
Obligations.
2.9 AUTHORITY OF GUARANTOR OR COMPANY. It is not necessary for any
Beneficiary to inquire into the capacity or powers of Guarantor or Company or
the officers, directors or any agents acting or purporting to act on behalf
of any of them.
2.10 FINANCIAL CONDITION OF COMPANY. Any extensions of credit may be
granted to Company or continued from time to time without notice to or
authorization from Guarantor regardless of the financial or other condition
of Company at the time of any such grant or continuation. No Beneficiary
shall have any obligation to disclose or discuss with Guarantor its
assessment, or Guarantor's assessment, of the financial condition of Company.
Guarantor has adequate means to obtain information from Company on a
continuing basis concerning the financial condition of Company and its
ability to perform its obligations under the Basic Documents, and Guarantor
assumes the responsibility for being and keeping informed of the financial
condition of Company and of all circumstances bearing upon the risk of
nonpayment of the Guarantied Obligations. Guarantor hereby waives and
relinquishes any duty on the part of any Beneficiary to disclose any matter,
fact or thing relating to the business, operations or conditions of Company
now known or hereafter known by any Beneficiary.
2.11 RIGHTS CUMULATIVE. The rights, powers and remedies given to
Beneficiaries by this Guaranty are cumulative and shall be in addition to and
independent of all rights, powers and remedies given to Beneficiaries by
virtue of any statute or rule of law or in any of the other Basic Documents
or any agreement between Guarantor and any Beneficiary or Beneficiaries or
between Company and any Beneficiary or Beneficiaries. Any forbearance or
failure to exercise, and any delay by any Beneficiary in exercising, any
right, power or remedy hereunder shall not impair any such right, power or
remedy or be construed to be a waiver thereof, nor shall it preclude the
further exercise of any such right, power or remedy.
8
2.12 BANKRUPTCY; POST-PETITION INTEREST; REINSTATEMENT OF GUARANTY. (a)
So long as any Guarantied Obligations remain outstanding, Guarantor shall
not, without the prior written consent of Representative in accordance with
the terms of the Note Purchase Agreement, commence or join with any other
Person in commencing any bankruptcy, reorganization or insolvency proceedings
of or against Company. The obligations of Guarantor under this Guaranty
shall not be reduced, limited, impaired, discharged, deferred, suspended or
terminated by any proceeding, voluntary or involuntary, involving the
bankruptcy, insolvency, receivership, reorganization, liquidation or
arrangement of Company or by any defense which Company may have by reason of
the order, decree or decision of any court or administrative body resulting
from any such proceeding.
(b) Guarantor acknowledges and agrees that any interest on any
portion of the Guarantied Obligations which accrues after the commencement of
any proceeding referred to in clause (a) above (or, if interest on any
portion of the Guarantied Obligations ceases to accrue by operation of law by
reason of the commencement of said proceeding, such interest as would have
accrued on such portion of the Guarantied Obligations if said proceedings had
not been commenced) shall be included in the Guarantied Obligations, because
it is the intention of Guarantor and Beneficiaries that the Guarantied
Obligations which are guarantied by Guarantor pursuant to this Guaranty
should be determined without regard to any rule of law or order which may
relieve Company of any portion of such Guarantied Obligations. Guarantor
will permit any trustee in bankruptcy, receiver, debtor in possession,
assignee for the benefit of creditors or similar person to pay
Representative, or allow the claim of Representative in respect of, any such
interest accruing after the date on which such proceeding is commenced.
(c) In the event that all or any portion of the Guarantied
Obligations are paid by Company, the obligations of Guarantor hereunder shall
continue and remain in full force and effect or be reinstated, as the case
may be, in the event that all or any part of such payment(s) are rescinded or
recovered directly or indirectly from any Beneficiary as a preference,
fraudulent transfer or otherwise, and any such payments which are so
rescinded or recovered shall constitute Guarantied Obligations for all
purposes under this Guaranty.
2.13 NOTICE OF EVENTS. As soon as Guarantor obtains knowledge thereof,
Guarantor shall give Representative written notice of any condition or event
which has resulted in (a) a material adverse change in the financial
condition of Guarantor or Company or (b) a breach of or noncompliance with
any term, condition or covenant contained herein or in the Note Purchase
Agreement, any other Basic Document or any other document delivered pursuant
hereto or thereto.
2.14 SET OFF. In addition to any other rights any Beneficiary may have
under law or in equity, if any amount shall at any time be due and owing by
Guarantor to any Beneficiary under this Guaranty, such Beneficiary is
authorized at any time or from time to time, without notice (any such notice
being hereby expressly waived), to set off and to appropriate and to apply
any and all deposits (general or special, including but not limited to
Indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any
9
other Indebtedness of such Beneficiary owing to Guarantor and any other
property of Guarantor held by any Beneficiary to or for the credit or the
account of Guarantor against and on account of the Guarantied Obligations and
liabilities of Guarantor to any Beneficiary under this Guaranty.
SECTION 3. MISCELLANEOUS
3.1 SURVIVAL OF WARRANTIES. All agreements, representations and
warranties made herein shall survive the execution and delivery of this
Guaranty and the other Basic Documents and any increase in the amount of the
Notes or other Obligations under the Note Purchase Agreement.
3.2 NOTICES. Any communications between Representative and Guarantor
and any notices or requests provided herein to be given may be given by
mailing the same, postage prepaid, or by telex, facsimile transmission or
cable to each such party at its address set forth in the Note Purchase
Agreement, on the signature pages hereof or to such other addresses as each
such party may in writing hereafter indicate. Any notice, request or demand
to or upon Representative or Guarantor shall not be effective until received.
3.3 SEVERABILITY. In case any provision in or obligation under this
Guaranty shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction,
shall not in any way be affected or impaired thereby.
3.4 AMENDMENTS AND WAIVERS. No amendment, modification, termination or
waiver of any provision of this Guaranty, and no consent to any departure by
Guarantor therefrom, shall in any event be effective without the written
concurrence of Representative and, in the case of any such amendment or
modification, Guarantor against whom enforcement of such amendment or
modification is sought. Any such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which it was given.
3.5 HEADINGS. Section and subsection headings in this Guaranty are
included herein for convenience of reference only and shall not constitute a
part of this Guaranty for any other purpose or be given any substantive
effect.
3.6 APPLICABLE LAW. THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF
GUARANTOR AND BENEFICIARIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEVADA, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
3.7 SUCCESSORS AND ASSIGNS. This Guaranty is a continuing guaranty and
shall be binding upon Guarantor and its respective successors and assigns.
This Guaranty shall inure to the benefit of Beneficiaries and their
respective successors and assigns. Guarantor shall not assign this Guaranty
or any of the rights or obligations of Guarantor hereunder without the
10
prior written consent of all Holders. Any Beneficiary may, without notice or
consent, assign its interest in this Guaranty in whole or in part, in
accordance with Section 9.14 of the Note Purchase Agreement with respect to
an assignment by any Holder and in accordance with Section 8.7 of the Note
Purchase Agreement with respect to an assignment by the Collateral Agent.
The terms and provisions of this Guaranty shall inure to the benefit of any
transferee or assignee of any Note, and in the event of such transfer or
assignment the rights and privileges herein conferred upon such Beneficiary
shall automatically extend to and be vested in such transferee or assignee,
all subject to the terms and conditions hereof.
3.8 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST GUARANTOR ARISING OUT OF OR RELATING TO THIS
GUARANTY, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE OF NEVADA. BY EXECUTING
AND DELIVERING THIS AGREEMENT, GUARANTOR, FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III)AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN
ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, TO GUARANTOR AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH
SUBSECTION 3.2;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER GUARANTOR IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT BENEFICIARIES RETAIN THE RIGHT TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST GUARANTOR
IN THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 3.8 RELATING TO
JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST
EXTENT PERMISSIBLE.
3.9 WAIVER OF TRIAL BY JURY. GUARANTOR AND, BY ITS ACCEPTANCE OF THE
BENEFITS HEREOF, EACH BENEFICIARY EACH HEREBY AGREES TO WAIVE ITS RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
11
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY. The scope of
this waiver is intended to be all encompassing of any and all disputes that
may be filed in any court and that relate to the subject matter of this
transaction, including without limitation contract claims, tort claims,
breach of duty claims and all other common law and statutory claims.
Guarantor and, by its acceptance of the benefits hereof, each Beneficiary
each (i) acknowledges that this waiver is a material inducement for Guarantor
and Beneficiaries to enter into a business relationship, that Guarantor and
Beneficiaries have already relied on this waiver in entering into this
Guaranty or accepting the benefits thereof, as the case may be, and that each
will continue to rely on this waiver in their related future dealings and
(ii) further warrants and represents that each has reviewed this waiver with
its legal counsel, and that each knowingly and voluntarily waives its jury
trial rights following consultation with legal counsel. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING
(OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS
SUBSECTION 3.9 AND EXECUTED BY REPRESENTATIVE AND GUARANTOR), AND THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS GUARANTY. In the event of litigation, this Guaranty
may be filed as a written consent to a trial by the court.
3.10 NO OTHER WRITING. This writing is intended by Guarantor and
Beneficiaries as the final expression of this Guaranty and is also intended
as a complete and exclusive statement of the terms of their agreement with
respect to the matters covered hereby. No course of dealing, course of
performance or trade usage, and no parol evidence of any nature, shall be
used to supplement or modify any terms of this Guaranty. There are no
conditions to the full effectiveness of this Guaranty.
3.11 FURTHER ASSURANCES. At any time or from time to time, upon the
request of Representative, Guarantor shall execute and deliver such further
documents and do such other acts and things as Representative may reasonably
request in order to effect fully the purposes of this Guaranty.
3.12 COUNTERPARTS; EFFECTIVENESS. This Guaranty may be executed in any
number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original for all purposes; but all such counterparts together shall
constitute but one and the same instrument. This Guaranty shall become
effective as to Guarantor upon the execution of a counterpart hereof by
Guarantor and receipt by Representative of written or telephonic notification
of such execution and authorization of delivery thereof.
3.13 REPRESENTATIVE AS COLLATERAL AGENT.
(a) Representative has been appointed to act as Representative
hereunder by Holders. Representative shall be obligated, and shall have the
right hereunder, to make demands, to give notices, to exercise or refrain
from exercising any rights, and to take or
12
refrain from taking any action, solely in accordance with this Guaranty and
the Note Purchase Agreement.
(b) Representative shall at all times be the same Person that is
Collateral Agent under the Note Purchase Agreement. Written notice of
resignation by Collateral Agent pursuant to subsection 8.7 of the Note
Purchase Agreement shall also constitute notice of resignation as
Representative under this Guaranty; removal of Collateral Agent pursuant to
subsection 8.7 of the Note Purchase Agreement shall also constitute removal
as Representative under this Guaranty; and appointment of a successor
Collateral Agent pursuant to subsection 8.7 of the Note Purchase Agreement
shall also constitute appointment of a successor Representative under this
Guaranty. Upon the acceptance of any appointment as Collateral Agent under
subsection 8.7 of the Note Purchase Agreement by a successor Collateral
Agent, that successor Collateral Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring or
removed Representative under this Guaranty, and the retiring or removed
Representative under this Guaranty shall promptly (i) transfer to such
successor Representative all sums held hereunder, together with all records
and other documents necessary or appropriate in connection with the
performance of the duties of the successor Representative under this
Guaranty, and (ii) take such other actions as may be necessary or appropriate
in connection with the assignment to such successor Representative of the
rights created hereunder, whereupon such retiring or removed Representative
shall be discharged from its duties and obligations under this Guaranty.
After any retiring or removed Representative's resignation or removal
hereunder as Representative, the provisions of this Guaranty shall inure to
its benefit as to any actions taken or omitted to be taken by it under this
Guaranty while it was Representative hereunder.
13
IN WITNESS WHEREOF, the undersigned Guarantor has caused this
Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of the date first written above.
SANTA FE GAMING CORPORATION
By /s/ Xxxxxx X. Land
Title Senior Vice President and
Chief Financial Officer
S-1
