EXHIBIT 4.01
15
ELEVENTH AMENDMENT TO
CREDIT AGREEMENT
THIS ELEVENTH AMENDMENT TO CREDIT AGREEMENT (this
"Eleventh Amendment") is made and dated as of May 13, 1997 among
Rio Properties, Inc., a Nevada corporation (the "Company"), Rio
Leasing, Inc. ("Rio Leasing"; the Company and Rio Leasing, each a
"Borrower" and collectively, the "Borrowers"), the several
financial institutions party hereto ("Banks"), and Bank of
America National Trust and Savings Association, as agent for the
Banks (the "Agent") and amends the Credit Agreement dated as of
July 15, 1993 among the Borrowers, the Banks and the Agent, as
amended by a First Amendment to Credit Agreement dated as of
October 25, 1993, a Second Amendment to Credit Agreement dated as
of November 8, 1993, a Third Amendment to Credit Agreement dated
as of April 15, 1994, a Fourth Amendment to Credit Agreement
dated as of December 16, 1994, a Fifth Amendment to Credit
Agreement dated as of March 20, 1995, a Sixth Amendment to Credit
Agreement dated as of July 31, 1995, a Seventh Amendment to
Credit Agreement dated as of January 17, 1996, an Eighth
Amendment to Credit Agreement dated as of June 17, 1996, a Ninth
Amendment to Credit Agreement and Notes dated as of January 13,
1997 and a Tenth Amendment to Credit Agreement dated as of
February 3, 1997 (as so amended, the "Agreement").
RECITALS
A. Rio Development Company, Inc., a Nevada
corporation, and wholly-owned subsidiary of the Parent Guarantor,
("Rio Development") is forming Rio Golf Limited Partnership, a
Nevada limited partnership to acquire, complete and manage the
Seven Hills golf course, a golf course under construction in
Henderson, Nevada (the "Seven Hills Venture L.P."). Rio
Development will be the sole general and the managing general
partner of Seven Hills Venture L.P. and will own an approximate
2% partnership interest therein. Rio Resort Properties, Inc., a
Nevada corporation, and wholly-owned subsidiary of the Parent
Guarantor, ("Rio Resorts") will own an approximate 58% limited
partnership interest in the Seven Hills Venture L.P. These
partnership interests will be the sole assets of Rio Development
and Rio Resorts. The golf course is being acquired from the
existing owners, a limited partnership, for a purchase price of
approximately $9,000,000, plus the assumption of certain debt.
B. In anticipation of this acquisition, the Company
already has made and may make up to $6,000,000 in the aggregate
in advances to a general partner of the existing limited
partnership to fund certain Capital Expenditures at the golf
course. Such advances will be applied towards the acquisition
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price of the golf course, and are secured by the existing
partnership interests of such existing partner. The Company has
requested a waiver of Section 7.04 of the Agreement to permit
such advances.
C. Following Seven Hills Venture L.P.'s acquisition
of the golf course, Rio Development desires to obtain up to
$12,000,000 in financing outside the Agreement to repay the
Company for the funds it advanced and also to fund certain
additional Capital Expenditures at the golf course. This
financing will be guarantied by the Company and Rio Resorts and
may be secured by a pledge of the stock of Rio Development and
Rio Resorts, as well as the Seven Hills Venture L.P. partnership
interests owned by Rio Development and Rio Resorts. In the
aggregate, the Parent Guarantor and its Subsidiaries and
Unrestricted Subsidiaries may make up to $12,000,000 in
investments in the Seven Hills Venture L.P., including the
purchase price for the golf course.
D. The Agent and the Banks are willing to agree to
the foregoing transactions PROVIDED that Rio Development, Rio
Resorts and the Seven Hills Venture L.P. shall be deemed
Unrestricted Subsidiaries not included as Subsidiaries for any
purposes under the Agreement, and the Company's guaranty of the
financing referred to in Recital C above shall not be included in
the Interest Coverage Ratio unless and until such guaranty is
called upon.
E. The Borrowers also desire a Swing Line of up to
$10,000,000 be established as a sublimit within the Aggregate
Revolving Commitment to permit same-day borrowings under the
Agreement, and bank of America National Trust and Savings
Association has agreed to be the Swing Line Bank, and the Banks
and the Agent are willing to create such a Swing Line.
F. The Parent Guarantor is creating a new Subsidiary,
HLG, Inc., a Nevada corporation ("HLG") to provide out of state
marketing and collection services, and HLG has agreed to pledge
substantially all of its assets to the Agent, to become a
guarantor and to have its stock is pledged to the Agent.
G. The Agent, the Banks, the Borrowers and the Parent
Guarantor desire to amend the Parent Guarantor Security Agreement
to have the Parent Guarantor pledge its stock in Rio Leasing upon
obtaining requisite regulatory approval and in HLG.
NOW, THEREFORE, for good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the
parties hereby agree as follows:
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1. TERMS. All terms used herein shall have the same
meanings as in the Agreement unless otherwise defined herein.
All references to the Agreement herein shall mean the Agreement
as hereby amended.
2. AMENDMENTS TO AGREEMENT. The Borrowers, the Banks
and the Agent hereby agree that the Agreement is amended as
follows:
2.1 The definition of "Banks" in Section 1.01 of the
Agreement is amended by inserting "and shall mean and include the
Swing Line Bank," after "pursuant to Section 10.08".
2.2 The definition of "Funded Debt" in Section 1.01 of
the Agreement is amended by inserting the following at the end of
clause (a) therein:
"PROVIDED, HOWEVER that the Company's obligations under
the Guaranty Obligations permitted under Section
7.08(f) shall not be included in this definition unless
and until a demand is made under such Guaranty
Obligations by a Person entitled to make demand
thereunder,"
2.3 The definition of "Interest Expense" in Section
1.01 of the Agreement is amended by inserting the following at
the end of clause (a) therein:
"PROVIDED, HOWEVER, that the Company's obligations
under the Guaranty Obligations permitted under Section
7.08(f) shall not be included in this definition unless
and until a demand is made under such Guaranty
Obligations by a Person entitled to make demand
thereunder,"
2.4 The definition of "Loan Documents" in Section 1.01
of the Agreement is amended by inserting "the Swing Line
Documents," after "the Collateral Documents,".
2.5 The definition of "Obligations" in Section 1.01 of
the Agreement is amended by inserting "the Swing Line Bank,"
after "the Banks,".
2.6 The definition of "Subsidiary" in Section 1.01 of
the Agreement is amended by inserting "OTHER than Unrestricted
Subsidiaries" after "other business entity".
2.7 The following new definitions are inserted in
proper alphabetical order in Section 1.01 of the Agreement as
follows:
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"'HLG' means HLG, Inc., a Nevada corporation, a
wholly-owned Subsidiary of the Parent Guarantor."
"'RIGHTS OF OTHERS' means, as to any Property in
which a Person has an interest, any legal or equitable
right, title or other interest (other than a Lien) held
by any other Person in that Property, and any option or
right held by any other Person to acquire any such
right, title or other interest in that Property,
INCLUDING any option or right to acquire a Lien;
PROVIDED, however, that (a) any covenant restricting
the use or disposition of Property of such Person
contained in any Contractual Obligation of such Person
and (b) any provision contained in a contract creating
a right of payment or performance in favor of a Person
that conditions, limits, restricts, diminishes,
transfers or terminates such right, shall not be deemed
to constitute a Rights of Others."
"'RIO DEVELOPMENT' means Rio Development Company,
Inc., a Nevada corporation, a wholly-owned Unrestricted
Subsidiary of the Parent Guarantor."
"'RIO RESORTS' means Rio Resort Properties, Inc.,
a Nevada corporation, a wholly-owned Unrestricted
Subsidiary of the Parent Guarantor."
"'SEVEN HILLS VENTURE BASKET' means $12,000,000."
"'SEVEN HILLS VENTURE BASKET EXPENDITURES' means
(without duplication) the aggregate of the amounts
invested directly or indirectly by the Parent Guarantor
and its Subsidiaries and Unrestricted Subsidiaries in
the Seven Hills Golf Course and/or the Seven Hills
Venture L.P., including without limitation all Capital
Expenditures funded by the Parent Guarantor and its
Subsidiaries and Unrestricted Subsidiaries in
connection therewith, all amounts expended to purchase
the Seven Hills Golf Course and all Indebtedness
permitted by Section 7.05(i)."
"'SEVEN HILLS GOLF COURSE' means the Seven Hills
Golf Course, a golf course in Henderson, Nevada and
related equipment and fixtures."
"'SEVEN HILLS VENTURE L.P.' means a Nevada limited
partnership owning, completing construction of and
operating the Seven Hills Golf Course, of which Rio
Development is the approximate 2% general and the
managing partner, and Rio Resorts is an approximate 58%
limited partner."
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"'SWING LINE' means the revolving line of credit
established as a sublimit within the Aggregate
Revolving Commitment by the Swing Line Bank in favor of
Borrowers pursuant to Section 2.16."
"'SWING LINE BANK' means Bank of America National
Trust and Savings Association."
"'SWING LINE DOCUMENTS' means the promissory note
and any other documents executed by Borrowers in favor
of the Swing Line Bank in connection with the Swing
Line."
"'SWING LINE LOANS' means loans made by the Swing
Line Bank to Borrowers pursuant to Section 2.16."
"'SWING LINE OUTSTANDINGS' means, as of any date
of determination, the aggregate principal Indebtedness
of Borrowers on all Swing Line Loans then outstanding."
"'UNRESTRICTED SUBSIDIARIES' means Rio
Development, Rio Resorts and the Seven Hills Venture
L.P."
2.8 Section 2.01(c) of the Agreement is amended and
restated in its entirety as follows:
"(c) Each Bank severally agrees, on the terms and
conditions hereinafter set forth, to make Loans (each
such Loan, a "REVOLVING LOAN") to the Borrowers on the
Construction Loan Termination Date in an aggregate
principal amount not exceeding the amount set forth
opposite such Bank's name on SCHEDULE 2.01 under the
heading "revolving Commitment" (such amount as the same
may be reduced pursuant to Section 2.05 or Section 2.07
or as a result of one or more assignments pursuant to
Section 10.08, such Bank's "REVOLVING COMMITMENT") and
thereafter to make Revolving Loans to the Borrowers in
an amount not exceeding its Revolving Commitment from
time to time on any Business Day during the period from
the Construction Loan Termination Date to the Revolving
Termination Date; PROVIDED, HOWEVER, that, after giving
effect to any Borrowing of Revolving Loans, (i) each
Bank's Revolving Loans shall not exceed its Available
Revolving Commitment, and (ii) the aggregate principal
amount of all outstanding Revolving Loans PLUS the
aggregate principal amount of all Swing Line
Outstandings shall not exceed the Available Aggregate
Revolving Commitment. Within the limits of each Bank's
Revolving Commitment, and subject to the other terms
and conditions hereof, the Borrowers may borrow under
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this Section 2.01, prepay pursuant to Section 2.06 and
reborrow pursuant to this Section 2.01."
2.9 A new Section 2.16 is inserted in the Agreement
after Section 2.15 as follows:
"2.16 SWING LINE. (a) The Swing Line Bank shall
from time to time until the Revolving Termination Date
make Swing Line Loans to Borrowers in such amounts as
Borrowers may request, PROVIDED that (i) after giving
effect to such Swing Line Loan, the Swing Line
Outstandings do not exceed $10,000,000, (ii) without
the consent of all of the Banks, no Swing Line Loan may
be made during the continuation of an Event of Default
and (iii) the Swing Line Bank has not given at least
twenty-four (24) hours prior notice to Borrowers that
availability under the Swing Line is suspended or
terminated. Borrowers may borrow, repay and reborrow
under this Section. Unless notified to the contrary by
the Swing Line Bank, borrowings under the Swing Line
may be made in amounts which are integral multiples of
$100,000 upon telephonic request by a Responsible
Officer of Borrowers made to the Agent not later than
1:00 p.m., San Francisco time, on the Business Day of
the requested borrowing (which telephonic request shall
be promptly confirmed in writing by telecopier).
Promptly after receipt of such a request for borrowing,
the Agent shall provide telephonic verification to the
Swing Line Bank that, after giving effect to such
request, availability for Loans will exist under
Section 2.01(c) (and such verification shall be
promptly confirmed in writing by telecopier). Unless
notified to the contrary by the Swing Line Bank, each
repayment of a Swing Line Loan shall be in an amount
which is an integral multiple of $100,000. If
Borrowers instruct the Swing Line Bank to debit its
demand deposit account(s) at the Swing Line Bank or any
of its Affiliates in the amount of any payment with
respect to a Swing Line Loan, or the Swing Line Bank
otherwise receives repayment, after 3:00 p.m., San
Francisco time, on a Business Day, such payment shall
be deemed received on the next Business Day. The Swing
Line Bank shall promptly notify the Agent of the Swing
Line Outstandings each time there is a change therein.
"(b) Swing Line Loans shall bear interest at a
fluctuating rate per annum equal to the Base Rate PLUS
(if applicable) the Applicable Margin. Interest shall
be payable on such dates, not more frequently than
monthly, as may be specified by the Swing Line Bank and
in any event on the Revolving Termination Date. The
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Swing Line Bank shall be responsible for invoicing
Borrowers for such interest. The interest payable on
Swing Line Loans is solely for the account of the Swing
Line Bank (subject to subsection (d) below).
"(c) The Swing Line Loans shall be payable on
demand made by the Swing Line Bank and in any event on
the Revolving Termination Date.
"(d) Upon the making of a Swing Line Loan, each
Bank shall be deemed to have purchased from the Swing
Line Bank a participation therein in an amount equal to
that Bank's Commitment Percentage of the Revolving
Commitment TIMES the amount of the Swing Line Loan.
Upon demand made by the Swing Line Bank, each Bank
shall, according to its Commitment Percentage of the
Commitment, promptly provide to the Swing Line Bank its
purchase price therefor in an amount equal to its
participation therein. The obligation of each Bank to
so provide its purchase price to the Swing Line Bank
shall be absolute and unconditional (except only demand
made by the Swing Line Bank) and shall not be affected
by the occurrence of a Default or Event of Default;
PROVIDED that no Bank shall be obligated to purchase
its Commitment Percentage Share of (i) Swing Line Loans
to the extent that Swing Line Outstandings are in
excess of $10,000,000 and (ii) any Swing Line Loan made
(absent the consent of all of the Banks) during the
continuation of an Event of Default. Each Bank that
has provided to the Swing Line Bank the purchase price
due for its participation in Swing Line Loans shall
thereupon acquire a pro rata participation, to the
extent of such payment, in the claim of the Swing Line
Bank against Borrowers for principal and interest and
shall share, in accordance with that pro rata
participation, in any principal payment made by
Borrowers with respect to such claim and in any
interest payment made by Borrowers (but only with
respect to periods subsequent to the date such Bank
paid the Swing Line Bank its purchase price) with
respect to such claim.
"(e) In the event that the Swing Line Outstandings
are in excess of $5,000,000 on three (3) consecutive
Business Days, then on the next Business Day (unless
Borrowers have made other arrangements acceptable to
the Swing Line Bank to reduce the Swing Line
Outstandings below $5,000,000), Borrowers shall
requests a Loan pursuant to Section 2.01(c) sufficient
to reduce the Swing Line Outstandings below $5,000,000.
In addition, upon any demand for payment of the Swing
Line
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Outstandings by the Swing Line Bank (unless Borrowers
have made other arrangements acceptable to the Swing
Line Bank to reduce the Swing Line Outstandings to $0),
Borrowers shall request a Loan pursuant to Section
2.01(c) sufficient to repay all Swing Line Outstandings
(and, for this purpose, Section 2.03(a)(i)(A) shall not
apply). In each case, the Agent shall automatically
provide the responsive Revolving Loans made by each
Bank to the Swing Line Bank (which the Swing Line Bank
shall then apply to the Swing Line Outstandings). In
the event that Borrowers fail to request a Loan within
the time specified by Section 2.03 or any such date,
the Agent may, but is not required to, without notice
to or the consent of Borrowers, cause Revolving Loans
to be made by the Banks under the Revolving Commitment
in amounts which are sufficient to reduce the Swing
Line Outstandings as required above. The conditions
precedent set forth in Section 4.02 shall not apply to
revolving Loans to be made by the Banks pursuant to the
three preceding sentences. The proceeds of such
revolving Loans shall be paid directly to the Swing
Line Bank for application to the Swing Line
Outstandings."
2.10 Section 2.10(c) of the Agreement is amended by
inserting the following new sentence after the first sentence as
follows:
"For purposes of computing the Commitment fee, Swing
Line Outstandings shall not be considered utilization
of the Available Revolving Commitment."
2.11 Section 2.12(a) of the Agreement is amended by
inserting the following at the end of the first sentence:
"(OTHER than payments with respect to Swing Line Loans,
which must be received by 3:00 p.m.), San Francisco
time, on the day of payment (which must be a Business
Day)."
2.12 Section 5.19 of the Agreement is amended and
restated in its entirety as follows:
"5.19 SUBSIDIARIES AND OTHER INVESTMENTS. The
Parent Guarantor does not have any Subsidiaries,
Unrestricted Subsidiaries or any equity investments in
any other corporation or entity other than those
specifically disclosed in SCHEDULE 5.19, in each case
as such Schedule is updated from time to time (which
updates shall be deemed to update any previous Schedule
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from the date received by the Agent without further
action by any party hereto)."
2.13 Section 6.02 of the Agreement (Certificates; Other
Information) is amended by deleting "and" at the end of
subsection (e), deleting the period at the end of subsection (f)
and inserting "; and" in lieu thereof, and inserting a new
subsection (g) as follows:
"(g) Concurrently with the delivery of the
financial statements referred to in Sections 6.01(a)
and (b), a written report, in form and detail
reasonably acceptable to the Agent, describing (i) the
status of the Seven Hills Venture L.P., (ii) the amount
of Seven Hills Venture Basket Expenditures made and
reasonably anticipated to be made, and (iii) the amount
of cash, if any, distributed by the Seven Hills Venture
L.P. to Rio Development or Rio Properties."
2.14 Section 6.14 of the Agreement (New Subsidiaries)
is amended by inserting the following at the end of the proviso
to the first paragraph before the period:
"PROVIDED, FURTHER, that Unrestricted Subsidiaries
shall not be required to be Guarantors or to pledge any
of their assets, or to have any of their capital stock
or other ownership interests pledged."
2.15 Section 7.01 of the Agreement (Limitations on
Liens) is amended by deleting "and" at the end of subsection (k),
deleting the period at the end of subsection (1) and inserting ";
and" in lieu thereof, and inserting a new subsection (m) as
follows:
"(m) Liens on the capital stock of Rio Development
and Rio Resorts and their respective partnership
interests in the Seven Hills Venture L.P. securing
Indebtedness permitted by Section 7.05(i), and Rights
of Others consisting of a partnership interest in the
Seven Hills Venture L.P., or consisting of obligations
of Rio Development or Rio Resorts to sell, or rights of
other Persons to purchase, partnership interests in the
Seven Hills Venture L.P., which obligations or rights
were created substantially concurrently with the
acquisition of the partnership interests in the Seven
Hills Venture L.P."
2.16 Section 7.04 of the Agreement (Loans and
Investments) is amended by deleting "and" at the end of
subsection (b), deleting the period at the end of subsection (c)
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and inserting "; and" in lieu thereof, and inserting a new
subsection (d) as follows:
"(d) investments in Rio Development, Rio
Resorts, the Seven Hills Venture L.P. and the Seven
Hills Golf Course; PROVIDED, that, after giving effect
thereto, the Seven Hills Venture Basket Expenditures
would not exceed the Seven Hills Venture Basket and no
Default or Event of Default then exists or would result
therefrom; PROVIDED, FURTHER, that no Loan Party shall
cause or permit any Unrestricted Subsidiary to own any
assets other than the Seven Hills Venture L.P. or the
Seven Hills Golf Course."
2.17 Section 7.05 of the Agreement (Limitations on
Indebtedness) is amended by deleting "and" at the end of
subsection (g), deleting the period at the end of subsection (h)
and inserting "; and" in lieu thereof, and inserting a new
subsection (i) as follows:
"(i) Indebtedness of Rio Development and/or
Rio Resorts not exceeding $12,000,000 in the aggregate,
the proceeds of which are used FIRST to repay all Seven
Hills Venture Basket Expenditures made by the Parent
Guarantor or any other of its Subsidiaries in
connection with the Seven Hills Venture L.P. and the
Seven Hills Golf Course, and SECOND to make additional
investments in the Seven Hills Venture L.P.; PROVIDED,
that, after giving effect thereto, the Seven Hills
Venture Basket Expenditures would not exceed the Seven
Hills Venture Basket and no Default or Event of Default
then exists or would result therefrom."
2.18 Section 7.08 of the Agreement (Contingent
Obligations) is amended by deleting "and" at the end of
subsection (d), deleting the period at the end of subsection (e)
and inserting ";" in lieu thereof, and inserting the following
new subsections:
"(f) Guaranty Obligations of the Company
and/or Rio Resorts with respect to Indebtedness of Rio
Development and/or Rio Resorts permitted by Section
7.05(i); and
"(g) Contingent Obligations of Rio
Development for the obligations of Seven Hills Venture
L.P. in its capacity as a general partner of Seven
Hills Venture L.P."
2.19 Section 7.13 of the Agreement (Capital
Expenditures) is amended and restated in its entirety as follows:
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"7.13 CAPITAL EXPENDITURES. The Loan
Parties and their respective Subsidiaries and
Unrestricted Subsidiaries shall not make, or become
legally obligated to make, any Capital Expenditures
EXCEPT:
"(a) Capital Expenditures in any fiscal year
not in excess of the SUM OF (i) $7,500,000 PLUS (ii)
the amount, if any, by which $7,500,000 exceeds Capital
Expenditures made by the Loan Parties and their
combined Subsidiaries in the immediately preceding
fiscal year; PROVIDED, HOWEVER, that Capital
Expenditures shall not exceed $12,500,000 in any fiscal
year;
"(b) acquisition costs of Real Property not
exceeding $35,000,000 in the aggregate;
"(c) Capital Expenditures not exceeding
$225,000,000 in the aggregate for the Phase 5
Expansion; and
"(d) Capital Expenditures in connection with
the Seven Hills Venture L.P. and the Seven Hills Golf
Course; PROVIDED, that, after giving effect thereto,
the Seven Hills Venture Basket Expenditures would not
exceed the Seven Hills Venture Basket and no Default or
Event of Default then exists or would result
therefrom."
2.20 Section 8.01(aa) of the Agreement is amended and
restated in its entirety as follows:
"(aa) USE OF DIVIDENDS BY PARENT GUARANTOR.
Any dividends received by the Parent Guarantor from any
other Loan Party as permitted by Section 7.12(c) are
not promptly (i) used to make required interest
payments on the Parent Senior Subordinated Notes as and
when due, (ii) contributed to the Company, or (iii)
used for operating expenses of the Parent Guarantor in
the Ordinary Course of Business;"
2.21 Schedule 5.19 is amended and restated in its
entirety in the form of Schedule 5.19 hereto.
3. REPRESENTATIONS AND WARRANTIES. The Borrowers
jointly and severally represent and warrant to the Banks and
Agent:
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3.1 AUTHORITY. The Borrowers have all necessary power
and have taken all corporate action necessary to make this
Eleventh Amendment, the Agreement, and all other agreements and
instruments to which they are a party executed in connection
herewith and therewith, the valid and enforceable obligations
they purport to be.
3.2 NO LEGAL OBSTACLE TO ELEVENTH AMENDMENT. Neither
the execution of this Eleventh Amendment, the making by any
Borrower of any borrowing under the Agreement, nor the
performance of the Agreement by any Borrower has constituted or
resulted in or will constitute or result in a breach of the
provisions of any contract to which any Borrower is a party, or
the violation of any law, judgment, decree or governmental order,
rule or regulation applicable to any Borrower, or result in the
creation under any agreement or instrument of any security
interest, lien, charge, or encumbrance upon any of the assets of
any Borrower, except as permitted in the Agreement. No approval
or authorization of any governmental authority is required to
permit the execution, delivery or performance by any Borrower of
this Eleventh Amendment, the Agreement, or the transactions
contemplated hereby or thereby, or the making of any borrowing by
any Borrower under the Agreement.
3.3 INCORPORATION OF CERTAIN REPRESENTATIONS. The
representations and warranties set forth in Article V of the
Agreement are true and correct in all respects on and as of the
date hereof as though made on and as of the date hereof.
3.4 DEFAULT. No Event of Default under the Agreement
has occurred and is continuing.
4. CONDITIONS, EFFECTIVENESS. The effectiveness of
this Eleventh Amendment shall be subject to the compliance by the
Borrowers with their agreements herein contained, and to the
delivery of the following to the Agent in form and substance
satisfactory to the Agent:
4.1 CORPORATE RESOLUTIONS. A copy of a resolution or
resolutions passed by the Board of Directors of each Borrower,
certified by the Secretary or an Assistant Secretary of each
Borrower as being in full force and effect on the date hereof,
authorizing the amendments to the Agreement, and the Loan
Documents to which each is a party, and the execution, delivery
and performance of this Eleventh Amendment.
4.2 AUTHORIZED SIGNATORIES. A certificate, signed by
the Secretary or an Assistant Secretary of each Borrower dated
the date hereof, as to the incumbency of the person or persons
authorized to execute and deliver this Eleventh Amendment and any
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instrument or agreement required hereunder on behalf of the
Borrowers.
4.3 FIRST AMENDMENT TO PARENT GUARANTOR SECURITY
AGREEMENT. The First Amendment to Parent Guarantor Security
Agreement substantially in the form of EXHIBIT 4.3 to this
Eleventh Amendment, duly executed and delivered by the Parent
Guarantor, together with all certificates and instruments
representing the Pledged Collateral for HLG and undated stock
transfer powers executed in blank.
4.4 HLG GUARANTY. The HLG Guaranty substantially in
the form of EXHIBIT 4.4 to this Eleventh Amendment, duly executed
and delivered by HLG.
4.5 HLG SECURITY AGREEMENT. The HLG Security
Agreement substantially in the form of EXHIBIT 4.5 to this
Eleventh Amendment, together with all financing statements,
certificates, assurances and other instruments as the Agent shall
have requested.
4.6 OFFICER'S CERTIFICATE. A certificate signed by a
Responsible Officer certifying that Section 5.13 of the Agreement
is true and correct after giving effect to this Eleventh
Amendment.
4.7 OTHER DOCUMENTS. The Loan Parties shall have (and
shall cause any of their respective Subsidiaries to have) done,
executed, acknowledged, delivered, recorded, re-recorded, filed,
re-filed, registered and re-registered, any and all such further
acts, deeds, conveyances, security agreements, Mortgages,
assignments, estoppel certificates, financing statements and
continuations thereof, notices of assignment, transfers,
certificates, assurances and other instruments as the Agent shall
have requested in order (i) to carry out more effectively the
purposes of this Eleventh Amendment and (ii) to perfect and
maintain the validity, effectiveness and priority of any of the
Collateral Documents and the Liens intended to be created
thereby.
4.8 OTHER EVIDENCE. Such other evidence with respect
to the Loan Parties or any other person as the Agent or any Bank
may reasonably request to establish the consummation of the
transactions contemplated hereby, the taking of all corporate
action in connection with this Eleventh Amendment, the Agreement
and the Notes and the compliance with the conditions set forth
herein.
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5. MISCELLANEOUS.
5.1 EFFECTIVENESS OF THE AGREEMENT. Except as hereby
expressly amended, the Agreement remains in full force and
effect, and is hereby ratified and confirmed in all respects.
5.2 WAIVERS.
(a) The Banks and the Agent hereby waive any
violation of Section 7.04 of the Agreement resulting from the
advances described in Recital B to this Eleventh Amendment;
PROVIDED, that, after giving effect thereto, the Seven Hills
Venture Basket Expenditures made by the Parent Guarantor and its
Subsidiaries and Unrestricted Subsidiaries shall not exceed the
Seven Hills Venture Basket and no other Default or Event of
Default would result therefrom.
(b) This Eleventh Amendment is specific in time
and in intent and does not constitute, nor should it be construed
as, a waiver of any other right, power or privilege under the
Loan Documents, or under any agreement, contract, indenture,
document or instrument mentioned in the Loan Documents; nor does
it preclude any exercise thereof or the exercise of any other
right, power or privilege, nor shall any future waiver of any
right, power, privilege or default hereunder, or under any
agreement, contract, indenture, document or instrument mentioned
in the Loan Documents, constitute a waiver of any other default
of the same or of any other term or provision.
5.3 COUNTERPARTS. This Eleventh Amendment may be
executed in any number of counterparts and all of such
counterparts taken together shall be deemed to constitute one and
the same instrument. This Eleventh Amendment shall not become
effective until the Borrowers, the Banks and the Agent shall have
signed a copy hereof, and the Parent Guarantor shall have
consented hereto, whether the same instrument or counterparts,
and the same shall have been delivered to the Agent.
5.4 JURISDICTION. This Eleventh Amendment, and any
instrument or agreement required hereunder, shall be governed by
and construed under the laws of the State of Nevada; provide that
the Agent and the Banks shall retain all rights arising under
Federal law.
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IN WITNESS WHEREOF, the parties hereto have caused this
Eleventh Amendment to be duly executed and delivered as of the
date first written above.
RIO PROPERTIES, INC.
RIO LEASING, INC.
By:
Xxxxxx X. Xxxxxxxxx
Chief Financial Officer
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
By:
Xxxxxx Xxxxxxx
Vice President
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as a Bank
By:
Xxx Xxxxxxx
Managing Director
XXXXX FARGO BANK NATIONAL
ASSOCIATION
By:
Title:
FIRST SECURITY BANK, N.A.
By:
(Signatures continue) Title:
-15-
NBD BANK
By:
Title:
SOCIETE GENERALE
By:
Title:
U.S. BANK OF NEVADA
By:
Title:
BANK OF SCOTLAND
By:
Title:
PNC BANK, NATIONAL ASSOCIATION,
SUCCESSOR BY MERGER TO MIDLANTIC
BANK, N.A.
By:
Title:
BANK OF HAWAII
By:
Title:
-16-
CONSENT OF PARENT GUARANTOR
AND SUBSIDIARY GUARANTOR
The undersigned Parent Guarantor, as party to the
Parent Guaranty dated July 15, 1995, and the undersigned
Subsidiary Guarantor, as party to the Subsidiary Guaranty dated
January 13, 1997, hereby consent to the foregoing Eleventh
Amendment to Credit Agreement dated as of May 13, 1997 and
confirm that the Parent Guaranty and Subsidiary Guaranty remain
in full force and effect after giving effect thereto and
represent and warrant that there is no defense, counterclaim or
offset of any type or nature under the Parent Guaranty or the
Subsidiary Guaranty.
Dated as of May 13, 1997
RIO HOTEL & CASINO, INC.
CINDERLANE, INC.
By:
Xxxxxx X. Xxxxxxxxx
Chief Financial Officer
-17-
TWELFTH AMENDMENT TO
CREDIT AGREEMENT AND WAIVER
THIS TWELFTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER
(this "Twelfth Amendment") is made and dated as of May 13, 1997
among Rio Properties, Inc., a Nevada corporation (the "Company"),
Rio Leasing, Inc. ("Rio Leasing"; the Company and Rio Leasing,
each a "Borrower" and collectively, the "Borrowers"), the several
financial institutions party hereto ("Banks"), and Bank of
America National Trust and Savings Association, as agent for the
Banks (the "Agent") and amends the Credit Agreement dated as of
July 15, 1993 among the Borrowers, the Banks and the Agent, as
amended by a First Amendment to Credit Agreement dated as of
October 25, 1993, a Second Amendment to Credit Agreement dated as
of November 8, 1993, a Third Amendment to Credit Agreement dated
as of April 15, 1994, a Fourth Amendment to Credit Agreement
dated as of December 16, 1994, a Fifth Amendment to Credit
Agreement dated as of March 20, 1995, a Sixth Amendment to Credit
Agreement dated as of July 31, 1995, a Seventh Amendment to
Credit Agreement dated as of January 17, 1996, an Eighth
Amendment to Credit Agreement dated as of June 17, 1996, a Ninth
Amendment to Credit Agreement and Notes dated as of January 13,
1997, a Tenth Amendment to Credit Agreement dated as of February
3, 1997 and an Eleventh Amendment to Credit Agreement dated as of
May 13, 1997 (as so amended, the "Agreement").
RECITAL
The Borrowers notified the Agent that its total
leverage ratio, calculated in accordance with Section 8.01(y) of
the Agreement, was 4.98 to 1 for the fiscal quarter ending March
31, 1997. Such Section requires that such ratio not exceed 4.75
to 1 for such fiscal quarter. Accordingly, the Borrowers have
requested, and the Agent and the Banks are willing, to waive
Section 8.01(y) of the Agreement for the fiscal quarter ending
March 31, 1997 and to amend such section for the fiscal quarters
ending June 30, 1997, September 30, 1997 and December 31, 1997,
on the terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the
parties hereby agree as follows:
1. TERMS. All terms used herein shall have the same
meanings as in the Agreement unless otherwise defined herein.
All references to the Agreement herein shall mean the Agreement
as hereby amended.
-1-
2. AMENDMENTS TO AGREEMENT. The Borrowers, the Banks
and the Agent hereby agree that the table in Section 8.01(y) of
the Agreement is amended by deleting the ratios set forth
opposite the fiscal quarters ending 6/30/97, 9/30/97 and 12/31/97
and inserting the following ratios in lieu thereof:
FISCAL QUARTER ENDING RATIO
"6/30/97 5.25:1.00
9/30/97 5.00:1.00
12/31/97 4.50:1.00"
3. REPRESENTATIONS AND WARRANTIES. The Borrowers
jointly and severally represent and warrant to the Banks and
Agent:
3.1 AUTHORITY. The Borrowers have all necessary power
and have taken all corporate action necessary to make this
Twelfth Amendment, the Agreement, and all other agreements and
instruments to which they are a party executed in connection
herewith and therewith, the valid and enforceable obligations
they purport to be.
3.2 NO LEGAL OBSTACLE TO TWELFTH AMENDMENT. Neither
the execution of this Twelfth Amendment, the making by any
Borrower of any borrowings under the Agreement, nor the
performance of the Agreement by any Borrower has constituted or
resulted in or will constitute or result in a breach of the
provisions of any contract to which any Borrower is a party, or
the violation of any law, judgment, decree or governmental order,
rule or regulation applicable to any Borrower, or result in the
creation under any agreement or instrument of any security
interest, lien, charge, or encumbrance upon any of the assets of
any Borrower, except as permitted in the Agreement. No approval
or authorization of any governmental authority is required to
permit the execution, delivery or performance by any Borrower of
this Twelfth Amendment, the Agreement, or the transactions
contemplated hereby or thereby, or the making of any borrowing by
any Borrower under the Agreement.
3.3 INCORPORATION OF CERTAIN REPRESENTATIONS. The
representations and warranties set forth in Article V of the
Agreement are true and correct in all respects on and as of the
date hereof as though made on and as of the date hereof.
3.4 DEFAULT. Except as waived hereby, no Event of
Default under the Agreement has occurred and is continuing.
4. CONDITIONS, EFFECTIVENESS. The effectiveness of
this Twelfth Amendment shall be subject to the compliance by the
-2-
Borrowers with their agreements herein contained, and to the
delivery of the following to the Agent in form and substance
satisfactory to the Agent:
4.1 CORPORATE RESOLUTIONS. A copy of a resolution or
resolutions passed by the Board of Directors of each Borrower,
certified by the Secretary or an Assistant Secretary of each
Borrower as being in full force and effect on the date hereof,
authorizing the amendments to the Agreement, and the Loan
Documents to which each is a party, and the execution, delivery
and performance of this Twelfth Amendment.
4.2 AUTHORIZED SIGNATORIES. A certificate, signed by
the Secretary or an Assistant Secretary of each Borrower dated
the date hereof, as to the incumbency of the person or persons
authorized to execute and deliver this Twelfth Amendment and any
instrument or agreement required hereunder on behalf of the
Borrowers.
4.3 OTHER EVIDENCE. Such other evidence with respect
to the Loan Parties or any other person as the Agent or any Bank
may reasonably request to establish the consummation of the
transactions contemplated hereby, the taking of all corporate
action in connection with this Twelfth Amendment, the Agreement
and the Notes and the compliance with the conditions set forth
herein.
5. MISCELLANEOUS.
5.1 WAIVER. The Banks and the Agent hereby waive
compliance with Section 8.01(y) of the Agreement for the fiscal
quarter ending March 31, 1997. This Twelfth Amendment is
specific in time and in intent and does not constitute, nor
should it be construed as, a waiver of any other right, power or
privilege under the Loan Documents, or under any agreement,
contract, indenture, document or instrument mentioned in the Loan
Documents; nor does it preclude any exercise thereof or the
exercise of any other right, power or privilege, nor shall any
future waiver of any right, power, privilege or default
hereunder, or under any agreement, contract, indenture, document
or instrument mentioned in the Loan Documents, constitute a
waiver of any other default of the same or of any other term or
provision.
5.2 EFFECTIVENESS OF THE AGREEMENT. Except as hereby
expressly amended, the Agreement remains in full force and
effect, and is hereby ratified and confirmed in all respects.
5.3 COUNTERPARTS. This Twelfth Amendment may be
executed in any number of counterparts and all of such
-3-
counterparts taken together shall be deemed to constitute one and
the same instrument. This Twelfth Amendment shall not become
effective until the Borrowers, the Banks and the Agent shall have
signed a copy hereof, and the Parent Guarantor shall have
consented hereto, whether the same instrument or counterparts,
and the same shall have been delivered to the Agent.
5.4 JURISDICTION. This Twelfth Amendment, and any
instrument or agreement required hereunder, shall be governed by
and construed under the laws of the State of Nevada; provided
that the Agent and the Banks shall retain all rights arising
under Federal law.
IN WITNESS WHEREOF, the parties hereto have caused this
Twelfth Amendment to be duly executed and delivered as of the
date first written above.
RIO PROPERTIES, INC.
RIO LEASING, INC.
By:
Xxxxxx X. Xxxxxxxxx
Chief Financial Officer
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as Agent
By:
Xxxxxx Xxxxxxx
Vice President
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as a Bank
By:
Xxx Xxxxxxx
Managing Director
XXXXX FARGO BANK NATIONAL
ASSOCIATION
By:
(Signatures continue) Title:
-4-
FIRST SECURITY BANK, N.A.
By:
Title:
NBD BANK
By:
Title:
SOCIETE GENERALE
By:
Title:
U.S. BANK OF NEVADA
By:
Title:
BANK OF SCOTLAND
By:
Title:
PNC BANK, NATIONAL ASSOCIATION,
SUCCESSOR BY MERGER TO
MIDLANTIC BANK, N.A.
By:
Title:
BANK OF HAWAII
By:
Title:
-5-
CONSENT OF PARENT GUARANTOR
AND SUBSIDIARY GUARANTORS
The undersigned Parent Guarantor, as party to the
Parent Guaranty dated July 15, 1993, Cinderlane, Inc., as party
to a Subsidiary Guaranty dated January 13, 1997, and HLG, Inc.,
Inc., as a party to a Subsidiary Guaranty dated May 13, 1997,
hereby consent to the foregoing Twelfth Amendment to Credit
Agreement dated as of May 13, 1997 and confirm that the Parent
Guaranty and each Subsidiary Guaranty remain in full force and
effect after giving effect thereto and represent and warrant that
there is no defense, counterclaim or offset of any type or nature
under the Parent Guaranty or either Subsidiary Guaranty.
Dated as of May 13, 1997
RIO HOTEL & CASINO, INC.
CINDERLANE, INC.
HLG, INC.
By:
Xxxxxx X. Xxxxxxxxx
Chief Financial Officer
-6-
