EXHIBIT 10.1
EXECUTION COPY
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U.S.$510,000,000
AMENDED AND RESTATED
LOAN AND FACILITIES AGREEMENT
among
OPBIZ, L.L.C.,
as the Borrower
and
THE LENDERS PARTY HERETO
and
THE BANK OF NEW YORK, ASSET SOLUTIONS DIVISION,
as Administrative Agent and Collateral Agent
dated as of August 31, 2004
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TABLE OF CONTENTS
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ARTICLE 1 DEFINITIONS....................................................... 2
1.1 Specific Definitions.............................................. 2
1.2 Other Definitional Provisions..................................... 39
1.3 Other Terms....................................................... 40
1.4 Accounting Terms.................................................. 40
ARTICLE 2 LOANS............................................................. 41
2.1 Total Facility.................................................... 41
2.2 Term Loan A....................................................... 41
2.3 Term Loan B....................................................... 41
2.4 Notes Evidencing Term Loans....................................... 41
2.5 Borrowing of Term Loans........................................... 42
2.6 Renewals of Term Loans............................................ 42
2.7 Term Loan Account................................................. 42
ARTICLE 3 INTEREST AND OTHER CHARGES........................................ 42
3.1 Term Loan A Interest.............................................. 42
3.2 Term Loan B Interest.............................................. 43
3.3 Default Rate...................................................... 44
3.4 Maximum Interest Rate............................................. 44
3.5 Computation of Interest........................................... 44
3.6 Agency and Collateral Monitoring Fee.............................. 45
3.7 Taxes............................................................. 45
3.8 Requirements of Law............................................... 47
3.9 Capital Adequacy Costs............................................ 47
3.10 Inability to Determine Interest Rate.............................. 48
3.11 Indemnity......................................................... 48
3.12 Illegality........................................................ 49
3.13 Replacement by the Borrower of a Lender........................... 49
ARTICLE 4 PAYMENTS AND PREPAYMENTS.......................................... 49
4.1 Principal Payments................................................ 49
4.2 Optional Prepayments of Term Loans................................ 51
4.3 Mandatory Prepayments............................................. 51
4.4 Payments, No Reborrowings......................................... 54
4.5 Place and Form of Payments; Extension of Time..................... 54
4.6 Sharing of Payments............................................... 54
4.7 Indemnity for Returned Payments................................... 55
4.8 Regulatory Replacement of Lender.................................. 56
4.9 Replacement of Lender Due to Gaming Authorities................... 56
4.10 Agent's and Lenders' Books and Records............................ 57
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4.11 Register............................................................... 57
ARTICLE 5 CONDITIONS PRECEDENT................................................... 57
5.1 Lender Conditions Precedent............................................ 57
5.2 Borrower Condition Precedent........................................... 63
ARTICLE 6 GENERAL WARRANTIES AND REPRESENTATIONS................................. 64
6.1 Authorization, Validity, and Enforceability of this Agreement
and the Loan Documents................................................. 64
6.2 Organization and Qualification......................................... 64
6.3 Subsidiaries........................................................... 65
6.4 Financial Statements................................................... 65
6.5 Capitalization......................................................... 65
6.6 Solvency............................................................... 65
6.7 Restrictive Agreements................................................. 65
6.8 Regulations U and X.................................................... 65
6.9 Broker's Fees.......................................................... 65
6.10 Disclosure............................................................. 66
6.11 Investment and Holding Company Status.................................. 66
6.12 Projections. .......................................................... 66
6.13 Payments with respect to Time Share Premises. ........................ 66
ARTICLE 7 AFFIRMATIVE COVENANTS.................................................. 66
7.1 Books and Records...................................................... 67
7.2 Financial and Other Information........................................ 67
7.3 Notices to the Agent................................................... 71
7.4 Taxes and Other Obligations............................................ 73
7.5 Existence, Good Standing and Legal Requirements........................ 73
7.6 Insurance.............................................................. 74
7.7 Environmental Laws..................................................... 76
7.8 Maintain Operating and Other Accounts.................................. 77
7.9 End of Fiscal Years.................................................... 77
7.10 Discharge of Liens..................................................... 77
7.11 Further Assurances..................................................... 78
7.12 Subsidiary Security Agreement.......................................... 79
7.13 Use of Additional Capital for Renovation Capital Expenditures.......... 79
7.14 Letter of Credit....................................................... 80
7.15 Ownership of Premises and other Collateral; Defense of Title........... 80
7.16 Management of Premises................................................. 80
7.17 Leases................................................................. 82
7.18 Maintenance, Operations, Repairs and Alterations....................... 83
7.19 Application of Insurance Proceeds...................................... 86
7.20 Application of Condemnation Proceeds................................... 88
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7.21 Appraisals.......................................................... 89
7.22 ERISA............................................................... 89
7.23 Intentionally Omitted............................................... 90
7.24 Material Operating Agreements....................................... 90
7.25 Use of Reserve...................................................... 91
7.26 Easements, Etc., in Favor of Time Share Entity. .................. 91
7.27 Consents. .......................................................... 91
7.28 Term Loan A Note Rating............................................. 91
7.29 Certain Matters Relating to Time Share Premises..................... 92
7.30 Delivery of Borrower's Plan......................................... 92
7.31 Notice under Mezzanine Escrow Agreement............................. 92
7.32 Delivery of Business Plan........................................... 93
ARTICLE 8 NEGATIVE COVENANTS.................................................. 93
8.1 Mergers, Consolidations, Sales or other Disposition;
Disposition of Time Share Premises.................................. 93
8.2 Distributions....................................................... 94
8.3 Guaranties.......................................................... 95
8.4 Debt................................................................ 95
8.5 Prepayment; Certain Matters Relating to the Mezzanine Loan.......... 96
8.6 Transactions with Affiliates........................................ 96
8.7 Business Conducted.................................................. 97
8.8 Liens............................................................... 97
8.9 Subsidiaries........................................................ 97
8.10 Restricted Investments.............................................. 97
8.11 Capital Expenditures................................................ 97
8.12 Maintenance Capital Expenditures.................................... 97
8.13 EBITDA.............................................................. 98
8.14 Interest Coverage Ratio............................................. 99
8.15 Leverage Ratio...................................................... 100
8.16 Negative Pledge Clauses............................................. 101
8.17 Restrictions on Subsidiary Distributions............................ 101
8.18 Confirmation Order.................................................. 101
8.19 Easements........................................................... 101
8.20 Changes in Zoning................................................... 102
8.21 ERISA............................................................... 102
8.22 Organizational Documents............................................ 102
8.23 Development Agreement with respect to Time Share Premises........... 102
8.24 Management Agreement; Casino Operator Agreement..................... 103
8.25 Adverse Contracts................................................... 103
8.26 Management of the Borrower.......................................... 103
8.27 Maximum Operating Cash Reserve Amount............................... 103
8.28 Plan of Reorganization.............................................. 104
8.29 Maintenance of Operating Cash Reserve Amount. ..................... 104
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8.30 Time Share Entity. .............................................. 104
8.31 Payments with respect to Time Share Premises. ................... 104
8.32 Rates for Hotel Usage by the Time Share Entity................... 104
8.33 Intentionally Omitted............................................ 104
8.34 Limited Activities............................................... 104
8.35 Leases at Shopping Mall f/k/a Desert Passage..................... 105
ARTICLE 9 DEFAULT; REMEDIES................................................ 105
9.1 Events of Default................................................ 105
9.2 Remedies......................................................... 109
9.3 Application of Proceeds of Collateral and Guaranty
Agreements....................................................... 111
ARTICLE 10 TERMINATION OF AGREEMENT......................................... 112
10.1 Termination Date................................................. 112
10.2 Termination by the Borrower...................................... 112
10.3 Termination by the Required Term Loan A Lenders.................. 112
10.4 Obligations...................................................... 112
ARTICLE 11 MISCELLANEOUS.................................................... 112
11.1 Cumulative Remedies; No Prior Recourse to Collateral............. 112
11.2 No Implied Waivers............................................... 113
11.3 Severability..................................................... 113
11.4 Governing Law.................................................... 113
11.5 Consent to Jurisdiction and Venue; Service of Process............ 113
11.6 Waiver of Jury Trial............................................. 113
11.7 Survival of Representations and Warranties and
Indemnification.................................................. 114
11.8 Indemnification.................................................. 114
11.9 Other Security and Guaranties.................................... 115
11.10 Fees and Expenses................................................ 115
11.11 Notices.......................................................... 116
11.12 Waiver of Notices................................................ 118
11.13 Binding Effect; Assignment; Confidentiality...................... 118
11.14 Modification..................................................... 120
11.15 Counterparts..................................................... 122
11.16 Captions......................................................... 122
11.17 Right of Set-Off; Security Interest in Deposit Accounts.......... 122
11.18 Limitation of Liability.......................................... 122
11.19 Time Within Which to Consent to Certain Actions. ................ 123
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ARTICLE 12 THE AGENT........................................................ 123
ARTICLE 13 GUARANTEES....................................................... 126
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EXHIBITS
EXHIBIT A Schedule of Commitments for each Lender
EXHIBIT B-1 Description of Energy Premises
EXHIBIT B-2 Description of Time Share Premises
EXHIBIT B-3 Description of Theater
EXHIBIT C Description of Premises
EXHIBIT D Form of Security Agreement
EXHIBIT E-1 Form of Term Loan A Notes
EXHIBIT E-2 Form of Term Loan B Notes
EXHIBIT F Form of U.S. Tax Compliance Certificate
EXHIBIT G Form of Opinion of the Borrower's Counsel
EXHIBIT H Confirmation Order
EXHIBIT I Form of Assignment and Acceptance Agreement
EXHIBIT J Form of Monthly Operating Report
EXHIBIT K Intentionally Omitted
EXHIBIT L Renovation Capital Expenditures
EXHIBIT M Form of Holdings Guarantee
EXHIBIT N Form of Representation and Warranty Certificate
EXHIBIT O Form of Assignment of Contract
EXHIBIT P Intentionally Omitted
EXHIBIT Q Mezzanine Loan Agreement
EXHIBIT R Form of Mezzanine Intercreditor Agreement
EXHIBIT S Form of Deposit Account Control Agreement
EXHIBIT T Planet Hollywood Security Agreement
EXHIBIT U Management Agreement
EXHIBIT V Manager Subordination Agreement
EXHIBIT W License Agreement
EXHIBIT X License Subordination Agreement
SCHEDULES
SCHEDULE 1.1 Other Permitted Liens
SCHEDULE 5.1(d) Certain Lenders Entitled to Fee
SCHEDULE 6.1 Consents
SCHEDULE 6.3 Consolidated Subsidiaries; Other Subsidiaries
SCHEDULE 6.5 Capitalization
SCHEDULE 6.7 Restrictive Agreements
SCHEDULE 8.3 Guaranties
SCHEDULE 8.4 Debt
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AMENDED AND RESTATED LOAN AND FACILITIES AGREEMENT, dated as of
August 31, 2004 among OPBIZ, L.L.C., a Nevada limited liability company (the
"Borrower"), THE FINANCIAL INSTITUTIONS PARTY HERETO AS LENDERS, THE OTHER
FINANCIAL INSTITUTIONS THAT HEREAFTER BECOME PARTIES HERETO AS LENDERS
(individually, a "Lender" and collectively, the "Lenders") and THE BANK OF NEW
YORK, ASSET SOLUTIONS DIVISION, as administrative agent and collateral agent for
the Lenders (in such capacity together with any successor thereto in such
capacity, the "Agent").
W I T N E S S E T H:
WHEREAS, Aladdin Gaming, LLC, a Nevada limited liability company
("Aladdin") entered into a (i) Credit Agreement dated as of February 26, 1998,
as amended to date (the "Pre-Petition Credit Agreement") with the Lenders party
thereto, The Bank of New York, Asset Solutions Division (as successor to The
Bank of Nova Scotia), as administrative agent for such Lenders, and Xxxxxxx
Xxxxx Capital Corporation, as syndication agent, and CIBC Xxxxxxxxxxx Corp., as
documentation agent, and (ii) Facilities Agreement dated July 26, 1998 with
General Electric Capital Corporation, individually and as agent for certain
participants, as amended to date (the "GECC Facilities Agreement");
WHEREAS, on September 28, 2001, Aladdin filed in the United States
Bankruptcy Court for the District of Nevada, Southern Division (the "Bankruptcy
Court") a voluntary petition for relief under Chapter 11 of the Bankruptcy Code
(as hereinafter defined);
WHEREAS, in connection with the implementation of Aladdin's Plan of
Reorganization (as hereinafter defined), the Borrower has entered into the
Purchase and Sale Agreement (as hereinafter defined) pursuant to which the
Borrower shall purchase certain assets from Aladdin including without limitation
the Premises (as hereinafter defined);
WHEREAS, in connection with the implementation of Aladdin's Plan of
Reorganization and pursuant to the Purchase and Sale Agreement, the Borrower
will assume certain liabilities of Aladdin arising under, inter alia, the (i)
Pre-Petition Credit Agreement and Pre-Petition Loan Documents (as hereinafter
defined) and (ii) GECC Facilities Agreement and GECC Facilities Loan Documents
(as hereinafter defined) in the aggregate principal amount of $510,000,000, such
assumption to be evidenced by this Loan Agreement and the other Loan Documents,
and the Borrower shall be obligated to repay such amount to the Lenders in
accordance with the terms and provisions set forth in this Agreement;
WHEREAS, the Lenders have agreed to make available to the Borrower
credit upon the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth in this Agreement, and for good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the Borrower, the
Lenders and the Agent hereby agree the Pre-
Petition Credit Agreement and the GECC Facilities Agreement shall be amended,
restated and superseded(1) as follows:
ARTICLE 1
DEFINITIONS
1.1 Specific Definitions. In addition to certain terms defined elsewhere
in this Agreement, the following terms shall have the meanings specified below:
"Accounts" means, collectively, all bank and other deposit accounts
of the Borrower, any Subsidiary thereof and all bank and other deposit accounts
of any Manager or any other Person, held on behalf of or for the benefit of the
Borrower or any Subsidiary thereof, including those bank and other deposit
accounts described in Section P of the Disclosure Schedule.
"Affiliate" of a specified Person means any other Person which,
directly or indirectly, controls, is controlled by or is under common control
with, the specified Person, including, without limitation, any Person: (a) which
beneficially owns or holds, directly or indirectly, ten percent (10%) or more of
(i) any class of voting stock of the specified Person, or (ii) the Equity
Interests (with voting capacity) of a Person, or (b) who (i) is a director or
executive officer (or individual with similar responsibilities) of the specified
Person or (ii) if the Person does not have directors or executive officers, has
similar responsibilities to a director or executive officer. The term "control"
(including, with correlative meanings, the terms "controlled by" and "under
common control with") means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of the specified
Person. The term "beneficial ownership" shall have the meaning set forth in Rule
13d-3 promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934. For the purpose of this definition, any Manager and each
Member and any other Person who becomes a Member after the Closing Date if
permitted under this Agreement and any Affiliates of the foregoing shall be
deemed Affiliates of the Borrower.
"Agency and Collateral Monitoring Fee" has the meaning given to such
term in Section 3.6.
"Agent" has the meaning given to such term in the recitals to this
Agreement.
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(1) with respect to Aladdin-- for purposes of clarity the entering into of this
Agreement by any Pre-Petition Lender shall not preclude such Pre-Petition
Lender from taking any action against any party (other than Aladdin) to the
Pre-Petition Loan Documents with respect to the obligations of any such party
under the Pre-Petition Loan Documents.
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"Agreement" means this Amended and Restated Loan and Facilities
Agreement, as amended, supplemented or otherwise modified from time to time.
"Aladdin" has the meaning given to such term in the recitals to this
Agreement.
"A&M" has the meaning given to such term in Section 6.12 of this
Agreement.
"Anniversary Date" means each one year anniversary of the Closing
Date.
"Annual Actual Amount of Interest" has the meaning given to such
term in Section 3.1(a)(ii) of this Agreement.
"Annual Estimated Amount of Interest" has the meaning given to such
term in Section 3.1(a)(ii) of this Agreement.
"Appraisal" means a written appraisal report of the Premises, as the
term "appraisal" is defined in the Code of Professional Ethics of the American
Institute of Appraisers, meeting the requirements of the Federal Institutions
Reform, Recovery and Enforcement Act of 1989, as amended, prepared by a
professional appraiser retained at the Borrower's expense, who is a member of
the American Institute of Appraisers, addressed to the Agent, the Borrower and
the Lenders, setting forth such appraiser's determination of the fair market
value of the Premises on the date of the Appraisal and which shall in form and
scope be satisfactory to the Agent in its reasonable discretion.
"Approved Fund" means, relative to any Lender that is a fund that
invests in bank loans, any other fund that invests in bank loans and is advised
or managed by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.
"Approved Officer" means, as to the Borrower, the president, the
chief executive, chief operating or chief financial officer, treasurer (or
assistant treasurer), controller or any vice president, manager, managing or
sole member, or other Authorized Person, of the Borrower, whose signatures and
incumbency have been certified to the Agent and the Lenders in a certificate of
the Borrower delivered to the Agent.
"Asset Transfer" means any Disposition (other than a Disposition of
the Time Share Premises (i) by the Borrower to Holdings as permitted pursuant to
Section 8.1(a) or (ii) to any other Person provided that the Net Cash Proceeds
of any such Disposition are paid to the Agent as required by Section 4.3(a)) of
any Property of the Borrower or a Subsidiary (including, without limitation, any
Equity Interests of any Subsidiary, but excluding Casualty Events), without
regard to the consideration, if any, received therefor, including, without
limitation, any Disposition effected through a merger or consolidation.
"Assignment Agreement" has the meaning given to such term in Section
11.13(b) of this Agreement.
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"Assignment of Contract" means that certain Assignment of Contract,
dated as of the Closing Date to be executed and delivered by the Borrower and
the Agent, for its own benefit and the benefit of the Lenders, in substantially
the form of Exhibit O.
"Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C.
Section 101 et seq.), as amended, and any successor statute applicable to the
Chapter 11 Case.
"Bankruptcy Court" has the meaning given to such term in the
recitals to this Agreement.
"Bay Harbour Investor" has the meaning given to such term in the
definition of "Investor Group".
"BH/RE" means BH/RE, L.L.C., a Nevada limited liability company.
"BH/RE-Starwood Agreement" means the Agreement, made and entered
into as of August 9, 2004, by and between Starwood Nevada Holdings, LLC,
Sheraton, BH/RE, EquityCo, the Borrower, and, for certain purposes as described
therein, Starwood.
"Board" means the Board of Governors of the Federal Reserve System
of the United States (or any successor).
"Borrower" has the meaning given to such term in the recitals to
this Agreement.
"Borrower Certificate" has the meaning given to such term in Section
5.1(i).
"Borrower's Plan" has the meaning given to such term in Section
7.30.
"Boulevard Invest" means Boulevard Invest, LLC, a Delaware limited
liability company.
"Business" means collectively, (i) the rental of guest, conference
or banquet rooms at the Premises; (ii) the operation of the casino at the
Premises; (iii) the operation of restaurant, bar or banquet services at the
Premises; (iv) the rental of commercial, entertainment or retail space to
tenants at the Premises; and (v) the operation of the Theater.
"Business Day" means any day excluding Saturday, Sunday and any day
which shall be in Nevada, Texas or the City of New York a legal holiday or a day
on which banking institutions are authorized by law or other governmental
actions to close.
"Capital Expenditures" means all expenditures by the Borrower or a
Subsidiary for the acquisition or leasing (pursuant to a Capital Lease) of
assets or additions to equipment (including replacements, capitalized repairs
and improvements) which are required to be capitalized under GAAP, and in any
event shall include Maintenance Capital Expenditures and Renovation Capital
Expenditures (it being agreed that up to $9,000,000 of such Renovation
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Capital Expenditures are not required to be capitalized under GAAP) .
"Capital Lease" means any lease of Property by the Borrower or a
Subsidiary that, in accordance with GAAP, is required to be reflected as a
liability on the balance sheet of the Borrower or such Subsidiary.
"Capital Lease Obligations" means as to any Person, the obligations
of such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and, for the purposes of this Agreement, (i) the amount of such obligations at
any time shall be the capitalized amount thereof at such time determined in
accordance with GAAP and (ii) shall exclude obligations of the Borrower or any
Subsidiary to Northwind under the Energy Service Agreement.
"Carry-Over Cash Flow Amount" means at any time after the Initial
Excess Cash Flow Principal Payment Date, the Excess Cash Flow for the
immediately prior period of two Fiscal Quarters that was not distributed to the
Term Loan A Lenders or spent or distributed by the Borrower for purposes
permitted by this Agreement, and shall specifically exclude the Reserve Amount
and the Operating Cash Reserve Amount.
"Carry-Over Reserve Amount" means for any Fiscal Quarter, the
Reserve Amount for all prior Fiscal Quarters.
"Cash Interest Expense" means, with respect to the Borrower for any
period, Interest Expense for such period less all non-cash items constituting
Interest Expense during such period (including, without limitation, amortization
of debt discounts, Closing Date fees and expenses and payments of interest on
Debt by issuance of Debt) determined in accordance with GAAP.
"Casino" means the portion of the Premises operated as a casino,
including entertainment and music areas, but excluding the Hotel Premises.
"Casualty Event" means the damage, destruction or Taking, as the
case may be, of Property, or any part thereof, of the Borrower or any
Subsidiary.
"Change of Control" means (i) if at any time the Persons designated
by the Bay Harbour Investor, any Hotel Investor, the Xxxx Investor and the
Lenders as managers or directors of the Borrower cease for any reason to
constitute a majority of the directors or managers of the Borrower then in
office (if any), (ii) the Investor Group shall cease to directly or indirectly
own and control beneficially and of record, free and clear of all Liens, other
encumbrances or, unless otherwise (A) set forth in the Organizational Documents
of the Borrower or any Guarantor provided to the Agent in accordance with
Section 5.1(q) or any entity (x) formed by the Investor Group, (y) that directly
or indirectly holds any Equity Interest in any Guarantor or the Borrower and (z)
whose Organizational Documents have been approved in writing by the Agent
(acting at
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the reasonable direction of the Required Lenders) prior to the Closing Date or
(B) approved in writing by the Agent (acting at the reasonable direction of the
Required Lenders), voting agreements, restrictions or trusts of any kind, Equity
Interests of the Borrower entitling it, at the time a determination is made
hereunder, to manage and control the operations (either through control of a
board of directors or otherwise) of the Borrower, (iii) either (x) the Bay
Harbour Investor and the Xxxx Investor shall cease to directly or indirectly own
and control at least 50% of all Equity Interests with voting rights of the
Borrower, free and clear of all Liens, other encumbrances, or, unless otherwise
(A) set forth in the Organizational Documents of the Borrower or any Guarantor
provided to the Agent in accordance with Section 5.1(q) or any entity (x) formed
by the Investor Group, (y) that directly or indirectly holds any Equity Interest
in any Guarantor or the Borrower and (z) whose Organizational Documents have
been approved in writing by the Agent (acting at the reasonable direction of the
Required Lenders) prior to the Closing Date or (B) approved in writing by the
Agent (acting at the reasonable direction of the Required Lenders), voting
agreements, restrictions or trusts of any kind or (y) the Bay Harbour Investor,
the Xxxx Investor and any Hotel Investor or any Person that replaces such Hotel
Investor with the prior written consent of the Agent (acting upon the reasonable
direction of the Required Lenders) pursuant to the terms of this Agreement shall
cease to directly or indirectly own and control at least 50% of all Equity
Interests with voting rights of the Borrower, free and clear of all Liens, other
encumbrances, or unless otherwise set forth in the Organizational Documents of
the Borrower or approved in writing by the Agent (acting at the reasonable
direction of the Required Lenders), voting agreements, restrictions or trusts of
any kind, (iv) the Borrower shall cease to directly own 100% of all Equity
Interests of its Subsidiaries; or (v) if at any time the Mezzanine Lender
obtains management control of the Borrower pursuant to the Mezzanine Investor
Rights Agreement. For purposes of clarity, the exercise of any warrants by the
Mezzanine Lender or any other Person shall be included in determining the
applicability of the above provisions of this definition.
"Chapter 11 Case" means Aladdin's case pending in the Bankruptcy
Court under Chapter 11 of the Bankruptcy Code.
"Closing Date" means the date on which the conditions precedent set
forth in Article 5 shall have been satisfied or waived by the Agent or the
Borrower, as applicable.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means all Property of the Loan Parties (other than
Holdings), now owned or hereafter acquired, including, without limitation, the
Mortgaged Property, but excluding the Excluded Assets and those contracts,
leases and agreements described on Schedule 6.1 to the extent any such
contracts, leases, and agreements are unassignable under applicable legal
requirements or without the written consent of another Person unless consent
from the relevant party or parties has been obtained and under the terms of
which contract, lease, or agreement any such assignment or grant of a security
interest therein in the absence of such consent would, or could, result in a
breach thereof, but only to the extent that (y) such rights are subject to such
contractual or legal restriction and (z) such restriction is not, or could not
be, rendered ineffective pursuant to the Uniform Commercial Code or any relevant
jurisdiction or
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any other applicable law (including the Bankruptcy Code) or principles of
equity.
"Commitment" means, for each Lender, the amount (i) set forth
opposite such Lender's name on Exhibit A of this Agreement with respect to Term
Loans or (ii) pursuant to a written assignment agreement pursuant to Section
11.13(b) or other agreement, under which a Person becomes a Lender, the amount
of Commitment so agreed to by such new Lender and an existing Lender, in each
case as may be reduced from time to time in accordance with the terms hereof.
"Comparable Standards" means (a) with respect to the Hotel Premises,
the standards of management, operation and maintenance of a first-class hotel of
a like quality to the Xxxx Disney World Dolphin located at 0000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx Xxxxx Xxxxx, Xxxxxxx 00000 or in the event that the Agent
(acting upon the reasonable direction of the Required Lenders) determines that
the Xxxx Disney World Dolphin is closed or no longer maintains the same
standards as it did on the date of the Purchase and Sale Agreement, a Sheraton
hotel located in a major city of the United States that is a vacation
destination center at a prime location as reasonably determined by the Agent
which is comparable to the Hotel Premises in location, size, facilities, quality
and nature (or in the event that the Borrower has entered into a Management
Agreement with a Manager other than Sheraton, a hotel operated by such Manager
that the Agent (acting upon the reasonable direction of the Required Lenders)
determines is similar to the Xxxx Disney World Dolphin, (b) with respect to the
Retail Shops, the standards of management, operation and maintenance of a
first-class retail shopping center which is comparable to the Retail Shops in
location, size, tenant composition, facilities, quality and nature, (c) with
respect to the Casino, the standards of management, operation and maintenance of
a first-class casino which is comparable to the Casino in location, size,
facilities, quality and nature, and (d) with respect to the Theater, the
standards of management, operation and maintenance of a first- class theater
which is comparable to the Theater in location, size, facilities, quality and
nature.
"Condition of the Business" means the financial condition and
results of operations of the Business or the Collateral (taken as a whole).
"Confirmation Order" means the order of the Bankruptcy Court
confirming the Plan of Reorganization in the Chapter 11 Case dated August 29,
2003 and attached hereto as Exhibit H.
"Consent Letter- 2003" means the (i) letter agreement dated as of
April 23, 2003 by the Borrower and agreed and acknowledged by the representative
of the steering committee, which refers to, inter alia, the draft Management
Agreement, Manager Subordination Agreement and chief executive officer agreement
and (ii) letter agreement dated as of May 7, 2003 by the Borrower and agreed and
acknowledged by the representative of the steering committee, which refers to,
inter alia, the draft License Subordination Agreement.
"Consent Letter- 2004" means that certain letter agreement dated as
of August 9, 2004 by the Borrower and agreed and acknowledged by the
representative of the steering committee, which refers to, inter alia, the
August 9, 2004 draft Mezzanine Loan Documents and
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License Agreement.
"Consolidated" means, in respect of any Person, as applied to any
financial or accounting term, such term determined on a consolidated basis in
accordance with GAAP (except as otherwise required herein) for such Person and
all of its Consolidated Subsidiaries thereof.
"Debt" means, without duplication, with respect to the Borrower and
its Consolidated Subsidiaries: (a) all obligations of such Person for borrowed
money or for the deferred purchase price of Property or services (other than
current accounts payable incurred in the ordinary course of business, and
accrued expenses and liabilities incurred in the ordinary course of business),
and all obligations evidenced by bonds, debentures, notes, or similar
instruments, and any other obligations which, in accordance with GAAP, are
required to be shown as a liability on such Person's balance sheet; (b) all
obligations and liabilities of any Person secured by any Lien on the Property of
the Borrower or any Subsidiary, with respect to which obligations and
liabilities neither the Borrower nor any of its Consolidated Subsidiaries shall
have assumed or become liable for the payment thereof; provided, however, that
all such obligations and liabilities which are limited in recourse to such
Property shall be included in Debt only to the extent of the book value of such
Property that would be shown on a Consolidated balance sheet of the Borrower and
its Consolidated Subsidiaries prepared in accordance with GAAP; (c) all
obligations or liabilities created or arising under any Capital Lease or
conditional sale or other title retention agreement with respect to Property
used or acquired by the Borrower or any of its Consolidated Subsidiaries, even
if the rights and remedies of the lessor, seller or lender thereunder are
limited to repossession of such Property; provided, however, that all such
obligations and liabilities which are limited in recourse to such Property shall
be included in Debt only to the extent of the book value of such Property that
would be shown on a Consolidated balance sheet of the Borrower and its
Subsidiaries prepared in accordance with GAAP; (d) all obligations and
liabilities under Guaranties, indemnities, and for reimbursement in connection
with letters of credit and surety bonds; and (e) all Hedge Obligations. For the
purposes of this Agreement, the Debt of any Person shall include the proportion
of Debt of any partnership in which such Person is a general partner or joint
venturer with liability for the indebtedness of such Person but only to the
extent of such Person's interest in such general partnership or joint venture.
For purposes of clarity, the parties hereto agree that "Debt" shall specifically
exclude the obligations of the Borrower to Northwind pursuant to the Energy
Services Agreement.
"Developer" has the meaning given to such term in Section 8.23.
"Disclosure Schedule" means the disclosure schedule attached to the
Representation and Warranty Certificate.
"Disposition" means with respect to any Property, any sale, lease,
sale and leaseback, assignment, conveyance, transfer (including as a result of a
Taking), contribution or other disposition thereof.
8
"Distribution" means, in respect of any corporation, partnership,
joint venture, limited liability company or similar business entity: (a) the
payment or making of any dividend (other than a dividend in stock or in the
right to acquire stock), payment, preferred return or other distribution of
Property (including, without limitation, the issuing or granting of warrants to
purchase Equity Interests) in respect of or in connection with its Equity
Interests or any other profit participation or economic interests; or (b) the
redemption, repurchase or other acquisition of (i) any of its Equity Interests,
(ii) any of its securities or debt instruments convertible into such Equity
Interests, or (iii) any option, warrant, or other right to acquire such Equity
Interests.
"Dollars" and "$" mean the lawful currency of the United States of
America.
"Xxxx Investor" has the meaning given to such term in the definition
of "Investor Group".
"EBITDA" means with respect to the Borrower for any period, without
duplication, (a) the sum of (i) Net Income, (ii) Interest Expense, (iii)
federal, state and local income taxes deducted in determining Net Income, and
(iv) depreciation and amortization and other non-cash items properly deducted in
determining Net Income, in each case on a consolidated basis for the Borrower
and its Subsidiaries for such period, calculated on a consolidated basis in
accordance with GAAP, minus (b) non-cash items properly added in determining Net
Income for such period (calculated on a Consolidated basis in accordance with
GAAP). Any and all payments made by the Borrower to Northwind in cash pursuant
to the Energy Services Agreement shall be deemed to be operating expenses of the
Borrower for the purpose of determining EBITDA.
"EBITDA Cure Amount" has the meaning given to such term in Section
8.13(b).
"Effective Date" has the meaning given to such term in the Plan of
Reorganization.
"Eligible Assignee" means, with respect to any assignment of the
rights, interests and obligations of a Lender hereunder, a Person that (a) is at
that time of such assignment (i) a commercial bank, a finance company, insurance
company, fund or other financial institution, in each case of the foregoing
cases having a net worth or combined capital and surplus of at least
$750,000,000, (ii) an investment company whose shares are publicly traded and
who has at least $250,000,000 of assets, (iii) a successor (whether by transfer
of all or substantially all of assets, merger, consolidation or otherwise) to
the assigning Lender, (iv) is a Lender as of the date of this Agreement, or (v)
any other entity approved in writing by both the Borrower (so long as no Event
or Event of Default has occurred and is continuing) and the Agent; provided,
however, that no Person shall be an Eligible Assignee if such Person would at
the time of any such assignment subject the Borrower to liability under Section
3.7, 3.8, 3.9 or 3.11 of this Agreement, and (b) so long as no Event or Event of
Default shall have occurred and be continuing, is not, at the time of such
assignment, an entity that operates casinos or is a substantial holder of equity
in an entity that operates casinos or casino/hotels (any such entity shall be
referred to herein as a "Competitor") (the determination of whether any assignee
or proposed assignee is a Competitor
9
to be made in good faith by the Borrower or the board of directors or managers
of the Borrower, if any or the relevant member of the Investor Group, as the
circumstances require, acting in a reasonable and timely manner); provided,
however, that in no event shall a Person who is a Lender as of the date of this
Agreement at any time constitute a Competitor.
"Energy Premises" means the real property on which the utility plant
owned and operated by Northwind is located and the adjoining optional
improvement site as described on Exhibit B-1 and the Borrower's right, title and
interest in such utility plant.
"Energy Premises Lease" means that certain lease, dated December 3,
1997, as amended to date, between Northwind and Aladdin as amended by the
Settlement Agreement and assumed by Aladdin pursuant to the order of the
Bankruptcy Court dated December 9, 2002 and assigned to the Borrower under the
Purchase and Sale Agreement.
"Energy Service Agreement" means that certain Energy Service
Agreement dated as of September 24, 1998 by and between Aladdin and Northwind as
amended by the Settlement Agreement and assumed by Aladdin pursuant to the order
of the Bankruptcy Court dated December 9, 2002 and assigned to the Borrower
under the Purchase and Sale Agreement.
"Environmental Claim" means a claim, however asserted, by any
Governmental Authority or other Person alleging potential liability on the part
of the Borrower or any of its Subsidiaries for violation of or liability under
any Environmental Law or for release or injury to the environment or threat to
public health, personal injury (including sickness, disease or death), property
damage, natural resources damage, or otherwise alleging liability for damages,
punitive damages, cleanup costs, removal costs, remedial costs, response costs,
restitution, civil or criminal penalties, injunctive relief, or other type of
relief, resulting from or based upon (a) the presence, placement, discharge,
emission or release (including intentional or unintentional, negligent or
non-negligent, sudden or non-sudden, accidental or non-accidental placement,
spill, leak, discharge, emission or release) of any Hazardous Material at, in or
from property, whether or not owned by the Borrower or any of its Subsidiaries,
or (b) any other circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law.
"Environmental Indemnity" means that certain Environmental Indemnity
dated as of the Closing Date made by the Borrower and the Investor Group for the
benefit of Agent and Lenders substantially in the form attached hereto as
Exhibit P; provided that, the Investor Group shall not be obligated to provide
such Environmental Indemnity solely in the event that the Borrower provides
environmental insurance (the "Environmental Insurance") with $20,000,000 of
coverage (with an exclusion for offsite subterranean migrating hydrocarbons) for
a term of six (6) years from the Closing Date and with such other terms and
conditions reasonably satisfactory to the Agent (acting at the reasonable
direction of the Required Lenders).
"Environmental Laws" means all federal, state and local laws, rules,
regulations, ordinances, and consent decrees relating to health, safety,
hazardous substances, and environmental matters applicable to the business and
facilities of the Borrower or a Subsidiary (in each case whether or not owned by
it). Such laws and regulations include but are not limited to the
10
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., as
amended; the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. Section 9601 et seq., as amended; the Toxic Substances Control
Act, 15 U.S.C. Section 2601 et seq., as amended; the Oil Pollution Act, 33
U.S.C. Section 2701 et seq., as amended; the Clean Air Act, 42 U.S.C. Section
7401 et seq., as amended; the Hazardous Material Transportation Act, 49 U.S.C.
Section 1801 et seq.; the Federal Water Pollution Control Act, 33 U.S.C. Section
1251 et seq.; the Occupational Safety and Health Act, 29 U.S.C. Section 651 et
seq.; the Nevada Hazardous Materials law (NRS Chapter 459); the Nevada Solid
Waste/Disposal of Garbage or Sewage law (NRS 444.440 to 444.650, inclusive); the
Nevada Water Controls/Pollution law (NRS Chapter 445A); the Nevada Air Pollution
law (NRS Chapter 445B); the Nevada Cleanup of Discharged Petroleum law (NRS
590.700 to 590.920, inclusive); the Nevada Control of Asbestos law (NRS 618.750
to 618.850, inclusive); the Nevada Appropriation of Public Waters law (NRS
533.324 to 533.4385, inclusive); and the Nevada Artificial Water Body
Development Permit law (NRS 502.390).
"Equipment" means, with respect to the Borrower or any other Loan
Party (other than Holdings), all of such Person's now owned and hereafter
acquired machinery, equipment, furniture, furnishings, fixtures, and other
tangible personal property, including, without limitation, Gaming Equipment,
data processing hardware and software, computers, motor vehicles, trailers,
aircraft, tools, office equipment, store fixtures, and leasehold improvements,
as well as all of such Person's rights and interests with respect thereto under
such leases of such types of personal property (including, without limitation,
options to purchase); together with all component and auxiliary parts and
supplies owned by such Person and used or to be used in connection therewith,
and all substitutes for any of the foregoing, all manuals, drawings,
instructions, warranties and rights with respect thereto owned by such Person,
and all proceeds and general intangibles relating to all of the foregoing,
including without limitation any claims against third parties for loss or
damage.
"EquityCo" means EquityCo, L.L.C., a Nevada limited liability
company.
"Equity Interests" means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person, and any
warrants, options or other rights entitling the holder thereof to purchase or
acquire any such equity interest.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended, and the rules and regulations promulgated thereunder, as in effect
from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) which together with the Borrower or any of its Subsidiaries would
be treated as a single employer under the provisions of Title I or Title IV of
ERISA.
"Eurodollar Business Day" means any Business Day on which dealings
in Dollar deposits in the interbank Eurodollar market may be carried on in
London, England, Nevada and New York, New York.
11
"Eurodollar Loans" means Loans bearing interest at the Term Loan A
Eurodollar Rate or the Term Loan B Eurodollar Rate, as the case may be.
"Event" means any event or condition which, with notice, the passage
of time, or any combination thereof, would constitute an Event of Default.
"Event of Default" has the meaning given to such term in Section 9.1
of this Agreement.
"Excess Cash Flow" means, with respect to the Borrower for any
Fiscal Quarter:
(i) EBITDA for such Fiscal Quarter,
plus
(ii) the EBITDA Cure Amount, if any, paid during such Fiscal
Quarter,
plus
(iii) the Carry-Over Cash Flow Amount, if any,
less
(iv) the Cash Interest Expense of the Borrower and its Subsidiaries
paid during such Fiscal Quarter,
less
(v) the aggregate amount of any Maintenance Capital Expenditures
paid in cash during such Fiscal Quarter (subject to the
limitations set forth in Section 8.12 and expressly excluding
the additional $3,000,000 of Capital Expenditures permitted to
be made in the second paragraph of Section 8.12),
less
(vi) all payments of principal on the Term Loan A pursuant to (A)
Section 4.1(b) (x) made by the Borrower during such Fiscal
Quarter solely to the extent any such payments were not
previously deducted in determining the Excess Cash Flow in a
prior period and (y) to be made by the Borrower in the
immediately following consecutive Fiscal Quarter, (B) Section
4.2 made by the Borrower during such Fiscal Quarter, and (C)
Section 4.3(a) made by the Borrower during such Fiscal Quarter
solely to the extent that any amounts received by the Borrower
pursuant to Section 4.3(a) were included in EBITDA for such
Fiscal Quarter,
12
less
(vii) the amount of any Taxes paid in cash by the Borrower and its
Subsidiaries during such Fiscal Quarter or if the Borrower is
treated as a pass-through entity or is not treated as a
separate entity for United States federal income tax purposes,
the amount of Distributions made in cash by the Borrower in
accordance with Section 8.2(c) (Distributions) during such
Fiscal Quarter,
less
(viii) the amount of any additions during such Fiscal Quarter to the
Operating Cash Reserve Amount permitted under Section 8.27 of
this Agreement, and
less
(ix) the amount of any cash Distributions made by the Borrower to
its Members pursuant to Section 8.2(d) during such Fiscal
Quarter (up to an aggregate maximum amount of $1,500,000 for
such Fiscal Quarter).
Excess Cash Flow shall be computed to avoid duplication of additions and
subtractions made in calculating EBITDA so as to prevent the double counting of
any such additions and subtractions in a Fiscal Quarter. In addition, any
amounts subtracted from EBITDA in determining Excess Cash Flow shall not be
subtracted in any calculation of Excess Cash Flow for any subsequent Fiscal
Quarter.
"Excess Interest Amount" has the meaning given to such term in
Section 3.1(a)(ii) of this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, including all rules and regulations issued thereunder.
"Excluded Assets" has the meaning given to such term in the Security
Agreement.
"FF&E Lender" means General Electric Capital Corporation (for both
its Term Loan A Loan and its Term Loan B Loan), GMAC Commercial Mortgage
Corporation (for both its Term Loan A Loan and its Term Loan B Loan), OCM Real
Estate Opportunities Fund II, L.P. (for its Term Loan A in the initial amount of
$12,956,061 and its Term Loan B).
"FF&E Lender Appraisal" means a written appraisal report of the Time
Share Premises, as the term "appraisal" is defined in the Code of Professional
Ethics of the American Institute of Appraisers, meeting the requirements of the
Federal Institutions Reform, Recovery and Enforcement Act of 1989, as amended,
prepared by a professional appraiser retained at the joint and equal expense of
the FF&E Lender (50%) and the Term Loan A Lenders (other than the FF&E Lender)
(50%), who is a member of the American Institute of Appraisers, addressed to the
13
Term Loan A Lenders, setting forth such appraiser's determination of the fair
market value of the Time Share Premises as of the Closing Date and based upon
the highest and best use of the Time Share Premises as developed (without regard
to any contractual restrictions on development of such Property, including,
without limitation, the REA).
"Facility" means the Term Loan Commitments and the Term Loans deemed
to be made thereunder.
"Fair Market Value" means the price at which a willing buyer under
no compulsion to buy would purchase Property from a willing seller under no
compulsion to sell in a transaction under customary terms and conditions for the
time and location, as determined in good faith by the Agent (acting upon the
direction of the Required Term Loan A Lenders) and in the context of the Time
Share Premises shall be based upon a transaction meeting the above criteria and
shall also assume the highest and best use of the Time Share Premises (without
regard to any contractual restrictions on development or operation of the Time
Share Premises, including, without limitation, the REA).
"Fifth Measurement Period" has the meaning set forth in Section
8.13(a) of this Agreement.
"Filing Date" means September 28, 2001.
"Final Order" means an order of the Bankruptcy Court or other court
having jurisdiction over the Chapter 11 Case (a) as to which the time to appeal,
petition for certiorari or move for reargument or rehearing has expired and as
to which no appeal, petition for certiorari or other proceedings for reargument
or rehearing shall then be pending, or (b) if an appeal, writ of certiorari,
reargument or rehearing thereof has been filed or sought, such order of the
Bankruptcy Court shall have been affirmed by the highest court to which such
order was appealed, or certiorari shall have been denied or reargument or
rehearing shall have been denied or resulted in no modification of such order,
and the time to take any further appeal, petition for certiorari or move for
reargument or rehearing shall have expired; provided, however, that the
possibility that a motion under Rule 59 or Rule 60 of the Federal Rules of Civil
Procedure, or any analogous rule under the Federal Rules of Bankruptcy
Procedure, may be filed with respect to such order shall not cause such order
not to be a Final Order.
"Financing Statements" means financing statements in accordance with
the applicable uniform commercial code to be filed with the appropriate state
and/or county offices for the perfection of a security interest in the
Collateral.
"First Measurement Period" has the meaning given to such term in
Section 8.13(a) of this Agreement.
"First Renovation Capital Expenditure Measurement Date" means the
second Anniversary Date.
14
"Fiscal Quarter" means any of the quarterly accounting periods of
the Borrower, ending on March 31, June 30, September 30 and December 31 of each
year; references to FQ with a following number (e.g., FQ1) refer to the number
of Fiscal Quarters then to have elapsed in whole or in part since the Closing
Date.
"Fiscal Year" means the Borrower's Fiscal Year for financial
accounting purposes, which ends on December 31 of each year. Any reference in
this Agreement to "Fiscal Year" immediately followed by a specific year (e.g.,
Fiscal Year 2004) means the Fiscal Year ending on December 31 of such year.
"Fourth Measurement Period" has the meaning set forth in Section
8.13(a) of this Agreement.
"Funded Debt" means, as to any Person, all Debt described in the
definition of "Debt" (other than clauses (d) and (e) of such definition) with
respect to such Person that matures more than one year from the date of its
creation or matures within one year from such date but is renewable or
extendible, at the option of such Person, to a date more than one year from such
date or arises under a revolving credit or similar agreement that obligates the
lender or lenders to extend credit during a period of more than one year from
such date, including, without limitation, all current maturities and current
sinking fund payments in respect of such Debt whether or not required to be paid
within one year from the date of its creation and, in the case of the Borrower,
such Debt in respect of the Loans.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time and consistently applied.
"Gaming Authority" means any of the Nevada Gaming Commission, the
Nevada State Gaming Control Board, the Xxxxx County Liquor and Gaming Licensing
Board and any other gaming regulatory body or any agency which has, or may at
any time after the Closing Date have, jurisdiction over the gaming activities of
the Premises or any successor to such authority.
"Gaming Equipment" means the gaming equipment and gaming devices
which are regulated gaming devices under any Gaming Laws (including but not
limited to slot machines, gaming tables, cards, dice, cashless wagering systems
and tangible associated equipment (as defined in NRS 463.0136) together with all
improvements and/or additions thereto.
"Gaming Laws" means the provisions of the Nevada Gaming Control Act,
as amended from time to time, all regulations of the Nevada Gaming Commission
promulgated thereunder, as amended from time to time, the provisions of the
Xxxxx County Code, as amended from time to time, and all other laws, statutes,
rules, rulings, orders, ordinances, regulations and other Legal Requirements of
any Gaming Authority.
"Gaming License" means any license, qualification, franchise,
accreditation, approval, registration, permit, finding of suitability or other
authorization relating to gaming, the
15
gaming business or the operation of a casino under the Gaming Laws or required
by the Gaming Authorities or otherwise necessary for the operation of gaming,
the gaming business or a resort casino.
"GECC Facilities Loan Documents" means the GECC Facilities Agreement
and all agreements, documents and instruments executed and/or delivered by
Aladdin and/or its Affiliates in connection therewith.
"Governmental Authority" means any national, state or local
government (whether domestic or foreign), any political subdivision thereof or
any other governmental or judicial, authority, body, agency, bureau or entity
(including the Gaming Authorities, any zoning authority, the Federal Deposit
Insurance Corporation, the Comptroller of the Currency or the Board, any central
bank or any comparable authority) or any arbitrator with authority to bind the
party at law.
"Guaranty" by any Person means all obligations of such Person which
in any manner directly or indirectly guarantee the payment or performance of any
indebtedness, dividend or other obligation of any other Person (the "guaranteed
obligations"), or assure or in effect assure the holder of the guaranteed
obligations against the payment or performance of all or any part of such
guaranteed obligations, including, without limitation, the Holdings Guarantee
and any such obligations incurred through an agreement: (a) to purchase the
guaranteed obligations or any Property constituting security therefor; or (b) to
advance or supply funds for the purchase or payment of the guaranteed
obligations or to maintain a working capital or other balance sheet condition.
"Guarantor" means Holdings and each Subsidiary of the Borrower
existing on the date hereof and each Subsidiary of the Borrower which becomes a
guarantor of the Obligations after the date hereof.
"Hazardous Material" means any of those substances which are
regulated by, or which may form the basis of liability under, any Environmental
Law, including, without limitation, all substances identified under any
Environmental Law as a pollutant, contaminant, waste, solid waste, hazardous
waste, hazardous constituent, special waste, hazardous substance, hazardous
material, or toxic substance, or petroleum or petroleum-derived substance or
waste, and including, without limitation, any petrochemical or petroleum
products, radioactive materials, asbestos in any form which is friable, UREA
formaldehyde foam insulation, transformers or other equipment that contains
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas.
"Hedge Obligations" means all indebtedness and obligations of the
Borrower set forth on any balance sheet of the Borrower furnished to the Agent
pursuant to Section 7.2 of this Agreement in connection with interest rate
swaps, caps or collar agreements or similar agreements entered into by the
Borrower with any Lender (or an Affiliate of any Lender) in connection with this
Agreement, providing for protection against fluctuations in interest rates or
currency exchange rates or the exchange of nominal interest obligations, either
generally or under
16
specific contingencies. "Hedge Obligations" expressly excludes any and all of
the foregoing Hedge Obligations related to, or arising out of, or in connection
with the Pre-Petition Credit Agreement (except to the extent amended and
restated hereunder) or the GECC Facilities Agreement (except to the extent
amended and restated hereunder).
"Hedging Agreements" means any and all agreements or documents
evidencing any Hedge Obligations.
"Holdings" means MezzCo, L.L.C., a Nevada limited liability company.
"Holdings Guarantee" means the Guarantee by Holdings of the
Obligations substantially in the form of Exhibit M hereto, as amended, modified
or supplemented from time to time.
"Hotel Investor" means any Person (other than the Xxxx Investor and
the Bay Harbour Investor) approved in writing by the Agent (acting at the
reasonable direction of the Required Lenders) to hold Equity Interests, directly
or indirectly of Holdings and/or the Borrower and in any event shall include
Starwood if Sheraton becomes the Manager.
"Hotel Premises" means the portion of the Premises operated as a
hotel, including all rooms and suites, amenities, restaurants, conference
centers, meeting, banquet and other public rooms, spa, parking spaces and other
facilities of the hotel portion of the Premises, but excluding the Casino.
"Identified Hotel Manager" means any of Sheraton, Hilton Hotels
Corporation, Hyatt Corporation, Marriott International Inc. or Xxxx'x Hotels
Holding Corporation (or any Affiliate of any of the foregoing primarily engaged
in the management of hotels of at least a like quality to a Sheraton), or any
replacement of comparable standing in the hotel management industry that is (i)
acceptable to the Agent acting at the reasonable direction of the Required
Lenders and (ii) identified on a list delivered to the Agent by the Borrower no
more frequently than once every two years, commencing on the second Anniversary
Date.
"Indemnified Loss" has the meaning given to such term in Section
11.8 of this Agreement.
"Indemnitee" has the meaning given to such term in Section 11.8 of
this Agreement.
"Initial Default Rate" has the meaning given to such term in Section
3.3 of this Agreement.
"Initial Excess Cash Flow Principal Payment Date" has the meaning
set forth in Section 4.1(a) of this Agreement.
"Initial Interest Period" means the period commencing on the Closing
Date and
17
ending on the third Anniversary Date.
"Initial Operating Cash Reserve Amount" means $10,000,000 of the
amount of cash transferred to the Borrower by Aladdin pursuant to Section
2.01(a)(xvi) of the Purchase and Sale Agreement.
"Initial Time Share Premises Payment" has the meaning set forth in
Section 4.3(d) of this Agreement.
"Insolvency" means, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section 4245 of
ERISA.
"Insolvent" means pertaining to a condition of Insolvency.
"Insurance Policies" means, in addition to any insurance required to
be maintained by the Borrower or any Subsidiary under any Operating Agreement,
Lease or other Loan Document, the insurance policies described in Section U of
the Disclosure Schedule.
"Interest Coverage Ratio" means, with respect to the Borrower and
its Subsidiaries on a consolidated basis for any period, the ratio of (i) EBITDA
for such period to (ii) the Cash Interest Expense for such period.
"Interest Expense" means, with respect to the Borrower for any
period, the aggregate interest expense of the Borrower and its Consolidated
Subsidiaries during such period determined on a Consolidated basis, and shall in
any event include, without limitation, (i) the amortization of debt discounts,
(ii) the amortization of all fees payable in connection with the incurrence of
Debt to the extent included in interest expense and (iii) the portion of any
Capital Lease Obligation allocable to interest expense (recognizing that, in any
event, no portion of "Debt Service" or "Return on Equity" under the Energy
Service Agreement shall be treated as interest expense on Capital Lease
Obligations, regardless of GAAP, but instead shall be treated as a component of
EBITDA as set forth in the definition of EBITDA).
"Interest Payment Date" means with respect to any Loan, the first
Business Day of each month immediately following the end of a Fiscal Quarter
(i.e. on or about April 1, July 1, October 1 and January 1).
"Interest Period" means, with respect to each Eurodollar Loan:
(i) initially, the period commencing on the date such Eurodollar
Loan is made and ending on the numerically corresponding date three months
thereafter; and
(ii) thereafter for each renewal of such Loan, the period
commencing on the last day of the next preceding Interest Period for such Loan
and ending three months thereafter;
provided that: (A) any such Interest Period which would otherwise end on a day
which is not a
18
Eurodollar Business Day shall be extended to the next succeeding Eurodollar
Business Day (and interest shall accrue and be payable for the period of such
extension) unless such next succeeding Eurodollar Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Eurodollar Business Day; and (B) any such Interest Period which begins
on the last Eurodollar Business Day of any calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Eurodollar Business Day of a
calendar month.
"Investor Group" means, collectively, Xxxxxx Xxxx, an individual
resident in the State of Florida, or one or more Affiliates of such individual
(the "Xxxx Investor"), Bay Harbour Management, LC, a Florida company, or an
Affiliate thereof (the "Bay Harbour Investor"), and, at the option of the Xxxx
Investor and the Bay Harbour Investor, a Hotel Investor or any successor to any
of such Persons that the Agent has approved in writing (upon the reasonable
direction of the Required Lenders) pursuant to the terms of this Agreement.
"IRS" means the Internal Revenue Service or any successor.
"Knowledge" means the actual knowledge of an Approved Officer or
director of the Borrower.
"Last Ended Fiscal Quarter" has the meaning given to such term in
Section 7.2(f) of this Agreement.
"Leases" means, collectively, all space leases, occupancy
agreements, subleases, licenses, Permits, concessions or other agreements or
arrangements, whether written or oral, and all agreements for the use or
occupancy of all or any portion of the Premises, entered into by the Borrower or
by any Person on behalf of the Borrower or assumed by Aladdin and assigned to
the Borrower in connection with the Purchase and Sale Agreement or the
Confirmation Order, together with any and all extensions or renewals thereof,
excluding room rentals.
"Leasing Manager" means any leasing manager designated by the
Borrower pursuant to a Leasing Services Agreement and approved in writing by the
Agent (acting at the reasonable direction of the Required Term Loan A Lenders)
prior to the retention thereof.
"Leasing Manager Subordination Agreement" means a Leasing Manager
Subordination and Cooperation Agreement entered into between the Agent and the
Leasing Manager and consented to by the Borrower which consent shall not be
unreasonably withheld or delayed, and in form and substance reasonably
satisfactory to the Agent (acting at the direction of the Required Lenders).
"Leasing Services Agreement" means any contract or agreement
pursuant to which any Person other than the Borrower or an employee of the
Borrower is granted authority to manage the leasing of the Retail Shops or any
other portion of the Premises.
"Legal Requirements" means all laws, ordinances, rules, regulations,
codes,
19
statutes, orders, permits, licenses, authorizations, directives and requirements
of any Governmental Authority applicable to the Borrower, any Manager, any
casino operator, the Lenders or the Premises or any portion thereof, including
all applicable licenses, building codes, rent stabilization laws, zoning,
planning, use and subdivision ordinances, flood disaster, health, safety and
environmental laws and regulations, and the Americans with Disabilities Act of
1990, Pub. L. No. 89-670, 104 Stat. 327 (1990), as amended, and all regulations
promulgated pursuant thereto.
"Lender" has the meaning given to such term in the recitals to this
Agreement.
"Lending Office" means, with respect to a Lender, the office of such
Lender in the United States designated as its "Lending Office" opposite its name
on the signature pages of this Agreement, or such other office in the United
States as such Lender may from time to time specify to the Borrower and the
Agent.
"Letter of Credit" means one or more unconditional irrevocable
stand-by letters of credit issued in favor of the Agent (for the benefit of the
Lenders) in form and issued by a financial institution reasonably satisfactory
to the Required Term Loan A Lenders and which when taken together with the
amounts in the Renovation Capital Expenditure Account and Theater Renovation
Account shall support the Borrower's obligations to make $90,000,000 of
Renovation Capital Expenditures as provided in Section 4.3(b) and Section 7.13
hereof (it being understood that the stated face amount of all Letters of Credit
may be reduced from time to time after Renovation Capital Expenditures are made
so long as the stated face amount of any remaining Letters of Credit plus the
amount of funds in the Renovation Capital Expenditure Account and Theater
Renovation Account is at least equal to the amount of Renovation Capital
Expenditures still required to be made (after giving effect to any reduction of
the stated face amount of any Letter of Credit) pursuant to Section 4.3(b)).
"Leverage Ratio" with respect to the Borrower means the ratio of (i)
Funded Debt as at such date to (ii) EBITDA for the period of four Fiscal
Quarters (or if a lesser number of periods has elapsed from the Closing Date,
EBITDA annualized based on the number of Fiscal Quarters that have elapsed from
the Closing Date) most recently ended on or prior to such date.
"LIBOR" means, with respect to each day during each Interest Period,
the rate per annum determined on the basis of the rate for deposits in Dollars
for a period equal to such Interest Period commencing on the first day of such
Interest Period appearing on Page 3750 of the Dow Xxxxx Markets screen as of
11:00 A.M., London time, two Eurodollar Business Days prior to the first day of
such Interest Period. In the event that such rate does not appear on Page 3750
of the Dow Xxxxx Markets screen (or otherwise on such screen), LIBOR for
purposes of this definition shall be determined by reference to such other
comparable publicly available service for displaying Eurodollar rates as may be
reasonably selected by the Agent or, in the absence of such availability, by
reference to the rate at which The Bank of New York is offered Dollar deposits
at or about 11:00 A.M., New York City time, two Eurodollar Business Days prior
to the first day of such Interest Period in the interbank Eurodollar market
where its Eurodollar and foreign currency and exchange operations are then being
conducted for delivery on the first day
20
of such Interest Period for the number of days comprised therein.
"License Agreement" means that certain Amended and Restated Planet
Hollywood Resort & Casino Licensing Agreement dated as of August 9, 2004 among
the Borrower, PHI, PHMemo and PHIV and supplemented by that certain letter
agreement dated as of August 9, 2004 and executed by PHI, PHMemo and PHIV each
attached hereto as Exhibit W.
"License Subordination Agreement" means that certain Amended and
Restated Licensor Subordination and Cooperation Agreement entered into among the
Agent, PHI, PHMemo and PHIV and consented to by the Borrower (which consent
shall not be unreasonably withheld or delayed) and substantially in the form
attached hereto as Exhibit X.
"Lien" means any interest in Property securing an obligation owed
to, or a claim by, a Person other than the owner of the Property, whether such
interest is based on the common law, statute, or contract, and including,
without limitation, (a) a security interest, charge, claim, or lien arising from
a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment,
deposit arrangement, agreement, or conditional sale or a lease, consignment or
bailment for security purposes, or (b) any reservation, exception, encroachment,
easement, right-of-way, condition, restriction or other title exception or
encumbrance affecting Property.
"Loan" means any loan made by any Lender pursuant to this Agreement.
"Loan Documents" means, collectively, this Agreement, the Term Loan
Notes, the Financing Statements, any Security Document, the Environmental
Indemnity (if any), the Subordination Agreements, the Borrower Certificate, the
Representation and Warranty Certificate, any Hedging Agreement, the Holdings
Guarantee, the Mezzanine Intercreditor Agreement, and such other documents,
agreements and instruments evidencing, securing or pertaining to the
Obligations, or any part thereof executed on or about the Closing Date by the
Borrower, any Manager or any other Person or, as shall, from time to time
thereafter be executed and delivered by the Borrower, any Manager or any other
Person, in each case pursuant to or in connection with the Loan or any other
Loan Document. "Loan Documents" shall expressly exclude any and all of the
Pre-Petition Credit Agreement, the GECC Facilities Agreement and any documents
and agreements executed in connection therewith or contemplated thereby, except
to the extent any of the foregoing agreements or instruments have been amended
and restated and signed by the Borrower pursuant to this Agreement or any other
Loan Document.
"Loan Parties" means Holdings, the Borrower and each of the
Borrower's Subsidiaries which is a party to a Loan Document.
"Maintenance Capital Expenditures" means any Capital Expenditures by
the Borrower or any of its Subsidiaries (subject to the granting of a Lien in
favor of the Agent on the assets of any such Subsidiary) that are made to
maintain, restore, replace or refurbish the condition or usefulness of Property
of the Borrower or any of its Subsidiaries, or otherwise to support the
continuation of such Person's day-to-day operations as then conducted, but that
are not properly chargeable to repairs and maintenance in accordance with GAAP.
The amount of
21
Maintenance Capital Expenditures permitted to be made by the Borrower and its
Subsidiaries is subject to Section 8.12 of this Agreement. Maintenance Capital
Expenditures shall for all purposes exclude Renovation Capital Expenditures.
"Management Agreement" means the Management Contract for the Planet
Hollywood Hotel and Casino, a Sheraton Hotel relating to the Hotel Premises
entered into on April 23, 2003 by the Borrower and Sheraton, as Manager, as
amended by the BH/RE-Starwood Agreement and attached hereto as Exhibit U and any
other amendment or modification thereto made in accordance with Section 7.16
hereof or any other management agreement entered into in substitution, amendment
or modification of the foregoing which has been approved in writing by Agent
(acting upon the written direction of the Required Lenders in their reasonable
discretion) pursuant to Section 7.16 hereof prior to the effectiveness thereof.
"Manager" means (a) any Identified Hotel Manager or any other Person
approved in writing by the Agent (acting at the reasonable direction of the
Required Term Loan A Lenders) or (b) any replacement manager designated by the
Borrower and approved in writing by the Agent (acting at the reasonable
direction of the Required Term Loan A Lenders) prior to the retention thereof;
provided, that the consent of the Agent and the Required Lenders shall not be
required in the event that the Borrower replaces any Manager with an Identified
Hotel Manager so long as any such Identified Hotel Manager or other replacement
manager approved by the Agent executes a Manager Subordination Agreement.
"Manager Subordination Agreement" means the Amended and Restated
Manager Subordination and Cooperation Agreement entered into between the Agent
and the Manager and consented to by the Borrower, and substantially in the form
attached hereto as Exhibit V.
"Marketing Fees" has the meaning given to such term in Section 8.23.
"Material Adverse Effect" means an event has occurred or condition
exists that has or would reasonably be expected to have a material adverse
effect on the (i) Condition of the Business, (ii) gaming business (taken as a
whole) conducted by casinos located on the portion of Las Vegas Boulevard in
Xxxxx County, Nevada bounded by Blue Diamond Road at the south end and Oakey
Boulevard at the north end, or (iii) on the validity or enforceability of this
Agreement, the Term Loan Notes, the Security Agreement, the Mortgage, the other
Loan Documents or the rights or remedies of the Agent or the Lenders hereunder
or thereunder; provided, that the material adverse effect was not the direct or
indirect result of (x) any action or inaction of the Borrower or any Subsidiary
or Affiliate of the Borrower taken at the written request of the Agent (acting
upon the reasonable direction of Required Lenders) or (y) the lack of consent by
Boulevard Invest to the proposed Renovation Capital Expenditures set forth in
the Borrower's Plan.
"Material Operating Agreements" means (a) the Operating Agreements
set forth on the Disclosure Schedule (which shall include, without limitation,
the following agreements: the Management Agreement, the Leasing Services
Agreement (if any), the Energy Premises Lease, the Energy Services Agreement,
the Parking Agreement, the REA, the License
22
Agreement, the Restaurant License Agreement and any casino operating agreement
entered into in accordance with Section 8.24 of this Agreement) and any
contracts or agreements entered into in replacement thereof or substitution
therefor, and (b) any other Operating Agreements entered into after the Closing
Date by the Borrower or any Manager or any other Person on their behalf with
respect to the Premises or other Property, which (i) has a noncancellable term
which exceeds one (1) year in length and requires in excess of an aggregate of
$1,500,000 per annum in payments by or on behalf of the Borrower or any Manager
or (ii) requires in excess of an aggregate of $1,500,000 per annum in payments
by or on behalf of the Borrower or any Manager regardless of the term of such
Operating Agreement; provided, that contracts or agreements entered into in
respect of events or performances at the Theater or the Premises will be
excluded from Material Operating Agreements so long as any such contracts or
agreements (x) are entered into by the Borrower or any Manager with a headline
performing artist of international repute and standing and the average ticket
price for any such performance or event shall be at least $100 per ticket or (y)
have a term or duration of less than sixty (60) days and are entered into by the
Borrower or any Manager with a Person who is not covered by clause (x) above.
"Maturity Date" means the sixth anniversary of the Closing Date.
"Maximum Term Loan A Rate" means, for the Initial Interest Period
for a Term Loan A, a rate per annum equal to the sum of: (a) 3.00% and (b)
LIBOR.
"Member" means any current or future member of the Borrower.
"Mezzanine Escrow Agreement" means that certain Escow Agreement
dated as of August 9, 2004 among Holdings, the Mezzanine Lenders party thereto
and JPMorgan Chase Bank, as escrow agent.
"Mezzanine Intercreditor Agreement" means that certain Subordination
Agreement by and among the Agent and the Mezzanine Lender, and acknowledged by
the Borrower and Holdings (such acknowledgment not to be unreasonably withheld
or delayed), substantially in the form of Exhibit R attached hereto, as the same
may be amended, restated, modified or supplemented in accordance with its terms.
"Mezzanine Investor Rights Agreement" means that certain Investor
Rights Agreement dated as of August 9, 2004 among Holdings, the Mezzanine
Lenders named therein, and the other signatories thereto and acknowledged and
agreed to by the Borrower (solely with respect to the provisions of Article VI
and Section 7.1 therein).
"Mezzanine Lender" means one or more Persons making the Mezzanine
Loan.
"Mezzanine Loan" means any subordinated loan made by the Mezzanine
Lender to Holdings in accordance with the Mezzanine Loan Agreement.
"Mezzanine Loan Agreement" means the Securities Purchase Agreement
among Holdings and the purchasers party thereto, in the form of Exhibit Q
attached hereto, as the same
23
may be amended, restated, modified or supplemented in accordance with the
provisions of the Mezzanine Intercreditor Agreement.
"Mezzanine Loan Documents" means the Mezzanine Intercreditor
Agreement, the Mezzanine Loan Agreement, the other Securities Purchase Documents
(as defined in the Mezzanine Loan Agreement) and any other agreements,
certificates, instruments and other documents evidencing, securing or pertaining
to the Mezzanine Loan.
"Minimum Bankroll Regulation" shall mean Regulation 6.150 of the
Regulations of the Nevada Gaming Commission.
"Minimum Term Loan A Applicable Margin" means (i) 1.00% per annum
during the period commencing on the Closing Date and ending on the first
Anniversary Date, (ii) 1.25% per annum during the period commencing on the day
after the first Anniversary Date and ending on the second Anniversary Date and
(iii) 1.50% per annum during the period commencing on the day after the second
Anniversary Date and ending on the third Anniversary Date.
"Minimum Term Loan A Rate" means, for the Initial Interest Period
for a Term Loan A, a rate per annum equal to the sum of (a) the Minimum Term
Loan A Applicable Margin and (b) LIBOR.
"Mortgage" means that certain Amended and Restated Deed of Trust,
Security Agreement, Financing Statement, and Fixture Filing, dated as of the
Closing Date, and executed by the Borrower in favor of the Agent.
"Mortgaged Property" has the meaning set forth in the Mortgage.
"Multiemployer Plan" means as to any Person, a "multiemployer plan"
as defined in Section 4001(a)(3) of ERISA and to which such Person is making, or
is obligated to make (or made or was obligated to make in the preceding
five-year period) contributions.
"Net Cash Proceeds" means the cash portion of Net Proceeds, when
received.
"Net Income" means with respect to the Borrower for any period, the
consolidated net income (or net loss) of the Borrower and its Subsidiaries for
such period but excluding any extraordinary gains or losses or any gains or
losses from the sale or disposition of assets other than in the ordinary course
of business, all computed and calculated in accordance with GAAP.
"Net Proceeds" means, with respect to an Asset Transfer or Casualty
Event: (a) the gross amount of all cash and the Fair Market Value of all other
Property, received directly or indirectly by the Borrower or a Subsidiary (or an
Affiliate in the case of Net Proceeds received from a Disposition of the Time
Share Premises), or for its account, in connection with the Asset Transfer or
Casualty Event, whether at the time of such Asset Transfer or Casualty Event or
thereafter, including, without limitation, upon receipt of all payments of
principal of or interest on any note or other debt instrument issued as part of
the consideration for such Asset Transfer or
24
Casualty Event; minus (b) the sum of: (i) all reasonable commissions, legal
fees, and other costs and expenses incurred by the Borrower or Subsidiary in
connection with such Asset Transfer or Casualty Event; (ii) payments on account
of Debt (other than the Obligations) secured by the Property disposed of in such
Asset Transfer or Casualty Event, the payment of which Debt was required in
order to consummate such Asset Transfer or necessary as a result of such
Casualty Event; (iii) the Tax Liability of the Borrower (or of such Subsidiary,
determined as if such Subsidiary was the Borrower) attributable to such Asset
Transfer or Casualty Event; and (iv) appropriate amounts to be set aside by the
Borrower or Subsidiary as a reserve, in accordance with GAAP, against
liabilities associated with the assets that are the subject of the Asset
Transfer or Casualty Event and which liabilities are retained by the Borrower or
Subsidiary after the Asset Transfer or Casualty Event (including, without
limitation, liabilities arising from indemnifications provided in connection
with such Asset Transfer or Casualty Event).
"Non-Excluded Taxes" has the meaning given to such term in Section
3.7 of this Agreement.
"Northwind" means Northwind Aladdin, LLC, a Nevada limited liability
company.
"Notified Reinvestment Amount" has the meaning given to such term in
Section 4.3(c) of this Agreement.
"Obligations" means any and all present and future loans, advances,
liabilities, obligations, covenants, duties, and Debts owing by the Borrower or
any other Loan Party to the Agent, or any Lender, arising under or pursuant to
this Agreement or any other Loan Document, whether arising from an extension of
credit, opening of a letter of credit, acceptance, loan, guaranty,
indemnification or otherwise, whether direct or indirect, absolute or
contingent, due or to become due, primary or secondary, as principal or
guarantor, and including, without limitation, all interest, charges, expenses,
fees, attorneys' fees, filing fees and any other sums chargeable to the Borrower
or any other Loan Party hereunder or under another Loan Document (including,
without limitation, interest accruing after the maturity of the Loans and
interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding). "Obligations" includes, without limitation, all
debts, liabilities, and obligations now or hereafter owing from the Borrower in
connection with Hedge Obligations. "Obligations" expressly exclude any and all
of the foregoing Obligations related to, or arising out of, or in connection
with, the Pre-Petition Credit Agreement or the GECC Facilities Agreement, except
to the extent such Obligations are expressly assumed by the Borrower under (i)
the Purchase and Sale Agreement or (ii) this Agreement or any other Loan
Document executed by the Borrower. Notwithstanding the above, in no event shall
the Holdings Guarantee be deemed to be a secured guaranty.
"Operating Accounts" means, collectively, Accounts in which the
receipts from the operation and management of the Premises are deposited and
from which disbursements on account of related expenditures are made, including
the operating Accounts listed in Section P of
25
the Disclosure Schedule.
"Operating Agreements" means, collectively, all agreements entered
into by the Borrower, any Subsidiary thereof or by any other Person on behalf of
the Borrower or any Subsidiary thereof or assumed by the Borrower under the
Purchase and Sale Agreement, relating to the ownership, operation or maintenance
of the Premises or any other Property.
"Operating Cash Reserve Amount" means as of the Closing Date, an
amount equal to the Initial Operating Cash Reserve Amount, which amount may be
increased thereafter only as set forth in the second sentence of Section 8.27 of
this Agreement. Funds constituting the Operating Cash Reserve Amount if expended
may be replenished solely from collections in cash of accounts receivable to the
extent income from any such account receivable was included in EBITDA in a
previous Fiscal Quarter.
"Organizational Documents" means, (a) for any corporation, the
Articles of Incorporation and by-laws of such and all amendments thereto, (b)
for any partnership, collectively, the general or limited partnership agreement,
as the case may be, with all amendments thereto, together with if appropriate, a
certificate of limited partnership and all amendments thereto, and (c) for any
limited liability company, the operating agreement and any other similar
agreements governing the organization of the limited liability company and the
management of its business and affairs, and all amendments thereto.
"Other Taxes" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.
"Parking Agreement" means that certain Common Parking Area Use
Agreement, dated as of February 26, 1998, by and between Aladdin and Boulevard
Invest (as successor-in-interest to Aladdin Bazaar, LLC), as amended and
modified by the terms of the Order of the Bankruptcy Court (the "Parking Garage
Order"), entered October 7, 2002 and as assumed by Aladdin pursuant to an Order
upon Motion to Assume Executory Contract or Unexpired Lease of Non-Residential
Real Property entered by the Bankruptcy Court on December 10, 2002 and others
and assigned to the Borrower under the Purchase and Sale Agreement.
"Participating Lender" has the meaning given to such term in Section
11.13(c) of this Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor.
"Pension Plan" means any Plan which is subject to the provisions of
Title IV of ERISA.
"Permits" means all Gaming Licenses and all other licenses, permits,
franchises, authorizations, certificates, approvals and consents, including,
without limitation, all certificates
26
of occupancy, all environmental, liquor, health and safety licenses of all
Governmental Authorities which are material to the conduct of the Borrower's and
each of its Subsidiaries' business and the ownership, use, occupation and
operation of the Premises.
"Permitted Investments" means (a) direct obligations issued by, or
guaranteed by, the United States government or issued by any agency thereof, in
each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, Eurodollar time deposits, or overnight
bank deposits, bankers' acceptance and other interest bearing deposits or
accounts having maturities of one year or less from the date of acquisition
issued by any Lender or by any bank or trust company organized under the laws of
the United States of America or any state thereof having combined capital and
surplus of not less than $100,000,000; (c) commercial paper of an issuer rated
at least A-2 by Standard & Poor's Ratings Services ("S&P") or P-2 by Xxxxx'x
Investors Service, Inc. ("Moody's"), or carrying an equivalent rating by a
nationally recognized rating agency, and maturing within 270 days from the date
of acquisition; (d) repurchase obligations of any Lender or of any commercial
bank satisfying the requirements of clause (b) of this definition, having a term
of not more than 30 days with respect to securities issued or fully guaranteed
or insured by the United States government; (e) securities with maturities of
one year or less from the date of acquisition issued or fully guaranteed by any
state, commonwealth or territory of the United States, by any political
subdivision or taxing authority of any such state, commonwealth or territory or
by any foreign government, the securities of which state, commonwealth,
territory, political subdivision, taxing authority or foreign government (as the
case may be) are rated at least A by S&P or A by Moody's, or carry an equivalent
rating by a nationally recognized rating agency; (f) securities with maturities
of six months or less from the date of acquisition backed by standby letters of
credit issued by any Lender or any commercial bank satisfying the requirements
of clause (b) of this definition; (g) shares of money market mutual or similar
funds which invest exclusively in assets satisfying the requirements of clauses
(a) through (f) of this definition; or (h) all or a portion of any Term Loan.
"Permitted Liens" means: (a) Liens for taxes, assessments,
governmental charges, levies or claims (i) not yet payable or (ii) being
contested in good faith and by proper proceedings diligently pursued, provided
that an adequate reserve shall have been made therefor by the Borrower; (b)
Liens in favor of the Agent to secure the Obligations; (c) purchase money Liens
upon Equipment granted in connection with the acquisition of such Equipment by
the Borrower or any other Loan Party (other than Holdings) after the date
hereof, including, but not limited to, pursuant to Capital Leases and including
any renewals or refinancings thereof, provided that (i) the cost of each such
acquisition constitutes a Capital Expenditure permitted by Section 8.11 (Capital
Expenditures), (ii) the Debt incurred to finance each such acquisition is
permitted by Section 8.4 (Debt), and (iii) each such Lien attaches only to the
Equipment acquired with the Debt secured thereby; (d) deposits or pledges under
workmen's compensation, unemployment insurance, pensions, social security and
other similar laws (other than ERISA); (e) carriers', warehousemen's,
mechanics', materialmen's, repairmen's, landlord's and laborers' or other like
Liens arising in the ordinary course of business securing sums which are not
overdue or which are being contested in good faith through appropriate
proceedings and for which the Borrower has posted a bond as required by the
Agent or applicable law; (f) deposits or pledges to secure performance in
connection with bids, tenders, contracts (other than contracts for the payment
of
27
money) or leases made in the ordinary course of business by the Borrower or any
Subsidiary; (g) deposits to secure public or statutory obligations of the
Borrower or any Subsidiary; (h) deposits to secure surety, appeal or customs
bonds in proceedings to which the Borrower or any Subsidiary is a party; (i)
Liens arising out of judgments or awards in respect of which the Borrower or any
Subsidiary shall in good faith be prosecuting an appeal or proceedings for
review and in respect of which the Borrower or any Subsidiary shall have secured
a subsisting stay of execution pending such appeal or proceedings for review,
provided that adequate reserves as shall be required by GAAP shall have been
made therefor on the applicable financial statements of the Borrower or as
required by applicable law; (j) a lease of personal Property entered into in the
ordinary course of business, so long as the Lien attaches only to such personal
Property; (k) Liens listed on Schedule 1.1 hereto, including any renewals or
refinancings thereof, so long as the Liens do not cover any additional Property,
but only to the extent such Liens continue to secure Debt permitted by Section
8.4 (Debt); (l) Liens securing Debt of a newly acquired Person (or assets
thereof), which Person (or the assets thereof) was acquired after the Closing
Date as an Investment permitted under the terms of this Agreement and which
Liens were in existence at the time of acquisition by the Borrower of such
Person (or the assets thereof), and not incurred in contemplation of such
acquisition; (m) Liens existing on the Property at the time the Borrower
acquires such Property from Aladdin under the Purchase and Sale Agreement and
listed on Schedule 1.1 hereto; and (n) easements, zoning restrictions, rights-
of-way and similar encumbrances on real property (1) imposed by law or arising
in the ordinary course of business that do not secure any monetary obligations
and do not materially detract from the value of the affected property or
interfere with the ordinary conduct of business of the Borrower or any
Subsidiary or (2) in the case of the Mortgaged Property, encumbrances disclosed
in the title insurance policy based on the Title Commitment and issued to the
Agent for the benefit of the Term Loan A Lenders and Term Loan B Lenders, and
approved by the Required Term Loan A Lenders.
"Person" means any individual, sole proprietorship, partnership,
joint venture, limited liability company, trust, unincorporated organization,
association, corporation, Governmental Authority, or any other entity.
"PHI" means Planet Hollywood International , Inc., a Delaware
corporation.
"PHMemo" means Planet Hollywood Memorabilia, Inc., a Florida
corporation.
"PHIV" means Planet Hollywood (Region IV), Inc., a Minnesota
corporation.
"Plan" means any pension plan, as defined in Section 3(2) of ERISA
(other than a Multiemployer Plan), which is maintained or contributed to by (or
to which there is an obligation to contribute of) the Borrower or an ERISA
Affiliate and each such plan for the five-year period immediately following the
latest date on which the Borrower or an ERISA Affiliate maintained, contributed
to or had an obligation to contribute to such plan.
"Plan of Reorganization" means the Revised First Amended Plan of
Reorganization of Aladdin confirmed by the Bankruptcy Court on August 28, 2003,
as the same
28
may be amended, modified or otherwise supplemented from time to time in
accordance therewith.
"Planet Hollywood Security Agreement" means the Amended and Restated
Security Agreement by and among PHI, PHIV, and PHMemo in favor of the Agent for
the benefit of the Lenders and substantially in the form attached hereto as
Exhibit T.
"Plans and Specifications" means all plans, specifications, design
documents, schematic drawings and related items related to Renovation Capital
Expenditures and other improvements to the Premises.
"Premises" means the premises known as Aladdin Hotel and Casino and
related complexes located at Las Vegas Boulevard and Harmon Avenue in Xxxxx
County, Nevada, as more particularly described in Exhibit C hereto, which
Premises includes, without limitation, the Hotel Premises, the Retail Shops, the
Casino, the Time Share Premises, the Theater and the Energy Premises; provided,
however, that upon the receipt by the Agent of $14,000,000 in cash as set forth
in Section 5.1(x), the Premises shall not include the Time Share Premises.
"Pre-Petition Credit Agreement" has the meaning given to such term
in the recitals of this Agreement.
"Pre-Petition Loan Documents" means the Pre-Petition Credit
Agreement and all agreements, documents and instruments executed and/or
delivered by Aladdin and/or its Affiliates in connection therewith.
"Prime-Based Loan" means a Loan bearing interest at the Prime-Based
Rate.
"Prime-Based Rate" means the Prime Lending Rate, plus 2.5%.
"Prime Lending Rate" means the rate which The Bank of New York
announces from time to time as its prime lending rate, as in effect from time to
time. The Prime Lending Rate is a reference rate and does not necessarily
represent the lowest or best rate actually charged by The Bank of New York or
any Lender to any customer. The Lenders may make commercial loans or other loans
at rates of interest at, above or below the Prime Lending Rate.
"Proceeds" means all "proceeds" as such term is defined in the UCC
and all proceeds and products of any Collateral, and all proceeds of such
proceeds and products, including, without limitation, all cash and credit
balances, all payments under any indemnity, warranty, or guaranty payable with
respect to any Collateral, all awards for taking by eminent domain, all proceeds
of fire or other insurance, and all money and other Property obtained as a
result of any claims against third parties or any legal action or proceeding
with respect to Collateral and all dividends or other income from any Equity
Interests pledged to the Agent, collections thereon or distributions or payments
with respect thereto.
"Property" means any right or interest in or to property of any kind
whatsoever of
29
the Borrower or any other Loan Party (other than Holdings), whether real,
personal or mixed and whether tangible or intangible, including, without
limitation, the Premises and Equity Interests held by the Borrower or any such
other Loan Party.
"Proprietary Rights" means, with respect to the Borrower or any
other Loan Party (other than Holdings), all of such Person's now owned and
hereafter arising or acquired: licenses, franchises, permits, patents, patent
rights, copyrights, works which are the subject matter of registered copyrights,
registered trademarks, trade names, patent and trademark applications, and
licenses and rights thereunder, including, without limitation, those patents,
trademarks and copyrights set forth on Section C of the Disclosure Schedule, and
all other rights under any of the foregoing, all extensions, renewals, reissues,
divisions, continuations, and continuations-in-part of any of the foregoing, and
all rights to xxx for past, present, and future infringement of any of the
foregoing; inventions, trade secrets, formulae, processes, compounds, drawings,
designs, blueprints, plans, specifications, warranties, surveys, reports,
manuals, and operating standards; goodwill; customer and other lists in whatever
form maintained; and trade secret rights, copyright rights, rights in works of
authorship, and contract rights relating to computer software programs, in
whatever form created or maintained; internet web sites, domain names and
applications and registrations pertaining thereto, and all intellectual property
in connection with or contained in all versions of such internet web sites.
"Purchase and Sale Agreement" means that certain Purchase and Sale
Agreement dated as of April 23, 2003, as amended to date, between the Borrower,
as purchaser and Aladdin, as seller.
"REA" means that certain Construction, Operation and Reciprocal
Easement Agreement dated as of February 26, 1998 among Aladdin, Boulevard Invest
(successor-in-interest to Aladdin Bazaar, LLC) and Aladdin Music Holdings, LLC,
as amended by that certain (i) Amendment and Ratification of Construction,
Operation and Reciprocal Easement Agreement dated as of November 20, 2000
between Aladdin and Boulevard Invest (successor-in-interest to Aladdin Bazaar,
LLC) which was recorded in the Official Records of Xxxxx County in Book
20001120, Document No.: 00858 and (ii) Second Amendment of Construction,
Operation and Reciprocal Easement Agreement between Aladdin and Boulevard Invest
(successor-in-interest to Aladdin Bazaar, LLC) which was recorded in the
Official Records of Xxxxx County in Book 20030331, Document No.: 04875 on March
31, 2003, as further amended, modified or supplemented from time to time.
"Register" has the meaning given to such term in Section 4.11 of
this Agreement.
"Regulation U" means Regulation U of the Board as in effect from
time to time.
"Regulatory Replacement" has the meaning given to such term in
Section 4.8 of this Agreement.
"Reinvestment Amount" has the meaning given to such term in Section
4.3(c) of this Agreement.
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"Reinvestment Assets" means any capital assets to be employed in the
business of the Borrower or any of its Subsidiaries, which, in the case of a
Casualty Event, shall include, at the option of the Borrower, the replacement,
refurbishing, or reconstruction of the assets subject to such Casualty Event.
"Reinvestment Election" has the meaning given to such term in
Section 4.3(c) of this Agreement.
"Reinvestment Notice" means a written notice signed by an Approved
Officer of the Borrower stating that (i) no Event or Event of Default has
occurred and is continuing and (ii) the Borrower or any of its Subsidiaries in
good faith, intends and expects to use all or a specified portion of the Net
Cash Proceeds of an Asset Transfer or Casualty Event to purchase, construct or
otherwise acquire Reinvestment Assets within eighteen (18) months of the end of
month to which the notice relates.
"Reinvestment Prepayment Amount" means with respect to any
Reinvestment Election, the amount, if any, on the Reinvestment Prepayment Date
relating thereto by which (i) the Notified Reinvestment Amount in respect of
such Reinvestment Election exceeds (ii) the aggregate amount thereof expended to
construct or acquire Reinvestment Assets.
"Renovation Capital Expenditure Account" means an account of the
Borrower held at The Bank of New York and subject to a deposit account control
agreement (in form and substance reasonably satisfactory to the Agent)
designated for Renovation Capital Expenditures that the Agent may draw (or
direct payment) upon as provided in Section 4.3(b) in the event that the
Borrower fails to comply with Section 4.3(b) (it being understood that the
Borrower may withdraw funds from such account solely in order to satisfy its
obligations to spend $90,000,000 on and for Renovation Capital Expenditures as
provided herein or to satisfy its other obligations under Section 4.3(b)).
"Reinvestment Prepayment Date" means, with respect to any
Reinvestment Election, the earliest of (i) the date, if any, upon which the
Agent, on behalf of the Required Term Loan A Lenders, shall have delivered a
written termination notice to the Borrower with respect to the Reinvestment
Election, provided that such notice may only be given while an Event of Default
exists, and shall only be effective for so long as such Event of Default
continues, (ii) the date occurring eighteen (18) months after such Reinvestment
Election and (iii) the date on which the Borrower (for itself or on behalf of
its Subsidiary) shall have determined not to, or shall have otherwise ceased to,
proceed with the purchase, construction or other acquisition of Reinvestment
Assets with the related Reinvestment Amount.
"Renovation Capital Expenditures" means those Capital Expenditures
made by the Borrower or any of its Subsidiaries for the purposes and in the
amounts set forth on Exhibit L (such Exhibit may be updated by the Borrower so
long as the additional Renovation Capital Expenditures are of the same scope as
those originally set forth in such Exhibit) or other Capital Expenditures
approved by the Agent in its reasonable discretion to constitute Renovation
Capital Expenditures, acting upon the reasonable direction of the Required Term
Loan A Lenders, in the
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aggregate minimum amount of $90,000,000. No more than $9,000,000 of such
$90,000,000 may constitute expenditures not required to be capitalized under
GAAP. The Renovation Capital Expenditures shall for all purposes exclude
Maintenance Capital Expenditures. No more than $150,000 of closing costs and
fees may be reimbursed to the Borrower from the $90,000,000 constituting
Renovation Capital Expenditures.
"Rent Roll" has the meaning set forth in paragraph S of the
Representation and Warranty Certificate.
"Rents" has the meaning set forth in the Mortgage.
"Reorganization" means, with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.
"Reportable Event" means a Reportable Event as defined in Section
4043(b) of ERISA.
"Representation and Warranty Certificate" means a certificate of the
Borrower, signed by an Approved Officer, in form and substance substantially
similar to Exhibit N.
"Required Lenders" means, at any time, the holders of more than 50%
of (a) until the Closing Date, the Commitments and (b) thereafter, the aggregate
unpaid principal amount of the Term Loans then outstanding (without taking into
account any accrued but unpaid interest on the Term Loan B that is added to the
principal of the Term Loan B pursuant to Section 3.2 of this Agreement).
"Required Term Loan A Lenders" means, at any time, the holders of
more than 50% of (a) until the Closing Date, the Term Loan A Commitment and (b)
thereafter, the aggregate unpaid principal amount of the Term Loan A then
outstanding.
"Required Term Loan B Lenders" means, at any time, the holders of
more than 50% of (a) until the Closing Date, the Term Loan B Commitment and (b)
thereafter, the aggregate unpaid principal amount of the Term Loan B then
outstanding.
"Reserve Amount" means any cash of the Borrower and its Subsidiaries
in an amount not to exceed $30,000,000 and which is calculated as follows for
any Fiscal Quarter:
(i) EBITDA for such Fiscal Quarter,
plus
(ii) the Carry-Over Reserve Amount,
less
32
(iii) the Cash Interest Expense of the Borrower and its Subsidiaries
paid during such Fiscal Quarter,
less
(iv) the aggregate amount of any Maintenance Capital Expenditures
paid in cash during such Fiscal Quarter (subject to the
limitations set forth in Section 8.12 and expressly excluding
the additional $3,000,000 of Capital Expenditures permitted to
be made in the second paragraph of Section 8.12),
less
(v) all payments of principal on the Term Loan A made pursuant to
Section 4.1(b), 4.2 or Section 4.3(a) (solely to the extent
that any amounts received by the Borrower pursuant to Section
4.3(a) are included in EBITDA for such Fiscal Quarter) by the
Borrower during such Fiscal Quarter,
less
(vi) the amount of any Taxes paid in cash by the Borrower and its
Subsidiaries during such Fiscal Quarter or if the Borrower is
treated as a pass-through entity or is not treated as a
separate entity for United States federal income tax purposes,
the amount of Distributions made in cash by the Borrower in
accordance with Section 8.2(c) (Distributions) during such
Fiscal Quarter, and
less
(vii) the amount of any additions during such Fiscal Quarter to the
Operating Cash Reserve Amount permitted under Section 8.27 of
this Agreement.
The Reserve Amount shall not include the Operating Cash Reserve
Amount.
"Restaurant License Agreement" has the meaning given to such term in
Section 5.1(t)(iii) of this Agreement.
"Restricted Investment" means any investment by the Borrower or a
Subsidiary in any other Person for cash or other Property, including, without
limitation, in the form of an acquisition of capital stock, indebtedness or
other obligation, or by loan, advance or capital contribution, except the
following: (a) Property acquired in the ordinary course of the business of the
Borrower or a Subsidiary to be used in the ordinary course of such business,
subject to a valid, first priority, Security Interest (subject to Permitted
Liens) in favor of the Agent for the benefit of the Secured Parties or a
purchase money Lien permitted under clause (c) of the definition of Permitted
Liens; (b) current assets arising from the sale or lease of goods or
33
rendition of services in the ordinary course of business of the Borrower or a
Subsidiary; (c) investments existing on the Closing Date including in the Equity
Interests of Subsidiaries and Affiliates; (d) Permitted Investments, so long as
such are subject to a valid, first priority, Security Interest (subject to
Permitted Liens) in favor of the Agent for the benefit of the Secured Parties;
(e) investments consisting of Hedging Agreements; (f) investments in non-cash
consideration received in connection with a permitted sale of assets (subject to
the granting of a Lien as required by the Security Documents); (g) the
Borrower's investment, if any, in the Time Share Entity; (h) investments in any
Subsidiary existing on the Closing Date or organized or acquired after the
Closing Date in compliance with Section 8.9 of this Agreement; (i) loans or
advances to officers, directors and employees of the Borrower or any of its
Subsidiaries made in the ordinary course of business provided that the aggregate
amount of such loans or advances does not exceed $400,000 at any one time
outstanding; (j) investments arising from transactions by the Borrower or any of
its Subsidiaries with customers or suppliers in the ordinary course of business,
including, without limitation, endorsements of negotiable instruments and debt
obligations and other investments received in connection with the bankruptcy or
reorganization of customers and suppliers or in settlement of delinquent
obligations of, or other disputes with, customers or suppliers, arising in the
ordinary course of business (subject to the granting of a Lien as required by
the Security Documents); and (k) other investments not to exceed a net amount
equal to $200,000 in the aggregate outstanding at any time.
"Retail Shops" means, collectively, the portion of the Hotel
Premises or Casino Premises where retail shops are located.
"Second Measurement Period" has the meaning given to such term in
Section 8.13(a) of this Agreement.
"Second Renovation Capital Expenditure Measurement Date" means the
last day of the thirtieth (30th) month following the Closing Date.
"Secured Parties" means the Lenders, the Agent and all other
obligees with respect to the Obligations.
"Security Agreement" means the Omnibus Pledge and Security Agreement
to be executed and delivered by the Borrower and each other Loan Party (other
than Holdings), substantially in the form of Exhibit D, as the same may be
amended, supplemented or otherwise modified from time to time.
"Security Documents" means the collective reference to the Security
Agreement, the Planet Hollywood Security Agreement, the Assignment of Contract,
the Mortgage, the deposit account control agreements and all other security
documents hereafter delivered to the Agent granting a Lien on any Property of
any Person to secure the Obligations.
"Security Interest" means collectively the Liens in the Collateral
granted to the Agent or the Agent for the benefit of the Secured Parties
pursuant to this Agreement, the other Loan Documents, or any other agreement or
instrument, or by applicable law, in each case in
34
respect of the Obligations (other than those of Holdings).
"Settlement Agreement" means the Settlement Agreement and Releases,
dated as of November 6, 2002, by and among Aladdin, Northwind, Xxxx Xxxxxxx Life
Insurance Company, Xxxx Xxxxxxx Variable Life Insurance Company, Xxxx Xxxxxxx
Reinsurance Company Limited, State Street Bank and Trust Company and Boulevard
Invest (successor-in- interest to Aladdin Bazaar, LLC), as amended by that
certain First Amendment to Settlement Agreement and Releases, dated as of
December 23, 2002.
"Sheraton" means Sheraton Operating Corporation, a Delaware
corporation.
"Shortfall Interest Amount" has the meaning given to such term in
Section 3.1(a)(ii) of this Agreement.
"Significant Repair or Improvement" means any improvement,
alteration or addition constructed or made by the Borrower at the Premises,
other than initial tenant improvement and other initial work done inside the
leased premises pursuant to any Lease entered into by the Borrower in accordance
with Section 7.17 (Leases) hereof, which (a) costs or is reasonably estimated to
cost in excess of $5,000,000, or (b) when aggregated with all other
improvements, alterations and additions constructed or made by the Borrower at
the Premises during such Fiscal Year, costs or is reasonably estimated to cost
in excess of $10,000,000. "Significant Repair or Improvement" shall exclude
improvements, alterations, additions, and repairs made with Renovation Capital
Expenditures.
"Sixth Measurement Period" has the meaning set forth in Section
8.13(a) of this Agreement.
"Solvent" means, when used with respect to any Person, that, as of
any date of determination, (a) the amount of the "present fair saleable value"
of the assets of such Person will, as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise", as of such date, as such
quoted terms are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) "debt" and "claim" shall have the meanings
set forth in the Bankruptcy Code.
"Starwood" means Starwood Hotels and Resorts Worldwide, Inc., a
Maryland corporation.
"Subordination Agreements" means, collectively, any Manager
Subordination Agreement, the License Subordination Agreement, and any Leasing
Manager Subordination
35
Agreement.
"Subsequent Default Rate" has the meaning given to such term in
Section 3.3 of this Agreement.
"Subsidiary" means, as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such corporation, partnership, limited liability company or other entity are at
the time owned, or the management of which is otherwise controlled, directly or
indirectly through one or more intermediaries, or both, by such Person;
provided, however, that "Subsidiary" shall not include the Time Share Entity.
Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"Survey" means a current ALTA survey of the Premises prepared by a
surveyor acceptable to the Borrower and Agent who is a licensed surveyor in the
State of Nevada, which survey shall be in form and substance, including
certification, acceptable to the Borrower and Agent.
"Suspension Period" has the meaning given to such term in Section
4.8 of this Agreement.
"Taking" (and its correlative meanings) means any temporary or
permanent taking by any Governmental Authority of the Premises or any portion
thereof through eminent domain, condemnation or other proceedings or by any
settlement or compromise of such proceedings, or any voluntary conveyance of
such property or any portion thereof during the pendency of any such
proceedings.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority and any and all liabilities (including interest, fines, penalties or
additions to tax) with respect to the foregoing.
"Tax Liability" means the product of (a) the hypothetical taxable
income of the Borrower for Federal income tax purposes computed as if the
Borrower were a corporation subject to federal income tax for such purposes, and
(b) the sum of the maximum marginal United States income tax rate applicable to
corporations under Section 11 of the Code or any successor provision and fifty
(50) percent of the maximum marginal New York State income tax rate applicable
to corporations (after taking into account any Federal income tax benefit in
respect of such New York State tax rate).
"Tax Refund" has the meaning set forth in Section 3.7 of this
Agreement.
"Term Loan A" has the meaning set forth in Section 2.2 of this
Agreement.
36
"Term Loan A Commitment" means as to any Term Loan A Lender, the
obligation of such Lender to make a Term Loan A to the Borrower hereunder in a
principal amount not to exceed the amount set forth opposite such Lender's name
on Exhibit A hereto.
"Term Loan A Eurodollar Rate" means, for the Interest Period of a
Term Loan A, a rate per annum equal to the sum of: (i) (x) 3.25% per annum
during the period commencing on the day after the third Anniversary Date and
ending on the fourth Anniversary Date and (y) LIBOR; and (ii) (x) 3.50% per
annum during the period commencing on the day after the fourth Anniversary Date
and ending on the sixth Anniversary Date and (y) LIBOR.
"Term Loan A Interest Amount" means, during the Initial Interest
Period, an amount equal to (i) EBITDA for the Fiscal Quarter last ended less
(ii) the aggregate amount of any Maintenance Capital Expenditures paid in cash
by the Borrower during the Fiscal Quarter last ended (subject to the limitations
set forth in Section 8.12) and (iii) dividing the difference between (i) and
(ii) by 1.20 (until such time as the Reserve Amount equals $30,000,000 and
thereafter this clause (iii) shall no longer apply).
"Term Loan A Lender" means each Lender designated as a Term Loan A
Lender on the signature pages hereof, or who is the holder of a Term Loan A.
"Term Loan A Percentage" means as to any Term Loan A Lender at any
time, the percentage which the aggregate principal amount of such Lender's Term
Loan A then outstanding constitutes of the aggregate principal amount of the
Term Loan A then outstanding.
"Term Loan B" has the meaning set forth in Section 2.3 of this
Agreement.
"Term Loan B Commitment" means as to any Term Loan B Lender, the
obligation of such Lender to make a Term Loan B to the Borrower hereunder in a
principal amount not to exceed the amount set forth opposite such Lender's name
on Exhibit A hereto.
"Term Loan B Eurodollar Rate" means, for the Interest Period for a
Eurodollar Loan, a rate per annum equal to the sum of: (a) 4.00% and (b) LIBOR.
"Term Loan B Lender" means each Lender designated as a Term Loan B
Lender on the signature pages hereof, or who is the holder of a Term Loan B.
"Term Loan B Percentage" means as to any Term Loan B Lender at any
time, the percentage which the aggregate principal amount of such Lender's Term
Loans B then outstanding constitutes of the aggregate principal amount of the
Term Loan B then outstanding.
"Term Loan Commitment" means, collectively, the Term Loan A
Commitment and the Term Loan B Commitment.
"Term Loan Notes" has the meaning set forth in Section 2.4 of this
Agreement.
37
"Term Loans" means, collectively, the Term Loan A and the Term Loan
B.
"Termination Date" means the earlier of: (x) the Maturity Date or
(y) the date as of which all Term Loans and all Obligations in respect thereof
have been paid in full.
"Terrorist Event" means the occurrence of an event which is an "act
of terrorism" (as defined in the Terrorism Risk Insurance Act of 2002, Public
Law No. 107-297) (other than an act that occurs in the premises of a United
States mission) which results in a Visitor Decrease of greater than five percent
during the calendar month in which such event occurs or the immediately
succeeding calendar month.
"Terrorist Event Period" means the period beginning on the first day
of the calendar month in which a Terrorist Event results in a Visitor Decrease
of greater than five percent and ending on the first day of the next calendar
month in which the Visitor Decrease is not greater than five percent.
"Theater" means the Theater for Performing Arts located on the
Premises, described on Exhibit B-3.
"Theater Renovation Account" means the Theater Escrow Account (as
defined in the Mezzanine Loan Agreement) (it being understood that funds may be
withdrawn from such account and be used in each case solely in order to satisfy
the Borrower's obligations to spend $90,000,000 on and for Renovation Capital
Expenditures as provided herein or to satisfy its other obligations under
Section 4.3(b)).
"Third Renovation Capital Expenditure Measurement Date" the third
Anniversary Date.
"Time Share Entity" means any Person to which the Time Share
Premises has been conveyed to or otherwise Disposed of pursuant to a Time Share
Plan.
"Time Share Plan" means a plan for the development or operation of
the Time Share Premises with a Developer, which in each case is satisfactory to
the Agent (acting at the reasonable direction of the Required Term Loan A
Lenders (other than the FF&E Lender)) and shall include, without limitation, any
agreements approved by the Agent (acting at the reasonable direction of the
Required Term Loan A Lenders (other than the FF&E Lender)) in accordance with
Section 7.29 and Section 8.23.
"Time Share Premises" means the real property of the Borrower
described on Exhibit B-2 hereto.
"Title Company" means Chicago Title Insurance Company.
"Title Insurance Commitment" means the Pro Forma Title Policy,
issued by the Title Company under Policy No. PRO02119570 L, along with copies of
all instruments creating
38
or evidencing exceptions or encumbrances to title.
"Title Insurance Policy" means an ALTA 1970 form of mortgagee title
insurance policy from the Title Company and insuring the priority and
sufficiency of the Mortgage as a first priority Lien upon the Premises, (a) in
an aggregate amount equal to at least $510,000,000, (b) showing that the
Borrower is the sole owner of fee title to the Premises subject to no liens or
encumbrances and no exceptions or qualifications other than the Permitted Liens
and as otherwise may be reasonably acceptable to the Agent, (c) insuring the
priority of the Mortgage unconditionally against all possible contractors',
suppliers', and mechanics' lien claims that heretofore or hereafter arise, as
well as matters related to the Survey, (d) omitting any creditors' rights
exclusion in the Title Insurance Policy, (e) containing any endorsements or
assurances that the Agent and the Term Loan A Lenders may reasonably request for
protection of its interests that are available under applicable law and (f)
otherwise being reasonably acceptable to the Agent and the Lenders in form and
content.
"Transferee" has the meaning given to such term in Section 3.7(b) of
this Agreement.
"UCC" means the Uniform Commercial Code (or any successor statute),
as in effect from time to time, of the State of New York or of any other state
the laws of which are required to be applied with respect to the creation,
validity, perfection or priority of the Agent's Liens for the benefit of the
Secured Parties.
"Unsuitable Lender" has the meaning given to such term in Section
4.9 of this Agreement.
"Visitor Decrease" means a decrease in the number of monthly visitor
volume to Las Vegas, Nevada (as published by the Las Vegas Convention and
Visitors Authority) compared to the number of monthly visitors to Las Vegas,
Nevada in the same calendar month of the immediately preceding year.
"Warrants" has the meaning given to such term in Section 5.1(v) of
this Agreement.
1.2 Other Definitional Provisions. (a) Unless otherwise specified therein,
all terms defined in this Agreement shall have the defined meanings when used in
the other Loan Documents or any certificate or other document made or delivered
pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto,
accounting terms relating to the Borrower and its Subsidiaries not defined in
Section 1.1 and accounting terms partly defined in Section 1.1, to the extent
not defined, shall have the respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import
39
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Section, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms. The words
"include" and "including" whenever used in this Agreement or any other Loan
Document shall be deemed to be followed by the words "without limitation."
(e) Any reference to any agreement in this Loan Agreement shall be
deemed to mean such agreement as it may from time to time be amended, restated,
extended, renewed, increased, consolidated, spread, severed, supplemented or
otherwise modified in accordance with the terms thereof.
1.3 Other Terms. All other undefined terms contained in this Agreement
shall, unless the context indicates otherwise, have the meanings provided for by
the UCC to the extent the same are used or defined therein. Wherever appropriate
in the context, terms used herein in the singular also include the plural, and
vice versa and each masculine, feminine, or neuter pronoun shall also include
the other genders.
1.4 Accounting Terms. (a) Unless otherwise expressly provided herein, each
accounting term used herein shall have the meaning given it under GAAP.
(b) If any "Accounting Changes" (as defined below) occur and such
changes result in a change in the calculation of the financial covenants,
standards or terms used in this Agreement or any other Loan Document, then the
Borrower, the Agent and the Lenders agree to enter into good faith negotiations
in order to amend such provisions of the Agreement so as to equitably reflect
such Accounting Changes with the desired result that the criteria for evaluating
the Borrower and its Subsidiaries' financial condition shall be the same after
such Accounting Changes as if such Accounting Changes had not been made;
provided, however, that the agreement of the Required Term Loan A Lenders to any
required amendments of such provisions shall be sufficient to bind all the
Lenders. "Accounting Changes" shall mean changes in accounting principles
required by the promulgation of any rule, regulation, pronouncement or opinion
by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants (or successor thereto) or any agency with similar
functions. If the Agent, the Borrower and the Required Term Loan A Lenders agree
upon the required amendments, then after appropriate amendments have been
executed and the underlying Accounting Change with respect thereto has been
implemented, any reference to GAAP contained in this Agreement or in any other
Loan Document shall, only to the extent of such Accounting Change, refer to
GAAP, consistently applied after giving effect to the implementation of such
Accounting Change. Unless and until any such required amendments shall become
effective, all calculations of financial covenants and other standards and terms
shall continue to be calculated without regard to the underlying Accounting
Change; and if the Agent, the Borrower and the Required Lenders cannot agree
upon the required amendments within thirty (30) days following the entering into
of the good faith negotiations, then all financial statements delivered and all
calculations of
40
financial covenants and other standards and terms in accordance with this
Agreement and the other Loan Documents shall be prepared, delivered and made
without regard to the underlying Accounting Change.
ARTICLE 2
LOANS
2.1 Total Facility. Subject to the terms and conditions of this Agreement,
the Lenders shall be deemed to have made available to the Borrower on the
Closing Date a total credit facility of $510,000,000 comprised of Term Loan A in
aggregate principal amount equal to $500,000,000 (of which $14,000,000 shall be
paid to the Term Loan A Lenders (other than the FF&E Lender) on the Closing Date
pursuant to Section 5.1(x), so that after receipt by the Agent of such payment,
the aggregate principal amount of the Term Loan A shall be equal to
$486,000,000) and Term Loan B in an aggregate principal amount equal to
$10,000,000, as provided in this Article 2. This Agreement is an amendment and
restatement of all terms of the Pre-Petition Credit Agreement and the GECC
Facilities Agreement, such terms to be superseded in all events by this
Agreement, and the Borrower shall have no liabilities or obligations whatsoever
under the Pre-Petition Credit Agreement or the GECC Facilities Agreement, except
to the extent such liabilities and obligations are expressly assumed by the
Borrower under the (i) Purchase and Sale Agreement, (ii) the Plan of
Reorganization approved by the Confirmation Order, or (iii) under this Agreement
or any other Loan Document executed by the Borrower.
2.2 Term Loan A. Subject to the terms and conditions hereof, each Term
Loan A Lender shall be deemed to have made a term loan (a "Term Loan A") to the
Borrower on the Closing Date in an amount equal to the amount of the Term Loan A
Commitment of such Lender; provided, that on the Closing Date the aggregate
principal amount of the Term Loan A shall equal $500,000,000 (of which
$14,000,000 shall be paid to the Term Loan A Lenders (other than the FF&E
Lender) on the Closing Date pursuant to Section 5.1(x), so that after receipt by
the Agent of such payment, the aggregate principal amount of the Term Loan A
shall be equal to $486,000,000).
2.3 Term Loan B. Subject to the terms and conditions hereof, each Term
Loan B Lender shall be deemed to have made a term loan (a "Term Loan B") to the
Borrower on the Closing Date in an amount equal to the amount of the Term Loan B
Commitment of such Lender; provided, that on the Closing Date the aggregate
principal amount of the Term Loan B shall equal $10,000,000.
2.4 Notes Evidencing Term Loans. In addition to this Agreement, the
Borrower's obligations to repay the Term Loans shall be evidenced by (i) a
single promissory note of the Borrower payable to the order of the Term Loan A
Lenders and held by the Agent on behalf of each Term Loan A Lender in the form
attached as Exhibit E-1 and (ii) a single promissory note of the Borrower
payable to the order of the Term Loan B Lenders and held by the Agent on behalf
of each Term Loan B Lender in the form attached as Exhibit E-2, each as amended,
modified, replaced or reissued from time to time (collectively, the "Term Loan
Notes"). In the
41
event that a Lender shall request a Term Loan Note payable to its order or shall
assign all or a part of its rights and obligations under, and in accordance with
the terms of this Agreement and the new Lender shall request a Term Loan Note
payable to its order, the Borrower shall execute and deliver one or more Term
Loan Notes or replacement Term Loan Notes, as the case may be, to carry out any
such request.
2.5 Borrowing of Term Loans. The Term Loans shall be deemed to have been
made on the Closing Date.
2.6 Renewals of Term Loans. All Eurodollar Loans shall be automatically
renewed at the end of each Interest Period unless such a renewal is prohibited
by Section 3.12 or if an Event or Event of Default has occurred or is
continuing.
2.7 Term Loan Account. The Agent will establish a loan account for the
Borrower with each Lender. Unless the Agent otherwise elects, the principal
amount of each Term Loan A and each Term Loan B, the amount of each required
principal repayment, all accrued interest, all fees, all payments due to the
Agent or a Lender from the Borrower under Sections 3.8 (Requirements of Law),
3.9 (Capital Adequacy Costs), 3.11 (Indemnity) and 4.3(b) (Renovation Capital
Expenditures) in the event that the Letter of Credit has not been issued and
drawn by the Agent, and all costs and expenses described in Section 11.10 (Fees
and Expenses) will be charged to the Borrower's account with the Agent or
Affiliate thereof, and solely with respect to amounts due under Section 4.3(b)
or otherwise upon an Event of Default, the Agent may direct or cause the
Borrower to direct payment from the Theater Renovation Account with respect to
amounts due under Section 4.3(b) or from such other account of the Borrower
subject to a deposit account control agreement in favor of the Agent (and in
form and substance reasonably satisfactory to the Agent) as of the date made, or
the date such other amount is due from the Borrower or is paid or incurred by
the Agent or a Lender, or the date such amount becomes chargeable to the
Borrower's loan account pursuant to Section 11.10 (Fees and Expenses), as the
case may be.
ARTICLE 3
INTEREST AND OTHER CHARGES
3.1 Term Loan A Interest.
(a) Term Loan A Interest Payments During the Initial Interest
Period.
(i) On or before the fifteenth (15th) day after the end of each
Fiscal Quarter during the Initial Interest Period, the Borrower shall pay the
Agent, for the pro rata benefit of the Term Loan A Lenders, an amount equal to
the Term Loan A Interest Amount for the Fiscal Quarter (or portion thereof for
the Fiscal Quarter ending September 30, 2004 and September 30, 2007) last ended
(such Term Loan A Interest Amount shall be calculated by the Borrower based on a
good faith estimate of EBITDA for the Fiscal Quarter (or portion thereof for the
Fiscal Quarter ending September 30, 2004 and September 30, 2007) last ended)
less the Excess Interest
42
Amount, if any, that was credited during the Fiscal Quarter (or portion thereof
for the Fiscal Quarter ending September 30, 2004 and September 30, 2007) last
ended; provided, however, that in no event shall the amount of interest payable
by the Borrower pursuant to this Section 3.1(a)(i) be (i) greater than the
Maximum Term Loan A Rate on the unpaid principal amount of the Term Loan A
during such Fiscal Quarter or (ii) less than the Minimum Term Loan A Rate on the
unpaid principal amount of the Term Loan A during such Fiscal Quarter. The Term
Loan A Interest Amount shall be due and payable as set forth above regardless of
whether a Terrorist Event shall have occurred and the financial covenants shall
have been suspended in accordance with Sections 8.13(c), 8.14(b) or 8.15(b) of
this Agreement. The amount of interest payable under clauses (i) and (ii) in the
proviso in the first sentence of this Section 3.1(a)(i) shall be computed as set
forth in Section 3.5.
(ii) In the event that the amount of interest paid by the Borrower
to the Agent in any Fiscal Year during the Initial Interest Period (the "Annual
Estimated Amount of Interest") differs from the aggregate amount of interest
that would have been payable by the Borrower as a result of the aggregate Term
Loan A Interest Amount based on estimated EBITDA for the four Fiscal Quarters
(or such lesser period for Fiscal Year 2004) during such Fiscal Year being
greater or less than the actual Term Loan A Interest Amount based on EBITDA for
such Fiscal Year (or such lesser period for Fiscal Year 2004) (the "Annual
Actual Amount of Interest"), (A) the Borrower will pay to the Agent within 90
days of the end of such Fiscal Year, the amount equal to the positive
difference, if any, between (i) the Annual Actual Amount of Interest and (ii)
the Annual Estimated Amount of Interest (the amount of such difference shall be
referred to herein as the "Shortfall Interest Amount") or (B) the Agent will
credit to the account of the Borrower with the Term Loan A Lenders an amount
equal to the positive difference, if any, between (i) the Annual Estimated
Amount of Interest and (ii) the Annual Actual Amount of Interest (the "Excess
Interest Amount"). Any amounts payable under this Section 3.1(a)(ii) shall be
due and payable as set forth above regardless of whether a Terrorist Event shall
have occurred and the financial covenants shall have been suspended in
accordance with Sections 8.13(c), 8,14(b) or 8.15(b) of this Agreement.
(b) Term Loan A Interest Payments After the Initial Interest Period.
Commencing on the Interest Payment Date immediately following the third
Anniversary Date (i.e. October 1, 2007) and on each Interest Payment Date
thereafter, the Borrower shall make a payment to the Agent, for the pro rata
benefit of the Term Loan A Lenders, in an amount equal to the Term Loan A
Eurodollar Rate on the unpaid principal amount of the Term Loan A during the
Fiscal Quarter last ended prior to such Interest Payment Date; provided, that
interest payable hereunder on the first Interest Payment Date following the
third Anniversary Date (i.e. October 1, 2007) shall be calculated from and
including the first day after the third Anniversary Date through the end of the
first Fiscal Quarter following the third Anniversary Date (i.e. September 30,
2007). Any amounts payable under this Section 3.1(b) shall be (i) due and
payable as set forth above regardless of whether a Terrorist Event shall have
occurred and the financial covenants shall have been suspended in accordance
with Sections 8.13(c), 8.14(b) or 8.15(b) of this Agreement and (ii) computed as
set forth in Section 3.5.
3.2 Term Loan B Interest. Each Term Loan B shall bear interest from the
Closing
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Date on the unpaid principal amount thereof at a rate per annum equal to the
Term Loan B Eurodollar Rate and such interest shall accrue and be added to the
outstanding principal of the Term Loan B on each Interest Payment Date and
thereafter bear interest at the Term Loan B Eurodollar Rate with respect to the
Term Loan B until paid in full. Any amounts due under this Section 3.2 shall be
(i) due and payable as set forth above regardless of whether a Terrorist Event
shall have occurred and the financial covenants shall have been suspended in
accordance with Sections 8.13(c), 8.14(b) or 8.15(b) of this Agreement and (ii)
computed as set forth in Section 3.5.
3.3 Default Rate. (a) If any Event of Default occurs, (i) during the
period commencing on the Closing Date and ending on the second Anniversary Date,
then, from the date such Event of Default occurs until it is cured or waived or
until all Obligations are paid and performed in full, all outstanding Loans
shall bear interest (as well after as before judgment) at a rate (the "Initial
Default Rate") per annum which is equal to the Prime Lending Rate plus 2% and
(ii) at any time after the second Anniversary Date, then, from the date such
Event of Default occurs until it is cured or waived or until all Obligations are
paid and performed in full, all outstanding Loans shall bear interest (as well
after as before judgment) at a rate (the "Subsequent Default Rate") per annum
which is equal to the then applicable interest rate plus 2%; and (b) if all or a
portion of any interest payable on any Loan or other amount payable hereunder
shall not be paid when due (whether at the stated maturity, by acceleration or
otherwise), (i) during the period commencing on the Closing Date and ending on
the second Anniversary Date such overdue amount shall bear interest at a rate
per annum equal to the Initial Default Rate and (ii) at any time after the
second Anniversary Date such overdue amount shall bear interest at a rate per
annum equal to the Subsequent Default Rate, in each case from the date of such
non-payment until such amount is paid in full (as well after as before
judgment). Interest accruing pursuant to this Section 3.3 on the Term Loan A
shall be payable from time to time on demand and interest accruing pursuant to
this Section 3.3 on the Term Loan B shall accrue and be added to the outstanding
principal of the Term Loan B on each Interest Payment Date and thereafter bear
interest at the Term Loan B Eurodollar Rate until paid.
3.4 Maximum Interest Rate. In no event shall any interest or other charge
hereunder exceed the highest rate permissible under any law which a court of
competent jurisdiction shall, in a final determination, deem applicable hereto.
In the event that a court so determines that any Lender has received interest
and other charges hereunder in excess of the highest rate applicable thereto,
such excess shall be deemed received on account of, and shall automatically be
applied to reduce, the Obligations owed to such Lender other than interest in
the inverse order of maturity, and the provisions hereof shall be deemed amended
to provide for the highest permissible rate. If there are no Obligations
outstanding, then such Lender shall refund such excess to the Borrower.
3.5 Computation of Interest. All computations of interest hereunder shall
be made on a daily basis on the actual number of days elapsed over a year of 360
days. For purposes of determining interest payable under Section 3.1 and Section
3.2, the unpaid principal amount of the applicable Term Loan for each day on
which interest is calculated shall be the unpaid principal amount of such Loan
as of 10:00 a.m. (New York City time) on such day.
44
3.6 Agency and Collateral Monitoring Fee. The Borrower agrees to pay the
Agent for its own account an agency and collateral monitoring fee (the "Agency
and Collateral Monitoring Fee") in the amount of $67,500 per annum (of which
$60,000 per annum is the agency fee and $7,500 per annum is the collateral
monitoring fee), payable in advance on the Closing Date and on each anniversary
of the Closing Date until all Obligations have been paid in full.
3.7 Taxes. (a) All payments made by the Borrower in respect of the
Obligations shall be made free and clear of, and without reduction for or on
account of, any Taxes; provided, however, that the Borrower shall not be
required by this Section to pay or reimburse the Agent or any Lender for (i)
income and franchise taxes, doing business taxes or minimum taxes imposed on or
in respect of any such Person's overall net income or gross receipts from all
operations (or taxes imposed in lieu of such income or franchise taxes on
overall net income, net worth or capital or gross receipts) by the jurisdiction
of organization of the Lender or the jurisdiction in which is located the
Lending Office or other office for payments of such Person, or any political
subdivision or taxing authority thereof or therein, (ii) Taxes imposed solely by
reason of failure by the Agent or any Lender to comply with the requirements of
paragraph (b) of this Section 3.7, (iii) any Taxes in the nature of transfer,
stamp, recording or documentary taxes resulting from a transfer (other than as a
result of foreclosure) by a Lender of all or any portion of its interest in this
Agreement, the Term Loan Notes or any other Loan Documents, and (iv) Taxes which
are finally judicially determined by a court of competent jurisdiction to have
arisen solely as a result of gross negligence or willful misconduct of the Agent
or any Lender (all of the foregoing, except for those taxes excluded by the
proviso to this sentence, being referred to hereinafter as the "Non-Excluded
Taxes"). If any Non-Excluded Taxes are required to be withheld from any amounts
payable to the Agent or a Lender hereunder or under the applicable Term Loan
Note, the amounts so payable to such Person shall be increased to the extent
necessary to yield to such Person (after withholding or payment of all
Non-Excluded Taxes and all Taxes applicable to additional sums payable under
this Section) interest or any such other amounts payable hereunder or thereunder
at the rates or in the amounts specified herein and in the applicable Term Loan
Note as if no such deduction had been made, and the Borrower shall make such
deduction and pay the full amount deducted to the appropriate Governmental
Authority in accordance with applicable law. Whenever any Non-Excluded Tax is
payable by the Borrower, as promptly as possible thereafter, the Borrower shall
send to the Agent a certified copy of an original official receipt showing
payment thereof. If the Borrower fails to pay any Non-Excluded Taxes when due to
the appropriate taxing authority or fails to remit to the Agent the required
receipts or other required documentary evidence, the Borrower shall indemnify
the Agent, or the Lender, as the case may be, for any incremental Taxes,
interest or penalties that may become payable by such Person as a result of any
such failure. This indemnification shall be made within 30 days from the date
the Agent or such Lender (as the case may be) makes written demand therefor. If
any Lender receives a refund or credit or otherwise would have received a refund
or credit but for the offset of the amount of such refund against such Lender's
Taxes (that are not otherwise indemnifiable by the Borrower) (a "Tax Refund"),
which in the good faith judgment of such Lender is allocable to the Borrower, it
shall promptly pay such Tax Refund (net of (i) any Taxes and net income or
franchise taxes imposed on the Lender with respect to the Tax Refund and (ii)
any costs or expenses incurred in obtaining such Tax Refund) to the Borrower.
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(b) Each Lender or transferee or assignee (including a participation
holder) thereof (any such entity, a "Transferee") that is not a "United States
person", as defined in Section 7701(a)(30) of the Code, agrees that it will
deliver to the Borrower and the Agent on or before the date it becomes a Lender
or Transferee (x) two duly completed copies of United States Internal Revenue
Service Form W-8BEN or successor applicable form certifying that under an
applicable treaty such Lender or Transferee is entitled to receive all payments
under this Agreement without deduction or withholding of any United States
federal income taxes (or, in the case of a Transferee, that any such deduction
or withholding is no greater than it would have been for the Lender (or the
Transferee) that transferred or assigned its interest to such Transferee), (y)
two duly completed copies of United States Internal Revenue Service Form W-8ECI
or successor applicable form, or (z) two duly completed copies of United States
Internal Revenue Service Form W-8BEN or successor applicable form and a
statement in the form of Exhibit F hereto. Each such Lender or Transferee also
agrees (x) to deliver to the Borrower and the Agent two further copies of the
said statement and Form W-8BEN or W-8ECI or successor applicable forms or other
manner of certification, as the case may be, on or before the date reasonably
requested in writing by the Borrower or the Agent, and (y) to obtain such
extensions of the time for filing and to renew such statements or forms and
certifications thereof as may reasonably be requested by the Borrower or the
Agent, unless in any such case any change in treaty, law or regulation (or the
interpretation thereof) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such statements or forms
inapplicable or which would prevent such Lender or Transferee from duly
completing and delivering any such statement or form with respect to it and such
Lender or Transferee so advises the Borrower and the Agent. Such Lender or
Transferee shall certify in the case of a Form W-8BEN or W-8ECI (and, if
applicable, the statement) that it is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes (or, in the case of a Transferee, that any such deduction or withholding
is no greater than it would have been for the Lender or the Transferee that
transferred or assigned its interest to such Transferee). Such Lender or
Transferee shall, promptly upon the written request of the Borrower to that
effect, deliver to the Borrower such other forms or similar documentation as may
be required from time to time by any applicable law, treaty, rule or regulation
(or the interpretation thereof) in order to establish such Lender's or
Transferee's tax status for withholding purposes (to the extent that it is then
legally permitted to do so). Such Lender or Transferee also shall notify the
Borrower promptly after any change in any applicable law or regulation or in the
written interpretation thereof by any Governmental Authority applicable to such
Lender or Transferee that results in such Lender or Transferee no longer being
capable of receiving payments under this Agreement without any deduction or
withholding of United States federal income tax. Each Lender or Transferee that
is a "United States person", as defined under Section 7701(a)(30) of the Code,
and that is not a corporation agrees that it will deliver to the Borrower and
the Agent a Form W-9 stating that it is entitled to an exemption from United
States backup withholding tax.
46
3.8 Requirements of Law. In the event that after the date of this
Agreement any change in law, regulation, treaty, or directive or any change
therein or in the interpretation or application thereof, or compliance by any
Lender with any request or directive (whether or not having the force of law) of
any central bank or other Governmental Authority : (a) does or shall subject any
Lender (or any corporation controlling a Lender) to any tax of any kind
whatsoever with respect to any Loan or change the basis of taxation of payments
to such Lender of principal, interest, or any other amount payable in respect of
any Loan (other than Non-Excluded Taxes and except for changes in the rate of
tax on or in respect of such Person's overall net income, net worth or capital
or gross receipts); (b) does or shall impose, modify, deem applicable, or result
in the application of any reserve, special deposit, compulsory loan or similar
requirement against loans or loan commitments made by a Lender or against any
other extensions of credit or commitments to extend credit or other assets of or
any deposits or other liabilities taken or entered into by a Lender and which
was not otherwise included in determining the rate of interest on the Loans of
such Lender; or (c) imposes on a Lender (or any corporation controlling a
Lender) any other condition regarding this Agreement; and the result of any such
event shall be to increase the cost to a Lender (or any corporation controlling
a Lender) of making or maintaining the Loans or the other Obligations of the
Borrower hereunder or to reduce the amounts receivable by such Person hereunder
then, within 30 days after written demand by such Lender, the Borrower shall,
subject to the provisions of Section 4.8 (Regulatory Replacement of Lenders),
either (a) immediately pay to the appropriate Lender, from time to time as
specified by such Person, additional fees which shall be sufficient to
compensate such Person (or any corporation controlling such Person) for such
increased cost or reduction in amounts receivable, or (b) pay all outstanding
Obligations and terminate this Agreement, paying the foregoing fees to the date
of termination. Such Lender will promptly notify the Borrower of any event
occurring after the date of this Agreement of which it has actual knowledge,
that will entitle such Lender to compensation pursuant to this Section 3.8 and
will designate a different Lending Office if such designation will avoid the
need for, or reduce the amount of, such compensation, provided that such
designation is permitted by applicable law and does not result in any tax,
reserve, special deposit or other obligation or any increased cost to such
Lender. Upon the occurrence of any event referred to above, the affected Person
shall send the Agent and the Borrower a certificate setting forth in reasonable
detail the increased cost or reduction in amounts receivable, which certificate
shall be conclusive, absent manifest error or bad faith, as to the amount
thereof.
3.9 Capital Adequacy Costs. If after the date of this Agreement the
introduction of or any change in (a) the judicial, administrative, or other
governmental interpretation of any law or regulation or (b) compliance by a
Lender (or any corporation controlling a Lender) with any guideline or request
from any central bank or other Governmental Authority (whether or not having the
force of law) has the effect of requiring an increase in the amount of capital
required or expected to be maintained by such Lender or any corporation
controlling such Lender, and such Lender determines in good faith that such
increase is based upon its transactions with the Borrower hereunder, then,
subject to the provisions of Section 4.8 (Regulatory Replacement Lenders), then
within 30 days after written demand by such Lender, the Borrower shall either:
(x) pay to such Lender such additional amount as such Lender shall certify in
good faith to be the amount allocable to its transactions with the Borrower
hereunder; or (y) pay to the Lenders all outstanding Obligations and terminate
this Agreement. Such Lender will notify the Borrower
47
and the Agent of any event occurring after the date of this Agreement that will
entitle such Lender to compensation pursuant to this Section as promptly as
practicable after such Lender obtains Knowledge thereof and determines to
request such compensation. Such Lender's determination for purposes of this
Section of the effect of any increase in the amount of capital required to be
maintained by it and of the amount allocable to its transactions with the
Borrower hereunder shall be conclusive, provided that such determination is made
on a reasonable basis. For purposes of this Section, in calculating the amount
necessary to compensate a Lender for any increase in or imposition of capital
requirements, such Lender shall be deemed to be entitled to a rate of return on
capital per annum (after federal, state and local taxes) equivalent to that
which it would have received had such increase in or imposition of capital
requirements not occurred.
3.10 Inability to Determine Interest Rate. In the event that the Agent or
any Lender shall have determined (which determination shall be conclusive and
binding upon the Borrower) that by reason of circumstances affecting the
interbank Eurodollar market, adequate and reasonable means do not exist for
ascertaining LIBOR for any Interest Period with respect to any Eurodollar Loans,
or that LIBOR as so ascertained will not accurately reflect such Lender's cost
of creating or maintaining such Loan, or Dollar deposits in the relevant amount
and for the relevant Interest Period are not available to such Lender in its
relevant market, then any Lender making such determination shall so notify the
Agent, and the Agent in either case shall forthwith give prompt telephonic
notice of such determination, confirmed in writing, to the Borrower. If such
notice is given and until such notice has been withdrawn by the Agent, any
requested Eurodollar Loan shall be made as a Prime-Based Loan; provided,
however, that such Lender shall promptly notify the Agent and the Agent shall
forthwith give prompt telephonic notice thereof to the Borrower, confirmed in
writing to the Borrower, if the circumstances giving rise to such situation no
longer exist. Until such notice has been withdrawn by the Agent, as the case may
be, no further Eurodollar Loans shall be made, nor shall any Eurodollar Loan be
renewed.
3.11 Indemnity. The Borrower agrees to indemnify each Lender against, to
hold each Lender harmless from and to pay to the Agent on such Lender's behalf
on demand, any cost, loss or expenses which such Lender may sustain or incur as
a consequence of (a) default by the Borrower in payment of the principal amount
of or interest on any Eurodollar Loan, including, but not limited to, any such
loss or expense arising from interest or fees payable by a Lender to lenders of
funds obtained by it in order to maintain such Eurodollar Loan, (b) failure by
the Borrower to make a renewal of a Loan after the Borrower has given a notice
in accordance with the terms hereof, unless such failure is as a result of the
provisions of Section 3.12, or (c) repayment of a Eurodollar Loan on a day which
is not the end of the Interest Period with respect thereto, including, but not
limited to, any such loss or expense arising from interest or fees payable by
any Lender to lenders of funds obtained by it in order to maintain such
Eurodollar Loan. Notice of a claim thereunder shall be given to the Borrower by
the Agent within 90 days of the payment of any Eurodollar Loan. The Borrower
shall pay such Lender the amount shown as due on any such notice of claim within
30 days after receipt thereof.
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3.12 Illegality. If, after the date of this Agreement, the adoption of any
applicable law, rule or regulation, or any change therein, or any change in the
interpretation or administration thereof by any Governmental Authority, or
compliance by a Lender with any request or directive (whether or not having the
force of law) of any such Governmental Authority shall make it unlawful or
impossible for such Lender to make, maintain or fund Eurodollar Loans, then such
Lender shall forthwith so notify the Borrower and the Agent. Before giving any
such notice to the Borrower and the Agent, such Lender shall designate a
different Lending Office if such designation will avoid the need for giving such
notice, provided that such designation is permitted by applicable law and does
not result in any tax, reserve, special deposit or other obligation or any
increased cost to such Lender. Upon giving of such notice by such Lender, such
Lender's obligation to make Eurodollar Loans shall be suspended, and the
Borrower shall convert then-outstanding principal amount of each Eurodollar Loan
(on either (a) the last day of then-current Interest Period applicable to such
Eurodollar Loan if such Lender may lawfully continue to maintain and fund such
Eurodollar Loan to such day or (b) immediately, if such Lender may not lawfully
continue to fund and maintain such Eurodollar Loan to such day) into a
Prime-Based Loan in an equal principal amount.
3.13 Replacement by the Borrower of a Lender.
(a) Acquired Lender. If any Lender is acquired by or merges with any
other Person (including any other Lender) and (i) such Lender is not the
surviving Person, and (ii) there exits no Event or Event of Default hereunder,
the Borrower may replace such Lender in whole in the event that the surviving
Person is not an Eligible Assignee with an Eligible Assignee reasonably
acceptable to the Agent pursuant to an Assignment Agreement within 30 days
following the date of consummation of any such acquisition or merger.
(b) Certain Circumstances. If (i) there exists no Event or Event of
Default on any such date and no Event or Event of Default shall be caused by the
action permitted below and (ii) any one Lender refuses to consent to any
amendment, waiver or consent to any provision hereof or in any Loan Documents in
accordance with the terms of Section 11.14 of this Agreement (other than an
amendment to increase the Commitment of such Lender), but to which each other
Lender has previously agreed in writing, then the Borrower may, within 45 days
after the date of such consent, amendment or waiver, replace such Lender in
whole with another Eligible Assignee reasonably acceptable to the Agent,
pursuant to an Assignment Agreement.
ARTICLE 4
PAYMENTS AND PREPAYMENTS
4.1 Principal Payments.
(a) Excess Cash Flow Principal Payments. From and after the date
that the Reserve Amount equals $30,000,000 (and thereafter without regard to any
decrease in the Reserve Amount) until the Term Loan A is paid in full, the
Borrower shall pay the Agent, for the pro rata benefit of the Term Loan A
Lenders, on or before the first day of the immediately
49
succeeding Fiscal Quarter (the "Initial Excess Cash Flow Principal Payment
Date") and on each anniversary and sixth month anniversary of the Initial Excess
Cash Flow Principal Payment Date, an amount equal to (i) 100% of the Excess Cash
Flow in the event that the Leverage Ratio is equal to or greater than 4.00:1.00
for either of the two Fiscal Quarters most recently ended, (ii) 75% of the
Excess Cash Flow in the event that the Leverage Ratio is less than 4.00:1.00 for
each of the two Fiscal Quarters most recently ended but greater than 3.50:1.00
for either of the two Fiscal Quarters most recently ended and (iii) 50% of
Excess Cash Flow in the event that the Leverage Ratio is less than or equal to
3.50:1.00 for each of the two Fiscal Quarters most recently ended. The Excess
Cash Flow amount referred to in clauses (i)- (iii) shall be with respect to the
two Fiscal Quarters most recently ended.
The following examples are provided for purposes of clarity:
(1) Leverage Ratio is 3.3:1.00 at end of Fiscal Quarter 1 and the Leverage
Ratio is 3.7 at end of Fiscal Quarter 2, the Borrower must pay the Agent 75% of
Excess Cash Flow.
(2) Leverage Ratio is 3.7:1.00 at end of Fiscal Quarter 1 and the Leverage
Ratio is 3.3 at end of Fiscal Quarter 2, the Borrower must pay the Agent 75% of
Excess Cash Flow.
(b) Term Loan A Scheduled Installments of Principal Payments
Following Initial Interest Period. Unless sooner payable as provided in Sections
9.2 (Remedies), 10.2 (Termination by the Borrower) and 10.3 (Termination by the
Required Term Loan A Lenders), the Term Loan A shall be paid by the Borrower to
the Agent in the following installments, in addition to the Excess Cash Flow
principal payment required under Section 4.1(a) above and any other payments
required under Section 4.3 or any other provision of this Agreement:
(i) $1,250,000 on the first day of each Fiscal Quarter during
the period beginning on the second Anniversary Date and ending on the
third Anniversary Date;
(ii) $3,750,000 on the first day of each Fiscal Quarter during
the period beginning on the third Anniversary Date and ending on the
fourth Anniversary Date;
(iii) $5,000,000 on the first day of each Fiscal Quarter
during the period beginning on the fourth Anniversary Date and ending on
the fifth Anniversary Date;
(iv) $6,250,000 on the first day of each Fiscal Quarter during
the period beginning on the fifth Anniversary Date and ending on the
Maturity Date; and
(v) the then unpaid amount of the Term Loan A on the Maturity
Date.
All payments made pursuant to Section 4.1(a) and (b) shall be applied to the
payment of the Term Loan A for the pro rata benefit of the Term Loan A Lenders.
(c) Term Loan B Principal Payments. Except as provided in Section
4.2 or Section 4.3 or unless sooner payable as provided in Sections 9.2
(Remedies), 10.2 (Termination
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by the Borrower) and 10.3 (Termination by the Required Term Loan A Lenders), no
principal payments on the Term Loan B shall be due or payable until the Maturity
Date.
(d) Principal Payment at Maturity. The Borrower shall pay the unpaid
principal balance of the Loan together with all other Obligations in a single
installment on the Maturity Date.
4.2 Optional Prepayments of Term Loans. Optional prepayments of each of
the Term Loan A and Term Loan B may be made by the Borrower to the Agent,
without penalty or premium but subject to the payment of the amounts set forth
in Section 3.11 (Indemnity) with respect to Eurodollar Loans being prepaid prior
to the expiration date of the Interest Period applicable thereto, on one or more
occasions in a minimum amount of $5,000,000 or more (in $1,000,000 increments),
upon three (3) Business Days' prior written notice to the Agent to be applied
first, to the prepayment of the Term Loan A pro rata to the then unpaid amounts
of the Term Loan A and second, after the Term Loan A has been repaid in full
(including all accrued and unpaid interest thereon and all other obligations
associated therewith), to the prepayment of the Term Loan B pro rata to the then
unpaid amounts of the Term Loan B. During the Initial Interest Period, interest
on any prepayments made under this Section 4.2 shall be paid in accordance with
Section 3.1(a)(i) of this Agreement.
4.3 Mandatory Prepayments.
(a) Payments Relating to Development of Time Share Premises. The
Borrower shall assign and pay to the Agent, no later than 20 days after the end
of each calendar month, 100% of any Marketing Fees it receives during such
calendar month; provided that the Borrower may withhold from such payment an
amount equal to the Tax Liability for such calendar month with respect to the
taxable income derived from such Marketing Fees. For this purpose, the Tax
Liability with respect to the taxable income derived from such Marketing Fees
shall be an amount (not less than zero) equal to the product of (A) the
Borrower's Tax Liability for the relevant calendar month (determined by an
interim closing of its books) and (B) a fraction, (i) the numerator of which is
the Borrower's taxable income from such Marketing Fees for such calendar month
computed as if the Borrower were a corporation subject to federal income tax for
such purposes, and (ii) the denominator of which is the Borrower's total taxable
income for such calendar month computed on the same basis. Additionally, in the
event that Holdings, any Affiliate of Holdings, the Investor Group or any
Affiliate of the Investor Group makes any Disposition of the Time Share Premises
after the Closing Date (other than pursuant to a Time Share Plan), the Borrower
shall, within five (5) days after any such Disposition, pay the Agent (or cause
the Agent to be paid) the amount by which (i) the Net Cash Proceeds received,
directly or indirectly, by the Borrower, any Affiliate of the Borrower,
Holdings, any Affiliate of Holdings, the Investor Group or any Affiliate of the
Investor Group from any such Disposition or any subsequent Disposition (other
than in connection with a Time Share Plan) exceeds (ii) $14,000,000.
(b) Renovation Capital Expenditures. The Borrower is required under
Section 7.13 to spend and pay not less than $90,000,000 on and for Renovation
Capital
51
Expenditures. If, by the (A) First Renovation Capital Expenditure Measurement
Date, the Borrower has not spent and paid at least $72,000,000 on and for
Renovation Capital Expenditures, the Borrower shall by the 30th day following
the First Renovation Capital Expenditure Measurement Date, pay the Agent the
difference between (x) $72,000,000 and (y) the amount spent and paid on and for
Renovation Capital Expenditures as of the First Renovation Capital Expenditure
Measurement Date, (B) Second Renovation Capital Expenditure Measurement Date,
the Borrower has not spent and paid an aggregate amount of $81,000,000 on and
for Renovation Capital Expenditures, the Borrower shall by the 30th day
following the Second Renovation Capital Expenditure Measurement Date, pay the
Agent the difference between (x) $81,000,000 and (y) the sum of (i) the amount
spent and paid on and for Renovation Capital Expenditures through the Second
Renovation Capital Expenditure Measurement Date and (ii) the amount paid to the
Agent by the Borrower in accordance with clause (A) of this Section 4.3(b)
through the Second Renovation Capital Expenditure Measurement Date and (C) Third
Renovation Capital Expenditure Measurement Date, the Borrower has not spent and
paid an aggregate amount of $90,000,000 on Renovation Capital Expenditures, the
Borrower shall by the 30th day following the Third Renovation Capital
Expenditure Measurement Date, pay the Agent the difference between (x)
$90,000,000 and (y) the sum of (i) the amount spent and paid for Renovation
Capital Expenditures through the Third Renovation Capital Expenditure
Measurement Date and (ii) the aggregate amount paid to the Agent by the Borrower
in accordance with clauses (A) and (B) of this Section 4.3(b) through the Third
Renovation Capital Expenditure Measurement Date. If any amount required to be
paid to the Agent pursuant to the immediately preceding sentence is not paid
when due, the Agent may, without further notice or demand, (i) draw upon the
Letter of Credit in an amount equal to the amount due to the Agent, (ii) charge
or direct the payment from the Renovation Capital Expenditure Account or the
Theater Renovation Account, in each case, pursuant to Section 2.7 in an amount
equal to the amount due to the Agent or (iii) in the event that the Agent does
not receive sufficient funds from taking the actions described in clauses (i)
and (ii) of this sentence, exercise any other rights or remedies pursuant to the
Loan Documents. The Agent drawing upon the Letter of Credit or charging the
Borrower's loan account shall constitute a payment for purposes of determining
clauses (B)(y)(ii) and (C)(y)(ii) of this Section 4.3(b). The Borrower hereby
acknowledges and agrees that the $14,000,000 payment described in Section
5.1(x), shall not reduce the $90,000,000 of Renovation Capital Expenditures
required to be made pursuant to this Section 4.3(b).
(c) Proceeds of Other Asset Transfers. If the Borrower or any of its
Subsidiaries shall receive Net Cash Proceeds from any Asset Transfers or
Casualty Events (other than Net Cash Proceeds required to be paid to the Agent
to the extent provided in Section 4.3(a)), then, within fifteen (15) days of
providing the notice required under Section 7.3(l), the Borrower (for itself and
on behalf of any Subsidiary effecting the Asset Transfer) shall pay such Net
Cash Proceeds to the Agent who shall apply such Net Cash Proceeds toward the
prepayment of the Term Loans as set forth in Section 4.3(e) below; provided,
that, notwithstanding the foregoing, (i) the Borrower may elect (a "Reinvestment
Election") to exclude from the foregoing requirement amounts with respect to the
relevant Asset Transfers or Casualty Events to the extent that such are to be
reinvested in Reinvestment Assets (the "Reinvestment Amount") by delivering to
the Agent a written Reinvestment Notice delivered with the information required
52
under Section 7.3(h) setting forth the anticipated Reinvestment Amount (the
"Notified Reinvestment Amount"), whereupon the Borrower and its Subsidiaries
shall have eighteen (18) months from the date of such notice in which to
reinvest such Reinvestment Amount in Reinvestment Assets, subject however to the
provisions of Section 7.19 with respect to Casualty Events; provided, that the
Reinvestment Amounts so specified in any eighteen (18) month period (including
insurance proceeds or condemnation awards for Casualty Events) shall not exceed
the amounts set forth in Section 8.12 for any such eighteen (18) month period,
provided, further, that after six (6) months following the end of the month to
which the Reinvestment Notice relates, the Agent may in its reasonable
discretion (acting upon the direction of the Required Term Loan A Lenders)
establish reserves in respect of the Reinvestment Amount not yet reinvested and
provided further, that on the Reinvestment Prepayment Date with respect to a
Reinvestment Election, the Borrower shall pay to the Agent an amount equal to
the Reinvestment Prepayment Amount, if any, for application as provided in
Section 4.3(e).
(d) Application of Funds from Time Share Premises. Amounts to be
applied in connection with prepayments made pursuant to clause (a) above and the
payment required by Section 5.1(x) shall be applied as follows: first, the
Initial Time Share Premises Payment (which shall be an amount of Net Cash
Proceeds equal to the greater of (i) $20,000,000 and (ii) the Fair Market Value
of the Time Share Premises as determined by the FF&E Lender Appraisal (in each
such case which shall include the payment of such $14,000,000 on account of the
Time Share Premises to the extent paid in accordance with Section 5.1(x)) shall
be applied to the prepayment of the Term Loan A pro rata to the then unpaid
amounts of the Term Loan A held by all Term Loan A Lenders other than the FF&E
Lender, second, after the application of the Initial Time Share Premises
Payment, to the prepayment of the Term Loan A pro rata to the then unpaid
amounts (without taking into account the Initial Time Share Premises Payment
referred to above) of the Term Loan A held by all Term Loan A Lenders including
the FF&E Lender, and third, after the Term Loan A has been repaid in full
(including all accrued and unpaid interest thereon and all other obligations
associated therewith), to the prepayment of the Term Loan B pro rata to the then
unpaid amounts of the Term Loan B. After receipt by the Required Term Loan A
Lenders (other than the FF&E Lender) of the Initial Time Share Premises Payment,
all references in this Agreement to the Required Term Loan A Lenders with
respect to the Time Share Premises shall include the FF& E Lender.
(e) Application of Other Mandatory Principal Payments. Amounts to be
applied in connection with prepayments made pursuant to clauses (b) and (c)
above shall be applied first, to the prepayment of the Term Loan A pro rata to
the then unpaid amounts of the Term Loan A, and second, after the Term Loan A
has been repaid in full (including all accrued and unpaid interest thereon and
all other obligations associated therewith), to the prepayment of the Term Loan
B pro rata to the then unpaid amounts of the Term Loan B.
Each prepayment of the Loans under this Section 4.3 shall be accompanied
by accrued interest (which, in the case of the Term Loan B, may, at the option
of the Borrower, be added to the outstanding principal of the Term Loan B (after
giving effect to any such prepayment) and bear interest at the Term Loan B
Eurodollar Rate until paid in full) to the date of such prepayment on the amount
prepaid; provided, however, that during the Initial Interest Period,
53
interest on any prepayments of the Term A Loan under this Section 4.3 shall be
paid in accordance with Section 3.1(a)(i) of this Agreement.
4.4 Payments, No Reborrowings. (a) Each payment (including each
prepayment) by the Borrower on account of (i) principal and interest on the Term
Loan A and any other amounts payable to the Term Loan A Lenders shall be made by
the Agent pro rata according to the respective Term Loan A Percentages of all of
the Term Loan A Lenders and (ii) principal and interest on the Term Loans B and
any other amounts payable to the Term Loan B Lenders shall be made by the Agent
pro rata according to the respective Term Loan B Percentages of all of the Term
Loan B Lenders.
(b) Amounts prepaid on account of the Term Loans may not be
reborrowed.
4.5 Place and Form of Payments; Extension of Time. All payments of
principal, interest, and other sums due to the Agent, or any Lender shall be
made without offset, defense, or counterclaim at the Agent's address set forth
in Section 11.11 of this Agreement. All such payments shall be made in Dollars
and in immediately available funds. All payments required to be made to the
Agent hereunder shall be made not later than 2:00 p.m. New York City time. Funds
received after that time shall be deemed to have been received by the Agent on
the next Business Day. If any payment of principal, interest, or other sum to be
made hereunder becomes due and payable on a day other than a Business Day, then,
except as otherwise provided herein, the due date of such payment shall be
extended to the next succeeding Business Day and interest thereon shall be
payable at the applicable interest rate during such extension.
4.6 Sharing of Payments. (a) If any Term Loan A Lender shall obtain any
payment or reduction (including, without limitation, any amounts received as
adequate protection of a deposit treated as cash collateral under the Bankruptcy
Code) of any Obligations of the Borrower hereunder (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) which
exceeds its ratable share of payments or reductions on account of such
Obligations obtained by all the Term Loan A Lenders under the Facility (other
than payments under Section 3.7, 3.8, 3.9, 3.11 and/or 4.3) such Term Loan A
Lender shall promptly (i) notify the Agent of such receipt, and (ii) purchase
from the other Term Loan A Lenders under the Facility such participations in the
affected Obligations as shall be necessary to cause such purchasing Term Loan A
Lender to share the excess payment or reduction, net of costs incurred in
connection therewith, ratably with each of them; provided that if all or any
portion of such excess payment or reduction is thereafter recovered from such
purchasing Term Loan A Lender or additional costs are incurred, the purchase
shall be rescinded and the purchase price restored to the extent of such
recovery or such additional costs, but without interest. The Borrower agrees
that any Term Loan A Lender so purchasing a participation from another Term Loan
A Lender pursuant to this Section may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Term Loan A Lender were the direct
creditor of the Borrower in the amount of such participation. For the purposes
of this Section, a Term Loan A Lender shall be deemed to have received a payment
of the Obligations when it exercises a right of set-off against Property of the
Borrower or a Subsidiary unless such Property was being held expressly and
solely for or in connection with a
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transaction unrelated to the transactions contemplated by the Loan Documents.
(b) Should any payment or distribution of any kind or character,
whether in cash, property, instrument, or proceeds thereof, be received by any
Term Loan B Lender in respect of the Term Loan B prior to the payment in full of
the Term Loan A, such Term Loan B Lender shall receive and hold the same in
trust, as trustee, for the benefit of the Term Loan A Lenders, segregated from
other funds and property of such person and shall forthwith deliver the same to
the Agent (together with any endorsement or assignment of such Term Loan B
Lender when necessary), for application to the Term Loan A, until the Term Loan
A is paid in full.
(c) If at any time after the payment in full of the Term Loan A, any
Term Loan B Lender shall obtain any payment or reduction (including, without
limitation, any amounts received as adequate protection of a deposit treated as
cash collateral under the Bankruptcy Code) of any Obligations of the Borrower
hereunder (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) which exceeds its ratable share of payments or reductions
on account of such Obligations obtained by all the Term Loan B Lenders under the
Facility (other than payments under Section 3.7, 3.8, 3.9, 3.11 and/or 4.3) such
Term Loan B Lender shall promptly (i) notify the Agent of such receipt, and (ii)
purchase from the other Term Loan B Lenders under the Facility such
participations in the affected Obligations as shall be necessary to cause such
purchasing Term Loan B Lender to share the excess payment or reduction, net of
costs incurred in connection therewith, ratably with each of them; provided that
if all or any portion of such excess payment or reduction is thereafter
recovered from such purchasing Term Loan B Lender or additional costs are
incurred, the purchase shall be rescinded and the purchase price restored to the
extent of such recovery or such additional costs, but without interest. The
Borrower agrees that any Term Loan B Lender so purchasing a participation from
another Term Loan B Lender pursuant to this Section may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Term Loan B
Lender were the direct creditor of the Borrower in the amount of such
participation. For the purposes of this Section, a Term Loan B Lender shall be
deemed to have received a payment of the Obligations when it exercises a right
of set-off against Property of the Borrower or a Subsidiary unless such Property
was being held expressly and solely for or in connection with a transaction
unrelated to the transactions contemplated by the Loan Documents.
4.7 Indemnity for Returned Payments. If after receipt of any payment of,
or Proceeds applied to the payment of, all or any part of the Obligations, any
Lender is for any reason required to surrender such payment or Proceeds to any
Person, because such payment or Proceeds is invalidated, declared fraudulent,
set aside, determined to be void or voidable as a preference, or a diversion of
trust funds, or for any other reason, then: the Obligations or the part thereof
intended to be satisfied shall be revived and continue and this Agreement shall
continue in full force as if such payment or Proceeds had not been received by
such Lender, and within 30 days after demand therefor, the Borrower shall
indemnify such Person and hold such Person harmless, from and against the amount
of such payment or Proceeds surrendered. The Agent shall reflect the surrender
of such payment or Proceeds, and any subsequent payment by the Borrower to such
Lender pursuant to this Section 4.7, in the applicable loan account. The
55
provisions of this Section 4.7 shall be and remain effective notwithstanding any
contrary action which may have been taken by such Lender in reliance upon such
payment or Proceeds, and any such contrary action so taken shall be without
prejudice to such Lender's rights under the Loan Documents and shall be deemed
to have been conditioned upon such payment or Proceeds having become final and
irrevocable. The provisions of this Section 4.7 shall survive the termination of
this Agreement and the final and full payment and performance of the
Obligations.
4.8 Regulatory Replacement of Lender. If the Borrower receives a
certificate from a Lender pursuant to Section 3.8 (Requirements of Law) or 3.9
(Capital Adequacy Costs) setting forth increased fees and other costs to be
charged to the Borrower as a result of any event set forth in either such
section, then, solely as a result of receiving such certificate, the Borrower
may replace such Lender with another lender approved by the Agent, which
approval shall not be unreasonably withheld (any such replacement being referred
to herein as a "Regulatory Replacement"). During the 90-day period commencing on
the date the Borrower receives such certificate under Section 3.8 or 3.9 (the
"Suspension Period"), the Borrower shall not be required to pay the increased
fees and other costs specified in such certificate for such 90-day period (but
such fees and costs shall accrue during such period). In order to make a
Regulatory Replacement, the Borrower must (a) give the Agent a written notice of
its intention to do so, which notice must be received by the Agent during the
Suspension Period and no later than ten Business Days prior to the proposed date
for the Regulatory Replacement and (b) consummate the Regulatory Replacement
within 90 days after the Agent receives such notice. If the Borrower makes a
timely Regulatory Replacement, it shall be required to pay the increased fees
and other costs which have accrued under Section 3.8 or 3.9 during the
Suspension Period in respect of the event described in the Lender's certificate,
after the end of the Suspension Period and on or prior to the date of the
Regulatory Replacement. If the Borrower does not make a timely Regulatory
Replacement (whether or not it gave notice to do so), then, at the end of the
Suspension Period, the Borrower shall immediately pay all fees and other charges
under Section 3.8 or 3.9 that were set forth in the Lender's certificate and
that accrued during the Suspension Period, and shall pay all such fees and other
charges accruing thereafter when due in accordance with Section 3.8 or 3.9. Upon
the Regulatory Replacement of a Lender, such Lender shall assign its Term Loans
and other rights and obligations under this Agreement and the other Loan
Documents to the new lender without recourse pursuant to a written agreement
meeting the requirements of Section 11.13(b) and otherwise mutually reasonably
acceptable to such Lender, the Borrower and the new lender, and the new lender
shall thereafter constitute a Lender hereunder for all purposes to the same
extent as if the assignment had been made pursuant to Section 11.13.
4.9 Replacement of Lender Due to Gaming Authorities. If any Gaming
Authority shall determine in a non-appealable final order that any Lender (an
"Unsuitable Lender") does not meet the suitability standards prescribed under
any applicable Gaming Law or the suitability standards of such Gaming Authority,
as the case may be, the Borrower may give notice in writing to the Agent and
such Unsuitable Lender of its intention to replace such Unsuitable Lender with a
financial institution designated in such notice. If the Agent shall, in the
exercise of its reasonable discretion and promptly following its receipt of such
notice, notify the Borrower and such Unsuitable Lender in writing that the
designated financial institution is satisfactory to the Agent (such consent not
being required where such financial institution is already a Lender or an
56
Approved Fund), then such Unsuitable Lender shall, subject to the payment of any
amounts due pursuant to Sections 3.7, 3.8, 3.9 and 3.11 by the Borrower, assign,
in accordance with Section 11.13, its Term Loan Notes and other rights and
obligations under this Agreement and all other Loan Documents to such designated
financial institution without recourse pursuant to a written agreement meeting
the requirements of Section 11.13(b) and otherwise mutually reasonably
acceptable to such Unsuitable Lender and the new lender, and the new lender
shall thereafter constitute a Lender hereunder for all purposes to the same
extent as if the assignment had been made pursuant to Section 11.13. The
Borrower shall pay to the Unsuitable Lender and the Agent all reasonable
out-of-pocket expenses incurred by the Unsuitable Lender and the Agent in
connection with such assignment and assumption.
4.10 Agent's and Lenders' Books and Records. The Borrower agrees that the
Agent's and each Lender's books and records showing the Obligations and the
transactions pursuant to this Agreement and the other Loan Documents shall be
admissible in any action or proceeding arising therefrom, and shall constitute
prima facie proof thereof, irrespective of whether any Obligation is also
evidenced by a promissory note or other instrument.
4.11 Register. The Agent shall maintain a register (the "Register")
showing each Lender of a Loan hereunder. Any transfer or attempted transfer of a
Term Loan Note in violation of any provision of this Agreement shall be null and
void, and the Agent shall not record such transfer on the Register or treat any
purported transferee of a Term Loan Note as the owner of such Term Loan Note for
any purpose.
ARTICLE 5
CONDITIONS PRECEDENT
5.1 Lender Conditions Precedent. The Lenders will be obligated to make the
Term Loans, on the Closing Date, if the following conditions precedent have been
satisfied or waived by the Agent on or before the Closing Date as determined by
the Agent (acting on the reasonable direction of the Required Lenders):
(a) Term Loan Notes and Loan Documents. The Agent on behalf of each
Lender shall have received the Term Loan Notes duly executed by the Borrower,
together with fully executed and, where appropriate, acknowledged counterparts
of this Agreement and each of the other Loan Documents.
(b) Delivery of Documents. The Borrower shall have delivered, or
cause to be delivered, to the Agent on behalf of the Lenders an opinion of
counsel to the Borrower substantially in the form of Exhibit G hereto, and such
other documents, instruments, certificates and agreements as the Required Term
Loan A Lenders shall reasonably request in connection herewith, duly executed by
all parties thereto other than the Lenders or the Agent, and in form and
substance reasonably satisfactory to the Agent and the Lenders and their
respective counsel.
(c) Confirmation of Plan of Reorganization; Effective Date. The
Confirmation
57
Order shall be in full force and effect and shall not have been reversed,
stayed, modified or amended absent the prior written consent of the Lenders and
the Borrower. The Agent shall have received evidence reasonably satisfactory to
it that the Effective Date shall occur contemporaneously with the Closing Date
hereunder.
(d) Fees. The Borrower shall have paid in full the Agency and
Collateral Monitoring Fee due on the Closing Date and any other fees (including,
without limitation, a fee in the amount of 25 basis points payable to each of
the Lenders listed on Schedule 5.1(d) which fee shall be calculated based on
each such Lender's pro rata share of the total Commitment of all of the Lenders
as of the Closing Date (before giving effect to the $14,000,000 payment required
by Section 5.1(x))) then owing by the Borrower under this Agreement for which
invoices containing a general description thereof have been received by the
Borrower at least two (2) days prior to the Closing Date.
(e) Financial Statements. The Agent shall have received the most
recent Form 10-Q filed by BH/RE with the United States Securities and Exchange
Commission for the six month period ending June 30, 2004.
(f) Cash Management Arrangements. The Required Term Loan A Lenders
shall be reasonably satisfied as to the implementation by the Borrower of a cash
management system and the Agent shall have received deposit account control
agreements with respect to the Operating Accounts and all other Accounts
(including without limitation accounts held with Xxxxx Fargo Bank, N.A. and The
Bank Of New York) other than Accounts that constitute Excluded Assets in form
and substance reasonably satisfactory to the Agent and substantially in the form
of Exhibit T.
(g) Required Approvals. The Required Term Loan A Lenders shall have
received evidence reasonably satisfactory to the Required Term Loan A Lenders of
all consents or approvals of any Governmental Authority or other Person which
the Required Term Loan A Lenders reasonably determine are required in connection
with the transactions contemplated by this Agreement, including all approvals,
expiration of all waiting periods under the Xxxx-Xxxxx-Xxxxxx Anti-Trust
Improvement Act and all other applicable law, except those consents and
approvals the failure of which to obtain would not result in a Material Adverse
Effect as reasonably determined by the Agent.
(h) Gaming Authorization. The Required Term Loan A Lenders shall be
satisfied that all Gaming Licenses or other authorizations by any Gaming
Authority, if any, required or desirable in connection with (i) the acquisition
and operation of the Premises, and (ii) the execution, delivery and performance
of this Agreement, the other Loan Documents and the Liens and security interests
granted pursuant hereto and thereto, have been obtained and are in full force
and effect; provided that, so long as Aladdin fulfills its conditions precedent
under the Purchase and Sale Agreement (or any such conditions are waived by the
Borrower), the Closing Date shall have occurred on or before the third day after
the last day of the calendar month in which all such Gaming Licenses and other
authorizations by any Gaming Authority shall have been obtained (with the
Closing Date deemed to have occurred as of the last day of the
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calendar month of such approval).
(i) Representations and Warranties, Etc. As of the Closing Date: (i)
the representations and warranties of the Borrower and the other Loan Parties
contained herein and in the other Loan Documents shall be true and correct in
all material respects as of the Closing Date, except those representations and
warranties made as of a specified date, which shall be true and correct in all
material respects as of such specified date; (ii) no Event or Event of Default
shall have occurred and be continuing; and (iii) the Agent shall have received a
certificate to such effect from an Approved Officer of the Borrower (the
"Borrower Certificate"). On the Closing Date, the Borrower shall have delivered
to the Agent the Representation and Warranty Certificate, together with the
Disclosure Schedule.
(j) No Material Adverse Change. No event has occurred or condition
exists which has had a Material Adverse Effect since December 31, 2003.
(k) Proceedings. All proceedings to be taken in connection with the
transactions contemplated by this Agreement, and all documents contemplated in
connection herewith, shall be reasonably satisfactory in form and substance to
the Agent, the Borrower and their respective counsel.
(l) Title Policy. The Agent shall have received the Title Insurance
Policy, or the Title Insurance Commitment whereby the Title Company
unconditionally commits to issue the Title Policy, all in form and substance
reasonably satisfactory to the Agent.
(m) Survey. The Agent shall have received the Survey.
(n) Lien Searches. The Agent shall have received the results of a
recent lien search in each of the jurisdictions where any real property of any
of the Loan Parties is located and where each Loan Party is organized, and such
search shall reveal no liens on any of the assets of such Persons except for (i)
Permitted Liens and (ii) liens to be discharged or assigned to the Agent on or
prior to the Closing Date pursuant to the Confirmation Order and documentation
reasonably satisfactory to the Agent. The Agent shall also have received the
results of a recent lien search in the jurisdictions where each of PHI, PHMemo
and PHIV are organized.
(o) Insurance. The Agent shall have received the (i) certificates of
insurance (in form commonly used within the industry) and (ii) Environmental
Insurance (in the event no Environmental Indemnity is provided) and in each case
determined such insurance coverage to be reasonably acceptable in form and
substance.
(p) Filings, Registrations and Recordings. Each document (including,
without limitation, any Financing Statements) required by the Security Documents
or under law or reasonably requested by the Agent to be filed, registered or
recorded in order to create in favor of the Agent, for the benefit of the
Secured Parties, a perfected Lien on the Collateral described therein
(including, without limitation with respect to the "The Marks", "Domain Names"
and "The Memo", each as defined in the License Agreement), prior and superior in
right to any other
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Person (other than the holders of Permitted Liens), shall be in proper form for
filing, registration or recordation.
(q) Organizational Documents, Etc. The Agent shall have received
such documents and certificates as it or its counsel may reasonably request
relating to the organization, existence and good standing of each Loan Party,
EquityCo and BH/RE, the authorization of this Agreement, the other Loan
Documents and the Warrants, as the case may be, in form and substance reasonably
satisfactory to the Agent (which shall provide for a representative of the
Lenders having a seat on the board of directors or managers of the Borrower or
in the event there is no such board of directors or managers, the representative
of the Lenders shall have a comparable advisory position). The Agent shall have
received a certificate of an Approved Officer of (or on behalf of) each Loan
Party, EquityCo and BH/RE dated the Closing Date and certifying (A) that
attached thereto is a true and complete copy of the operating agreement (or
other analogous governing document) of such Person as in effect on the Closing
Date, (B) that attached thereto is a true and complete copy of resolutions duly
adopted by the members or Board of Managers (or, if applicable, other analogous
governing body) of (or on behalf of) such Person authorizing the execution,
delivery and performance of the Loan Documents to which such Person is a party,
or the Warrants, and, in the case of the Borrower, the borrowings hereunder, and
that such resolutions have not been modified, rescinded or amended and are in
full force and effect, (C) that the articles of organization (or other analogous
organizational document) of such Person have not been amended since the date of
the last amendment thereto shown on the certificate of good standing furnished
pursuant to clause (i) above, and (D) as to the incumbency and signature of each
Approved Officer of such Person executing any other document delivered in
connection herewith on behalf of such Person, as the case may be; (iii) a
certificate of another Approved Officer as to the incumbency and specimen
signature of Person executing such certificate. The Agent shall have also
received resolutions duly authorized by the board of directors of each of PHI,
PHIV and PHMemo authorizing the execution, delivery and performance of the
Planet Hollywood Security Agreement and the License Subordination Agreement.
(r) Purchase and Sale Documents and Closing of Acquisition. The
Agent shall have (i) received duly executed copies of the Purchase and Sale
Agreement and all documents and instruments executed in connection therewith and
the Required Lenders shall be reasonably satisfied with the terms and provisions
thereof and (ii) determined that the Borrower shall have acquired good and
marketable fee title to the Premises.
(s) Manager, Management Agreement, Manager Subordination Agreement
and CEO. The Agent shall have (A)(i) received a copy of the duly executed
Management Agreement and any amendments thereto and all documents and
instruments executed in connection therewith, which shall be the same as the
agreement previously approved under the applicable Consent-2003 (subject to
ministerial type changes such as the corrections of typographical errors) or
otherwise in form and substance reasonably satisfactory to the Agent (acting at
the direction of the Required Lenders), (ii) received a copy of the duly
executed Manager Subordination Agreement which shall be the same as the
agreement previously approved under the Consent-2003 (subject to ministerial
type changes such as the corrections of
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typographical errors) or otherwise in form and substance reasonably satisfactory
to the Agent (acting at the direction of the Required Lenders) and such
assignments, documents and instruments reasonably requested by the Agent in
connection therewith, in form and substance reasonably satisfactory to the Agent
(acting at the direction of the Required Lenders), and (iii) a certificate from
an Approved Officer of the Borrower certifying that other than the amendment to
the Management Agreement referred to in clause (i) above there have been no
other changes to any of the above referenced documents from the executed
documents previously delivered to the Agent and (B) approved any casino operator
and the Chief Executive Officer of the Borrower and shall have received copies
of any duly executed agreements (and amendments thereto) relating to the
employment or retention of each such Person which shall be the same as the
agreement previously approved under the Consent-2003 (subject to ministerial
type changes such as the corrections of typographical errors) or otherwise in
form and substance reasonably satisfactory to the Agent (acting at the direction
of the Required Lenders), and shall have received such assignments, documents
and instruments reasonably requested by the Agent in connection therewith
(including a certificate from an Approved Officer of the Borrower certifying
that there have been no changes to the executed employment agreement for the CEO
of the Borrower dated April 11, 2003 other than the July 13, 2004 letter
agreement among such chief executive officer, the Borrower and Holdings
regarding certain options to purchase units representing membership interests of
Holdings).
(t) License Agreement; Planet Hollywood Security Agreement, etc. The
Agent shall have received (i) a copy of the duly executed License Agreement
(which shall contain, inter alia, a provision relating to the closing of the
existing Planet Hollywood restaurant located at 0000 Xxx Xxxxx Xxxxxxxxx Xxxxx,
No G-25 89109 in Las Vegas, Nevada) which shall be the same as the agreement
previously approved under the Consent-2004 (subject to ministerial type changes
such as the corrections of typographical errors) or otherwise in form and
substance reasonably satisfactory to the Agent (acting at the direction of the
Required Lenders), (ii) a duly executed License Subordination Agreement which
shall be the same as the agreement previously approved under the Consent-2003
(subject to ministerial type changes such as the corrections of typographical
errors) or otherwise in form and substance reasonably satisfactory to the Agent
(acting at the direction of the Required Lenders) and such other assignments,
documents and instruments reasonably requested by the Agent in connection
therewith and the Required Lenders shall have approved the terms and provisions
thereof, which approval shall not be unreasonably withheld or delayed, (iii) a
copy of the duly executed the Restaurant License Agreement (the "Restaurant
License Agreement") among the Borrower, PHI and PHIV which shall be the same as
the agreement previously approved under the Consent-2003 (subject to ministerial
type changes such as the corrections of typographical errors) or otherwise in
form and substance reasonably satisfactory to the Agent (acting at the direction
of the Required Lenders); (iv) the duly executed Planet Hollywood Security
Agreement; provided, however, that, if prior to the Closing Date, PHI segregates
"The Marks" relating to the name "Planet Hollywood" in a manner reasonably
satisfactory to the Required Lenders so that "The Marks" that will apply to the
Premises and the Business are separate and distinct from marks that apply to
other uses, the Lien on "The Marks" shall only be granted on those that will
apply to the Premises and the Business and, as a consequence, no license back by
the Agent shall be required in the event of a foreclosure; (v) a duly executed
intercreditor agreement between any Person (including without
61
limitation, Bay Harbour Management, L.C., Lauren Investments Holdings and South
Trust Bank, N.A.) having a Lien on "The Marks", "Domain Names" and "The Memo" of
PHI, PHMemo or PHIV referred to in the Planet Hollywood Security Agreement and
the Agent and the Required Lenders shall have approved the terms and provisions
of such agreement, which approval shall not be unreasonably withheld or delayed;
and (vi) if applicable, a certificate from an Approved Officer of the Borrower
certifying that there have been no changes to any of the documents refereed to
in clauses (i)-(v) above from those previously delivered to the Agent (other
than ministerial type changes).
(u) Investor Group. The Required Lenders shall be satisfied with the
members of the Investor Group (it being agreed that if the Xxxx Investor, any
Hotel Investor and the Bay Harbour Investor collectively constitute all members
of the Investor Group on the Closing Date, the Lenders shall be deemed to be
satisfied with the members of the Investor Group on the Closing Date); provided,
that each of the Xxxx Investor, any Hotel Investor and the Bay Harbour Investor
may add additional investors to the Investor Group prior to the Closing Date if
(i) doing so shall not result in a Change of Control, (ii) by no later than 45
days after the date of the entry of the Confirmation Order, such additional
investors shall have filed all required applications with the Gaming Authorities
and (iii) the Required Lenders shall have determined in their reasonable
discretion that any such additional investors shall provide a strategic benefit
to the Borrower.
(v) Warrants. The Agent shall have received for the ratable benefit
of the Lenders warrants to purchase 2.5% of the outstanding Equity Interests as
of the Closing Date of EquityCo at a price equal to the price paid by the
principals of EquityCo (the "Warrants") and the Agent shall be satisfied with
the terms and conditions of such warrants.
(w) Aladdin Working Capital and Cash Transfer. The Agent shall have
received evidence satisfactory to it that Aladdin shall have transferred an
amount equal to $15,000,000 of working capital (including $10,000,000 of cash)
to the Borrower.
(x) Payment of $14,000,000. The Agent shall have received payment in
full from the Borrower in cash of $14,000,000, in connection with the
Disposition of the Time Share Premises, to be distributed pro rata to all of the
Term Loan A Lenders other than the FF&E Lender as set forth in Section 4.3(d).
(y) Xxxxxxx Money Deposit. The Agent shall be satisfied that (i) the
Xxxxxxx Money Deposit (as defined in the Purchase and Sale Agreement) shall have
been received by the Borrower pursuant to the Purchase and Sale Agreement and
the Escrow Agreement (as such term is defined in the Purchase and Sale
Agreement) and shall have been retained by the Borrower.
(z) New Equity. The Agent shall have received evidence satisfactory
to it that (i) the amount of funds deposited into the Renovation Capital
Expenditure Account, plus (ii) the face amount of all Letters of Credit issued
on or before the Closing Date, plus (iii) the amount of funds deposited in the
Theater Renovation Account equals $90,000,000 in the aggregate. The amount of
the Xxxxxxx Money Deposit shall not be applied as a credit against, and shall
not
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otherwise reduce, the obligations of the Borrower to make the $90,000,000 of
deposits and /or issuances of Letters of Credit referred to in the first
sentence of this Section 5.1(z).
(aa) Operating Agreements, Estoppels and Subordination Agreements.
The Agent shall have approved all Operating Agreements and Leases, and to the
extent the Agent is not reasonably satisfied with the Final Order, and provided
that the Agent shall have delivered to the Borrower on or before the 65th day
prior to the anticipated Closing Date a notice requesting the same, shall have
received (i) estoppel certificates with respect to each of the Leases and
Operating Agreements and (ii) subordination agreements for each of the Leases,
all in form and content reasonably acceptable to the Agent, such approval not to
be unreasonably withheld or delayed.
(bb) Mezzanine Loan. The Agent and the Lenders shall have on or
before the 15th day prior to the Closing Date, (i) received the duly executed
Mezzanine Loan Agreement, which shall be the same as the agreement previously
approved under the Consent-2004 or otherwise in form and substance reasonably
satisfactory to the Agent (acting at the direction of the Required Lenders) and
(ii) received a duly executed (by all parties thereto other than the Agent) copy
of the Mezzanine Intercreditor Agreement, substantially in the form of Exhibit R
attached hereto and the other Mezzanine Loan Documents and determined that such
agreements are the same as the agreement previously approved under the
Consent-2004.
(cc) Matters Relating to the Theater Renovation Account. The Agent
shall receive an agreement (in form and substance reasonably satisfactory to it)
duly executed by the parties to the Mezzanine Escrow Agreement that provides,
inter alia, that the Agent has the right to direct payment of funds in the
Theater Renovation Account in the event (i) that the Borrower fails to comply
with Section 4.3(b) hereof and/or (ii) of an Event of Default.
(dd) CFO of Borrower. The Agent shall have received evidence
reasonably satisfactory to it that the Borrower has hired a Chief Financial
Officer of the Borrower reasonably satisfactory to the Required Lenders for a
term commencing no later than the Closing Date. The Agent and the Required
Lenders agree that Xxxxx Xxxxxxx is a reasonably satisfactory candidate for
Chief Financial Officer.
(ee) Notice of Effective Date. The Agent shall have received and be
satisfied in its reasonable discretion with a copy of the Notice of the
Effective Date delivered to the Bankruptcy Court.
5.2 Borrower Condition Precedent. The Borrower will be obligated to incur
the Debt evidenced by the Term Loans, on the Closing Date, if the following
conditions precedent have been satisfied or waived by the Borrower before the
Closing Date as determined by the Borrower in its reasonable discretion: The
transactions contemplated to occur pursuant to the Purchase and Sale Agreement
shall have occurred on or before the Closing Date.
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ARTICLE 6
GENERAL WARRANTIES AND REPRESENTATIONS
The Borrower warrants and represents to the Agent and each Lender that,
except as hereafter disclosed to and accepted by the Agent acting upon the
reasonable direction of the Required Lenders in writing or as otherwise provided
herein:
6.1 Authorization, Validity, and Enforceability of this Agreement and the
Loan Documents. The Borrower has the requisite limited liability company power
and authority to execute, deliver, and perform this Agreement and the other Loan
Documents, to incur the Obligations, and to grant the Security Interest. The
Borrower has taken all necessary limited liability company action (including,
without limitation, obtaining any required approval of its equity holders) to
authorize its execution, delivery, and performance of this Agreement and the
other Loan Documents. No consent, approval, or authorization of, or filing with,
any Governmental Authority, and no consent of any other Person, is required in
connection with the Borrower's execution, delivery, and performance of this
Agreement and the other Loan Documents, except for those described on Schedule
6.1 hereto, those already duly obtained and except where the failure to obtain
such consent, approval, authorization or filing will not have a Material Adverse
Effect. This Agreement has been, and as of the Closing Date the other Loan
Documents will be duly executed and delivered by the Borrower, and constitute or
will constitute the legal, valid, and binding obligation of the Borrower to the
extent party thereto, enforceable against the Borrower in accordance with their
respective terms without defense, setoff, or counterclaim. The Borrower's
execution, delivery, and performance of this Agreement does not, and the
Borrower's and its Subsidiaries' execution, delivery and performance of the
other Loan Documents will not conflict with, or constitute a violation or breach
of, or constitute a default under, or result in the creation or imposition of
any Lien upon the Property of the Borrower or any Subsidiary (except as
contemplated by this Agreement and the other Loan Documents) by reason of the
terms of (a) any mortgage, lease, agreement, or instrument to which the Borrower
or any Subsidiary is a party or which is binding upon it, except (i) for those
described on Schedule 6.1 hereto or (ii) where such conflict, violation or
default would not reasonably be expected to have a Material Adverse Effect (b)
any judgment, law, statute, rule or governmental regulation applicable to the
Borrower or any Subsidiary, except where such conflict, violation or default
would not reasonably be expected to have a Material Adverse Effect or (c)
Organizational Documents of the Borrower or any Subsidiary.
6.2 Organization and Qualification. The Borrower: (a) is duly formed and
organized and validly existing in good standing under the laws of the State of
Nevada; (b) has all requisite limited liability company power and authority to
conduct its business and to own its Property; and (c) is qualified to do
business as a foreign limited liability company and in good standing in Nevada
and any other state where the failure to so qualify would reasonably be expected
to have a Material Adverse Effect.
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6.3 Subsidiaries. As of the Closing Date, Schedule 6.3 is a correct and
complete list of the name and relationship to the Borrower of each and all of
the Borrower's Subsidiaries. Each Subsidiary is (a) duly formed and organized
and validly existing in good standing under the laws of its state of
incorporation or organization and (b) qualified to do business as a foreign
entity and in good standing in any state where the failure to so qualify would
reasonably be expected to have a Material Adverse Effect.
6.4 Financial Statements. Since the date of the latest Consolidated
financial statements of (i) BH/RE and its Subsidiaries and (ii) the Borrower and
its Subsidiaries delivered to the Agent, there has been no material adverse
change in the business, assets, liabilities, property, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole.
6.5 Capitalization. After giving effect to the Purchase and Sale
Agreement, on the Effective Date the capitalization of the Borrower is as set
forth on Schedule 6.5 hereto.
6.6 Solvency. On the Effective Date the Borrower is Solvent and possesses
adequate assets for the conduct of its business.
6.7 Restrictive Agreements. Other than as set forth on Schedule 6.7,
neither of the Borrower nor any of its Subsidiaries is a party to any agreement,
or subject to any corporate restriction, which affects the ability of the
Borrower or any other Loan Party to execute, deliver, and perform the Loan
Documents and repay the Obligations or which is reasonably likely to have a
Material Adverse Effect.
6.8 Regulations U and X. Neither the Borrower nor any of its Subsidiaries
owns any "margin stock" as such term is defined in Regulation U, as amended, of
the Board. The proceeds of the borrowings made pursuant to Article II will be
used by the Borrower only for working capital or other general business
purposes. None of such proceeds will be used, directly or indirectly, (i) for
the purpose of purchasing or carrying any margin stock or (ii) for the purpose
of reducing or retiring any Debt which was originally incurred to purchase or
carry margin stock or (iii) for any other purpose which might constitute any of
the Loans under this Agreement a "purpose credit" within the meaning of
Regulation U or X of the Board. Neither the Borrower nor its Subsidiaries has
taken or will take any action which might cause this Agreement or any of the
Loan Documents to violate any regulation of the Board or to violate the
Securities Exchange Act of 1934 or any state securities laws.
6.9 Broker's Fees. The Borrower and its Subsidiaries has not made any
commitment or taken any action which will result in a valid claim for any
brokers, finders or similar fees or commitments in respect to the transactions
described in this Agreement. The Borrower agrees to defend the Agent and each
Lender and save them harmless from all claims of any Person acting on behalf of
the Borrower for any such fees, and this indemnity shall include reasonable
attorneys' fees and legal expenses.
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6.10 Disclosure. To the Knowledge of the Borrower, neither this Agreement
nor any document or written statement (other than projections referred to in
Section 6.12 of this Agreement) furnished to the Agent or any Lender and
prepared by or on behalf of the Borrower hereunder contains any untrue statement
of a material fact or omits to state any material fact necessary in order to
make the statements contained herein or therein not misleading in any manner
that is reasonably likely to have a Material Adverse Effect.
6.11 Investment and Holding Company Status. Neither the Borrower nor any
of its Subsidiaries is (a) an "investment company" as defined in, or subject to
regulation under, the Investment Company Act of 1940 or (b) a "holding company"
as defined in, or subject to regulation under, the Public Utility Holding
Company Act of 1935 or (c) under any other federal or state statute or
regulation which may limit its ability to incur Debt, other than the Gaming Laws
or which may otherwise render all or any portion of the Obligations
unenforceable. The incurrence of the Obligations under the Loan Documents
complies with all applicable provisions of the Gaming Laws.
6.12 Projections. The Borrower has heretofore furnished to Xxxxxxx and
Marsal, Inc. ("A&M"), financial advisor to the Lenders, annual projected income
statements of the Borrower. The projections are based upon assumptions that
were, at the time made and at the time such projections were furnished to A&M,
believed by the Borrower to have been reasonable in light of the conditions
which existed at the time the projections were made and delivered to A&M. As of
the date made and furnished to A&M, the projections represented the Borrower's
good faith estimate of the projected results of operations of the Borrower,
provided that no representation is made that the projections will prove to be
correct.
6.13 Payments with respect to Time Share Premises. Neither the Borrower,
any Affiliate of the Borrower, any Affiliate of Holdings, the Investor Group or
any Affiliate of the Investor Group has entered into any agreement or
arrangement (other than Holdings solely in connection with its receipt of no
more than 50% of the Marketing Fees or as otherwise contemplated by the Time
Share Plan) that provides for any such Person (other than the Borrower) to
receive any payments of any nature or kind with respect to the Time Share
Premises other than those approved in writing by the Required Term Loan A
Lenders (other than the FF&E Lender).
ARTICLE 7
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that from and after the Closing Date and
so long as this Agreement is in effect and until the Commitments have terminated
and all Obligations (other than any indemnities which are not then due and
payable) are discharged in full:
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7.1 Books and Records. The Borrower will, and will cause its Subsidiaries
to: (a) maintain, at all times, correct and complete books, records and accounts
in which complete, correct and timely entries are made of its transactions in
accordance with GAAP; (b) reflect by means of appropriate entries in such
accounts and in all financial statements proper liabilities and reserves for all
taxes and proper provision for depreciation and amortization of Property and bad
debts, all in accordance with GAAP; (c) maintain at all times books and records
pertaining to the Collateral in such detail, form, and scope as the Agent
(acting upon the reasonable direction of the Required Term Loan A Lenders) shall
reasonably require, including without limitation, records of all dealings
affecting the Collateral; and (d) permit, upon reasonable prior notice to the
Authorized Officer of the Borrower and during normal business hours, officers
and designated representatives of the Agent or any Lender to visit and inspect
any of the properties or assets of the Borrower and any of its Subsidiaries and
to examine the books of account of the Borrower and any of its Subsidiaries and
to inspect or examine the items referred to in Section 7.18(c) and discuss the
affairs, finances and accounts of the Borrower and any of its Subsidiaries with,
and be advised as to the same by, the officers and independent accountants of
the Borrower or such Subsidiary, all at such reasonable times and intervals and
to such reasonable extent as the Agent or any such Lender may request.
7.2 Financial and Other Information. From and after the Closing Date, the
Borrower will, furnish to the Agent, with copies for each of the Lenders:
(a) within 120 days after the end of each Fiscal Year, commencing
with Fiscal Year 2004, (i) Consolidated balance sheets and Consolidated income
statements showing the financial condition of (x) BH/RE and its Subsidiaries and
(y) the Borrower and its Subsidiaries, in each case as of the close of such
Fiscal Year and the results of their operations during such year, and (ii) a
Consolidated statement of members' equity and a Consolidated statement of cash
flow, as of the close of such Fiscal Year, in each case of BH/RE and its
Subsidiaries and the Borrower and its Subsidiaries, all the foregoing financial
statements shall be audited by a Big 4 or other independent certified public
accountants reasonably acceptable to the Required Lenders, and to be in form and
substance reasonably acceptable to the Required Lenders;
(b) within 30 days after the end of each fiscal month unaudited
Consolidated income statements of (i) BH/RE and its Subsidiaries and (ii) the
Borrower and its Subsidiaries and within 60 days after the end of each Fiscal
Quarter unaudited Consolidated and consolidating balance sheets and Consolidated
and consolidating income statements showing the financial condition and results
of operations of the BH/RE and its Subsidiaries as of the end of each such
quarter, a Consolidated and consolidating statement of members' equity and a
Consolidated and consolidating statement of cash flow as of the end of each such
quarter, prepared and certified by an Approved Officer of the Borrower as
presenting fairly in all material respects the financial condition and results
of operations of the BH/RE and its Subsidiaries and as having been prepared in
accordance with GAAP consistently applied, setting forth in the case of each
consolidated statement in comparative form the corresponding figures for the
corresponding quarter of the preceding year and corresponding figures for the
period beginning with the first day of the current Fiscal Year and ending on the
last day of the relevant Fiscal Quarter and the corresponding period for the
previous Fiscal Year, in each case subject to footnotes and normal
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year-end audit adjustments;
(c) (i) promptly after the same become publicly available, copies of
such registration statements, annual, periodic and other reports, and such proxy
statements and other information, if any, as shall be filed by BH/RE or any
Subsidiary with the Securities and Exchange Commission pursuant to the
requirements of the Securities Act of 1933 or the Securities Exchange Act of
1934; (ii) as soon as practicable, copies of all material reports, forms,
filings and financial information submitted to any other Governmental Authority
and all material reports submitted to its interest holders; (iii) within 5
Business Days after receipt by the Borrower thereof, copies of any exception
reports prepared by any Gaming Authority and (iv) within 5 Business Days of
filing by the Borrower with any Gaming Authority, copies of any and all reports
of borrowings on form 8.130 or its equivalent;
(d) concurrently with any delivery under (a) or (b) (solely in the
case of quarterly deliveries) above, a certificate of the firm or Person
referred to therein (which certificate furnished by the independent public
accountants referred to in paragraph (a) above may be limited to accounting
matters and disclaim responsibility for legal interpretations and shall be in a
form to be reasonably agreed upon by the Borrower, such independent public
accountants and the Agent (acting at the reasonable direction of the Required
Lenders)) certifying that during their audit or preparation, as applicable, of
such financial statements nothing has come to its, his or her attention that
would result in an Event or Event of Default has occurred (including recognizing
(in the case of an audit performed by a Big 4 or other independent certified
public accountants reasonably acceptable to the Required Lenders), however, that
the scope and purpose of their audit was not to determine compliance with the
terms of this Agreement or whether an Event or Event of Default has otherwise
occurred); provided, however, that any certificate delivered concurrently with
(a) above shall be accompanied by a supplemental certificate confirming the
accuracy of the accountants' certificate (and shall in any event include
calculations demonstrating compliance with the financial covenants set forth
herein) and signed by an Approved Officer of the Borrower. The parties hereto
agree that in the case of any delivery under (b) above, a certificate from the
Chief Financial Officer or Chief Executive Officer of the Borrower shall satisfy
the requirements of this Section 7.2(d) with respect to the certification of
calculations demonstrating the Borrower's compliance, as of the date of the
financial statements being furnished, with the financial covenants set forth
herein or, in connection with the occurrence of an Event or Event of Default has
occurred, specifying the nature and extent thereof and any corrective action
taken or proposed to be taken with respect thereto;
(e) concurrently with any delivery under (a) or (b) (solely in the
case of quarterly deliveries) above, a management discussion and analysis
certified by an Approved Officer of the Borrower describing any differences
between the reported financial results under the financial statements delivered
thereunder from the budget required by Section 7.2(j) below, which shall
include, among any other information or explanation reasonably requested by the
Agent, (i) the calculation of EBITDA, the Annual Actual Amount of Interest, the
Annual Estimated Amount of Interest, the Shortfall Interest Amount or the Excess
Interest Amount, if any, and the Excess Cash Flow for the Fiscal Quarter last
ended, (ii) a list of any Capital Expenditures (including Renovation Capital
Expenditures and Maintenance Capital
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Expenditures) made during such Fiscal Quarter and shall set forth in connection
with any such Capital Expenditures made during such Fiscal Quarter, the amount
and nature of any such expenditure with attached copies of any contracts entered
into, invoices received and evidence of payment made with respect to any such
expenditure together with mechanic's liens releases in connection with any
payments made by the Borrower, and (iii) the Reserve Amount and the Operating
Cash Reserve Amount at such time and a schedule listing how any cash
constituting the Reserve Amount was spent;
(f) concurrently with any delivery under (b) (solely in the case of
quarterly deliveries) above, a certificate from an Approved Officer of the
Borrower demonstrating that the Borrower shall be in compliance with the minimum
EBITDA covenant in Section 8.13 for the four Fiscal Quarter period ending on the
immediately succeeding Fiscal Quarter. In addition, the Borrower shall test the
EBITDA covenant in Section 8.13 by making a good faith estimate of the EBITDA
for the immediately succeeding Fiscal Quarter and adding such number to the sum
of the EBITDA for the Fiscal Quarter last ended (the "Last Ended Fiscal
Quarter") and for the two Fiscal Quarters ending immediately prior to the Last
Ended Fiscal Quarter;
(g) concurrently with any delivery under (a) above, a management
letter prepared by the independent public accountants who reported on the
financial statements delivered under (a) above, with respect to the internal
audit and financial controls of the Borrower and its Subsidiaries;
(h) any gaming reports generated by the Borrower;
(i) within two Business Days after receipt of any response from
Boulevard Invest to the Borrower's Plan, a copy of such response (or a written
summary thereof in the event such response is not in writing) and immediately
when delivered to Boulevard Invest (but in no event later than 15 Business Days
after receipt of Boulevard Invest's response), the Borrower's counter response
and any proposed course of action with respect to making any Renovation Capital
Expenditures (it being agreed that any further responses from Boulevard Invest
shall be delivered to the Agent within two Business Days after receipt thereof
by the Borrower and the Borrower shall deliver its counter response(s) and any
proposed course(s) of action to Boulevard Invest and the Agent within 15
Business Days after its receipt of any response from Boulevard Invest);
(j) as soon as available, but in any event not later than December
31 of each Fiscal Year, the Borrower's annual internal operating budget (which
shall list with reasonable specificity the Borrower's good faith estimate of
planned Renovation Capital Expenditures through the third Anniversary Date,
Maintenance Capital Expenditures, and other Capital Expenditures) for the next
Fiscal Year, and as soon as prepared and available any amendments thereof
prepared in the ordinary course;
(k) as soon as available, but in any event not later than December
31 of each Fiscal Year, a Consolidated and consolidating plan and financial
forecast for the next Fiscal Year and each subsequent Fiscal Year through the
Maturity Date, including (a) forecasted
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Consolidated and consolidating balance sheets and forecasted Consolidated and
consolidating statements of income and cash flows of the Borrower and its
Subsidiaries for such Fiscal Years, together with an explanation of the
assumptions on which such forecasts are based and (b) such other information and
projections for such Fiscal Years as the Agent may reasonably request;
(l) as soon as available, but in any event not later than 30
calendar days following the end of each fiscal month, a monthly operating report
for the month then ended which shall include items used by the Borrower in
measuring its operating and financial performance in the ordinary course which
shall include, without limitation, the average daily room rate, food and
beverage revenue per room, gaming revenue and the other items set forth on
Exhibit J or as may otherwise be prepared by the Borrower in the ordinary course
of its management and financial reporting so long as any such items are
acceptable to the Agent (acting upon the reasonable direction of the Required
Lenders), together with such other information reasonably requested by Agent or
any Lender;
(m) promptly upon receipt thereof, copies of all material notices,
reports, budgets, forecasts, proposals, studies, financial statements and other
information provided by any Manager, any casino operator or any Leasing Manager;
(n) at the Agent's request, a copy of each annual report or other
filing filed with respect to each Plan of the Borrower or any ERISA Affiliate;
(o) promptly upon the earlier of preparation or receipt thereof,
copies of any proposed agreements and Plans and Specifications with respect to
the Time Share Premises so that the Agent (acting at the reasonable direction of
the Required Term Loan A Lenders (other than the FF&E Lender) may determine that
(i) any of the foregoing agreements are reasonably satisfactory to the Required
Term Loan A Lenders (other than the FF&E Lender) and (ii) the Plans and
Specifications substantially conform to any such approved agreements and
thereafter provide copies of any such executed agreements;
(p) promptly after the sending thereof, any notices, reports,
budgets, forecasts, proposals, studies, financial statements, document or other
material information provided by Holdings or any Affiliate thereof to the
Mezzanine Lender;
(q) at the Agent's reasonable request (and to be provided no more
frequently than once a month so long as there is no continuing Event of
Default), a true, correct and complete statement of the outstanding indebtedness
in respect of the Mezzanine Loan; and
(r) such additional information as the Agent may from time to time
reasonably request, or which the Agent shall reasonably request upon the
reasonable request of any Lender, regarding the financial and business affairs,
operations or prospects of the Borrower and its Subsidiaries.
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7.3 Notices to the Agent. In addition to any other notices required
hereunder, the Borrower shall notify the Agent in writing of the following
matters at the following times:
(a) Immediately after becoming aware of the existence of any Event
or Event of Default.
(b) Immediately after becoming aware that (i) any Manager has
terminated a Management Agreement or otherwise ceased acting as Manager, or (ii)
any Leasing Manager has terminated a Leasing Services Agreement, or has
otherwise ceased managing such portions of the Premises or (iii) the License
Agreement has been terminated.
(c) Immediately after becoming aware of the (i) existence of any
"Default" or "Event of Default" (each as defined in the Mezzanine Loan
Agreement) under the Mezzanine Loan Agreement or any other Mezzanine Loan
Document, (ii) amendment, modification, alteration or change of any term in the
Mezzanine Loan Documents (and shall concurrently therewith provide the Agent
with an executed copy of any such amendment, modification, alteration or change)
(iii) exercise, cancellation, conversion, redemption, or repurchase of any of
the Warrants (as defined in the Mezzanine Loan Agreement) issued to the
Mezzanine Lender pursuant to the Mezzanine Loan Agreement or the issuance of any
additional warrants to the Mezzanine Lender or (iii) any claims made or adverse
occurrence pertaining to the indebtedness with respect to the Mezzanine Loan.
(d) Promptly after receiving notice (but in no event later than five
days after the earlier of (i) receiving such notice or (ii) the occurrence of
any such change) of a change in the composition of the members or other equity
holders of the Investor Group.
(e) Promptly after receiving notice (but in no event later than five
days after the earlier of (i) receiving such notice or (ii) the occurrence of
any such change) of any change in the composition of the board of directors or
other governing body that manages the operations of the Borrower.
(f) Within five Business Days after becoming aware of:
(i) any material adverse change in the Property, business,
operations, or condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole (including, without
limitation any Casualty Event);
(ii) any pending or threatened action, proceeding, or
counterclaim by any Person, or any pending or threatened investigation by
a Governmental Authority, which is reasonably likely to have a Material
Adverse Effect;
(iii) any pending or threatened strike, work stoppage,
material unfair labor practice claim, or other material labor dispute
which is reasonably likely to have a Material Adverse Effect;
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(iv) any violation of any law, statute, regulation, or
ordinance of a Governmental Authority applicable to the Borrower or any
Subsidiary, which is reasonably likely to have a Material Adverse Effect;
and
(v) the fact that the Borrower or any Subsidiary has
materially violated any Environmental Laws or that its compliance is being
investigated in respect of an alleged material failure to comply with any
Environmental Law.
(g) Not less than thirty (30) days prior to the Borrower changing
its name or the location of its chief executive office or its jurisdiction of
organization or formation.
(h) Not more than thirty (30) days after the end of each quarter:
(i) the execution of a definitive lease or sublease of real property by the
Borrower; (ii) the termination of a lease or sublease of real property to which
the Borrower is a party; (iii) the opening or closing of a place of business
owned or operated by the Borrower; unless prior notice of any such event is
required by another provision of this Section 7.3, in each case effected during
the prior month; (iv) any Casualty Event involving a loss of Property having a
Fair Market Value of $1,500,000 or more and the extent to which such occurrence
is covered by insurance; and (vi) the amount of any Reinvestment Amount
reinvested in such month.
(i) Within five (5) days of the Borrower's receipt or giving of
same, a copy of any written notice under, pursuant to or in connection with any
Lease or Material Operating Agreement, (i) alleging a default by the Borrower or
Lessee or any other Persons thereunder, (ii) setting forth a claim against the
Borrower or any Manager in an amount greater than $1,500,000 or (iii) exercising
a renewal, extension, expansion or termination option thereunder.
(j) Promptly upon receipt of same by the Borrower, a copy of any
written notice or other written instrument which might materially adversely
affect the Premises, the Liens securing the Obligations or the Agent's or any
Lender's rights and remedies under or with respect to any Loan Document,
including any written notice from a Governmental Authority concerning any tax or
special assessment, or any written notice of any change in or alleged violation
of any zoning ordinance, Permitted Lien, fire ordinance, building code
provision, or other Legal Requirement affecting the Premises.
(k) Not more than thirty (30) days after the end of each quarter:
Permitted Liens described in clauses (a)(ii), (e) and (i) of the definition
thereof which are created during such quarter.
(l) Within 30 days after the end of each quarter, any sales and
other Dispositions of Property permitted by Section 8.1, consummated during such
quarterly period.
(m) Three Business Days prior to entering into any merger permitted
under Section 8.1(b).
(n) Concurrently with the delivery of any notice relating to the use
of funds (or proposed use of funds) in the Theater Renovation Account to the
escrow agent or the Mezzanine
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Lenders under the Mezzanine Escrow Agreement.
Each notice given under this Section shall describe the subject matter thereof
in reasonable detail and shall set forth the action that the Borrower has taken
or proposes to take with respect thereto.
7.4 Taxes and Other Obligations. The Borrower will, and will cause its
Subsidiaries to: (a) file when due all tax returns and other reports which it is
required to file, pay when due all Taxes against it or upon its Property,
income, and franchises, make all required withholding and other tax deposits,
and establish adequate reserves for the payment of all such items, and shall
provide to the Agent, upon request, reasonably satisfactory evidence of its
timely compliance with the foregoing, except in each case where the failure to
comply would not reasonably be expected to have a Material Adverse Effect; (b)
pay when due all Debt owed by it and perform and discharge in a timely manner
all other obligations undertaken by it, except where the failure to do so would
not reasonably be expected to have a Material Adverse Effect; (c) duly and
promptly comply with the terms and provisions of each judgment, law, statute,
rule, and governmental regulation applicable to it and each contract, mortgage,
lien, lease, indenture, order, instrument, agreement, or document to which it is
a party or by which it is bound, except in each case where the failure to comply
would not reasonably be expected to have a Material Adverse Effect, and (d) duly
and promptly comply, in all material respects, with the provisions of, and
enforce all of its rights under, all Material Operating Agreements, except to
the extent that the failure to so comply or enforce the foregoing is not
reasonably likely to have a Material Adverse Effect; provided, however, that the
Borrower or Subsidiary shall not be required to pay any Tax or Debt, or perform
or discharge any other obligation, that it is contesting in good faith by
appropriate proceedings diligently pursued, and it has established and maintains
adequate reserves (in the good faith judgment of the management of such Person)
with respect thereto in accordance with GAAP.
7.5 Existence, Good Standing and Legal Requirements. (a) The Borrower
will, and will cause its Subsidiaries to, maintain its corporate or limited
liability company, as applicable, existence and its qualification and good
standing in Nevada and all other states necessary to conduct its business and
own its Property, and shall obtain and take all actions which may be required to
preserve, renew and extend Permits (including, without limitation, any Permits
or authorizations relating to the sale of alcohol), franchises and governmental
authorizations necessary to conduct its business and own its Property and to
operate and maintain the Premises in accordance with the Loan Documents, the
Management Agreement (if any), the Leasing Services Agreement (if any), and any
other Material Operating Agreements, in each case except to the extent, other
than with respect to corporate or limited liability company, as applicable,
existence, that the failure to maintain the foregoing is not reasonably likely
to have a Material Adverse Effect. The Borrower shall comply with all laws,
rules, regulations and governmental orders (whether Federal, state or local)
(including, without limitation, all Gaming Laws) applicable to the operation of
such businesses whether now in effect or hereafter enacted (including, without
limitation, all applicable laws, rules, regulations and governmental orders
promulgated by any Gaming Authority and all those relating to public and
employee health and safety and all Environmental Laws) and with any and all
other applicable laws, rules, regulations and governmental orders, except to the
extent where such noncompliance is not reasonably likely
73
to have a Material Adverse Effect.
(b) The Borrower shall have the right, in good faith, to contest by
appropriate legal proceedings, after notice to the Agent, but without cost or
expense to the Agent or the Lenders, the validity of any Legal Requirement and
to postpone the compliance therewith, provided that (i) such contest shall
operate to prevent the enforcement thereof, (ii) such contest shall be promptly
and diligently prosecuted by and at the expense of the Borrower, (iii) none of
the Borrower, the Agent nor the Lenders shall suffer or would be the subject of
any civil or criminal liabilities, penalties or sanctions, (iv) the Borrower
shall comply with such contested Legal Requirement if at any time all or any
part of the Premises shall be in danger of being foreclosed, sold, forfeited, or
otherwise lost or materially impaired or if such contest shall be discontinued,
(v) the Borrower shall agree to indemnify and hold harmless the Agent and the
Lenders from and against any liability and claims arising out of the
postponement of the compliance with such Legal Requirement, and (vi) the
Borrower shall, prior to commencing any such proceedings, furnish proof
reasonably satisfactory to the Agent that it has established a reserve account
or provided collateral reasonably acceptable to the Agent in which the Agent and
the Lenders shall have a security interest and which reserve or collateral, as
the case may be, shall be in an amount not less than the amount of any
penalties, including interest and additional charges which may be incurred as a
result of such contest or has otherwise, to the reasonable satisfaction of the
Agent, provided for the payment of such amounts.
7.6 Insurance. (a) The Borrower shall maintain, or cause to be maintained
insurance as evidenced by the Insurance Policies set forth in Section U of the
Disclosure Schedule (which shall include terrorism insurance), and shall deliver
or cause to be delivered to the Agent, (i) contemporaneously with the execution
hereof, the certificates of insurance evidencing the Insurance Policies and (ii)
all renewal certificates of insurance, at least thirty (30) days before the
expiration date of each expiring Insurance Policy if available and commercially
reasonable or otherwise as soon as practicable and within ten (10) days after
such renewal, upon the Agent's request, the Borrower shall deliver to the Agent
evidence satisfactory to the Agent of the Borrower's payment of the premium for
such Insurance Policy.
(b) All Insurance Policies shall be issued by an insurer or insurers
reasonably acceptable to the Agent with an A.M. Best rating and size of A- VIII
or better or otherwise acceptable to the Agent, or equivalent rating from
another agency acceptable to the Agent and be licensed in the state of Nevada.
The property, boiler and machinery Insurance Policies shall also name the Agent
under a non-contributing Nevada standard mortgagee clause or an equivalent
endorsement on a standard form or such other form as may be reasonably
satisfactory to the Agent in form and content. Loss of rental income insurance
shall name the Agent as loss payee. All property Insurance Policies also shall
contain an agreed amount (coinsurance waiver) and replacement cost value
endorsement and shall cover, without limitation, all tenant improvements and
betterments which the Borrower is required to insure in accordance with any
Lease or any Material Operating Agreement. The insurance policy shall be
endorsed to also provide building replacement cost. The amount of any deductible
under any Insurance Policy must be reasonably acceptable to the Agent. Without
the Agent's prior written consent, the Borrower shall not name any Person other
than the Agent, as loss payee under any property Insurance Policies covering the
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Improvements and such tenant improvements and betterments that the Borrower is
required to insure pursuant to this Agreement; provided that, if blanket
policies are obtained, this sentence shall not apply to property covered by such
blanket policies other than the Improvements and such tenant improvements and
betterments which the Borrower is required to insure pursuant to this Agreement.
Notwithstanding the immediately preceding sentence but subject to the terms and
conditions of Section 7.19 of this Agreement, such Insurance Policy shall
provide that any proceeds that are payable to a loss payee shall be payable to
the Agent only and requiring the endorsement of the Agent only.
(c) The Borrower hereby agrees that it shall not (x) cancel or
terminate any Insurance Policy, (y) modify the provisions of any Insurance
Policy relating to the coverage, deductibles and limits, or (z) modify the
provision of any Insurance Policy not relating to coverage, deductibles or
limits if, after giving effect to such modification, such policy would no longer
satisfy the requirements of this Agreement. Each Insurance Policy shall contain
a provision whereby the insurer (i) waives any right to claim any premiums and
commissions against the Agent provided that such policy need not waive the
requirement that the premium be paid in order for a claim to be paid to the
insured, and (ii) provides that the Agent is permitted, but not obligated, to
make payments to effect the continuation of such policy upon notice of
cancellation due to nonpayment of premiums. In the event any Insurance Policy
(except for fidelity, general public and other liability and workers'
compensation insurance) shall contain breach of warranty provisions, such policy
shall provide, to the fullest extent allowable under such policy, that with
respect to the interest of the Agent, such Insurance Policy shall not be
invalidated by and shall insure the Agent regardless of (A) any act, failure to
act or negligence of or violation of warranties, declarations or conditions
contained in such policy by any named insured, (B) the occupancy or use of the
Premises for purposes more hazardous than permitted by the term thereof, or (C)
any foreclosure or other action or proceeding taken by the Agent pursuant to any
provision of the Mortgage.
(d) The Borrower shall pay the premiums for the Insurance Policies
as the same become due and payable. The Borrower shall deliver to the Agent
certificates of insurance. The Borrower also shall deliver to the Agent, within
ten (10) days of Agent's request, a certificate of the Borrower or the
Borrower's insurance agent setting forth the particulars as to all such
Insurance Policies, that all premiums due thereon have been paid and that the
same are in full force and effect. Not later than thirty (30) days prior to the
expiration date of each of the Insurance Policies, if available and commercially
reasonable or otherwise as soon as practicable, the Borrower shall deliver to
the Agent a certificate of insurance evidencing renewal of coverage as required
herein. Not later than sixty (60) days after the renewal of each of the
insurance policies, the Borrower shall deliver to the Agent certificates of
insurance. Within ten (10) days after such renewal, if requested by the Agent,
the Borrower shall deliver to the Agent evidence of payment of premium
reasonably satisfactory to the Agent.
(e) Notwithstanding anything to the contrary contained herein, if at
any time the Agent is not in receipt of written evidence that all insurance
policies required hereunder is maintained in full force and effect, the Agent
shall have the right (but not the obligation), upon five (5) Business Days prior
notice to the Borrower, to take such action as the Agent deems
75
necessary in its reasonable discretion to protect its interest in the Premises,
including, without limitation, the obtaining of such insurance policies as the
Agent shall deem appropriate, and all reasonable expenses incurred by the Agent
in connection with such action shall be paid by the Borrower.
(f) Any insurance maintained pursuant to this section may be
evidenced by blanket insurance policies covering the Premises and other
properties or assets of the Borrower or its affiliates, provided that any such
policy shall in all other respects comply with the requirements of this Section
and are otherwise reasonably approved by the Agent and its insurance consultant.
Agent shall reasonably determine whether such blanket policies shall provide
sufficient limits of insurance.
(g) The Insurance Policies set forth on Section U of the Disclosure
Schedule shall not be changed without the reasonable prior written consent of
the Agent (which consent shall not be unreasonably withheld or delayed).
7.7 Environmental Laws. The Borrower will, and will cause its Subsidiaries
to: (a) conduct its business in full compliance with all Environmental Laws
applicable to it (including, without limitation, those relating to such Person's
generation, handling, use, storage, and disposal of Hazardous Materials), except
where non-compliance is not reasonably likely to have a Material Adverse Effect;
(b) notify the Agent of any Environmental Claim, or event or circumstance on the
basis of which an Environmental Claim involving material liability could
reasonably be expected to be made, in each case which is reasonably likely to
have a Material Adverse Effect upon becoming aware thereof; (c) take prompt and
appropriate action to respond to any Environmental Claim, and regularly report
to the Agent on such response with respect to any Environmental Claim which
would reasonably be expected to have a Material Adverse Effect; and (d) pay when
due all fines and penalties assessed against them for violations of
Environmental Laws, except any such fine or penalty that it is contesting in
good faith by appropriate proceedings diligently pursued or which is not
reasonably likely to have a Material Adverse Effect. Without limiting the
generality of the foregoing, whenever (A) Agent reasonably believes that there
may be non-compliance by the Borrower or a Subsidiary with any Environmental
Law, which is reasonably likely to have a Material Adverse Effect (B) required
by applicable law, and (C) any time during the continuance of an Event or Event
of Default, the Borrower shall, at the Agent's reasonable request (acting upon
the reasonable direction of the Required Term Loan A Lenders) and at the
Borrower's reasonable expense: (a) cause an independent environmental engineer
reasonably acceptable to the Agent to conduct such tests of the Premises and
prepare and deliver to the Agent and the Borrower, with a copy for each Lender,
a report setting forth the results of such tests, a proposed plan for responding
to any environmental problems described therein, and an estimate of the costs
thereof; and (b) provide to the Agent, with a copy for each Lender, a
supplemental report of such engineer whenever the scope of the environmental
problems, or the response thereto or the estimated costs thereof, shall change.
If the Borrower or any of its Subsidiaries fails to conduct any such
environmental test or provide any such report to the Agent, the Agent is
authorized to enter upon the Borrower's or Subsidiary's premises at reasonable
times and on reasonable notice to conduct or have conducted such test and obtain
such report at the Borrower's reasonable expense. The Borrower hereby
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grants to the Agent a license for such purpose, which shall be irrevocable until
all of the Obligations have been fully and finally paid and the Commitments have
terminated.
7.8 Maintain Operating and Other Accounts. Subject to applicable Gaming
Laws, the Borrower and any Subsidiary thereof shall (i) maintain its Operating
Accounts, cash management arrangements and all other Accounts with institutions
that shall have executed deposit account control agreements in favor of the
Agent in form and substance reasonably satisfactory to the Agent and
substantially in the form of Exhibit T, and (ii) notify the Agent promptly of
the closing of any Account specified on Section P of the Disclosure Schedule and
the opening up of any new Accounts (in detail reasonably satisfactory to the
Agent, which shall include, prior to the opening of such Accounts, obtaining
deposit account control agreements in favor of the Agent and in form and
substance reasonably satisfactory to the Agent and substantially in the form of
Exhibit T). The Borrower, any Subsidiary thereof and any Manager shall maintain
funds only in Accounts for which deposit account control agreements have been
executed in favor of the Agent in form and substance reasonably satisfactory to
the Agent and substantially in the form of Exhibit T. No funds in any Account
shall be commingled with any other funds of any Manager, or any Affiliate of any
of the foregoing. As long as no Event of Default shall have occurred and be
continuing, the Borrower, any Subsidiary thereof or if permitted under any
Management Agreement, any Manager, as the case may be, may make or receive
withdrawals from the Operating Accounts and other Accounts to the extent not
prohibited under this Agreement, the other Loan Documents or applicable Gaming
Laws.
7.9 End of Fiscal Years. The Borrower will, for financial reporting
purposes, cause its, and each of its Subsidiaries' Fiscal Years to end on
December 31 of each year.
7.10 Discharge of Liens.
(a) Removal by the Borrower. In the event that, notwithstanding the
covenants contained in Section 8.8, a Lien which is not a Permitted Lien at any
time encumbers any Collateral or any portion thereof, the Borrower, at its
option, shall either (i) promptly discharge or cause to be discharged by payment
to the lienor or Lien claimant or promptly secure removal by bonding or deposit
with the county clerk or otherwise or (ii) pledge cash collateral to the Agent,
for the benefit of the Lenders, in an amount equal to such Lien, within 30 days
after the date of notice thereof; provided that, compliance with the provisions
of this Section 7.10 shall not be deemed to constitute a waiver of the
provisions of Section 8.8. The Borrower shall deliver to the Agent upon written
request therefor all receipts or other reasonably satisfactory evidence of
payment, bonding, deposit of taxes, assessments, Liens or any other item which
may cause any such Lien to be filed against any Collateral. The Borrower and
each of its Subsidiaries shall fully preserve the Lien and the priority of each
Security Document without cost or expense to the Agent or the Lenders.
(b) Removal by the Agent. If the Borrower or any of its Subsidiaries
fails to promptly discharge, remove or pledge cash collateral in respect of any
such Lien or mechanics' or materialmen's claim of Lien as described above, which
is not being contested by the Borrower or any of its Subsidiaries in good faith
by appropriate proceedings promptly instituted and
77
diligently conducted, within 30 days after the receipt of notice thereof, then
the Agent may, but shall not be required to, procure the release and discharge
of such Lien, mechanics' or materialmen's claim of Lien and any judgment or
decree thereon, and in furtherance thereof may, in its reasonable discretion,
effect any settlement or compromise with the lienor or Lien claimant or post any
bond or furnish any security or indemnity as the Agent, in its reasonable
discretion, may elect. In settling, compromising or arranging for the discharge
of any Liens under this subsection, the Agent shall not be required to establish
or confirm the validity or amount of the Lien. The Borrower agrees that all
reasonable costs and expenses expended or otherwise incurred pursuant to this
Section 7.10 (including reasonable attorneys' fees and disbursements) by the
Agent shall be paid by the Borrower in accordance with the terms hereof. All
such advances or expenditures by the Agent shall payable as provided in Section
11.10.
7.11 Further Assurances.
(a) General Assurances. The Borrower shall execute and deliver, or
cause to be executed and delivered, to the Agent such documents and agreements,
and shall take or cause to be taken such actions, as the Agent may, from time to
time, reasonably request to carry out the terms and conditions of this Agreement
and the other Loan Documents.
(b) Filing and Recording Obligations. The Borrower shall pay or
cause to be paid all filing, registration and recording fees and all similar
expenses incident to the execution and acknowledgment of the Mortgage or any
other Security Document and shall pay or cause to be paid all amounts, mortgage
recording taxes, transfer taxes, general intangibles taxes and governmental
stamp and other taxes, duties, imposts, assessments and charges arising out of
or in connection with the execution, delivery, filing, recording or registration
of any Security Document or any other Loan Document, (except to the extent
already recorded) or memoranda thereof (but only to the extent that any such
amounts are not required to be paid by Aladdin pursuant to the Purchase and Sale
Agreement) by reason of its interest in, or measured by amounts payable under,
the Term Loan Notes, any Security Document or any other Loan Document, and shall
pay all stamp taxes and other taxes required to be paid on the Notes or any
other Loan Document, but excluding in the case of each Lender and the Agent,
Taxes imposed on its income by a jurisdiction under the laws of which it is
organized or in which its principal executive office is located or in which its
applicable lender office for funding or booking its Loans hereunder is located
and other taxes described in the proviso to the first sentence of Section
3.7(a). If the Borrower fails to make or cause to be made any of the payments
described in the preceding sentence within 15 days after notice thereof from the
Agent (or such shorter period as is necessary to protect the loss of or
diminution in value of any Collateral by reason of tax foreclosure, as
determined by the Agent, in its reasonable discretion) accompanied by
documentation verifying the nature and amount of such payments, the Agent may
(but shall not be obligated to) pay the amount due and the Borrower shall
reimburse all amounts in accordance with the terms hereof. All such advances or
expenditures by the Agent shall be payable as provided in Section 11.10.
(c) Costs of Defending and Upholding the Lien. The Agent may, upon
at least five Business Days' prior notice to the Borrower, (i) appear in and
defend any action or
78
proceeding, in the name and on behalf of the Agent or the Lenders in which the
Agent or any Lender is named or which the Agent in its reasonable discretion
determines is reasonably likely to materially adversely affect the Mortgaged
Property, any other Collateral, any Security Document, the Liens thereof or any
other Loan Document and (ii) during an Event of Default, institute any action or
proceeding which the Agent reasonably determines should be instituted to protect
the interest or rights of the Agent and the Lenders in the Mortgaged Property or
other Collateral or under any Loan Document. The Borrower agrees that all
reasonable costs and expenses expended or otherwise incurred pursuant to this
subsection (including reasonable attorneys' fees and disbursements) by the Agent
shall be paid by the Borrower or reimbursed to the Agent, as provided in Section
11.10.
(d) Costs of Enforcement. The Borrower agrees to bear and shall pay
or reimburse the Agent and the Lenders in accordance with the terms of Section
11.10 for all reasonable sums, costs and expenses incurred by the Agent and the
Lenders (including reasonable attorneys' fees and the expenses and fees of any
receiver or similar official) of or incidental to the collection of any of the
Obligations, any foreclosure (or transfer in lieu of foreclosure) of this
Agreement, any Security Document or any other Loan Document or any sale of all
or any portion of the Mortgaged Property or all or any portion of the other
Collateral.
7.12 Subsidiary Security Agreement. The Borrower shall with reasonable
promptness (i) cause each of its Subsidiaries and any Person that becomes a
Subsidiary after the Closing Date with the prior written consent of the Required
Lenders to become party to the Security Agreement and execute any other
documents reasonably requested by the Agent in order to perfect its lien on the
Collateral of such Person and (ii) pledge its right, title and interest in the
Equity Interests of such Subsidiary to the Agent as provided in the Security
Agreement.
7.13 Use of Additional Capital for Renovation Capital Expenditures. The
Borrower shall use its commercially reasonable efforts to spend and pay not less
than $90,000,000 on and for Renovation Capital Expenditures (which shall be made
pursuant to bona fide arms length transactions and/or agreements) on or before
the Third Renovation Capital Expenditure Measurement Date (of which (i) at least
$72,000,000 shall be spent and paid by the First Renovation Capital Expenditure
Measurement Date, (ii) at least $81,000,000 shall be spent and paid by the
Second Renovation Capital Expenditure Measurement Date and (iii) the full
$90,000,000 shall be spent and paid by the Third Renovation Capital Expenditure
Measurement Date). If the Borrower has not spent and paid any of the foregoing
amounts on Renovation Capital Expenditures by the foregoing dates, the Borrower
shall make the mandatory payments of principal in the amounts and at the times
set forth in Section 4.3(b) with respect to funds not spent on Renovation
Capital Expenditures. The Borrower hereby acknowledges and agrees that the
$14,000,000 payment described in Section 5.1(x), shall not reduce the
$90,000,000 of Renovation Capital Expenditures required to be made pursuant to
this Section 7.13.
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7.14 Letter of Credit. In the event that the Letter of Credit is issued,
the Borrower shall cause such Letter of Credit to be renewed at least 30 days
prior to its stated expiration date until the earlier of the (i) the date that
the Borrower has spent and paid the amounts required by Section 4.3(b) for
Renovation Capital Expenditures, (ii) the Agent has fully drawn upon such Letter
of Credit as provided in Section 4.3(b) or (iii) the Agent has charged or
directed the payment from the Borrower's loan account, in each case, pursuant to
Section 2.7 in an amount equal to the amount due to the Agent as provided in
Section 4.3(b).
7.15 Ownership of Premises and other Collateral; Defense of Title. (a) The
Borrower shall at all times be the sole legal and beneficial owner of the
Premises and the other Collateral, subject only to (i) the Permitted Liens, (ii)
the Liens created pursuant to the Loan Documents and (iii) such other claims and
interests as may be otherwise expressly allowed by the terms of the Loan
Documents.
(b) The Borrower hereby warrants and agrees to forever defend, all
and singular, title to the Collateral unto the Agent, Lenders and their
respective successors and assigns, forever, against every Person whomsoever
claiming the same or any part thereof, subject, however, to the Permitted Liens.
The Borrower will take all reasonable actions necessary or proper to defend
title to the Premises, subject to Permitted Liens. Agent shall have the right,
to intervene in any suit affecting such title and to employ independent counsel
in connection with any such suit to which it may be a party by intervention or
otherwise, and upon demand, the Borrower agrees to pay Agent all reasonable
expenses paid or incurred by Agent in respect of any such suit affecting title
to any such property or affecting Agent's and Lenders' Lien or rights hereunder,
including, without limitation, reasonable fees and disbursements to the Agent's
attorneys. The Borrower will indemnify and hold harmless Agent and Lenders from
and against any and all costs, expenses, loss, damage or liability including any
and all cost, expense, loss, damage or liability which Agent or Lenders may
suffer or incur by reason of the failure of the title to all or any part of the
Premises, subject to Permitted Liens or by reason of the failure or liability of
the Borrower, for any reason, to convey the rights, titles and interests which
the Mortgage purports to mortgage or assign, and all amounts at any time so
payable by the Borrower shall be secured by the lien of the Mortgage.
7.16 Management of Premises. (a) If the Borrower enters into a Management
Agreement, the Hotel Premises shall at all times be managed under the terms and
conditions of such Management Agreement. The Borrower shall cause the
Subordination Agreements to be executed by any Manager (if the Borrower enters
into a Management Agreement) and the Leasing Manager (if any), and any casino
operator. The Borrower shall cause any Management Agreement and any Leasing
Services Agreement to remain in full force and effect at all times, and shall
comply with any Management Agreement and any Leasing Services Agreement at all
times, except where the failure to so remain in full force and effect or to so
comply would not reasonably be expected to have a Material Adverse Effect, or
would result in a material default under such agreements. The Borrower shall
cause the Hotel Premises to be at all times open for business as a hotel, the
Retail Shops to be open for business as a retail shopping center and the Casino
to be open for business as a casino, except to the extent necessary to undertake
the Renovation Capital Expenditures with due diligence in accordance with the
provisions of
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Section 7.18 hereof. The Borrower shall cause the Premises to be at all times
operated, managed and maintained, at all times and in the manner and accordance
with the standards required pursuant to any Management Agreement and any Leasing
Services Agreement (including all marketing, advertising, promotional and
reservation programs), except where the failure to do so would not reasonably be
expected to have a Material Adverse Effect, or would not result in a material
default under such agreements (if any) but in no event below Comparable
Standards. The Borrower shall, except where the failure to comply would not
reasonably be expected to have a Material Adverse Effect, or would not result in
a material default under such agreements observe, perform, and discharge in all
material respects all obligations, covenants, and warranties provided for under
the terms of any Management Agreement and any Leasing Services Agreement to be
kept, observed, and performed by the Borrower, subject however to any applicable
cure periods provided therein. The Borrower shall not terminate or cancel any
Management Agreement or any Leasing Services Agreement without the prior written
consent of the Agent, which consent shall not be unreasonably withheld or
delayed. The Borrower shall not enter into any other management agreement for
management of the Hotel Premises or the Casino which is not a "Management
Agreement" as defined herein, a leasing and/or services agreement which is not a
"Leasing Services Agreement" as defined herein, or a franchise agreement with
respect to the Premises, in each case without Agent's prior written consent
(acting upon the reasonable direction of the Required Lenders), which consent
shall not be unreasonably withheld or delayed. The Borrower shall not amend,
modify or waive any material provision of any Management Agreement or any
Leasing Services Agreement except upon notice and with the prior written consent
of Agent (acting upon the reasonable direction of the Required Term Loan A
Lenders), which consent shall not be unreasonably withheld or delayed. The
Borrower shall use its commercially reasonable efforts to secure the performance
of the obligations of the Manager under any Management Agreement and of any
Leasing Manager under the Leasing Services Agreement and to enforce the
Borrower's rights thereunder. The Borrower shall not pledge, transfer, assign,
mortgage or encumber the Borrower's interest in any Management Agreement or any
Leasing Services Agreement or any interest therein, or allow to be encumbered
the Borrower's interest in any Management Agreement or any Leasing Services
Agreement or any interest therein, in each case other than as provided herein to
the Agent and the Lenders. Notwithstanding the above, the Borrower may replace
any Manager with an Identified Hotel Manager without the prior written consent
of the Agent.
(b) The Borrower shall not consent to any assignment by any Manager
of its rights and obligations under any Management Agreement or any Leasing
Manager under any Leasing Services Agreement without Agent's prior written
consent (acting upon the reasonable direction of the Required Lenders), which
consent shall not be unreasonably withheld or delayed.
(c) In the event (x) a Manager is terminated and replaced with a new
Manager, which termination and replacement shall only be in accordance with the
provisions of this Agreement, or (y) of any default under, or the termination
of, any agreement entered into in connection with the Time Share Plan or Time
Share Premises, no termination fee, penalty, liability, cost or expense, or
rebranding fee, penalty, liability, cost or expense, shall be paid from any
income or cash flow of the Premise without the prior written consent of the
Agent (acting at the direction of the Required Lenders in their sole and
absolute discretion); provided, however,
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that the Borrower may pay (i) hotel rebranding fees, penalties, liabilities,
costs or expenses (but no termination fees, penalties, liabilities, costs or
expenses) from funds constituting the Reserve Amount without the prior written
consent of the Required Lenders and (ii) any termination or rebranding fees,
penalties, liabilities, costs or expenses from new equity contributed to the
Borrower by the Investor Group; provided, further, that no income or cash flow
of the Premises shall be used to redeem or purchase any Equity Interest in
EquityCo in the event of any default under, or termination of, any agreement
entered into in connection with the Time Share Plan or Time Share Premises.
7.17 Leases.
(a) Leases Generally. The Borrower shall not, without the prior
written consent of the Agent (acting upon the reasonable direction of the
Required Lenders), which consent shall not be unreasonably withheld or delayed,
enter into, amend or modify in any material respect, cancel, terminate, accept a
surrender or shorten the term of, or waive any term, condition or requirement
under, any Lease demising more than 7,500 net leasable square feet of space in
the Premises; provided, that, the Borrower may, without the Agent's prior
consent, enter into, amend or modify in any material respect any Lease demising
7,500 or less net leasable square feet of space in the Retail Shops in the
ordinary course of business provided that (i) the rent thereunder shall be at
prevailing market rates for an enclosed retail shopping center of Comparable
Standards as reasonably determined by the Borrower, (ii) the lease does not
provide for a tenant improvement allowance or other monetary concessions or
allowances in excess of $20 per square foot of raw space and $10 per square foot
for renewals or replacement leases, and (iii) the lease is in a commercially
reasonable form used for similar properties in similar locations; and provided,
further that the Borrower shall be permitted to provide up to four kiosks in
connection with the Time Share Plan during the term of this Agreement at no
charge to the lessee of any such kiosk. For purposes of this Section 7.17(a)
only, multiple Leases with a single Lessee shall be deemed to be one Lease. The
Borrower shall not enter into any lease for the Theater without the prior
written consent of the Agent which consent shall not be unreasonably withheld or
delayed; provided, however, that the Borrower may without the prior consent of
the Agent enter into a lease of the Theater in connection with any concert, show
or event that is presented in the Theater so long as (i) the performer is
headline performer of international repute and standing and the average ticket
price for any such performance is at least $100 per ticket or (ii) any such
lease shall have a term or duration of less than six (6) months.
(b) Compliance with Leases. The Borrower shall use commercially
reasonable efforts to observe, perform, and discharge in all material respects
all material obligations, covenants, and warranties provided for under the terms
of the Leases to be kept, observed, and performed by the Borrower.
(c) Delivery of Copies of Leases, Etc. to the Agent. Within fifteen
(15) days after execution of any Lease or any material amendment, material
modification, material restatement or any extension, renewal or supplement of
any Lease or termination or acceptance of surrender of any Lease, the Borrower
shall deliver to the Agent certified true and complete photocopies of such
Leases, amendments, modifications, restatements, extensions, renewals or
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supplements or documents terminating or accepting such a surrender.
(d) Enforcement of Leases. The Borrower shall use its commercially
reasonable efforts to secure the performance of each and every obligation, term,
covenant, condition, and agreement to be performed by any Lessee under the terms
of the applicable Lease. The Borrower shall appear in and defend any action or
proceeding arising under, occurring out of, or in any manner connected with, the
Leases or the obligations, duties, or liabilities of the Borrower or any Lessee,
if an Event of Default under this Agreement exists and is continuing, upon
reasonable request by Agent to do so, shall appear in and defend in the name and
on behalf of Agent, but at the expense of the Borrower, and shall pay all
reasonable costs and expenses of Agent, including reasonable attorneys' fees and
disbursements, in any action or proceeding in which Agent may appear.
(e) No Collection of Rents in Advance. The Borrower shall not
receive or collect any Rents for a period of more than one (1) month in advance
(excluding for purposes of this Section 7.17(e), security deposits) unless such
advance Rents are deposited in an Operating Account or other blocked Account.
(f) No Transfer of Interest in Leases. The Borrower shall not
pledge, transfer, assign, mortgage, encumber, or allow to be encumbered any
Leases or Rents except to the Agent as provided herein or in the Loan Documents.
(g) Subordination of Leases. All Leases entered into after the
Closing Date shall contain provisions obligating the Lessees thereunder to
attorn to the Agent or any purchaser therefrom in the event Agent or such
purchaser succeeds to the interest of the Borrower under such Leases and shall
be expressly subject and subordinate to the Mortgage either (i) pursuant to its
terms or (ii) pursuant to a subordination, non-disturbance and attornment
agreement in form and substance reasonably satisfactory to the Agent.
(h) Leasing Commissions. The Borrower shall not enter into any
agreement with any Person to pay leasing commissions with regard to any Lease if
such leasing commissions are reasonably expected by the Borrower to be in excess
of the leasing commissions which generally would be payable in the market in
which the Premises is located with respect to a similar lease as of the date of
determination without Agent's prior written consent which consent (acting upon
the reasonable direction of the Required Term Loan A Lenders) shall not be
unreasonably withheld or delayed.
7.18 Maintenance, Operations, Repairs and Alterations.
(a) Generally. The Borrower will, and will cause its Subsidiaries
to, maintain, preserve, protect and keep the Premises and any Property owned or
leased by such Person in good repair, working order and condition (ordinary wear
and tear excepted), and make all necessary and proper repairs, renewals and
replacements so that its business carried on in connection therewith may be
properly conducted at all times. The Borrower shall at all times manage, operate
and maintain the Premises as a luxury themed casino hotel in accordance with
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standards at least equivalent to the Comparable Standards. The theme of the
Premises shall not be materially changed without the prior written consent of
the Agent other than to the extent disclosed to the Agent in writing prior to
the Closing Date, provided that the Agent and Lenders hereby consent to the
re-theming of the Premises as a Planet Hollywood theme consistent with the
Renovation Capital Expenditures described in Exhibit L. The Theater shall be
used to present events which are consistent with the first class nature of the
complex, and consistent with the Comparable Standards.
(b) Repairs. In furtherance of clause (a), the Borrower shall
diligently make or cause to be made all needful and proper repairs, renewals and
replacements thereto whether interior or exterior, structural or non-structural,
ordinary or extraordinary, or foreseen or unforeseen. All such repairs, renewals
and replacements shall be at least equal in quality, value and class to that of
the improvements which are the subject of such repairs, renewals and
replacements. All repairs and alterations at the Premises, including, without
limitation, Significant Repairs and Improvements, the Renovation Capital
Expenditures and Maintenance Capital Expenditures, shall be done in a good and
workmanlike manner and shall be completed substantially in accordance with all
Legal Requirements and free and clear of Liens (other than Permitted Liens) or
claims for materials supplied or for labor or services performed in connection
with such repairs and alterations or otherwise. Prior to commencement of any
Significant Repair or Improvement or Renovation Capital Expenditure, which for
purposes of clauses (i) and (ii) below shall be limited to Renovation Capital
Expenditures that are for construction on the Premises, all of the following
requirements and conditions shall be satisfied:
(i) The Agent (acting at the reasonable direction of the
Required Lenders (such Required Lenders shall make any such determination
referred to in this Section)) shall have determined that (x) the Borrower
has the financial resources to complete the Significant Repair or
Improvement (except for Renovation Capital Expenditures) on a timely and
lien-free basis, other than Permitted Liens, (y) the Renovation Capital
Expenditures can be completed on or before the Third Renovation Capital
Expenditure Date or other period requested by the Borrower and approved by
the Agent (acting upon the reasonable direction of the Required Lenders),
and (z) any other Significant Repair or Improvement can be completed prior
to the Termination Date;
(ii) If reasonably requested by the Agent, the Agent shall
have received architectural or engineering plans and specifications for
the Renovation Capital Expenditures and any other Significant Repair or
Improvement and an estimate of the costs and expenses of such Renovation
Capital Expenditures and any other Significant Repair or Improvement;
(iii) If requested by Agent, Agent shall have received copies
of the agreements pursuant to which the Renovation Capital Expenditures
and any other Significant Repair or Improvement shall be done and the
identities of the parties performing the construction obligations
thereunder;
(iv) Agent shall have received the assignment to the Agent of
all
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construction and design-professional contracts pursuant to the Mortgage
and the Assignment of Contract, together with the written consent to such
assignments by all parties to such contracts (which may be included in any
such contract), all of which shall be in form and substance reasonably
satisfactory to the Agent (acting upon the reasonable direction of the
Required Lenders); and
(v) Agent shall have received such other information and
documentation as Agent may reasonably request regarding the Renovation
Capital Expenditures and any other Significant Improvement and Repair and
the restoration or repairs and the cost thereof.
The Borrower shall not undertake to construct (i) any Renovation Capital
Expenditures and any other Significant Repair or Improvement except in
compliance with this Section 7.18(b) hereof, and (ii) with respect to any
Renovation Capital Expenditures, also in compliance with Section 4.3(b).
(c) Agent's Inspection. From time to time and upon reasonable prior
notice to the Borrower (except in cases of Casualty Events or other similar
emergencies in which case no notice need be given), as required by Agent, the
Borrower shall, or cause any Manager to, permit the Agent, any Lender and their
respective agents and representatives, to enter upon any of the Premises during
normal business hours for the purpose of inspection thereof. Without limitation
of the foregoing, the Borrower shall, or cause any Manager to, permit the Agent
and the Agent's designated representatives to enter upon the Premises, at any
reasonable times during business hours on reasonable notice, to inspect, examine
or copy:
(i) All materials and shop drawings pertaining to the
performance of the Renovation Capital Expenditures and any other
Significant Repairs and Improvements;
(ii) Any contracts, bills of sale, statements, receipts or
vouchers pertaining to the Renovation Capital Expenditures and any other
Significant Repairs and Improvements;
(iii) All work done, labor performed or materials furnished in
connection with the Renovation Capital Expenditures and any other
Significant Repairs and Improvements; and
(iv) All books, contracts and records of the Borrower
pertaining to the Significant Repairs and Improvements.
(d) The Borrower shall keep in effect at all times any material
contractual arrangements, as may be necessary to meet the standard of operation
described in this Section 7.18 or as may be required by Legal Requirements and
all Permits.
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7.19 Application of Insurance Proceeds.
(a) The Borrower shall give prompt notice to the Agent of any
damage, destruction or casualty to the Premises or any part thereof, whether or
not covered by insurance, the cost of restoration of which is in excess of
$1,500,000.
(b) Provided no Event of Default shall have occurred and be
continuing, the Borrower may make proof of loss, adjust and compromise any claim
under any insurance policy, appear in and prosecute any action arising from such
insurance policy, collect and receive the proceeds of any and all insurance that
may become payable with respect to any damage, destruction or casualty to the
Premises so long as the cost of the repair or restoration necessitated by such
damage, destruction or casualty, in the reasonable estimate of the Agent will
not exceed Five Million Dollars ($5,000,000). Provided no Event of Default shall
have occurred and be continuing, the Borrower shall use all such proceeds
actually received by it to restore or rebuild the Premises to a condition
reasonably satisfactory to the Agent, but in any event to substantially the same
character and condition as prior to such damage, destruction or casualty,
subject to the provisions of Section 4.3(c). Any insurance proceeds which may
remain after payment of all costs and expenses of such repair and restoration
shall, at the option of the Agent, be applied as a prepayment of the Obligations
in the manner set forth herein.
(c) If the cost of restoration or repair of any damage, destruction
or casualty to the Premises, or any part thereof, in the reasonable estimate of
the Agent, will equal or exceed Five Million Dollars ($5,000,000), the Agent may
collect the proceeds of any and all insurance that may become payable with
respect thereto (and the Borrower hereby authorizes and directs any insurance
company to make payments of such proceeds directly to the Agent at the Agent's
request). The Net Cash Proceeds from the Insurance Policies shall be made
available to Borrower for the restoration and repair of the Premises from time
to time as such restoration or repair progresses, subject to compliance by the
Borrower with Section 4.3(e) hereof and to compliance by the Borrower with the
following terms and conditions:
(i) No Event of Default shall have occurred and be continuing;
(ii) The Borrower shall deposit with the Agent sums in an amount at
least equal to the excess, if any, of the Agent's reasonable estimate of the
aggregate costs and expenses of restoration and repair of the Premises, over the
amount of insurance proceeds payable with respect to such damage, destruction or
casualty, which additional sums shall be disbursed by the Agent prior to any
disbursements of insurance proceeds;
(iii) In the Agent's reasonable judgment, the repairs and
renovations can be completed prior to the then Maturity Date;
(iv) At the request of the Agent, prior to the commencement of any
work the Agent shall have received architectural plans and specifications for
all restoration and repairs and an estimate of the costs and expenses of all
such restoration and repairs, all of which shall be in form reasonably
acceptable to the Agent;
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(v) Prior to any disbursement by the Agent, the following
information and documentation shall have been obtained by the Borrower, at the
Borrower's expense, and submitted to the Agent, which information and
documentation shall be in form and substance reasonably satisfactory to the
Agent:
(A) A request for disbursement signed by the Borrower, accompanied
by billing statements, vouchers or invoices, which request for
disbursement shall expressly warrant that the work with respect to which
the advance is requested has been performed in all material respects in
accordance with the approved plans and specifications for the restoration
or repair;
(B) At the request of the Agent, proof that all invoices for labor
and materials previously submitted by Borrower and approved and reimbursed
by the Agent have been paid, except for those the subject of the current
request for disbursement and except for any invoices which the Borrower
informs the Agent are being disputed in good faith by the Borrower and for
which appropriate reserves have been established;
(C) At the request of the Agent, lien waivers for all payees under
previous requests for advances, except with respect to those liens being
contested by the Borrower in good faith in accordance with this Agreement;
(D) At the request of the Agent, a report from the Borrower's
architect which shall specify the percentage of completion of restoration
or repair, shall provide reasonably detailed comments on specific work
performed since the date of the last such report, and, if required by the
Agent, an estimate of the cost to complete the restoration and repair
after taking into account the work then completed;
(E) At the request of the Agent, an endorsement of the Title
Insurance Policy, which endorsement shall show no liens of record or
additional encumbrances not acceptable to the Agent, other than Permitted
Liens;
(F) At the request of the Agent, copies of the agreements pursuant
to which the restoration or repair shall be done and the identities of the
parties performing the construction obligations thereunder;
(G) An assignment to the Agent of all construction and
design-professional contracts (which may be pursuant to the Mortgage),
together with the written consent to such assignments by all parties to
such contracts (which may be included in any such contract) to the extent
required thereunder; and
(H) Such other information and documentation as the Agent may
reasonably request regarding the Improvements and the restoration or
repairs and the cost thereof.
In the event each of the conditions set forth in clauses (i) through
(v) above is not
87
satisfied within eighteen (18) months from and after the date of the respective
damage, destruction or casualty, or if such conditions cannot reasonably be
satisfied within said eighteen (18)-month period, if the Borrower fails to
commence satisfaction of such condition within said (18)-month period or
thereafter fails to diligently pursue such efforts to completion, then the Agent
may apply the insurance proceeds actually received by it to the payment of the
Obligations in the same manner and under the same conditions as insurance
proceeds are applied as set forth in Section 4.3(e) hereof.
(d) Prior to application or disbursal of any insurance proceeds
received by the Agent under this Section 7.19, the Agent may deduct therefrom
any expenses reasonably incurred by the Agent in connection with the collection
or handling of such proceeds, it being understood and agreed that neither the
Agent nor the Lenders shall be, under any circumstances, liable or responsible
for failure to collect, or to exercise diligence in the collection of, any such
proceeds, and upon the request of the Borrower, the Agent shall provide the
Borrower with a written summary of all expenses deducted from such proceeds.
(e) In the event the Mortgage is foreclosed or title to the Premises
is transferred to the Agent or Lenders by a deed in lieu of foreclosure, all
right, title, and interest of the Borrower in and to all Insurance Policies and
the proceeds thereof shall inure to the benefit of and pass to the Agent.
7.20 Application of Condemnation Proceeds. The Agent shall be entitled to
receive any and all sums which may be awarded or become payable to the Borrower
for any Taking of the Premises for public or quasi-public use, or by virtue of
private sale in lieu thereof, and any sums which may be awarded or become
payable to the Borrower for damages caused by public works or construction on or
near the Premises. All such sums are hereby assigned to the Agent and the
Borrower shall, upon the reasonable request of the Agent, make, execute,
acknowledge, and deliver any and all additional assignments and documents as may
be necessary from time to time to enable the Agent to collect and receive any
such sums. The Agent may apply all such sums actually received by the Agent to
the payment of the Obligations in such order and manner as is set forth herein.
If the Premises or any part thereof is condemned, so long as no Event of Default
shall have occurred and shall be continuing, and provided the Borrower promptly
files all claims and diligently prosecutes the condemnation proceeding, the
Borrower shall have the right to file, adjust, settle and prosecute any claim
for any such awards or compensation relating to any such condemnation
proceeding; provided, however, the Borrower shall not agree to any adjustment or
settlement of any such claim payable with respect to any such condemnation
proceeding which awards and proceeds are reasonably estimated by the Agent to be
equal to or greater than $5,000,000; and provided, further, in the event that
the Agent reasonably determines that the Borrower is not diligently prosecuting
such claim, the Agent shall have the right, but not the obligation, to revoke
the Borrower's right to adjust, settle and prosecute any claim for any such
awards or compensation relating to such any such condemnation proceeding by
delivering a notice of same to the Borrower, which revocation shall be effective
immediately upon the Borrower's receipt of such notice. Notwithstanding the
foregoing, if the Premises or any part thereof is condemned and the awards and
proceeds of condemnation are reasonably estimated by the Agent to equal or
exceed five million Dollars ($5,000,000), then the Borrower authorizes and
88
empowers Agent, at Agent's reasonable option, as attorney-in-fact for the
Borrower, to commence, appear in and prosecute, in the Agent's or the Borrower's
name, any action or proceeding relating to any condemnation of the Premises or
any portion thereof, to settle or compromise any claim in connection with such
condemnation, to collect and receive condemnation awards and to deduct the
Agent's reasonable expenses in the settlement process. The Agent shall provide
the Borrower with a written summary of all expenses deducted from such awards.
If Agent elects not to participate in such condemnation proceeding, then the
Borrower shall, at its expense, diligently prosecute any such proceeding.
Neither the Agent nor the Lenders shall be, under any circumstances, liable or
responsible for failure to collect, or exercise diligence in the collection of,
any of such sums. Any sums so collected shall be applied by the Agent, first, to
the reasonable expenses, if any, of collection, and then in the same manner and
under the same conditions as insurance proceeds are applied as set forth in
Section 4.3(e) hereof.
7.21 Appraisals. At any time after the occurrence of an Event of Default,
the Agent shall have the right to cause an Appraisal of the Premises to be
performed at any time and from time to time; provided, that only one such
Appraisal per year shall be at the Borrower's cost and expense. In all events,
the Borrower shall cooperate with the Agent and any such appraiser and their
agents and employees in connection with such Appraisal.
7.22 ERISA. The Borrower shall, and shall use its reasonable best efforts
to cause each of its ERISA Affiliates to:
(a) Pay and discharge promptly any liability imposed upon it
pursuant to the provisions of Title IV of ERISA; provided, however, that neither
the Borrower nor any ERISA Affiliate shall be required to pay any such liability
if (1) the amount, applicability or validity thereof shall be diligently
contested in good faith by appropriate proceedings, and (2) such Person shall
have set aside on its books reserves which, in the opinion of the independent
certified public accountants of such Person, are adequate with respect thereto.
(b) Deliver to the Agent, promptly and in any event within five
Business Days after (or within such other time period specified) (i) the
occurrence of any Reportable Event, a copy of the materials that are filed with
the PBGC, or the materials that would have been required to be filed if the
30-day notice requirement to the PBGC was not waived, (ii) the Borrower or any
ERISA Affiliate or an administrator of any Pension Plan files with participants,
beneficiaries or the PBGC a notice of intent to terminate any such Plan, a copy
of any such notice, (iii) within five Business Days, the receipt of notice by
the Borrower or any ERISA Affiliate or an administrator of any Pension Plan from
the PBGC of the PBGC's intention to terminate any Pension Plan or to appoint a
trustee to administer any such Plan, a copy of such notice, (iv) within 30 days
after, the filing thereof with the Internal Revenue Service, copies of each
annual report that is filed on Treasury Form 5500 with respect to any Pension
Plan, together with certified financial statements (if any) for the Plan and any
actuarial statements on Schedule B to such Form 5500, (v) five Business Days
after, the Borrower or any ERISA Affiliate knows or has reason to know of any
event or condition which might constitute grounds under the provisions of
Section 4042 of ERISA for the termination of (or the appointment of a trustee to
administer) any Pension Plan, an
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explanation of such event or condition, (vi) the receipt by the Borrower or any
ERISA Affiliate of an assessment of withdrawal liability under Section 4201 of
ERISA from a Multiemployer Plan, a copy of such assessment, (vii) within five
Business Days, the Borrower or any ERISA Affiliate knows or has reason to know
of any event or condition which might cause any one of them to incur a liability
under Section 4062, 4063, 4064 or 4069 of ERISA or Section 412(n) or 4971 of the
Code, an explanation of such event or condition, (viii) the Borrower or any
ERISA Affiliate knows or has reason to know that an application is to be, or has
been, made to the Secretary of the Treasury for a waiver of the minimum funding
standard under the provisions of Section 412 of the Code, a copy of such
application, and (ix) the establishment of, or the incurrence of the obligation
to contribute to, any Pension Plan or Multiemployer Plan by the Borrower or any
ERISA Affiliate, and in each case described in clauses (i) through (iii) and (v)
through (ix) together with a statement signed by the Approved Officer of the
Borrower setting forth details as to such Reportable Event, notice, event or
condition and the action which the Borrower or such ERISA Affiliate proposes to
take with respect thereto.
7.23 Intentionally Omitted.
7.24 Material Operating Agreements.
(a) Generally. The Borrower shall not, without the prior written
consent of the Agent (acting upon the reasonable direction of the Required Term
Loan A Lenders) which consent shall not be unreasonably withheld or delayed,
enter into, amend or modify in any material respect, cancel, terminate or
shorten the term of, or waive any material term, condition or requirement under,
any Material Operating Agreement (other than entering into agreements in
connection with the Time Share Plan in accordance with Section 8.23).
(b) Compliance. The Borrower shall observe, perform, and discharge
in all material respects all material obligations, covenants, and warranties
provided for under the terms of the Material Operating Agreements to be kept,
observed, and performed by the Borrower.
(c) Delivery of Copies of Material Operating Agreement, Etc. to the
Agent. Within ten (10) days after execution of any Material Operating Agreement
or any amendment, modification, restatement, extension, renewal or supplement of
any Material Operating Agreement or termination of any Material Operating
Agreement, the Borrower shall deliver to the Agent a complete copy of such
Material Operating Agreement, amendments, modifications, restatements,
extensions, renewals or supplements.
(d) Enforcement of Material Operating Agreement. The Borrower shall
use commercially reasonable efforts to enforce or secure the performance of each
and every obligation, term, covenant, condition, and agreement to be performed
by any party under the terms of the applicable Material Operating Agreement,
except where the failure would not reasonably be expected to have a Material
Adverse Effect or would result in a material default thereunder. The Borrower
shall, appear in and defend any action or proceeding arising under, occurring
out of, or in any manner connected with, the Material Operating Agreements or
the obligations, duties, or liabilities of the Borrower or any party thereto. If
an Event of Default under this Agreement exists
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and is continuing, either (i) upon reasonable request by the Agent to do so, the
Borrower shall appear in and defend in the name and on behalf of the Agent, at
the reasonable expense of the Borrower, or (ii) the Agent may appear in and
defend itself, but, in each case, the Borrower shall pay all reasonable costs
and expenses of the Agent, including reasonable attorneys' fees and
disbursements, in any action or proceeding in which the Agent may appear.
(e) No Transfer of Interest in Material Operating Agreement. The
Borrower shall not pledge, transfer, assign any Material Operating Agreement
except to the Agent as provided herein or in the Loan Documents.
7.25 Use of Reserve Amount and Operating Cash Reserve Amount. The Borrower
shall use the funds that constitute the Reserve Amount solely for general
business purposes and in any manner not prohibited by this Agreement. To the
extent that the Gaming Laws are applicable to funds that constitute the
Operating Cash Reserve Amount, the Borrower shall use the Operating Cash Reserve
Amount in a manner that does not violate any applicable laws (including without
limitation the Gaming Laws) and shall otherwise use the funds that constitute
the Operating Cash Reserve Amount solely for general business purposes and in
any manner not prohibited by this Agreement or any applicable laws.
7.26 Easements, Etc., in Favor of Time Share Entity. The Borrower shall
obtain the prior written consent of the Agent (which consent shall not
unreasonably be withheld or delayed) prior to its granting any easement in favor
of the Time Share Entity or entering into any reciprocal rights agreement or any
other comparable agreement with the Time Share Entity or otherwise with respect
to the Time Share Premises.
7.27 Consents. (a) The Borrower shall use its commercially reasonable
efforts to obtain any consents to the pledge or assignment to the Agent for the
benefit of the Lenders of the contracts, leases and agreements described on
Schedule 6.1 except, other than in the case of any Material Operating Agreement,
where the failure to obtain such consent would not have a Material Adverse
Effect or materially impair the Collateral taken as a whole.
(b) The Borrower shall use its reasonable best efforts to obtain as
soon as possible each of the Permits listed on Section D(ii) of the Disclosure
Schedule and upon obtaining any such Permit shall provide the Agent with
evidence thereof.
7.28 Term Loan A Note Rating. The Borrower shall use reasonable best
efforts to obtain (and shall fully cooperate with any efforts made by the Agent
to obtain) a rating for the Term Loan A Notes from both Xxxxx'x Investors
Services and Standard & Poor's (or, in either case, by such other nationally
recognized rating agency reasonably acceptable to the Agent in the event that
Xxxxx'x Investors Services and/or Standard & Poor's fails to give a rating) as
soon as reasonably practicable after the Closing Date and shall commence such
efforts (which shall entail, among other actions, providing all documentation
requested or required by such rating agencies) by no later than November 1,
2004, and shall
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provide satisfactory evidence thereof to the Agent and shall maintain at all
times such rating until such time as the Term Loan A has been paid in full.
Notwithstanding the foregoing, the Borrower shall not be required to deliver to
such ratings agencies (x) its business plan prior to the date that such business
plan is required to be delivered to the Agent pursuant to Section 7.32 or (y)
the Borrower's Plan prior to the date that the Borrower's Plan is required to be
delivered to Boulevard Invest pursuant to Section 7.30(a); provided that, if
requested by such ratings agencies, the Borrower shall provide drafts of such
materials as may then exist. The Borrower shall pay any reasonable costs or
expenses incurred in connection with obtaining and maintaining such ratings.
7.29 Certain Matters Relating to Time Share Premises. The Borrower shall
use commercially reasonable efforts to execute definitive agreement(s) to
develop and operate the Time Share Premises by no later than December 31, 2004.
The form and substance of such agreements and the proposed Developer shall be
subject to the prior written approval of the Agent (acting at the direction of
the Required Term Loan A Lenders (other than the FF&E Lender)), such approval
not to be unreasonably withheld (so long as the requirements for the payment of
the Marketing Fees set forth in Section 8.23 are satisfied) or delayed. The
Borrower shall deliver copies of such definitive documentation to the Agent
promptly after the execution thereof (it being understood that the failure of
the Borrower to comply with the December 31, 2004 date shall not result in an
Event of Default hereunder).
7.30 Delivery of Borrower's Plan. (a) On or before March 31, 2005, the
Borrower shall (i) deliver a plan (the "Borrower's Plan") to Boulevard Invest
(successor-in-interest to Aladdin Bazaar, LLC) setting forth any Renovation
Capital Expenditures and other activities which the Borrower believes shall
require the prior consent of Boulevard Invest under the REA or otherwise and
(ii) expressly request that Boulevard Invest consent to the Borrower's Plan
(including any proposed Renovation Capital Expenditures that the Borrower
believes shall require the prior consent of Boulevard Invest). The Borrower's
Plan shall be satisfactory to the Agent (acting at the reasonable direction of
the Required Term Loan A Lenders).
(b) Within 90 days following the consent of Boulevard Invest contemplated
by Section 7.30(a), Borrower shall use its reasonable best efforts to enter
into, and cause the recording of, an amendment to the REA reflecting any
amendments, modifications or supplements to the REA that are reasonably required
to implement the Borrower's Plan and such REA amendment.
7.31 Notice under Mezzanine Escrow Agreement. The Borrower shall use its
reasonable best efforts to cause Holdings to give notice under Section 5(d) or
Section 5(e) of the Mezzanine Escrow Agreement to permit funds in the Theater
Escrow Account to be withdrawn therefrom and deposited into the Renovation
Capital Expenditure Account at the earliest time permitted under the Theater
Escrow Account.
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7.32 Delivery of Business Plan. By no later than December 31, 2004, the
Borrower shall deliver to the Agent (with copies for each Lender) its business
plan which shall contain monthly financial projections for the twelve months
ending December 31, 2005 and annual projections thereafter through the Maturity
Date.
ARTICLE 8
NEGATIVE COVENANTS
The Borrower covenants and agrees that so long as this Agreement is
in effect and until the Commitments have terminated and all Obligations (other
than any indemnities which are not then due and payable) are discharged in full,
the Borrower shall not and shall not permit any of its Subsidiaries and in the
case of Section 8.21 hereof, any ERISA Affiliate, to directly or indirectly:
8.1 Mergers, Consolidations, Sales or other Disposition; Disposition of
Time Share Premises. Enter into any transaction of merger, reorganization, or
consolidation, or effect any Asset Transfer (including, without limitation, any
Disposition of the Time Share Premises); or wind up, liquidate or dissolve, or
agree to do any of the foregoing, except:
(a) the Disposition of the Time Share Premises by the Borrower to
Holdings for an amount equal to $14,000,000 so that the Borrower shall receive
or shall be deemed to have received the payment described in Section 5.1(x) of
this Agreement and thereafter the Agent shall receive the payment described in
Section 5.1(x) of this Agreement, or any other Disposition of the Time Share
Premises consented to in writing by the Required Term Loan A Lenders (other than
the FF&E Lender);
(b) a merger of any Subsidiary into the Borrower or any Subsidiary;
(c) a sale or Disposition with or without consideration, of Property
determined to be obsolete or surplus or unnecessary to the business operations
of the Borrower in the discretion of management exercised pursuant to normal
commercial standards, so long as the Fair Market Value of all such Property so
disposed of in any Fiscal Year with consideration does not exceed $1,000,000 in
the aggregate, provided such Property is promptly replaced with Property of
equal or greater value;
(d) liquidations of Permitted Investments;
(e) dispositions of assets resulting from a Casualty Event;
(f) sales, conveyances, or dispositions of inventory in the ordinary
course of business;
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(g) any Subsidiary of the Borrower may sell, lease or otherwise
transfer assets to the Borrower or any wholly-owned Subsidiary of the Borrower,
provided that the Borrower and any such Subsidiary shall execute all documents
reasonably requested by the Agent to maintain or create the Agent's security
interest in such assets that constitute Collateral and such transfer would not
reasonably be expected to have a Material Adverse Effect;
(h) the Borrower and its Subsidiaries may dispose of any assets
having a fair market value not in excess of $1,000,000, provided that (i) the
aggregate sale proceeds of all assets subject to dispositions pursuant to this
clause (h) shall not exceed $5,000,000 in any Fiscal Year, (ii) each such
Disposition is for Fair Market Value, (iii) at least 90% of the consideration
received in respect thereof is cash and (iv) the Net Cash Proceeds of such
disposition are applied or reinvested in accordance with Section 4.3(c) of this
Agreement;
(i) the Borrower and its Subsidiaries may remove or otherwise
dispose of Property in connection with the making of Renovation Capital
Expenditures so long as the Net Cash Proceeds from any such Disposition are
applied or reinvested in accordance with Section 4.3(c) of this Agreement;
(j) transfers of cash to Aladdin if required under Section 2.10(d)
of the Purchase and Sale Agreement; and
(k) other sales, transfers or other Dispositions of assets not to
exceed $500,000 in the aggregate in any Fiscal Year.
8.2 Distributions. Directly or indirectly declare or make, or incur any
liability to make, any Distribution, other than (a) the Borrower may declare and
pay dividends with respect to its Equity Interests payable solely in additional
Equity Interests, (b) Subsidiaries may declare and pay dividends ratably with
respect to their Equity Interests (c) so long as at the time thereof and
immediately after giving effect thereto, no Event of Default shall have occurred
and be continuing for each calendar year the Borrower may make a cash
Distribution equal to the Borrower's Tax Liability for the prior calendar year;
provided, that at the request of the Agent the Borrower will provide the Agent
with any documentation supporting its calculation of any Distribution proposed
to be made pursuant to this Section 8.2(c) for the Agent's review and approval
(which approval shall not be unreasonably withheld or delayed) no later than
five (5) Business Days prior to the estimated date of such Distribution, (d) so
long as (i) at the time thereof and immediately after giving effect thereto no
Event or Event of Default shall have occurred and be continuing, and (ii) the
Leverage Ratio is less than 5.00:1.00, the Borrower may pay dividends or make
other Distributions to its Members on a quarterly basis to be used to make
payments on the Mezzanine Loan, or on any Debt or equity financing of Holdings
related to the acquisition, renovation or operation of the Premises (including
but not limited to any refinancings of any of the foregoing) provided, that the
aggregate amount of any such Distributions does not exceed $6,000,000 per Fiscal
Year (of which no more than $1,500,000 may be distributed in any Fiscal
Quarter), and (e) so long as at the time thereof and immediately after giving
effect thereto, no Event of Default shall have occurred and be continuing, the
Borrower may make a Distribution in cash to reimburse Holdings, EquityCo and
BH/RE for actual out-of-pocket operating expenses previously incurred
94
by such Persons so long as such operating expenses were consistent with the
restrictions set forth in Section 8.34 (Limited Activities) and do not exceed
$200,000 in the aggregate in any Fiscal Year; provided, that at the request of
the Agent the Borrower will provide the Agent with any documentation supporting
its calculation of any Distribution proposed to be made pursuant to this Section
8.2(e) for the Agent's review and approval (which approval shall not be
unreasonably withheld or delayed) no later than five (5) Business Days prior to
the estimated date of such Distribution.
8.3 Guaranties. Make, issue, or become liable on any Guaranty, except (a)
endorsements of instruments for deposit or collection in the ordinary course of
business, (b) Guaranties existing on the Closing Date as set forth on Schedule
8.3, (c) customary indemnities in the ordinary course of business, (d)
Guaranties of Debt permitted by Section 8.4 and (e) the subordinated Guaranty of
the Borrower, dated as of the Closing Date, issued in favor of the Mezzanine
Lender, and subject to the Mezzanine Intercreditor Agreement.
8.4 Debt. Create, incur, assume, maintain or otherwise become liable or be
liable in respect of any Debt, other than: (a) the Obligations; (b) Debt of the
Borrower or any Subsidiary incurred to finance the acquisition, construction or
improvement of any fixed or capital assets, including Capital Leases and any
Debt assumed in connection with the acquisition of any such assets or secured by
a Lien on any such assets prior to the acquisition thereof, and extensions,
renewals and replacements of any such Debt that do not increase the outstanding
principal amount thereof; provided; that the aggregate amount of Debt permitted
by this clause (b) shall not exceed $3,250,000; and provided; further that (i)
such Debt is incurred prior to or within 90 days after such acquisition or the
completion of such construction or improvement and (ii) the aggregate principal
amount of Debt permitted by this clause (b) shall be in compliance with Section
8.11 (Capital Expenditures); (c) the Debt listed on Schedule 8.4 hereto (which
shall include Debt (other than the Obligations) of Aladdin assumed by the
Borrower pursuant to the Purchase and Sale Agreement) and any renewals,
extensions or refinancing thereof that do not increase the aggregate outstanding
principal amount thereof, plus accrued and unpaid interest on the Debt
refinanced; (d) the Guaranties permitted by Section 8.3; (e) Debt of any Person
that becomes a Subsidiary after the date hereof, in accordance with the terms
hereof, provided that such Debt exists at the time such Person becomes a
Subsidiary and is not created in contemplation of or in connection with such
Person becoming a Subsidiary and provided, further, that the Borrower does not
become liable for any such Debt; (f) Debt of the Borrower or any Subsidiary as
an account party in respect of trade letters of credit issued in the ordinary
course of business; (g) unsecured intercompany Debt among the Borrower and its
Subsidiaries that are Guarantors, provided that if any of such Debt is evidenced
by intercompany notes, such notes shall be pledged to the Agent; (h) Debt of the
Borrower or its Subsidiaries in respect of performance bonds, bid bonds, appeal
bonds, surety bonds and similar obligations and trade-related letters of credit,
in each case provided in the ordinary course of business, and any extension,
renewal or refinancing thereof to the extent not provided to secure the
repayment of other Indebtedness and to the extent that the amount of refinancing
Indebtedness is not greater than the amount of Indebtedness being refinanced;
(i) Hedge Obligations (provided, however, that the notional principal amount of
any such Hedge Obligations does not exceed the principal amount of indebtedness
to which such Hedge Obligation relates); (j) other unsecured Debt of the
Borrower and its Subsidiaries not to
95
exceed $500,000 in aggregate principal amount outstanding and (k) the
subordinated Guaranty of the Borrower, dated as of the Closing Date, issued in
favor of the Mezzanine Lender, and subject to the Mezzanine Intercreditor
Agreement.
8.5 Prepayment; Certain Matters Relating to the Mezzanine Loan. (a) Other
than in accordance with their terms, voluntarily prepay, redeem, purchase or
retire any Debt, other than the Obligations.
(b) Modify, amend, supplement or otherwise alter (or permit the
modification, amendment, supplementation, or alteration of) the terms and
provisions of the Mezzanine Loan or any Mezzanine Loan Document other than in
accordance with the provisions of the Mezzanine Intercreditor Agreement.
(c) Make any payments with respect to or on account of the Mezzanine
Loan other than Distributions permitted by Section 8.2(d) of this Agreement.
8.6 Transactions with Affiliates. Except as set forth below or as
otherwise permitted hereunder, sell, transfer, distribute, or pay any money or
Property to any Affiliate, or lend or advance money or Property to any
Affiliate, or invest in (by capital contribution or otherwise) or purchase or
repurchase any stock or indebtedness, or any Property, of any Affiliate, or
become liable on any Guaranty of the indebtedness, dividends, or other
obligations of any Affiliate (except as permitted by Section 8.3) except that:
(a) Distributions may be made to the extent provided in Section 8.2; (b)
customary and reasonable fees, indemnities and reimbursements may be paid to
officers and directors of the Borrower and its Subsidiaries; (c) the Borrower or
any of its Subsidiaries may enter into employment, noncompetition or
confidentiality agreements with their employees in the ordinary course of
business; (d) management fees may be paid to any Manager in accordance with the
Manager Subordination Agreement, and license and/or franchise fees may be paid
to Planet Hollywood in accordance with the License Subordination Agreement; (e)
loans or advances may be made to employees of the Borrower to fund moving and
travel expenses and the exercise price of options granted under employment
agreements or stock option plans or agreements of the Borrower, not to exceed
$400,000 outstanding at any time or (f) any transaction entered into by the
Borrower in connection with the development or operation of the Time Share
Premises in accordance with documentation approved by the Agent acting at the
reasonable direction of the Required Term Loan A Lenders (other than the FF&E
Lender) under Section 7.29 and Section 8.23. Notwithstanding anything in the
preceding sentence to the contrary, the Borrower and its Subsidiaries may engage
in transactions with Affiliates in the normal course of business, in amounts and
upon terms fully disclosed to the Agent on a quarterly basis which are no less
favorable to the Borrower and its Subsidiaries than would be obtainable in a
comparable arm's length transaction with a third party who is not an Affiliate.
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8.7 Business Conducted. Engage, directly or indirectly, in any line of
business other than that directly related to the Premises or the Time Share
Premises (which shall include the Time Share Plan and any agreement documenting
such Time Share Plan that is approved by the Agent in accordance with Section
7.29 and Section 8.23) or reasonably incidental thereto. The Borrower shall not
discontinue the operation of the Premises or any material portion thereof
without the prior written consent of the Agent (acting upon the reasonable
direction of the Required Lenders), which consent shall not be unreasonably
withheld or delayed.
8.8 Liens. Create, incur, assume, or permit to exist any Lien on any
Property now owned or hereafter acquired by any of them, except Permitted Liens.
8.9 Subsidiaries. Without the prior written consent of the Required
Lenders, (i) to cause or permit any Subsidiary of the Borrower to acquire any
material Property, or (ii) directly or indirectly, organize or acquire any
Subsidiary after the Closing Date, unless such Property or the Borrower's
interest in any new Subsidiary is pledged to the Agent in accordance with the
Security Documents and such new Subsidiary enters into a Guaranty of the
Obligations in form and substance reasonably satisfactory to the Agent.
8.10 Restricted Investments. Make any Restricted Investment.
8.11 Capital Expenditures. Make any Capital Expenditures other than
Renovation Capital Expenditures, Maintenance Capital Expenditures, Capital
Expenditures permitted under Sections 4.3(c), 8.1(c) and 8.1(h), and other
Capital Expenditures payable solely out of the Reserve Amount, unless the Agent
receives evidence reasonably satisfactory to it that the holders of the Equity
Interests of the Borrower shall have provided cash equity to the Borrower to be
used solely for Capital Expenditures.
8.12 Maintenance Capital Expenditures. Permit the aggregate amount of
payments made for Maintenance Capital Expenditures of the Borrower and its
Subsidiaries on a consolidated basis to exceed the amounts set forth opposite
the periods below:
Period Amount
------ ------
Closing Date through first Anniversary Date $ 5,000,000
First Anniversary Date through second Anniversary Date $11,200,000
Second Anniversary Date through third Anniversary Date $12,300,000
Third Anniversary Date through fourth Anniversary Date $15,000,000
Fourth Anniversary Date through the fifth Anniversary Date $16,000,000
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Period Amount
------ ------
Fifth Anniversary Date through the Final Maturity Date $16,500,000
In addition to the amounts permitted above, the Borrower and its
Subsidiaries may make Capital Expenditures of up to $3,000,000 in the aggregate
(plus the Net Cash Proceeds of any Casualty Event) with Net Cash Proceeds of an
Asset Transfer or a Casualty Event in any Fiscal Year identified in a
Reinvestment Notice as a Reinvestment Amount in accordance with Section 4.3(c);
provided, that any such Capital Expenditures shall not constitute Maintenance
Capital Expenditures in clause (v) of the definition of Excess Cash Flow and in
clause (iv) in the definition of Reserve Amount.
In any twelve-month period referred to above, the unused portion of
Maintenance Capital Expenditures for such twelve-month period (without giving
effect to any prior carry-forward) may be expended by the Borrower only in the
immediately succeeding twelve-month period and the amounts so carried over shall
only be used after utilization of all allowed amounts (without regard to such
rollover) for Maintenance Capital Expenditures in such succeeding twelve-month
period.
8.13 EBITDA. (a) The Borrower will not permit EBITDA for any of the
periods set forth below, to be less than the respective amount set forth below
opposite such period:
Period Amount
------ ------
The consecutive twelve (12) month period immediately following the Closing Date
(the "First Measurement
Period") $ 20,000,000
The consecutive twelve (12) month period immediately following the last day of
the First Measurement Period
(the "Second Measurement Period") $ 30,000,000
The consecutive twelve (12) month period immediately following the last day of
the Second Measurement Period
(the "Third Measurement Period") $ 60,000,000
The consecutive twelve (12) month period immediately following the last day of
the Third Measurement Period
(the "Fourth Measurement Period") $ 70,000,00
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Period Amount
------ ------
The consecutive twelve (12) month period immediately following the last day of
the Fourth Measurement Period
(the "Fifth Measurement Period") $ 75,000,000
The consecutive twelve (12) month period immediately following the last day of
the Fifth Measurement Period
(the "Sixth Measurement Period") $ 80,000,000
(b) Notwithstanding the above, if EBITDA at the end of the First
Measurement Period or Second Measurement Period is less than the minimum EBITDA
requirements set forth above, the Borrower shall be deemed to be in compliance
with the above requirements for such period if no later than 90 days after the
end of the First Measurement Period or the Second Measurement Period, as
applicable, the Investor Group provides cash equity (the "EBITDA Cure Amount")
to the Borrower in an amount equal to or greater than the difference between the
(i) $20,000,000 for the First Measurement Period or $30,000,000 for the Second
Measurement Period, as applicable and (ii) the actual EBITDA for such period.
(c) Notwithstanding the above, in the event that a Terrorist Event
Period occurs during any of the EBITDA measurement periods set forth in clause
(a) above, and in the event the Borrower provides the Agent with documentation
satisfactory to the Agent demonstrating that the Borrower was reasonably likely
to be in compliance with the minimum EBITDA requirement set forth above for such
period prior to the occurrence of the Terrorist Event, then the minimum EBITDA
requirement for such period shall be the result of (x) the minimum EBITDA amount
set forth above for such period, multiplied by (y) 1 - m/12, where "m" equals
the number of calendar months in the Terrorist Event Period that occur during
such EBITDA measurement period.
8.14 Interest Coverage Ratio. (a) The Borrower will not permit the
Interest Coverage Ratio for any period ending on a Fiscal Quarter set forth
below to be less than the ratio set forth below opposite such Fiscal Quarter:
Four consecutive Fiscal Quarter
Period period ending on the last day of: Ratio
------ -------------------------------- -----
Fourth Measurement
Period FQ 13 1.95:1.00
FQ 14 1.97:1.00
FQ 15 1.98:1.00
FQ 16 2.01:1.00
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Four consecutive Fiscal Quarter
Period period ending on the last day of: Ratio
------ -------------------------------- -----
Fifth Measurement
Period FQ 17 2.10:1.00
FQ 18 2.13:1.00
FQ 19 2.15:1.00
FQ 20 2.17:1.00
Sixth Measurement
Period FQ 21 2.28:1.00
FQ 22 2.37:1.00
FQ 23 2.52:1.00
FQ 24 2.71:1.00
(b) Notwithstanding the above, in the event that a Terrorist Event
occurred during any of the Interest Coverage Ratio measurement periods set forth
in clause (a) above, and in the event the Borrower provides the Agent with
documentation satisfactory to the Agent demonstrating that the Borrower was
reasonably likely to be in compliance with the Interest Coverage Ratio
requirement set forth above for such period prior to the occurrence of the
Terrorist Event, the Interest Coverage Ratio requirement shall be suspended
solely in the period(s) during which the Terrorist Event Period continues.
8.15 Leverage Ratio. (a) The Borrower will not permit the Leverage Ratio
for any period ending on a Fiscal Quarter set forth below to be greater than the
ratio set forth below opposite such Fiscal Quarter:
Four consecutive Fiscal Quarter
Period period ending on the last day of: Ratio
------ --------------------------------- -----
Fourth Measurement
Period FQ 13 7.00:1.00
FQ 14 6.68:1.00
FQ 15 6.56:1.00
FQ 16 6.24:1.00
Fifth Measurement
Period FQ 17 5.93:1.00
FQ 18 5.63:1.00
FQ 19 5.52:1.00
FQ 20 5.23:1.00
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Four consecutive Fiscal Quarter
Period period ending on the last day of: Ratio
------ --------------------------------- -----
Sixth Measurement
Period FQ 21 4.96:1.00
FQ 22 4.67:1.00
FQ 23 4.56:1.00
FQ 24 4.30:1.00
(b) Notwithstanding the above, in the event that a Terrorist Event
occurred during any of the Leverage Ratio measurement periods set forth in
clause (a) above, and in the event the Borrower provides the Agent with
documentation satisfactory to the Agent demonstrating that the Borrower was
reasonably likely to be in compliance with the Leverage Ratio requirement set
forth above for such period prior to the occurrence of the Terrorist Event, the
Leverage Ratio requirement shall be suspended solely in the period(s) during
which the Terrorist Event Period continues.
8.16 Negative Pledge Clauses. Enter into or suffer to exist or become
effective any agreement which prohibits or limits the ability of the Borrower or
any of its Subsidiaries to create, incur, assume or suffer to exist the Liens
upon the Collateral contemplated by the Loan Documents, to secure the
Obligations or, in the case of any Guarantor, its obligations under the Security
Agreement or hereunder, other than (a) this Agreement and the other Loan
Documents, (b) any agreements governing Permitted Liens, but only to the extent
of the Property subject to such Permitted Liens and (c) in the case of Holdings,
the Mezzanine Loan Documents (subject to the Mezzanine Intercreditor Agreement).
8.17 Restrictions on Subsidiary Distributions. Enter into or suffer to
exist or become effective any consensual encumbrance or restriction on the
ability of any Subsidiary to (a) make Distributions in respect of any Equity
Interests of such Subsidiary held by, or pay any Debt owed to, the Borrower or
any other Subsidiary, or (b) make investments in the Borrower or any other
Subsidiary, except for such encumbrances or restrictions existing under or by
reason of any restrictions existing under the Loan Documents.
8.18 Confirmation Order. At any time seek or consent to any material
modification, stay, vacation or amendment of the Confirmation Order, except for
those mutually agreed to by the Borrower and the Required Lenders.
8.19 Easements. Grant any easements or licenses for utilities, roads or
any other purposes over, under or on any portion of the Premises other than as
required in the REA or the Parking Agreement without the prior written consent
of Agent (unless granting any such easement or license would not reasonably be
expected to result in a Material Adverse Effect), which consent shall not be
unreasonably withheld or delayed.
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8.20 Changes in Zoning. Request or seek to obtain any change to, or
consent to any request for or change in, any Legal Requirement, restrictive
covenant or other restriction applicable to the Premises or any portion thereof
or any other law, ordinance, rule, regulation, restrictive covenant or
restriction affecting the zoning, development or use of the Premises or any
portion thereof, or any variance or special exception therefrom, unless any such
change would not reasonably be expected to result in a Material Adverse Effect.
Notwithstanding the foregoing, any changes, consents, variances or other matters
concerning the Gaming Licenses or Gaming Laws shall require the prior written
consent of the Agent.
8.21 ERISA. (a) To the extent any of the following would reasonably be
expected to have a Material Adverse Effect, engage in any transaction in
connection with which the Borrower or any ERISA Affiliate could be subject to
either a material civil penalty assessed pursuant to the provisions of Section
502 of ERISA or a material tax imposed under the provisions of Section 4975 of
the Code.
(b) Terminate any Pension Plan in a "distress termination" under
Section 4041 of ERISA, or take any other action which could result in a material
liability of the Borrower or any ERISA Affiliate to the PBGC.
(c) Fail to make payment when due of all amounts which, under the
provisions of any Plan, the Borrower or any ERISA Affiliate is required to pay
as contributions thereto, or, with respect to any Pension Plan, permit to exist
any material "accumulated funding deficiency" (within the meaning of Section 302
of ERISA and Section 412 of the Code), whether or not waived, with respect
thereto.
(d) Adopt an amendment to any Pension Plan requiring the provision
of security under Section 307 of ERISA or Section 401(a)(29) of the Code.
8.22 Organizational Documents. Amend, modify, restate or supplement any
material provision of any Organizational Document of the Borrower or Holdings
without the prior written consent of Required Lenders (including without
limitation the provisions authorizing the appointment of a representative of the
Lenders on any board of directors or managers or other advisory position) other
than as required by Gaming Laws.
8.23 Development Agreement with respect to Time Share Premises. (a) Enter
into a development or operation agreement with respect to the Time Share
Premises, make any Plans and Specifications with respect to the Time Share
Premises or select a Developer (as defined below) unless, in each case the Agent
(acting upon the direction of the Required Term Loan A Lenders (other than the
FF&E Lender)) shall have reasonably approved in writing such development
agreement, Plans and Specifications and Developer. Any such development
agreement shall include the following terms (or other terms reasonably
satisfactory the Required Term Loan A Lenders (other than the FF&E Lender)): (i)
the Borrower shall have a contractual right to receive 50% of all fees paid to
or received by or on behalf of Holdings, the Borrower or any of their respective
Subsidiaries, collectively, or to which Holdings, the Borrower or any of their
respective Subsidiaries, collectively, are entitled to receive from, one or more
time share operators or developers (collectively, the "Developers") in respect
of net timeshare sales (net of
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cancellations and defaults) from any time share project, or any similar fees in
connection with another development such as a hotel, condominium or condo-hotel
by a Developer on the Time Share Premises (the "Marketing Fees") and (ii) the
Developer shall agree to deposit, when due, the Marketing Fees payable to the
Borrower directly into an account of the Borrower subject to a deposit account
control agreement in favor of the Agent (and in form and substance reasonably
satisfactory to the Agent)(2); and such development agreement or Plans and
Specifications shall have been delivered to the Agent prior to their execution
or finalization as required by Section 7.2(o)) or (b) amend, modify, restate or
supplement any material provision of any such development agreement or Plans and
Specifications without the prior written consent of the Required Term Loan A
Lenders (other than the FF&E Lender).
8.24 Management Agreement; Casino Operator Agreement. Enter into any
Management Agreement or any agreement relating to the operation of the Casino
without the prior written consent of the Required Lenders (which consent shall
not be unreasonably withheld or delayed).
8.25 Adverse Contracts. Enter into any contract or agreement which, at the
time it was entered into, is reasonably likely to materially and adversely
affect the Premises or the Borrower's business, property, assets, operations,
prospects, or condition (financial or otherwise) taken as a whole, or its
ability to perform its obligations under this Agreement or any of the other Loan
Documents.
8.26 Management of the Borrower. (a) Permit any member or principal of the
Investor Group to hold the position of Chief Executive Officer, Chief Financial
Officer, Chief Operating Officer or President of the Borrower or (b) hire or
agree to hire any Chief Financial Officer, Chief Operating Officer or President,
in each case without the consent of the Agent and the Required Lenders, which
consent shall not be unreasonably withheld or delayed.
8.27 Maximum Operating Cash Reserve Amount. Permit the Operating Cash
Reserve Amount to be increased except as set forth in the immediately succeeding
sentence. The Operating Cash Reserve Amount may be increased by (i) $3,000,000
following the first four successive Fiscal Quarters in which EBITDA is at least
$50,000,000, (ii) an additional $3,000,000 following the first four successive
Fiscal Quarters in which EBITDA is at least $60,000,000, (iii) an additional
$3,000,000 following the first four successive Fiscal Quarters in which EBITDA
is at least $70,000,000, and (iv) an additional $3,500,000 following the first
four successive Fiscal Quarters in which EBITDA is at least $80,000,000;
provided, that the Borrower at all times shall be allowed to maintain any cash
reserves required under Gaming Laws regardless of the provisions of this Section
8.27 which cash reserves shall be funded solely by equity from the Investor
Group to the extent that the Gaming Laws require the minimum cash reserve to be
in an amount which exceeds the Operating Cash Reserve Amount pursuant to this
Section 8.27.
--------------------
(2) For the avoidance of doubt, nothing in this Section 8.23(a)(ii) will
require any Developer to pay more than 50% of the Marketing Fees to the
Borrower.
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8.28 Plan of Reorganization. (a) Cause the Plan of Reorganization to be
amended or modified in any material respects or consent to the Plan of
Reorganization being amended or modified in any material respects or (b) waive
any of the conditions contained therein if the effect of such waiver would be
reasonably likely to result in a Material Adverse Effect.
8.29 Maintenance of Operating Cash Reserve Amount. Permit the Operating
Cash Reserve Amount at any time to be less than the minimum amount required by
Gaming Laws.
8.30 Time Share Entity. (a) Enter into a joint venture agreement or other
organizational agreement with respect to the development or operation of the
Time Share Premises unless the Agent shall have determined that any such
agreement is reasonably satisfactory in form and substance to the Required Term
Loan A Lenders (other than the FF&E Lender) (including, without limitation, the
holders of the Equity Interests of such joint venture and the percentages of
equity owned by each such holder and the economic interests of each such holder)
and any such agreement shall have been delivered to the Agent prior to its
execution as required by Section 7.2(o)) or (b) amend, modify, restate or
supplement any material provision of any such joint venture or other agreement
without the prior written consent of the Agent (acting at the reasonable
direction of the Required Term Loan A Lenders (other than the FF&E Lender)).
8.31 Payments with respect to Time Share Premises. Enter nor permit the
Bay Harbour Investor or any Affiliate thereof, the Xxxx Investor or any
Affiliate thereof or any Affiliate of the Borrower (other than Holdings) to
enter into any agreement or arrangement that provides for any such Person to
receive any payments of any nature or kind with respect to the Time Share
Premises other than payments that are approved in writing by the Agent (acting
at the reasonable direction of the Required Term Loan A Lenders (other than the
FF&E Lender)).
8.32 Rates for Hotel Usage by the Time Share Entity. Shall not permit or
allow any complementary or reduced rates or services of the Hotel Premises or
the Casino in connection with the development, management, ownership, sales or
operation of the Time Share Premises except as approved in writing by the Agent
(acting at the reasonable direction of the Required Term Loan A Lenders.
8.33 Intentionally Omitted.
8.34 Limited Activities. Except for obligations or liabilities (i)
incurred in connection with its formation, (ii) contained in or expressly
permitted by the Loan Documents (including the issuance of the Mezzanine Loan)
or (iii) related to reporting obligations under the Exchange Act (including the
rules and regulations of the SEC) and other applicable law, or (iv) incurred by
the Holdings in connection with the development or operation of Time Share
Premises, none of BH/RE, EquityCo or Holdings will incur, directly or
indirectly, any material obligations or liabilities or will engage in any
material business activities of any type or kind whatsoever.
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8.35 Leases at Shopping Mall f/k/a Desert Passage. The Borrower shall not
become a lessee under any lease (or enter into any easement, license or similar
arrangement granting the right to use or occupancy) with respect to the shopping
mall f/k/a Desert Passage adjoining the Premises that is a Material Operating
Agreement unless the Agent shall have approved the terms and conditions of any
such lease (which approval shall not be unreasonably withheld or delayed) and
the Borrower shall have first used its reasonable best efforts to obtain and
deliver to the Agent an executed estoppel and deed of trust (or have used its
reasonable best efforts to provide other documentation reasonably satisfactory
to the Agent that grants the Agent substantially the same rights and remedies as
a deed of trust or otherwise provides the Agent the right to succeed to the
rights of the Borrower under any such lease or other arrangement), in each such
case in form and substance reasonably acceptable to the Agent, with respect to
such lease or other interest (it being understood that for purposes of this
Section 8.35, any lease for space (or any easement, license or similar
arrangement granting the right to use or occupancy) that is used in connection
with the re-configuration or re-theming of the Premises or is otherwise a means
of ingress or egress to the Premises shall be deemed to be a Material Operating
Agreement).
ARTICLE 9
DEFAULT; REMEDIES
9.1 Events of Default. It shall constitute an event of default ("Event of
Default") if any one or more of the following shall occur for any reason:
(a) (i) any failure to make any payment of principal on any of the
Loans or (ii) any failure to make any payment of interest, fees or premium on
any of the Loans or any other Obligations (other than an amount referred to in
clause (i) above) when due and such failure shall continue for five or more
days;
(b) any representation or warranty made by the Borrower or any other
Loan Party in this Agreement, any of the other Loan Documents, any financial
statement, or any certificate furnished by or on behalf of the Borrower or any
other Loan Party at any time to the Agent or any Lender shall prove to be untrue
in any material respect as of the date when made or furnished or deemed to have
been made or furnished;
(c) (i) default shall occur in the observance or performance of any
of the covenants and agreements contained in this Agreement (other than those
which are the subject of clauses (a) and (b) above or clause (c)(ii), (iii) or
(iv) below or otherwise specified in this Section 9.1), or in any of the Term
Loan Notes or the other Loan Documents and the Borrower shall fail to remedy
such default within a period of thirty (30) days after it occurs or if any such
agreement or document shall terminate (other than in accordance with its terms
or the terms hereof or with the written consent of the Agent) or become void or
unenforceable without the written consent of the Agent; (ii) any default shall
occur in the observance of any covenant contained in Section 7.1(d), 7.3, 7.5,
7.8, 7.13, 7.25, 7.30 or Article 8, (iii) any default shall occur in the
observance of any covenant contained in Section 7.16 and the Borrower shall fail
to remedy such default within a period of ten (10) days after it occurs, or (iv)
any default shall occur in the
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observance of any covenant contained in Section 7.2 or 7.32 and the Borrower
shall fail to remedy such default within a period of five (5) Business Days
after it occurs;
(d) any default by the Borrower or any other Loan Party in any
payment of principal of or interest on any Debt for borrowed money in an
aggregate amount in excess of $5,000,000 (other than the Obligations and the
Mezzanine Loan which is covered by clause (r) below) beyond any period of grace
provided with respect thereto, or (unless the subject of a good faith dispute)
in the performance of any other agreement, term or condition contained in any
agreement under which any such Debt is created, if the effect of such default is
to cause, or permit the holder or holders of such obligation to declare, such
Debt to become due prior to its stated maturity, unless such default has been
waived by the holder or the holders of such Debt or cured prior to acceleration
under Section 9.2;
(e) (i) the Borrower or any other Loan Party shall (x) be unable to
pay its debts generally as they become due, (y) make an assignment for the
benefit of its creditors, or (z) file a petition or application, or an answer,
or otherwise commence a proceeding, under any applicable law or statute of the
United States of America, any state thereof or any foreign country (other than
under the Bankruptcy Code), seeking reorganization or arrangement or similar
relief or otherwise to take advantage of any insolvency act, or for the
appointment of a receiver, trustee, liquidator or conservator of itself or of
the whole or any substantial part of its Property; (ii) there is commenced
against the Borrower or any other Loan Party any proceeding for any of the
relief described in clause (i)(z) above and such proceeding shall remain
undismissed and unstayed for a 60 day period; (iii) the Borrower or any other
Loan Party by any act in any such proceeding indicates its consent to or
approval of or acquiescence in such relief; or (iv) the Borrower or any other
Loan Party takes any action for the purpose of effecting any of the foregoing;
(f) (i) the Borrower or any other Loan Party shall commence a
voluntary case concerning itself under the Bankruptcy Code; (ii) there is
commenced against the Borrower or any other Loan Party an involuntary case under
the Bankruptcy Code and such proceeding shall remain undismissed and unstayed
for a 60 day period; or (iii) the Borrower or any other Loan Party by any act in
any such proceeding indicates its consent to, approval of or acquiescence in
such relief;
(g) (i) a court of competent jurisdiction shall enter (other than
under the Bankruptcy Code) an order, judgment or decree appointing a custodian,
receiver, trustee, liquidator or conservator of the Borrower or any other Loan
Party or of the whole or any substantial part of its Property, or (ii) under the
provisions of any law for the relief or aid of debtors other than the Bankruptcy
Code, a court of competent jurisdiction shall assume custody or control of the
Borrower or any other Loan Party or of the whole or any substantial part of its
Properties;
(h) the Borrower or any other Loan Party shall file a certificate of
dissolution under applicable state law or shall be liquidated, dissolved or
wound-up or shall commence any action or proceeding for dissolution, winding-up
or liquidation, or shall take any corporate action in furtherance thereof, in
each case, except as permitted by Section 8.1; or the Borrower or any other Loan
Party shall have commenced against it any action or proceeding for dissolution,
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winding-up or liquidation, not otherwise permitted hereunder;
(i) all or any substantial part of the Property of the Borrower or
any other Loan Party shall be nationalized, expropriated or condemned, seized or
otherwise appropriated, or custody or control of such Property or of the
Borrower or any other Loan Party shall be assumed by any Governmental Authority
or any court of competent jurisdiction at the instance of any Governmental
Authority, except where contested in good faith by proper proceedings diligently
pursued and where a stay of enforcement is in effect;
(j) any judgment in excess of $5,000,000 (in excess of insurance
coverage) is rendered against the Borrower or any other Loan Party, or there is
any attachment, injunction or execution against the Borrower or any other Loan
Party Property for an amount in excess of $5,000,000, unless such judgment,
attachment, injunction or execution is paid, stayed or dismissed within a period
of thirty (30) days after the first date on which the judgment creditor is
entitled to exercise its rights and remedies with respect to such judgment,
attachment, injunction or execution;
(k) any loss, theft, damage or destruction of any item or items of
Collateral occurs which: (i) causes a Material Adverse Effect; or (ii) is in
excess of $5,000,000 and is not adequately covered by insurance;
(l) any Gaming License shall be modified, refused, suspended,
revoked or canceled or allowed to lapse or if a notice of a material violation
is issued under any Gaming License by the issuing agency or other Governmental
Authority having jurisdiction, or any proceeding is commenced by any
Governmental Authority for the purpose of modifying in any materially adverse
respect, suspending, revoking or canceling any Gaming License in any materially
adverse respect, or any Governmental Authority shall have appointed a
conservator, supervisor or trustee to the Casino;
(m) a Change of Control occurs;
(n) (i) a Reportable Event shall have occurred with respect to a
Pension Plan, (ii) the filing by the Borrower, any ERISA Affiliate, or an
administrator of any Plan of a notice of intent to terminate such a Plan in a
"distress termination" under the provisions of Section 4041 of ERISA, (iii) the
receipt of notice by the Borrower, any ERISA Affiliate, or an administrator of a
Plan that the PBGC has instituted proceedings to terminate (or appoint a trustee
to administer) such a Pension Plan, (iv) any other event or condition exists
which might, in the opinion of the Agent, constitute grounds under the
provisions of Section 4042 of ERISA for the termination of (or the appointment
of a trustee to administer) any Pension Plan by the PBGC, (v) a Pension Plan
shall fail to maintain the minimum funding standard required by Section 412 of
the Code for any plan year or a waiver of such standard is sought or granted
under the provisions of Section 412(d) of the Code, (vi) the Borrower or any
ERISA Affiliate has incurred, or is likely to incur, a liability under the
provisions of Section 4062, 4063, 4064 or 4201 of ERISA, (vii) the Borrower or
any ERISA Affiliate fails to pay the full amount of an installment required
under Section 412(m) of the Code, (viii) the occurrence of any other event or
condition with respect to any Plan which would constitute an event of default
under any other agreement entered into by the Borrower or
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any ERISA Affiliate, and in each case in clauses (i) through (viii) of this
subsection (n), such event or condition, together with all other such events or
conditions, if any, could subject the Borrower or any ERISA Affiliate to any
taxes, penalties or other liabilities which would reasonably be expected to have
a Material Adverse Effect;
(o) the Borrower or any ERISA Affiliate (i) shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred any material
withdrawal liability to such Multiemployer Plan, and (ii) does not have
reasonable grounds for contesting such withdrawal liability and is not in fact
contesting such withdrawal liability in a timely and appropriate manner which
would reasonably be expected to have a Material Adverse Effect;
(p) the Confirmation Order shall have been modified in any respect
without the prior written consent of the Agent or a determination shall have
been made regarding the Confirmation Order that is adverse in any respect to the
Agent and the Lenders;
(q) this Agreement, any Term Loan Note, any of the Security
Documents or other Loan Documents shall for any reason cease to be, or shall be
asserted by any Loan Party not to be, a legal, valid and binding obligation of
any Loan Party, enforceable in accordance with its terms, or the security
interest or Lien purported to be created by any of the Security Documents shall,
for any reason other than as a result of any action or inaction by the Agent,
any Lender or any representative thereof, cease to be, or be asserted by any
Loan Party not to be, a valid, first priority perfected security interest in any
Collateral (except to the extent otherwise permitted under this Agreement or any
of the Security Documents);
(r) the provisions of the Mezzanine Intercreditor Agreement shall
for any reason be revoked or invalidated or the validity or enforceability
thereof shall be contested in any proceeding by or on behalf of any Mezzanine
Lender or a default, event of default or a breach of any of the terms shall
occur and be continuing under any Mezzanine Loan Document;
(s) any default by any Loan Party not cured within any applicable
cure period under any of the Energy Services Agreement, the Energy Premises
Lease, the Parking Agreement or the REA the result of which is the loss to any
Loan Party of any benefits material to the operation of the Premises as
determined by the Agent in its reasonable discretion;
(t) any material default by Borrower under any Management Agreement
not cured within any applicable cure period thereunder or termination of any
Manager and failure to replace such Manager with an Identified Hotel Manager or
another manager satisfactory to Agent within thirty (30) days following the
termination of any such manager; or
(u) the License Agreement shall be terminated for any reason or
there shall be a default by any party to the License Agreement which is not
cured within any applicable cure period thereunder.
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9.2 Remedies. (a) (x) If an Event of Default shall occur under Section
9.1(f), all Obligations shall become immediately due and payable without any
action by the Agent, and (y) if any other Event of Default shall have occurred
and be continuing, the Agent may, and it shall, at the request of the Required
Term Loan A Lenders and if the Term Loan A has been paid in full, at the request
of the Required Term Loan B Lenders, without notice to or demand on the
Borrower, do one or more of the following at any time or times thereafter and in
any order: (i) terminate this Agreement in accordance with Article 10; (ii)
declare any or all Obligations to be immediately due and payable; and (iii)
pursue its other rights and remedies under the Loan Documents and applicable
law.
(b) If an Event of Default shall have occurred and be continuing,
the Borrower hereby waives (to the extent permitted under applicable law) all
rights to notice and hearing prior to the exercise by the Agent of the Agent's
rights to repossess the Collateral without judicial process or to replevy,
attach or levy upon the Collateral without notice or hearing (to the extent
permitted under applicable law).
(c) At any time upon the occurrence and during the continuance of
any Event of Default, Agent shall have the right, in addition to any other
rights or remedies of Agent hereunder or under the Mortgage or the other Loan
Documents, but not the obligation, in its own name or in the name of the
Borrower, to enter into possession of all or any portion of the Premises, to
perform all work necessary to complete the construction, reconstruction,
maintenance or renovation of or to operate all or any portion of the Premises
and to employ watchmen and other safeguards to protect the Collateral. The
Borrower hereby appoints Agent as the attorney-in-fact of the Borrower (coupled
with a interest), with full power of substitution, and in the name of the
Borrower, if Agent elects to do so, at any time upon the occurrence and during
the continuance of any Event of Default, (a) to use such sums as are necessary
to make such alterations, repairs and renovations to all or any portion of the
Premises and to employ such architects, engineers and contractors as may be
required for the purpose of completing any construction, reconstruction,
maintenance or renovation of all or any portion of the Premises as Agent may
determine or to operate the Premises or any portion thereof, (b) to execute all
applications and certificates which may be required for the alteration, repair
or renovation of or the completion of construction, reconstruction, maintenance
or renovation of all or any portion of the Premises or for the operation of the
Premises or any portion thereof, (c) to endorse the name of the Borrower on any
checks or drafts representing proceeds of insurance policies or condemnation
awards, or other checks or instruments payable to the Borrower with respect to
the Premises, (d) to do every act with respect to the alteration, repair or
renovation of or the construction, repair, maintenance and operation of the
Premises or any portion thereof which the Borrower otherwise may do, (e) to
prosecute or defend any action or proceeding incident to the Premises, (f) to
enforce or exercise any of the Borrower's rights or benefits under the Leases,
(g) to terminate any contract pertaining to the Premises to which the Borrower
is party, and (h) to negotiate and execute, on behalf of the Borrower, any
Lease, Management Agreement or Leasing Services Agreement or amendment,
modification, extension or supplement to any Lease, Management Agreement or
Leasing Services Agreement. The power-of-attorney granted hereby is a power
coupled with an interest and is irrevocable. Agent shall have no obligation to
undertake any of the foregoing actions, and if Agent should do so, it shall have
no liability to the Borrower for the sufficiency or adequacy of any such actions
taken by Agent, except with respect to liability arising from Lender's gross
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negligence or willful misconduct.
Notwithstanding the foregoing, it is expressly understood that Agent
assumes no liability or responsibility for (i) performance of any duties of the
Borrower hereunder or under any of the Loan Documents, (ii) compliance with any
applicable Legal Requirements, any Permitted Liens, any Lease, any Management
Agreement, any Operating Agreement or any Leasing Services Agreement, or (iii)
any other matters pertaining to control over the management and affairs of the
Borrower, nor by any such action shall Agent or Lenders be deemed to create a
partnership or joint venture with the Borrower.
(d) Upon the occurrence and during the continuance of any Event of
Default, in addition to any other rights or remedies of Agent hereunder or under
the other Loan Documents, Agent may exercise any rights and remedies available
to the Agent pursuant to the Subordination Agreements, including the termination
of the License Agreement (subject to the terms and conditions of the License
Subordination Agreement and License Agreement), any Management Agreement
(subject to the terms and conditions of the Manager Subordination Agreement) or
any Leasing Services Agreement as referred to therein and/or may require that
the Borrower exercise any rights and remedies available to the Borrower pursuant
to the License Agreement, any Management Agreement or any Leasing Services
Agreement, including the termination of such agreements to the extent such
termination is then permitted pursuant to the terms thereof. Upon a foreclosure
or deed in lieu of foreclosure with respect to all or any portion of the
Premises, Agent shall have the right to terminate the License Agreement, any
Management Agreement or any Leasing Services Agreement or exercise any other
rights and remedies pursuant to and as and upon the terms described in the
License Agreement, any Management Agreement or the Leasing Services Agreement
and the Subordination Agreements.
(e) Any funds of Agent or Lenders used for any purpose referred to
in this Article 9 shall constitute a portion of the Obligations, shall bear
interest from the date advanced at the Initial Default Rate or the Subsequent
Default Rate, as applicable, shall be secured pursuant to the Loan Documents by
all collateral thereunder and shall be due and payable upon demand.
(f) If Borrower has failed to keep or perform any covenant or
obligation whatsoever contained in any Loan Document beyond the expiration of
any applicable notice and cure period, in addition to any other rights or
remedies of Agent hereunder or under the other Loan Documents, Agent may, but
shall not be obligated to any Person to, perform or attempt to perform said
covenant or obligation, and any payment made or expense incurred in the
performance or attempted performance of any such covenant or obligation shall be
a part of the Obligations, and Borrower shall pay to Agent, upon demand, all
sums so advanced or paid by Agent, together with interest at the Initial Default
Rate or the Subsequent Default Rate, as applicable, from the date when paid by
Agent. No such payment by Agent shall constitute a waiver of any Event of
Default. In addition to the Liens created pursuant to the Loan Documents, Agent
shall be subrogated to all rights, titles, liens, and security interests
securing the payment of any debt, claim, tax or assessment for the payment of
which Agent may make an advance or which Agent may pay.
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9.3 Application of Proceeds of Collateral and Guaranty Agreements. After
the occurrence of an Event of Default and acceleration of the Obligations as
provided in this Article 9, the proceeds of the Collateral and collections from
each Guarantor shall be applied by the Agent to payment of the Obligations in
the following order, unless a court of competent jurisdiction shall otherwise
direct:
first, to payment of all costs and expenses of the Agent incurred in
connection with the preservation, collection and enforcement of the Obligations,
the Loan Documents, the Collateral, or otherwise, including, without limitation,
any amounts advanced by the Agent to protect or preserve the Collateral;
second, to payment of all reasonable costs and expenses of the Term Loan A
Lenders, incurred in connection with the preservation, collection and
enforcement of the Obligations, the Loan Documents or the Collateral;
third, pro rata to the payment in full of (i) principal and interest in
respect of the Term Loan A outstanding (pro rata as among the Term Loan A
Lenders in accordance with the amounts of the Term Loan A held by them) and (ii)
all unpaid Hedge Obligations of the Borrower under any Hedging Agreement
relating to the Term Loan A;
fourth, pro rata to the payment in full of all Obligations (other than
those referred to above) owed to the Term Loan A Lenders (pro rata as among the
Term Loan A Lenders in accordance to with the amounts of the Term Loan A held by
them);
fifth, to payment of all reasonable costs and expenses of the Term Loan B
Lenders, incurred in connection with the preservation, collection and
enforcement of the Obligations, the Loan Documents or the Collateral;
sixth, pro rata to the payment in full of (i) principal and interest in
respect of the Term Loan B outstanding (pro rata as among the Term Loan B
Lenders in accordance with the amounts of the Term Loan B held by them) and (ii)
all unpaid Hedge Obligations of the Borrower under any Hedging Agreement
relating to the Term Loan B;
seventh, pro rata to the payment in full of all Obligations (other than
those referred to above) owed to the Term Loan B Lenders (pro rata as among the
Term Loan B Lenders in accordance to with the amounts of the Term Loan B made by
them); and
eighth, the balance, if any, after all of the Obligations has been
satisfied, shall be paid by the Agent to the Borrower or paid over to such other
Person or Persons as may be required by law.
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ARTICLE 10
TERMINATION OF AGREEMENT
10.1 Termination Date. Unless sooner terminated as provided in Section 9.2
or 10.2 hereof, this Agreement shall terminate (subject to Section 10.4) on the
Termination Date.
10.2 Termination by the Borrower. At any time, the Borrower may terminate
this Agreement upon (i) the delivery to the Agent of an irrevocable notice of
its intention to terminate this Agreement and (ii) payment in full of all the
Obligations.
10.3 Termination by the Required Term Loan A Lenders. The Agent may, and
it shall at the request of the Required Term Loan A Lenders and after the Term
Loan A has been paid in full at the request of the Required Term Loan B Lenders,
terminate this Agreement immediately at any time during the continuance of an
Event of Default under Section 9.1.
10.4 Obligations. The termination of this Agreement shall not affect any
rights of the Borrower, the Agent or any Lender arising prior to the effective
date of such termination, and the provisions hereof shall continue to be fully
operative until all transactions entered into, rights created or Obligations
incurred prior to and after such termination have been fully disposed of,
concluded or liquidated. At the termination of this Agreement, all Obligations
then outstanding under this Agreement shall be due and payable without notice or
demand. The Security Interest granted to the Agent under the Security Agreement
and under the other Loan Documents shall continue in full force and effect,
notwithstanding the termination of this Agreement or the fact that the
Borrower's loan accounts may from time to time be temporarily in a credit
position, until all of the Obligations have been paid in full after the
termination hereof. All representations, warranties, covenants, waivers and
agreements contained herein shall survive the termination hereof until all
Obligations have been paid in full.
ARTICLE 11
MISCELLANEOUS
11.1 Cumulative Remedies; No Prior Recourse to Collateral. The enumeration
herein of the Agent's and the Lenders' rights and remedies is not intended to be
exclusive, and such rights and remedies are in addition to and not by way of
limitation of any other rights or remedies that the Agent or any of the Lenders
may have under the UCC or other applicable law. The Agent and the Lenders shall
have the right, in their sole discretion, and in the manner set forth in this
Agreement, to determine which rights and remedies are to be exercised and in
which order. The exercise of one right or remedy shall not preclude the exercise
of any others, all of which shall be cumulative. The Agent and the Lenders may,
without limitation, proceed directly against the Borrower to collect the
Obligations without any prior recourse to the Collateral.
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11.2 No Implied Waivers. No act, failure or delay by the Agent or any
Lender, or any course of dealing, shall constitute a waiver of any of its rights
and remedies. No single or partial waiver by the Agent or any Lender of any
provision of this Agreement or any other Loan Document, or a breach or default
hereunder or thereunder, or of any right or remedy which the Agent or any Lender
may have, shall operate as a waiver of any other provision, breach, default,
right or remedy or of the same provision, breach, default, right or remedy on a
future occasion. No waiver by the Agent or the Lenders shall affect their rights
to require strict performance of this Agreement or any other Loan Document.
11.3 Severability. If any provision of this Agreement shall be prohibited
or invalid, under applicable law, it shall be ineffective only to such extent,
without invalidating the remainder of this Agreement.
11.4 Governing Law. THIS AGREEMENT, IN ACCORDANCE WITH SECTION 5-1401 OF
THE GENERAL OBLIGATION LAW OF THE STATE OF NEW YORK, SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO ANY CONFLICTS OF LAWS PRINCIPLES THEREOF THAT WOULD CALL FOR THE APPLICATION
OF THE LAWS OF ANY OTHER JURISDICTION.
11.5 Consent to Jurisdiction and Venue; Service of Process. The Borrower
agrees that, in addition to any other courts that may have jurisdiction under
applicable laws, any action or proceeding to enforce or arising out of this
Agreement or any of the other Loan Documents may be commenced in the Supreme
Court of the State of New York for New York County, or in the United States
District Court for the Southern District of New York, and the Borrower consents
and submits in advance to such jurisdiction and agrees that venue will be proper
in such courts on any such matter. The Borrower hereby waives personal service
of process and agrees that a summons and complaint commencing an action or
proceeding in any such court shall be properly served and shall confer personal
jurisdiction if served by registered or certified mail to the Borrower. The
consent to forum set forth in this Section shall not be deemed to preclude the
enforcement of any judgment obtained in such forum, or the taking of any action
under this Agreement to enforce the same, in any appropriate jurisdiction. The
Borrower waives any objection it may now or hereafter have to the laying of
venue in the foregoing courts or that any such action has been brought in an
inconvenient forum.
11.6 Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH
OF THE PARTIES HERETO HEREBY WAIVES TRIAL BY JURY, RIGHTS OF SETOFF, AND THE
RIGHT TO IMPOSE COUNTERCLAIMS (OTHER THAN COMPULSORY COUNTERCLAIMS) IN ANY
LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF
THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, THE OBLIGATIONS OR THE COLLATERAL, OR
ANY INSTRUMENT OR DOCUMENT DELIVERED PURSUANT HERETO OR THERETO. EACH OF THE
PARTIES HERETO CONFIRMS THAT THE FOREGOING WAIVERS ARE INFORMED AND FREELY MADE.
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11.7 Survival of Representations and Warranties and Indemnification. All
of the Borrower's representations and warranties and indemnifications contained
in this Agreement shall survive the execution, delivery and acceptance thereof
by the parties, notwithstanding any investigation by the Agent or any Lender or
their respective agents.
11.8 Indemnification. The Borrower hereby agrees to indemnify, defend and
hold the Agent, each Lender, and their respective directors, officers, agents,
employees and counsel (each an "Indemnitee" and collectively, the
"Indemnitees"), harmless from and against any and all losses, claims, damages,
liabilities, deficiencies, judgments, penalties or expenses imposed on, incurred
by or asserted against any of them (except as a result of their gross negligence
or wilful misconduct or a claim against a Lender or the Agent by another Lender
or the Agent), whether direct, indirect or consequential, arising out of or by
reason of any litigation, investigation, claim, or proceeding (whether based on
any federal, state or local laws or other statutes or regulations, including,
without limitation, securities or commercial laws and regulations, Environmental
Laws, under common law or at equity, or on contract or otherwise) commenced or
threatened, which arise out of or are in any way related to or based upon (i)
the breach by the Borrower or its Subsidiaries of any of the terms of the Loan
Documents, (ii) any claim of injury or damage to Persons or property, which
injury or damage occurs after the Closing Date, or any other claim or demand the
underlying matter of which occurred after the Closing Date which in any way
relates to the Property, the Borrower, the Investor Group, or the Loan, or (iii)
any Hazardous Material on, in, under or emanating from the Premises, or
transported from the Premises or any act, omission to act, event or transaction
related or attendant thereto or any use by the Borrower of the proceeds of the
Term Loans (except for losses arising on account of the Indemnitee's gross
negligence or wilful misconduct or a claim against a Lender or the Agent by
another Lender or the Agent) (collectively, "Indemnified Loss"). Indemnified
Loss includes, without limitation, amounts paid in settlement, court costs, and
the reasonable fees and expenses of counsel reasonably incurred in connection
with any such litigation, investigation, claim or proceeding. Without limiting
the foregoing, if, by reason of any suit or proceeding of any kind, nature, or
description against the Borrower or any Subsidiary, or by the Borrower or any
Subsidiary or any other party against any Indemnitee, which in the reasonable
discretion of such Person makes it advisable for such Person to seek counsel for
protection and preservation of its Security Interest, or to defend its own
interest, such expenses and reasonable counsel fees shall be allowed to such
Person, to the extent that the underlying matter gives rise to an indemnity
under this Section 11.8; provided, however, that the Borrower shall be required
to pay the reasonable attorneys' fees and expenses of one counsel for the Term
Loan A Lenders and one counsel for the Term Loan B Lenders, but subject to any
limitations or requirements set forth elsewhere in this Agreement. To the extent
that the undertaking to indemnify, pay and hold harmless set forth in this
Section may be unenforceable, the Borrower shall contribute the maximum portion
which it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of the Indemnified Loss. The foregoing indemnity shall survive the
payment of the Obligations and the termination of this Agreement. The Borrower's
obligations under this Section shall be part of the Obligations and shall be
secured by the Collateral. The Borrower shall have the right to defend, with
counsel reasonably acceptable to the applicable Indemnitee, against any
litigation, investigation, claim or proceeding which could give rise to an
Indemnified Loss, unless such litigation, investigation, claim or proceeding
shall have been commenced by or on behalf of the Borrower. The Agent and each
Lender agrees to give the Borrower written notice of any such litigation,
investigation, claim, or proceeding
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promptly after the Agent or such Lender becomes aware thereof, but the Agent's
or such Lender's failure to give such notice shall not relieve the Borrower of
its obligations under this Section unless it can be proved that the Borrower or
any of its Subsidiaries and Affiliates were actually prejudiced by such failure.
The Borrower, if it exercises such right, shall diligently pursue such defense
and shall give the applicable Indemnitee notice of the status of such defense
and any material developments. The Borrower will not enter into any settlement
of any litigation, investigation, claim or proceeding in which they are
conducting the defense without the prior written consent of the applicable
Indemnitee, which consent shall not be unreasonably withheld.
11.9 Other Security and Guaranties. The Agent may, on behalf of the
Lenders, without notice or demand and without affecting the Borrower's
obligations hereunder, from time to time: (a) take from any Person other than
the Borrower and/or Guarantor and hold collateral for the payment of all or any
part of the Obligations and exchange, enforce or release such collateral or any
part thereof; and (b) accept and hold any endorsement or guaranty of payment of
all or any part of the Obligations and release any such endorser or Guarantor,
or any Person who has given any Lien in any other collateral as security for the
payment of all or any part of the Obligations, or any other Person in any way
obligated to pay all or any part of the Obligations.
11.10 Fees and Expenses. The Borrower shall pay to the Agent, within
thirty (30) days after receipt of a written invoice with details of such costs,
expenses and advances, all reasonable out-of-pocket costs, expenses and advances
that the Agent or any one representative of the Term Loan A Lenders or any one
representative of the Term Loan B Lenders (provided, that at any time after an
Event of Default shall be continuing the Borrower shall be liable for costs and
expenses of each Lender), pays or incurs in connection with the administration
of this Agreement and the other Loan Documents, or that the Agent or any
representative of the Term Loan A Lenders or Term Loan B Lenders (provided, that
at any time after an Event of Default shall be continuing the Borrower shall be
liable for costs and expenses of each Lender) incurs in connection with
enforcement hereof and thereof or the collection of the Obligations, including,
without limitation: (a) reasonable attorneys' and paralegals' fees and
disbursements of counsel to the Term Loan A Lenders or Term Loan B Lenders,
which shall include, without limitation, the reasonable costs and expenses of
Agent's and Lenders' counsel and advisors in connection with the (i) negotiation
and preparation of any amendments and modifications to this Agreement from the
July 2003 draft of this Agreement and (ii) negotiation of the Mezzanine Loan
Documents but shall exclude attorneys' and paralegals' fees and disbursements
incurred in connection with the negotiation, preparation or consummation of the
Loan Documents; (b) reasonable costs and expenses (including reasonable
attorneys' and paralegals' fees and disbursements) for any amendment,
supplement, waiver, consent, or subsequent closing in connection with the Loan
Documents and the transactions contemplated thereby; (c) all reasonable costs
and expenses relating to any tax, lien, UCC, and municipal, departmental,
bankruptcy, judgment, title searches and rating of the Term Loan A Notes
requested by Agent; (d) taxes and reasonable fees and other charges paid by the
Agent or the representative of the Term Loan A Lenders or Term Loan B Lenders
(provided, that at any time after an Event of Default shall be continuing the
Borrower shall be liable for costs and expenses of each Lender) for filing
financing statements and continuation statements, and other actions to perfect,
protect, and continue the Security Interest; (e) sums paid or incurred to pay
any amount or take any action required of the Borrower or any other Loan Party
after the Closing Date under the Loan Documents that such Loan Party fails to
pay or take; (f) reasonable
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costs of Appraisals (other than the FF&E Lender Appraisal); (g) costs of
inspections, and verifications of the Collateral, including, without limitation,
travel, lodging, and meals for inspections of the Collateral and the Borrower's
operations by the Agent's employees or representatives; (h) costs and expenses
of forwarding loan proceeds, collecting checks and other items of payment, and
establishing and maintaining Accounts; (i) reasonable costs and expenses of
preserving and protecting the Collateral; (j) reasonable costs and expenses
payable by or chargeable to any Loan Party under any Loan Document; (k)
reasonable costs and expenses (including reasonable attorneys' and paralegals'
fees and disbursements) paid or incurred to obtain payment of the Obligations,
enforce the Security Interest, sell or otherwise realize upon the Collateral,
and otherwise enforce the provisions of the Loan Documents, or to defend any
claims made or threatened against the Agent or any Lender arising out of the
transactions contemplated hereby (including, without limitation, preparations
for and consultations concerning any such matters); (l) all title insurance and
title examination charges, including premiums for the Title Insurance Policy to
the extent not paid by Aladdin; (m) all survey costs and expenses, including the
cost of the Survey to the extent not paid by Aladdin; (n) all premiums for the
Insurance Policies, (o) from and after the occurrence of an Event or Event of
Default or as may otherwise be required under Section 7.7 of this Agreement, all
costs and expenses of any engineering or environmental audits or insurance
reviews reasonably required by the Agent, (p) in the event the Premises, or any
portion thereof, shall be advertised for foreclosure sale and not sold, all
costs in connection therewith, including reasonable attorneys' fees and
disbursements, advertising costs and trustees' commission, (q) other costs and
expenses incurred in connection with syndication of the Loan by any Lender, (r)
all other costs and expenses payable to third parties which are incurred by
Agent or the representative of the Term Loan A Lenders or the Term Loan B
Lenders in connection with the Loan, if incurred after the Closing Date
(provided that, notwithstanding clause (r) the Borrower shall pay the
reasonable costs and expenses of Agent's and Lenders' counsel and advisors in
connection with the (i) negotiation and preparation of any amendments and
modifications to this Agreement from the July 2003 draft of this Agreement and
(ii) the negotiation of the Mezzanine Loan Documents) and (s) the fees and
expenses incurred by the representative of the Lenders to obtain approval by the
Gaming Authorities in order to serve on the board of directors or managers of
the Borrower or in a comparable position as required under Section 5.1(q). Any
of the foregoing costs, expenses and advances may be charged to the Borrower's
loan account pursuant to Section 2.7: when paid or incurred, if any Event of
Default has occurred and is continuing; or, otherwise, thirty (30) days after
the Agent's demand on the Borrower for payment thereof, together with an invoice
with details of such costs, expenses and advances to the extent not paid by the
Borrower within such 30-day period. The Borrower shall pay from its equity all
of its costs, expenses and advances in connection with the negotiation,
preparation and consummation of this Agreement and the transactions contemplated
hereunder.
11.11 Notices. All notices, demands, requests and other communication that
a party is required or elects to give to any other party shall be in writing,
shall be delivered (a) personally against receipt, or sent by recognized
overnight courier service, or mailed by registered or certified mail, return
receipt requested, postage prepaid, or (b) by facsimile, telecopier or other
telecommunications method, in each case with receipt confirmed and with a copy
delivered also under (a) above, and shall be addressed to the party to be
notified as follows:
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If to the Agent: The Bank of New York, Asset Solutions Division
000 Xxxx Xxx Xxxxxxx Xxxx.
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxx
Fax No.: 000.000.0000
with a copy to Risk Management at the above address
with a copy to
Xxxx Xxxxxxx LLP
0 Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000
70 West Madison Street, Chicago, Ill. 60602-4231,
Attention: Xxxxxxx Xxxxx, Esq.
and to
Xxxx Xxxxxxx LLP
1999 Avenue of the Stars, Xxxxx 0000
Xxx Xxxxxxx, XX 00000,
Attention: Xxxxxxx Xxxxxxx, Esq.
If to the Borrower: OpBiz, L.L.C.3667
Xxx Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Attention: Xxxxx Xxxxxxx
Fax No.: (000) 000-0000
with a copy to:
Bay Harbour Management, LC
000 Xxxxx Xxxxxx 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Fax No.: (000) 000-0000
and
Xxxxx Day
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Fax No.: 000-000-0000
117
If to a Lender: at its address set forth below its name on Annex A hereto
with a copy to
Xxxx Xxxxxxx LLP,
0 Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000,
70 West Madison Street,
Chicago, Ill. 60602-4231311,
Attention: Xxxxxxx Xxxxx, Esq.,
and to
Xxxx Xxxxxxx LLP,
0000 Xxxxxx xx xxx Xxxxx, Xxxxx 0000,
Xxx Xxxxxxx, XX 00000,
Attention: Xxxxxxx Xxxxxxx, Esq.
or to such other address as each party may designate for itself by like
notice. Any such notice, demand, request or other communication shall be deemed
given (i) when received, if personally delivered or sent by overnight courier,
(ii) four days after being sent when deposited in the United States mails,
postage paid, if sent by registered or certified mail, or (iii) when receipt is
acknowledged or is confirmed when delivered by facsimile, telecopier or other
communications method.
11.12 Waiver of Notices. Unless otherwise expressly provided herein, the
Borrower waives presentment, protest and notice of demand or dishonor and
protest as to any instrument, as well as any and all other notices to which it
might otherwise be entitled. No notice to or demand on the Borrower which the
Agent or any Lender may elect to give shall entitle the Borrower to any or
further notice or demand in the same, similar or other circumstances.
11.13 Binding Effect; Assignment; Confidentiality. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns; provided, however, that no
right or obligation of the Borrower may be assigned or otherwise transferred
without the prior written consent of the Required Lenders, and any purported
assignment or transfer without such consent shall be void.
(b) A Lender may assign and delegate to any one or more banks or
other entities with the prior written consent of the Borrower which consent
shall not be unreasonably withheld or delayed (but no such consent shall be
required for assignments after the occurrence of an Event of Default or with
respect to Eligible Assignees) and with the written consent of the Agent, all or
a portion of its outstanding Term Loans A and Term Loans B and interests, rights
and obligations under this Agreement and the other Loan Documents. Each such
assignment pursuant to the immediately preceding sentence shall (i) be an
assignment of a constant and not a varying, ratable percentage of such Lender's
interest in the Loan, (ii) be in an aggregate principal amount of at least One
Million Dollars ($1,000,000) and (iii) only be permitted if the assigning
Lender's unassigned interest in the Loan shall be in a principal amount of at
least One Million Dollars ($1,000,000) after giving effect to such transaction
unless such transaction encompasses all of such Lender's rights in and to the
Loan in which case such Lender shall have assigned all of
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its rights in and to the Loan.
If any Lender so sells or assigns all or a part of its rights hereunder or
under the Term Loan Notes, any reference in this Agreement, the Term Loan Notes
or the other Loan Documents to such assigning Lender shall thereafter refer to
such Lender and to the respective assignee to the extent of their respective
interests, and the respective assignee shall have, to the extent of such
assignment (unless otherwise provided therein), the same rights and benefits as
it would if it were such assigning Lender. Each assignment pursuant to this
Section 11.13 shall be effected by the execution and delivery of an assignment
agreement substantially in the form of Exhibit I (which shall include, without
limitation, the provisions therein relating to the requirements of the Gaming
Authorities) hereto (an "Assignment Agreement"). In the event of any such
assignment either the assigning or the assignee Lender shall pay to the Agent a
nonrefundable assignment fee of $500 and, and at the time of any assignment
pursuant to this Section 11.13, (1) the signature pages hereof shall be deemed
to be amended to reflect the Commitment or Commitments of the respective
assignee (which shall result in a direct reduction to the respective Commitment
or Commitments of the assigning Lender) and of the other Lenders, and (2) such
assignee shall become a party to the Loan Documents as a Lender and such
assignee shall have, to the extent of such assignment, the rights, benefits and
obligations of a Lender under the Loan Documents. Each Lender and the Borrower
agree to execute such documents (including without limitation amendments to this
Agreement and the other Loan Documents) as shall be necessary to effect the
foregoing. Nothing in this Section 11.13(b) shall prevent or prohibit any Lender
from pledging its Term Loan Notes or Loans to a Federal Reserve Bank in support
of borrowings made by such Lender from such Federal Reserve Bank.
(c) Any Lender may at any time sell to one or more financial
institutions or other entities (a "Participating Lender") participating
interests in the Loans, the Term Loan Notes held by such Lender, the Commitment
of such Lender or any other interest of such Lender hereunder, provided,
however, that (i) such Lender's obligations under the Loan Documents shall
remain unchanged, (ii) such Lender shall remain solely responsible for the
performance of such obligations, (iii) the Participating Lender shall not have
any rights under the Loan Documents (the Participating Lender's rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the Participating Lender relating
thereto) and all amounts payable by the Borrower hereunder shall be determined
as if such Lender had not sold such participation, except that the participant
shall be entitled to the benefits of Sections 3.7 (Taxes) and 3.11 (Indemnity)
of this Agreement to the extent that the granting Lender would have been
entitled to such benefits if the participation had not been entered into or sold
(and accordingly, no Participating Lender shall be entitled to receive any
greater amount pursuant to such Sections than the granting Lender would have
been entitled to receive in respect of the amount of the participation granted
by such granting Lender to such Participating Lender had no such participation
been granted), (iv) the Borrower and the Agent shall continue to deal solely and
directly with such granting Lender in connection with such Lender's rights and
obligations under the Loan Documents, and (v) no Lender shall transfer or grant
any participating interest under which the Participating Lender shall have
rights to approve any amendment to, or any consent or waiver with respect to,
the Loan Documents except to the extent such amendment, consent or waiver would
require unanimous consent as described in Section 11.14. In the case of any
participation under this Section 11.13(c), the Participating Lender shall not
have any rights under
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the Loan Documents, and all amounts payable by the Borrower hereunder shall be
determined as if such Lender had not sold such participation, except that the
Borrower agrees that if amounts outstanding under this Agreement are due and
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of any Event of Default, each Participating Lender shall be
deemed to have the right of set-off in respect of its participating interest in
amounts owing under this Agreement to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under this
Agreement.
(d) Each Lender and the Agent agree to take normal and reasonable
precautions and exercise due care to maintain the confidentiality of all
non-public information provided to them by the Borrower, any Subsidiary of the
Borrower, any member of the Investor Group or any of their respective
Subsidiaries or Affiliates, or by the Agent on the Borrower's or Subsidiary's
behalf in connection with this Agreement or any Loan Document and agrees and
undertakes that neither they nor any of their Affiliates shall use any such
information for any purpose or in any manner other than pursuant to the terms
contemplated by this Agreement. Any Lender or the Agent may disclose such
information: (i) at the request of any bank regulatory authority or in
connection with an examination of such Lender by any such authority; (ii)
pursuant to subpoena or other court process; (iii) when required to do so in
accordance with the provisions of any applicable law; (iv) at the express
direction of any other agency of any State of the United States of America or of
any other jurisdiction in which such Lender conducts its business; and (v) to
such Lender's independent auditors and other professional advisors.
Notwithstanding the foregoing, the Borrower authorizes each Lender to disclose
to any permitted assignee or Participating Lender and any prospective permitted
assignee or Participating Lender such financial and other information in such
Lender's possession concerning the Borrower and its Subsidiaries which has been
delivered to the Lender pursuant to this Agreement or which has been delivered
to a Lender by the Borrower or the Agent in connection with the Lender's credit
evaluation of the Borrower prior to entering into this Agreement, provided that
such assignee or Participating Lender agrees in writing to such Lender and the
Borrower to keep such information confidential to the same extent required of
the Lenders hereunder. Notwithstanding anything to the contrary described
herein, from the commencement of discussions with respect to this Agreement and
the other Loan Documents, the parties hereto and each of their respective
employees, representatives or other agents, are, and hereby confirm that they
have been, permitted to disclose to any and all Persons, without limitations of
any kind, the tax treatment and tax structure of the transactions occurring
pursuant to this Agreement and all materials of any kind (including opinions or
other tax analyses) that are or have been provided to such parties related to
such tax treatment and tax structure.
11.14 Modification. (a) This Agreement and the Loan Documents are intended
by the Borrower, the Agent and the Lenders to be the final, complete, and
exclusive expression of the agreement between them. This Agreement supersedes
any and all prior oral or written agreements relating to the subject matter
hereof. Except as expressly set forth elsewhere in this Agreement, no amendment
or waiver of any provision of this Agreement or any Loan Document, and no
consent with respect to any departure by the Borrower therefrom, shall in any
event be effective unless the same shall be in writing and signed by the
Borrower and the Required Lenders, and then such waiver shall be effective only
in the specific instance and for the specific purpose for which given.
Notwithstanding any provision of this Section to the contrary, no waiver,
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amendment, or consent shall, unless in writing and signed by each Lender
affected thereby, increase the Commitment of any Lender or subject any Lender to
any additional obligations (except pursuant to an assignment by one Lender to
another Lender in accordance with the terms and provisions of this Agreement).
(b) In addition, notwithstanding any provision of this Section to
the contrary, no waiver, amendment, or consent shall, unless in writing and
signed by each Term Loan A Lender affected thereby, do any of the following:
(i) reduce the principal of, or the rate of interest on, any
Term Loan A or of any fees or other amounts payable hereunder or under any
Loan Document to any Term Loan A Lender;
(ii) change the percentage of the Term Loan A Commitments or
of the aggregate unpaid principal amount of the Term Loan A which shall be
required for the Term Loan A Lenders to take any action hereunder;
(iii) amend this Section 11.14, or the definitions of Required
Lenders and Required Term Loan A Lenders; and
(iv) release any material portion of the Collateral except as
otherwise provided herein or in any other Loan Documents;
(c) In addition, notwithstanding any provision of this Section to
the contrary, no waiver, amendment, or consent shall, unless in writing and
signed by each Term Loan B Lender affected thereby, do any of the following:
(i) reduce the principal of, or the rate of interest on, any
Term Loan B or of any fees or other amounts payable hereunder or under any
Loan Document to any Term Loan B Lender;
(ii) change the percentage of the Term Loan B Commitments or
of the aggregate unpaid principal amount of the Term Loan B which shall be
required for the Term Loan B Lenders to take any action hereunder;
(iii) amend this Section 11.14, or the definitions of Required
Lenders and Required Term Loan B Lenders; and
(iv) release any material portion of the Collateral except as
otherwise provided herein or in any other Loan Documents;
and provided, further, that no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Required Term Loan A Lenders
and Required Term Loan B Lenders, as the case may be, affect the rights or
duties of the Agent under this Agreement or any Loan Document. The parties
hereto agree that any provisions in this Agreement relating to the Time Share
Premises (including, without limitation, the Disposition or development or
operation
121
thereof and any joint venture or other agreement with respect thereto) that
requires consent or approval of the Lenders shall only require the consent or
approval of the Required Term Loan A Lenders (other than the FF&E Lender until
such time as the Initial Time Share Premises Payment is paid and thereafter the
consent or approval of all of the Required Term Loan A Lenders shall be
required).
11.15 Counterparts. This Agreement may be executed in any number of
counterparts, and by the Agent, each Lender and the Borrower in separate
counterparts, each of which shall be an original, but all of which shall
together constitute one and the same agreement. Execution of the signature page
or pages of any Loan Document by the Lenders, the Agent or any Loan Party and
the delivery of such page or pages to the Agent or its counsel by facsimile
shall be fully effective as if any such party had executed and delivered an
original counterpart of such Loan Document.
11.16 Captions. The captions contained in this Agreement are for
convenience only, are without substantive meaning and should not be construed to
modify, enlarge, or restrict any provision.
11.17 Right of Set-Off; Security Interest in Deposit Accounts. Without
limitation of any other or additional rights granted by applicable law, whenever
an Event of Default has occurred and is continuing, each Lender is hereby
authorized at any time and from time to time, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender or any Affiliate of
such Lender to or for the credit or the account of the Borrower or any Loan
Party (other than Holdings) (whether or not such deposits or other indebtedness
are then due and payable) against any and all of the Obligations (including
interests in obligations purchased by a Lender under Section 4.6), whether or
not then due and payable or contingent or unmatured. Each Lender agrees promptly
to notify the Borrower after any such set-off and application made by such
Lender, provided that the failure to give such notice shall not affect the
validity of such set-off and application. The Borrower and each Loan Party
(other than Holdings) hereby further grants the Agent and each Lender a security
interest in all deposits and accounts maintained with the Agent or such Lender
as security for the Obligations.
11.18 Limitation of Liability. (a) Notwithstanding anything to the
contrary contained in this Agreement, in the Term Loan Notes, the Mortgage or in
the other Loan Documents, no recourse shall be had for the payment of the
principal, interest or other amounts owed hereunder or under the Term Loan Notes
or the other Loan Documents, or for any claim based on this Agreement, the Term
Loan Notes or any other Loan Document, against any Member or any of its assets
(other than from the interest of such Member in the Borrower), or against any
principal, partner, member, shareholder, officer, director, agent or employee of
the Borrower or of any such Member (other than from the indirect interest of any
such Person in the Borrower), it being expressly understood that the sole
remedies of Agent and Lenders with respect to such amounts and claims shall be
against the assets of the Borrower, including the Mortgaged Property and other
Collateral; provided, however, that nothing contained in this Agreement
(including the provisions of this Section 11.18), the Term Loan Notes or the
other Loan Documents shall constitute a waiver of any of the Borrower's other
obligations herein, under the Term Loan Notes,
122
the Environmental Indemnity or any other Loan Documents.
11.19 Time Within Which to Consent to Certain Actions. Whenever this
Agreement requires the Required Lenders to consent to an action or proposed
action to be taken by the Borrower relating solely to a Material Operating
Agreement, unless this Agreement expressly provides otherwise, such consent (i)
shall not be unreasonably withheld or delayed and (ii) shall be deemed to have
been given by the Required Lenders if the Required Lenders have not responded to
the request for consent within 30 days of receipt thereof.
ARTICLE 12
THE AGENT
In order to accomplish the transactions contemplated by this Agreement,
The Bank of New York, Asset Solutions Division is hereby appointed to act as
Agent on behalf of the Lenders. Each of the Lenders and each subsequent holder
of any Term Loan Note by its acceptance thereof, irrevocably authorizes the
Agent to take such action on its behalf and to exercise such powers hereunder
and under the Security Documents and other Loan Documents as are specifically
delegated to or required of the Agent by the terms hereof and the terms thereof
together with such powers as are reasonably incidental thereto. Neither the
Agent nor any of its directors, officers, members, managers, employees or agents
shall be liable as such for any action taken or omitted to be taken by it or
them hereunder or under any of the Security Documents and other Loan Documents
or in connection herewith or therewith (a) at the direction, request or with the
approval of the Required Term Loan A Lenders (or in the event that the Term Loan
A is paid in full, the Required Term Loan B Lenders) or the Required Lenders, as
the context requires (or, if otherwise specifically required hereunder or
thereunder, the consent of all the Lenders, or all of the Term Loan A Lenders or
all of the Term Loan B Lenders) or (b) in the absence of its or their own gross
negligence or willful misconduct. The Agent shall not have or be deemed to have
any fiduciary duty to any Lender.
The Agent is hereby expressly authorized on behalf of the Lenders, without
hereby limiting any implied authority, (a) to receive on behalf of each of the
Lenders any payment of principal of or interest on the Term Loan Notes
outstanding hereunder and all other amounts accrued hereunder paid to the Agent,
and promptly to distribute to each Lender its proper share of all payments and
insurance proceeds so received, (b) to distribute to each Lender copies of all
notices, agreements and other material as provided for in this Agreement or in
the Security Documents and other Loan Documents as received by such Agent and
(c) to take all actions with respect to this Agreement and the Security
Documents and other Loan Documents as are specifically delegated to the Agent.
With respect to the release of Collateral, the Lenders hereby irrevocably
authorize the Agent to release any Lien granted to or held by the Agent upon any
property covered by this Agreement or the other Loan Documents (i) upon
termination or expiration of the Commitments, the payment and satisfaction of
all obligations arising with respect to the Term Loans, all fees and expenses,
or (ii) constituting property being sold or disposed of in compliance with the
provisions of the Loan Documents (and the Agent may rely in good faith
conclusively on any certificate
123
stating that the property is being sold or disposed of in compliance with the
provisions of the Loan Documents, without further inquiry); provided, however,
that (x) the Agent shall not be required to execute any release on terms which,
in the Agent's opinion, would expose the Agent to liability or create any
obligation or entail any consequence other than the release of such Liens
without recourse or warranty, and (y) such release shall not in any manner
discharge, affect or impair any Liens upon all interests retained, all of which
shall continue to constitute part of the property covered by the Loan Documents.
In the event that (a) the Borrower fails to pay when due the principal of
or interest on any Term Loan Note or any fee payable hereunder or (b) the Agent
receives written notice of or otherwise becomes aware of the occurrence of a
Default or an Event of Default, the Agent shall promptly give written notice
thereof to the Lenders, and shall take such action with respect to such Event of
Default or other condition or event as it shall be directed to take by the
Required Term Loan A Lenders (but shall not be required to take any such actions
which violate any law or any term of this Agreement or any other Loan Document);
provided, however, that, unless and until the Agent shall have received such
directions, the Agent may take such action or refrain from taking such action
hereunder or under the Security Documents or other Loan Documents with respect
to a Event or Event of Default as it shall deem advisable in the best interests
of the Lenders.
The Agent shall not be responsible in any manner to any of the Lenders for
the effectiveness, enforceability, perfection, value, genuineness, validity or
due execution of this Agreement, the Term Loan Notes or any of the other Loan
Documents or Collateral or any other agreements or certificates, requests,
financial statements, notices or opinions of counsel or for any recitals,
statements, warranties or representations contained herein or in any such
instrument or be under any obligation to ascertain or inquire as to the
performance or observance of any of the terms, provisions, covenants,
conditions, agreements or obligations of this Agreement or any of the other Loan
Documents or any other agreements on the part of the Borrower and, without
limiting the generality of the foregoing, the Agent shall, in the absence of
Knowledge to the contrary, be entitled to accept any certificate furnished
pursuant to this Agreement or any of the other Loan Documents as conclusive
evidence of the facts stated therein and shall be entitled to rely on any note,
notice, consent, certificate, affidavit, letter, telegram, teletype message,
statement, order or other document which it believes in good faith to be genuine
and correct and to have been signed or sent by the proper Person or Persons. It
is understood and agreed that the Agent may exercise its rights and powers under
other agreements and instruments to which it is or may be a party, and engage in
other transactions with the Borrower, as though it were not Agent of the Lenders
hereunder.
Neither the Agent nor any of its directors, officers, members, managers,
employees or agents shall have any responsibility to the Borrower on account of
the failure or delay in performance or breach by any Lender of any of its
obligations hereunder or to any Lender on account of the failure of or delay in
performance or breach by any other Lender or the Borrower of any of its
obligations hereunder or in connection herewith.
The Agent may consult with legal counsel selected by it in connection with
matters arising under this Agreement or any of the other Loan Documents and any
action taken or suffered in
124
good faith by it in accordance with the opinion of such counsel shall be full
justification and protection to it. The Agent may exercise any of its powers and
rights and perform any duty under this Agreement or any of the other Loan
Documents through agents or attorneys.
The Agent and the Borrower may deem and treat the payee of any Term Loan
Note as the holder thereof until written notice of transfer shall have been
delivered as provided herein by such payee to the Agent and the Borrower.
The Agent and/or its Affiliates may accept deposits from, lend money to
and generally engage in any kind of business with the Borrower, or other
affiliate thereof as if it were not the Agent.
Each Lender agrees (i) to reimburse the Agent in the amount of such
Lender's pro rata share (based on its Commitment hereunder) of any expenses
incurred for the benefit of the Lenders by the Agent, including counsel fees and
compensation of agents paid for services rendered on behalf of the Lenders, not
reimbursed by the Borrower and (ii) to indemnify and hold harmless the Agent and
any of its directors, officers, members, managers, employees or agents, on
demand, in the amount of its pro rata share, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against it or such directors, officers,
members, managers, employees or agents in its or their capacity as, or acting on
behalf of, the Agent in any way relating to or arising out of this Agreement or
any of the other Loan Documents or any action taken or omitted by it or any of
them under this Agreement or any of the other Loan Documents, to the extent not
reimbursed by the Borrower; provided, however, that no Lender shall be liable to
the Agent for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgment, suits, costs, expenses or disbursements resulting
from the gross negligence or willful misconduct of the Agent or any of its
directors, officers, employees or agents.
Each Lender acknowledges that it has, independently and without reliance
upon the Agent, or any Lender and based on such documents and information as it
has deemed appropriate, made its own credit analysis and decision to enter into
this Agreement and any other Loan Document to which such Lender is party. Each
Lender also acknowledges that it will, independently and without reliance upon
the Agent, or any Lender and based on such documents and information as it shall
deem appropriate at the time, continue to make its own decisions in taking or
not taking action under or based upon this Agreement, any other Loan Document,
any related agreement or any document furnished hereunder.
Subject to the appointment and acceptance of a successor Agent as provided
below, the Agent may resign at any time by notifying the Lenders and the
Borrower. Upon any such resignation, the Lenders shall have the right to appoint
a successor Agent. If no successor Agent shall have been so appointed by such
Lenders and shall have accepted such appointment within 30 days after the
retiring Agent gives notice of its resignation, then the retiring Agent may, on
behalf of the Lenders, and with the consent of the Borrower, which shall not be
unreasonably withheld or delayed, appoint a successor Agent which shall be a
bank or other financial institution with an office (or an Affiliate with an
office) in New York, New York, having a combined capital and
125
surplus of at least $500,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor bank, such successor shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent and the retiring Agent shall be discharged from its duties and
obligations hereunder and under each of the other Loan Documents. After any
Agent's resignation hereunder, the provisions of this Article shall continue in
effect for its benefit in respect of any actions taken or omitted to be taken by
it while it was acting as Agent.
The Lenders hereby acknowledge that the Agent shall be under no duty to
take any discretionary action permitted to be taken by the Agent pursuant to the
provisions of this Agreement or any of the other Loan Documents unless it shall
be requested in writing to do so by the Required Term Loan A Lenders or Required
Lenders, as the context so requires (and the Agent shall not be obligated to
take any such requested action which violates applicable law or any terms of
this Agreement or any other Loan Document).
ARTICLE 13
GUARANTEES
Each Guarantor party hereto unconditionally guarantees, as a primary
obligor and not merely as a surety, jointly and severally with each other
Guarantor party hereto, the due and punctual payment of the principal of and
interest on the Term Loans and of all other Obligations, when and as due,
whether at maturity, by acceleration, by notice or prepayment or otherwise. Each
Guarantor party hereto further agrees that the Obligations may be extended and
renewed, in whole or in part, without notice to or further assent from it, and
that it will remain bound upon its guarantee notwithstanding any extension or
renewal of any Obligations.
To the fullest extent permitted by law, each Guarantor party hereto waives
presentment to, demand of payment from and protest to the Borrower or any other
Person of any of the Obligations, and also waives notice of acceptance of its
guarantee and notice of protest for nonpayment. To the fullest extent permitted
by law, the obligations of a Guarantor party hereto hereunder shall not be
affected by (a) the failure of the Agent or any Lender to assert any claim or
demand or to enforce any right or remedy against the Borrower or any other
Guarantor under the provisions of this Agreement or any of the other Loan
Documents or otherwise; (b) any rescission, waiver, amendment or modification of
any of the terms or provisions of this Agreement, any of the other Loan
Documents, any guarantee or any other agreement; (c) the release of any security
held by the Agent or any Lender for the Obligations or any of them; or (d) the
failure of the Agent or any Lender to exercise any right or remedy against any
other Guarantor of the Obligations.
Each Guarantor party hereto further agrees that its guarantee constitutes
a guarantee of payment when due and not of collection, and waives any right to
require that any resort be had by the Agent or any Lender to any security (if
any) held for payment of the Obligations or to any balance of any deposit
account or credit on the books of the Agent or any Lender in favor of the
Borrower or any other Person.
To the fullest extent permitted by law, the obligations of each Guarantor
party hereto hereunder shall not be subject to any reduction, limitation,
impairment or termination for any
126
reason, including, without limitation, any claim of waiver, release, surrender,
alteration or compromise, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality or unenforceability of any of the Obligations or otherwise. Without
limiting the generality of the foregoing, to the fullest extent permitted by
law, the obligations of each Guarantor party hereto hereunder shall not be
discharged or impaired or otherwise affected by the failure of the Agent or any
Lender to assert any claim or demand or to enforce any remedy under this
Agreement or under any other Loan Document, any guarantee or any other
agreement, by any waiver or modification of any provision thereof, by any
default, failure or delay, willful or otherwise, in the performance of any of
the Obligations, or by any other act or omission which may or might in any
manner or to any extent vary the risk of such Guarantor or otherwise operate as
a discharge of such Guarantor as a matter of law or equity.
Each Guarantor party hereto further agrees that its guarantee shall remain
in full force and effect until the indefeasible payment and satisfaction in full
of the Obligations and the termination of the Commitments and shall continue to
be effective or be reinstated, as the case may be, if at any time payment, or
any part thereof, of principal or of interest on any Obligation or of any other
Obligation is rescinded or must otherwise be returned by the Agent or any Lender
upon the bankruptcy or reorganization of the Borrower, Guarantor or otherwise.
Until the Obligations are indefeasibly paid in full in cash, each
Guarantor party hereto hereby waives and releases all rights of subrogation
against each Loan Party and its property and all rights of indemnification,
contribution and reimbursement from each Loan Party and its property, in each
case in connection with this guarantee and any payments made hereunder, and
regardless of whether such rights arise by operation of law, pursuant to
contract or otherwise.
The parties hereto agree that for purposes of this Article 13, Holdings
shall not be deemed to be a Guarantor.
127
IN WITNESS WHEREOF, the parties hereto have caused this Loan Agreement
to be executed and delivered by their duly authorized officers as of the date
first above written.
OpBiz, L.L.C.,
a Nevada limited liability company,
as Borrower,
By: MezzCo, L.L.C.,
a Nevada limited liability company,
its sole member
By: EquityCo, L.L.C.,
a Nevada limited liability company,
its sole member
By: /s/ Xxxxxxx X. Xxxxxxxxxx
-------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Manager
THE BANK OF NEW YORK, ASSET
SOLUTIONS DIVISION, as Administrative
and Collateral Agent
By: /s/ [Illegible]
------------------------------------
Title:
Loan Agreement Signature Page
ALLSTATE LIFE INSURANCE
COMPANY,as a Term Loan A Lender and
as a Term Loan B Lender
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Authorized Signatory
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Authorized Signatory
Loan Agreement Signature Page
BDCM OPPORTUNITY FUND, L.P. by
Black Diamond Capital Management, L.L.C.
its General Partner, as a Term Loan A
Lender and as a Term Loan B Lender
By: /s/ Xxxxx X. Xxxxx, Xx.
-------------------------------------
Name: Xxxxx X. Xxxxx, Xx.
Title: President & Managing Partner
Black Diamond Capital
Management, L.L.C.
Loan Agreement Signature Page
XXXX SAVINGS BANK, as a Term Loan A
Lender and as a Term Loan B Lender
By:
_____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By: /s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
BEAR XXXXXXX INVESTMENT PRODUCTS, as a
Term Loan A Lender and as a Term Loan B
Lender
By: /s/ Xxxxxxxx Xxxxx
-------------------------------------
Name: Xxxxxxxx Xxxxx
Title: Authorized Signatory
Loan Agreement Signature Page
BLUE SQUARE FUNDING LIMITED SERIES 3, as
a Term Loan A Lender and as a Term Loan B
Lender
By:
_____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By:/s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT
SYSTEM, as a Term Loan A Lender and as a
Term Loan B Lender
By: Highland Capital Management, L.P. as
Authorized Representatives of the
Board
By:
_____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By: /s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
XXXXX XXX COMMERCIAL BANK, LTD., Los
Angeles Branch, as a Term Loan A Lender
and as a Term Loan B Lender
By: /s/ Xxx Xxxx
-------------------------------------
Name: Xxx Xxxx
Title: VP & General Manager
Loan Agreement Signature Page
COLUMBIA FLOATING RATE ADVANTAGE FUND, as
a Term Loan A Lender and as a Term Loan B
Lender
By: Highland Capital Management, L.P.,
its Investment Advisor
By:
_____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By:/s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
COLUMBIA FLOATING RATE LIMITED LIABILITY
COMPANY, as a Term Loan A Lender and as a
Term Loan B Lender
By: Highland Capital Management, L.P.,
its Investment Advisor
By:
_____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By:/s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
DB DISTRESSED OPPORTUNITIES FUND, LTD.,
as a Term Loan A Lender and as a Term
Loan B Lender
By:
_____________________________________
Name:
Title:
Loan Agreement Signature Page
DURANGO INVESTMENTS L.P., as a Term Loan
A Lender and as a Term Loan B Lender
By: /s/ L. Xxxxx Xxxx
-------------------------------------
Name: L. Xxxxx Xxxx
Title: President, Fountainhead Ltd.,
its General Partner
Loan Agreement Signature Page
ELF FUNDING TRUST I, as a Term Loan A
Lender and as a Term Loan B Lender
By:
_____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By:/s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
EPIC DISTRESSED DEBT OPPORTUNITY FUND,
L.P., as a Term Loan A Lender and as a
Term Loan B Lender
By: /s/ [Illegible]
_____________________________________
Name: [Illegible]
Title:
By: /s/ Xxxxxxx X. Self
-------------------------------------
Name: Xxxxxxx X. Self
Title:
Loan Agreement Signature Page
EVENT PARTNERS DEBT ACQUISITION, LLC, as
a Term Loan A Lender and as a Term Loan B
Lender
By:
_____________________________________
Name:
Title:
Loan Agreement Signature Page
GENERAL ELECTRIC CAPITAL CORPORATION, as
a Term Loan A Lender and as a Term Loan B
Lender
By: /s/ Xxxxxxxx Xxxx
-------------------------------------
Name: Xxxxxxxx Xxxx
Title: Senior Risk Manager
Loan Agreement Signature Page
GLENEAGLES TRADING LLC, as a Term Loan A
Lender and as a Term Loan B Lender
By:
-------------------------------------
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By: /s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
GMAC COMMERCIAL MORTGAGE
CORPORATION, as a Term Loan A Lender
and as a Term Loan B Lender
By: /s/ Xxxx X. Xxxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice-President
Loan Agreement Signature Page
HIGHLAND LEGACY LIMITED, as a
Term Loan A Lender and as a Term Loan B
Lender
By: Highland Capital Management, L.P. as
Collateral Manager
By:
----------------------------------------
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By: /s/ F. Xxxxxxx Xxxxxxxx, XX
-----------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
ING PRIME RATE TRUST, as a Term
Loan A Lender and as a Term Loan B
Lender
By: /s/ Xxxxx Xxxxx
----------------------------------------
Name: Xxxxx Xxxxx
Title: Vice President
Loan Agreement Signature Page
INTERNATIONAL COMMERCIAL BANK
OF CHINA, as a Term Loan A Lender and as
a Term Loan B Lender
By: /s/ Nae-Xxx Lung
----------------------------------------
Name: Nae-Xxx Lung
Title: SVP & General Manager
Loan Agreement Signature Page
XXXXXXXX MASTER FUND, LTD. as a
Term Loan A Lender and as a Term Loan B
Lender
By: /s/ [Illegible]
----------------------------------------
Name: [Illegible]
Title: Director
Loan Agreement Signature Page
LONG LANE MASTER TRUST IV-BLACK
DIAMOND, as a Term Loan A Lender and as
a Term Loan B Lender
By: /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Authorized Agent
Loan Agreement Signature Xxxx
XXXXXX XXXXXXX SENIOR FUNDING,
INC. as a Term Loan A Lender and as a Term
Loan B Lender
By: /s/ Xxxxxx Xxxxx
----------------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
Loan Agreement Signature Xxxx
XXXXXX XXXXXXX PRIME INCOME
TRUST, as a Term Loan A Lender and as a
Term Loan B Lender
By: /s/ Xxxxxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Authorized Signatory
Loan Agreement Signature Page
NUVEEN FLOATING RATE INCOME, as a
Term Loan A Lender and as a Term Loan B
Lender
By: /s/ Xxxxx Xxxxx
----------------------------------------
Name: Xxxxx Xxxxx
Title:
Loan Agreement Signature Page
NUVEEN SENIOR INCOME FUND, as a Term
Loan A Lender and as a Term Loan B
Lender
By: /s/ Xxxxx Xxxxx
____________________________________
Name: Xxxxx Xxxxx
Title:
Loan Agreement Signature Page
OCM REAL ESTATE OPPORTUNITIES FUND II,
L.P. (in its capacity as a FF&E Lender),
as Term Loan A Lender and as a Term Loan
B Lender
By: Oaktree Capital Management, LLC, its
General Partner
By: /s/ Xxxx Xxxxxxxx
------------------------------------
By: /s/ Xxxxx Xxxxx
------------------------------------
Loan Agreement Signature Page
OCM REAL ESTATE OPPORTUNITIES FUND II,
L.P. (but not in its capacity as a FF&E
Lender), as Term Loan A Lender and as a
Term Loan B Lender
By: Oaktree Capital Management, LLC, its
General Partner
By: /s/ Xxxx Xxxxxxxx
------------------------------------
By: /s/ Xxxxx Xxxxx
------------------------------------
Loan Agreement Signature Page
OCM REAL ESTATE OPPORTUNITIES FUND III,
L.P., as a Term Loan A Lender and as a
Term Loan B Lender
By: OCM Real Estate Opportunities Fund III
GP, LLC, its general partner
By: Oaktree Capital Management, LLC, its
Managing Member
By: /s/ Xxxx Xxxxxxxx
--------------------------------------
Name: Xxxx Xxxxxxxx
Title: Senior Vice President, Legal
By: /s/ Xxxxx Xxxxx
--------------------------------------
Name: Xxxxx Xxxxx
Title: Senior Vice President
Loan Agreement Signature Page
XXXXXXXXXXX SENIOR FLOATING RATE FUND,
as a Term Loan A Lender and as a Term
Loan B Lender
By: /s/ Xxxx Xxxxxxx
------------------------------------
Name: Xxxx Xxxxxxx
Title: Manager
Loan Agreement Signature Page
ORE HILL HUB FUND, LTD., as a Term Loan
A Lender and as a Term Loan B Lender
By: Ore Hill Partners, LLC
Its: Investment Advisor
By: /s/ Xxxxxxxxx Xxxx
------------------------------------
Name: Xxxxxxxxx Xxxx
Title: Managing Partner
Loan Agreement Signature Page
XXX CAPITAL FUNDING, L.P., as a Term
Loan A Lender and as a Term Loan B
Lender
By: Highland Capital Management, L.P. as
Collateral Manager
By:
____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By: /s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
POST OPPORTUNITY FUND, L.P., as a Term
Loan A Lender and as a Term Loan B
Lender
By:
____________________________________
Name:
Title:
The Bank of New York, Asset Solutions Division, as administrative and collateral
agent (signing in accordance with the Confirmation Order)
By: /s/ F. Xxxxxxx Xxxxxxxx, XX
---------------------------
Name: F. Xxxxxxx Xxxxxxxx, XX
Title: Director of Administrative Agent Services
Loan Agreement Signature Page
TACONIC CAPITAL PARTNERS 1.5 LP, as a
Term Loan A Lender and as a Term Loan B
Lender
By: /s/ Xxx Xxxxxxx
------------------------------------
Name: Xxx Xxxxxxx
Title: Principal
Loan Agreement Signature Page
THE BANK OF NOVA SCOTIA, as a Term Loan
A Lender and as a Term Loan B Lender
By: /s/ Xxxxx Xxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxx
Title: Director
Loan Agreement Signature Page
XXX XXXXXX CLO I, LIMITED, as a Term
Loan A Lender and as a Term Loan B
Lender
By: Xxx Xxxxxx Investment Advisory Corp.
As Collateral Manager
By: /s/ Xxxx Xxxxx
------------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
Loan Agreement Signature Page
XXX XXXXXX CLO II, LIMITED, as a Term
Loan A Lender and as a Term Loan B
Lender
By: Xxx Xxxxxx Investment Advisory Corp.
As Collateral Manager
By: /s/ Xxxx Xxxxx
------------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
Loan Agreement Signature Page
XXX XXXXXX SENIOR LOAN FUND, as a Term
Loan A Lender and as a Term Loan B
Lender
By: Xxx Xxxxxx Investment Advisory Corp.
By: /s/ Xxxx Xxxxx
------------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
Loan Agreement Signature Page
XXX XXXXXX SENIOR INCOME TRUST, as a
Term Loan A Lender and as a Term Loan B
Lender
By: Xxx Xxxxxx Investment Advisory Corp.
By: /s/ Xxxx Xxxxx
------------------------------------
Name: Xxxx Xxxxx
Title: Executive Director
Loan Agreement Signature Page
