SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "SECURITY AGREEMENT") is made and entered
into this 22nd day of August, 1996, between JEFFERSON CASINO CORPORATION, a
Louisiana corporation (the "DEBTOR"), and FIRST UNION BANK OF CONNECTICUT, a
Connecticut banking corporation, as trustee for the benefit of the holders of
the Notes (as defined below) (in such capacity, the "SECURED PARTY").
RECITALS
A. NOTES. Casino Magic of Louisiana, Inc., a Louisiana corporation
("BORROWER"), is the issuer of those certain $115,000,000 13 % First Mortgage
Notes due 2003 With Contingent Interest (the "Series A Notes, " and together
with any Series B Notes issued in exchange therefor, the "NOTES") pursuant to
that certain Indenture dated as of August 22, 1996 (the "INDENTURE"), by and
among Borrower, as issuer, Debtor, as guarantor, and Secured Party, as trustee
for the benefit of the holders of the Notes. Any capitalized term used in
this Security Agreement without definition, but defined in the Indenture,
shall have the same meaning here as in the Indenture. Debtor is entering into
this Security Agreement as security for, among other things, that certain
Guaranty (the "GUARANTY") set forth in the Indenture.
B. XXXXXXX.Xx a material inducement to Secured Party to enter into
the Indenture, Debtor has agreed to execute this Security Agreement in favor
of Secured Party and to pledge all its right, title and interest in the
collateral described herein to Secured Party.
AGREEMENT
Now therefore, in consideration of the above recitals and the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
1. Creation of Security Interest. Debtor hereby assigns, pledges
and grants to Secured Party, for the equal and ratable benefit of the Holders
of the Notes, a security interest in all of Debtor's right, title and interest
in and to the collateral described in Section 2 herein below (the
"Collateral") in each case whether now in existence or hereafter arising, now
owned or hereafter acquired by Debtor and wherever located, in order to secure
the payment and performance of the obligations of Debtor to Secured Party
described in Section 3 herein below.
2. COLLATERAL. The Collateral under this Security Agreement is:
(a) all of Debtor's personal property, goods, furnishings, fixtures and
equipment, supplies, building and other materials of every nature whatsoever
and all other personal property, including, but not limited to, communication
systems, visual and electronic surveillance systems and transportation systems
and including all property and materials stored therein in which Debtor has an
interest and all tools, utensils, food and beverage, liquor, uniforms, linens,
housekeeping and maintenance supplies, vehicles, fuel, advertising and
promotional material, blueprints, surveys, plans and other documents relating
to the Project, all gaming and general equipment and devices which are or are
to be installed and used in connection with the operation of Casino
Magic-Bossier City (the "PROJECT"), and the Vessels (as hereinafter defined),
all computer equipment, calculators, adding machines, and gaming tables, video
game and slot machines and any other electronic equipment, all furniture,
fixtures, equipment, gaming equipment, appurtenances and personal property now
or in the future contained in, used in connection with, attached to, or
otherwise useful or convenient to the use, operation, or occupancy of, or
placed on, but unattached to, any part of the Project or the land upon which
the Project will be constructed, including all removable window and floor
coverings, all furniture and furnishings, heating, lighting, plumbing,
ventilating, air conditioning, refrigerating, incinerating and elevator and
escalator plants, cooking facilities, vacuum cleaning systems, public address
and communications systems, sprinkler systems and other fire prevention and
extinguishing apparatus and materials, motors, machinery, pipes, appliances,
equipment, fittings, fixtures, and building materials, together with all
venetian blinds, shades, draperies, drapery and curtain rods, brackets, bulbs,
cleaning apparatus, mirrors, lamps, ornaments, cooling apparatus and
equipment, ranges and ovens, garbage disposals, dishwashers, mantels, and any
and all such property which is at any time installed in affixed to or placed
upon the land upon which the Project will be constructed, all fixtures for
generating or distributing air, water, heat, electricity, light, fuel or
refrigeration, or for ventilating or sanitary purposes, or for the exclusion
of vermin or insects, or for the removal of dust, refuse or garbage, all
specifically designed installations and furnishings, and all other personal
property, furniture, fixtures and equipment of every nature used or located at
the Project (all of the foregoing property and similar or after-acquired
property included as Collateral under Section 2(i) below being hereinafter
referred to as "EQUIPMENT");
(b) all of Debtor's accounts and accounts receivable, including, without
limitation, all rights to payment for goods sold or leased or for services
rendered which are not evidenced by an instrument or chattel paper, all other
present or future rights for money due or to become due, all of Debtor's
chattel paper, instruments, promissory notes (including, without limitation,
all inter-company notes), markers and general intangibles for money due or to
become due of any kind, in each case whether now existing or hereafter arising
and wherever arising and whether or not earned by performance and all
royalties, earnings, income, proceeds, products, rents, revenues, reversions,
remainders, issues, profits, avails, and other benefits directly or indirectly
derived or otherwise arising from any of the foregoing, (collectively, the
"RECEIVABLES"), other general intangibles, documents of title, warehouse
receipts, leases, deposit accounts, money, tax refund claims, partnership
interests, indemnification and other similar claims and contract rights,
permits and licenses, including, without limitation, any licenses held or to
be held by Debtor, franchises, variances, special permits, rulings,
validations, exemptions, filings, registrations, authorizations, consents,
approvals, waivers, orders, rights and agreements (including, without
limitation, options, option rights and contract rights) certificates, stock,
any and all books, records, customer lists, concession agreements, supply or
service contracts, documents, unearned premiums, rebates, deposits, refunds,
including, but not limited to, income tax rebates, prepaid expenses, rebates,
tax and insurance escrow and impound accounts, if any, and all rights in, to
and under all security agreements, mortgages, deeds of trust, guarantees,
leases and other agreements or contracts securing or otherwise relating to any
of the foregoing or now or hereafter obtained by Debtor from any Governmental
Authority having or claiming jurisdiction over the Project, and all things in
action, rights represented by judgments, awards of damages, settlements and
claims arising out of tort, warranty or contract (including, without
limitation, the right to assert and otherwise be the proper party of interest
to commence, control, prosecute and/or settle such actions, whether as claims,
counterclaims or otherwise, and whether involving matters arising from
casualty, condemnation, indemnification, negligence, strict liability, other
tort, contract, warranty or in any other manner), and all securities of any
Subsidiary, whether now in existence or hereafter incorporated or formed, (all
of the foregoing property, including, without limitation, the Receivables, and
similar or after-acquired property included as Collateral under Section 2(i)
below being hereinafter referred to as "INTANGIBLES");
(c) all of the trademarks and service marks now held or hereafter
acquired by Debtor or licensed to Debtor, which are registered in the United
States Patent and Trademark Office or in any similar office or agency of the
United States or any state thereof or any political subdivision thereof and
any application for such trademarks and service marks, as well as any
unregistered marks used by Debtor in the United States and trade dress
including logos, designs, trade names, business names, fictitious business
names and other business identifiers in connection with which any of these
registered or unregistered marks are used in the United States ("MARKS"),
together with the registration and right to renewals thereof, and the goodwill
of the business of Debtor symbolized by the Marks and all licenses associated
therewith;
(d) all United States copyrights which Debtor now or hereafter has
registered with the United States Copyright Office, as well as any application
for a United States copyright registration now or hereafter made with the
United States Copyright Office by Debtor ("COPYRIGHTS");
(e) all patents and patent applications, and any divisions or
continuations thereof, which are registered in the United States Patent and
Trademark Office or any similar office or agency of the United States or any
state thereof or political subdivision thereof ("PATENTS") together with the
registration and right to renewals, reissues and extensions thereof, and the
goodwill of the business of Debtor symbolized by the Patents;
(f) all computer programs of Debtor and all intellectual property
rights therein and all other proprietary information of Debtor, including, but
not limited to, trade secrets;
(g) all contract rights, warranty rights and other intangible rights
of the debtor of any kind pertaining to any and all riverboat gaming vessels
or other vessels now or hereafter owned by Debtor, including, without
limitation, any and all engines, boilers, machinery, components, gaming
equipment, masts, boats, capstans, outfit, tools, pumps, gear, furnishings,
appliances, fittings, spare and replacement parts and any and all other
appurtenances thereto or appertaining or belonging to any of the aforesaid
vessels, whether on board or not on board (collectively the "VESSELS"); and
(h) all of Debtor's right, title and interest in and to any and all maps,
plans, preliminary plans, specifications, surveys, studies, tests, reports,
data and drawings relating to the development of the Project including,
without limitation, all marketing plans, feasibility studies, soils tests,
design contracts and all contracts and agreements of Debtor relating thereto
including, without limitation, architectural, structural, mechanical and
engineering plans and specifications, studies, data and drawings prepared for
or relating to the development of the Project or the construction, renovation
or restoration of the Project as finalized, amended, supplemented, or
otherwise modified from time to time by 2nd Opinion, Inc., a Louisiana
corporation (the "INDEPENDENT CONSTRUCTION CONSULTANT"), in accordance with
the terms of the Cash Collateral and Disbursement Agreement, or the extraction
of minerals, sand, gravel or other valuable substances from the land upon
which the Project will be constructed and purchase contracts or any agreement
granting Debtor a right to acquire any land situated within the Parish of
Bossier, Louisiana, or the Parish of Caddo, Louisiana; and
(i) the Collateral includes all items described in this Section 2,
whether now owned or hereafter at any time acquired by Debtor and wherever
located, and includes all replacements, additions, parts, appurtenances,
accessions, substitutions, repairs, proceeds, products, offspring, rents and
profits, relating thereto or therefrom, and all documents, records, ledger
sheets and files of Debtor relating thereto ("PROCEEDS"). Proceeds hereunder
include (i) whatever is now or hereafter receivable or received by Debtor upon
the sale, exchange, collection or other disposition of any item of Collateral,
whether voluntary or involuntary, whether such proceeds constitute Equipment,
Intangibles, Vessels, Receivables or other assets; (ii) to the extent
permitted by law, whatever is now or hereafter receivable or received by
Debtor upon the sale, exchange, collection or other disposition of any Gaming
License; (iii) any such items which are now or hereafter acquired by Debtor
with any proceeds of Collateral hereunder; and (iv) any insurance or payments
under any indemnity, warranty or guaranty now or hereafter payable by reason
of loss or damage or otherwise with respect to any item of Collateral or any
proceeds thereof.
3. SECURED OBLIGATIONS OFDebtor. The Collateral secures and shall
hereafter secure (i) the payment by Debtor to the Holders or Secured Party of
all indebtedness now or hereafter owed to the Holders or Secured Party by
Debtor in connection with the transactions related to its Guaranty, the Notes
and the Indenture (the "BOSSIER CITY FINANCING"), whether at stated maturity,
by acceleration or otherwise, including, without limitation, Debtor's
obligations under the Indenture, the Notes, its Guaranty or any related
documents securing the obligations thereunder, together with any interest
thereon as provided therein, payments for early termination, fees, expenses,
increased costs, indemnification or otherwise, in connection therewith and
extensions, modifications and renewals thereof, (ii) the performance by Debtor
of all other obligations and the discharge of all other liabilities of Debtor
to the Holders or Secured Party of every kind and character arising from the
Bossier City Financing, whether direct or indirect, absolute or contingent,
due or to become due, now existing or hereafter arising, joint, several, joint
and several (i.e., soldiery), whether or not arising after the commencement of
a proceeding under Bankruptcy Law (including post-petition interest) and
whether or not recovery of any such obligation or liability may be barred by a
statute of limitations or prescriptive period or such obligation or liability
may otherwise be unenforceable, and whether created under this Security
Agreement or any other agreement to which Debtor and Secured Party are
parties, (iii) any and all sums advanced by Secured Party in order to preserve
the Collateral or preserve Secured Party's security interest in the Collateral
(or the priority thereof), and (iv) the expenses of retaking, holding,
preparing for sale or lease, selling or otherwise disposing of or realizing on
the Collateral, of any proceeding for the collection or enforcement of any
indebtedness, obligations or liabilities of Secured Party referred to above,
or of any exercise by Secured Party of its rights hereunder, together with
reasonable attorneys' fees and disbursements and court costs (collectively,
the "SECURED OBLIGATIONS"). All payments and performance by Debtor with
respect to any Secured Obligations shall be in accordance with the terms under
which said indebtedness, obligations and liabilities were or are hereafter
incurred or created.
4. DEBTOR'S REPRESENTATIONS AND WARRANTIES. Debtor represents and
warrants that:
(a) Debtor is (or, to the extent that the Collateral is acquired
after the date hereof, will be) the sole legal and beneficial owner of the
Collateral and has exclusive possession and control thereof; there are no
security interests in, Liens, charges or encumbrances on, or adverse claims of
title to, or any other interest whatsoever in, the Collateral or any portion
thereof except Liens that are created by this Security Agreement; and no
financing statement, notice of lien, mortgage, deed of trust or instrument
similar in effect covering the Collateral or any portion thereof ("LIEN
NOTICE") exists or is on file in any public office, and no Collateral or any
portion thereof is in the possession of any third party, except as relates to
Liens as may have been filed in favor of Secured Party relating to this
Security Agreement or related agreements, or for which duly executed
termination statements have been delivered to Secured Party for filing;
(b) Debtor has full right, power and authority to execute, deliver
and perform this Security Agreement. This Security Agreement constitutes a
legally valid and binding obligation of Debtor, enforceable against Debtor in
accordance with its terms. Subject to the completion of the items identified
in Section 4(c) below, the provisions of this Security Agreement are effective
to create in favor of Secured Party a valid and enforceable first, prior and
perfected security interest in the Collateral subject only to Permitted Liens;
(c) except for (i) the filing or recording of the financing
statements and fixture filings done concurrently with the execution and
delivery hereof, (ii) the actual taking of possession of instruments
constituting Collateral by the Trustee hereunder, if required by the Louisiana
Uniform Commercial Code, Commercial Laws - Secured Transactions, (iii) all
consents received and actions taken in connection with the closing of the
offering of the Notes, and (iv) any filings necessary to perfect Secured
Party's security interest in any Patent, Trademark or Copyright, no
authorization, approval or other action by, no notice to or registration or
filing with, any person or entity, including without limitation, any
stockholder or creditor of Debtor or any governmental authority or regulatory
body is required (x) for the grant by Debtor of the security interest in the
Collateral pursuant to this Security Agreement or for the execution, delivery
or performance of this Security Agreement by Debtor, (y) for the perfection or
maintenance of such security interest created hereby, including the first
priority nature of such security interest, or (except for notices required
under the Louisiana Uniform Commercial Code, Commercial Laws - Secured
Transactions) the exercise by Secured Party of the rights and remedies
provided for in this Security Agreement (other than any required governmental
consent or filing with respect to any Patents, Trademarks, Copyrights,
governmental claims, tax refunds, licenses or permits or the exercise of
remedies requiring prior court approval, notices, consents, approvals or
authorizations in connection with the sale of any securities under laws
affecting the offering and sale of securities generally), or (z) for the
enforceability of such security interest against third parties, including,
without limitation, judgment lien creditors;
(d) except as set forth on Exhibit "A" attached hereto, Debtor does
not do business, and for the previous five (5) years has not done business,
under any fictitious business names or trade names;
(e) the Collateral has not been and shall not be used or bought by
Debtor for personal, family or household purposes. In addition, the
Collateral does not include crops, timber, farm products, minerals or the like
or accounts resulting from the sale of such minerals at the wellhead or
minehead;
(f) Debtor's chief executive office is located at 0000 Xxx Xxxxxx
Xxxx, Xxxxxxx Xxxx, Xxxxxxxxx 00000, Debtor's federal tax identification
number is 000000000, and Debtor has no places of business other than such
address and the Collateral is now and shall at all times hereafter be located
at Debtor's places of business or as Debtor may otherwise notify Secured Party
in writing.,
(g) Debtor does not maintain any deposit accounts other than those
set forth in Exhibit "B" hereto and Debtor is not now indebted to any
organization with which Debtor maintains a deposit account;
(h) Debtor has not purchased any Collateral, other than for cash,
within twenty-one (21) days prior to the date hereof;
(i) all originals of all promissory notes, other instruments or
chattel paper which evidence Receivables (other than checks received by Debtor
in the ordinary course of business, which Debtor promptly shall deposit into
one of the deposit accounts encumbered hereunder) have been delivered to
Secured Party (with all necessary or appropriate endorsements);
(j) none of the execution, delivery and performance of this Security
Agreement by Debtor, the consummation of the transactions herein contemplated,
the fulfillment of the terms hereof or the exercise by Secured Party of any
rights or remedies hereunder shall constitute or result in a breach of any of
the terms or provisions of, or constitute a default under, or constitute an
event which with notice or lapse of time or both shall result in a breach of
or constitute a default under, any material agreement, or any indenture,
mortgage, deed of trust, equipment lease, instrument or other document to
which Debtor is a party, conflict with or require approval, authorization,
notice or consent under any material law, order, rule, regulation, license or
permit applicable to Debtor of any court or any federal or state government,
regulatory body or administrative agency, or any other governmental body
having jurisdiction over Debtor or its properties or require notice, consent,
approval or authorization by or registration or filing with any person or
entity (including, without limitation, any stockholder or creditor of Debtor)
other than (i) any notices to Debtor from Secured Party required hereunder,
(ii) notices and filings in connection with the perfection of Liens hereunder,
and (iii) notices, consents, approvals or authorizations in connection with
the sale of any securities under laws affecting the offering and sale of
securities generally. None of the Collateral is subject to any material
agreement, or any indenture, mortgage, deed of trust, equipment lease,
instrument or other document to which Debtor is a party which may restrict or
inhibit Secured Party's rights or ability to sell or dispose of the Collateral
or any part thereof after the occurrence of a Default or an Event of Default
(as defined herein);
(K) Debtor is the true lawful exclusive owner or licensee of the
Marks listed in Annex 1, except those listed as being held under a
non-exclusive license, and that said listed Marks include all the United
States federal registrations or applications registered in the United States
Patent and Trademark office and that said Marks are valid, subsisting and have
not been cancelled. Debtor represents and warrants that, except as indicated
on Annex 1, it owns or is licensed to use or not prohibited from using all
Marks that it uses. Debtor further warrants that, except as indicated on
Annex 1, it is aware of no third party claim that any aspect of Debtor's
present or contemplated business operations infringes or will infringe
Debtor's Marks. Debtor represents and warrants that it is the owner of record
of all United States registrations and applications listed in Annex 1 hereto
and that said registrations are valid, subsisting, have not been cancelled and
that such is not aware of any third party claim that any of said registrations
is invalid or unenforceable; and
(1) Debtor is the true and lawful exclusive owner of all rights in
the Patents listed in Annex 2 hereto and in the Copyrights listed in Annex 3
hereto, that said Patents include all the United States patents and
applications for United States patents that Debtor owns and that said
Copyrights constitute all the United States copyrights registered in the
United States Copyright Office and applications for United States copyrights
that it now uses or practices under. Debtor further warrants that it is aware
of no third party claim that any aspect of Debtor's present or contemplated
business operations infringes or will infringe any Patent or any Copyright.
5. COVENANTS OFDebtor. Debtor covenants and agrees that:
(a) Debtor shall not move or permit to be moved the Collateral or any
portion thereof to any location other than that set forth in Section 4(f)
hereof or the Project or locations established in compliance with Section 5(b)
hereof, in each case without the prior written consent of Secured Party, which
consent shall not be unreasonably withheld, and the prior filing of a
financing statement with the proper offices and in the proper form, to the
extent necessary or appropriate, to perfect or continue the perfection
(without loss of priority) of the security interests created herein, which
filing shall be satisfactory in form, substance and location to Secured Party
prior to such filing;
(b) Debtor shall not voluntarily or involuntarily change its name,
identity, corporate structure, or location of its chief executive office or
any of its other places of business, unless in any such case (i) Debtor shall
have first received the prior written consent of Secured Party, (ii) Debtor
shall have executed and caused to be filed financing statements with the
proper offices and in the proper form, to the extent necessary or appropriate,
to perfect or continue the perfection (without loss of priority) of the
security interests created herein, which filing shall be satisfactory in form,
substance and location to Secured Party prior to such filing, and (iii) Debtor
shall have delivered to Secured Party any other documents that may be required
by Secured Party in a form and substance reasonably satisfactory to Secured
Party to perfect or continue the perfection (without loss of priority) of the
security interest created herein;
(c) Debtor shall not establish or create any deposit accounts other
than those set forth in Exhibit "A" without the prior written consent of
Secured Party, and Debtor shall not hereafter incur any indebtedness to any
organization listed in said Exhibit "A";
(d) Debtor shall promptly, and in no event later than twenty-one (21)
days after a request by Secured Party, procure or execute and deliver all
further instruments and documents (including, without limitation, notices,
legal opinions, financing statements, mortgagee waivers, landlord disclaimers
and subordination agreements) satisfactory to Secured Party, and take any
other actions which are necessary or, in the judgment of Secured Party,
desirable or appropriate to perfect or to continue the perfection, priority
and enforceability of Secured Party's security interests in the Collateral, to
enable Secured Party to exercise and enforce its rights and remedies hereunder
with respect to any Collateral, to protect the Collateral against the rights,
claims or interests of third persons, or to effect or to assure further the
purposes and provisions of this Security Agreement, and shall pay all costs
incurred in connection therewith. Without limiting the generality of the
foregoing, Debtor shall: (i) xxxx conspicuously each item of chattel paper and
each other contract included in the Collateral with a legend, in form and
substance satisfactory to Secured Party, indicating that such chattel paper
and other contracts are subject to the security interests granted hereby; (ii)
execute and file such financing or continuation statements, or amendments
thereto, and such other instruments or notices as may be necessary or
desirable, which Secured Party may reasonably request in order to perfect and
preserve the perfection and priority of the security interests granted or
purported to be granted hereby; (iii) if any Receivable shall be evidenced by
a promissory note or other instrument or chattel paper (other than checks
received by Debtor in the ordinary course of business, which Debtor promptly
shall deposit into one of the deposit accounts encumbered hereunder), deliver
and pledge to Secured Party such note or instrument or chattel paper duly
endorsed and accompanied by duly executed instruments of transfer or
assignment, all in form-n and substance reasonably satisfactory to Secured
Party; (iv) if any Collateral is at any time in the possession or control of
any warehouseman, bailee, consignee or any of Debtor's agents or processors,
Debtor shall notify such warehouseman, bailee, consignee, agent or processor
of the security interests created or purported to be created hereby, shall
cause such warehouseman, bailee, consignee, agent or processor to execute any
financing statements or other documents which Secured Party may request, and,
upon the request of Secured Party after the occurrence and during the
continuation of a Default or an Event of Default, shall instruct such person
to hold all such Collateral for Secured Party's account subject to Secured
Party's instructions; (v) deliver and pledge to Secured Party all securities
and instruments (other than checks, received by Debtor in the ordinary course
of business, which Debtor promptly shall deposit into one of the deposit
accounts encumbered hereunder) constituting Collateral duly endorsed and
accompanied by duly executed instruments of transfer or assignment, all in
form and substance satisfactory to Secured Party; and (vi) at the request of
Secured Party, deliver to Secured Party any and all certificates of title,
applications for title or similar evidence of ownership of all Equipment and
shall cause Secured Party to be named as lienholder on any such certificate of
title or other evidence of ownership;
(e) Debtor shall not in any way encumber, or hypothecate, or create or
permit to exist, any Lien, security interest, charge or encumbrance or adverse
claim upon or other interest in the Collateral, including without limitation,
the liens created by this Security Agreement, and Debtor shall defend the
Collateral against all claims and demands of all persons at any time claiming
the same or any interest therein, except as expressly provided herein. Debtor
shall not permit any Lien Notices to exist or be on file in any public office
with respect to all or any portion of the Collateral except, in each case, for
Lien Notices of holders of Permitted Liens, including without limitation,
encumbrances permitted by the Indenture or except as may have been filed by or
for the benefit of Secured Party relating to this Security Agreement or
related agreements. Debtor shall promptly notify Secured Party of any
attachment or other legal process levied against any of the Collateral and any
information received by Debtor relative to the Collateral, which may in any
material way affect the value of the Collateral or the rights and remedies of
Secured Party in respect thereto;
(f) Debtor shall not sell, transfer, assign (by operation of law or
otherwise), exchange or otherwise dispose of all or any portion of the
Collateral or any interest therein. If the proceeds of any such prohibited
sale are notes, instruments, documents of title, letters of credit or chattel
paper, such proceeds shall be promptly delivered to Secured Party to be held
as Collateral hereunder (with all necessary or appropriate endorsements). If
the Collateral, or any part thereof or interest therein, is sold, transferred,
assigned, exchanged, or otherwise disposed of in violation of these
provisions, the security interest of Secured Party shall continue in such
Collateral or part thereof notwithstanding such sale, transfer, assignment,
exchange or other disposition, and Debtor shall hold the proceeds thereof in a
separate account for Secured Party's benefit. Debtor shall, at Secured
Party's request, transfer such proceeds to Secured Party in kind, with such
endorsements, if any, that Secured Party requires;
(g) Secured Party is hereby authorized to file one or more financing
statements or fixture filings, and continuations thereof and amendments
thereto, relative to all or any part of the Collateral, without the signature
of Debtor where permitted by law;
(h) Debtor shall not enter into any indenture, mortgage, deed of
trust, contract, undertaking, document, instrument or other agreement, except
for the Indenture and any documents, instruments or agreements related thereto
or issue any securities which may restrict or inhibit Secured Party's rights
or ability to sell or otherwise dispose of the Collateral or any part thereof
after the occurrence of a Default or an Event of Default;
(i) Debtor shall not enter into, modify or amend any existing or
future contracts or agreements relating to the sale or disposition of the
Collateral or any part thereof outside the ordinary course of business without
the prior written consent of Secured Party pursuant to the Indenture. Upon
request of Secured Party, Debtor shall provide Secured Party with copies of
all existing and hereafter created contracts and agreements pertaining to any
such sale or disposition and of all amendments and modifications thereto;
(j) Debtor shall pay and discharge all taxes, assessments and
governmental charges or levies against the Collateral prior to delinquency
thereof and shall keep the Collateral free of all unpaid claims and charges
(including claims for labor, materials and supplies) whatsoever;
(k) Debtor shall keep and maintain the Collateral in good condition,
working order and repair, ordinary wear and tear excepted, and from time to
time shall make or cause to be made all repairs, replacements and other
improvements in connection therewith that are necessary or desirable toward
such end. Debtor shall not misuse or abuse the Collateral, or waste or allow
it to deteriorate except for the ordinary wear and tear of its normal and
expected use in Debtor's business in accordance with Debtor's policies as then
in effect (provided that no changes are made to Debtor's policies as in
effect on the date hereof that would be materially adverse to the interests of
Secured Party), and shall comply with all material laws, statutes and
regulations pertaining to the use or ownership of the Collateral. Debtor
shall promptly notify Secured Party regarding any material loss or damage to
any material portion of the Collateral;
(1) Debtor shall take (i) all actions consistent with reasonable business
judgment, or (ii) upon the occurrence and during the continuation of a Default
or an Event of Default, all actions directed by Secured Party in Secured
Party's sole and absolute discretion, to create, preserve and enforce any
Liens or guaranties available to secure or guaranty payments due Debtor under
any contracts or other agreements with third parties, shall not voluntarily
permit any such payments to become more than thirty (30) days delinquent and
shall in a timely manner record and assign to Secured Party, to the extent and
at the earliest time permitted by law, any such Liens and rights under such
guaranties. Debtor shall give Secured Party written notice of any payments
due Debtor within five (5) days after any such payments become thirty (30)
days delinquent;
(m) upon Secured Party's request, Debtor shall promptly deliver to
Secured Party records and schedules that show the status, condition and
location of the Collateral, including accounts receivable aging reports and
other reports reasonably requested by Secured Party, all in reasonable detail;
shall promptly notify Secured Party in writing of any event, or change of law,
regulation, business practice, or business condition that may materially
adversely affect the value of the Collateral; and shall provide Secured Party
with current financial information concerning Debtor's business on a monthly,
quarterly and audited fiscal year end basis, with detail satisfactory to
Secured Party and which shall be prepared in accordance with generally
accepted accounting principles consistently applied. Secured Party shall have
the right to review and verify such records, schedules, financial information
and notices, and Debtor shall reimburse Secured Party for all costs incurred
thereby. Such review and verification shall include the right of Secured
Party to contact account debtors to confirm balances owing on and the terms of
Receivables, which right shall be subject to providing prior notice to Debtor
so long as no Default or Event of Default has occurred and is continuing;
(n) except as otherwise provided in this Section 5(n), Debtor shall
continue to collect, at its own expense, all amounts due or to be become due
Debtor under the Receivables or the Intangibles. In connection with such
collections, Debtor may take (and at Secured Party's reasonable direction,
shall take) such action as Debtor or Secured Party (or, upon the occurrence
and during the continuation of a Default or an Event of Default, Secured
Party) may deem necessary or advisable to enforce collection of the
Receivables or the Intangibles; provided, however, that Debtor shall not
adjust, settle or compromise the amount or payment of any Receivable or
Intangible, or release wholly or partly any account debtor or obligor thereof,
or allow any credit or discount thereon, other than adjustments, settlements,
or discounts that are in accordance with Debtor's policies as then in effect;
provided that no changes are made to Debtor's policies as in effect on the
date hereof that would be materially adverse to the interests of Secured
Party. Secured Party shall have the right at any time after the occurrence
and during the continuation of a Default or an Event of Default to notify the
account debtors or obligors under any of the Receivables or the Intangibles of
the assignment of such Receivables or Intangibles to Secured Party and to
direct such account debtors or obligors to make payment of all amounts due or
to become due to Debtor thereunder directly to Secured Party and, upon such
notification and at the expense of Debtor, to enforce collection of any such
Receivables or Intangibles, and to adjust, settle or compromise the amount or
payment thereof, as Secured Party may deem appropriate in its sole discretion.
After the occurrence and during the continuation of a Default or an Event of
Default (i) all amounts and proceeds (including instruments) received by
Debtor in respect of the Receivables or the Intangibles shall be received in
trust for the benefit of Secured Party hereunder and, upon notice from Secured
Party, shall be segregated from other funds of Debtor and shall be forthwith
paid over to Secured Party in the same form as so received (with all necessary
or appropriate endorsements as required by Secured Party) to be held as cash
collateral and applied as provided by the Indenture, and (ii) Debtor shall not
adjust, settle or compromise the amount or payment of any Receivable or
Intangible, or release wholly or partly any account debtor or obligor thereof,
or allow any credit or discount thereon;
(o) Secured Party shall have the right during regular business hours
and upon prior notice to Debtor to enter into and upon any premises where any
of the Collateral or records with respect thereto are located for the purpose
of inspecting the same, performing any audit, making copies of records,
observing the use of any part of the Collateral, or otherwise protecting its
security interest in the Collateral. Debtor shall hold and preserve all
records concerning the Receivables and (unless required to be delivered to
Secured Party) all originals of all chattel paper that evidences any
Receivables;
(p) Secured Party shall have the right at any time, but shall not be
obligated, to make any payments and do any other acts Secured Party may deem
necessary or desirable to protect its security interest in the Collateral,
including, without limitation, the right to pay, purchase, contest or
compromise any encumbrance, charge or Lien applicable or purported to be
applicable to any Collateral hereunder, and appear in and defend any action or
proceeding purporting to affect its security interest in and/or the value of
any Collateral, and in exercising any such powers or authority, the right to
pay all expenses incurred in connection therewith, including reasonable
attorneys' fees. Debtor hereby agrees that it shall be bound by any such
payment made or incurred or act taken by Secured Party hereunder and shall
reimburse Secured Party for all payments made and expenses incurred under this
Security Agreement, which amounts shall be secured under this Security
Agreement. Secured Party shall have no obligation to make any of the
foregoing payments or perform any of the foregoing acts;
(q) if Debtor shall become entitled to receive or shall receive any
certificate, instrument, option or right (other than checks received by Debtor
in the ordinary course of business, which Debtor promptly shall deposit into
one of the deposit accounts encumbered hereunder), whether as an addition to,
in substitution of, or in exchange for any or all of the Collateral or any
part thereof, or otherwise, Debtor shall accept any such instruments as
Secured Party's agent, shall hold them in trust for Secured Party, and shall
deliver them forthwith to Secured Party in the exact form-n received, with
Debtor's endorsement when necessary or appropriate, or accompanied by duly
executed instruments of transfer or assignment in blank or, if requested by
Secured Party, an additional pledge agreement or security agreement executed
and delivered by Debtor, all in form and substance satisfactory to Secured
Party, to be held by Secured Party, subject to the terms hereof, as additional
Collateral to secure the obligations hereunder;
(r) Secured Party is hereby authorized to pay all reasonable costs
and expenses incurred in the exercise or enforcement of its rights hereunder,
including reasonable attorneys' fees, and, while a Default or an Event of
Default exists, to apply any Collateral or proceeds thereof against such
amounts, and then to credit or use any further proceeds of the Collateral in
accordance herewith;
(s) Secured Party may take any actions permitted hereunder or in
connection with the Collateral by or through agents or employees and shall be
entitled to retain counsel and to act in reliance upon the advice of counsel
concerning all such matters; and
(t) Debtor hereby agrees to take all actions necessary to maintain
Secured Party's first prior security interest (subject to Permitted Liens) in
all Marks, Patents and Copyrights, to preserve the value of all Marks, Patents
and Copyrights, to prosecute and defend such Marks, Patents and Copyrights
against infringement, and to provide Secured Party with notice of any material
pertinent information regarding any such infringement, any material actions
with the United States Patent and Trademark Office and any other information
which could have a material adverse effect on the Marks, Patents and
Copyrights.
6. DEFAULTS AND REMEDIES
(a) The occurrence of any "Default" or "Event of Default" under the
Indenture (subject to the cure rights set forth therein) shall constitute a
Default or an Event of Default, as the case may be, under this Security
Agreement.
(b) Upon the occurrence and continuation of a Default or an Event of
Default hereunder, Debtor expressly covenants and agrees that Secured Party
may, at its option, subject to the terms of the Indenture, in addition to
other rights and remedies provided herein or otherwise available to it,
without notice to or demand upon Debtor (except as otherwise required herein),
exercise any one or more of the rights as set forth as follows:
i) declare all advances made by Secured Party to Debtor hereunder,
all other indebtedness owed by Debtor to Secured Party and all Secured
Obligations to be immediately due and payable, whereupon all unpaid principal
and interest on said advances and other indebtedness and Secured Obligations
shall become and be immediately due and payable;
ii) immediately take possession of any of the Collateral wherever it may
be found or require Debtor to assemble the Collateral or any part thereof and
make it available at one or more places as Secured Party may designate, and to
deliver possession of the Collateral or any part thereof to Secured Party, who
shall have full right to enter upon any or all of Debtor's places of business,
premises and property to exercise Secured Party's rights hereunder
iii) exercise any or all of the rights and remedies provided for by
the Louisiana Uniform Commercial Code, Commercial Laws - Secured Transactions,
specifically including, without limitation, the right to recover the
attorneys' fees and other expenses incurred by Secured Party in the
enforcement of this Security Agreement or in connection with Debtor's
redemption of the Collateral. Secured Party may exercise its rights under
this Security Agreement independently of any other collateral or guaranty that
Debtor may have granted or provided to Secured Party in order to secure
payment and performance of the Secured Obligations, and Secured Party shall be
under no obligation or duty to foreclose or levy upon any other collateral
given by Debtor to secure any Secured Obligation or to proceed against any
guarantor before enforcing its rights under this Security Agreement;
iv) use, manage, operate and control the Collateral and Debtor's
business and property to preserve the Collateral or its value, or to pay the
Secured Obligations, including, without limitation, the rights to take
possession of all of Debtor's premises and property, to exclude Debtor and any
third parties, whether or not claiming under Debtor, from such premises and
property, to make repairs, replacements, alterations, additions and
improvements to the Collateral and to dispose of all or any portion of the
Collateral in the ordinary course of Debtor's business;
v) except as herein provided or as may be required by mandatory provisions
of law, sell the Collateral or any part thereof at public or private sale, for
cash, upon credit or for future delivery, and at such price or prices as
Secured Party may deem satisfactory. Secured Party may be the purchaser of
any or all of the Collateral so sold at any public sale (or, if the Collateral
is of a type customarily sold in a recognized market or is of a type which is
the subject of widely distributed standard price quotations, at any private
sale). Debtor shall execute and deliver such documents and take such other
action as Secured Party deems necessary or advisable in order that any such
sale may be made in compliance with law. Upon any such sale Secured Party
shall have the right to deliver, assign and transfer to the purchaser thereof
the Collateral so sold. Each purchaser at any such sale shall hold the
Collateral so sold to it absolutely and free from any claim or right of
whatsoever kind, including any equity or right of redemption of Debtor which
may be waived, and Debtor, to the extent permitted by law, hereby specifically
waives all rights of redemption, stay or appraisal which it has or may have
under any law now existing or hereafter adopted. Debtor agrees that ten (10)
days prior written notice of the time and place of any sale or other intended
disposition of any of the Collateral constitutes "reasonable notification"
within the meaning of Section 9:504(3) (or any comparable section in any other
jurisdiction) of the Louisiana Uniform Commercial Code, Commercial Laws -
Secured Transactions, except that shorter or no notice shall be reasonable as
to any Collateral which is perishable or threatens to decline speedily in
value or is of a type customarily sold on a recognized market. The notice (if
any) of such sale shall (i) in case of a public sale, state the time and place
fixed for such sale, (ii) in the case of a private sale, state the day after
which such sale may be consummated. Any such public sale shall be held at
such time or times within ordinary business hours and at such place or places
as Secured Party may fix and the notice of such sale. At any such sale the
Collateral may be sold in one lot as an entirety or in separate parcels or
portions, as Secured Party may determine and with or without any attendant
foreclosure or sale of real property also serving as collateral for any of the
Secured Obligations. Secured Party shall not be obligated to make any such
sale pursuant to any such notice. Secured Party may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
the sale, and such sale may be made at any time or place to which the same may
be so adjourned. In case of any sale of all or any part of the Collateral on
credit or for future delivery, the Collateral so sold may be retained by
Secured Party until the selling price is paid by the purchaser thereof, but
Secured Party shall not incur any liability in case of the failure of such
purchaser to take up and pay for the Collateral so sold and, in case of any
such failure, such Collateral may again be sold upon like notice;
vi) proceed by an action or actions at law or in equity to recover
the indebtedness secured hereunder or to foreclose this Security Agreement and
sell the Collateral, or any portion thereof, pursuant to a judgment or decree
of a court or courts of competent jurisdiction in any manner permitted by law,
or provided for herein;
vii) in the event Secured Party recovers possession of all or any
part of the Collateral pursuant to a writ of possession or other judicial
process, whether prejudgment or otherwise, Secured Party may retain, sell or
otherwise dispose of such Collateral in accordance with this Security
Agreement or the Louisiana Uniform Commercial Code, Commercial Laws - Secured
Transactions, and following such retention, sale or other disposition, Secured
Party may voluntarily dismiss without prejudice the judicial action in which
such writ of possession or other judicial process was issued. Debtor hereby
consents to the voluntary dismissal without prejudice by Secured Party of such
judicial action, and Debtor further consents to the exoneration of any bond
which Secured Party files in such action;
viii) with respect to the sale of securities constituting Collateral,
to the extent Secured Party deems it advisable to do so, in its sole
discretion or as may be required by applicable law, restrict the prospective
bidders or purchasers to persons who in Secured Party's sole judgment are
sufficiently sophisticated and who shall represent and agree that they are
purchasing the securities constituting Collateral then being sold for their
own account and not with a view to the distribution or resale thereof, and
upon consummation of any such sale, Secured Party shall have the right to
assign, transfer and deliver to the purchaser or purchasers thereof the
securities constituting Collateral so sold;
ix) Secured Party, in its sole discretion, if permitted by law, may
bid (which bid may be, in whole or in part, in the form of cancellation of
indebtedness) for and purchase for its account the whole or any part of the
Collateral at any public sale or sale on any securities exchange or other
recognized market;
X) to the full extent provided by law, have a court having jurisdiction
appoint a receiver, which receiver shall take charge and possession of and
protect, preserve, replace and repair the Collateral or any part thereof, and
manage and operate the same, and receive and collect all rents, income,
receipts, royalties, revenues, issues and profits therefrom. Debtor shall
irrevocably consent and shall be deemed to have hereby irrevocably consented
to the appointment thereof, and upon such appointment, Debtor shall
immediately deliver possession of such Collateral to the receiver. Debtor
also irrevocably consents to the entry of an order authorizing such receiver
to invest upon interest any funds held or received by the receiver in
connection with such receivership. Secured Party shall be entitled to such
appointment as a matter of right, if it shall so elect, without the giving of
notice to any other party and without regard to the adequacy of the security
of the Collateral;
xi) enforce one or more remedies hereunder, successively or
concurrently, and such action shall not operate to stop or prevent Secured
Party from pursuing any other or further remedy which it may have hereunder or
by law, and any repossession or retaking or sale of the Collateral pursuant to
the terms hereof shall not operate to release Debtor until full and final
payment of any deficiency has been made in cash. Debtor shall reimburse
Secured Party upon demand for, or Secured Party may apply any proceeds of
Collateral to, the costs and expenses (including attorneys' fees, transfer
taxes and any other charges) incurred by Secured Party in connection with any
sale, disposition, repair, replacement, alteration, addition, improvement or
retention of any Collateral hereunder;
xii) upon the occurrence of a Default or an Event of Default
hereunder, any cash held by Secured Party as Collateral and all cash proceeds
received by Secured Party in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral may, in the discretion of
Secured Party, be held by Secured Party as collateral for and/or then or at
any time thereafter applied (including application to the payment of any
costs, expenses, indemnification and other amounts payable to Secured Party
hereunder, which amounts may be paid in whole or in part prior to the other
Secured Obligations) in whole or in part by Secured Party against all or any
part of the Secured Obligations in such order as Secured Party shall elect.
Any surplus of such cash or cash proceeds held by Secured Party and remaining
after payment in full of all the Secured Obligations shall be paid over to
Debtor or to whomever may be lawfully entitled to receive such surplus or as a
court of competent jurisdiction may direct; provided, however, that in the
event that all of the conditions to termination of this Security Agreement
under Section 7(l) shall have not been fulfilled, such balance shall be held
as additional Collateral hereunder and applied from time to time to Secured
Party's costs and expenses and as otherwise provided hereunder until all such
conditions shall have been fulfilled; and
xiii) effect an absolute assignment of all of Debtor's right, title
and interest in and to each Xxxx (and the goodwill of the business of Debtor
associated therewith), Patent and Copyright.
(c) The provisions of this Subsection 6(c) shall, without limiting
the generality of any other provision of this Security Agreement, be
applicable in the event any foreclosure shall take place in Louisiana on any
Collateral or, in connection with any foreclosure hereunder, Louisiana law
shall otherwise be applicable. Secured Party, instead of exercising the power
of sale herein conferred upon it, may proceed by a suit or suits at law or in
equity to foreclose this Security Agreement and sell the Collateral, or any
portion thereof, under a judgment or decree of a court or courts of competent
jurisdiction. For the purposes of Louisiana executory process procedures,
Debtor does hereby acknowledge the Secured Obligations and confess judgment in
favor of Secured Party for the full amount of such Secured Obligations.
Debtor does by these presents consent and agree that upon the occurrence of a
Default or an Event of Default it shall be lawful for Secured Party to cause
all and singular the Collateral to be seized and sold under executory or
ordinary process, at Secured Party's sole option, without apraisement,
appraisement being hereby expressly waived, in one lot as an entirety or in
separate parcels or portions as Secured Party may determine, to the highest
bidder, and otherwise exercise the rights, powers and remedies afforded herein
and under applicable Louisiana law. Any and all declarations of fact made by
authentic act before a Notary Public in the presence of two (2) witnesses by a
person declaring that such facts lie within his knowledge shall constitute
authentic evidence of such facts for the purpose of executory process. Debtor
hereby waives in favor of Secured Party: (a) the benefit of appraisement as
provided in Louisiana Code of Civil Procedure Articles 2332, 2336, 2723 and
2724, and all other laws conferring the same; (b) the demand and three (3)
days delay accorded by Louisiana Code of Civil Procedure Articles 2639 and
2721; (c) the notice of seizure required by Louisiana Code of Civil Procedure
Articles 2293 and 2721; (d) the three (3) days delay provided by Louisiana
Code of Civil Procedure Articles 2331 and 2722; and (e) benefit of the other
provisions of Louisiana Code of Civil Procedure Articles 2331, 2722 and 2723
not specifically mentioned above. In the event the Collateral, or any part
thereof, is seized as an incident to an action for the recognition or
enforcement of this Security Agreement by executory process, ordinary process,
sequestration, writ of fieri facias, or otherwise, Debtor and Secured Party
agree that the court issuing any such order shall, if petitioned for by
Secured Party, direct the applicable sheriff or xxxxxxxx to appoint as a
keeper of the Collateral, Secured Party or any agent designated by Secured
Party or any Person named by Secured Party at the time such seizure is
effected. This designation is pursuant to Louisiana Revised Statutes
9:5136-9:5140.2 and Secured Party shall be entitled to all the rights and
benefits afforded thereunder as the same may be amended. It is hereby agreed
that the keeper shall be entitled to receive as compensation, in excess of its
reasonable costs and expenses incurred in the administration or preservation
of the Collateral, an amount equal to $250.00 per day payable on a monthly
basis. The designation of keeper made herein shall not be deemed to require
Secured Party to provoke the appointment of such a keeper.
7. MISCELLANEOUS PROVISIONS
(a) Notices. All notices, requests, approvals, consents and other
communications required or permitted to be made hereunder shall, except as
otherwise provided, be in writing and may be delivered personally or sent by
telegram, telecopy, facsimile, telex, first class mail or overnight courier,
postage prepaid, to the parties addressed as follows:
To Debtor: Jefferson Casino Corporation 0000 Xxx Xxxxxx Xxxx Xxxxxxx Xxxx,
Xxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxx, Esq.
Ph: (000) 000-0000
Fax: (000) 000-0000
To Secured Party: First Union Bank of Connecticut
00 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Ph: (000) 000-0000
Fax: (000) 000-0000
Attn: Corporate Trust Administration
With a copy to:
Xxxxx Xxxxxxxxxx, Esq.
Xxxx, Scholer, Fierman, Xxxx & Handler, LLP
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ph: (000) 000-0000
Fax: (000) 000-0000
Such notices, requests and other communications sent as provided herein above
shall be effective when received by the addressee thereof, unless sent by
registered or certified mail, postage ,prepaid, in which case they shall be
effective exactly three (3) business days after being deposited in the United
States mail. The parties hereto may change their addresses by giving notice
thereof to the other parties hereto in conformity with this section.
(b) Headings. The various headings in this Security Agreement are
inserted for convenience only and shall not affect the meaning or
interpretation of this Security Agreement or any provision hereof.
(c) Amendments. This Security Agreement or any provision hereof
may be changed, waived, or terminated only by a statement in writing signed by
the party against which such change, waiver or termination is sought to be
enforced, and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
(d) No Waiver. No failure on the part of Secured Party to
exercise, and no delay in exercising, and no course of dealing with respect
to, any power, privilege or right under this Security Agreement or any related
agreement shall operate as a waiver thereof nor shall any single or partial
exercise by Secured Party of any power, privilege or right under this Security
Agreement or any related agreement preclude any other or further exercise
thereof or the exercise of any other power, privilege or right. The powers,
privileges and rights in this Security Agreement are cumulative and are not
exclusive of any other remedies provided by law. No waiver by Secured Party
of any default hereunder shall be effective unless in writing, nor shall any
waiver operate as a waiver of any other default or of the same default on a
future occasion.
(e) Binding Agreement. All rights of Secured Party hereunder shall
inure to the benefit of its successors and assigns. Debtor shall not assign
any of its interest under this Security Agreement without the prior written
consent of Secured Party. Any purported assignment inconsistent with this
provision shall, at the option of Secured Party, be
null and void.
(f) Entire Agreement. This Security Agreement, together with any
other agreement executed in connection herewith, is intended by the parties as
a final expression of their agreement and is intended as a complete and
exclusive statement of the terms and conditions thereof. Acceptance of or
acquiescence in a course of performance rendered under this Security Agreement
shall not be relevant to determine the meaning of this Security Agreement even
though the accepting or acquiescing party had knowledge of the nature of the
performance and opportunity for objection.
(g) Choice of Law. The existence, validity, construction,
operation and effect of any and all terms and provisions of this Security
Agreement shall be determined in accordance with and governed by the
substantive laws of the State of Louisiana, without giving effect to its
conflicts of law principles.
(h) Severabilily. If any provision or obligation of this Security
Agreement should be found to be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions and obligations or any other agreement executed in connection
herewith, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby and shall nonetheless remain in
full force and effect to the maximum extent permitted by law.
(i) Survival of Provisions. All representations, warranties and
covenants of Debtor contained herein shall survive the execution and delivery
of this Security Agreement, and shall terminate only upon the termination of
this Security Agreement pursuant to Subsection 7(l) hereof.
(j) Power of Attorney. Debtor hereby irrevocably appoints Secured
Party its attorney-in-fact, which appointment is coupled with an interest,
with full authority in the place and stead of Debtor and in the name of
Debtor, Secured Party or otherwise, from time to time in Secured Party's
discretion (a) to execute and file financing and continuation statements (and
amendments thereto and modifications thereof) on behalf and in the name of
Debtor with respect to the security interests granted or purported to be
granted hereby, (b) to take any action and to execute any instrument which
Secured Party may deem necessary or advisable to exercise its rights under
Section 5(r) hereunder, and (c) upon the occurrence and during the continuance
of a Default or an Event of Default, to take any action and to execute any
instrument which Secured Party may deem necessary or advisable to accomplish
the purposes of this Security Agreement, including, without limitation:
(i) to obtain and adjust insurance required to be paid to Secured
Party pursuant hereto;
(ii) to ask, demand, collect, xxx for, recover, compound, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral;
(iii) to receive, endorse and collect any drafts or other instruments,
documents and chattel paper, in connection with clauses (i) and (ii) above;
(iv) to sell, convey or otherwise transfer any item of Collateral to
any purchaser thereof; and
(v) to file any claims or take any action or institute any
proceedings which Secured Party may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights of
Secured Party with respect to any of the Collateral.
(k) Counterparts. This Security Agreement and any amendments,
waivers, consents or supplements may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all of which shall together constitute one and the same
agreement.
(1) Termination of Agreement. Subject to Section 10.01 of the
Indenture, this Security Agreement and the security interest hereunder shall
not terminate until full and final payment and performance of all of the
Secured Obligations. At such time, Secured Party shall reassign and redeliver
to Debtor all of the Collateral hereunder which has not been sold, disposed
of, retained or applied by Secured Party in accordance with the terms hereof,
and execute and deliver to Debtor such documents as Debtor may reasonably
request to evidence such termination. Such reassignment and redelivery shall
be without warranty by or recourse to Secured Party, and shall be at the
expense of Debtor; provided, however, that this Security Agreement
(including all representations, warranties and covenants contained herein and
the priority of the security interests hereunder) shall continue to be
effective or be reinstated, as the case may be, if at any time any amount
received by Secured Party in respect of the indebtedness and obligations
secured hereunder is rescinded or must otherwise be restored or returned by
Secured Party upon or in connection with the insolvency, bankruptcy,
dissolution, liquidation or reorganization of Debtor or any other person or
upon or in connection with the appointment of any intervenor or conservator
of, or trustee or similar official for, Debtor or any other person or any
substantial part of its assets, or otherwise, all as though such payments had
not been made and Debtor shall take all action required by Secured Party in
connection therewith.
(m) Successors and Assigns. This Security Agreement shall inure to
the benefit of Secured Party, its successors and assigns, including the
assignees of any Secured Obligation or of the benefit of any Secured
Obligation and shall bind the heirs, executors, administrators, successors and
assigns of Debtor. This Security Agreement is assignable by Secured Party
with respect to all or any portion of the Secured Obligations, and when so
assigned, Debtor shall be liable to the assignees under this Security
Agreement without in any manner affecting the liability of Debtor hereunder
with respect to any of the Secured Obligations retained by Secured Party.
Each reference herein to powers or rights of Secured Party shall also be
deemed a reference to the same power or right of such assignees, to the extent
of the interest assigned to them.
(n) Interaction with Financing Documents.
(i) Incorporation by Reference. All terms, covenants, conditions,
provisions and requirements of the Indenture are incorporated by reference in
this Security Agreement.
(ii) Conflicts with Indenture. Notwithstanding any other provision
of this Security Agreement, the terms and provisions of this Security
Agreement shall be subject and subordinate to the terms of the Indenture. To
the extent that the Indenture provides Debtor with a particular cure or notice
period, or establishes any limitations or conditions on Secured Party's
actions with regard to a particular set of facts, Debtor shall be entitled to
the same cure periods and notice periods, and Secured Party shall be subject
to the same limitations and conditions in place of the cure periods, notice
periods, limitations and conditions provided for under the Indenture;
provided, however, that such cure periods, notice periods, limitations and
conditions shall not be cumulative as between the Indenture and this Security
Agreement. In the event of any conflict or inconsistency between the
provisions of this Security Agreement and those of the Indenture, including
without limitation, any conflicts or inconsistencies in any definitions herein
or therein, the provisions or definitions of the Indenture shall govern.
(o) Gaming Laws and Regulations. Debtor and Secured Party
acknowledge that, to the extent required under applicable law, the
consummation of the transactions contemplated hereby and the exercise of
remedies hereunder may be subject to the Louisiana Riverboat Economic
Development and Gaming Control Act, La. R. S. 4:501, g s"e ., and the
Louisiana Gaming Control Law, La. R. S. 27:1-3, 11-26, 31 and 32, and the
regulations promulgated pursuant to each such law, all as amended from time to
time. Debtor and Secured Party further acknowledge that the Gaming License
held by Borrower is not part of the collateral of this Security Agreement and
that, under the above described legislation and rules promulgated thereunder,
the Secured Party may be precluded from or otherwise limited in taking
possession of or in selling the collateral of this Security Agreement under
the Defaults and Remedies provisions of this Security Agreement. Debtor and
Secured Party also acknowledge that due to various legal restrictions,
including, without limitation, licensing of operators of gaming facilities and
prior approval of the sale or disposition of assets of a licensed gaming
operation, the sale of collateral may be denied by Gaming Authorities or
delayed pending Gaming Authority approval.
IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be duly executed and delivered by their respective undersigned
duly authorized officers as of the date first above written.
DEBTOR:
JEFFERSON CASINO CORPORATION,
a Louisiana corporation
By:/s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President and General Council
SECURED PARTY:
FIRST UNION BANK OF CONNECTICUT, a Connecticut banking corporation, as trustee
for the benefit of the holders of the Notes
By: /s/ W. Xxxxxxx Xxxxxx
Name: W. Xxxxxxx Xxxxxx
Title: Vice President
S-1
EXHIBIT "A"
OTHER BUSINESS OR TRADE NAMES USED BY DEBTOR
NONE
A-1
EXHIBIT "B"
DEPOSIT ACCOUNTS
NONE
B-1
ANNEX 1
A. SCHEDULE OF U.S. TRADEMARK REGISTRATIONS NONE.
NONE
B. SCHEDULE OF PENDING APPLICATIONS FOR U.S. TRADEMARK REGISTRATIONS ON
THE BASIS OF USE IN COMMERCE UNDER 17 USC 1051(a)
NONE
C. SCHEDULE OF PENDING APPLICATION FOR U.S. TRADEMARK REGISTRATIONS ON THE
BASIS OF INTENT TO USE THE XXXX IN COMMERCE UNDER 17 USC 1051(b)
NONE.
AX-1
ANNEX 2
SCHEDULE OF PATENTS AND APPLICATIONS
NONE.
AX-2
ANNEX 3
SCHEDULE OF COPYRIGHTS AND APPLICATIONS
NONE
AX-3
