EXHIBIT 4.5
Recording at the Request of and
when Recorded Mail Original to:
Xxxxxx & Xxxxxxx
000 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxx, Esq.
DEED OF TRUST TO PUBLIC TRUSTEE,
SECURITY AGREEMENT, FIXTURE FILING AND
ASSIGNMENT OF RENTS, LEASES AND LEASEHOLD INTERESTS
(XXXXXX COUNTY, COLORADO)
THIS DEED OF TRUST TO PUBLIC TRUSTEE, SECURITY AGREEMENT, FIXTURE
FILING AND ASSIGNMENT OF RENTS, LEASES AND LEASEHOLD INTERESTS (as the same may
be amended, supplemented or otherwise modified from time to time, this "Deed of
Trust") is made and entered into as of August 20, 1997 by ISLE OF CAPRI BLACK
HAWK L.L.C., a Colorado limited liability company (the "Company"), whose address
is c/o Casino America Inc., 000 Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxxxxx 00000 and
whose federal taxation identification number is 00-0000000, and by ISLE OF CAPRI
BLACK HAWK CAPITAL CORP., a Colorado corporation ("Capital Corp." and, together
with the Company and any successor or assign thereof, collectively, the
"Trustors" and each, a "Trustor") and whose address is c/o Casino America, Inc.,
000 Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx 00000 and whose federal taxpayer
identification number is 00-0000000, to the PUBLIC TRUSTEE OF THE COUNTY OF
XXXXXX, COLORADO ("Trustee"), for the benefit of IBJ XXXXXXXX BANK & TRUST
COMPANY, a New York banking corporation, whose address is Xxx Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, in its capacity as trustee under the Indenture referred to
below ("Beneficiary") for its benefit and the benefit of the Holders (as defined
herein).
RECITALS
A. Beneficiary and Trustors are the parties to that certain
Indenture dated as of August 20, 1997 (as the same may be amended, supplemented
or otherwise modified from time to time, the "Indenture"). Unless otherwise
defined herein, capitalized terms used in this Deed of Trust shall have the
meanings given such terms in Annex A attached hereto.
B. Trustors have, under the Indenture, issued their 13% First
Mortgage Notes Due 2004 With Contingent Interest in the original principal
amount of $75,000,000 (together with any amendments, supplements, modifications,
renewals or extensions thereof
and any notes issued in replacement thereof or exchange therefor from time to
time, the "Notes"). The Notes, the Indenture, the Collateral Documents and all
other documents, agreements and instruments (in each case, as amended,
supplemented or otherwise modified from time to time) now or hereafter executed
and delivered in connection with the Indenture and transactions described
therein are collectively hereinafter referred to as the "Transaction Documents."
C. The Indenture requires that the obligations of Trustors under the
Notes, the Indenture and the other Transaction Documents be secured by liens and
security interests covering certain property of Trustors. In connection
therewith, Trustors are executing and delivering this Deed of Trust in
accordance with the Indenture.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Trustors agree as follows:
ARTICLE I - GRANT OF DEED OF TRUST
1.1 Grant of Deed of Trust. Each Trustor does hereby irrevocably grant,
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assign, bargain, convey, transfer, warrant and set over unto Trustee, IN TRUST,
WITH POWER OF SALE, under and subject to the terms and conditions hereof, for
the benefit and security of Beneficiary and for the ratable benefit and security
of the Holders, all of such Trustor's right, title and interest in and to all of
the following property, to the extent assignable under applicable law, whether
now owned or hereafter acquired (collectively, the "Trust Property"):
(a) the real property described in Exhibit A attached hereto and by
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this reference incorporated herein, including, without limitation, all air
rights with respect thereto (the "Land");
(b) any and all buildings, constructions, facilities and fixtures,
pipelines and all other improvements now on, or hereafter located or constructed
on or in, the Land or any portion thereof (collectively, "Improvements"), and
all fixtures, construction materials, goods (including, without limitation,
consumer goods, equipment and inventory) and other articles of real and personal
property which are now or hereafter affixed to, placed upon or used in
connection with the Trust Property;
(c) tenements and hereditaments of whatever kind or description and
wherever situated and all of such Trustor's right, title and interest in and to
any land lying within the right of way of any street, open or proposed,
adjoining the Land, any and all sidewalks, and any land lying between the
boundaries of the Land and the center line of any adjacent street, road, avenue
or alley, whether existing, vacated or proposed;
(d) any and all furniture, fittings and fixtures (whether actually or
constructively attached, and including all trade fixtures), equipment, machinery
(including, without limitation, any and all equipment, machinery and apparatus
used for or in connection
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with maintaining and operating gaming facilities, gaming devices including slot
machines, poker tables and blackjack tables, lodging, restaurants, bars or
entertainment facilities), appliances, construction materials, personal
property, supplies, tools, paintings, sculptures, murals, art work, books, and
now or hereafter or from time to time situated on, in or under the Land and/or
any Improvements or used or usable in connection with any present or future use
of the Land, whether or not affixed to the realty, including, but not limited
to, power, lighting, heating, electrical, ventilating, air conditioning, gas,
electricity, water sprinkling and sprinkler protection, mechanical and plumbing
materials, waste removal, refrigeration, ventilation, freezing, laundry,
incinerating and power equipment; fixtures and supplies; fences and fencing;
water and power systems; irrigation systems and equipment; plumbing, lifting,
cleaning, fire prevention, fire extinguishing, ventilating, cooling and
communication apparatus and equipment; engines; boilers; furnaces; elevators;
escalators; pipes; pumps; tanks; switchboards; ducts; conduits; conveyor belts;
motors; refrigeration facilities plants; vacuum cleaning systems; awnings;
shrubbery, trees, vines and other plants of every kind and nature; ranges;
furnaces; ovens; burners; refrigerators; cabinets; dishwashers; disposals;
shades; awnings; blinds; drapes; attached floor coverings, including carpeting;
screens, storm doors and windows; rugs and carpets; draperies; beds, bureaus,
chests, desks, lamps, bookcases, tables, chairs and couches; radios and
television sets; china, glassware, silverware, tableware, linens, towels,
bedding and blankets; kitchen equipment and utensils; bars and bar fixtures;
uniforms; safes, vaults, cash registers, accounting and duplicating machines;
statuary, hangings, mirrors, decorations, pictures and ornaments;
(e) all contract rights of whatever nature, whenever acquired,
relating to the other Trust Property described in this Section 1.1, including,
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without limitation, architectural and engineering plans, plans and
specifications, drawings, tests, reports or studies relating to the construction
and Improvements on or to the Land, contracts for goods or services and
management contracts, all warranties and guaranties under such contracts and all
rights under architects' contracts, construction contracts, supply contracts,
completion bonds, performance bonds and payment bonds, all accounts, general
intangibles, documents, instruments and chattel paper arising from or in
connection with such other Trust Property, including all books and records in
connection therewith, all rights, claims, suits or demands that such Trustor now
has or may hereafter acquire with respect to any damage to the Collateral (as
defined below);
(f) any and all rights of such Trustor under any leases or other
agreements entered into by such Trustor (as a "landlord," "sublandlord,"
"lessor," "sublessor" or similar capacity) now in existence or hereafter arising
and providing for the use and occupancy of all or any portion of the Trust
Property (each, as amended, supplemented or otherwise modified from time to
time, a "Tenants Lease," and collectively, the "Tenants Leases");
(g) any and all additions, betterments and improvements hereafter
acquired or constructed upon or in connection with any other property, real or
personal, now or at any time hereafter subject to the lien of this Deed of
Trust;
(h) any and all easements, rights of way, servitudes, surface rights,
interests in land, permits, licenses, grants affecting land, and all amendments
thereof,
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relating or appurtenant to the Land and/or any of the Improvements, fixtures,
personal property, easements, rights, interests and/or other items described in
this Section 1.1, now or hereafter belonging or pertaining to the Land,
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including, without limitation, all franchises, privileges, reservations,
allowances, immunities, powers, rights, ordinances, permits, licenses, grants,
leases, consents, possessory and prescriptive rights of such Trustor in, on,
over, under, across and through lands, roads, highways, railroads, canals,
channels, waterways, ditches, bridges or structures, or elsewhere, together with
such Trustor's interest (now owned or hereafter acquired) in all fixtures,
Improvements and personal property now or hereafter from time to time situated
on, in, over, under, across or through, attached to or used in connection with
such Trust Property and all rights and appurtenances incident thereto;
(i) any and all rights, powers, franchises, privileges, immunities,
permits and licenses now or hereafter owned or possessed by such Trustor that
now or at any time hereafter may be necessary or useful for, or appurtenant to,
the use, operation, management, maintenance, renewal, alteration or improvement
of any of the other Trust Property;
(j) all income, rents, receipts, security or similar deposits,
revenues, issues, royalties, profits, earnings, products and proceeds from any
and all of the Land or any buildings or other Improvements, now owned or
hereafter acquired (collectively, the "Rents, Issues and Profits"), together
with the right to collect and apply the same to any indebtedness secured
hereunder, subject, however, to the right hereafter given to such Trustor to
collect the Rents, Issues and Profits as long as such Trustor is not in default
hereunder;
(k) any and all rights and estates in reversion or remainder;
(l) all oil and gas or other mineral rights in or pertaining to the
Land and all royalty, leasehold and other rights of such Trustor pertaining
thereto, now owned or hereafter acquired;
(m) all monies in the possession of Beneficiary or any Holder
(including, without limitation, retainages and deposits for taxes and
insurance), and all refundable utility, tenant, escrow and governmental fees and
deposits, and all refundable fees and deposits of every other nature, now owned
or hereafter acquired;
(n) any and all rights to obtain water, sewer and other services from
municipalities and service districts;
(o) all water and water rights, ditches and ditch rights, reservoirs
and storage rights, xxxxx and well rights, springs and spring rights,
groundwater rights (whether tributary, nontributary or not-nontributary), water
contracts, water allotments, water taps, shares in ditch or reservoir companies,
and all other rights of any kind or nature in or to the use of water, which are
appurtenant to, historically used on or in connection with, or located on or
under the Land, including, without limitation, shares of stock evidencing the
foregoing and all deposits made with or other security given to utility
companies by such Trustor with
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respect to the Land or any buildings or other Improvements, together with any
and all easements, rights of way, fixtures, personal property, contract rights,
permits or decrees associated with or used in connection with any such rights;
(p) all shrubbery, trees, vines, flowers, plants and landscaping
features of every kind and nature and all crops of every type and nature, annual
and perennial, now or hereafter located on, under or above the Land, all
harvested crops wherever stored and any document of title or other document
representing a storage obligation, including, but not limited to, warehouse
receipts, negotiable or nonnegotiable, which may be received for crops in which
such Trustor has any right, title or interest wherever stored;
(q) all claims or demands relating to insurance which such Trustor now
has or may hereafter acquire with respect to any Trust Property, including,
without limitation, all advance payments of insurance premiums made by such
Trustor with respect thereto;
(r) all awards and payments, including, without limitation, interest
payments, resulting from the exercise of any right of condemnation or eminent
domain or from any other public or private taking of, injury to or decrease in
the value of, any of the Land or Improvements, or any agreement or conveyance in
lieu of any such action;
(s) all goods, inventory, equipment, building and other materials,
supplies, and other tangible personal property of every nature now owned or
hereafter acquired by such Trustor and used or intended for use in the
construction, development, or operation of the Land or any Improvements
(including, without limitation, all opened and unopened food and liquor
supplies);
(t) all of the records and books, computer programs, tapes, discs,
software and other like records and information now or hereafter maintained by
or on behalf of such Trustor in connection with the use of the Land and the
Improvements;
(u) all franchise, operating and management agreements, liquor and
gaming licenses (in each case, to the full extent legally assignable),
restaurant, occupancy, hotel, motel and other licenses, permits and
authorizations relating to the operation of the Improvements;
(v) deposit accounts and other bank or similar accounts of such
Trustor (together with all amounts in any such accounts), monies, accounts,
accounts receivable, contract rights and general intangibles (whether now owned
or existing or hereafter created or acquired, and including proceeds thereof)
relating in any way to, or arising in any manner from, such Trustor's ownership,
use, operation, leasing, or sale of all or any part of the property, rights and
interests described in this Section 1.1 (including, without limitation, all
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monies, rents, receipts, proceeds and compensation of every kind whatsoever
received by or on behalf of such Trustor and produced from (i) the use or
occupancy of all or any part of the Improvements by the public or others, for
lodging, dwelling, office or residential purposes, (ii) gains arising from the
sale or other disposition of capital assets, including furniture, fixtures and
equipment, (iii) compensation awards, or proceeds in lieu thereof, (iv)
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all food and beverage sales, (v) garage and parking rentals, (vi) meeting space
rental, (vii) telephone, telecopy and telex income, (viii) income from vending
machines and newsstands, (ix) recreational fees, (x) hotel rentals; and (xi)
entertainment revenues;
(w) any other real property acquired by such Trustor after the date
hereof whether or not it is adjacent or contiguous to the Land, and is acquired
by such Trustor as a continuation, completion, correction or supplement to the
Land;
(x) any and all other rights and interests of every name and nature in
all property, whether real, personal or mixed, tangible or intangible, now or
hereafter owned or leased by such Trustor, forming a part of or used in
connection with or relating to the Land and the construction, operation and
convenience of the Improvements (including without limitation, any excavation
permits and other permits issued by Governmental Authorities);
(y) subject to the provisions and limitations contained in the
Indenture, all proceeds of any sales or other dispositions of the property or
rights described in the foregoing clauses to this Section 1.1 or any part
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thereof whether voluntary or involuntary, provided, however, that the foregoing
shall not be deemed to permit such sales, transfers, or other dispositions
except as specifically permitted herein;
(z) to the extent permitted by applicable law, all of such Trustor's
right, title, and interest in and to any and all licenses, permits, variances,
special permits, franchises, certificates, rulings, certifications, validations,
exemptions, filings, registrations, authorizations, consents, approvals,
waivers, orders, rights and agreements (including, without limitation, options,
option rights and contract rights) now or hereafter obtained by such Trustor
from any governmental authority having or claiming jurisdiction over the Land,
the FF&E, the Project, or any other element of the Trust Property or providing
access thereto, or the operation of any business on, at, or from the Land, other
than any Gaming Licenses and the Liquor License (including, without limitation,
any Gaming Licenses (except for any registrations, licenses, findings of
suitability or approvals issued by the Gaming Authority or any other gaming
licenses which are non-assignable); provided, that upon an Event of Default
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hereunder or under the Indenture, if Beneficiary is not qualified under the
Gaming Laws to hold such Gaming Licenses, then Beneficiary shall designate an
appropriately qualified third party to which an assignment of such Gaming
Licenses can be made in compliance with the Gaming Laws;
(aa) any and all monies and other property, real or personal, which
may from time to time be subjected to the lien hereof by such Trustor or by
anyone on its behalf or with its consent, or which may come into the possession
or be subject to the control of Beneficiary pursuant to this Deed of Trust or
any Collateral Document, including, without limitation, any protective advances
under this Deed of Trust;
(bb) such Trustor's rights further to assign, sell, lease, encumber or
otherwise transfer or dispose of the property described in the foregoing clauses
of this Section 1.1, for debt or otherwise, or to evidence or secure a Permitted
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Lien or Permitted Disposition;
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(cc) all after-acquired property in the same categories as any of the
foregoing clauses of this Section 1.1; and all additions and/or accessions to,
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and all renewals, substitutions and replacements of any of the foregoing, and
all other things of whatsoever kind and in any way or at any time belonging or
appurtenant to, or used in connection with, any of the other Trust Property
described in this Section; and
(dd) to the extent not otherwise included in the foregoing, all
proceeds and products of any and all of the foregoing and, to the extent
permitted by applicable law, proceeds of any and all Gaming and Liquor Licenses
even if such Gaming and Liquor Licenses are not subject to the liens granted
hereunder and all collateral security and guarantees given by any person with
respect to any of the foregoing, and in any event, including, without
limitation, any and all (i) proceeds of any insurance, indemnity, warranty or
guarantee payable to Beneficiary or to such Trustor from time to time with
respect to any of the Trust Property, (ii) payments (in any form whatsoever)
made or due and payable to such Trustor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Trust Property by any governmental authority (or any person acting
under color of a governmental authority), (iii) products of the Trust Property,
(iv) other amounts from time to time paid or payable under or in connection with
any of the Trust Property, and (v) subject to the provisions and limitations
contained in the Indenture, whatever is now or hereafter receivable or received
by the Trustor upon the sale, exchange, collection or other disposition of any
item of Trust Property, whether voluntary or involuntary, including, without
limitation, the proceeds of a Permitted Disposition.
Notwithstanding the foregoing, the Trust Property shall not
include FF&E or the proceeds of an FF&E Financing (to the extent that (i) the
purchase of such FF&E was not financed with the proceeds of the Notes and (ii)
such Trustor is permitted to enter into an FF&E Financing for such FF&E under
the Indenture.
TO HAVE AND TO HOLD the Trust Property unto Trustee, its successors
and assigns forever, FOR THE PURPOSE OF SECURING, in such order of priority as
Trustee and Beneficiary may elect, the indebtedness and obligations described in
Section 1.3 hereof.
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Each Trustor, for itself and its successors and assigns, covenants and
agrees to and with Beneficiary that, at the time or times of the execution of
and delivery of these presents or any instrument of further assurance with
respect thereto, such Trustor has good right, full power and lawful authority to
assign, grant, convey, warrant, transfer, bargain or sell its interests in the
Trust Property in the manner and form as aforesaid, and that the Trust Property
is free and clear of all liens and encumbrances whatsoever, except the Permitted
Liens, and such Trustor shall warrant and forever defend the Trust Property in
the quiet and peaceable possession of Beneficiary and its successors and assigns
against all and every Person or Persons lawfully or otherwise claiming or to
claim the whole or any part thereof, except for the Permitted Liens. Each
Trustor agrees that any greater title to the Trust Property hereafter acquired
by such Trustor during the term hereof shall be automatically subject hereto.
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1.2 Status of Title; Defense of Actions and Costs.
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Each Trustor has the right to mortgage and convey the Trust Property
to Trustee and Beneficiary and will warrant and defend the same to Trustee and
Beneficiary and their respective successors and assigns against the lawful
claims and demands of every person or party whomsoever claiming or to claim the
same. Each Trustor agrees to protect, preserve and defend Trustee's and
Beneficiary's interests in the Trust Property and title thereto; to appear and
defend this Deed of Trust in any action or proceeding affecting or purporting to
affect the Trust Property, the lien or security interest of this Deed of Trust
thereon, or any of the rights of Trustee or Beneficiary hereunder, and to pay
all reasonable costs and expenses incurred by Trustee or Beneficiary in or in
connection with any such action or proceeding, including reasonable attorneys'
fees, whether or not any such action or proceeding progresses to judgment and
whether or not brought by or against Trustee or Beneficiary. Trustee and
Beneficiary shall be reimbursed for any such reasonable costs and expenses in
accordance with the provisions of this Deed of Trust and the other Transaction
Documents. Trustee or Beneficiary may, but shall not be under any obligation
to, appear or intervene in any such action or proceeding, retain counsel
therein, defend the same or otherwise take such action therein as it be advised
and may settle or compromise the same. In connection therewith Beneficiary or
Trustee, as the case may be, in that behalf and for any of such purposes, but
without obligation, may expend and advance such sums of money as it reasonably
may deem necessary, and shall be reimbursed therefor in accordance with the
provisions of this Deed of Trust and the other Transaction Documents.
1.3 Obligations Secured. This Deed of Trust is given for the purpose of
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securing the payment and performance in full when due (whether at stated
maturity, upon redemption or required repurchase, by acceleration or otherwise)
of all obligations of every type and nature of the Trustors to Trustee, any
other trustee under any other Deed of Trust, Beneficiary or any Holder
(including, without limitation, any and all amounts which may at any time be or
become due and payable and any and all interest accruing after the maturity of
the Notes and interest accruing after the filing of any petition in bankruptcy,
or the commencement of any insolvency, reorganization or like proceeding,
relating to either Trustor, whether or not a claim for post-filing or post-
petition interest is allowed in such proceeding and interest, to the extent
permitted by law, on the unpaid interest), whether direct or indirect, absolute
or contingent, due or to become due, or now existing or hereafter incurred,
which may arise under, out of, or in connection with, the Indenture, the Notes,
the Capital Completion Commitment, this Deed of Trust, the other Collateral
Documents, or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, premium, interest,
fees, Liquidated Damages, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the Trustee or to
the Holders that are required to be paid by the Trustors pursuant to the terms
of the Indenture, the Notes, the Completion Capital Commitment, this Deed of
Trust, any other Collateral Document, or any other document entered into by the
Trustors, or either of them, in connection with any of the foregoing
(collectively, the "Obligations"). Notwithstanding the scope of such
definition, however, for purposes of any provision of Title 38 of the Colorado
Revised Statutes, the only "original evidence of debt" secured by this
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Deed of Trust is the single counterpart of the Indenture which bears a legend in
the following form:
The counterpart of the Indenture on which this legend
appears is, for purposes of Title 38 of the Colorado Revised
Statutes, the "original evidence of debt" secured by the
Deed of Trust, as defined herein.
In no event shall Trustee require Beneficiary to produce any or all of the Notes
or other Loan Documents, other than the single counterpart of the Indenture
referred to above, to support Beneficiary's written request for full or partial
release of this Deed of Trust or for the sale of the Trust Property by Trustee
and each Trustor hereby waives any defense that such single counterpart of the
Indenture is not, for purposes of Title 38 of the Colorado Revised Statutes, the
"original evidence of debt" secured by this Deed of Trust. Each Trustor shall
pay and perform the Obligations at the times and places and in the manner
specified in the Notes, the Indenture and the other Transaction Documents. This
Deed of Trust shall secure unpaid balances of all loans and other such
extensions of credit made to either Trustor under the Transaction Documents,
whether made pursuant to an obligation of Beneficiary or any Holder to make such
loans or extensions or otherwise. Such Obligations and other extensions of
credit may or may not be evidenced by notes executed pursuant to the Indenture.
All future advances will have the same priority as the original advance. Any
agreement hereafter made by either Trustor and Beneficiary pursuant to this Deed
of Trust shall be superior to the rights of the holder of any intervening lien
or encumbrance to the extent allowed by law.
PROVIDED, HOWEVER, that if the principal and interest and all other
sums due or to become due under the Notes shall have been indefeasibly paid in
full at the time and in the manner stipulated herein and all other sums payable
hereunder and all other indebtedness secured hereby shall have been indefeasibly
paid in full, then in such case, the estate, right, title and interest of
Trustee and Beneficiary in the Trust Property shall cease, and upon written
notice from Beneficiary that all of the indebtedness secured hereby has been
indefeasibly paid in full, cancellation of the Notes, secured hereby, surrender
of this Deed of Trust and the Indenture to Trustee and payment by Trustors of
Trustee's fees and costs, all other amounts payable to Trustee hereunder and all
recording costs, Trustee shall release this Deed of Trust and the Trust Property
shall become wholly free of the liens, security interests, conveyances and
assignments created and evidenced hereby.
1.4 After-Acquired Property. If either Trustor hereafter acquires (a) any
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property that is of the kind or nature described in Section 1.1 hereof and is or
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is intended to become a part thereof, or (b) an interest in any of the Trust
Property greater than the interest now held, then such property or interest
shall, immediately upon such acquisition, become subject to the lien of this
Deed of Trust as fully and completely and with the same effect as though now
owned by such Trustor and specifically described herein, without need for the
delivery and/or recording of a supplement to this Deed of Trust or any other
instrument, all to the extent permitted by applicable law; but nevertheless such
Trustor shall from time to time, if requested by Beneficiary and at such
Trustor's expense, execute and deliver any and all such
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further assurances, conveyances and assignments thereof as Beneficiary may
reasonably require for the purpose of expressly and specifically subjecting to
the lien of this Deed of Trust any and all such property or interest.
1.5 Security Agreement; Fixture Filing. As additional security for the
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Obligations, each Trustor grants to Beneficiary a security interest in the Trust
Property. This Deed of Trust shall also, as to any part of the Trust Property
that may or might now or hereafter be deemed to be personal property, fixtures
or other property covered by Article 9 of the Colorado Uniform Commercial Code
(the "Personal Property"), be deemed to constitute a security agreement, and
each Trustor, as debtor, hereby grants to Beneficiary, as secured party, a
security interest therein pursuant to the Colorado Uniform Commercial Code. To
the extent that any Personal Property has been or may be acquired with funds
advanced under the Transaction Documents, this security interest granted
hereunder is a purchase money security interest. Each Trustor agrees, upon
request of Beneficiary, and at such Trustor's expense, to execute any
supplements to this Deed of Trust, any separate security agreement and any
financing statements and continuation statements in order to include
specifically said Personal Property or otherwise to perfect the security
interest granted hereby. Upon the occurrence and continuance of any Event of
Default, Beneficiary shall have all of the rights and remedies therein provided
or otherwise provided by law or by this Deed of Trust, including, but not
limited to the right to require Trustors, or either of them, to assemble the
Personal Property and make it available to the Beneficiary at a place to be
designated by Beneficiary which is reasonably convenient to both parties, the
right to take possession of such Personal Property with or without demand and
with or without process of law and the right to sell and dispose of the same and
distribute the proceeds according to law. The parties hereto agree that any
requirement of reasonable notice shall be met if Beneficiary sends such notice
to Trustors at least ten (10) days prior to the date of sale, disposition or
other event giving rise to the required notice, and that the proceeds of any
disposition of any such Personal Property may be applied by Beneficiary first to
the reasonable expenses in connection therewith, including reasonable attorneys'
fees and legal expenses incurred, and then to payment of the other Obligations.
The parties hereto further agree that any sale of the Personal Property held
contemporaneously with any sale of the Land or other Trust Property and upon the
same notice as required in the Colorado Uniform Commercial Code shall be deemed
to be a public sale conducted in a commercially reasonable manner. With respect
to any Personal Property that has become so attached to the real property
covered hereby that an interest therein arises under the real property law of
the State of Colorado, this Deed of Trust shall also constitute a financing
statement and a fixture filing under Sections 4-9-313 and 4-9-402(6) of the
Colorado Uniform Commercial Code.
ARTICLE II - COVENANTS CONCERNING THE TRUST PROPERTY
2.1 Taxes and Governmental Impositions.
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(a) Payment. Subject to Section 2.1(c), each Trustor will pay, or
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cause to be paid, prior to delinquency, all taxes, assessments, charges, fees
including gaming and liquor license fees, fines and impositions of every nature
whatsoever charged, imposed,
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levied or assessed or to be charged, imposed, levied or assessed upon or against
the Trust Property or any part thereof, or upon the interest of Trustee or
Beneficiary in the Trust Property, including without limitation (i) all income
taxes (excluding income taxes of Trustee or Beneficiary), assessments and other
governmental charges lawfully levied and imposed by the United States or any
state, county, municipality or other taxing or assessing authority in respect of
the Trust Property or any part thereof, (ii) all non-governmental levies or
assessments, such as maintenance charges, owner's association dues, charges or
fees, levies or charges resulting from covenants, conditions and restrictions
affecting the Trust Property or any part thereof, and (iii) any other charge
that, if unpaid, would or could become a lien or charge upon the Trust Property,
or any part thereof (all of which are hereinafter collectively referred to as
the "Impositions").
(b) Alternative Impositions. If at any time after the date hereof
-----------------------
there shall be assessed or imposed (i) a tax or assessment on either Trustor's
interest in the Trust Property in lieu of or in addition to the Impositions
payable by such Trustor pursuant to subparagraph (a) above, or (ii) a license
fee, tax or assessment imposed on Trustee or Beneficiary and measured by or
based in whole or in part upon the amount of the outstanding obligation secured
hereby (but excluding any state or federal income or franchise tax), then all
such taxes, assessments, or fees shall be deemed to be included within the term
"Impositions" as defined in Section 2.1(a) above, and such Trustor shall pay and
--------------
discharge the same as herein provided with respect to the payment of
Impositions.
(c) Contests. Each Trustor shall have the right, before the
--------
occurrence of any delinquency of any Imposition, to contest or object to the
amount or validity of any such Imposition by appropriate legal proceedings, but
such right shall not be deemed or construed in any way as relieving, modifying
or extending such Trustor's covenant to pay any such Imposition at the time and
in the manner provided in Section 2.1(a) hereof, unless such Trustor has given
--------------
prior written notice to Beneficiary of such Trustor's intent so to contest or
object to an Imposition, and unless: (i) the legal proceedings shall operate
conclusively to prevent the sale of the Trust Property, or any part thereof, to
satisfy such Impositions prior to final determination of such proceedings; or
(ii) such Trustor shall furnish a good and sufficient bond or surety in the
amount of the Impositions that are being contested, plus any interest and
penalty that may be imposed thereon and that could become a lien against the
Trust Property and in a manner to stay or prevent the sale, or other security
satisfactory to Beneficiary; or (iii) such Trustor shall have provided a good
and sufficient undertaking as may be required or permitted by law to accomplish
a stay of such proceedings; or (iv) such Trustor shall have paid such
Impositions under protest and is suing to recover any refunds thereof. Subject
to the foregoing, and if Beneficiary shall so request, within thirty (30) days
after the date when an Imposition is due and payable, each Trustor shall deliver
to Beneficiary evidence reasonably acceptable to Beneficiary showing the payment
of such Imposition. In the event that either Trustor contests or objects to an
Imposition in accordance with the foregoing, then such Trustor shall promptly
and diligently proceed to resolve the dispute concerning the Imposition in a
manner not prejudicial to Beneficiary or its rights hereunder or the Transaction
Documents.
11
(d) Payment by Beneficiary. Beneficiary shall have the right to pay
----------------------
any Imposition after the date such Imposition shall have become delinquent, if
either Trustor's failure to pay such Imposition constitutes or would constitute,
with or without the giving of notice by Beneficiary or the passage of time, an
Event of Default (unless such Trustor shall be contesting such Imposition
pursuant to Section 2.1(c) hereof), and to add to the Obligations the amount so
--------------
paid, together with interest thereon from the date of such payment at the then
applicable interest rate on the Notes plus 1% per annum (the "Default Rate") and
nothing herein contained shall affect such right and such remedy. Any sums paid
by Beneficiary or Trustee in discharge of any Impositions shall be (i) a future
advance hereunder and a lien on the Trust Property secured hereby prior to any
right or title to, interest in, or claim upon the Trust Property subordinate to
the lien of this Deed of Trust, and (ii) payable on demand.
(e) No Credit. Trustors shall not claim, demand or be entitled to
---------
receive any credit or credits towards the satisfaction of this Deed of Trust or
on any interest payable thereon for any taxes assessed against the Trust
Property or any part thereof, and shall not claim any deduction from the taxable
value of the Trust Property by reason of this Deed of Trust.
(f) Deposits for Impositions or Insurance Premiums. (i) At any time
----------------------------------------------
after the occurrence of an Event of Default, upon request by the Beneficiary,
the Trustors shall deposit with the Beneficiary (1) on the first day of each
month following such request a sum equal to 1/12 of the annual Impositions or
insurance premiums (as required by the Beneficiary) reasonably estimated by the
Beneficiary to become due with respect to the Trust Property for the ensuing
year, and (2) thirty (30) days prior to the next due date of any Impositions or
insurance premiums, an additional sum equal to the aggregate of the payments of
such Impositions or insurance premiums, less the aggregate of the amounts on
deposit and the amounts to be deposited pursuant to clause (1) of this
subsection (f)(i). If the amounts on deposit under this Section 2.1(f) shall
--------------
exceed the amounts required, the excess shall be credited to the subsequent
deposits to be made by the Trustors. If the amounts on deposit under this
Section 2.1(f) shall be insufficient, upon request, the Trustors shall
--------------
immediately deposit the deficiency with the Beneficiary. Except as required
under applicable law, the deposits under this Section 2.1(f) shall be for the
--------------
exclusive benefit of the Beneficiary and all right, title and interest in and to
such deposits shall be subject to the exclusive dominion and control of the
Beneficiary. In no event will Beneficiary be liable for any interest on any
amount so deposited. Beneficiary shall have no responsibility to ensure the
adequacy of the amounts deposited hereunder. At any time the Beneficiary may
notify the Trustors that it need no longer make deposits under this Section
-------
2.1(f), whereupon the Trustors shall cease making such deposits; provided that
------ --------
any such notice shall be without prejudice to the Beneficiary's right to require
thereafter that the Trustors make deposits under this Section.
(ii) If deposits are made under this Section 2.1(f), the Beneficiary
--------------
shall make payments of the Impositions or insurance premiums for which such
deposits are made as the same become due, but only following actual receipt by
the Beneficiary of the bills therefor, which the Trustors shall furnish to the
Beneficiary not later than ten (10) Business Days prior to the due date thereof,
and only to the extent that the amounts on deposit with
12
the Beneficiary at the time are sufficient to make such payments.
Notwithstanding the foregoing or the fact any amounts deposited under this
Section 2.1(f) may be deposited with respect to certain Impositions or insurance
--------------
premiums, the Beneficiary may use any amounts on deposit under this Section
-------
2.1(f) to pay any Impositions or insurance premiums as the same become due.
------
(iii) If an Event of Default or Default is continuing, the
Beneficiary shall have the right, but not the obligation, to apply the deposits
held under this Section toward the cure of such Event of Default or Default.
2.2 Mechanic's and Other Liens; Subrogation. Trustors will not suffer any
---------------------------------------
mechanic's, laborer's, materialmen's, statutory or other lien or any security
interest or encumbrance (including, without limitation, any deed of trust or
mortgage) to be created or to remain outstanding (other than Permitted Liens) on
any of the Trust Property. Trustors will promptly pay and discharge any and all
amounts which are now or hereafter become Liens against the Trust Property,
which Liens are not Permitted Liens, whether or not superior to the lien hereof
or to any assignment of rents and leases given to Beneficiary. The lien
covenants of this Section shall survive any foreclosure and sale of the Trust
Property and any conveyance thereof by deed in lieu of foreclosure with respect
to any such liens in existence as of the date of transfer of title. To the
extent that proceeds of the Notes and any other advances representing the
Obligations are used to pay indebtedness secured by any outstanding Lien or
prior encumbrance against the Trust Property, such proceeds have been advanced
at Trustors' request and Beneficiary shall be subrogated to any and all rights,
security interests and Liens owned by any owner or holder of such outstanding
Liens or encumbrances, irrespective of whether said Liens or encumbrances are
released and it is expressly understood that in consideration of the payment of
such indebtedness, each Trustor hereby waives and releases all demands and
causes of action for offsets, payments and rentals to, upon and in connection
with said indebtedness. Notwithstanding the foregoing, however, Trustors will
not be deemed to be in default under this Section if and so long as Trustors (a)
contest in good faith the validity or amount of any asserted lien and diligently
prosecute or defend an action appropriate to obtain a binding determination of
the disputed matter, and (b) provide Beneficiary with such security as
Beneficiary may in its reasonable discretion require to protect Beneficiary
against all loss, damage, and expense including, without limitation, attorneys'
fees, which Beneficiary might incur if the asserted lien is determined to be
valid.
2.3 Utilities. Trustors will pay, or cause to be paid, prior to
---------
delinquency any charges for utilities, whether public or private, with respect
to the Trust Property or any part thereof.
2.4 Insurance.
---------
(a) Maintenance. Trustors will obtain and maintain insurance with
-----------
respect to the Trust Property in accordance with the provisions of the
Indenture. From and after the entry of judgment of foreclosure, all rights and
powers of Beneficiary hereunder, and under
13
the Indenture to settle or participate in the settlement of losses under
policies of insurance or to hold and disburse or otherwise control use of
insurance proceeds shall continue in full force and effect in Beneficiary as
judgment creditor or mortgagee until confirmation of sale.
(b) Proceeds. If the Trust Property is materially damaged or
--------
destroyed, Trustors shall give prompt notice thereof to Beneficiary and all
insurance proceeds shall be paid to Trustors, or either of them, subject to the
terms of Section 4.30 of the Indenture.
2.5 Condemnation. Immediately upon obtaining knowledge of the institution
------------
of any proceedings for the condemnation of the Trust Property, or any material
portion thereof, Trustors will notify Beneficiary of the pendency of such
proceedings. All condemnation proceeds shall be applied in accordance with the
provisions of Section 4.30 of the Indenture.
2.6 Restoration. Restoration of any of the Trust Property after partial
-----------
or complete casualty or condemnation shall be performed in accordance with the
applicable provisions of the Indenture.
2.7 Care of the Trust Property.
--------------------------
(a) Preservation and Maintenance.
----------------------------
(i) Trustors will preserve and maintain the Trust Property in
accordance with the applicable provisions of the Indenture. Further, each
Trustor shall keep all of the Trust Property in good condition and repair and
expressly agrees that it will neither permit nor commit any waste upon the Trust
Property nor do any other act or suffer or permit any act to be done, whereby
the Lien hereof may be impaired. Trustors shall comply in all material respects
with all zoning laws, building codes, subdivision laws, gaming and liquor laws
including, without limitation, the Colorado Liquor Code and the Colorado Limited
Gaming Act and their respective regulations, and other applicable laws and shall
not become involved in conduct that would cause either the gaming or liquor
licenses to be suspended or revoked. Trustors agree not to initiate or
acquiesce in any zoning variance or reclassification which would prohibit the
use of the Trust Property for its intended purposes. Trustors shall at all
times comply in all material respects with applicable restrictive covenants and
the terms and conditions of all other Permitted Liens related to the Trust
Property. Notwithstanding anything above to the contrary, to the extent
expressly permitted by the Indenture, Trustors may remove or sell any fixture,
equipment, machinery or appliance in or on the Trust Property incident to the
replacement of such items with replacements leased or purchased by Trustors with
the proceeds of FF&E Financing.
(ii) Without granting to Trustors any right to incur Indebtedness
or Liens not expressly permitted by the Indenture, Trustors may make alterations
or construct other improvements on the Land to the extent not prohibited by the
Indenture or under any other documents creating a Lien on the Trust Property
(any of the foregoing are called herein a "Permitted Alteration"); provided that
--------
such work is done in a good and workmanlike manner, in compliance with all laws
including, without limitation, the Colorado Liquor Code and the Colorado Limited
Gaming Act.
14
(b) Notice of Damage. If the Trust Property or any part thereof is
----------------
materially damaged by fire or any other cause, Trustors will give prompt written
notice thereof to Beneficiary.
(c) Right to Inspect. Beneficiary or its representative is hereby
----------------
authorized, with reasonable advance notice to Trustors, to enter upon and
inspect the Trust Property at any time during normal business hours and at any
other reasonable time.
2.8 Future Tenants Leases.
---------------------
(a) Any future Tenants Leases permitted by the Indenture must be
subordinate to the lien of this Deed of Trust, unless otherwise permitted by the
Indenture. Each future Tenants Lease must contain a provision that, at
Beneficiary's election, upon notice to tenant by Beneficiary, such Tenants Lease
shall become superior, in whole or in part, to the lien of this Deed of Trust.
Further, each future Tenants Lease of real property shall obligate the tenant
thereunder to attorn, at the option of the purchaser of the Trust Property, to
any purchaser at foreclosure or other successor owner of the Trust Property.
(b) Each Trustor will furnish to Beneficiary a true and complete copy
of each Tenants Lease, amendment, modification, extension, or renewal of any
Tenants Lease hereafter made by such Trustor within thirty (30) days after
delivery of each such Tenants Lease, amendment, modification, extension, or
renewal by the parties thereto.
(c) Each Trustor shall, at such Trustor's cost and expense, perform
each and every material covenant, condition, promise and obligation on the part
of the lessor to be performed pursuant to the terms of each and every Tenants
Lease hereafter made with respect to the Trust Property or any part or parts
thereof.
(d) Each Trustor shall promptly furnish to Beneficiary any and all
material information which Beneficiary may request concerning the performance
and observance of all covenants, agreements and conditions contained in the
Tenants Leases by the lessor thereunder to be kept, observed and performed and
concerning the compliance with all terms and conditions of the Tenants Leases.
(e) In the event of any failure by either Trustor to keep, observe or
perform any material covenant, agreement or condition contained in the Tenants
Leases or to comply with the terms and conditions of any Tenants Leases, any
performance, observance or compliance by Beneficiary pursuant to this Deed of
Trust on behalf of such Trustor shall not remove or waive, as between such
Trustor and Beneficiary, the corresponding Default or Event of Default under the
terms of this Deed of Trust.
(f) Any proceedings or other steps taken by Beneficiary to foreclose
this Deed of Trust, or otherwise to protect the interests of Beneficiary
hereunder, shall not automatically operate to terminate the rights of any
present or future tenant under any Tenants Lease, notwithstanding that said
rights may be subject and subordinate to the lien of this Deed of Trust. The
failure to make any such tenant a defendant in any such foreclosure
15
proceeding and to foreclose such tenant's rights will not be asserted by either
Trustor or any other defendant in such foreclosure proceeding as a defense to
any proceeding instituted by Beneficiary to foreclose this Deed of Trust or
otherwise protect the interests of Beneficiary hereunder.
2.9 Further Encumbrance.
-------------------
(a) Each Trustor covenants that at all times prior to the discharge of
the Indenture, except for Permitted Liens, Permitted Dispositions and
dispositions permitted under Section 2.10, such Trustor shall neither make nor
------------
suffer to exist, nor enter into any agreement for, any sale, assignment,
exchange, mortgage, transfer, Lien, hypothecation or encumbrance of all or any
part of the Trust Property, including, without limitation, the Rents, Issues and
Profits. As used herein, "transfer" includes the actual transfer or other
disposition, whether voluntary or involuntary, by law, or otherwise, except
those transfers specifically permitted herein, provided, however, that
"transfer" shall not include the granting of utility or other beneficial
easements with respect to the Trust Property which have been granted by such
Trustor and are reasonably necessary to the construction, maintenance or
operation of the Project.
(b) Each Trustor agrees that in the event the ownership of the Trust
Property or any part thereof becomes vested in a Person other than such Trustor,
Beneficiary may, without notice to such Trustor, deal in any way with such
successor or successors in interest with reference to this Deed of Trust, the
Notes and other Obligations hereby secured without in any way vitiating or
discharging such Trustor's or any guarantor's, surety's or endorser's liability
hereunder or upon the Obligations hereby secured. No sale of the Trust Property
and no forbearance to any Person with respect to this Deed of Trust and no
extension to any Person of the time for payment of the Notes, and other sums
hereby secured given by Beneficiary shall operate to release, discharge, modify,
change or affect the original liability of such Trustor, or such guarantor,
surety or endorser either in whole or in part.
(c) This Deed of Trust, as applied to property subject to an FF&E
Financing, shall be subordinated to the liens of any FF&E Financing if required
by such FF&E Financing (or if required by an FF&E Financing, it shall be
released; provided that, upon the payment of the indebtedness represented by any
--------
such FF&E Financing, then the property previously subject thereto shall become
and be subject to this Deed of Trust thereafter) and any future or further
advances made thereunder and to any modifications, renewals or extensions
thereof to which the lien of this Deed of Trust attaches; provided, further,
-------- -------
however, that any such FF&E Financing shall encumber only that FF&E specifically
-------
subject to the FF&E Financing. Each Trustor covenants and agrees to comply with
all of the terms and conditions set forth in any FF&E Financing with respect to
which Beneficiary has taken a lien hereunder. If either Trustor shall fail to
make any payment of principal of or interest on the sums secured by such
security interest or any payment in order to perform or observe any other term,
covenant, condition or agreement of any FF&E Financing with respect to which
Beneficiary has taken a lien hereunder on its part to be performed or observed,
except where such Trustor is contesting such payment in good faith, then
Beneficiary may make such payment of the principal of or interest on the sums
secured by
16
such security interest or may make any payment in order to perform or observe
any other term, covenant, condition or agreement of any FF&E Financing on such
Trustor's part to be performed or observed and any and all sums so expended by
Beneficiary shall be Obligations and shall be secured by this Deed of Trust and
shall be repaid by such Trustor upon demand, together with interest thereon at
the Default Rate from the date of advance. In furtherance of such subordination
or release, as applicable, Beneficiary, upon receipt of an officer's certificate
from such Trustor certifying that the requirements of this Section 2.9(c) have
--------------
been satisfied, shall execute, acknowledge and deliver to such Trustor, at such
Trustor's expense, any and all such evidence and documents necessary to evidence
the subordination or release of this Deed of Trust in accordance with the
foregoing provisions of this Section 2.9(c).
--------------
2.10 Partial Releases of Trust Property.
----------------------------------
(a) Each Trustor may from time to time (i) transfer a portion of the
Trust Property (including any temporary taking) to any Person legally empowered
to exercise the power of eminent domain, (ii) make a Permitted Disposition, or
(iii) grant utility easements reasonably necessary for the construction and
operation of the Project, which grant or transfer is for the benefit of the
Trust Property. In each such case, and at Trustor's sole expense, Beneficiary
shall execute and deliver any instruments necessary or appropriate to effectuate
or confirm any such transfer or grant, free from the lien of this Deed of Trust;
provided, however, that Beneficiary shall execute a lien release or
-------- -------
subordination agreement, as appropriate, for matters described in clauses (i)
and (iii) above only if:
(A) Beneficiary shall have received an Officer's Certificate or
Opinion of Counsel required or authorized by Section 10.4 of the Indenture;
(B) No Default or Event of Default shall have occurred and be
continuing and the conditions of this Section 2.10 have been fulfilled, and
------------
such transfer, grant or release is permitted by the Indenture;
(C) Beneficiary shall have received a counterpart of the
instrument pursuant to which such transfer, grant or release is to be made,
and each instrument which Beneficiary is requested to execute in order to
effectuate or confirm such transfer, grant or release;
(D) Beneficiary shall have received such other instruments,
certificates (including evidence of authority) and opinions as Beneficiary
may reasonably request or as required or authorized under the Indenture,
including, but not limited to, opinions that the proposed release is
permitted by this Section 2.10.
------------
(b) Any consideration received for a transfer to any Person empowered
to exercise the right of eminent domain shall be subject to Section 2.5 hereof.
-----------
17
ARTICLE III - ASSIGNMENT OF LEASES AND RENTS
3.1 Assignment of Leases and Rents. As additional consideration for the
------------------------------
Obligations, each Trustor hereby absolutely and unconditionally assigns and
transfers to Beneficiary the following:
(a) the Tenants Leases;
(b) any and all guaranties of the obligations of the tenants (the
"Tenants") under any of such Tenants Leases; and
(c) the immediate and continuing right to collect and receive all of
the Rents, Issues and Profits now due or that may become due or to which such
Trustor may now or hereafter (whether during any applicable period of
redemption, or otherwise) become entitled or may demand or claim, arising or
issuing from or out of the Tenants Leases, or from or out of the Trust Property
or any part thereof.
3.2 Trustors' Limited License. Provided that no Event of Default
-------------------------
hereunder exists, each Trustor shall have the right under a license granted
hereby and Beneficiary hereby grants to such Trustor a license to collect, but
not more than one month in advance, all of the Rents, Issues and Profits arising
from or out of the Tenants Leases or any renewals or extensions thereof, or from
or out of the Trust Property or any part thereof, but only as trustee for the
benefit of Beneficiary. Each Trustor shall apply the Rents, Issues and Profits
so collected first to payment of any and all amounts due and payable under the
Indenture. Thereafter, so long as no Event of Default hereunder exists, such
Trustor may use the Rents, Issues and Profits in any manner not inconsistent
with the Indenture. The license granted hereby shall be revoked automatically
upon the occurrence of an Event of Default hereunder.
3.3 Limitation. The acceptance by Beneficiary of the assignment provided
----------
in this Article III, together with all of the rights, powers, privileges and
-----------
authority created in this Article III or elsewhere in this Deed of Trust, shall
-----------
not, prior to entry upon and taking possession of the Trust Property by
Beneficiary, be deemed or construed to constitute Beneficiary a "mortgagee in
possession," nor thereafter or at any time or in any event obligate Beneficiary
to appear in or defend any action or proceeding relating to the Tenants Leases,
the Rents, Issues and Profits or the Trust Property or to take any action
hereunder or to expend any money or incur any expenses or perform or discharge
any obligation or responsibility for any security deposits or other deposits
delivered to either Trustor by any Tenant and not assigned and delivered to
Beneficiary, nor shall Beneficiary be liable in any way for any injury or damage
to person or property sustained by any person or persons, firm or corporation in
or about the Trust Property.
3.4 Performance by Trustors. Each Trustor shall perform its obligations
-----------------------
under the Tenants Leases in accordance with their terms. Each Trustor shall not
default in the performance of any obligation of such Trustor under any Tenants
Lease if, by reason of such default, the Tenant or other party thereunder has
the right to cancel such Tenants Lease or to claim any diminution or offset
against future Rents, Issues or Profits.
18
3.5 No Merger of Leases. If the estates of all parties to any Tenants
-------------------
Lease shall at any time become vested in one owner, this Deed of Trust and the
lien created hereby shall not be destroyed or terminated by application of the
doctrine of merger, and in such event, Beneficiary shall continue to have and
enjoy all of the rights and privileges of Beneficiary as to the separate
estates. In addition, upon the foreclosure of the lien created by this Deed of
Trust, any Tenants Leases then existing and affecting all or any portion of the
Trust Property shall not be destroyed or terminated by application of the law of
merger or as a matter of law or as a result of such foreclosure, unless
Beneficiary or any purchaser at any such foreclosure sale shall so elect in
writing. No act by or on behalf of Beneficiary or any such purchaser shall
constitute a termination of any Tenants Lease or sublease unless Beneficiary or
such purchaser shall give written notice thereof to the lessee or sublessee
under such Tenants Lease.
3.6 Remedies. If an Event of Default has occurred and is continuing, in
--------
addition to all other rights and remedies of Beneficiary as set forth under
Article IV hereof, Beneficiary shall have the following rights and remedies:
----------
(a) Possession and/or Collection of Rent. Beneficiary, without first
------------------------------------
being required to (i) foreclose, (ii) take any actions to foreclose, (iii)
institute any legal proceedings of any kind whatsoever or (iv) exercise any
other actions or remedies hereunder or at law or in equity, shall have the
exclusive right and power (but not the obligation) (A) to enter upon and take
possession of the Trust Property or any part thereof, (B) to rent or re-rent the
same, either in the name of Beneficiary or Trustors, or either of them, and/or
(C) to receive all Rents, Issues and Profits from the Trust Property.
Beneficiary shall apply any Rents, Issues and Profits received by Beneficiary
first, to the costs and expenses incurred by Beneficiary in protecting and
operating the Trust Property, and next, to the payment of the Obligations in
such manner and in such order of priority as Beneficiary shall determine
consistent with the provisions of the Indenture. Any such action by Beneficiary
shall not operate as a waiver of the Event of Default in question, or as an
affirmance of any Tenants Leases or of the rights of any Tenant in the event
title to that part of the Trust Property covered by the Tenants Leases or held
by the Tenant should be acquired by Beneficiary or other purchaser at a
foreclosure sale. The right of Beneficiary to receive all Rents, Issues and
Profits from the Trust Property upon the occurrence and during the continuance
of any Event of Default shall be applicable whether or not Beneficiary has
entered upon, foreclosed, taken any actions to foreclose or taken possession of
the Trust Property, whether or not Beneficiary has instituted any legal
proceedings of any kind whatsoever, or whether or not Beneficiary has otherwise
attempted to exercise any other actions or remedies hereunder or at law or in
equity. If any such Rents, Issues and Profits are paid to or received by either
Trustor, such Trustor shall hold same in trust for Beneficiary and immediately
pay the same to Beneficiary (in the form received, except for any necessary
endorsement), without the necessity of any request or demand therefor. Until
receipt from Beneficiary of notice of the occurrence of an Event of Default
hereunder and during the continuance thereof, all Tenants of the Tenants Leases
and any successors to the leasehold interest of such Tenants may pay Rents,
Issues and Profits directly to such Trustor, but after notice of the occurrence
of any Event of Default and during the continuance of same, such Trustor
covenants to and shall hold all Rents, Issues and Profits paid to such Trustor
in trust for Beneficiary. Each Trustor hereby authorizes and
19
directs all Tenants of the Tenants Leases herein described, and any successors
to the leasehold interest of said Tenants, upon receipt of any notice from
Beneficiary stating that an Event of Default hereunder has occurred, to pay to
Beneficiary the Rents, Issues and Profits due and to become due under said
Tenants Leases. Each Trustor agrees that said Tenants shall have the right to
rely upon any such notice and request by Beneficiary without any obligation or
right to inquire as to whether an Event of Default actually exists and
notwithstanding any notice from or claim of such Trustor to the contrary, and
such Trustor shall have no right or claim against said Tenants for any such
Rents, Issues and Profits so paid by the Tenants to Beneficiary. In such event,
receipt by Beneficiary of Rents, Issues and Profits from such Tenants or their
successors shall be a release of such Tenants or their successors to the extent
of all amounts so received by Beneficiary.
(b) Management. Beneficiary, at its option, may take over and assume
----------
the management, operation and maintenance of the Trust Property and perform all
acts necessary and proper and expend such sums out of the income of the Trust
Property as may be needful in connection therewith including applying for
appropriate approvals from the Liquor and Gaming License Authorities, in the
same manner and to the same extent as Trustors theretofore might do, including,
without limitation, the right to enter into new leases, to cancel or surrender
existing Tenants Leases, to alter or amend the terms of existing Tenants Leases,
to renew existing Tenants Leases, or to make concessions to Tenants. Each
Trustor hereby releases all claims against Beneficiary arising out of such
management, operation and maintenance, including, without limitation, such
claims as may arise from the negligence of Beneficiary, but not the gross
negligence or willful misconduct of Beneficiary and not any liability of
Beneficiary to account as hereinafter set forth.
(c) Receiver. Upon or at any time after the occurrence of any Event
--------
of Default, Beneficiary shall at once become entitled to the possession, use and
enjoyment of the Trust Property and the Rents, Issues and Profits, from the date
of such occurrence and continuing during the pendency of any proceedings for
sale by the public trustee or foreclosure proceedings, and the period of
redemption, if any. Beneficiary shall be entitled to a receiver for the Trust
Property, and of the Rents, Issues and Profits, after any such default,
including, without limitation, the time covered by any proceedings for sale by
the public trustee or foreclosure proceedings and the period of redemption, if
any. Beneficiary shall be entitled to such receiver as a matter of right,
without regard to the solvency or insolvency of Trustors, or of the then owner
of the Trust Property, and without regard to the value thereof, and such
receiver may be appointed by any court of competent jurisdiction upon ex parte
-- -----
application, and without notice, notice being hereby expressly waived. All
Rents, Issues and Profits, income and revenue therefrom shall be applied by such
receiver to the payment of the Obligations according to the orders and
directions of the court, or in the absence of such orders or directions, in the
manner set forth in Section 3.7 below.
-----------
3.7 Application of Income. Beneficiary shall, after payment of all proper
---------------------
charges and expenses, including reasonable compensation to any managing agent as
it shall select and employ, and after the accumulation of a reserve to meet
taxes, assessments and insurance as herein required in requisite amounts, credit
the net amount of income received by it from the Trust Property by virtue of
this absolute assignment to any amounts due and owing to it by
20
Trustors under the terms hereof, but the manner of the application of said net
income and what items shall be credited shall be determined pursuant to the
Indenture, or otherwise in the sole discretion of Beneficiary. Without
impairing its rights hereunder, Beneficiary may, at its option, at any time and
from time to time, release to Trustors Rents, Issues and Profits received by
Beneficiary, or any portion of such Rents, Issues and Profits. Beneficiary
shall not be liable for its failure to collect, or its failure to exercise
diligence in the collection of Rents, Issues and Profits, but shall be
accountable only for Rents, Issues and Profits that Beneficiary shall actually
receive. Beneficiary shall not be accountable for more monies than it actually
receives from the Trust Property nor shall it be liable for failure to collect
Rents, Issues and Profits.
3.8 Term. This absolute assignment shall remain in full force and effect
----
so long as the Obligations or any part thereof to Beneficiary remains unpaid or
unsatisfied, in whole or in part.
3.9 Actions of Trustee. All provisions hereof shall inure to the benefit
------------------
of and all actions authorized hereunder shall be exercisable by Trustee or any
substitute Trustee at Beneficiary's request.
3.10 PARTIES INTENT. AS BETWEEN BENEFICIARY AND TRUSTORS, AND ANY PERSON
--------------
OR ENTITY CLAIMING THROUGH OR UNDER TRUSTORS, OTHER THAN ANY TENANT UNDER ANY OF
THE TENANTS LEASES (OR THE SUCCESSOR OF ANY SUCH TENANT) WHO HAS NOT RECEIVED
ANY NOTICE OF AN EVENT OF A DEFAULT HEREUNDER, THE ASSIGNMENT CONTAINED IN THIS
ARTICLE III IS INTENDED TO BE ABSOLUTE, UNCONDITIONAL AND PRESENTLY EFFECTIVE,
-----------
AND THESE PROVISIONS ARE INTENDED SOLELY FOR THE BENEFIT OF EACH TENANT UNDER
ANY OF THE TENANTS LEASES (OR THE SUCCESSOR OF ANY SUCH TENANT) AND SHALL NEVER
INURE TO THE BENEFIT OF TRUSTORS OR ANY PERSON CLAIMING THROUGH OR UNDER
TRUSTORS, OTHER THAN A TENANT UNDER ANY OF THE TENANTS LEASES (OR THE SUCCESSOR
OF ANY SUCH TENANT) WHO HAS NOT RECEIVED SUCH NOTICE. IT SHALL NEVER BE
NECESSARY FOR BENEFICIARY TO INSTITUTE LEGAL PROCEEDINGS OF ANY KIND WHATSOEVER
OR TO TAKE ANY OTHER ACTIONS HEREUNDER OR AT LAW OR IN EQUITY TO ENFORCE THE
PROVISIONS OF THIS ARTICLE III.
-----------
ARTICLE IV - DEFAULTS AND REMEDIES
4.1 Events of Default. An Event of Default shall mean the occurrence of
-----------------
any Event of Default set forth in Annex A attached hereto.
4.2 Performance of Defaulted Acts. From and after the occurrence of an
-----------------------------
Event of Default, Beneficiary may (without prejudice to its other rights and
remedies), but need not, make any payment or perform any act required of
Trustors herein or in the Indenture, or in any other Transaction Document in any
form and manner deemed expedient, including,
21
without limitation, making full or partial payments of principal or interest on
prior encumbrances, if any, and purchasing, discharging, compromising or
settling any tax lien or other prior lien or title or claim thereof, or
redeeming from any tax sale or forfeiture affecting the Trust Property or
contesting any tax or assessment. All moneys paid for any of the purposes
herein authorized and all expenses paid or incurred in connection therewith,
including reasonable attorneys' fees (including reasonable fees of in-house
counsel), shall be included among the Obligations and shall be due and payable
upon demand and with interest thereon from the date of such payment or expense
at the Default Rate. Inaction of Beneficiary shall never be considered as a
waiver of any right accruing to it hereunder on account of any default on the
part of either Trustor. Beneficiary, in making any payment hereby authorized
relating to taxes or assessments, may do so according to any xxxx, statement or
estimate procured from the appropriate public office without inquiry into the
accuracy of such xxxx, statement or estimate or into the validity of any tax,
assessment, sale, forfeiture, tax lien or title or claim thereof.
4.3 Remedies. Upon the occurrence of any Event of Default, Beneficiary
--------
may, at its option (in each case, subject to and in accordance with any
applicable terms of the Indenture):
(a) in accordance with and subject to the terms of the Indenture,
declare all sums secured hereby to be immediately due and payable, and the same
shall thereupon become immediately due and payable without any presentment,
demand, protest or notice of any kind;
(b) terminate each Trustor's right and license to collect the Rents,
Issues and Profits and either in person or by agent, with or without bringing
any action or proceeding, or by a receiver appointed by a court, and without
regard to the adequacy of its security, enter upon and take possession of the
Trust Property, or any part thereof, in its own name or in the name of Trustee,
and do any acts which it deems necessary or desirable to preserve the value,
marketability or rentability of the Trust Property, or any part thereof or
interest therein, make, modify, enforce, cancel or accept the surrender of any
Tenants Lease, take actions which may affect the income therefrom or protect the
security hereof, and with or without taking possession of the Trust Property,
xxx for or otherwise collect the Rents, Issues and Profits, including, without
limitation, those past due and unpaid, and apply the same, less costs and
expenses of operation and collection, including, without limitation, reasonable
attorneys' fees (including reasonable charges for in house counsel), upon any
Obligations secured hereby, all in such order as Beneficiary may determine.
From and after receipt of written instrument from Beneficiary to pay Rents,
Issues and Profits directly to Beneficiary or another party designated by
Beneficiary, each Tenant shall pay all such payments under its Tenants Lease in
the manner instructed by Beneficiary. The entering upon and taking possession
of the Trust Property or any portion thereof, the collection of the Rents,
Issues and Profits and the application thereof as aforesaid, or any of such
acts, shall not cure or waive any default or notice of default hereunder or
invalidate any act done in response to such default or pursuant to such notice,
and notwithstanding the continuance in possession of the Trust Property or the
collection, receipt and application of the Rents, Issues and Profits, Trustee or
Beneficiary shall be entitled to exercise every right provided for in
22
any of the Indenture, the Notes, or the other Transaction Documents or by law
upon the occurrence of any Event of Default, including, without limitation, the
right to exercise the power of sale provided herein;
(c) notwithstanding the availability of legal remedies, obtain
specific performance, mandatory or prohibitory injunctive relief, or other
equitable relief requiring Trustors to cure or refrain from repeating any
default;
(d) with or without accelerating the maturity of the Obligations, xxx
from time to time for any payment due under any of the Indenture, the Notes or
the other Transaction Documents, or for money damages resulting from any
Trustor's default under any of the Indenture, the Notes or the other Transaction
Documents;
(e) exercise all rights and remedies set forth in Section 1.5 and all
-----------
rights of a secured party under the Uniform Commercial Code;
(f) foreclose this Deed of Trust, insofar as it encumbers the Trust
Property, by way of a trustee's sale pursuant to the provisions of Title 38,
Article 38, Colorado Revised Statutes, as currently in effect, as amended, or in
any other manner then permitted by law. If this Deed of Trust encumbers more
than one parcel of real estate, foreclosure may be by separate parcel or en
--
masse, as Beneficiary may elect in its sole discretion. Foreclosure through
-----
Trustee will be initiated by Beneficiary's filing of its notice of election and
demand for sale with Trustee. Upon the filing of such notice of election and
demand for sale, Trustee shall promptly comply with all notice and other
requirements of the laws of Colorado then in force with respect to such sales,
and shall give four weeks' public notice of the time and place of such sale by
advertisement weekly in some newspaper of general circulation then published in
the County or City and County in which the Trust Property is located. The right
to foreclose this Deed of Trust as a mortgage by appropriate proceedings in any
court of competent jurisdiction is also hereby given;
(g) exercise all other rights and remedies provided herein, in the
Indenture, the Notes, the other Transaction Documents or in any other document
or agreement now or hereafter securing all or any portion of the Obligations, or
at law or in equity, or any combination of any such rights or remedies, to the
extent permitted by law.
Upon request by Beneficiary, Trustors shall assemble and make available to
Beneficiary at the Land any of the Trust Property which is not located on the
Land or which has been removed therefrom.
4.4 Foreclosure.
-----------
(a) All fees, costs and expenses of any kind incurred by Beneficiary
in connection with foreclosure of this Deed of Trust, including, without
limitation, the costs of any appraisals of the Trust Property obtained by
Beneficiary, all costs of any receivership for the Trust Property advanced by
Beneficiary, and all reasonable attorneys' and consultants'
23
fees incurred by Beneficiary, appraisers' fees, outlays for documentary and
expert evidence, stenographers' charges, publication costs and costs (which may
be estimates as to items to be expended after entry of the decree) of procuring
all such abstracts of title, title searches and examination, title insurance
policies and similar data and assurances with respect to title, as Trustee or
Beneficiary may reasonably deem necessary either to prosecute such suit or to
evidence to bidders at the sales that may be had pursuant to such proceedings
the true conditions of the title to or the value of the Trust Property, together
with and including a reasonable compensation to Trustee, shall constitute a part
of the Obligations and may be included as part of the amount owing from Trustors
to Beneficiary at any foreclosure sale.
(b) The proceeds of foreclosure sale of the Trust Property shall be
distributed and applied in the following order of priority: first, on account
of all costs and expenses incident to the foreclosure proceedings, including,
without limitation, all such items as are mentioned in Section 4.4(b) hereof;
--------------
second, to the payment of all sums expended under the terms hereof not then
repaid, with accrued interest at the Default Rate; third, to the payment of all
other Obligations; and lastly, the remainder, if any, to the person or persons
legally entitled thereto.
(c) In case of an insured loss after judicial foreclosure or Trustee's
sale proceedings have been instituted, the proceeds of any insurance policy or
policies, if not applied to rebuilding or restoring the buildings or
improvements, shall be used to pay the amount due upon the Obligations. In the
event of judicial foreclosure or Trustee's sale, Beneficiary or Trustee is
hereby authorized, without the consent of Trustors, to assign any and all
insurance policies to the purchaser at the sale, or to take such other steps as
Beneficiary or Trustee may deem advisable to cause the interest of such
purchaser to be protected by any of the said insurance policies.
(d) To the fullest extent allowable by law, each Trustor hereby
expressly waives any right which it may have to direct the order in which any
Trust Property shall be sold in the event of any sale or sales pursuant to this
Deed of Trust.
(e) Nothing in this Section dealing with foreclosure procedures or
specifying particular actions to be taken by Beneficiary or by Trustee or any
similar officer shall be deemed to contradict or add to the requirements and
procedures now or hereafter specified by Colorado law, and any such
inconsistency shall be resolved in favor of Colorado law applicable at the time
of foreclosure.
4.5 Rescission of Notice of Default. Beneficiary may from time to time
-------------------------------
withdraw any notice of election and demand for sale in accordance with Section
38-38-101(11) of the Colorado Revised Statutes. The exercise by Beneficiary of
such right shall not constitute a waiver of any breach or default then existing
or subsequently occurring, or impair the right of Beneficiary to execute and
deliver to Trustee, as above provided, other declarations or notices of default
to satisfy the Obligations under this Deed of Trust or the other Obligations,
nor otherwise affect any provision, covenant or condition of any of the
Indenture, the Notes or the other Transaction Documents or any of the rights,
obligations or remedies of Trustee or Beneficiary hereunder or thereunder.
24
4.6 Appointment of Receiver. Each Trustor waives any right to any hearing
-----------------------
or notice of hearing prior to the appointment of a receiver. Such receiver and
its agents shall be empowered (a) to take possession of the Trust Property and
any businesses conducted by Trustors or any other person (excluding the business
of tenants of Trustors) thereon and any business assets used in connection
therewith and, if the receiver deems it appropriate, to operate the same, (b) to
exclude Trustors and Trustors' agents, servants, and employees from the Trust
Property, (c) to collect the rents, issues, profits, and income therefrom, (d)
to complete any construction which may be in progress, (e) to do such
maintenance and make such repairs and alterations as the receiver deems
necessary, (f) to use all stores of materials, supplies, and maintenance
equipment on the Trust Property, (g) to pay all taxes and assessments against
the Trust Property and all premiums for insurance thereon, (h) to pay all
utility and other operating expenses, and all sums due under any prior or
subsequent encumbrance, and (i) generally to do anything which Trustors could
legally do if Trustors were in possession of the Trust Property. All expenses
incurred by the receiver or his agents shall constitute a part of the
Obligations. Any revenues collected by the receiver shall be applied first to
the expenses of the receivership, including attorneys' fees incurred by the
receiver and by Beneficiary, together with interest thereon at the Default Rate
from the date incurred until repaid, and the balance shall be applied toward the
Obligations or in such other manner as the court may direct. Unless sooner
terminated with the express consent of Beneficiary, any such receivership will
continue until the Obligations have been discharged in full, or until title to
the Trust Property has passed after foreclosure sale and all applicable periods
of redemption have expired.
4.7 Remedies Not Exclusive; Waiver.
------------------------------
(a) Trustee and Beneficiary, and each of them, shall be entitled to
enforce the payment and performance of any Obligations and to exercise all
rights and powers under this Deed of Trust or under any other Transaction
Document or other agreement or any laws now or hereafter in force,
notwithstanding the fact that some or all of the Obligations may now or
hereafter be otherwise secured, whether by mortgage, deed of trust, pledge,
lien, assignment or otherwise. Neither the acceptance of this Deed of Trust nor
its enforcement, whether by court action or pursuant to the power of sale or
other powers contained herein, shall prejudice or in any manner affect Trustee's
or Beneficiary's right to realize upon or enforce any other rights or security
now or hereafter held by Trustee or Beneficiary. Trustee and Beneficiary, and
each of them, shall be entitled to enforce this Deed of Trust and any other
rights or security now or hereafter held by Beneficiary or Trustee in such order
and manner as they or either of them may in their absolute discretion determine.
No remedy herein or by law provided or permitted shall be exclusive of any other
remedy, but each shall be cumulative and in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity. Every power or
remedy given by any of the Transaction Documents to Trustee or Beneficiary, or
to which either of them may be otherwise entitled, may be exercised,
concurrently or independently, from time to time and as often as may be deemed
expedient by Trustee or Beneficiary, and either of them may pursue inconsistent
remedies. By exercising or by failing to exercise any right, option or election
hereunder, Beneficiary shall not be deemed to have waived any provision hereof
or to have released either Trustor from any of the Obligations secured hereby
unless such waiver or release is in
25
writing and signed by Beneficiary. The waiver by Beneficiary of either
Trustor's failure to perform or observe any term, covenant, or condition
referred to or contained herein to be performed or observed by such Trustor
shall not be deemed to be a waiver of such term, covenant or condition on any
other occasion or any subsequent failure of such Trustor to perform or observe
the same or any other such term, covenant or condition referred to or contained
herein, and no custom or practice which may develop between such Trustor and
Beneficiary during the term hereof shall be deemed a waiver of or in any way
affect the right of Beneficiary to insist upon the performance by such Trustor
of the Obligations secured hereby in strict accordance with the terms hereof or
any other Transaction Document.
4.8 Casino. Each Trustor acknowledges that part of the Trust Property
------
consists of a casino and gaming property (the "Casino") which is subject to
Gaming Laws and the jurisdiction of the Gaming Authorities and that, under the
applicable Gaming Laws, the operation of the Casino by a person other than a
person properly licensed by the Gaming Authorities to operate a casino and
gaming business (a "Licensee") is prohibited and may result in the closing of
the Casino, the loss of customers, employees, revenues and good will, and the
severe diminution in the value of the Trust Property, all to the economic
jeopardy and extreme detriment of Beneficiary. In order to mitigate such
adverse consequences, each Trustor agrees that, if an Event of Default is
continuing, either before or after seeking an appointment of a receiver, in
addition to any other right or remedy available to Beneficiary hereunder or
under applicable law (but subject to any applicable requirements of the
applicable Gaming Laws), (a) Beneficiary shall have the right to solicit any
Licensee or other person with the capacity to become a Licensee to purchase,
lease and/or operate the Casino as a receiver of the Trust Property, as a
supervisor of the Casino, as a purchaser of the Trust Property or Casino at any
foreclosure sale, or in any other appropriate capacity permitted under the
applicable Gaming Laws; (b) any such Licensee or other person and Beneficiary
may, to the extent permitted under the applicable Gaming Laws, apply to and
appear before the Gaming Authorities and any other appropriate authority for a
license or a finding of suitability to permit such Licensee or other person to
operate the Casino; and (c) each Trustor shall cooperate fully with any action
taken by Beneficiary and any such Licensee or other person pursuant to this
Section 4.8.
-----------
4.9 Multiple Collateral.
-------------------
(a) No recovery of any judgment by Trustee or Beneficiary and no levy
of an execution under any judgment upon the Trust Property or upon any property
of Trustors encumbered by any other Collateral Document shall affect in any
manner or to any extent the lien of this Deed of Trust upon the Trust Property
or any part thereof, and any liens, rights, powers and remedies of Trustee or
Beneficiary shall continue unimpaired.
(b) Each Trustor agrees that it shall not at any time insist upon,
plead, seek or in any manner whatever claim or take any benefit or advantage of
a judgment, declaration or a determination that:
26
(i) the Trust Property or any other property of either Trustor
encumbered by a Transaction Document represents, on an individual basis, an
allocable portion of the then outstanding aggregate principal amount of the
Notes or the Obligations;
(ii) a surplus results from an action taken by Trustee or
Beneficiary against the Trust Property or any other property of either Trustor
encumbered by a Transaction Document to recover the Obligations or any portion
thereof;
(iii) the lien of this Deed of Trust or of any other Transaction
Document has been released, unless the Obligations have been satisfied and paid
in full;
(iv) a deficiency judgment with respect to any action taken by
Trustee or Beneficiary against the Trust Property or any other property of
either Trustor encumbered by a Transaction Document extinguishes all or any
portion of the remaining Obligations, or precludes Trustee or Beneficiary from
proceeding against the Trust Property or to satisfy such remaining Obligations;
or
(v) Trustee's or Beneficiary's commencement, prosecution, or
taking to judgment of any action (including, without limitation, Trustee's or
Beneficiary's acceptance of a deed in lieu of foreclosure) or Trustee's or
Beneficiary's application for or use of any remedy (including, without
limitation, the appointment of a receiver for the Trust Property or any other
property of either Trustor encumbered by a Transaction Document) against the
Trust Property or any other property of either Trustor encumbered by a
Transaction Document precludes or bars Trustee or Beneficiary (under a "single
action" rule, "security first" rule or similar rule) from commencing,
prosecuting or taking to judgment any other action or applying for or using any
remedy against the Trust Property or any other property of either Trustor
encumbered by a Transaction Document.
(c) Beneficiary may, at its option, in such order, and utilizing such
combinations of remedies with respect to the Trust Property and/or any other
property of Trustors encumbered by a Transaction Document as Beneficiary shall
so elect, pursue its remedies against (i) the Trust Property, individually, or
any other property of Trustors encumbered by a Transaction Document,
individually; (ii) the Trust Property and any combination of the other property
of Trustors encumbered by a Transaction Document; (iii) the Trust Property and
all of the other property of Trustors encumbered by a Transaction Document; or
(iv) all or any combination of the other property of Trustors encumbered by a
Transaction Document, in separate proceedings or in one proceeding in any order
which Beneficiary deems appropriate.
4.10 Extensions and Partial Payments. Each Trustor agrees that without
-------------------------------
affecting the liability of any person for payment of the Obligations or
affecting the lien of this Deed of Trust upon the Trust Property or any part
thereof Beneficiary may at any time and from time to time, on request of such
Trustor, without notice to any person liable for payment of any Obligations,
extend the time or agree to alter the terms of payment of all or any part of
such Obligations. Acceptance by Beneficiary of any payment in an amount less
than the amount then due on the Obligations shall be deemed an acceptance on
account only, and the failure
27
to pay the entire amount then due shall continue to be an Event of Default
hereunder. At any time thereafter and until the entire amount then due on the
Obligations has been paid, Beneficiary shall be entitled to exercise all rights
conferred upon it in this Deed of Trust upon the occurrence of an Event of
Default hereunder.
4.11 Protective Advances. All advances, disbursements and expenditures
-------------------
made or incurred by Beneficiary before and during a foreclosure, and before and
after judgment of foreclosure, and at any time prior to sale, and, where
applicable, after sale, and during the pendency of any related proceedings, for
the following purposes, in addition to those otherwise authorized by this Deed
of Trust or by applicable law (collectively "Protective Advances"), shall have
the benefit of all applicable provisions of law, including, without limitation,
those referred to below:
(a) all advances by Beneficiary in accordance with the terms of this
Deed of Trust to: (i) preserve, maintain or repair any Trust Property, or
restore or rebuild the improvements upon the Trust Property; (ii) preserve the
lien of this Deed of Trust or the priority hereof; or (iii) enforce this Deed of
Trust;
(b) payments by Beneficiary of: (i) principal, interest or other
obligations in accordance with the terms of any prior lien or encumbrance on the
Trust Property; (ii) real estate taxes and assessments, general and special and
other taxes and assessments of any kind or nature whatsoever that are assessed
or imposed upon the Trust Property or any part thereof; (iii) amounts in
connection with any Tenants Lease pursuant to Section 4.3 hereof; (iv) other
-----------
obligations authorized by this Deed of Trust; or (v) any other amounts in
connection with other liens, encumbrances or interests reasonably necessary to
preserve the status of title to the Trust Property;
(c) advances by Beneficiary in settlement or compromise of any claims
asserted by claimants under any prior liens;
(d) reasonable attorneys' fees and other costs incurred (including
reasonable charges for in house counsel): (i) in connection with a judicial
foreclosure or trustee's sale; (ii) in connection with any action, suit or
proceeding brought by or against Beneficiary for the enforcement of this Deed of
Trust or arising from the interest of Beneficiary hereunder; or (iii) in
preparation for or in connection with the commencement, prosecution or defense
of any other action that could materially adversely affect the lien of this Deed
of Trust or the Trust Property;
(e) expenses deductible from proceeds of sale; and
(f) expenses incurred and expenditures made by Beneficiary for any one
or more of the following: (i) premiums for casualty and liability insurance
paid by Beneficiary whether or not Beneficiary or a receiver is in possession
and all renewals thereof; (ii) repair or restoration of damage or destruction in
excess of available insurance proceeds or condemnation awards; (iii) payments
deemed by Beneficiary to be required for the benefit of the Trust Property or
required to be made by the owner of the Trust Property under any
28
grant or declaration of easement, easement agreement, agreement with any
adjoining land owners or instruments creating covenants or restrictions for the
benefit of or affecting the Trust Property; (iv) shared or common expense
assessments payable to any association or corporation in which the owner of the
Trust Property is a member in any way affecting the Trust Property; and (v) any
costs incurred in connection with obtaining approvals and licenses from Gaming
Authorities including investigation costs.
All Protective Advances shall be additional Obligations secured by this Deed of
Trust, and shall become immediately due and payable upon demand and with
interest thereon from the date of the advance until paid at the Default Rate.
This Deed of Trust shall be a lien for all Protective Advances as to subsequent
purchasers and judgment creditors from the time this Deed of Trust is recorded.
All Protective Advances shall, except to the extent, if any, that any of the
same is clearly contrary to or inconsistent with the applicable provisions of
law, apply to and be included in: (a) any determination of the amount of
indebtedness secured by this Deed of Trust at any time; (b) the indebtedness
found due and owing to Beneficiary in the judgment of foreclosure and any
subsequent supplemental judgments, orders, adjudications or findings by the
court of any additional indebtedness becoming due after such entry of judgment,
it being agreed that in any foreclosure judgment, the court may reserve
jurisdiction for such purpose; and (c) application of income in the hands of any
receiver or mortgagee in possession.
4.12 Environmental Matters. The provisions of that certain Environmental
---------------------
Indemnity, dated as of the date hereof, by the Trustors in favor of the
Beneficiary are hereby incorporated by reference herein with the same force and
effect as if set forth herein.
ARTICLE V - GENERAL PROVISIONS
5.1 Extension; Release. The lien hereof shall remain in full force and
------------------
effect during any postponement or extension of the time of payment of the
Obligations, or of any part thereof, and any number of extensions or
modifications hereof, or any renewals, modifications, extensions, replacements,
or substitutions of the Notes or any additional notes taken by Beneficiary or
any Holder, shall not affect the lien hereof or the liability of either Trustor
or of any subsequent obligor to pay the Obligations, unless and until such lien
or liability shall have been expressly released in writing by Beneficiary by
proper instrument in accordance with the terms of the Indenture. Upon written
request from Beneficiary, Trustee shall fully reconvey, without warranty, this
Deed of Trust and the lien hereof by proper instrument in accordance with the
terms of the Indenture. The recitals in any such reconveyance of any matters of
facts shall be conclusive proof of the truthfulness thereof. The grantee in
such reconveyance may be described as "the person or persons legally entitled
thereto." Beneficiary shall have no obligation to record any release
instrument.
5.2 Trustors. This Deed of Trust and all provisions hereof, shall extend
--------
to and be binding upon Trustors and all persons claiming under or through
Trustors. Whenever in this Deed of Trust there is reference made to any of the
parties hereto, such reference shall be
29
deemed to include, wherever applicable, a reference to the heirs, executors and
administrators or successors and assigns (as the case may be) of Trustors,
Trustee and Beneficiary. Either Trustor's successors and assigns shall include,
without limitation, a receiver, trustee or debtor-in-possession of or for such
Trustor.
5.3 Additional Documents. Each Trustor agrees that upon request of
--------------------
Beneficiary it will from time to time execute, acknowledge and deliver all such
additional instruments and further assurances of title and will do or cause to
be done all such further acts and things as may be reasonably necessary to fully
protect, preserve, perfect and maintain the security of Beneficiary hereunder
and otherwise effectuate the intent of this Deed of Trust.
5.4 Statute of Limitations. To the fullest extent allowed by law, the
----------------------
right to plead, use or assert any statute of limitations as a plea or defense or
bar of any kind, or for any purpose, to any debt, demand or obligation secured
or to be secured hereby, or to any complaint or other pleading or proceeding
filed, instituted or maintained for the purpose of enforcing this Deed of Trust
or any rights hereunder, is hereby waived by Trustors.
5.5 Severability. The invalidity of any one or more covenants, phrases,
------------
clauses, sentences or paragraphs of this Deed of Trust shall not affect the
remaining portions of this Deed of Trust or any part thereof, and the same shall
be construed as if such invalid covenants, phrases, clauses, sentences or
paragraphs, if any, had not been inserted herein. If the lien of this Deed of
Trust is invalid or unenforceable as to any part of the Obligations secured
hereby, or if the lien is invalid or unenforceable as to any part of the Trust
Property, the unsecured or partially secured portion of such Obligations shall
be completely paid prior to the payment of the remaining and secured or
partially secured portion of such Obligations, and all payments made on such
Obligations, whether voluntary or under foreclosure, trustee's sale, or other
enforcement action or procedure, shall be considered to have been first paid on
and applied to the full payment of that portion of such indebtedness which is
not secured or fully secured by the lien of this Deed of Trust.
5.6 Interaction with Indenture.
--------------------------
(a) Incorporation by Reference. Any capitalized term used in this
--------------------------
Deed of Trust without definition, but defined in the Indenture, shall have the
same meaning here as in the Indenture.
(b) Conflicts. Notwithstanding any other provision of this Deed of
---------
Trust, the terms and provisions of this Deed of Trust shall be subject and
subordinate to the terms of the Indenture. To the extent that the Indenture
provides Trustors with a particular cure or notice period, or establishes any
limitations or conditions on Beneficiary's actions with regard to a particular
set of facts, Trustors shall be entitled to the same cure periods and notice
periods, and Beneficiary shall be subject to the same limitations and
conditions, under this Deed of Trust, as under the Indenture, in place of the
cure periods, notice periods, limitations and conditions provided for under this
Deed of Trust; provided, however, that such cure periods, notice periods,
-------- -------
limitations and conditions shall not be cumulative as between the Indenture and
this Deed of Trust. In the event of any conflict or inconsistency
30
between the provisions of this Deed of Trust 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.
5.7 Other Collateral. This Deed of Trust is one of a number of security
----------------
agreements to secure the debt delivered by or on behalf of Trustors pursuant to
the Indenture and the other Collateral Documents and securing the Obligations
secured hereunder. All potential junior Lien claimants are placed on notice
that, under any of the Collateral Documents or otherwise (such as by separate
future unrecorded agreement between Trustors and Beneficiary), other collateral
for the Obligations secured hereunder (i.e., collateral other than the Trust
Property) may, under certain circumstances, be released without a corresponding
reduction in the total principal amount secured by this Deed of Trust. Such a
release would decrease the amount of collateral securing the same indebtedness,
thereby increasing the burden on the remaining Trust Property created and
continued by this Deed of Trust. No such release shall impair the priority of
the lien of this Deed of Trust. By accepting its interest in the Trust
Property, each and every junior Lien claimant shall be deemed to have
acknowledged the possibility of, and consented to, any such release. Nothing in
this paragraph shall impose any obligation upon Beneficiary.
5.8 Notices. All notices and other communications under this Deed of
-------
Trust shall be in writing, except as otherwise provided in this Deed of Trust.
A notice, if in writing, shall be considered as properly given if given in
accordance with the provisions of Annex B attached hereto.
5.9 No Waiver of Remedies. By accepting payment of any amount secured
---------------------
hereby after its due date, or an amount which is less than the amount then due,
or performance of any obligation required hereunder after the date required for
such performance, Beneficiary does not waive its right to require prompt payment
or performance when due of all other amounts or obligations so secured or to
declare a default by reason of the failure to so pay or perform.
5.10 Trustee's Powers. At any time or from time to time without liability
----------------
therefor and without notice to Trustors, upon written request of Beneficiary and
presentation of the original or certified copies of this Deed of Trust, and
without affecting the personal liability of any person for payment of the
Obligations secured hereby or the effect of this Deed of Trust upon the
remainder of the Trust Property, Trustee may (a) release any part of the Trust
Property, (b) consent in writing to the making of any map or plat of all or any
part of the Property, (c) join in granting any easement on any part of the Trust
Property, or (d) join in any extension agreement or any agreement subordinating
the lien or charge of this Deed of Trust.
5.11 Beneficiary's Powers. Without affecting the liability of Trustors or
--------------------
any other person liable for the payment of any Obligation secured hereby, and
without affecting the lien or charge of this Deed of Trust upon any portion of
the Trust Property not then or theretofore released as security for the full
amount of all unpaid Obligations, Beneficiary may, from time to time and without
notice (a) release any person so liable, (b) extend the
31
maturity or alter any of the terms of any such obligation, or join in any
agreement modifying the terms of the Indenture or any Transaction Document, (c)
waive any provision hereof or grant other indulgences, (d) release or reconvey,
or cause to be released or reconveyed, at any time at Beneficiary's option, all
or any part of the Trust Property, (e) take or release any other or additional
security for any obligation herein mentioned, (f) make compositions or other
arrangements with debtors in relation thereto, or (g) subordinate the lien or
charge of this Deed of Trust.
5.12 Additional Security. If Beneficiary at any time holds additional
-------------------
security for any of the Obligations secured hereby, all such security shall be
taken, considered and held as cumulative, and Beneficiary may enforce the sale
thereof or otherwise realize upon the same, at its option, either before or
concurrently with the exercise of any of its rights or remedies hereunder or
after a sale is made hereunder. The taking of additional security, execution of
partial releases of the security, or any extension of the time of payment of the
indebtedness secured hereby shall not diminish the force, effect or impair the
liability of any maker, surety or endorser for the payment of any such
indebtedness.
5.13 Captions. The captions or headings at the beginning of each Section
--------
hereof are for the convenience of the parties and are not to be construed as a
part of this Deed of Trust.
5.14 Trust Irrevocable; No Offset. The Trust created hereby is irrevocable
----------------------------
by Trustors. No offset or claim that either Trustor now has or may in the future
have against Beneficiary or Trustee shall relieve either Trustor from paying the
amounts or performing the Obligations contained herein or secured hereby.
5.15 Corrections. Trustors shall, upon request of Trustee, promptly
-----------
correct any defect, error or omission which may be discovered in the contents of
this Deed of Trust or in the execution or acknowledgment hereof, and will
execute, acknowledge and deliver such further instruments and do such further
acts as may be necessary or as may be reasonably requested by Trustee to carry
out more effectively the purposes of this Deed of Trust, to subject to the lien
and security interest hereby created any of Trustors' properties, rights or
interest covered or intended to be covered hereby, and to perfect and maintain
such lien and security interest.
5.16 Attorneys' Fees. All references to "attorneys' fees" in this Deed of
---------------
Trust shall include, without limitation, such reasonable amounts as may then be
charged by Beneficiary for legal services furnished by attorneys in the employ
of Beneficiary (including reasonable charges for in-house counsel).
5.17 Amendments. This Deed of Trust cannot be waived, changed, discharged
----------
or terminated orally, but only by an instrument in writing signed by the party
against whom enforcement of any waiver, change, discharge or termination is
sought.
5.18 Acceptance by Trustee. Trustee accepts this Trust when this Deed of
---------------------
Trust, duly executed and acknowledged, is made a public record as provided by
law.
32
5.19 Authorization to Rely. Trustee, upon presentation to it of an
---------------------
affidavit signed by or on behalf of Beneficiary, setting forth any fact or facts
showing a default by Trustors, or either of them, under any of the terms or
conditions of this Deed of Trust, is authorized to accept as true and conclusive
all facts and statements in such affidavit and to act hereunder in complete
reliance thereon.
5.20 GOVERNING LAW. THIS DEED OF TRUST SHALL BE GOVERNED BY AND CONSTRUED
-------------
IN ACCORDANCE WITH THE LAWS OF THE STATE OF COLORADO.
5.21 Time of Essence. Time is of the essence of this Deed of Trust and of
---------------
every part hereof of which time is an element.
5.22 Future Advances. To the extent Beneficiary may make advances pursuant
---------------
hereto or to the terms of the Indenture, the parties hereto acknowledge and
intend that all such advances, if any, whenever hereafter made, shall be secured
by this Deed of Trust with the same priority as the initial amounts advanced and
secured by this Deed of Trust.
5.23 Actions by Beneficiary to Preserve. Should an Event of Default occur,
----------------------------------
Beneficiary, in its own discretion, without obligation so to do and without
further notice to or demand upon Trustors and without releasing Trustors from
any Obligation, may make or do the same in such manner and to such extent as it
may deem necessary to protect the security hereof. In connection therewith
(without limiting Beneficiary's general powers), Beneficiary shall have and is
hereby given the right, but not the obligation (a) to enter upon and take
possession of the Trust Property, (b) to make additions, alterations, repairs
and improvements to the Trust Property which it may consider necessary or proper
to keep the Trust Property in good condition and repair the same as needed, (c)
to appear and participate in any action or proceeding affecting or which may
affect the security hereof or the rights or powers of Beneficiary hereunder, (d)
to pay, purchase, contest or compromise any encumbrance, claim, charge, lien or
debt which in the judgment of either may affect or appear to affect the security
of this Deed of Trust or be or appear to affect the security of this Deed of
Trust or be or appear to be prior or superior hereto, and (e) in exercising such
powers, to pay necessary expenses and employ necessary or desirable consultants
including, without limitation, in connection with applying for gaming approvals
under applicable Gaming Laws and approvals for transfers of ownership for any
liquor license.
5.24 Reimbursement. Trustors shall pay immediately upon demand all sums
-------------
expended for expenses paid or incurred by Beneficiary, including, without
limitation, court costs, expenses for evidence of title, appraisals and surveys,
license fees, trustees' fees and reasonable attorneys' fees (including
reasonable charges for in-house counsel), under any of the terms of this Deed of
Trust, including, without limitation, the provisions of Section 5.22, together
------------
with interest on the amount of each expenditure from the date of such
expenditure at the Default Rate.
5.25 Usury Savings Clause. It is the intention of the parties to conform
--------------------
strictly to the usury laws, whether state or federal, that are applicable to the
transaction of which this
33
Deed of Trust is a part. All agreements between Trustors, or either of them,
and the Beneficiary, whether now existing or hereafter arising and whether oral
or written, are hereby expressly limited so that in no contingency or event
whatsoever shall the amount paid or agreed to be paid by Trustors for the use,
forbearance or detention of the money to be loaned or advanced under the
Indenture, the Notes, the Completion Capital Commitment, this Deed of Trust, any
other Collateral Document, or any other agreement or instrument relating
thereto, or for the payment or performance of any covenant or obligation
contained herein or therein, exceed the maximum amount permissible under
applicable federal or state usury laws. If under any circumstances whatsoever
fulfillment of any such provision, at the time performance of such provision
shall be due, shall involve exceeding the limit of validity prescribed by law,
then the obligation to be fulfilled shall be reduced to the limit of such
validity. If under any circumstances Trustors shall have paid an amount deemed
interest by applicable law, which would exceed the highest lawful rate, such
amount that would be excessive interest under applicable usury laws shall be
applied to the reduction of the principal amount owing in respect of the
Obligations and not to the payment of interest, or if such excessive interest
exceeds the unpaid balance of principal and any other amounts due hereunder, the
excess shall be refunded to the Trustors. All sums paid or agreed to be paid
for the use, forbearance or detention of the principal under any extension of
credit or advancement of funds by the Beneficiary or any Holder shall, to the
extent permitted by applicable law, and to the extent necessary to preclude
exceeding the limit of validity prescribed by law, be amortized, prorated,
allocated and spread from the date of the Indenture until payment in full of the
Obligations so that the actual rate of interest on account of such principal
amounts is uniform throughout the term hereof.
5.26 Jurisdiction and Venue. At the sole option of Beneficiary, any action
----------------------
concerning this Deed of Trust or any other Transaction Document may be brought
in the Colorado District Court for the County in which Beneficiary is located or
in the United States District Court for the District of Colorado, and each
Trustor consents to venue and personal jurisdiction with respect thereto.
5.27 Waiver of Jury Trial. Each Trustor hereby waives any right to jury
--------------------
trial of any claim, cross-claim or counter-claim relating to or arising out of
or in connection with this Deed of Trust and/or any of the other Transaction
Documents.
5.28 Waiver of Homestead and Other Exemptions. To the extent permitted by
----------------------------------------
law, each Trustor hereby waives all rights to any homestead or other exemption
to which such Trustor would otherwise be entitled under any present or future
constitutional, statutory, or other provision of applicable state or federal
law.
5.29 Construction Deed of Trust. This Deed of Trust secures indebtedness
--------------------------
for construction purposes as described in Section 4-9-313, Colorado Revised
Statutes (1973), as amended.
5.30 Gaming Laws. The grant of, and terms and provisions of, this Deed of
-----------
Trust, including, but not limited to, all rights and remedies of Beneficiary and
powers of attorney and appointment, are expressly subject to all laws, statutes,
regulations and orders affecting
34
limited gaming or the sale of liquor (collectively, the "Gaming Laws"), in the
State of Colorado, which may include, but not be limited to, the necessity for
the Beneficiary to obtain the prior approval of the regulatory agencies
enforcing the Gaming Laws before taking any action hereunder and to be licensed
by such regulatory agencies before exercising certain rights and remedies
hereunder.
[Remainder of page intentionally blank]
35
IN WITNESS WHEREOF, Trustors have duly executed and delivered this
Deed of Trust to Public Trustee, Security Agreement, Fixture Filing and
Assignment of Rents, Leases and Leasehold Interests (Xxxxxx County, Colorado)
as of the day and year first above written.
ISLE OF CAPRI BLACK HAWK L.L.C.,
a Colorado limited liability company
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Secretary
By: /s/ H. Xxxxxx Xxxx
-------------------------------
Name: H. Xxxxxx Xxxx
Title: Vice President
ISLE OF CAPRI BLACK HAWK CAPITAL CORPORATION,
a Colorado corporation
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Secretary
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
On August 19, before me, Xxxxxx X. Xxxxxxxxx, Notary Public, personally
appeared Xxxxx X. Xxxxxxx [_] personally known to me OR [X] proved to me on the
basis of satisfactory evidence to be the person whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
authorized capacity, and that by his signature on the instrument the person, or
the entity upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal.
[SEAL APPEARS HERE]
/s/ Xxxxxx X Xxxxxxxxx
------------------------------
Signature of Notary
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
On August 19, before me, Xxxxxx X. Xxxxxxxxx, Notary Public, personally
appeared Xxxxxx Xxxxxx Xxxx, [_] personally known to me OR [X] proved to me on
the basis of satisfactory evidence to be the person whose name is subscribed to
the within instrument and acknowledged to me that he executed the same in his
authorized capacity, and that by his signature on the instrument the person, or
the entity upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal.
[SEAL APPEARS HERE]
/s/ Xxxxxx X Xxxxxxxxx
------------------------------
Signature of Notary
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
On August 19, before me, Xxxxxx X. Xxxxxxxxx, Notary Public, personally
appeared Xxxxx X. Xxxxxxx [_] personally known to me OR [X] proved to me on the
basis of satisfactory evidence to be the person whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
authorized capacity, and that by his signature on the instrument the person, or
the entity upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal.
[SEAL APPEARS HERE]
/s/ Xxxxxx X Xxxxxxxxx
------------------------------
Signature of Notary
Exhibit A
---------
(Attached to and forming a part of the Deed of Trust to Public
Trustee, Security Agreement, Financing Statement and Assignment
of Rents and Leases, dated August 20, 1997 to the Public Trustee of
the County of Xxxxxx, Colorado, from
Isle of Capri Black Hawk L.L.C. and
Isle of Capri Black Hawk Capital Corp. for the benefit of
IBJ Xxxxxxxx Bank & Trust Company)
LEGAL DESCRIPTION
-----------------
A PARCEL OF LAND IN SECTION 7, TOWNSHIP 3 SOUTH, RANGE 72 WEST OF THE 6TH
PRINCIPAL MERIDIAN, CITY OF BLACK HAWK, COUNTY OF XXXXXX, STATE OF COLORADO,
MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A POINT ON THE SOUTHERLY
RIGHT-OF-WAY OF MAIN STREET AND THE NORTHWESTERLY XXXXXX XX XXX 0, XXXXX 00 XX
XXX XXXX OF BLACK HAWK, FROM WHENCE XXXXXXXXXXXXX XXXXXXX XX. 0 XXXXX X00
00'00"X A DISTANCE OF 6105.74 FEET AND FROM WHENCE XXXXXXXXXXXXX XXXXXXX XX. 0
XXXXX X00 00'00"X A DISTANCE OF 4250.25 FEET AND FROM WHENCE THE SOUTH QUARTER
CORNER OF SAID SECTION 7 BEARS S46 15'20"W A DISTANCE OF 1622.07 FEET; THENCE,
DEPARTING FROM SAID RIGHT-OF-WAY X00 00'00"X A DISTANCE OF 21.21 FEET ALONG
AMENDED RIGHT OF WAY; THENCE, CONTINUING ALONG SAID AMENDED RIGHT-OF-WAY S78
54'45"E A DISTANCE OF 713.45 FEET TO A POINT ON THE NORTHERLY LINE OF BLOCK 52,
SAID CITY OF BLACK HAWK AND ALSO THE SOUTHERLY RIGHT-OF-WAY OF MAIN STREET AS
PER ADG ENGINEERING SURVEY CURRENT IN OCTOBER 1995, X00 00'00"X A DISTANCE OF
41.60 FEET; THENCE, DEPARTING FROM SAID RIGHT-OF-WAY S06 22'00"E A DISTANCE OF
0.18 FEET; THENCE X00 00'00"X ALONG THE NORTHERLY LINE OF SAID BLOCK 52 A
DISTANCE OF 88.31 FEET; THENCE, CONTINUING ALONG SAID NORTHERLY LINE S82 55'00"E
A DISTANCE OF 291.38 FEET; THENCE, CONTINUING ALONG SAID NORTHERLY LINE S72
00'00"E A DISTANCE OF 264.50 FEET TO THE NORTHEASTERLY CORNER OF XXX 00, XXXX
XXXXX 00; XXXXXX X00 00'00"X A DISTANCE OF 100.00 FEET TO THE SOUTHEASTERLY
CORNER OF SAID LOT 18; THENCE X00 00'00"X A DISTANCE OF 254.94 FEET ALONG THE
SOUTHERLY LINE OF SAID BLOCK 52; THENCE X00 00'00"X A DISTANCE OF 270.03 FEET
CONTINUING ALONG SAID SOUTHERLY LINE; THENCE S83 38'00"W A DISTANCE OF 33.06
FEET TO THE INTERSECTION OF THE SOUTHERLY LINE OF LOT 4, SAID BLOCK 52 AND LINE
4-1 OF THE XXXXXXX LODE; THENCE, DEPARTING FROM SAID SOUTHERLY LINE AND XXXXX
XXXX 0-0 XX XXXX XXXXXXX XXXX X00 00'00"X A DISTANCE OF 143.20 FEET TO XXXXXX
XX. 0 XX XXX XXXXXXX XXXX X.X. XXXXXX XX. 000; THENCE S14 25'00"E A DISTANCE OF
150.10 FEET TO CORNER NO. 4 OF SAID RUNNING LODE; THENCE, XXXXX XXXX 0-0 XX XXXX
XXXXXXX XXXX X00 00'00"X A DISTANCE OF 228.64 FEET; THENCE X00 00'00"X A
DISTANCE OF
326.18 FEET TO SAID LINE 4-1 OF SAID XXXXXXX LODE; THENCE, ALONG SAID LINE 4-1
S73 45'00"W A DISTANCE OF 400.00 FEET TO CORNER NO. 1 OF SAID XXXXXXX LODE AND
TO INTERSECT WITH LINE 4-1 OF THE WABASH LODE, U.S. MINERALS SURVEY NO. 42;
THENCE X00 00'00"X ALONG LINE 4-1 OF SAID WABASH LODE A DISTANCE OF 328.65 FEET;
THENCE X00 00'00"X A DISTANCE OF 85.12 FEET; THENCE, X00 00'00"X A DISTANCE OF
130.71 FEET TO A POINT ON THE SOUTHERLY LINE OF SAID BLOCK 51; THENCE, S62
03'00"E ALONG SAID SOUTHERLY LINE A DISTANCE OF 69.21 FEET; THENCE, S78 52'00"E
A DISTANCE OF 41.23 FEET TO THE SOUTHWESTERLY CORNER OF XXX 0, XXXX XXXXX 00;
XXXXXX, X00 00'00"X A DISTANCE OF 99.99 FEET TO THE POINT OF BEGINNING,
CONTAINING 397,291.07 SQUARE FEET OR 9.1205 ACRES, MORE OR LESS.
ANNEX A
-------
(Attached to and forming a part of the Deed of Trust to Public
Trustee, Security Agreement, Financing Statement and Assignment
of Rents and Leases, dated August 20, 1997 to the Public Trustee of
the County of Xxxxxx, Colorado, from
Isle of Capri Black Hawk L.L.C. and Isle of Capri Black Hawk Capital Corp.
for the benefit of IBJ Xxxxxxxx Bank & Trust Company)
DEFINED TERMS
-------------
As used in this Deed of Trust, the following terms have the meanings set
forth below. Any capitalized term used in this Deed of Trust which is not
defined herein shall have the meaning ascribed to such term in the Deed of
Trust.
"Affilate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control.
"Asset Sale" means (i) the sale, lease, conveyance or other disposition of
any assets (including, without limitation, by way of a sale and leaseback)
(provided that the sale, lease, conveyance or other disposition of all or
substantially all of the assets of the Company and its Subsidiaries, taken as a
whole, shall be governed by Section 4.15 and 5.1 of the Indenture and not by
Section 4.10 of the Indenture) and (ii) the issue or sale by the Company or any
of its Subsidiaries of Equity Interests of any of the Company's Subsidiaries, in
the case of either clause (i) or (ii), whether in a single transaction or a
series of related transactions (a) that have a fair market value in excess of
$250,000 or (b) for net proceeds in excess of $250,000. Notwithstanding the
foregoing: (i) a transfer of assets by the Company to a Wholly Owned Subsidiary
or by a Wholly Owned Subsidiary to the Company or to another Wholly Owned
Subsidiary, (ii) an issuance of Equity Interests by a Wholly Owned Subsidiary to
the Company or to another Wholly Owned Subsidiary, (iii) a Restricted Payment
that is permitted by Section 4.7 of the Indenture and (iv) a transfer of all
Public Improvements (as defined in the Subdivision Agreement) and all installed
physical facilities (as described in the Subdivision Agreement) required to be
transferred by the Company to the city of Black Hawk, Colorado pursuant to the
terms of the Subdivision Agreement shall not be deemed to be Asset Sales.
"Attributable Debt" in respect of a sale and leaseback transaction means,
at the time of determination, the present value (discounted at the rate of
interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments
i
during the remaining term of the lease included in such sale and leaseback
transaction (including any period for which such lease has been extended or
may, at the option of the lessor, be extended).
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Business Day" means any day other than a Legal Holiday.
"Capital" means Isle of Capri Black Hawk Capital Corp., a Colorado
corporation and a wholly owned subsidiary of the Company.
"Capital Lease Obligation" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized on a balance sheet in accordance with
GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Collateral and Disbursement Agreement" means the Cash Collateral and
Disbursement Agreement among the Issuers, the Trustee, the Independent
Construction Consultant and the Disbursement Agent, in connection with the Isle-
Black Hawk.
"Cash Equivalents" means (i) United States dollars, (ii) securities issued
or directly and fully guaranteed or insured by the United States government or
any agency or instrumentality thereof having maturities of not more than six
months from the date of acquisition, (iii) certificates of deposit and
eurodollar time deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case with any domestic commercial bank having
capital and surplus in excess of $500 million and a Xxxxx Bank Watch Rating of
"B" or better, (iv) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (ii) and (iii)
above entered into with any financial institution meeting the qualifications
specified in clause (iii) above, (v) commercial paper having the highest rating
obtainable from Xxxxx'x Investors Service, Inc. or Standard & Poor's Corporation
and in each case maturing within six months after the date of acquisition and
(vi) investment funds investing solely in securities of the types described in
(ii), (iii), (iv) or (v) above if such fund has net assets of at least $500
million.
"Casino America" means Casino America, Inc., a Delaware corporation.
ii
"Change of Control" means the occurence of any of the following: (i) the
sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Subsidiaries, taken as
a whole, to any "person" (as such term is used in Section 13(d)(3) of the
Exchange Act) other than Casino America or any of its Affiliates (ii) the
expiration or termination of the Management Agreement or the replacement of
Casino America or any of its Affiliates as manager under the Management
Agreement with any Person other than a successor to Casino America, (iii) the
adoption of a plan relating to the liquidation or dissolution of the Company
or Casino America, (iv) the liquidation or dissolution of the Company or
Casino America or any successor thereto, (v) prior to the consummation of an
Initial Public Offering, the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that Casino
America and Nevada Gold, or a successor to Casino America or Nevada Gold, cease
to collectively control a majority of the voting power of the Company, (vi)
after an Initial Public Offering, the Company's becoming aware of (by way of a
report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy
vote, written notice or otherwise) the acquisition by any Person or related
group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act, or any successor provision to either of the foregoing, including
any "group" acting for the purpose of acquiring, holding or disposing of
securities within the meaning of Rule 13d-5(b)(l) under the Exchange Act), other
than Casino America and Nevada Gold, or a successor to Casino America or Nevada
Gold, in a single transaction or in a related series of transactions, by way of
merger, consolidation or other business combination or purchase of beneficial
ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any
successor provision) of 50% or more of the total voting power entitled to vote
in the election of the Managers or Board of Directors of such other Person
surviving the transaction and, at such time, Casino America and Nevada Gold, or
a successor to Casino America or Nevada Gold, shall fail to beneficially own,
directly or indirectly, securities representing greater than the combined voting
power of the Company's or such other Person's Capital Stock as is beneficially
owned by such Person or group; (vii) the first day on which the Company fails to
own 100% of the issued and outstanding Equity Interests of Capital; and (vii)
during any period of two consecutive years, individuals who at the beginning of
such period constituted the Managers (together with any new mangers or board
members, as the case may be, whose election or appointment by such committee or
whose nomination for election by the members or shareholders of the Company, as
the case may be, was approved by a vote of a majority of the managers or board
members, as the case may be, then still in office who were either managers or
board members at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constituted a
majority of the Managers then in office; provided, however, that a Change of
Control shall not occur solely by reason of a Permitted C-Corp. Conversion.
"Closing Date" means the closing date for the sale and original issurance
of the Notes.
"Collateral Documents" means, collectively, this Deed of Trust, the
Security Agreement by the Issuers in favor of the Trustee, the Assignments of
Patent, Trademark and Copyright, the Collateral Assignments by the Issuers in
favor of the Trustee, the Cash Collateral and
iii
Disbursement Agreement, the Issuer Pledge Agreement by the Company in favor of
the Trustee, the Pledge and Assignment by the Issuers in favor of the Trustee,
the Manager Subordination Agreement, Uniform Commercial Code financing
statements and fixture filings, and any other agreements, instruments,
documents, pledges or filings that evidence, set forth or limit the Lien of the
Trustee in the Note Collateral.
"Company" means Isle of Capri Black Hawk L.L.C., a Colorado limited
liability company.
"Completion Capital Commitment" means the Completion Capital Commitment
dated as of the date of the Indenture executed by Casino America in favor of
the Trustee for the benefit of the Holders.
"Consolidated Cash Flow" means, with respect to any Person for any period,
the Consolidated Net Income of such Person for such period plus (i) an amount
equal to any extraordinary loss plus any net loss realized in connection with
an Asset Sale (to the extent such losses were deducted in computing such
Consolidated Net Income), plus (ii) provision for taxes based on income or
profits of such Person and its Subsidiaries for such period, to the extent that
such provision for taxes was included in computing such Consolidated Net Income,
plus (iii) Consolidated Interest Expense of such Person and its Sudsidiaries for
such period, to the extent that any such expense was deducted in computing such
Consolidated Net Income, plus (iv) depreciation and amortization (including
amortization of goodwill and other intangibles but excluding amortization of
prepaid cash expenses that were paid in a prior period) of such Person and its
Subsidiaries for such period to the extent that such depreciation and
amortization were deducted in computing such Consolidated Net Income, in each
case, on a consolidated basis and determined in accordance with GAAP.
Notwithstanding the foregoing, the provision for taxes on the income or profits
of, and the depreciation and amortization of, a Subsidiary of the referent
Person shall be added to Consolidated Net Income to compute Consolidated Cash
Flow only to the extent (and in the same proportion) that the Net Income of such
Subsidiary was included in calculating the Consolidated Net Income of such
Person and only if a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Subsidiary without prior
governmental approval (that has not been obtained), and without direct or
indirect restriction pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to that Subsidiary or its stockholders.
"Consolidated Interest Expense" means, with respect to any person for any
period, without duplication, (i) the consolidated interest expense of such
Person and its Subsidiaries for such period, whether paid or accured (including,
without limitation, amortization or original issue discount, non-cash interest
payments, the interest component of any deferred payment obligations, the
interest component of all payments associated with Capital Lease Obligations,
imputed interest with respect to Attributable Debt, commissions, discounts and
other fees and charges incurred in respect of letter of credit or bankers'
acceptance financings, and net payments (if any) pursuant to Hedging
Obligations), (ii) the consolidated interest expense of such Person and its
Subsidiaries that was capitalized during such period, (iii) any interest expense
on
iv
Indebtedness of another Person that is Guaranteed by such Person or one of its
Subsidiaries or secured by a Lien on assets of such Person or one of its
Subsidiaries (whether or not such Guarantee or Lien is called upon) and (iv) to
the extent not included above, Contingent Interest, whether paid or accrued, to
the extent such expense was deducted in computing Consolidated Net Income.
"Consolidated Net Income" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Subsidiaries for such
period, on a consolidated basis, determined in accordance with GAAP, provided
that (i) the Net Income (but not loss) of any Person that is not a Subsidiary or
that is accounted for by the equity method of accounting shall be included only
to the extent of the amount of dividends or distributions paid in cash to the
referent Person or a Wholly Owned Subsidiary thereof, (ii) the Net Income of any
Subsidiary shall be excluded to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary of such Net Income is not
at the date of determination permitted without any prior such governmental
approval (that has not been obtained) or, directly or indirectly, by operation
of the terms of its charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to such Subsidiary or
its stockholders, (iii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition shall
be excluded and (iv) the cumulative effect of a change in accounting principles
shall be excluded.
"Consolidated Net Worth" means, with respect to any Person as of any date,
the sum of (i) the consolidated equity of the common stockholders of such Person
and its consolidated Subsidiaries as of such date plus (ii) the respective
amounts reported on such Person's balance sheet as of such date with respect to
any series of preferred stock (other than Disqualified Stock) that by its terms
is not entitled to the payment of dividends unless such dividends may be
declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such preferred stock, less (x) all write-ups (other than
write-ups resulting from foreign currency translations and write-ups of tangible
assets of a going concern business made within 12 months after the acquisition
of such business) subsequent to the date of the Indenture in the book value of
any asset owned by such Person or a consolidated Subsidiary of such Person, (y)
all investments as of such date in unconsolidated Subsidiaries and in Person
that are not Subsidiaries (except, in each case, Permitted Investments) and (z)
all unamortized debt discount and expense and unamortized deferred charges as of
such date, all of the foregoing determined in accordance with GAAP.
"Construction Disbursement Account" means the account, to be maintained by
the Disbursement Agent and pledged to the Trustee, pursuant to the terms of the
Cash Collateral and Disbursement Agreement, into which approximately $52.5
million of the net proceeds of the Offering shall be deposited.
"Construction Disbursement Budget" means itemized scheduled setting forth
on a line item basis all of the costs (including financing costs) estimated to
be incurred in connection with the financing, design, development, construction
and equipping of the Isle-Black Hawk, as such
v
schedules are delivered to the Disburesment Agent on the Closing Date and as
amended from time to time in accordance with the terms of the Cash Collateral
and Disbursement Agreement.
"Contingent Interest" means with respect to any principal amount of the
Notes as of any date after the Isle-Black Hawk becomes Operating, an amount
equal to the product of (i) 5% of the Company's Consolidated Cash Flow for the
Semiannual Period last completed times (ii) a fraction, the numerator of which
is the amount of such principal and the denominator of which is $75.0 million.
"Default" means any event that is or with the passage of time or the giving
of notice or both would be an Event of Default.
"Design-Build Agreement" means the Design-Build Agreement dated July 22,
1997 between the Company and Xxxxxxxx Construction, Inc.
"Disbursement Agent" means IBJ Xxxxxxxx Bank & Trust Company, as
disbursement agent.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the opinion of the holder thereof, in whole or in part, on or prior to the date
that is 91 days after the date on which the Notes mature.
"Environmental Indemnity" means the Environmental Indemnity, dated as of
August 20, 1997, by the Trustors in favour of the Beneficiary.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Event of Default" occurs if:
(a) the Issuers default for 30 days in the payment when due of interest
on, or Liquidated Damages, if any, with respect to, the Notes;
(b) the Issuers default in the payment when due of the principal of or
premium, if any, on the Notes;
(c) the Issuers fail to comply with the provisions described under
Sections 3.9, 4.7, 4.9, 4.10, 4.15, 4.22, 4.28, 4.30, 4.31 or 5.1 of the
Indenture;
(d) the Issuers fail for 30 days after notice to comply with any of its
other agreements in the Indenture or the Notes;
vi
(e) a default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Subsidiaries (or
the payment of which is guaranteed by the Company or any of its Subsidiaries)
whether such Indebtedness or guarantee now exists, or is created after the date
of the Indenture, which default (a) is caused by a failure to pay principal of
or premium, if any, or interest on such Indebtedness prior to the expiration of
the grace period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $5.0 million or more;
(f) the Issuers or any of their Subsidiaries fail to pay final judgments
aggregating in excess of $5.0 million, which judgments are not paid, discharged
or stayed for a period of 60 days;
(g) the Issuers breach any material representation or warranty set forth
in the Collateral Documents, or default by the Issuers in the performance of any
covenant set forth in the Collateral Documents, or repudiation by the Issuers
of their obligations under the Collateral Documents or the unenforceability of
the Collateral Documents against the Issuers for any reason;
(h) either Issuer, any Subsidiary of either Issuer, or any group of
Subsidiaries of either Issuer that, taken as a whole, would constitute a
Significant Subsidiary of either Issuer certain events of bankruptcy or
insolvency with respect to the Issuer or any of their Subsidiaries;
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors, or
(v) generally is not paying its debts as they become due;
(i) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against either Issuer, any Subsidiary of either
Issuer, or any group of Subsidiaries of either Issuer that,
taken as a whole, would constitute a Significant Subsidiary of
either Issuer in an involuntary case;
(ii) appoints a custodian of either Issuer or any Significant
Subsidiary of either Issuer or any group of Subsidiaries of
either Issuer that, taken as a whole,
vii
would constitute a Significant Subsidiary or for all or
substantially all of the property of either Issuer or any
Significant Subsidiary of either Issuer or any group of
Subsidiaries of either Issuer that, taken as a whole, would
constitute a Significant Subsidiary of either Issuer; or
(iii) orders the liquidation of either Issuer or any Significant
Subsidiary of either Issuer or any group of Subsidiaries of
either Issuer that, taken as a whole, would constitute a
Significant Subsidiary of either Issuer;
and the order or decree remains unstayed and in effect for 60 consecutive
days;
(j) the revocation, termination, suspension or other cessation of
effectiveness of any Gaming License which results in the cessation or suspension
of gaming operations for a period of more than 90 consecutive days at any Gaming
Facility;
(k) a default by Casino America in the performance of its obligations set
forth in the Completion Capital Commitment or repudiation of its obligations
under the Completion Capital Commitment;
(l) the failure of the Isle-Black Hawk to be Operating by the Operating
Deadline or to remain Operating thereafter, expect (i) as the hours of operation
of the Isle-Black Hawk may be limited by any Gaming Authority or Gaming Law or
(ii) for a period of time not to exceed 20 days during any 30-day period and not
to exceed 45 days during any one-year period; provided, however, that, in any
event, there shall not be an Event of Default under this clause (l) (ii) if the
failure to remain Operating during such period results from an Event of Loss
which event shall be covered by Section 4.30 of the Indenture; or
(m) any failure by the Issuers to repurchase Notes tendered pursuant to a
Change of Control Offer (as defined below). Upon the occurrence of a Change of
Control, each Holder shall have the right to require the Issuers to repurchase
all or any part (equal to $1,000 or an integral multiple thereof) of such
Holder's Notes pursuant to the offer described below (the "Change of Control
Offer") at an offer price in cash equal to 101% of the aggregate principal
amount thereof plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date of repurchase (the "Change of Control Payment"). Within ten
days following any Change of Control, the Issuers shall mail a notice to each
Holder describing the transaction or transactions that constitute the Change of
Control and offering to repurchase Notes on the date specified in such notice,
which date shall be no earlier than 30 days and no later than 60 days from the
date such notice is mailed (the "Change of Control Payment Date"), pursuant
to the procedures required by the Indenture and described in such notice. The
Issuers shall comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent such laws
and regulations are applicable in connection with the repurchase of the Notes as
a result of a Change of Control.
On the Change of Control Payment Date, the Issuers shall, to the extent
lawful, (i) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control
viii
Offer, (ii) deposit with the Paying Agent an amount to the Change of Control
Payment in respect of all Notes or portions thereof so tendered and (iii)
deliver or cause to be delivered to the Trustee the Notes so accepted together
with an Officers' Certificate stating the aggregate principal amount of Notes or
portions thereof being purchased by the Issuers. The Paying Agent shall promptly
mail to each Holder of Notes so tendered the Change of Control Payment for such
Notes, and the Trustee shall promptly authenticate and mail (or cause to be
transferred by book entry) to each Holder a new Note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided that each
such new Note shall be in a principal amount of $1,000 or an integral multiple
thereof. The Issuers shall publicy announce the results of the Change of Control
Offer on or as soon as practicable after the Change of Control Payment Date.
The Change of Control provisions described above shall be applicable
whether or not any other provisions of the Indenture are applicable. Except as
described above with respect to a Change of Control, the Indenture does not
contain provisions that permit the Holders to require that the Issuers
repurchase or redeem the Notes in the event of a takeover, recapitalization or
similar transaction.
The source of funds for any repurchase of Notes upon a Change of Control
shall be the Issuers' cash or cash generated from operations or other sources,
including borrowings (if available and permitted pursuant to the terms of the
Indenture) or sales of assets; however, there can be no assurance that
sufficient funds shall be available at the time of any Change of Control to make
any required purchases of Notes.
Notwithstanding the foregoing, the Issuers shall not be required to make a
Change of Control Offer upon a Change of Control if a third party makes the
Change of Control Offer in the manner, at the times and otherwise in compliance
with the requirements set forth in the Indenture applicable to a Change of
Control Offer made by the Issuers and purchases all Notes validly tendered and
not withdrawn under such Change of Control Offer.
The definition of Change of Control includes a phrase relating to the sale,
lease, transfer, conveyance or other disposition of "all or substantially all"
of the assets of the Issuers and their Subsidiaries, taken as a whole. Although
there is a developing body of case law interpreting the phrase "substantially
all," there is no precise established definition of the phrase under applicable
law. Accordingly, the ability of a Holder to require the Issuers to repurchase
Notes as a result of a sale, lease transfer, conveyance or other disposition of
less than all of the assets of the Issuers and their Subsidiaries, takes as a
whole, to another Person or group may be uncertain.
"Event of Loss" means, with respect to any property or asset (tangible or
intangible, real or personal), any of the following: (i) any loss, destruction
or damage of such property or asset; (ii) any institution of any proceedings for
the condemnation or seizure of such property or asset or for the exercise of any
right of eminent domain, (iii) any actual condemnation, seizure or taking by
exercise of the power of eminent domain or otherwise of such property or asset,
or confiscation of such property or asset or the requisition of the use of such
property or asset; or (iv) any settlement in lieu of clauses(ii) or (iii) above.
ix
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"FF&E" means furniture, fixtures or equipment used in the ordinary course
of the business of the Company and its Subsidiaries.
"FF&E Financing" means the incurrence of Indebtedness, the proceeds of
which are utilized solely to finance or refinance the acquisition of (or entry
into a capital lease by the Company or a Subsidiary with respect to) FF&E.
"Final Plans" with respect to any particular work or improvement means
Plans which (i) have received final approval from all governmental authorities
required to approve such Plans prior to completion of the work or improvements
and (ii) contain sufficient specificity to permit the completion of the work or
improvement.
"Fixed Charge Coverage Ratio" means with respect to any Person for any
period, the ratio of the Consolidated Cash Flow of such Person and its
Subsidiaries for such period to the Fixed Charges of such Person and its
Subsidiaries for such period. In the event that the Issuers or any of their
Subsidiaries incur, assume, guarantee or redeem any Indebtedness (other than
revolving credit borrowings) or issue preferred stock subsequent to the
commencement of the period for which the Fixed Charge Coverage Ratio is being
calculated but prior to the date on which the event for which the calculation of
Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed
Charge Coverage Ratio shall be calculated giving pro forma effect to such
incurrence, assumption, guarantee or redemption of Indebtedness, or such
issuance or redemption of preferred stock, as of the same had occurred at the
beginning of the applicable four-quarter reference period. In addition, for
purposes of making the computation referred to above, (i) acquisitions that have
been made by the Issuers or any of their Subsidiaries, including through mergers
or consolidations and including any related financing transactions, during the
four-quarter reference period or subsequent to such reference period and on or
prior to the Calculation Date shall be deemed to have occurred on the first day
of the four-quarter reference period and Consolidated Cash Flow for such
reference period shall be calculated without giving effect to clause (iii) of
the proviso set forth in the definition of Consolidated Net Income, and (ii) the
Consolidated Cash Flow attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded and (iii) the Fixed Charges attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be excluded, but
only to the extent that the obligations giving rise to such Fixed Charges shall
not be obligations of the referent Person or any of its Subsidiaries following
the Calculation Date.
"Fixed Charges" means, with respect to any Person for any period, without
duplication, the sum of (i) Fixed Interest, (ii) any interest expense on
Indebtedness of another Person that is Guaranteed by such Person or one of its
Subsidiaries or secured by a Lien on assets of such Person or one of its
Subsidiaries (whether or not such Guarantee or Lien is called upon) and (iii)
the product of (a) all dividend payments, whether or not in cash, on any series
of preferred stock of such Person or any or its Subsidiaries, other than
dividend payments on Equity Interests
x
payable solely in Equity Interests of the Issuers, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current combined federal, state and local statutory tax rate of such Person,
expressed as a decimal, in each case, on a consolidated basis and in accordance
with GAAP.
"Fixed Interest" means interest on the principal amount of the Notes at 13%
per annum from August 20, 1997 until maturity.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Gaming Authority" means any agency, authority, board, bureau, commission,
department, office or instrumentality of any nature whatsoever of the United
States federal or foreign government, any state, province or any city or other
political subdivision or otherwise, and whether now or hereafter in existence,
or any officer or official thereof, including the Colorado Limited Gaming
Control Commission and any other applicable gaming regulatory authority with
authority to regulate any gaming operation (or proposed gaming operation) owned,
managed or operated by the Company, Casino America or Nevada Gold or any of
their respective Subsidiaries.
"Gaming Business" means the gaming business and includes all
businesses either licensed or unlicensed by a Gaming Authority necessary for,
incident to or connected with or arising out of the operation of a gaming
establishment or facility (including developing and operating lodging, retail
and restaurant facilities, sports or entertainment facilities, transportation
services or other related activities or enterprises and any additions or
improvements thereto) and any businesses incident and useful to the gaming
business, including, without limitation, food and beverage distribution
operations to the extent that they are operated in connection with a gaming
business.
"Gaming Facility" means any tangible building or other structure used or
expected to be used to enclose space in which a Gaming Business is conducted and
(i) wholly or partially owned; directly or indirectly, by the Company or any
Subsidiary or (ii) any portion or aspect of which is managed or used, or
expected to be managed or used, by the Company or Subsidiary; provided that the
term Gaming Facility does not include any real property whether or not such
building or other structure is located thereon or adjacent thereto or any
furniture, fixtures and equipment, including gaming equipment, used in
connection with any Gaming Business.
"Gaming Law" means the gaming laws of any jurisdiction or jurisdictions to
which the Company or any of its Subsidiaries is, or may at any time after the
date of the Indenture, be subject.
xi
"Gaming License" means any license, permit, franchise or other
authorization from any Gaming Authority required on the date of the Indenture or
at any time thereafter to own, lease, operate or otherwise conduct the Gaming
Business of the Company, including all licenses granted under the gaming laws of
any jurisdiction to which the Company is, or may at any time after the date of
the Indenture, be subject.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Hedging Obligations" means, with respect to any Person, the obligations of
such Person under (i) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements and (ii) other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates.
"Holders" means the record holders from time to time of the Notes.
"Hotel Option" means the Company's option, subject to the terms and
conditions set forth in the Design-Build Agreement, to build a hotel in
connection with the development of the Isle-Black Hawk.
"Indebtedness" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of borrowed money (including
accrued and unpaid Contingent Interest) or evidenced by bonds, notes, debentures
or similar instruments or letters of credit (or reimbursements agreements in
respect thereof) or banker's acceptances or representing Capital Lease
Obligations or the balance deferred and unpaid of the purchase price of any
property or representing any Hedging Obligations, except any such balance that
constitutes an accrued expense or trade payable, if and to the extent any of the
foregoing indebtedness (other than letters of credit, performance or other
surety bonds and Hedging Obligations) would appear as a liability upon a balance
sheet of such Person prepared in accordance with GAAP, as well as all
indebtedness secured by a Lien on any asset of such Person (whether or not such
indebtedness is assumed by such Person) and, to the extent not otherwise
included, the Guarantee by such Person of any indebtedness of any other Person.
"Indenture" means the Indenture dated as of August 20, 1997, among the
Company, Capital and the Trustee, as trustee.
"Independent Construction Consultant" means the independent construction
consultant to be retained in connection with the construction of the Isle-Black
Hawk, or any successor independent construction consultant appointed by the
Trustee pursuant to the terms of the Cash Collateral and Disbursement Agreement.
"Investments" means, with respect to any Person, all investments by such
Person in other Persons in the forms of direct or indirect loans (including
guarantees of Indebtedness or other
xii
obligations), advances (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), capital
contributions, purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, together with all items that
are or would be classified as investments on a balance sheet prepared in
accordance with GAAP; provided that an acquisition of assets, Equity Interests
or other securities by the Company for consideration consisting of common equity
securities of the Company shall not be deemed to be an Investment. If the
Company or any Subsidiary of the Company sells or otherwise disposes of any
Equity Interests of any direct or indirect Subsidiary of the Company such that,
after giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Equity Interests of such Subsidiary not sold or disposed of.
"Isle-Black Hawk" means the pending project to develop, construct, equip
and operate the Isle of Capri Casino and related amenities, as described in the
Offering Circular of the Issuers dated August 14, 1997, relating to the Series A
Notes.
"Issuers" means the Company and Capital.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commerical Code (or equivalent statutes) of any jurisdiction).
"Liquidated Damages" means all liquidated damages then owing pursuant to
Section 5 of the Registration Rights Agreement.
"Management Agreement" means the Amended and Restated Management Agreement
dated as of July 29, 1997, between the Company and Casino America relating to
the management of the Isle-Black Hawk.
"Management Subordination Agreement" means the Manager Subordination
Agreement dated as of the date of the Indenture among the Company, Casino
America and the Trustee.
"Minimum Facilities" means, with respect to the Isle-Black Hawk, a casino
which has in operation at least 1,025 slot machines and ten table games, related
amenities (including a restaurant, buffet restaurant, a bar and an event area)
and has parking for at least 900 vehicles,
xiii
including parking for up to 150 vehicles which may be temporarily unavailable in
the event that the Company exercises the Hotel Option.
"Net Income" means, with respect to any Person, the net income (loss) of
such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (i) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (a) any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions) or (b) the
disposition of any securities by such Person or any of its Subsidiaries or the
extinguishment of any Indebtedness of such Person or any of its Subsidiaries,
(ii) any extraordinary or nonrecurring gain (but not loss), together with any
related provision for taxes on such extraordinary or nonrecurring gain (but not
loss), (iii) in the case of any Person that is treated as a pass-through entity
for United States federal income tax purposes, the provision for taxes based on
income or profits of such Person and its Subsidiaries for such period that would
be applicable if such Person were taxable as a subchapter "C" corporation and
(iv) solely for the purpose of calculating the Fixed Charge Coverage Ratio to
determine compliance by the Issuers with Sections 4.7, 4.9 and 4.27 of the
Indenture, pre-opening expenses as determined in accordance with GAAP incurred
by such Person in connection with the opening of the Isle-Black Hawk up to a
maximum of $2.5 million.
"Nevada Gold" means Nevada Gold, Inc., a Nevada corporation.
"Note Collateral" means all assets, now owned or hereafter acquired, of the
Issuers or any of their respective Subsidiaries, that are pledged or assigned,
or required to be pledged or assigned under the Indenture or the Collateral
Documents, to the Trustee pursuant to the Collateral Documents, which shall
initially include all real estate, improvements and all personal property owned
by the Issuers and all accounts held by or for the benefit of the Issuers,
together with all proceeds thereof (including, without limitation, the proceeds
of Assets Sales), in each case excluding FF&E acquired with FF&E Financing,
gaming and liquor licenses, and certain other exceptions.
"Notes" means the 13% Series A Notes due 2004 With Contingent Interest,
together with the 13% Series B Notes due 2004 With Contingent Interest.
"Offering" means the Offering of the Notes by the Issuers.
"Offering Circular" means that certain offering circular, dated August 14,
1997, relating to the offering of Notes, and all supplements, schedules or other
attachment thereto.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasure, the Controller, the
Secretary or any Vice-President of such Person.
xiv
"Officers' Certificate" means a certificate signed on behalf of the Company
or Capital, as the case may be, by two Officers of the Company or Capital, as
the case may be, one of whom must be the principal executive officer, the
principal financial officer, the treasurer or the principal accounting officer
of the Company or Capital, as the case may be, that meets the requirements of
Section 12.5 of the Indenture.
"Operating" means, with respect to the Isle-Black Hawk, the first time that
(i) all Gaming Licenses have been granted and have not been revoked or
suspended, (ii) all Liens (other than Liens created by the Collateral Documents
or Permitted Liens) related to the development, construction and equipping of,
and beginning operations at, the Isle-Black Hawk have been discharged or, if
payment is not yet due or if such payment is contested in good faith by the
Issuers, sufficient funds remain in the Construction Disbursement Account to
discharge such Liens and the Issuers have taken any action (including the
institution of legal proceedings) necessary to prevent the sale of any or all of
the Isle-Black Hawk or the real property on which the Isle-Black Hawk shall be
constructed, (iii) the Independent Construction Consultant, the general
contractor and the architect of the Isle-Black Hawk shall have delivered a
certificate to the Trustee certifying that the Isle-Black Hawk is substantially
complete in all material respects in accordance with the Final Plans with
respect to the Minimum Facilities and all applicable building and other laws,
ordinances and regulations, (iv) the Isle-Black Hawk is in a condition
(including installation of furnishings, fixtures and equipment) to receive
customers in the ordinary course of business, (v) the Minimum Facilities are
open to the general public and operating in accordance with all applicable laws
and (vi) a temporary certificate of occupancy has been issued for the Isle-Black
Hawk by the appropriate governmental authorities.
"Operating Deadline" means June 15, 1999.
"Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee, that meets the requirements of Section 12.5 of the
Indenture. The counsel may be an employee of or counsel to either the Issuers or
the Trustee.
"Paying Agent" means an office or agency where Notes may be presented for
payment.
"Permitted C-Corp. Conversion" shall mean a transaction resulting in the
Company becoming a subchapter "C" corporation pursuant to the United States
Internal Revenue Code; provided, that in connection with such transaction, (i)
the subchapter "C" corporation resulting from such transaction is a corporation
organized and existing under the laws of any state of the United States or the
District of Columbia and the beneficial holders of the Equity Interests of the
subchapter "C" corporation resulting from such transaction shall be the same,
and shall be in the same percentages, as the beneficial holders of the Equity
Interests of the Company immediately prior to such transaction; (ii) the
subchapter "C" corporation resulting from such transaction assumes all the
obligations of the Company under the Notes, the Collateral Documents and the
Indenture pursuant to a supplemental indenture in a form reasonably satisfactory
to the Trustee; (iii) the Trustee is provided 45 days' advance notice of such
transaction and evidence reasonably satisfactory to the Trustee (which shall
include but not to be limited to title insurance and/or an opinion of counsel)
regarding the maintenance of the perfection, priority and proof of the security
xv
interest of the Trustee in the Note Collateral; (iv) after giving effect to such
transaction no Default or Event of Default exists; (v) such transaction would
not result in the loss or suspension or material impairment of any Gaming
License unless a comparable replacement Gaming License is effective prior to or
simultaneously with such loss, suspension or material impairment; (vi) the
subchapter "C" corporation resulting from such transaction will have
Consolidated Net Worth immediately after the transaction equal to or greater
than the Consolidated Net Worth of the Company immediately preceding the
transaction and after giving pro forma effect as if the transaction had occurred
at the beginning of the applicable four-quarter period, the Fixed Charge
Coverage Ratio after the transaction of the subchapter "C" corporation resulting
from such transaction shall be equal to or greater than the Fixed Charge
Coverage Ratio of the Company immediately preceding the transaction; (vii) such
transaction would not require any Holder or beneficial owner of Notes to obtain
a Gaming License or be qualified or found suitable under the law of any
applicable gaming jurisdiction; provided that such Holder or beneficial owner
would not have been required to obtain a Gaming License or be qualified or
found suitable under the laws of any applicable gaming jurisdiction in the
absence of such transaction; (viii) the Company shall have delivered to the
Trustee an opinion of counsel in the United States reasonably acceptable to the
Trustee to the effect that the Holders will not recognize income gain or loss
for federal income tax purposes as a result of such Permitted C-Corp.
Conversion; and (ix) the Issuers shall have delivered to the Trustee an
Officers' Certificate as to compliance with all of the above conditions.
"Permitted Dispositions" means the sale, transfer, lease or other
disposition of assets in the Trust Property, in the ordinary course of business,
of inventory held in the ordinary course of business and other sales, transfers,
or other dispositions of assets in the Trust Property in the ordinary course of
business; provided that all provisions of the Indenture are complied with,
including, without limitation, Sections 4.10 and 4.23.
"Permitted Investments" means (i) any Investment in the Issuers or in a
Wholly Owned Subsidiary of the Issuers that is engaged in the Gaming Business
and that is evidenced by Capital Stock or Subsidiary Intercompany Notes that are
pledged to the Trustee as Note Collateral; (ii) any Investment in Cash
Equivalents; (iii) any Investment by the Issuers or any Subsidiary of the
Issuers in a Person that is evidenced by Capital Stock or Subsidiary
Intercompany Notes that are pledged to the Trustee as Note Collateral, if as a
result of such Investment (a) such Person becomes a Wholly Owned Subsidiary of
the Issuers engaged in the Gaming Business or (b) such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the Issuers or a Wholly Owned
Subsidiary of the Issuers and that is engaged in the Gaming Business; (iv) any
Restricted Investment made as a result of the receipt of non-cash consideration
from an Asset Sale that was made pursuant to and in compliance with Section 4.10
of the Indenture; (v) any acquisition of assets solely in exchange for the
issuance of Equity Interests (other than Disqualified Stock) of the Issuers; and
(vi) after the Isle-Black Hawk is Operating, any purchases from time to time by
the Company of Notes.
"Permitted Liens" means (i) Liens on property of a Person existing at the
time such Person is merged into or consolidated with the Issuers or any
Subsidiary of the Issuers; provided
xvi
that such Liens were in existence prior to the contemplation of such merger or
consolidation and do not extend to any assets other than those of the Person
merged into or consolidated with the Issuers; (ii) Liens on property existing at
the time of acquisition thereof by the Issuers or any Subsidiary of the Issuers
(other than materials, supplies or FF&E acquired in connection with developing,
constructing or equipping of, or commencing operations at, the Isle-Black Hawk),
provided that such Liens were in existence prior to the contemplation of such
acquisition; (iii) Liens existing on the date of the Indenture and previously
disclosed to the Trustee in writing; (iv) Liens for taxes, assessments or
governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded; provided that any reserve or other appropriate provision
as shall be required in conformity with GAAP shall have been made therefor; (v)
statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers,
materialmen, repairmen or other like Liens arising in the ordinary course of
business and with respect to amounts not yet delinquent or being contested in
good faith by an appropriate process of law, and for which a reserve or other
appropriate provision, if any, as shall be required by GAAP shall have been
made, and, with respect to such Liens arising in connection with the Isle-Black
Hawk, (a) the work or supplies provided which gave rise to such lien were
contemplated by the Design-Build Agreement; (b) there is no Default or Event of
Default under the Cash Collateral and Disbursement Agreement and (c) the payment
for such work or supplies is payable under the payment bond obtained by Xxxxxxxx
Construction, Inc. pursuant to the Design-Build Agreement; (vi) Liens on FF&E to
secure Indebtedness permitted by clauses (ii) and (viii) of the second paragraph
of Section 4.9 of the Indenture; (vii) Liens securing obligations in respect of
the Indenture or the Notes; (viii) pledges or deposits in the ordinary course of
business to secure lease obligations or nondelinquent obligations under workers'
compensation, unemployment insurance or similar legislation; (ix) easements,
rights-of-way, restrictions, minor defects or irregularities in title and other
similar charges or encumbrances not interfering in any material respect with the
business or assets of the Company or any Subsidiary incurred in the ordinary
course of business; and (x) Liens arising from filing Uniform Commercial Code
financing statements for a precautionary purpose in connection with true leases
of personal property that are otherwise permitted under the Indenture and under
which the Issuers or any Subsidiary is lessee.
"Person" means an individual, partnership, limited liability company,
corporation, trust or unincorporated organization and a government agency or a
political subdivision thereof.
"Plans" means the plans, specifications, working drawings, change orders,
correspondence and related items, which may be amended by the Company, as the
case may be, as necessary or appropriate, that collectively; (i) provide for and
detail the manner of development, construction and equipping of the Isle-Black
Hawk; (ii) call for construction which shall permit the Isle-Black Hawk to be
Operating on or prior to the Operating Deadline, subject only to Permitted
Liens; (iii) call for construction which shall cause the Isle-Black Hawk to be
Operating for a total cost consistent with its Construction Disbursement Budget
(as defined in the Cash Collateral and Disbursement Agreement) and the line
items set forth therein; (iv) provide for and detail the manner of development,
construction and equipping of, and the related budget for, the hotel which may
be built in connection with the Isle-Black Hawk pursuant to the
xvii
that such Liens were in existence prior to the contemplation of such merger or
consolidation and do not extend to any assets other than those of the Person
merged into or consolidated with the Issuers; (ii) Liens on property existing at
the time of acquisition thereof by the Issuers or any Subsidiary of the Issuers
(other than materials, supplies or FF&E acquired in connection with developing,
constructing or equipping of, or commencing operations at, the Isle-Black Hawk),
provided that such Liens were in existence prior to the contemplation of such
acquisition; (iii) Liens existing on the date of the Indenture and previously
disclosed to the Trustee in writing; (iv) Liens for taxes, assessments or
governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded; provided that any reserve or other appropriate provision
as shall be required in conformity with GAAP shall have been made therefor; (v)
statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers,
materialmen, repairmen or other like Liens arising in the ordinary course of
business and with respect to amounts not yet delinquent or being contested in
good faith by an appropriate process of law, and for which a reserve or other
appropriate provision, if any, as shall be required by GAAP shall have been
made, and, with respect to such Liens arising in connection with the Isle-Black
Hawk, (a) the work or supplies provided which gave rise to such lien were
contemplated by the Design-Build Agreement; (b) there is no Default or Event of
Default under the Cash Collateral and Disbursement Agreement and (c) the payment
for such work or supplies is payable under the payment bond obtained by Xxxxxxxx
Construction, Inc. pursuant to the Design-Build Agreement; (vi) Liens on FF&E to
secure Indebtedness permitted by clauses (ii) and (viii) of the second paragraph
of Section 4.9 of the Indenture; (vii) Liens securing obligations in respect of
the Indenture or the Notes; (viii) pledges or deposits in the ordinary course of
business to secure lease obligations or nondelinquent obligations under workers'
compensation, unemployment insurance or similar legislation; (ix) easements,
rights-of-way, restrictions, minor defects or irregularities in title and other
similar charges or encumbrances not interfering in any material respect with the
business or assets of the Company or any Subsidiary incurred in the ordinary
course of business; and (x) Liens arising from filing Uniform Commercial Code
financing statements for a precautionary purpose in connection with true leases
of personal property that are otherwise permitted under the Indenture and under
which the Issuers or any Subsidiary is lessee.
"Person" means an individual, partnership, limited liability company,
corporation, trust or unincorporated organization and a government agency or a
political subdivision thereof.
"Plans" means the plans, specifications, working drawings, change orders,
correspondence and related items, which may be amended by the Company, as the
case may be, as necessary or appropriate, that collectively; (i) provide for and
detail the manner of development, construction and equipping of the Isle-Black
Hawk; (ii) call for construction which shall permit the Isle-Black Hawk to be
Operating on or prior to the Operating Deadline, subject only to Permitted
Liens; (iii) call for construction which shall cause the Isle-Black Hawk to be
Operating for a total cost consistent with its Construction Disbursement Budget
(as defined in the Cash Collateral and Disbursement Agreement) and the line
items set forth therein; (iv) provide for and detail the manner of development,
construction and equipping of, and the related budget for, the hotel which may
be built in connection with the Isle-Black Hawk pursuant to the
xvii
Company's exercise of the Hotel Option, in accordance with the Construction
Disbursement Budget, as amended, and the line items set forth therein; (v) to
the extent such Plans are amended, in the reasonable, professional judgment of
the Independent Construction Consultant, continue to represent a logical
evolution consistent with previous Plans; and (vi) together with any amendments,
and are consistent with the description of the Isle-Black Hawk contained herein,
and are consistent with all governmental approvals are requirements, including,
without limitation, the Black Hawk Building Department, Historical Architecture
Review Commission, Gaming Authorities and the Subdivision Agreement.
"Project" means the Isle of Capri casino as described in the Offering
Circular, as the Plans may be amended pursuant to the Collateral Documents and
the Indenture, but excluding (i) any obsolete personal property or real property
improvements determined in good faith by either Trustor's Board of Directors to
be no longer useful or necessary to the operations or support of the Project and
(ii) any equipment leased from a third party in the ordinary course of business.
"Registration Rights Agreement" means the Registration Rights Agreement,
dated as of August 20, 1997, among the Issuers and the other party named on the
signature page thereof, as such agreement may be amended, modified or
supplemented from time to time.
"Restricted Investment" means an Investment other than a Permitted
Investment .
"Restricted Payment" means any of the following payments or other actions:
(i) declaration or payment of any dividend or any other payment or distribution
on account of the Company's or any of its Subsidiaries' Equity Interests
(including, without limitation, any payment in connection with any merger or
consolidation involving the Company) or to the direct or indirect holders of the
Company's or any of its Subsidiaries' Equity Interests in any capacity (other
than dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company or dividends or distributions payable to the
Company by a Wholly Owned Subsidiary or a Substantially Owned Subsidiary); (ii)
purchase, redemption or other acquisition or retirement for value (including,
without limitation, in connection with any merger or consolidation involving the
Company) of any Equity Interests of the Company or any direct or indirect parent
of the Company or other Affiliate of the Company (other than any such Equity
Interests owned by the Company or any Wholly Owned Subsidiary of the Company);
(iii) any payment on or with respect to, or purchase, redemption, defeasance or
other acquisition or retirement for value of any Indebtedness that is pari passu
with or subordinated to the Notes (other than Notes), in each case except a
payment of interest (other than interest payable in Indebtedness incurred
pursuant to clause (x) of the second paragraph of Section 4.9 of the Indenture)
or a payment of principal on Indebtedness on or after the due date thereof in
accordance with the payment provisions thereof in each case as such Indebtedness
was permitted pursuant to Section 4.9 of the Indenture; or (iv) any Restricted
Investment.
"Semiannual Period" means the two fiscal quarter periods ending during the
January or July immediately preceding the applicable interest payment date.
xviii
"Significant Subsidiary" means any Subsidiary that would be a significant
subsidiary as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Exchange Act, as such Regulation is in effect on the date of the
Indenture.
"Subdivision Agreement" means the Subdivision Agreement to be entered into
after the issuance of the Notes, between the Company and the city of Black Hawk,
Colorado.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (b)
the only general partners of which are such Person or one or more Subsidiaries
of such Person (or any combination thereof).
"Subsidiary Intercompany Notes" means the intercompany notes senior to any
subordinated debt of, and pari passu with all existing senior Indebtedness of
the issuing Subsidiary, issued by Subsidiaries of the Company in favor of the
Company to evidence advances by the Company, in each case, in the form attached
as an exhibit to the Indenture.
"Substantially Owned Subsidiary" of any Person means a Subsidiary of such
Person at least 80% of the outstanding Capital Stock or other ownership interest
of which (other than directors' qualifying shares) shall at the time be owned by
one or more Wholly Owned Subsidiaries of such Person or by such Person and one
or more Wholly Owned Subsidiaries of such Person.
"Trustee" means IBJ Xxxxxxxx Bank & Trust Company, as trustee under the
Indenture.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person
all of the outstanding Capital Stock or other ownership interests of which
(other than directors' qualifying shares) shall at the time be owned by such
Person or by one or more Wholly Owned Subsidiaries of such Person and one or
more Wholly Owned Subsidiaries of such Person.
xix
ANNEX B
-------
(Attached to and forming a part of the Deed of Trust to Public
Trustee, Security Agreement, Financing Statement and Assignment
of Rents and Leases, dated August 20, 1997 to the Public Trustee of
the County of Xxxxxx, Colorado, from
Isle of Capri Black Hawk L.L.C. and Isle of Capri Black Hawk Capital Corp.
for the benefit of IBJ Xxxxxxxx Bank & Trust Company)
NOTICE PROVISION
----------------
Any notice or communication by any party to the others is duly given if in
writing and delivered in Person or mailed by first class mail (registered or
certified, return receipt requested), telex, telecopier or overnight air courier
guaranteeing next day delivery, to the others' address:
If to the Trustors:
Isle of Capri Black Hawk L.L.C.
Isle of Capri Black Hawk Capital Corp.
c/o Casino America, Inc., Manager
000 Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: President
With a copy to:
Xxxxx, Xxxxx & Xxxxx
000 X. XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxx Xxxxxx
If to the Beneficiary:
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Any party, by notice to the others, may designate additional or different
addresses for subsequent notices or communications.
All notices and communications shall be deemed to have been duly given: at
the time delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt acknowledged, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
