EXHIBIT A
FIRST AMENDED
LOAN AGREEMENT
This FIRST AMENDED LOAN AGREEMENT ("AGREEMENT") is made and entered
into as of this 19 day of December, 1997, by and between Value Partners,
Ltd., a Texas Limited Partnership ("LENDER") and Trans World Gaming Corp.,
a Nevada Corporation (the "BORROWER").
R E C I T A L S
1. By that certain Loan Agreement dated October 27, 1997, Lender
agreed to loan to Borrower up to the sum of $2,625,000.00 upon the terms
and conditions set forth therein (the "Prior Loan Agreement"). This
Agreement amends, renews, reinstates, modifies, restates and replaces in
its entirety the prior Loan Agreement and that certain Senior Secured
Promissory Note dated October 27, 1997 in relation thereto (the "Prior
Note"). This Agreement is entitled to all of the liens, benefits,
priorities, rights and privileges of the Prior Loan Agreement and Prior
Note. Pursuant to the terms and conditions hereof, Lender is agreeing to
loan to Borrower and Borrower is agreeing to borrow from Lender a total of
$4,125,000.00.
2. Borrower has requested that Lender loan to Borrower and Lender is
willing to loan to Borrower up to the sum of $4,125,000.00 (the "Loan
Amount") upon the terms and subject to conditions hereinafter set forth. To
further induce this loan, Borrower has offered to issue to Lender warrants
to purchase .1714 shares of Common Stock of the Borrower for each dollar
loaned Borrower, as set forth hereinafter (the "Warrant(s)"). To evidence
this loan, Borrower shall execute that certain First Amended Senior Secured
Promissory Note (the "Note") in the form attached hereto as Exhibit A, that
certain Certificate of No Oral Agreements in the form attached hereto as
Exhibit "B" (the "Certificate") and all other documents as set forth on the
Certificate and such other documents as are necessary to this loan
transaction or otherwise required pursuant to the terms hereof (the
"Related Documents") (this Agreement, the Warrants, in the form attached
hereto as Exhibit C, the Note, the Certificate and the Related Documents
shall be referred to collectively as the "Loan Documents"). For purposes
of this Agreement all exhibits attached hereto are by this reference
incorporated herein. The term "Holder", as used herein, refers to the
Lender and each successive owner and holder of the Note.
3. As of December 17, 1997, $1,228,000.00 of the Loan Amount has
been advanced by Lender to Borrower.
AGREEMENT:
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and legal sufficiency of which are
hereby acknowledged, Lender and Borrower agree:
1. REFERENCES IN LOAN DOCUMENTS. All references in the Loan Documents
to the Note shall henceforth include references to the Note, as such Note
may, from time to time, be amended, modified, extended, renewed,
reinstated, decreased, and/or increased.
2. EXECUTION OF DOCUMENTS. Subject to the terms and conditions set
forth herein, Borrower will execute in favor of Lender the Loan Documents.
Upon execution of the Loan Documents, the Prior Note shall be returned to
Borrower marked cancelled.
3. PURPOSE OF LOAN. Borrower represents that it is negotiating an
agreement to acquire two casinos and related assets and permission to
license a third casino in the Czech Republic (the "Czech Transaction"), is
exploring an opportunity to acquire a casino in Zaragoza, Spain and a new
license for a downtown casino (the "Zaragoza Transaction"), is exploring an
opportunity to enter into a management agreement to operate the gambling
operation of an ocean going vessel off of the Florida Coast (the "Florida
Transaction"); and is negotiating an agreement to invest in and manage two
separate facilities, a casino and a slot machine facility, in Bishkek,
Kyrgyzstan (the "Bishkek Transaction"). The Czech Transaction, the
Zaragoza Transaction, the Bishkek Transaction and the Florida Transaction
are referred to herein collectively as the "Transaction(s)". All
agreements related to such Transactions must be approved in writing by
Lender as to form and content. Copies of agreements or term sheets related
thereto are attached hereto as Exhibits D, E, F and G respectively.
Attachment hereto shall not constitute approval by the Lender of these
documents. Subject to this Agreement, proceeds of this loan are to be used
(a) to fund an escrow account established pursuant to agreements executed
with respect to the Czech Transaction ($525,000), (b) the purchase price of
the ▇▇▇▇▇▇▇ Stock, as defined herein, the purchase price of collateral for
a letter of credit and certain operating expenses pursuant to agreements
executed with respect to the Zaragoza Transaction ($1,968,074.24), (c) the
purchase price, operating expenses and cage funds pursuant to agreements
executed with respect to the Florida Transaction ($450,000), and (d) the
refurbishing and funding of the casino and the refurbishing, funding and
purchase of slot machines as to the "slot room" with respect to the Bishkek
Transaction ($450,000). The sum of $821,074.24 was advanced in relation to
the Zaragoza Transaction on October 28, 1997, as set forth in more detail
in paragraph 9 herein. The sum of $406,925.76 was advanced on October 29,
1997 and was used in part to repay to Lender on October 30, 1997 all sums
due under that certain $350,000 Senior Promissory Note executed by Borrower
in favor of Lender as of June 11, 1997 as referenced in paragraph 5(h)
below, and the balance for general operating needs of Borrower. On or
about December 18, 1997, Borrower repaid to Lender the sum of $800,018.30
from sums placed in escrow by Borrower pursuant to paragraph 9(a) herein.
4. CONVERSION RIGHTS. The Borrower represents to Lender that it
intends to issue debt and equity instruments, in form and substance
acceptable to Lender if Lender is a member of the investor group (including
through conversion as set forth herein), in the approximate total sum of up
to $16,000,000, the proceeds of which are contemplated to be used to
complete the Czech Transaction, and for other needs of Borrower, as set
forth in Exhibit "H" (the "New Issue"). Attachment hereto does not
constitute approval by Lender of the business plan. At the option of
Lender, Lender may (i) require immediate repayment of all or a portion of
sums due under the Note and Loan Documents pursuant to the terms thereof
from the first dollars received by Borrower from the New Issue, and/or (ii)
convert all or a portion of the unpaid principal sum due Lender under the
Note to indebtedness and equity, on a dollar for dollar basis, issued
pursuant to the New Issue. In the event of such conversion, Lender shall
be entitled to all benefits of the New Issue, on a pari passu basis with
the other investors in the New Issue. In the event of such a conversion,
the Warrants shall be converted to the terms of the warrants, in form and
substance acceptable to Lender included within the New Issue. The number
of shares of New Issue warrants issued in the event of conversion shall be
the greater of (a) Warrants issued to Lender pursuant to the terms of this
Agreement as to such sums converted, or (b) warrants convertible into
shares of Common Stock which an investor in the New Issue who invests the
converted sum would receive. Should the New Issue occur, Borrower shall
provide written notice thereof and Holder shall, not less than (20) twenty
days prior to the date the New Issue must be closed, be provided notice and
all relevant documents comprising the New Issue. Holder shall, not less
than five days prior to the New Issue closing date notify the Borrower if
it desires to convert the Note or require repayment of the Note from the
proceeds of the New Issue. In the event Holder makes no election, the Loan
Documents shall continue in full force and effect. In the event of
conversion, all unpaid interest and other sums due under the Note, other
than unpaid converted principal, shall be paid in full in cash on the date
conversion occurs. The right to convert shall expire when all principal due
pursuant to the Note is paid in full in conformance with the Loan
Documents. Borrower may not prepay the principal obligation arising under
the Note without the written consent of Holder. There shall be no penalty
for authorized prepayment of the Note. Nothing herein shall excuse the
Borrower from any payment or other obligations required under the terms of
the Note or be deemed a waiver of any right or remedy granted Lender in the
Loan Documents, including acceleration. A "Business Day" is any day that
commercial banks are permitted to be open for business in New York City,
New York, U.S.A.
5. AGREEMENT TO ADVANCE. Upon Borrower's compliance with the
requirements of Lender set forth in this Agreement and subject to the terms
and conditions hereof, Lender shall advance to Borrower a total amount not
to exceed four million one hundred twenty-five thousand dollars and no
cents ($4,125,000.00) in increments as set forth below. Borrower agrees
that advances of the Loan Amount shall be made only for the following
purposes, in the following increments, in compliance with the terms hereof:
a. Purchase Price - ninety percent of
authorized, issued Common Stock
of Casino ▇▇ ▇▇▇▇▇▇▇▇ from the
owner of Casino ▇▇ ▇▇▇▇▇▇▇▇
(advanced October 28, 1997) $821,074.24
b. Recapitalization of Casino ▇▇
▇▇▇▇▇▇▇▇ $250,000
c. Recapture of costs incurred by
Borrower associated with Casino
▇▇ ▇▇▇▇▇▇▇▇ $172,000
d. Acquisition fee - Florida Transaction $250,000
e. Funds to operate Florida Casino -
Florida Transaction $100,000
f. Money to fund the "cage" - Florida
Transaction $100,000
As is set forth in paragraphs 3 and 9, $800,018.30 of this amount was
repaid on December 18, 1997. Such sum may be readvanced in compliance
with this Agreement.
g. Escrow Deposit with Sellers of Czech
Casinos $525,000
h. General operations of Borrower and
repayment of $350,000 Senior Promissory
Note ($406,925.76 advanced October 29,
1997) $731,925.76
i. To Purchase Certificate of Deposit
to secure letter of credit in favor
of the Diputacion General de ▇▇▇▇▇▇
of the Provincial Government of
Zaragoza Transaction Aragon, Spain
(the "DGA") - $725,000
j. To fund obligations related to operation
of casino in Bishkek Transaction $200,000
k. To fund obligations related to operation
of "slot room" in Bishkek Transaction $250,000
6. CONDITIONS PRECEDENT FOR ADVANCES. Prior to any advance of a
portion of the Loan Amount, other than that sum designated for general
requirements and repayment of the $350,000 Senior Promissory Note (section
5(h)), the following conditions shall be met:
a. A Certificate of the President of Borrower ("Certificate of
Borrower") in a form acceptable to Lender shall be delivered
to Lender wherein Borrower certifies as follows:
(i) That all documents and agreements requisite to such
an advance, including as to the Transaction for which
such advance is to be made, have been executed (or
are ready for execution) and that such sum is payable
by Borrower.
(ii) That Borrower and any present or future, wholly or
partially owned subsidiary, direct or indirect,
and/or affiliate (collectively the "Affiliate" or
the "Affiliates") have complied with all documents
and agreements related to such an advance, including
the Loan Documents and documents related to such
Transaction. Affiliate shall not be construed to
create personal liability for individual officers,
directors and/or employees of the Borrower or any
Affiliate.
(iii) That there are no liens or encumbrances against
assets acquired by Borrower or Affiliates with the
proceeds of such advance, other than as granted to
Lender in connection herewith or consented to in
writing by Lender.
(iv) That no default exists under the Loan Documents and
that no event has occurred as of such date that with
the giving of notice or otherwise would constitute an
event of default of the Loan Documents.
(v) That, to the actual knowledge of Borrower, Borrower
and/or Affiliates can perform all terms and
conditions of the Transaction as to which the advance
is requested, including those unrelated to the
advance.
(vi) That all representations and warranties of Borrower
in the Loan Documents are true and correct at the
time of such request.
(vii) Borrower knows of no event or circumstance which
makes it unlikely that the Transaction can be
successfully completed and its business purpose
achieved, as that purpose is described in Exhibit "H"
hereto.
b. All statements set forth in such Certificate of Borrower are
true and correct.
c. Any consents, certificates, approvals, permits, licenses,
bonds,
agreements, releases, lien waivers, evidence of partial or
final completion, bills, invoices, receipts, subordinations,
affidavits, or such other documents as required by
applicable law or by the Loan Documents or as Lender may
otherwise reasonably require have been obtained.
d. In addition, as to the Zaragoza Transaction, the following
shall be delivered to Lender:
(i) By Borrower, documents evidencing that the bank
guarantee required to be provided in favor of the DGA
as well as similar guarantees as may be necessary with
respect of other preferred creditors, has been obtained
on terms and conditions acceptable to Lender, in
Lender's sole and absolute discretion.
(ii) An opinion from counsel to Lender domiciled in Spain in
a form acceptable to Lender that the Zaragoza
Transaction complies with all applicable laws,
including those of the province of ▇▇▇▇▇▇▇▇ and the
federal government of Spain and the European Economic
Community. This is for the benefit of the Lender and
may not be relied upon or required by Borrower. Lender
may waive such requirement at its sole discretion or
may postpone requesting such opinion to permit Lender
to utilize rights granted it in paragraph 9 hereto.
7. ADDITIONAL OBLIGATIONS. As soon as is reasonably possible
following an advance, Borrower shall, where permissible under applicable
law, cause the following to occur:
a. Delivery by Borrower to Lender of a guaranty of the
Borrower's obligations under the Loan Documents in a form
reasonably acceptable to Lender by every Affiliate involved
in any manner in any of the Transactions or by any entity
created or acquired by Borrower to facilitate any of the
Transactions.
b. Delivery by Borrower to Lender in form and substance
acceptable to Lender of documents granting to Lender a
perfected security interest in all property of any kind or
nature acquired with the advances. Borrower shall cause any
Affiliate which acquires property with such advance to
execute documents in a form and substance acceptable to
Lender which grant to Lender a first lien and security
interest in such property. Borrower shall execute documents
necessary to grant to Lender a first lien and security
interest in the capital stock of each Affiliate which
benefits, either directly or indirectly, from such an
advance and shall cause each Affiliate which benefits
directly or indirectly, to execute a security interest in
each of their Affiliates and/or assets acquired with such
advances. This shall be construed as broadly as possible in
favor of Lender and shall include any parent of any
Affiliate that owns acquired property, any parent of such
parent, such that all direct or indirect subsidiaries of
Borrower involved in the Transaction are pledged to Lender.
Such entities shall also execute a guaranty of such
indebtedness as a component of such transaction. Borrower
and such Affiliates shall also take all steps necessary to
perfect such security interests in favor of Lender.
Borrower acknowledges that this includes, but is not limited
to a security interest in the following property if the
advance related to such Transaction is made:
(i) Promissory Note in the sum of $250,000 executed in
favor of Borrower by Boca Casino Cruises, Inc. in the
Florida Transaction.
(ii) The Casino Management Contract and Consulting
Agreement and cash flow resulting therefrom (Florida
Transaction).
(iii) Sums escrowed by Borrower with sellers of property to
Borrower or Affiliate (Czech Transaction and Zaragoza
Transaction). Such escrow agreement shall also
include irrevocable provisions providing that such
sums shall be wire transferred to Lender in lieu of
being returned to Borrower or an Affiliate or agent
of Borrower or Affiliate. Such sums shall be deemed
a payment by Borrower on the Note.
(iv) $100,000 cage cash - Florida Transaction
(v) Stock of Art Marketing, Ltd., a British Corporation,
and each Affiliate which holds assets, directly, or
indirectly, acquired pursuant to the Zaragoza
Transaction.
(vi) All real and personal property comprising Casino ▇▇
▇▇▇▇▇▇▇▇.
(vii) Bank Accounts of Borrower in Czech Republic.
(viii)Certificate of Deposit pledged to secure the DGA
letter of credit obligation.
(ix) Any management contract and/or consulting agreement
related to the Bishkek Transaction.
(x) All personal property acquired by the Borrower or any
Affiliate thereof with advances made in the Bishkek
Transaction, with standard after acquired property
protection.
8. ADVANCES.
a. Lender shall advance proceeds in compliance with the terms
hereof. All such advances shall be charged against the
Note.
b. At least five (5) Business Days prior to the date on which
each advance is to be made, all documents, instruments, and
writings that may then be required by Lender shall be
delivered to Lender. The proceeds of each advance shall be
applied solely to the payment of those items set forth in
such requisition and approved by Lender. Any advances made
by Lender prior to the fulfillment by Borrower of any
requirements of Lender or any condition precedent set forth
in this Agreement shall not be deemed a waiver of Lender's
right to have such requirement or condition precedent
fulfilled, including prior to advancing future Loan Amounts.
The failure to subsequently fulfill such requirements or
conditions precedent within the time period reasonably
required by Lender shall be deemed a default by Borrower.
Lender may, but shall not be obligated to, advance an amount
that exceeds the face amount of the Note.
c. Lender shall have no obligation to make any advance if, at
the time of such advance is to be made:
(i) Borrower is in default with respect to any provision of
the Loan Documents or of any instrument, document or
writing referenced herein.
(ii) Lender determines, in good faith, that Borrower is
incapable of performing under the terms of any of the
documents executed with respect to the Transaction
related to such advance.
(iii) Lender determines that Borrower cannot complete
any of the Transactions which are the purpose of this
Agreement.
(iv) Lender determines Borrower cannot obtain funding for
the New Issue.
(v) Lender has not approved the form of documents related
to the Transaction for which such advance is requested.
(vi) Lender does not approve of the Transaction for any
reason, in its sole discretion, as to which the advance
is requested.
(vii) Lender determines in good faith after consultation
with Borrower that Borrower has not fulfilled each of
the conditions precedent with respect to such advance.
d. Lender shall have no obligation, either express or implied,
to Borrower, or to any third parties to verify that advances
made pursuant to this Agreement are actually used for the
purpose herein. No party may be a third party beneficiary
of this Agreement.
e. Lender shall have no liability or obligation, either express
or implied, to Borrower or to any third parties, in
connection with the Transactions, except to advance monies
as provided under this Agreement. Further, Lender is not
liable for the performance of any other third parties nor
for any failure of such party to perform any obligations to
Borrower. Nothing under this Agreement shall be construed
as a representation or warranty, express or implied, on
Lender's part, to any party, other than Lender's
representations to Borrower as set forth in paragraph 14
herein. Any advance made by Lender shall not be deemed an
agreement by Lender that Borrower is in compliance with
this Agreement, that Lender has determined that Borrower has
so complied or that any of those factors as set forth in
paragraph 8(c) hereto are correct.
9. ZARAGOZA TRANSACTION. Borrower represents and agrees as follows:
a. ACQUISITION OF STOCK. Borrower has requested and received
an advance related to the Zaragoza Transaction in the sum of
$821,074.24, which advance Borrower placed into a bank
account in Spain controlled only by Borrower. Had certain
conditions occurred, this money was to be used to acquire
ninety percent (90%) of the shares of Common Stock of Casino
de ▇▇▇▇▇▇▇▇ ▇▇ from SR ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇ Stock").
Because terms and conditions regarding the acquisition of
the ▇▇▇▇▇▇▇ Stock as well as the acquisition of a new casino
in downtown Zaragoza did not occur, the sum of $800,018.30
was released from the escrow and repaid to Lender on
December 18, 1997. Because this sum of $800,018.30 was
repaid in this manner, Lender has agreed to waive its right
to receive Warrants pursuant to Section 11 herein as to such
advance. Should sums related to the Zaragoza Transaction be
requested in the future and advanced by Lender, Section 11
shall apply to such sums.
b. LETTER OF CREDIT. Borrower may request an advance related
to the Zaragoza Transaction in the sum of $725,000.00, which
advance shall be used to purchase certificates of deposit to
be used as collateral ("Collateral CD's") in favor of a
financial institution located in the United States of
America mutually acceptable to Borrower and Lender. Such
Collateral CD's are to be used to secure a letter of credit
by Borrower in favor of a bank in Spain which issues a bank
guarantee or similar instrument in the sum of approximately
$700,000.00 in favor of the DGA. This bank guarantee is
required by the DGA as a component of the Zaragoza
Transaction. Lender shall be granted a security interest in
such Collateral CD's. Documents controlling these
Collateral CD's shall provide for the release of such
Collateral CD's to Lender as a payment on the Note in the
event the DGA approval of the Zaragoza Transaction is not
obtained or in the event the ▇▇▇▇▇▇▇ Stock is not acquired
by Borrower or an Affiliate. Borrower shall not request nor
be eligible to receive this advance unless the ability of
the DGA to draw under the terms of the contemplated bank
guarantee is conditioned upon Borrower or an Affiliate
having received from the DGA irrevocable authorization to
operate a casino in downtown Zaragoza (as opposed to and in
addition to a change in the law by the local legislature
permitting such a license). Such letter of credit or bank
guarantee shall not become irrevocable until such conditions
are met and until Borrower or an Affiliate has acquired the
▇▇▇▇▇▇▇ Stock. Borrower shall only enter into such letter
of credit and/or bank guarantee upon obtaining the written
approval of Lender to do so. Lender shall not be required
to make this advance unless it, in its sole discretion,
approves the form of all documents related to such advance,
including the letter of credit and bank guarantee.
10. PAYMENTS. Borrower shall, until all obligations under the terms of
the Loan Documents are satisfied, on or before the 10th calendar day
following each three (3) calendar month period, with the first three month
period to commence as of October 1, 1997, pay or cause to be paid the sum
equal to forty percent (40%) of all cash received during that prior three
(3) month period, if any, by it or its wholly owned subsidiary, Tottenham &
Co., d/b/a ART Marketing Ltd. (the "Subsidiary") for services rendered by
Borrower or the Subsidiary as to the Boxer Casino located in the city of
Gyandja (Azerbaijon Republic), including pursuant to that Joint Activity
Agreement dated March 31, 1997 by and between Subsidiary and Mahmud
Audiyev, provided that in no event shall such sum exceed the unpaid
principal balance of the Note, together with accrued unpaid interest and
other sums due Lender under the Loan Documents as of the date of such
payment. The payment shall be applied first to unpaid fees and expenses of
Lender arising in relation to the Loan Documents, next to unpaid interest
and then to unpaid principal. The entire unpaid principal balance under
the Loan Documents and all accrued unpaid interest therein is due and
payable December 31, 1998 ("Final Maturity Date"). The obligation to pay
and all obligations arising under the Loan Documents are a general
obligation of the Borrower and are not limited to proceeds received from
the operation of the Boxer Casino. All payments to be made by Borrower to
the Lender hereunder shall be made to the Lender at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, (or to such other address as Holder may
notify the Borrower pursuant to Section 30 hereof) not later than 4:00 p.m.
Central Time on the date when due in lawful money of the United States of
America and immediately available funds. The Borrower will promptly and
punctually pay when due (whether on a scheduled payment date or at maturity
or upon the prepayment of such Note) the principal of and interest on the
Note, without any presentment thereof, directly to Holder of the Note, at
the address of such Holder shown in the register maintained by the Borrower
for such purposes or at such other addresses the Holder may from time to
time designate in writing to the Borrower or, if a bank account is
designated in any written notice to Borrower from such Holder, the Borrower
will make such payments by wire transfer or other immediately available
funds to such bank account, marked for attention as indicated, or in such
other manner or to such other account of the Holder in any bank in the
United States of America as such Holder may from time to direct in writing.
The Holder of the Note agrees that in the event it shall sell or transfer
the Note it will, prior to the delivery of the Note make a notation thereon
of all principal, if any, prepaid on such Note and will also note thereon
the date to which interest has been paid on such Note. Upon repayment in
full of the Note, the Holder of the Note shall deliver such Note to the
Borrower for cancellation. Borrower shall not be charged a penalty in the
event of prepayment of the Note, to the extent such prepayment is consented
to in writing by the Holder.
11. WARRANTS. Immediately upon receipt of an advance, Borrower shall
execute a Warrant, in the form attached hereto as Exhibit C, permitting
Lender to acquire .1714 shares of Common Stock of Borrower for each dollar
advanced.
12. CONFIRMATION OF RIGHTS. Lender shall have the right to exercise
all rights and remedies of Lender and/or any Holder under the Loan
Documents and under applicable law upon the occurrence of any default or
event of default under any of the Loan Documents and under any and all
amendments or modifications to any of the Loan Documents or to the terms
thereof.
13. REPRESENTATIONS AND WARRANTIES OF BORROWER. Borrower represents,
and warrants to the Lender as follows:
a. ORGANIZATION. STANDING. ETC. Borrower is a corporation
duly organized, validly existing and in good standing under
the laws of the State of Nevada and has all requisite
corporate power and authority to own its assets and carry on
its business as presently conducted. Borrower has all
requisite corporate power and authority to (i) execute,
deliver and perform its obligations under the Loan
Documents, (ii) issue and perform its obligations under the
Warrants, and (iii) execute, deliver and perform its
obligations under all other agreements and instruments
executed and delivered by it pursuant to or in connection
with the Loan Documents.
b. AUTHORIZATION AND EXECUTION; SHARES VALIDLY ISSUED. The
execution, delivery and performance by Borrower of the Loan
Documents and the issuance of the Warrants hereunder have
been duly and validly authorized and Borrower has the
corporate power and authority to execute, deliver and
perform this Agreement and execute the Loan Documents and
issue the Warrants hereunder. The Loan Documents have been
duly authorized, executed, issued and delivered by Borrower
and constitute a valid and binding agreement of Borrower
enforceable in accordance with its terms except to the
extent enforceability may be limited by bankruptcy,
reorganization, insolvency or other laws affecting the
enforcement of creditor's rights generally or the
availability of equitable remedies subject to the discretion
of the court.
c. CONTRAVENTION. The execution, delivery and performance of
this Agreement and the consummation of the transactions
contemplated hereby do not contravene or constitute a
default under or violate (i) any provision of applicable law
or regulation the violation of which would have a material
adverse effect on Borrower or on the Loan Documents or
Warrants, (ii) the Articles of Incorporation or Bylaws of
Borrower, or (iii) any agreement, judgment, injunction,
order, decree or other instrument binding upon Borrower or
any of its assets or properties, the violation of which
would have a material adverse effect on Borrower or result
in the creation or imposition of any lien on any asset of
Borrower, on the Loan Documents or the Warrants.
d. LITIGATION, PROCEEDINGS, DEFAULTS. Other than a lawsuit
commenced by the Borrower against the State of Louisiana,
Docket No. 434,700-D, pending in East Baton Rouge Parish and
the lawsuit, MONARCH CASINOS, INC. OF LOUISIANA ET. AL. THE
TRANS WORLD GAMING CORP., 15th Judicial District Court, Case
No. 97-5037, division B, Lafayette Parish, Louisiana, there
is no action, suit, investigation or proceeding pending
against, or to the knowledge of the Borrower threatened
against or affecting, Borrower or its assets before or by
any court or arbitrator or any governmental body, agency,
department, instrumentality or official. Borrower is not in
violation of its Articles of Incorporation or Bylaws, and
Borrower is not in violation of, or in default under any
provision of any applicable law or regulation or of any
agreement, judgment, injunction, order, decree or other
instrument binding upon Borrower which violation or default
(i) would effect the validity of this Agreement, the Note,
or the Warrants or any other document or agreement executed
or to be executed by Borrower pursuant hereto or in
connection herewith, or (ii) would impair the ability of
Borrower to perform in any material respect the obligations
which it has under the Loan Documents or the Warrants, or
any such other document or agreement.
e. GOVERNMENTAL REGULATION. Except as required pursuant to the
Securities Act of 1933 as amended, (the "Act") and State
securities laws, Borrower is not subject to any Federal or
State law or regulation limiting its ability to execute the
Loan Documents or issue the Warrants.
f. CAPITALIZATION OF BORROWER. Borrower's authorized capital
stock consists of 50,000,000 shares of Common Stock.. As of
the date of this Agreement, 3,044,286 shares of Common Stock
were issued and outstanding. All outstanding shares have
been duly authorized, validly issued and are fully paid and
nonassessable. Except with the Lender's prior consent, which
shall not be unreasonably withheld or delayed, and until the
loan is repaid or converted, and except as to the New Issue,
the Borrower will not issue additional rights,
subscriptions, warrants, options, conversion rights, or
agreements of any kind to purchase from the Borrower, or
otherwise require the Borrower to issue, any shares of
capital stock of the Borrower nor issue additional
securities or obligations of any kind convertible into or
exchangeable for any shares of capital stock of the Borrower
and the Borrower will not be subject to any new obligation
(contingent or otherwise) to repurchase or otherwise acquire
or retire any shares of its capital stock, except for the
Warrants, stock options under the 1993 Employee Stock Option
Plan and up to 150,000 warrants to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Associates pursuant to an agreement for public relations
work.
g. OWNERSHIP OF PROPERTY. Borrower has good record title in
fee simple to, or valid and subsisting leasehold interests
in, all its real property, and good title to all its other
property, in each case which is necessary or useful in the
conduct of its business. Each lease agreement under which
Borrower holds an interest in leased property is in full
force and effect.
h. DOCUMENTATION; NO MATERIAL MISSTATEMENTS. All of the
necessary documents related to the consummation of this
transaction requested by Lender have been provided by
Borrower to the Lender hereby and are true, correct and
complete in all material respects, and no written
representation, warranty or statement made by the Borrower
in or pursuant to this Agreement contains or will contain,
when made, any untrue statement of a material fact or omits
or will omit to state any material fact necessary to make
such representation, warranty or statement not misleading to
a prospective purchaser of securities from Borrower, who is
seeking full information with respect to Borrower.
i. ADDITIONAL REPRESENTATIONS, COVENANTS, AND AGREEMENTS.
Borrower further covenants and agrees:
(i) To perform all obligations under the documents
related to the Transactions, the Loan Documents and
any instrument, document, or writing referenced
herein, and to promptly pay when due, from proceeds
of the Loan Amount or from Borrower's separate funds,
all other costs, charges, and expenses incurred in
connection with the Transactions.
(ii) To keep all property to be pledged to Lender pursuant
to the Loan Documents free and clear of any and all
liens, claims and encumbrances, other than those
granted to Lender, and except as are consented to in
writing by Lender.
(iii) That all properties, real or personal, of any kind or
nature, acquired pursuant to the Transactions, either
directly or indirectly, and all property owned by any
entity acquired pursuant to the Transactions, real or
personal, shall be subject to the first lien and
security interest of Lender, subject only to those
encumbrances as are consented to in writing by
Lender.
(iv) That the monies to be advanced to Borrower under this
Agreement, together with other funds now available to
Borrower, are sufficient to meet the purposes as set
forth in this Agreement.
(v) That each advance made under this Agreement shall be
used solely for those uses as set forth herein.
(vi) That the property to be acquired pursuant to the
Transactions ("Property") is not now being used and
to the best of Borrower's knowledge has not been used
in violation of any federal, state, or local
environmental law, ordinance, or regulation; that
Borrower has not filed or been required to file any
federal, state, or local report of hazardous
substances found or disposed on any real property now
owned by Borrower; that no proceeding has been
commenced or notice received concerning any violation
of any environmental law, ordinance, or regulation;
that to the best of Borrower's knowledge the Property
is free of underground storage tanks, out-of-use
transformers, hazardous, radioactive or toxic wastes,
contamination, oil, or other materials; that the
Property shall not be used in conjunction with or for
any activity involving, directly or indirectly, the
generation, treatment, storage, transportation,
manufacture, use or disposition of hazardous or toxic
chemicals, materials, substances, or waste of any
kind; that neither the Property, the soil making up
the portion thereof, nor the ground water thereunder
making up any portion thereof shall be contaminated
so as to be subject to any "clean-up", or similar
requirement under any applicable rule, requirement,
regulation, ordinance, or law of governmental
authority that would in any way inhibit, delay, or
increase the cost of the improvement, operation, or
use of the Property; and that Borrower shall not
install, or allow to remain upon the Property, any
chemical, material, or substance, exposure to which
is prohibited, limited, or regulated by any federal,
state, or county, regional, or local authority, or
which, even if not so regulated, may or could pose a
hazard to the health and safety of the occupants of
the Property, to the owners of the properties
adjacent to the Property, or to any person.
(vii) To indemnify and hold harmless from any and all
actions, claims, demands, damages, costs, expenses,
and other liabilities, including without limitation
attorney's fees, that Lender may incur that in any
way relate to or arise out of this Agreement, the
Loan Documents and the Transactions, including
without limitation those arising out of the
negligence of Lender, but not the gross negligence,
willful misconduct, fraud or violation of law by
Lender.
(viii)That this Agreement or any right or obligation that
Borrower has under this Agreement shall not be
assigned or transferred by Borrower without the
express written consent of Lender, and that Borrower
and Borrower's successors, and assigns shall be bound
by this Agreement.
(ix) That each of the Transactions complies with all
applicable law.
14. REPRESENTATIONS AND WARRANTIES OF LENDER. The Lender represents
and warrants to Borrower as follows:
a. AUTHORIZATION AND EXECUTION. The Lender has full legal
right, power, and authority (including the due authorization
by all necessary partnership action) to enter into this
Agreement and to perform the Lender's obligations hereunder
without the need for the consent of any other person; and
this Agreement has been duly authorized, executed and
delivered and constitutes the legal, valid and binding
obligation of the Lender enforceable against the Lender in
accordance with the terms hereof, except to the extent
enforceability may be limited by bankruptcy, reorganization,
insolvency or the laws affecting the enforcement of
creditor's rights generally or the availability of equitable
remedies subject to the discretion of the court.
b. FINANCIAL RISK. The Lender is in a financial position
to hold the Note until maturity and is able to bear the
economic risk and withstand a complete loss of investment in
the Note.
c. KNOWLEDGE AND EXPERIENCE. The Lender has such knowledge
and experience in financial and business matters that the
Lender is capable of evaluating the merits and risks of the
prospective investment in the Note and the Warrants and has
the net worth to undertake such risks.
d. ADVICE. The Lender has obtained, to the extent the Lender
has deemed necessary, legal and other professional advice
and the Lender's own personal professional advice with
respect to the risks inherent in the investment in the Note,
and the suitability of the investment in the Note and the
Warrants in light of the Lender's financial condition and
investment needs.
e. SUITABLE INVESTMENT. The Lender believes that the investment
in the Note and the Warrants is suitable for the Lender
based upon the Lender's investment objectives and financial
needs, and the Lender has adequate means for providing for
the Lender's current financial needs and has no need for
liquidity of investment with respect to the Note.
f. RISK FACTORS. The Lender realizes that (i) the purchase of
the Note and the Warrants is a long term investment; (ii)
the Lender must bear the economic risk of investment until
Note matures and because the Note and the Warrants have not
been registered under the Securities Act, the Note, the
Warrants and the Common Stock for which the Warrants are
exercisable cannot be sold unless each is subsequently
registered under the Act or an exemption from such
registration is available; and (iii) there is presently no
public market for the Note or the Warrants and the Lender
may not be able to liquidate the Lender's investment in the
event of an emergency or pledge the Note or the Warrants as
collateral security for loans.
g. OWN ACCOUNT. The Lender acknowledges that the Note and the
Warrants are being purchased for the Lender's own account
and for investment and without the intention of reselling or
redistributing the same, and that the Lender made no
agreement with others regarding any of such Note, and the
Warrant.
h. NO AGREEMENTS. The Lender has no agreements (written or
oral), arrangements, understandings or commitments with any
other investor subscribing for Note or the Warrants in this
private placement of same.
i. ACCREDITED INVESTOR. The Lender is an "accredited
investor" as defined under Regulation D under the Act.
j. ENTITY REPRESENTATIONS. The Lender was not organized for
the specific purpose of acquiring the Note and has total
assets in excess of $5,000,000.
15. AFFIRMATIVE COVENANTS. Borrower covenants and agrees that so long
as the Note shall be outstanding:
a. PRINCIPAL AND INTEREST. Borrower will pay or cause to be
paid punctually the principal of and interest on the Note at
the times and places and in the manner specified in the
Note.
b. MAINTENANCE AND EXISTENCE. Borrower will at all times do or
cause to be done all things necessary to maintain, preserve
and renew its existence and its rights, patents and
franchises.
c. COMPLIANCE WITH LAWS. Borrower will comply in all material
respects with all applicable laws, rules, regulations, and
orders of the United States of America and of all foreign
countries and of any state or municipality, and of any
instrumentality or agency of any thereof (including
applicable statutes, regulations, orders and restrictions
relating to equal employment opportunities and environmental
standards or controls) in respect of the conduct of business
and the ownership of property by Borrower.
d. INSURANCE. Borrower will maintain adequate insurance with
financially sound and reputable insurance companies in such
amounts and covering such risks as is customarily carried by
companies engaged in similar businesses and similarly
situated as Borrower. Borrower shall notify Lender of any
cancellations or material changes within five (5) Business
Days of notice of such cancellation or change to the
Borrower.
e. TAXES, ASSESSMENTS AND OTHER CHARGES. Borrower will pay
punctually and discharge when due and payable: (i) all
taxes, assessments and other governmental charges levied or
imposed upon it or upon its income, profits, or properties
and (ii) all claims (including, without limitation, claims
for labor, materials, supplies, or services) which might, if
unpaid, become a lien upon any property of Borrower, except
those which the Borrower is disputing in good faith and
which dispute is being prosecuted in good faith, so long as
such process does not endanger the ability of Borrower to
perform its obligations herein.
f. INDEBTEDNESS. Borrower will pay punctually and discharge
when due and payable any indebtedness heretofore or
hereafter incurred or assumed by it and discharge, perform
and observe the covenants, provisions and conditions to be
discharged, performed and observed on the part of Borrower
in connection therewith, or in connection with any agreement
or other instrument relating thereto.
g. BOOKS. Borrower will keep at all times proper books of
record and account in which full, true and correct entries
will be made of its transactions in accordance with
applicable generally accepted accounting principles.
h. STATEMENTS, REPORTS AND CERTIFICATES TO BE DELIVERED BY THE
BORROWER. From the date hereof and so long as the Lender
shall hold the Note, Borrower will deliver to Lender at the
address shown in the register maintained by Borrower the
following:
(i) QUARTERLY FINANCIAL STATEMENTS. As soon as reasonably
possible, and in any event within 45 days after the
close of each of the first three fiscal quarters of
Borrower in each fiscal year, (1) the unaudited
balance sheet of the Borrower as of the end of such
period, setting forth in comparative form the
corresponding figures for the corresponding quarter
of the preceding fiscal year, and (2) the unaudited
statements of income and retained earnings and cash
flows of the Borrower for each quarter and for the
portion of the fiscal year ended with such quarter
and setting forth in comparative form the
corresponding figures for the corresponding periods
of the preceding fiscal year, all in reasonable
detail and certified by a principal financial officer
of Borrower subject to year-end audit adjustments.
(ii) BOXER CASINO. Not later than the fifteenth (15) day
following the end of each calendar quarter , an
unaudited statement of income and expenses for the
prior month of the Boxer Casino shall be provided to
the Lender and for any other entity or enterprise
acquired or commenced pursuant to a Transaction.
(iii) OTHER REPORTS AND STATEMENTS. Promptly upon the
mailing to its equity holders of each annual report
or other report or communication, a copy of each such
report or communication; and promptly upon any filing
by Borrower with the Securities and Exchange
Commission, or any governmental agency or agencies
substituted therefor, or with any national securities
exchange, of any annual or periodic or special report
or registration statement, a copy of such report or
statement.
(iv) CERTIFICATE OF DEFAULT. Deliver to the Lender,
forthwith upon becoming aware of any default or
defaults in the performance of any covenant,
agreement or condition contained in the Loan
Documents (including notice of any event which with
the giving of notice, lapse of time or both would
become an Event of Default), an Officer's Certificate
specifying such default or Event of Default.
(v) ADDITIONAL INFORMATION. Such other data and
information as from time to time may be reasonably
requested by the Lender.
i. OTHER DOCUMENTS. Borrower will comply will all other
covenants, representations, warranties, terms and
obligations of the Loan Documents and all other documents
executed pursuant to the terms hereof or to the Loan
Documents.
16. NEGATIVE COVENANTS. Borrower covenants and agrees that so long as
the indebtedness under the Loan Documents shall be outstanding (without the
prior written consent of Lender):
a. GUARANTEES. Borrower will not guarantee, directly or
indirectly, any obligation or indebtedness of any other
Person, other than any guarantee made with respect to the
contemplated Czech Transaction or the ▇▇▇▇▇▇▇▇ Transaction,
which guarantee shall be on terms reasonably acceptable to
Holder. "Person" shall include any individual, a
corporation, a partnership, a business entity, or a
government, foreign or domestic, or any agency or political
subdivision thereof.
b. DISTRIBUTIONS. Borrower will not declare, pay, or set apart
any funds for the payment of any distribution to any
shareholder, make any distribution in respect of equity
interests, or redeem, repurchase or effect any other sale or
exchange upon any equity interest in Borrower. The exercise
of issued and outstanding warrants shall not be deemed to be
a redemption or repurchase.
c. MERGER AND CONSOLIDATION. Borrower will not consolidate
with or merge into any other entity.
d. DISPOSITION OF ASSETS. Borrower will not sell, assign,
lease, transfer or otherwise dispose of all or any material
portion of its properties or assets to any third party, in
any transaction or series of transactions.
e. SENIOR DEBT. Subsequent to the date hereof, Borrower will
not incur, create, assume or at any time become liable,
contingently or otherwise, for any borrowed or other
indebtedness that is senior in right of payment to the
obligations created herein, other than that expressly
consented to in writing by Lender. Nothing herein shall be
construed to permit the issuance of any indebtedness that
would be secured by any collateral granted to the Lender to
secure the terms hereof other than as expressly consented to
in writing by Holder.
17. EVENT OF DEFAULT. An Event of Default shall mean the occurrence
or existence of any one or more of the following events, whether such
occurrence is voluntary or involuntary or comes about or is effected by
operation of law or pursuant to or in compliance with any judgment, decree
or order of any court or any order, rule or regulation of any
administrative or governmental authority: Events of Default include the
following:
a. The Borrower shall fail to pay the principal of, or interest
due on the Note, as and when due and payable, which failure
shall continue for a period of ten (10) days;
b. The Borrower shall fail to perform or observe any term,
covenant, or agreement contained in the Loan Documents or
any document related thereto, which failure shall continue
for a period of ten (10) days after Lender gives Borrower
notice of such failure;
c. The occurrence of a default under any documents or
instruments guaranteeing, evidencing, securing or pertaining
to the indebtedness evidenced hereby or the failure of any
such documents to remain in full force and effect;
d. If any representation, warranty or other statement of fact,
in the Loan Documents or in any writing, certificate, report
or statement at any time furnished by Borrower or any other
party obligated in relation hereto to Lender pursuant to or
in connection thereto shall be false or misleading in any
material respect; or
e. The Borrower or any other parties obligated in relation
hereto admits in writing its inability to pay debts
generally as they become due; files a petition for relief
under the bankruptcy laws or a petition to take advantage of
any insolvency act; makes an assignment for the benefit of
creditors; commences a proceeding for the appointment of a
receiver, trustee, liquidator or conservator of itself or
the whole or any substantial part of its property; files a
petition or answer seeking reorganization or arrangement or
similar relief under the Federal Bankruptcy Law or any other
applicable law or statute of the United States of America or
any State or any foreign jurisdiction; is adjudged a
bankrupt or insolvent, or a court of competent jurisdiction
shall enter any order, judgment or decree appointing a
receiver, trustee, liquidator or conservator of Borrower or
such party or of the whole or any substantial part of the
property of Borrower or such party or approves a petition
filed against a Borrower or such party seeking
reorganization or similar relief under the Federal
Bankruptcy Laws or any other applicable law or statute of
the United States of America or any State or foreign
jurisdiction; or if, under the provisions of any other law
for the relief or aid of Borrower or such party, a court of
competent jurisdiction shall assume custody or control of
Borrower or such party or the whole or any substantial part
of its property; or if there is commenced against Borrower
or such party any proceeding for any of the foregoing
relief; or if Borrower or such party, by any act indicates
its consent to approval of, or acquiescence in any such
proceeding; Borrower or such party generally, does not pay
or shall be unable to pay, its debts as such debts become
due; or
f. If any creditor of Borrower for any reason whatsoever
hereafter shall accelerate payment in whole or in part of
any outstanding material obligation owed to it by Borrower
under any agreement or arrangement due to a default or an
event of default by the Borrower, or if any judgment against
Borrower or any execution against any property of Borrower
or any amount remains unpaid, unstayed or undismissed for a
period in excess of ten (10) days; or
g. If Borrower shall cease to exist.
It is understood and agreed that time is of the essence of the Note.
If an Event of Default exists, then all amounts under the Note at the time
outstanding shall immediately become due and payable, together with
interest accrued thereon without presentment, demand, protest or notice of
any kind, including notice of intent to accelerate the payment of the
unpaid balance of the Note or in any other Loan Document or of notice of
acceleration, all of which are hereby waived by the Borrower. Any Holder
of the Note and of rights under the Loan Documents may also proceed to
protect and enforce its rights either by suit in equity and/or by action at
law, or by other appropriate proceedings, whether for the specific
performance (to the extent permitted by law) of any covenant or agreement
contained in such Loan Documents, or in aid of the exercise of any power
granted in such Loan Documents, or may proceed to enforce the payment of
such Loan Documents or to enforce any other legal or equitable right of the
holder of such Loan Documents.
18. SECURITIES LAWS RESTRICTIONS. The Lender acknowledges the Note
and the Warrants will not be sold or assigned unless the Lender shall have
obtained (i) an opinion of counsel satisfactory to the Borrower that such
proposed disposition or transfer lawfully may be made without the
registration of such Note or Warrants pursuant to the Act and applicable
state securities laws, or (ii) such registration.
19. LEGEND ON NOTE. The Lender acknowledges that the Note and the
Warrants will each bear a legend conspicuously endorsed reading
substantially as follows:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY STATE SECURITIES ACT, AND MAY NOT BE
TRANSFERRED WITHOUT REGISTRATION UNDER SUCH ACTS OR AN OPINION OF
COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT
REQUIRED.
20. WAIVER OF CLAIMS. Borrower warrants and represents to Lender that
as of the date hereof the Note is subject to no credits, charges, claims,
or rights of offset or deduction of any kind or character whatsoever; and
the Borrower releases and discharges Lender from any and all claims and
causes of action, whether known or unknown and whether now existing or
hereafter arising, including, without limitation, any usury claims, that
have at any time been owned, or that are hereafter owned by Borrower and
that arise out of or are related to the execution, delivery and performance
of the Loan Documents.
21. FINAL MATURITY DATE. The entire unpaid principal balance of the
Note and all accrued unpaid interest therein is due and payable on the
Final Maturity Date.
22. COSTS AND EXPENSES. Borrower agrees to pay all costs and
expenses incurred by Lender in connection with the execution and
consummation of this Agreement, including, without limitation, the
documented fees and expenses of Lender's counsel.
23. CONTINUED EFFECT. Except to the extent amended hereby or in
connection herewith, all terms, provisions, and conditions of the Loan
Documents shall remain enforceable and binding in accordance with their
respective terms.
24. GOVERNING LAW. The terms and provisions hereof shall be governed
by and construed in accordance with the laws of the State of New York.
25. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the respective successors and assigns of the parties hereto,
and each of the parties hereto hereby represents, warrants, and covenants
to the other that the persons executing this Agreement on behalf of such
party have full authority, power, and authorization to execute such
document and to bind its principal.
26. ENTIRE AGREEMENT. This Agreement supersedes all prior oral and
written agreements and understandings of the parties hereto with respect to
the subject matter hereof.
27. HEADINGS. The headings of the sections and subsections hereof
are inserted as a matter of convenience and for reference only and in no
way define, limit or describe the scope of this Agreement or the meaning of
any provision hereof.
28. WAIVERS. The failure of any party to act to enforce rights
hereunder shall not be deemed a waiver and shall not preclude enforcement
of any rights hereunder. No waiver of any term or provision of this
Agreement on the part of a party shall be effective for any purpose
whatsoever unless such waiver is in writing and signed by such party.
29. INVALID PROVISIONS. If any provision of this Agreement is held
to be illegal, invalid or unenforceable under present or future laws
effective during the terms hereof, such provision shall be fully severable.
This Agreement shall be construed and enforced as if such illegal, invalid
or unenforceable provision had never comprised a part hereof, and the
remaining provisions hereof shall remain in full force and effect and shall
not be affected by the illegal, invalid or unenforceable provision or by
its severance herefrom. Furthermore, in lieu of such illegal, invalid or
unenforceable provision there shall be added automatically as a part of
this Agreement a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and be legal, valid and
enforceable, which provision shall be consistent with the intent of the
parties hereto.
30. NOTICES. Any request, demand, authorization, direction, notice,
consent, waiver, instruction, document or other communication provided or
permitted by this Agreement to be made upon, given or furnished to, or
filed shall be sufficient for every purpose hereunder if in writing and
mailed, registered or certified mail, postage prepaid or delivered by
facsimile or telecopier (if confirmed), as follows:
If to Borrower, to:
Trans World Gaming Corp.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
With copies to:
Elias, Matz, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
12th Floor
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
If to Lender, to:
Value Partners, Ltd.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
With copies to:
Bergman, Yonks, ▇▇▇▇▇ & Bird L.L.P.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address as Lender may from time to time direct. Any
notice to a Holder, (other than Lender), shall be sufficiently given if in
writing and mailed, registered or certified mail, postage prepaid, to such
address as Holder shall from time to time direct in writing.
31. ATTORNEY'S FEES. In the event attorneys' fees or other costs are
incurred to secure performance of any of the obligations herein provided
for, or to establish damages for the breach thereof, or to obtain any other
appropriate relief, whether by way of prosecution or defense, the
prevailing party shall be entitled to recover reasonable attorneys' fees
and costs incurred therein.
32. FURTHER ASSURANCES. Each party hereto agrees to execute any and
all documents, and to perform such other acts, whether before or after
closing, that may be reasonably necessary or expedient to further the
purposes of this Agreement or to further assure the benefits intended to be
conferred hereby.
33. TITLE TO THE SHARES. Upon the exercise of the Warrants and the
consequent issuance of the shares of Common Stock to the Lender, the Lender
will receive the entire legal and beneficial interest in the shares of
Common Stock free and clear of all liens, claims and encumbrances.
34. NOTICE OF INVALIDITY OF ORAL AGREEMENTS. THIS WRITTEN AGREEMENT,
THE LOAN DOCUMENTS, AND ALL EXHIBITS HERETO REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
35. USURY. All agreements between Borrower and Lender, whether now
existing or hereafter arising and whether written or oral, are hereby
limited so that in no contingency, whether by reason of demand or
acceleration of the Final Maturity Date. or otherwise, shall the interest
contracted for, charged, received, paid or agreed to be paid to Lender
exceed the maximum amount permissible under the laws of the State of New
York (hereinafter the "Applicable Law"). If, from any circumstance
whatsoever, interest would otherwise be payable to Lender in excess of the
maximum amount permissible under the Applicable Law, the interest payable
to Lender shall be reduced to the maximum amount permissible under the
Applicable Law, and if from any circumstance Lender shall ever receive
anything of value deemed interest by the Applicable Law in excess of the
maximum amount permissible under the Applicable Law, an amount equal to the
excessive interest shall be applied to the reduction of the principal
hereof and not to the payment of interest, or if such excessive amount of
interest exceeds the unpaid balance of principal hereof, such excess shall
be refunded to Borrower. All interest paid or agreed to be paid to Lender
shall, to the extent permitted by the Applicable Law, be amortized,
prorated, allocated and spread throughout the full period (including any
renewal or extension) until payment in full of the principal so that the
interest hereon for such full period shall not exceed the maximum amount
permissible under the Applicable Law. Lender expressly disavows any intent
to contract for, charge or receive interest in an amount which exceeds the
maximum amount permissible under the Applicable Law. This paragraph shall
control all agreements between Borrower and Lender.
36. COUNTERPARTS. This Agreement may be executed in separate or
multiple counterparts by the parties, and all of such counterparts shall be
considered as one and the same instrument notwithstanding the fact that
various counterparts are signed by only one or more of the parties, and all
of such Agreements shall be deemed but one and the same Agreement.
37. PRIOR LOAN AGREEMENT. True and correct copies of the Prior Loan
Agreement and Prior Note are attached hereto as Exhibit I and J,
respectively.
EXECUTED as of the date first above written.
LENDER:
VALUE PARTNERS, LTD.
By: ▇▇▇▇▇▇ ▇▇▇▇▇ Partners,
Texas general partnership
General Partner
By:
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Its: General Partner
BORROWER:
TRANS WORLD GAMING CORP.,
A NEVADA CORPORATION
By:
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Its:
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