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Exhibit 4.9
INTEREST ESCROW AGREEMENT
INTEREST ESCROW AGREEMENT (this "Agreement"), dated as of
December 30, 1997, among THE RESORT AT ▇▇▇▇▇▇▇▇▇, LIMITED PARTNERSHIP (the
"Partnership"), THE RESORT AT ▇▇▇▇▇▇▇▇▇, INC. ("▇▇▇▇▇▇▇▇▇, Inc." and together
with the Partnership, the "Borrowers") and FIRST SECURITY TRUST COMPANY OF
NEVADA as agent for the Lenders referred to below (the "Collateral Agent").
Except as otherwise defined herein, terms used herein and defined in the Credit
Agreement referred to below shall be used herein as so defined.
W I T N E S S E T H :
WHEREAS, the Borrowers, the lenders (the "Lenders") from time
to time party thereto, Gleacher NatWest Inc., as Arranging Agent and National
Westminster Bank Plc as Administrative Agent (the "Administrative Agent") are
party to a Credit Agreement dated as of December 30, 1997 (as modified or
restated and in effect from time to time, the "Credit Agreement").
WHEREAS, it is a condition to the Lenders making Loans under
the Credit Agreement that this Agreement be executed and delivered by the
parties hereto;
NOW, THEREFORE, it is agreed:
SECTION 1. ESTABLISHMENT OF INTEREST ESCROW ACCOUNT; ETC.
1.01. Establishment. The Collateral Agent has established in
its own name and for the benefit of the Lenders an account (Account No. 702254D)
(the "Interest Escrow Account") for purposes of this Agreement, which Interest
Escrow Account is maintained at the Collateral Agent's office located at Las
Vegas, Nevada (ABA 1224 01668). Subject to the provisions of this Agreement, the
Interest Escrow Account shall be under the sole dominion and control of the
Collateral Agent and, except as set forth in Section 3.01, the Collateral Agent
shall have the sole right to make withdrawals from the Interest Escrow Account
and to exercise all rights with respect to the Collateral (as defined below)
from time to time therein.
1.02. Deposits to the Interest Escrows Account. On the Closing
Date, the Borrowers shall deposit $12.4 million in immediately available funds
in the Interest Escrow Account.
1.03. Investment of Deposited Funds. So long as any amounts
remain in
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the Interest Escrow Account, the Collateral Agent will from time to time, at the
request of the General Partner, invest funds on deposit in the Interest Escrow
Account in Cash Equivalents. All investments made pursuant to this Section 1.03
(and any instruments evidencing same), and all proceeds thereof, shall be held
in the Interest Escrow Account as part of the Collateral. All such investments
shall be made in the name of the Collateral Agent. All risk of loss in respect
of investments made pursuant to this Section 1.03 shall be on the Borrowers.
SECTION 2. PLEDGE AND GRANT OF SECURITY INTEREST.
2.01. Pledge and Grant of Security Interest. As collateral
security to secure the full and prompt payment when due (whether at stated
maturity, by acceleration or otherwise) of the Obligations, each Borrower hereby
pledges and assigns to the Collateral Agent, for the benefit of the Lenders, a
continuing possessory Lien and security interest in all of the right, title and
interest of such Borrower in and to the Interest Escrow Account, in all funds
deposited therein, in all investments from time to time therein, and in all cash
and non-cash proceeds of any of the foregoing (collectively, the "Collateral"),
from the date of the establishment of the Interest Escrow Account until the
termination thereof pursuant to the terms hereof. As used herein, "Obligations"
shall mean (i) the principal of and interest on the Loans made under the Credit
Agreement, (ii) all other obligations and indebtedness of each Borrower to the
Lenders now existing or hereafter incurred under, arising out of, or in
connection with the Credit Agreement and the other Credit Documents and the due
performance and compliance by each Borrower with all of the terms, conditions
and agreements contained in the Credit Agreement and the other Credit Documents,
(iii) any and all sums advanced by the Collateral Agent in order to preserve the
Collateral (as hereinafter defined) or to preserve its security interest in the
Collateral, (iv) in the event of any proceeding for the collection or
enforcement of any indebtedness, obligations or liabilities of any Borrower
referred to in clauses (i), (ii) or (iii) above, after an Event of Default shall
have occurred and be continuing, the reasonable expenses of retaking, holding,
preparing for sale or lease, selling or otherwise disposing of or realizing on
the Collateral, or of any exercise by the Collateral Agent of its rights
hereunder, together with reasonable attorneys' fees and court costs and (v) all
amounts paid by any Indemnitee (as hereinafter defined) as to which such
Indemnitee has the right to reimbursement under Section 9 hereof.
SECTION 3. WITHDRAWALS, APPLICATIONS AND REMEDIES.
3.01. Withdrawals. (a) So long as no Event of Default then
exists, the Borrowers shall have the right to cause the collateral Agent to
withdraw, for application as provided below, funds from the Interest Escrow
Account on each Business Day on which interest ("Interest") is to be paid on the
Term Loans during the first Operating Year (an "Interest Payment Date") the
amount, if any, (the "Interest Shortfall") by which the
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Interest to be paid on such date exceeds the Available Cash (as defined below)
on such date. Such withdrawals will be effected by delivery to the Collateral
Agent, no later than 12:00 (New York time) on the Business Day proceeding an
Interest Payment Date, of a certificate (a "Withdrawal Notice") executed by an
Authorized Officer of the General Partner in the form of Annex A hereto. All
funds so withdrawn shall be made available not later than 12:00 Noon (New York
time) on the Business Day requested for disbursement to the Administrative Agent
for application to pay Interest on the respective Interest Payment Date. As used
herein, "Available Cash" shall mean with respect to each Interest Payment Date
an amount that the Partnership estimates in good faith that it has available to
pay Interest on such date giving effect to the Partnership's revenues and
expenses since the Commencement Date, expenses scheduled to be paid during the
remainder of the First Operating Year, the then projected revenues for the
remainder of such First Operating Year the Partnership's minimum casino bankroll
requirements as determined in accordance with the Gaming Laws and such other
necessary cash balances as determined by the Partnership, all as computed in
reasonable detail in the relevant Withdrawal Notice, which computation shall be
satisfactory to the Administrative Agent as to methodology and factual content.
(b) On the last day of the fifth calendar quarter ending after
the Commencement Date, after giving effect to any withdrawal of funds from the
Interest Escrow Account on such day pursuant to clause (a) above, all amounts in
the Interest Escrow Account shall be withdrawn by the Collateral Agent and
transferred to the Administrative Agent to be promptly applied to repay Loans as
provided in Section 3.02(A)(h) of the Credit Agreement.
(c) To the extent required to make any withdrawal pursuant to
the foregoing clauses of this Section 3.01, the Collateral Agent shall, and is
hereby authorized to, liquidate Cash Equivalents then on deposit in the Interest
Escrow Account pursuant to its customary practices for liquidating such
securities.
(d) Collateral may only be withdrawn as provided in clauses
(a) and (b) of this Section 3.01, Section 3.02 and Section 10 and shall remain
in the Interest Escrow Account until so withdrawn. Neither the Collateral Agent
nor the Administrative Agent shall have any liability whatsoever to any Lenders
as a result of any release of Collateral following the receipt of a Withdrawal
Notice regardless of any subsequent determination that one or more of the
conditions specified herein to such withdrawal were not satisfied.
3.02. Remedies Upon an Event of Default; Application of
Proceeds. (a) If a Noticed Event of Default (as defined in the Disbursement
Agreement) shall occur and be continuing, if and to the extent directed to do so
by the Administrative Agent (acting at the direction of the Required Banks), the
Collateral Agent shall, subject to any mandatory
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requirements of applicable law (including the Gaming Laws), (i) exercise in
respect of all of the Collateral in addition to other rights and remedies
provided for herein or otherwise available to it under applicable law, all of
the rights and remedies of a secured party on default under the Uniform
Commercial Code then in effect in the State of New York or Louisiana, (ii)
liquidate all Cash Equivalents in accordance with its customary practices for
liquidating such securities and/or (iii) withdraw the Collateral, if any, from
the Interest Escrow Account and pay the same to the Administrative Agent for
application to the Obligations in accordance with Section 7.4 of the Security
Agreement executed by the Partnership.
(b) Each Borrower shall remain jointly and severally liable to
the extent of any deficiency between the amount of the proceeds of the
Collateral applied as provided in preceding clause (a) and the aggregate amount
of the Obligations.
SECTION 4. FURTHER ASSURANCES.
Each Borrower agrees that it will, at any time and from time
to time, at its expense, promptly execute and deliver all further agreements,
instruments and other documents and take all further action that may be
necessary or that the Collateral Agent or the Administrative Agent may
reasonably request in order to perfect and protect the security interest
purported to be created hereby or otherwise to enable the Collateral Agent to
exercise and enforce its rights and remedies hereunder.
SECTION 5. TRANSFERS AND OTHER LIENS.
Each Borrower agrees that it will not create or suffer to
exist any Lien upon or with respect to any Collateral except for the security
interest purported to be created hereby.
SECTION 6. ATTORNEY-IN-FACT.
Each Borrower hereby irrevocably appoints, which appointment
shall be coupled with an interest, the Collateral Agent its attorney-in-fact,
with full authority after the occurrence of and during the continuance of an
Event of Default, in the place and stead of such Borrower and in the name of
such Borrower or otherwise, from time to time in the Collateral Agent's
discretion to execute any instrument and to take any other action which the
Collateral Agent may deem necessary or advisable to accomplish the purposes of
this Agreement or to facilitate the assignment or other transfer by the
Collateral Agent of any or all of its rights hereunder.
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SECTION 7. PERFORMANCE BY THE COLLATERAL AGENT.
If any Borrower fails to perform any agreement or obligation
contained herein, the Collateral Agent itself may perform or cause performance
of such agreement or obligation, and the expenses of the Collateral Agent
incurred in connection therewith shall be payable to the Collateral Agent by the
Borrowers.
SECTION 8. RESPONSIBILITY OF THE COLLATERAL AGENT AND
ADMINISTRATIVE AGENT.
(a) Neither the Collateral Agent nor any of their respective
directors, officers, agents, employees, affiliates, representatives and agents
shall be liable for any failure to invest or reinvest any cash in the Interest
Escrow Account in accordance herewith or for any losses incurred by reason of
investments made by the Collateral Agent pursuant to Section 1.03 hereof. The
Collateral Agent and the Administrative Agent shall act hereunder on the same
terms and conditions as are set forth in Section 10 of the Credit Agreement
(which section is incorporated herein by reference with each reference therein
to "Agent" to include the Collateral Agent and Administrative Agent hereunder,
and by accepting the benefits hereof the Lenders shall be deemed to have agreed
to such provisions as so incorporated) and shall hold the Collateral in
accordance with this Agreement and with only such obligations in respect thereof
as are expressly set forth in this Agreement.
(b) The Collateral Agent acknowledges and agrees that (i) all
disbursements and releases made pursuant to this Agreement shall be made by the
Collateral Agent irrespective of, and without deduction for, any counterclaim,
defense, recoupment or set-off and shall be final, (ii) all service charges and
fees with respect to this Agreement or the Interest Escrow Account shall be paid
by the Borrowers, (iii) it irrevocably waives and renounces any pledge, security
interest (whether consensual, statutory or otherwise) or right of offset or
compensation that it has or may ever have for its own benefit with respect to
the Interest Escrow Account, (iv) it shall maintain appropriate books and
records with respect to the Interest Escrow Account in which shall be recorded
all transactions related thereto including, without limitation, all
disbursements hereunder and any investments made by the Collateral Agent and
shall permit the Administrative Agent or any of its agents or representatives to
inspect and to make copies of such books and records, as is reasonable, at the
Borrowers' sole cost and expense and (v) it shall exercise its best efforts and
utilize prudence in performing its duties hereunder in accordance with the terms
of this Agreement.
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SECTION 9. INDEMNITY.
9.1. Indemnity. (a) Each Borrower jointly and severally agrees
to indemnify, reimburse and hold the Collateral Agent and, to the extent acting
hereunder, the Administrative Agent and their respective successors, assigns,
employees, agents and servants (herein after in this Section 9.1 referred to
individually as "Indemnitee," and collectively as "Indemnitees") harmless from
any and all liabilities, obligations, damages, injuries, penalties, claims,
demands, actions, suits, judgments and any and all costs, expenses or
disbursements (including reasonable attorneys' fees and expenses) (for the
purposes of this Section 9.1 the foregoing are collectively called "expenses")
of whatsoever kind and nature imposed on, asserted against or incurred by any of
the Indemnitees in any way relating to or arising out of this Agreement or any
other document executed in connection herewith or in any other way connected
with the administration of the transactions contemplated hereby or the
enforcement of any of the terms of, or the preservation of any rights under any
thereof, or in any way relating to or arising out of the use of the Collateral;
provided that no Indemnitee shall be indemnified pursuant to this Section 9.1(a)
for expenses to the extent caused by the gross negligence or willful misconduct
of such Indemnitee.
(b) Without limiting the application of Section 9.1(a) hereof,
each Borrower jointly and severally agrees to pay, or reimburse the Collateral
Agent, for any and all fees, costs and expenses of what ever kind or nature
incurred in connection with the creation, preservation or protection of the
Collateral Agent's Liens on, and security interest in, the Collateral,
including, without limitation, all fees and taxes in connection with the
recording or filing of instruments and documents in public offices, payment or
discharge of any taxes or Liens upon or in respect of the Collateral and all
other fees, costs and expenses in connection with protecting, maintaining or
preserving the Collateral and the Collateral Agent's interest therein, whether
through judicial proceedings or otherwise, or in defending or prosecuting any
actions, suits or proceedings arising out of or relating to the Collateral.
(c) Without limiting the application of Section 9.1(a) or (b)
hereof, each Borrower jointly and severally agrees to pay, indemnify and hold
each Indemnitee harmless from and against any loss, costs, damages and expenses
which such Indemnitee may suffer, expend or incur in consequence of or growing
out of any misrepresentation by such Borrower in this Agreement or in any
writing contemplated by or made or delivered pursuant to or in connection with
this Agreement.
(d) If and to the extent that the obligations of any Borrower
under this Section 9.1 are unenforceable for any reason, such Borrower hereby
agrees to make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law.
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9.2. Indemnity Obligations Secured by Collateral; Survival.
Any amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of each Borrower contained in this Section 9 shall
continue in full force and effect notwithstanding the full payment of all
Obligations.
SECTION 10. TERMINATION; RELEASE.
(a) Upon the Termination Date (as defined below), this
Agreement shall terminate, and the Collateral Agent, at the request and expense
of the Borrowers, will execute and deliver to the Borrowers, a proper instrument
or instruments acknowledging the satisfaction and termination of this Agreement,
and will duly assign, transfer and deliver to the Borrowers (without recourse
and without any representation or warranty) such of the Collateral as may remain
in the possession of the Collateral Agent and has not theretofore been sold or
otherwise applied or released pursuant to this Agreement together with any
monies at the time held by the Collateral Agent hereunder. As used in this
Agreement, "Termination Date" shall mean the earlier of (x) that date upon which
all Commitments have terminated and all Loans and other obligations have been
repaid in full and (y) that date, occurring after the Commencement Date, which
is one Business Day after the date upon which all of the Collateral has been
applied as required by Section 3.01.
(b) At any time that the Borrowers desire that Collateral be
released as provided in the foregoing Section 10(a), the Borrowers shall deliver
to the Collateral Agent and the Administrative Agent a certificate signed by any
Authorized Officer of the General Partner stating that the release of the
respective Collateral is permitted pursuant to said Section 10(a). Neither the
Collateral Agent nor the Administrative Agent shall have any liability
whatsoever to any Lender as a result of any release of Collateral by it as
permitted by this Section 10.
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SECTION 11. NOTICES, ETC.
Except as otherwise specified herein, all notices, requests,
demands or other communications to or upon the respective parties hereto shall
be deemed to have been duly given or made when delivered to the party to which
such notice, request, demand or other communication is required or permitted to
be given or made under this Agreement, addressed as follows:
(a) if to any Borrower, at:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
(b) if to the Collateral Agent:
First Security Trust of NV
c/o First Security Bank
Trust Dept.
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(c) if to the Administrative Agent:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
or at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.
SECTION 12. MISCELLANEOUS.
This Agreement and the rights and obligations of the parties
hereunder shall be construed in accordance with and be governed by the law of
the State of New York. This Agreement shall be binding upon each Borrower and
its successors and assigns and shall inure to the benefit of and be enforceable
by the Collateral Agent and the Administrative Agent and their successors and
assigns. The headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof. This Agreement may be executed in
any number of counterparts, each of which shall be an original, but all of which
shall constitute one instrument. Delivery of an executed
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counterpart of the signature pages to this Agreement by telecopier shall be
effective as delivery of a manually executed counterpart of this Agreement. This
Agreement shall become effective on the date on which each of the parties shall
have executed and delivered a copy hereof. In the event that any provision of
this Agreement shall prove to be invalid or unenforceable, such provision shall
be deemed to be severable from the other provisions of this Agreement, which
shall remain binding on all parties hereto.
SECTION 13. WAIVER; AMENDMENT.
None of the terms and conditions of this Agreement may be
changed, waived, modified or varied in any manner whatsoever except pursuant to
a writing signed by all the parties hereto, with the Administrative Agent to act
only at the written direction of the Required Lenders or all the Lenders as
provided in Section 11.12 of the Credit Agreement. If the Collateral Agent has
been replaced as Disbursement Agent under and in accordance with Section 13 of
the Disbursement Agreement, if requested by the Borrowers, it will also at such
time be replaced hereunder by the same entity that replaces it as Disbursement
Agent (provided that such entity has became party hereto as Collateral Agent
pursuant to documentation satisfactory to the Administrative Agent) and, in such
case, the original Collateral Agent will transfer to the new Interest Escrow
Account established by the new Collateral Agent all amounts on deposit in the
original Interest Escrow Account.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their duly authorized representatives
as of the date first above written.
THE RESORT AT ▇▇▇▇▇▇▇▇▇,
LIMITED PARTNERSHIP
By___________________________________________
Title:
THE RESORT AT ▇▇▇▇▇▇▇▇▇, INC.
By___________________________________________
Title:
FIRST SECURITY TRUST OF NEVADA,
as Collateral Agent
By___________________________________________
Title:
NATIONAL WESTMINSTER BANK PLC,
as Administrative Agent
By___________________________________________
Title:
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ANNEX A
FORM OF WITHDRAWAL CERTIFICATE
[Date]
First Security Trust of Nevada, as
Collateral Agent
___________________________________
___________________________________
Attention: _______________________
Re: Request of $________ from
_________________ Account
Gentlemen:
The Resort at ▇▇▇▇▇▇▇▇▇, Inc. as General Partner (the "General
Partner") and The Resort at ▇▇▇▇▇▇▇▇▇, Limited Partnership (the "Partnership")
on behalf of itself and the Partnership requests that, in accordance with
Section 3.01(a) of that certain Interest Escrow Agreement, dated ___________ __,
1997, to which you are a party (the "Agreement"; capitalized terms used herein
shall have the meaning afforded them under the Agreement), a disbursement of
$____________ (the "Interest Shortfall") be made from the Interest Escrow
Account and paid over to National Westminster Bank Plc as Administrative Agent
under the Credit Agreement to be applied to pay Interest on _________________.
The "Interest Shortfall" equals the excess of the Interest payable on
____________ over Available Cash as of the date hereof. Set forth on Schedule I
hereto is a detailed computation of Available Cash as of the date hereof. The
Collateral Agent is entitled to rely on this certificate in making the release
of funds.
▇▇▇▇▇▇▇▇▇, INC., as General Partner
By___________________________________________
Title: