Exhibit (f)
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AMENDED AND RESTATED LOAN AGREEMENT
This Amended and Restated Loan Agreement ("Agreement") dated as of July
14, 2003, is between Bank of America, N.A. (the "Bank") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇ (collectively, the "Borrower"). This Agreement amends and
restates in its entirety that certain Loan Agreement dated as of October 30,
2002, as amended by a Modification Agreement, between the Bank and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇.
1. LINE OF CREDIT AMOUNT AND TERMS
1.1 Line of Credit Amount.
(a) During the availability period described in Section
1.2 below, the Bank will provide a line of credit to the Borrower. The
amount of the line of credit (the "Commitment") is One Hundred
Twenty-Five Million Dollars ($125,000,000).
(b) This is a revolving line of credit providing for
cash advances. During the availability period described in Section 1.2,
the Borrower may repay principal amounts and reborrow them.
(c) The Borrower agrees not to permit the outstanding
principal balance of advances under the line of credit to exceed the
limitations specified in paragraph 1.3 below.
1.2 Availability Period. The line of credit is available between
the date of this Agreement and July 14, 2006, or such earlier date as the
availability may terminate as provided in this Agreement (the "Expiration
Date").
1.3 Borrowing Base.
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(a) Eligible Collateral. The Borrower's obligations to
the Bank will be secured by the collateral acceptable to the Bank
("Eligible Collateral") that is more particularly described on Exhibit
A to this Agreement and the Borrower's interest under that lease dated
September 18, 2002 between the Borrower and ▇▇▇▇ Resorts Holdings, LLC
(the "Art Lease"). The term Eligible Collateral shall also include
those items of personal property added to maintain the collateral value
as required by Section 8.17 hereof or substituted for Eligible
Collateral in accordance with the provisions of this Agreement and the
Security Agreement, as hereinafter defined.
(b) Advance Rate. The Bank will not make any extension
of credit if, as a result, the Outstanding Balance would exceed the
Borrowing Base.
(c) Borrowing Base. The "Borrowing Base" is the sum of
the amounts determined by multiplying the Collateral Value by
forty-five percent (45%) for each type of Eligible Collateral pledged
to the Bank.
(d) Outstanding Balance. The "Outstanding Balance" means
the principal balance outstanding from time to time under this
Agreement, including the undrawn and the drawn.
(e) The "Collateral Value" of Eligible Collateral shall
be the fair market value as determined from time to time by the Bank in
its reasonable discretion.
1.4 Interest Rate.
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(a) The interest rate is a rate per year equal to the
Wall Street Journal LIBOR Daily Floating Rate plus 1.20 percentage
points.
(b) The Wall Street Journal LIBOR Daily Floating Rate
is a fluctuating rate of interest equal to the one month, two month or
three month London interbank offered rate as published in the "Money
Rates" section of The Wall Street Journal (or, if such source is not
available, such alternate source as determined by the Bank), as
adjusted from time to time in the Bank's sole discretion for reserve
requirements, deposit insurance assessment rates and other regulatory
costs. Any change in the rate will take effect on the effective date as
indicated in The Wall Street Journal. Interest will accrue on any
non-banking day at the rate in effect on the immediately preceding
banking day. The Borrower shall irrevocably notify the Bank of the
interest period selected at least one banking day prior to expiration
of the then expiring interest period. In the event the Borrower fails
to make such election, the interest rate under this Agreement shall be
the one month Wall Street Journal LIBOR Daily Floating Rate. All
amounts outstanding under this Agreement shall bear interest at the
same rate of interest. Any interest period shall expire no later than
the Expiration Date.
1.5 Repayment Terms.
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(a) The Borrower will pay interest on August 5, 2003
and then the fifth (5th) day of each month thereafter until payment in
full of all principal outstanding under this line of credit.
(b) The Borrower will repay in full all principal and
any unpaid interest or other charges outstanding under this line of
credit no later than the Expiration Date.
2. INTENTIONALLY OMITTED
3. FEES AND EXPENSES
3.1 Fees.
(a) Non-utilization fee. The Borrower agrees to pay a
quarterly non-utilization fee in an amount equal to .10% (one-tenth of
one percent) of the lesser of (i) $35,000,000 and (ii) the difference
between the Commitment and the outstanding principal balance under this
Agreement as of the date such fee is payable. This fee shall be payable
on the fifth day of January, April, June and October in each year,
commencing on October 5, 2003.
(b) Waiver Fee. If the Bank, at its discretion, agrees
to waive or amend any terms of this Agreement at the request of the
Borrower, the Borrower will, at the Bank's option, pay the Bank a fee
for each waiver or amendment in an amount advised by the Bank at the
time the Borrower requests the waiver or amendment. Nothing in this
paragraph shall imply that the Bank is obligated to agree to any waiver
or amendment requested by the Borrower. The Bank may impose additional
requirements as a condition to any waiver or amendment. No such fee
shall be due with respect to the amendments through the date of this
Agreement, including this amended and restated Agreement and the
amendment to the Security Agreement.
(c) Late Fee. To the extent permitted by law, the
Borrower agrees to pay a late fee in an amount equal to four percent
(4%) of any payment that is more than fifteen (15) days late. The
imposition and payment of a late fee shall not constitute a waiver of
the Bank's rights with respect to the default.
3.2 Expenses. The Borrower agrees to immediately repay the Bank
for reasonable expenses that include, but are not limited to, filing, recording
and search fees, appraisal fees, title report fees and documentation fees.
3.3 Reimbursement Costs.
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(a) The Borrower agrees to reimburse the Bank for any
expenses it incurs in the preparation of this Agreement and any
agreement or instrument required by this Agreement. Expenses include,
but are not limited to, reasonable attorneys' fees, including any
allocated costs of the Bank's in-house counsel.
(b) The Borrower agrees to reimburse the Bank for the cost
of periodic audits and appraisals of the Eligible Collateral securing
this Agreement, at such intervals as the Bank may reasonably require
but no more frequently than once in any 1 year period following the
date of this Agreement. The audits and appraisals may be performed by
employees of the Bank or by independent appraisers acceptable to the
Bank.
4. COLLATERAL
The Borrower's obligations to the Bank under this Agreement will be
secured by Eligible Collateral consisting of various pieces of fine art the
Borrower now owns or will own in the future and the Borrower's interest under
the Art Lease. The Eligible Collateral is further defined in security
agreement(s) executed by the Borrower, which, as of the date of this Agreement
includes the personal property listed on Exhibit A to this Agreement.
5. DISBURSEMENTS, PAYMENTS AND COSTS
5.1 Requests for Credit; Equal Access by all Borrowers. If two or
more Borrowers sign this Agreement, any Borrower (or a person or persons
authorized in writing by any one of the Borrowers), acting alone, can borrow up
to the full amount of the Commitment. Each Borrower will be liable for all
extensions of credit made under this Agreement to any other Borrower. Each
request for an extension of credit will be made in writing in a manner
acceptable to the Bank, or by another means acceptable to the Bank.
5.2 Disbursements and Payments.
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(a) Each payment by the Borrower will be made at the
Bank's banking center (or other location) selected by the Bank from
time to time; and will be made in immediately available funds, or such
other type of funds selected by the Bank.
(b) Each disbursement by the Bank and each payment by the
Borrower will be evidenced by records kept by the Bank. In addition,
the Bank may, at its discretion, require the Borrower to sign one or
more promissory notes.
5.3 Telephone and Telefax Authorization.
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(a) The Bank may honor telephone or telefax instructions
for advances or repayments or for the designation of optional interest
rates given, or purported to be given, by any one of the individual
signer(s) of this Agreement or a person or persons authorized in
writing by any one of the signer(s) of this Agreement.
(b) Advances will be deposited in such of the Borrower's
accounts with the Bank as designated in writing by the Borrower or as
otherwise designated by Borrower.
(c) The Borrower will indemnify and hold the Bank
harmless from all liability, loss, and costs in connection with any act
resulting from telephone or telefax instructions the Bank reasonably
believes are made by any individual authorized by the Borrower to give
such instructions. This paragraph will survive this Agreement's
termination, and will benefit the Bank and its officers, employees, and
agents.
5.4 Banking Days. Unless otherwise provided in this Agreement, a
banking day is a day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close, or are in fact closed, in Nevada, and,
if such day relates to amounts bearing interest at an offshore rate (if any),
means any such day on which dealings in dollar deposits are conducted among
banks in the offshore dollar interbank market. All payments and disbursements
which would be due on a day which is not a banking day will be due on the next
banking day. All payments received on a day which is not a banking day will be
applied to the credit on the next banking day.
5.5 Taxes.
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(a) If any payments to the Bank under this Agreement are
made from outside the United States, the Borrower will not deduct any
foreign taxes from any payments it makes to the Bank. If any such taxes
are imposed on any payments made by the Borrower (including payments
under this paragraph), the Borrower will pay the taxes and will also
pay to the Bank, at the time interest is paid, any additional amount
which the Bank specifies as necessary to preserve the after-tax yield
the Bank would have received if such taxes had not been imposed. The
Borrower will confirm that it has paid the taxes by giving the Bank
official tax receipts (or notarized copies) within 30 days after the
due date.
(b) Payments made by the Borrower to the Bank will be
made without deduction of United States withholding or similar taxes.
If the Borrower is required to pay U.S. withholding taxes, the Borrower
will pay such taxes in addition to the amounts due to the Bank under
this Agreement. If the Borrower fails to make such tax payments when
due, the Borrower indemnifies the Bank against any liability for such
taxes, as well as for any related interest, expenses, additions to tax,
or penalties asserted against or suffered by the Bank with respect to
such taxes.
5.6 Additional Costs. The Borrower will pay the Bank, on demand,
for the Bank's actual costs or losses arising from any statute or regulation, or
any request or requirement of a regulatory agency which is applicable to all
national banks or a class of all national banks. The costs and losses will be
allocated to the loan in a manner determined by the Bank, using any reasonable
method. The costs include the following:
(a) any reserve or deposit requirements; and
(b) any capital requirements relating to the Bank's
assets and commitments for credit.
5.7 Interest Calculation. Except as otherwise stated in this
Agreement, all interest and fees, if any, will be computed on the basis of a
360-day year and the actual number of days elapsed. This results in more
interest or a higher fee than if a 365-day year is used. Installments of
principal which are not paid when due under this Agreement shall continue to
bear interest until paid.
5.8 Default Rate. Upon the occurrence of any default under this
Agreement, principal amounts outstanding under this Agreement will at the option
of the Bank bear interest at the Bank's Prime Rate plus one (1) percentage
point. This will not constitute a waiver of any default. The Prime Rate is the
rate of interest publicly announced from time to time by the Bank as its Prime
Rate. The Prime Rate is set by the Bank based on various factors, including the
Bank's costs and desired return, general economic conditions and other factors,
and is used as a reference point for pricing some loans. The Bank may price
loans to its customers at, above, or below the Prime Rate. Any change in the
Prime Rate shall take effect at the opening of business on the day specified in
the public announcement of a change in the Bank's Prime Rate.
6. CONDITIONS
The Bank must receive the following items, in form and content
acceptable to the Bank, before it is required to extend any credit to the
Borrower under this Agreement:
6.1 Security Agreements. Signed original security agreements
and assignments which the Bank requires.
6.2 Perfection and Evidence of Priority. Financing statements
(and any collateral in which the Bank requires a possessory security interest),
together with evidence that the security interests and liens in favor of the
Bank are valid, enforceable, and prior to all others' rights and interests,
except those the Bank consents to in writing.
6.3 Insurance. Evidence of insurance coverage, as required in
the "Covenants" section of this Agreement.
6.4 Payment of Fees. Payment of all accrued and unpaid expenses
incurred by the Bank as required by the paragraph entitled "Reimbursement
Costs."
6.5 Form FRU-1. Execution and delivery by the Borrower to the
Bank of Form FRU-1.
6.6 Liquidity. Evidence of the Borrower's unencumbered Liquid
Assets, as hereinafter defined, equal to at least Twenty Million Dollars
($20,000,000).
6.7 Other Required Documentation:
(a) An appraisal of the Eligible Collateral, in form,
substance and performed by appraiser(s) acceptable to Bank in Bank's
discretion. Bank acknowledges that it has received an appraisal dated
October 21, 2002 with respect to certain items of Eligible Collateral,
which is acceptable to Bank as to such items.
(b) Evidence that the Borrower owns the Eligible
Collateral and that the Eligible Collateral is authentic, including
bills of sale, certificates of authenticity or attribution and
provenances.
(c) Evidence that all of the Eligible Collateral is
stored either at [*MATERIAL OMITTED AND SEPARATELY FILED WITH THE
COMMISSION UNDER AN APPLICATION FOR CONFIDENTIAL TREATMENT] or at The
▇▇▇▇ Collection of Fine Art, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ (the "Gallery") and that the mode and manner of storage provides
adequate protection against theft and damage.
6.8 Other Items. Any other items reasonably required by the Bank.
7. REPRESENTATIONS AND WARRANTIES
When the Borrower signs this Agreement, and until the Bank is repaid in
full, the Borrower makes the following representations and warranties. Each
request for an extension of credit constitutes a renewal of these
representations and warranties as of the date of the request:
7.1 Enforceable Agreement. This Agreement is a legal, valid and
binding agreement of the Borrower, enforceable against the Borrower in
accordance with its terms, and any instrument or agreement required hereunder,
when executed and delivered, will be similarly legal, valid, binding and
enforceable.
7.2 No Conflicts. This Agreement does not conflict with any law,
agreement, or obligation by which the Borrower is bound.
7.3 Financial Information. All financial and other information
that has been or will be supplied to the Bank is sufficiently complete to give
the Bank accurate knowledge of the Borrower's financial condition, including all
material contingent liabilities. Since the date of the most recent financial
statement provided to the Bank, there has been no material adverse change in the
business condition (financial or otherwise), operations, properties or prospects
of the Borrower.
7.4 Lawsuits. There is no lawsuit, tax claim or other dispute
pending or threatened against the Borrower which, if lost, would materially
impair the Borrower's financial condition or ability to repay the loan, except
as have been disclosed in writing to the Bank.
7.5 Collateral. Other than the lien created by this Agreement
and the Security Agreement, all collateral required in this Agreement is owned
by the Borrower free of any title defects or any liens or interests of others,
except that the Eligible Collateral is subject to the Art Lease.
7.6 Permits, Franchises. The Borrower possesses all permits,
memberships, franchises, contracts and licenses required and all trademark
rights, trade name rights, patent rights and fictitious name rights necessary to
enable it to conduct the business in which it is now engaged.
7.7 Other Obligations. The Borrower is not in default on any
obligation for borrowed money, any purchase money obligation or any other
material lease, commitment, contract, instrument or obligation that would
materially impair the Borrower's financial condition or ability to repay the
advances under this Agreement.
7.8 Income Tax Matters. The Borrower has no knowledge of any
pending assessments or adjustments of its income tax for any year.
7.9 No Event of Default. There is no event which is, or with
notice or lapse of time or both would be, a default under this Agreement.
7.10 Insurance. The Borrower has obtained, and maintained in
effect, the insurance coverage required in the "Covenants" section of this
Agreement.
7.11 Location of Borrower. The Borrower is located at [*MATERIAL
OMITTED AND SEPARATELY FILED WITH THE COMMISSION UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT]. For the purposes of this paragraph, the Borrower's
location [*MATERIAL OMITTED AND SEPARATELY FILED WITH THE COMMISSION UNDER AN
APPLICATION FOR CONFIDENTIAL TREATMENT].
7.12 Use of Eligible Collateral. The Borrower has used and intends
to use the Eligible Collateral primarily for business purposes, and in
particular holds such Eligible Collateral primarily for public display, or for
sale or lease.
7.13 Location of Eligible Collateral. The Eligible Collateral is
entirely located and stored at [*MATERIAL OMITTED AND SEPARATELY FILED WITH THE
COMMISSION UNDER AN APPLICATION FOR CONFIDENTIAL TREATMENT] or at the Gallery,
or such other location that the Bank, in its reasonable discretion, approves
from time to time.
7.14 Security and Storage. The Eligible Collateral is stored and
secured so as to limit, to the extent reasonably possible in light of the value
of the Eligible Collateral, the risk of damage from the elements, theft and
damage from fire or other casualty.
7.15 Date Eligible Collateral Created. No piece of the Eligible
Collateral was created after June 1, 1991.
8. COVENANTS
The Borrower agrees, so long as credit is available under this
Agreement and until the Bank is repaid in full:
8.1 Use of Proceeds. To use the proceeds of the credit only for
acquisition of shares of Wynn Resorts, Limited in a public offering and for
working capital purposes only.
8.2 Financial Information. To provide the following financial
information and statements in form and content acceptable to the Bank, and such
additional information as requested by the Bank from time to time:
(a) By no later than sixty (60) days of each calendar
year, the Borrower's annual financial statements. These financial
statements must be prepared in accordance with generally accepted
accounting principals.
(b) Copies of the Borrower's most recent federal income
tax return (with all forms K-1 attached), within 30 days of filing,
together with a statement of any contributions made by the Borrower to
any subchapter S corporation or trust, and, if requested by the Bank,
copies of any extensions of the filing date.
(c) Within 10 days after each calendar quarter, a
compliance certificate signed by the Borrower setting forth (i) the
information and computations (in sufficient detail) to establish that
the Borrower is in compliance with all financial covenants at the end
of each calendar quarter and (ii) whether there existed as of the date
of such compliance certificate and whether there exists as of the date
of the certificate, any default under this Agreement and, if any such
default exists, specifying the nature thereof and the action the
Borrower is taking and proposes to take with respect thereto.
(d) Promptly upon request, such additional information
regarding the Borrower, any guarantor or any other obligor as the Bank
may request from time to time.
8.3 To maintain unencumbered Liquid Assets equal to at least
Twenty Million Dollars ($20,000,000).
"Liquid Assets" means the following assets of the Borrower (excluding
assets of any retirement plan established pursuant to the provisions of Sections
401(a) and 501(a) of the Internal Revenue Code, any individual retirement
account or annuity, simplified employee pension plan or SIMPLE plan established
pursuant to the provisions of Section 408 of the Internal Revenue Code, or any
other retirement plan or arrangement established pursuant to any other federal
or state statute) which may be converted to cash by sale or other means within
five (5) days:
(a) Cash;
(b) Demand deposits or interest-bearing time and
eurodollar deposits, certificates of deposit or similar banking
arrangements held in the United States where either (i) such deposits
or other arrangements are held with banks or other financial
institutions which have capital and surplus of not less than One
Hundred Million Dollars ($100,000,000) or (ii) such deposits are fully
FDIC-insured;
(c) Direct obligations of the United States of America
in the form of United States Treasury obligations or any governmental
agency or instrumentality whose obligations constitute full faith and
credit obligations of the United States of America and which are
regularly traded on a public market or exchange;
(d) Commercial paper rated P-1 by ▇▇▇▇▇'▇ Investors
Services, Inc. or A-1 by Standard & Poor's Corporation, a division of
McGraw Hill, Inc.;
(e) Bonds and other fixed income instruments (including
tax-exempt bonds) from companies or public entities rated investment
grade by one of the rating agencies described in (d), and mutual funds
that invest substantially all of their assets in such bonds and other
fixed income instruments, either owned directly or managed by (i) any
nationally recognized investment advisor or (ii) any investment advisor
which has assets under management in excess of Two Hundred Fifty
Million Dollars ($250,000,000);
(f) Eligible Stocks, either (a) owned directly by the
Borrower or (b) managed by (i) any nationally recognized investment
advisor or (ii) any investment advisor which has assets under
management in excess of Two Hundred Fifty Million Dollars
($250,000,000); and
(g) Mutual funds or money market funds that invest
substantially all of their assets in instruments described above in
(a), (b), (c), (d), (e) and/or (f) of this section and which are quoted
in either the Wall Street Journal or ▇▇▇▇▇▇'▇.
Within 10 days of the end of each calendar quarter, the Borrower shall
provide to the Bank copies of statements from depository institutions or
brokerage firms, or other evidence acceptable to the Bank of the Borrower's
Liquid Assets; together with a compliance certificate substantially in the form
of Exhibit B, in form and content satisfactory to the Bank, and certified in
writing as true and correct.
"Eligible Stocks" shall include any common or preferred stock which is
traded on a U.S. national stock exchange or included in the National Market tier
of NASDAQ and which (i) is issued by a company with a market capitalization, as
of the close of the most recent trading day, of at least One Billion Dollars
($1,000,000,000), (ii) has, as of the close of the most recent trading day, a
per share price of at least Fifteen Dollars ($15), and (iii) is not subject to
any restriction or limitation by applicable laws or agreements governing the
sale, transfer or other disposition thereof in the public market.
8.4 Location of Collateral. To provide the Bank within ten days of
the end of each calendar quarter an inventory of the Eligible Collateral
subject to this Agreement and its location(s).
8.5 Other Debts. To promptly notify Bank in writing at any time,
and from time to time, Borrower has outstanding debt or incurs any direct or
contingent liabilities (other than those to the Bank under this Agreement), or
becomes liable for the liabilities of others, in the aggregate in excess of
Fifty Million Dollars ($50,000,000).
8.6 Notices to Bank. To promptly notify the Bank in writing of:
(a) any lawsuit over One Million Dollars ($1,000,000)
against the Borrower or any of the Borrower's property.
(b) any substantial dispute between the Borrower and
any government authority, or which may affect the Borrower's property.
(c) any event of default under this Agreement, or any
event which, with notice or lapse of time or both, would constitute
an event of default.
(d) any material adverse change in the Borrower's (or
any guarantor's) business condition (financial or otherwise),
operations, properties or prospects, or ability to repay the credit.
(e) any change in the Borrower's name or address.
(f) any actual contingent liabilities of the Borrower
(or any guarantor), and any such contingent liabilities which are
reasonably foreseeable.
8.7 Inspections and Appraisals. To allow the Bank and its agents
to inspect and appraise any of the Eligible Collateral securing this Agreement
and examine, audit and make copies of books and records concerning the Eligible
Collateral at any reasonable time. If any of the Eligible Collateral, books or
records are in the possession of a third party, the Borrower authorizes that
third party to permit the Bank or its agents to have access to perform
inspections, appraisals or audits. Without limiting the foregoing, the Borrower,
at Borrower's expense shall cause the Eligible Collateral subject to the
Agreement to be re-appraised pursuant to the provisions of Section 3.3(b).
8.8 Compliance with Laws. To comply with the laws, regulations,
and orders of any government body with authority over the Borrower's business.
8.9 Perfection of Liens. To help the Bank perfect and protect its
security interests and liens, and reimburse it for related costs it incurs to
protect its security interests and liens.
8.10 Cooperation. To take any action reasonably requested by the
Bank to carry out the intent of this Agreement.
8.11 Insurance.
(a) Insurance Covering Collateral. To maintain a fine
art insurance policy for the Eligible Collateral for no less than one
hundred thirty percent (130%) of the Commitment with an insurer
acceptable to the Bank, and with the Bank named a "mortgagee".
(b) General Business Insurance. To maintain or cause
to be maintained insurance satisfactory to the Bank as to amount,
nature and carrier covering property damage (including loss of use and
occupancy).
(c) Evidence of Insurance. Upon the request of the Bank,
to deliver to the Bank a copy of each insurance policy, or, if
permitted by the Bank, a certificate of insurance listing all insurance
in force.
8.12 Additional Negative Covenants. Not to, without the Bank's
written consent:
(a) change the Borrower's primary use of the Eligible
Collateral from the primary use specified in paragraph 7.12 above.
(b) move or transport the Eligible Collateral from the
location specified in paragraph 7.13 above, including exhibition of the
Eligible Collateral and the release of the Eligible Collateral on
consignment.
8.13 No Consumer Purpose. Not to use this loan for family, or
household purposes. The Bank may provide the Borrower (or any guarantor) with
certain disclosures intended for loans made for family, or household purposes.
The fact that the Bank elects to make such disclosures shall not be deemed a
determination by the Bank that the loan will be used for such purposes.
8.14 Bank as Principal Depository. To maintain the Bank as its
principal depository bank, including for the maintenance of business, cash
management, operating and administrative deposit accounts.
8.15 Delivery of Possession. If legally necessary in order to
perfect and maintain the Bank's first-priority lien and security interest, the
Borrower will, after request by the Bank, assemble and deliver possession of the
Eligible Collateral to the Bank in such manner as the Bank shall require.
8.16 Removal of Collateral from Art Lease. Upon the occurrence of
any default under this Agreement or the Security Agreement, upon written request
of the Bank the Borrower shall immediately terminate the Art Lease with respect
to all Eligible Collateral by withdrawal of such Eligible Collateral from the
Art Lease pursuant to Paragraph 6 thereof and further shall immediately deliver
such Eligible Collateral to the Bank.
8.17 Maintenance of Collateral Value. At all times during the term
of this Agreement the value of the Eligible Collateral, as established by
appraisals reasonably acceptable to the Bank, shall be at least equal to
$277,777,777. In the event the Borrower provides replacement or additional
collateral in order to satisfy the foregoing requirements, such collateral must
be acceptable to the Bank, in its discretion and the Borrower shall provide the
Bank with such appraisals, certificates of provenance and ownership and other
information as the Bank may reasonably require. In the event of any addition or
substitution of collateral hereunder the Borrower shall enter into such
amendments of this Agreement, the Security Agreement and any financing
statements as may be necessary in order to evidence and perfect the Bank's
security interest in such collateral.
8.18 Sale of Eligible Collateral. Notify the Bank within five (5)
days after the sale or transfer of any Eligible Collateral.
9. DEFAULT
If any of the following events occurs, the Bank may do one or more of
the following: declare the Borrower in default, stop making any additional
credit available to the Borrower, and require the Borrower to repay its entire
debt immediately and without prior notice. If an event of default occurs under
the paragraph entitled "Bankruptcy," below, with respect to the Borrower, then
the entire debt outstanding under this Agreement will automatically be due
immediately.
9.1 Failure to Pay. The Borrower fails to make a payment under
this Agreement within 10 days after the date when due.
9.2 Lien Priority. The Bank fails to have an enforceable first
lien (except for any prior liens to which the Bank has consented in writing) on
or security interest in any property given as security for this Agreement (or
any guaranty).
9.3 False Information. The Borrower has given the Bank false or
misleading information or representations.
9.4 Death. The Borrower dies or becomes legally incompetent.
9.5 Bankruptcy. The Borrower files a bankruptcy petition, a
bankruptcy petition is filed against the Borrower or the Borrower makes a
general assignment for the benefit of creditors. The default will be deemed
cured if any bankruptcy petition filed against the Borrower is dismissed within
a period of 45 days after the filing; provided, however, that the Bank will not
be obligated to extend any additional credit to the Borrower during that period;
and provided further that such cure opportunity will be terminated upon the
entry of an order for relief in any bankruptcy case arising from such a
petition.
9.6 Receivers. A receiver or similar official is appointed for
a substantial portion of the Borrower's assets.
9.7 Judgments. Any judgments or arbitration awards are entered
against the Borrower or the Borrower enters into any settlement agreements with
respect to any litigation or arbitration, in an aggregate amount of Five Million
Dollars ($5,000,000) or more.
9.8 Government Action. Any government authority takes action that
the Bank believes materially adversely affects the Borrower's financial
condition or ability to repay.
9.9 Material Adverse Change. A material adverse change occurs, or
is reasonably likely to occur, in the Borrower's financial condition,
operations, properties or prospects, or ability to repay the credit; or the Bank
determines that it is insecure for any other reason.
9.10 Cross-default. Any default occurs under any agreement in
connection with any credit in excess of One Million Dollars ($1,000,000) the
Borrower has obtained from anyone else or which the Borrower has guaranteed if
the default consists of failing to make a payment when due and the other lender
accelerates the obligation.
9.11 Default under Related Documents. Any default occurs under
any guaranty, subordination agreement, security agreement, deed of trust,
mortgage, or other document required by or delivered in connection with this
Agreement or any such document is no longer in effect, or any guarantor purports
to revoke or disavow the guaranty.
9.12 Other Bank Agreements. The Borrower fails to meet the
conditions of, or fails to perform any obligation under any other agreement the
Borrower has with the Bank or any affiliate of the Bank. If, in the Bank's
opinion, the breach is capable of being remedied, the breach will not be
considered an event of default under this Agreement for a period of thirty (30)
days after the date on which the Bank gives written notice of the breach to the
Borrower; provided, however, that the Bank will not be obligated to extend any
additional credit to the Borrower during that period.
9.13 Use of Proceeds. The Borrower does not utilize or invest the
proceeds of any extension of credit made under this Agreement for the purposes
described by the Borrower to the Bank.
9.14 Other Breach Under Agreement. The Borrower fails to meet the
conditions of, or fails to perform any obligation under, any term of this
Agreement not specifically referred to in this Article. This includes any
failure or anticipated failure by the Borrower to comply with any financial
covenants set forth in this Agreement, whether such failure is evidenced by
financial statements delivered to the Bank or is otherwise known to the Borrower
or the Bank. If, in the Bank's opinion, the breach is capable of being remedied,
the breach will not be considered an event of default under this Agreement for a
period of thirty (30) days after the date on which the Bank gives written notice
of the breach to the Borrower; provided, however, that the Bank will not be
obligated to extend any additional credit to the Borrower during that period.
10. ENFORCING THIS AGREEMENT; MISCELLANEOUS
10.1 Financial Computations. Except as otherwise stated in this
Agreement, all financial information provided to the Bank and all financial
covenants will be made in accordance with accounting principles applied
consistently with those applied in the preparation of the Borrower's financial
statements dated May 28, 2003; provided, however, that assets may be listed at
market value on the condition that deferred income taxes on any unrealized gain
are shown as a liability. The calculation of the Borrower's assets shall exclude
goodwill and other intangibles.
10.2 Nevada Law. This Agreement is governed by Nevada law.
10.3 Successors and Assigns. This Agreement is binding on the
Borrower's and the Bank's successors and assignees. The Borrower agrees that it
may not assign this Agreement without the Bank's prior consent. The Bank may
sell participations in or assign this loan, and may exchange financial
information about the Borrower with actual or potential participants or
assignees; provided, however, the Bank shall consult with the Borrower prior to
any such participation or assignment.
10.4 ARBITRATION AND WAIVER OF JURY TRIAL.
(A) THIS PARAGRAPH CONCERNS THE RESOLUTION OF ANY
CONTROVERSIES OR CLAIMS BETWEEN THE BORROWER AND THE BANK, WHETHER
ARISING IN CONTRACT, TORT OR BY STATUTE, INCLUDING BUT NOT LIMITED TO
CONTROVERSIES OR CLAIMS THAT ARISE OUT OF OR RELATE TO: (I) THIS
AGREEMENT (INCLUDING ANY RENEWALS, EXTENSIONS OR MODIFICATIONS); OR
(II) ANY DOCUMENT RELATED TO THIS AGREEMENT (COLLECTIVELY A "CLAIM").
(B) AT THE REQUEST OF THE BORROWER OR THE BANK, ANY CLAIM
SHALL BE RESOLVED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL
ARBITRATION ACT (TITLE 9, U. S. CODE) (THE "ACT"). THE ACT WILL APPLY
EVEN THOUGH THIS AGREEMENT PROVIDES THAT IT IS GOVERNED BY THE LAW OF A
SPECIFIED STATE.
(C) ARBITRATION PROCEEDINGS WILL BE DETERMINED IN ACCORDANCE
WITH THE ACT, THE RULES AND PROCEDURES FOR THE ARBITRATION OF FINANCIAL
SERVICES DISPUTES OF JAMS/ENDISPUTE, LLC, A DELAWARE LIMITED LIABILITY
COMPANY OR ANY SUCCESSOR THEREOF ("JAMS"), AND THE TERMS OF THIS
PARAGRAPH. IN THE EVENT OF ANY INCONSISTENCY, THE TERMS OF THIS
PARAGRAPH SHALL CONTROL.
(D) THE ARBITRATION SHALL BE ADMINISTERED BY JAMS AND
CONDUCTED IN ANY U. S. STATE WHERE REAL OR TANGIBLE PERSONAL PROPERTY
COLLATERAL FOR THIS CREDIT IS LOCATED OR IF THERE IS NO SUCH
COLLATERAL, IN NEVADA. ALL CLAIMS SHALL BE DETERMINED BY ONE
ARBITRATOR; HOWEVER, IF CLAIMS EXCEED FIVE MILLION DOLLARS
($5,000,000), UPON THE REQUEST OF ANY PARTY, THE CLAIMS SHALL BE
DECIDED BY THREE ARBITRATORS. ALL ARBITRATION HEARINGS SHALL COMMENCE
WITHIN NINETY (90) DAYS OF THE DEMAND FOR ARBITRATION AND CLOSE WITHIN
NINETY (90) DAYS OF COMMENCEMENT AND THE AWARD OF THE ARBITRATOR(S)
SHALL BE ISSUED WITHIN THIRTY (30) DAYS OF THE CLOSE OF THE HEARING.
HOWEVER, THE ARBITRATOR(S), UPON A SHOWING OF GOOD CAUSE, MAY EXTEND
THE COMMENCEMENT OF THE HEARING FOR UP TO AN ADDITIONAL SIXTY (60)
DAYS. THE ARBITRATOR(S) SHALL PROVIDE A CONCISE WRITTEN STATEMENT OF
REASONS FOR THE AWARD. THE ARBITRATION AWARD MAY BE SUBMITTED TO ANY
COURT HAVING JURISDICTION TO BE CONFIRMED AND ENFORCED.
(E) THE ARBITRATOR(S) WILL HAVE THE AUTHORITY TO DECIDE
WHETHER ANY CLAIM IS BARRED BY THE STATUTE OF LIMITATIONS AND, IF SO,
TO DISMISS THE ARBITRATION ON THAT BASIS. FOR PURPOSES OF THE
APPLICATION OF THE STATUTE OF LIMITATIONS, THE SERVICE ON JAMS UNDER
APPLICABLE JAMS RULES OF A NOTICE OF CLAIM IS THE EQUIVALENT OF THE
FILING OF A LAWSUIT. ANY DISPUTE CONCERNING THIS ARBITRATION PROVISION
OR WHETHER A CLAIM IS ARBITRABLE SHALL BE DETERMINED BY THE
ARBITRATOR(S). THE ARBITRATOR(S) SHALL HAVE THE POWER TO AWARD LEGAL
FEES PURSUANT TO THE TERMS OF THIS AGREEMENT.
(F) THIS PARAGRAPH DOES NOT LIMIT THE RIGHT OF THE BORROWER OR
THE BANK TO: (I) EXERCISE SELF-HELP REMEDIES, SUCH AS BUT NOT LIMITED
TO, SETOFF; (II) INITIATE JUDICIAL OR NONJUDICIAL FORECLOSURE AGAINST
ANY REAL OR PERSONAL PROPERTY COLLATERAL; (III) EXERCISE ANY JUDICIAL
OR POWER OF SALE RIGHTS, OR (IV) ACT IN A COURT OF LAW TO OBTAIN AN
INTERIM REMEDY, SUCH AS BUT NOT LIMITED TO, INJUNCTIVE RELIEF, WRIT OF
POSSESSION OR APPOINTMENT OF A RECEIVER, OR ADDITIONAL OR SUPPLEMENTARY
REMEDIES.
(G) THE FILING OF A COURT ACTION IS NOT INTENDED TO CONSTITUTE
A WAIVER OF THE RIGHT OF THE BORROWER OR THE BANK, INCLUDING THE SUING
PARTY, THEREAFTER TO REQUIRE SUBMITTAL OF THE CLAIM TO ARBITRATION.
(H) BY AGREEING TO BINDING ARBITRATION, THE PARTIES
IRREVOCABLY AND VOLUNTARILY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY CLAIM. FURTHERMORE, WITHOUT INTENDING IN ANY WAY
TO LIMIT THIS AGREEMENT TO ARBITRATE, TO THE EXTENT ANY CLAIM IS NOT
ARBITRATED, THE PARTIES IRREVOCABLY AND VOLUNTARILY WAIVE ANY RIGHT
THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF SUCH CLAIM. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES ENTERING INTO THIS
AGREEMENT.
10.5 Severability; Waivers. If any part of this Agreement is not
enforceable, the rest of the Agreement may be enforced. The Bank retains all
rights, even if it makes a loan after default. If the Bank waives a default, it
may enforce a later default. Any consent or waiver under this Agreement must be
in writing.
10.6 Administration Costs. The Borrower shall pay the Bank for
all reasonable costs incurred by the Bank in connection with administering this
Agreement.
10.7 Attorneys' Fees. The Borrower shall reimburse the Bank for
any reasonable costs and attorneys' fees incurred by the Bank in connection with
the enforcement or preservation of any rights or remedies under this Agreement
and any other documents executed in connection with this Agreement, and in
connection with any amendment, waiver, "workout" or restructuring under this
Agreement. In the event of a lawsuit or arbitration proceeding, the prevailing
party is entitled to recover costs and reasonable attorneys' fees incurred in
connection with the lawsuit or arbitration proceeding, as determined by the
court or arbitrator. In the event that any case is commenced by or against the
Borrower under the Bankruptcy Code (Title 11, United States Code) or any similar
or successor statute, the Bank is entitled to recover costs and reasonable
attorneys' fees incurred by the Bank related to the preservation, protection, or
enforcement of any rights of the Bank in such a case. As used in this paragraph,
"attorneys' fees" includes the allocated costs of the Bank's in-house counsel.
10.8 Multiple Borrowers. If two or more borrowers sign this
Agreement, each will be jointly and severally obligated to repay the Bank in
full.
10.9 One Agreement. This Agreement and any related security or
other agreements required by this Agreement, collectively:
(a) represent the sum of the understandings and
agreements between the Bank and the Borrower concerning this credit;
(b) replace any prior oral or written agreements between
the Bank and the Borrower concerning this credit; and
(c) are intended by the Bank and the Borrower as the
final, complete and exclusive statement of the terms agreed to by them.
In the event of any conflict between this Agreement and any other agreements
required by this Agreement, this Agreement will prevail.
10.10 Indemnification. The Borrower will indemnify and hold the
Bank harmless from any loss, liability, damages, judgments, and costs
("Damages") of any kind relating to or arising directly or indirectly out of (a)
this Agreement or any document required hereunder, (b) any credit extended or
committed by the Bank to the Borrower hereunder, and (c) any litigation or
proceeding related to or arising out of this Agreement, any such document, or
any such credit, other than Damages that are a result of the gross negligence or
willful misconduct of the Bank or its directors, officers, employees, agents,
successors, attorneys and assigns. This indemnity includes but is not limited to
attorneys' fees (including the allocated cost of in-house counsel). This
indemnity extends to the Bank, its parent, subsidiaries and all of their
directors, officers, employees, agents, successors, attorneys, and assigns. This
indemnity will survive repayment of the Borrower's obligations to the Bank. All
sums due to the Bank hereunder shall be obligations of the Borrower, due and
payable immediately without demand.
10.11 Notices. Unless otherwise provided in this Agreement or in
another agreement between the Bank and the Borrower, all notices required under
this Agreement shall be personally delivered or sent by first class mail,
postage prepaid, or by overnight courier, to the addresses on the signature page
of this Agreement, or sent by facsimile to the fax numbers listed on the
signature page, or to such other addresses as the Bank and the Borrower may
specify from time to time in writing. Notices and other communications sent by
(a) first class mail shall be deemed delivered on the earlier of actual receipt
or on the fourth business day after deposit in the U.S. mail, postage prepaid,
(b) overnight courier shall be deemed delivered on the next business day, and
(c) telecopy shall be deemed delivered when transmitted.
10.12 Headings. Article and paragraph headings are for reference
only and shall not affect the interpretation or meaning of any provisions of
this Agreement.
10.13 Counterparts. This Agreement may be executed in as many
counterparts as necessary or convenient, and by the different parties on
separate counterparts each of which, when so executed, shall be deemed an
original but all such counterparts shall constitute but one and the same
agreement.
This Agreement is executed as of the date stated at the top of the
first page.
Bank of America, N.A.
By /s/ ▇▇▇▇▇ ▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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Typed Name ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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Title Sr. Vice President
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/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
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Address where notices to Address where notices to
the Bank are to be sent: the Borrower are to be sent:
Private Bank [*MATERIAL OMITTED AND
NV1-119-03-01 SEPARATELY FILED WITH THE
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Suite 300 FOR CONFIDENTIAL TREATMENT]
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