AMENDED AND RESTATED MANAGEMENT FEES SUBORDINATION AGREEMENT
EXHIBIT
10.7
AMENDED
AND RESTATED MANAGEMENT FEES SUBORDINATION AGREEMENT
THIS
AMENDED AND RESTATED MANAGEMENT FEES SUBORDINATION AGREEMENT (this “Agreement”) dated as
of October 29, 2009, is made and entered into by and among THE OLD ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, L.L.C., a Louisiana limited liability company (“OED”), ▇▇▇▇▇▇▇ ▇▇
WORTH, LLC, a Delaware limited liability company (“DJW”; together with
OED, hereinafter collectively referred to as the “Debtors” and each
individually, a “Debtor”), ▇▇▇▇▇▇▇ ▇▇,
LLC, a Delaware limited liability company (“DJO”), PENINSULA
GAMING PARTNERS, LLC, a Delaware limited liability company (“PGP”), OED
ACQUISITION, LLC, a Delaware limited liability company (“OEDA”; together with
DJO and PGP, hereinafter collectively referred to as the “Subordinated Parties”
and each individually, a “Subordinated Party”),
and ▇▇▇▇▇ FARGO FOOTHILL, INC., a California corporation, as agent for the
Lenders (as defined in the Senior Loan Agreement defined below) (the “Agent”).
W I T N E S S E T
H:
WHEREAS,
the parties hereto executed and delivered that certain Management Fees
Subordination Agreement dated as of June 16, 2004 (as amended, restated,
supplemented or otherwise modified prior to the date hereof, the “Existing Management Fees
Subordination Agreement”) and desire to amend and restate the Existing
Management Fees Subordination Agreement as provided herein; and
WHEREAS,
the parties hereto intend that (a) the provisions of the Existing Management
Fees Subordination Agreement be hereby superseded and replaced by the provisions
hereof, and (b) by entering into and performing their respective obligations
hereunder, this transaction shall not constitute a novation; and
WHEREAS,
OED is indebted and may from time to time in the future become indebted to a
Subordinated Party in respect of certain amounts owing to the Subordinated
Parties pursuant to that certain Amended and Restated Management Services
Agreement (as amended, restated, supplemented or otherwise modified from time to
time, the “OED
Management Agreement”), by and among OED, OEDA and DJO, dated as of
February 25, 2003; and
WHEREAS,
DJW is indebted and may from time to time in the future become indebted to a
Subordinated Party in respect of certain amounts owing to the Subordinated
Parties pursuant to that certain Management Services Agreement (as amended,
restated, supplemented or otherwise modified from time to time, the “DJW Management
Agreement”; together with the OED Management Agreement, hereinafter
collectively refereed to as the “Management
Agreements” and each individually, a “Management
Agreement”) by and among DJW and PGP, dated as of July 19, 2005 (such
amounts, together with all other obligations of the Debtors, or either of them,
to each Subordinated Party arising under the Management Agreements, however
evidenced and whether now existing or hereafter arising, are referred to herein
as the “Subordinated
Fees”); and
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WHEREAS,
DJO, OED, DJW and Peninsula Gaming, LLC, a Delaware limited liability company
(“PGL”;
together with DJO, OED and DJW, hereinafter collectively referred to as the
“Borrowers” and
each individually, a “Borrower”), the Agent
and the Lenders are parties to that certain Amended and Restated Loan and
Security Agreement dated as of even date herewith (collectively, as amended,
restated, supplemented or otherwise modified from time to time, the “Senior Loan
Agreement”), whereby the Borrowers may be indebted to the Lender Group
(as defined in the Senior Loan Agreement) for certain extensions of credit
outstanding from time to time (all such indebtedness, including, without
limitation, principal, interest, fees, costs, expenses and other sums chargeable
to the Borrowers by the Agent or the other members of the Lender Group
(including interest, fees, costs and expenses accruing after an Insolvency
Proceeding (as hereafter defined) commences regardless of whether such interest,
fees, costs and expenses are deemed allowed or recoverable in any Insolvency
Proceeding (as hereinafter defined), and the Guaranteed Obligations (as defined
below), together with any modification, amendment, refinancing or supplement
thereto, and any other obligations of the Debtors to the Agent or the other
members of the Lender Group are hereinafter referred to as the “Senior Debt”);
and
WHEREAS,
as security for the payment of all liabilities and obligations due under the
Senior Debt, the Debtors, pursuant to the Loan Documents (as defined in the
Senior Loan Agreement), have granted to the Agent, for the benefit of the Lender
Group, a first priority lien on and unconditional security interest in and to
certain personal and real property assets of the Debtors as set forth in the
Loan Documents (collectively, said interests in and assets of the Debtors are
referred to herein as the “Collateral”; and,
collectively said liens and security interests of the Agent are referred to
herein as the “Senior
Lien”); and
WHEREAS,
as part of the consideration for the Lender Group’s extension of credit to the
Borrowers, each Subordinated Party has agreed, among other things, subject to
the terms and provisions of this Agreement, (i) to subordinate the Subordinated
Fees to the Senior Debt, (ii) to subordinate any lien which each Subordinated
Party has or may have in the future in the assets or property of any Debtor or
any Subsidiary or Affiliate of the Debtors (the “Subordinated Lien”)
to the Senior Lien, and (iii) to forebear from exercising any creditor’s remedy
or taking any action against the Debtors upon any of their obligations to each
Subordinated Party.
NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
that each capitalized term used herein and not defined herein shall have the
meaning ascribed thereto in the Senior Loan Agreement, and further agree that
the Existing Management Fees Subordination Agreement is amended and restated in
its entirety pursuant to the terms hereof, and further agree as
follows:
1. Priority of Liens;
Subordinated Fees. Notwithstanding anything to the contrary,
including, without limitation, the date, time, manner or order of perfection or
attachment of the security interests and liens on the Collateral granted by the
Debtors to the Agent or any Subordinated Party, and notwithstanding the usual
application of the priority provisions of the Uniform Commercial Code as in
effect in any jurisdiction or any other applicable law or judicial decision of
any jurisdiction, or whether such Subordinated Party holds possession of all or
any
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part of the Collateral, or if the Agent or such Subordinated Party
is perfected without filing or possession in any part of the Collateral, the
Senior Lien shall be a first, senior and prior security interest in and lien on
the Collateral, prior in interest and superior to any Subordinated Lien. The
priority of liens set forth in the previous sentence states the relative
priority of liens of the parties to this Agreement, and no party hereto
represents or warrants to any other party that such other party’s liens are
prior to any lien on the Collateral of any person who is not a party to this
Agreement (except that each Debtor represents and warrants to the Agent that the
Senior Lien has been granted in accordance with the terms and provisions of the
Senior Loan Agreement and other Loan Documents). Each Subordinated
Party agrees that if at any time such Subordinated Party shall be in possession
of any assets or properties of the Debtors, then such Subordinated Party shall
hold such assets or properties in trust for the Agent for the benefit of the
Lender Group, so long as any Senior Debt remains outstanding and until all
obligations of the Lenders to make loans and other financial accommodations to
the Borrowers pursuant to the Senior Loan Agreement (the “Commitments”) are
terminated. Each Subordinated Party represents that, as of the date
hereof, it does not have a lien on or security interest in any assets of any
Debtor, and agrees that it will not take any such lien or security interest
without the prior written consent of the Agent. Nothing in this
Agreement shall be deemed a consent by the Agent to any such Subordinated
Lien.
2. Subordination of
Subordinated Fees.
(a) Each
Subordinated Party hereby subordinates any and all claims now or hereafter owing
to it by the Debtors, or either of them, under all or any portion of the
Subordinated Fees to any and all Senior Debt (including, without limitation,
interest, fees, costs or other payments on the Senior Debt paid or accrued after
the commencement of an Insolvency Proceeding and whether or not such claims are
deemed allowed or recoverable in any Insolvency Proceeding, and payment of or
for adequate protection pursuant to any Insolvency Proceeding), and agrees,
except as provided in Section 2(b) hereof,
that all Senior Debt shall be paid in full in cash to the satisfaction of the
Lender Group and the Commitments shall be terminated before any payment may be
made on the Subordinated Fees.
(b) Except
as set forth below in this paragraph (b), each Subordinated Party agrees not to
accept any payment of the Subordinated Fees nor make any transfer to third
parties not party to this Agreement, or take any other action, designed to
secure directly or indirectly from any Debtor or any other Person any payment on
account of the Subordinated Fees, without the express, prior written consent of
the Agent, and, except as set forth below in this paragraph (b), each
Subordinated Party agrees that any funds that may be received by it as a payment
on account of the Subordinated Fees at any time prior to the termination of this
Agreement shall be held in trust for the benefit of, and shall be immediately
paid over and delivered to, the Agent. Notwithstanding anything
contained herein to the contrary, (i) any Debtor may reimburse Subordinated
Parties for “Reimbursables” (as defined in the Management Agreements) at any
time in accordance with the terms of the Management Agreements, provided no
Event of Default (as that term is defined in the Indenture) then exists or would
be caused thereby, and (ii) on the date that payment of any fees or other sums
(other than Reimbursables) are owing to Subordinated Parties under the
Management Agreements, any Debtor may pay and each Subordinated
Party may receive payments of, all other Subordinated Fees payable on such date
provided no Event of Default then exists or would be caused
thereby.
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(c) Each
Subordinated Party agrees that the priority of the Senior Debt set forth above
shall continue during any insolvency, receivership, bankruptcy, dissolution,
liquidation, or reorganization proceeding, or in any other proceeding, whether
voluntary or involuntary, by or against the Debtors, or either of them, under
any bankruptcy or insolvency law or laws, federal or state relating to the
relief of debtors of any jurisdiction, whether now or hereafter in effect, and
in any out-of-court composition, assignment for the benefit of creditors,
readjustment of indebtedness, reorganization, extension or other debt
arrangement of any kind (collectively, an “Insolvency
Proceeding”). In the event of any payment, distribution,
division or application, partial or complete, voluntary or involuntary, by
operation of law or otherwise, of all or any part of the property, assets or
business of the Debtors, or the proceeds thereof, or any securities of the
Debtors, to any Subordinated Party, by reason of any liquidation, dissolution or
other winding up of any Debtor or its business or by reason of any sale or
Insolvency Proceeding, then any such payment or distribution of any kind or
character, whether in cash, property or securities, that, but for the
subordination provisions of this Section 2, would
otherwise be payable or deliverable upon or in respect of the Subordinated Fees,
shall instead be paid over or delivered directly to the Agent to be applied as
payment of the Senior Debt, to the extent necessary to repay the Senior Debt
remaining unpaid after giving effect to any concurrent payment or distribution
to the Agent.
(d) Subject
to the provisions of this Agreement, the Agent shall have the sole right to
control all aspects of liquidation of the Collateral and disposition of the
proceeds thereof, including all proceedings pertaining thereto under any
Insolvency Proceeding and the approval of any plan of reorganization of the
Debtors, or either of them, thereunder.
3. Forbearance from Exercise of
Certain Remedies. Until the Senior Debt has been paid in full
in cash and the Commitments have been terminated, no Subordinated Party shall
(a) take any action or exercise any remedy against the Debtors, or either of
them, to enforce all or any portion of the Subordinated Fees; (b) take any
action or exercise any remedy against any guarantor of or pledgor securing the
Senior Debt in order to collect any of the Subordinated Fees; (c) commence, or
join with any other creditor of the Debtors, or either of them, in commencing
any Insolvency Proceeding against the Debtors, or either of them; or (d) take
any action or exercise any remedy against any property or assets of any
guarantor of or pledgor securing the Senior Debt or acquire or take any lien on
or security interest in any of the Collateral. The parties hereto
understand and agree that the Agent shall have the right, but shall have no
obligation, to cure any default with respect to the Subordinated Fees without
the prior written consent of each Subordinated Party. Notwithstanding
anything contained in this Agreement to the contrary, in no event shall any
Subordinated Party be entitled to receive and retain any securities, equity or
otherwise, or other consideration provided for in (i) a plan of reorganization
or otherwise in connection with any bankruptcy or Insolvency Proceeding or (ii)
any other judicial or nonjudicial proceeding for the liquidation, dissolution or
winding up of the Debtors, or either of them, or the assets or properties of the
Debtors, or either of them, in any case unless and until the Senior Debt is paid
in full in cash to the satisfaction of the Lender Group and the Commitments are
terminated.
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4. Agent’s Authority to
Act. For so long as any of the Senior Debt shall remain
unpaid, the Agent shall have the right to act as attorney-in-fact for each
Subordinated Party for the purposes specified herein and each Subordinated Party
hereby irrevocably appoints the Agent as such Subordinated Party’s true and
lawful attorney, with full power of substitution, in the name of such
Subordinated Party for the use and benefit of the holders of the Senior Debt
without notice to the Subordinated Parties or any of their representatives,
successors or assigns, to perform the following acts, at the option of the
holders of the Senior Debt, at any meeting of creditors of the Debtors or in
connection with any Insolvency Proceeding:
(a) if
a proper claim or proof of debt in respect of the Subordinated Fees has not been
filed in the form required in any such Insolvency Proceeding at least ten (10)
Business Days prior to the expiration of the time for filing such claims, to
file an appropriate claim for and on behalf of the holders of any Subordinated
Fees;
(b) to
collect any assets of the Debtors distributed, divided or applied by way of
dividend or payment, or any securities issued, on account of the Subordinated
Fees and to apply the same, or the proceeds of any realization upon the same
that the Agent in its discretion elects to effect, to the Senior Debt until all
of the Senior Debt has been paid in full in cash to the satisfaction of the
Lender Group and any commitment of the Agent to extend credit or make other
financial accommodations to any Debtor is terminated, rendering any surplus to
the Subordinated Parties if and to the extent permitted by law; and
(c) generally
to take any action in connection with any such Insolvency Proceeding either in
its own name or in the name of each Subordinated Party (including without
limitation, voting on any plan of reorganization) that the Subordinated Parties
would be authorized to take, but for this Agreement, in the event that the Agent
believes such action is necessary to protect its interests in the Senior Debt
and under this Agreement and after first giving each Subordinated Party five (5)
days’ written notice of its intent to take such action (to the extent such
notice is practicable), provided that the Agent agrees to permit such
Subordinated Party to take action on such Subordinated Party’s own behalf in
connection with any such Insolvency Proceeding as may be necessary to reasonably
protect such Subordinated Party’s interests, as long as such action is not
contrary to or in conflict with the actions and interests of the Agent and such
Subordinated Party’s interests are always in second position to the Senior Debt
and the Senior Lien.
In no
event shall the holder or holders of the Senior Debt be liable to any
Subordinated Party for any failure to prove the Subordinated Fees, to exercise
any right with respect thereto or to collect any sums payable
thereon. A distribution made under this Agreement to holders of
Senior Debt that otherwise would have been made to Subordinated Parties is not,
as between the Debtors, or either of them, its other creditors and any
Subordinated Party, a payment by the Debtors on the Agent, it being understood
that the provisions of this Agreement are solely for the purpose of defining the
relative rights of the Subordinated Parties, on the one hand, and the Senior
Debt on the other hand. Each Subordinated Party represents that such
Subordinated Party shall not assign, participate, pledge, encumber or transfer
any of the Subordinated Fees or any interest therein until the Senior Debt is
repaid in full in cash and the Commitments are terminated. The
power-of-attorney granted hereby is coupled with an interest and shall be
irrevocable.
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5. Duration and
Termination. This Agreement shall constitute a continuing
agreement of subordination, and shall remain in effect until indefeasible
payment in full in cash to the satisfaction of the Lender Group of the Senior
Debt and termination of the Commitments. The holder or holders of
Senior Debt may, without notice to any Subordinated Party extend or continue
credit and make other financial accommodations to or for the account of the
Borrowers in reliance upon this Agreement. The obligations of each
Subordinated Party under this Agreement shall continue to be effective, or be
reinstated, as the case may be, if at any time any payment in respect of any
Senior Debt is rescinded or must otherwise be restored or returned by a holder
of Senior Debt by reason of any Insolvency Proceeding or as a result of the
appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, the Debtors or any substantial part of any Debtor’s property, or
otherwise, all as though such payment had not been made.
6. Subordinated Party’s
Waivers. All of the Senior Debt shall be deemed to have been
made or incurred in reliance upon this Agreement. Each Subordinated
Party expressly waives all notice of the acceptance by the Agent of the
subordination and other provisions of this Agreement and all other notices not
specifically required pursuant to the terms of this Agreement whatsoever, and
each Subordinated Party expressly consents to reliance by the Agent upon the
subordination and other agreements as herein provided. Each
Subordinated Party agrees that the Agent has not made warranties or
representations with respect to the due execution, legality, validity,
completeness or enforceability of the Senior Loan Agreement and other Loan
Documents or the collectibility of the obligations thereunder, that Agent shall
be entitled to manage and supervise its loans in accordance with applicable law
and its usual practices, modified from time to time as it deems appropriate
under the circumstances, and that the Agent shall not have any liability to such
Subordinated Party for, and such Subordinated Party waives any claim (except
with respect to willful misconduct) that such Subordinated Party may now or
hereafter have against Agent arising out of (i) any and all actions that the
Agent takes or omits to take (including, without limitation, actions with
respect to the creation, perfection or continuation of liens or security
interests in the Senior Debt or the Senior Lien, actions with respect to the
occurrence of an Event of Default, actions with respect to the foreclosure upon,
sale, release, or depreciation of, or failure to realize upon, the Collateral
and actions with respect to the collection of any claim for all or any part of
the Senior Debt from any account debtor, guarantor or any other party) with
respect to the documents regarding the Senior Debt or any other agreement
related thereto or to the collection of the Senior Debt or the valuation, use,
protection or release of the Collateral and/or other security for the Senior
Debt, (ii) the Agent’s election, in any proceeding instituted under Chapter 11
of Title 11 of the United States Code (11 U.S.C. Sec. 101 et seq.) (the “Bankruptcy Code”), of
the application of Section 1111 (b)(2) of the Bankruptcy Code, and/or (iii) any
making of loans to, or grant of a security interest under Section 364 of the
Bankruptcy Code by, the Debtors as debtors-in-possession.
7. Waiver of Marshaling; No
Offset. Each Subordinated Party agrees that the Agent shall
have no obligation to marshal any part of the Collateral or any such other
property, instruments, documents, agreements or guaranties before enforcing its
rights against any other part of the Collateral or its rights herein as against
such Subordinated Party. In the event such Subordinated Party is or
becomes indebted to any Debtor, including, without limitation, under any
documents or instruments evidencing the Subordinated Fees, each Subordinated
Party agrees that it shall pay such indebtedness in accordance with its terms
and shall not deduct from or set off against any amounts owed to such Debtor any
amounts such Debtor claims are due to it with respect to the Subordinated
Fees.
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8. No Contest of Security
Interest. No Subordinated Party shall contest the validity,
perfection or enforceability of any lien or security interest granted to the
Agent by any Debtor, and each Subordinated Party agrees to cooperate in the
defense of any action contesting the validity, perfection or enforceability of
such liens or security interests.
9. Subordination Not Affected,
Etc. Nothing in this Agreement shall be construed as affecting
or in any way limiting the extension of new or additional financial
accommodation by the Lender Group to the Borrowers and the terms and conditions
hereof shall apply to such new and additional financial
accommodations. Notwithstanding the preceding sentence or anything
contained in this Agreement to the contrary, none of the provisions of this
Agreement shall be deemed or construed to constitute a commitment or an
obligation on the part of the Lender Group to make any future loans, advances or
other extensions of credit or financial accommodation to the
Borrowers. Each Subordinated Party understands and agrees that all
accrued interest, charges, expenses, attorneys’ fees and other liabilities and
obligations under the Senior Loan Agreement shall constitute part of the Senior
Debt, and nothing in this Agreement shall be construed as affecting or in any
way limiting any indulgence granted by the Lender Group with respect to any
existing financial accommodation to the Borrowers. The subordinations
effected, and the rights created, hereby shall not be affected by (a) any
amendment of or any addition of or supplement to any instrument, document or
agreement relating to the Senior Debt, (b) any exercise or non-exercise of any
right, power or remedy under or in respect of the Senior Debt or any instrument,
document or agreement relating thereto, (c) the release, sale, exchange or
surrender, in whole or in part, of any part of the Collateral or any additional
collateral to which the Agent may become entitled, (d) any release of any
guarantor of or pledgor securing the Senior Debt or any security for such pledge
or guaranty, or (e) any waiver, consent, release, indulgence, extension,
renewal, modification, delay or other action, inaction or omission in respect of
the Senior Debt or any instrument, document or agreement relating thereto or any
security therefor or pledge or guaranty thereof, whether or not each
Subordinated Party shall have had notice or knowledge of any of the foregoing
and regardless of whether each Subordinated Party shall have consented or
objected thereto. Any provision of any document, instrument or
agreement evidencing, securing or otherwise relating to the Subordinated Fees
purporting to limit or restrict in any way any Debtor’s ability to enter into
any agreement with the Agent to amend or modify any document, instrument or
agreement evidencing, securing or otherwise relating to the Senior Debt shall be
deemed of no force or effect until the Senior Debt has been repaid in full in
cash to the satisfaction of the Lender Group and the Commitments have been
terminated.
10. Voided
Payments. Notwithstanding anything herein that may be
construed to the contrary, to the extent that any Debtor makes any payment on
the Senior Debt which, within twelve (12) months of the date of such payment, is
subsequently invalidated, declared to be fraudulent, avoidable or preferential,
set aside or is required to be repaid to a trustee, receiver, the estate of such
Debtor or any other party under any bankruptcy act, state or Federal law,
common
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law or equitable cause (such payment being hereinafter referred to
as a “Voided
Payment”), then, to the extent of such Voided Payment, that portion of
the Senior Debt that had been previously satisfied by such Voided Payment shall
be revived and continue in full force and effect as if such Voided Payment had
never been made. In the event that a Voided Payment is sought to be
recovered from the Agent or any other member of the Lender Group under the
Senior Loan Agreement, an “Event of Default”
under the Senior Loan Agreement shall be deemed to have occurred and to be
continuing from the date of such recovery from the Agent or any such other
member of the Lender Group of such Voided Payment until the full amount of such
Voided Payment is fully and finally restored to the Agent or such other member
of the Lender Group and until such time the provisions of this Agreement shall
be in full force and effect.
11. Violation of Agreement by
Debtors. Each Debtor hereby consents to this Agreement, agrees
to abide by the terms hereof, agrees to make no payments or distributions
contrary to the terms and provisions hereof and to do every act and thing
necessary to carry out such terms and provisions. Each Debtor agrees
that should it make any payment in contravention of any provision of this
Agreement the maturity of said Senior Debt may be accelerated in accordance with
the terms of the Senior Loan Agreement.
12. Waiver. Irrespective
of the due date of any of the Subordinated Fees, each Subordinated Party hereby
expressly waives (except as expressly provided by Section 2(b) hereof)
any and all rights to payment by any Debtor of the Subordinated Fees prior to
repayment in full in cash of the Senior Debt and termination of the
Commitments.
13. Immediate
Effect. This Agreement shall be effective immediately upon its
execution by each of the parties hereto, and there are no conditions precedent
or subsequent to the effectiveness of this Agreement.
14. Inducement. As
an inducement to, and part of the consideration for, the Lender Group’s
extension of credit to the Borrowers, which each Subordinated Party and the
Debtors acknowledge that the Agent and the other members of the Lender Group
would be unwilling to do without this Agreement, each Subordinated Party agrees,
among other things, (i) to subordinate the Subordinated Lien, if any, to the
Senior Lien, (ii) to subordinate the Subordinated Fees to the Senior Debt, and
(iii) to forebear from exercising any creditor’s remedy or taking any action
against any Debtor upon any of its obligations to each Subordinated Party until
the Senior Debt has been paid in full in cash to the satisfaction of the Lender
Group and termination of the Commitments.
15. Successors and Assigns;
Continuing Effect, etc. This Agreement is being entered into
for the benefit of, and shall be binding upon, the Agent, each Subordinated
Party, the Debtors and their respective successors and assigns. The
Agent or any other member of the Lender Group under the Senior Loan Agreement
may assign or participate out to other parties any portion of its interest under
the Senior Debt and no such assignee or participant shall be required to become
a signatory hereto. Any assignee or transferee of each Subordinated
Party shall execute and deliver to the other parties hereto an agreement
pursuant to which they will become
parties hereto as fully as if they were signatories hereto and providing for the
effectiveness of this Agreement as to such transferee or assignee and other
parties.
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16. Notification of
Defaults. Each Subordinated Party shall immediately give
written notice to the Agent of a default or an event of default by either Debtor
under the Management Agreements with respect to the Subordinated
Fees. Each Subordinated Party understands that, subject to any grace
or cure period under such Subordinated Party’s agreements with the Debtors, any
default by either Debtor under the Management Agreements is, automatically, an
“Event of Default” of the Debtors under the Senior Debt. Nothing in
this Agreement shall be interpreted to limit or restrict the right of the Agent
and each Subordinated Party to waive any default under their respective
documents, and each Subordinated Party agrees that any waiver by each
Subordinated Party will be in writing and provided to the Agent.
17. Notices. Any
notices, consents, requests, demands and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed to be
given to any party or parties (a) upon delivery to the address of the party or
parties set forth below if delivered in person or by courier or if sent by
certified or registered mail (return receipt requested), or (b) upon dispatch if
transmitted by telecopy or other means of facsimile transmission, in any case to
the party or parties at the telecopy numbers set forth below:
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If
to the Debtors:
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c/o
Peninsula Gaming Partners, LLC
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▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇., ▇▇▇. ▇▇▇
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▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇
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Attn: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Fax
No. (▇▇▇) ▇▇▇-▇▇▇▇
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If
to the Subordinated Parties
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c/o
Peninsula Gaming Partners, LLC
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▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇., ▇▇▇. ▇▇▇
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▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇
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Attn: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Fax
No. (▇▇▇) ▇▇▇-▇▇▇▇
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If
to Agent:
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▇▇▇▇▇
FARGO FOOTHILL, INC.
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▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Attnention:
Business Finance Division Manager
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with
copies to:
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PAUL,
HASTINGS, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
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▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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Attention: ▇▇▇▇▇
▇. ▇. ▇▇▇▇▇, Esq.
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Fax
No. (▇▇▇) ▇▇▇-▇▇▇▇
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LEGAL_US_W #
62527186.5
9
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Any
party hereto may designate any other address or telecopy number, as
applicable, to which any notices or other communications shall be given by
notice duly given hereunder; provided,
however, that any such notice of other address or telecopy number
shall be deemed to have been given hereunder only when actually received
by the party to which it is
addressed.
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18. Amendments;
Modifications. This Agreement may not be modified, altered or
amended except by an agreement in writing executed by all of the parties
hereto.
19. Amendment of Management
Agreements. Except to the extent expressly provided in the
Senior Loan Agreement, each Subordinated Party and each Debtor agree to forbear
from (a) modifying, altering or amending any term of the Management Agreements,
and (b) from granting (in the case of either Debtor) and receiving (in the case
of any Subordinated Party) any collateral or other security of any nature to
secure the Subordinated Fees.
20. Cost and Expenses of
Enforcement. Each Subordinated Party agrees to pay all costs
and expenses including, without limitation, attorneys’, paralegals’ and other
professionals’ fees of every kind, paid or incurred by the Agent in enforcing
its rights hereunder against each Subordinated Party, including, but not limited
to, litigation instituted in a state or federal court, as hereinafter provided
(including proceedings under the Bankruptcy Code) in endeavoring to collect the
Senior Debt or in so enforcing this Agreement, or in defending against any
defense, cause of action, counterclaim, setoff or cross claim based on any act
of commission or omission by the Agent with respect to the Senior Debt promptly
on demand of the Agent or other person paying or incurring the
same.
21. Jurisdiction. TO
INDUCE THE AGENT AND THE OTHER MEMBERS OF THE LENDER GROUP TO AFFORD FINANCIAL
ACCOMMODATIONS TO THE BORROWERS, EACH SUBORDINATED PARTY IRREVOCABLY AGREES THAT
ALL ACTIONS ARISING DIRECTLY OR INDIRECTLY AS A RESULT OR IN CONSEQUENCE OF THIS
AGREEMENT SHALL BE INSTITUTED AND LITIGATED ONLY IN COURTS HAVING SITUS IN THE
CITY OF NEW YORK, NEW YORK AND EACH SUBORDINATED PARTY HEREBY CONSENTS TO THE
EXCLUSIVE JURISDICTION AND VENUE OF ANY STATE OR FEDERAL COURT LOCATED AND
HAVING ITS SITUS IN SAID CITY AND STATE. EACH SUBORDINATED PARTY
HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS,
AND EACH SUBORDINATED PARTY HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL
PROCESS. THE PARTIES CONSENT THAT ALL SUCH SERVICE OF PROCESS MAY BE
MADE BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, DIRECTED TO THE AGENT OR EACH
SUBORDINATED PARTY AT THE ADDRESS OF OEDA SET FORTH HEREIN IN THE MANNER
PROVIDED BY APPLICABLE STATUTE, LAW, RULE OF COURT, OR OTHERWISE.
22. Waiver of Claims; Trial by
Jury. EACH SUBORDINATED PARTY WAIVES EVERY DEFENSE, CAUSE OF
ACTION, COUNTERCLAIM OR SETOFF, THAT EACH SUBORDINATED PARTY MAY NOW HAVE, OR
HEREAFTER MAY HAVE, TO ANY
LEGAL_US_W #
62527186.5
10
ACTION BY
THE AGENT IN ENFORCING THIS AGREEMENT AND RATIFIES AND CONFIRMS WHATEVER THE
AGENT MAY DO PURSUANT TO THE TERMS HEREOF AND AGREES THAT THE AGENT SHALL NOT BE
LIABLE FOR ANY ERRORS OF JUDGMENT OR MISTAKE OF FACT OR LAW EXCEPT FOR WILLFUL
MISCONDUCT OF AGENT. THE AGENT AND EACH SUBORDINATED PARTY,
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE IRREVOCABLY, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, THE RIGHT ANY ONE OF THEM MAY HAVE TO TRIAL BY JURY
WITH RESPECT TO ANY LEGAL PROCEEDING BASED HEREON, OR ARISING OUT OF, UNDER OR
IN CONNECTION WITH THIS AGREEMENT AND ANY AGREEMENT CONTEMPLATED TO BE EXECUTED
IN CONJUNCTION HEREWITH OR ANY COURSE OF CONDUCT OR COURSE OF DEALING, IN WHICH
THE AGENT AND EACH SUBORDINATED PARTY ARE ADVERSE PARTIES. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER GROUP TO MAKE LOANS AND OTHER
FINANCIAL ACCOMMODATIONS TO THE BORROWERS.
23. Governing Law; Benefit of
Agreement. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York, without regard to
the conflict of law, principles thereof other than Sections 5-1401 and 5-1402 of
the New York General Obligations Law. All of the understandings,
agreements, covenants and representations contained herein are solely for the
benefit of the Agent and each Subordinated Party, and there are no other persons
who are intended to be benefited in any way whatsoever by this
Agreement.
24. Severability. In
the event any one or more of the provisions contained herein shall for any
reason be held to be invalid, illegal or unenforceable in any respect by a court
of competent jurisdiction, such invalidity, illegality or unenforceability shall
not affect any other provision hereof, and this Agreement shall be construed as
if such invalid, illegal or unenforceable provision had never been contained
herein.
25. Counterparts. This
Agreement may be executed in any number of counterparts and by different parties
on separate counterparts, each of which, when executed and delivered, shall be
deemed to be an original, and all of which, when taken together, shall
constitute but one and the same Agreement. Delivery of an executed
counterpart of this Agreement by telefacsimile or other electronic method of
transmission shall be equally as effective as delivery of an original executed
counterpart of this Agreement.
26. Perfection and Release of
Liens. Upon the Agent’s reasonable request (which request
shall be in writing), each Subordinated Party hereby agrees to execute and
deliver such documents, instruments, lien releases, assignments and financing
statements and do such acts as may be necessary in order for the Agent to
establish and maintain a first, valid, prior and perfected security interest in
the Collateral. In the event of any sale or other disposition of all
or any part of the Collateral prior to payment in full of the Senior Debt, upon
request by the Agent, each Subordinated Party shall execute releases,
assignments, UCC terminations and other similar agreements that are reasonably
requested by the Agent from time to time. Until payment and
satisfaction in full of the Senior Debt, each Subordinated Party shall cooperate
fully in releasing
LEGAL_US_W #
62527186.5
11
the
Subordinated Lien, if in existence at such time, as soon as practicable upon the
reasonable request of the Agent.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
LEGAL_US_W #
62527186.5
12
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
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Debtors:
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THE
OLD ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, L.L.C.
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a
Louisiana liability company
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By:
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/s/▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title: CFO
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▇▇▇▇▇▇▇
▇▇ WORTH, LLC, a Delaware
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limited
liability company
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By:
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/s/▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title: CFO
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Subordinated
Parties:
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OED
ACQUISITION, LLC, a Delaware
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limited
liability company
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By:
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/s/▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title: CFO
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▇▇▇▇▇▇▇
▇▇, LLC, a Delaware
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limited
liability company
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By:
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/s/▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title: CFO
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PENINSULA
GAMING PARTNERS, LLC,
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A
Delaware limited liability company
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By:
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/s/▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Title: CFO
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Agent:
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▇▇▇▇▇
FARGO FOOTHILL, INC.
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a
California company
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By:
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/s/▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
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Title:
Vice President
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