EXHIBIT 4.7
STOCK PLEDGE AGREEMENT
MADE BY
HWCC-LOUISIANA, INC.
in favor of
STATE STREET BANK AND TRUST COMPANY,
AS TRUSTEE AND SECURED PARTY
August 10, 1999
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (this "Agreement") is made as of August 10,
1999 by HWCC-LOUISIANA, INC., a Louisiana corporation, with principal offices at
Two Galleria Tower, Suite 2200, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
("Pledgor"), in favor of STATE STREET BANK AND TRUST COMPANY, Massachusetts
chartered trust company, with offices at ▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ Trust
Department, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as Trustee acting on behalf of the
Holders of the Notes under (and as defined in) the Indenture described below
("Secured Party").
RECITALS
A. Hollywood Casino Shreveport, a Louisiana general partnership
("Hollywood Casino Shreveport"), Shreveport Capital Corporation, a Louisiana
corporation ("Shreveport Capital", and together with Hollywood Casino
Shreveport, the "Issuers"), HCS I, Inc., a Louisiana corporation, HCS II, Inc.,
a Louisiana corporation, and Pledgor, each as a Guarantor, and Secured Party, as
Trustee, have entered into an Indenture dated as of August 10, 1999 (as the same
may be amended, supplemented, restated or otherwise modified from time to time,
the "Indenture"), pursuant to which the Issuers will issue up to $150,000,000 of
their 13% First Mortgage Notes due 2006 with Contingent Interest (as the same
may be amended, supplemented, restated, exchanged, replaced or otherwise
modified from time to time, collectively, the "Notes").
B. The Secured Party has requested pursuant to the terms of the
Indenture that Pledgor execute and deliver this Agreement, and Pledgor has
agreed to enter into this Agreement.
C. Therefore, in order to comply with the terms and conditions of the
Indenture and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Pledgor hereby agrees with Secured
Party as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Terms Defined Above or in the Indenture. As used in this
Agreement, the terms defined above shall have the meanings respectively assigned
to them. Other capitalized terms which are defined in the Indenture but which
are not defined herein shall have the same meanings as defined in the Indenture.
Section 1.02 Certain Definitions. As used in this Agreement, the
following terms shall have the following meanings, unless the context otherwise
requires:
"Code" shall mean the Uniform Commercial Code as presently in effect
in the State of New York. Unless otherwise indicated by the context herein,
all uncapitalized terms which are defined in the Code shall have their
respective meanings as used in Articles 8 and 9 of the Code; provided that,
if by reason of mandatory provisions of law,
the perfection or the effect of perfection or non-perfection of the
security interests in any Collateral is governed by the Uniform Commercial
Code as in effect in any jurisdiction other than the State of New York,
"Code" means the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to such
perfection or the effect of perfection or non-perfection.
"Collateral" shall mean the following types or items of property,
whether now owned or hereafter acquired:
(a) The securities of the Pledged Entities described or referred to in
Exhibit A attached hereto and made a part hereof (as the same may hereafter
be amended, supplemented or otherwise modified); and
(b) (i) all shares of, all securities convertible or exchangeable
into, and all warrants, options or other rights to purchase shares of,
stock of the Pledged Entities; (ii) all certificates or instruments
representing such additional shares, convertible or exchangeable
securities, warrants, and other rights; (iii) except as otherwise provided
herein, all proceeds, income and profits thereon, and all interest,
dividends and other payments, property and distributions with respect
thereto; (iv) except as otherwise provided herein, all proceeds received or
receivable by the Pledgor, in cash, stock or otherwise, from any
recapitalization, reclassification, merger, dissolution, liquidation or
other termination of the existence of the Pledged Entities and (v) except
as otherwise provided herein, any proceeds of any of the foregoing.
(c) It is expressly contemplated that pursuant to clause (b) above,
additional securities or other property may from time to time be pledged,
assigned or granted to Secured Party as additional security for the
Obligations, and the term "Collateral" as used herein shall be deemed for
all purposes hereof to include all such additional securities and property,
together with all other property of the types described above related
thereto.
"Event of Default" shall mean any event specified in Section 6.01
hereof.
"Obligations" shall mean: (i) the payment when due of indebtedness
evidenced by the Notes in the aggregate principal sum not to exceed at any
time outstanding of $150,000,000, interest as set forth in the Indenture
and the Notes, and premiums, penalties, and late charges thereon; (ii) all
other indebtedness and other sums (including, without limitation, all
expenses, attorneys' fees, other fees, indemnifications, reimbursements,
damages, other monetary liabilities, and other charges) and obligations
that may or shall become due hereunder or under the Notes, the Guarantees,
the Indenture, or the other Collateral Documents, and (iii) any and all
renewals, modifications, amendments, extensions for any period, supplements
or restatements of any of the foregoing.
"Obligor" shall mean any Person, other than Pledgor, liable (whether
directly or indirectly, primarily or secondarily) for the payment or
performance of any of
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the Obligations whether as maker, co-maker, endorser,guarantor,
accommodation party, general partner or otherwise.
"Pledged Entities" shall mean each of the Subsidiaries of Pledgor
named on Exhibit A attached hereto and made a part hereof, and any other
Restricted Subsidiary of Pledgor required to become a Guarantor pursuant to
Section 11.02 of the Indenture, and which pledge to the Trustee hereunder
has been approved by applicable Gaming Authorities. To the extent that any
Restricted Subsidiary of Pledgor is required to be designated a Pledged
Entity, Exhibit A shall be hereafter amended, supplemented or modified in
accordance with Section 4.02.
"Pledged Securities" shall mean all of the securities referred to in
the definition of Collateral and all additional securities (as that term is
defined in the Code), if any, constituting Collateral under this Agreement.
ARTICLE II
SECURITY INTEREST
Section 2.01 Pledge. Pledgor hereby assigns, endorses, delivers,
pledges, and grants to Secured Party, a continuing security interest in, and
Lien upon, the Collateral to secure the prompt and complete payment and
performance of the Obligations and the performance by Pledgor of this Agreement.
This security interest is granted as security only and shall not subject Secured
Party to, or transfer or in any way affect or modify, any obligation or
liability of the Pledgor or any Obligor with respect to any of the Collateral,
the Obligations or any transaction in connection therewith.
Section 2.02 Transfer of Collateral. All certificates or instruments
representing or evidencing the Pledged Securities shall be delivered to and held
by Secured Party or a Person designated by Secured Party pursuant hereto. All
Pledged Securities shall be in suitable form for transfer by delivery, or shall
be accompanied by duly executed instruments of transfer or assignment in blank,
and accompanied by any required transfer tax stamps. Upon the occurrence and
continuance of an Event of Default, Secured Party shall have the right, at any
time in its discretion and without notice to Pledgor, to transfer to or to
register in the name of Secured Party or any of its nominees any or all of the
Collateral. In addition, upon the occurrence and continuance of an Event of
Default, Secured Party shall have the right at any time to exchange certificates
or instruments representing or evidencing Pledged Securities for certificates or
instruments of smaller or larger denominations.
Section 2.03 Ratable Benefit of Holders of the Notes. Pledgor and
Secured Party agree that the security interest and lien granted hereby are for
the benefit of the Trustee for the equal and ratable benefit of the Holders of
the Notes.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
In order to induce Secured Party to accept this Agreement, Pledgor
represents and warrants to Secured Party (which representations and warranties
will survive the creation and payment of the Obligations) that:
Section 3.01 Ownership of Collateral; Absence of Encumbrances and
Restrictions. After giving effect to the use of proceeds of the Notes, Pledgor
is, and in the case of Collateral acquired after the date hereof, will be, the
legal and sole holder of record and the sole beneficial owner of the Collateral,
free and clear of all Liens except for Permitted Liens, and Pledgor has full
right, power and authority to pledge, assign and grant a security interest in
the Collateral to Secured Party. All of the Pledged Securities are presently
represented by the certificates listed on Exhibit A hereto. As of the date
hereof, there are no existing options, warrants, calls or commitments of any
character whatsoever relating to the Pledged Securities.
Section 3.02 No Required Consent. Except for such authorizations,
consents and other actions as shall have been obtained and shall be in effect,
no authorization, consent, approval or other action by, and no notice to or
registration, recordation or filing with, any Governmental Authority is required
for (i) the due execution, delivery and performance by Pledgor of this
Agreement, (ii) the grant by Pledgor of the security interest granted by this
Agreement, (iii) the perfection of such security interest (except for the filing
of any appropriate financing statements) or (iv) except as may be required by
applicable gaming laws or except as may be required in connection with the
disposition of Collateral by federal and state securities laws or antitrust laws
and the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, the exercise by
Secured Party of its rights and remedies under this Agreement. Neither the
Pledgor nor any of its Subsidiaries has performed or will perform any acts which
might prevent Secured Party from enforcing any of the terms and conditions of
this Agreement or which would limit Secured Party in any such enforcement. None
of the Pledged Securities have been issued or transferred in violation of the
securities registration, securities disclosure or similar laws of any
jurisdiction to which such issuance or transfer may be subject.
Section 3.03 Pledged Securities. The Pledged Securities have been duly
authorized and validly issued, and are fully paid and non-assessable. The
Pledged Securities constitute 100% of the issued and outstanding shares of
capital stock of the Pledged Entities. Contemporaneously with the issuance of
the Notes, the Pledgor is delivering to Secured Party in pledge hereunder the
certificates and other instruments evidencing all Pledged Securities owned by
the Pledgor as of the date hereof.
Section 3.04 First Priority Security Interest. Upon the delivery of
Pledged Securities to the Secured Party, this Agreement creates a valid and
perfected first priority security interest in the Collateral, subject to
Permitted Liens, enforceable against Pledgor and all third parties and securing
payment of the Obligations, except that (a) the enforceability of any rights to
indemnity and contribution hereunder may be limited by federal or state
securities laws or principles of public policy, (b) the enforceability hereof
may be subject to applicable bankruptcy,
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insolvency, fraudulent conveyance or transfer, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally, and (c) the
enforceability hereof may be subject to general principles of equity (regardless
of whether enforcement is sought in a proceeding at law or in equity).
ARTICLE IV
COVENANTS AND AGREEMENTS
Pledgor will at all times comply with the covenants and agreements
contained in this Article IV from the date hereof and for so long as any part of
the Obligations are outstanding.
Section 4.01 Sale, Disposition or Encumbrance of Collateral. Except as
may be permitted by the provisions hereof or of the Indenture, Pledgor will not
in any way encumber any of its rights in or to any of the Collateral (or permit
or suffer any of the Collateral to be encumbered) or sell, pledge, assign, lend
or otherwise dispose of or transfer any of the Collateral to or in favor of any
Person other than Secured Party. The Pledgor is not, and will not become, a
party to or be otherwise bound by any agreement, other than this Agreement or as
permitted by the Indenture, which restricts in any manner the rights of any
present or future holder of any of the Pledged Securities.
Section 4.02 Dividends or Distributions. So long as no Event of
Default shall have occurred and be continuing, Pledgor shall be entitled to
receive and retain free and clear of the Lien of this Agreement any and all
dividends, distributions, interest and principal payments, cash, instruments and
other property and proceeds made upon or with respect to the Collateral, which
shall not constitute Collateral and may be used by Pledgor subject to the terms
and conditions of the Indenture; provided, however, that any and all dividends
paid or payable in securities of the Pledged Entities, including all securities
convertible into any Collateral, and warrants, options or other rights to
purchase stock or equity interests, in any of the Pledged Entities, receivable
or otherwise distributed in respect of, or in exchange for (including, without
limitation, any certificate or share purchased or exchanged in connection with a
tender offer or merger agreement) any Collateral, shall be, and shall be
forthwith delivered to Secured Party to hold as, Collateral and shall, if
received by Pledgor, be received in trust for the benefit of Secured Party, be
segregated from the other Property or funds of Pledgor, and be forthwith
delivered to Secured Party as Collateral in the same form as so received (with
any necessary endorsement). Upon the occurrence and during the continuance of an
Event of Default, all rights of Pledgor to receive all dividends, distributions,
interest and principal payments, cash, instruments and other property and
proceeds shall cease, and such dividends, distributions, interests and principal
payments, cash, instruments and other property and proceeds shall constitute
Collateral and shall be paid or otherwise delivered to the Secured Party. In the
event that Pledgor is required by the provisions hereof or of the Indenture to
pledge additional capital stock (including, without limitation, the capital
stock of any newly acquired or formed Restricted Subsidiary of Pledgor) as
collateral for the Obligations, then Pledgor and Secured Party shall execute an
amendment to this Agreement attaching an amended, supplemented or modified
Exhibit A hereto.
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Section 4.03 Records and Information. Pledgor shall keep accurate and
complete records of the Collateral (including proceeds, payments, distributions,
income and profits). Upon reasonable notice during regular business hours and
without undue interference with the Pledgor's business, Secured Party may at any
time have access to, examine, audit, make extracts from and inspect without
hindrance or delay Pledgor's records, files and the Collateral.
Section 4.04 Further Assurances. Upon the request of Secured Party,
Pledgor shall (at Pledgor's expense) execute and deliver all such assignments,
certificates, instruments, securities, financing statements, notifications to
financial intermediaries, clearing corporations, the Pledged Entities of the
Pledged Securities or other third parties or other documents and give further
assurances and do all other acts and things as Secured Party may reasonably
request to perfect Secured Party's interest in the Collateral or which is
necessary to protect, enforce or otherwise effect Secured Party's rights and
remedies hereunder.
Section 4.05 Stock Powers. Pledgor shall furnish to Secured Party such
stock powers and other instruments as may reasonably be required by Secured
Party to assure the transferability of the Collateral when and as often as may
be requested by Secured Party.
Section 4.06 Rights to Sell.
(a) If Secured Party shall determine to exercise its rights to sell
all or any of the Collateral pursuant to its rights hereunder, Pledgor agrees
that, upon request of Secured Party, Pledgor will, at its own expense:
(i) use its best efforts to qualify the Collateral under the
state securities or "Blue Sky" laws and to obtain all necessary governmental
approvals for the sale of the Collateral, as requested by Secured Party; and
(ii) use its commercially reasonable best efforts to do or cause
to be done all such other acts and things as may be necessary to make such sale
of the Collateral or any part thereof valid and binding and in compliance with
applicable law.
(b) Pledgor further acknowledges the impossibility of ascertaining the
amount of damages which would be suffered by Secured Party and the Holders of
the Notes by reason of the failure by Pledgor to perform any of the covenants
contained in this Section 4.06 and consequently agrees that if Pledgor shall
fail to perform any of such covenants, it shall be subject to a suit for
specific performance of such covenants.
Section 4.07 Voting and Other Consensual Rights. Except to the extent
otherwise provided in Section 6.06(d) hereof, Pledgor shall be entitled to
exercise any and all voting and other consensual rights pertaining to the
Collateral or any part thereof for any purpose not inconsistent with the terms
of this Agreement or the Indenture or any other Collateral Document.
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ARTICLE V
RIGHT, DUTIES, AND POWERS OF SECURED PARTY
Secured Party shall have the following rights, duties and powers:
Section 5.01 Discharge Encumbrances. After the occurrence and during,
the continuance of an Event of Default, Secured Party may, at its option,
discharge any taxes, Liens, security interests or other encumbrances at any time
levied or placed on the Collateral. Pledgor agrees to reimburse Secured Party as
provided in the Indenture.
Section 5.02 Cumulative and Other Rights. The rights, powers and
remedies of Secured Party hereunder are in addition to all rights, powers and
remedies given by law or in equity. The exercise by Secured Party of any one or
more of the rights, powers and remedies herein shall not be construed as a
waiver of any other rights, powers and remedies, including, without limitation,
any other rights of set-off (provided that set-off rights may not be exercised
prior to the acceleration of the Notes).
Section 5.03 Disclaimer of Certain Duties.
(a) The powers conferred upon Secured Party by this Agreement are to
protect its interest in the Collateral and shall not impose any duty upon
Secured Party to exercise any such powers. Pledgor hereby agrees that Secured
Party shall not be liable for, nor shall the indebtedness evidenced by the
Obligations be diminished by, Secured Party's delay or failure to collect upon,
foreclose, sell, take possession of or otherwise obtain value for the
Collateral.
(b) Except as may be required by the provisions of the Indenture, and
to the fullest extent permitted by applicable law, Secured Party shall be under
no duty whatsoever to make or give any presentment, notice of dishonor, protest,
demand for performance, notice of non-performance, notice of intent to
accelerate, notice of acceleration, or other notice or demand in connection with
any Collateral or the Obligations, or to take any steps necessary to preserve
any rights against any Obligor or other Person. Pledgor waives any right of
marshaling in respect of any and all Collateral, and waives any right to require
Secured Party to proceed against any Obligor or other Person, exhaust any
Collateral or enforce any other remedy which Secured Party now has or may
hereafter have against any Obligor or other Person.
Section 5.04 Modification of Obligations; Other Security. Except as
specifically provided for in the Indenture, Pledgor waives (i) any and all
notice of acceptance, creation, modification, rearrangement, renewal or
extension for any period of any instrument executed by any Obligor in connection
with the Obligations, and (ii) to the fullest extent permitted by applicable
law, any defense of any Obligor by reason of disability, lack of authorization,
cessation of the liability of any Obligor or for any other reason. Pledgor
authorizes Secured Party, without notice or demand and without any reservation
of rights against Pledgor and without affecting Pledgor's liability hereunder or
on the Obligations, from time to time after the occurrence and during the
continuance of an Event of Default, to (x) apply the Collateral in the manner
permitted by this Agreement, and (y) after the occurrence and during the
continuance of
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an Event of Default, renew, extend for any period, accelerate, amend or modify,
supplement, enforce, compromise, settle, waive or release the obligations of any
Obligor or any instrument or agreement of such other Person with respect to any
or all of the Obligations or Collateral.
Section 5.05 Custody and Preservation of the Collateral. Secured Party
shall be deemed to have exercised reasonable care in the custody and
preservation of the Collateral in its possession if the Collateral is accorded
treatment substantially equal to that which comparable secured parties accord
comparable collateral, it being understood and agreed, however, that Secured
Party shall not have responsibility for (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relative to any Collateral, whether or not Secured Party has or is deemed to
have knowledge of such matters, or (ii) taking any necessary steps to preserve
rights against Persons or entities with respect to any Collateral.
ARTICLE VI
EVENTS OF DEFAULT
Section 6.01 Events. It shall constitute an Event of Default under
this Agreement if an "Event of Default" occurs and is continuing under the
Indenture.
Section 6.02 Remedies. Upon the occurrence and during the continuance
of any Event of Default, Secured Party may take any or all of the following
actions without notice (except where expressly required below or in the
Indenture) or demand to Pledgor:
(a) Sell, in one or more sales and in one or more parcels, or
otherwise dispose of any or all of the Collateral in any commercially reasonable
manner as Secured Party may elect, in a public or private transaction, at any
location as deemed reasonable by Secured Party for cash at such price as Secured
Party may deem fair; and (unless prohibited by the Code, as adopted in any
applicable jurisdiction) Secured Party may be the purchaser of any or all
Collateral so sold and may apply upon the purchase price therefor any
Obligations secured hereby. Any such sale or transfer by Secured Party either to
itself or to any other Person shall be absolutely free from any claim of right
by Pledgor, including any equity or right of redemption, stay or appraisal which
Pledgor has or may have under any rule of law, regulation or statute now
existing or hereafter adopted. Upon any such sale or transfer, Secured Party
shall have the right to deliver, assign and transfer to the purchaser or
transferee thereof the Collateral so sold or transferred. If Secured Party deems
it advisable to do so, it may restrict the bidders or purchasers of any such
sale or transfer to Persons or entities who will represent and agree that they
are purchasing the Collateral for their own account and not with the view to the
distribution or resale of any of the Collateral. Secured Party may, at its
discretion, provide for a public sale, and any such public sale shall be held at
such time or times within ordinary business hours and at such place or places as
Secured Party may fix in the notice of such sale. Secured Party shall not be
obligated to make any sale pursuant to any such notice. Secured Party may,
without notice or publication, adjourn any public or private sale by
announcement at any time and place fixed for such sale, and such sale may be
made at any time or place to which the same may be so adjourned. In the event
any sale or transfer hereunder is not completed or is defective in the opinion
of Secured Party, such sale or transfer shall not exhaust the rights of Secured
Party hereunder, and Secured Party shall
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have the right to cause one or more subsequent sales or transfers to be made
hereunder. If only part of the Collateral is sold or transferred such that the
Obligations remain outstanding (in whole or in part), Secured Party's rights and
remedies hereunder shall not be exhausted, waived or modified, and Secured Party
is specifically empowered to make one or more successive sales or transfers
until all the Collateral shall be sold or transferred and all the Obligations
are paid. In the event that Secured Party elects not to sell the Collateral,
Secured Party retains its rights to dispose of or utilize the Collateral or any
part or parts thereof in any manner authorized or permitted by law or in equity,
and to apply the proceeds of the same towards payment of the Obligations. Each
and every method of disposition of the Collateral described in this Section 6.02
shall constitute disposition in a commercially reasonable manner.
(b) Apply proceeds of the disposition of the Collateral to the
Obligations as provided by the Indenture. Such application may include, without
limitation, the reasonable attorneys' fees and legal expenses incurred by
Secured Party.
(c) Appoint any Person as agent to perform any act or acts necessary
or incident to any sale or transfer by Secured Party of the Collateral.
(d) Execute, assign and endorse negotiable and other instruments for
the payment of money, documents of title or other evidences of payment, shipment
or storage for any form of Collateral on behalf of and in the name of Pledgor.
(e) Exercise all other rights and remedies permitted by law or in
equity.
Section 6.03 Attorney-in-Fact. Pledgor hereby irrevocably appoints
Secured Party as Pledgor's attorney-in-fact, with full authority in the place
and stead of Pledgor and in the name of Pledgor or otherwise, from time to time
in Secured Party's reasonable discretion upon the occurrence and during the
continuance of an Event of Default, but at Pledgor's cost and expense, to take
any action and to execute any assignment, certificate, financing statement,
stock power, notification, document or instrument which Secured Party may
reasonably deem necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation, to receive, endorse and collect all
instruments made payable to Pledgor representing any dividend, interest payment
or other distribution in respect of the Collateral or any part thereof and to
give full discharge for the same.
Section 6.04 Liability for Deficiency. If any sale or other
disposition of Collateral by Secured Party or any other action of Secured Party
hereunder results in reduction of the Obligations, such action will not release
Pledgor from its liability to Secured Party for any unpaid Obligations,
including reasonable costs, charges and expenses incurred in the liquidation of
Collateral and the same shall be immediately due and payable to Secured Party at
Secured Party's address set forth in the opening paragraph hereof.
Section 6.05 Reasonable Notice. If any applicable provision of any law
requires Secured Party to give reasonable notice of any sale or disposition or
other action, Pledgor hereby agrees that ten (10) days' prior written notice
shall constitute reasonable notice thereof.
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Such notice, in the case of public sale, shall state the time and place fixed
for such sale and, in the case of private sale, the time after which such sale
is to be made.
Section 6.06 Pledged Securities. Upon the occurrence and during the
continuance of an Event of Default:
(a) All rights of Pledgor to receive the property which it would
otherwise be authorized to receive and retain pursuant to Section 4.02 hereof
shall cease, and all such rights shall thereupon become vested in Secured Party
who shall thereupon have the sole right to receive and hold as Collateral such
property, but Secured Party shall have no duty to receive and hold such property
and shall not be responsible for any failure to do so or delay in so doing.
(b) All property which is received by Pledgor contrary to the
provisions of this Section 6.06 shall be received in trust for the benefit of
Secured Party, shall be segregated from other funds of Pledgor and shall be
forthwith paid over to Secured Party as Collateral in the same form as so
received (with any necessary endorsement).
(c) Secured Party may exercise any and all rights of conversion,
exchange, subscription or any other rights, privileges or options pertaining to
any of the Pledged Securities as if it were the absolute owner thereof,
including without limitation, the right to exchange at its discretion, any and
all of the Pledged Securities upon the merger, consolidation, reorganization,
recapitalization or other readjustment of the Pledged Entities or upon the
exercise by the Pledged Entities or Secured Party of any right, privilege or
option pertaining to any of the Pledged Securities, and in connection therewith,
to deposit and deliver any and all of the Pledged Securities with any committee,
depository, transfer agent, registrar or other designated agency upon such terms
and conditions as it may determine, all without liability except to account for
property actually received by it, but Secured Party shall have no duty to
exercise any of the aforesaid rights, privileges or options and shall not be
responsible for any failure to do so or delay in so doing .
(d) All rights of Pledgor to exercise the voting and other consensual
rights which Pledgor would otherwise be entitled to exercise pursuant to Section
4.07 hereof with respect to the Pledged Securities issued by the Pledged
Entities shall cease, and all such rights shall thereupon become vested in
Secured Party who shall thereupon have the sole right to exercise such voting
and other consensual rights, but Secured Party shall have no duty to exercise
any such voting or other consensual rights and shall not be responsible for any
failure to do so or delay in so doing.
Section 6.07 Non-judicial Enforcement. Secured Party may enforce its
rights hereunder without prior judicial process or judicial hearing, and to the
extent permitted by law, Pledgor expressly waives any and all legal rights which
might otherwise require Secured Party to enforce its rights by judicial process.
Section 6.08 Private Sale of Securities. Pledgor recognizes that
Secured Party may deem it impracticable to effect a public sale of all or any
part of the Securities and that Secured Party may, therefore, determine to make
one or more private sales of any such Securities to
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a restricted group of purchasers who will be obligated to agree, among other
things, to acquire such Securities for their own account, for investment and not
with a view to the distribution or resale thereof. Pledgor acknowledges that
any such private sale may be at prices and on terms less favorable to the seller
than the prices and other terms which might have been obtained at a public sale
and, notwithstanding the foregoing, agrees that such private sale shall be
deemed to have been made in a commercially reasonably manner and that Secured
Party shall have no obligation to delay sale of any such securities for the
period of time necessary to permit Pledgor to register such Securities for
public sale under the Securities Act of 1933, as amended (the "Securities Act").
Pledgor further acknowledges and agrees that any offer to sell such Securities
which has been (i) publicly advertised on a bona fide basis in a newspaper or
other publication of general circulation in the financial community of New York,
New York (to the extent that such an offer may be so advertised without prior
registration under the Securities Act), or (ii) made privately in the manner
described above to not less than fifteen (15) bona fide offerees shall be deemed
to involve a "public sale" for the purposes of Section 9-504(c) of the Code (or
any successor or similar, applicable statutory provision) as then in effect in
the State of New York, notwithstanding that such sale may not constitute a
"public offering" under the Securities Act and that Secured Party may, in such
event, bid for the purchase of such Securities.
ARTICLE VII
MISCELLANEOUS
Section 7.01 Notices. Any notice required or permitted to be given
under or in connection with this Agreement shall be given in accordance with the
notice provisions of the Indenture.
Section 7.02 Amendments and Waivers. Secured Party's acceptance of
partial or delinquent payments or any forbearance, failure or delay by Secured
Party in exercising any right, power or remedy hereunder shall not be deemed a
waiver of any obligation of Pledgor or any Obligor, or of any right, power or
remedy of Secured Party, and no partial exercise of any right, power or remedy
shall preclude any other or further exercise thereof. Secured Party may remedy
any Event of Default hereunder or in connection with the Obligations without
waiving the Event of Default so remedied. Pledgor hereby agrees that if Secured
Party and the Holders of the Notes agree to a waiver of any provision hereunder,
as provided by the Indenture, or an exchange of or release of the Collateral, or
the addition or release of any Obligor or other Person, any such action shall
not constitute a waiver of any of Secured Party's other rights or of Pledgor's
obligations hereunder. This Agreement may be amended only by an instrument in
writing in the manner set forth in the Indenture and may be supplemented only by
documents delivered or to be delivered in accordance with the express terms
hereof.
Section 7.03 Redelivery of Collateral. If any sale or transfer of
Collateral by Secured Party results in full satisfaction of the Obligations, and
after such sale or transfer and discharge there remains a surplus of proceeds,
Secured Party will deliver to Pledgor or such other Person as may be required by
a Governmental Authority such excess proceeds in a commercially reasonable time;
provided, however, that neither Secured Party nor any Holders of the Notes
11
shall have any liability for any interest, cost or expense in connection with
any reasonable delay in delivering such proceeds to Pledgor.
Section 7.04 Gaming Authority. Each of the provisions of this
Agreement is subject to, and shall be enforced in compliance with, the
requirements of any applicable Gaming Authority.
Section 7.05 Governing Law; Jurisdiction. This Agreement and the
security interest granted hereby shall be construed in accordance with and
governed by the laws of the State of New York (except to the extent that the
laws of any other jurisdiction govern the perfection and priority of the
security interests granted hereby).
Section 7.06 Continuing Security Agreement.
(a) Except as may be expressly applicable pursuant to Section 9-505 of
the Code, no action taken or omission to act by Secured Party hereunder,
including, without limitation, any exercise of voting or consensual rights
pursuant to Section 6.06(d) hereof or any other action taken or inaction
pursuant to Section 6.02 hereof, shall be deemed to constitute a retention of
the Collateral in satisfaction of the Obligations or otherwise to be in full
satisfaction of the Obligations, and the Obligations shall remain in full force
and effect until Secured Party shall have applied payments (including, without
limitation, collections from Collateral) towards the Obligations in the full
amount then outstanding or until such subsequent time as is hereinafter provided
in Section 7.06(b) hereof.
(b) To the extent that any payments on the Obligations or proceeds of
the Collateral are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, debtor in
possession, receiver or other Person under any bankruptcy law, common law or
equitable cause, then to such extent the Obligations so satisfied shall be
revived and continue as if such payment or proceeds had not been received by
Secured Party, and Secured Party's security interests, rights, powers and
remedies hereunder shall continue in full force and effect. In such event, this
Agreement shall be automatically reinstated if it shall theretofore have been
terminated pursuant to Section 7.07 hereof.
Section 7.07 Termination. The grant of a security interest hereunder
and all of Secured Party's rights, powers and remedies in connection therewith
shall, unless otherwise provided in the Indenture or in this Agreement, remain
in full force and effect until the payment in full of (a) the Notes under the
terms of the Indenture and (b) all Obligations then due and owing under the
Indenture, the Notes and the Collateral Documents; provided, however, that after
receipt from the Pledgor by the Secured Party of a request for a release of any
Collateral permitted under the Indenture upon the sale, transfer, assignment,
exchange or other disposition of the Collateral not prohibited by the Indenture
(and upon receipt by the Secured Party of all proceeds of such sale, transfer,
assignment, exchange or other disposition to the extent required to be remitted
to the Secured Party under the Indenture), such Collateral shall be released
from the Lien and security interest created hereunder in accordance with the
provisions of the Indenture and no longer constitute Collateral. Notwithstanding
the foregoing, the provisions of Section 7.06(b) hereof shall survive the
termination of this Agreement.
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Section 7.08 Release. Subject to the provisions of Section 7.06(b)
hereof, this Agreement shall terminate upon payment in full of (a) the Notes
under the terms of the Indenture and (b) all Obligations then due and owing
under the Indenture, the Notes and the Collateral Documents. At such time, the
Secured Party shall, at the request of the Pledgor, reassign and redeliver to
the Pledgor all of the Collateral hereunder that has not been sold, disposed of,
retained or applied by the Secured Party in accordance with the terms of the
Indenture or the Collateral Documents. Such reassignment and redelivery shall be
without warranty by or recourse to the Secured Party, except as to the absence
of any prior assignments by the Secured Party of its interest in the Collateral,
and shall be at the expense of the Pledgor.
Section 7.09 Counterparts, Effectiveness. This Agreement becomes
effective upon the execution hereof by Pledgor and delivery of the same to
Secured Party, and it is not necessary for Secured Party to execute any
acceptance hereof or otherwise signify or express its acceptance hereof.
Section 7.10 Interpretation of Agreement. To the extent a term or
provision of this Agreement conflicts with the Indenture, the Indenture shall
control with respect to the subject matter of such term or provision.
Section 7.11 Rights of Holders. No Holder of Notes shall have any
independent rights hereunder other than those rights granted to individual
Holders of Notes pursuant to the Indenture; provided that, nothing in this
Section 7.11 shall limit any rights granted to the Secured Party under the
Notes, the Indenture or the Collateral Documents.
Section 7.12 No Personal Liability of Directors, Officer, Employees,
and Stockholders. No past, present or future director, officer, employee,
incorporator or stockholder of the Pledgor, as such or any successor Person, as
such, shall have any liability for any obligations of the Pledgor under this
Agreement or for any claim based on, in respect of, or by reason of, such
Obligations or their creation.
Section 7.13 Trustee. State Street Bank and Trust Company is acting
hereunder solely in its capacity as Trustee under the Indenture, and all of the
rights of Trustee set forth in the Indenture shall apply to Trustee's actions
hereunder. To the extent this Agreement contemplates payments by the Secured
Party, the Trustee shall have no liability therefor, such liability continuing
to be the liability of Pledgor or realized through the value of any collateral
for the Obligations.
Section 7.14 Gaming Laws and Regulations. To the extent required under
applicable law, the consummation of the transactions contemplated hereby and the
exercise of remedies hereunder may be subject to the Louisiana Riverboat
Economic Development and Gaming Control Act, La. R.S. 27:41, et seq., and the
Louisiana Gaming Control Law, La. R.S. 27:1, and the regulations promulgated
pursuant to each such law, all as amended from time to time. The Gaming License
held by Hollywood Casino Shreveport is not part of the Collateral of this
Agreement and, under the above described legislation and rules promulgated
thereunder, the Trustee may be precluded from or otherwise limited in taking
possession of or in selling the Collateral of this Agreement under the defaults
and remedies provisions of this Agreement.
13
Due to various legal restrictions, including, without limitation, licensing of
operators of gaming facilities and prior approval of the sale or disposition of
assets of a licensed gaming operation, the sale of Collateral may be denied by
Gaming Authorities or delayed pending Gaming Authority approval.
[SIGNATURE PAGE FOLLOWS]
14
IN WITNESS WHEREOF, Pledgor has caused this Stock Pledge Agreement to
be executed as of the date first above written.
Pledgor: HWCC-LOUISIANA, INC., a Louisiana
corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
[SIGNATURE PAGE TO STOCK PLEDGE AGREEMENT]
S-1
EXHIBIT A
PLEDGED SECURITIES
Stock % of
Pledged Entity Class of Stock Certificate No. No. of Shares Outstanding
1. HCS I, Inc., a Common 1 1,000 100%
Louisiana corporation
2. HCS II, Inc., a Common 1 1,000 100%
Louisiana corporation
A-1