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EXHIBIT 4.49
HORSESHOE ENTERTAINMENT,
A LOUISIANA LIMITED PARTNERSHIP
INTERCOMPANY SENIOR SECURED NOTE DUE JUNE 15, 2000
$100,000,000 New York, New York
Note Number: HE-104 October 31, 1997
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FOR VALUE RECEIVED, Horseshoe Entertainment, a Louisiana Limited
Partnership (the "Company"), with its principal place of business located at ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, hereby promises to pay jointly,
severally and solidarily to the order of Horseshoe Gaming, L.L.C. (the "Payee"),
a Delaware limited liability company with its principal place of business
located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, or its registered
assigns, the principal amount of ONE HUNDRED MILLION DOLLARS ($100,000,000), or
such lesser amount as shall equal the aggregate unpaid principal amount of this
Note, and to pay interest thereon, as provided herein. This Note is referred to
herein individually as this "Note" and, collectively, together with any other
Notes which may be issued pursuant to Section 5 hereof, as the "Notes." Certain
capitalized terms used in this Note are defined in Section 12 below.
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THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR REGISTERED OR QUALIFIED UNDER ANY STATE SECURITIES LAWS.
THIS SECURITY MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS THE
PROPOSED TRANSACTION DOES NOT REQUIRE REGISTRATION OR QUALIFICATION UNDER
FEDERAL OR STATE SECURITIES LAWS OR UNLESS THE PROPOSED TRANSACTION IS
REGISTERED OR QUALIFIED AS REQUIRED.
THIS SECURITY IS SUBJECT TO REPURCHASE IF THE OWNERSHIP OF THIS
SECURITY BY ANY PERSON OR ENTITY WILL PRECLUDE, INTERFERE WITH, THREATEN OR
DELAY THE ISSUANCE, MAINTENANCE, EXISTENCE OR REINSTATEMENT OF ANY GAMING OR
LIQUOR LICENSE, OR PERMIT OR APPROVAL OF ANY GAMING AUTHORITY OR RESULT IN THE
IMPOSITION OF BURDENSOME TERMS ON SUCH LICENSE, PERMIT OR APPROVAL.
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1. Payments of Interest. Interest (computed on the basis of a
360-day year of twelve 30 day months) on the unpaid principal amount shall be
payable at the rate of 9.39% per annum from the date hereof, payable
semi-annually in arrears on each June 15 and December 15 of each year,
commencing on December 15, 1997, until said principal amount shall have become
due and payable.
2. Payments of Principal.
2.1 Optional Redemption. The Notes may not be redeemed, in whole
or in part, at any time at the option of the Company.
2.2 Maturity.
b. The outstanding principal balance of the Notes plus all
interest accrued thereon is due in full on June 15, 2000.
c. The Company will give written notice of any redemption of the
Notes pursuant to paragraph (a) of this Section 2.2 to the Holders of Notes not
less than 30 days, nor more than 60 days, prior to the date fixed for such
redemption in such notice, which notice shall specify the principal amount of
the Notes so to be redeemed, together with the amount of interest accrued
thereon, and the date fixed for such redemption.
2.3 Redemption Pursuant to Gaming Laws.
a. If the ownership of this Note by any person or entity will
preclude, interfere with, threaten or delay the issuance, maintenance, existence
or reinstatement of any gaming or liquor license, or permit or approval of any
Gaming Authority, or result in the imposition of burdensome terms or conditions
on such license, permit or approval, as determined by any Governmental Authority
or the general partner of the Company (including, without limitation, such
Holder failing to qualify or to be found suitable under applicable Gaming Laws),
such Holder shall be obligated, at the request of the Company, to dispose of
this Note (subject to any restrictions on the transfer of this Note set forth
herein or otherwise provided by applicable law and subject to any approvals by
any Gaming Authority that may be required) within thirty (30) days (or such
other time period required by any Gaming Authority) after receipt of notice of
such determination by any Governmental Authority or the general partner (in
which event the Company shall have no obligation to pay any interest to such
Holder), and if this Note is not so disposed of within the required period, the
Company shall have the right to redeem such Holder's Note at a redemption price
equal to the principal amount of this Note, without accrued interest, if
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any. Any Holder or beneficial owner of this Note that is required to qualify or
be found suitable under applicable Gaming Laws must pay all investigative fees
and costs of the Gaming Authorities in connection with such application
therefor.
b. Any redemption notice given by the Company under this Section
2.3 shall state (i) that this Note is being called for redemption as a result of
the Holder's or beneficial owner's status under the relevant Gaming Laws, (ii)
the redemption date, (iii) the redemption price and (iv) the place or places
where this Note is to be surrendered for payment of the redemption price.
3. Repurchase of Notes at the Option of the Holder Upon a Change
of Control.
a. In the event that a Change of Control has occurred, each
Holder of Notes will have the right to require the Company to repurchase all or
any part of such Holder's Notes on the date that is no later than thirty (30)
Business Days after the occurrence of such Change of Control (the "Change of
Control Payment Date"), at a cash price equal to one hundred one percent (101%)
of the principal amount thereof (the "Change of Control Offer Price"), plus
accrued and unpaid interest, if any, to and including the Change of Control
Payment Date.
b. In the event that, pursuant to this Section 3, the Company
shall be required to commence a Change of Control Offer, the Company shall
deliver a notice to each of the Holders, which shall govern the terms of any
Change of Control Offer and shall state:
(i) that the Change of Control Offer is being made
pursuant to this Section 3 and that all Notes or portions thereof tendered on or
prior to the Change of Control Payment Date will be accepted for payment;
(ii) the Change of Control Offer Price (including the
amount of accrued and unpaid interest) and the Change of Control Payment Date;
(iii) that any Note, or portion thereof, not tendered or
accepted for payment will continue to accrue interest;
(iv) that the tender of any Note, or portion thereof,
shall be irrevocable; and
(v) a brief description of the events resulting in such
Change of Control.
c. On the Change of Control Payment Date, the Company shall
redeem all Notes, or parts thereof, tendered in response to the Change of
Control Offer.
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4. Security Interest. The obligations of the Company under the
Notes are secured by (a) the Bossier City Mortgage encumbering all of the land
in Bossier City, Louisiana on which the Horseshoe Bossier City Casino is
located, all such other land owned by the Company which is included on an
exhibit to the Bossier City Mortgage and all personal property used in
connection with the Horseshoe Bossier City Casino and (b) the Bossier City
Preferred Ship Mortgage, granting a first priority security interest in the
Bossier City riverboat casino owned by the Company, (c) the Bossier City Second
Ship Mortgage, (d) the Bossier City Security Agreement and (e) the Bossier City
Second Security Agreement. Such security interests are being assigned for the
benefit of the holders of the Senior Secured Credit Facility Notes and, on a
subordinated basis, for the benefit of the holders of the Senior Notes.
5. Registration, Transfer and Exchange of Notes. The Company will
keep at its principal executive office a note register in which, subject to such
reasonable regulations as it may prescribe, but at its expense (other than
transfer taxes, if any), it will provide for the registration and transfer of
this Note.
This Note may not be sold, transferred, pledged or hypothecated
unless the proposed transaction does not require registration or qualification
under the Securities Act or an applicable state securities or blue sky law or
unless an exemption from such registration is available. The transferor of this
Note shall be required to deliver an opinion as to the applicable exception in
connection with any such transfer. The transferee of this Note shall be required
to deliver an acknowledgement of Section 2.3.
The Company shall not be required to register any transfer of
this Note if the Company reasonably believes such transferee would not be
approved as a transferee by the relevant Gaming Authority.
The Holder of this Note, at such Holder's option, may surrender
the same for transfer or exchange either at the principal executive office of
the Company or at the place of payment named herein, accompanied in the case of
a transfer or assignment by a written instrument of transfer or assignment in
form satisfactory to the Company duly executed by the registered Holder thereof
or by such Holder's attorney duly authorized in writing. In case any Holder
shall so request the transfer, assignment or exchange of this Note, the Company,
at its expense, will execute and deliver (in each case insured to your
reasonable satisfaction) in exchange therefor one or more new Notes, as may be
requested by such Holder, in the same aggregate unpaid principal amount as the
aggregate unpaid principal amount of the Note or Notes so surrendered. Any Note
issued in exchange for any other Note or upon transfer thereof shall carry the
rights to unpaid interest and interest to accrue which were carried by the Note
so exchanged or transferred, and neither gain nor loss of interest shall result
from any such transfer or exchange. Notwithstanding the foregoing, Notes may not
be issued in denominations of less than $50,000 (except if the entire
outstanding principal balance of the Notes of such Holder is less than $50,000,
in which case one Note for the entire outstanding principal amount of the Notes
of such Holder may be issued).
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The Company and any agent of the Company may treat the Holder in
whose name any Note is registered as the owner of such Note for the purpose of
receiving payment of the principal of and premium (if any) and interest on such
Note and for all other purposes whatsoever, whether or not such Note be overdue.
Notwithstanding anything contained herein to the contrary, the
provisions of this Section 5 shall not apply in connection with any of the
transactions contemplated by the HG Note Assignment.
6. Representations of the Company. The Company represents and
warrants to you as follows:
6.1 Organization and Authority. The Company is a limited
partnership duly organized, validly existing and in good standing under the laws
of the State of Louisiana. The Company has the requisite power and authority to
own or hold under lease the property it purports to own or hold under lease and
to transact the business it transacts and proposes to transact. The Company has
the requisite power and authority to execute and deliver this Note and the other
documents and agreements contemplated hereby to be executed and delivered by the
Company, and to perform the provisions hereof and thereof to be performed by the
Company. The Company is duly qualified and is in good standing in each
jurisdiction in which the character of the properties owned or held under lease
by it or the nature of the business transacted by it requires such
qualification, except where the failure to so qualify would not have a Material
Adverse Effect.
The execution, delivery and performance of this Note and the
other Operative Documents and any other documents or agreements contemplated
hereby and thereby, and the consummation of the transactions contemplated hereby
and thereby, have been duly authorized and approved by the Company and each is
the valid and binding obligation of the Company, enforceable in accordance with
its terms, except as may be limited by applicable bankruptcy, reorganization,
insolvency, moratorium or other similar laws or by legal or equitable principles
relating to or limiting creditors' rights generally or as rights to
indemnification may be limited by applicable securities laws.
6.2 Ownership of the Company. Except as set forth on Schedule
6.2, on the date hereof, NGCP will be the only general partner of the Company
and the persons named on Schedule 6.2 will be the only limited partners of the
Company. The partnership interests of NGCP and the limited partners in the
Company have been duly authorized and validly issued and all required
contributions in respect of all such partnership interests have been made.
Except as set forth on Schedule 6.2, the Company has no
outstanding securities convertible into or exchangeable for any interests in the
Company or any rights to subscribe for or to purchase, or any options for the
purchase of, or any agreements (contingent or otherwise) providing for the
issuance of, or any calls, commitments or claims of any character relating to,
any interest in the Company or any securities convertible into or exchangeable
for any interest in
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the Company. Except as set forth on Schedule 6.2, the Company is not subject to
any obligation (contingent or otherwise) to repurchase or otherwise acquire or
retire any interest in the Company or obligation evidencing the right of the
Holder thereof to purchase any interest in the Company.
6.3 Subsidiaries. Except as set forth on Schedule 6.3, the
Company does not have any Subsidiaries and does not have any equity interest in
any other entity.
6.4 Litigation; Observance of Statutes, Regulations and Orders.
Except as disclosed on Schedule 6.4, there are no actions, suits or proceedings
pending or, to the knowledge of the Company, threatened, against or affecting
the Company or any property of the Company or any of the partners of the Company
in any court or before any arbitrator of any kind or before or by any
Governmental Body (except actions, suits or proceedings arising in the ordinary
course of business which individually or in the aggregate, if adversely
determined, would not cause a Material Adverse Effect).
Except as set forth on Schedule 6.4, the Company is not in
default under any Order of any court, arbitrator or Governmental Body, and is
not subject to or a party to any Order of any court or Governmental Body arising
out of any action, suit or proceeding under any statute or other law. The
Company is not in violation of any statute or other rule or regulation of any
Governmental Body, the violation of which could cause a Material Adverse Effect.
6.5 Title to Property; Leases. On the date hereof, the Company
will have good, marketable and insurable title to the real properties owned by
the Company including, without limitation, good, marketable and insurable title
to the real properties which are the subject of the Bossier City Mortgage,
except for Permitted Liens which do not interfere with the intended use of the
property. All real property owned by the Company is reflected on Schedule 6.5.
On the date hereof, the Company enjoys full and undisturbed
possession under all leases necessary in any material respect for the operation
of the business of the Company, each of which is listed on Schedule 6.5 (the
"Leases"). None of the Leases contain any unusual or burdensome provisions
which, individually or in the aggregate, could materially impair the operation
of the business of the Company. Schedule 6.5 sets forth a correct and complete
list of all Leases of the Company existing on the Closing Date. The Leases are
valid and subsisting and are in full force and effect and the Company is not in
default on any of the terms and obligations of any Lease, and no event over the
passage of time shall constitute such default.
6.6 Taxes. Except as set forth on Schedule 6.6, the Company has
filed all tax returns which are required to have been filed in any jurisdiction,
and has paid all material taxes including, but not limited to, real estate taxes
shown to be due and payable on such returns and all other taxes and assessments
payable by the Company, to the extent the same have become due and payable and
before they have become delinquent, except for any taxes and assessments the
amount, applicability or validity of which is currently being contested in good
faith by
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appropriate proceedings and with respect to which the Company has set aside on
its books reserves (to the extent required by GAAP) deemed by it to be adequate.
Except as set forth in Schedule 6.6, the Company does not know of any proposed
tax assessment against the Company. The tax returns filed by the Company are
true, complete and accurate in all material respects and all tax liabilities are
adequately provided for on the books of the Company. Except as set forth on
Schedule 6.6, there are no tax certiorari proceedings pending in connection with
the real properties which are the subject of the Bossier City Mortgage.
6.7 Compliance with Laws and Other Instruments.
a. Except as disclosed on Schedule 6.7, the consummation of the
transactions contemplated by this Note and the execution, delivery and
performance of the terms and provisions of this Note and the Bossier City
Mortgage, will not (i) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien in respect of any property
of the Company under (x) any indenture, mortgage, deed of trust, bank loan or
credit agreement, License or other material agreement or instrument to which the
Company is a party or by which the Company or any of its properties may be bound
or affected or (y) the organizational documents of the Company or (ii) conflict
with or result in a breach of any of the terms, conditions or provisions of any
Order of any court, arbitrator or Governmental Body applicable to the Company or
(iii) violate any provision of any statute or other rule or regulation of any
Governmental Body applicable to the Company, the violation of which would have a
Material Adverse Effect.
b. The Company is not in violation of any law, rule, regulation,
Order, indenture, mortgage, deed of trust, bank loan, credit agreement, License
or other agreement or instrument to which the Company is a party or by which the
Company or any of its properties may be bound or affected, which violation would
have a Material Adverse Effect.
c. The Company has all licenses required under any Gaming Law in
connection with the operation of the Horseshoe Bossier City Casino, including,
without limitation, the Louisiana License. Except as set forth on Schedule 6.7,
all such licenses are in full force and effect and no action has been taken by
any party to appeal, review, amend or revoke any such license.
6.8 Consents. Except as disclosed on Schedule 6.8, no consent,
approval or authorization of, or registration, filing or declaration with or
delivery of notice to, any Governmental Body or any third party (including, but
not limited to, the Leases) is required for the validity, execution and delivery
or for the performance by the Company of this Note and the other Operative
Documents, except for filings required by Federal or state securities laws and
the filings and recordings required to perfect the Bossier City Mortgage.
6.9 Intellectual Property; Licenses. Schedule 6.9 lists each
trademark, service ▇▇▇▇, trade name, brand, copyright, patent, patent
application and right with respect to any of the foregoing (collectively, the
"Intellectual Property") owned, licensed or used by the Company in
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the conduct of its business. The Company owns or possesses the right to use each
item of its Intellectual Property. Except as set forth in Schedule 6.9, the
Company does not know of any conflict with any right of any other Person with
respect to any of the Intellectual Property. The Company has not received any
notice of (and no executive officer of the Company or its Affiliates is
otherwise aware of) any conflict with respect to any of the Intellectual
Property. The Company is not a party to or bound by any license or other
agreement with respect to any of the Intellectual Property, except as set forth
in Schedule 6.9. Schedule 6.9 also lists each license, franchise, permit or
other authorization (collectively, the "Licenses" and individually, a "License")
which is necessary for the conduct of the business of the Company and briefly
describes each License, including the licensor, royalty payments, fees or other
payment obligations, the terms of the License and the expiration date thereof.
Except as set forth in Schedule 6.9, the Company has obtained and complied in
all material respects with all of the provisions of each License held by such
Person. Except as set forth in Schedule 6.9, each License is valid and in full
force and effect. The continuation, validity and effectiveness of each item of
Intellectual Property and each License will in no way be affected by the
execution and delivery of this Note or the other Operative Documents or the
consummation of the transactions contemplated hereby or thereby. The Company has
not breached any material provision of, and is not in default in any material
respect under the terms of, and has not engaged in any activity that would cause
the revocation, termination or suspension of, any License, and no action or
proceeding seeking the revocation or suspension of any License is pending or, to
the knowledge of the Company, threatened. There is no material default or
claimed or purported or alleged material default or state of facts that with
giving of notice or the lapse of time or both would constitute a default on the
part of any party under any contract or arrangement with respect to any of the
Intellectual Property or Licenses.
6.10 Compliance with ERISA. Schedule 6.10 identifies each
"employee benefit plan", as defined in Section 3(3) of ERISA, currently
maintained for the benefit of, or related to any or all of the employees or
former employees of the Company or any ERISA Affiliate (the "Employee Plans").
Each of the Employee Plans is in compliance, in form and operation, with the
requirements of ERISA and the Code, and all other applicable Federal, state and
local statutes, orders, rules or regulations. No Employee Plan constitutes a
Multiemployer Plan. No "prohibited transaction", as defined in Section 406 of
ERISA or 4975 of the Code, has occurred with respect to any Employee Plan which
has or will make the Company or any employee of the Company liable for any tax
or penalty pursuant to Section 502 of ERISA or Section 4975 of the Code. All
applicable contributions to all Employee Plans have been made or will be made
when due. Neither the Company, nor any ERISA Affiliate of the Company has
incurred (i) any "accumulated funding deficiency", within the meaning of Section
412 of the Code or Section 302 of ERISA, or (ii) any liability to the PBGC or
any Multiemployer Plan under Title IV of ERISA.
6.11 Environmental Laws. Except as set forth on Schedule 6.11, to
the knowledge of the Company, the Company (i) has no liability under any
applicable environmental or health and safety-related law, regulation, rule,
ordinance, or legally enforceable requirement at the Federal, state, or local
level (each an "Environmental Law") or common law cause of action
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relating to or arising from environmental conditions which is reasonably likely
to have a Material Adverse Effect and any facilities and operations of the
Company comply with and will continue to comply with all applicable
Environmental Laws to the extent that failure to comply is reasonably likely to
have a Material Adverse Effect; (ii) is not subject to any outstanding judgment,
consent decree, compliance order, or administrative order with respect to any
environmental or health and safety matter or received any written request for
information, notice, demand letter, administrative inquiry, or formal or
informal complaint or claim with respect to any environmental or health and
safety matter or the enforcement of any Environmental Law which if adversely
determined, is reasonably likely to have a Material Adverse Effect; and (iii)
has no reason to believe that any of the items enumerated in clause (ii) of this
paragraph will be forthcoming. Except as set forth on Schedule 6.l1, to the
knowledge of the Company: (i) the Company has never and will never generate,
transport, use, store, treat, dispose of, or manage any hazardous waste as
defined or regulated under any Environmental Law ("Hazardous Waste"), except in
accordance with applicable Environmental Laws and except to the extent that
failure to comply with applicable Environmental Laws is not reasonably likely to
have a Material Adverse Effect; (ii) the Company is not aware of and has not
caused any release or threat of release of a hazardous waste, hazardous
material, hazardous substance, petroleum product, oil, toxic substance,
pollutant, contaminant, or other human health or safety, as defined or regulated
under any Environmental Law ("Hazardous Material") at any site presently or
formerly owned, operated, or leased by the Company except in accordance with
applicable Environmental Laws, and except to the extent that failure to comply
with applicable Environmental Laws is not reasonably likely to have a Material
Adverse Effect; (iii) the Company has never had Hazardous Material transported
from any site presently or formerly owned, operated or leased by the Company for
treatment, storage, or disposal at any other place, except in accordance with
applicable Environmental Laws and except to the extent that failure to comply
with applicable Environmental Laws is not reasonably likely to have a Material
Adverse Effect; (iv) the Company does not presently own, operate, lease or use
any site on which underground storage tanks are or were located except where the
presence and/or removal of such underground storage tanks is not reasonably
likely to have a Material Adverse Effect; (v) the Company has never placed
underground tanks on any site owned, operated, leased or used by the Company
except where the presence and/or removal of such underground storage tanks is
not reasonably likely to have a Material Adverse Effect; (vi) the Company has
never removed underground tanks from any site presently or formerly owned,
operated, leased or used by the Company except where the presence and/or removal
of such underground storage tanks is not reasonably likely to have a Material
Adverse Effect; and (vii) the Company has never had a Lien imposed by any
Governmental Body on any property, facility, machinery, or equipment currently
owned, operated or leased by the Company in connection with the presence of any
Hazardous Material.
6.12 Solvency. As of the date hereof, after giving effect to the
transactions contemplated by this Note and the other Operative Documents and the
other transactions related hereto and thereto, and the payment of fees and
expenses in connection therewith, the Company in good faith after due inquiry
believes that:
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a. The fair market going concern value of all of the assets
(including goodwill), of the Company (that is, the amount which could be
realized for the Company within a reasonable time, either through collection or
sale of such assets as a going concern at the regular market value) will be
greater than the total amount of liabilities, including contingent,
subordinated, absolute, fixed, matured or unmatured and liquidated or
unliquidated liabilities, of the Company.
b. The fair market going concern value of all of the assets
(including goodwill), of the Company (that is, the amount which could be
realized for the Company within a reasonable time, either through collection or
sale of such assets as a going concern at the regular market value) is
sufficient to pay the probable liability of the Company on its existing debts as
such debts become absolute and matured. The Company currently pays and expects
it will be able to pay its debts and other liabilities, contingent obligations
and other commitments as they mature or come due in the normal course of
business.
c. The Company is not engaged in, or is about to engage in,
business or transactions for which it has unreasonably small capital.
No transfer of property is being made and no obligation is being
incurred in connection with the transactions contemplated by this Note, the
other Operative Documents or any other document contemplated herein or therein
with the intent to hinder, delay or defraud either present or future creditors
the Company.
7. Covenants. The Company covenants and agrees that on and after
the date hereof, so long as any Note shall be outstanding or any amount shall be
due and unpaid thereunder:
7.1 Maintenance of Existence. Except to the extent that failing
to do so is not prohibited by the Senior Secured Credit Facility Note Purchase
Agreement and the Indenture, the Company shall do or cause to be done all things
necessary to preserve and keep in full force and effect its existence in
accordance with, respectively, the rights (charter and statutory), Licenses and
franchises of the Company; provided, however, that the Company shall not be
required to preserve any such right, License or franchise if the Company shall
determine that the preservation thereof is no longer desirable in the operation
of the business of the Company and that the loss thereof is not adverse in any
respect to the Holders of the Notes.
7.2 Payment of Taxes and Other Claims. The Company shall, and
shall cause each of its Subsidiaries to, pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all taxes, assessments
and governmental charges (including withholding taxes and any penalties,
interest and additions to taxes) levied or imposed upon the Company or any of
its Subsidiaries or properties and assets of the Company or any of its
Subsidiaries and (ii) all lawful claims, whether for labor, materials, supplies,
services or anything else, that have become due and payable and that by law have
or may become a Lien upon the property and assets of the Company or any of its
Subsidiaries; provided, however, that the
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Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate proceedings and for
which disputed amounts adequate reserves have been established in accordance
with GAAP.
7.3 Maintenance of Insurance. From and at all times after the
date hereof, the Company and its Subsidiaries shall have in effect customary
property and comprehensive general liability insurance, in each case in
compliance with the terms and conditions of the Bossier City Mortgage, the
Bossier City Preferred Ship Mortgage and the Bossier City Second Ship Mortgage
and, in any event, on terms and in an amount reasonably sufficient (taking into
account, among other factors, the creditworthiness of the insurer) to avoid a
Material Adverse Effect.
7.4 Maintenance of Properties. Except to the extent that failure
to do so is not prohibited by the Senior Secured Credit Facility Note Purchase
Agreement and the Indenture, the Company shall, and shall cause each of its
Subsidiaries to, maintain, preserve, protect and keep the properties material to
the operation of the business of the Company and each of its Subsidiaries in
good repair, working order and condition (ordinary wear and tear excepted), and
make necessary and proper repairs, renewals and replacements so that its
business carried on in connection therewith may be properly conducted at all
times consistent with past practices of the Company and such Subsidiaries.
7.5 Compliance with ERISA. The Company shall not, nor shall the
Company permit any ERISA Affiliate to (a) engage in any transaction in
connection with which the Company could be subject to either a material penalty
or excise tax imposed by ERISA or the Code, (b) terminate or withdraw from any
Employee Plan (other than a Multiemployer Plan) in a manner which could result
in any material liability to the Company to the PBGC, (c) fail to make full
payment when due of all material amounts which, under the provisions of any
Employee Plan, the Company is required to make as contributions thereto, or (d)
permit to exist any material accumulated funding deficiency with respect to any
Employee Plan.
7.6 Compliance with Environmental Laws. The Company shall, and
shall cause each of its Subsidiaries to, at all times maintain in full force and
effect all material licenses and permits which are required under applicable
Environmental Laws in connection with the conduct of the business or operations
of the Company and its Subsidiaries. Each of the Company and its Subsidiaries
shall at all times remain in compliance with the terms and conditions of all
such licenses and permits and with all Environmental Laws, except where the
failure to comply is not reasonably likely to have a Material Adverse Effect.
7.7 Limitation on Liens. The Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly create, receive,
assume or permit to exist or otherwise cause or permit to become in effect any
Lien, other than those which are permitted under the Senior Secured Credit
Facility Note Purchase Agreement, the Indenture and the Bossier City Mortgage.
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7.8 Compliance with Laws. The Company shall at all times maintain
in full force and effect the Louisiana License and all other licenses and
permits which are required under gaming laws in Louisiana and the United States
and comply, and cause each of its Subsidiaries to comply, with all other
applicable laws, rules, regulations (provided this covenant shall not be deemed
to have been breached in respect of the non-compliance with any such other law,
rule or regulation if such non-compliance in the aggregate would not cause a
Material Adverse Effect) and Orders; such compliance to include, without
limitation, compliance with ERISA and the Racketeer Influenced and Corrupt
Organizations Chapter of the Organized Crime Control Act of 1970.
8. Events of Default; Remedies.
8.1 Events of Default Defined; Acceleration of Maturity. If any
of the following events ("Events of Default") shall occur and be continuing (for
any reason whatsoever and whether it shall be voluntary or involuntary or by
operation of law or otherwise):
a. default shall be made in the payment of the principal of this
Note when and as the same shall become due and payable, whether at stated
maturity, by acceleration, by mandatory redemption or otherwise;
b. default shall be made in the payment of any interest on this
Note when and as such interest shall become due and payable, and such default
shall have continued for a period of thirty (30) days; or
c. default shall be made in the performance or observance of any
covenant, agreement or condition contained in this Note and such default shall
have continued unremedied for a period of thirty (30) days or such longer period
(but in no event longer than a total of sixty (60) unremedied days) during which
the Company is diligently pursuing a remedy to such default; or
d. a default in the payment of principal, premium or interest
when due that extends beyond any stated period of grace applicable thereto or an
acceleration for any other reason of the maturity of any Indebtedness of the
Company or any of its Subsidiaries (other than Indebtedness of the Company to
any Subsidiary of HG or of a Subsidiary of the Company to the Company or another
Subsidiary of HG) with an aggregate principal amount in excess of ten million
dollars ($10,000,000); or
e. an order for relief shall be entered in a proceeding under the
Bankruptcy Code in respect of the Company; a decree, judgment or order by a
court of competent jurisdiction shall have been entered adjudging the Company or
any of its Subsidiaries that individually or as a group constitute a Significant
Subsidiary, as bankrupt or insolvent; or such decree, judgment or order shall
have been entered approving as properly filed a petition seeking reorganization
of the Company or such Significant Subsidiary under any bankruptcy or similar
law, and such decree or order shall have continued undischarged and unstayed for
a period of sixty (60) days; or a decree
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or order of a court of competent jurisdiction over the appointment of a
receiver, liquidator, trustee or assignee in bankruptcy or insolvency of the
Company or such Significant Subsidiary, or of the property of any such person,
or for the winding up or liquidation of the affairs of any such person, shall
have been entered, and such decree, judgment or order shall have remained in
force undischarged and unstayed for a period of sixty (60) days; or
f. the Company or any of its Subsidiaries that individually or as
a group constitute a Significant Subsidiary, shall institute proceedings to be
adjudicated a voluntary bankrupt, or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent seeking
reorganization under, any bankruptcy or similar law or similar statute, or shall
consent to the filing of any such petition, or shall consent to the appointment
of a custodian, receiver, liquidator, trustee or assignee in bankruptcy or
insolvency of it or any of its assets or property, or shall make a general
assignment for the benefit of creditors, or shall admit in writing its inability
to pay its debts generally as they become due, or shall, within the meaning of
any Bankruptcy Law, become insolvent or fail generally to pay its debts as they
become due; or
g. final, non-appealable, unsatisfied judgments not covered by
insurance aggregating in excess of one million dollars ($1,000,000), at any one
time being rendered against the Company or any of its Subsidiaries and not
stayed, bonded or discharged within sixty (60) days; or
h. for any reason, the Holders shall cease to hold, pursuant to
the Bossier City Mortgage, a valid enforceable mortgage and security interest in
and to the Mortgaged Property (as defined in the Bossier City Mortgage) subject
to no prior lien, mortgage or security interest in favor of any third party,
except as permitted in Bossier City Mortgage; provided, however, if the
potential detrimental effect on the Holders in the case of a lien, mortgage or
security interest in favor of a third party is covered by title insurance, then
such lien, mortgage or security interest shall only constitute an Event of
Default hereunder if such lien, mortgage or security interest shall have
continued unremoved for a period of thirty (30) days or such longer period (but
in no event longer than a total of sixty (60) unremedied days) during which the
Company is diligently pursuing a remedy to such default; or
i. the legal right of the Company to operate the gaming
establishment within any Horseshoe Bossier City Casino is suspended or lost and
such loss or suspension shall continue for more than thirty (30) consecutive
days.
then upon the occurrence of any Event of Default, the Majority Noteholders by
written notice to the Company, may declare the unpaid principal amount of all
Notes to be, and the same shall forthwith become, due and payable, together with
the interest accrued thereon and all other amounts payable by the Company
hereunder, provided, during the existence of an Event of Default under clause
(a) or (b) of this Section 8.1 with respect to any Note, the Holder of such
Note, by written notice to the Company, may declare such Note to be, and the
same shall forthwith become, due and payable, together with the interest accrued
thereon and all other
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amounts payable by the Company hereunder. If any Holder of any Note shall
exercise the option specified in the proviso to the preceding sentence, the
Company will forthwith give written notice thereof to the Holders of all other
outstanding Notes and each such Holder (whether or not such notice is given or
received), by written notice to the Company, may declare the principal of all
Notes held by it to be, and the same shall forthwith become, due and payable,
together with the interest accrued thereon and all other amounts payable by the
Company hereunder. Notwithstanding the foregoing, the unpaid principal amount of
the Notes may not be accelerated pursuant to an Event of Default described in
subsection d if prior to such acceleration, all amounts due under such other
indebtedness as described in such subsection shall have been repaid.
The provisions of this Section are subject, however, to the
condition that if, at any time after any Note shall have so become due and
payable, the Company shall pay all arrears of interest on such Note and all
payments on account of the principal on such Note and any other amounts owing
which shall have become due otherwise than by acceleration (with interest on
such principal, and, to the extent permitted by law, on overdue payments of
interest, at the rate specified in the Notes) and all Events of Default (other
than nonpayment of principal of and accrued interest on Notes, due and payable
solely by virtue of acceleration) shall be remedied or waived pursuant to
Section 9, then, and in every such case, the Majority Noteholders, by written
notice to the Company, may rescind and annul any such acceleration and its
consequences; but no such action shall affect any subsequent Event of Default or
impair any right consequent thereon.
9. Amendment and Waiver. a. Any term, covenant, agreement or
condition of the Notes, with the consent of the Company may be amended, or
compliance therewith may be waived (either generally or in a particular instance
and either retroactively or prospectively), by one or more substantially
concurrent written instruments signed by the Majority Noteholders; provided,
however, that
(i) no such amendment or waiver shall
(x) reduce the principal of, or reduce the rate of or
change the time for payment of interest on or any premium payable
with respect to, any Note, or extend the maturity of any Note,
without the consent of the Holder of each Note so affected, or
(y) modify any of the provisions of the Notes with respect
to the payment or prepayment thereof, or reduce the percentage of
Holders of Notes required to approve any such amendment or
effectuate any such waiver, or amend this Section 9 without the
consent of the Holders of all of the Notes at the time
outstanding; and
(ii) no such waiver shall extend to or affect any obligation not
expressly waived or impair any right consequent thereon; and
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provided, further, until the pledge of the Notes under the HG Note Assignment
has been released, no action may be taken by the Majority Noteholders or at
their direction or pursuant to their consent by the Company or the Majority
Noteholders under the Notes without the consent of the pledgees under the HG
Note Assignment.
b. Any amendment or waiver pursuant to subsection (a) of this
Section 9 shall apply equally to all the Holders of the Notes and shall be
binding upon them, upon each future holder of any Note and upon the Company, in
each case whether or not a notation thereof shall have been placed on any Note.
c. So long as any outstanding Notes are owned by the Payee or any
other Holder, the Company will not solicit, request or negotiate for or with
respect to any proposed waiver or amendment of any of the provisions of the
Notes unless each Holder of any Note (irrespective of the amount of Notes then
owned by it) shall be informed thereof by the Company and shall be afforded the
opportunity of considering the same and shall be supplied by the Company with
sufficient information to enable it to make an informed decision with respect
thereto. Executed or true and correct copies of any amendment or waiver effected
pursuant to the provisions of this Section 9 shall be delivered by the Company
to each Holder of outstanding Notes forthwith following the date on which the
same shall have been executed and delivered as set forth herein.
10. Notices. All notices and other communications provided for in
this Note shall be in writing and delivered, telecopied or mailed, first class
postage prepaid, addressed:
(i) if to the Company:
HORSESHOE ENTERTAINMENT,
A LOUISIANA LIMITED PARTNERSHIP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
(ii) if to the Payee, at the address set forth on the first
page of this Note or at such other address as the Payee may
hereafter designate by notice to the Company, and
(iii) if to any other Holder of the Notes, at the address of
such Holder as it appears on the note register.
Any such notice or communication shall be deemed to have been duly given
when delivered or telecopied and, if mailed, two days after deposit in the U.S.
mail.
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11. Remedies Cumulative. No remedy herein conferred upon the
Holder of this Note is intended to be exclusive of any other remedy and each and
every such remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in equity or by
statute or otherwise.
12. Definitions. Except as otherwise specified or as the context
may otherwise require, the following terms shall have the respective meanings
set forth below when used in this Note:
"Affiliate" means (i) any person directly or indirectly
controlling or controlled by or under direct or indirect common control with HG
or any of its Subsidiaries, including, without limitation, ▇▇▇▇ ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇▇▇▇, (ii) any spouse, immediate family member or other relative as any
person described in clause (i) above, (iii) any trust in which any person
described in clause (i) or (ii) above has a beneficial interest, and (iv) any
trust established by any person described in clause (i) or (ii) above, whether
or not such person has a beneficial interest in such trust. For purposes of this
definition, the term "control" means (a) the power to direct the management and
policies of a person, directly or through one or more intermediaries, whether
through the ownership of voting securities, by contract or otherwise, or (b) the
beneficial ownership of 10% or more of any class of voting Capital of an entity,
unless some other person beneficially owns a greater percentage of any class of
voting Capital of such entity.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal, state or foreign law for the relief of debtors.
"beneficial owner" for purposes of the definition of Change of
Control has the meaning attributed to it in Rules 13d-3 and 13d-5 under the
Exchange Act, whether or not applicable, except that a "person" shall be deemed
to have "beneficial ownership" of all shares that any such person has the right
to acquire, whether such right is exercisable immediately or only after the
passage of time.
"Board of Managers" means, with respect to any person that is a
limited liability company, the Board of Managers of such person, acting as a
group, or any committee of the Board of Managers of such person authorized, with
respect to any particular matter, to exercise the power of the Board of
Managers.
"Bossier City Mortgage" shall mean a first mortgage encumbering
all of the land in Bossier City, Louisiana on which the Horseshoe Bossier City
Casino is located, and all other land owned by the Company, as the same may be
amended or modified from time to time in accordance with its terms.
"Bossier City Preferred Ship Mortgage" shall mean the preferred
ship mortgage on the Bossier City riverboat casino owned by the Company, as the
same may be amended or modified from time to time in accordance with its terms.
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"Bossier City Second Security Agreement" means the financing
statement and second security agreement, dated as of October 10, 1995, executed
by the Company in favor of HG, as the same may be amended from time to time in
accordance with its terms.
"Bossier City Second Ship Mortgage" means the Second Ship
Mortgage, executed by the Company in favor of HG, as the same may be amended
from time to time in accordance with its terms.
"Bossier City Security Agreement" means the financing statement
and security agreement, dated as of October 10, 1995, executed by the Company in
favor of HG, as the same may be amended from time to time in accordance with its
terms.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday that is not a day on which banking institutions in New York, New York
are authorized or obligated by law or executive order to close.
"Capital" means (i) with respect to any corporation, any and all
shares of stock issued by that corporation and (ii) with respect to any other
person, any partnership interest, joint venture interest, limited liability
company member interest or other form of equity sharing or participation
interest, as applicable.
"Capitalized Lease Obligation" shall mean any obligation payable
under a lease of real or personal property to the extent such obligation, in
accordance with GAAP, should be capitalized on the lessee's balance sheet or for
which the amount of the asset and liability thereunder as if so capitalized
should be disclosed in a note to such balance sheet.
"Change of Control" means (i) prior to the completion of a bona
fide underwritten initial public offering by HG, the failure at any time of
Excluded Persons as a group to own and control at least 40% of the issued and
outstanding issued and outstanding Capital of HG; (ii) after the completion of a
bona fide underwritten initial public offering by HG, the acquisition, in one or
more transactions, of beneficial ownership by (A) any person or entity (other
than an Excluded Person) or (B) any group of persons or entities (excluding any
group in which Excluded Persons beneficially own in the aggregate at least 75%
of the equity and voting interests beneficially owned by the group) who
constitute a group (within the meaning of Section 13(d)(3) of the Exchange Act),
in either case, of Capital of HG such that, as a result of such acquisition,
such person, entity or group beneficially owns (within the meaning of Rule 13d-3
under the Exchange Act), directly or indirectly, 30% or more of the voting
Capital of HG entitled to vote in the election of directors, managers, general
partners or other similar governing bodies of HG then outstanding; provided,
however, that no Change of Control shall be deemed to have occurred if (A)
Excluded Persons beneficially own, in the aggregate, at such time, a greater
percentage of voting Capital of HG entitled to vote in the election of
directors, managers, general partners or other similar governing bodies of HG
than such other person, entity or group or (B) at the time of such acquisition,
Excluded Persons (or any of them) possess the ability (by contract or otherwise)
to elect, or cause the election, of a majority of the members of HG's Board of
Managers; (iii) any
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merger or consolidation of HG with or into any person or any sale, transfer or
other conveyance, whether direct or indirect, of all or substantially all of the
assets of HG, on a consolidated basis, in one transaction or a series of related
transactions, if immediately after giving effect to such transaction or
transactions, any person or group (other than Excluded Persons or groups
including Excluded Persons to the extent contemplated by clause (i) or (ii)
above, whichever is then applicable) is or becomes the beneficial owner,
directly or indirectly, of more than the percentage of the Capital of HG
contemplated by clause (i) or (ii) above, whichever is then applicable; or (iv)
during any period of 12 consecutive months after October 10, 1995, individuals
who at the beginning of any such 12-month period constituted the Board of
Managers of HG (together with any new managers whose election by such Board or
whose nomination for election by the members of HG was approved by a vote of a
majority of the managers then still in office who were either managers at the
beginning of such period or whose election or nomination for election was
previously so approved), cease for any reason to constitute a majority of the
managers of HG then in office.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"ERISA Affiliate" shall mean any corporation that is a member of
the same controlled group of corporations (within the meaning of Section 414(b)
of the Code) as the Company or any corporation or trade or business that is
under common control (within the meaning of Section 414 (c) of the Code) with
the Company or, solely for purposes of liability under Section 412 of the Code
or Section 302 of ERISA, any entity treated as a single employer with the
Company under Section 414(m) or (o) of the Code.
"Employee Plans" shall have the meaning ascribed thereto in
Section 6.10.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the Securities and
Exchange Commission thereunder.
"Excluded Person" means (a) HG or any Subsidiary of HG, (b) any
employee benefit plan of HG or any trustee or similar fiduciary holding Capital
of HG for or pursuant to the terms of any such plan, (c) ▇▇▇▇ ▇▇▇▇▇▇, (d)
▇▇▇▇▇▇▇ ▇▇▇▇ and (e) members of the families and Affiliates (where the
determination of whether a person is an Affiliate is made without reference to
clause (b) of the definition of such term) of the foregoing persons.
"GAAP" shall mean generally accepted accounting principles as in
effect on the date hereof.
"Gaming Authority" means any Governmental Authority with the
power to regulate gaming in any Gaming Jurisdiction, and the corresponding
Governmental Authorities
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with the responsibility to interpret and enforce the laws and regulations
applicable to gaming in any Gaming Jurisdiction.
"Gaming Jurisdiction" means any Federal, state or local
jurisdiction in which the Company or any entity in which the Company has a
direct or indirect beneficial, legal or voting interest conducts casino gaming,
now or in the future.
"Gaming Law" means any law, rule, regulation or ordinance
governing gaming activities (including, without limitation, the Louisiana
Riverboat Economic Development and Gaming Control Act, in each case including
all amendments or modifications thereof), any administrative rules or
regulations promulgated thereunder, and any of the corresponding statutes, rules
and regulations in each Gaming Jurisdiction.
"Governmental Authority" means any agency, authority, board,
bureau, commission, department, office or instrumentality of any nature
whatsoever of the United States or a foreign government, any state, any province
or any city or other political subdivision or otherwise and whether now or
hereafter in existence, or any officer or official thereof, and any maritime
authority.
"Governmental Body" shall mean any Federal, State, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, foreign or domestic.
"HG" means Horseshoe Gaming, L.L.C., a Delaware limited
liability company.
"HG Note Assignment" means the Note Assignment, executed as of
October 10, 1995, by HG in favor of the holders of the Senior Secured Credit
Facility Notes and United States Trust Company of New York, as Collateral Agent
for the benefit of the holders of the Senior Notes.
"Holder" or "Holders" shall mean the holder or holders of this
Note.
"Horseshoe Bossier City Casino" shall mean the dockside casino
owned by the Company in Bossier City/Shreveport, Louisiana.
"Indebtedness" of any person means, without, duplication, (a) all
liabilities and obligations, contingent or otherwise, of such person, (i) in
respect of borrowed money (whether or not the recourse of the lender is to the
whole of the assets of such person or only to a portion thereof), (ii) evidenced
by bonds, notes, debentures or similar instruments, (iii) representing the
balance deferred and unpaid of the purchase price of any property or services,
except (other than accounts payable or other obligations to trade creditors that
have remained unpaid for greater than ninety (90) days past their original due
date or that are being contested in good faith and for which adequate reserves
have been made) those incurred in the ordinary course of its business that would
constitute ordinarily a trade payable to trade creditors, (iv) evidenced by
bankers'
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acceptances or similar instruments issued or adapted by banks, (v) for the
payment of money relating to a Capitalized Lease Obligation, or (vi) evidenced
by a letter of credit or a reimbursement obligation of such person with respect
to any letter of credit; (b) all obligations of such person under Interest Swap
and Hedging Obligations; (c) all liabilities of others of the kind described in
the preceding clauses (a) or (b) that such person has guaranteed or that is
otherwise its legal liability (but only to the extent of the amount actually
guaranteed) and all obligations to purchase, redeem or acquire any Capital; (d)
all obligations secured by a Lien to which the property or assets (including,
without limitation, leasehold interests and any other tangible or intangible
property rights) of such person are subject, whether or not the obligations
secured thereby shall have been assumed by or shall otherwise be such person's
legal liability; provided, however, that the amount of such obligations shall be
limited to the lesser of the fair market value of the assets or property to
which such Lien attaches and the amount of the obligation so secured; and (e)
any and all deferrals, renewals, extensions, refinancings and refundings
(whether direct or indirect) of, or amendments, modifications or supplements to,
any liability of the kind described in any of the preceding clauses (a), (b),
(c) or (d), or this clause (e), whether or not between or among the same
parties.
"Indenture" means the Indenture, dated as of October 10, 1995,
among HG, RPG, as guarantor, and U.S. Trust Company of California, N.A., as
trustee.
"Intellectual Property" shall have the meaning ascribed thereto
in Section 6.9.
"Interest Swap and Hedging Obligation" means any obligation of
any person pursuant to any interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate exchange agreement,
currency exchange agreement or any other agreement or arrangement designed to
protect against fluctuations in interest rates or currency values, including,
without limitation, any arrangement whereby, directly or indirectly, such person
is entitled to receive from time to time periodic payments calculated by
applying either a fixed or floating rate of interest on a stated notional amount
in exchange for periodic payments made by such person calculated by applying a
fixed or floating rate of interest on the same notional amount.
"Investments" shall have the meaning set forth in the Senior
Secured Credit Facility Note Purchase Agreement.
"Leases" shall have the meaning ascribed thereto in Section 6.5.
"License" shall have the meaning ascribed thereto in Section 6.9.
"Lien" shall mean, as to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance in or on, or any interest or
title of any vendor, lessor, lender or other secured party to or of the Person
under any Indebtedness, conditional sale or other title retention agreement or
Capitalized Lease Obligation with respect to, any property or asset of the
Person, or the signing or filing of a financing statement which names the Person
as debtor, or the
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signing of any security agreement authorizing any other party as the secured
party thereunder to file any financing statement.
"Louisiana License" shall mean all gaming licenses required to
operate the Horseshoe Bossier City Casino.
"Majority Noteholders" means, at any time, the holders of a
majority of the aggregate principal amount of Notes then outstanding.
"Material Adverse Effect" shall mean a material adverse effect on
the business, condition (financial or otherwise), operations, earnings,
performance, properties or prospects of the Company and its Subsidiaries taken
as a whole or the ability of the Company to perform its obligations under this
Note.
"Multiemployer Plan" shall mean any employee benefit plan
described in Section 3(37) of ERISA.
"NGCP" shall mean New Gaming Capital Partnership, a Nevada
limited partnership.
"Operative Documents" means this Note, the Bossier City
Mortgage, the Bossier City Preferred Ship Mortgage, the Bossier City Second Ship
Mortgage, the Bossier City Security Agreement and the Bossier City Second
Security Agreement.
"Order" shall mean any order, writ, injunction, decree, judgment,
award, determination, direction or demand.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Permitted Liens" shall mean all Liens which may be incurred by
the Company under the Senior Secured Credit Facility Note Purchase Agreement and
the Indenture.
"Permitted Tax Distributions" shall have the meaning set forth
in the Senior Secured Credit Facility Note Purchase Agreement.
"Person" shall mean an individual, partnership, trust,
corporation, a government or agency or political subdivision or any agency,
department or instrumentality thereof or other person or entity.
"RPG" shall mean ▇▇▇▇▇▇▇▇ Property Group Limited Partnership, a
Mississippi limited partnership.
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"Senior Secured Credit Facility Note Purchase Agreement" means
the Senior Secured Credit Facility Note Purchase Agreement, dated as of October
10, 1995, among HG, the Company, as guarantor, and the purchasers named therein.
"Senior Secured Credit Facility Notes" means the notes issued by
HG pursuant to the Senior Secured Credit Facility Note Purchase Agreement.
"Senior Notes" means the 12.75% Senior Notes due September 30,
2000 of HG, issued pursuant to the Indenture.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act of 1933, as amended, as such
regulation is in effect on the date hereof.
"Subsidiary" with respect to any person, means (i) any
corporation, association or other business entity of which more than 50% of the
total voting power of Capital entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by such person or
one or more Subsidiaries of such person or by such person and one or more
Subsidiaries of such person and (ii) any partnership (a) the sole general
partner or the managing general partner of which is such person or a Subsidiary
of such person or (b) the only general partners of which are such person or one
or more Subsidiaries of such person (or any combination thereof). When used with
respect to HG, "Subsidiary" shall be deemed to include any direct Subsidiary of
HG and each indirect Subsidiary that is a direct Subsidiary of HG or one or more
of its direct or indirect Subsidiaries. Notwithstanding the foregoing, no
Unrestricted Subsidiary (as defined in the Senior Secured Credit Facility Note
Purchase Agreement) shall be a Subsidiary of HG or any of its Subsidiaries.
13. Governing Law. This Note shall be governed by and construed
in accordance with the internal laws of the State of New York.
14. Severability. If any provision of this Note shall be held to
be invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any of the provisions hereof and this Note
shall be construed as if such invalid, illegal or unenforceable provisions had
never been contained herein.
15. Miscellaneous.
a. Payments of all amounts owing under this Note are to be made
at the address of the Payee stated on the first page of this Note or at such
other address as the Holder of this Note may designate from time to time in
writing. Any payment date occurring on any day other than a Business Day shall
be deemed to be the next succeeding Business Day.
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b. The Company promises to pay all costs and expenses, including
reasonable attorneys' fees, incurred in the collection and enforcement of this
Note. The Company hereby consents to renewals and extensions of time at or after
the maturity hereof, without notice, and hereby waives diligence, presentment,
protest, demand and notice of every kind and, to the full extent permitted by
law, the right to plead any statute of limitations as a defense to any demand
hereunder.
HORSESHOE ENTERTAINMENT,
A LOUISIANA LIMITED PARTNERSHIP
By: New Gaming Capital Partnership, a Nevada
limited partnership, its General Partner
By: Horseshoe GP, Inc., its General Partner
By: _______________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Treasurer
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