EXHIBIT 99.2
LOAN AGREEMENT
Dated as of September 5, 2003
among
ALLIANCE GAMING CORPORATION,
as Borrower,
The Lenders herein named,
BANK OF AMERICA, N.A.
as Administrative Agent,
CIBC WORLD MARKETS CORP.,
as Syndication Agent
and
▇▇▇▇▇ FARGO BANK, N.A.,
as Documentation Agent
BANC OF AMERICA SECURITIES LLC
and
CIBC WORLD MARKETS CORP.,
as Joint Lead Arrangers and Joint Book Managers
TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINITIONS AND ACCOUNTING TERMS.................................... 1
1.1 Defined Terms........................................................... 1
1.2 Use of Defined Terms.................................................... 27
1.3 Accounting Terms - Fiscal Periods....................................... 27
1.4 Rounding................................................................ 27
1.5 Exhibits and Schedules.................................................. 27
1.6 Miscellaneous Terms..................................................... 27
ARTICLE 2 LOANS AND LETTERS OF CREDIT......................................... 28
2.1 Loans-General........................................................... 28
2.2 Base Rate Loans......................................................... 30
2.3 Euro-Dollar Rate Loans.................................................. 30
2.4 Letters of Credit....................................................... 30
2.5 Swing Line.............................................................. 33
2.6 Voluntary Reduction of Revolving Commitment............................. 35
2.7 Mandatory Reductions of the Revolving Commitments....................... 35
2.8 Optional Increases to the Revolving Commitment and/or the Term Loans.... 36
2.9 Administrative Agent's Right to Assume Funds Available for Advances..... 37
2.10 Senior Indebtedness..................................................... 37
2.11 Collateral.............................................................. 37
ARTICLE 3 PAYMENTS AND FEES................................................... 38
3.1 Principal and Interest.................................................. 38
3.2 Joint Lead Arranger's Fees.............................................. 41
3.3 Commitment Fees......................................................... 41
3.4 Letter of Credit Fees................................................... 41
3.5 Administrative Fees..................................................... 42
3.6 Increased Commitment Costs.............................................. 42
3.7 Euro-Dollar Costs and Related Matters................................... 42
3.8 Default Rate............................................................ 46
3.9 Computation of Interest and Fees........................................ 46
3.10 Non-Business Days....................................................... 46
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(continued)
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3.11 Manner and Treatment of Payments........................................ 47
3.12 Funding Sources......................................................... 48
3.13 Failure to Charge Not Subsequent Waiver................................. 48
3.14 Administrative Agent's Right to Assume Payments Will be Made by the
Borrower................................................................ 48
3.15 Fee Determination Detail................................................ 48
3.16 Survivability........................................................... 48
ARTICLE 4 REPRESENTATIONS AND WARRANTIES...................................... 49
4.1 Existence and Qualification; Power; Compliance With Laws................ 49
4.2 Authority; Compliance With Other Agreements and Instruments and
Government Regulations.................................................. 49
4.3 No Governmental Approvals Required - Consents to Pledge................. 50
4.4 Subsidiaries............................................................ 50
4.5 Financial Statements.................................................... 51
4.6 No Other Liabilities; No Material Adverse Changes....................... 51
4.7 Title to Property....................................................... 51
4.8 Real Property........................................................... 51
4.9 Intangible Assets....................................................... 51
4.10 Public Utility Holding Company Act...................................... 51
4.11 Litigation.............................................................. 52
4.12 Binding Obligations..................................................... 52
4.13 No Default.............................................................. 52
4.14 ERISA................................................................... 52
4.15 Regulations T, U and X; Investment Company Act.......................... 52
4.16 Disclosure.............................................................. 53
4.17 Tax Liability........................................................... 53
4.18 Projections............................................................. 53
4.19 Hazardous Materials..................................................... 53
4.20 Tax Shelter Regulations................................................. 53
ARTICLE 5 AFFIRMATIVE COVENANTS (OTHER THAN INFORMATION AND REPORTING
REQUIREMENTS)....................................................... 54
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TABLE OF CONTENTS
(continued)
PAGE
5.1 Payment of Taxes and Other Potential Liens.............................. 54
5.2 Preservation of Existence............................................... 54
5.3 Maintenance of Properties............................................... 54
5.4 Maintenance of Insurance................................................ 54
5.5 Compliance With Laws.................................................... 55
5.6 Inspection Rights....................................................... 55
5.7 Keeping of Records and Books of Account................................. 55
5.8 Compliance With Agreements.............................................. 55
5.9 Use of Proceeds......................................................... 55
5.10 New Significant Subsidiaries............................................ 55
5.11 Hazardous Materials Laws................................................ 56
5.12 Approvals of Pledge of Significant Subsidiary Shares.................... 56
ARTICLE 6 NEGATIVE COVENANTS.................................................. 56
6.1 Payment of Subordinated Obligations..................................... 56
6.2 Disposition of Property................................................. 57
6.3 Mergers................................................................. 57
6.4 Hostile Acquisitions.................................................... 58
6.5 Distributions........................................................... 58
6.6 ERISA................................................................... 58
6.7 Change in Nature of Business............................................ 58
6.8 Liens and Negative Pledges.............................................. 58
6.9 Indebtedness and Contingent Obligations................................. 60
6.10 Transactions with Affiliates............................................ 61
6.11 Capital Expenditures.................................................... 61
6.12 Investments and Acquisitions............................................ 62
6.13 Total Leverage Ratio.................................................... 63
6.14 Fixed Charge Coverage Ratio............................................. 63
6.15 Minimum EBITDA.......................................................... 63
ARTICLE 7 INFORMATION AND REPORTING REQUIREMENTS.............................. 64
7.1 Financial and Business Information...................................... 64
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(continued)
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7.2 Compliance Certificates................................................. 66
ARTICLE 8 CONDITIONS.......................................................... 67
8.1 Initial Advances on the Closing Date.................................... 67
8.2 Any Increasing Advance.................................................. 69
ARTICLE 9 EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT................ 69
9.1 Events of Default....................................................... 69
9.2 Remedies Upon Event of Default.......................................... 71
ARTICLE 10 THE ADMINISTRATIVE AGENT............................................ 73
10.1 Appointment and Authorization of Administrative Agent................... 73
10.2 Delegation of Duties.................................................... 74
10.3 Liability of Administrative Agent....................................... 74
10.4 Reliance by Administrative Agent........................................ 75
10.5 Notice of Default....................................................... 75
10.6 Credit Decision; Disclosure of Information by Administrative Agent...... 75
10.7 Indemnification of Administrative Agent................................. 76
10.8 Administrative Agent in its Individual Capacity......................... 76
10.9 Successor Administrative Agent.......................................... 77
10.10 Administrative Agent May File Proofs of Claim........................... 77
10.11 Other Agents; Arrangers and Managers.................................... 78
10.12 Collateral Matters...................................................... 78
ARTICLE 11 MISCELLANEOUS....................................................... 79
11.1 Cumulative Remedies; No Waiver.......................................... 79
11.2 Amendments; Consents.................................................... 79
11.3 Costs, Expenses and Taxes; Indemnification.............................. 80
11.4 Nature of Lenders' Obligations.......................................... 82
11.5 Survival of Representations and Warranties.............................. 82
11.6 Notices................................................................. 82
11.7 Execution of Loan Documents............................................. 83
11.8 Successors and Assigns.................................................. 84
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(continued)
PAGE
11.9 Right of Setoff......................................................... 87
11.10 Sharing of Setoffs...................................................... 88
11.11 Nonliability of the Lenders............................................. 88
11.12 No Third Parties Benefitted............................................. 89
11.13 Confidentiality......................................................... 89
11.14 Further Assurances...................................................... 90
11.15 Integration............................................................. 90
11.16 Governing Law........................................................... 90
11.17 Severability of Provisions.............................................. 90
11.18 Headings................................................................ 90
11.19 Time of the Essence..................................................... 90
11.20 Foreign Lenders and Participants........................................ 90
11.21 Hazardous Material Indemnity............................................ 91
11.22 Gaming Boards........................................................... 92
11.23 Nevada Gaming Collateral................................................ 92
11.24 Construction of the Pledge Agreements................................... 92
11.25 CONSENT TO JURISDICTION; CHOICE OF FORUM................................ 92
11.26 Waiver of Right to Trial by Jury........................................ 93
11.27 Purported Oral Amendments............................................... 93
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TABLE OF CONTENTS
(continued)
PAGE
Exhibits
A Assignment Agreement
B Compliance Certificate
C Pricing Certificate
D Request for Continuation or Conversion
E Request for Letter of Credit
F Request for Loan
G Revolving Note
H Term Note
Schedules
4.3 Governmental Approvals
4.4 Subsidiaries
4.7 Existing Liens, Negative Pledges and Rights of Others
4.8 Real Property
4.9 Intangible Assets
4.11 Material Litigation
4.19 Environmental Matters
5.12 Governmental Approvals to Licensee Pledges
6.9 Existing Indebtedness and Contingent Obligations
6.12 Existing Investments
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LOAN AGREEMENT
Dated as of September 5, 2003
This Loan Agreement ("Agreement") is entered into by and among Alliance
Gaming Corporation, a Nevada corporation ("Borrower"), each lender whose name is
set forth on the signature pages of this Agreement and each lender which may
hereafter become a party to this Agreement pursuant to Section 11.8, and Bank of
America, N.A., as Administrative Agent. Banc of America Securities LLC and CIBC
World Markets Corp. have served as Joint Lead Arrangers and Joint Book Managers
for the credit facilities described herein.
RECITALS
A. The Borrower has requested the provision of certain credit
facilities pursuant to this Agreement.
B. The Lenders are willing, on the terms and subject to the
conditions hereinafter set forth to enter into Commitments and make Loans to the
Borrower.
C. The proceeds of the Loans shall be used to refinance existing
senior and subordinated debt, for capital expenditures and to provide for
working capital requirements and for general corporate purposes.
In consideration of the foregoing and of the mutual covenants and
agreements herein contained, Borrower, the Administrative Agent, the Issuing
Lender and the Lenders, covenant and agree as follows:
ARTICLE 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the meanings set forth below:
"Acquisition" means any transaction, or any series of related
transactions, by which the Borrower or its Subsidiaries directly or
indirectly (i) acquire any going business or all or substantially all
of the assets of any Person, or any division thereof, whether through
purchase of assets, merger or otherwise, or (ii) acquire (in one
transaction or as the most recent transaction in a series of related
transactions) control of at least a majority in ordinary voting power
of the securities of a corporation which have ordinary voting power for
the election of directors, or (iii) acquire control of a 50% or more
ownership interest in any partnership, joint venture, limited liability
company or any other Person.
"Administrative Agent" means Bank of America, when acting in
its capacity as the Administrative Agent under any of the Loan
Documents, or any successor Administrative Agent.
"Administrative Agent's Office" means the Administrative
Agent's address as set forth on the signature pages of this Agreement,
or such other address as the Administrative Agent hereafter may
designate by written notice to Borrower and the Lenders.
"Advance" means any advance made or to be made by any Lender
to the Borrower under the Commitments as provided in Article 2, and
includes each Base Rate Advance, Euro-Dollar Rate Advance and Swing
Line Advance.
"Affiliate" means, as to any Person, any other Person which
directly or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (and
the correlative terms, "controlled by" and "under common control with")
shall mean possession, directly or indirectly, of power to direct or
cause the direction of management or policies (whether through
ownership of securities or partnership or other ownership interests, by
contract or otherwise); provided that, in any event, any Person that
owns, directly or indirectly, 10% or more of the securities having
ordinary voting power for the election of directors or other governing
body of a corporation that has more than 100 record holders of such
securities, or 10% or more of the partnership or other ownership
interests of any other Person that has more than 100 record holders of
such interests, will be presumed (subject to rebuttal by a
preponderance of the evidence) to control such corporation, partnership
or other Person. With respect to any Lender, the term "Affiliate" shall
be deemed to include (a) any entity (whether a corporation,
partnership, trust or otherwise) that is engaged in making, purchasing,
holding or otherwise investing in bank loans and similar extensions of
credit in the ordinary course of its business and is administered or
managed by such Lender or an Affiliate of such Lender, and (b) in the
case of any Lender that is a fund that invests in bank loans and
similar extensions of credit, any other fund that invests in bank loans
and similar extensions of credit and is managed by the same investment
advisor as such Lender or by an Affiliate of such Lender.
"Agent-Related Persons" means the Administrative Agent,
together with its Affiliates (including, in the case of Bank of America
in its capacity as the Administrative Agent, Banc of America Securities
LLC), and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and Affiliates.
"Aggregate Effective Amount" means, as of any date of
determination and with respect to all Letters of Credit then
outstanding, the sum of (a) the aggregate undrawn amount of all such
Letters of Credit then outstanding plus (b) the aggregate amounts paid
by the Issuing Lender under such Letters of Credit not then reimbursed
to the Issuing Lender by the Borrower pursuant to Section 2.4(d) and
not the subject of Advances made pursuant to Section 2.4(e).
"Agreement" means this Loan Agreement, as it may from time to
time be supplemented, modified, amended, restated or extended.
"Approved Fund" has the meaning set forth in Section 11.8(g).
2
"Assignment Agreement" means an Assignment Agreement
substantially in the form of Exhibit A.
"Average Revolver Facility Usage Percentage" means, for any
Pricing Period, the arithmetic average of the Revolver Facility Usage
Percentage for each day during the relevant Pricing Period.
"Average Total Debt" means, as of each date of determination,
the arithmetic average of the Total Debt as of that date and as of the
last day of the two immediately preceding calendar months, provided
that, in computing Average Total Debt, (a) that portion of the Total
Debt which has been permanently repaid as of the date of determination
using the proceeds of any Disposition of any Person or assets involving
a consideration in excess of $5,000,000 shall be excluded, and (ii) any
Total Debt existing on the date of determination which is attributable
to the acquisition of any Person or assets during the relevant period
for a consideration which is in excess of $5,000,000 shall be deemed to
have been outstanding on each such date.
"Bally Gaming Facilities Guaranty" means the guaranty of the
Obligations under the Commitments executed by Bally Gaming, Inc., on
the date hereof, either as originally executed or as the same may from
time to time be supplemented, modified, amended, extended or
supplanted.
"Bally Gaming Patent Assignment" means the Bally Gaming Patent
Assignment executed by Bally Gaming, Inc., on the date hereof, either
as originally executed or as the same may from time to time be
supplemented, modified, amended, extended or supplanted.
"Bally Gaming Security Agreement" means the Bally Gaming
Security Agreement executed by Bally Gaming, Inc., on the date hereof,
either as originally executed or as the same may from time to time be
supplemented, modified, amended, extended or supplanted.
"Bally Gaming Trademark Assignment" means the Bally Gaming
Trademark Assignment executed by Bally Gaming, Inc., on the date
hereof, either as originally executed or as the same may from time to
time be supplemented, modified, amended, extended or supplanted.
"Bank of America" means Bank of America, N.A., its successors
and assigns.
"Base Rate" means for any day a fluctuating rate per annum
equal to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and
(b) the rate of interest in effect for such day as publicly announced
from time to time by Bank of America as its "prime rate." The "prime
rate" is a rate set by Bank of America based upon various factors
including Bank of America's costs and desired return, general economic
conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such
announced rate. Any change in such rate announced by Bank of America
shall take effect at the opening of business on the day specified in
the public announcement of such change.
3
"Base Rate Advance" means an Advance made hereunder and
specified to be a Base Rate Advance in accordance with Article 2.
"Base Rate Loan" means a Loan made hereunder and specified to
be a Base Rate Loan in accordance with Article 2.
"Borrower" means Alliance Gaming Corporation, a Nevada
corporation, its successors and permitted assigns.
"Borrower Security Agreement" means the Borrower Security
Agreement executed on the date hereof by the Borrower to secure its
Obligations, either as originally executed or as the same may from time
to time be supplemented, modified, amended, extended or supplanted.
"Business Day" means any Monday, Tuesday, Wednesday, Thursday
or Friday, other than a day on which banks are authorized or required
to be closed in California, Nevada or New York.
"Capital Expenditure" means any expenditure for or related to
fixed assets or purchased intangibles that is treated as a capital
expenditure under Generally Accepted Accounting Principles, including
any amount which is required to be treated as an asset subject to a
Capital Lease Obligation.
"Capital Lease Obligations" means all monetary obligations of
a Person under any leasing or similar arrangement which, in accordance
with Generally Accepted Accounting Principles, is classified as a
capital lease.
"Cash" means, when used in connection with any Person, all
monetary and non-monetary items owned by that Person that are treated
as cash in accordance with Generally Accepted Accounting Principles.
"Cash Equivalents" means, when used in connection with any
Person, that Person's Investments in:
(a) Government Securities due within one year after the
date of the making of the Investment;
(b) readily marketable direct obligations of any State of
the United States of America or any political subdivision of any such
State or any public agency or instrumentality thereof given on the date
of such Investment a credit rating of at least Aa by ▇▇▇▇▇'▇ or AA by
S&P in each case due within one year from the making of the Investment;
(c) certificates of deposit issued by, bank deposits in,
eurodollar deposits through, bankers' acceptances of, and repurchase
agreements covering Government Securities executed by any Lender or by
any bank incorporated under the Laws of the United States of America,
any State thereof or the District of Columbia and having on the date of
such Investment combined capital, surplus and undivided profits of at
least
4
$250,000,000, or total assets of at least $5,000,000,000, in each case
due within one year after the date of the making of the Investment;
(d) certificates of deposit issued by, bank deposits in,
eurodollar deposits through, bankers' acceptances of, and repurchase
agreements covering Government Securities executed by any branch or
office located in the United States of America of a bank incorporated
under the Laws of any jurisdiction outside the United States of America
having on the date of such Investment combined capital, surplus and
undivided profits of at least $500,000,000, or total assets of at least
$15,000,000,000, in each case due within one year after the date of the
making of the Investment;
(e) repurchase agreements covering Government Securities
executed by a broker or dealer registered under Section 15(b) of the
Securities Exchange Act of 1934, as amended, having on the date of the
Investment capital of at least $50,000,000, due within 90 days after
the date of the making of the Investment; provided that the maker of
the Investment receives written confirmation of the transfer to it of
record ownership of the Government Securities on the books of a
"primary dealer" in such Government Securities or on the books of such
registered broker or dealer, as soon as practicable after the making of
the Investment;
(f) readily marketable commercial paper or other debt
securities issued by corporations doing business in and incorporated
under the Laws of the United States of America or any State thereof or
of any corporation that is the holding company for a bank described in
clause (c) or (d) above given on the date of such Investment a credit
rating of at least P-1 by ▇▇▇▇▇'▇ or A-1 by S&P, in each case due
within one year after the date of the making of the Investment;
(g) "money market preferred stock" issued by a
corporation incorporated under the Laws of the United States of America
or any State thereof (i) given on the date of such Investment a credit
rating of at least Aa by ▇▇▇▇▇'▇ and AA by S&P, in each case having an
investment period not exceeding 50 days or (ii) to the extent that
investors therein have the benefit of a standby letter of credit issued
by a Lender or a bank described in clauses (c) or (d) above;
(h) a readily redeemable "money market mutual fund"
sponsored by a bank described in clause (c) or (d) hereof, or a
registered broker or dealer described in clause (e) hereof, that has
and maintains an investment policy limiting its investments primarily
to instruments of the types described in clauses (a) through (g) hereof
and given on the date of such Investment a credit rating of at least Aa
by ▇▇▇▇▇'▇ and AA by S&P; and
(i) corporate notes or bonds having an original term to
maturity of not more than one year issued by a corporation incorporated
under the Laws of the United States of America or any State thereof, or
a participation interest therein; provided that any commercial paper
issued by such corporation is given on the date of such Investment a
credit rating of at least Aa by ▇▇▇▇▇'▇ and AA by S&P.
5
"Change in Control" means, (a) any transaction or series of
related transactions in which any Unrelated Person or two or more
Unrelated Persons acting in concert acquire beneficial ownership
(within the meaning of Rule 13d-3(a)(1) under the Securities Exchange
Act of 1934, as amended), directly or indirectly, of 25% or more of the
outstanding common stock of the Borrower, or (b) during any period of
24 consecutive months, individuals who at the beginning of such period
constituted the board of directors of the Borrower (together with any
new or replacement directors whose election by the board of directors,
or whose nomination for election, was approved by a vote of at least a
majority of the directors then still in office who were either
directors at the beginning of such period or whose election or
nomination for reelection was previously so approved) cease for any
reason to constitute a majority of the directors then in office.
"Closing Date" means the time and Business Day on which the
conditions set forth in Section 8.1 are satisfied or waived.
"Code" means the Internal Revenue Code of 1986, as amended or
replaced and as in effect from time to time.
"Collateral" means, collectively, all of the collateral
subject to the Liens, or intended to be subject to the Liens, created
by the Collateral Documents.
"Collateral Documents" means, collectively, the Borrower
Security Agreement, the Subsidiaries Security Agreement, the Bally
Gaming Security Agreement, the Plantation Security Agreement, the
Facilities Pledge Agreement, the Deeds of Trust, the Patent Assignment,
the Bally Gaming Patent Assignment, the Trademark Assignment, the Bally
Gaming Trademark Assignment and any other pledge agreement,
hypothecation agreement, security agreement, assignment, deed of trust,
mortgage or other instrument, document or agreement executed by the
Borrower or any of its Subsidiaries to secure the Obligations.
"Commitment Fee Rate" means, for each Pricing Period, the
applicable percentage set forth below opposite the Average Revolver
Facility Usage Percentage for that Pricing Period:
Revolver Facility Usage Percentage Commitment Fee Rate
---------------------------------- -------------------
If the Average Revolver Facility Usage Percentage is less than 33% 0.875%
If the Average Revolver Facility Usage Percentage is equal to or greater 0.625%
than 33% but less than 67%
If the Average Revolver Facility Usage Percentage is equal to or greater 0.500%
than 67%
"Commitments" means, collectively, the Revolving Commitment
and the Term Commitment.
"Compliance Certificate" means a certificate substantially in
the form of Exhibit B, properly completed and signed by a Senior
Officer of the Borrower.
6
"Contingent Obligation" means, as to any Person, any (a)
guarantee by that Person of Indebtedness of, or other obligation
performable by, any other Person or (b) assurance given by that Person
to an obligee of any other Person with respect to the performance of an
obligation by, or the financial condition of, such other Person,
whether direct, indirect or contingent, including any purchase or
repurchase agreement covering such obligation or any collateral
security therefor, any agreement to provide funds (by means of loans,
capital contributions or otherwise) to such other Person, any agreement
to support the solvency or level of any balance sheet item of such
other Person or any "keep-well" or other arrangement of whatever nature
given for the purpose of assuring or holding harmless such obligee
against loss with respect to any obligation of such other Person;
provided, however, that the term Contingent Obligation shall not
include endorsements of instruments for deposit or collection in the
ordinary course of business or guaranteed rentals payable in connection
with the placement of gaming machines by the Borrower or its
Subsidiaries in the ordinary course of their respective businesses. The
amount of any Contingent Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the related primary
obligation (unless the Contingent Obligation is limited by its terms to
a lesser amount, in which case to the extent of such amount) or, if not
stated or determinable, the maximum reasonably anticipated liability in
respect thereof as determined by the Person in good faith.
"Contractual Obligation" means, as to any Person, any
provision of any outstanding security issued by that Person or of any
material agreement, instrument or undertaking to which that Person is a
party or by which it or any of its Property is bound.
"Creditors" means, collectively, the Administrative Agent, the
Issuing Lender, the Swing Line Lender, each Lender and, where the
context requires, any one or more of them.
"Debtor Relief Laws" means the Bankruptcy Code of the United
States of America, as amended from time to time, and all other
applicable liquidation, conservatorship, bankruptcy, moratorium,
rearrangement, receivership, insolvency, reorganization, or similar
debtor relief Laws from time to time in effect affecting the rights of
creditors generally.
"Deeds of Trust" means, collectively (a) the Deed of Trust,
Assignment of Rents and Security Agreement executed by Bally Gaming,
Inc. on the date hereof with respect to the Headquarters Property to
secure its obligations under the Bally Gaming Facilities Guaranty, and
(b) the Deed of Trust, Assignment of Rents and Security Agreement
executed by Plantation Investments, Inc. on the date hereof with
respect to the Rail City Casino to secure its obligations under the
Plantation Facilities Guaranty.
"Default" means any event specified in Section 9.1 that, with
the giving of any applicable notice or passage of time specified in
Section 9.1, or both, would be an Event of Default.
"Default Rate" means the interest rate prescribed in Section
3.8.
7
"Designated Euro-Dollar Market" means, with respect to any
Euro-Dollar Rate Loan, (a) the London Euro-Dollar Market, or (b) if
prime banks in the London Euro-Dollar Market are at the relevant time
not accepting Dollar deposits or if the Administrative Agent determines
in good faith that the London Euro-Dollar Market does not represent at
the relevant time the effective pricing to the Lenders for Dollar
deposits in the London Euro-Dollar Market, such other Euro-Dollar
Market as may from time to time be selected by the Administrative Agent
with the approval of the Borrower and the Requisite Lenders.
"Disposition" means the voluntary sale, transfer or other
disposition (including any sale and leaseback), in one transaction or a
series of related transactions, of any asset of the Borrower or any of
its Subsidiaries having a value in excess of $1,000,000 other than the
voluntary sale, transfer or other disposition of (a) Cash, Cash
Equivalents, inventory or other assets sold, leased or otherwise
disposed of in the ordinary course of business of the Borrower or any
of its Subsidiaries, (b) equipment sold or otherwise disposed of where
replacement equipment has theretofore been acquired, or thereafter
within 180 days is acquired, by the Borrower or any of its
Subsidiaries, or (c) Property to the Borrower or any of its
Subsidiaries.
"Distribution" means, with respect to any shares of capital
stock, or any warrant or option to purchase an equity security, or
other equity security issued by a Person, (a) the retirement,
redemption, purchase or other acquisition for Cash or for Property
(other than capital stock, or any warrants or options to purchase an
equity security or other security of such Person) by such Person of any
such security, (b) the declaration or payment by such Person of any
dividend or distribution in Cash or in Property (other than capital
stock, or any warrants or options to purchase an equity security or
other security of such Person) on or with respect to any such security,
and (c) any Investment by such Person in the holder of 5% or more of
any such security if a purpose of such Investment is to avoid
characterization of the transaction as a Distribution.
"Dollars" or "$" means United States dollars.
"Domestic Significant Subsidiary" means each Significant
Subsidiary which is formed under the Laws of the United States of
America or any political subdivision thereof.
"EBITDA" means, for any fiscal period, the sum of (a) Net
Income for that period, plus (b) any extraordinary loss reflected in
such Net Income, minus (c) any extraordinary gain reflected in such Net
Income, plus (d) Interest Charges of the Borrower and its Subsidiaries
for that period to the extent deducted in arriving at Net Income, plus
(e) the aggregate amount of federal, state, local, and foreign taxes on
or measured by income of the Borrower and its Subsidiaries for that
period (whether or not payable during that period) to the extent
deducted in arriving at Net Income, plus (f) depreciation, amortization
and all other non-cash expenses for that period, plus (g) any
non-recurring charges reflected in such Net Income to the extent that
the same are not in excess of $5,000,000 in the aggregate during that
period, provided that in determining EBITDA, (i) the results of
operations of any Person or assets which have been the subject
8
of a Disposition involving a consideration in excess of $5,000,000 in
the aggregate during the relevant period shall be excluded, and (ii)
the results of operations of any Person or assets acquired by the
Borrower and its Subsidiaries during the relevant period for a
consideration which is in excess of $5,000,000 in the aggregate shall
be included on a pro forma basis.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; (c) an Approved Fund; and (d) any other Person (other than a
natural person) approved by (i) the Administrative Agent and (ii)
unless an Event of Default has occurred and is continuing, the Borrower
(each such approval not to be unreasonably withheld or delayed);
provided that notwithstanding the foregoing, "Eligible Assignee" shall
not include the Borrower or any of the Borrower's Affiliates or
Subsidiaries; provided, further, that no assignment shall be made to
any Person if such assignment would result in a violation of any Gaming
Laws or otherwise require the consent or approval of any Gaming Board.
"ERISA" means the Employee Retirement Income Security Act of
1974, and any regulations issued pursuant thereto, as amended or
replaced and as in effect from time to time.
"ERISA Affiliate" means, with respect to any Person, any other
Person (or any trade or business, whether or not incorporated) that is
under common control with that Person within the meaning of Section 414
of the Code.
"Euro-Dollar Business Day" means any Business Day on which
dealings in Dollar deposits are conducted by and among banks in the
Designated Euro-Dollar Market.
"Euro-Dollar Lending Office" means, as to each Lender, its
office or branch so designated by written notice to the Borrower and
the Administrative Agent as its Euro-Dollar Lending Office. If no
Euro-Dollar Lending Office is designated by a Lender, its Euro-Dollar
Lending Office shall be its office at its address for purposes of
notices hereunder.
"Euro-Dollar Market" means a regular established market
located outside the United States of America by and among banks for the
solicitation, offer and acceptance of deposits in such banks
denominated in Dollars.
"Euro-Dollar Obligations" means eurocurrency liabilities, as
defined in Regulation D or any comparable regulation of any
Governmental Agency having jurisdiction over any Lender.
"Euro-Dollar Rate" means, with respect to any Euro-Dollar Rate
Loan,
(a) the rate per annum equal to the rate determined by
the Administrative Agent to be the offered rate that appears on the
page of the Telerate screen (or any successor thereto) that displays an
average British Bankers Association Interest Settlement Rate for
deposits in Dollars (for delivery on the first day of such Interest
9
Period) with a term equivalent to such Interest Period, determined as
of approximately 11:00 a.m. (London time) two Euro-Dollar Business Days
prior to the first day of such Interest Period, or
(b) if the rate referenced in the preceding clause (a)
does not appear on such page or service or such page or service shall
not be available, the rate per annum equal to the rate determined by
the Administrative Agent to be the offered rate on such other page or
other service that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the
first day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London
time) two Euro-Dollar Business Days prior to the first day of such
Interest Period, or
(c) if the rates referenced in the preceding clauses (a)
and (b) are not available, the rate per annum determined by the
Administrative Agent as the rate of interest at which deposits in
Dollars for delivery on the first day of such Interest Period in same
day funds in the approximate amount of the Euro-Dollar Rate Loan being
made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of
America's London Branch to major banks in the London interbank
eurodollar market at their request at approximately 4:00 p.m. (London
time) two Euro-Dollar Business Days prior to the first day of such
Interest Period.
"Euro-Dollar Rate Advance" means an Advance made hereunder and
specified to be a Euro-Dollar Rate Advance in accordance with Article
2.
"Euro-Dollar Rate Loan" means a Loan made hereunder and
specified to be a Euro-Dollar Rate Loan in accordance with Article 2.
"Event of Default" means as provided in Section 9.1.
"Excluded Subsidiaries" means, collectively, Video Services,
Inc., a Louisiana corporation, Video Distributing Services, Inc., a
Louisiana corporation, Southern Video Services, Inc., a Louisiana
corporation and Rainbow Casino Vicksburg Partnership, L.P. (d/b/a/
Rainbow Casino), a Mississippi limited partnership, in each case unless
and until any such Subsidiary becomes a Wholly-Owned Subsidiary.
"Existing Credit Agreement" means the Credit Agreement dated
as of June 22, 2001 among the Borrower, Bally ▇▇▇▇▇ Automaten GMBH and
Bally ▇▇▇▇▇ Vertriebs GMBH, the lenders described therein, and
Administrative Agent and each of the security agreements, guaranties,
pledge agreements and other instruments, documents and agreements in
connection therewith.
"Existing Senior Subordinated Notes" means Borrower's
$150,000,000 10% Senior Subordinated Notes due 2007 issued pursuant to
the Indenture, dated as of August 8, 1997, among Borrower and The Bank
of New York (as successor to United States Trust Company of New York),
as Trustee, as amended.
10
"Existing Senior Subordinated Notes Tender Offer" means the
Borrower's Offer to Purchase of the Existing Senior Subordinated Notes
at a purchase price of $1,015.38 per $1,000 principal amount tendered
plus interest thereon to, but excluding, the payment date; the Offer to
Purchase, and the related solicitation of consents to certain proposed
amendments to the indenture dated as of August 8, 1997 pursuant to
which the Existing Senior Subordinated Notes were issued, are being
made pursuant to the Borrower's Offer to Purchase and Consent
Solicitation statement dated August 13, 2003.
"Facilities Guaranty" means the guaranty of the Obligations
under the Commitments executed by the Domestic Significant Subsidiaries
(other than Bally Gaming, Inc., Plantation Investments, Inc. and the
Excluded Subsidiaries) on the date hereof, either as originally
executed or as the same may from time to time be supplemented,
modified, amended, extended or supplanted.
"Facilities Pledge Agreement" means the Facilities Pledge
Agreement to be executed by the Borrower and each of its Domestic
Significant Subsidiaries, pursuant to which they shall grant security
interests in (a) 100% of the stock and other equity securities of the
Domestic Significant Subsidiaries, and (b) 100% of the Rainbow
Partnership Interests to secure (i) the Obligations under the
Commitments of the Borrower, and (ii) the Facilities Guaranty, as to
each Domestic Significant Subsidiary, either as originally executed or
as the same may from time to time be supplemented, modified, amended,
extended or supplanted.
"Federal Funds Rate" means, as of any date of determination,
the rate set forth in the weekly statistical release designated as
H.15(519), or any successor publication, published by the Federal
Reserve Board (including any such successor, "H.15(519)") for such date
opposite the caption "Federal Funds (Effective)". If for any relevant
date such rate is not yet published in H.15(519), the rate for such
date will be the rate set forth in the daily statistical release
designated as the Composite 3:30 p.m. Quotations for U.S. Government
Securities, or any successor publication, published by the Federal
Reserve Bank of New York (including any such successor, the "Composite
3:30 p.m. Quotation") for such date under the caption "Federal Funds
Effective Rate". If on any relevant date the appropriate rate for such
date is not yet published in either H.15(519) or the Composite 3:30
p.m. Quotations, the rate for such date will be the arithmetic mean of
the rates for the last transaction in overnight Federal funds arranged
prior to 9:00 a.m. (New York City time) on that date by each of three
leading brokers of Federal funds transactions in New York City selected
by the Administrative Agent. For purposes of this Agreement, any change
in the Base Rate due to a change in the Federal Funds Rate shall be
effective as of the opening of business on the effective date of such
change.
"Fiscal Quarter" means each fiscal quarter of the Borrower
consisting of the three calendar month periods ending on each March 31,
June 30, September 30 and December 31.
"Fiscal Year" means the fiscal year of the Borrower consisting
of the twelve month period ending on each June 30.
11
"Fixed Charge Coverage Ratio" means, as of the last day of
each Fiscal Quarter, the ratio of (a) EBITDA minus Maintenance Capital
Expenditures made by the Borrower and its Subsidiaries minus all taxes
paid in Cash by the Borrower and its Subsidiaries for the four Fiscal
Quarter period ending on such date to (b) Fixed Charges for the same
period.
"Fixed Charges" means, as of any date, the sum of (a) the
consolidated Interest Charges of the Borrower and its Subsidiaries paid
in cash during the twelve month period ending on that date, plus (b)
all payments of principal scheduled to be made by the Borrower and its
Subsidiaries to lenders in connection with borrowed money or Capital
Lease Obligations during the twelve month period FOLLOWING that date,
plus (c) all Distributions made by the Borrower and its Subsidiaries
during the twelve month period ending on that date (other than
Distributions to one another and to shareholders and partners in the
Excluded Subsidiaries in the ordinary course of business to the extent
that such Distributions have been deducted in arriving at Net Income),
provided that the Fixed Charges shall be adjusted to include, on a pro
forma basis, the financial results of any new Subsidiary (or operating
assets) acquired by the Borrower and its Subsidiaries during the twelve
month period ending on that date for a consideration in excess of
$5,000,000, and to exclude, on a pro forma basis, the financial results
of any Subsidiary (or operating assets) sold, transferred or otherwise
disposed of by the Borrower and its Subsidiaries for a consideration in
excess of $5,000,000 during the twelve month period ending on that
date.
"Funding Account" means an account to be maintained by the
Borrower with Bank of America, as from time to time designated by
Borrower by written notification to the Administrative Agent to which
Loans made under the Commitments will be credited pursuant to Section
2.1(f).
"Gaming Board" means, collectively, (a) the Nevada Gaming
Commission, (b) the Nevada State Gaming Control Board, (b) the
Mississippi Gaming Commission, (c) the Mississippi State Tax
Commission, (d) the Missouri Gaming Commission, (e) the Louisiana
Gaming Control Board, (f) the Michigan Gaming Control Board and (g) any
other Governmental Agency that holds regulatory, licensing or permit
authority over gambling, gaming, lottery or casino activities conducted
by the Borrower or any Subsidiary of the Borrower within its
jurisdiction.
"Gaming Laws" means, collectively, The Nevada Gaming Control
Act, The Louisiana Draw Poker Devices Control Law, the Mississippi
Gaming Control Act and Missouri laws relating to licensed gaming
activities, excursion gambling boats and suppliers of gaming equipment
and slot machines set forth in Chapter 313 of the Revised Statutes of
Missouri, in each case together with the rules and regulations
thereunder, pursuant to which any Gaming Board possesses regulatory,
licensing or permit authority over gambling, gaming, lottery or casino
activities conducted by the Borrower and its Subsidiaries within its
jurisdiction.
"Generally Accepted Accounting Principles" means, as of any
date of determination, accounting principles (a) set forth as generally
accepted in then currently
12
effective Opinions of the Accounting Principles Board of the American
Institute of Certified Public Accountants, (b) set forth as generally
accepted in then currently effective Statements of the Financial
Accounting Standards Board or (c) that are then approved by such other
entity as may be approved by a significant segment of the accounting
profession in the United States of America. The term "consistently
applied," as used in connection therewith, means that the accounting
principles applied are consistent in all material respects with those
applied at prior dates or for prior periods.
"Government Securities" means readily marketable (a) direct
full faith and credit obligations of the United States of America or
obligations guaranteed by the full faith and credit of the United
States of America and (b) obligations of an agency or instrumentality
of, or corporation owned, controlled or sponsored by, the United States
of America that are generally considered in the securities industry to
be implicit obligations of the United States of America.
"Governmental Agency" means (a) any international, foreign,
federal, state, county or municipal government, or political
subdivision thereof, (b) any governmental or quasi-governmental agency,
authority, board, bureau, commission, department, instrumentality or
public body or (c) any court or administrative tribunal of competent
jurisdiction.
"Guaranties" means, collectively, the Facilities Guaranty, the
Bally Gaming Facilities Guaranty and the Plantation Facilities
Guaranty.
"Hazardous Materials" means substances defined as "hazardous
substances" pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 et seq.,
or as "hazardous", "toxic" or "pollutant" substances or as "solid
waste" pursuant to the Hazardous Materials Transportation Act, 49
U.S.C. Section 1801, et seq., the Resource Conservation and Recovery
Act, 42 U.S.C. Section 6901, et seq., or as "friable asbestos" pursuant
to the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq., in
each case as such Laws are amended from time to time.
"Hazardous Materials Laws" means all Laws governing the
treatment, transportation or disposal of Hazardous Materials applicable
to any of the Real Property.
"Headquarters Property" means the real property located at
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ more particularly
described in Schedule 4.8 and the improvements located thereon.
"Increased Commitment" has the meaning set forth for that term
in Section 2.8.
"Indebtedness" means, as to any Person (without duplication),
(a) indebtedness of such Person for borrowed money or for the deferred
purchase price of Property (excluding trade and other accounts payable
in the ordinary course of business in accordance with ordinary trade
terms), including any Contingent Obligation for any such indebtedness,
(b) indebtedness of such Person of the nature described in clause (a)
that is non-recourse to the credit of such Person but is secured by
assets of such Person, not to exceed the value of such assets, (c) the
principal portion of the Capital Lease Obligations
13
of such Person, (d) indebtedness of such Person arising under bankers'
acceptance facilities or under facilities for the discount of accounts
receivable of such Person, (e) any direct or contingent obligations of
such Person under letters of credit issued for the account of such
Person, (f) the present value of obligations with respect to any
synthetic lease, financing lease or similar arrangement, to the extent
that the same is secured by a Lien on any asset of such Person, and (g)
any net obligations of such Person under Swap Agreements.
"Initial Pricing Period" means the period from the Closing
Date to and including September 30, 2003.
"Intangible Assets" means assets that are considered
intangible assets under Generally Accepted Accounting Principles,
including customer lists, goodwill, computer software, copyrights, mask
works, trade names, trademarks and patents.
"Interest Charges" means, for any Person, for any fiscal
period, the consolidated net interest expense of that Person during
that period determined in accordance Generally Accepted Accounting
Principles.
"Interest Differential" means, with respect to any prepayment
of a Euro-Dollar Rate Loan on a day other than the last day of the
applicable Interest Period and with respect to any failure to borrow a
Euro-Dollar Rate Loan on the date or in the amount specified in any
Request for Loan, the positive difference, if any, between (a) the
Euro-Dollar Rate payable (or, with respect to a failure to borrow, the
Euro-Dollar Rate which would have been payable) with respect to the
Euro-Dollar Rate Loan minus (b) the Euro-Dollar Rate on, or as near as
practicable to, the date of the prepayment or failure to borrow for a
Euro-Dollar Rate Loan with an Interest Period commencing on such date
and ending on the last day of the Interest Period of the Euro-Dollar
Rate Loan so prepaid or which would have been borrowed on such date.
"Interest Period" means, as to each Euro-Dollar Rate Loan, the
period commencing on the date specified by the Borrower pursuant to
Section 2.1(c) and ending one week, two weeks, one month, two months,
three months or six months thereafter (or, with the written consent of
all of the affected Lenders, any other period), as specified by the
Borrower in the applicable Request for Loan; provided that:
(a) The first day of any Interest Period shall be a
Euro-Dollar Business Day;
(b) Any Interest Period that would otherwise end on a day
that is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business
Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Euro-Dollar Business Day;
(c) The Borrower may not specify an Interest Period for
any Term Loan that extends beyond any Quarterly Payment Date unless the
aggregate principal amount of Term Loans that are Base Rate Loans or
Euro-Dollar Rate Loans having Interest Periods ending after such
Quarterly Payment Date will not thereby exceed the principal amount
14
of the Term Loans that will be outstanding (after giving effect to any
reduction thereto scheduled to be made on that Quarterly Payment Date
pursuant to Section 2.7(b));
(d) The Borrower may not specify an Interest Period for
any Revolving Loan that extends beyond any Quarterly Payment Date
unless the sum of (i) the aggregate principal amount of the Euro-Dollar
Rate Loans under the Revolving Commitment having Interest Periods
ending after such Quarterly Payment Date plus (ii) the aggregate
maximum amount available for drawing under Letters of Credit for which
the expiry date is after such Quarterly Payment Date, will not thereby
exceed the Revolving Commitment (after giving effect to any reduction
thereto scheduled to be made on that Quarterly Payment Date pursuant to
Section 2.7(c));
(e) No Interest Period shall extend beyond the Revolver
Maturity Date, in the case of a Revolving Loan, or the Term Maturity
Date, in the case of a Term Loan.
"Investment" means, when used in connection with any Person,
any investment by or of that Person, whether by means of purchase or
other acquisition of stock or other securities of any other Person or
by means of a loan, advance creating a debt, capital contribution,
guaranty or other debt or equity participation or interest in any other
Person, including any partnership and joint venture interests of such
Person, but excluding any Acquisition. The amount of any Investment
shall be the amount actually invested (minus any return of capital with
respect to such Investment which has actually been received in Cash or
Cash Equivalents or has been converted into Cash or Cash Equivalents),
without adjustment for subsequent increases or decreases in the value
of such Investment.
"Issuing Lender" means Bank of America, N.A. or one other
Lender designated by the Borrower and reasonably acceptable to Bank of
America which may hereafter agree to issue Letters of Credit hereunder.
"Joint Lead Arrangers" means, collectively, Banc of America
Securities LLC and CIBC World Markets Corp.
"Laws" means, collectively, all international, foreign,
federal, state and local statutes, treaties, rules, regulations,
ordinances, codes and administrative or judicial precedents.
"Lender" means each lender whose name is set forth in the
signature pages of this Agreement and each lender which may hereafter
become a party to this Agreement pursuant to Section 11.8.
"Letter of Credit" means any Letter of Credit issued by the
Issuing Lender under the Revolving Commitment pursuant to Section 2.4,
either as originally issued or as the same may be supplemented,
modified, amended, renewed, extended or supplanted.
"Letter of Credit Fee" means, for each Pricing Period, the per
annum rate which is equal to the Revolver Euro-Dollar Margin for that
Pricing Period.
15
"License Revocation" means the revocation, failure to renew or
suspension of, or the appointment of a receiver, supervisor or similar
official with respect to, any casino, gambling or gaming license issued
by any Gaming Board covering any casino or gaming facility of the
Borrower or any of its Subsidiaries.
"Lien" means any mortgage, deed of trust, pledge,
hypothecation, assignment for security, security interest, encumbrance,
lien or charge of any kind, whether voluntarily incurred or arising by
operation of Law or otherwise, affecting any Property, including any
agreement to grant any of the foregoing, any conditional sale or other
title retention agreement, any lease in the nature of a security
interest, and/or the filing of or agreement to give any financing
statement (other than a precautionary financing statement with respect
to a lease that is not in the nature of a security interest and
pre-filing of any financing statements associated with a financing
under which Liens will be granted only concurrently with the
refinancing of the Obligations in their entirety) under the Uniform
Commercial Code or comparable Law of any jurisdiction with respect to
any Property.
"Loan" means any Revolving Loan or Term Loan, each of which
may also be a Base Rate Loan or a Euro-Dollar Rate Loan.
"Loan Documents" means, collectively, this Agreement, the
Notes, the Swing Line Documents, the Collateral Documents, the
Guaranties, each Request for Loan, each Request for Letter of Credit,
each Compliance Certificate, each Pricing Certificate, each Swap
Agreement entered into with any Lender and any other agreements of any
type or nature hereafter executed and delivered by the Borrower or any
of its Subsidiaries to the Administrative Agent or to any Lender in any
way relating to or in furtherance of this Agreement, in each case
either as originally executed or as the same may from time to time be
supplemented, modified, amended, restated, extended or supplanted.
"Maintenance Capital Expenditure" means a Capital Expenditure
for the maintenance, repair, restoration or refurbishment of tangible
Property of the Borrower or its Subsidiaries, but excluding any Capital
Expenditure which adds to or further improves any such Property.
"Margin Stock" means "margin stock" as such term is defined in
Regulation U.
"Material Adverse Effect" means any set of circumstances or
events which (a) has or could reasonably be expected to have a material
adverse effect upon the validity or enforceability of any Loan
Document, (b) is or could reasonably be expected to be material and
adverse to the business or condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries, taken as a whole and
with a view to the totality of circumstances then existing with respect
to the Borrower and its Subsidiaries, or (c) materially impairs or
could reasonably be expected to materially impair the ability of the
Borrower and its Subsidiaries (taken as a whole) to perform the
Obligations under the Revolving Commitment or the Term Commitment.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
16
"Multiemployer Plan" means any employee benefit plan of the
type described in Section 4001(a)(3) of ERISA to which the Borrower or
any of its ERISA Affiliates contribute or are obligated to contribute.
"Negative Pledge" means a Contractual Obligation that contains
a covenant binding on the Borrower or any of its Subsidiaries that
prohibits Liens on any of its or their Property in favor of the
Administrative Agent or the creditors under any successor or
replacement senior credit facility, other than (a) any such covenant
contained in a Contractual Obligation granting a Lien permitted under
Section 6.8 or pursuant to which the Borrower or its Subsidiaries
acquire a right to use or occupy Property, in each case to the extent
that such covenant which affects only the Property that is the subject
of such permitted Lien or which is so acquired and (b) any such
covenant that does not apply to Liens securing the Obligations and to
any indebtedness which is used, directly or indirectly, to refinance
the Obligations.
"Net Cash Proceeds" means, with respect to any Disposition of
assets of the Borrower and its United States domestic Subsidiaries, the
cash proceeds received by the Borrower or by any Subsidiary of the
Borrower upon such Disposition minus (a) the actual expenses of such
sale paid or payable by the Borrower or by any Subsidiary of the
Borrower in connection with such Disposition, and minus (b) an amount
equal to the taxes paid or payable in cash by the Borrower with respect
to such Disposition.
"Net Income" means, for any period, the consolidated net
income of the Borrower and its Subsidiaries for that period, determined
in accordance with Generally Accepted Accounting Principles,
consistently applied.
"Note" means, collectively, the Revolving Notes and the Term
Notes.
"Obligations" means all present and future obligations of
every kind or nature of the Borrower or its Subsidiaries at any time
and from time to time owed to the Administrative Agent, the Issuing
Lender, the Swing Line Lender or the Lenders or any one or more of
them, under any one or more of the Loan Documents, whether due or to
become due, matured or unmatured, liquidated or unliquidated, or
contingent or noncontingent, including obligations of performance as
well as obligations of payment, and including interest that accrues
after the commencement of any proceeding under any Debtor Relief Law by
or against the Borrower or any of its Subsidiaries, whether or not
allowed as a claim in such proceeding.
"Opinions" means the favorable written legal opinions of
▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, special counsel to the Borrower and its
Subsidiaries and ▇▇▇▇▇ ▇▇▇▇▇▇, special Nevada local counsel to the
Borrower and its Subsidiaries.
"Outstanding Obligations" means, as of each date of
determination, and giving effect to the making of any such credit
accommodations requested on that date, the sum of (i) the aggregate
principal amount of the outstanding Loans, plus (ii) the Swing Line
Outstandings, plus (iii) the Aggregate Effective Amount of all
outstanding Letters of Credit.
17
"Party" means any Person other than the Administrative Agent,
the Issuing Lender, the Swing Line Lender and the Lenders, which now or
hereafter is a party to any of the Loan Documents.
"Patent Assignment" means the Patent Assignment executed by
United Coin Machine Co., Bally Gaming International, Inc., and Borrower
on the date hereof, either as originally executed or as the same may
from time to time be supplemented, modified, amended, extended or
supplanted.
"Pension Plan" means any "employee pension benefit plan" (as
such term is defined in Section 3(2) of ERISA), other than a
Multiemployer Plan, which is subject to Title IV of ERISA and is
maintained by the Borrower or any of its Subsidiaries or to which the
Borrower or any of its Subsidiaries contributes or has an obligation to
contribute.
"Permitted Encumbrances" means:
(a) inchoate Liens incident to construction on or
maintenance of real property; or Liens incident to construction on or
maintenance of real property now or hereafter filed of record for which
adequate reserves have been set aside in accordance with Generally
Accepted Accounting Principles (or deposits made pursuant to applicable
Law) and which are being contested in good faith by appropriate
proceedings and have not proceeded to judgment, provided that, by
reason of nonpayment of the obligations secured by such Liens, no such
real property is subject to a material risk of loss or forfeiture;
(b) Liens for taxes and assessments which are not yet
delinquent; or Liens for taxes and assessments for which adequate
reserves have been set aside in accordance with Generally Accepted
Accounting Principles and are being contested in good faith by
appropriate proceedings and have not proceeded to judgment, provided
that, by reason of nonpayment of the obligations secured by such Liens,
no Property is subject to a material risk of loss or forfeiture;
(c) minor defects and irregularities in title to any real
property which in the aggregate do not materially impair the fair
market value or use of the real property for the purposes for which it
is or may reasonably be expected to be held;
(d) easements, exceptions, reservations, or other
agreements for the purpose of pipelines, conduits, cables, wire
communication lines, power lines and substations, streets, trails,
walkways, drainage, irrigation, water, and sewerage purposes, dikes,
canals, ditches, the removal of oil, gas, coal, or other minerals, and
other like purposes affecting real property, facilities, or equipment
which in the aggregate do not materially burden or impair the fair
market value or use of such real property for the purposes for which it
is or may reasonably be expected to be held;
(e) easements, exceptions, reservations, or other
agreements for the purpose of facilitating the joint or common use of
real property in or adjacent to a shopping center or similar project
affecting real property which in the aggregate do not materially burden
18
or impair the fair market value or use of such real property for the
purposes for which it is or may reasonably be expected to be held;
(f) rights reserved to or vested in any Governmental
Agency to control or regulate, or obligations or duties to any
Governmental Agency with respect to, the use of any real property;
(g) present or future zoning laws and ordinances or other
laws and ordinances restricting the occupancy, use, or enjoyment of
real property;
(h) statutory or common law Liens, other than those
described in clauses (a) or (b) above, arising in the ordinary course
of business with respect to obligations which are not delinquent or are
being contested in good faith, provided that, if delinquent, adequate
reserves have been set aside in accordance with Generally Accepted
Accounting Principles with respect thereto and, by reason of
nonpayment, no real property is subject to a material risk of loss or
forfeiture;
(i) covenants, conditions, and restrictions affecting the
use of real property which in the aggregate do not materially impair
the fair market value or use of the real property for the purposes for
which it is or may reasonably be expected to be held;
(j) rights of tenants under leases and rental agreements
covering real property entered into in the ordinary course of business
of the Person owning such real property;
(k) bankers liens and Liens consisting of pledges or
deposits to secure obligations under workers' compensation laws,
mandatory unemployment insurance or similar legislation, including
Liens of judgments thereunder which are not currently dischargeable;
(l) Liens consisting of pledges or deposits of Property
to secure performance in connection with operating leases made in the
ordinary course of business to which the Borrower or a Subsidiary of
the Borrower is a party as lessee, provided the aggregate value of all
such pledges and deposits in connection with any such lease does not at
any time exceed 20% of the annual fixed rentals payable under such
lease; and
(m) Liens in favor of Governmental Agencies on the assets
of the Borrower and its Subsidiaries imposed by applicable Gaming Laws
to the extent required in connection with the operation of lotteries in
various jurisdictions.
"Permitted Right of Others" means a Right of Others consisting
of (a) an interest (other than a legal or equitable co-ownership
interest, an option or right to acquire a legal or equitable
co-ownership interest and any interest of a ground lessor under a
ground lease), that does not materially impair the value or use of
Property for the purposes for which it is or may reasonably be expected
to be held, (b) an option or right to acquire a Lien that would be a
Permitted Encumbrance, (c) the subordination of a lease or sublease in
favor of a financing entity, (d) a lease, rental or similar agreement
covering Property entered into in the ordinary course of business and
(e) a license, or similar right, of or to Intangible Assets granted in
the ordinary course of business.
19
"Person" means any individual or entity, including a trustee,
corporation, limited liability company, general partnership, limited
partnership, joint stock company, trust, estate, unincorporated
organization, business association, firm, joint venture, Governmental
Agency, or other entity.
"Plantation Facilities Guaranty" means the guaranty of the
Obligations under the Commitments executed by Plantation Investments,
Inc., on the date hereof, either as originally executed or as the same
may from time to time be supplemented, modified, amended, extended or
supplanted.
"Plantation Security Agreement" means the Plantation Security
Agreement executed by Plantation Investments, Inc., on the date hereof,
either as originally executed or as the same may from time to time be
supplemented, modified, amended, extended or supplanted.
"Pricing Certificate" means each Pricing Certificate delivered
to the Administrative Agent in accordance with Section 7.1(c),
substantially in the form of Exhibit C, properly completed and signed
by a Senior Officer of the Borrower.
"Pricing Period" means, the Initial Pricing Period and each
subsequent period of three calendar months which commences on the first
day of each March, June, September and December.
"Pro Rata Share" means, as to each of the Commitments and
Loans and with respect to each Lender, the percentage of the Loans (and
of any the Letters of Credit and the Swing Line Advances) held by that
Lender (or by an SPC (as defined in Section 11.8(h)) for which that
Lender is the Granting Lender) with respect to each Commitment, or if
no Commitment is outstanding, the principal amount of all Loans made
pursuant to the expired Commitment.
"Projections" means the financial projections for the Borrower
and its Subsidiaries prepared on behalf of the Borrower and heretofore
distributed to the Lenders.
"Property" means any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or intangible.
"Quarterly Payment Date" means the last Business Day of each
calendar quarter following the date hereof.
"Rainbow Partnership Interests" means those partnership
interests in Rainbow Casino Vicksburg Partnership, L.P. which are at
any time owned, directly or indirectly, by the Borrower.
"Real Property" means, as of any date of determination, all
real Property then or theretofore owned, leased or occupied by the
Borrower or any of its Subsidiaries.
20
"Regulations D, T, U and X" means Regulations D, T, U and X,
as at any time amended, of the Board of Governors of the Federal
Reserve System, or any other regulations in substance substituted
therefor.
"Request for Conversion or Continuation" means a written
request for a the conversion or continuation of Loan substantially in
the form of Exhibit D, signed by a Responsible Official of the Borrower
on its behalf, and properly completed to provide all information
required to be included therein.
"Request for Letter of Credit" means a written request for a
Letter of Credit substantially in the form of Exhibit E, signed by a
Responsible Official of the Borrower on its behalf (and by any
Subsidiary of the Borrower which is designated by the Borrower as the
account party with respect to the related Letter of Credit), and
properly completed to provide all information required to be included
therein.
"Request for Loan" means a written request for a Loan
substantially in the form of Exhibit F, signed by a Responsible
Official of the Borrower on its behalf, and properly completed to
provide all information required to be included therein.
"Requirement of Law" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or
governing documents of such Person, and any Law, or judgment, award,
decree, writ or determination of a Governmental Agency, in each case
applicable to or binding upon such Person or any of its Property or to
which such Person or any of its Property is subject.
"Requisite Lenders" means (a) as of any date of determination
if the Commitments are then in effect, Lenders having Pro Rata Shares
of the Revolving Commitment and the Term Commitment which are, in the
aggregate, 51% or more of the Pro Rata Shares of the aggregate
Revolving Commitment and Term Commitment then in effect, and (b) as of
any date of determination if any of the Commitments have then been
terminated and there are then any Obligations outstanding, Lenders or
other Creditors holding 51% or more of all the Outstanding Obligations.
"Responsible Official" means (a) when used with reference to a
Person other than an individual, any officer or manager of such Person,
general partner of such Person, officer of a corporate or limited
liability company general partner of such Person, officer of a
corporate or limited liability company general partner of a partnership
that is a general partner of such Person, or any other responsible
official thereof duly acting on behalf thereof, and (b) when used with
reference to a Person who is an individual, such Person. The Lenders
shall be entitled to conclusively rely upon any document or certificate
that is signed or executed by a Responsible Official of the Borrower or
any of its Subsidiaries as having been authorized by all necessary
corporate, limited liability company, partnership and/or other action
on the part of the Borrower or such Subsidiary.
"Revolver Base Rate Margin" means, as of any date, the then
applicable Revolver Euro-Dollar Margin minus 1.25%.
21
"Revolver Euro-Dollar Margin" means (a) for the Initial
Pricing Period, 2.50%, and (b) for each subsequent Pricing Period, the
applicable percentage set forth below opposite the Total Leverage Ratio
for that Pricing Period:
Total Leverage Ratio Revolver Euro-Dollar Margin
-------------------- ---------------------------
Less than 2.25:1.00 2.00%
Equal to or greater than 2.25:1.00 2.25%
but less than 2.75:1.00
Equal to or greater than 2.75:1.00 2.50%
but less than 3.25:1.00
Equal to or greater than 3.25:1.00 2.75%
"Revolver Facility Usage Percentage" means, as of any date of
determination, a fraction (expressed as a percentage), the numerator of
which is the Revolver Usage (other than Swing Line Outstandings) and
the denominator of which is the Revolving Commitment, in each case as
of such date of determination.
"Revolver Maturity Date" means September 4, 2008.
"Revolver Reduction Amount" means, as to each Quarterly
Payment Date set forth below, the amount opposite that Quarterly
Payment Date:
Revolver
Quarterly Payment Dates Reduction Amount
----------------------- ----------------
September 30, 2005 though and including June 30, 2008 $ 4,166,667
Revolver Maturity Date $75,000,000
provided that, in the event that the Commitment is hereafter increased
in the manner contemplated by Section 2.8, then the Revolver Reduction
Amount for each then remaining Quarterly Payment Date shall be
increased in the same proportion that (a) the Increased Commitment
bears to (b) the Commitment prior to the effective date of such
increase.
"Revolving Commitment" means the commitment by Lenders having
Pro Rata Shares thereof to make Revolving Loans to the Borrower in an
aggregate principal amount, subject to any decrease in the amount
thereof pursuant to Sections 2.6 and 2.7, not to exceed $125,000,000,
provided that the amount thereof may be increased pursuant to Section
2.8.
"Revolving Commitment Percentage" means, as of any date of
determination, a fraction (expressed as a percentage), the numerator of
which is the Revolving Commitment as of such date and the denominator
of which is the sum of the Revolving Commitment as of such date plus
the aggregate principal amount of Term Loans then outstanding.
"Revolving Loan" means any Advance or group of Advances made
by the Lenders at any one time under the Revolving Commitment pursuant
to Article 2.
22
"Revolving Notes" means, collectively, each of the promissory
notes made by the Borrower to a Lender evidencing Loans under the
Revolving Commitment, substantially in the form of Exhibit G, either as
originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or supplanted.
"Revolving Usage" means as of each date of determination, the
sum of (a) the aggregate principal Indebtedness then outstanding under
the Revolving Notes, plus (b) Swing Line Outstandings plus (c) the
Aggregate Effective Amount of all outstanding Letters of Credit.
"Right of Others" means, as to any Property in which a Person
has an interest, any legal or equitable right, title or interest (other
than a Lien) held by any other Person in that Property, and any option
or right held by any other Person to acquire any such right, title or
interest in that Property, including any option or right to acquire a
Lien; provided, however, that (a) any covenant restricting the use or
disposition of Property of such Person contained in any Contractual
Obligation of such Person and (b) any provision contained in a contract
creating a right of payment or performance in favor of a Person that
conditions, limits, restricts, diminishes, transfers or terminates such
right, shall not be deemed to constitute a Right of Others.
"Senior Officer" means the (a) chief executive officer or
manager, (b) president, (c) executive vice president, (d) senior vice
president, (e) chief financial officer, (f) chief accounting officer,
(g) treasurer, (h) assistant treasurer, (i) secretary, or (j) assistant
secretary of the Borrower or any of its Subsidiaries.
"Significant Subsidiaries" means each Subsidiary which either
as of the Closing Date or any subsequent date has (a) a consolidated
tangible net worth which is in excess of $500,000, (b) consolidated net
income during any fiscal year of that Subsidiary which is in excess of
$250,000, or (c) consolidated revenues which are in excess of $500,000.
No Person which is at any time a Significant Subsidiary shall cease to
be a Significant Subsidiary by reason of its failure to achieve any one
of the financial benchmarks described above.
"Special Euro-Dollar Circumstance" means the application or
adoption after the date hereof of any Law or interpretation, or any
change therein or thereof, or any change in the interpretation or
administration thereof by any Governmental Agency, central bank or
comparable authority charged with the interpretation or administration
thereof, or change in the manner of compliance by any Lender or its
Euro-Dollar Lending Office with any request or directive (whether or
not having the force of Law) of any such Governmental Agency, central
bank or comparable authority, or the existence or occurrence of
circumstances affecting the Designated Euro-Dollar Market generally
that are beyond the reasonable control of the Lenders.
"Subordinated Obligations" means (a) the Existing Senior
Subordinated Notes, and (b) any other unsecured Indebtedness of the
Borrower (but not Indebtedness of any Subsidiary of the Borrower), the
incurrence of which is approved by the Joint Lead Arrangers, and which,
in any event:
23
(i) does not require amortization prior to the first
anniversary of the Term Maturity Date;
(ii) is governed by agreements which contain
representations, warranties, covenants, defaults and other provisions
which are approved by the Joint Lead Arrangers in writing and in any
event less restrictive upon and onerous to, the Borrower and its
Subsidiaries than the provisions of the Loan Documents; and
(iii) is subordinated in right of payment to the
Obligations pursuant to subordination provisions which are acceptable
to the Joint Lead Arrangers in the exercise of their sole discretion.
"Subsidiaries Security Agreement" means the Subsidiaries
Security Agreement executed on the date hereof by each Domestic
Significant Subsidiary other than the Excluded Subsidiaries to secure
its Guaranty of the Commitments, either as originally executed or as
the same may from time to time be supplemented, modified, amended,
extended or supplanted.
"Subsidiary" means, as of any date of determination and with
respect to any Person, any other Person the accounts of which should in
accordance with Generally Accepted Accounting Principles be
consolidated with those of the first Person for financial accounting
purposes.
"Swap Agreement" means a written agreement between the
Borrower and one or more financial institutions providing for "swap",
"cap", "collar" or other interest rate protection with respect to any
Indebtedness.
"Swing Line" means the revolving line of credit established by
the Swing Line Lender in favor of the Borrower pursuant to Section 2.5.
"Swing Line Advance" means an Advance made under the Swing
Line.
"Swing Line Documents" means the promissory note and any other
documents executed by the Borrower in favor of the Swing Line Lender in
connection with the Swing Line, either as originally executed or as it
may from time to time be supplemented, modified, amended, restated or
extended.
"Swing Line Lender" means Bank of America, acting through its
Nevada Commercial Banking Division.
"Swing Line Loans" means loans made by the Swing Line Lender
to the Borrower pursuant to Section 2.5.
"Swing Line Outstandings" means, as of any date of
determination, the aggregate principal Indebtedness of the Borrower on
all Swing Line Loans then outstanding.
"S&P" means Standard & Poor's Ratings Group (a division of
McGraw Hill, Inc.).
24
"Term Base Rate Margin" means, as of any date, the then
applicable Term Euro-Dollar Margin minus 1.25%.
"Term Commitment" means the commitment by Lenders having Pro
Rata Shares of thereof to make a loan to the Borrower on the Closing
Date in the amount of $275,000,000 and to refinance the outstanding
balance thereof from time to time in accordance with the terms hereof
by new Loans, provided that the amount thereof may be increased
pursuant to Section 2.8.
"Term Euro-Dollar Margin" means the applicable percentage set
forth below opposite the Total Leverage Ratio then in effect:
Total Leverage Ratio Term Euro-Dollar Margin
-------------------- -----------------------
Less than 2.25:1.00 2.50%
Equal to or greater than 2.25:1.00 2.75%
"Term Loan" means any Advance or group of Advances made by the
Lenders at any one time under the Term Commitment pursuant to Article
2.
"Term Loan Percentage" means, as of any date of determination,
a fraction (expressed as a percentage), the numerator of which is the
aggregate principal amount of Term Loans then outstanding and the
denominator of which is the sum of the Revolving Commitment as of such
date plus the aggregate principal amount of Term Loans then
outstanding.
"Term Maturity Date" means September 4, 2009.
"Term Notes" means, collectively, each of the promissory notes
made by the Borrower to a Lender evidencing Loans under the Term
Commitment, substantially in the form of Exhibit H, either as
originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or supplanted.
"Title Policies" means the policies of title insurance issued
by First American Title Company of Nevada with respect to the Deeds of
Trust and delivered to the Administrative Agent pursuant to Section
8.1.
"Total Debt" means, as of any date of determination, the sum
(without duplication) of (a) the outstanding principal Indebtedness of
the Borrower and its Subsidiaries for borrowed money (including debt
securities issued by the Borrower or any of its Subsidiaries) on that
date, plus (b) the aggregate amount of the principal portion of all
Capital Lease Obligations of the Borrower and its Subsidiaries on that
date, plus (c) all obligations in respect of letters of credit,
performance bonds, surety bonds, appeal bonds or custom bonds or other
similar instruments for which the Borrower or any of its Subsidiaries
are account parties or are otherwise obligated, plus (d) without
duplication the aggregate amount of all Contingent Obligations and
other similar contingent obligations of the Borrower and its
Subsidiaries with respect to any of the foregoing, and plus (e) any
other obligations of the Borrower or any of its Subsidiaries to
25
the extent that the same are secured by a Lien on any of the assets of
the Borrower or its Subsidiaries.
"Total Leverage Ratio" means, as of the last day of each
Fiscal Quarter, the ratio of (a) Average Total Debt, to (b) EBITDA for
the four Fiscal Quarter period ending on that date.
"to the best knowledge of" means, when modifying a
representation, warranty or other statement of any Person, that the
fact or situation described therein is known by the Person (or, in the
case of a Person other than a natural Person, known by a Responsible
Official of that Person) making the representation, warranty or other
statement, or with the exercise of reasonable due diligence under the
circumstances (in accordance with the standard of what a reasonable
Person in similar circumstances would have done) would have been known
by the Person (or, in the case of a Person other than a natural Person,
would have been known by a Responsible Official of that Person).
"Trademark Assignment" means the Trademark Assignment executed
by United Coin Machine Co., Bally Gaming International, Inc. and
Borrower on the date hereof, either as originally executed or as the
same may from time to time be supplemented, modified, amended, extended
or supplanted.
"type", when used with respect to any Loan or Advance, means
the designation of whether such Loan or Advance is a Base Rate Loan or
Advance, or a Euro-Dollar Rate Loan or Advance.
"Unrelated Person" means any Person other than (i) an employee
stock ownership plan or other employee benefit plan covering the
employees of the Borrower and its Subsidiaries or (ii) an Affiliate of
any Person or group of related Persons which as of the date of this
Agreement is the beneficial owner of 25% or more (in the aggregate) of
the outstanding common stock of the Borrower.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i)
any corporation 100% of whose capital stock is at the time owned by
such Person and/or one or more Wholly-Owned Subsidiaries of such Person
and (ii) any partnership, association, joint venture or other entity in
which such Person and/or one or more Wholly-Owned Subsidiaries of such
Person has a 100% equity interest at such time. Notwithstanding
anything to the contrary contained above, a foreign Subsidiary of the
Borrower shall be deemed to be a Wholly-Owned Subsidiary of the
Borrower if both (x) it would satisfy the requirements of the
definition contained above with respect to the Borrower if the
percentages "100%" contained above were changed to "99%" and (y) the
reduction to 99% as contemplated by preceding clause (x) is necessary
because director's qualifying shares, ownership of shares by foreign
nationals, or other ownership requirements apply under applicable law
(or is necessary to obtain applicable approvals required by law) to
such foreign Subsidiary.
26
1.2 Use of Defined Terms. Any defined term used in the plural
shall refer to all members of the relevant class, and any defined term used in
the singular shall refer to any one or more of the members of the relevant
class.
1.3 Accounting Terms - Fiscal Periods. All accounting terms not
specifically defined in this Agreement shall be construed in conformity with,
and all financial data required to be submitted by this Agreement shall be
prepared in conformity with, Generally Accepted Accounting Principles applied on
a consistent basis, except as otherwise specifically prescribed herein. In the
event that Generally Accepted Accounting Principles or the Borrower's Fiscal
Year or Fiscal Quarters change during the term of this Agreement such that the
covenants contained in Sections 6.13 through 6.15 would then be calculated for
different periods, in a different manner or with different components, (a) the
Borrower and the Lenders agree to amend this Agreement in such respects as are
necessary to conform those covenants as criteria for evaluating the Borrower's
financial condition to substantially the same criteria as were effective prior
to such change in Fiscal Year, Fiscal Quarters or in Generally Accepted
Accounting Principles and (b) the Borrower shall be deemed to be in compliance
with the covenants contained in the aforesaid Sections if and to the extent that
the Borrower would have been in compliance therewith for the pre-existing fiscal
periods and under Generally Accepted Accounting Principles as in effect
immediately prior to such change, but shall have the obligation to deliver each
of the materials described in Article 7 to the Creditors, on the dates therein
specified, with financial data presented for its pre-existing fiscal periods and
in a manner which conforms with Generally Accepted Accounting Principles as in
effect immediately prior to such change.
1.4 Rounding. Any financial ratios required to be maintained by
the Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed in this
Agreement and rounding the result up or down to the nearest number (with a
round-up if there is no nearest number) to the number of places by which such
ratio is expressed in this Agreement.
1.5 Exhibits and Schedules. All Exhibits and Schedules to this
Agreement, either as originally existing or as the same may from time to time be
supplemented, modified or amended, are incorporated herein by this reference. A
matter disclosed on any Schedule shall be deemed disclosed on all Schedules.
1.6 Miscellaneous Terms. In the Loan Documents, the term "or" is
disjunctive; the term "and" is conjunctive. The term "shall" is mandatory; the
term "may" is permissive. Masculine terms also apply to females; feminine terms
also apply to males. The term "including" is by way of example and not
limitation.
27
ARTICLE 2
LOANS AND LETTERS OF CREDIT
2.1 Loans-General.
(a) Subject to the terms and conditions set forth in this
Agreement, at any time and from time to time from the Closing Date
through the Business Day immediately prior to the Revolver Maturity
Date, each Lender shall, pro rata according to that Lender's Pro Rata
Share of the then applicable Revolving Commitment, make Advances to the
Borrower in Dollars under the Revolving Commitment in such amounts as
the Borrower may request that do not exceed in the aggregate at any one
time outstanding that Lender's Pro Rata Share of the Revolving
Commitment; provided that, giving effect to the requested Loan, the
Revolving Usage shall not exceed the then applicable Revolving
Commitment. Subject to the limitations set forth herein, the Advances
by each Lender under its Pro Rata Share of the Revolving Commitment may
be prepaid without premium or penalty, and amounts that are prepaid
may, subject to the conditions set forth herein, be reborrowed.
(b) Subject to the terms and conditions set forth in this
Agreement, on the Closing Date, each Lender shall make a Term Loan to
the Borrower in Dollars under the Term Commitment in the full amount of
such Lender's Pro Rata Share of the Term Commitment. The Term Loan
shall be evidenced by the Term Notes. Amounts repaid under the Term
Commitment may not be reborrowed, but may be refinanced with the
proceeds of new Term Loans.
(c) Subject to the next sentence, each Loan shall be made
pursuant to a Request for Loan which shall specify the requested (i)
date of such Loan, (ii) Commitment under which the Loan is to be made,
(iii) type of Loan, (iv) amount of such Loan, (v) in the case of a
Euro-Dollar Rate Loan, the Interest Period for such Loan, and (vi) in
the case of each Loan under the Revolving Commitment, the amount of the
Revolving Usage. Unless the Administrative Agent, in its sole and
absolute discretion, has notified the Borrower to the contrary, a Loan
may be requested by telephone by a Responsible Official of the
Borrower, in which case the Borrower shall confirm such request by
promptly delivering a Request for Loan in person or by telecopier
conforming to the preceding sentence to the Administrative Agent. The
Administrative Agent shall incur no liability whatsoever hereunder in
acting upon any telephonic request purportedly made by a Responsible
Official of the Borrower, and the Borrower hereby agrees to indemnify
each Creditor from any loss, cost, expense or liability as a result of
so acting.
(d) So long as no Default or Event of Default has
occurred and is continuing, the Borrower shall have the option at any
time (i) to convert all or any part of its outstanding Base Rate Loans
which are in integral multiples of $500,000 and which are not less than
$2,500,000 into Euro-Dollar Rate Loans or (ii) upon the expiration of
any Interest Period applicable to Euro-Dollar Rate Loans, to continue
all or any portion of such Loans equal to $2,500,000 and integral
multiples of $500,000 in excess of that amount as Euro-Dollar Rate
Loans or to convert such Loans into Base Rate Loans.
28
(e) The Borrower shall deliver to the Administrative
Agent a Request for Conversion or Continuation, no later than 8:00 A.M.
(California local time) (A) at least one Business Day in advance of the
proposed conversion date (in the case of a conversion to a Base Rate
Loan) and (B) at least three Euro-Dollar Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion
to, or a continuation of, a Euro-Dollar Rate Loan under the Term
Commitment or the Revolving Commitment). A Request for Conversion or
Continuation shall specify (i) the proposed conversion/continuation
date (which shall be a Business Day in the case of Base Rate Loans and
a Euro-Dollar Business Day in the case of conversion to or continuation
of Euro-Dollar Rate Loans), (ii) the amount and type of the Loan to be
converted/continued, (iii) the nature of the proposed
conversion/continuation, (iv) in the case of a conversion to, or a
continuation of, a Euro-Dollar Rate Loan, the requested Interest
Period, and (v) in the case of a conversion to, or a continuation of, a
Euro-Dollar Rate Loan, that no Default or Event of Default has occurred
and is continuing.
(f) Promptly following receipt of a Request for Loan, the
Administrative Agent shall notify each Lender by telephone or
telecopier of the date and type of the Loan, any applicable Interest
Period, and that Lender's Pro Rata Share of the Loan. Not later than
11:00 a.m., California local time, on the date specified for any Loan
under the Revolving Commitment or the Term Commitment (which must be a
Business Day), each Lender shall make its Pro Rata Share thereof
available to the Administrative Agent in immediately available funds at
the Administrative Agent's Office. Upon satisfaction or waiver of the
applicable conditions set forth in Article 8, all Advances shall be
credited on that date in immediately available funds to the relevant
Funding Account.
(g) Unless the Requisite Lenders otherwise consent, each
Loan shall be in an integral multiple of $500,000 which is not less
than $2,500,000.
(h) The Advances made by each Lender under the Revolving
Commitment and the Term Commitment shall be evidenced by that Lender's
Revolving Note and Term Note, respectively.
(i) A Request for Loan shall be irrevocable upon the
Administrative Agent's first notification thereof.
(j) If no Request for Loan (or telephonic request for
Loan referred to in the second sentence of Section 2.1(c), if
applicable) has been made within the requisite notice periods set forth
in Section 2.2 or 2.3 prior to the end of the Interest Period for any
Euro-Dollar Rate Loan, then on the last day of such Interest Period,
such Euro-Dollar Rate Loan shall be automatically converted into a Base
Rate Loan in the same amount.
(k) If a Loan is to be made on the same date that another
Loan under the same Commitment is due and payable, the Borrower or the
Lenders (as the case may be) shall upon the request of the
Administrative Agent make available to the Administrative Agent the net
amount of funds (giving effect to both such Loans) and the effect for
purposes of this Agreement shall be the same as if separate transfers
of funds had been made with respect to each such Loan.
29
2.2 Base Rate Loans. Each request by the Borrower for a Base Rate
Loan shall be made pursuant to a Request for Loan (or telephonic or other
request for loan referred to in the second sentence of Section 2.1(c), if
applicable) received by the Administrative Agent, at the Administrative Agent's
Office, not later than 8:00 a.m. California local time, on the date (which must
be a Business Day) of the requested Base Rate Loan.
2.3 Euro-Dollar Rate Loans.
(a) Each request by the Borrower for a Euro-Dollar Rate
Loan shall be made pursuant to a Request for Loan (or telephonic or
other request for Loan referred to in the second sentence of Section
2.1(c), if applicable) received by the Administrative Agent, at the
Administrative Agent's Office, not later than 8:00 a.m., California
local time, at least three Euro-Dollar Business Days before the first
day of the applicable Interest Period.
(b) On the date which is two Euro-Dollar Business Days
before the first day of the applicable Interest Period, the
Administrative Agent shall confirm its determination of the applicable
Euro-Dollar Rate (which determination shall be conclusive in the
absence of manifest error) and promptly shall give notice of the same
to the Borrower and the Lenders by telephone or telecopier.
(c) Unless the Administrative Agent and the Requisite
Lenders otherwise consent, no more than fifteen Euro-Dollar Rate Loans
shall be outstanding at any one time.
(d) No Euro-Dollar Rate Loan may be requested during the
continuation of a Default or Event of Default.
(e) Nothing contained herein shall require any Lender to
fund any Euro-Dollar Rate Advance in the Designated Euro-Dollar Market.
2.4 Letters of Credit.
(a) Subject to the terms and conditions hereof, at any
time and from time to time from the Closing Date through the Business
Day immediately prior to the Revolver Maturity Date, the Issuing Lender
shall issue such Letters of Credit under the Revolving Commitment as
the Borrower may request by a Request for Letter of Credit; provided
that (i) giving effect to all such Letters of Credit and the Revolving
Usage shall not exceed the then Revolving Commitment, and (ii) the
Aggregate Effective Amount of all outstanding Letters of Credit shall
not exceed $20,000,000. Each Letter of Credit shall be in a form
acceptable to the Issuing Lender. Unless all the Lenders otherwise
consent, no Letter of Credit shall have a term which exceeds one year
or extends beyond the Revolver Maturity Date.
(b) Each Request for a Letter of Credit shall be
submitted to the Issuing Lender, with a copy to the Administrative
Agent, at least five Business Days prior to the date upon which the
related Letter of Credit is proposed to be issued. The Administrative
Agent shall promptly notify the Issuing Lender whether such Request for
Letter of Credit, and the issuance of a Letter of Credit pursuant
thereto, conforms to the requirements of
30
this Agreement. Upon issuance of a Letter of Credit, the Issuing Lender
shall promptly notify the Administrative Agent, and the Administrative
Agent shall promptly notify the Lenders, of the amount and terms
thereof.
(c) Upon the issuance of a Letter of Credit, each Lender
which owns a Pro Rata Share of the Revolving Commitment shall be deemed
to have purchased at par a pro rata participation in such Letter of
Credit from the Issuing Lender in an amount equal to that Lender's Pro
Rata Share of the Revolving Commitment. Without limiting the scope and
nature of each Lender's participation in any Letter of Credit, to the
extent that the Issuing Lender has not been reimbursed by the Borrower
for any payment required to be made by the Issuing Lender under any
Letter of Credit, each Lender shall, pro rata according to its Pro Rata
Share of the Revolving Commitment, pay the purchase price for such
participation to the Issuing Lender through the Administrative Agent
promptly upon demand therefor. The obligation of each Lender to so pay
the participation purchase price to the Issuing Lender shall be
absolute and unconditional and shall not be affected by the occurrence
of an Event of Default or any other occurrence or event. Any such
payment of the purchase price shall not relieve or otherwise impair the
obligation of the Borrower to reimburse the Issuing Lender for the
amount of any payment made by the Issuing Lender under any Letter of
Credit together with interest as hereinafter provided.
(d) The Borrower shall pay to the Issuing Lender through
the Administrative Agent an amount equal to any payment made by the
Issuing Lender with respect to each Letter of Credit upon demand made
by the Issuing Lender therefor, together with interest on such amount
from the date of any payment made by the Issuing Lender at the Default
Rate (unless the Borrower has made arrangements for the making of a
Loan in the amount of such payment on the date thereof or had otherwise
arranged for the timely reimbursement of such payment). The principal
amount of any such payment shall be used to reimburse the Issuing
Lender for the payment made by it under the Letter of Credit and, to
the extent that the Lenders have not reimbursed the Issuing Lender
pursuant to Section 2.4(c), the interest amount of any such payment
shall be for the account of the Issuing Lender. Each Lender that has
paid the participation purchase price to the Issuing Lender pursuant to
Section 2.4(c) shall thereupon acquire a pro rata participation, to the
extent of such payment, in the claim of the Issuing Lender against the
Borrower for reimbursement of principal and interest under this Section
2.4(d) and shall share, in accordance with that pro rata participation,
in any principal payment made by the Borrower with respect to such
claim and in any interest payment made by the Borrower (but only with
respect to periods subsequent to the date such Lender paid the
participation purchase price to the Issuing Lender) with respect to
such claim.
(e) Subject to Article 8, the Borrower may request,
pursuant to a Request for Loan, that Advances be made pursuant to
Section 2.1(a) to provide funds for the payment required by Section
2.4(d). The proceeds of such Advances shall be paid directly to the
Issuing Lender to reimburse it for the payment made by it under the
Letter of Credit.
(f) If the Borrower fails to make the payment required by
Section 2.4(d) on a timely basis then, in lieu of the payment of the
participation purchase price to the Issuing Lender under Section
2.4(c), the Issuing Lender may (but is not required to), without
31
notice to or the consent of the Borrower, instruct the Administrative
Agent to cause Advances to be made by the Lenders under their Pro Rata
Shares of the Revolving Commitment in an aggregate amount equal to the
amount paid by the Issuing Lender with respect to that Letter of Credit
and, for this purpose, the conditions precedent set forth in Article 8
shall not apply. The proceeds of such Advances shall be paid directly
to the Issuing Lender to reimburse it for the payment made by it under
the Letter of Credit.
(g) The issuance of any supplement, modification,
amendment, renewal, or extension to or of any Letter of Credit shall be
treated in all respects the same as the issuance of a new Letter of
Credit, provided that no new issuance fees shall be assessed except to
the extent that the tenor or amount of the related Letter of Credit are
thereby increased.
(h) The obligation of the Borrower to pay to the Issuing
Lender the amount of any payment made by the Issuing Lender under any
Letter of Credit shall be absolute, unconditional, and irrevocable,
subject only to performance by the Issuing Lender of its obligations to
the Borrower under Uniform Commercial Code Sections 5108 and 5109.
Without limiting the foregoing, the obligations of the Borrower to the
Issuing Lender shall not be affected by any of the following
circumstances:
(i) any lack of validity or enforceability of
the Letter of Credit, this Agreement, or any other agreement or
instrument relating thereto;
(ii) any amendment or waiver of or any consent to
departure from the Letter of Credit, this Agreement, or any other
agreement or instrument relating thereto, with the consent of the
Borrower;
(iii) the existence of any claim, setoff, defense,
or other rights which the Borrower may have at any time against the
Issuing Lender, the Administrative Agent or any Lender, any beneficiary
of the Letter of Credit (or any persons or entities for whom any such
beneficiary may be acting) or any other Person, whether in connection
with the Letter of Credit, this Agreement, or any other agreement or
instrument relating thereto, or any unrelated transactions;
(iv) any demand, statement, or any other document
presented under the Letter of Credit proving to be forged, fraudulent
or invalid or any statement therein being untrue or inaccurate in any
respect whatsoever so long as any such document appeared to comply with
the terms of the Letter of Credit;
(v) payment by the Issuing Lender in good faith
under the Letter of Credit against presentation of a draft or any
accompanying document which does not strictly comply with the terms of
the Letter of Credit;
(vi) the existence, character, quality, quantity,
condition, packing, value or delivery of any Property purported to be
represented by documents presented in connection with any Letter of
Credit or any difference between any such Property and the character,
quality, quantity, condition, or value of such Property as described in
such documents;
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(vii) the time, place, manner, order or contents
of shipments or deliveries of Property as described in documents
presented in connection with any Letter of Credit or the existence,
nature and extent of any insurance relative thereto;
(viii) the solvency or financial responsibility of
any party issuing any documents in connection with a Letter of Credit;
(ix) any failure or delay in notice of shipments
or arrival of any Property;
(x) any error in the transmission of any message
relating to a Letter of Credit not caused by the Issuing Lender, or any
delay or interruption in any such message;
(xi) any error, neglect or default of any
correspondent of the Issuing Lender in connection with a Letter of
Credit;
(xii) any consequence arising from acts of God,
war, insurrection, civil unrest, disturbances, labor disputes,
emergency conditions or other causes beyond the control of the Issuing
Lender;
(xiii) so long as the Issuing Lender in good faith
determines that the contract or document appears to comply with the
terms of the Letter of Credit, the form, accuracy, genuineness or legal
effect of any contract or document referred to in any document
submitted to the Issuing Lender in connection with a Letter of Credit;
and
(xiv) where the Issuing Lender has acted in good
faith and observed general banking usage, any other circumstances
whatsoever.
(i) The Issuing Lender shall be entitled to the
protection accorded to the Administrative Agent pursuant to Article 10,
mutatis mutandis.
(j) The Uniform Customs and Practice for Documentary
Credits, as published in its most current version by the International
Chamber of Commerce, shall be deemed a part of this Section and shall
apply to all Letters of Credit to the extent not inconsistent with
applicable Law.
2.5 Swing Line. Subject to the terms and conditions set forth
herein, from the Closing Date through the day prior to the Revolver Maturity
Date, the Swing Line Lender shall make Swing Line Loans to the Borrower in such
amounts as the Borrower may request which do not result in the Revolving Usage
being in excess of the then effective Revolving Commitment, provided that (i)
after giving effect to each Swing Line Loan, the Swing Line Outstandings shall
not exceed $5,000,000 and (ii) without the consent of all of the Lenders, no
Swing Line Loan may be made during the continuation of an Event of Default. The
Borrower may borrow, repay and reborrow under this Section. Unless notified to
the contrary by the Swing Line Lender, borrowings under the Swing Line may be
made in amounts which are integral multiples of $100,000 upon telephonic request
by a Responsible Official of the Borrower made to the Administrative Agent not
later than 1:00 p.m., California local time, on the Business Day of the
33
requested borrowing (which telephonic request shall be promptly confirmed in
writing by telecopier), provided that if the requested Swing Line Loan is to be
credited to an account which is not with the Swing Line Lender, the request must
be submitted by 11:30 a.m., California local time. Promptly after receipt of
such a request for borrowing, the Administrative Agent shall provide telephonic
verification to the Swing Line Lender that, after giving effect to such request,
the Revolving Usage will not exceed the Revolving Commitment. Unless notified to
the contrary by the Swing Line Lender, each repayment of a Swing Line Loan shall
be in an amount which is an integral multiple of $100,000. If the Borrower
instructs the Swing Line Lender to debit its demand deposit account at the Swing
Line Lender in the amount of any payment with respect to a Swing Line Loan, or
the Swing Line Lender otherwise receives repayment, after 3:00 p.m., California
local time, on a Business Day, such payment shall be deemed received on the next
Business Day. The Swing Line Lender shall promptly notify the Administrative
Agent of the Swing Line Outstandings each time there is a change therein under
the Swing Line.
(a) Swing Line Loans shall bear interest at a fluctuating
rate per annum equal to the Base Rate plus the Revolver Base Rate
Margin (unless the Default Rate is then applicable under Section 3.8).
Interest shall be payable on such dates, not more frequent than
monthly, as may be specified by the Swing Line Lender and in any event
on the Revolver Maturity Date. The Swing Line Lender shall be
responsible for invoicing the Borrower for such interest. Interest
payable on Swing Line Loans is solely for the account of the Swing Line
Lender (subject to clause (d) below).
(b) The Swing Line Loans shall be payable within five
Business Days after demand made by the Swing Line Lender and in any
event on the Revolver Maturity Date or any earlier date when all other
Obligations are due.
(c) Upon the making of a Swing Line Loan in accordance
with Section 2.5(a), each Lender shall be deemed to have purchased from
the Swing Line Lender a participation therein in an amount equal to
that Lender's Pro Rata Share times the amount of the Swing Line Loan.
Upon demand made by the Swing Line Lender through the Administrative
Agent, each Lender shall, according to its Pro Rata Share, promptly
provide to the Swing Line Lender its purchase price therefor in an
amount equal to its participation therein. The obligation of each
Lender to so provide its purchase price to the Swing Line Lender shall
be absolute and unconditional (subject only to the making of a demand
upon that Lender by the Swing Line Lender) and shall not be affected by
the occurrence of a Default or Event of Default; provided that no
Lender shall be obligated to purchase its Pro Rata Share of (i) Swing
Line Loans to the extent that Swing Line Outstandings are in excess of
$5,000,000 or to the extent that the Revolving Usage exceeds the
Revolving Commitment (as in effect on the date of the making of the
related Swing Line Loan) and (ii) any Swing Line Loan made (absent the
consent of all of the Lenders) during the continuation of an Event of
Default. Each Lender that has provided the purchase price due for its
participation in Swing Line Loans to the Swing Line Lender shall
thereupon acquire a pro rata participation, to the extent of such
payment, in the claim of the Swing Line Lender against the Borrower for
principal and interest and shall share, in accordance with that pro
rata participation, in any principal payment made by the
34
Borrower with respect to such claim and in any interest payment made by
the Borrower (but only with respect to periods subsequent to the date
such Lender paid the Swing Line Lender its purchase price) with respect
to such claim.
(d) Upon any demand for payment of any Swing Line Loans
then outstanding by the Swing Line Lender (unless the Borrower has made
other arrangements acceptable to the Swing Line Lender to repay the
Swing Line Loans then outstanding) or on the date that is five (5)
Business Days following the date of incurrence of any Swing Line Loan,
the Borrower shall request a Loan pursuant to Section 2.1(a) sufficient
to repay such Swing Line Loans (and, for this purpose, Section 2.1(f)
shall not apply). In each case, the Administrative Agent shall
automatically provide the respective Advances made by each Lender to
the Swing Line Lender (which the Swing Line Lender shall then apply to
the Swing Line Loans then outstanding). In the event that the Borrower
fails to request a Loan within the time specified by Section 2.2 on any
such date, the Administrative Agent may, but is not required to,
without notice to or the consent of the Borrower, cause Advances to be
made by the Lenders under the Revolving Commitment in amounts which are
sufficient to repay the Swing Line Loans as required above. The
conditions precedent set forth in Article 8 shall not apply to Advances
to be made by the Lenders pursuant to the three preceding sentences.
The proceeds of such Advances shall be paid directly to the Swing Line
Lender for application to the Swing Line Loans.
2.6 Voluntary Reduction of Revolving Commitment. The Borrower
shall have the right, at any time and from time to time, without penalty or
charge, effective following at least five Business Days' prior written notice by
a Responsible Official of the Borrower to the Administrative Agent, voluntarily
to reduce, permanently and irrevocably, in aggregate principal amounts in an
integral multiple of $1,000,000 but not less than $5,000,000, or to terminate,
all or a portion of the then undisbursed portion of the Revolving Commitment;
provided that the Revolving Commitment may not be so reduced below an amount
equal to the sum of (i) the aggregate principal amount outstanding under the
Revolving Notes, plus (ii) the Aggregate Effective Amount of all outstanding
Letters of Credit plus (iii) the Swing Line Outstandings, in each case as of the
effective date of the reduction in the Revolving Commitment. Any voluntary
reduction of the Revolving Commitment by the Borrower under this Section shall
have no effect upon the requirement of mandatory reductions thereof in
accordance with Section 2.7. The Administrative Agent shall promptly notify the
Lenders of any reduction or termination of the Commitments under this Section.
2.7 Mandatory Reductions of the Revolving Commitments.
(a) The Revolving Commitment shall automatically and
permanently reduce:
(i) on the date of a Disposition made pursuant
to Section 6.2(g) in an amount equal to the product of (1) the
Revolving Commitment Percentage multiplied by (2) 100% of the Net Cash
Proceeds of all such Dispositions in such fiscal year in excess of
$2,500,000;
(ii) on the date upon which the Borrower or its
Subsidiaries receive the proceeds of the issuance of any Indebtedness
of the types contemplated by Section 6.9(g), in an amount equal to the
product of (1) the Revolving Commitment Percentage
35
multiplied by (2) 100% of the net proceeds to the Borrower and its
Subsidiaries of all such Indebtedness in excess of $100,000,000; and
(iii) on the date upon which the Borrower or any
of its Subsidiaries receive the proceeds of the issuance of any equity
securities, in an amount equal to the product of (1) the Revolving
Commitment Percentage multiplied by (2) 50% of the Net Cash Proceeds
thereof.
(b) The Revolving Commitment shall automatically and
permanently reduce on the dates and in the amounts set forth in the
definition of "Revolver Reduction Amount".
2.8 Optional Increases to the Revolving Commitment and/or the Term
Loans. Following the Closing Date, the Borrower may from time to time through
the Revolver Maturity Date or the Term Maturity Date, as applicable, propose to
increase the aggregate amount of the Revolving Commitment or the Term Loans in
accordance with this Section. The aggregate principal amount of the increases to
the Revolving Commitment and the Term Loans made pursuant to this Section (the
amount of any such increase, the "Increased Revolving Commitment" or "Increased
Term Loan", as applicable), shall not exceed $75,000,000. The Borrower shall
provide at least 15 days' notice to the Joint Lead Arrangers (or such shorter
period as the Joint Lead Arrangers may agree to accept) of any requested
increase in the Revolving Commitment or increase in the Term Loan.
(a) The Borrower may designate any Lender party to this
Agreement (with the consent of such Lender, which may be given or
withheld in its sole discretion) or another Person which qualifies as
an Eligible Assignee (which may be, but need not be, existing Lenders)
which at the time agrees to (i) in the case of any such designated
Lender that is an existing Lender, increase its Pro Rata Share of the
Revolving Commitment or its Term Loans, as applicable, and (ii) in the
case of any other such Person (an "Additional Lender"), become a party
to this Agreement. The sum of the increases in the Pro Rata Shares of
the Revolving Commitment and the Term Loans of the existing Lenders
pursuant to this subsection (b) plus the new commitments of the
Additional Lenders shall not in the aggregate exceed the unsubscribed
amount of the Increased Revolving Commitment and the Increased Term
Loans.
(b) An increase in the aggregate amount of the Revolving
Commitment or the Term Loans pursuant to this Section shall become
effective upon the receipt by the Joint Lead Arrangers of an agreement
in form and substance satisfactory to the Joint Lead Arrangers signed
by the Borrower, by each Additional Lender and by each other applicable
Lender whose Pro Rata Share of the Revolving Commitment or the Term
Loans is to be increased, setting forth the new Pro Rata Shares of the
Revolving Commitment or the Term Loans of such Lenders and setting
forth the agreement of each Additional Lender to become a party to this
Agreement and to be bound by all the terms and provisions hereof,
together with such evidence of appropriate corporate authorization on
the part of the Borrower with respect to the Increased Revolving
Commitment or the
36
Increased Term Loans, as applicable, amendments to any Loan Documents
requested by the Joint Lead Arrangers in relation to the Increased
Revolving Commitment or the Increased Term Loans (which amendments the
Administrative Agent is hereby authorized to execute on behalf of the
Creditors) and such opinions of counsel for the Borrower with respect
to the Increased Revolving Commitments or the Increased Term Loans,
title endorsements and other assurances as the Joint Lead Arrangers may
reasonably request.
(c) Notwithstanding anything to the contrary herein, in
no event shall the interest rate payable on any Increased Revolving
Commitment or Increased Term Loan exceed the interest rate from time to
time payable on Revolving Loans or Term Loans, respectively.
2.9 Administrative Agent's Right to Assume Funds Available for
Advances. Unless the Administrative Agent shall have been notified by any Lender
no later than 10:00 a.m. on the Business Day of the proposed funding by the
Administrative Agent of any Loan that such Lender does not intend to make
available to the Administrative Agent such Lender's portion of the total amount
of such Loan, the Administrative Agent may assume that such Lender has made such
amount available to the Administrative Agent on the date of the Loan and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower the corresponding amount. If the Administrative Agent has made
funds available to the Borrower based on such assumption and such corresponding
amount is not in fact made available to the Administrative Agent by such Lender,
the Administrative Agent shall be entitled to recover such corresponding amount
on demand from such Lender. If such Lender does not pay such corresponding
amount forthwith upon the Administrative Agent's demand therefor, the
Administrative Agent promptly shall notify the Borrower who shall pay such
corresponding amount to the Administrative Agent. The Administrative Agent also
shall be entitled to recover from such Lender interest on such corresponding
amount in respect of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower to the date such
corresponding amount is recovered by the Administrative Agent, at a rate per
annum equal to the daily Federal Funds Rate. Nothing herein shall be deemed to
relieve any Lender from its obligation to fulfill its Pro Rata Shares
Commitments.
2.10 Senior Indebtedness. The Obligations hereby are designated by
the Borrower as "Senior Indebtedness" and "Designated Senior Indebtedness" with
respect to all Indebtedness and other obligations of the Borrower and its
Subsidiaries under or in respect of the Existing Senior Subordinated Notes and
the indenture executed in connection therewith. The Obligations shall be and
hereby are designated by the Borrower as "Senior Indebtedness" and "Designated
Senior Indebtedness" under or in respect of any other Subordinated Obligations
incurred from time to time after the Closing Date, to the extent of the
subordination provisions set forth in the instruments and agreements governing
such Subordinated Obligations.
2.11 Collateral. The Obligations shall be secured by a first
priority (subject to Liens permitted by Section 6.8) perfected Lien on the
Collateral pursuant to the Collateral Documents.
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ARTICLE 3
PAYMENTS AND FEES
3.1 Principal and Interest.
(a) Interest shall be payable on the outstanding daily unpaid
principal amount of each Advance from the date thereof until payment in full is
made and shall accrue and be payable at the rates set forth or provided for
herein before and after any Default or Event of Default, before and after
maturity, before and after judgment, and before and after the commencement of
any proceeding under any Debtor Relief Law, with interest on overdue interest at
the Default Rate to the fullest extent permitted by applicable Laws.
(b) Interest accrued on Base Rate Loans shall be due and payable
on each Quarterly Payment Date. Except as otherwise provided in Section 3.8, the
unpaid principal amount of each Base Rate Loan shall bear interest at a
fluctuating rate per annum (a) in the case of each Term Loan, equal to the Base
Rate plus the applicable Term Base Rate Margin, and (b) in the case of each
Revolving Loan equal to the Base Rate plus the applicable Revolver Base Rate
Margin. Each change in the interest rate under this Section 3.1(b) due to a
change in the Base Rate shall take effect simultaneously with the corresponding
change in the Base Rate.
(c) Interest accrued on each Euro-Dollar Rate Loan which is for a
term of three months or less shall be due and payable on the last day of the
related Interest Period. Interest accrued on each other Euro-Dollar Rate Loan
shall be due and payable on the date which is three months after the date such
Euro-Dollar Rate Loan was made (and, in the event that all of the Lenders have
approved an Interest Period of longer than six months, every three months
thereafter through the last day of the Interest Period) and on the last day of
the related Interest Period. Except as otherwise provided in Section 3.8, the
unpaid principal amount of any Euro-Dollar Rate Loan shall bear interest at a
rate per annum (a) in the case of each Term Loan, equal to the Euro-Dollar Rate
for that Euro-Dollar Rate Loan plus the applicable Term Euro-Dollar Margin, and
(b) in the case of each Revolving Loan equal to the Euro-Dollar Rate for that
Euro-Dollar Rate Loan plus the applicable Revolver Euro-Dollar Margin.
(d) If not sooner paid, the principal Indebtedness evidenced by
the Notes shall be payable as follows, and without set off, counterclaim or
reduction of any kind:
(i) the amount, if any, by which the Revolving Usage at
any time exceeds the then applicable Revolving Commitment (as reduced from time
to time pursuant to Sections 2.6 or 2.7 or increased from time to time pursuant
to Section 2.8), shall be payable immediately;
(ii) The principal Indebtedness evidenced by the Term
Notes shall be payable on each Quarterly Payment Date, commencing September 30,
2004, in an amount equal to the lesser of (1) the aggregate principal amount of
Term Loans then outstanding or (2) the sum of $687,500 plus an amount equal to
0.25% of any incremental increase in the Term Loans after the Closing Date
pursuant to Section 2.8;
38
(iii) On the date of a Disposition made pursuant to Section
6.2(g), the principal Indebtedness evidenced by the Term Notes shall be payable
in an amount equal to the lesser of (1) the aggregate principal amount of Term
Loans then outstanding or (2) the product of (A) the Term Loan Percentage
multiplied by (B) 100% of the Net Cash Proceeds of all such Dispositions in such
fiscal year in excess of $2,500,000;
(iv) On the date upon which the Borrower or its
Subsidiaries receive the proceeds of the issuance of any Indebtedness of the
types contemplated by Section 6.9(g), the principal Indebtedness evidenced by
the Term Notes shall be payable in an amount equal to the lesser of (1) the
aggregate principal of Term Loans then outstanding or (2) the product of (A) the
Term Loan Percentage multiplied by (B) 100% of the net proceeds to the Borrower
and its Subsidiaries of such Indebtedness in excess of $100,000,000;
(v) On the date upon which the Borrower or any of its
Subsidiaries receive the proceeds of the issuance of any equity securities, the
principal Indebtedness evidenced by the Term Notes shall be payable in an amount
equal to the lesser of (1) the aggregate principal amount of Term Loans then
outstanding or (2) the product of (A) the Term Loan Percentage multiplied by (B)
50% of the Net Cash Proceeds thereof;
(vi) If the Total Leverage Ratio is equal to or greater
than 3.00:1.00, on a pro forma basis, on the date upon which any Disposition of
the type contemplated by Section 6.2(c) occurs,
(1) the principal Indebtedness evidenced by the Revolving
Notes shall be payable in an amount equal to the lesser of (A) the
aggregate principal amount of Revolving Loans then outstanding or (B)
the sum of (i) the product of the Revolving Commitment Percentage
multiplied by 100% of the first $10,000,000 of the Net Cash Proceeds of
such Disposition and (ii) the product of the Revolving Commitment
Percentage multiplied by 60% of the next $15,000,000 of Net Cash
Proceeds of such Disposition, and
(2) the principal Indebtedness evidenced by the Term
Notes shall be payable in an amount equal to the lesser of (A) the
aggregate principal amount of Term Loans then outstanding or (B) the
sum of (i) the product of the Term Loan Percentage multiplied by 100%
of the first $10,000,000 of the Net Cash Proceeds of such Disposition
and (ii) the product of the Term Loan Percentage multiplied by 60% of
the next $15,000,000 of Net Cash Proceeds of such Disposition.
(vii) If the Total Leverage Ratio is less than 3.00:1.00,
on a pro forma basis, on the date upon which a Disposition of any of the capital
stock of United Coin Machine Co., Plantation Investments, Inc. (d/b/a Rail City
Casino), Rainbow Casino Vicksburg Partnership LP (d/b/a Rainbow Casino) or Video
Services, Inc. or the sale of all or substantially all of the assets of any of
such Persons occurs, the Borrower may reinvest the Net Cash Proceeds of such
Disposition in its remaining business units so long as such reinvestment occurs
within 180 days after the receipt of such Net Cash Proceeds
39
(the "Reinvestment Period") and on the date that is 180 days after the receipt
of such Net Cash Proceeds,
(1) the principal Indebtedness evidenced by the Revolving
Notes shall be payable in an amount equal to the lesser of (A) the
aggregate principal amount of Revolving Loans then outstanding or (B)
the product of the Revolving Commitment Percentage multiplied by 50% of
the Net Cash Proceeds remaining after giving effect to any reinvestment
of such Net Cash Proceeds during the Reinvestment Period, and
(2) the principal Indebtedness evidenced by the Term
Notes shall be payable in an amount equal to the lesser of (A) the
aggregate principal amount of Term Loans then outstanding or (B) the
product of the Term Loan Percentage multiplied by 50% of the Net Cash
Proceeds remaining after giving effect to any reinvestment of such Net
Cash Proceeds during the Reinvestment Period.
(viii) If the Total Leverage Ratio is equal to or greater
than 3.00:1.00, on a pro forma basis, on the date upon which a Disposition of
any of the capital stock of the United Coin Machine Co., Plantation Investments,
Inc. (d/b/a Rail City Casino), Rainbow Casino Vicksburg Partnership LP (d/b/a
Rainbow Casino) or Video Services, Inc. or the sale of all or substantially all
of the assets of any such Persons occurs,
(1) the principal Indebtedness evidenced by the Revolving
Notes shall be payable in an amount equal to the lesser of (A) the
aggregate principal amount of Revolving Loans then outstanding or (B)
the product of the Revolving Commitment Percentage multiplied by an
amount of the Net Cash Proceeds received in such Disposition such that
after giving effect to the application of such Net Cash Proceeds to the
prepayment of the Indebtedness evidenced by the Notes in accordance
with this Section 3.1(d)(viii) the Total Leverage Ratio shall be less
than 3.00:1.00, on a pro forma basis (the "Designated Net Cash Proceeds
Amount"), and
(2) the principal Indebtedness evidenced by the Term
Notes shall be payable in an amount equal to the lesser of (A) the
aggregate principal amount of Term Loans then outstanding or (B) the
product of the Term Loan Percentage multiplied by the Designated Net
Cash Proceeds Amount.
Any remaining Net Cash Proceeds after repayment of the Indebtedness evidenced by
the Notes in accordance with this Section 3.1(d)(viii) may be reinvested in the
business units of the Borrower and its Subsidiaries in accordance with Section
3.1(d)(vii) and, if not so reinvested during the corresponding Reinvestment
Period, shall result in a repayment obligation in accordance with the provisions
of such Section.
(ix) the principal Indebtedness evidenced by the Revolving
Notes shall in any event be payable on the Revolver Maturity Date; and
(x) the principal Indebtedness evidenced by the Term
Notes shall in any event be payable on the Term Maturity Date.
40
(e) The Notes may, at any time and from time to time,
voluntarily be paid or prepaid in whole or in part without premium or
penalty, except that (i) with respect to any voluntary prepayment under
this Section 3.1(e) any partial prepayment shall be not less than
$2,500,000, or in integral multiples of $500,000 which are in excess of
$2,500,000, (ii) the Administrative Agent shall have received written
notice of any prepayment by 9:00 a.m., California local time, on the
Business Day prior to the date of prepayment (which must be a Business
Day) in the case of a Base Rate Loan, and, in the case of a Euro-Dollar
Rate Loan, three Euro-Dollar Business Days before the date of
prepayment, which notice shall identify the date and amount of the
prepayment and the Loan(s) being prepaid, (iii) each prepayment of
principal on any Euro-Dollar Rate Loan shall be accompanied by payment
of interest accrued to the date of payment on the amount of principal
paid and (iv) any payment or prepayment of all or any part of any
Euro-Dollar Rate Loan on a day other than the last day of the
applicable Interest Period shall be subject to Section 3.7(e). Promptly
following receipt of a notice of prepayment under clause (ii) above,
the Administrative Agent shall notify each Lender by telephone or
telecopier (and if by telephone, promptly confirmed by telecopier) of
the date and amount thereof.
(f) Each payment of principal by the Borrower hereunder
shall be applied ratably to the Advances made to the Borrower which are
then due and payable, provided that if the Obligations are then
accelerated or have deemed to have been accelerated, each payment of
principal hereunder shall be applied ratably to the outstanding
Advances.
3.2 Joint Lead Arranger's Fees. On the date hereof, the Borrower
shall pay to each Joint Lead Arranger through the Administrative Agent certain
fees in the amount heretofore agreed upon by letter agreement between the
Borrower and the Joint Lead Arrangers. These fees are for the services of the
Joint Lead Arrangers in arranging the credit facilities under this Agreement and
are fully earned when paid and are nonrefundable.
3.3 Commitment Fees. From the date hereof, the Borrower shall pay
to the Administrative Agent, for the ratable accounts of the Lenders pro rata
according to their Pro Rata Shares of the Revolving Commitment, a commitment fee
equal to the Commitment Fee Rate in effect from time to time times the actual
daily amount by which the Revolving Commitment exceeds the Revolving Usage
(other than the Swing Line Outstandings). The commitment fee shall be payable
quarterly in arrears on each Quarterly Payment Date, on the Revolver Maturity
Date and upon the date of any partial reduction or termination of the Revolving
Commitment pursuant to Sections 2.6 or 2.7.
3.4 Letter of Credit Fees. Concurrently with the issuance of each
Letter of Credit, the Borrower shall pay a letter of credit issuance fee to the
Issuing Bank, for the sole account of the Issuing Bank, in an amount set forth
in a letter agreement between the Borrower and the Issuing Bank. Each letter of
credit issuance fee is nonrefundable. On each Quarterly Payment Date and on the
Revolver Maturity Date, the Borrower shall also pay to the Administrative Agent
in arrears, for the ratable account of the Lenders in accordance with their Pro
Rata Share, letter of credit fees in an amount equal to the Letter of Credit Fee
per annum times the actual daily Aggregate Effective Amount of all Letters of
Credit for the period from the Closing Date or the most recent Quarterly Payment
Date. All letter of credit fees shall also be non-refundable.
41
3.5 Administrative Fees. On the date hereof and annually
thereafter, the Borrower shall pay to the Administrative Agent an administrative
fee in such amounts as heretofore agreed upon by letter agreement between the
Borrower and Bank of America and the Joint Lead Arrangers. The administrative
fee is for the services to be performed by the Administrative Agent in acting as
Administrative Agent and is fully earned on the date paid. The administrative
fee paid to the Administrative Agent is solely for its own account and is
nonrefundable.
3.6 Increased Commitment Costs. If any Lender shall determine in
good faith that the introduction after the date hereof of any applicable law,
rule, regulation or guideline regarding capital adequacy, or any change therein
or any change in the interpretation or administration thereof by any central
bank or other Governmental Agency charged with the interpretation or
administration thereof, or change in the manner of compliance by such Lender (or
its Euro-Dollar Lending Office) or any corporation controlling the Lender, with
any request, guideline or directive regarding capital adequacy (whether or not
having the force of Law) of any such central bank or other authority, affects or
would affect the amount of capital required or expected to be maintained by such
Lender or any corporation controlling such Lender and (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy
and such Lender's desired return on capital) determines in good faith that the
amount of such capital is increased, or the rate of return on capital is
reduced, as a consequence of its obligations under this Agreement, then, within
ten Business Days after demand of such Lender, the Borrower shall pay to such
Lender, from time to time as specified in good faith by such Lender, additional
amounts sufficient to compensate such Lender in light of such circumstances, to
the extent reasonably allocable to such obligations under this Agreement.
Notwithstanding the foregoing, the Borrower shall not be required to reimburse
any Lender for any increased costs, reductions or payments under this Section
arising prior to 90 days preceding the date of any claim or demand by that
Lender for compensation under this Section except to the extent the applicable
law or regulation is imposed retroactively and the demand or claim is made
within 90 days of the effect (in which case such claim or demand shall be
submitted within 90 days of the date upon which such Lender becomes aware or
should reasonably be aware of such law or regulation). Each Lender's
determination of such amounts shall be conclusive in the absence of manifest
error. Any request for compensation by a Lender under this Section shall set
forth the basis upon which it has been determined that such an amount is due
from the Borrower, a calculation of the amount due, and a certification that the
corresponding costs or diminished rate of return on capital have been incurred
or sustained by the Lender.
3.7 Euro-Dollar Costs and Related Matters.
(a) In the event that any Governmental Agency imposes on
any Lender any reserve or comparable requirement (including any
emergency, supplemental or other reserve) with respect to the
Euro-Dollar Obligations of that Lender, the Borrower shall pay that
Lender within 5 Business Days after demand all amounts necessary to
compensate such Lender (determined as though such Lender's Euro-Dollar
Lending Office had funded 100% of its Euro-Dollar Rate Advance in the
Designated Euro-Dollar Market) in respect of the imposition of such
reserve requirements. The Lender's determination of such amount shall
be conclusive in the absence of manifest error.
42
(b) If, after the date hereof, the existence or
occurrence of any Special Euro-Dollar Circumstance:
(1) shall subject any Lender or its Euro-Dollar
Lending Office to any tax, duty or other charge or cost with
respect to any Euro-Dollar Rate Advance, any of its Notes
evidencing Euro-Dollar Rate Advances or its obligation to make
Euro-Dollar Rate Advances, or shall change the basis of
taxation of payments to any Lender attributable to the
principal of or interest on any Euro-Dollar Rate Advance or
any other amounts due under this Agreement in respect of any
Euro-Dollar Rate Advance, any of its Notes evidencing
Euro-Dollar Rate Advances or its obligation to make
Euro-Dollar Rate Advances, excluding (i) taxes imposed on or
measured in whole or in part by its overall net income, gross
income or gross receipts, (ii) franchise taxes imposed by (A)
any jurisdiction (or political subdivision thereof) in which
it is organized or maintains its principal office or
Euro-Dollar Lending Office or (B) any jurisdiction (or
political subdivision thereof) in which it is "doing
business," and (iii) any withholding taxes or other taxes
based on gross income imposed by the United States of America
for any period with respect to which it has failed to provide
the Borrower with the appropriate form or forms required by
Section 11.21, to the extent such forms are then required by
applicable Laws to avoid withholding tax payments;
(2) shall impose, modify or deem applicable any
reserve not applicable or deemed applicable on the date hereof
(including any reserve imposed by the Board of Governors of
the Federal Reserve System, special deposit, capital or
similar requirements against assets of, deposits with or for
the account of, or credit extended by, any Lender or its
Euro-Dollar Lending Office); or
(3) shall impose on any Lender or its
Euro-Dollar Lending Office or the Designated Euro-Dollar
Market any other condition affecting any Euro-Dollar Rate
Advance, any of its Notes evidencing Euro-Dollar Rate
Advances, its obligation to make Euro-Dollar Rate Advances or
this Agreement, or shall otherwise affect any of the same;
and the result of any of the foregoing, as determined in good faith by
such Lender, increases the cost to such Lender or its Euro-Dollar
Lending Office of making or maintaining any Euro-Dollar Rate Advance or
in respect of any Euro-Dollar Rate Advance, any of its Notes evidencing
Euro-Dollar Rate Advances or its obligation to make Euro-Dollar Rate
Advances or reduces the amount of any sum received or receivable by
such Lender or its Euro-Dollar Lending Office with respect to any
Euro-Dollar Rate Advance, any of its Notes evidencing Euro-Dollar Rate
Advances or its obligation to make Euro-Dollar Rate Advances (assuming
such Lender's Euro-Dollar Lending Office had funded 100% of its
Euro-Dollar Rate Advance in the Designated Euro-Dollar Market), then,
within five Business Days after demand by such Lender (with a copy to
the Administrative Agent), the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender for such
increased cost or reduction (determined as though such Lender's
Euro-Dollar Lending Office had funded 100% of its Euro-Dollar Rate
Advance in the Designated Euro-Dollar Market). A
43
statement of any Lender claiming compensation under this subsection and
setting forth in reasonable detail the additional amount or amounts to
be paid to it hereunder shall be conclusive in the absence of manifest
error. Notwithstanding the foregoing, the Borrower shall not be
required to reimburse any Lender for any increased costs, reductions or
payments under this clause (b) arising prior to 90 days preceding the
date of any claim or demand by that Lender for compensation under this
clause (b) except to the extent the circumstances giving rise thereto
result in retroactive imposition of the related costs and the demand or
claim is made within 90 days of the effect (in which case such claim or
demand shall be submitted within 90 days of the date upon which such
Lender becomes aware or should reasonably be aware of such effect).
(c) If, after the date hereof, the existence or
occurrence of any Special Euro-Dollar Circumstance shall, in the good
faith opinion of any Lender, make it unlawful or impossible for such
Lender or its Euro-Dollar Lending Office to make, maintain or fund its
portion of any Euro-Dollar Rate Advance or materially restrict the
authority of such Lender to purchase or sell, or to take deposits of,
Dollars in the Designated Euro-Dollar Market, or to determine or charge
interest rates based upon the Euro-Dollar Rate, and such Lender shall
so notify the Administrative Agent, then such Lender's obligation to
make Euro-Dollar Rate Advances shall be suspended for the duration of
such illegality or impossibility and the Administrative Agent forthwith
shall give notice thereof to the other Lenders and the Borrower. Upon
receipt of such notice, the outstanding principal amount of such
Lender's Euro-Dollar Rate Advances, together with accrued interest
thereon, automatically shall be converted to Base Rate Advances on
either (1) the last day of the Interest Period(s) applicable to such
Euro-Dollar Rate Advances if such Lender may lawfully continue to
maintain and fund such Euro-Dollar Rate Advances to such day(s) or (2)
immediately if such Lender may not lawfully continue to fund and
maintain such Euro-Dollar Rate Advances to such day(s), provided that
in such event the conversion shall not be subject to payment of a
prepayment fee under clause (e) of this Section. Each Lender agrees to
endeavor promptly to notify the Borrower of any event of which it has
actual knowledge, occurring after the date hereof, which will cause
that Lender to notify the Administrative Agent under this Section, and
agrees to designate a different Euro-Dollar Lending Office if such
designation will avoid the need for such notice and will not, in the
good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender. In the event that any Lender is unable,
for the reasons set forth above, to make, maintain or fund its portion
of any Euro-Dollar Rate Loan or Advance, such Lender shall fund such
amount as a Base Rate Advance for the same period of time, and such
amount shall be treated in all respects as a Base Rate Advance. Any
Lender whose obligation to make Euro-Dollar Rate Advances has been
suspended under this Section shall promptly notify the Administrative
Agent and the Borrower of the cessation of the Special Euro-Dollar
Circumstance which gave rise to such suspension.
(d) If, with respect to any proposed Euro-Dollar Rate
Loan:
(1) the Administrative Agent reasonably
determines that, by reason of circumstances affecting the
Designated Euro-Dollar Market generally that are beyond the
reasonable control of the Lenders, deposits in Dollars (in the
44
applicable amounts) are not being offered to any Lender in the
Designated Euro-Dollar Market for the applicable Interest
Period; or
(2) the Requisite Lenders advise the
Administrative Agent that the Euro-Dollar Rate as determined
by the Administrative Agent (i) does not represent the
effective pricing to such Lenders for deposits in Dollars in
the Designated Euro-Dollar Market in the relevant amount for
the applicable Interest Period, or (ii) will not adequately
and fairly reflect the cost to such Lenders of making the
applicable Euro-Dollar Rate Advances;
then the Administrative Agent forthwith shall give notice thereof to
the Borrower and the Lenders, whereupon until the Administrative Agent
notifies the Borrower that the circumstances giving rise to such
suspension no longer exist, the obligation of the Lenders to make any
future Euro-Dollar Rate Advances to the Borrower shall be suspended.
(e) Upon payment or prepayment of any Euro-Dollar Rate
Advance (other than as the result of a conversion required under clause
(c) of this Section) on a day other than the last day in the applicable
Interest Period (whether voluntarily, involuntarily, by reason of
acceleration, or otherwise), or upon the failure of the Borrower (for a
reason other than the failure of a Lender to make an Advance) to borrow
on the date or in the amount specified for a Euro-Dollar Rate Advance
in any Request for Loan, or upon the failure of the Borrower to prepay
a Euro-Dollar Rate Loan or Advance on the date specified in a notice of
prepayment delivered to the Administrative Agent pursuant to Section
3.1(e), the Borrower shall pay to the appropriate Lender within ten
Business Days after demand a prepayment fee, failure to borrow fee or
failure to prepay fee, as the case may be (determined as though 100% of
that Lender's Euro-Dollar Rate Advance had been funded in the
Designated Euro-Dollar Market), equal to the sum of:
(1) the principal amount of the Euro-Dollar Rate
Advance prepaid or not borrowed or prepaid, as the case may
be, times the number of days from and including the date of
prepayment or failure to borrow or prepay, as applicable, to
but excluding the last day in the applicable Interest Period,
divided by 360, times the applicable Interest Differential
(provided that the product of the foregoing formula must be a
positive number); plus
(2) all out-of-pocket expenses incurred by the
Lender reasonably attributable to such payment, prepayment or
failure to borrow.
Each Lender's determination of the amount of any prepayment fee,
failure to borrow fee or failure to prepay fee payable under this
Section shall be conclusive in the absence of manifest error.
(f) Each Lender agrees to endeavor promptly to notify the
Borrower of any event of which it has actual knowledge, occurring after
the date hereof, which will entitle such Lender to compensation
pursuant to clause (a) or clause (b) of this Section, and agrees to
designate a different Euro-Dollar Lending Office if such designation
will avoid
45
the need for or reduce the amount of such compensation and will not, in
the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender. Any request for compensation by a
Lender under this Section shall set forth the basis upon which it has
been determined that such an amount is due from the Borrower, a
calculation of the amount due, and a certification that the
corresponding costs have been incurred by the Lender.
(g) If any Lender claims compensation or is excused from
making or continuing Euro-Dollar Rate Loans or Advances under this
Section, the Borrower may at any time, upon at least 4 Euro-Dollar
Business Days' prior notice to the Administrative Agent and such Lender
and upon payment in full of the amounts provided for in this Section
through the date of such payment plus any prepayment fee (subject to
clause (c) of this Section) required by clause (e) of this Section, pay
in full the affected Euro-Dollar Rate Advances of such Lender or
request that such Euro-Dollar Rate Advances be converted to Base Rate
Advances.
3.8 Default Rate. If any installment of principal or interest or
any fee or cost or other amount payable under any Loan Document to the
Administrative Agent or any Lender is not paid when due, or at the option of the
Requisite Lenders upon the occurrence and during the continuance of any Event of
Default, the outstanding Loans, and any such delinquent fees, costs or other
amounts, shall thereafter bear interest at a rate which is 2% per annum in
excess of the otherwise applicable rate, and the outstanding Letters of Credit
shall thereafter accrue fees at a rate which is 2% per annum in excess of the
otherwise applicable fees, in each case to the fullest extent permitted by
applicable Laws. Accrued and unpaid interest on past due amounts (including
interest on past due interest) shall be compounded monthly, on the last day of
each calendar month, to the fullest extent permitted by applicable Laws.
3.9 Computation of Interest and Fees. Computation of interest on
Base Rate Loans shall be calculated on the basis of a year of 365 or 366 days,
as the case may be, and the actual number of days elapsed; computation of
interest on Euro-Dollar Rate Loans and all fees under this Agreement shall be
calculated on the basis of a year of 360 days and the actual number of days
elapsed. The Borrower acknowledges that such latter calculation method will
result in a higher yield to the Lenders than a method based on a year of 365 or
366 days. Interest shall accrue on each Loan for the day on which the Loan is
made; interest shall not accrue on a Loan, or any portion thereof, for the day
on which the Loan or such portion is paid. Any Loan that is repaid on the same
day on which it is made shall bear interest for one day. Notwithstanding
anything in this Agreement to the contrary, interest in excess of the maximum
amount permitted by applicable Laws shall not accrue or be payable hereunder or
under the Notes, and any amount paid as interest hereunder or under the Notes
which would otherwise be in excess of such maximum permitted amount shall
instead be treated as a payment of principal.
3.10 Non-Business Days. If any payment to be made by the Borrower
or any other Party under any Loan Document shall come due on a day other than a
Business Day, payment shall instead be considered due on the next succeeding
Business Day and the extension of time shall be reflected in computing interest
and fees.
46
3.11 Manner and Treatment of Payments.
(a) Each payment hereunder (except payments pursuant to
Sections 3.7, 3.8, 11.3, 11.11 and 11.22) or on the Notes or under any
other Loan Document shall be made to the Administrative Agent, at the
Administrative Agent's Office, for the account of each of the Lenders
or the Administrative Agent, as the case may be, in immediately
available funds (by wire transfer, debit of an account with the
Administrative Agent or by other means acceptable to the Administrative
Agent) not later than 11:00 a.m. (other than payments with respect to
Swing Line Loans, which must be paid directly to the Swing Line Lender
and received by 3:00 p.m.), California local time, on the day of
payment (which must be a Business Day). All payments received after
such time, on any Business Day, shall be deemed received on the next
succeeding Business Day. The amount of all payments received by the
Administrative Agent for the account of each Lender shall be
immediately paid by the Administrative Agent to the applicable Lender
in immediately available funds and, if such payment was received by the
Administrative Agent by 11:00 a.m., California local time, on a
Business Day and not so made available to the account of a Lender on
that Business Day, the Administrative Agent shall reimburse that Lender
for the cost to such Lender of funding the amount of such payment at
the Federal Funds Rate. All payments shall be made in lawful money of
the United States of America.
(b) Each payment or prepayment on account of any Loan
shall be applied pro rata according to the outstanding Advances made by
each Lender comprising such Loan.
(c) Each Lender shall use its best efforts to keep a
record (which may be in tangible or electronic or other intangible
form) of Advances made by it and payments received by it with respect
to each of its Notes and, subject to Section 10.6(g), such record
shall, as against the Borrower, be presumptive evidence of the amounts
owing. Notwithstanding the foregoing sentence, the failure by any
Lender to keep such a record shall not affect the Borrower's obligation
to pay the Obligations.
(d) Each payment of any amount payable by the Borrower or
any other Party under this Agreement or any other Loan Document shall
be made free and clear of, and without reduction by reason of, any
taxes, assessments or other charges imposed by any Governmental Agency,
central bank or comparable authority, excluding (i) taxes imposed on or
measured in whole or in part by overall net income, gross income or
gross receipts, (ii) franchise taxes imposed on any Lender by (A) any
jurisdiction (or political subdivision thereof) in which it is
organized or maintains its principal office or Euro-Dollar Lending
Office or (B) any jurisdiction (or political subdivision thereof) in
which it is "doing business", (iii) any withholding taxes or other
taxes based on gross income imposed by the United States of America
that are not attributable to any change in any Law or the
interpretation or administration of any Law by any Governmental Agency
and (iv) any withholding tax or other taxes based on gross income
imposed by the United States of America for any period with respect to
which it has failed to provide the Borrower with the appropriate form
or forms required by Section 11.21 (all such non-excluded taxes,
assessments or other charges being hereinafter referred to as "Taxes").
To the extent that the Borrower or any other Party is obligated by
applicable Laws to
47
make any deduction or withholding on account of Taxes from any amount
payable to any Lender under this Agreement, they shall (i) make such
deduction or withholding and pay the same to the relevant Governmental
Agency and (ii) pay such additional amount to that Lender as is
necessary to result in that Lender's receiving a net after-Tax amount
equal to the amount to which that Lender would have been entitled under
this Agreement absent such deduction or withholding. If and when
receipt of such payment results in an excess payment or credit to that
Lender on account of such Taxes, that Lender shall promptly refund such
excess to the Borrower or the relevant Party.
3.12 Funding Sources. Nothing in this Agreement shall be deemed to
obligate any Lender to obtain the funds for any Loan or Advance in any
particular place or manner or to constitute a representation by any Lender that
it has obtained or will obtain the funds for any Loan or Advance in any
particular place or manner.
3.13 Failure to Charge Not Subsequent Waiver. Any decision by the
Administrative Agent or any Lender not to require payment of any interest
(including interest at the Default Rate), fee, cost or other amount payable
under any Loan Document, or to calculate any amount payable by a particular
method, on any occasion shall in no way limit or be deemed a waiver of the
Administrative Agent's or such Lender's right to require full payment of any
interest (including interest at the Default Rate), fee, cost or other amount
payable under any Loan Document, or to calculate an amount payable by another
method that is not inconsistent with this Agreement, on any other or subsequent
occasion.
3.14 Administrative Agent's Right to Assume Payments Will be Made
by the Borrower. Unless the Administrative Agent shall have been notified by the
Borrower prior to the date on which any payment to be made by the Borrower
hereunder is due that the Borrower do not intend to remit such payment, the
Administrative Agent may, in its discretion, assume that the Borrower has
remitted such payment when so due and the Administrative Agent may, in its
discretion and in reliance upon such assumption, make available to each Lender
on such payment date an amount equal to such Lender's share of such assumed
payment. If the Borrower has not in fact remitted such payment to the
Administrative Agent, each Lender shall forthwith on demand repay to the
Administrative Agent the amount of such assumed payment made available to such
Lender, together with interest thereon in respect of each day from and including
the date such amount was made available by the Administrative Agent to such
Lender to the date such amount is repaid to the Administrative Agent at the
Federal Funds Rate.
3.15 Fee Determination Detail. The Administrative Agent and any
Lender shall provide reasonable detail to the Borrower regarding the manner in
which the amount of any payment to the Creditors, or that Lender, under Article
3 has been determined, concurrently with demand for such payment.
3.16 Survivability. All of the Borrower's obligations under
Sections 3.7 and 3.8 shall survive for ninety days following the date on which
the last occurs: (a) the Commitments are terminated, (b) all Obligations are
fully paid, and (c) all Letters of Credit have expired or have been cash
collateralized in a manner which is acceptable to the Administrative Agent and
the Issuing Lender.
48
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
4.1 Existence and Qualification; Power; Compliance With Laws. The
Borrower is a corporation duly incorporated, validly existing and in good
standing under the Laws of Nevada. Each of the Subsidiaries of the Borrower is
duly formed, validly existing and in good standing under the Laws of its state
or jurisdiction of formation. The Borrower and each of its Subsidiaries are duly
qualified or registered to transact business and are in good standing in each
other jurisdiction in which the conduct of their business or the ownership or
leasing of their Properties makes such qualification or registration necessary,
except where the failure so to qualify or register and to be in good standing
would not constitute a Material Adverse Effect. The Borrower and each of its
Subsidiaries have all requisite corporate or other organizational power and
authority to conduct their business, to own and lease their Properties and to
execute and deliver each Loan Document to which each is a Party and to perform
the Obligations. All outstanding shares of the capital stock of the Borrower are
duly authorized, validly issued, fully paid and non-assessable, and no holder
thereof has any enforceable right of rescission under any applicable state or
federal securities Laws. The Borrower is in compliance with all Requirements of
Law applicable to its business as at present conducted, has obtained all
authorizations, consents, approvals, orders, licenses and permits from, and has
accomplished all filings, registrations and qualifications with, or obtained
exemptions from any of the foregoing from, any Governmental Agency that are
necessary for the transaction of its business as at present conducted, except
where the failure so to comply, file, register, qualify or obtain exemptions
does not constitute a Material Adverse Effect.
4.2 Authority; Compliance With Other Agreements and Instruments
and Government Regulations. The execution, delivery and performance by the
Borrower and each Significant Subsidiary of the Loan Documents to which it is a
Party have been duly authorized by all necessary corporate or other
organizational action, and do not and will not:
(a) Require any consent or approval not heretofore
obtained of any member, partner, director, stockholder, security holder
or creditor of such Party;
(b) Violate or conflict with any provision of such
Party's charter, articles of incorporation, operating agreement or
bylaws, as applicable;
(c) Result in or require the creation or imposition of
any Lien or Right of Others upon or with respect to any Property now
owned or leased or hereafter acquired by such Party;
(d) Violate any Requirement of Law applicable to such
Party, subject to obtaining the authorizations from, or filings with,
the Governmental Agencies described in Schedule 4.3;
(e) Result in a breach of or constitute a default under,
or cause or permit the acceleration of any obligation owed under, any
indenture or loan or credit agreement or
49
any other Contractual Obligation to which such Party is a party or by
which such Party or any of its Property is bound or affected;
and neither the Borrower nor any Significant Subsidiary is in violation of, or
default under, any Requirement of Law or Contractual Obligation, or any
indenture, loan or credit agreement described in Section 4.2(e), in any respect
that constitutes a Material Adverse Effect.
4.3 No Governmental Approvals Required - Consents to Pledge.
Except as set forth in Schedule 4.3 or previously obtained or made, no
authorization, consent, approval, order, license or permit from, or filing,
registration or qualification with, any Governmental Agency is or will be
required to authorize or permit under applicable Laws the execution, delivery
and performance by the Borrower and its Subsidiaries of the Loan Documents to
which it is a Party. Except as set forth in Schedule 4.3, all authorizations
from, or filings with, any Governmental Agency described in Schedule 4.3 will be
accomplished as of the Closing Date. As to the items set forth on Schedule 5.12,
the Borrower represents and warrants that its has filed all applications and
petitions necessary to obtain the authorizations, consents and approvals
described therein (except to the extent that the same require the filing of this
Agreement, in which case the same shall be accomplished within 10 days following
the execution hereof).
4.4 Subsidiaries.
(a) Schedule 4.4 hereto correctly sets forth the names,
form of legal entity, number of shares of capital stock issued and
outstanding, number of shares owned by the Borrower or a Subsidiary of
the Borrower (specifying such owner) and jurisdictions of organization
of all Subsidiaries of the Borrower. Except as described in Schedule
4.4 (and Investments and Acquisitions made after the date hereof and
permitted hereby), the Borrower does not own any capital stock, equity
interest or debt security which is convertible, or exchangeable, for
capital stock or equity interests in any Person. Unless otherwise
indicated in Schedule 4.4, all of the outstanding shares of capital
stock, or all of the units of equity interest, as the case may be, of
each Subsidiary are owned of record and beneficially by the Borrower,
there are no outstanding options, warrants or other rights to purchase
capital stock of any such Subsidiary, and all such shares or equity
interests so owned are duly authorized, validly issued, fully paid and
non-assessable, and were issued in compliance with all applicable state
and federal securities and other Laws, and are free and clear of all
Liens and Rights of Others, except for Permitted Encumbrances and
Permitted Rights of Others.
(b) Each Subsidiary of the Borrower is in compliance with
all Requirements of Law applicable to its business and has obtained all
authorizations, consents, approvals, orders, licenses, and permits
from, and each such Subsidiary has accomplished all filings,
registrations, and qualifications with, or obtained exemptions from any
of the foregoing from, any Governmental Agency that are necessary for
the transaction of its business, except where the failure to be in such
compliance, obtain such authorizations, consents, approvals, orders,
licenses, and permits, accomplish such filings, registrations, and
qualifications, or obtain such exemptions, does not constitute a
Material Adverse Effect.
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4.5 Financial Statements. The Borrower has furnished to the
Lenders (a) the audited consolidated and consolidating financial statements of
the Borrower and its Subsidiaries for the Fiscal Year ended June 30, 2002 and
(b) the unaudited consolidated and consolidating financial statements of each of
the Borrower and its Subsidiaries for the Fiscal Quarter ended March 31, 2003.
The financial statements described above fairly present in all material respects
the financial condition, results of operations and changes in financial position
of the Borrower and its Subsidiaries as of such dates and for such periods in
conformity with Generally Accepted Accounting Principles, consistently applied.
4.6 No Other Liabilities; No Material Adverse Changes. As of the
Closing Date, the Borrower and its Subsidiaries do not have any material
liability or material contingent liability required under Generally Accepted
Accounting Principles to be reflected or disclosed and not reflected or
disclosed in the financial statements described in Section 4.5(b), other than
liabilities and contingent liabilities arising in the ordinary course of
business since the date of such financial statements. As of the Closing Date, no
circumstance or event has occurred that constitutes a Material Adverse Effect as
to the Borrower and its Subsidiaries since June 30, 2002. As of any date
subsequent to the Closing Date, no circumstance or event has occurred that
constitutes a Material Adverse Effect since the Closing Date.
4.7 Title to Property. The Borrower and its Subsidiaries have
rights in the Property reflected in the financial statements described in
Section 4.5(b), other than immaterial items of Property and Property
subsequently sold or disposed of in the ordinary course of business, free and
clear of all Liens and Rights of Others, other than Permitted Encumbrances,
Permitted Rights of Others and Liens or Rights of Others described in Schedule
4.7 or permitted by Section 6.8.
4.8 Real Property. Schedule 4.8 sets forth as of the Closing Date
a summary description of all real property owned and real property leasehold
estates held by the Borrower and its Subsidiaries, which summary is accurate and
complete in all material respects except for real property acquired or leased
after the Closing Date after notice to the Administrative Agent.
4.9 Intangible Assets. The Borrower and its Subsidiaries own, or
possess the right to use to the extent necessary in their businesses, all
material trademarks, trade names, copyrights, patents, patent rights, computer
software, licenses and other Intangible Assets that are used in the conduct of
their businesses, and no such Intangible Asset, to the actual best knowledge of
the Borrower, conflicts with the valid trademark, trade name, copyright, mask
work, patent, patent right or Intangible Asset of any other Person to the extent
that such conflict constitutes a Material Adverse Effect. Schedule 4.9 sets
forth, as of the Closing Date, all material patents, trademarks, trade names,
trade styles, copyrights and mask works owned by the Borrower and its
Subsidiaries.
4.10 Public Utility Holding Company Act. Neither the Borrower nor
any of its Subsidiaries is a "holding company", or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
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4.11 Litigation. Except for (a) any matter fully covered as to
subject matter and amount (subject to applicable deductibles and retentions) by
insurance as to which the insurance carrier has been notified and has not
asserted lack of subject matter coverage or reserved its right to do so, (b) any
matter, or series of related matters, involving a claim against the Borrower or
any of its Subsidiaries of less than $5,000,000, (c) matters of an
administrative nature not involving a claim or charge against the Borrower or
any of its Subsidiaries and (d) matters set forth in Schedule 4.11, there are no
actions, suits, proceedings or investigations pending as to which the Borrower
or any of its Subsidiaries have been served or have received notice or, to the
best knowledge of the Borrower, threatened against or affecting the Borrower or
any of its Subsidiaries or any Property of any of them before any Governmental
Agency which may reasonably be expected to have a Material Adverse Effect.
4.12 Binding Obligations. Each of the Loan Documents to which the
Borrower or any of its Subsidiaries is a Party will, when executed and delivered
by such Party, constitute the legal, valid and binding obligation of such Party,
enforceable against such Party in accordance with its terms, except as
enforcement may be limited by Debtor Relief Laws, Gaming Laws or equitable
principles relating to the granting of specific performance and other equitable
remedies as a matter of judicial discretion.
4.13 No Default. No event has occurred and is continuing that is a
Default or Event of Default.
2.14 ERISA.
(a) With respect to each Pension Plan:
(i) such Pension Plan complies in all material
respects with ERISA and any other applicable Laws to the extent that
noncompliance could reasonably be expected to have a Material Adverse
Effect;
(ii) such Pension Plan has not incurred any
"accumulated funding deficiency" (as defined in Section 302 of ERISA)
that could reasonably be expected to have a Material Adverse Effect;
(iii) no "reportable event" (as defined in Section
4043 of ERISA) has occurred that could reasonably be expected to have a
Material Adverse Effect; and
(iv) neither the Borrower nor any of its
Subsidiaries has engaged in any non-exempt "prohibited transaction" (as
defined in Section 4975 of the Code) that could reasonably be expected
to have a Material Adverse Effect.
(b) Neither the Borrower nor any of its Subsidiaries has
incurred or expects to incur any withdrawal liability to any
Multiemployer Plan that could reasonably be expected to have a Material
Adverse Effect.
4.15 Regulations T, U and X; Investment Company Act. No part of the
proceeds of any Loan hereunder will be used to purchase or carry, or to extend
credit to others for the purpose of purchasing or carrying, any Margin Stock in
violation of Regulations T, U and X.
52
Neither the Borrower nor any of its Subsidiaries is or is required to be
registered as an "investment company" under the Investment Company Act of 1940.
4.16 Disclosure. Taken as a whole, the written statements made by
Senior Officers of the Borrower and its Subsidiaries to the Administrative Agent
and to the Lenders in connection with this Agreement, and in connection with the
Loans, do not contain as of the date thereof, any untrue statement of a material
fact or omitted a material fact necessary to make the statement made not
misleading in light of all the circumstances existing at the date the statement
was made.
4.17 Tax Liability. The Borrower and its Subsidiaries have filed
all tax returns which are required to be filed, and have paid, or made provision
for the payment of, all taxes with respect to the periods, Property or
transactions covered by said returns, or pursuant to any assessment received by
the Borrower or its Subsidiaries, except (a) such taxes, if any, as are being
contested in good faith by appropriate proceedings and as to which adequate
reserves have been established and maintained and (b) immaterial taxes so long
as no material Property of the Borrower or any of its Subsidiaries is in
jeopardy of being seized, levied upon or forfeited.
4.18 Projections. As of the Closing Date, the assumptions set forth
in the Projections are reasonable and consistent with each other and with all
facts known to the Borrower and its Subsidiaries, and the Projections are
reasonably based on such assumptions. Nothing in this Section shall be construed
as a representation or covenant that the Projections in fact will be achieved.
The Creditors acknowledge that the Projections are forward-looking statements
and that actual financial results for the Borrower and its Subsidiaries could
differ materially from those set forth in the Projections.
4.19 Hazardous Materials. Except as described in Schedule 4.19, (a)
neither the Borrower nor any of its Subsidiaries at any time has disposed of,
discharged, released or threatened the release of any Hazardous Materials on,
from or under the Real Property in violation of any Hazardous Materials Law that
would individually or in the aggregate constitute a Material Adverse Effect, (b)
to the actual best knowledge of the Borrower, no condition exists that violates
any Hazardous Material Law affecting any Real Property except for such
violations that would not individually or in the aggregate have a Material
Adverse Effect, (c) no Real Property or any portion thereof is or has been
utilized by the Borrower or any of its Subsidiaries as a site for the
manufacture of any Hazardous Materials and (d) to the extent that any Hazardous
Materials are used, generated or stored by the Borrower or any of its
Subsidiaries on any Real Property, or transported to or from such Real Property
by the Borrower or any of its Subsidiaries, such use, generation, storage and
transportation are in compliance in all material respects with all Hazardous
Materials Laws.
4.20 Tax Shelter Regulations. The Borrower does not intend to treat
the Loans as being a "reportable transaction" (within the meaning of Treasury
Regulation Section 1.6011-4). In the event the Borrower determines to take any
action inconsistent with such intention, it will promptly notify the
Administrative Agent thereof. If the Borrower notifies the Administrative Agent,
the Borrower acknowledges that one or more of the Lenders may treat its Loans as
part of a transaction that is subject to Treasury Regulation Section 301.6112-1,
and such Lender or Lenders, as applicable, will maintain the lists and other
records required by such Treasury Regulation.
53
ARTICLE 5
AFFIRMATIVE COVENANTS
(OTHER THAN INFORMATION AND REPORTING REQUIREMENTS)
So long as any Advance remains unpaid, or any Letter of Credit remains
outstanding or any other Obligation remains unpaid, or any portion of the
Commitments remains in force, Borrower shall, and shall cause each of its
Subsidiaries to, unless the Administrative Agent (with the written approval of
the Requisite Lenders (or, if required by Section 11.2, another group of the
Lenders)) otherwise consents:
5.1 Payment of Taxes and Other Potential Liens. Pay and discharge
promptly all taxes, assessments and governmental charges or levies imposed upon
any of them, upon their respective Property or any part thereof and upon their
respective income or profits or any part thereof, except that the Borrower and
its Subsidiaries shall not be required to pay or cause to be paid (a) any tax,
assessment, charge or levy that is not yet past due, or is being contested in
good faith by appropriate proceedings so long as the relevant entity has
established and maintains adequate reserves for the payment of the same or (b)
any immaterial tax so long as no material Property of the Borrower or any of its
Subsidiaries is in jeopardy of being seized, levied upon or forfeited.
5.2 Preservation of Existence. Except for transactions permitted
by Sections 6.2 and 6.3, preserve and maintain their respective existences in
the jurisdiction of their formation and all material authorizations, rights,
franchises, privileges, consents, approvals, orders, licenses, permits, or
registrations from any Governmental Agency that are necessary for the
transaction of their respective business except where the failure to so preserve
and maintain the existence of any Subsidiary of the Borrower and such
authorizations, rights, franchises, privileges, consents, approvals, orders,
licenses, permits, or registrations would not constitute a Material Adverse
Effect; and qualify and remain qualified to transact business in each
jurisdiction in which such qualification is necessary in view of their
respective business or the ownership or leasing of their respective Properties
except where the failure to so qualify or remain qualified would not constitute
a Material Adverse Effect.
5.3 Maintenance of Properties. Maintain, preserve and protect all
of their respective Properties in good order and condition, subject to wear and
tear in the ordinary course of business, and not permit any waste of their
respective Properties, except that neither (a) the failure to maintain, preserve
and protect a particular item of Property that is not of significant value,
either intrinsically or to the operations of the Borrower and its Subsidiaries,
taken as a whole, nor (b) any Disposition permitted by Section 6.2, shall
constitute a violation of this covenant.
5.4 Maintenance of Insurance. Maintain liability, casualty and
other insurance (subject to customary deductibles and retentions) with
responsible insurance companies in such amounts and against such risks as is
carried by responsible companies engaged in similar businesses and owning
similar assets in the general areas in which the Borrower and its Subsidiaries
operate, and in any event coverages which are not materially less than those
maintained as of the Closing Date.
54
5.5 Compliance With Laws. Comply, within the time period, if any,
given for such compliance by the relevant Governmental Agency with enforcement
authority, with all Requirements of Law noncompliance with which constitutes a
Material Adverse Effect, except that the Borrower and its Subsidiaries need not
comply with a Requirement of Law then being contested by any of them in good
faith by appropriate proceedings.
5.6 Inspection Rights. Upon reasonable notice, at any time during
regular business hours and as often as reasonably requested (but not so as to
materially interfere with the business of the Borrower or any of its
Subsidiaries) permit the Administrative Agent or any Lender, or any authorized
employee, agent or representative thereof, to examine, audit and make copies and
abstracts from the records and books of account of, and to visit and inspect the
Properties of, the Borrower and its Subsidiaries and to discuss the affairs,
finances and accounts of the Borrower and its Subsidiaries with any of their
officers, managers, key employees or accountants and, upon request, furnish
promptly to the Administrative Agent or any Lender true copies of all financial
information made available to the board of directors or audit committee of the
board of directors of the Borrower.
5.7 Keeping of Records and Books of Account. Keep adequate records
and books of account reflecting all financial transactions in conformity with
Generally Accepted Accounting Principles, consistently applied, and in material
conformity with all applicable requirements of any Governmental Agency having
regulatory jurisdiction over the Borrower or any of its Subsidiaries.
5.8 Compliance With Agreements. Promptly and fully comply with all
Contractual Obligations under all material agreements, indentures, leases and/or
instruments to which any one or more of them is a party, whether such material
agreements, indentures, leases or instruments are with a Lender or another
Person, except for any such Contractual Obligations (a) the performance of which
would cause a Default or (b) then being contested by any of them in good faith
by appropriate proceedings or if the failure to comply with such agreements,
indentures, leases or instruments does not constitute a Material Adverse Effect.
5.9 Use of Proceeds. Use the proceeds of Loans (a) on the Closing
Date, to repay the obligations under and terminate the Existing Credit
Agreement, and (b) to consummate the Existing Senior Subordinated Notes Tender
Offer and to repurchase any Existing Senior Subordinated Notes that remain
outstanding and (c) for capital expenditures, to provide working capital and for
other general corporate purposes of the Borrower and its Subsidiaries including
the Acquisitions and Investments permitted or described herein.
5.10 New Significant Subsidiaries. Cause each Person, other than
any Excluded Subsidiary, that hereafter becomes a Domestic Significant
Subsidiary of the Borrower to execute and deliver, concurrently with its
formation, acquisition or otherwise becoming a Domestic Significant Subsidiary,
joinders to the Facilities Guaranty and the Subsidiaries Security Agreement,
together with such other instruments, documents and agreements, including
financing statements, as the Administrative Agent may require to grant and
perfect Liens in substantially all of its Property to secure its obligations
under such guarantees. In addition thereto, the Borrower shall cause 100% of the
capital stock of each such Person which is a Domestic Significant Subsidiary to
be pledged to the Administrative Agent pursuant to the
55
Facilities Pledge Agreement, together with any other Collateral Documents
requested by the Administrative Agent.
5.11 Hazardous Materials Laws. Keep and maintain all Real Property
and each portion thereof in compliance in all material respects with all
applicable Hazardous Materials Laws and promptly notify the Administrative Agent
in writing (attaching a copy of any pertinent written material) of (a) any and
all material enforcement, cleanup, removal or other governmental or regulatory
actions instituted, completed or threatened in writing by a Governmental Agency
pursuant to any applicable Hazardous Materials Laws, (b) any and all material
claims made or threatened in writing by any Person against the Borrower or its
Subsidiaries relating to damage, contribution, cost recovery, compensation, loss
or injury resulting from any Hazardous Materials and (c) discovery by any Senior
Officer of the Borrower of any material occurrence or condition on Property
adjoining or in the vicinity of such Real Property that could reasonably be
expected to cause such Real Property or any part thereof to be subject to any
restrictions on the ownership, occupancy, transferability or use of such Real
Property under any applicable Hazardous Materials Laws.
5.12 Approvals of Pledge of Significant Subsidiary Shares.
Diligently pursue by appropriate proceedings and in all events shall obtain on
or before January 31, 2004 all Gaming Board and other Governmental Agency
approvals required for the Borrower and its Subsidiaries to perform under this
Agreement, including but not limited to approvals required for the Borrower and
its Subsidiaries to pledge their shares of gaming licensees described in
Schedule 5.12 to the Administrative Agent to secure the Obligations pursuant to
the Facilities Pledge Agreement.
ARTICLE 6
NEGATIVE COVENANTS
So long as any Advance remains unpaid, or any Letter of Credit remains
outstanding or any other Obligation remains unpaid, or any portion of the
Commitments remain in force, the Borrower shall not, and shall not permit any of
its Subsidiaries to, unless the Administrative Agent (with the written approval
of the Requisite Lenders or, if required by Section 11.2, of any other group of
the Lenders) otherwise consents:
6.1 Payment of Subordinated Obligations. Prepay any principal
(including sinking fund payments) or any other amount with respect to any
Subordinated Obligation, or purchase or redeem (or offer to purchase or redeem)
any Subordinated Obligation prior to the scheduled maturity date thereof, or
deposit any monies, securities or other Property with any trustee or other
Person to provide assurance that the principal or any portion thereof of any
Subordinated Obligation will be paid when due or otherwise to provide for the
defeasance of any Subordinated Obligation provided that so long as no Default or
Event of Default then exists or would result therefrom, the Borrower may make
payments of scheduled interest on any Subordinated Obligations in accordance
with the terms thereof and the Borrower may consummate the Existing Senior
Subordinated Notes Tender Offer and repurchase any Existing Senior Subordinated
Notes that remain outstanding after giving effect to the Existing Senior
Subordinated Notes Tender Offer.
56
6.2 Disposition of Property. Make any Disposition of its Property,
whether now owned or hereafter acquired, other than Dispositions of the types
described below made when no Default or Event of Default exists or would result
therefrom:
(a) Dispositions of obsolete or worn-out Property, tools
or equipment no longer used or useful in its business or Real Property
no longer used or useful in its business;
(b) Dispositions of the Borrower's and its Subsidiaries'
customer loans or receivables (at a discount of not more than 8%) for
risk management purposes; provided that the consideration for all sales
pursuant to this clause (b) shall be in cash and shall not exceed
$15,000,000 per customer or $40,000,000, in the aggregate, in any
Fiscal Year of the Borrower;
(c) Dispositions consisting of any sale or sale and
leaseback of the Headquarters Property, provided that (i) a portion of
the proceeds of such sale is applied to prepay the Loans as set forth
in Section 2.7 and (ii) the related sale transaction is on a
non-recourse basis to the Borrower and its Subsidiaries (other than as
to conventional representations, warranties and indemnities regarding
the condition thereof) and the residual liability of the Borrower and
its Subsidiaries is limited to rental obligations with respect to the
Headquarters Property;
(d) so long as no Event of Default has occurred and is
continuing or would result therefrom, the Borrower and its Subsidiaries
may sell equipment and other assets, to the extent not otherwise
permitted under any other clause of this Section 6.2, at the fair
market value thereof (as determined in good faith by management of the
Borrower), provided that the aggregate consideration (valued as
described above) for all sales pursuant to this clause (d) shall not
exceed $5,000,000 in any Fiscal Year of the Borrower;
(e) the Borrower and its Subsidiaries may, in the
ordinary course of business, license, as licensor or licensee, patents,
trademarks, copyrights, mask works and know-how to third Persons and to
one another;
(f) liquidations and dissolutions of Subsidiaries
permitted by Section 5.2; and
(g) Disposition of any other Property of Borrower or its
Subsidiaries, provided that the proceeds of such sale is applied to
prepay the Loans as set forth in Section 2.7 and Section 3.1(d).
6.3 Mergers. Merge or consolidate with or into any Person, except
(a) mergers and consolidations of a Wholly-Owned Subsidiary of the Borrower into
the Borrower or another Wholly-Owned Subsidiary of the Borrower, and (b) mergers
with any Person in connection with Acquisitions permitted under Section 6.12 so
long as the Borrower and its Subsidiaries execute such amendments to the Loan
Documents as may be reasonably requested by the Administrative Agent to reflect
such change.
57
6.4 Hostile Acquisitions. Directly or indirectly use the proceeds
of any Loan in connection with the acquisition of part or all of a voting
interest of five percent or more in any corporation or other business entity if
such acquisition is opposed by the board of directors or management of such
corporation or business entity.
6.5 Distributions. Make any Distribution, whether from capital,
income or otherwise, and whether in Cash or other Property, except:
(a) Distributions by a Subsidiary of the Borrower to the
Borrower or to a Wholly-Owned Significant Subsidiary and by the
Excluded Subsidiaries to their other stakeholders in the ordinary
course of business and consistent with past practices;
(b) so long as no Default or Event of Default has
occurred and is continuing or would result therefrom, Distributions by
the Borrower, provided that the aggregate amount of Distributions made
by the Borrower pursuant to this clause (b) shall not exceed (i)
$125,000,000 during the period from the Closing Date to and including
the one year anniversary of the Closing Date and (ii) at any time after
the one year anniversary of the Closing Date, $125,000,000 plus 50% of
cumulative Net Income for all fiscal periods commencing after June 30,
2003 (before extraordinary items) minus the amount of Investments made
pursuant to the last Paragraph of Section 6.12; and
(c) so long as no Default or Event of Default has
occurred and is continuing or would result therefrom and the Total
Leverage Ratio is less than 3.00:1.00, on a pro forma basis, payment of
dividend or distribution by the Borrower in Cash on or with respect to
any security of the Borrower not to exceed $0.25 per common share in
any Fiscal Quarter of the Borrower.
6.6 ERISA. At any time, permit any Pension Plan to (i) engage in
any non-exempt "prohibited transaction" (as defined in Section 4975 of the
Code), (ii) fail to comply with ERISA or any other applicable Laws, (iii) incur
any material "accumulated funding deficiency" (as defined in Section 302 of
ERISA), or (iv) terminate in any manner, which, with respect to each event
listed above, could reasonably be expected to result in a Material Adverse
Effect, or (v) withdraw, completely or partially, from any Multiemployer Plan if
to do so could reasonably be expected to result in a Material Adverse Effect.
6.7 Change in Nature of Business. Make any material change in the
accounting methods of the Borrower (except to the extent such change is required
by GAAP) or the nature of the business of the Borrower and its Subsidiaries,
taken as a whole.
6.8 Liens and Negative Pledges. Create, incur, assume or suffer to
exist any Lien or Negative Pledge of any nature upon or with respect to any of
its Properties, or engage in any sale and leaseback transaction with respect to
any of its Properties, whether now owned or hereafter acquired, except:
(a) Permitted Encumbrances;
(b) Liens and Negative Pledges under the Loan Documents;
58
(c) Liens and Negative Pledges existing on the Closing
Date and disclosed in Schedule 4.7 and any renewals/extensions or
amendments thereof, provided that the obligations secured or benefitted
thereby are not increased;
(d) Liens and related Negative Pledges on Property
acquired by the Borrower or any of its Subsidiaries following the
Closing Date securing Indebtedness permitted under Section 6.9(e) and
which and are not created in contemplation of the acquisitions
described in that Section;
(e) Liens securing Indebtedness permitted by Section
6.9(d) on and limited to the capital assets acquired, constructed or
financed with the proceeds of such Indebtedness or with the proceeds of
any Indebtedness directly or indirectly refinanced by such
Indebtedness, and related Negative Pledges with respect to such assets,
provided that the scope of such Liens and Negative Pledges are not
increased and the obligations secured or benefitted thereby are not
increased;
(f) any Negative Pledge created by an agreement or
instrument entered into by the Borrower or any of its Subsidiaries in
the ordinary course of its business which consists of a restriction on
the assignability, transfer or hypothecation of such agreement or
instrument;
(g) Liens created by operation of applicable Gaming Laws
or imposed by contract with the relevant Gaming Board;
(h) Liens securing the Indebtedness and contingent
obligations described in Section 6.9(h) that are equal, ratable and
pari passu with the Liens securing the Obligations, it being understood
that the Administrative Agent may enter into intercreditor agreements
with the creditors holding such Indebtedness and contingent
obligations;
(i) judgment Liens securing judgments which do not result
in an Event of Default;
(j) Liens on Cash Equivalents or Investments securing
liabilities for jackpots payable for progressive games in a manner
consistent with industry practice and applicable Gaming Laws;
(k) Liens securing Indebtedness incurred in connection
with a mortgage financing of the Headquarters Property so long as such
Liens extend solely to the real property that composes the Headquarters
Property and related Negative Pledges with respect thereto;
(l) licenses, leases, sublicenses or subleases granted to
other Persons in the ordinary course of business and not materially
interfering with the conduct of the business of the Borrower and its
Subsidiaries, taken as a whole;
(m) Liens associated with the sale of customer loans and
receivables permitted by Section 6.2(b); and
59
(n) any extension, renewal or replacement of the
foregoing provided that the scope of the Property so encumbered and the
related obligations are not increased.
6.9 Indebtedness and Contingent Obligations. Create, incur or
assume any Indebtedness or Contingent Obligation except:
(a) Indebtedness and Contingent Obligations existing on
the Closing Date and disclosed in Schedule 6.9, and refinancings,
renewals, extensions or amendments thereto by the same obligors that do
not increase the amount thereof;
(b) Indebtedness and Contingent Obligations under the
Loan Documents;
(c) Indebtedness and Contingent Obligations owed to the
Borrower or a Wholly-Owned Subsidiary of the Borrower;
(d) Indebtedness consisting of Capital Lease Obligations,
or otherwise incurred to finance the purchase or construction of
capital assets (which shall be deemed to be so incurred if the
Indebtedness is incurred at or within 90 days before or after the
purchase or commencement of construction of the capital asset), or to
refinance any such Indebtedness, provided that the aggregate principal
amount of such Indebtedness outstanding does not exceed (i) $10,000,000
on the Closing Date and (ii) at any time thereafter $20,000,000;
(e) Indebtedness owing by Persons, or secured by
Property, acquired by the Borrower or any of its Subsidiaries following
the Closing Date that is in existence at the time of such acquisition
and is not created in contemplation of such acquisition, provided that
the aggregate outstanding principal amount of any such Indebtedness
shall not exceed $20,000,000 at any time;
(f) Indebtedness consisting of one or more Swap
Agreements entered into in the ordinary course of business with respect
to outstanding Indebtedness or existing currency exchange risk;
provided, that the aggregate notional amount of Indebtedness covered by
all Swap Agreements shall not exceed the aggregate amount of the
Commitments;
(g) The Existing Senior Subordinated Notes and other
Subordinated Obligations incurred when no Default or Event of Default
exists, together with Contingent Obligations with respect thereto
incurred by Subsidiaries which have also entered into the Facilities
Guaranty;
(h) Indebtedness in an aggregate principal amount not to
exceed $50,000,000 and related contingent obligations consisting of
guarantees by those Subsidiaries of the Borrower which have also
guaranteed the Obligations; provided, that the Revolving Commitment has
been terminated and the Obligations thereunder paid in full;
(i) Contingent Obligations in support of the obligations
of the Borrower or a Wholly-Owned Subsidiary of the Borrower;
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(j) certificates of deposit, bonds and other surety
obligations required to be maintained in accordance with applicable
Gaming Laws or in accordance with industry practice;
(k) Indebtedness and contingent obligations with respect
to performance bonds, surety bonds, appeal bonds or customs bonds
required in the ordinary course of business or in connection with the
enforcement of right or claims of the Borrower or any of its
Subsidiaries, provided that the aggregate outstanding principal amount
of any such Indebtedness and contingent obligations shall not exceed
$20,000,000 at any time;
(l) Indebtedness constituting intercompany loans and
advances to the extent permitted by Section 6.12;
(m) Indebtedness incurred in connection with a mortgage
financing of the Headquarters Property;
(n) Indebtedness and Contingent Obligations with respect
to issuance of unsecured or subordinated debt on terms reasonably
acceptable to the Joint Lead Arrangers, provided that the aggregate
outstanding principal amount of any such Indebtedness and Contingent
Obligations shall not exceed $150,000,000 at any time;
(o) other Indebtedness of a type not described in clauses
(a) through (n) above in an aggregate principal amount not to exceed
(i) $10,000,000 on the Closing Date and (ii) at any time thereafter
$20,000,000.
6.10 Transactions with Affiliates. Except as set forth on Schedule
6.10, enter into any transaction of any kind with any Affiliate of the Borrower
other than (a) salary, bonus, employee stock option and other compensation
arrangements with directors, officers or managers in the ordinary course of
business, (b) transactions that are fully disclosed to the board of directors of
the Borrower and expressly authorized by a resolution of the board of directors
of the Borrower which is approved by a majority of the directors not having an
interest in the transaction, (c) transactions between or among the Borrower and
its Subsidiaries, and (d) transactions on overall terms at least as favorable to
the Borrower or its Subsidiaries as would be the case in an arm's-length
transaction between unrelated parties of equal bargaining power.
6.11 Capital Expenditures. Make, or become legally obligated to
make, any Capital Expenditure except:
(a) Maintenance Capital Expenditures (other than with
respect to United Coin Machine Co.) in an aggregate amount not to
exceed $25,000,000 in any Fiscal Year;
(b) Maintenance Capital Expenditures solely with respect
to United Coin Machine Co. in an aggregate amount not to exceed
$15,000,000 in any Fiscal Year; and
(c) other Capital Expenditures in an aggregate amount not
to exceed $25,000,000 in any Fiscal Year.
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6.12 Investments and Acquisitions. Make any Acquisition or enter
into any agreement to make any Acquisition, or suffer to exist any Investment,
other than:
(a) Investments in existence on the Closing Date and
disclosed on Schedule 6.12;
(b) Investments consisting of Cash Equivalents;
(c) Investments consisting of advances to officers,
managers, directors and employees of the Borrower and the Subsidiaries
for travel, entertainment, relocation and analogous ordinary business
purposes;
(d) Investments (i) in the Borrower or in Wholly-Owned
Subsidiaries of the Borrower, (ii) to purchase equity interests in
Rainbow Casino Vickburg Partnership, L.P., or (iii) in any other
Excluded Subsidiaries if the effect thereof would be to make such
Excluded Subsidiaries Wholly-Owned Subsidiaries;
(e) Investments consisting of or evidencing the extension
of credit to customers or suppliers of the Borrower and its
Subsidiaries in the ordinary course of business and any Investments
received in satisfaction or partial satisfaction thereof;
(f) Investments received in connection with the
settlement of a bona fide dispute with another Person;
(g) Investments representing all or a portion of the
sales price of Property sold or services provided to another Person in
the ordinary course of business;
(h) Investments consisting of Contingent Obligations
permitted by Section 6.9;
(i) Investments in Swap Agreements with respect to the
Obligations and other floating rate Indebtedness of the Borrower and
its Subsidiaries;
(j) Acquisitions made when no Default or Event of Default
exists of Persons engaged primarily in the same or similar lines of
business as the Borrower and its existing Subsidiaries (and existing
Investments of such Persons whether or not primarily related to such
business) or of assets used in such businesses, provided that (i) the
consideration paid (net of Cash and Cash Equivalents acquired) by the
Borrower and its Subsidiaries for such Acquisitions consists (A) solely
of the capital stock of the Borrower and (B) Cash and other Property
having an aggregate value not in excess of $100,000,000 during the term
of this Agreement; and (ii) giving pro forma effect to the making of
such Acquisition as of the last day of the then most recently ended
Fiscal Quarter, the Borrower is in pro forma compliance with Sections
6.13 through 6.15;
(k) so long as no Event of Default has occurred and is
continuing or would result therefrom, Investments by the Borrower in
one or more joint ventures for the development of gaming equipment in
an aggregate amount not to exceed $25,000,000;
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(l) Investments by the Borrower or its Wholly-Owned
Subsidiaries to establish new Wholly-Owned Subsidiaries which are
Significant Subsidiaries, executes the documents required by Section
5.10;
(m) Investments consisting of non-ordinary course
advances to officers, managers, directors, and employees of the
Borrower and the Subsidiaries in an aggregate amount outstanding at any
one time not to exceed $1,000,000;
(n) Investments received in connection with a Disposition
permitted pursuant to Sections 3.1(d)(vii) and (viii);
(o) Investments consisting of loans to customers so long
as the aggregate principal amount of such loans does not exceed
$40,000,000 at any time or $15,000,000 per property of any such
customer; and
(p) other Investments of a type not described in clauses
(a) through (m) above in an aggregate amount not to exceed $60,000,000.
Notwithstanding the foregoing provisions of this Section 6.12, the Borrower and
its United States domestic Subsidiaries shall not make any new Investment in any
Subsidiary organized under the Laws of any jurisdiction which is outside of the
United States if, after giving effect to such Investment, the amount of all such
Investments plus the aggregate amount of Distributions made pursuant to Section
6.5(b) exceeds (i) $125,000,000 during the period from the Closing Date to and
including the one year anniversary of the Closing Date or (ii) at any time after
the one year anniversary of the Closing Date, $125,000,000 plus 50% of
cumulative Net Income for all fiscal periods commencing after June 30, 2003
(before extraordinary items).
6.13 Total Leverage Ratio. Permit the Total Leverage Ratio as of
the last day of any Fiscal Quarter ending during a period set forth in the
matrix below, to be greater than the ratio set forth opposite that period:
Fiscal Quarters Ended Maximum Total Leverage Ratio
--------------------- ----------------------------
Closing Date through December 31, 2004 3.50:1.00
March 31, 2005 and thereafter 3.25:1.00.
6.14 Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage
Ratio, as of the last day of any Fiscal Quarter, to be less than 2.00:1.00.
6.15 Minimum EBITDA. Permit EBITDA, for any Fiscal Quarter, to be
less than $75,000,000, provided that this requirement shall be adjusted (i) to
subtract an amount equal to the results of operations of any Person or assets
which are the subject of a Disposition involving a consideration in excess of
$5,000,000 following the Closing Date, in each case for the last period of four
consecutive Fiscal Quarters prior to the Disposition thereof, and (ii) to add an
amount equal to the results of operations of any Person or assets acquired by
the Borrower and its Subsidiaries following the Closing Date for a consideration
which is in excess of $5,000,000, in each case for the first four Fiscal Quarter
period ending following their acquisition thereof.
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ARTICLE 7
INFORMATION AND REPORTING REQUIREMENTS
7.1 Financial and Business Information. So long as any Advance
remains unpaid, or any Letter of Credit remains outstanding or any other
Obligation remains unpaid, or any portion of the Commitments remains in force,
the Borrower shall, unless the Administrative Agent (with the written approval
of the Requisite Lenders) otherwise consents, at the Borrower's sole expense,
deliver to the Administrative Agent for distribution by it to the Lenders, a
sufficient number of copies for all of the Lenders of the following:
(a) As soon as practicable, and in any event within 45
days after the end of each Fiscal Quarter (other than the fourth Fiscal
Quarter in any Fiscal Year), the consolidated and consolidating balance
sheet of the Borrower and its Subsidiaries as at the end of such Fiscal
Quarter and the consolidated and consolidating statement of operations
for such Fiscal Quarter, and its statement of cash flows for the
portion of the Fiscal Year ended with such Fiscal Quarter, all in
reasonable detail, and with comparisons to the combined results of
operations, on a pro forma basis for the same Fiscal Quarter in the
prior year. Such financial statements shall be certified by a Senior
Officer of the Borrower as fairly presenting the financial condition,
results of operations and cash flows of the Borrower and its
Subsidiaries in accordance with Generally Accepted Accounting
Principles (other than footnote disclosures), consistently applied, as
at such date and for such periods, subject only to normal year-end
accruals and audit adjustments;
(b) As soon as practicable, and in any event within
ninety days after the end of each Fiscal Year, (i) the consolidated and
consolidating balance sheet of the Borrower and its Subsidiaries as at
the end of such Fiscal Year and the consolidated and consolidating
statements of operations, shareholders' equity and cash flows, in each
case of the Borrower and its Subsidiaries for such Fiscal Year, in each
case as at the end of and for the Fiscal Year, all in reasonable
detail. Such financial statements shall be prepared in accordance with
Generally Accepted Accounting Principles, consistently applied, and
such consolidated balance sheet and consolidated statements shall be
accompanied by a report of one of the five largest public accounting
firms in the United States of America or other independent public
accountants of recognized standing selected by the Borrower and
reasonably satisfactory to the Requisite Lenders, which report shall be
prepared in accordance with generally accepted auditing standards as at
such date, and shall not be subject to any qualifications or exceptions
as to the scope of the audit nor to any other qualification or
exception determined by the Requisite Lenders in their good faith
business judgment to be adverse to the interests of the Lenders. Such
accountants' report shall be accompanied by a certificate stating that,
in making the examination pursuant to generally accepted auditing
standards necessary for the certification of such financial statements
and such report, such accountants have obtained no knowledge of any
Default under Sections 6.13 through 6.15 or, if, in the opinion of such
accountants, any such Default shall exist, stating the nature of such
Default, and stating that such accountants have reviewed the Borrower's
financial calculations as at the end of such Fiscal Year (which shall
accompany such certificate) under Sections 6.13 through 6.15, have read
such Sections (including the definitions of all defined terms used
64
therein) and that nothing has come to the attention of such accountants
in the course of such examination that would cause them to believe that
the same were not calculated by the Borrower in the manner prescribed
by this Agreement;
(c) As soon as practicable, and in any event not later
than 45 days following the end of the Fiscal Quarter ending on each
June 30, a completed Pricing Certificate setting forth the Total
Leverage Ratio as of the last day of the that Fiscal Quarter;
(d) As soon as practicable, and in any event within 45
days after the commencement of each Fiscal Year, a budget and
projection by Fiscal Quarter for that Fiscal Year and by Fiscal Year
for the next two succeeding Fiscal Years, including for the first such
Fiscal Year, projected consolidated balance sheets, statements of
operations and statements of cash flow and, for the second and third
such Fiscal Years, projected consolidated condensed balance sheets and
statements of operations and cash flows, of the Borrower and its
Subsidiaries, all in reasonable detail;
(e) Promptly after request by the Administrative Agent or
any Lender, copies of any detailed audit reports, management letters or
recommendations submitted to the board of directors (or the audit
committee of the board of directors) of the Borrower by independent
accountants in connection with the accounts or books of the Borrower or
any of its Subsidiaries, or any audit of any of them;
(f) Promptly after the same are available, copies of each
annual report, proxy or financial statement or other report or
communication sent to the stockholders of the Borrower, and copies of
all annual, regular, periodic and special reports and registration
statements which the Borrower may file or be required to file with the
Securities and Exchange Commission under Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended, and not otherwise required
to be delivered to the Lenders pursuant to other provisions of this
Section;
(g) Promptly after request by the Administrative Agent or
any Lender, copies of the Nevada "Regulation 6.090 Report" and "6-A
Report";
(h) Promptly after request by the Administrative Agent or
any Lender, copies of any other report or other document that was filed
by the Borrower or any of its Subsidiaries with any Governmental Agency
(other than routine applications and reports filed by the Borrower and
its Subsidiaries with any Gaming Board);
(i) As soon as practicable, and in any event within 10
Business Days after a Senior Officer of the Borrower becomes aware of
the occurrence of any material (i) "reportable event" (as such term is
defined in Section 4043 of ERISA) or (ii) "prohibited transaction" (as
such term is defined in Section 406 of ERISA or Section 4975 of the
Code) in connection with any Pension Plan or any trust created
thereunder, telephonic notice specifying the nature thereof, and, no
more than five Business Days after such telephonic notice, written
notice again specifying the nature thereof and specifying what action
the Borrower or any of its Subsidiaries is taking
65
or proposes to take with respect thereto, and, when known, any action
taken by the Internal Revenue Service with respect thereto;
(j) As soon as practicable, and in any event within 2
Business Days after a Senior Officer of the Borrower becomes aware of
the existence of any condition or event which constitutes a Default or
Event of Default, telephonic notice specifying the nature and period of
existence thereof, and, no more than 2 Business Days after such
telephonic notice, written notice again specifying the nature and
period of existence thereof and specifying what action the Borrower or
its Subsidiaries are taking or propose to take with respect thereto;
(k) Promptly upon a Senior Officer of the Borrower
becoming aware that (i) any Person has commenced a legal proceeding
with respect to a claim against the Borrower or any of its Subsidiaries
that is $5,000,000 or more in excess of the amount thereof that is
fully covered by insurance, (ii) any creditor or lessor under a written
credit agreement or material lease has asserted a default thereunder on
the part of the Borrower or any of its Subsidiaries, (iii) any Person
has commenced a legal proceeding with respect to a claim against the
Borrower or any of its Subsidiaries under a contract that is not a
credit agreement or material lease in excess of $5,000,000 or which
otherwise may reasonably be expected to result in a Material Adverse
Effect, (iv) any labor union has notified the Borrower of its intent to
strike the Borrower or any of its Subsidiaries on a date certain and
such strike would involve more than 100 employees of the Borrower or
its Subsidiaries, (v) any Gaming Board has indicated its intent to
consider or act upon a License Revocation or a fine or penalty of
$500,000 or more with respect to the Borrower or any of its
Subsidiaries, or (vi) any Governmental Agency has notified the Borrower
of the commencement of any material action, suit, proceeding or
investigation against the Borrower or any of its Subsidiaries by such
Governmental Agency, including any action, suit, proceeding or
investigation relating to any Hazardous Materials Laws, a written
notice describing the pertinent facts relating thereto and what action
the Borrower or its Subsidiaries are taking or propose to take with
respect thereto;
(l) Promptly and in any event within five Business Days
following the occurrence of any Change in Control, notice thereof;
(m) Such other data and information as from time to time
may be reasonably requested by the Administrative Agent, any Lender
(through the Administrative Agent) or the Requisite Lenders; and
(n) Promptly after the Borrower has notified the
Administrative Agent of any intention by the Borrower to treat the
Loans as being a "reportable transaction" (within the meaning of
Treasury Regulation Section 1.6011-4) a duly completed copy of IRS Form
8886 or any successor form.
7.2 Compliance Certificates. So long as any Advance remains
unpaid, or any Letter of Credit remains outstanding or any other Obligation
remains unpaid or unperformed, or any portion of the Commitments remains
outstanding, the Borrower shall, at its sole expense, deliver to the
Administrative Agent for distribution by it to the Lenders concurrently with the
financial
66
statements required pursuant to Sections 7.1(a) and 7.1(b), Compliance
Certificates signed by a Senior Officer of the Borrower.
ARTICLE 8
CONDITIONS
8.1 Initial Advances on the Closing Date. The obligation of each
Lender to make the initial Advance to be made by it on the Closing Date, is
subject to the following conditions precedent, each of which shall be satisfied
prior to the making of the initial Advances (unless all of the Lenders, in their
sole and absolute discretion, shall agree otherwise):
(a) The Administrative Agent shall have received all of
the following, each of which shall be originals unless otherwise
specified, each properly executed by a Responsible Official of each
party thereto, each dated as of the Closing Date (unless otherwise
specified or unless the Administrative Agent otherwise agrees) and each
in form and substance reasonably satisfactory to the Administrative
Agent and its legal counsel:
(1) executed counterparts of this Agreement,
sufficient in number for distribution to the Administrative
Agent, the Lenders and the Borrower;
(2) a Note executed by the Borrower in favor of
each Lender, each in a principal amount equal to that Lender's
Pro Rata Share;
(3) with respect to the Borrower and its
Significant Subsidiary, such documentation as the
Administrative Agent may reasonably require to establish the
due incorporation or other organization, valid existence and
good standing of the Borrower and the Significant
Subsidiaries, their qualification to engage in business in
each material jurisdiction in which they are engaged in
business or required to be so qualified, their authority to
execute, deliver and perform any Loan Documents to which they
are a Party, the identity, authority and capacity of each
Responsible Official thereof authorized to act on their
behalf, including (if applicable) certified copies of articles
of incorporation or organization and amendments thereto,
bylaws or operating agreements and amendments thereto,
certificates of good standing and/or qualification to engage
in business, tax clearance certificates, certificates of
corporate or other organizational resolutions, incumbency
certificates, Certificates of Responsible Officials, and the
like;
(4) the Swing Line Documents;
(5) the Facilities Guaranty executed by each
Significant Subsidiary of the Borrower other than the Excluded
Subsidiaries;
(6) the Bally Gaming Facilities Guaranty and the
Plantation Facilities Guaranty;
(7) the Collateral Documents executed by the
parties thereto except that the Facilities Pledge Agreement
shall not include the stock of Bally Gaming,
67
Inc. or any other Subsidiary of Borrower until the expiration
of all notice periods and the obtaining of appropriate
consents under applicable Gaming Laws, as contemplated by
Section 5.12;
(8) the Title Policies;
(9) Stock certificates evidencing 100% of the
issued and outstanding shares of each Significant Subsidiary
of the Borrower, together with stock powers duly endorsed in
blank, except as contemplated by Section 5.12;
(10) a certificate of insurance issued by the
Borrower's insurance carrier or agent with respect to the
insurance required to be maintained pursuant to Section 5.4;
(11) the Opinions;
(12) a Request for Loan in compliance with
Article 2 (or in the appropriate case, a Request for Letter of
Credit in compliance with Article 2);
(13) the letter agreement described in Sections
3.2 and 3.5;
(14) such assurances as the Administrative Agent
deems appropriate that the relevant Gaming Boards have
approved the transactions contemplated by the Loan Documents
to the extent that such approval is required by applicable
Gaming Laws, except as contemplated by Section 5.12;
(15) a Certificate signed by a Senior Officer of
the Borrower certifying that the conditions specified in
Sections 8.1(d) and 8.1(e) have been satisfied;
(16) a Certificate signed by a Senior Officer of
the Borrower certifying that the attached copy of the
Indenture governing the Existing Senior Subordinated Notes is
true, correct and complete; and
(17) such other assurances, certificates,
documents, consents or opinions as the Administrative Agent
reasonably may require.
(b) The fees payable on the Closing Date pursuant to
Sections 3.2 and 3.6 and upfront fees payable to the Lenders shall have
been paid.
(c) The reasonable costs and expenses of the Joint Lead
Arrangers in connection with the syndication of the Loans and
preparation of the Loan Documents payable pursuant to Section 11.3, and
invoiced to the Borrower prior to the Closing Date, shall have been
paid.
(d) The representations and warranties of the Borrower
contained in Article 4 shall be true and correct.
68
(e) the Borrower and all other Parties shall be in
compliance with all the terms and provisions of the Loan Documents, and
giving effect to the initial Advance, no Default or Event of Default
shall have occurred and be continuing.
8.2 Any Increasing Advance. The obligation of each Lender to make
any Advance which results in an increase in the aggregate outstanding principal
amount of the Obligations, and the obligation of the Issuing Lender to issue a
Letter of Credit, is subject to the following conditions precedent (unless the
Requisite Lenders, in their sole and absolute discretion, shall agree
otherwise):
(a) except (i) for representations and warranties which
expressly speak as of a particular date or are no longer true and
correct as a result of a change which is permitted by this Agreement or
(ii) as disclosed by the Borrower and approved in writing by the
Requisite Lenders, the representations and warranties contained in
Article 4 (other than Sections 4.4(a), 4.6 (first sentence), 4.11, and
4.18) shall be true and correct on and as of the date of the Advance as
though made on that date;
(b) other than matters described in Schedule 4.11 or not
required as of the Closing Date to be therein described, there shall
not be then pending or threatened any action, suit, proceeding or
investigation against or affecting the Borrower or any of its
Subsidiaries or any Property of any of them before any Governmental
Agency that constitutes a Material Adverse Effect;
(c) the Administrative Agent shall have timely received a
Request for Loan in compliance with Article 2 (or telephonic or other
request for Loan referred to in the second sentence of Section 2.1(c),
if applicable) or the Issuing Lender shall have received a Request for
Letter of Credit, as the case may be, in compliance with Article 2; and
(d) the Administrative Agent shall have received, in form
and substance satisfactory to the Administrative Agent, such other
assurances, certificates, documents or consents related to the
foregoing as the Administrative Agent or Requisite Lenders reasonably
may require.
ARTICLE 9
EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT
9.1 Events of Default. The existence or occurrence of any one or
more of the following events, whatever the reason therefor and under any
circumstances whatsoever, shall constitute an Event of Default:
(a) the Borrower fails to pay any principal on any of the
Notes, or any portion thereof, on the date when due; or
(b) the Borrower fails to pay any interest on any of the
Notes, or any fees under Article 3, or any portion thereof, within 2
Business Days after the date when due; or fails to pay any other fee or
amount payable to the Lenders under any Loan Document, or any portion
thereof, within five Business Days after demand therefor; or
69
(c) the Borrower fails to comply with any of the
covenants contained in Article 6, other than the covenants contained in
Sections 6.6, 6.7, or 6.10; or
(d) the Borrower fails to comply with Section 7.1(j) in
any respect that is materially adverse to the interests of the Lenders;
or
(e) the Borrower, any of its Subsidiaries or any other
Party fails to perform or observe any other covenant or agreement (not
specified in clause (a), (b), (c), or (d) above) contained in any Loan
Document on its part to be performed or observed within 25 Business
Days after the giving of notice by the Administrative Agent on behalf
of the Requisite Lenders of such Default; or
(f) Any representation or warranty of the Borrower or any
of its Subsidiaries or any other Party made in any Loan Document, or in
any certificate or other writing delivered by the Borrower or such
Subsidiary or Party pursuant to any Loan Document, proves to have been
incorrect when made or reaffirmed; or
(g) the Borrower or any of its Subsidiaries (i) fails to
pay the principal, or any principal installment, of any present or
future Indebtedness of $10,000,000 or more, or any guaranty of present
or future Indebtedness of $10,000,000 or more, on its part to be paid,
when due (or within any stated grace period), whether at the stated
maturity, upon acceleration, by reason of required prepayment or
otherwise or (ii) fails to perform or observe any other term, covenant
or agreement on its part to be performed or observed, or suffers any
event of default to occur, in connection with any present or future
Indebtedness of $10,000,000 or more, or of any guaranty of present or
future Indebtedness of $10,000,000 or more, if as a result of such
failure or sufferance any holder or holders thereof (or an agent or
trustee on its or their behalf) has the right to declare such
Indebtedness due before the date on which it otherwise would become due
or the right to require the Borrower or any of its Subsidiaries to
redeem or purchase, or offer to redeem or purchase, all or any portion
of such Indebtedness; or
(h) Any event occurs which gives the holder or holders of
any Subordinated Obligation (or an agent or trustee on its or their
behalf) the right to declare such Subordinated Obligation due before
the date on which it otherwise would become due, or the right to
require the issuer thereof to redeem or purchase, or offer to redeem or
purchase, all or any portion of any Subordinated Obligation; or the
trustee for, or any holder of, a Subordinated Obligation breaches any
subordination provision applicable to such Subordinated Obligation; or
(i) Any Loan Document, at any time after its execution
and delivery and for any reason other than the agreement or action (or
omission to act) of the Administrative Agent or any of the Lenders or
satisfaction in full of all the Obligations ceases to be in full force
and effect or is declared by a court of competent jurisdiction to be
null and void, invalid or unenforceable in any respect which, in any
such event in the reasonable opinion of the Requisite Lenders, is
materially adverse to the interests of the Lenders; or any Party
thereto denies in writing that it has any or further liability or
obligation under any Loan Document, or purports to revoke, terminate or
rescind same; or
70
(j) A final judgment against the Borrower or any of its
Subsidiaries is entered for the payment of money in excess of
$5,000,000 and, absent procurement of a stay of execution, such
judgment remains unsatisfied for 30 days after the date of entry of
judgment, or in any event later than five days prior to the date of any
proposed sale thereunder; or any writ or warrant of attachment or
execution or similar process is issued or levied against all or any
material part of the Property of any such Person and is not released,
vacated or fully bonded within 30 days after its issue or levy; or
(k) the Borrower or any of its Subsidiaries institutes or
consents to the institution of any proceeding under a Debtor Relief Law
relating to it or to all or any material part of its Property, or is
unable or admits in writing its inability to pay its debts as they
mature, or makes an assignment for the benefit of creditors; or applies
for or consents to the appointment of any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer for it or for
all or any material part of its Property; or any receiver, trustee,
custodian, conservator, liquidator, rehabilitator or similar officer is
appointed without the application or consent of that Person and the
appointment continues undischarged or unstayed for ninety days; or any
proceeding under a Debtor Relief Law relating to any such Person or to
all or any part of its Property is instituted without the consent of
that Person and continues undismissed or unstayed for ninety days; or
(l) The occurrence of an Event of Default (as such term
is or may hereafter be specifically defined in any other Loan Document)
under any other Loan Document; or
(m) A final judgment is entered by a court of competent
jurisdiction that any Subordinated Obligation is not subordinated in
accordance with its terms to the Obligations; or
(n) Any Pension Plan maintained by the Borrower or any of
its Subsidiaries is determined to have a material "accumulated funding
deficiency" as that term is defined in Section 302 of ERISA and the
result is a Material Adverse Effect or the Borrower or any of its ERISA
Affiliates incurs any withdrawal liability in respect of any
Multiemployer Plan which is in an amount in excess of $10,000,000 which
withdrawal liability is not paid or otherwise satisfied within 30 days;
or
(o) The occurrence of a License Revocation affecting the
main operating licenses of any of United Coin Machine Co., Plantation
Investments, Inc. (d/b/a Rail City Casino) or Rainbow Casino Vicksburg
Partnership LP (d/b/a Rainbow Casino) that continues for three
consecutive days; or
(p) a Change in Control occurs.
9.2 Remedies Upon Event of Default. Without limiting any other
rights or remedies of the Creditors provided for elsewhere in this Agreement, or
the other Loan Documents, or by applicable Law, or in equity, or otherwise:
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(a) Upon the occurrence and during the continuance of any
Event of Default other than an Event of Default described in Section
9.1(k) with respect to the Borrower or any Significant Subsidiary:
(1) the Commitments to make Advances, the
obligation of the Issuing Lender to issue Letters of Credit,
the obligation of the Swing Line Lender to make Swing Line
Loans and all other obligations of the Creditors and all
rights of the Borrower and any other Parties under the Loan
Documents shall be suspended without notice to or demand upon
the Borrower which are expressly waived by the Borrower,
except that all of the Requisite Lenders (or, if required by
Section 11.2, another group of the Lenders) may waive an Event
of Default or, without waiving, determine, upon terms and
conditions satisfactory to the Lenders or Requisite Lenders,
as the case may be, to reinstate the Commitments and such
other obligations and rights and make Advances, and cause the
Issuing Lender to issue further Letters of Credit which waiver
or determination shall apply equally to, and shall be binding
upon, all the Lenders;
(2) the Issuing Lender may, with the approval of
the Administrative Agent on behalf of the Requisite Lenders,
demand immediate payment by the Borrower of an amount equal to
the aggregate amount of all outstanding Letters of Credit to
be held by the Issuing Lender in an interest-bearing cash
collateral account as collateral hereunder; and
(3) the Requisite Lenders may request the
Administrative Agent to, and the Administrative Agent
thereupon shall, terminate the Commitments and/or declare all
or any part of the unpaid principal of all Notes, all interest
accrued and unpaid thereon and all other amounts payable under
the Loan Documents to be forthwith due and payable, whereupon
the same shall become and be forthwith due and payable,
without protest, presentment, notice of dishonor, demand or
further notice of any kind, all of which are expressly waived
by the Borrower.
(b) Upon the occurrence and during the continuance of any
Event of Default described in Section 9.1(k) with respect to the
Borrower or any of its Significant Subsidiaries:
(1) the Commitments to make Advances, the
obligation of the Issuing Lender to issue Letters of Credit,
the obligation of the Swing Line Lender to make Swing Line
Loans and all other obligations of the Creditors and all
rights of the Borrower and any other Parties under the Loan
Documents shall terminate without notice to or demand upon the
Borrower, which are expressly waived by the Borrower, except
that all of the Lenders may waive the Event of Default or,
without waiving, determine, upon terms and conditions
satisfactory to all the Lenders, to reinstate the Commitments
and such other obligations and rights and make further
Advances and to cause the Issuing Lender to issue further
Letters of Credit, which determination shall apply equally to,
and shall be binding upon, all the Lenders;
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(2) an amount equal to the aggregate amount of
all outstanding Letters of Credit shall be immediately due and
payable to the Issuing Lender without notice to or demand upon
the Borrower, which are expressly waived by the Borrower, to
be held by the Issuing Lender in an interest-bearing cash
collateral account as collateral hereunder; and
(3) the unpaid principal of all Notes, all
interest accrued and unpaid thereon and all other amounts
payable under the Loan Documents shall be forthwith due and
payable, without protest, presentment, notice of dishonor,
demand or further notice of any kind, all of which are
expressly waived by the Borrower.
(c) Upon the occurrence, and during the continuance, of
any Event of Default, the Creditors, or any of them, without notice to
(except as expressly provided for in any Loan Document) or demand upon
the Borrower, which are expressly waived by the Borrower (except as to
notices expressly provided for in any Loan Document), may proceed (but
only with the consent of the Requisite Lenders) to protect, exercise
and enforce their rights and remedies under the Loan Documents against
the Borrower and any other Party and such other rights and remedies as
are provided by Law or equity.
(d) The order and manner in which the Creditors' rights
and remedies are to be exercised shall be determined by the Requisite
Lenders in their sole discretion, and all payments received by the
Creditors, or any of them, shall be applied first to the costs and
expenses (including reasonable attorneys' fees and disbursements and
the reasonably allocated costs of attorneys employed by any of the
Creditors) of the Creditors, and thereafter paid pro rata to the
Lenders in the same proportions that the aggregate Obligations owed to
each Lender under the Loan Documents bear to the aggregate Obligations
owed under the Loan Documents to all the Lenders, without priority or
preference among the Lenders. Regardless of how each Lender may treat
payments for the purpose of its own accounting, for the purpose of
computing the Obligations hereunder and under the Notes, payments shall
be applied first, to the costs and expenses of the Creditors, as set
forth above, second, to the payment of accrued and unpaid interest due
under any Loan Documents to and including the date of such application
(ratably, and without duplication, according to the accrued and unpaid
interest due under each of the Loan Documents), and third, to the
payment of all other amounts (including principal and fees) then owing
to the Creditors under the Loan Documents. No application of payments
will cure any Event of Default, or prevent acceleration, or continued
acceleration, of amounts payable under the Loan Documents, or prevent
the exercise, or continued exercise, of rights or remedies of the
Lenders hereunder or thereunder or at Law or in equity.
ARTICLE 10
THE ADMINISTRATIVE AGENT
10.1 Appointment and Authorization of Administrative Agent.
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(a) Each Lender hereby irrevocably appoints, designates
and authorizes the Administrative Agent to take such action on its
behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other
Loan Document, together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained
elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Administrative Agent have or
be deemed to have any fiduciary relationship with any Lender or
participant, and no implied covenants, functions, responsibilities,
duties, obligations or liabilities shall be read into this Agreement or
any other Loan Document or otherwise exist against the Administrative
Agent. Without limiting the generality of the foregoing sentence, the
use of the term "agent" herein and in the other Loan Documents with
reference to the Administrative Agent is not intended to connote any
fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used
merely as a matter of market custom, and is intended to create or
reflect only an administrative relationship between independent
contracting parties.
(b) The Issuing Lender shall act on behalf of the Lenders
with respect to any Letters of Credit issued by it and the documents
associated therewith, and the Issuing Lender shall have all of the
benefits and immunities (i) provided to the Administrative Agent in
this Article X with respect to any acts taken or omissions suffered by
the Issuing Lender in connection with Letters of Credit issued by it or
proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Letters of Credit as fully as if
the term "Administrative Agent" as used in this Article X and in the
definition of "Agent-Related Person" included the Issuing Lender with
respect to such acts or omissions, and (ii) as additionally provided
herein with respect to the Issuing Lender.
10.2 Delegation of Duties. The Administrative Agent may execute any
of its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel and other consultants or experts concerning all matters pertaining to
such duties. The Administrative Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects in the
absence of gross negligence or willful misconduct.
10.3 Liability of Administrative Agent. No Agent-Related Person
shall (a) be liable to any Lender for any action taken or omitted to be taken by
any of them under or in connection with this Agreement or any other Loan
Document or the transactions contemplated hereby (except for its own gross
negligence or willful misconduct in connection with its duties expressly set
forth herein), or (b) be responsible in any manner to any Lender or Participant
for any recital, statement, representation or warranty made by the Borrower or
any officer thereof, contained herein or in any other Loan Document, or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of the Borrower or any other party to any Loan
Document to perform its obligations hereunder or thereunder. No Agent-Related
Person shall be under any obligation to any Lender or Participant
74
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Borrower or any
Affiliate thereof.
10.4 Reliance by Administrative Agent.
(a) The Administrative Agent shall be entitled to rely,
and shall be fully protected in relying, upon any writing,
communication, signature, resolution, representation, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, electronic mail message, statement or other document or
conversation believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to the Borrower),
independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified
in failing or refusing to take any action under any Loan Document
unless it shall first receive such advice or concurrence of the
Requisite Lenders as it deems appropriate and, if it so requests, it
shall first be indemnified to its satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative
Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Requisite Lenders (or such
greater number of Lenders as may be expressly required hereby in any
instance) and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the
conditions specified in Section 8.1, each Lender that has signed this
Agreement shall be deemed to have consented to, approved or accepted or
to be satisfied with, each document or other matter required thereunder
to be consented to or approved by or acceptable or satisfactory to a
Lender unless the Administrative Agent shall have received notice from
such Lender prior to the Closing Date specifying its objection thereto.
10.5 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default, except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a "notice of default." The Administrative Agent will notify the
Lenders of its receipt of any such notice. The Administrative Agent shall take
such action with respect to such Default as may be directed by the Requisite
Lenders in accordance with Article IX; provided, however, that unless and until
the Administrative Agent has received any such direction, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default as it shall deem advisable or
in the best interest of the Lenders.
10.6 Credit Decision; Disclosure of Information by Administrative
Agent. Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and
75
acceptance of any assignment or review of the affairs of the Borrower or any
Affiliate thereof, shall be deemed to constitute any representation or warranty
by any Agent-Related Person to any Lender as to any matter, including whether
Agent-Related Persons have disclosed material information in their possession.
Each Lender represents to the Administrative Agent that it has, independently
and without reliance upon any Agent-Related Person and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Borrower and its Subsidiaries, and
all applicable bank or other regulatory laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower hereunder. Each Lender also represents that it
will, independently and without reliance upon any Agent-Related Person and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent herein, the Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Borrower or any of its Affiliates which may
come into the possession of any Agent-Related Person.
10.7 Indemnification of Administrative Agent. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of the Borrower and without limiting the obligation of the Borrower to do
so), pro rata, and hold harmless each Agent-Related Person from and against any
and all Indemnified Liabilities incurred by it; provided, however, that no
Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities to the extent determined in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Agent-Related Person's own gross negligence or willful misconduct;
provided, however, that no action taken in accordance with the directions of the
Requisite Lenders shall be deemed to constitute gross negligence or willful
misconduct for purposes of this Section. Without limitation of the foregoing,
each Lender shall reimburse the Administrative Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including all Attorneys Costs)
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any other
Loan Document, or any document contemplated by or referred to herein, to the
extent that the Administrative Agent is not reimbursed for such expenses by or
on behalf of the Borrower. To the extent that the Administrative Agent is later
reimbursed such cost or expense by the Borrower or any other Party, it shall
return the amounts paid to it by the Lenders in respect of such cost or expense.
The undertaking in this Section shall survive termination of the Commitments,
the payment of all other Obligations and the resignation of the Administrative
Agent.
10.8 Administrative Agent in its Individual Capacity. Bank of
America and its Affiliates may make loans to, issue letters of credit for the
account of, accept deposits from,
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acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Borrower and its
Affiliates as though Bank of America were not the Administrative Agent or
Issuing Lender hereunder and without notice to or consent of the Lenders. The
Lenders acknowledge that, pursuant to such activities, Bank of America or its
Affiliates may receive information regarding the Borrower or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of the Borrower or such Affiliate) and acknowledge that the Administrative
Agent shall be under no obligation to provide such information to them other
than as otherwise contemplated hereby. With respect to its Loans, Bank of
America shall have the same rights and powers under this Agreement as any other
Lender and may exercise such rights and powers as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" include Bank of
America in its individual capacity.
10.9 Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 30 days' notice to the Lenders; provided
that any such resignation by Bank of America shall also constitute its
resignation as Issuing Lender and Swing Line Lender. If the Administrative Agent
resigns under this Agreement, the Requisite Lenders shall appoint from among the
Lenders a successor administrative agent for the Lenders, which successor
administrative agent shall be consented to by the Borrower at all times other
than during the existence of an Event of Default (which consent of the Borrower
shall not be unreasonably withheld or delayed). If no successor administrative
agent is appointed prior to the effective date of the resignation of the
Administrative Agent, the Administrative Agent may appoint, after consulting
with the Lenders and the Borrower, a successor administrative agent from among
the Lenders. Upon the acceptance of its appointment as successor administrative
agent hereunder, the Person acting as such successor administrative agent shall
succeed to all the rights, powers and duties of the retiring Administrative
Agent, Issuing Lender and Swing Line Lender and the respective terms
"Administrative Agent", "Issuing Lender" and "Swing Line Lender" shall mean such
successor Administrative Agent, Issuing Lender and Swing Line Lender and the
retiring Administrative Agent's appointment, powers and duties as Administrative
Agent shall be terminated and the retiring Issuing Lender's and Swing Line
Lender's rights, powers and duties as such shall be terminated, without any
other or further act or deed on the part of such retiring Issuing Lender or
Swing Line Lender or any other Lender, other than the obligation of the
successor Issuing Lender to issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or to make
other arrangements satisfactory to the retiring Issuing Lender to effectively
assume the obligations of the retiring Issuing Lender with respect to such
Letters of Credit. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article VII and
Section 9.03 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement. If no
successor administrative agent has accepted appointment as Administrative Agent
by the date which is 30 days following a retiring Administrative Agent's notice
of resignation, the retiring Administrative Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of the Administrative Agent hereunder until such time, if any, as the
Requisite Lenders appoint a successor agent as provided for above.
10.10 Administrative Agent May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment,
77
composition or other judicial proceeding relative to the Borrower, the
Administrative Agent (irrespective of whether the principal of any Loan or
Letter of Credit shall then be due and payable as herein expressed or by
declaration or otherwise and irrespective of whether the Administrative Agent
shall have made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans, Letter
of Credit and all other Obligations that are owing and unpaid and to
file such other documents as may be necessary or advisable in order to
have the claims of the Lenders and the Administrative Agent (including
any claim for the reasonable compensation, expenses, disbursements and
advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and
the Administrative Agent under Section 11.3) allowed in such judicial
proceeding; and
(b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Section 11.3.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
10.11 Other Agents; Arrangers and Managers. None of the Lenders or
other Persons identified in this Agreement as a "syndication agent," "co-agent,"
"joint book manager," or "joint lead arranger" shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than,
in the case of such Lenders, those applicable to all Lenders as such. Without
limiting the foregoing, none of the Lenders or other Persons so identified shall
have or be deemed to have any fiduciary relationship with any Lender. Each
Lender acknowledges that it has not relied, and will not rely, on any of the
Lenders or other Persons so identified in deciding to enter into this Agreement
or in taking or not taking action hereunder.
10.12 Collateral Matters. (a) The Administrative Agent is authorized
on behalf of itself and all Lenders, without the necessity of any notice to or
further consent from the Lenders, from time to time to take any action with
respect to any Collateral or the Collateral Documents which may be necessary to
perfect and maintain perfected the security interest in and Liens upon the
Collateral granted pursuant to the Collateral Documents.
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(b) The Lenders irrevocably authorize the Administrative
Agent, at its option and in its discretion, to release any Lien granted
to or held by the Administrative Agent upon any Collateral (i) upon
termination of the Commitments and payment in full of all Loans and all
other Obligations known to the Administrative Agent and payable under
this Agreement or any other Loan Document; (ii) constituting property
sold or to be sold or disposed of as part of or in connection with any
disposition permitted hereunder; (iii) constituting property in which
the Borrower or any Subsidiary owned no interest at the time the Lien
was granted or at any time thereafter; (iv) consisting of an instrument
evidencing Indebtedness or other debt instrument, if the indebtedness
evidenced thereby has been paid in full; (v) as provided in any
Collateral Document; or (vi) if approved, authorized or ratified in
writing by the Requisite Lenders or all the Lenders, as the case may
be, as provided in Section 11.2. Upon request by the Administrative
Agent at any time, the Lenders will confirm in writing the
Administrative Agent's authority to release particular types or items
of Collateral pursuant to this Section 10.12(b).
ARTICLE 11
MISCELLANEOUS
11.1 Cumulative Remedies; No Waiver. The rights, powers, privileges
and remedies of the Creditors provided herein or in any Note or other Loan
Document are cumulative and not exclusive of any right, power, privilege or
remedy provided by Law or equity. No failure or delay on the part of the
Administrative Agent or any Lender in exercising any right, power, privilege or
remedy may be, or may be deemed to be, a waiver thereof; nor may any single or
partial exercise of any right, power, privilege or remedy preclude any other or
further exercise of the same or any other right, power, privilege or remedy. The
terms and conditions of Article 8 hereof are inserted for the sole benefit of
the Creditors; the same may be waived in whole or in part, with or without terms
or conditions, in respect of any Loan or Letter of Credit without prejudicing
the Administrative Agent's or the Lenders' rights to assert them in whole or in
part in respect of any other Loan.
11.2 Amendments; Consents.
No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower therefrom, shall
be effective unless in writing signed by the Requisite Lenders and the Borrower,
and acknowledged by the Administrative Agent, and each such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided, however, that no such amendment, waiver or consent
shall:
(a) waive any condition set forth in Article VIII without
the written consent of each Lender;
(b) extend or increase the Commitment of any Lender (or
reinstate any Commitment terminated pursuant to Section 9.1) without
the written consent of such Lender;
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(c) postpone any date fixed by this Agreement or any
other Loan Document for any payment or mandatory prepayment of
principal, interest, fees or other amounts due to the Lenders (or any
of them) or any scheduled or mandatory reduction of the Commitments
hereunder or under any other Loan Document without the written consent
of each Lender directly affected thereby;
(d) reduce the principal of, or the rate of interest
specified herein on, any Loan or (subject to clause (ii) of the second
proviso to this Section 11.2) any fees or other amounts payable
hereunder or under any other Loan Document without the written consent
of each Lender directly affected thereby;
(e) change Section 11.10 in a manner that would alter the
pro rata sharing of payments required thereby without the written
consent of each Lender; or
(f) change any provision of this Section or the
definition of "Requisite Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to amend, waive
or otherwise modify any rights hereunder or make any determination or
grant any consent hereunder, without the written consent of each
Lender;
(g) change any provision of this Agreement if such
amendment, waiver or consent adversely affects the holders of the Term
Notes without the written consent of the Lenders having Pro Rata Shares
of the Term Commitment which are, in the aggregate, 51% or more of the
Pro Rata Shares of the aggregate Term Commitment then in effect;
(h) change any provision of this Agreement if such
amendment, waiver or consent adversely affects the holders of the
Revolving Notes without the written consent of the Lenders having Pro
Rata Shares of the Revolving Commitment which are, in the aggregate,
51% or more of the Pro Rata Shares of the aggregate Revolving
Commitment then in effect;
(i) release from the Guaranties any Subsidiaries having
aggregate total assets in excess of $5,000,000 except to the extent
that such Subsidiaries are the subject of any Disposition permitted
hereby, or to release any assets from the Liens of the Collateral
Documents having a value in excess of $5,000,000 (other than in
accordance with the terms of the Loan Documents), without the written
consent of all Lenders;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Lender in addition to the Lenders required
above, affect the rights or duties of the Issuing Lender under this Agreement or
any Letter of Credit application relating to any Letter of Credit issued or to
be issued by it; (ii) no amendment, waiver or consent shall, unless in writing
and signed by the Swing Line Lender in addition to the Lenders required above,
affect the rights or duties of the Swing Line Lender under this Agreement; (iii)
no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; (iv) Section 11.8(h) may not be amended, waived or otherwise
modified without the consent of each Granting Lender all or any part of whose
Loans
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are being funded by an SPC at the time of such amendment, waiver or other
modification; and (v) any fee letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
11.3 Costs, Expenses and Taxes; Indemnification.
(a) The Borrower agrees (a) to pay or reimburse each
Joint Lead Arranger for all reasonable costs and expenses incurred in
connection with the development, preparation, negotiation and execution
of this Agreement and the other Loan Documents and any amendment,
waiver, consent or other modification of the provisions hereof and
thereof (whether or not the transactions contemplated hereby or thereby
are consummated), and the consummation and administration of the
transactions contemplated hereby and thereby, including all Attorneys
Costs, and (b) to pay or reimburse the Administrative Agent and each
Lender for all reasonable costs and expenses incurred after an Event of
Default in connection with the enforcement, attempted enforcement, or
preservation of any rights or remedies under this Agreement or the
other Loan Documents (including all such costs and expenses incurred
after an Event of Default during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including
any proceeding under any Debtor Relief Law), including all Attorneys
Costs. The foregoing costs and expenses shall include all search,
filing, recording, title insurance and appraisal charges and fees and
taxes related thereto, and other out-of-pocket expenses incurred by the
Administrative Agent and the cost of independent public accountants and
other outside experts retained by the Administrative Agent or any
Lender. All amounts due under this Section 11.3(a) shall be payable
within ten Business Days after demand therefor. The agreements in this
Section shall survive the termination of the Commitments and repayment
of all other Obligations.
(b) Whether or not the transactions contemplated hereby
are consummated, the Borrower shall indemnify and hold harmless each
Agent-Related Person, each Joint Lead Arranger, each Lender and their
respective Affiliates, directors, trustees, officers, employees,
counsel, agents and attorneys-in-fact (collectively the "Indemnitees")
from and against any and all liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses
and disbursements (including Attorneys Costs) of any kind or nature
whatsoever which may at any time be imposed on, incurred by or asserted
against any such Indemnitee in any way relating to or arising out of or
in connection with (a) the execution, delivery, enforcement,
performance or administration of any Loan Document or any other
agreement, letter or instrument delivered in connection with the
transactions contemplated thereby or the consummation of the
transactions contemplated thereby, (b) any Commitment, Loan or Letter
of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the Issuing Lender to honor a demand for
payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of
such Letter of Credit), or (c) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the
foregoing, whether based on contract, tort or any other theory
(including any investigation of, preparation for, or defense of any
pending or threatened claim, investigation, litigation or proceeding)
and regardless of whether any Indemnitee is a party thereto (all the
foregoing, collectively, the "Indemnified
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Liabilities") provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such liabilities,
obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses or disbursements are determined by a
court of competent jurisdiction by final and nonappealable judgment to
have resulted from the gross negligence or willful misconduct of such
Indemnitee. No Indemnitee shall be liable for any damages arising from
the use by others of any information or other materials obtained
through IntraLinks or other similar information transmission systems in
connection with this Agreement, nor shall any Indemnitee have any
liability for any indirect or consequential damages relating to this
Agreement or any other Loan Document or arising out of its activities
in connection herewith or therewith (whether before or after the
Closing Date). All amounts due under this Section 11.3(b) shall be
payable within ten Business Days after demand therefor. The agreements
in this Section shall survive the resignation of the Administrative
Agent, the replacement of any Lender, the termination of the
Commitments and the repayment, satisfaction or discharge of all the
other Obligations.
11.4 Nature of Lenders' Obligations. The obligations of the Lenders
hereunder are several and not joint or joint and several. Nothing contained in
this Agreement or any other Loan Document and no action taken by the Creditors
or any of them pursuant hereto or thereto may, or may be deemed to, make the
Lenders a partnership, an association, a joint venture or other entity, either
among themselves or with the Borrower or any Affiliate of the Borrower. Each
Lender's obligation to make any Advance pursuant hereto is several and not joint
or joint and several, and in the case of the initial Advance only is conditioned
upon the performance by all other Lenders of their obligations to make initial
Advances. A default by any Lender will not increase the Pro Rata Share of the
Commitments of any other Lender. Any Lender not in default may, if it desires,
assume in such proportion as the nondefaulting Lenders agree the obligations of
any Lender in default, but is not obligated to do so.
11.5 Survival of Representations and Warranties. All
representations and warranties contained herein or in any other Loan Document,
or in any certificate or other writing delivered by or on behalf of any one or
more of the Parties to any Loan Document, will survive the making of the Loans
hereunder and the execution and delivery of the Notes, and have been or will be
relied upon by the Administrative Agent and each Lender, notwithstanding any
investigation made by the Administrative Agent or any Lender or on their behalf.
11.6 Notices.
Unless otherwise expressly provided herein, all notices and other
communications provided for hereunder shall be in writing (including by
facsimile transmission). All such written notices shall be mailed, faxed or
delivered to the applicable address, facsimile number or (subject to subsection
(c) below) electronic mail address, and all notices and other communications
expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:
(a) if to the Borrower, the Administrative Agent, the
Issuing Lender or the Swing Line Lender to the address, facsimile
number, electronic mail address or telephone number specified for such
Person on its signature page hereto or to such other address,
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facsimile number, electronic mail address or telephone number as shall
be designated by such party in a notice to the other parties; and
(b) if to any other Lender, to the address, facsimile
number, electronic mail address or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile
number, electronic mail address or telephone number as shall be
designated by such party in a notice to the Borrower, the
Administrative Agent, the Issuing Lender and the Swing Line Lender.
All such notices and other communications shall be deemed to be given or made
upon the earlier to occur of (i) actual receipt by the relevant party hereto and
(ii) (A) if delivered by hand or by courier, when signed for by or on behalf of
the relevant party hereto; (B) if delivered by mail, four Business Days after
deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent
and receipt has been confirmed by telephone; and (D) if delivered by electronic
mail (which form of delivery is subject to the provisions of subsection (c)
below), when delivered; provided, however, that notices and other communications
to the Administrative Agent, the Issuing Lender and the Swing Line Lender
pursuant to Article II shall not be effective until actually received by such
Person. In no event shall a voicemail message be effective as a notice,
communication or confirmation hereunder.
(c) Loan Documents may be transmitted and/or signed by
facsimile. The effectiveness of any such documents and signatures
shall, subject to applicable law, have the same force and effect as
manually-signed originals and shall be binding on all parties hereto.
The Administrative Agent may also require that any such documents and
signatures be confirmed by a manually-signed original thereof;
provided, however, that the failure to request or deliver the same
shall not limit the effectiveness of any facsimile document or
signature.
(d) Electronic mail and Internet and intranet websites
may be used only to distribute routine communications, such as
financial statements and other information as provided in Section 7.1,
and to distribute Loan Documents for execution by the parties thereto,
and may not be used for any other purpose.
(e) The Administrative Agent and the Lenders shall be
entitled to rely and act upon any notices (including telephonic Request
for Loan and Request for Letter of Credit) purportedly given by or on
behalf of the Borrower even if (i) such notices were not made in a
manner specified herein, were incomplete or were not preceded or
followed by any other form of notice specified herein, or (ii) the
terms thereof, as understood by the recipient, varied from any
confirmation thereof. The Borrower shall indemnify each Agent-Related
Person and each Lender from all losses, costs, expenses and liabilities
resulting from the reliance by such Person on each notice purportedly
given by or on behalf of the Borrower. All telephonic notices to and
other communications with the Administrative Agent may be recorded by
the Administrative Agent, and each of the parties hereto hereby
consents to such recording.
11.7 Execution of Loan Documents. Unless the Administrative Agent
otherwise specifies with respect to any Loan Document, (a) this Agreement and
any other Loan Document
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may be executed in any number of counterparts and any party hereto or thereto
may execute any counterpart, each of which when executed and delivered will be
deemed to be an original and all of which counterparts of this Agreement or any
other Loan Document, as the case may be, when taken together will be deemed to
be but one and the same instrument and (b) execution of any such counterpart may
be evidenced by a telecopier transmission of the signature of such party
followed by prompt transmission of an original signature. The execution of this
Agreement or any other Loan Document by any party hereto or thereto will not
become effective until counterparts hereof or thereof, as the case may be, have
been executed by all the parties hereto or thereto.
11.8 Successors and Assigns.
(a) The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that the
Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender
and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of subsection (b) of this Section, (ii) by way of
participation in accordance with the provisions of subsection (d) of
this Section, (iii) by way of pledge or assignment of a security
interest subject to the restrictions of subsection (f) or (i) of this
Section, or (iv) to an SPC in accordance with the provisions of
subsection (h) of this Section (and any other attempted assignment or
transfer by any party hereto shall be null and void). Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and
assigns permitted hereby, Participants to the extent provided in
subsection (d) of this Section and, to the extent expressly
contemplated hereby, the Indemnitees) any legal or equitable right,
remedy or claim under or by reason of this Agreement. Each Lender
represents that it is not acquiring its Note with a view to the
distribution thereof within the meaning of the Securities Act of 1933,
as amended (subject to any requirement that disposition of such Note
must be within the control of such Lender).
(b) Any Lender may at any time assign to one or more
Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitments and its
Loans (including for purposes of this subsection (b), participations in
Letter of Credit and in Swing Line Loans) at the time owing to it);
provided that (i) except in the case of an assignment of the entire
remaining amount of the assigning Lender's Commitment and Loans at the
time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund (as defined in subsection (g)
of this Section) with respect to a Lender, the aggregate amount of the
Commitment (which for this purpose includes Loans outstanding
thereunder) subject to each such assignment, determined as of the date
the Assignment Agreement with respect to such assignment is delivered
to the Administrative Agent or, if "Trade Date" is specified in the
Assignment Agreement, as of the Trade Date, shall not be less than
$1,000,000 unless each of the Administrative Agent and, so long as no
Default has occurred and is continuing, the Borrower otherwise consents
(each such consent not to be unreasonably withheld or delayed); (ii)
each partial assignment shall be made as an
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assignment of a proportionate part of all the assigning Lender's rights
and obligations under this Agreement with respect to the Loans or the
Commitment assigned, except that this clause (ii) shall not apply to
rights in respect of Swing Line Loans; (iii) any assignment must be
approved by the Administrative Agent, the Issuing Lender and the Swing
Line Lender and, as long as no Default has occurred and is continuing,
the Borrower (each such consent not to be unreasonably withheld or
delayed) unless the Person that is the proposed assignee is itself a
Lender or Approved Fund (whether or not the proposed assignee would
otherwise qualify as an Eligible Assignee); and (iv) the parties to
each assignment shall execute and deliver to the Administrative Agent
an Assignment Agreement, together with a processing and recordation fee
of $3,500 (provided that only a single such fee shall be required in
respect of concurrent assignments to not more than five Approved Funds
managed by a single manager or advisor). Subject to acceptance and
recording thereof by the Administrative Agent pursuant to subsection
(c) of this Section, from and after the effective date specified in
each Assignment Agreement, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by
such Assignment Agreement, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment Agreement, be
released from its obligations under this Agreement (and, in the case of
an Assignment Agreement covering all of the assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of
Sections 3.7, 3.8 and 11.3 with respect to facts and circumstances
occurring or existing prior to the effective date of such assignment).
Upon request, the Borrower (at its expense) shall execute and deliver a
Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with
this subsection shall be treated for purposes of this Agreement as a
sale by such Lender of a participation in such rights and obligations
in accordance with subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this
purpose as an agent of the Borrower, shall maintain at the
Administrative Agent's Office a copy of each Assignment Agreement
delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amounts
of the Loans and Letter of Credit owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the
Register shall be conclusive, and the Borrower, the Administrative
Agent and the Lenders may treat each Person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any
Lender, at any reasonable time and from time to time upon reasonable
prior notice.
(d) Any Lender may at any time, without the consent of,
or notice to, the Borrower or the Administrative Agent, sell
participations to any Person (other than a natural person, Borrower or
any of Borrower's Affiliates or Subsidiaries) (each, a "Participant")
in all or a portion of such Lender's rights and/or obligations under
this Agreement (including all or a portion of its Commitment and/or
Loans (including such Lender's participations in Letters of Credit
and/or Swing Line Loans) owing to it));
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provided that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to
the other parties hereto for the performance of such obligations and
(iii) the Borrower, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells
such a participation shall provide that such Lender shall retain the
sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment,
waiver or other modification described in subsections (c) or (d) of
Section 11.2 that directly affects such Participant.
(e) A Participant shall not be a Lender hereunder for any
purpose except, if the participation agreement so provides, for the
purposes of Sections 3.7, 3.8 and 11.3 but only to the extent that the
cost of such benefits to the Borrower does not exceed the cost which
the Borrower would have incurred in respect of such Lender absent the
participation.
(f) Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this
Agreement (including under its Note, if any) to secure obligations of
such Lender, including any pledge or assignment to secure obligations
to a Federal Reserve Bank; provided that no such pledge or assignment
shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party
hereto.
(g) As used herein, the following terms have the
following meanings:
"Fund" means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions
of credit in the ordinary course of its business.
"Approved Fund" means any Fund that is administered or managed
by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity
or an Affiliate of an entity that administers or manages a
Lender.
(h) Notwithstanding anything to the contrary contained
herein, any Lender (a "Granting Lender") may grant to a special purpose
funding vehicle identified as such in writing from time to time by the
Granting Lender to the Administrative Agent and Borrower (an "SPC") the
option to provide all or any part of any Loan that such Granting Lender
would otherwise be obligated to make pursuant to this Agreement;
provided that (i) nothing herein shall constitute a commitment by any
SPC to fund any Loan, and (ii) if an SPC elects not to exercise such
option or otherwise fails to make all or any part of such Loan, the
Granting Lender shall be obligated to make such Loan pursuant to the
terms hereof. Each party hereto hereby agrees that (i) neither the
grant to any SPC nor the exercise by any SPC of such option shall
increase the costs or expenses or otherwise increase or change the
obligations of the Borrower under this Agreement (including their
obligations under Sections 3.7, 3.8 and 11.3), (ii) no SPC shall be
liable for any
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indemnity or similar payment obligation under this Agreement for which
a Lender would be liable, and (iii) the Granting Lender shall for all
purposes, including the approval of any amendment, waiver or other
modification of any provision of any Loan Document, remain the lender
of record hereunder. The making of a Loan by an SPC hereunder shall
utilize the Commitment of the Granting Lender to the same extent, and
as if, such Loan were made by such Granting Lender. In furtherance of
the foregoing, each party hereto hereby agrees (which agreement shall
survive the termination of this Agreement) that, prior to the date that
is one year and one day after the payment in full of all outstanding
commercial paper or other senior debt of any SPC, it will not institute
against, or join any other Person in instituting against, such SPC any
bankruptcy, reorganization, arrangement, insolvency, or liquidation
proceeding under the laws of the United States or any State thereof
with respect to matters directly related to this Agreement.
Notwithstanding anything to the contrary contained herein, any SPC may
(i) with notice to, but without prior consent of the Borrower and the
Administrative Agent, assign all or any portion of its right to receive
payment with respect to any Loan to the Granting Lender and (ii)
disclose on a confidential basis any non-public information relating to
its funding of Loans to any rating agency, commercial paper dealer or
provider of any surety or guarantee or credit or liquidity enhancement
to such SPC.
(i) Notwithstanding anything to the contrary contained
herein, any Lender that is a Fund may create a security interest in all
or any portion of the Loans owing to it and the Note, if any, held by
it to the trustee for holders of obligations owed, or securities
issued, by such Fund as security for such obligations or securities,
provided that unless and until such trustee actually becomes a Lender
in compliance with the other provisions of this Section 11.8, (i) no
such pledge shall release the pledging Lender from any of its
obligations under the Loan Documents and (ii) such trustee shall not be
entitled to exercise any of the rights of a Lender under the Loan
Documents even though such trustee may have acquired ownership rights
with respect to the pledged interest through foreclosure or otherwise.
(j) Notwithstanding anything to the contrary herein, the
rights of the Lenders to make assignment of, and grant participations
in, their Commitments shall be subject to the approval of any Gaming
Board, to the extent required by applicable Gaming Laws.
(k) Notwithstanding anything to the contrary contained
herein, if at any time Bank of America assigns all of its Commitments
and Loans pursuant to subsection (b) above, Bank of America may, (i)
upon 30 days' notice to the Borrower and the Lenders, resign as Issuing
Lender and/or (ii) upon 30 days' notice to the Borrower, resign as
Swing Line Lender. In the event of any such resignation as Issuing
Lender or Swing Line Lender, the Borrower shall be entitled to appoint
from among the Lenders a successor Issuing Lender or Swing Line Lender
hereunder; provided, however, that no failure by the Borrower to
appoint any such successor shall affect the resignation of Bank of
America as Issuing Lender or Swing Line Lender, as the case may be. If
Bank of America resigns as Issuing Lender, it shall retain all the
rights and obligations of the Issuing Lender hereunder with respect to
all Letters of Credit outstanding as of the effective date of its
resignation as Issuing Lender (including the right to require the
Lenders to fund risk participations in drawn Letters of Credit pursuant
to Section 2.4(c)).
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If Bank of America resigns as Swing Line Lender, it shall retain all
the rights of the Swing Line Lender provided for hereunder with respect
to Swing Line Loans made by it and outstanding as of the effective date
of such resignation, including the right to require the Lenders to make
Revolving Loans or fund risk participations in outstanding Swing Line
Loans pursuant to Section 2.5(c).
11.9 Right of Setoff. If an Event of Default has occurred and is
continuing, the Administrative Agent or any Lender (but in each case only with
the consent of the Requisite Lenders) may exercise its rights under Article 9 of
the Uniform Commercial Code and other applicable Laws and, to the extent
permitted by applicable Laws, apply any funds in any deposit account maintained
with it by the Borrower and any of its Property in its possession against the
Obligations.
11.10 Sharing of Setoffs. Each Lender severally agrees that if it,
through the exercise of any right of setoff, banker's lien or counterclaim
against the Borrower or otherwise, receives payment of the Obligations held by
it that is ratably more than any other Lender, through any means, receives in
payment of the Obligations held by that Lender, then, subject to applicable
Laws: (a) the Lender exercising the right of setoff, banker's lien or
counterclaim or otherwise receiving such payment shall purchase, and shall be
deemed to have simultaneously purchased, from the other Lender a participation
in the Obligations held by the other Lender and shall pay to the other Lender a
purchase price in an amount so that the share of the Obligations held by each
Lender after the exercise of the right of setoff, banker's lien or counterclaim
or receipt of payment shall be in the same proportion that existed prior to the
exercise of the right of setoff, banker's lien or counterclaim or receipt of
payment; and (b) such other adjustments and purchases of participations shall be
made from time to time as shall be equitable to ensure that all of the Lenders
share any payment obtained in respect of the Obligations ratably in accordance
with each Lender's share of the Obligations immediately prior to, and without
taking into account, the payment; provided that, if all or any portion of a
disproportionate payment obtained as a result of the exercise of the right of
setoff, banker's lien, counterclaim or otherwise is thereafter recovered from
the purchasing Lender by the Borrower or any Person claiming through or
succeeding to the rights of the Borrower, the purchase of a participation shall
be rescinded and the purchase price thereof shall be restored to the extent of
the recovery, but without interest. Each Lender that purchases a participation
in the Obligations pursuant to this Section shall from and after the purchase
have the right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased. The Borrower expressly consents
to the foregoing arrangements and agrees that any Lender holding a participation
in an Obligation so purchased may exercise any and all rights of setoff,
banker's lien or counterclaim with respect to the participation as fully as if
the Lender were the original owner of the Obligation purchased.
11.11 Nonliability of the Lenders. The Borrower acknowledges and
agrees that:
(a) Any inspections of any Property of the Borrower and
its Subsidiaries made by or through the Creditors are for purposes of
administration of the Loans and Letters of Credit only and the Borrower
and its Affiliates are not entitled to rely upon the
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same (whether or not such inspections are at the expense of the
Borrower or its Subsidiaries);
(b) By accepting or approving anything required to be
observed, performed, fulfilled or given to the Creditors pursuant to
the Loan Documents, neither the Administrative Agent nor the Lenders
shall be deemed to have warranted or represented the sufficiency,
legality, effectiveness or legal effect of the same, or of any term,
provision or condition thereof, and such acceptance or approval thereof
shall not constitute a warranty or representation to anyone with
respect thereto by the Creditors;
(c) The relationship between the Borrower and the
Creditors is, and shall at all times remain, solely that of borrower
and lenders; neither the Administrative Agent nor the Lenders shall
under any circumstance be construed to be partners or joint venturers
of the Borrower or its Affiliates; neither the Administrative Agent nor
the Lenders shall under any circumstance be deemed to be in a
relationship of confidence or trust or a fiduciary or other "special"
relationship with the Borrower or its Affiliates, or to owe any
fiduciary duty to the Borrower or its Affiliates; neither the
Administrative Agent nor the Lenders undertake or assume any
responsibility or duty to the Borrower or its Affiliates to select,
review, inspect, supervise, pass judgment upon or inform the Borrower
or its Affiliates of any matter in connection with their Property or
the operations of the Borrower or its Affiliates; the Borrower and its
Affiliates shall rely entirely upon their own judgment with respect to
such matters; and any review, inspection, supervision, exercise of
judgment or supply of information undertaken or assumed by the
Creditors in connection with such matters is solely for the protection
of the Creditors and neither the Borrower nor any other Person is
entitled to rely thereon; and
(d) The Creditors shall not be responsible or liable to
any Person for any loss, damage, liability or claim of any kind
relating to injury or death to Persons or damage to Property caused by
the actions, inaction or negligence of the Borrower and/or its
Affiliates and the Borrower hereby indemnifies and holds the Creditors
harmless on the terms set forth in Section 11.11 from any such loss,
damage, liability or claim.
11.12 No Third Parties Benefitted. This Agreement is made for the
purpose of defining and setting forth certain obligations, rights and duties of
the Borrower and the Creditors in connection with the Loans, and is made for the
sole benefit of the Borrower, the Creditors, and the Creditors' successors and
assigns. Except as provided in Sections 11.8 and 11.11, no other Person shall
have any rights of any nature hereunder or by reason hereof.
11.13 Confidentiality. Each Lender agrees to hold any confidential
information that it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure: (a) to other Lenders and Affiliates and
Approved Funds of such Lender, provided that each such Affiliate receiving such
information shall be bound by the provisions of this Section 11.14 as if it were
a Lender hereunder, and shall execute in favor of the Borrower such
documentation with respect thereto as the Borrower shall request in writing; (b)
to legal counsel and accountants for the Borrower or any Lender; (c) to other
professional advisors to the Borrower or any Lender, provided that the recipient
has accepted such information subject to a confidentiality agreement
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substantially similar to this Section; (d) to regulatory officials having
jurisdiction over that Lender; (e) to any Gaming Board having regulatory
jurisdiction over the Borrower or its Subsidiaries, provided that each Lender
agrees to use its best efforts to notify the Borrower of any such disclosure
unless prohibited by applicable Laws; (f) as required by Law or legal process or
in connection with any legal proceeding to which that Lender and the Borrower or
any of its Subsidiaries are adverse parties; (g) to another financial
institution in connection with a disposition or pledge or proposed disposition
or pledge to that financial institution of all or part of that Lender's
interests hereunder or a participation interest in its Note, provided that the
recipient has accepted such information subject to a confidentiality agreement
substantially similar to this Section; and (h) to any direct or indirect
contractual counterparty in swap agreements or such contractual counterparty's
professional advisor (so long as such contractual counterparty or professional
advisor to such contractual counterparty agrees to be bound by the provisions of
this Section). For purposes of the foregoing, "confidential information" shall
mean any information respecting the Borrower or its Subsidiaries reasonably
considered by the Borrower to be confidential, other than (i) information
previously filed with any Governmental Agency and available to the public, (ii)
information previously published in any public medium from a source other than,
directly or indirectly, that Lender, and (iii) information previously disclosed
by the Borrower or its Subsidiaries to any Person not associated with the
Borrower without a confidentiality agreement or obligation substantially similar
to this Section. Nothing in this Section shall be construed to create or give
rise to any fiduciary duty on the part of the Creditors to the Borrower or any
other Party.
11.14 Further Assurances. The Borrower and its Subsidiaries shall,
at their expense and without expense to the Lenders or the Administrative Agent,
do, execute and deliver such further acts and documents as the Requisite Lenders
or the Administrative Agent from time to time reasonably require for the
assuring and confirming unto the Lenders or the Administrative Agent of the
rights hereby created or intended now or hereafter so to be, or for carrying out
the intention or facilitating the performance of the terms of any Loan Document.
11.15 Integration. This Agreement, together with the other Loan
Documents and the letter agreements referred to in Sections 3.2, 3.4 and 3.5,
comprises the complete and integrated agreement of the parties on the subject
matter hereof and supersedes all prior agreements, written or oral, on the
subject matter hereof. In the event of any conflict between the provisions of
this Agreement and those of any other Loan Document, the provisions of this
Agreement shall control and govern; provided that the inclusion of supplemental
rights or remedies in favor of the Creditors in any other Loan Document shall
not be deemed a conflict with this Agreement. Each Loan Document was drafted
with the joint participation of the respective parties thereto and shall be
construed neither against nor in favor of any party, but rather in accordance
with the fair meaning thereof.
11.16 Governing Law. Except to the extent otherwise provided
therein, each Loan Document shall be governed by, and construed and enforced in
accordance with, the laws of New York.
11.17 Severability of Provisions. Any provision in any Loan Document
that is held to be inoperative, unenforceable or invalid as to any party or in
any jurisdiction shall, as to that party or jurisdiction, be inoperative,
unenforceable or invalid without affecting the remaining
90
provisions or the operation, enforceability or validity of that provision as to
any other party or in any other jurisdiction, and to this end the provisions of
all Loan Documents are declared to be severable.
11.18 Headings. Article and Section headings in this Agreement and
the other Loan Documents are included for convenience of reference only and are
not part of this Agreement or the other Loan Documents for any other purpose.
11.19 Time of the Essence. Time is of the essence of the Loan
Documents.
11.20 Foreign Lenders and Participants. Each Lender that is
incorporated or otherwise organized under the Laws of a jurisdiction other than
the United States of America or any State thereof or the District of Columbia
shall deliver to the Borrower (with a copy to the Administrative Agent), within
20 days after the Closing Date (or after accepting an assignment or receiving a
participation interest herein pursuant to Section 11.8, if applicable) two duly
completed copies, signed by a Responsible Official, of either Form W-8 or ▇-▇
▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Internal Revenue Service or such other evidence
(including, if reasonably necessary, Form W-9) satisfactory to the Borrower and
the Administrative Agent that no withholding under the federal income tax laws
is required with respect to such Lender. Thereafter and from time to time, each
such Lender shall upon request by the Borrower (a) promptly submit to the
Borrower (with a copy to the Administrative Agent), such additional duly
completed and signed copies of one of such forms (or such successor forms as
shall be adopted from time to time by the relevant United States taxing
authorities) as may then be available under then current United States laws and
regulations to avoid, or such evidence as is satisfactory to the Borrower and
the Administrative Agent of any available exemption from, United States
withholding taxes in respect of all payments to be made to such Lender by the
Borrower pursuant to this Agreement and (b) take such steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such Lender, and
as may be reasonably necessary (including the re-designation of its Euro-Dollar
Lending Office, if any) to avoid any requirement of applicable Laws that the
Borrower make any deduction or withholding for taxes from amounts payable to
such Lender. In the event that the Borrower or the Administrative Agent become
aware that a participation has been granted pursuant to Section 11.8(e) to a
financial institution that is incorporated or otherwise organized under the Laws
of a jurisdiction other than the United States of America, any State thereof or
the District of Columbia, then, upon request made by the Borrower or the
Administrative Agent to the Lender which granted such participation, such Lender
shall cause such participant financial institution to deliver the same documents
and information to the Borrower and the Administrative Agent as would be
required under this Section if such financial institution were a Lender.
11.21 Hazardous Material Indemnity. The Borrower hereby agrees to
indemnify, hold harmless and defend (by counsel reasonably satisfactory to the
Administrative Agent) the Administrative Agent and each of the Lenders (and any
successor to a Lender) and their respective directors, officers, employees and
agents from and against any and all claims, losses, damages, liabilities, fines,
penalties, charges, administrative and judicial proceedings and orders,
judgments, remedial action requirements, enforcement actions of any kind, and
all costs and expenses incurred in connection therewith (including reasonable
attorneys' fees and the reasonably allocated costs of attorneys employed by the
Administrative Agent or any Lender,
91
and expenses to the extent that the defense of any such action has not been
assumed by the Borrower), arising directly or indirectly out of (i) the presence
on, in, under or about any Real Property of any Hazardous Materials, or any
releases or discharges of any Hazardous Materials on, under or from any Real
Property and (ii) any activity carried on or undertaken on or off any Real
Property by the Borrower, its Subsidiaries or any of their predecessors in
title, whether prior to or during the term of this Agreement, and whether by the
Borrower, its Subsidiaries or any predecessor in title or any employees, agents,
contractors or subcontractors of the Borrower, its Subsidiaries or any
predecessor in title, or any third persons at any time occupying or present on
any Real Property (other than a Lender or a representative of a Lender), in
connection with the handling, treatment, removal, storage, decontamination,
clean-up, transport or disposal of any Hazardous Materials at any time located
or present on, in, under or about any Real Property. The foregoing indemnity
shall further apply to any residual contamination on, in, under or about any
Real Property, or affecting any natural resources, and to any contamination of
any Property or natural resources arising in connection with the generation,
use, handling, storage, transport or disposal of any such Hazardous Materials,
and irrespective of whether any of such activities were or will be undertaken in
accordance with applicable Laws, but the foregoing indemnity shall not apply to
Hazardous Materials on any Real Property, the presence of which is caused by the
Creditors. The Borrower hereby acknowledges and agrees that, notwithstanding any
other provision of this Agreement or any of the other Loan Documents to the
contrary, the obligations of the Borrower under this Section (and under Sections
4.19 and 5.11) shall be unlimited corporate obligations of the Borrower and
shall not be secured by any deed of trust or mortgage on any Real Property. Any
obligation or liability of the Borrower to any Indemnitee under this Section
shall survive the expiration or termination of this Agreement, the repayment of
all Loans, the expiration or termination of all Letters of Credit and the
payment and performance of all other Obligations owed to the Lenders.
11.22 Gaming Boards. The Administrative Agent and each of the
Lenders agree to cooperate with all Gaming Boards in connection with the
administration of their regulatory jurisdiction over the Borrower and its
Subsidiaries, including the provision of such documents or other information as
may be requested by any such Gaming Board relating to the Administrative Agent
or the Lenders, to the Borrower and its Subsidiaries, or to the Loan Documents.
11.23 Nevada Gaming Collateral. Subject to the release of any
Collateral as contemplated by any of the Loan Documents, the Administrative
Agent shall (or through one or more of its agents, sub-agents or sub-collateral
agents shall), to the extent required by Nevada Gaming Regulations, retain
possession of all pledged securities delivered to it consisting of capital stock
of any Nevada gaming licensee or registered intermediary company within the
State of Nevada at a location designated and approved by the applicable Gaming
Board.
11.24 Construction of the Pledge Agreements. To the extent that
Liens on any Collateral thereunder are granted to the Administrative Agent under
the Facilities Pledge Agreement, the Liens created by the Facilities Pledge
Agreement are hereby agreed to be equal, ratable and pari passu Liens to the
extent of the Liens granted under such Agreements. Without limiting the
generality of the preceding sentence, notwithstanding any other provision of the
Loan Documents to the contrary, the Facilities Pledge Agreement shall not be
construed to have granted a Lien in more than 65% of the equity securities of
any Subsidiary of the Borrower
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which is organized under the Laws of any jurisdiction other than the United
States and its political subdivisions.
11.25 CONSENT TO JURISDICTION; CHOICE OF FORUM.
(a) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF IN
THE ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ FOR THE SOUTHERN DISTRICT
OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. THE BORROWER HEREBY FURTHER IRREVOCABLY WAIVES ANY
CLAIM THAT ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER THE
BORROWER, AND AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENTS
BROUGHT IN ANY OF THE AFOREMENTIONED COURTS, THAT SUCH COURTS LACK
PERSONAL JURISDICTION OVER THE BORROWER. TO THE EXTENT PERMITTED BY
LAW, THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED
MAIL, POSTAGE PREPAID, TO THE BORROWER AT ITS ADDRESS SET FORTH
OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS
AFTER SUCH MAILING. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY
OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND
AGREES NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED
HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT THAT SERVICE OF PROCESS WAS
IN ANY WAY INVALID OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE
RIGHT OF THE ADMINISTRATIVE AGENT, ANY LENDER OR THE HOLDER OF ANY NOTE
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE
LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN ANY
OTHER JURISDICTION.
(b) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE
AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BROUGHT IN THE COURTS
REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY, TO THE
EXTENT PERMITTED BY APPLICABLE LAW, WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
93
11.26 Waiver of Right to Trial by Jury. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
11.27 Purported Oral Amendments. THE BORROWER EXPRESSLY ACKNOWLEDGES
THAT THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY ONLY BE AMENDED OR
MODIFIED, OR THE PROVISIONS HEREOF OR THEREOF WAIVED OR SUPPLEMENTED, BY AN
INSTRUMENT IN WRITING THAT COMPLIES WITH SECTION 11.2. THE BORROWER AGREES THAT
IT WILL NOT RELY ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL OR
WRITTEN STATEMENTS BY ANY REPRESENTATIVE OF THE ADMINISTRATIVE AGENT OR ANY BANK
THAT DOES NOT COMPLY WITH SECTION 11.2 TO EFFECT AN AMENDMENT, MODIFICATION,
WAIVER OR SUPPLEMENT TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
ALLIANCE GAMING CORPORATION, a Nevada
corporation
By:__________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chief Financial Officer
Address for Notices:
Alliance Gaming Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
95
BANK OF AMERICA, N.A., as Administrative
Agent
By:__________________________________________
Name:________________________________________
Title:_______________________________________
Address for Notices:
Bank of America, N.A.
Gaming and Leisure Industries Group
Portfolio Management - CA9-706-17-54
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC,
as Joint Lead Arranger and Joint Book Manager
By:__________________________________________
Name:________________________________________
Title:_______________________________________
97
CIBC WORLD MARKETS CORP.,
as Joint Lead Arranger and Joint Book Manager
By:__________________________________________
Name:________________________________________
Title:_______________________________________
98
BANK OF AMERICA, N.A., as a Lender
By:__________________________________________
Name:________________________________________
Title:_______________________________________
Address for Notices:
Bank of America, N.A.
Gaming and Leisure Industries Group
Portfolio Management - CA9-706-17-54
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇, Managing Director
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Bank of America, N.A.
Gaming and Leisure Industries Group
Client Management - CA9-706-17-54
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Managing Director
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
99
CIBC Inc.
By:__________________________________________
Name:________________________________________
Title:_______________________________________
100
▇▇▇▇▇ FARGO BANK, N.A.
By:__________________________________________
Name:________________________________________
Title:_______________________________________
101
GENERAL ELECTRIC CAPITAL CORPORATION
By:__________________________________________
Name:________________________________________
Title:_______________________________________
▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇
By:__________________________________________
Name:________________________________________
Title:_______________________________________
▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇ BRANCH
By:__________________________________________
Name:________________________________________
Title:_______________________________________
104
FLEET NATIONAL BANK
By:__________________________________________
Name:________________________________________
Title:_______________________________________
▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
By:__________________________________________
Name:________________________________________
Title:_______________________________________
106
▇▇▇▇▇▇▇ ▇▇▇▇▇ BANK, FSB
By:__________________________________________
Name:________________________________________
Title:_______________________________________
107
TRUSTMARK NATIONAL BANK
By:__________________________________________
Name:________________________________________
Title:_______________________________________
108
HIBERNIA NATIONAL BANK
By:__________________________________________
Name:________________________________________
Title:_______________________________________
109
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ PRIME INCOME TRUST
By:__________________________________________
Name:________________________________________
Title:_______________________________________
110