CASH COLLATERAL AND DISBURSEMENT AGREEMENT
Among
FIRST NATIONAL BANK OF COMMERCE, as Disbursement Agent
FIRST UNION BANK OF CONNECTICUT, as Trustee
and
CASINO MAGIC OF LOUISIANA, CORP.
dated as of
August 22, 1996
TABLE OF CONTENTS
Page
1. DEFINITIONS 2
1.1 DEFINED TERMS 2
1.2 INDEX OF ADDITIONAL DEFINED TERMS 9
2. ESTABLISHMENT OF ACCOUNTS 9
2.1 APPOINTMENT OF DISBURSEMENT AGENT 9
2.2 ESTABLISHMENT OF ACCOUNTS 9
2.3 PLEDGE AGREEMENT 10
2.4 INVESTMENT OF FUNDS IN ACCOUNTS 10
2.5 AGENCY 11
2.6 WAIVER OF SETOFF RIGHTS 11
3. DISBURSEMENT FROM ACCOUNTS 11
3.1 CONDITIONS To DISBURSEMENT 11
3.2 METHOD OF DISBURSEMENT 11
3.3 DISBURSEMENT OF COMPENSATION 12
3.4 TRANSFER OF FUNDS TO THE TRUSTEE 12
4. DUTIES OF DISBURSEMENT AGENT 12
4.1 DISBURSEMENT REQUESTS AND DISBURSEMENTS 12
4.2 PERIODIC REVIEW OF BOSSIER CITY PROJECT 14
4.3 LETTER OF AGREEMENT WITH INDEPENDENT CONSTRUCTION CONSULTANT 15
5. INTEREST RESERVE 15
5.1 INTEREST DISBURSEMENTS 15
5.2 INTEREST RESERVE ACCOUNT AMOUNTS 15
6. OPERATING RESERVE 15
6.1 CONDITIONS PRECEDENT TO OPERATING RESERVE DISBURSEMENTS 15
6.2 FINAL DISBURSEMENT OF FUNDS 16
7. COMPLETION RESERVE 16
7.1 CONDITIONS PRECEDENT TO COMPLETION RESERVE DISBURSEMENTS 16
7.2 FINAL DISBURSEMENT OF FUNDS 16
8. CONDITIONS PRECEDENT TO DISBURSEMENT FROM CONSTRUCTION DISBURSEMENT
ACCOUNT...................................................................
17
8.1 INITIAL DISBURSEMENTS 17
8.2 CONDITIONS To DISBURSEMENTS 17
8.3 ADVANCE DISBURSEMENTS 18
8.4 DISBURSEMENTS AFTER EVENT OF DEFAULT 18
8.5 FINAL DISBURSEMENT OF FUNDS FOLLOWING OPERATING DATE 19
9. AMENDMENTS TO CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT TO
CONTRACTS .................................................................
19
9.1 CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT
PROCESS............................. 19
9.2 CONTRACT AMENDMENT PROCESS................................................
. 20
9.3 PROJECT COST SCHEDULE AND COST
OVERRUNS........................................
20
10. ESCROW ACCOUNT 21
10.1 DEPOSIT OF PROCEEDS INTO ESCROW ACCOUNT 21
10.2 CONDITIONS PRECEDENT To ESCROW ACCOUNT DISBURSEMENT 21
10.3 DISBURSEMENT IN THE EVENT RIVERBOAT GAMING is DISCONTINUED 21
11. EVENTS OF ▇▇▇▇▇▇▇ ▇▇
▇▇. DISBURSED FUNDS ACCOUNTS 22
12.1 RIGHTS OF THE COMPANY To DISBURSED FUNDS ACCOUNTS 22
12.2 RIGHT TO SUBSTITUTE DISBURSED FUNDS ACCOUNT 22
13. LIMITATION OF LIABILITY 22
13.1 DISBUSEMENT AGENT'S LIMITATION OF LIABILITY 22
13.2 DISBURSEMENT AGENTS LIMITATION OF LIABILITY 23
14. INDEMNITY AND INSURANCE 23
14.1 INDEMNITY OF DISBURSEMENT AGENT 23
14.2 INSURANCE 24
15. TERMINATION 24
16. SUBSTITUTION OF DISBURSEMENT AGENT OR RESIGNATION 24
17. ACCOUNT STATEMENT 25
18. NOTICE 25
19. MISCELLANEOUS 25
19.1 WAIVER 25
19.2 INVALIDITY 25
19.3 No AUTHORITY 26
19.4 ASSIGNMENT 26
19.5 BENEFIT 26
19.6 TIME 26
19.7 CHOICE OF LAW 26
19.8 ENTIRE AGREEMENT: AMENDMENTS 26
19.9 NOTICES 26
19.10 COUNTERPARTS 27
19.11 CAPTIONS 27
19.12 ARBITRATION 27
ii
CASH COLLATERAL AND DISBURSEMENT AGREEMENT
THIS CASH COLLATERAL AND DISBURSEMENT AGREEMENT (the "AGREEMENT") is
dated as of August 22, 1996, by and among FIRST NATIONAL BANK OF COMMERCE, a
national banking association, as Disbursement Agent (the "DISBURSEMENT
AGENT"), FIRST UNION BANK OF CONNECTICUT, a Connecticut banking corporation,
as trustee under the Indenture (as defined below) (the "TRUSTEE") and CASINO
MAGIC OF LOUISIANA, CORP., a Louisiana corporation ("COMPANY").
RECITALS
A. NOTES. The Company has issued One-Hundred Fifteen Million
Dollars ($115,000,000) in aggregate principal amount of its First Mortgage
Notes due 2003 With Contingent Interest (the "SERIES A NOTES" and, together
with any Series B Notes issued in exchange therefore, the "NOTES")
concurrently herewith. The Company's obligations under the Notes will be
unconditionally guaranteed by Jefferson Casino Corporation (the "GUARANTOR")
pursuant to a guarantee (the "GUARANTEE"). The Notes will be issued pursuant
to the provisions of an indenture (the "INDENTURE") dated as of August 22,
1996, among the Company, the Guarantor and the Trustee. Proceeds from the
issuance of Notes in the amount of Twenty-Nine Million Six Hundred Seventy
Eight Thousand Three Hundred Ninety Six Dollars and Fourteen Cents
($29,678,396.14) (the "CONSTRUCTION PROCEEDS") will be deposited
contemporaneously with the execution of this Agreement into account #1 101787,
held at First National Bank of Commerce (said account, or any substitute
account selected in accordance with the terms of this Agreement is sometimes
referred to herein as the "CONSTRUCTION DISBURSEMENT ACCOUNT") to be
maintained by the Disbursement Agent pursuant to Section 2 of this Agreement.
Proceeds from the issuance of Notes in the amount of Seven Million Two-Hundred
Eighty-Eight Thousand One Hundred Twenty Five Dollars ($7,288,125) (the
"INTEREST RESERVE PROCEEDS") will be deposited contemporaneously with the
execution of this Agreement into account #▇▇▇▇▇▇▇-1, held at First National
Bank of Commerce (said account, or any substitute account selected in
accordance with the terms of this Agreement is sometimes referred to herein as
the "INTEREST RESERVE ACCOUNT") to be maintained by the Disbursement Agent
pursuant to Section 2 of this Agreement. Proceeds from the issuance of Notes
in the amount of Five Million Dollars ($5,000,000) (the "COMPLETION RESERVE
PROCEEDS") will be deposited contemporaneously with the execution of this
Agreement into account #1 101787-2, held at First National Bank of Commerce
(said account, or any substitute account selected in accordance with the terms
of this Agreement is sometimes referred to herein as the "COMPLETION RESERVE
ACCOUNT") to be maintained by the Disbursement Agent pursuant to SECTION 2
of this Agreement. Proceeds from the issuance of Notes in the amount of Three
Million Two-Hundred Eleven Thousand Fifty Dollars and Eighteen Cents
($3,211,050.18) (the "OPERATING RESERVE PROCEEDS") (the Construction Proceeds,
the Completion Reserve, the Interest Reserve Proceeds and the Operating
Reserve Proceeds are collectively referred to herein as the "PROCEEDS") will
be deposited contemporaneously with the execution of this Agreement into
account #▇▇▇▇▇▇▇-3, held at First National Bank of Commerce (said account, or
any substitute account selected in accordance with the terms of this Agreement
is sometimes referred to herein as the "OPERATING RESERVE ACCOUNT") to be
maintained by the Disbursement Agent pursuant to SECTION 2 of this
Agreement.
B. COLLATERAL AND COLLATERAL ▇▇▇▇▇▇▇▇▇▇.▇▇ security for its
obligations under the Notes and the Indenture, the Company has granted
security interests to the Trustee, on behalf of the holders of Notes, in
certain assets and has collaterally assigned certain contracts to the Trustee.
As further security for its obligations under the Notes and the Indenture,
the Company also has granted a security interest to the Trustee, on behalf of
the holders of the Notes, in all of its right, title and interest in the
Construction Disbursement Account, the Disbursed Funds Accounts (as defined
herein), the Completion Reserve Account, the Interest Reserve Account, the
Operating Reserve Account and any Proceeds or other amounts held in any such
account.
C. PURPOSE.The parties intend that portions of the Proceeds be used
to construct the Bossier City Project (as defined herein). The parties have
entered into this Agreement in order to set forth the conditions upon which,
and the manner in which, funds will be disbursed from the Construction
Disbursement Account in order to permit the Company to construct the Bossier
City Project, including the furnishing, fixturing and equipping thereof, the
purchasing of gaming equipment necessary to operate the casino located in the
Bossier City Project and the payment of Pre-Opening Expenses in accordance
with this Agreement.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Definitions
1.1 Defined Terms. In this Agreement, the terms defined in this
SECTION 1 shall have the meanings herein specified, such definitions to be
equally applicable to both the singular and plural forms of any of the terms
defined:
"ACCOUNTS" means the Interest Reserve Account, the Operating Reserve Account,
the Completion Reserve Account, the Construction Disbursement Account, the
Disbursed Funds Account and the Escrow Account.
"ADDITIONAL REVENUE" means revenue (including without limitation
investment income accruing on the Construction Disbursement Account or the
Disbursed Funds Account) generated by the Company, other than from disposition
of their respective assets, but only to the extent that such revenue is held
by the Company, free and clear of any claims of any other parties whatsoever,
other than the Trustee and holders of the Notes; provided, however, that as of
any date of measurement, Additional Revenue also shall include investment
income which the Company reasonably determines will accrue on funds in the
Construction Disbursement Account through the date that the Bossier City
Project becomes Operating.
"ADVANCE DISBURSEMENTS" means a disbursement from the Construction
Disbursement Account to the Company as an advance against payments for Soft
Costs, including and for the payment of deposits for the purchase of equipment
for the Bossier City Project which the Company anticipates making in
accordance with the Construction Disbursement Budget; provided that Advance
Disbursements shall not be outstanding in an amount greater than $250,000 at
anytime.
"AVAILABLE FUNDS" means, at any given time, (a) the Proceeds deposited in
the
2
Construction Disbursement Account, less disbursements theretofore made from
the Construction Disbursement Account, (b) Additional Revenue, and (c)
Realized Savings theretofore achieved.
"BELLOWS" means ▇.▇. ▇▇▇▇▇▇▇ Construction Corporation and its successors
identified by notice to the Disbursement Agent.
"BELLOWS CONSTRUCTION CONTRACT" means the contract for the construction
of the Bossier City Project executed by Bellows and the Company, dated June
12, 1996; provided that the Company shall use its best efforts to amend such
contract to provide that the Bossier City Project shall be Operating by a date
certain and constructed for a guaranteed maximum price.
"BORROWERS CLOSING CERTIFICATION" means an Officer's Certificate in the
form attached hereto as EXHIBIT B-1.
"BOSSIER CITY PROJECT" means the pending project to develop, construct,
equip and open the Casino Magic-Bossier City dockside riverboat casino, which
will be located on (or in the case of the riverboat, adjacent to) the
Property, and which will consist of, among other things, (i) a recently
constructed riverboat which measures 254 feet long and 78 feet wide, and
contains approximately fifty-eight thousand (58,000) square feet of interior
space, including thirty-thousand (30,000) square feet of gaming space with
approximately one-thousand (1,000) slot machines and 50 table games; provided
that funds disbursed under this Agreement shall not be used to purchase or
improve such riverboat, except such improvements as are set forth in the
Initial Construction Disbursement Budget, (ii) a thirty-seven thousand
(37,000) square foot entertainment pavilion, and related amenities (including
a 350-seat buffet restaurant, a gift shop, a bar and lounge area and a stage
area designed to showcase live entertainment, including dance productions,
bands and individual performers with an open seating area that will
accommodate up to 300 people) and (iii) covered parking for one-thousand
five-hundred fifty thousand (1,550) cars, and any future developments or
improvements in connection therewith.
"BELLOWS HARD COSTS" means all Hard Costs related to the Bossier City
Project other than costs relating to the supplying of goods, materials and
labor pursuant to the terms of the ▇▇▇ ▇▇▇▇▇ Construction Contract.
"BOSSIER RIVERBOAT" means that certain riverboat gaming vessel "Mary's
Prize" Official No. 1028011 purchased by the Company from ▇▇▇▇ Gaming
Corporation pursuant to that certain Buy-Sell Agreement dated August 2, 1996.
"CASH EQUIVALENTS" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than six months from the date of acquisition, (iii) certificates of
deposit and eurodollar time deposits with maturities of six months or less
from the date of acquisition, bankers' acceptances with maturities not
exceeding six months and overnight bank deposits, in each case with any
domestic commercial bank having capital and surplus in excess of $500 million
and a ▇▇▇▇▇ Bank Watch Rating of "B" or better, (iv) repurchase obligations
with a term of not more than seven days for underlying securities of the types
described in clauses (ii) and (iii) above entered into with any financial
institution meeting the qualifications specified in clause (iii) above, (v)
commercial paper having
one of the two highest ratings obtainable from ▇▇▇▇▇'▇ Investors Service, Inc.
or Standard & Poor's Ratings Group and in each case maturing within six months
after the date of acquisition, and (vi) investment funds investing solely in
securities of the types described in clauses (ii), (iii), (iv) or (v) above.
"COMPLETION" means, with respect to the Bossier City Project, completion
of all construction pursuant to the Plans in a manner which permits the
Bossier City Project to be Operating.
"C.F.R." means Code of Federal Regulations.
"CONSOLIDATED CASH FLOW" has the meaning set forth in the Indenture.
"CONSTRUCTION DISBURSEMENT BUDGET" means the Initial Construction
Disbursement
Budget, as the same may be amended from time to time pursuant to this
Agreement.
"CONSTRUCTION CONTRACT" means the Bellows Construction Contract and the
▇▇▇ ▇▇▇▇▇ Construction Contract.
"CONSTRUCTION EXPENSES" means expenses incurred in connection with the
construction of the Bossier City Project in accordance with the Construction
Disbursement Budget, excluding, however, (a) any such Construction Expenses
paid prior to the Issue Date, (b) any Debt Financing Costs and (c) any
Issuance Fees and Expenses.
"CONSTRUCTION SCHEDULES" mean, collectively, schedules describing the
sequencing of the components of work to be undertaken in connection with the
Bossier City Project, which schedules (as the same may be amended) demonstrate
that the Bossier City Project will be Operating on or before its Operating
Deadline.
"CONTRACT" means a contract pertaining to the construction of the Bossier
City Project to which the Company is a party, including without limitation any
contract, license and performance and payment bond or guarantee, if any.
"CONTRACTOR" means a contractor which is a party to a Contract.
"CRESCENT CITY RIVERBOAT" means the riverboat gaming vessel "Crescent
City Queen," Official Number 1028319, measuring approximately 430 feet by 100
feet with a total area of approximately 88,000 square feet spread across three
decks, owned by the Company on the Issue Date.
"DEBT FINANCING COSTS" means all principal, repayments, interest and
other amounts payable or accrued from time to time under the Notes.
"DEFAULT" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default (as such term is defined
in the Indenture).
"GOVERNMENT SECURITIES" means direct obligations of, or obligations
guaranteed by,
4
the United States of America for the payment of which guarantee or obligations
the full faith and credit of the United States is pledged.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or like account
maintained with a bank, savings and loan association, credit union, or like
organization, including an account evidenced by a writing (other than an
account evidenced by a certificate of deposit as defined in Louisiana Revised
Statutes 10:3-104).
"DISBURSED FUNDS ACCOUNT" means the Disbursed Funds Account, account
number 110649060 at First National Bank of Commerce, New Orleans, Louisiana,
in the name of the Company or any substitute account selected in accordance
with this Agreement, which account shall be funded from disbursements from the
Construction Disbursement Account and/or the Operating Revenue Account.
"DISBURSEMENT REQUEST" means any Initial Disbursement Request,
Construction Disbursement Request, Operating Disbursement Request, Completion
Reserve Disbursement Request, Interest Disbursement Request, Escrow
Disbursement Request and any other request for disbursement from the Accounts
made pursuant to this Agreement.
"ESCROW ACCOUNT" means that certain account to be held at First National
Bank of Commerce into which any proceeds from the sale of the Crescent City
Riverboat, if any, will be deposited, if required pursuant to SECTION 10.
"FEDERAL BOOK-ENTRY SECURITY" means any of the following: a Book-Entry
Federal Home Loan Mortgage Corporation Security as such term is defined in I
C.F.R. 462.1(c), a Book-Entry FmHA Security as such term is defined in 7
C.F.R. 1901.503(b)(4), a Book-Entry Farm Credit Security as such term is
defined in 12 C.F.R. 615.5460(e), a Book-Entry Financial Assistance Security
as referenced in 12 C.F.R. 615.5560(c), a Book-Entry Federal Housing Finance
Security as such term is defined in 12 C.F.R. 912.1(d), a Book-Entry
Financing Corporation Security as referenced in 12 C.F.R. 950.5(b), a
Book-Entry Funding Corporation Security as such term is defined in 12 C.F.R.
151 1. 1, a Book-Entry TVA Power Security as such term is defined in 18 C.F.R.
1314.2(f), a Book-Entry FNMA Security as such term is defined in 24 C.F.R.
81.41(d), a Book-Entry Treasury Security as such ten-n is defined in 31 C.F.R.
306.115(d), a Book-Entry ▇▇▇▇▇▇ Mae Security as such term is defined in 31
C.F.R. 354.1(e) or a Book-entry Postal Service Security as such term is
defined in 39 C.F.R. 761.2(d).
"FEDERAL RESERVE BANK" means a "Reserve Bank" as such ten-n is defined in
the C.F.R. Title 1, Section 462.1(a), Title 7, Section 1901.503(b)(1), Title
12, Sections 615.5460(a), 912.1(a), and 1511.1, title 18, section 1314.2(b),
Title 24, Section 81.41(a), Title 31, Sections 306.115(a) and 354.1(a) and
Title 39, Section 761.1(a), located within Louisiana.
"FINAL PLANS" with respect to any particular work or improvement means
Plans which (i) have received final approval from all governmental authorities
required to approve such Plans prior to completion of the work or
improvements; and (ii) contain sufficient specificity to permit the completion
of the work or improvement.
"GENERAL CONTRACTOR" means Bellows and/or ▇▇▇ ▇▇▇▇▇.
"HARD COSTS" means the costs and expenses in respect of supplying goods,
materials and labor for the construction of improvements relating to the
Bossier City Project.
"INDEPENDENT CONSTRUCTION CONSULTANT" means 2nd Opinion, Inc., a
Louisiana corporation, (provided that 2nd Opinion, Inc. has agreed to perform
the duties of the Independent Construction Consultant hereunder for the
benefit of the Company, the Trustee and the holders of the Notes pursuant to
that certain side letter dated as of the date hereof in favor of the Company
and the Trustee) and its successors or any substitute Independent Construction
Consultant appointed by the Company in accordance with the terms of this
Agreement.
"INITIAL CONSTRUCTION DISBURSEMENT BUDGET" means, collectively, the
itemized schedule setting forth on a line item basis all of the costs which
the Company anticipates to expend in connection with the development,
construction, equipping and opening of the Bossier City Project attached as
EXHIBIT 1to the Borrowers' Closing Certification which costs in the
aggregate, to the extent they are anticipated to be funded from the Accounts,
shall not exceed the Construction Proceeds.
"INITIAL DISBURSEMENTS CERTIFICATE" means an Officers' Certificate from
the Company in the form attached hereto as EXHIBIT A.
"ISSUE DATE" means the date of the closing of the offering of the Notes.
"ISSUANCE FEES AND EXPENSES" means fees and expenses (a) incurred by the
Company
in connection with the offering of the Notes and (b) incurred on or before the
Issue Date.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease
in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"LOUISIANA REFERENDUM" means the local option elections scheduled to be
held on November 5, 1996 on a parish-by-parish basis in the State of Louisiana
to determine whether to continue to permit existing forms of gaming authorized
by law to be conducted in each such parish.
"MARQUIS FUND" means the Treasury Securities Money Market Fund maintained
by
Marquis Funds, a Massachusetts business trust.
"▇▇▇ ▇▇▇▇▇" means ▇▇▇ ▇▇▇▇▇ Construction Company and its successors
identified
by notice to the Disbursement Agent.
"▇▇▇ ▇▇▇▇▇ CONSTRUCTION CONTRACT" means the Contract for Fill and
Compaction
Work executed by ▇▇▇ ▇▇▇▇▇ and the Company dated June 12, 1996; provided that
the
6
Company shall use its best efforts to amend such contract to provide that the
Bossier City Project shall be Operating by a date certain and constructed for
a guaranteed maximum price
"▇▇▇ ▇▇▇▇▇ HARD COSTS" means all Hard Costs in connection with the Bossier
City Project relating to the supplying of goods, materials and labor pursuant
to the ▇▇▇ ▇▇▇▇▇ Construction Contract.
"MORTGAGE" means the Mortgage and Assignment of Leases and Rents executed by
the Company to encumber its interests in the Property in favor of the Trustee,
on behalf of the holders of Notes.
"OFFICER" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice President of such Person.
"OPERATING" means, with respect to the Bossier City Project, the time
that (i) all Gaming Licenses (as such term is defined in the Indenture) have
been granted and have not been revoked or suspended, (ii) all Liens (other
than the Liens created by the Collateral Documents (as such ten-n is defined
in the Indenture) or Permitted Liens (as such term is defined in the
Indenture) related to the construction of the Bossier City Project have been
paid or, if payment is not yet due or if such payment is contested in good
faith by the Company, sufficient fiends remain in the Construction
Disbursement Account to discharge such Liens or such Liens have been bonded
with bonds in form and substance sufficient to satisfy such Liens, (iii)
Bellows, ▇▇▇ ▇▇▇▇▇, the Project Architect and the Independent Construction
Consultant of the Bossier City Project shall have delivered a certificate to
the Trustee certifying that the Bossier City Project is complete in accordance
with the plans therefor and all applicable building laws, ordinances and
regulations, (iv) the Bossier City Project is in a condition (including
installation of furnishings, fixtures and equipment) to receive guests in the
ordinary course of business, (v) gaming and other operations in accordance
with applicable law are open to the general public and are being conducted at
the Bossier City Project, (vi) a permanent or temporary certificate of
occupancy has been issued for the Bossier City Project by the parish in
Louisiana in which the Bossier City Project will operate, (vii) a notice of
completion of the Bossier City Project has been duly recorded, and (viii) the
Bossier Riverboat has been documented by the U.S. Coast Guard in the name of
the Company and the U.S. Coast Guard has issued a final Certificate of
Inspection for the Bossier Riverboat.
"OPERATING DEADLINE" means April 30, 1997.
"PERSON" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"OFFICERS' CERTIFICATE" means a certificate signed by two officers of the
company on whose behalf or for whose benefit the certificate is being executed
or delivered, in either case including one of the following officers of such
company: the Chairman of the Board, Chief Executive Officer, President, Chief
Financial Officer, Vice President Finance, Treasurer or Assistant Treasurer.
"PLANS" means the plans, specifications, working drawings, change orders,
correspondence and related items, which may be amended by the Company, as the
case may be, as necessary or appropriate, that collectively: (a) provide for
and detail the manner of construction of improvements for the Bossier City
Project; (b) call for construction which will permit the Bossier City Project
to be Operating on or prior to its Operating Deadlines; (c) call for
construction which will cause the Bossier City Project to be Operating for a
total cost consistent with its Construction Disbursement Budget and the line
items set forth therein; and (d) to the extent such Plans are amended such
Plans continue to represent a logical evolution consistent with previous Plans
and are consistent with the description of the Bossier City Project contained
herein, and are consistent with all governmental approvals and requirements,
including without limitation, the Bossier City Building Department.
"PLEDGE AGREEMENT" means that certain Accounts Pledge Agreement between
the Company and the Trustee relating to the Trustee's security interest in the
Accounts and the proceeds thereof.
"PROJECT ARCHITECT" means ▇▇▇▇▇▇▇▇ design Group, Inc. and its successors
identified by notice to the Disbursement Agent.
"PROJECT COST SCHEDULE" means an itemized schedule in the form of
SCHEDULE 1 to the Disbursement Request.
"PROPERTY" means an approximately 23-acre site along the Red River in
Bossier City, Louisiana on which the Company will construct the Bossier City
Project.
"REALIZED SAVINGS" means the excess of the amount budgeted in the
Construction Disbursement Budget for a line item over the amount of funds
expended or owed by the Company to complete the tasks set forth in such line
item and for the materials and services used to complete such tasks; provided,
however, that: (a) Realized Savings for any line item shall be deemed to be
zero if such savings are obtained in a manner that materially detracts from
the overall quality and amenities of the Bossier City Project and (b) Realized
Savings for each line item shall in all cases be deemed to be zero until (i)
the Company has completed all work and improvements covered by the line item,
or (ii) the Company has satisfied or provided in all material respects for the
obligations arising out of the completion of that line item.
"REMAINING COSTS" means, at any given time, the amount necessary to pay,
through the time the Bossier City Project is Operating, all theretofore unpaid
costs (including Retainage Amounts) to be incurred or payable in connection
with the Bossier City Project through the date on which the Bossier City
Project is Operating.
"RETAINAGE AMOUNTS" means at any given time amounts which have accrued
and are owing under the terms of a Contract for work or services already
provided but which at such time (and in accordance with the terms of the
Contract) are being withheld from payment to the Contractor until certain
subsequent events (e.g., completion benchmarks) have been achieved under the
Contract.
"SOFT COSTS" means all costs set forth in the Construction Disbursement
Budget other than Hard Costs, including, without limitation, pre-opening
costs.
"TITLE INSURER" means Louisiana Title Company.
"TITLE POLICY" means the lender's policy or policies of title insurance
to be provided by the Title Insurer to the Trustee with respect to the
Property, as the case may be, together with all endorsements thereto in the
form attached as EXHIBIT M.
1.2 Index of Additional Defined Terms. In addition, the terms
listed in the left column below shall have the respective meanings assigned to
such terms in the Section of this Agreement listed opposite such terms in the
right column below:
Defined Term Section
AGREEMENT Introduction
COMPANY Introduction
COMPLETION RESERVE ACCOUNT A of Recitals
COMPLETION RESERVE DISBURSEMENT REQUEST 4.1
COMPLETION RESERVE PROCEEDS A of Recitals
CONSTRUCTION DISBURSEMENT ACCOUNT A of Recitals
CONSTRUCTION DISBURSEMENT REQUEST 4.1
CONSTRUCTION PROCEEDS A of Recitals
DISBURSEMENT AGENT Introduction
ESCROW DISBURSEMENT REQUEST 4.1
EVENT OF DEFAULT 10
FINAL DISBURSEMENT 8.1
GUARANTOR A of Recitals
INDENTURE A of Recitals
INITIAL DISBURSEMENTS 8.1
INITIAL DISBURSEMENTS CERTIFICATE 4.1
INTEREST DISBURSEMENT REQUEST 4.1
INTEREST RESERVE ACCOUNT A of Recitals
INTEREST RESERVE PROCEEDS A of Recitals
OPERATING RESERVE PROCEEDS A of Recitals
PLEDGED SECURITIES 2.2
PROCEEDS A of Recitals
TRUSTEE Introduction
2. Establishment of Accounts.
2.1 Appointment of Disbursement Agent. Trustee and the Company
hereby appoint Disbursement Agent, and Disbursement Agent hereby accepts
appointment, as disbursement agent under the terms and conditions of this
Agreement.
2.2 Establishment of Accounts. Concurrently with the execution and
delivery hereof, Disbursement Agent shall establish the Accounts at
Disbursement Agent and credit thereto, in
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accordance with the provisions of RECITALA hereof, the Proceeds. All funds
in the Accounts shall be held in trust and not commingled with any ordinary
deposit or commercial bank account. The Disbursement Agent hereby waives any
and all liens, claims, encumbrances and rights of set off which it may have in
the Accounts including all rights of offset, deductions and liens, whether
statutory or otherwise afforded by law, agreement or otherwise set forth
herein. All funds accepted by Disbursement Agent pursuant to this Agreement
shall be held in the appropriate Account for the benefit of the Company
subject to the terms and conditions of this Agreement and the Pledge Agreement
(including without limitation the rights of the Trustee hereunder and
thereunder). Disbursement Agent may, upon the request of Company, establish
sub-accounts for accounting purposes within the Accounts, it being understood
and agreed that the creation of such sub-accounts shall in no way affect the
pledge of the Trustee in the accounts hereunder.
2.3 Pledge Agreement. Pursuant to the Pledge Agreement, the
Company has granted to the Trustee, for the benefit of the Noteholders, a
first priority security interest in the Accounts and all funds and assets from
time to time deposited therein, and all products and proceeds thereof. The
Disbursement Agent shall note in its records that all funds and other assets
in the Accounts have been pledged to the Trustee and that the Disbursement
Agent is holding such items as agent for the Trustee, as secured party. The
Disbursement Agent shall maintain dominion and control of the Accounts and the
funds and assets therein solely for the benefit of the Trustee, as secured
party, and for no other parties or Persons (it being understood that the
foregoing shall not be construed as limiting the rights of the Company to
obtain disbursements in accordance with the terms hereof). Accordingly, it is
the intention of the parties that all such funds and assets shall not be
within the bankruptcy "estate" (as such term is used in II U.S.C. 54 1) of
the Disbursement Agent. All such funds and all earnings accruing from time to
time thereon shall be held in the applicable Account until disbursed in
accordance with the terms hereof or until transferred to such other Account as
Trustee and the Company may direct Disbursement Agent to establish.
2.4 Investment of Funds in Accounts. All funds from time to time
credited to the Accounts shall be invested as follows:
2.4.1 Construction Disbursement Account, Completion Reserve
Account, Operating Reserve Account and Escrow Account. All funds contained
in the Construction Disbursement Account, the Completion Reserve Account, the
Operating Reserve Account and the Escrow Account shall be invested in only the
following (in such amounts as may be directed by the Company from time to time
by written instructions delivered to the Disbursement Agent) pending
disbursement from such Accounts pursuant to this Agreement:
(a) Federal Book-Entry Securities (i) which have been transferred to
the Disbursement Agent and identified as within a book-entry account
maintained by the Disbursement Agent with a Federal Reserve Bank, and (ii)
with respect to which, other than the interests of the Company as owner and
the Trustee as secured party, the Disbursement Agent is not aware of and does
not have any notice of any other interest or adverse claim.
(b) Deposit Accounts maintained in the name of the Company with the
Disbursement Agent, provided that from and after the third business day
following the initial issuance of the Notes, the maximum amount of funds
maintained in such deposit accounts at any given time shall not exceed
Two-Hundred Thousand Dollars ($200,000).
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(c) The Marquis Fund, but only to the extent that, with respect to
such investment, (i) the Company has executed a letter substantially in the
form of EXHIBIT L attached hereto addressed in the manner set forth therein,
the Disbursement Agent has delivered such letter to the addressee thereof and
each party listed as receiving a copy thereof, and the Disbursement Agent has
received from the addressee thereof a copy of said letter counter-signed by
said addressee, and (ii) other than the interests of the Company as owner and
the Trustee as secured party, the Disbursement Agent is not aware of and does
not have any notice of any other interest or adverse claim.
(d) Any other Cash Equivalents, but only to the extent that the
Disbursement Agent shall have concluded that appropriate steps shall have been
taken with respect to such investment so as to assure the continuing
perfection of the Trustee's first priority security interest in such
investment. For purposes of determining the steps to be taken in order to
achieve and maintain such perfection, the Disbursement Agent shall have the
right to require the delivery of, and to rely upon, an opinion of counsel to
the Company or the Disbursement Agent (the expense of which shall be paid by
the Company) specifying (A) that the counsel is familiar with the laws
applicable to the perfection of security interests in said investments and (B)
the steps required to perfect and maintain a first priority security interest
in favor of the Trustee in such investments.
If no such instructions are received by the Disbursement Agent after
request, such funds shall be invested in securities selected by the
Disbursement Agent of the type described in CLAUSE (A)above having
maturities of not more than six months from the date of acquisition.
2.4.2 Interest Reserve Account. All funds in the Interest Reserve
Account shall be invested only in securities selected by the Company of the
type described in SECTION 2.4.1(A)above having maturities of not more than
six months from the date of acquisition. If the Company at any time fails to
provide appropriate instructions to the Disbursement Agent as to the
particular securities to be acquired, then the particular securities to be
acquired shall be selected by the Disbursement Agent.
2.5 Agency. The Disbursement Agent shall act solely as the
Trustee's agent in connection with its duties under this SECTION
2,notwithstanding any other provision contained in this Agreement, without
any authority to obligate the Trustee or to compromise or pledge its security
interest hereunder. The Company acknowledges and agrees that in no event
shall the Trustee or the holders of the Notes, be liable for, nor shall the
obligations of the Company under the Indenture and the Notes be affected or
diminished as a consequence of, any action or inaction of the Disbursement
Agent with respect to the Accounts or any funds or other assets credited
thereto or deposited herein.
2.6 Waiver of Setoff Rights. The Disbursement Agent hereby
acknowledges the Trustee's security interest as set forth above and waives any
security interest or other lien in the Accounts or any funds or other assets
credited thereto or deposited herein and further waives any right to set off
said funds, assets or investments now or in the future against any
indebtedness of the Company to the Disbursement Agent. The waivers set forth
in this SECTION 2.6 are of rights which may exist now or hereafter in favor
of the Disbursement Agent in its individual capacity, and not of any such
rights which may exist now or hereafter in favor of the Disbursement Agent in
its capacity as agent for the Trustee. Nothing in this SECTION 2.6 shall be
construed as waiving, limiting or diminishing any rights of the Trustee
vis-a-vis the Company.
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3. Disbursements from Accounts.
3.1 Conditions to Disbursement. The Disbursement Agent shall disburse
funds from the Accounts only upon satisfaction of the applicable conditions to
disbursement set forth in this Section and SECTIONS 4 through 8and
SECTION 10.
3.2 Method of Disbursement. Upon satisfaction of the applicable
conditions to disbursement set forth herein, the Disbursement Agent shall
disburse funds from the applicable Account as specified in the Disbursement
Request. Such disbursement shall be effected within one (1) business day of
satisfaction of the applicable conditions to disbursement of such funds.
3.3 Disbursement of Compensation.
3.3.1 Disbursement Agent's Compensation. The Disbursement Agent shall
be paid an initial acceptance fee of Five-Thousand Dollars ($5,000). For each
calendar month during the term of this Agreement, the Disbursement Agent shall
disburse from the Construction Disbursement Account One-Thousand Five-Hundred
Dollars ($1,500) to Disbursement Agent, as compensation for services to be
performed under this Agreement and such additional amounts as required to
compensate Disbursement Agent for any reasonable additional fees and expenses
including, without limitation, the fees and expenses of Disbursement Agent's
counsel, unless Disbursement Agent has received written notice from the
Company or the Trustee that the Disbursement Agent is in default under this
Agreement. The Disbursement Agent shall receive such payments without the
requirement of obtaining any further consent or action on the part of the
Company with respect to the payment. The initial payment pursuant to this
SECTION 3.3.1 shall be made as promptly as practicable following the deposit
of the Construction Proceeds into the Construction Disbursement Account but
shall be prorated if for a partial month. Disbursements for each subsequent
calendar month shall be made on the first day of each such subsequent calendar
month. The final payment pursuant to this SECTION 3.3.1 shall also be
prorated if for a partial month.
3.3.2 Independent Construction Consultant's Compensation. For each
calendar month during the term of this Agreement, the Disbursement Agent shall
disburse from the Construction Disbursement Account Twelve-Thousand Dollars
($12,000), plus reasonable expenses, to Independent Construction Consultant,
as compensation for services to be performed under this Agreement, unless
Independent Construction Consultant has received written notice from the
Company or the Trustee that it is in default under this Agreement.
Independent Construction Consultant may from time to time provide written
notice to the Disbursement Agent as to the place to which such disbursement
should be made. The Independent Construction Consultant shall receive such
payments without the requirement of obtaining any further consent or action on
the part of the Company or the Disbursement Agent with respect to the payment.
The initial payment pursuant to this SECTION 3.3.2 shall be made as
promptly as practicable following the deposit of the Construction Proceeds
into the Construction Disbursement Account but shall be prorated if for a
partial month. Disbursements for each subsequent calendar month shall be made
on the first day of each such subsequent calendar month. The final payment
pursuant to this SECTION 3.3.2 shall also be prorated if for a partial
month.
3.4 Transfer of Funds to the Trustee. Upon the receipt
of written notice
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executed by the Trustee, which certifies that an Event of Default has occurred
and is continuing and that the Trustee is entitled to the funds in the
Accounts, the Disbursement Agent shall deliver to the Trustee all funds in the
Accounts, other than amounts then permitted to be disbursed under clauses (i),
(ii) and (iii) of SECTION 8.3 hereof. The Disbursement Agent may rely on
the veracity of such certificate unless it has actual knowledge to the
contrary.
4. Agreements of the Company, the Independent Construction Consultant
and the
Disbursement Agent. The Company, the Independent Construction Consultant
and the Disbursement Agent severally agree, for the benefit of Trustee and the
holders of the Notes, as follows:
4.1 Disbursement Requests and Disbursements.
(a) The Company shall concurrently with the execution and delivery of
this Agreement submit to the Disbursement Agent, with a copy to the
Independent Construction Contractor, a request for the disbursement of funds
from the Construction Disbursement Account to pay certain Issuance Fees and
Expenses in the form of EXHIBIT A(the "INITIAL DISBURSEMENTS CERTIFICATE"),
together with the Borrowers Closing Certification executed by the Company in
the form of EXHIBIT B,and all exhibits attached thereto.
(b) The Company or, as set forth in ARTICLE 5,the Trustee, shall
have the right to submit to Disbursement Agent, with a copy to Trustee, a
request for the disbursement of funds from the Interest Reserve Account to pay
the interest due on the Notes, in the form of EXHIBIT C attached hereto (the
"INTEREST DISBURSEMENT REQUEST").
(c) The Company shall have the right from and after the commencement
of gaming operations at the Bossier City Project to submit to the Disbursement
Agent from time to time (but no more often than semi-monthly, unless otherwise
permitted by the Disbursement Agent), with a copy to Trustee, a request for
the disbursement of funds from the Operating Reserve Account to pay certain
operating expenses related to the operation of the Bossier City Project, each
in the form of EXHIBIT Dattached hereto (an "OPERATING DISBURSEMENT
REQUEST"), together with the exhibits attached thereto.
(d) The Company shall have the right from time to time during the
course of this Agreement (but no more often than semi-monthly, unless
otherwise permitted by the Disbursement Agent), to submit to the Disbursement
Agent, with a copy to Trustee and the Independent Construction Consultant, a
request for the disbursement of funds from the Completion Reserve Account to
the Construction Disbursement Account, each in the form of EXHIBIT E
attached hereto (a "COMPLETION RESERVE DISBURSEMENT REQUEST"), together with
the exhibits attached thereto.
(e) The Company shall have the right from time to time during the
course of this Agreement (but no more often than semi-monthly (other than
disbursements related to the Initial Disbursement Certificate), unless
otherwise permitted by the Disbursement Agent), to submit to the Disbursement
Agent, with a copy to Trustee and the Independent Construction Consultant, a
request for the disbursement of funds from the Construction Disbursement
Account to the Disbursed Funds Account in the form of EXHIBIT F attached
hereto (a "CONSTRUCTION DISBURSEMENT REQUEST"), together with the exhibits
attached thereto.
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(f) Provided that the Company has provided the Disbursement Agent
with a letter from its counsel specifying that the voters in both Bossier
Parish and Caddo Parish have approved the continuation of riverboat gaming
pursuant to the Louisiana Referendum, the Company shall have the right from
time to time during the course of this Agreement (but no more often than
semi-monthly, unless otherwise permitted by the Disbursement Agent) to submit
to the Disbursement Agent with a copy to the Trustee a request for the
disbursement of funds from the Escrow Account, each in the form of EXHIBIT G
attached hereto (the "ESCROW DISBURSEMENT REQUEST") together with the exhibits
attached thereto.
(g) The Disbursement Agent shall review each Disbursement
Request submitted pursuant to SECTIONS 4.1(A) through 4.1(F) above to
determine that they conform in form to the requirements of Exhibits A through
F and Exhibit 1, respectively and that, to the best of Disbursement Agent's
actual knowledge, all other the conditions applicable to such Disbursement
Request have been satisfied. The Disbursement Agent shall notify the Company
as soon as reasonably possible (and in any event within three (3) business
days after the Disbursement Agent receives the required documents) if any
Disbursement Request, or any portion thereof, is disapproved and the reason(s)
therefor.
(h) Provided that a Disbursement Request submitted pursuant to
SECTIONS 4.1(A) through 4.1(F)above is not disapproved by the Disbursement
Agent, within three (3) business days following submission of such
Disbursement Request, the Disbursement Agent shall disburse the funds
requested in such Disbursement Request, or such portion thereof as is approved
by Disbursement Agent.
4.2 Periodic Review of Bossier City Project.
(a) The Disbursement Agent shall exercise commercially reasonable
efforts and utilize commercially prudent practices in the performance of its
duties hereunder consistent with those of similar institutions disbursing
disbursement control funds. Commencing upon execution and delivery hereof,
the Disbursement Agent shall have the right, but shall have no obligation, to
meet periodically at reasonable times with representatives of the Company, the
Independent Construction Consultant and such other employees, consultants or
agents as the Disbursement Agent shall reasonably request to be present for
such meetings. In addition, the Disbursement Agent shall have the right, but
shall have no obligation, at reasonable times upon prior notice to review, to
the extent it deems necessary or appropriate, all information (including
Contracts) supporting the Disbursement Requests and any certificates in
support of any of the foregoing. The Disbursement Agent shall be entitled to
examine, copy and make extracts of the books, records, accounting data and
other documents of the Company, including without limitation bills of sale,
statements, receipts, contracts or agreements, which relate to any materials,
fixtures or articles incorporated into the Bossier City Project. The rights
of the Disbursement Agent under this SECTION 4.2 shall not be construed as
an obligation, it being understood that the Disbursement Agent's duty is
limited to act upon certificates and draw requests submitted by the Company
and the Trustee hereunder.
(b) The Independent Construction Consultant shall exercise
commercially reasonable efforts and utilize commercially prudent practices in
the performance of its duties hereunder consistent with those of similar
institutions disbursing disbursement control funds and reviewing construction
progress. Commencing upon execution and delivery hereof, the Independent
Construction
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Consultant shall have the right to meet periodically at reasonable times,
however no less frequently than monthly, with representatives of the Company,
the Project Architect, the General Contractors and such other employees,
consultants or agents as the Independent Construction Consultant shall
reasonably request to be present for such meetings; provided that the
Independent Construction Consultant shall attempt to meet with the Company,
the Project Architect and the General Contractors during its regularly
scheduled meetings, if reasonably possible. The Independent Construction
Consultant may perform such inspections of the Property then owned by the
Company and the Bossier City Project as it deems reasonably appropriate in the
performance of its duties hereunder, however no less frequently than
semi-monthly. In addition, the Independent Construction Consultant shall have
the right at reasonable times upon prior notice to review, to the extent it
deems necessary or appropriate, all information (including Contracts)
supporting the amendments to the Construction Disbursement Budget, amendments
to any Contracts, the Disbursement Requests and any certificates in support of
any of the foregoing, to inspect materials stored on the Property then owned
by the Company, to review the insurance required pursuant to the terms of the
Indenture, to confirm receipt of endorsements from Title Insurer insuring the
continuing priority of the lien of the Deed of Trust as security for each
advance of funds from the Construction Disbursement Account hereunder, and to
examine the Plans and all shop drawings relating to the Bossier City Project.
The Independent Construction Consultant is authorized to contact any payee for
purposes of confirming receipt of progress payments. The Independent
Construction Consultant shall be entitled to examine, copy and make extracts
of the books, records, accounting data and other documents of the Company,
including without limitation bills of sale, statements, receipts, conditional
and unconditional lien releases, contracts or agreements, which relate to any
materials, fixtures or articles incorporated into the Bossier City Project.
From time to time, at the request of the Independent Construction Consultant,
the Company shall make available to the Independent Construction Consultant a
Project Cost Schedule and/or a Construction Schedule for the Bossier City
Project. The Company agrees to cooperate with the Independent Construction
Consultant in assisting the Independent Construction Consultant to perform its
duties hereunder and to take such further steps as the Independent
Construction Consultant reasonably may request in order to facilitate the
Independent Construction Consultant's performance of its obligations
hereunder.
4.3 Letter of Agreement with Independent Construction Consultant.
The Trustee and the Company shall enter into that certain side letter with 2nd
Opinion, Inc. set forth as EXHIBIT 3 to EXHIBIT B-1.
5. Interest Reserve.
5.1 Interest Disbursements. Ten (10) days prior to February 15,
1997 (the "PAYMENT DATE"), the Company shall deliver to the Disbursement Agent
an Interest Disbursement Request describing the amount required to be paid,
the paying agent appointed pursuant to the Indenture (the "PAYING AGENT") to
which the Disbursement Agent should transfer funds in order to effect the
payment, and the Payment Date upon which such payment is due and payable. On
the Payment Date, the Disbursement Agent shall liquidate all of the Government
Securities (to the extent required) held in the Interest Reserve Account, and
disburse to the Paying Agent the amounts described in the Interest
Disbursement Request as due and payable on that date; provided, however, that
the Trustee may direct the Disbursement Agent to liquidate the Government
Securities (to the extent required), and disburse to the Paying Agent the
amounts necessary to pay the amounts required to be paid on the Notes in the
event that the Company fails to deliver the Interest Disbursement Request.
The Company acknowledges that the failure of the notice referenced in this
Section to be delivered to Disbursement Agent shall not
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in any way exonerate or diminish the Company's obligation to make all payments
under the Notes as and when due.
5.2 Interest Reserve Account Amounts. Upon receipt of an Officer's
Certificate from the Chief Financial Officer of the Company certifying that
the funds and Government Securities held in the Interest Reserve Account
exceeds the amount required to provide for payment in full of the interest
payments due on the Notes through February 15, 1997, the Disbursement Agent
shall transfer such excess amount to the Construction Disbursement Account.
Upon payment in full of all interest payments due on the Notes through
February 15, 1997, the Disbursement Agent shall transfer such excess amounts
to the Construction Disbursement Account.
6. Operating Reserve.
6.1 Conditions Precedent to Operating Reserve Disbursements. The
Disbursement Agent shall not make any disbursements from the Operating Reserve
Account unless the following conditions have been satisfied:
(a) Disbursement Agent has no actual knowledge that an Event of
Default exists and is continuing (it being understood that the Disbursement
Agent may rely upon the certificates delivered pursuant to this Agreement,
without further inquiry).
(b) The Operating Disbursement Request on its face has been completed
in the form set forth in EXHIBIT Dand the Disbursement Agent has no actual
knowledge that the certifications contained therein contain any material
errors, inaccuracies, misstatements or omissions of fact.
(c) No more than One Million Dollars ($1,000,000) of funds have
been disbursed from the Operating Reserve Account, unless the Disbursement
Agent has received an Officer's Certificate from the Company certifying that
the funds disbursed pursuant to the previous Operating Disbursement Request(s)
were utilized in substantially the manner as specified in such previous
Operating Disbursement Request(s).
6.2 Final Disbursement of Funds. If (a) the Bossier City Project
is Operating, as stated in the certificate of the Company provided below, and
(b) any funds remain in the Operating Reserve Account, then the Company shall
have the right to request that the Disbursement Agent disburse all remaining
funds in the Operating Reserve Account. Upon receipt by the Disbursement
Agent of a written certification from the Company certifying that (a) the
Bossier City Project commenced Operating and continues to be Operating as of
the date of the certification and (b) no Event of Default has occurred and is
continuing and no facts or circumstances exist which would constitute an Event
of Default with the passage of time, the Disbursement Agent shall, upon the
direction of the Company, disburse all remaining funds in the Operating
Reserve Account, if any, as directed by the Company; provided, that the
Company agrees that all funds disbursed to the Company pursuant to this
SECTION 6.2shall be used as required pursuant to SECTION 4.10of the
Indenture.
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7. Completion Reserve.
7.1 Conditions Precedent to Completion Reserve Disbursements. The
Disbursement
Agent shall disburse funds from the Completion Reserve Account to the
Construction Disbursement Account in an amount equal to that specified on the
applicable Completion Reserve Disbursement Request upon satisfaction of the
following conditions:
(a) The Completion Reserve Disbursement Request on its face has been
completed as to the information required therein and the required attachments,
if any, are attached and the Disbursement Agent shall have no actual knowledge
of any material errors, inaccuracies, misstatements or omissions of fact in
such Completion Reserve Disbursement Request or any exhibit or attachment
thereto.
(b) The Disbursement Agent shall have no actual knowledge that an
Event of Default exists and is continuing (it being understood that the
Disbursement Agent may rely upon the certificates delivered pursuant to this
Agreement, without further inquiry).
(c) A cost overrun has occurred and no previously unallocated
Available Funds exist to cover such cost overrun.
7.2 Final Disbursement of Funds. If (a) the Bossier City Project
is Operating, as stated in the certificate of the Company referred to below,
and (b) any funds remain in the Completion Reserve Account, then the Company
shall have the right to request that the Disbursement Agent disburse all
remaining funds in the Operating Reserve Account. Upon receipt by the
Disbursement Agent of (a) a written certification from the Company certifying
that (i) the Bossier City Project commenced Operating and continues to be
Operating as of the date of the certification and (ii) no Event of Default has
occurred and is continuing and no facts or circumstances exist which would
constitute an Event of Default with the passage of time and (b) a written
certification from the Independent Construction Consultant concurring with the
certifications set forth in subsection (a)(i) hereof, the Disbursement Agent
shall, upon the written direction of the Company, disburse all remaining funds
in the Operating Reserve Account, if any, to the Construction Disbursement
Account.
8. Conditions Precedent to Disbursement From Construction Disbursement
Account.
8.1 Initial Disbursements. Upon satisfaction of the conditions
described below in this SECTION 8.1, the Disbursement Agent shall make the
disbursements described in the Initial Disbursements Certificate (the "INITIAL
DISBURSEMENTS"). The conditions to the Initial Disbursement shall consist of
the following:
(a) Disbursement Agent shall have received the Proceeds;
(b) Disbursement Agent shall have received the Initial Disbursements
Certificate, and Disbursement Agent shall have received confirmation from the
Trustee that it has received the Initial Disbursements Certificate; and
(c) Disbursement Agent shall have received the Closing Certifications from
the Company, in the form of EXHIBIT B-1 attached hereto, and the Trustee, in
the form of EXHIBIT B-2
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attached hereto.
8.2 Conditions to Disbursements. Upon satisfaction of the
conditions described below in this SECTION 8.2, the Disbursement Agent shall
make the disbursements described in the corresponding Construction
Disbursement Request (provided that the conditions set forth in SECTION 8.1
above shall have previously been satisfied):
(a) The Company shall have submitted to the Disbursement Agent and
the Independent Construction Consultant, with a copy to the Trustee, a
Construction Disbursement Request as provided for herein pertaining to the
amounts requested for disbursement, together with a completed SCHEDULE 1 in
the form contemplated thereby and the certifications of the Independent
Construction Consultant in the form of EXHIBIT 1 attached to the
Construction Disbursement Request and in the event that the requested
Disbursement includes the certifications of Bellows, as relates to Bellows
Hard Costs, and ▇▇▇ ▇▇▇▇▇, as relates to ▇▇▇ ▇▇▇▇▇ Hard Costs, each in the
form of EXHIBIT 2 attached to the Construction Disbursement Request and in
the event that the requested Disbursement includes ▇▇▇ ▇▇▇▇▇ Hard Costs, ▇▇▇
▇▇▇▇▇, in the form of EXHIBIT 2,and in the event that the requested
Disbursement includes Hard Costs, the Project Architect, in the form of
EXHIBIT 3 attached to the Construction Disbursement Request.
(b) The Construction Disbursement Request on its face has been
completed as to the information required therein, and the required
attachments, if any, are attached, and the Disbursement Agent shall have no
actual knowledge of any material error, inaccuracy, misstatement or omission
of fact in a Construction Disbursement Request or an exhibit or attachment
thereto or information provided by the Company upon the request of the
Disbursement Agent.
(c) The Disbursement Agent has no actual knowledge (from the facts
set forth in any Disbursement Request or any certificate attached thereto or
any notice from the Trustee or the Company) that an Event of Default exists
and is continuing.
(d) In connection with all Disbursements for Hard Costs, the
Disbursement Agent shall have received an endorsement or a commitment from
Title Insurer evidencing the Title Insurer's unconditional commitment to issue
an endorsement to the Title Policy in the form attached as EXHIBIT K.
(e) The Company certifies that the respective amounts deposited into
the Disbursed Funds Account pursuant to any previous Construction Disbursement
Requests shall have been paid to the respective parties identified on
SCHEDULE 1 of each such previous Disbursement Requests, save and except for
such limited payments as Independent Construction Consultant determines to
have been withheld for good cause.
(f) No more than Five Hundred Thousand Dollars ($500,000) of
Disbursements for Soft Costs shall have been made, unless the Disbursement
Agent has received an Officer's Certificate from the company certifying that
the funds disbursed pursuant to the previous Construction Disbursement
Request(s) were utilized in substantially the manner as specified in such
previous Construction Disbursement Request.
8.3 Advance Disbursements. The Company shall have the right
from time to time
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(but no more frequently than twice per month, unless otherwise permitted by
the Disbursement Agent) to deliver to the Disbursement Agent an Advance
Disbursement Request in the form of Exhibit F-2, which Disbursement Request
shall not be required to include the supporting documentation required for all
other Disbursements; provided, however that (i) within 15 days after any
Advance Disbursement is made, the Company shall, with respect to such Advance
Disbursement, provide the same supporting documentation as is required under
this Agreement with respect to other Construction Disbursement Requests (which
documentation may be included in a subsequent Construction Disbursement
Request ) and (ii) in no event shall the outstanding balance of undocumented
Advance Disbursements from the Construction Disbursement Account at any one
time exceed the sum of $250,000. The Disbursement Agent shall approve such
Advance Disbursement Request so long as (a) the Advance Disbursement Request
on its face has been completed as to the information required therein and the
Disbursement Agent shall have no actual knowledge of any material error,
inaccuracy, misstatement or omission of fact in an Advance Disbursement
Request or information provided by the Company upon the request of the
Disbursement Agent and (b) the Disbursement Agent has no actual knowledge
(from the facts set forth in any Disbursement Request or any certificate
attached thereto or any notice from the Trustee or the Company) that an Event
of Default exists and is continuing.
8.4 Disbursements After Event of Default. In the event that, based
solely on the Disbursement Agent's actual knowledge, the Disbursement Agent
determines that an Event of Default exists and is continuing for any month,
the Disbursement Agent shall not approve any disbursement of funds from the
Construction Disbursement Account pursuant to a Construction Disbursement
Request for the Bossier City Project other than the following:
(i) if all other conditions in SECTION 8.2(including those
stated in SECTION 8.1 hereof) are met, the Disbursement Agent shall disburse
funds from the Construction Disbursement Account, as instructed by the
Independent Construction Consultant in writing for work completed or materials
purchased on or prior to the date that the Disbursement Agent, based solely on
the Disbursement Agent's actual knowledge, determined that an Event of Default
exists and is continuing ;
(ii) payments not to exceed four million dollars ($4,000,000) in
the aggregate to prevent the condition of the Bossier City Project from
deteriorating or to preserve any work completed on the Bossier City Project,
certified to the Disbursement Agent in writing by the Independent Construction
Consultant to be reasonably necessary or advisable; provided, however, that
the foregoing limitation may be increased or decreased by the Trustee by
written notice to the Disbursement Agent; and
(iii) if such condition continues for a period of three (3)
consecutive months or more, at the written request of the Company, Retainage
Amounts for work completed; provided that the Company and the Project
Architect certify to the Disbursement Agent in writing the amount required to
be paid for such Retainage Amounts and that the conditions for paying such
amounts (other than that the Bossier City Project will be Operating) are met.
8.5 Final Disbursement of Funds Following Operating
Date. If (a) the
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Bossier City Project is Operating and (b) any funds remain in the Construction
Disbursement Account, then the Company shall have the right to request that
the Disbursement Agent disburse all remaining funds in the Construction
Disbursement Account. Upon receipt by the Disbursement Agent of (a) a written
certification from the Company that (i) the Bossier City Project commenced
Operating, and the Bossier City Project continues to be Operating as of the
date of the certification, (ii) no Event of Default has occurred and is
continuing and no facts or circumstances exist which, with the passage of
time, would constitute an Event of Default and (iii) the Company has generated
Consolidated Cash Flow in an amount equal to or greater than the amount
remaining in the Construction Disbursement Account, and (b) a written
certification, from the Independent Construction Consultant concurring with
the certifications set forth in subsection (a)(i) hereof, then the
Disbursement Agent shall disburse all remaining funds in the Construction
Disbursement Account, if any, as directed by the Company (the "FINAL
DISBURSEMENT"); provided, however, that the Disbursement Agent shall first
disburse funds to the Disbursed Funds Account in amounts certified in writing
by the Independent Construction Consultant as sufficient to pay any then
unpaid Retainage Amounts and upon receipt of a certificate from the
Independent Construction Consultant certifying that it has received
unconditional lien waivers from all contractors, subcontractors, materialmen
or suppliers relating to construction of the Bossier City Project; provided,
further, that all finds disbursed to the Company pursuant to this SECTION
8.4 shall be used by the Company as required pursuant to SECTION 4.10 of
the Indenture.
9. Amendments to Construction Disbursement Budget, Amendments to
Contracts.
9.1 Construction Disbursement Budget Amendment Process. The
Construction Disbursement Budget may be amended from time to time in the
manner set forth herein. Subject to SECTION 9.2 below, the Company shall
have the right from time to time to amend the Construction Disbursement Budget
to increase the amounts allocated for specific line item components of the
work required to complete the Bossier City Project. Any such amendment shall
be in writing and be submitted to the Disbursement Agent and the Independent
Construction Consultant by an Officer's Certificate in the form of EXHIBIT G
hereto, together with the Independent Construction Consultant's certification,
as provided in EXHIBIT 1 to the Construction Disbursement Budget Amendment
Certificate, the General Contractor's certification from both Bellows and ▇▇▇
▇▇▇▇▇, as provided in EXHIBIT 2 to the Construction Disbursement Budget
Amendment Certificate and the Project Architect's certification, as provided
in EXHIBIT 3 to the Construction Disbursement Budget Amendment Certificate.
Upon receipt by the Disbursement Agent of an Officer's Certificate in the form
of EXHIBIT G and the attachments, all of which must be completed as to the
information required therein, such amendment shall become effective hereunder
and the Construction Disbursement Budget shall thereafter be as so amended.
9.2 Contract Amendment Process. The Company shall have the right
from time to time to amend any Contract to which it is a party to change the
scope of the work and the Company's payment obligations thereunder. Any such
amendment that (i) results in a cost increase in excess of Twenty-Five
Thousand ($25,000) in a Contract, the value of which is at least One-Hundred
Thousand ($100,000) or (ii) results in a lessening of the scope or quality of
the work constituting the construction of the Bossier City Project, the value
of which is in excess of Twenty-Five Thousand Dollars ($25,000) in a Contract
the value of which is at least One-Hundred Thousand Dollars ($100,000), shall
be in writing and shall identify with particularity all changes being made.
The Company shall deliver to the Disbursement Agent (a) an executed copy of
the Contract amendment (with the effectiveness thereof subject only to
satisfaction of the conditions in this SECTION 9.2);and (b) an Officer's
Certificate in the
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form attached hereto as EXHIBIT H,together with the Independent Construction
Consultant's certification as provided in EXHIBIT 1 to the Contract
Amendment Certificate, in the event that such Contract relates to Hard Costs,
the General Contractor's certification as provided in EXHIBIT 2 to the
Contract Amendment Certificate, executed by ▇▇▇ ▇▇▇▇▇ if such Contract relates
to ▇▇▇ ▇▇▇▇▇ Hard Costs and Bellows if the Contract relates to Bellows Hard
Costs and the Project Architect's certification as provided in EXHIBIT 3 to
the Contract Amendment Certificate, completed as to the information required
therein. The Contract Amendment shall be deemed approved upon receipt by the
Company of Disbursement Agent's acknowledgment of receipt of items required
under this SECTION 9.2.
9.3 Project Cost Schedule and Cost Overruns.
(a) The Company covenants to promptly cure any cost overrun for any
line item by (i) providing sufficient funds to cover in full such cost
over-run from (A) previously unallocated Available Funds as permitted in this
Agreement (but in each case only to the extent that the same have not
previously been expended or dedicated (including Retainage Amounts) to the
payment of items contained in the Construction Disbursement Budget) or (B) if
the conditions precedent to a disbursement from the Completion Reserve Account
are satisfied, from funds in the Completion Reserve Account; and (ii)
effecting a Construction Disbursement Budget Amendment to dedicate such funds
to the line item in question.
(b) Each Project Cost Schedule shall set forth (i) the actual
investment income earned on the Completion Reserve Account and the
Construction Disbursement Account through the date of such Project Cost
Schedule, and (ii) the additional amount of investment income which the
Company reasonably anticipates will accrue on the Completion Reserve Account
and the Construction Disbursement Account from such date through the
anticipated date on which the Bossier City Project first will be Operating.
If at any time the Company submits a Project Cost Schedule pursuant to this
paragraph and can no longer reasonably anticipate that the Additional Revenue
earned (and anticipated to be earned through the anticipated date on which the
Bossier City Project first will be Operating) from investments of funds in the
Completion Reserve Account and the Construction Disbursement Account will
equal the amount of such Additional Revenue anticipated as of the date of the
Initial Disbursement (as set forth in the Initial Construction Disbursement
Budget), then, so long as the Disbursement Agent has no actual knowledge that
an Event of Default exists and is continuing:
(i) if the total amount of such Additional Revenue at such date
earned or anticipated to be earned is less than the total amount of such
Additional Revenue anticipated as of the date of the Initial Disbursement,
then the Available Funds shall be deemed reduced by the amount of such
deficiency and the Company (as a condition to the next Construction
Disbursement Request) shall provide or allocate additional Available Funds or,
if necessary disburse funds from the Completion Reserve Account so long as the
conditions precedent are satisfied, and/or otherwise amend the Construction
Disbursement Budget if necessary so that the total Project Costs do not exceed
total Available Funds; or
(ii) if the total amount of such Additional Revenue at such date
earned or anticipated to be earned is greater than the total amount of such
Additional Revenue anticipated as of the date of the Initial Disbursement,
then the Available Funds shall be deemed increased by the amount of such
excess but only as and when such excess is actually earned and deposited in
the Construction Disbursement Account.
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10. Escrow Account.
10.1 Deposit of Proceeds into Escrow Account. In the event that
the Crescent City Riverboat is sold prior to the date on which the voters in
the Bossier Parish and the Caddo Parish approve riverboat gaming pursuant to
the Louisiana Referendum, the Company shall immediately deposit all proceeds
from such sale into the Escrow Account.
10.2 Conditions Precedent to Escrow Account Disbursement. The
Disbursement Agent's approval of any disbursements from the Escrow Account
shall be subject to the following conditions:
(a) Disbursement Agent has no actual knowledge that an Event of
Default exists and is continuing (it being understood that the Disbursement
Agent may rely upon the certificates delivered pursuant to this Agreement,
without further inquiry).
(b) The Escrow Disbursement Request on its face has been completed in
the form of EXHIBIT I and the Disbursement Agent shall have no actual
knowledge of any material errors, inaccuracies, mistakes or omissions of fact
contained in the Escrow Disbursement Request.
(c) The Company has delivered to the Disbursement Agent a letter from
its counsel stating that the voters in the Bossier Parish and the Caddo Parish
have approved the continuation of riverboat gaining pursuant to the Louisiana
Referendum.
10.3 Disbursement in the Event Riverboat Gaming is Discontinued.
In the event that the Company is unable to deliver the letter required
pursuant to SECTION 10.2(C)hereof, all proceeds in the Escrow Account shall
be deemed Excess Proceeds and shall be utilized to make an offer to purchase
Notes pursuant to SECTION 3.10 of the Indenture.
11. Events of Default. The occurrence of any of the following
specified events shall be an "EVENT OF DEFAULT" hereunder.
11.1 Continuance of an Event of Default under the Indenture.
11.2 The Disbursement Agent is unable to approve a Disbursement Request
due to
the failure of the Company to satisfy the conditions precedent to such
Disbursement Request set forth herein, including without limitation the
condition precedent that the Independent Construction Consultant deliver the
certificates required under this Agreement.
11.3 The Independent Construction Consultant reports to the
Disbursement Agent and the Company an exception to a prior disbursement
relating to the Bossier City Project which is not remedied within 10 days.
11.4 Any representation, warranty, certification or statement by the
Company in this Agreement, or any certificate, request, budget or statement
delivered pursuant to this Agreement, shall be untrue in any material respect
on the date given or made and such untruthfulness continues for a period of
five (5) business days after notice hereof.
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11.5 Any time that the amount remaining in the Construction
Disbursement Account and the Completion Reserve Account is less than the
amount required in the Construction Disbursement Budget to cause the Bossier
City Project to become Operating on or before its Operating Deadlines and such
deficiency continues for a period of thirty (30) days.
11.6 The failure of the Company to deliver any documents required by
the Pledge Agreement and such failure continues for a period of ten (10) days.
12. Disbursed Funds Accounts.
12.1 Rights of the Company to Disbursed Funds Accounts. The
Disbursed Funds Account shall be maintained in the name of the Company and all
funds deposited or held in such account shall belong to the Company. All
funds deposited and held in the Disbursed Funds Account shall, pending
disbursement in accordance with this Agreement, be invested in cash or Cash
Equivalents. Pursuant to the Pledge Agreement, the Company has granted to the
Trustee (for the benefit of the holders of the Notes) a first priority
security interest in its Disbursed Funds Account. Funds in the Disbursed
Funds Account shall be disbursed solely in accordance with the terms and
conditions of this Agreement. Further, the Company shall note in its records
that all funds and other assets in the Disbursed Funds Account have been
pledged to the Trustee.
12.2 Right to Substitute Disbursed Funds Account. The Company,
from time to time shall have the right to designate a substitute account to
serve as the Disbursed Funds Account, provided that no such substitute account
shall become the "Disbursed Funds Account" until (a) the depository financial
institution at which the substitute account is located shall have acknowledged
in a manner satisfactory to the Trustee that such institution has waived its
right of set off in such account or any liens thereto, statutory or otherwise,
and (b) the Trustee shall have received notice of the location and account
number of such new substitute account.
13. Limitation of Liability.
13.1 Disbursement Agent's Limitation of Liability. Disbursement
Agent's responsibility and liability under this Agreement shall be limited as
follows: (a) Disbursement Agent does not represent, warrant or guaranty to the
Trustee or the holders of the Notes the performance of the Company, the
Independent Construction Consultant, the Project Architect, the General
Contractors, any contractor, subcontractor or provider of materials or
services in connection with construction of the Bossier City Project; (b)
Disbursement Agent shall have no responsibility to the Company, the Trustee or
the holders of the Notes as a consequence of performance by Disbursement Agent
hereunder except for any gross negligence or willful misconduct of
Disbursement Agent; (c) the Company shall remain solely responsible for all
aspects of its business and conduct in connection with its Property and the
Bossier City Project, the accuracy of all applications for payment, and the
proper application of all disbursements; (d) Disbursement Agent is not
obligated to supervise, inspect or inform the Company, the Trustee or any
third party of any aspect of the construction of the Bossier City Project or
any other matter referred to above; (e) Disbursement Agent owes no duty of
care to the Company, to protect against, or to inform the Company of, any
negligent, faulty, inadequate or defective design or construction of the
Bossier City Project; and (f) the Disbursement Agent shall have no
responsibility or liability for the perfection or continuation of perfection
of any lien or security interest; provided, however, that the foregoing
provision shall not release Disbursement Agent from liability resulting from
23
a failure to comply with SECTION 2 hereof or from its gross negligence or
willful misconduct. Disbursement Agent shall have no duties or obligations
hereunder except as expressly set forth herein, shall be responsible only for
the performance of such duties and obligations, shall not be required to take
any action otherwise than in accordance with the terms hereof and shall not be
in any manner liable or responsible for any loss or damage arising by reason
of any act or omission to act by it hereunder or in connection with any of the
transactions contemplated hereby, including, but not limited to, any loss that
may occur by reason of forgery, false representations, the exercise of its
discretion, or any other reason, except for its gross negligence or willful
misconduct.
13.2 Independent Construction Consultant's Limitation of Liability.
Independent Construction Consultant's responsibility and liability under this
Agreement shall be limited as follows: (a) Independent Construction Consultant
does not represent, warrant or guaranty to the Trustee or the holders of the
Notes the performance of the Company, the Disbursement Agent, the Project
Architect, the General Contractors, any contractor, subcontractor or provider
of materials or services in connection with construction of the Bossier City
Project and (b) the Company shall remain solely responsible for all aspects of
its business and conduct in connection with its Property and the Bossier City
Project, the accuracy of all applications for payment, and the proper
application of all disbursements. The Independent Construction Consultant
shall have no duties or obligations hereunder except as expressly set forth
herein, shall be responsible only for the performance of such duties and
obligations, shall not be required to take any action otherwise than in
accordance with the terms hereof and shall not be in any manner liable or
responsible for any loss or damage arising by reason of any act or omission to
act by it hereunder or in connection with any of the transactions contemplated
hereby, including, but not limited to, any loss that may occur by reason of
forgery, false representations, the exercise of its discretion, or any other
reason, except for its gross negligence or willful misconduct. The
Independent Construction Consultant shall have the right to rely (so long as
such reliance is reasonable and in good faith) on certificates received from
the Company, the General Contractors and the Project Architect; provided that
nothing contained in this sentence shall require the Independent Construction
Consultant to obtain certificates from the General Contractors and the Project
Architect in connection with Disbursements for Soft Costs.
14. Indemnity and Insurance.
14.1 Indemnity of Disbursement Agent. The Company, indemnifies,
protects, holds harmless and agrees to defend Disbursement Agent and its
officers, directors, agents and employees, from and against any and all
claims, actions, obligations, liabilities and expenses, including defense
costs, investigative fees and costs, legal fees, and claims for damages,
arising from Disbursement Agent's performance under this Agreement, except to
the extent that such liability, expense or claim is attributable to the gross
negligence or willful misconduct of Disbursement Agent.
14.2. Insurance. The Disbursement Agent, at its sole cost and expense,
shall purchase and maintain throughout the ten-n of this Agreement, the
following insurance policies:
14.2.1 Comprehensive general liability insurance, with minimum limits of
Two Million Dollars ($2,000,000) combined single limit per occurrence,
covering all bodily injury and property damage arising out of its operation
under this Agreement. This policy shall name Trustee, and the Company, and
its officers, agents and employees as additional insureds, and shall
constitute primary insurance as to Trustee so that any other policies held by
Trustee shall not contribute to any loss under said insurance.
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14.2.2 Workers' compensation insurance covering all of its
employees and volunteers.
Said policies shall provide for thirty (30) days' prior written notice to the
Trustee, and the Company of cancellation or material change. If any of such
insurance is written on a claims made form, following termination of this
Agreement, coverage shall survive for the maximum reporting period available
at each anniversary date of such insurance, or not less than five (5) years,
whichever is greater. The limits of coverage required under subparagraph (a)
above shall not in any way limit the liability of the Company under SECTIONS
9.1 or 9.2 hereof.
15. Termination. This Agreement shall terminate automatically
thirty (30) days following disbursement of all funds remaining in the
Accounts, unless sooner terminated pursuant to SECTION 10 hereof, provided,
however, that (a) the obligations of the Company under SECTION 14 of this
Agreement shall survive termination of this Agreement and (b) if, following an
Event of Loss, there exist Net Loss Proceeds that (in accordance with Section
4.11 of the Indenture) are deliverable to the Trustee and are eligible for
distribution to the Company for rebuilding, repair, replacement, or
construction, then, the Company, the Disbursement Agent and the Independent
Construction Consultant shall execute and deliver to the Trustee such
documentation as the Trustee reasonably deems appropriate in order to cause
(i) the Trustee to possess a first priority perfected security interest in
said funds, and (ii) the Disbursement Agent and the Independent Construction
Contractor to administer the disbursement of said funds for such rebuilding,
repair, replacement or construction pursuant to disbursement control
procedures substantially akin to those set forth herein. In the event that
the Net Loss Proceeds are so distributed, the Disbursement Agent shall be paid
the sum of One-Thousand Five-Hundred Dollars ($1,500) per month during the
period of such engagement and the Independent Construction Consultant shall be
paid the sum of Twelve Thousand Dollars ($12,000) per month during the period
of such engagement.
16. Substitution or Resignation.
16.2.1 The Trustee shall have the right, upon the expiration of
thirty (30) days following delivery of written notice of substitution to
Disbursement Agent, the Independent Construction Consultant, and the Company
to cause Disbursement Agent to be relieved of its duties hereunder and to
select a substitute disbursement agent to serve hereunder. Disbursement Agent
may resign at any time upon thirty (30) days' written notice to all parties
hereto. Such resignation shall take effect upon receipt by Disbursement Agent
of an instrument of acceptance executed by a successor disbursement agent and
consented to by the other parties hereto. Upon selection of such substitute
disbursement agent, the Trustee, the Company and the substitute disbursement
agent shall enter into an agreement substantially identical to this Agreement
and, thereafter, Disbursement Agent shall be relieved of its duties and
obligations to perform hereunder, except that Disbursement Agent shall
transfer to the substitute disbursement agent upon request therefor originals
of all books, records, and other documents in Disbursement Agent's possession
relating to this Agreement. The substitute disbursement agent selected by the
Trustee shall be a national bank capable of maintaining book entry accounts
with the federal reserve bank.
16.2.2 The Company shall have the right, upon the expiration of
thirty(30)days
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following delivery of written notice of substitution to the Disbursement
Agent, the Independent Construction Consultant, and the Trustee to cause the
Independent Construction Consultant to be relieved of its duties hereunder and
to select a substitute independent construction consultant to serve hereunder.
The Independent Construction Consultant may resign at any time upon thirty
(30) days' written notice to all parties hereto. Such resignation shall take
effect upon receipt by Independent Construction Consultant of an instrument of
acceptance executed by a successor independent construction consultant and
consented to by the other parties hereto. Upon selection of such substitute
independent construction consultant, the Trustee, the Company and the
substitute independent construction consultant shall enter into a side letter
wherein the substitute independent construction consultant agrees to perform
the duties of the independent construction consultant pursuant to the terms
hereof and for the benefit of the Trustee and the holders of the Notes and,
thereafter, Independent Construction Consultant shall be relieved of its
duties and obligations to perform hereunder, except that Independent
Construction Consultant shall transfer to the substitute independent
construction consultant upon request therefor originals of all books, records,
and other documents in Independent Construction Consultant's possession
relating to this Agreement. The substitute independent construction
consultant selected by the Company shall be recognized nationally or in
Louisiana as an expert in connection with the oversight of construction
practices and construction disbursement procedures for construction projects
of similar size and scope.
17. Account Statement. Upon the request of the Trustee, the
Company or the Independent Construction Consultant, the Disbursement Agent
shall deliver to the Company, the Independent Construction Consultant and
Trustee a statement prepared by the Disbursement Agent in a form satisfactory
to the Independent Construction Consultant, the Trustee and the Company,
setting forth with reasonable particularity the balance of funds then in the
Interest Reserve Account, Operating Reserve Account, Completion Reserve
Account, Construction Disbursement Account, and/or the Disbursed Funds
Accounts and the manner in which such funds are invested; provided, however,
that the Disbursement Agent shall not be required to provide such statements
more often than weekly.
18. Notice. The parties hereto irrevocably instruct the
Disbursement Agent that on the first date upon which the balance in any of the
Operating Reserve Account, the Completion Reserve Account and/or the
Construction Disbursement Account is reduced to zero, the Disbursement Agent
shall deliver to the Trustee, the Independent Construction Consultant, and the
Company a notice that the balance in such account(s) has been reduced to zero
(0).
19. Miscellaneous.
19.1 Waiver. Any party hereto may specifically waive any breach of
this Agreement by any other party, but no such waiver shall be deemed to have
been given unless such waiver is in writing, signed by the waiving party and
specifically designates the breach waived, nor shall any such waiver
constitute a continuing waiver of similar or other breaches.
19.2 Invalidity. If, for any reason whatsoever, anyone or more of
the provisions of this Agreement shall be held or deemed to be inoperative,
unenforceable or invalid in a particular case or in all cases, such
circumstances shall not have the effect of rendering any of the other
provisions of this Agreement inoperative, unenforceable or invalid, and the
inoperative, unenforceable or invalid provision shall be construed as if it
were written so as to effectuate, to the maximum extent possible, the parties'
intent.
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19.3 No Authority. The Disbursement Agent shall not have any authority
to, and the Disbursement Agent shall not make any warranty or representation
or incur any obligation on behalf of, or in the name of, the Trustee.
19.4 Assignment. This Agreement is personal to the parties hereto,
and the rights and duties of any party hereunder shall not be assignable
except with the prior written consent of the other parties. In any event,
this Agreement shall inure to and be binding upon the parties and their
successors and permitted assigns.
19.5 Benefit. The parties hereto, the holders from time to time of
the Notes, and their respective successors and assigns, but no others, shall
be bound hereby and entitled to the benefits hereof.
19.6 Time. Time is of the essence of each provision of this Agreement.
19.7 Choice of Law. The existence, validity, construction,
operation and effect of any and all terms and provisions of this Agreement
shall be determined in accordance with and governed by the substantive laws of
the State of Louisiana, without giving effect to its conflicts of law
principles.
19.8 Entire Agreement: Amendments. This Agreement contains the
entire agreement among the parties with respect to the subject matter hereof
and supersedes any and all prior agreements, understandings and commitments,
whether oral or written. This Agreement may be amended only by a writing
signed by duly authorized representatives of all parties.
19.9 Notices. All notices and other communications required or
permitted to be given or made under this Agreement shall be in writing and
shall be deemed to have been duly given and received, regardless of when and
whether received, either; (a) on the day of hand delivery; (b) on the date of
confirmation of receipt of electronic facsimile transmission; or (c) on the
day sent, when sent by United States certified mail, postage and certification
fee prepaid, return receipt requested, addressed as follows:
To Disbursement Agent:
First National Bank of Commerce
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
27
To the Trustee:
First Union Bank of Connecticut
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Corporate Trust Administration
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
To the Company:
Casino Magic of Louisiana, Corp.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as the specified entity most recently may have
designated in writing in accordance with this paragraph to the others.
19.10 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
19.11 Captions. Captions in this Agreement are for convenience only
and shall not be considered or referred to in resolving questions of
interpretation of this Agreement.
19.12 Arbitration. (a) Any disagreement with respect to the release
of funds from the Operating Reserve Account, the Completion Reserve Account,
the Construction Disbursement Account or the Escrow Account, or any related
disagreement with respect to the construction, meaning or effect of this
Agreement, arising out of this Agreement or concerning the rights or
obligations of the parties hereunder shall be submitted to arbitration, one
arbitrator to be chosen by the Company, one by the Trustee, and a third to be
chosen by the first two arbitrators before they enter into arbitration. The
arbitrators shall be impartial and shall be active or retired persons with
experience in construction, development and/or construction lending.
(b) In the event that either party should fail to choose an
arbitrator within fifteen (15) days following a written request by the other
party to enter into arbitration, the requesting party may choose two
arbitrators who shall, in turn, choose the third arbitrator. If the first two
arbitrators have not chosen a third arbitrator at the end of fifteen (I 5)
days following the last day of the selection of the first two arbitrators,
each of the first two arbitrators shall name three candidates, of whom the
other arbitrator shall eliminate two, and the determination of the third
arbitrator shall be made from the remaining two candidates by drawing lots.
Each party shall present its case to the arbitrators within fifteen (15) days
following the date of the appointment of the third arbitrator. The decision
of a majority of the three arbitrators shall be final and binding upon both
parties. Judgment may be
28
entered upon the arbitration award in any court having jurisdiction. Any such
arbitration shall take place in Louisiana unless some other location is
mutually agreed upon by the parties. The arbitrators shall resolve any
dispute arising hereunder in a manner consistent with the intent of the
parties as expressed in this Agreement. The arbitrators shall not award any
punitive, consequential or exemplary damages or any amount in excess of the
amount to be released from the relevant Account.
(c) The parties shall use their best efforts to resolve the dispute
as soon as practicable and to comply, if available, with the fast track
procedures specified in the American Arbitration Association's Construction
Industry Arbitration Rules. Judgment on the award rendered by the
arbitrator(s) may be entered in any court having jurisdiction thereof.
(d) Notwithstanding any provisions contained herein to the contrary,
the provisions contained in this SECTION 19.12 shall not prohibit Trustee
from exercising any of its rights or remedies set forth in the Indenture or
Collateral Documents.
29
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of
the day first above written.
DISBURSEMENT AGENT: FIRST NATIONAL BANK OF COMMERCE,
a national banking association corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President & Trust Officier
TRUSTEE: FIRST UNION OF CONNECTICUT BANK, a
Connecticut state banking corporation
By: /s/ W. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Name: W. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
COMPANY: CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President and General Council
30
EXHIBIT A TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
INITIAL DISBURSEMENTS CERTIFICATE
August 23, 1996
First National Bank of Commerce,
as Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Casino Magic of Louisiana, Corp.
Cash Collateral and Disbursement Agreement
Initial Disbursements
Ladies and Gentlemen:
This Initial Disbursements Certificate is delivered to you pursuant to
that certain Cash Collateral and Disbursement Agreement dated August 22, 1996,
by and among First National Bank of Commerce, as Disbursement Agent, First
Union Bank of Connecticut, as Trustee, and Casino Magic of Louisiana, Corp.
(the "COMPANY") (the "DISBURSEMENT AGREEMENT"). Capitalized terms used herein
shall have the meanings assigned to such terms in the Disbursement and Loan
Agreement.
The Company hereby irrevocably instructs the Disbursement Agent to
disburse the following
sums from the Construction Disbursement Account to the following parties:
(a) Five-Thousand Dollars ($5,000) to the Disbursement Agent, as the
compensation payable
to the Disbursement Agent as an acceptance fee;
(b) Ten Thousand Dollars ($10,000) to the Independent Construction
Consultant for work through August 31, 1996 in connection with its initial
review of the Plans and Construction Disbursement Budget; and
(c) Seven Thousand Five Hundred Dollars ($7,500) to Disbursement
Agent's counsel, as
payment for fees and expenses relating to its review of the Disbursement
Agreement.
A-1
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
▇-▇
▇▇▇▇▇▇▇ ▇-▇ TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
FORM OF BORROWERS CLOSING CERTIFICATION
August 23, 1996
First Union Bank of Connecticut, as Trustee
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
First National Bank of Commerce,
as Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Cash Collateral and Disbursement Agreement
Ladies and Gentlemen:
This Closing Certification is delivered to you pursuant to that certain
Cash Collateral and Disbursement Agreement dated as of August 22, 1996 by and
among First National Bank of Commerce, as Disbursement Agent, First Union Bank
of Connecticut, as Trustee, and Casino Magic of Louisiana, Corp. (the
"COMPANY") (the "DISBURSEMENT AGREEMENT"). Capitalized terms used herein
shall have the meanings assigned to such terms in the Disbursement Agreement.
The Company, hereby certifies to each of you as follows:
1. As of the date hereof, there is no reason to believe that the
date on which the Bossier City Project will become Operating will not occur on
or prior to its Operating Deadline.
2. The Initial Construction Disbursement Budget attached hereto as
Exhibit 1 constitutes the Construction Disbursement Budget presently in
effect for the Bossier City Project.
3. Said Initial Construction Disbursement Budget accurately sets
forth the anticipated Construction Expenses through the date that the Bossier
City Project is Operating and the various components of the Bossier City
Project identified thereon as line items, all within the respective line item
amounts listed.
4. As of the date hereof, there are sufficient Available Funds to pay
for the anticipated costs described in paragraph 3 above in accordance with
the Disbursement Agreement, and, after giving effect to the Initial
Disbursements, any other expenses that the Company believes will need to be
incurred in order to cause the Bossier City Project to be Operating on or
before its Operating Deadline.
5. There is no Event of Default under the Indenture or the
Disbursement Agreement or any
B-1
event, omission or failure of a condition which would constitute an Event of
Default under the Indenture or the Disbursement Agreement after notice or
lapse of time or both.
6. Attached hereto as Exhibit 2 is a list of all contractors,
subcontractors, suppliers and materialmen that have provided work, supplies
and/or labor in connection with the Bossier City Project to date. Attached
hereto are lien releases (unconditional if such contractors, subcontractors,
suppliers and materialmen have been paid to date and conditional if such
contractors, subcontractors, suppliers and materialmen have not been paid to
date) from such contractors, subcontractors, suppliers and materialmen.
7. Attached hereto as Exhibit 3 is an executed copy of that certain
side letter from the Independent Construction Consultant dated as of August
22, 1996, pursuant to which the Independent Construction Consultant agrees to
perform the obligations and the duties of the Independent Construction
Consultant set forth herein.
The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Initial Disbursement.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
B-2
EXHIBIT 1 TO EXHIBIT B-1
INITIAL CONSTRUCTION DISBURSEMENT BUDGET FOR
BOSSIER CITY PROJECT
CONSTRUCTION DISBURSEMENT BUDGET
Bossier Riverboat improvements $2,000,000
Pavilion 8,500,000
Parking garage 6,700,000
Gaming equipment 2,900,000
Furniture, fixtures and equipment 1,100,000
Site development 6,300,000
Temporary facilities 1,000,000
Preopening costs 3,800,000
Opening bankroll 1,700,000
$34,000,000
B-3
EXHIBIT 2 TO EXHIBIT B-1
MECHANIC'S LIENS FOR
BOSSIER CITY PROJECT
Arcadia Rebar
▇▇▇▇▇ Concrete
Berkel Company
Bird & Son
▇▇▇▇▇▇▇▇ Design Group, Inc.
▇▇▇ ▇▇▇▇▇ Construction Company
▇▇▇▇▇▇▇ Brothers
Service Marine Industries, Inc.
▇.▇. ▇▇▇▇▇▇▇ Construction Company, Inc.
B-4
EXHIBIT 3 TO EXHIBIT B-1
INDEPENDENT CONSTRUCTION CONSULTANT'S SIDE LETTER FOR
BOSSIER CITY PROJECT
B-5
EXHIBIT B-2 TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
FORM OF DISBURSEMENT AGENT'S CLOSING CERTIFICATION
August 23, 1996
First Union Bank of Connecticut
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Corporate Trust Administration
Re: Casino Magic of Louisiana, Corp. (the "Company")
Cash Collateral and Disbursement Agreement
Disbursement Agent's Closing Certification
Ladies and Gentlemen:
This Closing Certification is delivered to you pursuant to that certain
Cash Collateral and Disbursement Agreement dated as of August 22, 1996, by and
among First National Bank of Commerce, as Disbursement Agent, First Union Bank
of Connecticut, as Trustee, and Casino Magic of Louisiana, Corp. (the
"COMPANY") the "DISBURSEMENT AGREEMENT"). Capitalized terms used herein shall
have the meanings assigned to such terms in the Disbursement Agreement.
Disbursement Agent hereby certifies to each of you as follows as
contemplated by SECTION
8.1(C) of the above-referenced Disbursement Agreement:
1 . The Accounts have been established as contemplated by the
Disbursement Agreement.
2. Disbursement Agent has received (a) from the Company, an executed
Initial Disbursements Certificate and (b) from the Company, an executed
Closing Certificate in the form attached to the Disbursement Agreement as
EXHIBIT B-1.
B-6
The foregoing representations, warranties and certifications are true and
correct and you each are entitled to rely on the foregoing in connection with
the Initial Disbursements. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to them in the Disbursement
Agreement.
FIRST NATIONAL BANK OF COMMERCE,
as Disbursement Agent
By:
Name:
Title:
B-7
EXHIBIT B-3 TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
FORM OF TRUSTEE'S CLOSING CERTIFICATION
August 23, 1996
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Casino Magic of Louisiana, Corp. (the "Company")
Cash Collateral and Disbursement Agreement
Trustee's Closing Certification
Ladies and Gentlemen:
This Closing Certification is delivered to you pursuant to that certain
Cash Collateral and Disbursement Agreement dated as of August, 22, 1996, by
and among First National Bank of Commerce, as Disbursement Agent, First Union
Bank of Connecticut, as Trustee, and Casino Magic of Louisiana, Corp. (the
"COMPANY") (the "DISBURSEMENT AGREEMENT"). Capitalized terms used herein
shall have the meanings assigned to such terms in the Disbursement Agreement.
First Union Bank of Connecticut (the "TRUSTEE") hereby certifies to each
of you as follows as contemplated by SECTION 8.1of the above-referenced
Disbursement Agreement:
1 . The Trustee has received (a) from the Company, an executed Initial
Disbursements Certificate and (b) from the Company, an executed Closing
Certification in the form attached to the Disbursement Agreement as EXHIBIT
B-1.
2. The Trustee has received from the Title Insurer the Title Policy,
or a pro pro forma of the Title Policy with a letter agreement from the Title
Insurer agreeing to issue title in the form of such pro forma.
B-8
The foregoing representations, warranties and certifications are true and
correct and you each are entitled to rely on the foregoing in connection with
the Initial Disbursements. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to them in the Disbursement
Agreement.
FIRST UNION BANK OF CONNECTICUT,
as Trustee
By:
Name:
Title:
B-9
EXHIBIT C TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
FORM OF INTEREST DISBURSEMENT REQUEST
First National Bank of Commerce, Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Date: [Draw Date], 1997
This Interest Disbursement Request is delivered to you pursuant to that
certain Cash Collateral and Disbursement Agreement dated August 22, 1996,
between First National Bank of Commerce, as Disbursement Agent, First Union
Bank of Connecticut, as Trustee, and Casino Magic of Louisiana, Corp. (the
"Company") (the "DISBURSEMENT AGREEMENT"). Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to them in the
Disbursement Agreement. Pursuant to SECTION 5.1 of the Disbursement
Agreement, you are hereby directed to liquidate all of the Pledged Securities
(to the extent required) and pay to (the "PAYING AGENT") on February 15, 1997
(the "PAYMENT DATE") $ funds from the Interest Reserve Account maintained by
you in the name of Casino Magic of Louisiana, Corp. The undersigned hereby
certifies that payments in an amount equal to such sums will be due and
payable on the Notes on the Payment Date.
Please confirm the transfer described above by returning a notice of
confirmation to the undersigned at the address set forth above.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
C-1
EXHIBIT D TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
OPERATING DISBURSEMENT REQUEST AND CERTIFICATE
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Operating Disbursement Request No. under Cash Collateral and
Disbursement Agreement Amount Requested: $
Ladies and Gentlemen:
Casino Magic of Louisiana, Corp., a Louisiana corporation (the "COMPANY")
hereby submits this Operating Disbursement Request and Certificate (the
"DISBURSEMENT REQUEST") pursuant to that certain Cash Collateral and
Disbursement Agreement dated August 22, 1996, to which you are a party (the
"DISBURSEMENT AGREEMENT"). Capitalized terms used herein without definition
shall have the meanings assigned in the Disbursement Agreement.
The Company hereby requests that you, in your capacity as
disbursement agent under the Disbursement Agreement disburse $
(the "DISBURSEMENT") from the Operating Reserve account to Account No.
at , (the "DISBURSED FUNDS
ACCOUNT") so that the Company may distribute checks drawn on the Disbursed
Funds Account to pay for certain operating costs.
In connection with the requested Disbursement, the Company represents,
warrants and certifies as follows:
1 . The funds disbursed pursuant to this Disbursement Requested shall be
used [FOR PAYROLL OBLIGATIONS] [TO SATISFY GAMING LOSSES AT CASINO MAGIC -
BOSSIER CITY] [SPECIFY OTHER OPERATING EXPENSES] and for no other purpose.
The funds disbursed pursuant to this Disbursement Request shall in no event be
used to pay for any construction related expenses.
2. There is no Event of Default under the Indenture or the
Disbursement Agreement or any event, omission or a failure of a condition
which would constitute on Event of Default under the Indenture or the
Disbursement Agreement or lapse of time or both.
3. Gaming operations have commenced at the Bossier City Project.
4. All Disbursements previously requested by the Company from
the Operating
D-1
Reserve Account and made by Disbursement Agent, if any, into the Disbursed
Funds Account have been fully disbursed by the Company for such purposes as
certified by the Company in the applicable disbursement request.
The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Disbursement.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
D-2
EXHIBIT E TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
COMPLETION RESERVE DISBURSEMENT REQUEST AND CERTIFICATE
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Completion Reserve Disbursement Request No. under Cash
Collateral and Disbursement Agreement
Amount Requested: $
Ladies and Gentlemen:
Casino Magic of Louisiana, Corp., a Louisiana corporation (the "COMPANY")
hereby submits this Completion Reserve Disbursement Request and Certificate
(the "DISBURSEMENT REQUEST") pursuant to that certain Cash Collateral and
Disbursement Agreement dated August 22, 1996, to which you are a party (the
"DISBURSEMENT AGREEMENT"). Capitalized terms used herein without definition
shall have the meanings assigned in the Disbursement Agreement.
The Company hereby requests that you, in your capacity under the Disbursement
Agreement, authorize disbursement of $ (the
"DISBURSEMENT") from the Completion Reserve Account to the Construction
Disbursement Account so that the Company may use the funds disbursed to
construct the Bossier City Project.
In connection with the requested Disbursement, the Company represents,
warrants and certifies as follows:
1. The funds disbursed pursuant to this requested Disbursement will
not be used in violation of the terms of the Indenture.
2. The funds disbursed pursuant to this Disbursement Request shall be
used, upon disbursement from the Construction Disbursement Account, solely for
the completion of construction of the Bossier City Project and such funds are
reasonably necessary to permit completion of construction of the Bossier City
Project in accordance with the Plans.
E-1
3. The following circumstances resulted in the cost to complete the
Bossier City Project to exceed the Initial Construction Disbursement Budget:
4. The circumstances described in paragraph 3 above were not reasonably
anticipated by the Company in preparing the Initial Construction Disbursement
Budget for the following reasons:
5. After giving effect to the above requested Disbursement, the funds
in the Construction Disbursement Account are sufficient to pay for the
anticipated costs to complete the Bossier City Project in accordance with the
Construction Disbursement Budget, as amended pursuant to the attached
Construction Disbursement Budget Certificate, and the Company does not believe
that any other expenses will need to be incurred by the Company in order to
cause the Bossier City Project to be Operating on or before its Operating
Deadline.
6. There is no Event of Default under the Indenture or the
Disbursement Agreement or any event, omission or failure of a condition which
would constitute an Event of Default under the Indenture or the Disbursement
Agreement after notice or lapse of time or both.
The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Disbursement.
Attached to this Disbursement Request is a certificate from the
Independent Construction Consultant and certificates from the Bellows, ▇▇▇
▇▇▇▇▇ and the Project Architect and a Construction Disbursement Budget
Amendment Certificate.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
E-2
Received and Reviewed:
2ND OPINION, INC.
a Louisiana corporation
By:
Name:
Title:
E-3
EXHIBIT 1 TO EXHIBIT E
CERTIFICATE OF INDEPENDENT CONSTRUCTION CONSULTANT
COMPLETION RESERVE DISBURSEMENT REQUEST
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Completion Reserve Disbursement Request No. Under
the Cash
Collateral and Disbursement Agreement of Casino Magic of Louisiana, Corp.
(the "COMPANY")
Ladies and Gentlemen:
The undersigned (the "INDEPENDENT CONSTRUCTION CONSULTANT") hereby certifies
as
follows:
1. The Independent Construction Consultant has reviewed the above
referenced Disbursement Request and the Cash Collateral and Disbursement
Agreement dated August 22, 1996, to which the Company is a party. Capitalized
terms used herein and not otherwise defined shall have the same meanings as
those set forth in the Cash Collateral and Disbursement Agreement.
2. The Independent Construction Consultant represents, warrants and
certifies that
(a) the funds requested under the Completion Reserve Disbursement Request
are reasonably necessary to permit completion of construction of the Bossier
City Project in accordance with the Plans, (b) after giving effect to the
requested Disbursement, the funds in the Construction Disbursement Account are
sufficient to pay for the anticipated costs to complete the Bossier City
Project in accordance with the Construction Disbursement Budget, as amended,
and the Independent Construction Consultant is not aware at this time of any
other expenses that the Company will need to incur in order to cause the
Bossier City Project to be Operating on or before its Operating Deadline and
(c) the Independent Construction Consultant has no actual knowledge of an
Event of Default under the Indenture or the Disbursement Agreement or any
event, omission or failure of a condition which would constitute an Event of
Default under the Indenture or the Disbursement Agreement after notice or
lapse of time or both.
3. Pursuant to its duties under the Disbursement Agreement and that
certain side letter between the Independent Construction Consultant, the
Company and the Trustee dated as of August 22, 1996, the Independent
Constructor Consultant has inspected the Bossier City Project within the
previous four weeks of the date of this certificate.
E-4
The foregoing representations, warranties and certifications are true and
correct and dsbursement Agent entitled to rely on the foregoing in authorizing
and making the Disbursement.
2ND OPINION, INC.,
a Louisiana corporation
By:
Name:
Title:
E-5
EXHIBIT 2 TO EXHIBIT E
CERTIFICATE OF GENERAL CONTRACTOR
COMPLETION RESERVE DISBURSEMENT REQUEST
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Completion Reserve Disbursement Request No. Under
the Cash
Collateral and Disbursement Agreement of Casino Magic of Louisiana, Corp.
(the "COMPANY")
Ladies and Gentlemen:
The undersigned (the "GENERAL CONTRACTOR") hereby certifies as follows:
1. The General Contractor has reviewed the above referenced
Disbursement Request and the Cash Collateral and Disbursement Agreement dated
August 22, 1996, to which the Company is a party, to the extent necessary to
understand the defined terms contained herein and in the Completion
Disbursement Request that are incorporated by reference from the Cash
Collateral and Disbursement Agreement and to provide the certification
contained herein.
2. The General Contractor hereby represents, warrants and certifies
that (a) the funds requested under the Completion Reserve Disbursement Request
are reasonably necessary to permit completion of construction of the Bossier
City Project in accordance with the Plans and (b) after giving effect to the
requested Disbursement, the funds in the Construction Disbursement Account are
sufficient to pay for the anticipated costs to complete the Bossier City
Project in accordance with the Construction Disbursement Budget, as amended,
and the General Contractor is not aware at this time of any other expenses
that the Company will need to incur in order to cause the Bossier City Project
to be Operating on or before its Operating Deadline.
The foregoing representations, warranties and certifications are true and
correct and Independent Construction Consultant is entitled to rely on the
foregoing in authorizing and making the Disbursement.
E-6
Capitalized terms used herein and not otherwise defined shall have the
meanings scribed to them in the Cash Collateral and Disbursement Agreement
[▇.▇. ▇▇▇▇▇▇▇ CONSTRUCTION CORPORATION] [▇▇▇ ▇▇▇▇▇ CONSTRUCTION
COMPANY]
By:
Name:
Title:
E-7
EXHIBIT 3 TO EXHIBIT E
CERTIFICATE OF PROJECT ARCHITECT
COMPLETION RESERVE DISBURSEMENT REQUEST
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building, 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Completion Reserve Disbursement Request No. Under
the Cash
Collateral and Disbursement Agreement of Casino Magic of Louisiana, Corp.
(the "COMPANY")
Ladies and Gentlemen:
▇▇▇▇▇▇▇▇ design Group, Inc. (the "PROJECT ARCHITECT") hereby certifies as
follows:
1 . The Project Architect has reviewed the above referenced Completion
Disbursement Request and the Cash Collateral and Disbursement Agreement dated
August 22, 1996, to which the Company IS a party, to the extent necessary to
understand the defined terms contained herein and in the Completion
Disbursement Request that are incorporated by reference from the Cash
Collateral and Disbursement Agreement and to provide the certification
contained herein.
2. The Project Architect hereby represents, warrants and certifies
that (a) the funds requested under the Completion Reserve Disbursement Request
are reasonably necessary to permit completion of construction of the Bossier
City Project in accordance with the Plans and (b) after giving effect to the
requested Disbursement, the funds in the Construction Disbursement Account are
sufficient to pay for the anticipated costs to complete the Bossier City
Project in accordance with the Construction Disbursement Budget, as amended,
and the Project Architect is not aware at this time of any other expenses that
the Company will need to incur in order to cause the Bossier City Project to
be Operating on or before its Operating Deadline.
The foregoing representations, warranties and certifications are true and
correct and Independent Construction Consultant is entitled to rely on the
foregoing in authorizing and making the Disbursement.
E-8
Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed to them in the Cash Collateral and Disbursement Agreement
▇▇▇▇▇▇▇▇ DESIGN GROUP, INC., a
Missouri Corporation
By:
Name:
Title:
E-9
EXHIBIT F TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
CONSTRUCTION DISBURSEMENT REQUEST AND CERTIFICATE
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building, 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Construction Disbursement Request No. - under Cash
Collateral and Disbursement Agreement Amount Requested: $
Ladies and Gentlemen:
Casino Magic of Louisiana, Corp., a Louisiana corporation (the "COMPANY")
hereby submits this Construction Disbursement Request and Certificate (the
"DISBURSEMENT REQUEST") pursuant to that certain Cash Collateral and
Disbursement Agreement dated August 22, 1996, to which you are a party (the
"DISBURSEMENT AGREEMENT"). Capitalized terms used herein without definition
shall have the meanings assigned in the Disbursement Agreement.
The Company hereby requests that you, in your capacity under the Disbursement
Agreement,
authorize the Disbursement Agent to make a disbursement of $ for ▇▇▇ ▇▇▇▇▇
Hard
Costs, $ for Bellows Hard Costs and $ for Soft Costs (the
"DISBURSEMENT") from the Construction Disbursement Account to Account No.
at (the "DISBURSED FUNDS ACCOUNT"), so that the
Company may distribute checks drawn
on the Disbursed Funds Account to the parties identified on SCHEDULE 1
attached hereto and in the
respective amounts listed for such parties on SCHEDULE 1.
In connection with the requested Disbursement, the Company represents,
warrants and CERTIFIES
1 . Schedule 1 accurately lists each party for whom payment is requested
and a description of the purpose of such payment, specifying the line item
relating to each such payment. In the event that any Advance Disbursements
have been made and have not otherwise been documented as required hereunder,
Schedule I also includes each party to whom payment was made from such Advance
Disbursement and a description of the purpose of such payments specifying the
line item relating to each such payment. The information set forth in
Schedule I is true, correct and complete.
F-1
2. [FOR HARD COST DISBURSEMENTS ONLY] The Company has delivered to
the Independent Construction Consultant (a) duly executed conditional lien
releases from all contractors, subcontractors, suppliers and materialmen
having provided work, materials and/or services constituting completed
construction or stored materials relating to the Bossier City Project (except
as to Retainage Amounts and such amounts as the Independent Construction
Consultant determines to have been reasonably withheld) for all Disbursements
identified on this Disbursement Request and (b) duly executed acknowledgments
of payment and unconditional (except as to Retainage Amounts) lien releases,
in form and substance satisfactory to Independent Construction Consultant,
from all payees identified on the previous Disbursement Request for payment of
Hard Costs and acknowledging the receipt by such payee of all sums payable to
such Contractor from previous Disbursement Requests (except as to Retainage
Amounts and such amounts as Disbursement Agent determines to have been
reasonably withheld).
3. The Construction Disbursement Budget presently in effect for the
Bossier City Project is dated and includes all
amendments through Construction Disbursement Budget Amendment No. .
Said Construction Disbursement Budget accurately sets forth the anticipated
Construction through the date that the Bossier City Project is Operating.
4. After giving effect to the requested disbursement from the
Construction Disbursement Account and the payments contemplated from the
Disbursed Funds Account in connection therewith, and, in the event any Advance
Disbursements have been made and have not otherwise been documented as
required, such Advance Disbursement from the Construction Disbursement
Account, there are sufficient Available Funds to pay for the anticipated costs
described in paragraph 3 above (and the component parts thereof) in accordance
with the aggregate amounts (and line items) set forth in the Construction
Disbursement Budget, and the Company does not believe that any other expenses
will need to be paid or incurred by the Company in order to cause the Bossier
City Project to be Operating on or before its Operating Deadline.
5. There is no Event of Default under the Indenture or the
Disbursement Agreement or any event, omission or failure of a condition which
would constitute an Event of Default under the Indenture or the Disbursement
Agreement after notice or lapse of time or both.
6. [FOR HARD COST DISBURSEMENTS ONLY] As of the date hereof, the
Company has submitted to the Independent Construction Consultant all Plans
applicable to the Disbursement requested herein which, as of the date hereof,
constitute Final Plans. The construction performed as of the date hereof is
in accordance with the Plans for the Bossier City Project and the disbursement
is appropriate in light of the percentage of construction completed and the
amount of stored materials. Further, all disbursements requested under this
Disbursement Request are for the Payment of Construction Expenses incurred for
work consistent with Plans which the Company reasonably believes ultimately
will become Final Plans and which will permit the Company to complete
construction of the Bossier City Project on or before the Operating Deadline.
7. All Disbursements previously requested by Company and made by
Disbursement Agent into the Disbursed Funds Account have been disbursed by the
Company in substantially the manner certified by the Company in the applicable
Construction Disbursement Request .
8. The Company has delivered to the Independent Construction
Consultant copies of all Contracts for the Bossier City Project with payment
obligations of at least Fifty Thousand ($50,000)
F-2
and, with respect to each such Contract: (i) a consent to collateral
assignments in the form attached hereto as EXHIBIT Jsigned by the
third-party Contractor under each such Contract; and (ii) copies of such
performance and payment bonds (naming the Company and Trustee as additional
insureds), if any, as the Company may require to be provided to the Company
pursuant to any Contract.
9. [FOR DISBURSEMENTS IMMEDIATELY FOLLOWING COMPLETION OF ANY
FOUNDATION FOR ANY BUILDING WITHIN THE BOSSIER CITY PROJECT] The Company shall
have delivered to the Independent Construction Consultant, on a building by
building basis, a foundation endorsement from the Title Company insuring that
the foundations for each building within the Bossier City Project are
constructed wholly within the boundaries of the Property then owned in fee
simple by the Company and does not encroach on any easements or violate any
covenants, conditions or restrictions of record.
The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Disbursement.
[FOR HARD COST DISBURSEMENTS ONLY] Attached to this Disbursement Request
are certificate(s) from the ▇▇▇ ▇▇▇▇▇, for ▇▇▇ ▇▇▇▇▇ Hard Costs, if any,
Bellows for Bellows Hard Costs, if any, and the Project Architect.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
Received and Reviewed:
2ND OPINION, INC.,
a Louisiana corporation
By:
Name:
Title:
F-3
SCHEDULE 1 TO DISBURSEMENT REQUEST AND CERTIFICATE
[attach form]
F-4
EXHIBIT 1 TO EXHIBIT F
CERTIFICATE OF INDEPENDENT CONSTRUCTION CONSULTANT
(DISBURSEMENT REQUEST FOR CONSTRUCTION EXPENSES)
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Disbursement Request No. Under Cash Collateral and
Disbursement
Agreement of Casino Magic of Louisiana, Corp. (the "COMPANY")
Ladies and Gentlemen:
The undersigned (the "INDEPENDENT CONSTRUCTION CONSULTANT") hereby certifies
as follows:
1. The Independent Construction Consultant has reviewed the above
referenced Disbursement Request and the Cash Collateral and Disbursement
Agreement dated August 22, 1996, to which the Company is a party. All
capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Cash Collateral and Disbursement Agreement.
2. [HARD COSTS ONLY] The Independent Construction Consultant has
received from the Company all Plans applicable to the Disbursement requested
pursuant to the Disbursement Request and, in the Independent Construction
Consultant's professional opinion, the construction performed as of the date
hereof is in accordance with the Plans and the disbursement is appropriate in
light of the percentage of construction completed and the amount of stored
materials. Further, all disbursements requested under this Disbursement
Request are from the Payment of Hard Costs incurred for work consistent with
Plans which will pen-nit the Company to complete construction of the Bossier
City Project on or before the Operating Deadline.
3. The Independent Construction Consultant has reviewed all
disbursements made from the Construction Disbursement Account and compared the
documentation supporting the disbursements with the Construction Disbursement
Budget category and confirms that the total disbursements to date in such
category do not exceed the budgeted amount for such category.
4. The Independent Construction Consultant does not dispute the
appropriateness of any item or items the value of which exceeds One-Hundred
Thousand Dollars ($100,000) funded with the proceeds of a previous
Construction Disbursement Request.
5. The Construction Disbursement Budget accurately sets forth the
anticipated costs of
Completion of the Bossier City Project through the date that the Bossier City
Project is Operating.
6. After giving effect to the requested disbursement from the
Construction Disbursement
F-5
Account and the payments contemplated from the Disbursed Funds Account in
connection therewith, there are sufficient Available Funds to pay for the
anticipated costs to complete construction of the Bossier City Project (and
component parts thereof) in accordance with the aggregate amounts (and line
items set forth in the Construction Disbursement Budget), and the Independent
Construction Consultant is not aware of any other expenses that will be needed
to be paid or incurred by the Company in order to cause the Bossier City
Project to be Operating on or before its Operating Deadline.
7. Pursuant to its duties under the Disbursement Agreement and that
certain side letter from the Independent Construction Consultant in favor of
the Company and the Trustee, the Independent Construction Consultant has
inspected the Bossier City Project within the previous four weeks of the date
of this certificate.
8. [FINAL DISBURSEMENT ONLY] The Bossier City Project is complete in
accordance with the Plans and all applicable building laws, ordinances and
regulations and was Operating on or before April 30, 1997, and continues to be
Operating as of the date hereof.
9. [FOR HARD COSTS ONLY] The Independent Construction Consultant has
received (a) duly executed conditional lien releases from all contractors,
subcontractors, suppliers and materialmen having provided work, materials
and/or services constituting completed construction or stored materials
relating to the Bossier City Project (except as to Retainage Amounts and such
amounts as the Independent Construction Consultant determines to have been
reasonable withheld) for all Disbursements identified on the Disbursement
Request and (b) duly executed acknowledgments of payment and unconditional
(except as to Retainage Amounts) lien releases, in form and substance
satisfactory to Independent Construction Consultant, from all payees
identified on the previous Disbursement Request for payment of Hard Costs and
acknowledging the receipt by such payee of all sums payable to such Contractor
from previous Disbursement Requests (except as to Retainage Amounts and such
amounts as Disbursement Agent determines to have been reasonably withheld).
10. The Independent Construction Consultant has received from the
Company copies of all Contracts for the Bossier City Project with payment
obligations of at least Fifty Thousand Dollars (50,000) and, with respect to
each such Contract: (i) a consent to collateral assignments in the
formattached hereto as EXHIBIT Jsigned by the third-party Contractor under
each such Contract; and (ii) copies of such performance and payment bonds
(naming the Company and Trustee as additional insureds), if any, as the
Company may require to be provided to the Company pursuant to any Contract.
11. [FOR DISBURSEMENTS IMMEDIATELY FOLLOWING COMPLETION OF ANY
FOUNDATION FOR ANY BUILDING WITHIN THE BOSSIER CITY PROJECT] The Independent
Construction Consultant shall have received a copy of a foundation
endorsement, on a building by building basis, from the Title Company insuring
that the foundations for each building within the Bossier City Project are
constructed wholly within the boundaries of the Property then owned in fee
simple by the Company and that such foundation(s) does not encroach on any
easements or violate any covenants, conditions or restrictions of record.
F-6
The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Disbursement.
2ND OPINION, INC.,
a Louisiana corporation
By:
Name:
F-7
EXHIBIT 2 TO EXHIBIT F
CERTIFICATE OF GENERAL CONTRACTOR
(DISBURSEMENT REQUEST FOR CONSTRUCTION EXPENSES)
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Disbursement Request No. Under Cash Collateral and
Disbursement
Agreement of Casino Magic of Louisiana Corp. (the "COMPANY")
Ladies and Gentlemen:
[▇.▇. ▇▇▇▇▇▇▇ Construction Corporation][▇▇▇ ▇▇▇▇▇ Construction Company] (the
"GENERAL
CONTRACTOR") hereby certifies as follows:
1. The General Contractor has reviewed the above referenced Disbursement
Request and
the Cash Collateral and Disbursement Agreement dated , 1996,
to which the Company is a party, to the extent necessary to understand the
defined terms contained herein and in the Disbursement Request that are
incorporated by reference from the Cash Collateral and Disbursement Agreement
and to provide the certification contained herein.
2. The General Contractor hereby certifies and confirms the accuracy
of the certifications in paragraphs 1, 2, 3, 4, and 6 of the above-referenced
Disbursement Request.
3. The General Contractor hereby certifies that to the best of its
knowledge, the Bossier City Project may be constructed in accordance with its
Construction Disbursement Budget presently in effect.
The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Disbursement.
F-8
Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed to them in the Cash Collateral and Disbursement Agreement.
[▇.▇. ▇▇▇▇▇▇▇ CORPORATION] [▇▇▇ ▇▇▇▇▇ CONSTRUCTION COMPANY]
By:
Name:
Title:
F-9
EXHIBIT 3 TO EXHIBIT F
CERTIFICATE OF PROJECT ARCHITECT
(DISBURSEMENT REQUEST )
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Disbursement Request No. Under Cash Collateral and
Disbursement
Agreement of Casino Magic of Louisiana Corp. (the "COMPANY")
Ladies and Gentlemen:
▇▇▇▇▇▇▇▇ design Group, Inc. (the "PROJECT ARCHITECT") hereby certifies as
follows:
1. The Project Architect has reviewed the above referenced ' Cash
Collateral and Disbursement Agreement dated August 22, 1996, to which the
Company is a party to the extent necessary to understand the defined terms
contained herein and in the Disbursement Request that are incorporated by
reference from the Cash Collateral and Disbursement Agreement and to provide
the certification contained herein.
2. The Project Architect hereby certifies and confirms the accuracy
of the certifications contained in paragraphs 1, 2, 3, 4, and 6 of the
above-referenced Disbursement Request.
3. The Project Architect hereby certifies that to the best of its
knowledge, the Bossier City Project may be constructed in accordance with its
Construction Disbursement Budget presently in effect.
The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Disbursement.
F-10
Capitalized terms used herein and not otherwise defined shall have the
meaning ascribed to them in the Cash Collateral and Disbursement Agreement.
▇▇▇▇▇▇▇▇ DESIGN GROUP, INC., a
Missouri Corporation
By:
Name:
Title:
Title:
F-11
EXHIBIT F-2 TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
ADVANCE DISBURSEMENT REQUEST AND CERTIFICATE
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Advance Disbursement Request No. Under Cash
Collateral
and Disbursement Agreement
Amount Requested: $
Ladies and Gentlemen:
Casino Magic of Louisiana, Corp. a Louisiana corporation (the "Company")
hereby submits this Advance Disbursement Request and Certificate (the
"Disbursement Request") pursuant to that certain Cash Collateral and
Disbursement Agreement dated August 22, 1996 to which you are a party (the
"Disbursement Agreement"). Capitalized terms used herein without definition
shall have the meanings assigned in the Disbursement Agreement.
The Company hereby requests that you, in your capacity under the Disbursement
Agreement, authorize the disbursement Agent to make a disbursement of $
[amount not to exceed $250,000] from the Construction Disbursement
Account to Account No.
At (the "Disbursed Funds
Account").
The Company hereby represents, warrants and certifies that (a) amounts
disbursed pursuant to this Disbursement Request shall be used solely for the
payment of Soft Costs and/or deposits for the purchase of equipment for the
Bossier City Project, (b) there is no Event of Default under the Indenture of
the Disbursement Agreement or any event, omission or failure of a condition
which would constitute an Event of Default under the Indenture or the
Disbursement Agreement after notice or lapse of time or both, (c) in the event
that any Advance Disbursements have previously been made, the Company has
provided the same supporting documentation as is required under the
Disbursement Agreement with respect to other Construction Disbursement
Requests within 15 days after such Advance Disbursement was made and (d) the
amount of the requested Disbursement hereunder together with Advance
Disbursements previously made to the Company which have not otherwise been
documented as required in subsection (c) hereof, do not exceed the amount of
$250,000.
F-12
The foregoing representations, warranties and certifications are true and
correct and the Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the disbursement.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
F-13
EXHIBIT G TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT CERTIFICATE
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Casino Magic of Louisiana, Corp.
Amendment No. to Construction Disbursement
Budget for Bossier City Project
Ladies and Gentlemen:
Casino Magic of Louisiana, Corp., a Louisiana corporation ("THE COMPANY")
requests that the Construction Disbursement Budget for the Bossier City
Project (the "CONSTRUCTION DISBURSEMENT BUDGET") be amended as set forth on
SCHEDULE 1 to this certificate. This certificate is delivered pursuant to
that certain Cash Collateral and Disbursement Agreement dated August 22, 1996
(the "DISBURSEMENT AGREEMENT"), to which you are a party. Capitalized terms
used in this certificate that are otherwise not defined shall have the meaning
assigned in the Disbursement Agreement. In connection with the requested
Construction Disbursement Budget amendment, the Company hereby represents,
warrants and certifies as follows:
1. The proposed amendment is set forth in SCHEDULE 1 hereto,
2. The following circumstances resulted in the reasonable necessity
of the proposed amendment:
3. The circumstances described in paragraph 3 above were not
reasonably anticipated by the Company in preparing the Construction
Disbursement Budget for the following reasons:
G-1
4. The Construction Disbursement Budget in effect immediately prior
to the proposed amendment is attached to this Construction Disbursement Budget
Amendment Certificate as SCHEDULE 2,and the Construction Disbursement Budget
which will be in effect upon effectiveness of the proposed amendment is
attached to this Construction Disbursement Budget Amendment as SCHEDULE 3.
5. immediately following the proposed amendment: (i) the Construction
Disbursement Budget will include all costs to be incurred in causing the
Bossier City Project to be Operating; (ii) the funds in the Construction
Disbursement Account will be sufficient to cause the Bossier City Project to
be Operating (and the component parts hereof) in accordance with the aggregate
amounts (and line items) set forth in the Construction Disbursement Budget.
6. [If any line item on the Construction Disbursement Budget is
reduced] The work represented by the line item entitled will
be completed for a total cost of $. , which amount is less than $
[should correspond to $ amount set forth in the Construction
Disbursement Budget prior to proposed amendment] and such savings will be
reallocated, pursuant to the amendment to another line item.
7. The construction performed as of the date hereof is in accordance
with the Plans. The undersigned have no reason to believe that the date on
which the Bossier City Project will become Operating will not occur on or
prior to its Operating Deadline.
8. There is no Event of Default under the Indenture or the
Disbursement Agreement any event, omission or failure of a condition which
could constitute an Event of Default under the Indenture or the Disbursement
Agreement after notice or lapse of time or both.
The undersigned certifies that the Construction Disbursement Budget
amendment contemplated hereby is permitted pursuant to the Disbursement
Agreement and the Indenture, and all conditions precedent thereto have been
met.
G-2
Attached to this Construction Disbursement Budget Amendment Certificate
are certificates from the Independent Construction Consultant, the Project
Architect, Bellows and ▇▇▇ ▇▇▇▇▇.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
Received and Reviewed:
2ND OPINION, INC.,
a Louisiana corporation
By:
Name:
Title:
G-3
SCHEDULE 1 TO CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT
Amendment No. - to Construction Disbursement Budget.
1. Increases to Line Items:
The following line item is increased:
Old Amount of Line Item:
Amount of Increase:
New Total For Line Item:
Source of Funds For Increase:
Amount
Source
Realized Savings
Additional Revenue
Allocation of Funds from
Completion Reserve Account
Total
II. Decreases to Line Items:
The following line item is decreased:
Old Amount of Line Item:
Amount of Decrease:
New Amount of Line Item:
Reason For Decrease of Line Item:
Realized Savings
III. New Construction Disbursement Budget Totals
a. The total Construction Disbursement Budget for the
Bossier City Project is now: $
b. The amount disbursed to date for the
Bossier City Project is now: $
c. Remaining amounts to be spent: $
d. Available Funds for the Bossier City
Project: $
G-4
Item d should be greater than or equal to item c.
G-5
SCHEDULE 2 TO CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT CERTIFICATE
EXISTING CONSTRUCTION DISBURSEMENT BUDGET'
1 (OR PORTION THEREOF BEING AMENDED)
G-6
SCHEDULE 3 TO CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT CERTIFICATE
REVISED CONSTRUCTION DISBURSEMENT BUDGET
G-7
EXHIBIT 1 TO EXHIBIT G
CERTIFICATE OF INDEPENDENT CONSTRUCTION CONSULTANT
CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Construction Disbursement Budget Amendment Certificate dated
1
199- of Casino Magic of Louisiana, Corp. (the "COMPANY")
Ladies and Gentlemen:
2nd Opinion, Inc. (the "INDEPENDENT CONSTRUCTION CONSULTANT") hereby certifies
as follows:
1. The Independent Construction Consultant has reviewed the above
referenced Construction Disbursement Budget Amendment Certificate and the Cash
Collateral and Disbursement Agreement dated August 22, 1996, to which the
Company is a party (the "Disbursement Agreement"). Capitalized terms used
herein and not otherwise defined shall have the meanings ascribed to them in
the Disbursement Agreement.
2. The Independent Construction Consultant hereby certifies and
confirms the accuracy of the certifications in paragraphs 1, 4, 5, 6 and 7 of
the above-referenced Construction Disbursement Budget Amendment Certificate.
The foregoing representations, warranties and certifications are true and
correct and the Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the amendment to the Construction Disbursement Budget.
2ND OPINION, INC.,
a Louisiana corporation
By:
Name:
Title:
G-8
EXHIBIT 2 TO EXHIBIT G
CERTIFICATE OF GENERAL CONTRACTOR
CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2nd Opinion, Inc., as
Independent Construction Consultant
▇▇ ▇▇▇ ▇▇▇▇▇
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Re: Construction Disbursement Budget Amendment Certificate dated
199- of Casino Magic of Louisiana, Corp. (the "COMPANY")
Ladies and Gentlemen:
The undersigned (the "GENERAL CONTRACTOR") hereby certifies as follows:
1. The General Contractor has reviewed the above referenced
Construction Disbursement Budget Amendment Certificate and the Cash Collateral
and Disbursement Agreement dated August 22, 1996, to which the Company is a
party, to the extent necessary to understand the defined terms contained
herein and in the Construction Disbursement Budget Amendment Certificate that
are incorporated by reference from the Cash Collateral and Disbursement
Agreement, and to provide the certification contained herein.
2. The General Contractor hereby certifies and confirms that with
respect to that portion of the amendment relating to [▇▇▇ ▇▇▇▇▇] [Bellows]
Hard Costs, the accuracy of the certifications in paragraphs 1, 4, 5, 6 and 7
of the above-referenced Construction Disbursement Budget Amendment
Certificate.
The foregoing representations, warranties and certifications are true and
correct and the Disbursement Agent and the Independent Construction Consultant
are entitled to rely on the foregoing in authorizing and making the amendment
to the Construction Disbursement Budget.
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Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed to them in the Disbursement Agreement.
[▇.▇. ▇▇▇▇▇▇▇ CONSTRUCTION CORPORATION] [▇▇▇ ▇▇▇▇▇ CONSTRUCTION
COMPANY]
By:
Name:
Title:
G-10
EXHIBIT 3 TO EXHIBIT G
CERTIFICATE OF PROJECT ARCHITECT
CONSTRUCTION DISBURSEMENT BUDGET AMENDMENT
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
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2nd Opinion, Inc., as
Independent Construction Consultant
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Re: Construction Disbursement Budget Amendment Certificate dated
199- of Casino Magic of Louisiana, Corp. (the "COMPANY")
Ladies and Gentlemen:
▇▇▇▇▇▇▇▇ design Group, Inc. (the "PROJECT ARCHITECT") hereby certifies as
follows:
1. The Project Architect has reviewed the above referenced Cash
Collateral and Disbursement Agreement dated August 22, 1996, to which the
Company is a party to the extent necessary to understand the defined terms
contained herein and in the Construction Disbursement Budget Amendment
Certificate that are incorporated by reference from the Cash Collateral and
Disbursement Agreement and to provide the certification contained herein.
2. The Project Architect hereby certifies and confirms that with
respect to that portion of the amendment relating to Hard Costs, the accuracy
of the certifications contained in paragraphs 1, 4, 5, 6 and 7 of the
above-referenced Construction Disbursement Budget Amendment Certificate.
The foregoing representations, warranties and certifications are true and
correct and the Disbursement Agent and the Independent Construction Consultant
are entitled to rely on the foregoing relative to the amendment to the
Construction Disbursement Budget.
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Capitalized terms used herein and not otherwise defined shall have the
meaning ascribed to them in the Disbursement Agreement.
▇▇▇▇▇▇▇▇ DESIGN GROUP, INC., a
Missouri Corporation
By:
Name:
Title:
G-12
EXHIBIT H TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
CONTRACT AMENDMENT CERTIFICATE
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
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2nd Opinion, Inc., as
Independent Construction Consultant
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Re: Casino Magic of Louisiana, Corp. (the "COMPANY") Amendment No.
to Contract dated between the Company
("CONTRACT")
and (the "CONTRACTOR")
Ladies and Gentlemen:
The Company requests that the above-referenced Contract be amended as set
forth onSCHEDULE 1to this certificate. This certificate is delivered
pursuant to that certain Cash Collateral and Disbursement Agreement dated
August 22, 1996 (the "DISBURSEMENT AGREEMENT"), to which you are a party.
Capitalized terms used in this certificate that are otherwise not defined
shall have the meaning assigned in the Disbursement Agreement. In connection
with the requested Contract amendment, the Company hereby represents, warrants
and certifies as follows:
1 . After giving effect to such amendment (and any related amendment
to the Construction
Disbursement Budget for the Bossier City Project):
(a) Such Construction Disbursement Budget will continue to call for
construction
of improvements constituting the Bossier City Project;
(b) If the amendment will effect a reduction in the scope of the work
to be performed by Contractor, then the work eliminated from the scope of work
either (i) is not necessary to complete the Bossier City Project, or (ii) to
the extent necessary for the completion of the Bossier City Project, will be
completed by the contractors set forth below under the new or amended
contracts described below. Each such contractor is competent to perform the
work called for by the new or amended contract in exchange for the payments
contemplated thereby.
Work Contractor
Contract
H-1
(c) The Company will continue to be able to complete the work within
the line items pertaining to the Contract: (i) in a timely manner so as to
permit the date on which the Bossier City Project becomes Operating to occur
on or prior to its Operating Deadline; and (ii) within the aggregate amounts
specified for the line item on its Construction Disbursement Budget.
2. There is no Event of Default under the Indenture or the
Disbursement Agreement or any event, omission or failure of a condition which
could constitute an Event of Default under the Indenture or the Disbursement
Agreement after notice or lapse of time or both.
The undersigned certifies that this Contract Amendment Certificate is
authorized hereby is permitted pursuant to the Disbursement Agreement and the
Indenture, and all conditions precedent thereto have been met.
Attached to this Contract Amendment Certificate is a certificate from the
Independent Construction Consultant [FOR CONTRACTS RELATING TO HARD COSTS
ONLY] [and a certificate from each of Bellows, ▇▇▇ ▇▇▇▇▇ and the Project
Architect].
CASINO MAGIC OF LOUISIANA, CORP.
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
Received and Reviewed:
2ND OPINION, INC.,
a Louisiana corporation
By:
Name:
Title:
H-2
SCHEDULE 1 TO CONTRACT AMENDMENT CERTIFICATE
(COPY OF EXECUTED CONTRACT AMENDMENT)
H-3
EXHIBIT I TO EXHIBIT H
CERTIFICATE OF INDEPENDENT CONSTRUCTION CONSULTANT
CONTRACT AMENDMENT
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
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Re: Casino Magic of Louisiana, Corp. (the "COMPANY") Amendment No.
to Contract dated (the "CONTRACT") between the Company
and ("CONTRACTOR")
Ladies and Gentlemen:
2nd Opinion, Inc. (the "INDEPENDENT CONSTRUCTION CONSULTANT") hereby certifies
as follows:
1 . The Independent Construction Consultant has reviewed the above
referenced Contract Amendment Certificate and the Cash Collateral and
Disbursement Agreement dated August 22, 1996, to which the Company is a party.
Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed to them in the Cash Collateral and Disbursement Agreement.
2. The Independent Construction Consultant hereby certifies and
confirms the accuracy of the certifications in paragraph I of the
above-referenced Contract Amendment Certificate.
The foregoing representations, warranties and certifications are true and
correct and the Disbursement Agent is entitled to rely on the foregoing
relative to the amendment to the Contract.
2ND OPINION, INC.,
a Louisiana corporation
By:
Name:
Title:
H-4
EXHIBIT 2 TO EXHIBIT H
CERTIFICATE OF GENERAL CONTRACTOR
CONTRACT AMENDMENT
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
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2nd Opinion, Inc., as
Independent Construction Consultant
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Re: Casino Magic of Louisiana Corp. (the "COMPANY") Amendment No.
to Contract dated (the "CONTRACT") between the Company
and ("CONTRACTOR")
Ladies and Gentlemen:
The undersigned (the "GENERAL CONTRACTOR") hereby certifies as follows:
1. The General Contractor has reviewed the above referenced Contract
Amendment
Certificate and the Cash Collateral and Disbursement Agreement dated 1996,
to which the Company is a party, to the extent necessary to understand the
defined terms contained herein and in the Contract Amendment Certificate that
are incorporated by reference from the Cash Collateral and Disbursement
Agreement, and to provide the certification contained herein.
2. The General Contractor hereby certifies and confirms the accuracy of
the certifications in paragraph I of the above-referenced Contract Amendment
Certificate, as such certifications relate to [▇▇▇ ▇▇▇▇▇] [Bellows] Hard
Costs.
The foregoing representations, warranties and certifications are true and
correct and the Independent Construction Consultant and the Disbursement Agent
are entitled to rely on the foregoing relative to the amendment to the
Contract.
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Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed to them in the Cash Collateral and Disbursement Agreement.
[▇.▇. ▇▇▇▇▇▇▇ CONSTRUCTION CORPORATION] [▇▇▇ ▇▇▇▇▇ CONSTRUCTION
COMPANY]
By:
Name:
Title:
H-6
EXHIBIT 3 TO EXHIBIT H
CERTIFICATE OF PROJECT ARCHITECT
CONTRACT AMENDMENT
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
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2nd Opinion, Inc., as
Independent Construction Consultant
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Re: Casino Magic of Louisiana Corp. (the "COMPANY") Amendment No. to
Contract dated (the "CONTRACT") between the Company
and ("CONTRACTOR")
Ladies and Gentlemen:
▇▇▇▇▇▇▇▇ design Group, Inc. (the "PROJECT ARCHITECT") hereby certifies as
follows:
1. The Project Architect has reviewed the above referenced Contract
Amendment
Certificate and the Cash Collateral and Disbursement Agreement dated 5
1996, to which the Company is a party to the extent necessary to understand
the defined terms contained herein and in the Contract Amendment Certificate
that are incorporated by reference from the Cash Collateral and Disbursement
Agreement, and to provide the certification contained herein.
2. The Project Architect hereby certifies and confirms the accuracy of the
certifications contained in paragraph I of the above-referenced Contract
Amendment Certificate, as such certifications relate to Hard Cost.
The foregoing representations, warranties and certifications are true and
correct and Independent Construction Consultant and Disbursement Agent are
entitled to rely on the foregoing relative to the amendment to the Contract.
H-7
Capitalized terms used herein and not otherwise defined shall have the
meaning ascribed to them in the Cash Collateral and Disbursement Agreement.
▇▇▇▇▇▇▇▇ DESIGN GROUP, INC., a
Missouri Corporation
By:
Name:
Title:
H-8
EXHIBIT I TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
ESCROW DISBURSEMENT REQUEST AND CERTIFICATE
[Date]
First National Bank of Commerce, as
Disbursement Agent
Corporate Trust Division
Commerce Building 16th Floor
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Re: Escrow Disbursement Request No. under
Cash Collateral and Disbursement Agreement
Amount Requested: $
Ladies and Gentlemen:
Casino Magic of Louisiana, Corp., a Louisiana corporation (the "COMPANY")
hereby submits this Escrow Disbursement Request and Certificate (the
"DISBURSEMENT REQUEST") pursuant to that certain Cash Collateral and
Disbursement Agreement dated August 22, 1996, to which you are a party (the
"DISBURSEMENT AGREEMENT"). Capitalized terms used herein without definition
shall have the meanings assigned in the Disbursement Agreement.
The Company hereby requests that you, in your capacity as disbursement
agent under the Disbursement Agreement disburse $
(the "DISBURSEMENT") from the Escrow
Account to Account No. at , (the
"DISBURSED FUNDS ACCOUNT").
In connection with the requested Disbursement, the Company represents,
warrants and certifies as follows:
1. The voters of both Bossier Parish and Caddo Parish have approved
the continuation of riverboat gaming pursuant to the Louisiana Referendum and
attached hereto is a copy of a letter of counsel to the Company confirming
such fact.
2. The Company will use all funds disbursed pursuant to this
Disbursement pursuant to the requirements of SECTION 4.10 of the Indenture.
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The foregoing representations, warranties and certifications are true and
correct and Disbursement Agent is entitled to rely on the foregoing in
authorizing and making the Disbursement.
CASINO MAGIC OF LOUISIANA, CORP.,
a Louisiana corporation
By:
Name:
Title:
By:
Name:
Title:
I-2
EXHIBIT J TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
FORM OF CONSENT TO COLLATERAL ASSIGNMENT OF CONTRACT
THIS CONTRACTING PARTY'S CONSENT TO ASSIGNMENT (the "Consent") is made as
of , 199_, by , a corporation
(the "CONTRACTING PARTY"), whose address is , for the benefit of
First
Union Bank of Connecticut, as trustee for the benefit of the holders of the
Notes (the "TRUSTEE"), whose address is ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇. ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 061033690, Attention: Corporate
Trust Department.
RECITALS
A. NOTES. Pursuant to that certain Indenture dated as of August
22, 1996, by and among Casino Magic of Louisiana, Corp., a Louisiana
corporation, as issuer, (the "COMPANY"), , and Jefferson Casino Corp. a
Louisiana corporation (the "GUARANTOR") as guarantor, and the Trustee, as
trustee (the "INDENTURE"), the Company has issued $115,000,000 principal
amount of its First Mortgage Notes due 2003 with Contingent Interest (the
"SERIES A Notes" and, together with the Series B Notes issued in exchange
therefor, the "NOTES"). All defined terms used herein and not otherwise
defined, shall have the meanings set forth in the Indenture. The proceeds of
the Notes, minus certain debt financing costs, have been deposited into an
escrow account maintained by Disbursement Agent ("DISBURSEMENT AGENT")
pursuant to a Cash Collateral and Disbursement Agreement ("CASH COLLATERAL
AGREEMENT") of even date with the Indenture among First National Bank of
Commerce, as Disbursement Agent (the "DISBURSEMENT AGENT"), the Trustee and
the Company.
B. SECURITY.The Company must use the proceeds of the Notes disbursed
pursuant to the Cash Collateral and Disbursement Agreement for the
construction of the Bossier City Project (as defined in the Disbursement
Agreement). Contracting Party and the Company. are parties to that certain
[NAME CONTRACT] dated as
of , 1996 (the "CONTRACT")
relating to the construction or operation of the Bossier City Project. The
Company. has executed a Collateral Assignment collaterally assigning all of
the Company's right, title and interest in and to, among other things, the
Contract (the "COLLATERAL ASSIGNMENT"), dated of even date with the Indenture,
in favor of Trustee, in order to secure the obligations of the Company under,
among other documents, the Notes, the Guarantees and the Indenture (the
"OBLIGATIONS").
CONSENT
NOW THEREFORE, for good and valuable consideration, receipt of which is
hereby
acknowledged, Contracting Party agrees as follows:
1. CONSENT TO ASSIGNMENT. Pursuant to the Contract, Contracting
Party has performed or supplied, or agreed to perform or supply, certain
services, materials or documents in connection with the Bossier City Project.
Contracting Party hereby consents to the assignment thereof by the Company to
Trustee as provided in the Collateral Assignment and this Consent.
2. THE COMPANY'S DEFAULT UNDER CONTRACT. If the Company
defaults under the
J-1
Contract, before exercising any remedy, Contracting Party shall deliver to
Trustee at its address set forth above, by registered or certified mail,
postage prepaid, return receipt requested, written notice of such default,
specifying the nature of the default and the steps necessary to cure the same.
If the Company fails to cure the default within the time permitted under the
Contract, then Trustee shall have an additional 30 days after the expiration
of the time permitted under the Contract (but in no event less than an
additional 30 days after the receipt by Trustee of said notice from
Contracting Party) within which Trustee shall have the right, but not the
obligation, to cure such default. Contracting Party's delivery of such a
notice of default to Trustee and their failure to cure the same within the
said additional period shall be conditions precedent to the exercise of any
right or remedy of Contracting Party arising by reason of such default, except
that Contracting Party shall not be required to continue performance under the
Contract for the said additional period, unless and until Trustee agrees to
pay Contracting Party for that portion of the work, labor and materials
rendered during the said period.
3. COMPANY'S DEFAULT UNDER OBLIGATIONS. If Trustee gives written
notice to Contracting Party that the Company. has defaulted under the
Obligations and requests that Contracting Party continue its performance under
the Contract, Contracting Party shall thereafter perform for Trustee under the
Contract in accordance with its terms, so long as Contracting Party shall be
paid pursuant to the Contract for all work, labor and materials rendered
thereunder, including payment of any sums due to Contracting Party for work
performed up to and including the date of the Company's default.
4. PERFORMANCE FOR TRUSTEE.If Trustee (a) cures any default by the
Company pursuant to Paragraph 2 above, (b) gives written notice to Contracting
Party that the Company has defaulted under the Collateral Documents pursuant
to Paragraph 3 above, (c) becomes the owner of the Bossier City Project, (d)
undertakes to complete the construction of the Bossier City Project pursuant
to its rights under the Collateral Documents, or (e) following an Event of
Default, otherwise requires the performance of Contracting Party's obligations
under the Contract or the use of any plans and specifications, drawings,
surveys or other materials or documents previously prepared or provided by
Contracting Party pursuant to the Contract, then in any such event, so long as
Contracting Party has received and continues to receive the compensation
required under the Contract related thereto, Trustee shall have the right to
obtain performance from Contracting Party of all of its obligations under the
Contract, and to use all such plans and specifications, drawings, surveys and
other materials and documents, and the ideas, designs and concepts contained
therein, in connection with the completion of the Bossier City Project,
without the payment of any additional fees or charges to Contracting Party.
5. AMENDMENTS AND CHANGE ORDERS. Contracting Party agrees that it
will not modify, amend, supplement or in any way join in the release or
discharge of Contracting Party's obligations under the Contract unless (a)
such change is commercially reasonable and (b) Disbursement Agent consents to
such change in writing, or such change is otherwise expressly permitted by the
Disbursement Agreement, and that it will not perform any work pursuant to any
change order or directive unless the same is issued and executed in accordance
with the terms and conditions of the Contract.
6. LIST OF SUBCONTRACTING PARTIES.Upon the written request of
Trustee at any time and from time to time, Contracting Party shall furnish to
Trustee a current list of all Persons with whom Contracting Party has entered
into subcontracts or other agreements related to the rendering of work, labor
or materials under the Contract, together with a statement as to the status of
each such subcontractor agreement, and the respective amounts, if any, owed by
Contracting Party related thereto.
J-2
7. REPRESENTATIONS AND WARRANTIES.Contracting Party represents and
warrants to Trustee that (a) it is duly licensed to conduct its business in
the jurisdiction contemplated by the Contract, and will at all times maintain
its license in full force and effect throughout the term thereof, (b) the
Contract has not been amended, modified or supplemented except as set forth
therein, (c) the Contract constitutes a valid and binding obligation of
contracting Party and is enforceable in accordance with its terms, (d) there
have been no prior assignments of the Contract, and (e) all covenants,
conditions and agreements of the Company and Contracting Party contained in
the Contract have been performed as required therein, except for those that
are not due to be performed until after the date hereof.
8. APPLICATIONOF FUNDS. Nothing herein imposes or shall be
construed to impose upon Trustee any duty to direct the application of any
proceeds of the Notes, and Contracting Party acknowledges that Trustee is not
obligated to Contracting Party or any of its subcontracting parties,
materialmen, suppliers or laborers.
9. ACKNOWLEDGMENT OF INDUCEMENT.Contracting Party is executing
this consent to induce the purchasers of the Notes to purchase the Notes.
Contracting Party understands that the purchasers of the Notes would not
advance such funds and make such purchases but for Contracting Party's
execution and delivery hereof.
10. GOVERNING LAW.This Consent shall be governed by the laws
of the State of Louisiana.
IN WITNESS WHEREOF, Contracting Party has executed this Consent as of the
date first above written.
CONTRACTING PARTY:
By:
Name:
Title:
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EXHIBIT K TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
[ATTACH FORM OF MECHANIC'S LIEN ENDORSEMENT]
K-1
EXHIBIT L TO CASH COLLATERAL AND DISBURSEMENT AGREEMENT
199-
SEI Fund Resources, a Delaware business trust, as administrator of the Marquis
Funds, a Massachusetts business trust and the issuer of the Marquis Funds
Treasury Securities Money Market Fund
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Attention: ▇▇▇▇ ▇▇▇▇▇, Fund Accountant (fax number ▇▇▇-▇▇▇-▇▇▇▇)
Re: Pledge of Shares of Marquis Funds Treasury Securities Money Market
Fund (the "ISSUER")
Dear Fund Accountant:
This letter shall provide you with irrevocable instructions concerning account
number of the Marquis Funds Treasury Securities Money Market Fund, and all
shares of beneficial interest of the Issuer and other assets and investments
from time to time credited thereto or deposited therein (collectively, the
"ACCOUNT"). Said Account shall be registered in the name of Casino Magic of
Louisiana, Corp. (the "SHAREHOLDER"). The Shareholder hereby certifies and
agrees as follows:
1. The Shareholder has pledged and granted a security interest (the
"PLEDGE")in the Account, together with all shares of beneficial interest of
the Issuer credited thereto and all assets, investments, interest, dividends,
gains, income, reinvestments and other proceeds, to First Union Bank of
Connecticut (the "TRUSTEE"), in its capacity as trustee under that certain
Indenture dated as of August 22, 1996 among the Shareholder., Jefferson Casino
Corporation and First Union Bank of Connecticut and pertaining to the
Shareholder's First Mortgage Notes due 2003 With Contingent Interest. In such
capacity, the Trustee is referred to herein as the "PLEDGEE."
2. The Shareholder hereby represents to you that: (a) the Pledgee has
designated First
National Bank of Commerce (the "AGENT") to serve as the Pledgee's designee and
agent in order to perfect the security interest in favor of the Pledgee; and
(b) the Shareholder has not granted any security interest, right or claim in
the Account to any Person other than the Pledgee.
3. Accordingly, the Shareholder hereby irrevocably directs you to
make such notations in the records pertaining to the Account as are necessary
to reflect the Pledge, including the registration of the Account (and all
shares, assets and other investments from time to time credited thereto or
deposited therein) in the name of the Shareholder and the registration of the
Pledge of the Account (and all shares, assets and other investments from time
to time credited thereto or deposited therein) in the following name:
"First National Bank of Commerce, as agent for First Union Bank of
Connecticut, in the latter's capacity as trustee under that certain Indenture
dated as of August 22, 1996 among Casino Magic of Louisiana, Corp., Jefferson
Casino Corporation and First Union Bank of Connecticut and pertaining to
Casino Magic of Louisiana, Corp.'s First Mortgage Notes due 2003 With
Contingent Interest"
4. The Shareholder hereby further irrevocably directs you to reinvest
all dividends or distributions from net investment income and capital gains in
additional shares of the Marquis Funds Treasury Securities Money Market Fund,
subject to the Pledge. In addition, the Shareholder hereby irrevocably
instructs you, notwithstanding any contrary instructions from the Shareholder,
to follow only instructions received from the Agent, furnished in writing,
concerning (a) the payment or reinvestment of dividends or distributions with
respect to the Account and (b) the redemption, transfer, sale or any other
disposition or transaction concerning the Account (and all shares, assets and
other investments from time to time credited thereto or deposited therein) or
the interest, dividends, gains and other income thereon.
5. The Shareholder also irrevocably authorizes and directs you
to send all notices,
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statements and all other communications concerning the Account to the
following address or such other address as may be specified in written
instructions from the Agent:
First National Bank of Commerce,
as agent for First Union Bank of Connecticut
Corporate Trust Division
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Re: Casino Magic of Louisiana, Corp.
6. The Shareholder agrees that neither you, the Issuer or any of
their respective partners, trustees, officers, employees or affiliates
(collectively, the "ISSUER AFFILIATES") shall be liable for complying in good
faith with the instructions contained herein or failing to comply with any
contrary or inconsistent instructions that may subsequently be issued by the
Shareholder. The Shareholder further agrees to hold harmless and indemnify
each of the Issuer Affiliates against any claim or loss arising out of any
actions or omissions taken by any Person in reliance on or compliance with the
instructions and authorizations contained herein.
7. The Shareholder agrees that the instructions contained herein may
be revoked by the Shareholder only upon the receipt by you of the Agent's
written consent to such revocation or written notification from the Agent that
the Pledge has been terminated.
8. This letter and any amendments, waivers, consents or supplements
may be executed in any number of counterparts, each of which when so executed
and delivered shall be deemed an original, but all of which shall together
constitute one and the same agreement.
Very truly yours,
CASINO MAGIC OF LOUISIANA, CORP.
By:
Name:
Title:
cc: SEI Financial Services Corporation, Attn: ▇▇▇▇ ▇▇▇▇, Esq. (fax number
▇▇▇-▇▇▇-▇▇▇▇)
DST Systems, Inc., Attn: ▇▇▇ ▇▇▇▇▇▇ (fax number ▇▇▇-▇▇▇-▇▇▇▇)
GUARANTEE OF SIGNATURE
Authorized Signature
By:
Title:
Dated:
L-2
CONFIRMATION FROM ISSUER
The undersigned hereby confirms the following for the benefit of the
above-referenced Pledgee and Agent:
(i) The undersigned is the administrator and agent for the Issuer in
connection with (among other things) the registration of transfers and pledges
of the Issuer's uncertificated securities, and the Issuer has been organized
under the laws of a jurisdiction which has adopted Article 8 of the Uniform
Commercial Code pertaining to uncertificated securities, and said laws
accordingly permit the undersigned to register a pledge of the Account in
favor of the Pledgee by taking the steps in numbered paragraph 3 of the above
letter.
(ii) The undersigned shall comply, and shall cause the transfer and
other agents of the Issuer to comply, with the instructions in the above
letter. The Pledge has been registered on
199-.
(iii) Immediately after registration of the Pledge, there were no
liens, restrictions or adverse claims (as to which the undersigned has a duty
to disclose under the Uniform Commercial Code) to the Account, other than the
Pledge.
Date:199
SEI Fund Resources, a Delaware business trust
By:
Name:
Title:
L-3
EXHIBIT M TO CASH COLLATERAL AND DISBURSEMENT ACCOUNT
[attach pro forma title policy]
Source and documentation (receipts for purchased goods) for Realized Savings
are attached.
M-1