Execution Copy
CREDIT AGREEMENT
DATED AS OF AUGUST 25, 1995
AMONG
PLAYERS INTERNATIONAL, INC.,
as Borrower,
THE LENDERS LISTED HEREIN,
as Lenders,
FIRST INTERSTATE BANK OF NEVADA, N.A.,
Individually and as Administrative Agent, a Managing Agent
and a Co-Arranger,
BANKERS TRUST COMPANY,
Individually and as a Managing Agent,
and
BT SECURITIES CORPORATION,
as a Co-Arranger
PLAYERS INTERNATIONAL, INC.
CREDIT AGREEMENT
TABLE OF CONTENTS
Page
Section 1. DEFINITIONS.................................................................................... 2
1.1 Certain Defined Terms.......................................................................... 2
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations
Under Agreement................................................................................ 34
1.3 Other Definitional Provisions.................................................................. 34
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS..................................................... 34
2.1 Commitments; Making of Loans; Notes............................................................ 34
2.2 Interest on the Loans.......................................................................... 41
2.3 Fees........................................................................................... 45
2.4 Payments, Prepayments and Reductions in Commitments; General
Provisions Regarding Payments.................................................................. 45
2.5 Use of Proceeds................................................................................ 50
2.6 Special Provisions Governing Eurodollar Rate Loans............................................. 51
2.7 Increased Costs; Taxes; Capital Adequacy....................................................... 53
2.8 Obligation of Lenders and Administrative Agent to Mitigate..................................... 57
2.9 Replacement of Lenders......................................................................... 58
Section 3. LETTERS OF CREDIT.............................................................................. 58
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein........................................................................................ 58
3.2 Letter of Credit Fees.......................................................................... 60
3.3 Drawings and Reimbursement of Amounts Drawn Under Letters of
Credit......................................................................................... 61
3.4 Obligations Absolute........................................................................... 64
3.5 Indemnification; Nature of Administrative Agent's Duties....................................... 65
3.6 Increased Costs and Taxes Relating to Letters of Credit........................................ 66
Section 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT...................................................... 67
4.1 Conditions to Initial Revolving Loans.......................................................... 67
4.2 Conditions to All Loans........................................................................ 74
4.3 Conditions to Letters of Credit................................................................ 75
Section 5. COMPANY'S REPRESENTATIONS AND WARRANTIES....................................................... 76
5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries................................................................................... 76
5.2 Authorization of Borrowing, etc................................................................ 77
5.3 Financial Condition............................................................................ 78
(i)
Page
5.4 No Material Adverse Change; No Restricted Payments............................................. 78
5.5 Title to Properties; Liens..................................................................... 79
5.6 Litigation; Adverse Facts...................................................................... 80
5.7 Payment of Taxes............................................................................... 80
5.8 Performance of Agreements; Materially Adverse Agreements....................................... 80
5.9 Governmental Regulation........................................................................ 81
5.10 Securities Activities.......................................................................... 81
5.11 Employee Benefit Plans......................................................................... 81
5.12 Certain Fees................................................................................... 82
5.13 Environmental Protection....................................................................... 82
5.14 Employee Matters............................................................................... 83
5.15 Solvency....................................................................................... 84
5.16 Disclosure..................................................................................... 84
5.17 Compliance With Laws........................................................................... 84
5.18 Representations Relating to Operation of Facilities............................................ 84
5.19 Intangible Property............................................................................ 85
5.20 Rights to Agreements, Permits and Licenses..................................................... 85
5.21 Classification of Ships........................................................................ 85
5.22 Recordation of Ship Mortgages.................................................................. 85
5.23 Policies of Insurance.......................................................................... 86
Section 6. COMPANY'S AFFIRMATIVE COVENANTS................................................................ 86
6.1 Financial Statements and Other Reports......................................................... 86
6.2 Corporate Existence, etc....................................................................... 92
6.3 Payment of Taxes and Claims; Tax Consolidation................................................. 92
6.4 Maintenance of Properties; Insurance........................................................... 93
6.5 Inspection; Lender Meeting..................................................................... 93
6.6 Compliance with Laws, etc...................................................................... 94
6.7 Environmental Disclosure and Inspection........................................................ 94
6.8 Company's Remedial Action Regarding Hazardous Materials........................................ 95
6.9 Post-Closing Matters........................................................................... 96
6.10 New Subsidiaries; New Joint Ventures; Further Assurances....................................... 96
Section 7. COMPANY'S NEGATIVE COVENANTS................................................................... 99
7.1 Indebtedness...................................................................................100
7.2 Liens and Related Matters......................................................................100
7.3 Investments, Loans and Advances; Joint Ventures................................................101
7.4 Contingent Obligations.........................................................................102
7.5 Restricted Payments............................................................................102
7.6 Financial Covenants............................................................................102
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions...............................103
7.8 Transactions with Shareholders and Affiliates..................................................104
7.9 Disposal of Subsidiary Stock...................................................................105
(ii)
Page
7.10 Conduct of Business............................................................................105
7.11 Tradenames, Trademarks and Servicemarks........................................................105
7.12 Change of Control Offer........................................................................105
7.13 No Amendment of Indenture......................................................................105
7.14 No Movement of Other Barges....................................................................106
Section 8. EVENTS OF DEFAULT..............................................................................106
8.1 Failure to Make Payments When Due..............................................................106
8.2 Default in Other Agreements....................................................................106
8.3 Breach of Certain Covenants....................................................................107
8.4 Breach of Warranty.............................................................................107
8.5 Other Defaults Under Loan Documents............................................................107
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc...........................................107
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.............................................108
8.8 Judgments and Attachments......................................................................108
8.9 Dissolution....................................................................................108
8.10 Employee Benefit Plans.........................................................................108
8.11 Change in Control..............................................................................109
8.12 Impairment of Collateral.......................................................................109
8.13 Loss of Gaming License.........................................................................109
8.14 Invalidity of Guaranty.........................................................................109
8.15 Material Adverse Change........................................................................109
8.16 Remedies.......................................................................................110
Section 9. ADMINISTRATIVE AGENT.........................................................................111
9.1 Appointment....................................................................................111
9.2 Powers; General Immunity.......................................................................111
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness...............................................................................113
9.4 Right to Indemnity.............................................................................113
9.5 Successor Administrative Agent and Swing Line Lender...........................................113
9.6 Collateral Documents...........................................................................114
9.7 Release of Collateral..........................................................................114
Section 10. MISCELLANEOUS..................................................................................115
10.1 Assignments and Participations in Loans and Letters of Credit..................................115
10.2 Expenses.......................................................................................119
10.3 Indemnity......................................................................................119
10.4 Set-Off; Security Interest in Deposit Accounts.................................................120
10.5 Ratable Sharing................................................................................121
10.6 Amendments and Waivers.........................................................................121
10.7 Independence of Covenants......................................................................122
10.8 Notices........................................................................................123
(iii)
Page
10.9 Survival of Representations, Warranties and Agreements.........................................123
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative..........................................123
10.11 Marshalling; Payments Set Aside................................................................123
10.12 Severability...................................................................................124
10.13 Obligations Several; Independent Nature of Lenders' Rights.....................................124
10.14 Headings.......................................................................................124
10.15 Applicable Law.................................................................................124
10.16 Successors and Assigns.........................................................................125
10.17 Consent to Jurisdiction and Service of Process; Choice of Forum................................125
10.18 Waiver of Jury Trial...........................................................................125
10.19 Confidentiality................................................................................126
10.20 Licensing of Administrative Agent and Lenders..................................................126
10.21 Counterparts; Effectiveness....................................................................127
10.22 Cooperation With Gaming Boards.................................................................127
Signature pages ....................................................................... S-1
(iv)
PLAYERS INTERNATIONAL, INC.
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of August 25, 1995 and
entered into by and among PLAYERS INTERNATIONAL, INC., a Nevada corporation, as
the borrower ("Company"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE
PAGES HEREOF (each individually referred to herein as a "Lender" and
collectively as "Lenders"), FIRST INTERSTATE BANK OF NEVADA, N.A. ("FIB," and,
in its capacity as administrative agent for Lenders, "Administrative Agent"), as
a Lender, Administrative Agent, a Managing Agent and a Co-Arranger, BANKERS
TRUST COMPANY ("BTCo," in its capacity as managing agent for Lenders, a
"Managing Agent", and, collectively with FIB, the "Managing Agents"), as a
Lender and as a Managing Agent, and BT SECURITIES CORPORATION ("BT SECURITIES,"
in its capacity as Co-Arranger, a "Co-Arranger," and, collectively with FIB, the
"Co-Arrangers").
R E C I T A L S
WHEREAS, Company has issued $150,000,000 in principal amount
of 10-7/8% Senior Notes Due 2005 (the "Senior Notes") in order to finance
certain expansions and completions of its existing and future gaming operations,
both on riverboat casinos and an on-land hotel and casino;
WHEREAS, certain of Company's Subsidiaries have jointly and
severally guaranteed without condition the payment of all principal, premium,
and interest, if any, under the Senior Notes;
WHEREAS, Company desires to obtain financing from Lenders so
as to, among other things, have an additional source of funds for its planned
expansion projects and to further other general corporate purposes;
WHEREAS, each Subsidiary of Company existing on the date
hereof or hereafter created that is not an Excluded Subsidiary shall guarantee
the payment of the Loans by Company pursuant to a Guaranty to be executed by
each such party simultaneously herewith; and
WHEREAS, the Loans shall be secured by a lien on all real and
personal property of Company and its Subsidiaries related to the gaming
operations conducted or to be conducted by Company or any of its Subsidiaries at
(a) Players Island Resort in Mesquite, Nevada, (b) the riverboat casino and
related facilities in Metropolis, Illinois and (c) the riverboat casino and
related facilities in Lake Charles, Louisiana, including,
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without limitation, a pledge of the capital stock or other equity interest held,
directly or indirectly, by Company in each Subsidiary of Company existing on the
date hereof or hereafter created that is not an Excluded Subsidiary;
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, Company, Lenders,
Administrative Agent, Managing Agents and Co-Arrangers hereby agree as follows:
Section 1. DEFINITIONS
1.1 Certain Defined Terms.
The following terms used in this Agreement shall have the
following meanings:
"Accepting Lender" has the meaning assigned to that term in
subsection 2.1F.
"Acknowledgement and Estoppel Agreements" means those certain
Acknowledgement and Estoppel Agreements by various owners of certain portions of
the Premises, each as a landlord, and certain of Company's Subsidiaries, each as
a tenant, pursuant to which each landlord thereto acknowledges the existence of
Administrative Agent as leasehold mortgagee and certifies the validity of the
leasehold interest held by the applicable Subsidiary of Company.
"Actual Reduction Commencement Date" means the Reduction
Commencement Date, as such date may be affected by the provisions contained
within subsection 2.1F.
"Adjusted Eurodollar Rate" means, for any Interest Rate
Determination Date with respect to an Interest Period for a Eurodollar Rate
Loan, the rate per annum obtained by dividing (i) the offered quotation, if any,
to FIB (or an Affiliate of FIB) by prime banks in the London interbank market
for Dollar deposits of amounts in same day funds comparable to the principal
amount of the Eurodollar Rate Loan of FIB for which the Adjusted Eurodollar Rate
is then being determined with maturities comparable to such Interest Period as
of approximately 10:00 A.M. (London time) on such Interest Rate Determination
Date by (ii) a percentage equal to 100% minus the stated maximum rate of all
reserve requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves) applicable on such Interest Rate
Determination Date to any member bank of the Federal Reserve System in respect
of "Eurocurrency liabilities" as defined in Regulation D (or any successor
category of liabilities under Regulation D).
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"Adjusted Leverage Ratio" means, as of any date of
determination, the Leverage Ratio; provided that Excess Cash and Cash
Equivalents as of such date shall be deducted in calculating the numerator
thereof.
"Administrative Agent" means FIB.
"Affected Lender" has the meaning assigned to that term in
subsection 2.6C.
"Affiliate", as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means (i) the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise or (ii) the beneficial ownership of 10% or more of any
class of voting capital stock of a Person (on a fully diluted basis) or of
warrants or other rights to acquire such class of capital stock (whether or not
presently exercisable).
"Agreement" means this Credit Agreement dated as of August 25,
1995, as it may be amended, supplemented or otherwise modified from time to
time.
"Allocated Costs of Internal Counsel" means, as of any date of
determination, the internal costs imputed to in-house counsel employed by
Administrative Agent for the review, negotiation, preparation, execution and
administration of the Loan Documents, as based on the time records submitted to
Company within 90 days of the services performed by such counsel at an hourly
rate not to exceed the then prevailing market rate in Los Angeles, California
for an attorney with a minimum of ten years experience in financing
transactions.
"Applicable Base Rate Margin" means, as of any date of
determination, (i) a percentage per annum as shown below determined by the
Leverage Ratio on the date of the most recent Pricing Determination Certificate
delivered by Company pursuant to subsection 6.1(xvi); provided that the
Applicable Base Rate Margin shall not be adjusted upon receipt of a Pricing
Determination Certificate until the first Business Day of the month following
the date on which such Pricing Determination Certificate is due or (ii) if
Company has failed to provide such certificate within the time period set forth
for such delivery in subsection 6.1(xvi), the Applicable Base Rate Margin shall
be 0.50% on and after the first Business Day following the date on which
delivery of such Pricing Determination Certificate was due until the first
Business Day of the month following the date that such past due certificate is
actually received by Administrative Agent; provided further that on the first
Business Day of the month following receipt of a past due certificate by
Administrative Agent, the Applicable Base Rate Margin shall be determined as set
forth above:
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Leverage Ratio Applicable Base Rate Margin
--------------- ---------------------------
less than 1.25 0.00%
greater than or equal to 1.25 0.25%
but less than 1.75
greater than or equal to 1.75 0.50%
"Applicable Commitment Fee Percentage" means, as of any date
of determination, (a) 0.375% per annum during such periods as the Leverage Ratio
on the date of the most recent Pricing Determination Certificate delivered by
Company pursuant to subsection 6.1(xvi) is less than 1.25:1.00 and (b) 0.50% per
annum during such periods as the Leverage Ratio on the date of the most recent
Pricing Determination Certificate delivered by Company pursuant to subsection
6.1(xvi) is greater than or equal to 1.25:1.00; provided that the Applicable
Commitment Fee Percentage shall not be adjusted upon receipt of a Pricing
Determination Certificate until the first Business Day of the month following
the date on which such Pricing Determination Certificate is due or (ii) if
Company has failed to provide such certificate within the time period set forth
for such delivery in subsection 6.1(xvi), the Applicable Commitment Fee
Percentage shall be 0.50% on and after the first Business Day following the date
on which delivery of such Pricing Determination Certificate was due until the
first Business Day of the month following the date that such past due
certificate is actually received by Administrative Agent; provided further that
on the first Business Day of the month following receipt of a past due
certificate by Administrative Agent, the Applicable Commitment Fee Percentage
shall be determined as set forth above.
"Applicable Eurodollar Margin" means, as of any date of
determination, (i) a percentage per annum as shown below determined by the
Leverage Ratio on the date of the most recent Pricing Determination Certificate
delivered by Company pursuant to subsection 6.1(xvi); provided that the
Applicable Eurodollar Margin shall not be adjusted upon receipt of a Pricing
Determination Certificate until the first Business Day of the month following
the date on which such Pricing Determination Certificate is due or (ii) if
Company has failed to provide such certificate within the period set forth for
such delivery in subsection 6.1(xvi), the Applicable Eurodollar Margin shall be
2.25% on and after the first Business Day following the date on which delivery
of such Pricing Determination Certificate was due until the first Business Day
of the month following the date that such past due certificate is actually
received by Administrative Agent; provided further that on the first Business
Day of the month following receipt of a past due certificate by Administrative
Agent, the Applicable Eurodollar Margin shall be determined as set forth above:
4
Leverage Ratio Applicable Eurodollar Margin
-------------- --------------------------
less than 0.75 1.25%
greater than or equal to 0.75 1.75%
but less than 1.25
greater than or equal to 1.25 2.00%
but less than 1.75
greater than or equal to 1.75 2.25%
"Assessment" means the obligation of any Person that owns an
equity interest in any legal entity to pay or contribute additional capital to
such entity, whether such obligation arises on a scheduled basis or upon the
occurrence of one or more contingent events.
"Asset Sale" means the sale by Company or any of its
Subsidiaries to any Person other than Company or any of its wholly-owned
Subsidiaries of (i) any of the stock of any of Company's Subsidiaries, (ii) 50%
or more of the assets of Company or any of its Subsidiaries, or (iii) any other
assets used or useful in the operations of Company or its Subsidiaries (whether
tangible or intangible) outside of the ordinary course of business.
"Bankruptcy Code" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor statute.
"Barges" means, collectively, US Documented Barges and Other
Barges.
"Base Rate" means, at any time, the higher of (x) the Prime
Rate or (y) the rate which is 1/2 of 1% in excess of the Federal Funds Effective
Rate.
"Base Rate Loans" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection 2.2A.
"▇▇▇▇▇▇ Lease" has the meaning assigned to that term in
subsection 6.10D.
"▇▇▇▇▇▇ Property" has the meaning assigned to that term in
subsection 6.10D.
"Best Knowledge" means, as applied to Company, (i) actual
knowledge by any Responsible Officer of any fact or (ii) imputed knowledge of
any fact which should, upon the reasonable exercise of diligence (appropriate
for the circumstance in question) by any such Responsible Officer in his or her
employment position, have been known.
"BTCo" has the meaning assigned to that term in the first
paragraph of this Agreement.
5
"BT Securities" has the meaning assigned to that term in the
first paragraph of this Agreement.
"Business Day" means any day excluding Saturday, Sunday and
any day which is a legal holiday under the laws of the State of Nevada or is a
day on which banking institutions located in such state are authorized or
required by law or other governmental action to close.
"Capital Lease," as applied to any Person, means any lease of
any property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"Cash" means money, currency or a credit balance in a Deposit
Account.
"Cash Equivalents" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, the highest rating
obtainable from either Standard & Poor's Ratings Group ("S&P") or ▇▇▇▇▇'▇
Investors Service, Inc. ("Moody's"); (iii) commercial paper maturing no more
than one year from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody's; (iv) certificates of deposit or bankers' acceptances maturing within
one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (a) is at least "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; and (v) shares of any money market mutual fund that (a)
has at least 95% of its assets invested continuously in the types of investments
referred to in clauses (i) and (ii) above, (b) has net assets of not less than
$500,000,000, and (c) has the highest rating obtainable from either S&P or
Moody's.
"Cash Proceeds" means Cash payments (including any Cash
received by way of deferred payment pursuant to, or monetization of, a note
receivable or otherwise, but only as and when so received) and Cash Equivalents
received by Company or any of its Subsidiaries from any Asset Sale or upon the
occurrence of an Event of Loss.
"Change of Control" means (i) any Person or "group" (within
the meaning of Section 13(d)(3) of the Exchange Act) shall have acquired
"beneficial ownership" (within the meaning of Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of Company representing 20% or more
of the combined voting power of all
6
securities of Company entitled to vote in the election of directors; or (ii)
during any period of up to 12 consecutive months, commencing before or after the
date of this Agreement, individuals who at the beginning of such 12-month period
were directors of Company shall cease for any reason to constitute a majority of
the Board of Directors of Company; or (iii) any Person or "group" shall have
acquired by contract or otherwise, or shall have entered into a contract or
arrangement that upon consummation shall result in its or their acquisition of
or control over, securities of Company representing 20% or more of the combined
voting power of all securities of Company entitled to vote in the election of
directors; provided that a Change of Control shall not be deemed to occur under
clauses (i) or (iii) above if the Person referred to in either such clause is an
Excluded Person, or the "group" referred to in either such clause consists
exclusively of two or more Excluded Persons, unless (x) the transaction or
series of transactions that creates the Change of Control is subject to Rule
13e-3 under the Exchange Act or any similar or successor rule and (y)
immediately prior to and during the 180-day period following either (1) such
transaction or series of transactions referred to in clause (x), or (2) the time
that any such Excluded Person or "group" consisting exclusively of two or more
Excluded Persons shall have acquired "beneficial ownership", directly or
indirectly, of 20% or more of such total voting power, as referred to in clause
(iii), the Senior Notes are or become rated, in the case of clause (1) or (2),
"B+" or below by S&P and "B1" or below by Moody's or, if either such rating
agency or both such rating agencies shall no longer make a rating of the Senior
Notes publicly available, the comparable ratings of another nationally
recognized securities rating agency or agencies, as the case may be, selected by
Company, which shall be substituted for S&P or Moody's or both, as the case may
be; provided further that the 180-day period referred to in clause (y) shall be
extended for so long as the rating of the Senior Notes is under publicly
announced consideration for possible downgrade by any such rating agency.
"Closing Date" means the date, on or before September 1, 1995,
upon which all of the conditions to the making of the initial Loans set forth in
subsection 4.1 (other than delivery of environmental assessments required by
subsection 4.1S) are first satisfied or waived.
"Co-Arranger" means either of FIB or BT Securities and
"Co-Arrangers" means FIB and BT Securities, collectively.
"Collateral" means all the real, personal and mixed property
made subject to a Lien pursuant to the Collateral Documents.
"Collateral Account" has the meaning assigned to that term in
the Collateral Account Agreement.
"Collateral Account Agreement" means the Collateral Account
Agreement executed and delivered by Company and Administrative Agent on the
Closing Date, substantially in the form of Exhibit VIII annexed hereto, pursuant
to which Company may pledge cash to Administrative Agent to secure the
obligations of Company to
7
reimburse Administrative Agent for payments made under one or more Letters of
Credit as provided in Section 8, as such Collateral Account Agreement may
hereafter be amended, supplemented or otherwise modified from time to time.
"Collateral Assignment Agreement" means that certain
Collateral Assignment Agreement between PMGC and Administrative Agent dated the
Closing Date, as it may hereafter be amended, supplemented or otherwise
modified, from time to time.
"Collateral Documents" means the Mortgages, the Ship
Mortgages, the Guaranty, the Company Security Agreement, the Subsidiary Security
Agreements, the Company Pledge Agreements, the LLC Membership Interest Security
Agreements, the Partnership Interest Security Agreements, the Collateral
Assignment Agreement and all other instruments or documents now or hereafter
granting Liens on property of Company or any of its Subsidiaries to
Administrative Agent for benefit of Lenders.
"Commitment" means, the commitment of any Lender, and
"Commitments" means such commitments of all Lenders in the aggregate at the time
of reference.
"Commitment Termination Date" means the fourth anniversary
date of the Actual Reduction Commencement Date.
"Company" means Players International, Inc., a Nevada
corporation.
"Company Pledge Agreements" means those certain Pledge
Agreements between Company and Administrative Agent dated the Closing Date,
substantially in the forms of Exhibit XI and Exhibit XI-A annexed hereto,
respectively, as each such agreement may hereafter be amended, supplemented or
otherwise modified, from time to time.
"Company Security Agreement" means that certain Security
Agreement between Company and Administrative Agent dated the Closing Date,
substantially in the form of Exhibit XVI annexed hereto, as it may hereafter be
amended, supplemented or otherwise modified, from time to time.
"Compliance Certificate" means a certificate substantially in
the form of Exhibit X annexed hereto delivered to Administrative Agent and
Lenders by Company pursuant to subsection 6.1(iii).
"Consolidated Capital Expenditures" means, for any period, the
sum of the aggregate of all expenditures (whether paid in cash or other
consideration or accrued as a liability and including that portion of Capital
Leases that is capitalized on the consolidated balance sheet of Company and its
Subsidiaries) by Company and its Subsidiaries during that period that, in
conformity with GAAP, are included in "capital
8
expenditures" or comparable items reflected in the consolidated statement of
cash flows of Company and its Subsidiaries.
"Consolidated EBIDTA" means, for any period Consolidated Net
Income for such period plus, to the extent such items were subtracted in the
determination of Consolidated Net Income, the sum of the amounts for such period
of (i) Consolidated Interest Expense, (ii) provisions for taxes based on income,
(iii) total depreciation expense, (iv) total amortization expense, and (v) other
non-cash items reducing Consolidated Net Income less other non-cash and/or
extraordinary, non-recurring items increasing Consolidated Net Income plus other
extraordinary and non-recurring items decreasing Consolidated Net Income, all of
the foregoing as determined on a consolidated basis for Company and its
Subsidiaries in conformity with GAAP.
"Consolidated Fixed Charges" means, for any period, the sum
(without duplication) of the amounts for such period of (i) Consolidated
Interest Expense, (ii) scheduled payments of principal on the long-term portion
of Consolidated Total Debt, (iii) the principal component of payments on Capital
Leases and (iv) all Assessments payable by Company or any of its Subsidiaries
during such period.
"Consolidated Interest Expense" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) of Company and its Subsidiaries
on a consolidated basis with respect to all outstanding Indebtedness of Company
and its Subsidiaries, including, without limitation, all commissions, discounts
and other fees and charges owed with respect to letters of credit and bankers'
acceptance financing and net costs under Interest Rate Agreements, but
excluding, however, any amounts referred to in subsection 2.3 payable to
Administrative Agent and Lenders on or before the Closing Date.
"Consolidated Net Income" means, for any period, the net
income (or loss) of Company and its Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in conformity with
GAAP; provided that there shall be excluded (i) the income (or loss) of any
Person (other than a Subsidiary of Company) in which any other Person (other
than Company or any of its Subsidiaries) has a joint interest, except to the
extent of the amount of dividends or other distributions actually paid to
Company or any of its Subsidiaries by such Person during such period, (ii) the
income (or loss) of any Person accrued prior to the date it becomes a Subsidiary
of Company or is merged into or consolidated with Company or any of its
Subsidiaries or that Person's assets are acquired by Company or any of its
Subsidiaries, (iii) the income of any Subsidiary of Company to the extent that
the declaration or payment of dividends or similar distributions by that
Subsidiary of that income is not at the time permitted by operation of the terms
of its charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to that Subsidiary, (iv) any
after-tax gains or losses attributable to Asset Sales or returned surplus assets
of any Pension Plan, and (v) (to the extent not included in clauses (i) through
(iv) above) any net extraordinary gains or net non-cash extraordinary losses.
9
"Consolidated Tangible Net Worth" means, as at any date of
determination, the sum of the par value of Company's capital stock and
additional paid-in capital plus retained earnings (or minus accumulated
deficits) less all intangible assets (including goodwill and excess purchase
price over historical basis entries) of Company and its Subsidiaries on a
consolidated basis determined in conformity with GAAP.
"Consolidated Total Debt" means, as at any date of
determination, the aggregate stated balance sheet amount of all Indebtedness of
Company and its Subsidiaries on a consolidated basis in accordance with GAAP.
"Consolidating" means, as used to describe financial
statements referred to in subsections 5.3, 6.1(i), 6.1(ii) and 6.1(xiii), the
separate financial statements reflecting the accounts of Company and its
Subsidiaries.
"Contingent Obligation", as applied to any Person, means any
direct or indirect liability, contingent or otherwise, of that Person (i) with
respect to any Indebtedness, lease, dividend or other obligation of another if
the primary purpose or intent thereof by the Person incurring the Contingent
Obligation is to provide assurance to the obligee of such obligation of another
that such obligation of another will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the account of
that Person or as to which that Person is otherwise liable for reimbursement of
drawings, (iii) under Interest Rate Agreements, (iv) to make an Investment in
any other Person or (v) under any Development Proposal; provided that a
Development Proposal shall not be deemed to constitute a Contingent Obligation
until such time, if ever, as it becomes a Development Commitment. Contingent
Obligations shall include, without limitation, (a) the direct or indirect
guaranty, endorsement (otherwise than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with recourse
by such Person of the obligation of another, (b) the obligation to make
take-or-pay or similar payments if required regardless of non-performance by any
other party or parties to an agreement, and (c) any liability of such Person for
the obligation of another through any agreement (contingent or otherwise) (X) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (Y) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under subclauses (X) or (Y) of this sentence, the primary purpose or
intent thereof is as described in the preceding sentence. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported or, if less, the amount to which such
Contingent Obligation is specifically limited.
"Contractual Obligation", as applied to any Person, means any
provision of any Security issued by that Person or of any material indenture,
mortgage, deed of trust,
10
contract, undertaking, agreement or other instrument to which that Person is a
party or by which it or any of its properties is bound or to which it or any of
its properties is subject.
"Deposit Account" means a demand, time, savings, passbook or
like account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"Development Commitment" means a Development Proposal, at the
time, if any, that such Development Proposal is approved by any Governmental
Authority or other Person having jurisdiction over the subject matter of such
proposal and is binding upon Company or any of its Subsidiaries; provided that a
Development Proposal when so approved shall not be deemed to constitute a
Development Commitment until such time as Company and/or any of its Subsidiaries
have expended $5,000,000 in the aggregate in furtherance of such Development
Proposal. The Dollar amount of any Development Commitment as of any date of
determination shall be (X) the amount set forth therein or, if no such amount is
set forth, the good faith estimate of Company's Board of Directors of the amount
necessary to complete the development, expansion or refurbishment (but not
ordinary operating expenses) that is the subject of such Development Commitment
(exclusive of any portion of such amount that has already been expended by
Company or any of its Subsidiaries on such date of determination) minus (Y) the
portion, if any, of such amount that is, pursuant to a binding commitment from a
reputable Person that is not an Affiliate of Company or any of its Subsidiaries,
the sole responsibility of such non-Affiliate to provide, it being understood
that if, at any time on or after such a binding commitment is obtained, Company
or any of its Subsidiaries shall become or remain obligated, directly or
indirectly, to any Person for any such amount described in this clause (Y) other
than solely by virtue of Company's or such Subsidiary's status as a joint
venturer or general partner, such amount shall no longer be deductible in
determining the Dollar amount of such Development Commitment.
"Development Proposal" means an application, bid or other
proposal in any form whatsoever by Company or any of its Subsidiaries to any
Governmental Authority or other Person with respect to the development,
expansion or refurbishment of any casino, hotel, casino/hotel, casino/resort,
riverboat casino, dock casino, any other type of casino, golf course,
entertainment center or similar facility.
"Dollars" and the sign "$" mean the lawful money of the
United States of America.
"Eligible Assignee" means (A)(i) a commercial bank organized
under the laws of the United States or any state thereof; (ii) a savings and
loan association or savings bank organized under the laws of the United States
or any state thereof; (iii) a commercial bank organized under the laws of any
other country or a political subdivision thereof; provided that (x) such bank is
acting through a branch or agency located in the
11
United States or (y) such bank is organized under the laws of a country that is
a member of the Organization for Economic Cooperation and Development or a
political subdivision of such country; and (iv) any other entity which is an
"accredited investor" (as defined in Regulation D under the Securities Act)
which extends credit or buys loans as one of its businesses including, but not
limited to, insurance companies, mutual funds and lease financing companies, in
each case (under clauses (i) through (iv) above) that is reasonably acceptable
to and consented to by Managing Agents; and (B) any Lender and any Affiliate of
any Lender; provided that no Affiliate of Company shall be an Eligible Assignee.
"Employee Benefit Plan" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is, or was at any time, maintained or
contributed to by Company or any of its ERISA Affiliates.
"Environmental Claim" means any accusation, allegation, notice
of ▇▇▇▇▇- tion, claim, demand, abatement order or other order or direction
(conditional or otherwise) by any governmental authority or any Person for any
damage, including, without limitation, personal injury (including sickness,
disease or death), tangible or intangible property damage, contribution,
indemnity, indirect or consequential damages, damage to the environment,
nuisance, pollution, contamination or other adverse effects on the environment,
or for fines, penalties or restrictions, in each case relating to, resulting
from or in connection with Hazardous Materials and relating to Company, any of
its Subsidiaries, any of their respective Affiliates or any Facility.
"Environmental Indemnity" means the Environmental Indemnity
from Company in favor of Administrative Agent on behalf of Lenders dated as of
the Closing Date, substantially in the form of Exhibit XII annexed hereto,
pursuant to which Company indemnifies Administrative Agent on behalf of Lenders
against environmental risks.
"Environmental Laws" means all statutes, ordinances, orders,
rules, regulations, plans, policies or decrees and the like relating to (i)
environmental matters, including, without limitation, those relating to fines,
injunctions, penalties, damages, contribution, cost recovery compensation,
losses or injuries resulting from the Release or threatened Release of Hazardous
Materials, (ii) the generation, use, storage, transportation or disposal of
Hazardous Materials, or (iii) occupational safety and health, industrial
hygiene, land use or the protection of human, plant or animal health or welfare,
in any manner applicable to Company or any of its Subsidiaries or any of their
respective properties, including, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. ss. 9601 et
seq.), the Hazardous Materials Transportation Act (49 U.S.C. ss. 1801 et seq.),
the Resource Conservation and Recovery Act (42 U.S.C. ss. 6901 et seq.), the
Federal Water Pollution Control Act ( 33 U.S.C. ss. 1251 et seq.), the Clean Air
Act (42 U.S.C. ss. 7401 et seq.), the Toxic Substances Control Act (15 U.S.C.
ss. 2601 et seq.), the Federal Insecticide, Fungicide and Rodenticide Act (7
U.S.C. ss.136 et seq.), the Occupational Safety and Health Act (29
12
U.S.C. ss. 651 et seq.) and the Emergency Planning and Community
Right-to-Know Act (42 U.S.C. ss. 11001 et seq.), each as amended or
supplemented, and any analogous future or present local, state and federal
statutes and regulations promulgated pursuant thereto, each as in effect as of
the date of determination.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute.
"ERISA Affiliate", as applied to any Person, means (i) any
corporation which is, or was at any time, a member of a controlled group of
corporations within the meaning of Section 414(b) of the Internal Revenue Code
of which that Person is, or was at any time, a member; (ii) any trade or
business (whether or not incorporated) which is, or was at any time, a member of
a group of trades or businesses under common control within the meaning of
Section 414(c) of the Internal Revenue Code of which that Person is, or was at
any time, a member; and (iii) any member of an affiliated service group within
the meaning of Section 414(m) or (o) of the Internal Revenue Code of which that
Person, any corporation described in clause (i) above or any trade or business
described in clause (ii) above is, or was at any time, a member.
"ERISA Event" means (i) a "reportable event" within the
meaning of Section 4043 of ERISA and the regulations issued thereunder with
respect to any Pension Plan (excluding those for which the provision for 30-day
notice to the PBGC has been waived by regulation); (ii) the failure to meet the
minimum funding standard of Section 412 of the Internal Revenue Code with
respect to any Pension Plan (whether or not waived in accordance with Section
412(d) of the Internal Revenue Code) or the failure to make by its due date a
required installment under Section 412(m) of the Internal Revenue Code with
respect to any Pension Plan or the failure to make any required contribution to
a Multiemployer Plan; (iii) the provision by the administrator of any Pension
Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate
such plan in a distress termination described in Section 4041(c) of ERISA; (iv)
the withdrawal by Company or any of its ERISA Affiliates from any Pension Plan
with two or more contributing sponsors or the termination of any such Pension
Plan resulting in liability pursuant to Sections 4063 or 4064 of ERISA; (v) the
institution by the PBGC of proceedings to terminate any Pension Plan, or the
occurrence of any event or condition which might constitute grounds under ERISA
for the termination of, or the appointment of a trustee to administer, any
Pension Plan; (vi) the imposition of liability on Company or any of its ERISA
Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the
application of Section 4212(c) of ERISA; (vii) the withdrawal by Company or any
of its ERISA Affiliates in a complete or partial withdrawal (within the meaning
of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any
potential liability therefor, or the receipt by Company or any of its ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Company or any of its ERISA
13
Affiliates of any material fines, penalties, taxes or related charges under
Chapter 43 of the Internal Revenue Code or under Section 409 or 502(c), (i) or
(l) or 4071 of ERISA in respect of any Employee Benefit Plan; (ix) the assertion
of a material claim (other than routine claims for benefits) against any
Employee Benefit Plan other than a Multiemployer Plan or the assets thereof, or
against Company or any of its ERISA Affiliates in connection with any such
Employee Benefit Plan; (x) receipt from the Internal Revenue Service of notice
of the failure of any Pension Plan (or any other Employee Benefit Plan intended
to be qualified under Section 401(a) of the Internal Revenue Code) to qualify
under Section 401(a) of the Internal Revenue Code, or the failure of any trust
forming part of any Pension Plan to qualify for exemption from taxation under
Section 501(a) of the Internal Revenue Code; or (xi) the imposition of a Lien
pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code or
pursuant to ERISA with respect to any Pension Plan.
"Eurodollar Rate Loans" means Loans bearing interest at rates
determined by reference to the Adjusted Eurodollar Rate as provided in
subsection 2.2A.
"Event of Default" means each of the events set forth in
Section 8.
"Event of Loss" means, with respect to any property or asset,
(i) any loss, destruction or damage of such property or asset or (ii) any
condemnation, seizure or taking, by exercise of the power of eminent domain or
otherwise, of such property or asset, or confiscation or requisition of the use
of such property or asset.
"Excess Cash and Cash Equivalents" means, as of any date of
determination, the sum of Cash and Cash Equivalents held by Company and its
Subsidiaries on a consolidated basis as of such date less the greater of (x)
$25,000,000 or (y) five percent (5%) of gross revenues of Company and its
Subsidiaries on a consolidated basis for the consecutive four full Fiscal
Quarters most recently ended on or prior to such date, determined in accordance
with GAAP.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
"Excluded Person" means (a) Company or any Guarantor
wholly-owned by Company, (b) any employee benefit plan of Company or any
Guarantor wholly-owned by Company or any trustee or similar fiduciary holding
capital stock of Company for or pursuant to the terms of any such plan, (c) ▇▇▇▇
▇▇▇▇▇▇▇, (d) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, (e) ▇▇▇▇▇ ▇▇▇▇▇▇▇, (f) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, (g) ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, (h) ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, (i) ▇▇▇ ▇▇▇▇▇▇▇, (j) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
(k) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and (l) members of the immediate families and Affiliates of
any such Person (where the determination of whether a Person is an Affiliate is
made without reference to clause (ii) of the definition of such term).
14
"Excluded Subsidiary" means any Subsidiary of Company existing
as of the date hereof or hereafter created the total assets of which do not
have, at any date of determination, either a book value or fair market value in
excess of $1,000,000.
"Facilities" means, collectively, the Illinois Facilities,
the Louisiana Facilities and the Nevada Facilities.
"Federal Funds Effective Rate" means, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by Agent from three Federal funds brokers of
recognized standing selected by Administrative Agent.
"Fee Letter" means that certain letter, dated March 15, 1995,
executed by the Managing Agents and Company with respect to the payment of
certain fees in connection with the Commitments.
"FF&E" means any and all furniture, fixtures and equipment
which have been installed or are to be installed and used in connection with the
operation of the Improvements located upon any of the Premises and those items
of furniture, fixtures and equipment which have been purchased or leased or are
hereafter purchased or leased in connection with any of the Facilities.
"FIB" has the meaning assigned to that term in the first
paragraph of this Agreement.
"Fiscal Quarter" means the calendar quarters ending on March
31, June 30, September 30 and December 31.
"Fiscal Year" means the fiscal year period beginning April 1
of each calendar year and ending on the following March 31.
"Fixed Charge Coverage Ratio" means, as of any date of
determination, the ratio of (y) Consolidated EBIDTA for the consecutive four
full Fiscal Quarters most recently ended on or before such date of determination
to (z) Consolidated Fixed Charges for such four Fiscal Quarter period.
"Flood Act" means the National Flood Insurance Act of 1968 as
amended by the Flood Disaster Protection Act of 1973 (42 U.S.C. ▇▇.▇▇.
4013 et. seq.).
"Former Lender" has the meaning assigned to that term in
subsection 10.1B(iii).
15
"Funding and Payment Office" means the office of
Administrative Agent located at the address set forth on the signature pages
hereof.
"Funding Date" means the date of the funding of a Loan or the
issuance of a Letter of Credit.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting principles
set forth in opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, in each case as the same are applicable to the
circumstances as of the date of determination.
"Gaming Authority" means any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
the United States federal or foreign government, any state, province or any city
or other political subdivision or otherwise and whether now or hereafter in
existence, or any officer or official thereof, including, without limitation,
the Illinois Gaming Authorities, the Louisiana Gaming Authorities and the Nevada
Gaming Authorities, with authority to regulate any gaming operation (or proposed
gaming operation) owned, managed or operated by Company, any of its Subsidiaries
or any New Venture.
"Gaming Laws" means all statutes, rules, regulations,
ordinances, codes and administrative or judicial precedents pursuant to which
any Gaming Authority possesses regulatory, licensing or permit authority over
gambling, gaming or casino activities conducted by Company and its Subsidiaries
within its jurisdiction, including the Illinois Riverboat Gambling Act, the
Louisiana Riverboat Economic Development and Gaming
Control Act and the Nevada Gaming Control Act.
"Governmental Acts" has the meaning assigned to that term in
subsection 3.5A.
"Governmental Authority" means any of the United States
government, the government of any state thereof and any political subdivision,
agency, department, commission, court, board, bureau or instrumentality of any
of them, including any local authorities and any Gaming Authority.
"Governmental Authorization" means any permit, license,
authorization, plan, directive, consent, order or consent decree of or from any
Governmental Authority, including any Gaming Authority.
"Guarantor" means any of PLC, SIRCC, PBD, PNEV, PRM, PRI,
PMGC, PII, PRLLC, PML, RBI and SSP and "Guarantors" means all of them,
collectively;
16
provided, however, that "Guarantors" shall also mean any Person that becomes a
Subsidiary of Company after the Closing Date and is not an Excluded Subsidiary.
"Guaranty" means the Guaranty dated the Closing Date executed
by each Guarantor in favor of Administrative Agent, substantially in the form of
Exhibit XV annexed hereto, as it may hereafter be amended, supplemented or
otherwise modified, from time to time, including, without limitation, by the
inclusion as Guarantors of Persons (other than Excluded Subsidiaries) becoming
Subsidiaries of Company after the Closing Date.
"Hazardous Materials" means (i) any chemical, material or
substance at any time defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials", "extremely hazardous
waste", "restricted hazardous waste", "infectious waste", "toxic substances" or
any other formulations intended to define, list or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, toxicity, reproductive toxicity, "TCLP toxicity" or "EP
toxicity" or words of similar import under any applicable Environmental Laws or
publications promulgated pursuant thereto; (ii) any oil, petroleum, petroleum
fraction or petroleum derived substance; (iii) any drilling fluids, produced
waters and other wastes associated with the exploration, development or
production of crude oil, natural gas or geothermal resources; (iv) any flammable
substances or explosives; (v) any radioactive materials; (vi) asbestos in any
form; (vii) urea formaldehyde foam insulation; (viii) electrical equipment which
contains any oil or dielectric fluid containing levels of polychlorinated
biphenyls in excess of fifty parts per million; (ix) pesticides; and (x) any
other chemical, material or substance, exposure to which is prohibited, limited
or regulated by any governmental authority or which may or could pose a hazard
to the health and safety of the owners, occupants or any Persons in the vicinity
of the Facilities.
"Hostile Acquisition" means any acquisition of the outstanding
Securities or capital stock of any corporation, partnership or other Person that
is not an Affiliate of Company other than (i) an acquisition which has been
approved by resolutions of the Board of Directors of the Person being acquired
or by similar action if the Person is not a corporation, and as to which such
approval has not been withdrawn, or (ii) any acquisition of less than twenty
percent (20%) of the outstanding Securities of any class or type of any Person;
provided that an acquisition of Securities described in clause (ii) hereof as to
which Company or any of its Subsidiaries is required to file a statement
containing the information required by Schedule 13D under the Exchange Act shall
not be considered a Hostile Acquisition only if the then currently effective
Schedule 13D of Company or such Subsidiary indicates that Company or such
Subsidiary views the Securities as an attractive Investment and that Company or
such Subsidiary has no plans or proposals which relate to or which would result
in any of the transactions described in paragraphs (b) through (j) of Item 4 of
Schedule 13D.
"Illinois Facilities" means the Illinois Premises and the
Improvements made thereon, along with all other related personal and mixed
property located thereon
17
or related thereto, including, without limitation, a four-deck side-▇▇▇▇▇▇▇
riverboat casino (the "Metropolis Riverboat"), a docking site (including all
Barges), a cabaret style theater, all related restaurant, bar, recreation and
other facilities and all FF&E and other personal property located therein, as
more fully described on pages 26 and 27 of the Memorandum.
"Illinois Gaming Authorities" means, without limitation, the
Illinois Gaming Board and any other applicable Governmental Authority involved
in the regulation of gaming and gaming activities conducted by Company or any of
its Subsidiaries in the State of Illinois.
"Illinois Mortgage" means that certain Mortgage, Fixture
Filing and Security Agreement with Assignment of Rents, by and among SIRCC, as
mortgagor and owner, in favor of Administrative Agent, as mortgagee, dated the
Closing Date, substantially in the form of Exhibit XIII-A annexed hereto, as it
may hereafter be amended, supplemented or otherwise modified, from time to time.
"Illinois Premises" means the real property owned in fee or
leased by Company or its respective Subsidiaries with respect to the property
commonly known as the Metropolis complex in Metropolis, Illinois, as more fully
described on Schedule A-1 hereto.
"Illinois Riverboat Gambling Act" means the Riverboat Gambling
Act of Illinois, as from time to time amended, or any successor provision of
law, and the regulations promulgated thereunder.
"Illinois Ships" means each of the Metropolis Riverboat and
any other riverboat casino subsequently acquired by Company or any of its
Subsidiaries and operated out of the Illinois Facilities, in each case,
including the engines, boilers, machinery, masts, derricks, drawworks, spars,
boats, anchors, cables, chains, tackle, fittings, pumping equipment and all
other components and appurtenances thereto, whether now owned or hereafter
acquired, whether on board or not, and whether installed by Company, SIRCC or
any other Person, and also any and all changes, improvements, alterations,
additions, renewals and replacements at any time made in or to such units or any
parts thereof.
"Improvements" means all buildings, structures, facilities and
other improvements of every kind and description now or hereafter located on any
of the Premises, including all parking areas, roads, driveways, walks, fences,
walls, beams, recreation facilities, drainage facilities, lighting facilities
and other site improvements, all water, sanitary and storm sewer, drainage,
electricity, steam, gas, telephone and other utility equipment and facilities,
all plumbing, lighting, heating, ventilating, air-conditioning, refrigerating,
incinerating, compacting, fire protection and sprinkler, surveillance and
security, vacuum cleaning, public address and communications equip- ment and
systems, all screens, awnings, floor coverings, partitions, elevators,
escalators,
18
motors, machinery, pipes, fittings and other items of equipment and personal
property of every kind and description now or hereafter located on any of the
Premises or attached to the improvements that by the nature of their location
thereon or attachment thereto are real property under applicable law; and
including all materials intended for the construction, reconstruction, repair,
replacement, alteration, addition or improvement of or to such buildings,
equipment, fixtures, structures and improvements.
"Indebtedness", as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) that portion of obligations with respect
to Capital Leases that is properly classified as a liability on a balance sheet
in conformity with GAAP, (iii) notes payable and drafts accepted representing
extensions of credit whether or not representing obligations for borrowed money,
(iv) any obligation owed for all or any part of the deferred purchase price of
property or services (excluding any such obligations incurred under ERISA),
which purchase price is (a) due more than six months from the date of incurrence
of the obligation in respect thereof or (b) evidenced by a note or similar
written instrument, and (v) all indebtedness secured by any Lien on any property
or asset owned or held by that Person regardless of whether the indebtedness
secured thereby shall have been assumed by that Person or is nonrecourse to the
credit of that Person. Any Contingent Obligation shall not constitute
Indebtedness until such time as, and only to the extent that, the underlying
obligation owed by the primary obligor to which such Contingent Obligation
relates has become due and payable and remains unsatisfied after the due date
thereof. Obligations under Interest Rate Agreements constitute Contingent
Obligations.
"Indemnitee" has the meaning assigned to that term in
subsection 10.3.
"Indenture" means that certain Indenture, dated as of April
10, 1995, executed by Company, its Subsidiaries and First Fidelity Bank,
National Association, as trustee, in connection with the issuance of and
governing the terms of the Senior Notes, as in effect on the Closing Date,
except to the extent amended in accordance with subsection 7.13.
"Intellectual Property" means all patents, trademarks,
tradenames, copyrights, technology, know-how and processes used in or necessary
for the conduct of the business of Company and its Subsidiaries as currently
conducted that are material to the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Company and its Subsidiaries,
taken as a whole.
"Interest Payment Date" means (i) with respect to any Base
Rate Loan, each March 31, June 30, September 30 and December 31 of each year,
commencing on the first such date to occur after the Closing Date, and (ii) with
respect to any Eurodollar Rate Loan, the last day of each Interest Period
applicable to such Loan; provided that in the case of each Interest Period of
longer than three months, "Interest Payment Date" shall also include each date
that is three months after the commencement of such Interest Period.
19
"Interest Period" has the meaning assigned to that term in
subsection 2.2B.
"Interest Rate Agreement" means any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or other
similar agreement or arrangement designed to protect Company or any of its
Subsidiaries against fluctuations in interest rates.
"Interest Rate Determination Date" means, with respect to any
Interest Period, the second Business Day prior to the first day of such Interest
Period.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter.
"Investment" means (i) any direct or indirect purchase or
other acquisition by Company or any of its Subsidiaries of, or of a beneficial
interest in, any Securities of any other Person, (ii) any direct or indirect
redemption, retirement, purchase or other acquisition for value, by any
Subsidiary of Company from any Person other than Company or any of its
Subsidiaries, of any equity Securities of such Subsidiary, or (iii) any direct
or indirect loan, advance (other than advances to employees for moving,
entertainment and travel expenses, drawing accounts and similar expenditures in
the ordinary course of business) or capital contribution by Company or any of
its Subsidiaries to any other Person, including all indebtedness and accounts
receivable from that other Person that are not current assets or did not arise
from sales to that other Person in the ordinary course of business. The amount
of any Investment shall be the original cost of such Investment plus the cost of
all additions thereto, without any adjustments for increases or decreases in
value, or write-ups, write-downs or write-offs with respect to such Investment.
"Investment Measurement Period" means, at any date of
determination, the twelve consecutive month period ending with the month
immediately prior to the month in which Company's direct or indirect investment
in any New Venture exceeds $500,000.
"Joint Venture" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal form;
provided that in no event shall any corporate Subsidiary of any Person be
considered to be a Joint Venture to which such Person is a party.
"Landlord Consents" means those certain Landlord's Consents
and Agreements executed by various owners of certain portions of the Premises,
as landlords, each in favor of Administrative Agent, acknowledging and
consenting to, among other things, the granting by certain of Company's
Subsidiaries, as tenants, of Mortgages on the leasehold interests held by such
tenants.
"Lease Amendments" means those certain amendments to lease
agreements between various owners of certain portions of the Premises, each as a
landlord, and
20
certain of Company's Subsidiaries, each as a tenant, pursuant to which the
parties thereto have amended certain existing leases related to the Premises for
the benefit of Administrative Agent.
"Leasehold Documents" means, collectively, the Mortgagee
Attornment Agreements, the Landlord Consents, the Lease Amendments and the
Acknowledgement and Estoppel Agreements.
"Lender" and "Lenders" means the persons identified as
"Lenders" and listed on the signature pages of this Agreement, together with
their successors and permitted assigns pursuant to subsection 10.1, and the term
"Lenders" shall include Swing Line Lender unless the context otherwise requires.
"Lender Assignment Agreement" has the meaning assigned to that
term in subsection 10.1A and a form of which is attached as Exhibit V hereto, as
noted in subsection 10.1B.
"Letter of Credit" or "Letters of Credit" means Standby
Letters of Credit issued or to be issued by Administrative Agent for the account
of Company pursuant to subsection 3.1.
"Letter of Credit Usage" means, as at any date of
determination, the sum of (i) the maximum aggregate amount which is or at any
time thereafter may become available for drawing under all Letters of Credit
then outstanding plus (ii) the aggregate amount of all drawings under Letters of
Credit honored by Administrative Agent and not theretofore reimbursed by Company
(including any such reimbursement out of the proceeds of Loans pursuant to
subsection 3.3B).
"Leverage Ratio" means, as of any date of determination, the
ratio of (y) the sum (without duplication) of the outstanding principal amount
of Other Allowed Indebtedness (Secured) as of such date plus the outstanding
principal amount of Other Allowed Indebtedness (Unsecured) as of such date plus
the average daily Total Utilization of Commitments for the Fiscal Quarter most
recently ended on or prior to such date plus Contingent Obligations as of such
date to (z) Consolidated EBIDTA for the consecutive four full Fiscal Quarters
most recently ended on or prior to such date.
"License Revocation" means the revocation, failure to renew or
suspension of, or the appointment of a receiver, supervisor or similar official
with respect to, any casino, gambling or gaming license issued by any Gaming
Authority covering any casino, gambling or gaming facility owned or operated by
Company, any of its Subsidiaries or any New Venture.
"Lien" means any lien, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title
21
retention agreement, any lease in the nature thereof, and any agreement to give
any security interest) and any option, trust or other preferential arrangement
having the practical effect of any of the foregoing.
"LLC Membership Interest Security Agreements" means those
certain Security Agreements between each of PRI and PRM, and Administrative
Agent, dated the Closing Date, substantially in the form of Exhibit XI-B annexed
hereto, respectively, as each such agreement may hereafter be amended,
supplemented or otherwise modified, from time to time.
"Loan Documents" means this Agreement, any Notes, the Letters
of Credit (and any applications for, or reimbursement agreements or other
documents or certificates executed by Company in favor of Administrative Agent
relating to, the Letters of Credit), the Collateral Account Agreement, the
Collateral Documents and all other instruments or documents executed in
connection therewith.
"Loan Exposure" means, with respect to any Lender as of any
date of determination (i) prior to the termination of the Commitments, that
Lender's Commitment and (ii) after the termination of the Commitments, the sum
of (a) the aggregate outstanding principal amount of the Loans of that Lender
plus (b) in the event that Lender is Administrative Agent, the aggregate Letter
of Credit Usage in respect of all Letters of Credit issued by that Lender (in
each case net of any participations purchased by other Lenders in such Letters
of Credit or any unreimbursed drawings thereunder) plus (c) the aggregate amount
of all participations purchased by that Lender in any outstanding Letters of
Credit or any unreimbursed drawings under any Letters of Credit plus (d) in the
case of Swing Line Lender, the aggregate outstanding principal amount of all
Swing Line Loans (net of any participations therein purchased by other Lenders)
plus (e) the aggregate amount of all participations purchased by that Lender in
any outstanding Swing Line Loans.
"Loan Party" means any of Company and any Guarantor and "Loan
Parties" means Company and all Guarantors, collectively.
"Loans" means, collectively, all Revolving Loans made pursuant
to subsection 2.1A and all Swing Line Loans made pursuant to subsection 2.1B.
"Louisiana Facilities" means the Louisiana Premises and the
Improvements made thereon, along with all other related personal and mixed
property located thereon or related thereto, including, without limitation, two
four-deck side-▇▇▇▇▇▇▇ riverboat casinos (individually known as the "Players
Lake ▇▇▇▇▇▇▇ Riverboat" and the "Lake ▇▇▇▇▇▇▇ Star Riverboat"), a docking site
(including all Barges), a hotel, all related restaurant, bar, recreation and
other facilities and all FF&E and other personal property located therein, as
more fully described on pages 27 and 28 of the Memorandum.
22
"Louisiana Gaming Authorities" means, without limitation, the
Louisiana Riverboat Gaming Commission, the Riverboat Gaming Enforcement Division
of the Louisiana State Police and any other applicable Governmental Authority
involved in the regulation of gaming and gaming activities conducted by Company
or any of its
Subsidiaries in the State of Louisiana.
"Louisiana Gaming Control Act" means the Louisiana Riverboat
Economic Development and Gaming Control Act, as from time to time amended, or
any successor provision of law, and the regulations promulgated thereunder.
"Louisiana Mortgage" means that certain Acts of Mortgage,
Fixture Filing and Security Agreement with Pledge and Assignment of Leases and
Rents, among PLC, as mortgagor and owner, in favor of Administrative Agent, as
mortgagee, dated the Closing Date, substantially in the form of Exhibit XIII-B
annexed hereto, as it may hereafter be amended, supplemented or otherwise
modified, from time to time.
"Louisiana Premises" means the real property owned in fee or
leased by Company or its respective Subsidiaries with respect to the property
commonly known as the Lake ▇▇▇▇▇▇▇ complex in Lake Charles, Louisiana, as more
fully described on Schedule A-2 hereto.
"Louisiana Ships" means each of the Players Lake ▇▇▇▇▇▇▇
Riverboat, the Lake ▇▇▇▇▇▇▇ Star Riverboat and any other riverboat casino
subsequently acquired by Company or any of its Subsidiaries and operated out of
the Louisiana Facilities, in each case, including the engines, boilers,
machinery, masts, derricks, drawworks, spars, boats, anchors, cables, chains,
tackle, fittings, pumping equipment and all other components and appurtenances
thereto, whether now owned or hereafter acquired, whether on board or not, and
whether installed by Company, PLC or any other Person, and also any and all
changes, improvements, alterations, additions, renewals and replacements at any
time made in or to such units or any parts thereof.
"Managing Agent" means either of FIB or BTCo and "Managing
Agents" means FIB and BTCo, collectively.
"Margin Stock" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System as in
effect from time to time.
"Marine Appraiser" means ▇▇▇▇▇ ▇▇▇▇▇▇.
"Maryland Heights Facility" means the riverboat casino
entertainment complex in Maryland Heights, Missouri intended to be developed and
operated by the Riverside Joint Venture.
"Material Adverse Effect" means (i) a material adverse effect
upon the business, operations, properties, assets, condition (financial or
otherwise) or prospects of
23
Company and its Subsidiaries, taken as a whole, or (ii) the impairment of the
ability of Company to perform, in any material respect, or of Administrative
Agent or Lenders to enforce, the Obligations.
"Memorandum" means Company's Confidential Offering Memorandum,
dated April 10, 1995, with respect to its issuance of 10-7/8% Senior Notes Due
2005.
"Mortgagee Attornment Agreements" means those certain
Mortgagee Attornment Agreements between various owners of certain portions of
the Premises, each as a landlord, and certain of Company's Subsidiaries, each as
a tenant, for the benefit of Administrative Agent, granting tenants the right to
mortgage the leasehold interests held by such tenants in certain portions of the
Premises.
"Mortgages" means, collectively, the Illinois Mortgage, the
Louisiana Mortgage and the Nevada Mortgages.
"Multiemployer Plan" means a "multiemployer plan", as defined
in Section 3(37) of ERISA, to which Company or any of its ERISA Affiliates is
contributing, or ever has contributed, or to which Company or any of its ERISA
Affiliates has, or ever has had, an obligation to contribute.
"Net Cash Proceeds" means Cash Proceeds received from any
Asset Sale or upon the occurrence of an Event of Loss, in each case, net of the
sum of all bona fide direct fees, commissions and other expenses incurred in
connection therewith less the amount of (estimated reasonably and in good faith
by Company) income, franchise, sales and other applicable taxes required to be
paid by Company or any of its Subsidiaries as a result thereof within two years
of the date of receipt of any such Cash Proceeds.
"Nevada Facilities" means the Nevada Premises and the
Improvements made thereon, along with all other related resort-facilities
personal and mixed property under construction thereon, including, without
limitation, a golf course, all related restaurant, bar, recreation and other
facilities and all FF&E and other personal property located therein, as more
fully described on pages 28 and 29 of the Memorandum.
"Nevada Gaming Authorities" means, without limitation, the
Nevada Gaming Commission, the Nevada State Gaming Control Board and any other
applicable Governmental Authority involved in the regulation of gaming and
gaming activities conducted by Company or any of its Subsidiaries in the State
of Nevada.
"Nevada Gaming Control Act" means the Nevada Gaming Control
Act, as from time to time amended, or any successor provision of law, and the
regulations promulgated thereunder.
"Nevada Mortgages" means those certain Deeds of Trust, Fixture
Filings and Security Agreements with Assignment of Rents, among each of PNEV,
PMGC and
24
PML, as trustor and owner, in favor of Chicago Title Insurance Company, as
trustee, for the benefit of Administrative Agent, as beneficiary, each dated the
Closing Date, substantially in the form of Exhibit XIII-C annexed hereto, as any
of them may hereafter be amended, supplemented or otherwise modified, from time
to time.
"Nevada Premises" means the real property owned in fee or
leased by Company or its respective Subsidiaries with respect to the property in
Mesquite, Nevada, as more fully described on Schedule A-3 hereto.
"New Venture" means a casino, hotel, casino/hotel, resort,
casino/resort, riverboat casino, dock casino, any other type of casino, golf
course, entertainment center or similar facility (or any site or proposed site
for any of the foregoing) owned or to be owned in whole or in part by any New
Venture Subsidiary (or owned or to be owned by a Person in which Company or a
New Venture Subsidiary is an owner or investor); provided that a Development
Proposal shall not be deemed to constitute a New Venture until such time, if
any, as it becomes a Development Commitment.
"New Venture Investments" means any capitalization,
Investment, loan, distribution or advance of any kind or character whatsoever
made by Company or any of its Subsidiaries in or to any New Venture or New
Venture Subsidiary.
"New Venture Subsidiary" means PMH and any Subsidiary of
Company created after the Closing Date principally to hold, directly or
indirectly, an interest in a casino, hotel, casino/hotel, resort, casino/resort,
riverboat casino, dock casino, any other type of casino, golf course,
entertainment center or similar facility (or any site or proposed site for any
of the foregoing).
"Notes" means any promissory notes of Company issued pursuant
to subsection 2.1E to evidence the Revolving Loans or Swing Line Loans,
substantially in the form of Exhibit VI or Exhibit VII, respectively, annexed
hereto, as they may be amended, supplemented or otherwise modified from time to
time.
"Notice of Borrowing" means a notice substantially in the form
of Exhibit I annexed hereto delivered by Company to Administrative Agent
pursuant to subsection 2.1C with respect to a proposed borrowing.
"Notice of Conversion/Continuation" means a notice
substantially in the form of Exhibit III annexed hereto delivered by Company to
Administrative Agent pursuant to subsection 2.2D with respect to a proposed
conversion or continuation of the applicable basis for determining the interest
rate with respect to the Loans specified therein.
"Notice of Issuance of Letter of Credit" means a notice
substantially in the form of Exhibit IV annexed hereto delivered by Company to
Administrative Agent
25
pursuant to subsection 3.1B(i) with respect to the proposed issuance of a
Letter of Credit.
"Notification Date" has the meaning assigned to that term in
subsection 3.1A(iii).
"Obligations" means all obligations of every nature of any
Loan Party, from time to time owed to Administrative Agent, Managing Agents,
Co-Arrangers, Lenders or any of them under the Loan Documents, whether for
principal, interest, reimbursement of amounts drawn under Letters of Credit,
fees, expenses, indemnification or otherwise.
"Officers' Certificate" means, as applied to any corporation,
a certificate executed on behalf of such corporation by its chairman of the
board (if an officer) or president, vice presidents, chief financial officer or
treasurer; provided that every Officers' Certificate with respect to the
compliance with a condition precedent to the making of any Loans hereunder shall
include (i) a statement that the officer or officers making or giving such
Officers' Certificate have read such condition and any definitions or other
provisions contained in this Agreement relating thereto, (ii) a statement that,
in the opinion of the signers, they have made or have caused to be made such
examination or investigation as is necessary to enable them to express an
informed opinion as to whether or not such condition has been complied with, and
(iii) a statement as to whether, in the opinion of the signers, such condition
has been complied with.
"Other Allowed Indebtedness (Secured)" means (a) secured
Interest Rate Agreements with Lenders having a maximum notional amount of no
more than $40,000,000, (b) Purchase Money Debt and Capital Leases not to exceed
$5,000,000 in aggregate principal amount, existing on the Closing Date, (c)
Purchase Money Debt and Capital Leases not to exceed $10,000,000 principal
amount at any time outstanding for each New Venture Subsidiary and for the
operation of the Nevada Facilities and (d) Purchase Money Debt and Capital
Leases of Persons that are acquired in acquisitions and purchases permitted by
subsection 7.7; provided such Purchase Money Debt and Capital Leases were not
incurred in contemplation of such acquisition.
"Other Allowed Indebtedness (Unsecured)" means all unsecured
Indebtedness, whether existing on the Closing Date or subsequently incurred, of
Company or any of its Subsidiaries, including, without limitation, the Senior
Notes.
"Other Barges" means all barges located at or used in
connection with the Illinois Facilities or the Louisiana Facilities other than
US Documented Barges, whether owned on the date hereof or subsequently acquired,
including, without limitation, all barges that are documented, registered or
certified pursuant to the laws of the State of Illinois or the State of
Louisiana.
"Participant Subsidiary" has the meaning assigned to that
term in subsection 6.10B.
26
"Partnership Interest Security Agreements" means those certain
Security Agreements between each of PRLLC and PRM, and Administrative Agent,
dated the Closing Date, substantially in the form of Exhibit XVIII annexed
hereto, respectively, as each such agreement may hereafter be amended,
supplemented or otherwise modified, from time to time.
"PBD" means Players Bluegrass Downs, Inc., a Kentucky
corporation.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor thereto).
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"Permitted Encumbrances" means the following types of Liens
(other than any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of
the Internal Revenue Code or by ERISA):
(i) Liens for taxes, assessments or governmental charges
or claims the
payment of which is not, at the time, required by subsection 6.3;
(ii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics and materialmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent
or being contested in good faith, if such reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been made
therefor;
(iii) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds,
bids, leases, government contracts, trade contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(iv) any attachment or judgment Lien not constituting an
Event of Default under subsection 8.8;
(v) leases or subleases granted to others (including, without
limitation, any Subsidiary of Company) not interfering in any material
respect with the ordinary conduct of the business of Company or any of
its Subsidiaries; and
(vi) easements, rights-of-way, restrictions, minor defects,
encroachments or irregularities in title and other similar immaterial
charges or encumbrances that (a) arise prior to the Closing Date and
are accepted by Managing Agents as
27
exceptions to the Title Policies or (b) arise after the Closing Date
and would not, either individually or in the aggregate, result in a
Material Adverse Effect.
"Person" means and includes natural persons, corporations,
limited partnerships, general partnerships, joint stock companies, Joint
Ventures, associations, companies, trusts, banks, trust companies, land trusts,
business trusts, limited liability companies or other organizations, whether or
not legal entities, and governments and agencies and political subdivisions
thereof.
"PII" means Players Indiana, Inc., an Indiana corporation.
"PLC" means Players Lake ▇▇▇▇▇▇▇, Inc., a Louisiana
corporation.
"PMGC" means Players Mesquite Golf Club, Inc., a Nevada
corporation.
"PMH" means Players Maryland Heights, Inc., a Missouri
corporation.
"PMHLP" means Players MH, L.P., a Missouri limited
partnership.
"PMHN" means Players Maryland Heights Nevada, Inc., a Nevada
corporation.
"PML" means Players Mesquite Land, Inc., a Nevada corporation.
"PNEV" means Players Nevada, Inc., a Nevada corporation.
"Policies of Insurance" means the insurance required to be
obtained and maintained by Company throughout the term of this Agreement
pursuant to subsection 6.4B hereof and Schedules 6.4(a) and 6.4(b) annexed
hereto.
"Potential Event of Default" means a condition or event that,
after notice or lapse of time or both, would constitute an Event of Default.
"Premises" means, collectively, the Illinois Premises, the
Louisiana Premises and the Nevada Premises.
"PRI" means Players Riverboat, Inc., a Nevada corporation.
"Pricing Determination Certificate" means an Officers'
Certificate of Company delivered on the Closing Date pursuant to subsection 4.1Q
and thereafter pursuant to subsection 6.1(xvi) setting forth in reasonable
detail the Leverage Ratio which is applicable as of the date on which such
Officers' Certificate is delivered.
"Prime Rate" means the rate that FIB announces from time to
time as its prime rate. The Prime Rate is a reference rate and does not
necessarily represent the
28
lowest or best rate actually charged to any customer. FIB or any other Lender
may make commercial loans or other loans at rates of interest at, above or below
the Prime Rate.
"PRLLC" means Players Riverboat, LLC, a Louisiana limited
liability company.
"PRM" means Players Riverboat Management, Inc., a Nevada
corporation.
"Pro Rata Share" means, with respect to each Lender, the
percentage obtained by dividing (x) the Commitment of that Lender by (y) the
aggregate Commitments of all Lenders, as such percentage may be adjusted by
assignments permitted pursuant to subsection 10.1. The initial Pro Rata Share of
each Lender is set forth opposite the name of that Lender in Schedule 2.1
annexed hereto.
"Purchase Money Debt" means Indebtedness incurred to finance
the acquisition of assets pertaining to any business reasonably related to any
of Company's or its Subsidiaries' gaming business and necessary for, in support
or anticipation of and ancillary to or in preparation for such gaming business
provided that the amount of such Indebtedness does not exceed eighty percent
(80%) of the purchase price of the asset acquired and provided further that such
Indebtedness is incurred at the time of, or within 30 days following, such
acquisition and provided still further that any Lien securing such Indebtedness
shall attach only to the asset acquired and not to any other asset of the
obligor of such Indebtedness.
"Purchaser" has the meaning assigned to that term in
subsection 6.10D.
"Railroad" has the meaning assigned to that term in
subsection 6.10D.
"RBI" means River Bottom, Inc., a Missouri corporation.
"Reduction Commencement Date" means the last day of the first
calendar quarter occurring after the second anniversary of the Closing Date, as
it may be extended pursuant to subsection 2.1F.
"Refunded Swing Line Loans" has the meaning assigned to that
term in subsection 2.1B.
"Refusing Lender" has the meaning assigned to that term in
subsection 2.1F.
"Regulation D" means Regulation D of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
29
"Reimbursement Date" has the meaning assigned to that term in
subsection 3.3B.
"Related Business" means the gaming business (including
parimutuel betting) conducted (or proposed to be conducted) by Company and its
Subsidiaries as of the Closing Date and any and all reasonably related
businesses necessary for, in support or anticipation of and ancillary to or in
preparation for, the gaming business including, without limitation, the
development, expansion or operation of any casino, hotel, casino/hotel, resort,
casino/resort, riverboat casino, dock casino, any other type of casino, golf
course, retail facility, entertainment center or similar facility.
"Release" means any release, spill, emission, leaking,
pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal,
dumping, leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including, without limitation, the abandonment or disposal of any
barrels, containers or other closed receptacles containing any Hazardous
Materials), or into or out of any Facility, including the movement of any
Hazardous Material through the air, soil, surface water, groundwater or
property.
"Requisite Lenders" means Lenders having or holding sixty-six
and two-thirds percent (66-2/3%) of the Loan Exposure, or if no Loans or Letters
of Credit are outstanding, having sixty-six and two-thirds percent (66-2/3%) of
the Commitments.
"Responsible Officer" means each of the following officers of
Company or any of its Subsidiaries, at the time that any individual holds any
such position: the chief executive officer, the president, the chief financial
officer, the treasurer, any vice president, the general counsel and the
corporate secretary.
"Restricted Payment" means (i) any dividend or other
distribution of items of distribution, direct or indirect, on account of any
class of stock of Company in Company now or hereafter outstanding, except a
distribution payable solely in interests of that class of stock to the holders
of that class, (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any interests of
any class of stock of Company now or hereafter outstanding, (iii) any payment
made to retire, or to obtain the surrender of, any outstanding warrants, options
or other rights to acquire any interests of any class of stock of Company now or
hereafter outstanding, (iv) any payment or prepayment of principal of, premium,
if any, or interest on, or redemption, purchase, retirement, defeasance
(including in substance or legal defeasance), sinking fund or similar payment
with respect to, any subordinated indebtedness, and (v) any payment or
prepayment of principal of, premium, if any, or redemption, purchase, retirement
or defeasance (including in substance or legal defeasance) of the outstanding
principal of any of the Senior Notes other than as required under the Indenture
(after giving effect to any mandatory prepayment pursuant to subsection
2.4A(ii)) upon the occurrence of an Asset Sale or an Event of Loss.
30
"Revolving Loans" means the loans made by Lenders pursuant to
subsection 2.1.
"Revolving Note" means any promissory note of Company issued
pursuant to subsection 2.1E to evidence the Revolving Loans of a Lender,
substantially in the form of Exhibit VI annexed hereto, as it may be amended,
supplemented or otherwise modified from time to time.
"Riverside Joint Venture" means that certain Joint Venture
between PMHLP and ▇▇▇▇▇▇'▇ Maryland Heights Corporation, a Nevada corporation,
for the development and operation of a riverboat casino entertainment complex in
Maryland Heights, Missouri, as more fully described on page 29 of the
Memorandum.
"Securities" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"Senior Notes" has the meaning assigned to that term in the
first recital to this Agreement.
"Ship Mortgages" means the First Preferred Ship Mortgages by
each of SIRCC, PLC and SSP in favor of the Trustee, for the benefit of
Administrative Agent on behalf of Lenders, substantially in the form of Exhibit
XIV annexed hereto, as such mortgages may hereafter be amended, supplemented or
otherwise modified, from time to time.
"Ships" means, collectively, the Illinois Ships and the
Louisiana Ships.
"SIRCC" means Southern Illinois Riverboat/Casino Cruises,
Inc., an Illinois corporation.
"Solvent" means, with respect to any Person, that as of the
date of determination both (A)(i) the then fair saleable value of the property
of such Person is (y) greater than the total amount of liabilities (including
contingent liabilities with respect to Indebtedness) of such Person and (z) not
less than the amount that will be required to pay the probable liabilities on
such Person's then existing debts as they become absolute and matured
considering all financing alternatives and potential asset sales reasonably
available to such Person; (ii) such Person's capital is not unreasonably
31
small in relation to its business or any contemplated or undertaken transaction;
and (iii) such Person does not intend to incur, or believe (nor should it
reasonably believe) that it will incur, debts beyond its ability to pay such
debts as they become due; and (B) such Person is "solvent" within the meaning
given that term and similar terms under applicable laws relating to fraudulent
transfers and conveyances. For purposes of this definition, the amount of any
contingent liability at any time shall be computed as the amount that, in light
of all of the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured liability.
"SSP" means Showboat Star Partnership, a Louisiana general
partnership.
"Standby Letter of Credit" means any standby letter of credit
or similar instrument issued for the purpose of supporting (i) Indebtedness of
Company or any of its Subsidiaries in respect of industrial revenue or
development bonds or financings, (ii) workers' compensation liabilities of
Company or any of its Subsidiaries, (iii) the obligations of third party
insurers of Company or any of its Subsidiaries arising by virtue of the laws of
any jurisdiction requiring third party insurers, (iv) obligations with respect
to Capital Leases or Operating Leases of Company or any of its Subsidiaries, and
(v) performance, payment, deposit or surety obligations of Company or any of its
Subsidiaries, in any case if required by law or governmental rule or regulation
or in accordance with custom and practice in the industry; provided that Standby
Letters of Credit may not be issued for the purpose of supporting (a) trade
payables or (b) any Indebtedness constituting "antecedent debt" (as that term is
used in Section 547 of the Bankruptcy Code.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, association, joint venture or other business entity of
which more than 50% of the total voting power of shares of stock or other
ownership interests entitled (without regard to the occurrence of any
contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof.
"Subsidiary Security Agreements" means those certain Security
Agreement between certain of Company's Subsidiaries and Administrative Agent
dated the Closing Date, substantially in the forms of Exhibit XVII-A, Exhibit
XVII-B and Exhibit XVII-C annexed hereto, as it may hereafter be amended,
supplemented or otherwise modified, from time to time, including, without
limitation, by the inclusion of Subsidiaries of Company formed after the Closing
Date that are not Excluded Subsidiaries.
"Substitute Lender" has the meaning assigned to that term in
subsection 10.1B(iii).
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"Swing Line Lender" means Administrative Agent, or any Person
serving as a successor Administrative Agent hereunder, in its capacity as Swing
Line Lender hereunder.
"Swing Line Loan Commitment" means the commitment of Swing
Line Lender to make Swing Line Loans to Company pursuant to subsection 2.1B.
"Swing Line Loans" means the Loans made by Swing Line Lender
to Company pursuant to subsection 2.1B.
"Swing Line Note" means any promissory note of Company issued
pursuant to subsection 2.1E to evidence the Swing Line Loans of Swing Line
Lender, substantially in the form of Exhibit VII annexed hereto, as it may be
amended, supplemented or otherwise modified from time to time.
"Tax" or "Taxes" means any present or future tax, levy,
impost, duty, charge, fee, deduction or withholding of any nature and whatever
called, by any Governmental Authority, on whomsoever and wherever imposed,
levied, collected, withheld or assessed; provided that "Tax on the overall net
income" of a Person shall be construed as a reference to a tax imposed by any
Governmental Authority on all or part of the net income, profits or gains of
that Person (whether worldwide, or only insofar as such income, profits or gains
are considered to arise in or to relate to a particular jurisdiction, or
otherwise).
"Title Company" shall have the meaning assigned to such term
in subsection 4.1G.
"Title Policy" shall have the meaning assigned to such term in
subsection 4.1G.
"Total Utilization of Commitments" means, as at any date of
determination, the sum of (i) the aggregate principal amount of all outstanding
Revolving Loans (other than Revolving Loans made for the purpose of repaying any
Refunded Swing Line Loans or reimbursing Administrative Agent for any amount
drawn under any Letter of Credit but not yet so applied) plus (ii) the aggregate
principal amount of all outstanding Swing Line Loans plus (iii) the Letter of
Credit Usage.
"Trust Agreement" means the Master Vessel and Collateral Trust
Agreement between the Trustee and Administrative Agent on behalf of Lenders,
substantially in the form of Exhibit XIX annexed hereto, as such agreement may
hereafter be amended, supplemented or otherwise modified from time to time.
"Trustee" means FIB, solely in its capacity as trustee under
the Trust Agreement and not in its individual capacity.
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"US Documented Barges" means all barges located at or used in
connection with the Illinois Facilities or the Louisiana Facilities, whether
owned on the date hereof or subsequently acquired, that are subject to a valid
certificate of documentation issued by the United States Coast Guard under the
laws and regulations of the United States and are listed on Schedule 5.5.
"Withdrawal Period" has the meaning assigned to that term in
subsection 10.1B(iii).
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations
Under Agreement.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Company to Lenders pursuant to clauses (i), (ii) and
(xiii) of subsection 6.1 shall be prepared in accordance with GAAP as in effect
at the time of such preparation (and delivered together with the reconciliation
statements provided for in subsection 6.1(iv)). Calculations in connection with
the definitions, covenants and other provisions of this Agreement shall utilize
accounting principles and policies in conformity with those used to prepare the
financial statements referred to in subsection 5.3.
1.3 Other Definitional Provisions.
References to "Sections" and "subsections" shall be to
Sections and subsections, respectively, of this Agreement unless otherwise
specifically provided. Any of the terms defined in subsection 1.1 may, unless
the context otherwise requires, be used in the singular or the plural, depending
on the reference.
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 Commitments; Making of Loans; Notes.
A. Revolving Loans. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of the Loan
Parties set forth in the Loan Documents, each Lender hereby severally agrees,
subject to the limitations set forth below with respect to the maximum amount of
Loans permitted to be outstanding from time to time, to lend to Company from
time to time during the period from the Closing Date to but excluding the
Commitment Termination Date an aggregate amount not exceeding its Pro Rata Share
of the aggregate amount of the Commitments to be used for the purposes
identified in subsection 2.5A. The original amount of each Lender's Commitment
is set forth opposite its name on Schedule 2.1 annexed hereto and the aggregate
original amount of the Commitments is $120,000,000; provided that the
Commitments of Lenders shall be adjusted to give effect to any assignments of
the
34
Commitments pursuant to subsection 10.1B; and provided further that the amount
of the Commitments shall be reduced from time to time by the amount of any
reductions thereto made pursuant to subsections 2.4A and 2.4B(ii). Each Lender's
Commitment shall expire on the Commitment Termination Date and all Revolving
Loans and all other amounts owed hereunder with respect to the Revolving Loans
and the Commitments shall be paid in full no later than that date. Loans made by
Lenders pursuant to this subsection 2.1A are described herein as "Revolving
Loans."
B. Swing Line Loans. Swing Line Lender hereby agrees, subject to the
limitations set forth below with respect to the maximum amount of Swing Line
Loans permitted to be outstanding from time to time and subject to the other
terms and conditions hereof, to make a portion of the Commitments available to
Company from time to time during the period from the Closing Date to but
excluding the Commitment Termination Date by making Swing Line Loans to Company
in an aggregate amount not exceeding the amount of the Swing Line Loan
Commitment to be used for the purposes identified in subsection 2.5A,
notwithstanding the fact that such Swing Line Loans, when aggregated with Swing
Line Lender's outstanding Revolving Loans and Swing Line Lender's Pro Rata Share
of the Letter of Credit Usage then in effect, may exceed Swing Line Lender's
Commitment. The original amount of the Swing Line Loan Commitment is $5,000,000;
provided that any reduction of the Commitments made pursuant to subsec- tion
2.4A or 2.4B(ii) which reduces the aggregate Commitments to an amount less than
the then current amount of the Swing Line Loan Commitment shall result in an
automatic corresponding reduction of the Swing Line Loan Commitment to the
amount of the Commitments, as so reduced, without any further action on the part
of Company or Swing Line Lender. The Swing Line Loan Commitment shall expire on
the fifth Business Day prior to the Commitment Termination Date and all Swing
Line Loans and all other amounts owed hereunder with respect to the Swing Line
Loans shall be paid in full no later than that date. Amounts borrowed under this
subsection 2.1B may be repaid and reborrowed to but excluding the fifth Business
Day prior to the Commitment Termination Date. Swing Line Lender shall not be
obligated to make any Swing Line Loans if it has elected not to do so after the
occurrence and during the continuation of a Potential Event of Default of which
it is aware or an Event of Default.
Anything contained in this Agreement to the contrary
notwithstanding, the Swing Line Loans and the Swing Line Loan Commitment shall
be subject to the limitation that in no event shall the Total Utilization of
Commitments at any time exceed the Commitments then in effect.
With respect to any Swing Line Loans which have not been
voluntarily prepaid by Company pursuant to subsection 2.4B(i), Swing Line Lender
may, at any time in its sole and absolute discretion, deliver to Lenders (with a
copy to Company), no later than 8:30 A.M. (Pacific time) on the first Business
Day in advance of the proposed Funding Date, a notice (which shall be deemed to
be a Notice of Borrowing given by Company) requesting Lenders to make Revolving
Loans that are Base Rate Loans on such Funding Date in an amount equal to the
amount of such Swing Line Loans (the
35
"Refunded Swing Line Loans") outstanding on the date such notice is given which
Swing Line Lender requests Lenders to prepay. Anything contained in this
Agreement to the contrary notwithstanding, (i) the proceeds of Revolving Loans
made by Lenders other than Swing Line Lender shall be immediately delivered to
Swing Line Lender (and not to Company) and applied to repay a corresponding
portion of the Refunded Swing Line Loans and (ii) on the day such Revolving
Loans are made, Swing Line Lender's Pro Rata Share of the Refunded Swing Line
Loans shall be deemed to be paid with the proceeds of a Revolving Loan made by
Swing Line Lender, and such portion of the Swing Line Loans deemed to be so paid
shall no longer be outstanding as Swing Line Loans and shall no longer be due
under the Swing Line Note of Swing Line Lender but shall instead constitute part
of Swing Line Lender's outstanding Revolving Loans and shall be due under the
Revolving Note of Swing Line Lender. Company hereby authorizes Swing Line Lender
to charge Company's account with Swing Line Lender (up to the amount available
in each such account) in order to immediately pay Swing Line Lender the amount
of the Refunded Swing Line Loans to the extent the proceeds of such Revolving
Loans made by Lenders, including the Revolving Loan deemed to be made by Swing
Line Lender, are not sufficient to repay in full the Refunded Swing Line Loans.
If any portion of any such amount paid (or deemed to be paid) to Swing Line
Lender should be recovered by or on behalf of Company from Swing Line Lender in
bankruptcy, by assignment for the benefit of creditors or otherwise, the loss of
the amount so recovered shall be ratably shared among all Lenders in the manner
con- templated by subsection 10.5.
If, as a result of any bankruptcy or similar proceeding with
respect to Company, Revolving Loans are not made pursuant to this subsection
2.1B in an amount sufficient to repay any amounts owed to Swing Line Lender in
respect of any outstanding Swing Line Loans, each Lender shall be deemed to, and
hereby agrees to, have purchased a participation in such outstanding Swing Line
Loans in an amount equal to its Pro Rata Share (calculated without giving effect
to clauses (d) and (e) of the definition of Loan Exposure) of the unpaid amount
together with accrued interest thereon. Upon one Business Day's notice from
Swing Line Lender, each Lender shall deliver to Swing Line Lender an amount
equal to its respective participation in same day funds at the Funding and
Payment Office. In order to evidence such participation each Lender agrees to
enter into a participation agreement at the request of Swing Line Lender in form
and substance reasonably satisfactory to all parties. In the event any Lender
fails to make available to Swing Line Lender the amount of such Lender's
participation as provided in this paragraph, Swing Line Lender shall be entitled
to recover such amount on demand from such Lender together with interest thereon
at the rate customarily used by Swing Line Lender for the correction of errors
among banks for three Business Days and thereafter at the Base Rate. In the
event Swing Line Lender receives a payment of any amount in which other Lenders
have purchased participations as provided in this paragraph, Swing Line Lender
shall promptly distribute to each such other Lender its Pro Rata Share of such
payment.
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Anything contained herein to the contrary notwithstanding,
each Lender's obligation to make Revolving Loans for the purpose of repaying any
Refunded Swing Line Loan pursuant to the second preceding paragraph and each
Lender's obligation to purchase a participation in any unpaid Swing Line Loan
pursuant to the immediately preceding paragraph shall be absolute and
unconditional and shall not be affected by any circumstance, including without
limitation (a) any set-off, counterclaim, recoupment, defense or other right
which such Lender may have against Swing Line Lender, Company or any other
Person for any reason whatsoever; (b) the occurrence or continuation of an Event
of Default or a Potential Event of Default; (c) any adverse change in the
business, operations, properties, assets, condition (financial or otherwise) or
prospects of Company or any of its Subsidiaries; (d) any breach of this
Agreement or any other Loan Document by any party thereto; or (e) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing; provided if such unpaid Swing Line Loan increased Total
Utilization of Commitments (after giving effect to the repayment of any
Revolving Loan with the proceeds of such Swing Line Loan), such obligation of
each Lender is subject to the condition that one of the following must have
occurred: (X) Swing Line Lender did not have actual knowledge that any of the
conditions under Section 4 to the making of the applicable unpaid Swing Line
Loans were not satisfied at the time such unpaid Swing Line Loans were made, (Y)
such Lender had actual knowledge by receipt of any notices required to be
delivered to Lenders pursuant to subsection 6.1(ix) or otherwise, that any such
condition had not been satisfied and such Lender failed to notify Swing Line
Lender in writing that it had no obligation to make Revolving Loans until such
condition was satisfied (any such notice to be effective as of the date of
receipt thereof by Swing Line Lender), or (Z) the satisfaction of any such
condition not satisfied had been waived in accordance with subsection 10.6 prior
to or at the time such unpaid Swing Line Loans were made.
C. Borrowing Mechanics. Revolving Loans made on any Funding Date (other
than Revolving Loans made pursuant to a request by Swing Line Lender pursuant to
subsection 2.1B for the purpose of repaying any Refunded Swing Line Loans or
Revolving Loans made pursuant to subsection 3.3B for the purpose of reimbursing
Administrative Agent for the amount of a drawing under a Letter of Credit issued
by it) shall be in an aggregate minimum amount of $1,000,000 and integral
multiples of $100,000 in excess of that amount; provided that Revolving Loans
made on any Funding Date as Eurodollar Rate Loans with a particular Interest
Period shall be in an aggregate minimum amount of $1,000,000 and integral
multiples of $100,000 in excess of that amount. Swing Line Loans made on any
Funding Date shall be in an aggregate minimum amount of $500,000 and integral
multiples of $100,000 in excess of that amount. Whenever Company desires that
Lenders make Revolving Loans it shall deliver to Administrative Agent a Notice
of Borrowing no later than 8:30 A.M. (Pacific time) at least three Business Days
in advance of the proposed Funding Date (in the case of a Eurodollar Rate Loan)
or at least one Business Day in advance of the proposed Funding Date (in the
case of a Base Rate Loan). Whenever Company desires that Swing Line Lender make
a Swing Line Loan, it shall deliver to Administrative Agent a Notice of
Borrowing no later than 8:30 A.M. (Pacific time) on the proposed Funding Date.
Each
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Notice of Borrowing shall specify (i) the proposed Funding Date (which shall be
a Business Day), (ii) the amount and type of Loans requested, (iii) in the case
of Swing Line Loans and any Revolving Loans made on the Closing Date, that such
Loans shall be Base Rate Loans, (iv) in the case of any Revolving Loans not made
on the Closing Date, whether such Loans shall be Base Rate Loans or Eurodollar
Rate Loans, and (v) in the case of any Revolving Loans requested to be made as
Eurodollar Rate Loans, the initial Interest Period requested therefor. Revolving
Loans may be continued as or converted into Base Rate Loans and Eurodollar Rate
Loans in the manner provided in subsection 2.2D. In lieu of delivering the
above-described Notice of Borrowing, Company may give Administrative Agent
telephonic notice by the required time of any proposed borrowing under this
subsection 2.1C; provided that such notice shall be promptly confirmed in
writing by delivery of a Notice of Borrowing to Administrative Agent on or
before the applicable Funding Date.
Neither Administrative Agent nor any Lender shall incur any
liability to Company in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Company or
for otherwise acting in good faith under this subsection 2.1C, and upon funding
of Loans by Lenders in accordance with this Agreement pursuant to any such
telephonic notice Company shall have effected Loans hereunder.
Company shall notify Administrative Agent prior to the funding
of any Loans in the event that any of the matters to which Company is required
to certify in the applicable Notice of Borrowing is no longer true and correct
as of the applicable Funding Date, and the acceptance by Company of the proceeds
of any Loans shall constitute a re-certification by Company, as of the
applicable Funding Date, as to the matters to which Company is required to
certify in the applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and
2.6G, a Notice of Borrowing for a Eurodollar Rate Loan (or telephonic notice in
lieu thereof) shall be irrevocable on and after the related Interest Rate
Determination Date, and Company shall be bound to make a borrowing in accordance
therewith.
D. Disbursement of Funds. All Revolving Loans under this Agreement
shall be made by Lenders simultaneously and proportionately to their respective
Pro Rata Shares, it being understood that no Lender shall be responsible for any
default by any other Lender in that other Lender's obligation to make a Loan
requested hereunder nor shall the Commitment of any Lender be increased or
decreased as a result of a default by any other Lender in that other Lender's
obligation to make a Loan requested hereun- der. Promptly after receipt by
Administrative Agent of a Notice of Borrowing pursuant to subsection 2.1C (or
telephonic notice in lieu thereof), Administrative Agent shall notify each
Lender or Swing Line Lender, as the case may be, of the proposed borrowing. Each
Lender shall make the amount of its Loan available to Administrative Agent not
later than 1:00 P.M. (Pacific time) on the applicable Funding Date, and Swing
38
Line Lender shall make the amount of its Swing Line Loan available to
Administrative Agent not later than 1:00 P.M. (Pacific time) on the applicable
Funding Date, in each case in same day funds in Dollars, at the Funding and
Payment Office. Except as provided in subsection 2.1B or subsection 3.3B with
respect to Revolving Loans used to repay Refunded Swing Line Loans or to
reimburse Administrative Agent for the amount of a drawing under a Letter of
Credit issued by it, upon satisfaction or waiver of the conditions precedent
specified in subsections 4.1 (in the case of Loans made on the Closing Date) and
4.2 (in the case of all Loans), Administrative Agent shall make the proceeds of
such Loans available to Company on the applicable Funding Date by causing an
amount of same day funds in Dollars equal to the proceeds of all such Loans
received by Administrative Agent from Lenders or Swing Line Lender, as the case
may be, to be credited to the account of Company at the Funding and Payment
Office.
Unless Administrative Agent shall have been notified by any
Lender prior to the Funding Date for any Revolving Loans that such Lender does
not intend to make available to Administrative Agent the amount of such Lender's
Loan requested on such Funding Date, Administrative Agent may assume that such
Lender has made such amount available to Administrative Agent on such Funding
Date and Administrative Agent may, in its sole discretion, but shall not be
obligated to, make available to Company a corresponding amount on such Funding
Date. If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Funding Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent's demand therefor, Administrative
Agent shall promptly notify Company and Company shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the rate payable under this Agreement for Base Rate
Loans. Nothing in this subsection 2.1D shall be deemed to relieve any Lender
from its obligation to fulfill its Commitment hereunder or to prejudice any
rights that Company may have against any Lender as a result of any default by
such Lender hereunder.
E. Notes. Company shall execute and deliver on the Closing Date
(i) to each Lender (or to Administrative Agent for that Lender) a Revolving
Note substantially in the form of Exhibit VI annexed hereto to evidence that
Lender's Revolving Loans, in the principal amount of that Lender's Commitment
and with other appropriate insertions, and (ii) to Swing Line Lender a Swing
Line Note substantially in the form of Exhibit VII annexed hereto to evidence
Swing Line Lender's Swing Line Loans, in the principal amount of the Swing Line
Loan Commitment and with other appropriate insertions.
Administrative Agent may deem and treat the payee of any Note
as the owner thereof for all purposes hereof unless and until a Lender
Assignment Agreement
39
effecting the assignment or transfer thereof shall have been accepted by
Administrative Agent as provided in subsection 10.1B(ii). Any request, authority
or consent of any person or entity who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, assignee or transferee of that Note or of
any Note or Notes issued in exchange therefor.
F. Extension of Reduction Commencement Date. Company may, no earlier
than 365 days and not later than 90 days prior to the then effective Reduction
Commencement Date (as it may be extended from time to time pursuant hereto),
request in writing that the Reduction Commencement Date be extended for an
additional 365-day period (as so extended, the "Actual Reduction Commencement
Date"). After Company's request, each Lender may, in its discretion, agree to
such extension by giving written notice thereof to Administrative Agent as of a
date specified in Company's request which is at least 30 days after the
extension request is delivered. Each Lender's decision as to whether to extend
the Reduction Commitment Date shall be based, in part, on a new credit analysis
utilizing then current information in respect of Company's business, financial
condition and operations and other information furnished by Company.
In order for an extension of the Reduction Commencement Date
to be granted to Company, each Lender must consent to such an extension in
writing (an "Accepting Lender"). In the event that any Lender refuses to agree
to such an extension (a "Refusing Lender"), the Reduction Commencement Date may
still be extended if (i) one or more Accepting Lenders increase their
Commitments in an amount equal to the Commitments of all Refusing Lenders and
buy out the Pro Rata Share of each Refusing Lender or (ii) Company voluntarily
elects to terminate the Commitments of all Refusing Lenders and, on the then
effective Reduction Commencement Date, either (X) repays all principal, interest
and other amounts then owed to each Refusing Lender or (Y) solicits one or more
Eligible Assignees that agree(s) to assume the Commitments of all Refusing
Lenders and assume all obligations of such Refusing Lenders pursuant to a Lender
Assignment Agreement; provided that Requisite Lenders (determined without
reference to the Loan Exposure of the Refusing Lender) consent to such extension
on the terms set forth in clause (i) or (ii) above.
In addition, prior to each extension of the Reduction
Commencement Date, Company must (i) pay to Administrative Agent for the benefit
of Lenders an extension fee in an amount agreed to by Accepting Lenders and
Company, determined with reference to prevailing market conditions, and (ii)
deliver an Officers' Certificate reaffirming that each of Company's
representations and warranties contained in Section 5 are true and correct in
all material respects as of the Reduction Commencement Date in effect prior to
any such extension and attesting as to the absence of any Event of Default or,
to Company's Best Knowledge, a Potential Event of Default, as of such date.
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2.2 Interest on the Loans.
A. Rate of Interest. Subject to the provisions of subsections 2.2B,
2.2E, 2.6 and 2.7, each Revolving Loan shall bear interest on the unpaid
principal amount thereof from the date made through maturity (whether by
acceleration or otherwise) at a rate determined by reference to the Base Rate or
the Adjusted Eurodollar Rate, as the case may be. Subject to the provisions of
subsection 2.7, each Swing Line Loan shall bear interest on the unpaid principal
amount thereof from the date made through maturity (whether by acceleration or
otherwise) at a rate determined by reference to the Base Rate. The applicable
basis for determining the rate of interest with respect to any Loan shall be
selected by Company initially at the time a Notice of Borrowing is given with
respect to such Loan pursuant to subsection 2.1C. The basis for determining the
interest rate with respect to any Loan may be changed from time to time pursuant
to subsection 2.2D. If on any day a Loan is outstanding with respect to which
notice is required to be delivered to Administrative Agent in accordance with
the terms of this Agreement specifying the applicable basis for determining the
rate of interest but such notice has not been so delivered, then for that day
that Loan shall bear interest determined by reference to the Base Rate.
Subject to the provisions of subsections 2.2E and 2.7, the
Revolving Loans shall bear interest through maturity as follows:
(a) if a Base Rate Loan, then at the sum of the Base
Rate plus the Applicable Base Rate Margin; or
(b) if a Eurodollar Rate Loan, then at the sum of the
Adjusted Eurodollar Rate plus the Applicable Eurodollar Margin.
The Applicable Base Rate Margin and the Applicable Eurodollar
Margin shall automatically be adjusted, in accordance with the Leverage Ratio in
effect as determined by the Pricing Determination Certificate most recently
delivered pursuant to subsection 6.1 (xvi), on the first Business Day of the
month following the date on which such Pricing Determination Certificate is due;
provided that on the Closing Date, the Applicable Base Rate Margin and the
Applicable Eurodollar Margin shall be determined by reference to the Pricing
Determination Certificate delivered by Company to Administrative Agent pursuant
to subsection 4.1Q; provided further that if Company fails to deliver such
Pricing Determination Certificate to Administrative Agent within the required
period set forth in subsection 6.1(xvi), each of the Applicable Base Rate Margin
and the Applicable Eurodollar Margin shall revert to their respective maximum
amounts on the first Business Day following the date on which delivery of such
Pricing Determination Certificate was due and shall remain at such maximum
amounts until the first Business Day of the month following the date that such
past due Pricing Determination Certificate is actually received by
Administrative Agent, at which time each of the Applicable Base Rate Margin and
the Applicable Eurodollar Margin shall be readjusted in accordance with the
Leverage Ratio then in effect until the earlier of (i)
41
the first Business Day of the month following the due date of the immediately
succeeding Pricing Determination Certificate, if such certificate is delivered
on or before such due date or (ii) the first Business Day following such due
date, if such certificate is past due.
Subject to the provisions of subsections 2.2E and 2.7, the
Swing Line Loans shall bear interest through maturity at the sum of the Base
Rate plus the Applicable Base Rate Margin.
B. Interest Periods. In connection with each Eurodollar Rate
Loan, Company may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"Interest Period") to be applicable to such Loan, which Interest Period shall
be, at Company's option, either a one, two, three or six month period; provided
that:
(i) the initial Interest Period for any Eurodollar Rate Loan
shall commence on the Funding Date in respect of such Loan, in the case
of a Loan initially made as a Eurodollar Rate Loan, or on the date
specified in the applicable Notice of Conversion/Continuation, in the
case of a Loan converted to a Eurodollar Rate Loan;
(ii) in the case of immediately successive Interest
Periods applicable to a Eurodollar Rate Loan continued as such
pursuant to a Notice of Conversion/Continuation, each successive
Interest Period shall commence on the day on which the next preceding
Interest Period expires;
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (v) of this subsection 2.2B, end on
the last Business Day of a calendar month;
(v) no Interest Period with respect to any portion of
the Revolving Loans shall extend beyond the Commitment Termination
Date;
(vi) no Interest Period with respect to any portion of the
Revolving Loans shall extend beyond the date on which a permanent
reduction of the Commitments is scheduled to occur unless the sum of
(a) the aggregate principal amount of Revolving Loans that are Base
Rate Loans plus (b) the aggregate
42
principal amount of Revolving Loans that are Eurodollar Rate Loans with
Interest Periods expiring on or before such date plus (c) the excess of
the Commitments then in effect over the aggregate principal amount of
Revolving Loans then outstanding equals or exceeds the permanent
reduction of the Commitments that is scheduled to occur on such date;
(vii) there shall be no more than five Interest Periods
outstanding at any time; and
(viii) in the event Company fails to specify an Interest
Period for any Eurodollar Rate Loan in the applicable Notice of
Borrowing or Notice of Conversion/Continuation, Company shall be deemed
to have selected an Interest Period of one month.
C. Interest Payments. Subject to the provisions of subsection 2.2E,
interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity); provided that in the event any Loans that are Base Rate Loans are
prepaid pursuant to subsection 2.4A(ii) or 2.4B(i), interest accrued on such
Loans through the date of such prepayment shall be payable on the next
succeeding Interest Payment Date applicable to Base Rate Loans (or, if earlier,
at final maturity).
D. Conversion or Continuation. Subject to the provisions of subsection
2.6, Company shall have the option (i) to convert at any time all or any part of
its outstanding Revolving Loans equal to $1,000,000 and integral multiples of
$100,000 in excess of that amount from Loans bearing interest at a rate
determined by reference to one basis to Loans bearing interest at a rate
determined by reference to an alternative basis or (ii) upon the expiration of
any Interest Period applicable to a Eurodollar Rate Loan, to continue all or any
portion of such Loan equal to $1,000,000 and integral multiples of $100,000 in
excess of that amount as a Eurodollar Rate Loan; provided, however, that a
Eurodollar Rate Loan may only be converted into a Base Rate Loan on the
expiration date of an Interest Period applicable thereto.
Company shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 10:00 A.M. (Pacific time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan). A Notice of Conversion/Continuation
shall specify (i) the proposed conversion/continuation date (which shall be a
Business Day), (ii) the amount and type of the Loan to be converted/continued,
(iii) the nature of the proposed conversion/continuation, (iv) in the case of a
conversion to, or a continuation of, a Eurodollar Rate Loan, the requested
Interest Period, and (v) in the case of a conversion to, or a continuation of, a
Eurodollar Rate Loan, that no Event of Default or, to Company's Best Knowledge,
no
43
Potential Event of Default has occurred and is continuing. In lieu of delivering
the above-described Notice of Conversion/Continuation, Company may give
Administrative Agent telephonic notice by the required time of any proposed
conversion/continuation under this subsection 2.2D; provided that such notice
shall be promptly confirmed in writing by delivery of a Notice of
Conversion/Continuation to Administrative Agent on or before the proposed
conversion/continuation date.
Neither Administrative Agent nor any Lender shall incur any
liability to Company in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Company or for
otherwise acting in good faith under this subsection 2.2D, and upon conversion
or continuation of the applicable basis for determining the interest rate with
respect to any Loans in accordance with this Agreement pursuant to any such
telephonic notice Company shall have effected a conversion or continuation, as
the case may be, hereunder.
Except as otherwise provided in subsections 2.6B, 2.6C and
2.6G, a Notice of Conversion/Continuation for conversion to, or continuation of,
a Eurodollar Rate Loan (or telephonic notice in lieu thereof) shall be
irrevocable on and after the related Interest Rate Determination Date, and
Company shall be bound to effect a conversion or continuation in accordance
therewith.
E. Post-Default Interest. Upon the occurrence and during the
continuation of any Event of Default, the outstanding principal amount of all
Loans and, to the extent permitted by applicable law, the amount of any overdue
interest payments on the Loans or any overdue fees or other amounts owed
hereunder shall thereafter bear interest (including post-petition interest in
any proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable on demand at a rate which is 2% per annum in excess of the interest rate
otherwise payable under this Agreement with respect to the applicable Loans (or,
in the case of any such fees and other amounts, at a rate which is 2% per annum
in excess of the interest rate otherwise payable under this Agreement for Base
Rate Loans); provided that, in the case of Eurodollar Rate Loans, upon the
expiration of the Interest Period in effect at the time any such increase in
interest rate is effective, such Eurodollar Rate Loans shall thereupon become
Base Rate Loans and shall thereafter bear interest payable upon demand at a rate
which is 2% per annum in excess of the interest rate otherwise payable under
this Agreement for Base Rate Loans. Payment or acceptance of the increased rates
of interest provided for in this subsection 2.2E is not a permitted alternative
to timely payment and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of Administrative Agent or
any Lender.
F. Computation of Interest. Interest on the Loans shall be computed (i)
in the case of Base Rate Loans, on the basis of a 365-day or 366-day year, as
the case may be, and (ii) in the case of Eurodollar Rate Loans, on the basis of
a 360-day year, in each case for the actual number of days elapsed in the period
during which it accrues. In
44
computing interest on any Loan, the date of the making of such Loan or the first
day of an Interest Period applicable to such Loan or, with respect to a Base
Rate Loan being converted from a Eurodollar Rate Loan, the date of conversion of
such Eurodollar Rate Loan to such Base Rate Loan, as the case may be, shall be
included, and the date of payment of such Loan or the expiration date of an
Interest Period applicable to such Loan or, with respect to a Base Rate Loan
being converted to a Eurodollar Rate Loan, the date of conversion of such Base
Rate Loan to such Eurodollar Rate Loan, as the case may be, shall be excluded;
provided that if a Loan is repaid on the same day on which it is made, one day's
interest shall be paid on that Loan.
2.3 Fees.
A. Unused Commitment Fees. Company agrees to pay to Administrative
Agent, for distribution to each Lender in proportion to that Lender's
Pro Rata Share, commitment fees for the period from and including the Closing
Date to and excluding the Commitment Termination Date equal to (i) the average
of the daily excess of the Commitments over the sum of the aggregate principal
amount of Revolving Loans outstanding plus the Letter of Credit Usage multiplied
by (ii) the Applicable Commitment Fee Percentage, such commitment fees to be
calculated on the basis of a 365-day or 366-day year, as the case may be, and
the actual number of days elapsed and to be payable quarterly in arrears on
March 31, June 30, September 30 and December 31 of each year, commencing on the
first such date to occur after the Closing Date, and on the Commitment
Termination Date.
B. Additional Fees.
Company agrees to pay such other fees at such times as are set
forth in the Fee Letter.
2.4 Payments, Prepayments and Reductions in Commitments; General Provisions
Regarding Payments.
A. Scheduled and Mandatory Reductions of Commitments and Mandatory
Prepayments.
(i) Scheduled Commitment Reduction. The Commitments shall be
permanently reduced in eight equal semi-annual installments of
$15,000,000 each, effective on June 30 and December 31 of each year
commencing with the December 31 of the year in which the Actual
Reduction Commencement Date occurs; provided that all amounts owed by
Company hereunder shall in any event be paid in full no later than the
Commitment Termination Date; provided further that the scheduled
reductions of the Commitments set forth above shall be adjusted in
connection with any voluntary reductions of the Commitments in
accordance with subsection 2.4B(ii); provided still further that if the
Commitments
45
are reduced by Company's repayment of all amounts owed to a Refusing
Lender pursuant to subsection 2.1F(ii)(X) or as a result of a mandatory
reduction in the Commitments pursuant to subsection 2.4A(ii), then the
amount of such Refusing Lender's Commitment or mandatory Commitment
reduction shall be applied to reduce each of the scheduled reductions
set forth above on a pro rata basis.
(ii) Mandatory Prepayments and Mandatory Reductions of Revolving
Loan Commitments.
(a) Prepayments and Reductions from Asset Sales. If
Company or any of its Subsidiaries receives Cash Proceeds equal
to or in excess of $2,500,000 from any Asset Sale, (X) Company
shall prepay first the Swing Line Loans to the full extent
thereof and second the Revolving Loans, and (Y) the Revolving
Loan Commitments shall be permanently reduced, in the case of
either clause (X) or clause (Y) or, if such Cash Proceeds
exceed the amount of the outstanding Swing Line Loans and are
also applied to prepay Revolving Loans, in the case of both
clauses (X) and (Y), in an aggregate amount equal to the Net
Cash Proceeds from such Asset Sale; provided that Company's
obligation to make such a prepayment and the corresponding
reduction of the Revolving Loan Commitments shall occur with
respect to any portion of such Cash Proceeds on the earlier of
(i) the second Business Day following a determination by a
Responsible Officer that such portion of such Cash Proceeds
will not be invested in assets or property of a Related
Business or (ii) 270 days after the receipt of such Cash
Proceeds, if they have not been so invested in a Related
Business; provided further that in the case of Asset Sales
generating Net Cash Proceeds of less than $2,500,000, Company
may postpone making such prepayment until the second Business
Day following receipt of Cash Proceeds which, together with all
such proceeds received from Asset Sales since the Closing Date
or the most recent payment made pursuant to this subsection
2.4A(ii)(a), exceeds $6,000,000. Concurrently with any
prepayment of the Loans and/or reduction of the Revolving Loan
Commitments pursuant to this subsection 2.4A(ii)(a), Company
shall deliver to Agent an Officers' Certificate demonstrating
the derivation of the Net Cash Proceeds from the correlative
Asset Sale from the gross sales price thereof. In the event
that Company shall, at any time after receipt of Cash Proceeds
from any Asset Sale requiring a prepayment or a reduction of
the Revolving Loan Commitments pursuant to this subsection
2.4A(ii)(a), determine that the prepayments and/or reductions
of the Revolving Loan Commitments previously made in respect of
such Asset Sale were in an aggregate amount less than that
required by the terms of this subsection 2.4A(ii)(a), Company
shall promptly make an additional prepayment of the Swing Line
Loans or Revolving Loans, as the case may be (and the Revolving
Loan Commitments shall be permanently reduced), in the manner
described above in an amount equal to the amount of any such
46
deficit, and Company shall concurrently therewith deliver to
Agent an Officers' Certificate demonstrating the derivation of
the additional Net Cash Proceeds resulting in such deficit. Any
mandatory reduction of the Revolving Loan Commitments pursuant
to this subsection 2.4A(ii)(a) shall be applied to reduce each
of the scheduled reductions of the Revolving Loan Commitments
set forth in subsection 2.4A(i) on a pro rata basis.
(b) Prepayments Due to the Occurrence of an Event of
Loss. If Company or any of its Subsidiaries receives Cash
Proceeds equal to or in excess of $2,500,000 from any Event of
Loss, (X) Company shall prepay first the Swing Line Loans to
the full extent thereof and second the Revolving Loans, and (Y)
the Revolving Loan Commitments shall be permanently reduced, in
the case of either clause (X) or clause (Y) or, if such Cash
Proceeds exceed the amount of the outstanding Swing Line Loans
and are also applied to prepay Revolving Loans, in the case of
both clauses (X) and (Y), in an aggregate amount for the Swing
Line Loans and the Revolving Loans equal to the Net Cash
Proceeds from such Event of Loss; provided that Company's
obligation to make such a prepayment and the corresponding
reduction of the Revolving Loan Commitments shall occur with
respect to any portion of such Cash Proceeds on the earlier of
(i) the second Business Day following a determination by a
Responsible Officer that such portion of such Cash Proceeds
will not be invested in assets or property of a Related
Business or (ii) 270 days after the receipt of such Cash
Proceeds, if they have not been so invested in a Related
Business; provided further that in the case of any Event of
Loss generating Net Cash Proceeds of less than $2,500,000,
Company may postpone making such prepayment until the second
Business Day following receipt of Cash Proceeds which, together
with all such proceeds received from Events of Loss since the
Closing Date or the most recent payment made pursuant to this
subsection 2.4A(ii)(b), exceeds $6,000,000. Concurrently with
any prepayment of the Loans and/or reduction of the Revolving
Loan Commitments pursuant to this subsection 2.4A(ii)(b),
Company shall deliver to Agent an Officers' Certificate
demonstrating the derivation of the Net Cash Proceeds from the
correlative Event of Loss. In the event that Company shall, at
any time after receipt of Cash Proceeds from any Event of Loss
requiring a prepayment or a reduction of the Revolving Loan
Commitments pursuant to this subsection 2.4A(ii)(b), determine
that the prepayments and/or reductions of the Revolving Loan
Commitments previously made in respect of such Event of Loss
were in an aggregate amount less than that required by the
terms of this subsection 2.4A(ii)(b), Company shall promptly
make an additional prepayment of the Swing Line Loans or
Revolving Loans, as the case may be (and the Revolving Loan
Commitments shall be permanently reduced), in the manner
described above in an amount equal to the amount of any such
deficit, and Company shall concurrently therewith deliver to
Agent an Officers' Certificate
47
demonstrating the derivation of the additional Net Cash
Proceeds resulting in such deficit. Any mandatory reduction of
the Revolving Loan Commitments pursuant to this subsection
2.4A(ii)(b) shall be applied to reduce each of the scheduled
reductions of the Revolving Loan Commitments set forth in
subsection 2.4A(i) on a pro rata basis.
(c) Prepayments Due to Scheduled Reductions of
Revolving Loan Commitments. On each date on which the
Commitments are scheduled to be reduced pursuant to subsection
2.4A(i), Company shall pay the Loans to the extent necessary so
that aggregate outstanding Loans and Letters of Credit do not
exceed the amount of the Commitments after giving effect to the
reduction made on such date.
B. Voluntary Prepayments and Voluntary Reductions in Commitments.
(i) Voluntary Prepayments. Company may, upon written or
telephonic notice to Administrative Agent on or prior to 10:00 A.M.
(Pacific time) on the date of prepayment, which notice, if telephonic,
shall be promptly confirmed in writing, at any time and from time to
time prepay any Swing Line Loan on any Business Day in whole or in part
in an aggregate minimum amount of $500,000 and integral multiples of
$100,000 in excess of that amount. Company may, upon not less than one
Business Day's prior written or telephonic notice, in the case of Base
Rate Loans, and three Business Days' prior written or telephonic
notice, in the case of Eurodollar Rate Loans, in each case given to
Administrative Agent by 10:00 A.M. (Pacific time) on the date required
and, if given by telephone, promptly confirmed in writing to
Administrative Agent (which original written or telephonic notice
Administrative Agent will promptly transmit by telefacsimile or
telephone to each Lender), at any time and from time to time prepay any
Revolving Loans on any Business Day in whole or in part in an aggregate
minimum amount of $1,000,000 and integral multiples of $100,000 in
excess of that amount; provided, however, that a Eurodollar Rate Loan
may only be prepaid on the expiration of the Interest Period applicable
thereto. Any voluntary prepayments made pursuant to this subsection
2.4B(i) shall be applied to the type of Loan directed by Company in the
applicable notice of prepayment provided that in the event Company
fails to specify the Loans to which any such prepayment shall be
applied, such prepayment shall be applied first to repay outstanding
Swing Line Loans to the full extent thereof and second to repay
outstanding Revolving Loans to the full extent thereof.
(ii) Voluntary Reductions of Commitments. Company may, upon not
less than three Business Days' prior written or telephonic notice
confirmed in writing to Administrative Agent (which original written or
telephonic notice Administrative Agent will promptly transmit by
telefacsimile or telephone to each Lender), at any time and from time
to time terminate in whole or permanently reduce in part, without
premium or penalty, the Commitments in an amount up to
48
the amount by which the Commitments exceed the Total Utilization of
Commitments at the time of such proposed termination or reduction;
provided that any such partial reduction of the Commitments shall be in
an aggregate minimum amount of $1,000,000 and integral multiples of
$100,000 in excess of that amount. Company's notice to Administrative
Agent shall designate the date (which shall be a Business Day) of such
termination or reduction and the amount of any partial reduction, and
such termination or reduction of the Commitments shall be effective on
the date specified in Company's notice and shall reduce the Commitment
of each Lender proportionately to its Pro Rata Share. Any such
voluntary reduction of the Commitments shall be applied as directed by
Company to scheduled reductions of the Commitments set forth in
subsection 2.4A(i).
C. Application of Prepayments to Base Rate Loans and Eurodollar Rate
Loans. Considering Revolving Loans being prepaid separately, any prepayment
thereof shall be applied first to Base Rate Loans to the full extent thereof
before application to Eurodollar Rate Loans, in each case in a manner which
minimizes the amount of any payments required to be made by Company pursuant to
subsection 2.6D.
D. General Provisions Regarding Payments.
(i) Manner and Time of Payment. All payments by Company of
principal, interest, fees and other Obligations hereunder and under the
Notes, if any, shall be made in Dollars in same day funds, without
defense, setoff or counterclaim, free of any restriction or condition,
and delivered to Administrative Agent not later than 10:00 A.M.
(Pacific time) on the date due at the Funding and Payment Office for
the account of Lenders; funds received by Administrative Agent after
that time on such due date shall be deemed to have been paid by Company
on the next succeeding Business Day. Company hereby authorizes
Administrative Agent to charge its accounts with Administrative Agent
in order to cause timely payment to be made to Administrative Agent of
all principal, interest, fees, expenses and other amounts due hereunder
(subject to sufficient funds being available in its accounts for that
purpose).
(ii) Application of Payments to Principal and Interest. Except
as set forth in subsection 2.2C, all payments in respect of the
principal amount of any Loan shall include payment of accrued interest
on the principal amount being repaid or prepaid, and all such payments
shall be applied to the payment of interest before application to
principal.
(iii) Apportionment of Payments. Aggregate principal and
interest payments shall be apportioned among all outstanding Revolving
Loans to which such payments relate, in each case proportionately to
Lenders' respective Pro Rata Shares. Administrative Agent shall
promptly distribute to each Lender, at its primary address set forth
below its name on the appropriate signature page hereof or at such
other address as such Lender may request, its Pro Rata Share of all
49
such payments received by Administrative Agent and the commitment fees
of such Lender when received by Administrative Agent pursuant to
subsection 2.3A. Notwithstanding the foregoing provisions of this
subsection 2.4D(iii), if (i) pursuant to the provisions of subsection
2.6C, any Notice of Conversion/Continuation is withdrawn as to any
Affected Lender, (ii) any Affected Lender makes Base Rate Loans in
lieu of its Pro Rata Share of any Eurodollar Rate Loans, (iii) Company
repays all amounts owed to a Refusing Lender pursuant to subsection
2.1F(ii)(X), or (iv) Company prepays all amounts owed to a Former
Lender after the expiration of the applicable Withdrawal Period
pursuant to subsection 10.1B(iii), then Administrative Agent shall
give effect thereto in apportioning payments received thereafter.
(iv) Payments on Business Days. Whenever any payment to be made
hereunder shall be stated to be due on a day that is not a Business
Day, such payment shall be made on the next succeeding Business Day
except as set forth in subsection 2.2B(iii), and such extension of time
shall be included in the computation of the payment of interest
hereunder or of the commitment fees hereunder, as the case may be.
(v) Notation of Payment. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation
thereon of all Revolving Loans evidenced by that Revolving Note and all
principal payments previously made thereon and of the date to which
interest thereon has been paid; provided that the failure to make (or
any error in the making of) a notation of any Revolving Loan made under
such Revolving Note shall not limit or otherwise affect the obligations
of Company hereunder to the extent of Company's actual indebtedness or
under such Revolving Note with respect to any Revolving Loan or any
payments of principal or interest on such Revolving Note.
2.5 Use of Proceeds.
A. Use of Proceeds. The proceeds of the Loans (including the Swing
Line Loans) shall be applied by Company for general corporate purposes;
provided, however, that Company may not apply all or any portion of the proceeds
of the Loans to fund, directly or indirectly, a Hostile Acquisition.
B. Margin Regulations. No portion of the proceeds of any borrowing
under this Agreement shall be used by Company or any of its Subsidiaries in any
manner that might cause the borrowing or the application of such proceeds to
violate Regulation G, Regulation U, Regulation T or Regulation X of the Board of
Governors of the Federal Reserve System or any other regulation of such Board or
to violate the Exchange Act, in each case as in effect on the date or dates of
such borrowing and such use of proceeds.
50
2.6 Special Provisions Governing Eurodollar Rate Loans.
Notwithstanding any other provision of this Agreement to the
contrary, the following provisions shall govern with respect to Eurodollar Rate
Loans as to the matters covered:
A. Determination of Applicable Interest Rate. As soon as practicable
after 8:30 A.M. (Pacific time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent manifest
error, be final, conclusive and binding upon all parties) the interest rate that
shall apply to the Eurodollar Rate Loans for which an interest rate is then
being determined for the applicable Interest Period and shall promptly give
notice thereof (in writing or by telephone confirmed in writing) to Company and
each Lender.
B. Inability to Determine Applicable Interest Rate. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any Eurodollar Rate Loans, that by reason of
circumstances affecting the interbank Eurodollar market adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted Eurodollar Rate, Administrative
Agent shall on such date give notice (by telefacsimile or by telephone confirmed
in writing) to Company and each Lender of such determination, whereupon (i) no
Loans may be made as, or converted to, Eurodollar Rate Loans until such time as
Administrative Agent notifies Company and Lenders that the circumstances giving
rise to such notice no longer exist and (ii) any Notice of Borrowing or Notice
of Conversion/Continuation given by Company with respect to the Loans in respect
of which such determination was made shall be deemed to be rescinded by Company.
If, at any time following such a determination, Administrative Agent determines
that such circumstances that affected the interbank Eurodollar market no longer
exist, it shall promptly notify Company and each Lender thereof, at which time
the provisions of clauses (i) and (ii) above shall no longer be effective.
C. Illegality or Impracticability of Eurodollar Rate Loans. In the
event that on any date any Lender shall have determined (which determination
shall be final and conclusive and binding upon all parties hereto but shall be
made only after consultation with Company and Administrative Agent) that the
making, maintaining or continuation of its Eurodollar Rate Loans (i) has become
unlawful as a result of compliance by such Lender in good faith with any law,
treaty, governmental rule, regulation, guideline or order (or would conflict
with any such treaty, governmental rule, regulation, guideline or order not
having the force of law even though the failure to comply therewith would not be
unlawful) or (ii) has become impracticable, or would cause such Lender material
hardship, as a result of contingencies occurring after the date of this
Agreement which materially and adversely affect the interbank Eurodollar market
or the position of such Lender in that market, then, and in any such event, such
Lender shall be an "Affected
51
Lender" and it shall on that day give notice (by telefacsimile or by telephone
confirmed in writing) to Company and Administrative Agent of such determination
(which notice Administrative Agent shall promptly transmit to each other
Lender). Thereafter (a) the obligation of the Affected Lender to make Loans as,
or to convert Loans to, Eurodollar Rate Loans shall be suspended until such
notice shall be withdrawn by the Affected Lender, (b) to the extent such
determination by the Affected Lender relates to a Eurodollar Rate Loan then
being requested by Company pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, the Affected Lender shall make such Loan as (or convert
such Loan to, as the case may be) a Base Rate Loan, (c) the Affected Lender's
obligation to maintain its outstanding Eurodollar Rate Loans (the "Affected
Loans") shall be terminated at the earlier to occur of the expiration of the
Interest Period then in effect with respect to the Affected Loans or when
required by law, and (d) the Affected Loans shall automatically convert into
Base Rate Loans on the date of such termination. Notwithstanding the foregoing,
to the extent a determination by an Affected Lender as described above relates
to a Eurodollar Rate Loan then being
requested by Company pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, Company shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Conversion/Continuation as to all Lenders by giving notice (by telefacsimile or
by telephone confirmed in writing) to Administrative Agent of such rescission on
the date on which the Affected Lender gives notice of its determination as
described above (which notice of rescission Administrative Agent shall promptly
transmit to each other Lender). Except as provided in the immediately preceding
sentence, nothing in this subsection 2.6C shall affect the obligation of any
Lender other than an Affected Lender to make or maintain Loans as, or to convert
Loans to, Eurodollar Rate Loans in accordance with the terms of this Agreement.
D. Compensation For Breakage or Non-Commencement of Interest Periods.
Company shall compensate each Lender, upon written request by that Lender (which
request shall set forth the basis for requesting such amounts), for all
reasonable losses, expenses and liabilities (including, without limitation, any
interest paid by that Lender to lenders of funds borrowed by it to make or carry
its Eurodollar Rate Loans and any loss, expense or liability sustained by that
Lender in connection with the liquidation or re-employment of such funds) which
that Lender may sustain: (i) if for any reason (other than a default by that
Lender or the occurrence of an event described in subsection 2.6C) a borrowing
of any Eurodollar Rate Loan does not occur on a date specified therefor in a
Notice of Borrowing or a telephonic request for borrowing, or a conversion to or
continuation of any Eurodollar Rate Loan does not occur on a date specified
therefor in a Notice of Conversion/Continuation or a telephonic request for
conversion or continuation, (ii) if any prepayment or other principal payment or
any conversion of any of its Eurodollar Rate Loans occurs on a date prior to the
last day of an Interest Period applicable to that Loan, (iii) if any prepayment
of any of its Eurodollar Rate Loans is not made on any date specified in a
notice of prepayment given by Company, or (iv) as a consequence of any other
default by Company in the repayment of its Eurodollar Rate Loans when required
by the terms of this Agreement.
52
E. Booking of Eurodollar Rate Loans. Any Lender may make, carry or
transfer Eurodollar Rate Loans at, to, or for the account of any of its branch
offices or the office of an Affiliate of that Lender.
F. Assumptions Concerning Funding of Eurodollar Rate Loans. Calculation
of all amounts payable to a Lender under this subsection 2.6 and under
subsection 2.7A shall be made as though that Lender had actually funded each of
its relevant Eurodollar Rate Loans through the purchase of a Eurodollar deposit
bearing interest at the rate obtained pursuant to clause (i) of the definition
of Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of that
Lender to a domestic office of that Lender in the United States of America;
provided, however, that each Lender may fund each of its Eurodollar Rate Loans
in any manner it sees fit and the foregoing assumptions shall be utilized only
for the purposes of calculating amounts payable under this subsection 2.6 and
under subsection 2.7A.
G. Eurodollar Rate Loans After Default. After the occurrence of and
during the continuation of a Potential Event of Default of which it is aware to
its Best Knowledge or an Event of Default, (i) Company may not elect to have a
Loan be made or maintained as, or converted to, a Eurodollar Rate Loan after the
expiration of any Interest Period then in effect for that Loan and (ii) subject
to the provisions of subsection 2.6D, any Notice of Borrowing or Notice of
Conversion/Continuation given by Company with respect to a requested borrowing
or conversion/continuation that has not yet occurred shall be deemed to be
rescinded by Company.
2.7 Increased Costs; Taxes; Capital Adequacy.
A. Compensation for Increased Costs and Taxes. Subject to the
provisions of subsection 2.7B, in the event that any Lender shall reasonably
determine (which determination shall, absent manifest error, be final and
conclusive and binding upon all parties hereto) that any law, treaty or
governmental rule, regulation or order adopted after the date hereof, or any
change therein or in the interpretation, administration or application thereof
(including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the date hereof, or compliance by such
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-governmental authority
(whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office) to
any additional Tax (other than any Tax on the overall net income of
such Lender) with respect to this Agreement or any of its obligations
hereunder or any payments to such Lender (or its applicable lending
office) of principal, interest, fees or any other amount payable
hereunder;
53
(ii) imposes, modifies or holds applicable any reserve
(including without limitation any marginal, emergency, supplemental,
special or other reserve), special deposit, compulsory loan, FDIC
insurance or similar requirement against assets held by, or deposits or
other liabilities in or for the account of, or advances or loans by, or
other credit extended by, or any other acquisition of funds by, any
office of such Lender (other than any such reserve or other
requirements with respect to Eurodollar Rate Loans that are reflected
in the definition of Adjusted Eurodollar Rate); or
(iii) imposes any other condition (other than with respect to a
Tax matter) on or affecting such Lender (or its applicable lending
office) or its obligations hereunder or the interbank Eurodollar
market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Company shall promptly pay to such
Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Company (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this subsection
2.7A, which statement shall be conclusive and binding upon all parties hereto
absent manifest error.
B. Withholding of Taxes.
(i) Payments to Be Free and Clear. All sums payable by Company
under this Agreement and the other Loan Documents shall be paid free
and clear of and (except to the extent required by law) without any
deduction or withholding on account of any Tax (other than a Tax on the
overall net income of any Lender) imposed, levied, collected, withheld
or assessed by or within the United States of America or any political
subdivision in or of the United States of America or any other
jurisdiction from or to which a payment is made by or on behalf of
Company or by any federation or organization of which the United States
of America or any such jurisdiction is a member at the time of payment.
(ii) Grossing-up of Payments. If Company or any other Person is
required by law to make any deduction or withholding on account of any
such Tax from any sum paid or payable by Company to Administrative
Agent or any Lender under any of the Loan Documents:
54
(a) Company shall notify Administrative Agent of any
such requirement or any change in any such requirement as soon
as Company becomes aware of it;
(b) Company shall pay any such Tax before the date on
which penalties attach thereto, such payment to be made (if the
liability to pay is imposed on Company) for its own account or
(if that liability is imposed on Administrative Agent or such
Lender, as the case may be) on behalf of and in the name of
Administrative Agent or such Lender;
(c) the sum payable by Company in respect of which the
relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the
making of that deduction, withholding or payment,
Administrative Agent or such Lender, as the case may be,
receives on the due date a net sum equal to what it would have
received had no such deduction, withholding or payment been
required or made; and
(d) within 30 days after paying any sum from which it
is required by law to make any deduction or withholding, and
within 30 days after the due date of payment of any Tax which
it is required by clause (b) above to pay, Company shall
deliver to Administrative Agent evidence satisfactory to the
other affected parties of such deduction, withholding or
payment and of the remittance thereof to the relevant taxing or
other authority.
(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of
any juris- diction other than the United States or any state or
other political subdivision thereof (for purposes of this
subsection 2.7B(iii), a "Non-US Lender") shall deliver to
Administrative Agent for transmission to Company, on or prior
to the Closing Date (in the case of each Lender listed on the
signature pages hereof) or on the date of the Lender Assignment
Agreement pursuant to which it becomes a Lender (in the case of
each other Lender), and at such other times as may be necessary
in the determination of Company or Administrative Agent (each
in the reasonable exercise of its discretion), (1) two original
copies of Internal Revenue Service Form 1001 or 4224 (or any
successor forms), properly completed and duly executed by such
Lender, together with any other certificate or statement of
exemption required under the Internal Revenue Code or the
regulations issued thereunder to establish that such Lender is
not subject to deduction or withholding of United States
federal income tax with respect to any payments to such Lender
of principal, interest, fees or other amounts payable under any
of the Loan Documents or (2) if such Lender is not a "bank" or
other Person described in Section 881(c)(3) of the Internal
55
Revenue Code and cannot deliver either Internal Revenue Service
Form 1001 or 4224 pursuant to clause (1) above, a Certificate
re Non-Bank Status together with two original copies of
Internal Revenue Service Form W-8 (or any successor form),
properly completed and duly executed by such Lender, together
with any other certificate or statement of exemption required
under the Internal Revenue Code or the regulations issued
thereunder to establish that such Lender is not subject to
deduction or withholding of United States federal income tax
with respect to any payments to such Lender of interest payable
under any of the Loan Documents.
(b) Each Lender required to deliver any forms,
certificates or other evidence with respect to United States
federal income tax withholding matters pursuant to subsection
2.7B(iii)(a) hereby agrees, from time to time after the initial
delivery by such Lender of such forms, certificates or other
evidence, whenever a lapse in time or change in circumstances
renders such forms, certificates or other evidence obsolete or
inaccurate in any material respect, such Lender shall (1)
deliver to Administrative Agent for transmission to Company two
new original copies of Internal Revenue Service Form 1001 or
4224, or a Certificate re Non-Bank Status and two original
copies of Internal Revenue Service Form W-8, as the case may
be, properly completed and duly executed by such Lender,
together with any other certificate or statement of exemption
required in order to confirm or establish that such Lender is
not subject to deduction or withholding of United States
federal income tax with respect to payments to such Lender
under the Loan Documents or (2) immediately notify
Administrative Agent and Company of its inability to deliver
any such forms, certificates or other evidence; provided that
Company may continue to rely on any form, certificate or other
evidence delivered to it pursuant to subsection 2.7B(iii)(a)
until such time as it has received information pursuant to this
subsection 2.7B(iii)(b) that is intended to replace or supplant
the information provided on any such previously delivered form
or certificate.
(c) Company shall not be required to pay any
additional amount to any Non-US Lender under clause (c) of
subsection 2.7B(ii) if such Lender shall have failed to satisfy
the requirements of subsection 2.7B(iii)(a); provided that if
such Lender shall have satisfied such requirements on the
Closing Date (in the case of each Lender listed on the
signature pages hereof) or on the date of the Lender Assignment
Agreement pursuant to which it became a Lender (in the case of
each other Lender), nothing in this subsection 2.7B(iii)(c)
shall relieve Company of its obligation to pay any additional
amounts pursuant to clause (c) of subsection 2.7B(ii) in the
event that, as a result of any change in any applicable law,
treaty or governmental rule, regulation or order, or any change
in the interpretation, administration or application thereof,
such
56
Lender is no longer properly entitled to deliver forms,
certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to
withholding as described in subsection 2.7B(iii)(a).
C. Capital Adequacy Adjustment. If any Lender shall reasonably have
determined that the adoption, effectiveness, phase-in or applicability after the
date hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such governmental authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender's Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or Letters of
Credit to a level below that which such Lender or such controlling corporation
could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Company from
such Lender of the statement referred to in the next sentence, Company shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or such controlling corporation on an after-tax basis for such reduction. Such
Lender shall deliver to Company (with a copy to Administrative Agent) a written
statement, setting forth in reasonable detail the basis of the calculation of
such additional amounts, which statement shall be conclusive and binding upon
all parties hereto absent manifest error.
2.8 Obligation of Lenders and Administrative Agent to Mitigate.
Each Lender and Administrative Agent agree that, as promptly as
practicable after the officer of such Lender or Administrative Agent responsible
for administering the Loans or Letters of Credit of such Lender or
Administrative Agent becomes aware of the occurrence of an event or the
existence of a condition that would cause such Lender to become an Affected
Lender or that would entitle such Lender to receive payments under subsection
2.7 or subsection 3.6, it will, to the extent not inconsistent with the internal
policies of such Lender or Administrative Agent and any applicable legal or
regulatory restrictions, use reasonable efforts (i) to make, issue, fund or
maintain the Commitment of such Lender or Administrative Agent or the affected
Loans of such Lender or Administrative Agent through another lending or letter
of credit office of such Lender or Administrative Agent, or (ii) take such other
measures as such Lender or Administrative Agent may deem reasonable, if as a
result thereof the circumstances which would cause such Lender or Administrative
Agent to be an Affected Lender would cease to exist or the additional amounts
which would otherwise be required to be paid to such Lender or Administrative
Agent pursuant to subsection 2.7
57
or subsection 3.6 would be materially reduced and if, as determined by such
Lender or Administrative Agent in its sole discretion, the making, issuing,
funding or maintaining of such Commitment or Loans or Letters of Credit through
such other lending or letter of credit office or in accordance with such other
measures, as the case may be, would not otherwise materially adversely affect
such Commitment or Loans or Letters of Credit or the interests of such Lender or
Administrative Agent; provided that such Lender or Administrative Agent will not
be obligated to utilize such other lending or letter of credit office pursuant
to this subsection 2.8 unless Company agrees to pay all reasonable incremental
expenses incurred by such Lender or Administrative Agent as a result of
utilizing such other lending or letter of credit office as described in clause
(i) above. A certificate as to the amount of any such expenses payable by
Company pursuant to this subsection 2.8 (setting forth in reasonable detail the
basis for requesting such amount) submitted by such Lender or Administrative
Agent to Company (with a copy to Administrative Agent) shall be conclusive
absent manifest error.
2.9 Replacement of Lenders.
In the event Company is required under the provisions of
subsection 2.7 or subsection 3.6 to make payments to any Lender, Company may,
within 120 days after the date any notice or demand requiring such payment under
subsection 2.7 or subsection 3.6 is given and so long as no Event of Default
shall have occurred and be continuing, elect to terminate such Lender as a party
to this Agreement; provided that, concurrently with such termination, (i)
Company shall pay that Lender, without duplication, all principal, interest and
fees and other amounts owed to such Lender through such date of termination,
(ii) another Lender or Eligible Assignee shall agree, as of such date, to become
a Lender for all purposes under this Agreement (whether by assignment or
amendment, if necessary) and to assume all obligations under this Agreement of
the Lender to be terminated as of such date and (iii) all documents and
supporting materials necessary, in the judgment of Administrative Agent to
evidence the substitution of such Lender shall have been received and approved
by Administrative Agent as of such date.
Section 3. LETTERS OF CREDIT
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein.
A. Letters of Credit. In addition to Company requesting that Lenders
make Revolving Loans pursuant to subsection 2.1A and that Swing Line Lender make
Swing Line Loans pursuant to subsection 2.1B, Company may request, in accordance
with the provisions of this subsection 3.1, from time to time during the period
from the Closing Date to but excluding the tenth Business Day prior to the
Commitment Termination Date, that Administrative Agent issue Letters of Credit
for the account of Company for the purposes specified in the definition of
Standby Letters of Credit. Subject to the terms and conditions of this Agreement
and in reliance upon the representations and warranties of Company herein set
forth, Administrative Agent shall issue such Letters of
58
Credit in accordance with the provisions of this subsection 3.1; provided that
Company shall not request that Administrative Agent issue (and Administrative
Agent shall not issue):
(i) any Letter of Credit if, after giving effect to such
issuance, the Total Utilization of Commitments would exceed the
Commitments then in effect;
(ii) any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage would exceed $10,000,000;
(iii) any Letter of Credit having an expiration date later than
the earlier of (a) the fifth Business Day prior to the Commitment
Termination Date and (b) the date which is one year from the date of
issuance of such Letter of Credit; provided that the immediately
preceding clause (b) shall not prevent Administrative Agent from
agreeing that a Letter of Credit will automatically be extended for one
or more successive periods not to exceed one year each unless
Administrative Agent elects not to extend for any such additional
period; or
(iv) any Letter of Credit denominated in a currency other than
Dollars.
B. Mechanics of Issuance.
(i) Notice of Issuance. Whenever Company desires the issuance
of a Letter of Credit, it shall deliver to Administrative Agent a
Notice of Issuance of Letter of Credit substantially in the form of
Exhibit IV annexed hereto no later than 10:00 A.M. (Pacific time) at
least 5 Business Days, or in each case such shorter period as may be
agreed to by Administrative Agent in any particular instance, in
advance of the proposed date of issuance. The Notice of Issuance of
Letter of Credit shall specify (a) the proposed date of issuance (which
shall be a Business Day), (b) the face amount of the Letter of Credit,
(c) the expiration date of the Letter of Credit, (d) the name and
address of the beneficiary, and (e) the verbatim text of the proposed
Letter of Credit or the proposed terms and conditions thereof,
including a precise description of any documents and the verbatim text
of any certificates to be presented by the beneficiary which, if
presented by the beneficiary prior to the expiration date of the Letter
of Credit, would require Administrative Agent to make payment under the
Letter of Credit; provided that Administrative Agent, in its reasonable
discretion, may require changes in the text of the proposed Letter of
Credit or any such documents or certificates; and provided, further
that no Letter of Credit shall require payment against a conforming
draft to be made thereunder on the same business day (under the laws of
the jurisdiction in which the office of Administrative Agent to which
such draft is required to be presented is located) that such draft is
presented if such presentation is
59
made after 10:00 A.M. (in the time zone of such office of
Administrative Agent) on such business day.
Company shall notify Administrative Agent prior to the
issuance of any Letter of Credit in the event that any of the matters
to which Company is required to certify in the applicable Notice of
Issuance of Letter of Credit is no longer true and correct as of the
proposed date of issuance of such Letter of Credit, and upon the
issuance of any Letter of Credit Company shall be deemed to have
re-certified, as of the date of such issuance, as to the matters to
which Company is required to certify in the applicable Notice of
Issuance of Letter of Credit.
(ii) Issuance of Letter of Credit. Upon satisfaction or waiver
(in accordance with subsection 10.6) of the conditions set forth in
subsection 4.3, Administrative Agent shall issue the requested Letter
of Credit in accordance with Administrative Agent's standard operating
procedures.
(iii) Notification to Lenders. Upon the issuance of any Letter
of Credit Administrative Agent shall notify each other Lender of such
issuance, which notice shall be accompanied by a copy of such Letter of
Credit. Promptly after receipt of such notice, Administrative Agent
shall notify each Lender of the amount of such Lender's respective
participation in such Letter of Credit, determined in accordance with
subsection 3.1C.
(iv) Reports to Lenders. Within 15 days after the end of each
calendar quarter of Company ending after the Closing Date, so long as
any Letter of Credit shall have been outstanding during such calendar
quarter, Administrative Agent shall deliver to each Lender a report
setting forth the average for such calendar quarter of the daily
maximum amount available to be drawn under the Letters of Credit issued
by Administrative Agent that were outstanding during such calendar
quarter.
C. Lenders' Purchase of Participations in Letters of Credit.
Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby agrees to, have irrevocably purchased from Administrative
Agent a participation in such Letter of Credit and drawings thereunder in an
amount equal to such Lender's Pro Rata Share of the maximum amount which is or
at any time may become available to be drawn thereunder.
3.2 Letter of Credit Fees.
Company agrees to pay the following amounts to Administrative
Agent with respect to Letters of Credit issued by it:
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(i) on the date of issuance and of each extension thereof of
each Letter of Credit, (a) a non-refundable letter of credit fee equal
to the Applicable Eurodollar Margin at such time multiplied by the
maximum amount available to be drawn under such Letter of Credit and
(b) a non-refundable fronting letter of credit fee equal to 0.25% per
annum of the maximum amount available to be drawn under such Letter of
Credit, in each case computed on the basis of a 360- day year for the
actual number of days in the term of such Letter of Credit, including
any extension thereof;
(ii) with respect to the amendment or transfer of each Letter
of Credit and each drawing made thereunder (without duplication of the
fees payable under clause (i) above), documentary and processing
charges in accordance with Administrative Agent's standard schedule for
such charges in effect at the time of such issuance, amendment,
transfer or drawing, as the case may be and, to the extent such
amendment increases the maximum amount available to be drawn under any
such Letter of Credit, increased fees in accordance with the formula
set forth in subsection 3.2(i)(a) above.
Promptly upon receipt by Administrative Agent of any amount described in clause
(i)(a) of this subsection 3.2, Administrative Agent shall distribute to each
other Lender its Pro Rata Share of such amount.
3.3 Drawings and Reimbursement of Amounts Drawn Under Letters of Credit.
A. Responsibility of Administrative Agent With Respect to Drawings. In
determining whether to honor any drawing under any Letter of Credit by the
beneficiary thereof, Administrative Agent shall be responsible only to determine
that the documents and certificates required to be delivered under such Letter
of Credit have been delivered and that they comply on their face with the
requirements of such Letter of Credit.
B. Reimbursement by Company of Amounts Drawn Under Letters of Credit.
In the event Administrative Agent has determined to honor a drawing under a
Letter of Credit issued by it, Administrative Agent shall immediately notify
Company, and Company shall reimburse Administrative Agent on or before the
Business Day immediately following the date on which such drawing is honored
(the "Reimbursement Date") in an amount in Dollars and in same day funds equal
to the amount of such drawing; provided that, anything contained in this
Agreement to the contrary notwithstanding, (i) unless Company shall have
notified Administrative Agent prior to 8:30 A.M. (Pacific time) on the date of
such drawing that Company intends to reimburse Administrative Agent for the
amount of such drawing with funds other than the proceeds of Revolving Loans,
Company shall be deemed to have given a timely Notice of Borrowing to
Administrative Agent requesting Lenders to make Revolving Loans that are Base
Rate Loans on the Reimbursement Date in an amount in Dollars equal to the amount
of such drawing and (ii) subject to satisfaction or waiver of the conditions
specified in subsection 4.2B, Lenders shall, on the Reimbursement Date, make
Revolving
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Loans that are Base Rate Loans in the amount of such drawing, the proceeds of
which shall be applied directly by Administrative Agent to reimburse
Administrative Agent for the amount of such drawing; and provided, further that
if for any reason proceeds of Revolving Loans are not received by Administrative
Agent on the Reimbursement Date in an amount equal to the amount of such
drawing, Company shall reimburse Administrative Agent, on demand, in an amount
in same day funds equal to the excess of the amount of such drawing over the
aggregate amount of such Revolving Loans, if any, which are so received. Nothing
in this subsection 3.3B shall be deemed to relieve any Lender from its
obligation to make Revolving Loans on the terms and conditions set forth in this
Agreement, and Company shall retain any and all rights it may have against any
Lender resulting from the failure of such Lender to make such Revolving Loans
under this subsection 3.3B.
C. Payment by Lenders of Unreimbursed Drawings Under Letters of Credit.
(i) Payment by Lenders. In the event that Company shall fail
for any reason to reimburse Administrative Agent as provided in
subsection 3.3B in an amount equal to the amount of any drawing honored
by Administrative Agent under a Letter of Credit issued by it,
Administrative Agent shall promptly notify each other Lender of the
unreimbursed amount of such drawing and of such other Lender's
respective participation therein based on such Lender's Pro Rata Share.
Each Lender shall make available to Administrative Agent an amount
equal to its respective participation, in Dollars and in same day
funds, at the office of Administrative Agent specified in such notice,
not later than 1:30 P.M. (Pacific time) on the first business day
(under the laws of the jurisdiction in which such office of
Administrative Agent is located) after the date notified by
Administrative Agent. In the event that any Lender fails to make
available to Administrative Agent on such business day the amount of
such Lender's participation in such Letter of Credit as provided in
this subsection 3.3C, Administrative Agent shall be entitled to recover
such amount on demand from such Lender together with interest thereon
at the rate customarily used by Administrative Agent for the correction
of errors among banks for three Business Days and thereafter at the
Base Rate. Nothing in this subsection 3.3C shall be deemed to prejudice
the right of any Lender to recover from Administrative Agent any
amounts made available by such Lender to Administrative Agent pursuant
to this subsection 3.3C in the event that it is determined by the final
judgment of a court of competent jurisdiction that the payment with
respect to a Letter of Credit by Administrative Agent in respect of
which payment was made by such Lender constituted gross negligence or
willful misconduct on the part of Administrative Agent.
(ii) Distribution to Lenders of Reimbursements Received From
Company. In the event Administrative Agent shall have been reimbursed
by other Lenders pursuant to subsection 3.3C(i) for all or any portion
of any drawing honored by Administrative Agent under a Letter of Credit
issued by it, Administrative Agent shall distribute to each other
Lender which has paid all
62
amounts payable by it under subsection 3.3C(i) with respect to such
drawing such other Lender's Pro Rata Share of all payments subsequently
received by Administrative Agent from Company in reimbursement of such
drawing when such payments are received. Any such distribution shall be
made to a Lender at its primary address set forth below its name on the
appropriate signature page hereof or at such other address as such
Lender may request.
D. Interest on Amounts Drawn Under Letters of Credit.
(i) Payment of Interest by Company. Company agrees to pay to
Administrative Agent, with respect to drawings made under any Letters
of Credit issued by it, interest on the amount paid by Administrative
Agent in respect of each such drawing from the date of such drawing to
but excluding the date such amount is reimbursed by Company (including
any such reimbursement out of the proceeds of Revolving Loans pursuant
to subsection 3.3B) at a rate equal to (a) for the period from the date
of such drawing to but excluding the Reimbursement Date, the rate then
in effect under this Agreement with respect to Revolving Loans that are
Base Rate Loans and (b) thereafter, a rate which is 2% per annum in
excess of the rate of interest otherwise payable under this Agreement
with respect to Revolving Loans that are Base Rate Loans. Interest
payable pursuant to this subsection 3.3D(i) shall be computed on the
basis of a 365-day or 366-day year, as the case may be, for the actual
number of days elapsed in the period during which it accrues and shall
be payable on demand or, if no demand is made, on the date on which the
related drawing under a Letter of Credit is reimbursed in full.
(ii) Distribution of Interest Payments by Administrative Agent.
Promptly upon receipt by Administrative Agent of any payment of
interest pursuant to subsection 3.3D(i) with respect to a drawing under
a Letter of Credit issued by it, (a) Administrative Agent shall
distribute to each other Lender, out of the interest received by
Administrative Agent in respect of the period from the date of such
drawing to but excluding the date on which Administrative Agent is
reimbursed for the amount of such drawing (including any such
reimbursement out of the proceeds of Revolving Loans pursuant to
subsection 3.3B), the amount that such other Lender would have been
entitled to receive in respect of the letter of credit fee that would
have been payable in respect of such Letter of Credit for such period
pursuant to subsection 3.2 if no drawing had been made under such
Letter of Credit, and (b) in the event Administrative Agent shall have
been reimbursed by other Lenders pursuant to subsection 3.3C(i) for all
or any portion of such drawing, Administrative Agent shall distribute
to each other Lender which has paid all amounts payable by it under
subsection 3.3C(i) with respect to such drawing such other Lender's Pro
Rata Share of any interest received by Administrative Agent in respect
of that portion of such drawing so reimbursed by other Lenders for the
period from the date on which such Administrative Agent was so
reimbursed by other Lenders to and including the date on which such
63
portion of such drawing is reimbursed by Company. Any such distribution
shall be made to a Lender at its primary address set forth below its
name on the appropriate signature page hereof or at such other address
as such Lender may request.
3.4 Obligations Absolute.
The obligation of Company to reimburse Administrative Agent for
drawings made under the Letters of Credit issued by it and to repay any
Revolving Loans made by Lenders pursuant to subsection 3.3B and the obligations
of Lenders under subsection 3.3C(i) shall be unconditional and irrevocable and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances including, without limitation, the following circumstances:
(i) any lack of validity or enforceability of any Letter of
Credit;
(ii) the existence of any claim, set-off, defense or other
right which Company or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any Persons
for whom any such transferee may be acting), Administrative Agent or
other Lender or any other Person or, in the case of a Lender, against
Company, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any
underlying transaction between Company or one of its Subsidiaries and
the beneficiary for which any Letter of Credit was procured);
(iii) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(iv) payment by Administrative Agent under any Letter of Credit
against presentation of a demand, draft or certificate or other
document which does not comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations, properties,
assets, condition (financial or otherwise) or prospects of Company or
any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document
by any party thereto;
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing; or
64
(viii) the fact that an Event of Default or a Potential Event
of Default shall have occurred and be continuing;
provided, in each case, that payment by Administrative Agent under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of Administrative Agent under the circumstances in question
(as determined by a final judgment of a court of competent jurisdiction).
3.5 Indemnification; Nature of Administrative Agent's Duties.
A. Indemnification. In addition to amounts payable as provided in
subsection 3.6, Company hereby agrees to protect, indemnify, pay and save
harmless Administrative Agent from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and Allocated Costs of Internal
Counsel) which Administrative Agent may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit by
Administrative Agent, other than as a result of (a) the gross negligence or
willful misconduct of Administrative Agent as determined by a final judgment of
a court of competent jurisdiction or (b) subject to the following clause (ii),
the wrongful dishonor by Administrative Agent of a proper demand for payment
made under any Letter of Credit issued by it or (ii) the failure of
Administrative Agent to honor a drawing under any such Letter of Credit as a
result of any act or omission, whether rightful or wrongful, of any present or
future de jure or de facto government or governmental authority (all such acts
or omissions herein called "Governmental Acts").
B. Nature of Administrative Agent's Duties. As between Company and
Administrative Agent, Company assumes all risks of the acts and omissions of, or
misuse of the Letters of Credit issued by Administrative Agent by, the
respective beneficiaries of such Letters of Credit. In furtherance and not in
limitation of the foregoing, Administrative Agent shall not be responsible for:
(i) the form, validity, sufficiency, accuracy, genuineness or legal effect of
any document submitted by any party in connection with the application for and
issuance of any such Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or forged;
(ii) the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) failure of the beneficiary of
any such Letter of Credit to comply fully with any conditions required in order
to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of any drawing under
such Letter of Credit; or (viii) any consequences arising from causes beyond the
control of Administrative Agent,
65
including without limitation any Governmental Acts, and none of the above shall
affect or impair, or prevent the vesting of, any of Administrative Agent's
rights or powers hereunder.
In furtherance and extension and not in limitation of the
specific provisions set forth in the first paragraph of this subsection 3.5B,
any action taken or omitted by Administrative Agent under or in connection with
the Letters of Credit issued by it or any documents and certificates delivered
thereunder, if taken or omitted in good faith, shall not put Administrative
Agent under any resulting liability to Company.
Notwithstanding anything to the contrary contained in this
subsection 3.5, Company shall retain any and all rights it may have against
Administrative Agent for any liability arising solely out of the gross
negligence or willful misconduct of such Administrative Agent, as determined by
a final judgment of a court of competent jurisdiction.
3.6 Increased Costs and Taxes Relating to Letters of Credit.
In the event that Administrative Agent or any Lender shall
determine (which determination shall, absent manifest error, be final and
conclusive and binding upon all parties hereto) that any law, treaty or
governmental rule, regulation or order, or any change therein or in the
interpretation, administration or application thereof (including the
introduction of any new law, treaty or governmental rule, regulation or order),
or any determination of a court or governmental authority, in each case that
becomes effective after the date hereof, or compliance by Administrative Agent
or Lenders with any guideline, request or directive issued or made after the
date hereof by any central bank or other governmental or quasi-governmental
authority (whether or not having the force of law):
(i) subjects Administrative Agent or such Lender (or its
applicable lending or letter of credit office) to any additional Tax
(other than any Tax on the overall net income of Administrative Agent
or such Lender) with respect to the issuing or maintaining of any
Letters of Credit or the purchasing or maintaining of any
participations therein or any other obligations under this Section 3,
whether directly or by such being imposed on or suffered by
Administrative Agent;
(ii) imposes, modifies or holds applicable any reserve
(including without limitation any marginal, emergency, supplemental,
special or other reserve), special deposit, compulsory loan, FDIC
insurance or similar requirement in respect of any Letters of Credit
issued by Administrative Agent or participations therein purchased by
any Lender; or
(iii) imposes any other condition (other than with respect to a
Tax matter) on or affecting Administrative Agent or such Lender (or its
applicable
66
lending or letter of credit office) regarding this Section 3 or any
Letter of Credit or any participation therein;
and the result of any of the foregoing is to increase the cost to Administrative
Agent or such Lender of agreeing to issue, issuing or maintaining any Letter of
Credit or agreeing to purchase, purchasing or maintaining any participation
therein or to reduce any amount received or receivable by Administrative Agent
or such Lender (or its applicable lending or letter of credit office) with
respect thereto; then, in any case, Company shall promptly pay to Administrative
Agent or such Lender, upon receipt of the statement referred to in the next
sentence, such additional amount or amounts as may be necessary to compensate
Administrative Agent or such Lender for any such increased cost or reduction in
amounts received or receivable hereunder. Administrative Agent or such Lender
shall deliver to Company a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to Administrative Agent or
such Lender under this subsection 3.6, which statement shall be conclusive and
binding upon all parties hereto absent manifest error.
Section 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Revolving Loans and Swing
Line Loans and the issuance of Letters of Credit hereunder are subject to the
satisfaction of the following conditions.
4.1 Conditions to Initial Revolving Loans and Swing Line Loans.
The obligations of Lenders to make any Revolving Loans or Swing
Line Loans to be made on the Closing Date are, in addition to the conditions
precedent specified in subsection 4.2, subject to prior or concurrent
satisfaction of the following conditions:
A. Loan Documents. On or before the Closing Date, all Loan Documents
shall have been prepared by counsel to Administrative Agent and shall be in form
and substance satisfactory to Administrative Agent and Lenders.
B. Company Documents. On or before the Closing Date, Company shall
deliver or cause to be delivered to Lenders (or to Administrative Agent for
Lenders with sufficient originally executed copies, where appropriate, for each
Lender and its counsel) the following, each, unless otherwise noted, dated the
Closing Date:
(i) Certified copies of its charter documents, together with a
good standing certificate from the Secretary of State of the State of
Nevada and each state in which it is qualified as a foreign corporation
to do business and, to the extent generally available, a certificate or
other evidence of good standing as to payment of any applicable
franchise or similar taxes from the appropriate taxing
67
authority of each of such states, each dated a recent date prior to
the Closing Date;
(ii) Copies of its Bylaws, certified as of the Closing Date by
its secretary or an assistant secretary;
(iii) Resolutions of its Board of Directors approving and
authorizing the execution, delivery and performance of this Agreement
and the other Loan Documents to which it is a party, certified as of
the Closing Date by its secretary or an assistant secretary as being in
full force and effect without modification or amendment;
(iv) Signature and incumbency certificates of its officers
executing this Agreement and the other Loan Documents to which it is
a party;
(v) Executed originals of this Agreement, any Notes drawn to
the order of each Lender and Swing Line Lender and with appropriate
insertions and the other Loan Documents to which it is a party; and
(vi) Such other documents as Administrative Agent may
reasonably request.
C. Loan Party Documents. On or before the Closing Date, each Loan
Party shall deliver or cause to be delivered to Lenders (or to Administrative
Agent for Lenders with sufficient originally executed copies, where appropriate,
for each Lender and its counsel) the following, each, unless otherwise noted,
dated the Closing Date:
(i) Certified copies of its Certificate or Articles of
Incorporation or other charter documents, together with a good standing
certificate from the Secretary of State of the state of its
incorporation and each other state in which it is qualified as a
foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to
payment of any applicable franchise or similar taxes from the
appropriate taxing authority of each of such states, each dated a
recent date prior to the Closing Date;
(ii) Copies of its Bylaws, if any, certified as of the Closing
Date by its corporate secretary or an assistant secretary;
(iii) Resolutions of its Board of Directors approving and
authorizing the execution, delivery and performance of the Loan
Documents to which it is a party, certified as of the Closing Date by
its corporate secretary or an assistant secretary as being in full
force and effect without modification or amendment;
(iv) Signature and incumbency certificates of its officers
executing the Loan Documents to which it is a party;
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(v) Executed originals of the Loan Documents to which it is a
party; and
(vi) Such other documents as Administrative Agent may
reasonably request.
D. Opinions of Company's Counsel. Lenders and their respective counsel
shall have received (i) originally executed copies of the favorable written
opinion of Horn, Goldberg, Gorny, Daniels, Plackter & ▇▇▇▇▇, counsel for
Company, in form and substance reasonably satisfactory to Administrative Agent
and its counsel, dated as of the Closing Date and setting forth substantially
the matters in the opinions designated in Exhibit IX-A annexed hereto and as to
such other matters as Administrative Agent acting on behalf of Lenders may
reasonably request and (ii) opinions from special counsel to Company (including
admiralty counsel) with respect to such matters governed by the laws of the
states of Nevada, Illinois, Louisiana, Indiana, Kentucky, Missouri and by
maritime law as Administrative Agent acting on behalf of Lenders may reasonably
request.
E. Opinions of Administrative Agent's Counsel. Lenders shall have
received originally executed copies of one or more favorable written opinions of
O'Melveny & ▇▇▇▇▇, counsel to Administrative Agent, dated as of the Closing
Date, substantially in the form of Exhibit IX-B annexed hereto and as to such
other matters as Administrative Agent acting on behalf of Lenders may reasonably
request.
F. Perfection of Security Interests. Loan Parties shall have taken or
caused to be taken such actions in such a manner so that Administrative Agent,
on behalf of Lenders, or the Trustee, solely for the benefit of the
Administrative Agent, on behalf of Lenders, as the case may be, each has a valid
and perfected first priority security interest in all Collateral in which a Lien
is purported to be granted by the Collateral Documents. Such actions shall
include, without limitation: (i) the delivery pursuant to the applicable
Collateral Documents of all instruments (properly endorsed in blank for
transfer, all in form and substance satisfactory to Administrative Agent)
representing all shares of the capital stock of each Guarantor; (ii) the
delivery to Administrative Agent of Uniform Commercial Code financing
statements, executed by Company as to the Collateral granted by Company for all
jurisdictions as may be necessary or desirable to perfect Administrative Agent's
security interest in such Collateral; (iii) evidence that counterparts of the
Mortgages were recorded in all locations to the extent necessary or desirable,
in the reasonable judgment of Administrative Agent, to effectively create a
valid and enforceable first priority Lien (subject only to Permitted
Encumbrances) on the Premises (including the Improvements constructed thereon)
in favor of Administrative Agent for the benefit of Lenders; (iv) evidence
reasonably satisfactory to Administrative Agent that all other filings,
recordings and other actions Administrative Agent deems necessary or advisable
to establish, preserve and perfect the first priority Liens granted to
Administrative Agent in the Collateral shall have been made, including, without
limitation, with respect to any Facilities leased by any Loan Party, evidence
that all consents necessary to or, in the opinion of Administrative Agent,
advisable for the
69
granting of a Lien on such Loan Party's interest have been obtained from the
landlord owning such Facilities and that any amendment or other modification to
the leases applicable to such Facilities deemed advisable by Administrative
Agent to make them financable shall have been executed and delivered by all
necessary parties; and (v) the Ship Mortgages shall have been duly filed with
the appropriate office of the United States Coast Guard and shall constitute a
duly perfected first "preferred mortgage" lien on such Ship or US Documented
Barge in favor of the Trustee, solely for the benefit of Administrative Agent on
behalf of Lenders, within the meaning of the Ship Mortgage Act of 1920, as
amended and codified in Chapter 313 of Title 46 of the United States Code.
G. Title Policy. Lenders shall have received an American Land Title
Association Extended Coverage Loan Policy (1990, without modification, revision
or amendment) (the "Title Policy") (with proof of the payment of the premiums
thereon) or commitment therefor in form and substance acceptable to Lenders
issued by a title company approved by Lenders (the "Title Company"), together
with coinsurance and reinsurance from title insurance companies approved by
Lenders, showing the respective Subsidiary as the owner in fee simple, or the
lessee (in the case of real property leased by such Subsidiary) of its Premises,
and insuring the lien of the Mortgages to be a first lien against each of the
Premises, free and clear of all defects, encumbrances and exceptions, except the
Permitted Encumbrances, together with such affirmative insurance as Lenders may
require. The Title Policy shall contain, among other things:
(i) Full coverage against mechanic's liens (filed and
inchoate);
(ii) A reference to the survey but no survey exceptions except
those theretofore approved in writing by Administrative Agent and its
counsel;
(iii) A variable interest rate endorsement;
(iv) A "revolving credit line" endorsement"; and
(v) A "pending disbursements" clause in substantially the
following form:
"Pending disbursement of the full proceeds of the loan secured
by the deed of trust set forth under Schedule A thereof, this policy
insures only to the extent of the amount actually disbursed but
increases as each disbursement is made in good faith and without
knowledge of any defects in, or objections to, the title up to the face
amount of the policy.
At the time of each disbursement of the proceeds of the loan,
the title must be continued down to such time for possible liens or
objections intervening between the date hereof and the date of such
disbursement."
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▇. ▇▇▇▇▇ Insurance. Administrative Agent shall have been provided with
satisfactory evidence, which may be in the form of a letter from an insurance
broker, municipal engineer, or other knowledgeable source unaffiliated with
Company, as to whether (a) any of the Premises are located in an area designated
by the Department of Housing and Urban Development as having special flood or
mudslide hazards, and (b) any of the communities in which any of the Facilities
are located is participating in the National Flood Insurance Program. If both of
the aforesaid conditions exist, Administrative Agent shall receive satisfactory
policies of flood insurance covering the applicable Improvements as required by
the Flood Act.
I. UCC and Judgment Searches. Administrative Agent shall have received
current searches of the UCC filing offices and judgment searches with the
Offices of the Secretary of States of Illinois, Louisiana and Nevada, the local
recorders office in each county or parish in which any of the Premises are
located and elsewhere showing no security interests or judgments affecting the
Facilities or any Collateral except to the extent permitted pursuant to
subsection 7.2.
J. Necessary Consents. On or before the Closing Date, each Loan Party
shall have obtained all consents that are required for the operation of the
Facilities, in each case, and the transactions contemplated under this Agreement
and the other Loan Documents of (i) Illinois Gaming Authorities, Louisiana
Gaming Authorities, Nevada Gaming Authorities and other Governmental Authorities
and (ii) any Person required under any Contractual Obligation of any Loan Party,
all of the foregoing in form and substance satisfactory to Administrative Agent.
K. Fees. Company shall have paid to Administrative Agent, for
distribution (as appropriate) to Administrative Agent and Lenders, the fees
payable on the Closing Date referred to in subsection 2.3.
L. Administrative Agent's Counsel Fees. Company shall have paid the
reasonable fees and disbursements of counsel to Administrative Agent.
M. No Material Adverse Effect. Since March 31, 1994, no Material
Adverse Effect (in the sole opinion of each Lender) shall have occurred.
N. Representations and Warranties; Performance of Agreements. Company
shall have delivered to Administrative Agent an Officers' Certificate, in form
and substance satisfactory to Administrative Agent, to the effect that the
representations and warranties in Section 5 hereof are true, correct and
complete on and as of the Closing Date to the same extent as though made on and
as of that date and that Company shall have performed all agreements and
satisfied all conditions which this Agreement provides shall be performed or
satisfied by it on or before the Closing Date except as otherwise disclosed to
and agreed to in writing by Administrative Agent and each Lender.
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O. Completion of Proceedings. All corporate and other proceedings taken
or to be taken in connection with the transactions contemplated hereby and all
documents incidental thereto not previously found acceptable by Administrative
Agent, acting on behalf of Lenders, and its counsel shall be satisfactory in
form and substance to Administrative Agent and such counsel, and Administrative
Agent and such counsel shall have received all such counterpart originals or
certified copies of such documents as Administrative Agent may reasonably
request.
P. Insurance. Administrative Agent shall have received original
binders evidencing Company or one or more of its Subsidiaries as named insured
and original certificates of Policies of Insurance, together with loss payable
and mortgagee endorsements specifically including Administrative Agent and
Lenders as mortgagees, loss payees and additional insureds as required by the
applicable insurance provisions set forth in subsection 6.4B hereof and in
Schedules 6.4(a) and 6.4(b) annexed hereto, section 6 of each of the Mortgages
and within each of the Ship Mortgages under the heading "Vessel Insurance
Requirements and Provisions", accompanied by affidavits, certificates, paid
bills or other documents evidencing that all premium payments are current.
Q. Delivery of Pricing Determination Certificate. Administrative Agent
shall have received a Pricing Determination Certificate calculated utilizing the
most recent financial statements delivered to Administrative Agent.
R. Survey. Administrative Agent shall have received and approved a
current boundary and location survey for each of the Premises each of which must
(i) be certified to Administrative Agent and the Title Company and (ii) meet the
Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys
established by ALTA and ACSM in 1992.
S. Environmental Assessment. Administrative Agent shall, within 60 days
of the Closing Date, have received written environmental assessment reports and
other information in form, scope and substance satisfactory to Administrative
Agent, independently prepared by an environmental consultant acceptable to
Administrative Agent, evidencing the results of an environmental assessment
performed for the purpose of assessing current environmental liabilities of
Company and its Subsidiaries (including, without limitation, the environmental
condition of the Premises). If such environmental assessment recommends any
action be taken with respect to any of the Premises, Administrative Agent shall
have received evidence satisfactory to Administrative Agent that such action has
been taken.
T. No Disruption of Financial and Capital Markets. There shall have
been no material adverse change since March 15, 1995 to the syndication markets
for credit facilities similar in nature to this credit facility and there shall
not have occurred and be continuing a material disruption of or material adverse
change in financial, banking or
72
capital markets that would have an adverse effect on such syndication market, in
each case as determined by Co-Arrangers in their sole discretion.
U. Financial Statements. Administrative Agent shall have received from
Company its audited financial statements for the period ended March 31, 1995 and
its unaudited financial statements for each subsequent Fiscal Quarter prior to
the Closing Date (excluding the Fiscal Quarter ended June 30, 1995).
V. Appraisals. Administrative Agent shall have received appraisals,
including an appraisal by an independent professional Marine Appraiser, in form,
scope and substance satisfactory thereto and satisfying the requirements of any
applicable laws and regulations concerning the real property Collateral, the
Ships and the Barges securing the Loans.
W. Ship Inspection. Administrative Agent shall have received copies of
current certificates of inspection issued by the United States Coast Guard for
each of the Ships.
X. Title to Ships and Barges. Administrative Agent shall have received
evidence satisfactory in form and substance to Administrative Agent that:
(i) SIRCC, PLC, SSP and PRLLC each have good and valid title to
the Ship or Ships and the Barge or Barges owned by it, free and clear
of all liens, charges, encumbrances and security interests;
(ii) each Ship and each US Documented Barge listed on Schedule
5.5 is subject to a valid certificate of documentation identifying
SIRCC, PLC, SSP or PRLLC, as the case may be, as the registered owner
thereof under the laws and regulations of the United States; and
(iii) SIRCC, PLC, SSP and PRLLC each have all necessary
authority required to own and operate the Ship or Ships and the Barge
or Barges owned by it for such Ships' or Barges' intended purposes.
Y. Leases. Administrative Agent shall have received complete copies of
all leases for any of the properties and facilities comprising all or any
portion of the Facilities that are leased by Company or any of its Subsidiaries,
and a "landlord estoppel certificate" for such leases, certifying that no
defaults by the lessee currently exist under any such lease and confirming,
among other things, the annual rental amount paid by Company or its Subsidiaries
to lessor thereunder.
Z. Governmental Authorizations. Administrative Agent shall have
received satisfactory evidence that Company and its Subsidiaries have obtained
all Governmental Authorizations (including, without limitation, Governmental
Authorizations from Gaming Authorities and all zoning approvals, special or
conditional use permits, variances,
73
permits, licenses, liquor licenses, certificates of occupancy and franchises)
necessary to permit the use, occupancy and operation of each of the Facilities.
AA. [Intentionally Omitted]
BB. Leasehold Documents. Administrative Agent shall have
received executed copies of each Leasehold Document, each such Leasehold
Document containing terms and provisions in form and substance satisfactory to
Administrative Agent in order to protect the enforceability of the Mortgages to
be granted to Administrative Agent on certain leasehold interests of Company
and its Subsidiaries.
4.2 Conditions to All Loans.
The obligations of Lenders to make Revolving Loans and of Swing
Line Lender to make Swing Line Loans on each Funding Date are subject to the
following further conditions precedent:
A. Administrative Agent shall have received before that Funding
Date, in accordance with the provisions of subsection 2.1C, an originally
executed Notice of Borrowing, in each case signed by the chief executive
officer, the chief financial officer or the treasurer of Company or by any
executive officer of Company designated by any of the above-described officers
on behalf of Company in a writing delivered to Administrative Agent.
B. As of that Funding Date:
(i) The representations and warranties contained herein and in
the other Loan Documents shall be true, correct and complete in all
material respects on and as of that Funding Date to the same extent as
though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been true,
correct and complete in all material respects on and as of such earlier
date;
(ii) No event shall have occurred and be continuing or would
result from the consummation of the borrowing contemplated by such
Notice of Borrowing that would constitute an Event of Default or, to
Company's Best Knowledge, a Potential Event of Default;
(iii) Company shall have performed in all material respects all
agreements and satisfied all conditions which this Agreement provides
shall be performed or satisfied by it on or before that Funding Date;
(iv) No order, judgment or decree of any court, arbitrator
or governmental authority shall purport to enjoin or restrain any
Lender from
74
making the Loans to be made by it on that Funding Date; provided that
any such order, judgment or decree shall only relieve that Lender on
whom such order, judgment or decree is binding from its obligation to
make Loans to Company.
(v) The making of the Loans requested on such Funding Date
shall not violate any law including, without limitation, Regulation G,
Regulation T, Regulation U or Regulation X of the Board of Governors of
the Federal Reserve System;
(vi) There shall not be pending or, to the knowledge of
Company, threatened, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries that
has not been disclosed by Company in writing pursuant to subsection 5.6
or 6.1(x) prior to the making of the last preceding Loans (or, in the
case of the initial Loans, prior to the execution of this Agreement),
and there shall have occurred no development not so disclosed in any
such action, suit, proceeding, governmental investigation or
arbitration so disclosed, that, in either event, in the opinion of
Administrative Agent or of Requisite Lenders, would be expected to have
a Material Adverse Effect; and no injunction or other restraining order
shall have been issued and no hearing to cause an injunction or other
restraining order to be issued shall be pending or noticed with respect
to any action, suit or proceeding seeking to enjoin or otherwise
prevent the consummation of, or to recover any damages or obtain relief
as a result of, the transactions contemplated by this Agreement or the
making of Loans hereunder; and
(vii) Since March 31, 1994, no Material Adverse Effect (in the
sole opinion of each Lender) shall have occurred; provided that such
opinion by any Lender as to the occurrence of a Material Adverse Effect
shall only relieve that Lender holding such opinion from its obligation
to make Loans to Company.
C. Neither Administrative Agent nor any Lender has given each
other Lender written notice that it has actual knowledge of the occurrence of
any event that, on such Funding Date, causes any of the representations and
warranties to be made by Company on such date to be untrue in any material
respect as of such date.
4.3 Conditions to Letters of Credit.
The issuance of any Letter of Credit hereunder is subject to
the following conditions precedent:
A. On or before the date of issuance of the initial Letter of
Credit pursuant to this Agreement, the initial Loans shall have been made.
75
B. On or before the date of issuance of such Letter of Credit,
Administrative Agent shall have received, in accordance with the provisions of
subsection 3.1B(i), an originally executed Notice of Issuance of Letter of
Credit, signed by the chief executive officer, the chief financial officer or
the treasurer of Company or by any executive officer of Company designated by
any of the above-described officers on behalf of Company in a writing delivered
to Administrative Agent, together with all other information specified in
subsection 3.1B(i) and such other documents or information as Administrative
Agent may reasonably require in connection with the issuance of such Letter of
Credit.
C. On the date of issuance of such Letter of Credit, all conditions
precedent described in subsection 4.2B shall be satisfied to the same extent as
if the issuance of such Letter of Credit were the making of a Loan and the date
of issuance of such Letter of Credit were a Funding Date.
Section 5. COMPANY'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to
make the Loans, to induce Administrative Agent to issue Letters of Credit and to
induce other Lenders to purchase participations therein, Company represents and
warrants to each Lender, on the date of this Agreement, on each Funding Date and
on the date of issuance of each Letter of Credit, that the following statements
are true, correct and complete:
5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries.
A. Organization and Powers. Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada.
Company has all requisite corporate power and authority to own and operate its
properties, to carry on its business as now conducted and as proposed to be
conducted, to enter into the Loan Documents and to carry out the transactions
contemplated thereby.
B. Qualification and Good Standing. Company is qualified to do business
and in good standing in every jurisdiction where its assets are located and
wherever necessary to carry out its business and operations, except in
jurisdictions where the failure to be so qualified or in good standing has not
had and, to Company's Best Knowledge, will not have a Material Adverse Effect.
C. Conduct of Business. Company and its Subsidiaries are engaged only
in the businesses permitted to be engaged in pursuant to subsection 7.10.
D. Subsidiaries. All of the Subsidiaries of Company are identified in
Schedule 5.1 annexed hereto, as said Schedule 5.1 may be supplemented from time
to time pursuant to the provisions of subsection 6.1(xvii). The capital stock of
each of the Subsidiaries of Company identified in Schedule 5.1 annexed hereto
(as so supplemented)
76
is duly authorized, validly issued, fully paid and nonassessable and none of
such capital stock constitutes Margin Stock. Each of the Subsidiaries of Company
identified in Schedule 5.1 annexed hereto (as so supplemented) is a corporation
duly organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation set forth therein, has all requisite
corporate power and authority to own and operate its properties and to carry on
its business as now conducted and as proposed to be conducted, and is qualified
to do business and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and operations, in each
case except where failure to be so qualified or in good standing or a lack of
such corporate power and authority has not had and, to Company's Best Knowledge,
will not have a Material Adverse Effect. Schedule 5.1 annexed hereto (as so
supplemented) correctly sets forth the ownership interest of Company and each of
its Subsidiaries in each of the Subsidiaries of Company identified therein.
5.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and performance
of the Loan Documents have been duly authorized by all necessary corporate
action on the part of Company.
B. No Conflict. The execution, delivery and performance by each Loan
Party of the Loan Documents and the consummation of the transactions
contemplated by the Loan Documents do not and, to Company's Best Knowledge, will
not (i) violate (X) any provision of any law or any governmental rule or
regulation applicable to Company or any of its Subsidiaries the violation of
which could have a Material Adverse Effect, (Y) the Certificate or Articles of
Incorporation or Bylaws of Company or any of its Subsidiaries or (Z) any order,
judgment or decree of any court or other agency of government binding on Company
or any of its Subsidiaries the violation of which could have a Material Adverse
Effect, (ii) conflict with, result in a breach of or constitute (with due notice
or lapse of time or both) a default under any Contractual Obligation of Company
or any of its Subsidiaries, if the execution of any of the Loan Documents would
afford any party (other than Company) the right (after the giving of notice or
lapse of time or both) to terminate such Contractual Obligation or seek judicial
relief against Company as a result thereof, (iii) result in or require the
creation or imposition of any Lien upon any of the properties or assets of
Company or any of its Subsidiaries (other than any Liens created under any of
the Loan Documents in favor of Administrative Agent on behalf of Lenders), or
(iv) require any approval of stockholders or any approval or consent of any
Person under any Contractual Obligation of Company or any of its Subsidiaries,
except for such approvals or consents which will be obtained on or before the
Closing Date and disclosed in writing to Lenders.
C. Governmental Consents. The execution, delivery and performance by
the Loan Parties of the Loan Documents and the consummation of the transactions
contemplated by the Loan Documents do not and will not require any registration
with, consent or approval of, or notice to, or other action to, with or by, any
federal, state or
77
other governmental authority or regulatory body except (i) those that have been
obtained and copies of which have been delivered to Administrative Agent
pursuant to subsection 4.1J or the absence of which Administrative Agent has
deemed satisfactory pursuant to subsection 4.1J, (ii) those notices or
informational filings or both that will be required to be given to the
Securities and Exchange Commission or any Gaming Board but that are not yet due
and (iii) any right of any Gaming Board to object to any Lender or participant
in the Loans at any future date.
D. Binding Obligation. Each of the Loan Documents has been duly
executed and delivered by the Loan Parties signatory thereto and is the legally
valid and binding obligation of such Loan Party, enforceable against such Loan
Party in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles relating to
enforceability.
5.3 Financial Condition.
Company has heretofore delivered to Lenders, at Lenders'
request, the following financial statements and information: (i) the audited
consolidated balance sheet of Company and its Subsidiaries as at March 31, 1995
and the related consolidated statements of income, stockholders' equity and cash
flows of Company and its Subsidiaries for the Fiscal Year then ended and (ii)
the unaudited consolidated and Consolidating balance sheets of Company and its
Subsidiaries as at June 30, 1995 and the related unaudited consolidated and
Consolidating statements of income, stockholders' equity and cash flows of
Company and its Subsidiaries for the three months then ended. All such
statements were prepared in conformity with GAAP and fairly present the
financial position (on a consolidated and, where applicable, Consolidating
basis) of the entities described in such financial statements as at the
respective dates thereof and the results of operations and cash flows (on a
consolidated and, where applicable, Consolidating basis) of the entities
described therein for each of the periods then ended, subject, in the case of
any such unaudited financial statements, to changes resulting from audit and
normal year-end adjustments, including the information presented in the
footnotes to Company's audited financial statements. Company does not (and will
not following the funding of the initial Loans) have any Contingent Obligation,
contingent liability or liability for taxes, long-term lease or unusual forward
or long-term commitment that is not reflected in the foregoing financial
statements or the notes thereto or, following the funding of initial Loans, in
the financial statements required to be delivered pursuant to subsection 6.1 and
which in any such case is material in relation to the business, operations,
properties, assets, condition (financial or otherwise) or prospects of Company
and its Subsidiaries, taken as a whole.
5.4 No Material Adverse Change; No Restricted Payments.
Since March 31, 1994, no event or change has occurred that has caused
or evidences, either in any case or in the aggregate, a Material Adverse Effect.
Neither
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Company nor any of its Subsidiaries has directly or indirectly declared,
ordered, paid or made, or set apart any sum or property for, any Restricted
Payment or agreed to do so except as permitted by subsection 7.5.
5.5 Title to Properties; Liens.
A. Company and its Subsidiaries have (i) good, sufficient and legal
title to (in the case of fee interests in real property), (ii) valid leasehold
interests in (in the case of leasehold interests in real or personal property),
or (iii) good title to (in the case of all other personal property), all of
their respective properties and assets reflected in the financial statements
referred to in subsection 5.3 or in the most recent financial statements
delivered pursuant to subsection 6.1, in each case except for assets disposed of
since the date of such financial statements in the ordinary course of business
or as otherwise permitted under subsection 7.7. Except as permitted by this
Agreement, all such properties and assets are free and clear of Liens.
B. (i) All of the assets, of whatever kind and nature, whether
real, personal or mixed property, used in connection with the Illinois
Facilities or placed or located in or on the Illinois Premises are
owned or leased directly by SIRCC and not by Company or any of
Company's other Subsidiaries.
(ii) All of the assets, of whatever kind and nature, whether
real, personal or mixed property, used in connection with the Louisiana
Facilities or placed or located in or on the Louisiana Premises are
owned or leased directly by PLC, SSP or PRLLC and not by Company or any
of Company's other Subsidiaries.
(iii) All of the assets, of whatever kind and nature, whether
real, personal or mixed property, used in connection with the Nevada
Facilities or placed or located in or on the Nevada Premises are owned
or leased directly by PNEV, PMGC or PML and not by Company or any of
Company's other Subsidiaries.
C. (i) SIRCC, PLC, SSP and PRLLC each have good and valid
title to the Ship or Ships and the Barge or Barges owned by it, free
and clear of all liens, charges, encumbrances and security interests;
(ii) each Ship and each US Documented Barge listed on Schedule
5.5, as said Schedule 5.5 may be supplemented from time to time
pursuant to the provisions of subsection 6.1(xx), is subject to a valid
certificate of documentation identifying SIRCC, PLC, SSP or PRLLC, as
the case may be, as the registered owner thereof under the laws and
regulations of the United States; and
(iii) SIRCC, PLC, SSP and PRLLC each have all necessary
authority required to own and operate the Ship or Ships and the Barge
or Barges owned by it for such Ships' or Barges' intended purposes.
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D. On the Closing Date, the only water craft of any nature whatsoever
(whether constituting a vessel, Barge, floating structure or otherwise) owned by
Company or any of its Subsidiaries that is subject to a valid certificate of
documentation pursuant to the laws of the United States of America are the
Players Lake ▇▇▇▇▇▇▇ Riverboat, the Lake ▇▇▇▇▇▇▇ Star Riverboat, the Metropolis
Riverboat and the US Documented Barges described on Schedule 5.5. All Other
Barges that are located at the Illinois Facilities and the Louisiana Facilities
are documented, registered or certified pursuant to the laws of the state of
Illinois or Louisiana, respectively.
5.6 Litigation; Adverse Facts.
Except as set forth in Schedule 5.6 annexed hereto, there are
no actions, suits, proceedings, arbitrations or, to Company's Best Knowledge,
governmental investigations (whether or not purportedly on behalf of Company or
any of its Subsidiaries) at law or in equity or before or by any federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, pending or, to the knowledge of Company,
threatened against or affecting Company or any of its Subsidiaries or any
property of Company or any of its Subsidiaries that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.
Neither Company nor any of its Subsidiaries is (i) in violation of any
applicable laws that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect or (ii) subject to or in default
with respect to any final judgments, writs, injunctions, decrees, rules or
regulations of any court or any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.
5.7 Payment of Taxes.
Except to the extent permitted by subsection 6.3, all tax
returns and reports of Company and its Subsidiaries required to be filed by any
of them have been timely filed, and all taxes, assessments, fees and other
governmental charges upon Company and its Subsidiaries and upon their respective
properties, assets, income, businesses and ▇▇▇▇- chises which are due and
payable have been paid when due and payable. Company knows of no proposed tax
assessment against Company or any of its Subsidiaries which has not been
provided for or which is not being actively contested by Company or such
Subsidiary in good faith and by appropriate proceedings; provided that such
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefor.
5.8 Performance of Agreements; Materially Adverse Agreements.
A. Neither Company nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the
80
giving of notice or the lapse of time or both, would constitute such a default,
except where the consequences, direct or indirect, of such default or defaults,
if any, would not have a Material Adverse Effect.
B. Neither Company nor any of its Subsidiaries is a party to or is
otherwise subject to any agreements or instruments or any charter or other
internal restrictions which, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.
5.9 Governmental Regulation.
Neither Company nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act or the Investment Company Act of 1940 or
under any other federal or state statute or regulation which may limit its
ability to incur Indebtedness or which may otherwise render all or any portion
of the Obligations unenforceable.
5.10 Securities Activities.
A. Neither Company nor any of its Subsidiaries is engaged principally,
or as one of its important activities, in the business of extending credit for
the purpose of purchasing or carrying any Margin Stock.
B. Following application of the proceeds of each Loan, not more than
25% of the value of the assets (either of Company only or of Company and its
Subsidiaries on a consolidated basis) subject to the provisions of subsection
7.2 or 7.7 or subject to any restriction contained in any agreement or
instrument, between Company and any Lender or any Affiliate of any Lender,
relating to Indebtedness and within the scope of subsection 8.2, will be Margin
Stock.
5.11 Employee Benefit Plans.
A. Company and each of its ERISA Affiliates are in compliance with all
applicable provisions and requirements of ERISA and the regulations and
published interpretations thereunder with respect to each Employee Benefit Plan,
and have performed all their obligations under each Employee Benefit Plan.
B. No ERISA Event has occurred or is reasonably expected to occur with
respect to Company or any of its ERISA Affiliates.
C. Except to the extent required under Section 4980B of the Internal
Revenue Code or except as set forth in Schedule 5.11 annexed hereto, no Employee
Benefit Plan provides health or welfare benefits (through the purchase of
insurance or otherwise) for any retired or former employees of Company or any of
its ERISA Affiliates.
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D. As of the most recent valuation date for any Pension Plan, the
amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which assets
exceed benefit liabilities), does not exceed $5,000,000.
5.12 Certain Fees.
No broker's or finder's fee or commission will be payable with
respect to this Agreement or any of the transactions contemplated hereby, and
Company hereby indemnifies Administrative Agent, Managing Agents and
Co-Arrangers against, and agrees that it will hold Administrative Agent,
Managing Agents and Co-Arrangers harmless from, any claim, demand or liability
for any such broker's or finder's fees alleged to have been incurred by
Administrative Agent, Managing Agents or Co- Arrangers as the result of any
action or inaction by Company in connection herewith or therewith and any
expenses (including reasonable fees, expenses and disbursements of counsel)
arising in connection with any such claim, demand or liability.
5.13 Environmental Protection.
Except as set forth in Schedule 5.13 annexed hereto:
(i) the operations of Company and each of its
Subsidiaries (including, without limitation, all operations and
conditions at or in the Facilities) comply in all material respects
with all Environmental Laws;
(ii) Company and each of its Subsidiaries have obtained all
Governmental Authorizations under Environmental Laws necessary to their
respective operations, and all such Governmental Authorizations are in
good standing, and Company and each of its Subsidiaries are in
compliance with all material terms and conditions of such Governmental
Authorizations;
(iii) neither Company nor any of its Subsidiaries has received
(a) any notice or claim to the effect that it is or may be liable to
any Person as a result of or in connection with any Hazardous Materials
or (b) any letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act
(42 U.S.C. ss. 9604) or comparable state laws, and, to the best of
Company's knowledge, none of the operations of Company or any of its
Subsidiaries is the subject of any federal or state investigation
relating to or in connection with any Hazardous Materials at any
Facility or at any other location;
(iv) none of the operations of Company or any of its
Subsidiaries is subject to any judicial or administrative proceeding
alleging the violation of or liability under any Environmental Laws
which if adversely determined could reasonably be expected to have a
Material Adverse Effect;
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(v) neither Company nor any of its Subsidiaries nor any of
their respective Facilities or operations are subject to any
outstanding written order or agreement with any governmental authority
or private party relating to (a) any Environmental Laws or (b) any
Environmental Claims;
(vi) neither Company nor any of its Subsidiaries has any
contingent liability in connection with any Release of any Hazardous
Materials by Company or any of its Subsidiaries;
(vii) neither Company nor any of its Subsidiaries nor, to
Company's Best Knowledge, any predecessor of Company or any of its
Subsidiaries has filed any notice under any Environmental Law
indicating past or present treatment or Release of Hazardous Materials
at any Facility, and none of Company's or any of its Subsidiaries'
operations involves the generation, transportation, treatment, storage
or disposal of hazardous waste, as defined under 40 C.F.R. Parts
260-270 or any state equivalent;
(viii) no Hazardous Materials exist on, under or about any
Facility in a manner that has a reasonably possibility of giving rise
to an Environmental Claim having a Material Adverse Effect, and neither
Company nor any of its Subsidiaries has filed any notice or report of a
Release of any Hazardous Materials that has a reasonable possibility of
giving rise to an Environmental Claim having a Material Adverse Effect;
(ix) neither Company nor any of its Subsidiaries nor, to
Company's Best Knowledge, any of their respective predecessors has
disposed of any Hazardous Materials in a manner that has a reasonable
possibility of giving rise to an Environmental Claim having a Material
Adverse Effect;
(x) no surface impoundments are on or at any Facility or, to
Company's Best Knowledge, no underground storage tanks are on or at
any Facility; and
(xi) no Lien in favor of any Person relating to or in
connection with any Environmental Claim has been filed or has been
attached to any Facility.
5.14 Employee Matters.
There is no strike or work stoppage in existence or threatened
involving Company or any of its Subsidiaries that could reasonably be expected
to have a Material Adverse Effect.
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5.15 Solvency.
Company and each of its Subsidiaries is and, upon the
incurrence of any Obligations by Company on any date on which this
representation is made, will be, Solvent.
5.16 Disclosure.
No representation or warranty of Company or any of its
Subsidiaries contained in any Loan Document or in any other document,
certificate or written statement furnished to Lenders by or on behalf of Company
or any of its Subsidiaries for use in connection with the transactions
contemplated by this Agreement contains any untrue statement of a material fact
or omits to state a material fact (known to Company, in the case of any document
not furnished by it) necessary in order to make the statements contained herein
or therein not misleading in light of the circumstances in which the same were
made. Any projections and pro forma financial information contained in such
materials are based upon good faith estimates and assumptions believed by
Company to be reasonable at the time made, it being recognized by Lenders that
such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such projections may
differ from the projected results. To Company's Best Knowledge, no facts exist
(other than matters of a general economic nature) that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
and that have not been disclosed herein or in such other documents, certificates
and statements furnished to Lenders for use in connection with the transactions
contemplated hereby.
5.17 Compliance With Laws.
Company and its Subsidiaries are in compliance with the
requirements of all applicable laws, rules, regulations, ordinances and orders
(including, without limitation, Gaming Laws) if noncompliance would affect the
ability of any such party to operate any of the Facilities or the ability of any
of Company or any of its Subsidiaries to perform their obligations under the
Loan Documents to which it is a party, except where the failure to so comply or
perform would not have a Material Adverse Effect. The use of each of the
Facilities complies with applicable zoning ordinances, regulations, restrictive
covenants and requirements of Governmental Authorizations affecting the
respective Facilities as well as all environmental, ecological, landmark, and
other applicable laws and regulations (including, without limitation, Gaming
Laws); and all requirements for such use have been satisfied, except where the
failure to so comply would not have a Material Adverse Effect.
5.18 Representations Relating to Operation of Facilities.
A. The Nevada Facilities are open to the public and all
authorizations, licenses and permits required by any Governmental Authority for
the use, occupancy and
84
operation of the Nevada Premises for the purposes contemplated herein have been
obtained and all requirements for such use have been satisfied.
B. All utility services required to operate each of the Facilities are
available and in adequate supply.
5.19 Intangible Property.
Company and its Subsidiaries are the sole and exclusive owner
or licensee of all trade names, unregistered trademarks and service marks, brand
names, patents, registered and unregistered copyrights, registered trademarks
and service marks, and all applications for any of the foregoing, and all
permits, grants and licenses or other rights with respect thereto, except where
the absence of such sole ownership would not have a Material Adverse Effect.
Schedule 5.19 annexed hereto sets forth a true and complete list of all service
marks and registered trademarks (or trademarks for which registration is
pending) of Company and its Subsidiaries. None of Company and its Subsidiaries
has been charged with any material infringement of any intangible property of
the character described above or been notified or advised of any material claim
of any other Person relating to any of the intangible property.
5.20 Rights to Agreements, Permits and Licenses.
From and after the Closing Date, Company (or its Subsidiaries)
will be the true owner of all rights in and to all existing agreements, permits
and licenses relating to all of its facilities (now or hereafter acquired) and
each of the respective Premises (other than rights of third parties under leases
and agreements permitted hereunder), and will be the true owner of all rights in
and to all future agreements, permits and licenses relating to all of its
facilities (now or hereafter acquired), other than rights of third parties under
leases and agreements permitted hereunder, except where the absence of such true
ownership would not have a Material Adverse Effect. Company's interest in all
such agreements, permits, and licenses is not and, to Company's Best Knowledge,
will not be subject to any present claim (other than under the Loan Documents),
set-off or deduction other than in the ordinary course of business.
5.21 Classification of Ships.
From and after the Closing Date, the American Bureau of
Shipping classification of each Ship shall remain the highest applicable
classification and rating to which a ship of the same age and type as such Ship
can qualify under the rules and standards of the American Bureau of Shipping.
5.22 Recordation of Ship Mortgages.
Each Ship Mortgage is in due form for filing, and has been duly
filed in the appropriate office of the United States Coast Guard. Upon such
filing, each Ship
85
Mortgage will constitute a legal, valid and binding first preferred ship
mortgage under the Ship Mortgage Act of 1920, as amended and codified in Chapter
313 of Title 46 of the United States Code, on the applicable Ship or US
Documented Barge in favor of the Trustee as mortgagee under such Ship Mortgage
for the benefit of Administrative Agent on behalf of Lenders. No other filings
or recordings or refilings or re-recordings of any other instruments are
necessary to cause the lien of any of the Ship Mortgages to be legal, valid and
binding on the parties thereto, and to create in favor of the Trustee, as
secured party, for the benefit of the Administrative Agent on behalf of Lenders,
the preferred mortgage which the Ship Mortgages purport to create.
5.23 Policies of Insurance.
Each of the copies of the declaration pages, original binders
and certificates of insurance evidencing the Policies of Insurance delivered to
Administrative Agent pursuant to subsection 4.1P is a true, correct and complete
copy of the respective original thereof as in effect on the date hereof, and no
amendments or modifications of said documents or instruments not included in
such copies have been made. Furthermore, none of such documents or instruments
has been terminated and each is in full force and effect. Neither the Company
nor any of its Subsidiaries are in default in the observance or performance of
their respective obligations under said documents and instruments and Company
and its Subsidiaries have taken all actions required to be performed under all
Policies of Insurance to keep unimpaired their rights thereunder.
Section 6. COMPANY'S AFFIRMATIVE COVENANTS
Company covenants and agrees that, so long as the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless each Lender shall otherwise give prior written consent, Company
shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 6.
6.1 Financial Statements and Other Reports.
Company will maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
conformity with GAAP.
Company will deliver to Administrative Agent and Lenders:
(i) Quarterly Financials: as soon as available and in any event
within 45 days after the end of each of the first three Fiscal Quarters
of each Fiscal Year and, with respect to the fourth Fiscal Quarter of
each Fiscal Year, concurrently with the delivery of financial
statements pursuant to subdivision (ii) below, (a) (1) the consolidated
and Consolidating balance sheets of Company and its Subsidiaries as at
the end of such Fiscal Quarter and the related consolidated and
86
Consolidating statements of income, stockholders' equity and cash flows
of Company and its Subsidiaries for such Fiscal Quarter and for the
period from the beginning of the then current Fiscal Year to the end of
such Fiscal Quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous
Fiscal Year and the corresponding figures from the consolidated plan
and financial forecast for the current Fiscal Year delivered pursuant
to subsection 6.1(xiii), all in reasonable detail and certified by the
chief financial officer of Company that they fairly present the
financial condition of Company and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for
the periods indicated, subject to changes resulting from audit and
normal year-end adjustments and (2) copies of Company's relevant 10-Q
filed with the Securities and Exchange Commission within 15 days of
such filing;
(ii) Year-End Financials: as soon as available and in any event
within 90 days after the end of each Fiscal Year, (a) (1) the
consolidated and Consolidating balance sheets of Company and its
Subsidiaries as at the end of such Fiscal Year and the related
consolidated and Consolidating statements of income, stockholders'
equity and cash flows of Company and its Subsidiaries for such Fiscal
Year, setting forth in each case in comparative form the corresponding
figures for the previous Fiscal Year and, when available, the
corresponding figures from the consolidated plan and financial forecast
delivered pursuant to subsection 6.1(xiii) for the Fiscal Year covered
by such financial statements, all in reasonable detail and certified by
the chief financial officer of Company that they fairly present the
financial condition of Company and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for
the periods indicated, and (2) copies of Company's relevant 10-K filed
with the Securities and Exchange Commission within 15 days of such
filing, and (b) in the case of such consolidated financial statements,
a report thereon of Ernst & Young, LLP or other independent certified
public accountants of recognized national standing selected by Company
and satisfactory to Managing Agents, which report shall be unqualified,
shall not express any doubts about the ability of Company and its
Subsidiaries to continue as a going concern, and shall state that such
consolidated financial statements fairly present the consolidated
financial position of Company and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for
the periods indicated in conformity with GAAP applied on a basis
consistent with prior years (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in
connection with such consolidated financial statements has been made in
accordance with generally accepted auditing standards;
(iii) Officers' and Compliance Certificates: (a) together with
each delivery of financial statements of Company and its Subsidiaries
pursuant to subdivisions (i) and (ii) above, an Officers' Certificate
of Company stating that the signers have reviewed the terms of this
Agreement and have made, or caused to
87
be made under their supervision, a review in reasonable detail of the
transactions and condition of Company and its Subsidiaries during the
accounting period covered by such financial statements and that such
review has not disclosed the existence during or at the end of such
accounting period, and that the signers do not have actual knowledge of
the existence as at the date of such Officers' Certificate, of any
condition or event that constitutes an Event of Default or Potential
Event of Default, or, if any such condition or event existed or exists,
specifying the nature and period of existence thereof and what action
Company has taken, is taking and proposes to take with respect thereto;
and (b) together with each delivery of financial statements of Company
and its Subsidiaries pursuant to subdivision (i) above, a Compliance
Certificate demonstrating in reasonable detail compliance (X) during
and at the end of the applicable accounting periods with the
restrictions contained in subsections 7.1, 7.3, 7.4 and 7.5 and (Y) at
the end of the applicable accounting periods with the restrictions
contained in subsection 7.6;
(iv) Reconciliation Statements: if, as a result of any change
in accounting principles and policies from those used in the
preparation of the audited financial statements referred to in
subsection 5.3, the consolidated financial statements of Company and
its Subsidiaries delivered pursuant to subdivisions (i) and (ii) of
this subsection 6.1 will differ in any material respect from the
consolidated financial statements that would have been delivered
pursuant to such subdivisions had no such change in accounting
principles and policies been made, then (a) together with the first
delivery of financial statements pursuant to subdivision (i) and (ii)
of this subsection 6.1 following such change, consolidated financial
statements of Company and its Subsidiaries for (y) the current Fiscal
Year to the effective date of such change and (z) the two full Fiscal
Years immediately preceding the Fiscal Year in which such change is
made, in each case prepared on a pro forma basis as if such change had
been in effect during such periods, and (b) together with each delivery
of financial statements pursuant to subdivision (i) and (ii) of this
subsection 6.1 following such change, a written statement of the chief
accounting officer or chief financial officer of Company setting forth
the differences which would have resulted if such financial statements
had been prepared without giving effect to such change;
(v) Accountants' Certification: together with each delivery of
consolidated financial statements of Company and its Subsidiaries
pursuant to subdivision (ii) above, a written statement by the
independent certified public accountants giving the report thereon (a)
stating that their audit examination has included a review of the terms
of this Agreement and the other Loan Documents as they relate to
accounting matters, (b) stating whether, in connection with their audit
examination, any condition or event that constitutes an Event of
Default or Potential Event of Default has come to their attention and,
if such a condition or event has come to their attention, specifying
the nature and period of existence thereof; provided that such
accountants shall not be liable by reason of any failure
88
to obtain knowledge of any such Event of Default or Potential Event of
Default that would not be disclosed in the course of their audit
examination, and (c) stating that based on their audit examination
nothing has come to their attention that causes them to believe either
or both that the information contained in the certificates delivered
therewith pursuant to subdivision (iv) above is not correct or that the
matters set forth in the Compliance Certificates delivered therewith
pursuant to clause (b) of subdivision (iii) above for the applicable
Fiscal Year are not stated in accordance with the terms of this
Agreement;
(vi) Accountants' Reports: promptly upon, but in no case later
than 15 calendar days after, receipt thereof (unless restricted by
applicable professional standards), copies of all reports submitted to
Company by independent certified public accountants in connection with
each annual, interim or special audit of the financial statements of
Company and its Subsidiaries made by such accountants, including,
without limitation, any comment letter submitted by such accountants to
management in connection with their annual audit;
(vii) Insurance: as soon as practicable and in any event by the
last day of each Fiscal Year, a report in form and substance
satisfactory to Administrative Agent outlining all material insurance
coverage maintained as of the date of such report by Company and its
Subsidiaries (including all coverages referred to in subsection 6.4B
hereof and Schedules 6.4(a) and 6.4(b) annexed hereto, section 6 of
each of the Mortgages and within each of the Ship Mortgages under the
heading "Vessel Insurance Requirements and Provisions") and all
material insurance coverage then planned to be maintained by Company
and its Subsidiaries in the immediately succeeding Fiscal Year, if in
each case there shall be any material changes in such insurance
coverage from the insurance coverage in existence on the date hereof;
(viii) SEC Filings and Press Releases: promptly upon their
becoming available but in any event within 15 days after filing with
the Securities and Exchange Commission, copies of (a) all financial
statements, reports, notices and proxy statements sent or made
available generally by Company to its security holders or by any
Subsidiary of Company to its security holders other than Company or
another Subsidiary of Company, (b) all regular and periodic reports and
all registration statements (other than on Form S-8 or a similar form)
and prospectuses, if any, filed by any of Company's Subsidiaries with
any securities exchange or with the Securities and Exchange Commission
or any governmental or private regulatory authority, and (c) all press
releases and other statements made available generally by Company or
any of Company's Subsidiaries to the public concerning material
developments in the business of Company or any of Company's
Subsidiaries;
(ix) Events of Default, etc.: promptly, but in any event
within 5 calendar days, upon Company's Best Knowledge (a) of any
condition or event that
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constitutes an Event of Default or Potential Event of Default, or that
any Lender has given any notice (other than to Administrative Agent) or
taken any other action with respect to a claimed Event of Default or
Potential Event of Default, (b) that any Person has given any notice to
Company or any of its Subsidiaries or taken any other action with
respect to a claimed default or event or condition of the type referred
to in subsection 8.2, (c) of any condition or event that would be
required to be disclosed in a current report filed by Company with the
Securities and Exchange Commission on Form 8-K (Items 1, 2, 4, 5 and 6
of such Form as in effect on the date hereof) if Company were required
to file such reports under the Exchange Act, or (d) of the occurrence
of any event or change that has caused or evidences, either in any case
or in the aggregate, a Material Adverse Effect, an Officers'
Certificate specifying the nature and period of existence of such
condition, event or change, or specifying the notice given or action
taken by any such Person and the nature of such claimed Event of
Default, Potential Event of Default, default, event or condition, and
what action Company has taken, is taking and proposes to take with
respect thereto;
(x) Litigation or Other Proceedings: (a) promptly upon any
Responsible Officer obtaining knowledge of (X) the institution of, or
non-frivolous threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting Company or any of its Subsidiaries or
any property of Company or any of its Subsidiaries (collectively,
"Proceedings") not previously disclosed in writing by Company to
Lenders or (Y) any material development in any Proceeding that, in any
case of (X) or of (Y):
(1) if adversely determined, has a reasonable
possibility of giving rise to a Material Adverse Effect; or
(2) seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as
a result of, the transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Company to enable Lenders and their counsel to
evaluate such matters; and (b) within twenty days after the end of each
Fiscal Quarter of Company, a schedule of all Proceedings involving an
alleged liability of, or claims against or affecting, Company or any of
its Subsidiaries equal to or greater than $10,000,000 in the aggregate,
and promptly after request by Administrative Agent such other
information as may be reasonably requested by Administrative Agent to
enable Administrative Agent and its counsel to evaluate any of such
Proceedings;
(xi) ERISA Events: promptly upon becoming aware of, but in no
case later than 15 calendar days after, the occurrence of or
forthcoming occurrence of
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any ERISA Event, a written notice specifying the nature thereof, what
action Company or any of its ERISA Affiliates has taken, is taking or
proposes to take with respect thereto and, when known, any action taken
or threatened by the Internal Revenue Service, the Department of Labor
or the PBGC with respect thereto;
(xii) ERISA Notices: with reasonable promptness, copies of (a)
each Schedule B (Actuarial Information) to the annual report (Form 5500
Series) as required to be filed by Company or any of its ERISA
Affiliates with the Internal Revenue Service with respect to each
Pension Plan; (b) all notices received by Company or any of its ERISA
Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event;
and (c) such other documents or governmental reports or filings
relating to any Employee Benefit Plan as Administrative Agent shall
reasonably request;
(xiii) Financial Plans: as soon as practicable and in any event
no later than 30 days after the beginning of each Fiscal Year, a
consolidated and Consolidating plan and financial forecast for such
Fiscal Year, including without limitation (a) forecasted consolidated
and Consolidating balance sheet and forecasted consolidated statements
of income and cash flows of Company and its Subsidiaries for such
Fiscal Year, together with a pro forma Compliance Certificate for such
Fiscal Year and an explanation of the assumptions on which such
forecasts are based, (b) forecasted consolidated and Consolidating
statements of income and cash flows of Company and its Subsidiaries for
each Fiscal Quarter of each such Fiscal Year, together with an
explanation of the assumptions on which such forecasts are based, (c)
the amount of forecasted unallocated overhead for each such Fiscal
Year, and (d) such other information and projections as any Lender may
reasonably request;
(xiv) Environmental Audits and Reports: as soon as practicable
following receipt thereof, but in no case later than 15 calendar days
after, copies of all environmental audits and reports, whether prepared
by personnel of Company or any of its Subsidiaries or by independent
consultants, with respect to significant environmental matters at any
Facility or which relate to an Environmental Claim which could result
in a Material Adverse Effect;
(xv) Board of Directors: with reasonable promptness,
written notice of any change in the Board of Directors of Company;
(xvi) Pricing Determination Certificate: concurrently with the
delivery of the financial statements for each Fiscal Quarter required
under subsection 6.1(i) and as soon as practicable and in any event no
later than 90 days after the end of each Fiscal Year, Company shall
deliver a Pricing Determination Certificate;
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(xvii) New Subsidiaries: promptly upon any Person becoming a
Subsidiary of Company, a written notice setting forth with respect to
such Person (a) the date on which such Person became a Subsidiary of
Company and (b) all of the data required to be set forth in Schedule
5.1 annexed hereto with respect to all Subsidiaries of Company (it
being understood that such written notice shall be automatically deemed
to supplement Schedule 5.1 to this Agreement for all purposes,
including the Guaranty);
(xviii) New Venture Status Reports: as soon as available and in
any event within 45 days after the end of each Fiscal Quarter of each
Fiscal Year, a status report detailing the operations and financial
projections for any New Venture involving the proposed Investment by
Company and its Subsidiaries of an amount in excess of $5,000,000;
(xix) Regulation 6.090 Reports: promptly, but in no case later
than 15 calendar days, after the same are available, copies of the
Nevada "Regulation 6.090 Report" and "6-A Report" and copies of any
written communication to Company or any of its Subsidiaries from any
Gaming Board advising it of a violation of or non-compliance with, any
Gaming Law by Company or any of its Subsidiaries;
(xx) US Documented Barges: promptly upon the acquisition or
documentation by Company or any of its Subsidiaries of any additional
US Documented Barge, a written notice setting forth with respect to
such Person (a) the date on which such barge became a US Documented
Barge and (b) all of the data required to be set forth in Schedule 5.5
annexed hereto with respect to all US Documented Barges (it being
understood that such written notice shall be automatically deemed to
supplement Schedule 5.5 to this Agreement for all purposes); and
(xxi) Other Information: with reasonable promptness, such
other information and data with respect to Company or any of its
Subsidiaries as from time to time may be reasonably requested by
any Lender.
6.2 Corporate Existence, etc.
Except as permitted under subsection 7.7, Company will, and
will cause each of its Subsidiaries to, at all times preserve and keep in full
force and effect its corporate or other legal existence, as applicable, and all
rights and franchises material to its business.
6.3 Payment of Taxes and Claims; Tax Consolidation.
A. Company will, and will cause each of its Subsidiaries to, pay all
taxes, assessments and other governmental charges imposed upon it or any of its
properties or
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assets or in respect of any of its income, businesses or franchises before any
penalty accrues thereon, and all claims (including, without limitation, claims
for labor, services, materials and supplies) for sums that have become due and
payable and that by law have or may become a Lien upon any of its properties or
assets, prior to the time when any penalty or fine shall be incurred with
respect thereto; provided that no such tax, charge or claim need be paid if
being contested in good faith by appropriate proceedings promptly instituted and
diligently conducted and if such reserve or other appropriate provision, if any,
as shall be required in conformity with GAAP shall have been made therefor.
B. Company will not, nor will it permit any of its Subsidiaries to,
file or consent to the filing of any consolidated income tax return with any
Person (other than Company or any of its Subsidiaries).
6.4 Maintenance of Properties; Insurance.
A. Company will, and will cause each of its Subsidiaries to, maintain
or cause to be maintained in good repair, working order and condition, ordinary
wear and tear excepted, all material properties used or useful in the business
of Company and its Subsidiaries (including, without limitation, maintenance of
Intellectual Property) and from time to time will make or cause to be made all
appropriate repairs, renewals and replacements thereof.
B. Company will maintain or cause to be maintained, with financially
sound and reputable insurers, throughout the term of this Agreement, all
Policies of Insurance required pursuant to Schedules 6.4(a) and 6.4(b) annexed
hereto and will otherwise comply fully with the terms and conditions provided in
subsection 6 of each of the Mortgages and within each of the Ship Mortgages
under the heading "Vessel Insurance Requirements and Provisions". Each such
policy of insurance shall name Administrative Agent for the benefit of Lenders
as the loss payee thereunder for amounts in excess of $2,500,000 and shall
provide for at least 30 days prior written notice to Administrative Agent of any
modification or cancellation of such policy.
6.5 Inspection; Lender Meeting.
Company shall, and shall cause each of its Subsidiaries to,
permit any authorized representatives designated by any Lender to visit and
inspect any of the properties of Company or any of its Subsidiaries, including
its and their financial and accounting records, and to make copies and take
extracts therefrom, and to discuss its and their affairs, finances and accounts
with its and their officers and independent public accountants (provided that
Company may, if it so chooses, be present at or participate in any such
discussion), all upon reasonable notice and at such reasonable times during
normal business hours and as often as may be reasonably requested. Without in
any way limiting the foregoing, Company will, upon the request of Managing
Agents or Requisite Lenders, participate in a meeting of Managing Agents and
Lenders once during each
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Fiscal Year to be held at Company's corporate offices (or such other location as
may be agreed to by Company and Managing Agents) at such time as may be agreed
to by Company and Managing Agents.
6.6 Compliance with Laws, etc.
Company shall, and shall cause each of its Subsidiaries to,
comply with the requirements of all applicable laws, rules, regulations and
orders of any Governmental Authority, including all Gaming Laws, and to obtain
and keep in full force and effect any permit, license, consent, or approval
required under this Agreement if such noncompliance or failure to obtain and
keep in full force and effect could reasonably be expected to cause a Material
Adverse Effect. Company shall and shall cause each of its Subsidiaries to comply
with the requirements of all Gaming Laws applicable to such Person.
6.7 Environmental Disclosure and Inspection.
A. Company shall, and shall cause each of its Subsidiaries to, exercise
all due diligence in order to comply and use its best efforts to cause (i) all
tenants under any leases or occupancy agreements affecting any portion of the
Facilities and (ii) all other Persons on or occupying such property, to comply
with all Environmental Laws.
B. Company agrees that Administrative Agent may, once during each
Fiscal Year until the Commitment Termination Date or at any time upon the
occurrence of an Event of Default, retain, at Company's expense, an independent
professional consultant to review any report relating to Hazardous Materials
prepared by or for Company and to conduct its own investigation of any Facility
currently owned, leased, operated or used by Company or any of its Subsidiaries,
and Company agrees to use its best efforts to obtain permission for
Administrative Agent's professional consultant to conduct its own investigation
of any Facility previously owned, leased, operated or used by Company or any of
its Subsidiaries. Company hereby grants to Administrative Agent and its agents,
employees, consultants and contractors the right to enter into or on to the
Facilities currently owned, leased, operated or used by Company or any of its
Subsidiaries to perform such tests on such property as are reasonably necessary
to conduct such a review and/or investigation. Any such investigation of any
Facility shall be conducted, unless otherwise agreed to by Company and
Administrative Agent, during normal business hours and, to the extent reasonably
practicable, shall be conducted so as not to interfere with the ongoing
operations at any such Facility or to cause any damage or loss to any property
at such Facility. Company and Administrative Agent hereby acknowledge and agree
that any report of any investigation conducted at the request of Administrative
Agent pursuant to this subsection 6.7B will be obtained and shall be used by
Administrative Agent and Lenders solely for the purposes of Lenders' internal
credit decisions, to monitor and police the Loans and to protect Lenders'
security interests, if any, created by the Loan Documents. Administrative Agent
agrees to deliver a copy of any such report to Company with the understanding
that Company acknowledges and
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agrees that (i) it will hold harmless Administrative Agent and each Lender from
any costs, losses or liabilities relating to Company's use of or reliance on
such report, (ii) neither Administrative Agent nor any Lender makes any
representation or warranty with respect to such report, and (iii) by delivering
such report to Company, neither Administrative Agent nor any Lender is requiring
or recommending the implementation of any suggestions or recommendations
contained in such report.
C. Company shall promptly advise Lenders in writing and in reasonable
detail of (i) any Release of any Hazardous Materials required to be reported to
any federal, state or local governmental or regulatory agency under any
applicable Environmental Laws, (ii) any and all written communications with
respect to any Environmental Claims that have a reasonable possibility of giving
rise to a Material Adverse Effect or with respect to any Release of Hazardous
Materials required to be reported to any federal, state or local governmental or
regulatory agency, (iii) any remedial action taken by Company or any other
Person in response to (x) any Hazardous Materials on, under or about any
Facility, the existence of which has a reasonable possibility of resulting in an
Environmental Claim having a Material Adverse Effect, or (y) any Environmental
Claim that could have a Material Adverse Effect, (iv) discovery by any
Responsible Officer of any occurrence or condition on any real property
adjoining or in the vicinity of any Facility that could cause such Facility or
any part thereof to be subject to any restrictions on the ownership, occupancy,
transferability or use thereof under any Environmental Laws, and (v) any request
for information from any governmental agency that suggests such agency is
investigating whether Company or any of its Subsidiaries may be potentially
responsible for a Release of Hazardous Materials.
D. Company shall promptly notify Lenders of (i) any proposed
acquisition of stock, assets, or property by Company or any of its Subsidiaries
that could reasonably be expected to expose Company or any of its Subsidiaries
to, or result in, Environmental Claims that could have a Material Adverse Effect
or that could reasonably be expected to have a material adverse effect on any
Governmental Authorization then held by Company or any of its Subsidiaries and
(ii) any proposed action to be taken by Company or any of its Subsidiaries to
commence manufacturing, industrial or other operations that could reasonably be
expected to subject Company or any of its Subsidiaries to additional laws, rules
or regulations, including, without limitation, laws, rules and regulations
requiring additional environmental permits or licenses.
E. Company shall, at its own expense, provide copies of such documents
or information as Administrative Agent may reasonably request in relation to any
matters disclosed pursuant to this subsection 6.7.
6.8 Company's Remedial Action Regarding Hazardous Materials.
Company shall promptly take, and shall cause each of its
Subsidiaries promptly to take, any and all necessary remedial action in
connection with the presence, storage, use, disposal, transportation or Release
of any Hazardous Materials on, under or
95
about any Facility in order to comply with all applicable Environmental Laws and
Governmental Authorizations. In the event Company or any of its Subsidiaries
undertakes any remedial action with respect to any Hazardous Materials on, under
or about any Facility, Company or such Subsidiary shall conduct and complete
such remedial action in compliance with all applicable Environmental Laws, and
in accordance with the policies, orders and directives of all federal, state and
local governmental authorities except when, and only to the extent that,
Company's or such Subsidiary's liability for such presence, storage, use,
disposal, transportation or discharge of any Hazardous Materials is being
contested in good faith by Company or such Subsidiary.
6.9 Post-Closing Matters.
Company shall, and shall cause its Subsidiaries to, take such
actions as are necessary to satisfy each of the post-closing conditions set
forth in Schedule 6.9 annexed hereto, in each case in the manner and within the
time frames specified in Schedule 6.9 annexed hereto.
6.10 New Subsidiaries; New Joint Ventures; Further Assurances.
A. In the event a Person becomes a Subsidiary of Company after the
Closing Date, Company, upon the request of Administrative Agent, shall and shall
cause such Subsidiary to execute and deliver such guaranties, collateral
documents and such other agreements, pledges, assignments, documents and
certificates (including, without limitation, any amendments to the Loan
Documents) as may be necessary or desirable or as Administrative Agent may
request and do such other acts and things as Administrative Agent reasonably may
request in order to have a lien on the stock of such Subsidiary and to have such
Subsidiary guaranty and/or secure the Obligations and effect fully the purposes
of this Agreement and the other Loan Documents and to provide for payment of the
Obligations in accordance with the terms of this Agreement and the other Loan
Documents; provided that the provisions of this subsection 6.10A shall not apply
to any such Subsidiary during such time that such Subsidiary is an Excluded
Subsidiary.
B. In the event Company or any of its Subsidiaries enters into any
Joint Venture by means of the ownership of any Subsidiary (a "Participant
Subsidiary") that, directly or indirectly, holds stock in a Joint Venture in
corporate form or acts as a partner in a Joint Venture in partnership form, (i)
Company shall, and shall cause each of its Subsidiaries to, pledge its interests
in such Participant Subsidiary that enters into such Joint Venture as
Collateral, (ii) neither Company nor any of its Subsidiaries shall enter into
any other agreement that creates any Lien on the interests that Company or any
such Subsidiary owns in such Participant Subsidiary or Joint Venture and (iii)
neither Company nor any of its Subsidiaries will enter into any agreement that
prohibits, restricts or conditions Lenders' rights to encumber the stock or
ownership interests in such Participant Subsidiary or Joint Venture.
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C. Additionally, Company shall, and shall cause each of its
Subsidiaries to, execute such documents as Administrative Agent reasonably may
request to perfect Administrative Agent's Lien on real or personal property
located at any of the Facilities acquired after the Closing Date, including,
without limitation, the Lake ▇▇▇▇▇▇▇ Star Riverboat, Company's interests in the
partnership that owns such riverboat casino, the real property and improvements
thereon acquired as part of the Lake ▇▇▇▇▇▇▇ Complex Expansion (as described on
pages 27 and 28 of the Memorandum) and any US Documented Barges to be located at
or on any of the Facilities. Company shall give Administrative Agent notice of
the acquisition by it or any of its Subsidiaries of any individual piece of real
or personal property to be located or used at any of the Facilities and having a
value in excess of $1,000,000 within 30 days of such acquisition.
D. Notwithstanding the generality of subsection 6.10C:
(i) If, and at such time as, SIRCC or any Affiliate of Borrower
purchases any of the parking lots used in connection with the Illinois
Facilities from Burlington Northern Railroad Company (the "Railroad"),
which parking lots SIRCC currently leases from the Railroad, Borrower
shall cause SIRCC or such Affiliate purchasing such parking lot (i) to
grant to Administrative Agent a deed of trust or mortgage, in form and
substance acceptable to Administrative Agent, on such parking lot(s),
(ii) to pay or cause to be paid any monetary Liens then encumbering
such parking lot(s), (iii) to provide Administrative Agent with a
lender's policy of title insurance and any endorsements thereto, in
form and substance acceptable to Administrative Agent (but, subject to
such non-monetary Liens as do not materially affect the use and
operation of such parking lot), insuring such deed of trust or mortgage
as a first priority Lien on such parking lot in favor of Administrative
Agent, and (iv) to execute and deliver such other instruments and
agreements and undertake such other acts as Administrative Agent may
request in connection therewith (including, without limitation,
executing security agreements, fixture filings, and financing
statements with respect to such parking lots); and
(ii) Unless, prior to the Closing Date, PLC shall have purchased the
fee estate in the portion of the Louisiana Premises leased pursuant to
that Lease, dated as of May 18, 1993 (as amended, the "▇▇▇▇▇▇ Lease"),
between The ▇▇▇▇▇▇ Corporation, as landlord, and PLC, as tenant (such
portion of the Louisiana Premises being referred to herein as the
"▇▇▇▇▇▇ Property"), Borrower, at such time as PLC or any Affiliate of
Borrower purchases such fee estate (such purchaser being referred to
herein as the "Purchaser"), shall cause the Purchaser (i) to grant to
Administrative Agent a deed of trust or mortgage on the fee estate in
the ▇▇▇▇▇▇ Property acquired by the Purchaser, in form and substance
acceptable to Administrative Agent, (ii) to pay or cause to be paid any
monetary Liens then encumbering the ▇▇▇▇▇▇ Property, (iii) to provide
to Administrative Agent a lender's policy of title insurance and any
endorsements thereto, in form and substance acceptable to
Administrative Agent (but, subject to such non-
97
monetary Liens as do not materially affect the use and operation of the
▇▇▇▇▇▇ Property), insuring such deed of trust or mortgage as a first
priority Lien on such property in favor of Administrative Agent, and
(iv) to execute and deliver such other instruments and agreements and
undertake such other acts as Administrative Agent may request in
connection therewith (including, without limitation, executing security
agreements, fixture filings, and financing statements with respect to
the ▇▇▇▇▇▇ Property).
E. Company, Administrative Agent and each of the Lenders will, at the
expense of Company, do, execute, acknowledge and deliver, or cause to be done,
executed, acknowledged and delivered, such amendments or supplements hereto or
to any of the Loan Documents and such further documents, instruments and
transfers as any such party may reasonably require for the curing of any defect
in the execution or acknowledgment hereof or in any of the Loan Documents, or in
the description of the real property or other Collateral or for the proper
evidencing of giving notice of each Lien or security interest securing repayment
of the Obligations. Further, upon the execution and delivery of the Mortgages,
the Ship Mortgages and each of the Loan Documents and thereafter, from time to
time, Company shall cause the Mortgages, the Ship Mortgages and each of the Loan
Documents and each amendment and supplement thereto to be filed, registered and
recorded and to be refiled, re-registered and re- recorded in such manner and in
such places as may be reasonably required by Requisite Lenders or Administrative
Agent, in order to publish notice of and fully protect the Liens of the
Mortgages, the Ship Mortgages and each of the Loan Documents in the Collateral
and to perform or cause to be performed from time to time any other actions
required by law and execute or cause to be executed any and all instruments of
further assurance that may be necessary for such publication, perfection,
continuation and protection.
F. Company shall give Administrative Agent written notice promptly upon
entering into contracts after the Closing Date other than the Excluded Contracts
(as defined below) aggregating more than $10,000,000 with respect to the
construction or renovation of Improvements or any other contracts aggregating
more than $10,000,000 that might give rise to mechanics or other statutory Liens
at any one of the following locations (a) the Illinois Premises, (b) the
Louisiana Premises, (c) the portion of the Nevada Premises insured by Title
Policy #______ issued by Chicago Title Insurance Company or (d) the portion of
the Nevada Premises insured by Title Policy #_____ issued by Chicago Title
Insurance Company, which notice shall include the location at which such
construction or renovation is taking place and a brief description of the nature
of the construction or renovation. Administrative Agent shall promptly transmit
such notice to Lenders and, upon receipt of written requests therefor from
Requisite Lenders, shall request Title Company to issue at Company's expense a
California Land Title Association Form 122 (or comparable) endorsement to the
Title Policy issued at the closing of this Agreement with respect to the
location at which such construction or renovation is being conducted, which
endorsement shall provide insurance against any mechanics or other statutory
liens arising from such construction or renovation; provided
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that Requisite Lenders may request such an endorsement be issued no more often
than quarterly during the period from the date of receipt of such notice from
Company until such date as all of the following have occurred (x) a certificate
of use or occupancy (or comparable certificate in the applicable jurisdiction)
has been issued with respect to such construction or renovation, (y) any
statutory period within which a mechanics Lien could be asserted has expired and
(z) all contractors with respect to such construction or renovation have been
paid in full. Company agrees to cooperate with the Title Company to cause such
endorsements to be issued. For purposes of this Section 6.01C Excluded Contracts
shall mean contracts with respect to which the Title Policies delivered on the
Closing Date provided endorsements as to the absence of mechanics or other
statutory Liens arising in connection with the performance thereof.
G. Upon each exercise of the option in the Waterbottom Lease
(as defined in the Louisiana Mortgage) that permits PLC to lease additional
waterbottom lands from the State of Louisiana, Players shall record, or shall
cause PLC to record, in the land records of Calcasieu Parish, Louisiana, a
memorandum of exercise of option for purposes of putting of record PLC's rights
in such additional lands. Concurrently therewith, Players shall notify the
Administrative Agent in writing and shall execute, deliver, and record any
instruments and agreements and do such other acts as the Administrative Agent
may deem necessary or appropriate to insure the senior priority of the lien of
the Louisiana Mortgage over such additional lands (including, without
limitation, causing the Title Company to issue, at Company's sole cost and
expense, an endorsement to the applicable Title Policy ensuring the senior
priority of the lien of the Louisiana Mortgage on PLC's rights in such
additional lands).
H. At such time as the lessor under the golf course lease that
consists of a portion of the Nevada Facilities acquires title to that certain
real property designated as "Government Lot 2" under Section 31 of such lease,
Players shall notify, or shall cause PMGC, to notify the Administrative Agent,
and Players and PMGC shall execute, deliver, and record any instruments and
agreements and do such other acts as the Administrative Agent may deem necessary
or appropriate to insure the senior priority of the lien of the applicable
Nevada Mortgage over such additional real property (including, without
limitation, causing the Title Company to issue, at Company's sole cost and
expense, an endorsement to the applicable Title Policy ensuring the senior
priority of the lien of the Nevada Mortgage on PMGC's rights in such additional
real property).
Section 7. COMPANY'S NEGATIVE COVENANTS
Company covenants and agrees that, so long as the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders shall otherwise give prior written consent,
Company shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 7.
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7.1 Indebtedness.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, create, incur, assume or guaranty, or otherwise
become or remain directly or indirectly liable with respect to, any
Indebtedness, except (i) the Loans, (ii) the Senior Notes and (iii) so long as
no Event of Default or, to Company's Best Knowledge, Potential Event of Default
shall have occurred and be continuing, or shall be caused thereby, (A) Other
Allowed Indebtedness (Secured) and (B) Company and its Subsidiaries may create,
incur, assume or guaranty or otherwise become or remain liable directly or
indirectly liable with respect to Other Allowed Indebtedness (Unsecured) if,
after giving effect thereto, Company shall be in compliance on a pro forma basis
with the Adjusted Leverage Ratio then applicable pursuant to subsection 7.6C;
provided that the aggregate Indebtedness of Company and its Subsidiaries
outstanding at any time under clauses (i), (ii) and (iii) above shall not exceed
$275,000,000.
7.2 Liens and Related Matters.
A. Prohibition on Liens. Company shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any of their respective assets, whether now
owned or hereafter acquired, or any income or profits therefrom, or file or
permit the filing of, or permit to remain in effect, any financing statement or
other similar notice of any Lien with respect to any of the Collateral under the
Uniform Commercial Code of any State or under any similar recording or notice
statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted or permitted pursuant to the Collateral
Documents;
(iii) Liens to secure Other Allowed Indebtedness (Secured) to
the extent permitted pursuant to the definitions of "Other Allowed
Indebtedness (Secured)" and "Purchase Money Debt";
(iv) Liens existing on the Closing Date and described on
Schedule 7.2 annexed hereto; and
(v) a Lien to be granted by PMH and/or PMHLP, as lessee, on
certain of its gaming equipment and gaming receivables, in favor of the
Riverside Joint Venture, as landlord, to secure the payment by PMH of
certain lease obligations owed to the Riverside Joint Venture in
connection with the operation of the Maryland Heights Facility.
B. No Further Negative Pledges. Except with respect to specific
property encumbered pursuant to subsection 7.2A or to be sold pursuant to an
executed agreement with respect to an Asset Sale, neither Company nor any of its
Subsidiaries
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shall enter into any agreement prohibiting the creation or assumption of any
Lien upon any of its properties or assets, whether now owned or hereafter
acquired.
C. No Restrictions on Subsidiary Distributions to Company or Other
Subsidiaries. Except as provided herein, Company will not, and will not permit
any of its Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on any of such Subsidiary's capital stock owned by Company or any
other Subsidiary of Company, (ii) repay or prepay any Indebtedness owed by such
Subsidiary to Company or any other Subsidiary of Company, (iii) make loans or
advances to Company or any other Subsidiary of Company, or (iv) transfer any of
its property or assets to Company or any other Subsidiary of Company.
7.3 Investments, Loans and Advances; Joint Ventures.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, make or own any Investment or make any capital
expenditure (including, without limitation, any New Venture Investments) in any
Person, including any Joint Venture, except:
(i) Company and its Subsidiaries may make and own Investments
in Cash Equivalents;
(ii) Company and its Subsidiaries may make intercompany loans
to the extent permitted under subsection 7.1; provided that the
obligations under any such loans are subordinated to the Obligations of
Company or any such Subsidiary under the Loans or the Guaranty, as the
case may be;
(iii) Company and its Subsidiaries may continue to own the
Investments owned by them and described in Schedule 7.3 annexed hereto;
(iv) Company and its Subsidiaries may make Investments in any
New Venture if the amount of any such Investment in a New Venture does
not exceed either (a) $75,000,000, if Consolidated EBIDTA for the
relevant Investment Measurement Period does not exceed $75,000,000 or
(b) $100,000,000, if Consolidated EBIDTA for such period exceeds
$75,000,000; provided that prior to any Investment by Company or any of
its Subsidiaries in a New Venture that exceeds $5,000,000, Company
shall deliver to Lenders (x) a budget for such New Venture describing
in detail the scope of development activities related to such New
Venture and the itemized amounts to be expended thereon and (y) an
Officers' Certificate demonstrating compliance with clause (a) or (b)
of this subsection 7.3(iv), as applicable; and
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(v) Company and its Subsidiaries may make additional
Investments not to exceed $500,000 on an individual basis or
$1,000,000 in the aggregate.
7.4 Contingent Obligations.
Company shall not, and shall not permit any of its Subsidiaries
to, without the prior written consent of Administrative Agent and Requisite
Lenders, directly or indirectly, create or become or remain liable with respect
to any Contingent Obligation, except:
(i) Company and such Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of any Indebtedness
of Company or any of its Subsidiaries permitted by subsection 7.1;
(ii) Company and such Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of Letters of Credit;
and
(iii) Company and such Subsidiaries may become and remain
liable for Contingent Obligations to make Investments permitted by
subsection 7.3.
7.5 Restricted Payments.
Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, declare, order, pay, make or set apart any sum for
any Restricted Payment, except Company may make open-market or private purchases
of its outstanding equity securities (or options or warrants to purchase such
securities) if the aggregate amount to be paid does not exceed $25,000,000 plus
twenty percent (20%) of the sum of Consolidated Net Income for each Fiscal
Quarter ending after the Closing Date and prior to the making of the applicable
Restricted Payment minus all amounts previously paid since the Closing Date for
purchases of such equity securities, options or warrants; provided that nothing
contained in this restriction shall limit Company's ability to repurchase Senior
Notes pursuant to a Regulatory Redemption (as defined in the Indenture).
7.6 Financial Covenants.
A. Minimum Fixed Charge Coverage Ratio. Company shall not permit
the Fixed Charge Coverage Ratio on the last day of each Fiscal Quarter occurring
in a period set forth below to be less than the amount set forth opposite such
period:
Period Amount
------ ------
July 1, 1995 to June 30, 1996 1.50:1.00
July 1, 1996 to June 30, 1997 1.60:1.00
July 1, 1997 and thereafter 1.75:1.00
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B. Minimum Consolidated EBIDTA. Company shall not permit Consolidated
EBIDTA for the four consecutive Fiscal Quarters ending on the last day of each
Fiscal Quarter occurring in the period set forth below to be less than the
amount set forth opposite such period:
Period Amount
------ ------
July 1, 1995 to June 30, 1996 $55,000,000
July 1, 1996 to June 30, 1997 $65,000,000
July 1, 1997 and thereafter $75,000,000
C. Maximum Adjusted Leverage Ratio. Company shall not permit the
Adjusted Leverage Ratio on the last day of each Fiscal Quarter occurring in the
period set forth below to be more than the amount set forth opposite such
period:
Period Amount
------ ------
July 1, 1995 to June 30, 1996 2.50:1.00
July 1, 1996 to June 30, 1997 2.25:1.00
July 1, 1997 and thereafter 2.00:1.00
D. Minimum Consolidated Tangible Net Worth. Company shall not permit
Consolidated Tangible Net Worth on the last day of each Fiscal Quarter to be
less than $132,600,000 plus seventy-five percent (75%) of Consolidated Net
Income earned after the Closing Date (but not net losses) plus fifty percent
(50%) of the net proceeds of any equity offering by Company completed subsequent
to the Closing Date less the aggregate amount expended by Company in connection
with repurchases of its equity securities.
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions.
Company shall not, and shall not permit any of its
Subsidiaries to, alter the corporate, capital or legal structure of Company or
any of its Subsidiaries, or enter into any transaction of merger or
consolidation, or liquidate, wind-up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease, sub-lease, transfer or
otherwise dispose of, in one transaction or a series of transactions, all or any
substantial part of its business, property or fixed assets, whether now owned or
hereafter acquired, or acquire by purchase or otherwise 50% or more of the
business, property or fixed assets of, or stock or other evidence of beneficial
ownership of, any Person or any division or line of business of any Person,
except:
(i) any Subsidiary of Company (other than a Guarantor) may be
merged with or into Company or any wholly-owned Subsidiary of Company,
or be liquidated, wound up or dissolved, or all or any part of its
business, property or
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assets may be conveyed, sold, leased, transferred or otherwise disposed
of, in one transaction or a series of transactions, to Company or any
wholly-owned Subsidiary of Company; provided that, in the case of such
a merger, Company or such wholly-owned Subsidiary shall be the
continuing or surviving corporation; provided further if any Guarantor
or grantor under a Collateral Document is the disappearing entity in a
merger with a wholly-owned Subsidiary that is not a Guarantor or
grantor, the surviving corporation shall execute a Guaranty and/or a
Subsidiary Security Agreement, as the case may be;
(ii) any Subsidiary of Company may change its legal structure
so long as (X) any such modification does not in any manner impair any
Lender's ability to realize the Collateral owned by such Subsidiary
upon an Event of Default and (Y) if such Subsidiary is the disappearing
entity in a merger devised to effect such a structural change, the
surviving entity shall execute a Guaranty and/or a Subsidiary Security
Agreement, as the case may be;
(iii) subject to subsections 7.11 and 2.4A(ii), Company and
its Subsidiaries may make Asset Sales of assets having a fair market
value not in excess of $5,000,000 on an individual basis; provided
that, with respect to the sale of any asset having a fair market value
equal to or exceeding $2,500,000, (x) the consideration received for
such assets shall be in an amount at least equal to the fair market
value thereof and (y) at least eighty percent (80%) of the considera-
tion received shall be Cash;
(iv) Company and its Subsidiaries may make acquisitions of
Securities issued by Company consistent with subsection 7.5; and
(v) RBI may convey real property to PMH or PMHLP or the
Riverside Joint Venture in connection with the operation of the
Maryland Heights Facility.
7.8 Transactions with Shareholders and Affiliates.
Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service) the subject matter of
which involves an amount in excess of $1,000,000 with any holder of 5% or more
of any class of equity Securities of Company or with any Affiliate of Company or
of any such holder, on terms that are less favorable to Company or that
Subsidiary, as the case may be, than those that might be obtained at the time
from Persons who are not such a holder or Affiliate; provided that nothing
contained in the foregoing restriction shall apply to (i) any transaction
between Company and any of its wholly-owned Subsidiaries or between any of its
wholly-owned Subsidiaries or (ii) reasonable and customary fees paid to members
of the Boards of Directors of Company and its Subsidiaries.
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7.9 Disposal of Subsidiary Stock.
Company shall not:
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other equity
Securities of any of its Subsidiaries, except to qualify directors if
required by applicable law; or
(ii) permit any of its Subsidiaries directly or indirectly to
sell, assign, pledge or otherwise encumber or dispose of any shares of
capital stock or other equity Securities of any of its Subsidiaries
(including such Subsidiary), except to Company, another Subsidiary of
Company, or to qualify directors if required by applicable law.
7.10 Conduct of Business.
From and after the Closing Date, Company shall not, and shall
not permit any of its Subsidiaries to, engage in any business other than (i) the
businesses engaged in by Company and its Subsidiaries on the Closing Date as
described in the Memorandum and any Related Business and (ii) such other lines
of business as may be consented to by Requisite Lenders.
7.11 Tradenames, Trademarks and Servicemarks.
Company and its Subsidiaries shall not assign or in any other
manner alienate its interest in any tradenames, trademarks or servicemarks
relating or pertaining to any of the Facilities other than (i) as provided on
Schedule 7.11 or (ii) assignments in the ordinary course of Company's business
and similar in nature to the types of assignments undertaken by comparable
gaming entities.
7.12 Change of Control Offer.
Company shall not commence a Change of Control Offer (as
defined in the Indenture) without the consent of Requisite Lenders.
7.13 No Amendment of Indenture.
Company shall not amend the Indenture in any manner without
the prior written consent of Requisite Lenders, which consent shall not be
unreasonably withheld; provided that nothing contained in this restriction shall
apply to any amendment to the Indenture that either (i) does not require the
consent of any holder of Senior Notes or (ii) is required by a final order or
decree of a court of competent jurisdiction.
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7.14 No Movement of Other Barges.
Company and its Subsidiaries shall not permit any Other Barge
to be moved from permanent moorage at the Louisiana Premises or the Illinois
Premises, as applicable, unless and until (i) such Barge is registered with the
United States Coast Guard so as to become a US Documented Barge and (ii) a first
priority Lien has been created for the benefit of the Lenders pursuant to a duly
authorized, executed and delivered Ship Mortgage.
Section 8. EVENTS OF DEFAULT
IF any of the following conditions or events ("Events of
Default") shall occur:
8.1 Failure to Make Payments When Due.
Failure by Company to pay (i) any installment of principal of
or interest on any Loan when due, whether at stated maturity, by acceleration,
by notice of voluntary prepayment, by mandatory prepayment or otherwise; (ii)
when due any amount payable to Administrative Agent in reimbursement of any
drawing under a Letter of Credit; or (iii) any interest on any Loan or any fee
or any other amount due under this Agreement within five days after the date
due; or
8.2 Default in Other Agreements.
(i) Failure of Company or any of its Subsidiaries to pay when
due (a) any principal of or interest on any Indebtedness (other than
Indebtedness referred to in subsection 8.1) in an individual principal amount of
$2,500,000 or more or any items of Indebtedness with an aggregate principal
amount of $5,000,000 or more or (b) any Contingent Obligation in an individual
principal amount of $2,500,000 or more or any Contingent Obligations with an
aggregate principal amount of $5,000,000 or more, in each case beyond the end of
any grace period provided therefor; or (ii) breach or default by Company or any
of its Subsidiaries with respect to any other material term of (a) any evidence
of any Indebtedness in an individual principal amount of $2,500,000 or more or
any items of Indebtedness with an aggregate principal amount of $5,000,000 or
more or any Contingent Obligation in an individual principal amount of
$2,500,000 or more or any Contingent Obligations with an aggregate principal
amount of $5,000,000 or more or (b) any loan agreement, mortgage, indenture or
other agreement relating to such Indebtedness or Contingent Obligation(s), if
the effect of such breach or default is to cause, or to permit the holder or
holders of that Indebtedness or Contingent Obligation(s) (or a trustee on behalf
of such holder or holders) to cause, that Indebtedness or Contingent
Obligation(s) to become or be declared due and payable prior to its stated
maturity or the stated maturity of any underlying obligation, as the case may be
(upon the giving or receiving of notice, lapse of time, both, or otherwise); or
106
8.3 Breach of Certain Covenants.
Failure of Company to perform or comply with any term or
condition contained in subsection 2.4A(ii),2.5, 6.1(ix)(a), 6.2, 6.4B or Section
7 of this Agreement; or
8.4 Breach of Warranty.
Any representation, warranty, certification or other statement
made or deemed made by Company or any of its Subsidiaries in any Loan Document
or in any statement or certificate at any time given by Company or any of its
Subsidiaries in writing pursuant hereto or thereto or in connection herewith or
therewith shall be false in any material respect on the date as of which made;
or
8.5 Other Defaults Under Loan Documents.
Company or any of its Subsidiaries shall default in the
performance of or compliance with any term contained in this Agreement or any of
the other Loan Documents, other than any such term referred to in any other
subsection of this Section 8, and such default shall not have been remedied or
waived within 15 days after the earlier of (i) a Responsible Officer becoming
aware of such default or (ii) receipt by Company of notice from Administrative
Agent or any Lender of such default; or
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A court having jurisdiction in the premises shall enter a
decree or order for relief in respect of Company or any of its Subsidiaries in
an involuntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, which decree
or order is not stayed; or any other similar relief shall be granted under any
applicable federal or state law; or (ii) an involuntary case shall be commenced
against Company or any of its Subsidiaries under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over Company or any of its Subsidiaries, or
over all or a substantial part of its property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee or other custodian of Company or any of its Subsidiaries for all or a
substantial part of its property; or a warrant of attachment, execution or
similar process shall have been issued against any substantial part of the
property of Company or any of its Subsidiaries, and any such event described in
this clause (ii) shall continue for 45 days unless dismissed, bonded, discharged
or stayed; or
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8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Company or any of its Subsidiaries shall have an order for
relief entered with respect to it or commence a voluntary case under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect, or shall consent to the entry of an order for
relief in an involuntary case, or to the conversion of an involuntary case to a
voluntary case, under any such law, or shall consent to the appointment of or
taking possession by a receiver, trustee or other custodian for all or a
substantial part of its property; or Company or any of its Subsidiaries shall
make any assignment for the benefit of creditors; or (ii) Company or any of its
Subsidiaries shall be unable, or shall fail generally, or shall admit in writing
its inability, to pay its debts as such debts become due; or the Board of
Directors of Company or any of its Subsidiaries (or any committee thereof) shall
adopt any resolution or otherwise authorize any action to approve any of the
actions referred to in clause (i) above or this clause (ii); or
8.8 Judgments and Attachments.
Any money judgment, writ or warrant of attachment or similar
process involving (i) in any individual case an amount in excess of $2,500,000
or (ii) in the aggregate at any time an amount in excess of $5,000,000 (in
either case not adequately covered by insurance as to which an unaffiliated
insurance company has acknowledged coverage) shall be entered or filed against
Company or any of its Subsidiaries or any of their respective assets and shall
remain undischarged, unvacated, unbonded or unstayed for a period of 45 days (or
in any event later than five days prior to the date of any proposed sale
thereunder); or
8.9 Dissolution.
Any order, judgment or decree shall be entered against Company
or any of its Subsidiaries decreeing the dissolution or split up of Company or
that Subsidiary and such order shall remain undischarged or unstayed for a
period in excess of 30 days; or
8.10 Employee Benefit Plans.
A. There shall occur one or more ERISA Events which individually or in
the aggregate results in or might reasonably be expected to result in liability
of Company or any of its Subsidiaries or any of their respective ERISA
Affiliates in excess of $5,000,000 during the term of this Agreement.
B. There shall exist an amount of unfunded benefit liabilities (as
defined in Section 4001(a)(18) of ERISA), individually or in the aggregate for
all Pension Plans (excluding for purposes of such computation any Pension Plans
with respect to which assets exceed benefit liabilities), which exceeds
$5,000,000, and such default shall not have been remedied or waived within 10
days after the earlier of (i) the date that, to
108
Company's Best Knowledge, such condition exists or (ii) receipt by Company of
notice from Administrative Agent or any Lender of such default; or
8.11 Change in Control.
A Change of Control shall have occurred; or
8.12 Impairment of Collateral.
(A) A judgment creditor of Company or any of its Subsidiaries
shall obtain possession of any material portion of the Collateral under the
Collateral Documents by any means, including, without limitation, levy,
distraint, replevin or self-help, (B) any substantial portion of the Collateral
shall be taken by eminent domain or condemnation, (C) any of the Collateral
Documents shall cease for any reason (other than an act by Administrative Agent
or any Lender) to be in full force and effect, or any party thereto shall
purport to disavow its obligations thereunder or shall declare that it does not
have any further obligations thereunder or shall contest the validity or
enforceability thereof or Lenders shall cease to have a valid and perfected
first priority security interest in any material Collateral therein, or (D)
Lenders' security interests or liens on any material portion of the Collateral
under the Collateral Documents shall become otherwise impaired or unenforceable;
or
8.13 Loss of Gaming License.
The occurrence of a License Revocation by any Gaming Authority
in a jurisdiction in which Company or any of its Subsidiaries owns or operates a
casino, hotel, casino/hotel, resort, casino/resort, riverboat casino, dock
casino, any other type of casino, golf course, entertainment center or similar
facility; provided that such License Revocation continues for at least five (5)
calendar days; or
8.14 Invalidity of Guaranty.
The Guaranty, for any reason, other than the satisfaction in
full of all Obligations, the termination of this Agreement or the termination of
the Guaranty (or any Guarantor's obligations thereunder) in accordance with its
terms, ceases to be in full force and effect or is declared to be null and void
by final order of a court of competent jurisdiction, or any Guarantor denies
that it has any further liability under the Guaranty or claims that the Guaranty
is void or has no force or effect in whole or in part or gives notice to such
effect; or
8.15 Material Adverse Change.
The occurrence of an event or change that causes or evidences,
either in any case or in the aggregate, a Material Adverse Effect.
109
THEN
8.16 Remedies.
At any time, (i) upon the occurrence of any Event of Default
described in subsection 8.6 or 8.7, each of (a) the unpaid principal amount of
and accrued interest on the Loans, (b) an amount equal to the maximum amount
that may at any time be drawn under all Letters of Credit then outstanding
(whether or not any beneficiary under any such Letter of Credit shall have
presented, or shall be entitled at such time to present, the drafts or other
documents or certificates required to draw under such Letter of Credit), and (c)
all other Obligations shall automatically become immediately due and payable,
without presentment, demand, protest or other requirements of any kind, all of
which are hereby expressly waived by Company, and the obligation of each Lender
to make any Loan and the obligation of Administrative Agent to issue any Letter
of Credit shall thereupon terminate, and (ii) upon the occurrence and during the
continuation of any other Event of Default, Administrative Agent shall, upon the
written request or with the written consent of Requisite Lenders, by written
notice to Company, declare all or any portion of the amounts described in
clauses (a) through (c) above to be, and the same shall forthwith become,
immediately due and payable, and the obligation of each Lender to make any Loan
shall thereupon terminate and the obligation of Administrative Agent to issue
any Letter of Credit hereunder shall thereupon terminate; provided, however,
that the foregoing shall not affect in any way the obligations of Lenders under
subsection 3.3C(i) or the obligations of Lenders to purchase participations in
any unpaid Swing Line Loans as provided in subsection 2.1B.
Any amounts described in clause (b) above, when received by
Administrative Agent, shall be held by Administrative Agent pursuant to the
terms of the Collateral Account Agreement and shall be applied as therein
provided.
Notwithstanding anything contained in the second preceding
paragraph, if at any time within 60 days after an acceleration of the Loans
pursuant to such paragraph Company shall pay all arrears of interest and all
payments on account of principal which shall have become due otherwise than as a
result of such acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Potential Events of Default (other than
non-payment of the principal of and accrued interest on the Loans, in each case
which is due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to subsection 10.6, then Requisite Lenders, by written notice to
Company, may at their option rescind and annul such acceleration and its
consequences; but such action shall not affect any subsequent Event of Default
or Potential Event of Default or impair any right consequent thereon. The
provisions of this paragraph are intended merely to bind Lenders to a decision
that may be made at the election of Requisite Lenders and are not intended to
benefit Company and do not grant Company the right to require Lenders to rescind
or annul any acceleration hereunder, even if the conditions set forth herein are
met.
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Section 9. ADMINISTRATIVE AGENT
9.1 Appointment.
FIB is hereby appointed Administrative Agent hereunder and
under the other Loan Documents and each Lender hereby authorizes Administrative
Agent to act as its agent in accordance with the terms of this Agreement and the
other Loan Documents. Administrative Agent agrees to act upon the express
conditions contained in this Agreement and the other Loan Documents, as
applicable. The provisions of this Section 9 are solely for the benefit of
Administrative Agent, Managing Agents, Co- Arrangers and Lenders and Company
shall have no rights as a third party beneficiary of any of the provisions
thereof. In performing its functions and duties under this Agreement,
Administrative Agent shall act solely as an agent of Lenders and does not assume
and shall not be deemed to have assumed any obligation towards or relationship
of agency or trust with or for Company or any of its Subsidiaries.
9.2 Powers; General Immunity.
A. Duties Specified. Each Lender irrevocably authorizes Administrative
Agent to take such action on such Lender's behalf and to exercise such powers
hereunder and under the other Loan Documents as are specifically delegated to
Administrative Agent by the terms hereof and thereof, together with such powers
as are reasonably incidental thereto. Administrative Agent shall have only those
duties and responsibilities that are expressly specified in this Agreement and
the other Loan Documents and it may perform such duties by or through its agents
or employees. No Managing Agent or Co-Arranger shall have any duty or
responsibility under this Agreement or any Loan Document in its capacity
therein. No Managing Agent, Co- Arranger or Administrative Agent shall have, by
reason of this Agreement or any of the other Loan Documents, a fiduciary
relationship in respect of any Lender; and nothing in this Agreement or any of
the other Loan Documents, expressed or implied, is intended to or shall be so
construed as to impose upon Administrative Agent any obligations in respect of
this Agreement or any of the other Loan Documents except as expressly set forth
herein or therein.
B. No Responsibility for Certain Matters. Administrative Agent shall
not be responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Administrative Agent to Lenders or by
or on behalf of Company to Administrative Agent or any Lender in connection with
the Loan Documents and the transactions contemplated thereby or for the
financial condition or business affairs of Company or any other Person liable
for the payment of any Obligations, nor shall Administrative
111
Agent be required to ascertain or inquire as to the performance or observance of
any of the terms, conditions, provisions, covenants or agreements contained in
any of the Loan Documents or as to the use of the proceeds of the Loans or the
use of the Letters of Credit or as to the existence or possible existence of any
Event of Default or Potential Event of Default. Anything contained in this
Agreement to the contrary notwithstanding, Administrative Agent shall not have
any liability arising from confirmations of the amount of outstanding Loans or
the Letter of Credit Usage or the component amounts thereof.
C. Exculpatory Provisions. Neither Administrative Agent nor any of its
officers, directors, employees or agents shall be liable to Lenders for any
action taken or omitted by Administrative Agent under or in connection with any
of the Loan Documents except to the extent caused by Administrative Agent's
gross negligence or willful misconduct. If Administrative Agent shall request
instructions from Lenders with respect to any act or action (including the
failure to take an action) in connection with this Agreement or any of the other
Loan Documents, Administrative Agent shall be entitled to refrain from such act
or taking such action unless and until Administrative Agent shall have received
instructions from Requisite Lenders. Without prejudice to the generality of the
foregoing, (i) Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any communication, instrument or document
believed by it to be genuine and correct and to have been signed or sent by the
proper person or persons, and shall be entitled to rely and shall be protected
in relying on opinions and judgments of attorneys (who may be attorneys for
Company and its Subsidiaries), accountants, experts and other professional
advisors selected by it; and (ii) no Lender shall have any right of action
whatsoever against Administrative Agent as a result of Administrative Agent
acting or (where so instructed) refraining from acting under this Agreement or
any of the other Loan Documents in accordance with the instructions of Requisite
Lenders. Administrative Agent shall be entitled to refrain from exercising any
power, discretion or authority vested in it under this Agreement or any of the
other Loan Documents unless and until it has obtained the instructions of
Requisite Lenders or all Lenders as required or permitted by this Agreement.
Each Lender agrees that it shall not exercise any right of set-off described in
subsection 10.4 without the concurrence of Administrative Agent.
D. Administrative Agent Entitled to Act as Lender. The agency hereby
created shall in no way impair or affect any of the rights and powers of, or
impose any duties or obligations upon, Administrative Agent in its individual
capacity as a Lender hereunder. With respect to its participation in the Loans
and the Letters of Credit, Administrative Agent shall have the same rights and
powers hereunder as any other Lender and may exercise the same as though it were
not performing the duties and functions delegated to it hereunder, and the term
"Lender" or "Lenders" or any similar term shall, unless the context clearly
otherwise indicates, include Administrative Agent in its individual capacity.
Administrative Agent and its Affiliates may accept deposits from, lend money to
and generally engage in any kind of banking, trust, financial advisory or other
business with Company or any of its Affiliates as if it were not performing the
112
duties specified herein, and may accept fees and other consideration from
Company for services in connection with this Agreement and otherwise without
having to account for the same to Lenders.
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness.
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Company and
its Subsidiaries in connection with the making of the Loans and the issuance of
the Letters of Credit hereunder and that it has made and shall continue to make
its own appraisal of the creditworthiness of Company and its Subsidiaries.
Administrative Agent shall not have any duty or responsibility, either initially
or on a continuing basis, to make any such investigation or any such appraisal
on behalf of Lenders or to provide any Lender with any credit or other
information with respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter, and Administrative Agent
shall not have any responsibility with respect to the accuracy of or the
completeness of any information provided to Lenders.
9.4 Right to Indemnity.
Each Lender, in proportion to its Pro Rata Share, severally
agrees to indemnify Administrative Agent, to the extent that Administrative
Agent shall not have been reimbursed by Company, for and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including, without limitation, counsel fees and disbursements)
or disbursements of any kind or nature whatsoever which may be imposed on,
incurred by or asserted against Administrative Agent in performing its duties
hereunder or under the other Loan Documents or otherwise in its capacity as
Administrative Agent in any way relating to or arising out of this Agreement or
the other Loan Documents; provided that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from Administrative
Agent's gross negligence or willful misconduct. If any indemnity furnished to
Administrative Agent for any purpose shall, in the opinion of Administrative
Agent, be insufficient or become impaired, Administrative Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished.
9.5 Successor Administrative Agent and Swing Line Lender.
A. Administrative Agent may resign at any time by giving 30 days' prior
written notice thereof to Lenders and Company, provided that on or before the
effective date of any such resignation, a successor Administrative Agent shall
have been appointed pursuant to this subsection 9.5A. Administrative Agent may
be removed at any time with cause by an instrument or concurrent instruments in
writing delivered to Company
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and Administrative Agent and signed by Requisite Lenders. Upon any such notice
of resignation or any such removal, Requisite Lenders shall have the right, upon
five Business Days' notice to Company, to appoint a successor Administrative
Agent. Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Administrative Agent and the retiring or
removed Administrative Agent shall be discharged from its duties and obligations
under this Agreement. After any retiring or removed Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Section 9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.
B. Any resignation or removal of Administrative Agent pursuant to
subsection 9.5A shall also constitute the resignation or removal of FIB or its
successor as Swing Line Lender, and any successor Administrative Agent appointed
pursuant to subsection 9.5A shall, upon its acceptance of such appointment,
become the successor Swing Line Lender for all purposes hereunder. In such event
(i) Company shall prepay any outstanding Swing Line Loans made by the retiring
or removed Administrative Agent in its capacity as Swing Line Lender, (ii) upon
such prepayment, the retiring or removed Administrative Agent and Swing Line
Lender shall surrender any Swing Line Note held by it to Company for
cancellation, and (iii) if so requested by the successor Administrative Agent
and Swing Line Lender in accordance with subsection 2.1E, Company shall issue a
new Swing Line Note to the successor Administrative Agent and Swing Line Lender
substantially in the form of Exhibit VII annexed hereto, in the principal amount
of the Swing Line Loan Commitment then in effect and with other appropriate
insertions.
9.6 Collateral Documents.
Each Lender hereby further authorizes Administrative Agent to
enter into the Collateral Documents as secured party on behalf of and for the
benefit of each Lender and agrees to be bound by the terms of the Collateral
Documents; provided that Administrative Agent shall not enter into or consent to
any amendment, modification, termination or waiver of any provision contained in
the Collateral Documents except as set forth in subsection 10.6. Anything
contained in any of the Loan Documents to the contrary notwithstanding, each
Lender agrees that no Lender shall have any right individually to realize upon
any of the collateral under the Collateral Documents, it being understood and
agreed that all rights and remedies under the Collateral Documents may be
exercised solely by Administrative Agent for the benefit of Lenders in
accordance with the terms thereof.
9.7 Release of Collateral.
Administrative Agent may release personal property Collateral
without the consent of any Lender to the extent sold or disposed of by Company
or any of its
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Subsidiaries in a transaction or series of transactions that constitute a
permitted Asset Sale pursuant to subsection 7.7(ii) and that meets all of the
requirements contained therein. Administrative Agent may also, upon Borrower's
request, take such actions as are necessary to terminate any Ship Mortgage
relating to a Barge on file with the United States Coast Guard if, and only if,
(i) such Barge has ceased, or will concurrently with such termination cease, to
be a US Documented Barge and (ii) Administrative Agent shall have received
assurances, reasonably satisfactory to Administrative Agent, that upon giving
effect to such termination, such Barge will be subject to a perfected first
priority Lien in favor of Administrative Agent for the benefit of Lenders.
Section 10. MISCELLANEOUS
10.1 Assignments and Participations in Loans and Letters of Credit
A. General. Each Lender shall have the right at any time to (i) sell,
assign or transfer to any Eligible Assignee, or (ii) sell participations to any
Person in, all or any part (subject to certain limitations set forth in
subsection 10.1B below) of its Commitment or any Loan or Loans made by it or its
Letters of Credit or participations therein or any other interest herein or in
any other Obligations owed to it; provided that no such sale, assignment,
transfer or participation shall, without the consent of Company, require Company
to file a registration statement with the Securities and Exchange Commission or
apply to qualify such sale, assignment, transfer or participation under the
securities laws of any state; provided, further that no such sale, assignment or
transfer described in clause (i) above shall be effective unless and until a
Lender Assignment Agreement (a "Lender Assignment Agreement") effecting such
sale, assignment or transfer shall have been accepted by Administrative Agent as
provided in subsection 10.1B(ii); provided, further that no such sale,
assignment, transfer or participation of any Letter of Credit or any
participation therein may be made separately from a sale, assignment, transfer
or participation of a corresponding interest in the Commitment and the Loans of
the Lender effecting such sale, assignment, transfer or participation; and
provided, further that, anything contained herein to the contrary
notwithstanding, the Swing Line Loan Commitment may not be sold, assigned or
transferred as described in clause (i) above to any Person other than a
successor Administrative Agent and Swing Line Lender to the extent contemplated
by subsection 9.5. Except as otherwise provided in this subsection 10.1, no
Lender shall, as between Company and such Lender, be relieved of any of its
obligations hereunder as a result of any sale, assignment or transfer of, or any
granting of participations in, all or any part of its Commitment or the Loans or
the other Obligations owed to such Lender.
B. Assignments.
(i) Amounts and Terms of Assignments. Each Commitment, Loan,
Letter of Credit or participation therein, or other Obligation may (a)
be assigned in any amount to another Lender or to an Affiliate of the
assigning Lender or
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another Lender, with the giving of notice to Company and Administrative
Agent or (b) be assigned in an aggregate amount of not less than
$5,000,000 (or such lesser amount as shall constitute the aggregate
amount of the Commitment, Loans, Letters of Credit and participations
therein, and other Obligations of the assigning Lender) to any other
Eligible Assignee with the giving of notice to Company and with the
consent of Managing Agents (which consent shall not be unreasonably
withheld). To the extent of any such assignment in accordance with
either clause (a) or (b) above, the assigning Lender shall be relieved
of its obligations with respect to its Commitment, Loans, Letters of
Credit or participations therein, or other Obligations or the portion
thereof so assigned. The parties to each such assignment shall execute
and deliver to Administrative Agent, for its acceptance, a Lender
Assignment Agreement, together with a processing fee of $2,500 and such
forms, certificates or other evidence, if any, with respect to United
States federal income tax withholding matters as the assignee under
such Lender Assignment Agreement may be required to deliver to
Administrative Agent pursuant to subsection 2.7B(iii)(a). Upon such
execution, delivery, acceptance and recordation from and after the
effective date specified in such Lender Assignment Agreement, (y) the
assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to
such Lender Assignment Agreement, shall have the rights and obligations
of a Lender hereunder and (z) the assigning Lender thereunder shall, to
the extent that rights and obligations hereunder have been assigned by
it pursuant to such Lender Assignment Agreement, relinquish its rights
and be released from its obligations under this Agreement (and, in the
case of a Lender Assignment Agreement covering all or the remaining
portion of an assigning Lender's rights and obligations under this
Agreement, such Lender shall cease to be a party hereto). The
Commitments hereunder shall be modified to reflect the Commitment of
such assignee and any remaining Commitment of such assigning Lender and
the assigning Lender shall, upon the effectiveness of such assignment
or as promptly thereafter as practicable, surrender its Note to
Administrative Agent for cancellation, and thereupon new Notes shall,
if so requested by the assignee and/or the assigning Lender in
accordance with subsection 2.1E, be issued to the assignee and/or to
the assigning Lender, substantially in the form of Exhibit VI or
Exhibit VII, respectively, annexed hereto with appropriate insertions,
to reflect the new Commitments of the assignee and/or the assigning
Lender.
(ii) Acceptance by Administrative Agent. Upon its receipt of a
Lender Assignment Agreement executed by an assigning Lender and an
assignee representing that it is an Eligible Assignee, together with
the processing fee and any forms, certificates or other evidence with
respect to United States federal income tax withholding matters that
such assignee may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii)(a), Administrative Agent shall, if
such Lender Assignment Agreement has been completed and is in
substantially the form of Exhibit V hereto and if Managing Agents have
consented
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to the assignment evidenced thereby (to the extent such consent is
required pursuant to subsection 10.1B(i)), (a) accept such Lender
Assignment Agreement by executing a counterpart thereof as provided
therein (which acceptance shall evidence any required consent of
Administrative Agent to such assignment) and (b) give prompt notice
thereof to Company. Administrative Agent shall maintain a copy of each
Lender Assignment Agreement delivered to and accepted by it as provided
in this subsection 10.1B(ii).
(iii) Mandatory Assignment by Non-Suitable Lender. If any
Lender is required to qualify or be found suitable by the regulations
of any Gaming Authority and does not so qualify or otherwise not meet
the suitability standards pursuant to such regulations (in such case, a
"Former Lender"), such Former Lender shall and hereby agrees to sell
its rights and obligations under this Agreement to Eligible Assignee
(the "Substitute Lender"). The Substitute Lender shall assume the
rights and obligations of the Former Lender under this Agreement
pursuant to a Lender Assignment Agreement, which assumption shall be
required to comply with, and shall become effective in accordance with,
the provisions of subsection 10.1B; provided that the purchase price to
be paid by the Substitute Lender to Administrative Agent for the
account of the Former Lender for such assumption shall equal the sum of
(i) the unpaid principal amount of any Loans held by the Former Lender
plus accrued interest thereon plus (ii) the Former Lender's Pro Rata
Share (through the required purchase of participations pursuant to
subsection 3.1C) of the aggregate amount of drawings under all Letters
of Credit that have not been reimbursed by Company, plus accrued
interest thereon, plus (iii) such Former Lender's pro rata share of
accrued fees to the date of the assumption; provided further that, upon
receipt by the Former Lender of all such amounts, Administrative Agent
shall thereafter pay all obligations owing to the Former Lender under
the Loan Documents to the Substitute Lender. Each Lender agrees that if
it becomes a Former Lender, upon payment to it by Administrative Agent
(upon Administrative Agent's receipt thereof from the Substitute
Lender) of all such amounts, if any, owing to it under the Loan
Documents, it will execute and deliver a Lender Assignment Agreement.
Notwithstanding the foregoing, if any Lender becomes a Former
Lender and fails to find a Substitute Lender within 10 days of being
determined unsuitable or unqualified, or such lesser period of time as
specified by any such Gaming Authority for the withdrawal of a Former
Lender (the "Withdrawal Period"), Company shall have an additional 90
day period, or such lesser period of time as specified by such Gaming
Authority, to find a Substitute Lender, which Substitute Lender shall
assume the rights and obligations of the Former Lender as provided in
the preceding paragraph. In the event that Company shall not have found
a Substitute Lender within such period of time, Company shall
immediately (i) prepay in full the outstanding principal amount of
Loans held by such Former Lender, together with accrued interest
thereon to the earlier of (X) the date of payment or (Y) the last day
of any Withdrawal Period, and (ii) at the option of
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Company either (A) place an amount equal to such Former Lender's Pro
Rata Share in each Letter of Credit issued by Administrative Agent, in
a separate cash collateral account with Administrative Agent for each
outstanding Letter of Credit, which amount will be applied by
Administrative Agent to satisfy Company's reimbursement obligations to
Administrative Agent in respect of unreimbursed drawings under the
applicable Letter of Credit or (B) if no Event of Default then exists,
terminate the Revolving Loan Commitment of such Former Lender, at which
time the other Lenders' Pro Rata Shares will be automatically adjusted
as a result thereof; provided that the option specified in this clause
(B) may only be exercised if, immediately after giving effect thereto,
no Lender's outstanding Revolving Loans, when added to the product of
(a) such Lender's Pro Rata Share and (b) the sum of (I) the aggregate
amount of all outstanding Letters of Credit at such time and (II) the
aggregate amount of all Swing Line Loans then outstanding, would exceed
such Lender's Revolving Loan Commitment at such time. Each Lender
agrees that, to the extent and for so long as required by any
applicable Gaming Authority, such Lender's rights and obligations under
this Agreement are subject to the provisions of this subsection
10.1B(iii) and all restrictions of any applicable Gaming Authority.
C. Participations. The holder of any participation, other than an
Affiliate of the Lender granting such participation, shall not be entitled to
require such Lender to take or omit to take any action hereunder except action
directly affecting (i) the extension of the final maturity of any portion of the
principal amount of or interest on any Loan allocated to such participation or
(ii) a reduction of the principal amount of or the rate of interest payable on
any Loan allocated to such participation, and all amounts payable by Company
hereunder (including without limitation amounts payable to such Lender pursuant
to subsections 2.6D and 2.7) shall be determined as if such Lender had not sold
such participation. Company and each Lender hereby acknowledge and agree that,
solely for purposes of subsections 10.4 and 10.5, (a) any participation will
give rise to a direct obligation of Company to the participant and (b) the
participant shall be considered to be a "Lender".
D. Assignments to Federal Reserve Banks. In addition to the assignments
and participations permitted under the foregoing provisions of this subsection
10.1, any Lender may assign and pledge all or any portion of its Loans, the
other Obligations owed to such Lender, and its Note to any Federal Reserve Bank
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any operating circular issued by such Federal Reserve
Bank; provided that (i) no Lender shall, as between Company and such Lender, be
relieved of any of its obligations hereunder as a result of any such assignment
and pledge and (ii) in no event shall such Federal Reserve Bank be considered to
be a "Lender" or be entitled to require the assigning Lender to take or omit to
take any action hereunder.
E. Assignments and Participations Subject to Gaming Laws. Subject to
the last sentence of this subsection 10.1E, each Lender agrees that all
assignments and
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participations made hereunder shall be subject to, and made in compliance with,
all Gaming Laws applicable to Lenders. Company hereby acknowledges that unless
Company has provided Lenders with a written opinion of counsel as to the
suitability standards applicable to Lenders of any relevant Gaming Authority
with jurisdiction over the business of Company and its Subsidiaries, no Lender
shall have the responsibility of determining whether or not a potential assignee
or participant of such Lender would qualify as a suitable Lender under the
Gaming Laws of any such jurisdiction.
F. Information. Each Lender may furnish any information concerning
Company and its Subsidiaries in the possession of that Lender from time to time
to assignees and participants (including prospective assignees and
participants), subject to subsection 10.19.
10.2 Expenses.
Whether or not the transactions contemplated hereby shall be
consummated, Company agrees to pay promptly (i) all the actual and reasonable
costs and expenses of preparation of the Loan Documents; (ii) all the costs of
furnishing all opinions by counsel for Company (including without limitation any
opinions requested by Lenders as to any legal matters arising hereunder) and of
each Loan Party's performance of and compliance with all agreements and
conditions on its part to be performed or complied with under this Agreement and
the other Loan Documents including, without limitation, with respect to
confirming compliance with environmental and insurance requirements; (iii) the
reasonable fees, expenses and disbursements of counsel to Administrative Agent
(including Allocated Costs of Internal Counsel) in connection with the
negotiation, preparation, execution and administration of the Loan Documents and
the Loans and any consents, amendments, waivers or other modifications hereto or
thereto and any other documents or matters requested by Company or any other
Loan Party; (iv) all other actual and reasonable costs and expenses incurred by
Administrative Agent, Managing Agents and Co-Arrangers in connection with the
syndication of the Commitments and the negotiation, preparation and execution of
the Loan Documents and the transactions contemplated hereby and thereby; and (v)
after the occurrence of an Event of Default, all costs and expenses, including
reasonable attorneys' fees (including Allocated Costs of Internal Counsel) and
costs of settlement, incurred by Administrative Agent and Lenders in enforcing
any Obligations of or in collecting any payments due from Company or any other
Loan Party hereunder or under the other Loan Documents by reason of such Event
of Default or in connection with any refinancing or restructuring of the credit
arrangements provided under this Agreement in the nature of a "work-out" or
pursuant to any insolvency or bankruptcy proceedings.
10.3 Indemnity.
In addition to the payment of expenses pursuant to subsection
10.2, whether or not the transactions contemplated hereby shall be consummated,
Company agrees to defend, indemnify, pay and hold harmless Administrative Agent,
Managing
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Agents and Co-Arrangers and Lenders, and the officers, directors, employees,
agents and affiliates of Administrative Agent and Lenders (collectively called
the "Indemnitees") from and against any and all other liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, costs, expenses
and disbursements of any kind or nature whatsoever (including without limitation
the reasonable fees and disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including without limitation securities and
commercial laws, statutes, rules or regulations and Environmental Laws), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner relating
to or arising out of this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including without limitation
Lenders' agreement to make the Loans hereunder or the use or intended use of the
proceeds of any of the Loans or the issuance of the Letters of Credit hereunder
or the use or intended use of any of the Letters of Credit) or the statements
contained in the commitment letter delivered by any Lender to Company with
respect thereto (collectively called the "Indemnified Liabilities"); provided
that Company shall not have any obligation to any Indemnitee hereunder with
respect to any Indemnified Liabilities to the extent such Indemnified
Liabilities arise solely from the gross negligence or willful misconduct of that
Indemnitee as determined by a final judgment of a court of competent
jurisdiction. To the extent that the undertaking to defend, indemnify, pay and
hold harmless set forth in the preceding sentence may be unenforceable because
it is violative of any law or public policy, Company shall contribute the
maximum portion that it is permitted to pay and satisfy under applicable law to
the payment and satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them.
10.4 Set-Off; Security Interest in Deposit Accounts.
In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence and during the continuation of any Event of Default each Lender (with
the consent of Administrative Agent) is hereby authorized by Company at any time
or from time to time, without notice to Company or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits (general or special, including, but not limited to,
Indebtedness evidenced by certificates of deposit, whether matured or unmatured,
but not including trust accounts) and any other Indebtedness at any time held or
owing by that Lender to or for the credit or the account of Company against and
on account of the obligations and liabilities of Company to that Lender under
this Agreement, the Letters of Credit and participations therein and the other
Loan Documents, including, but not limited to, all claims of any nature or
description arising out of or connected with this Agreement, the Letters of
Credit and participations therein or any other Loan Document, irrespective of
whether or not
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(i) that Lender shall have made any demand hereunder or (ii) the principal of or
the interest on the Loans or any amounts in respect of the Letters of Credit or
any other amounts due hereunder shall have become due and payable pursuant to
Section 8 and although said obligations and liabilities, or any of them, may be
contingent or unmatured. Company hereby further grants to Administrative Agent
and each Lender a security interest in all deposits and accounts maintained with
Administrative Agent or such Lender as security for the Obligations.
10.5 Ratable Sharing.
Lenders hereby agree among themselves that if any of them
shall, whether by voluntary payment, by realization upon security, through the
exercise of any right of set-off or banker's lien, by counterclaim or cross
action or by the enforcement of any right under the Loan Documents or otherwise,
or as adequate protection of a deposit treated as cash collateral under the
Bankruptcy Code, receive payment or reduction of a proportion of the aggregate
amount of principal, interest, amounts payable in respect of Letters of Credit,
fees and other amounts then due and owing to that Lender hereunder or under the
other Loan Documents (collectively, the "Aggregate Amounts Due" to such Lender)
which is greater than the proportion received by any other Lender in respect of
the Aggregate Amounts Due to such other Lender, then the Lender receiving such
proportionately greater payment shall (i) notify Administrative Agent and each
other Lender of the receipt of such payment and (ii) apply a portion of such
payment to purchase participations (which it shall be deemed to have purchased
from each seller of a participation simultaneously upon the receipt by such
seller of its portion of such payment) in the Aggregate Amounts Due to the other
Lenders so that all such recoveries of Aggregate Amounts Due shall be shared by
all Lenders in proportion to the Aggregate Amounts Due to them; provided that if
all or part of such proportionately greater payment received by such purchasing
Lender is thereafter recovered from such Lender upon the bankruptcy or
reorganization of Company or otherwise, those purchases shall be rescinded and
the purchase prices paid for such participations shall be returned to such
purchasing Lender ratably to the extent of such recovery, but without interest.
Company expressly consents to the foregoing arrangement and agrees that any
holder of a participation so purchased may exercise any and all rights of
banker's lien, set-off or counterclaim with respect to any and all monies owing
by Company to that holder with respect thereto as fully as if that holder were
owed the amount of the participation held by that holder.
10.6 Amendments and Waivers.
No amendment, modification, termination or waiver of any
provision of this Agreement, the Notes or any other Loan Document, or consent to
any departure by Company therefrom, shall in any event be effective without the
written concurrence of Requisite Lenders; provided that any such amendment,
modification, termination, waiver or consent which: increases the amount of any
of the Commitments; changes any Lender's Pro Rata Share; changes in any manner
the definition of "Requisite Lenders";
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changes in any manner any provision of this Agreement which, by its terms,
expressly requires the approval or concurrence of all Lenders; postpones the
Commitment Termination Date; postpones the date on which any interest or any
fees are payable; decreases the interest rate borne by any of the Loans (other
than any waiver of any increase in the interest rate applicable to any of the
Loans pursuant to subsection 2.2E) or the amount of any fees payable hereunder;
increases the maximum duration of Interest Periods permitted hereunder; reduces
the amount or postpones the due date of any amount payable in respect of, or
extends the required expiration date of, any Letter of Credit; changes in any
manner the obligations of Lenders relating to the purchase of participations in
Letters of Credit; or changes in any manner the provisions contained in
subsection 8.1 or this subsection 10.6 shall be effective only if evidenced by a
writing signed by or on behalf of all Lenders. In addition, (i) any amendment,
modification, termination or waiver of any of the provisions contained in
Section 4 shall be effective only if evidenced by a writing signed by or on
behalf of Administrative Agent and Requisite Lenders, (ii) no amendment,
modification, termination or waiver of any provision of any Note shall be
effective without the written concurrence of the Lender which is the holder of
that Note, (iii) no amendment, modification, termination or waiver of any
provision of subsection 2.1B or any other provision of this Agreement relating
to the Swing Line Loan Commitment or the Swing Line Loans shall be effective
without the written concurrence of Swing Line Lender, (iv) no amendment,
modification, termination or waiver of any provision of Section 3 or of any
Letter of Credit shall be effective without the written concurrence of
Administrative Agent, and (v) no amend- ment, modification, termination or
waiver of any provision of Section 9 or of any other provision of this Agreement
which, by its terms, expressly requires the approval or concurrence of
Administrative Agent shall be effective without the written concurrence of
Administrative Agent. Administrative Agent may, but shall have no obligation to,
with the written concurrence of any Lender, execute amendments, modifications,
waivers or consents on behalf of that Lender. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given. No notice to or demand on Company in any case shall entitle
Company to any other or further notice or demand in similar or other
circumstances. Any amendment, modification, termination, waiver or consent
effected in accordance with this subsection 10.6 shall be binding upon each
Lender at the time outstanding, each future Lender and, if signed by Company, on
Company.
10.7 Independence of Covenants.
All covenants hereunder shall be given independent effect so
that if a particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to, or would
otherwise be within the limitations of, another covenant shall not avoid the
occurrence of an Event of Default or Potential Event of Default if such action
is taken or condition exists.
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10.8 Notices.
Unless otherwise specifically provided herein, any notice or
other communication herein required or permitted to be given shall be in writing
and may be personally served, telexed or sent by telefacsimile or United States
mail or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex, or five
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed. For the purposes hereof, the address of each party
hereto shall be as set forth under such party's name on the signature pages
hereof or such other address as shall be designated by such party in a written
notice delivered to the other parties hereto.
10.9 Survival of Representations, Warranties and Agreements.
A. All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by law to the
contrary, the agreements of Company set forth in subsections 2.6D, 2.7, 10.2,
10.3 and 10.4 and the agreements of Lenders set forth in subsections 9.2C, 9.4
and 10.5 shall survive the payment of the Loans, the cancellation or termination
of the Letters of Credit and the reimbursement of any amounts drawn thereunder,
and the termination of this Agreement.
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Administrative Agent or any
Lender in the exercise of any power, right or privilege hereunder or under any
other Loan Document shall impair such power, right or privilege or be construed
to be a waiver of any default or acquiescence therein, nor shall any single or
partial exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 Marshalling; Payments Set Aside.
Neither Administrative Agent nor any Lender shall be under any
obligation to marshal any assets in favor of Company or any other party or
against or in payment of any or all of the Obligations. To the extent that
Company makes a payment or payments to Administrative Agent or Lenders (or to
Administrative Agent for the benefit of Lenders), or Administrative Agent or
Lenders enforce any security interests or exercise their rights of setoff, and
such payment or payments or the proceeds of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
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preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, any other state or federal law, common
law or any equitable cause, then, to the extent of such recovery, the obligation
or part thereof originally intended to be satisfied, and all Liens, rights and
remedies therefor or related thereto, shall be revived and continued in full
force and effect as if such payment or payments had not been made or such
enforcement or setoff had not occurred.
10.12 Severability.
In case any provision in or obligation under this Agreement or
the Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 Obligations Several; Independent Nature of Lenders' Rights.
The obligations of Lenders hereunder are several and no Lender
shall be responsible for the obligations or Commitment of any other Lender
hereunder. Nothing contained herein or in any other Loan Document, and no action
taken by Lenders pursuant hereto or thereto, shall be deemed to constitute
Lenders as a partnership, an association, a Joint Venture or any other kind of
entity. The amounts payable at any time hereunder to each Lender shall be a
separate and independent debt, and each Lender shall be entitled to protect and
enforce its rights arising out of this Agreement and it shall not be necessary
for any other Lender to be joined as an additional party in any proceeding for
such purpose.
10.14 Headings.
Section and subsection headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
10.15 Applicable Law.
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED
BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF NEVADA, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES; PROVIDED
THAT THE EXERCISE OF CERTAIN RIGHTS HEREUNDER OR UNDER THE LOAN DOCUMENTS MAY BE
SUBJECT TO AND/OR REQUIRE COMPLIANCE WITH THE GAMING LAWS.
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10.16 Successors and Assigns.
This Agreement shall be binding upon the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
parties hereto and the successors and assigns of Lenders (it being understood
that Lenders' rights of assignment are subject to subsection 10.1). Neither
Company's rights or obligations hereunder nor any interest therein may be
assigned or delegated by Company without the prior written consent of all
Lenders.
10.17 Consent to Jurisdiction and Service of Process; Choice of Forum.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST COMPANY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY OBLIGATION MAY BE
BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE OF
NEVADA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT COMPANY ACCEPTS FOR
ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE
JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH THIS AGREEMENT, SUCH OTHER LOAN DOCUMENT OR SUCH OBLIGATION.
Company hereby agrees that service of all process in any such proceeding in any
such court may be made by registered or certified mail, return receipt
requested, to Company at its address provided in subsection 10.8, such service
upon receipt by Company being hereby acknowledged by Company to be sufficient
for personal jurisdiction in any action against Company in any such court upon
such receipt and to be otherwise effective and binding service in every respect.
Nothing herein shall affect the right to serve process in any other manner
permitted by law or shall limit the right of any Lender to bring proceedings
against Company in the courts of any other jurisdiction.
10.18 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY
DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR
THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this
waiver is intended to be all-encompassing of any and all disputes that may be
filed in any court and that relate to the subject matter of this transaction,
including without limitation contract claims, tort claims, breach of duty claims
and all other common law and statutory claims. Each party hereto acknowledges
that this waiver is a
material inducement to enter into a business relationship, that each has already
relied on this waiver in entering into this Agreement, and that each will
continue to rely on this
125
waiver in their related future dealings. Each party hereto further warrants and
represents that it has reviewed this waiver with its legal counsel and that it
knowingly and voluntarily waives its jury trial rights following consultation
with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THE LOANS MADE HEREUNDER. In the event of litigation, this Agreement
may be filed as a written consent to a trial by the court.
10.19 Confidentiality.
Each Lender shall hold all non-public information obtained
pursuant to the requirements of this Agreement which has been identified as
confidential by Company in accordance with such Lender's customary procedures
for handling confidential information of this nature and in accordance with safe
and sound banking practices, it being understood and agreed by Company that in
any event a Lender may make disclosures reasonably required by any bona fide
assignee, transferee or participant in connection with the contemplated
assignment or transfer by such Lender of any Loans or any participation therein
or as required or requested by any governmental agency or representative thereof
or pursuant to legal process; provided that, unless specifically prohibited by
applicable law or court order, each Lender shall notify Company of any request
by any governmental agency or representative thereof (other than any such
request in connection with any examination of the financial condition of such
Lender by such governmental agency) for disclosure of any such non-public
information prior to disclosure of such information; and provided, further that
in no event shall any Lender be obligated or required to return any materials
furnished by Company or any of its Subsidiaries.
10.20 Licensing of Administrative Agent and Lenders.
If an Event of Default shall have occurred hereunder or under
any of the Loan Documents and it shall become necessary, or in the opinion of
Administrative Agent advisable, for an agent, receiver or other representative
of Administrative Agent to become licensed under the provisions of the laws of
the State of Illinois, Louisiana or Nevada, or rules and regulations adopted
pursuant thereto, as a condition to receiving the benefit of any Collateral
encumbered by the Collateral Documents for the benefit of Administrative Agent
on behalf of Lenders or otherwise to enforce their rights hereunder, Company
does hereby give its consent, and agrees to cause its Subsidiaries to give their
consents, to the granting of such license or licenses and agrees to execute such
further documents as may be required in connection with the evidencing of such
consent.
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10.21 Counterparts; Effectiveness.
This Agreement and any amendments, waivers, consents or
supplements hereto or in connection herewith may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Company and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
10.22 Cooperation With Gaming Boards. Administrative Agent and each Lender agree
to cooperate with all Gaming Boards in connection with the administration of
their regulatory jurisdiction over any Loan Party, including the provision of
such documents or other information as may be requested by any such Gaming Board
relating to any Loan Party or to the Loan Documents.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
PLAYERS INTERNATIONAL, INC.,
as Borrower
By:
Title:
Notice Address:
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President and Chief
Financial Officer
With copies to:
Players International, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Players International, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
FIRST INTERSTATE BANK OF NEVADA, N.A.,
individually, as Administrative Agent,
a Managing Agent and a Co-Arranger
By:
Title:
Notice Address:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
S-1
BANKERS TRUST COMPANY,
individually and as a Managing Agent
By:
Title:
Notice Address:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
With a copy to:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
FIRST NATIONAL BANK OF COMMERCE,
as a Lender
By:
Title:
Notice Address:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
S-2
FIRST NATIONAL BANK OF METROPOLIS,
as a Lender
By:
Title:
Notice Address:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
MERCANTILE BANK OF ST. LOUIS, N.A.,
as a Lender
By:
Title:
Notice Address:
▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
NBD BANK,
as a Lender
By:
Title:
Notice Address:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
S-3
PRIMERIT BANK, FSB,
as a Lender
By:
Title:
Notice Address:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, #▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
S-4
EXHIBITS
I FORM OF NOTICE OF BORROWING
III FORM OF NOTICE OF CONVERSION/CONTINUATION
IV FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
V FORM OF LENDER ASSIGNMENT AGREEMENT
VI FORM OF REVOLVING NOTE
VII FORM OF SWING LINE NOTE
VIII FORM OF COLLATERAL ACCOUNT AGREEMENT
IX-A FORM OF OPINION OF COMPANY COUNSEL
IX-B FORM OF OPINION OF O'MELVENY & ▇▇▇▇▇
X FORM OF COMPLIANCE CERTIFICATE
XI FORM OF COMPANY PLEDGE AGREEMENT
XI-A FORM OF COMPANY PLEDGE AGREEMENT (NEVADA)
XI-B FORM OF LLC MEMBERSHIP INTEREST SECURITY
AGREEMENT
XI-C FORM OF FIRST AMENDMENT TO COMPANY PLEDGE
AGREEMENT (NEVADA)
XII FORM OF ENVIRONMENTAL INDEMNITY
XIII-A FORM OF ILLINOIS MORTGAGE
XIII-B FORM OF LOUISIANA MORTGAGE
XIII-C FORM OF NEVADA DEED OF TRUST
XIV FORM OF SHIP MORTGAGE
XV FORM OF GUARANTY
XVI FORM OF COMPANY SECURITY AGREEMENT
XVII-A FORM OF SUBSIDIARY SECURITY AGREEMENT (ILLINOIS)
XVII-B FORM OF SUBSIDIARY SECURITY AGREEMENT (LOUISIANA)
XVII-C FORM OF SUBSIDIARY SECURITY AGREEMENT (NEVADA)
XVIII FORM OF PARTNERSHIP INTEREST SECURITY AGREEMENT
XIX FORM OF MASTER VESSEL AND COLLATERAL TRUST
AGREEMENT
(v)
SCHEDULES
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES
5.1 SUBSIDIARIES OF COMPANY
5.5 US DOCUMENTED BARGES
5.6 LITIGATION MATTERS
5.11 ERISA MATTERS
5.13 ENVIRONMENTAL MATTERS
5.19 TRADEMARK MATTERS
6.4(a) MINIMUM INSURANCE REQUIREMENTS
6.4(b) MINIMUM INSURANCE REQUIREMENTS - CONSTRUCTION
6.9 POST-CLOSING CONDITIONS
7.2 LIENS
7.3 INVESTMENTS
7.11 INTELLECTUAL PROPERTY ASSIGNMENTS
▇-▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ PREMISES
A-2 DESCRIPTION OF LOUISIANA PREMISES
A-3 DESCRIPTION OF NEVADA PREMISES
(vi)