Exhibit 10.44
AMENDED AND RESTATED INTERCREDITOR AGREEMENT
THE INTERCREDITOR AGREEMENT, dated as of July 28, 2000 (the "Original
Agreement") as amended, supplemented or modified from time to time, this
"Agreement"), entered into by and among: Citadel Holding Corporation, a Nevada
corporation now known as Reading International, Inc. (together with its
permitted successors and assigns, "Citadel"); ▇▇▇▇▇▇ ▇▇▇▇ Capital, L.L.C., a New
York limited liability company (together with its permitted successors and
assigns, "SHC"); and Nationwide Theatres Corp., a California corporation
(together with its permitted successors and assigns, "Nationwide") is hereby
amended and restated as of January 29, 2002.
R E C I T A L S
WHEREAS, Nationwide is the holder of certain obligations of ▇▇▇▇▇▇ Hill
Associates, a California general partnership ("▇▇▇▇▇▇ ▇▇▇▇"), which relate to
various assets of ▇▇▇▇▇▇ Hill or its Affiliates (the "Affected Assets") (such
agreements, documents and instruments between Nationwide and ▇▇▇▇▇▇ ▇▇▇▇
evidencing such obligations and representing a principal indebtedness of
$11,000,000, collectively referred to as the "Existing Nationwide Agreement,"
the balance of such obligations of ▇▇▇▇▇▇ Hill to Nationwide being unaffected by
this Agreement and not included in the "Existing Nationwide Agreement");
WHEREAS, pursuant to the Existing Nationwide Agreement, there are
outstanding loans in the aggregate principal amount of eleven million Dollars
($11,000,000);
WHEREAS, the Affected Assets are being transferred from ▇▇▇▇▇▇ ▇▇▇▇ or its
Affiliates to SHC, which is wholly owned by ▇▇▇▇▇▇ Hill, and, in connection with
such transfer, ▇▇▇▇▇▇ ▇▇▇▇ desires to amend and modify the Existing Nationwide
Agreement;
WHEREAS, SHC and Citadel have entered into an agreement dated as of July
28, 2000 as amended and restated of January 29, 2002 (as amended, restated,
modified or supplemented from time to time, the "Citadel Agreement"), pursuant
to which Citadel will make available to SHC a standby credit facility in an
aggregate principal amount up to eighteen million Dollars ($18,000,000);
WHEREAS, as a condition precedent of borrowing under the Citadel
Agreement, SHC and Citadel must enter into the Subordinated Documents (as
hereinafter defined);
WHEREAS, Nationwide required that, in order to satisfy a condition to the
amendment and modification of the Existing Nationwide Agreement (the Existing
Nationwide Agreement, as so amended and modified, the "Nationwide Agreement"),
that the Original Agreement and this Agreement be entered into among the parties
hereto; and
WHEREAS, the purpose of this Agreement is to confirm, as between
Nationwide and Citadel, their respective rights and priorities with respect to
the obligations of SHC and with respect to the Equity Collateral and the
Borrower Collateral (as such terms are defined in the Citadel Agreement) now or
hereafter held as security by Nationwide in respect of the Nationwide
Indebtedness and by Citadel in respect of the Citadel Indebtedness.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.01 Certain Defined Terms. Unless otherwise defined herein, terms
that are defined in the Citadel Agreement and used herein are so used as so
defined, and the following terms shall have the following meanings:
"Affiliate" of any Person means any other Person controlling,
controlled by or under direct or indirect common control with such Person.
For the purposes of this definition, "control," when used with respect to
any specified Person, means the power to direct the management and
policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled by" have the meanings correlative to the
foregoing. Notwithstanding the foregoing: (a) SHC and its Affiliates
("SHC's Affiliates") shall not include Reading, Citadel and their
respective direct or indirect Subsidiaries; (b) Reading, Citadel and their
respective direct or indirect Subsidiaries, on the one hand, and SHC and
SHC's Affiliates, on the other hand, shall not be considered Affiliates of
each other; (c) SHC and SHC's Affiliates shall not include Nationwide and
its direct or indirect Subsidiaries; (d) none of Nationwide or any of its
direct or indirect Subsidiaries, on the one hand, and SHC or any of SHC's
Affiliates, on the other hand, shall be considered Affiliates of each
other; (e) Citadel and its Affiliates ("Citadel's Affiliates") shall not
include Nationwide and its direct or indirect Subsidiaries; (f) Reading
and its Affiliates ("Reading's Affiliates") shall not include Nationwide
and its direct or indirect Subsidiaries; and (f) none of Nationwide or any
of its direct or indirect Subsidiaries, on the one hand, and either
Citadel or any of Citadel's Affiliates or Reading and any of Reading's
Affiliates, on the other hand, shall be considered Affiliates of each
other.
"Agreement" has the meaning specified in the preamble to this
Agreement.
"Bad Faith Determination" with respect to a Citadel Proceeding means
the entry of one or more Final Orders (i)(a) dismissing such Citadel
Proceeding if (I) neither Nationwide
nor SHC consented to such Citadel Proceeding and at least one of
Nationwide or SHC opposed such Citadel Proceeding and (II) such Final
Order is based on a finding by the court that (A) in the case of a Citadel
Proceeding under the Federal bankruptcy laws, the criteria in 11 U.S.C.
'303(b) are not satisfied or (B) in any other case, the relevant statutory
criteria for bringing such Citadel Proceeding are not satisfied and (b)
finding that any Petitioning Creditor in such Citadel Proceeding which is
Citadel or a Citadel Affiliate, at the time such petition or other action
was filed or taken, initiated such Citadel Proceeding in "bad faith" (or
words of similar import) or (ii) granting judgment against a Petitioning
Creditor therein which is Citadel or an Affiliate of Citadel under 11
U.S.C. '303(i)(2) (as any such statutory section referenced herein may
hereafter be modified, restated or amended).
"Blockage Period" has the meaning specified in Section 2.02(b).
"Change" has the meaning specified in paragraph (b) of Section 2.10.
"Citadel" has the meaning specified in the preamble to this
Agreement.
"Citadel Agreement Payment Default" means an Event of Default under
Section 9.1(a) of the Citadel Agreement.
"Citadel Event of Default" means an Event of Default as such term is
defined in the Citadel Agreement.
"Citadel Indebtedness" means any and all amounts of money from time
to time owing by, and any and all obligations and liabilities from time to
time of, SHC under the Subordinated Documents, whether now existing or
hereafter arising (as limited by the terms of this Agreement), fixed or
contingent, due or not due, liquidated or unliquidated, determined or
undetermined, and whether for fees, indemnities, costs, expenses or
otherwise, including without limitation any rights of indemnification,
reimbursement, subrogation or contribution arising under the Subordinated
Documents.
"Citadel Proceeding" means an Insolvency or Liquidation Proceeding
in which Citadel or any Citadel Affiliate is a Petitioning Creditor;
provided, however, that, if the Citadel Indebtedness is transferred, the
term Citadel Proceeding shall mean an Insolvency or Liquidation Proceeding
in which the holder of the Citadel Indebtedness or an Affiliate of such
holder is a Petitioning Creditor.
"Credit Agreement" shall mean each credit agreement, loan agreement,
note purchase agreement and each other agreement or arrangement between
SHC and a lender or lenders to SHC or other Person or Persons providing
credit support to SHC or to debt issued by or on behalf of SHC, as the
same may be amended, restated, modified or supplemented from time
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to time, including without limitation the Nationwide Agreement and
collectively, the Citadel Agreement and the Subordinated Documents.
"Creditor" shall mean each of Nationwide and Citadel, in their
respective roles as lender to SHC.
"Final Order" means a judgment by a court of competent jurisdiction,
not subject to further appeal or with respect to which the time to appeal
has lapsed.
"Fully Paid" means, with respect to the Nationwide Indebtedness, for
purposes only of this Agreement, as of any date, that on or before such
date (i) the principal of such Nationwide Indebtedness shall have been
paid in full in immediately available funds or such other manner
satisfactory to Nationwide, (ii) all interest accrued on such Nationwide
Indebtedness as of such date (including interest accrued after, or that
would have accrued but for, the filing of a petition under Title 11 of the
United States Code (or any successor statute thereto) or the institution
or initiation of any other Insolvency or Liquidation Proceeding, in
accordance with the terms of such Nationwide Indebtedness) shall have been
paid in full in immediately available funds or such other manner
satisfactory to Nationwide, and (iii) all fees and expenses and other
amounts then due and payable that constitute Nationwide Indebtedness shall
have been paid in full in immediately available funds or such other manner
satisfactory to Nationwide; provided, however, that if, at any time after
the Nationwide Indebtedness is determined to be "Fully Paid" for purposes
of this Agreement, any other amounts that constitute Nationwide
Indebtedness become due and payable, such other Nationwide Indebtedness
shall be "Fully Paid" for such purpose only upon satisfaction of the
conditions specified in foregoing clause (i), (ii) or (iii), as the case
may be, and the provisions of this Agreement shall remain, or shall be
revived and thereafter remain, in full force and effect, with respect only
to the principal amount of the Citadel Indebtedness then outstanding and
accrued interest thereon, and any other amounts payable with respect
thereto, then unpaid, until such other Nationwide Indebtedness shall be
Fully Paid pursuant hereto.
"Insolvency or Liquidation Proceeding" means (i) any insolvency or
bankruptcy case or proceeding (including any case under the Bankruptcy
Code), or any receivership, liquidation, reorganization or other similar
case or proceeding relative to SHC or all or substantially all of its
assets, or (ii) any liquidation, dissolution, reorganization or winding up
of SHC, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (iii) any assignment of all or substantially
all of the assets of SHC for the benefit of creditors or any other
marshaling of assets and liabilities of SHC.
"Nationwide" has the meaning specified in the preamble to this
Agreement.
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"Nationwide Accrual" means interest on the principal of the
Nationwide Indebtedness (i) relating to any period in respect of which
either (x) Citadel Cinemas has failed to pay any amount of Basic Rent or
Additional Rent (each as defined in the Lease Agreement) or (y) as a
result of the failure by Citadel Cinemas to perform any of its obligations
under any of the Operational Documents, SHC has applied Basic Rent
received by it to perform such obligations, in each case under clause (x)
or (y) limited to the lesser of (a) the amount which Citadel Cinemas
failed to so pay or the amount which SHC has so applied, as the case may
be, and (b) the amount of such interest, or (ii) which remains unpaid and
accruing on such principal (or, but for the filing of a Citadel
Proceeding, that would have accrued on such principal) during the pendency
of a Citadel Proceeding if there is a Bad Faith Determination with respect
to such Citadel Proceeding.
"Nationwide Agreement" has the meaning specified in the recitals to
this Agreement, as any document, instrument or agreement comprising the
Nationwide Agreement may from time to time be amended, modified or
supplemented, and any agreement or other document or instrument pursuant
to which any principal of or interest on or other amounts payable in
respect of indebtedness thereunder of SHC (or any successor Person to SHC
(whether by merger, consolidation, or acquisition of all or substantially
all of its assets)) may be renewed, extended, refinanced, restructured,
refunded or guaranteed, in each case as permitted in accordance with
Section 2.10(c) of this Agreement.
"Nationwide Event of Default" means an Event of Default as such term
may be defined in the Nationwide Agreement.
"Nationwide Indebtedness" means any and all indebtedness,
obligations and liabilities of SHC from time to time outstanding under the
Nationwide Agreement, in a principal amount not to exceed the amount
permitted pursuant to the last sentence of Section 7.3 of the Citadel
Agreement, whether now existing or hereafter arising, fixed or contingent,
due or not due, liquidated or unliquidated, determined or undetermined,
and whether for principal (subject to the aforesaid limitation), premium,
interest (including interest accruing before or after the commencement of
any Insolvency or Liquidation Proceeding or interest that would have
accrued but for the commencement of such Insolvency or Liquidation
Proceeding, to the date of payment, even if the claim for such interest is
not allowed pursuant to Applicable Law), fees, indemnities, costs,
expenses or otherwise.
"Petitioning Creditor" with respect to any Insolvency or Liquidation
Proceeding means each of the creditors that filed the petition to commence
or otherwise commenced such Insolvency or Liquidation Proceeding.
"Reading" means Reading Entertainment, Inc., a Nevada corporation,
and its successors.
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"Retained Claims" has the meaning specified in Section 2.11(h)
hereof.
"SHC" has the meaning specified in the preamble to this Agreement.
"Subordinated Documents" means the Citadel Agreement and the Note
(if and when executed) and all other promissory notes and other
instruments, agreements and documents executed at any time pursuant to the
Citadel Agreement or in connection therewith between SHC and Citadel,
including all other Related Documents, and all amendments, modifications,
supplements, extensions, renewals, restatements, refundings and
refinancings affecting the Citadel Agreement and all such other notes,
instruments, agreements and documents.
"Trigger Event" means the occurrence of any of the following events:
(a) An Insolvency or Liquidation Proceeding excluding such
Insolvency or Liquidation Proceeding caused by or in any way resulting
from a Tenant Event;
(b) Acceleration of the Nationwide Indebtedness;
(c) Acceleration of the Citadel Indebtedness as a result of a
Citadel Agreement Payment Default or a failure to make payment when due
under the Nationwide Agreement following the expiration of applicable
notice or grace period thereunder; or
(d) The occurrence of an Event of Default under the Citadel
Agreement pursuant to Section 9.1(c) thereof arising as a result of a
default by SHC under any of Section 6.8, 6.9, 7.1, 7.2, 7.3, 7.4, 7.5,
7.7, 7.9, 7.11, 7.12 or 7.13 thereof.
Section 1.02 Construction. References herein to the plural form include
the singular, and the singular include the plural; the word "including" is not
limiting; and the word "or" is not exclusive. The words "hereof", "wherein",
"hereby", and "hereunder" refer to this Agreement as a whole and not to any
particular provision of this Agreement. Article, section, exhibit and schedule
references are to articles and sections of, and exhibits and schedules to, this
Agreement, unless otherwise expressly indicated.
ARTICLE II
TERMS OF SUBORDINATION
Section 2.0 Subordination of Indebtedness. Citadel, for itself and its
successors and assigns, hereby agrees that (a) to the extent and in the manner
provided in this Agreement, and under
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the circumstances provided in Sections 2.02 and 2.04 hereof, the Citadel
Indebtedness is hereby expressly made subordinate and subject in right of
payment to the prior payment in full of all Nationwide Indebtedness, (b) the
subordination provided herein is for the benefit of Nationwide and its permitted
successors and assigns, (c) Nationwide shall be deemed to have extended or
acquired the Nationwide Indebtedness, whether now outstanding or hereafter
created, incurred, assumed or guarantied, in reliance upon the covenants and
provisions contained in this Agreement, and (d) the provisions of this Agreement
apply notwithstanding anything to the contrary in the Subordinated Documents.
Notwithstanding anything contained herein or in any other document related
hereto to the contrary, however, in no event shall the Citadel Indebtedness be
subordinate to a principal amount of Nationwide Indebtedness which exceeds the
amount permitted pursuant to the last sentence of Section 7.3 of the Citadel
Agreement.
Section 2.0 No Payment on Citadel Indebtedness in Certain Circumstances.
(a) Upon the maturity of any Nationwide Indebtedness, whether at the
final maturity thereof, by lapse of time, acceleration or otherwise
(including the scheduled time of payment (including any mandatory
prepayment) of any principal or interest), all principal thereof that is
then due and payable (up to the amount permitted pursuant to the last
sentence of Section 7.3 of the Citadel Agreement) and interest thereon and
interest thereafter accruing pursuant to the terms of the Nationwide
Agreement (including interest that would have accrued but for the
commencement of any Insolvency or Liquidation Proceeding) and other
amounts constituting Nationwide Indebtedness that are then due and payable
or thereafter accruing in accordance with the Nationwide Agreement and, to
the extent so provided for therein or otherwise permitted by law, interest
on such other amounts shall first be Fully Paid, before any payment or
distribution is made by SHC on account of the Citadel Indebtedness.
(b) Upon the occurrence and during the continuation of a Nationwide
Event of Default, no direct or indirect payment or distribution shall be
made by SHC on account of any Citadel Indebtedness, for a period (the
"Blockage Period") beginning on the date of the occurrence of the
Nationwide Event of Default in question and ending upon the earliest to
occur of the following: (i) when such Nationwide Event of Default shall
have been cured by SHC or waived in writing by Nationwide, (ii) when
Nationwide shall have waived in writing the application of this Section
2.02(b) to such Nationwide Event of Default, or (iii) when the Nationwide
Indebtedness is Fully Paid.
(c) Except as expressly prohibited in paragraphs (a) and (b) of this
Section 2.02, nothing contained herein or in any other document or
agreement shall prohibit or restrict SHC from paying the Citadel
Indebtedness as and when due.
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(d) If Citadel shall have received any payment or distribution in
contravention of the provisions of paragraph (a) or (b) of this Section
2.02, such payment or distribution shall be held in trust for Nationwide
and shall be promptly paid over to Nationwide for application to the
payment of the Nationwide Indebtedness, until any of the events described
in Sections 2.02(b)(i), 2.02(b)(ii) and 2.02(b)(iii) shall have occurred.
(e) Each of the Creditors shall give prompt notice to the other
Creditor of the occurrence and the type of any Nationwide Event of Default
or Citadel Event of Default, as the case may be, or if a payment or
distribution would constitute or result in a Nationwide Event of Default
or Citadel Event of Default, as the case may be. Nationwide shall confirm
in writing, in response to a written request from Citadel or any of its
Affiliates, whether or not Nationwide shall have received payment from SHC
of any obligation of SHC to Nationwide specified in such request. If such
confirmation is not provided within ten (10) Business Days following
Nationwide's receipt thereof, the requesting party can assume that such
payment(s) had not been made. Failure to give any of such notices in the
foregoing sentences shall not affect the subordination of the Citadel
Indebtedness to the Nationwide Indebtedness as provided herein.
(f) The provisions of this Section 2.02 shall not modify or limit in
any way the application of Section 2.04.
Section 2.03. Actions in Respect of Citadel Indebtedness.
(a) Subject in all cases to the terms of this Agreement, Citadel may
(1) accelerate the Citadel Indebtedness in accordance with the terms of
the Subordinated Documents; (2) file a claim in respect of the Citadel
Indebtedness in any Insolvency or Liquidation Proceeding; and (3) take all
other action necessary to enforce and protect its rights with respect to
the Citadel Indebtedness.
(b) In the event of a Citadel Agreement Payment Default, Citadel is
entitled to exercise all rights and remedies pursuant to the terms of the
Citadel Agreement and the Subordinated Documents. In the event of a
Citadel Event of Default other than a Citadel Agreement Payment Default,
Citadel is entitled to exercise all rights and remedies pursuant to the
terms of the Citadel Agreement and the Subordinated Documents following
the earliest to occur of the following: (i) Nationwide has waived this
provision in writing; (ii) the Nationwide Indebtedness is Fully Paid;
(iii) the Nationwide Indebtedness is accelerated; and (iv) the expiration
of ninety (90) days from the occurrence of the Citadel Event of Default in
question. If the Citadel Event of Default in question is cured within the
time period set forth in clause (iv) of this paragraph (b) and prior to
the occurrence of the event described in clause (i), (ii) or (iii) above,
then, for all purposes of this Agreement, such Citadel Event of Default
shall be deemed never to have existed. Nothing contained in this Section
2.03 shall
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in any way affect the rights and remedies of the parties contained in the
other provisions of this Agreement in the event of an Insolvency or
Liquidation Proceeding.
(c) Notwithstanding anything contained herein to the contrary,
Nationwide, for itself and its successors and assigns, agrees that (i) it
will not voluntarily release, subordinate or surrender, or, except in
connection with an assignment of the Nationwide Indebtedness, sell or
exchange, its Lien on the Equity Collateral unless and until the
Nationwide Indebtedness shall have been Fully Paid or Citadel shall have
given its prior consent to such release, and (ii) if Citadel shall be
subrogated to the rights and interests of Nationwide pursuant to Section
2.06 hereof or shall acquire the Nationwide Indebtedness pursuant to
Section 2.11(h) hereof, Nationwide shall assign to Citadel, without
recourse to, or representation or warranty by, Nationwide, Nationwide's
Lien on the Equity Collateral and the Borrower Collateral to the extent of
such Lien.
Section 2.04 Subordination on Dissolution, Liquidation or Reorganization
of SHC. In the event of any Insolvency or Liquidation Proceeding:
(a) Unless Nationwide agrees to a different treatment with respect
to its claim for the Nationwide Indebtedness (as to which Nationwide shall
have absolutely no obligation), upon any distribution of assets of SHC of
any kind or character, whether in cash, securities or other property,
arising out of such Insolvency or Liquidation Proceeding, all Nationwide
Indebtedness shall be Fully Paid before Citadel is entitled to receive any
payment or distribution on account of any Citadel Indebtedness;
(b) Any payment or distribution of assets of SHC of any kind or
character, whether in cash, securities or other property (including any
such payment or distribution which may be payable or deliverable by reason
of the payment of any other indebtedness of SHC being subordinated to the
Citadel Indebtedness), to which Citadel would be entitled except for the
provisions of this Section 2.04, shall be paid by SHC, as debtor in
possession, or any bankruptcy trustee or other agent or other Person
making such payment or distribution directly to Nationwide, until all
Nationwide Indebtedness remaining unpaid is Fully Paid, after giving
effect to any concurrent payments or distributions to or for Nationwide
for application to the payment of the Nationwide Indebtedness, or any of
the events described in Section 2.02(b)(i), (ii) or (iii) shall have
occurred; and
(c) If, notwithstanding the foregoing provisions of this Section
2.04, Citadel shall have received any payment or distribution of assets of
SHC, or the estate created by the commencement of any such Insolvency or
Liquidation Proceeding, of any kind or character in respect of the Citadel
Indebtedness, whether in cash, securities or other property, before all
Nationwide Indebtedness shall have been Fully Paid, such payment or
distribution shall be received and held in trust for Nationwide, and shall
promptly be paid over or delivered to
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Nationwide, for the benefit of Nationwide, until all Nationwide
Indebtedness then remaining unpaid is Fully Paid, after giving effect to
any concurrent payments or distributions to or for Nationwide for
application to the Nationwide Indebtedness, or any of the events described
in Section 2.02(b)(i), (ii) or (iii) shall have occurred.
Section 2.05. Liens. The Liens on the Collateral in favor of Citadel shall
be subject and subordinate in all respects to the Liens in favor of Nationwide.
Section 2.06 Citadel to Be Subrogated to Rights of Nationwide. Only after
the Nationwide Indebtedness shall have been Fully Paid, Citadel, to the extent
of any payments or distributions of cash, securities and other assets with
respect to the Citadel Indebtedness made to or for Nationwide pursuant to this
Agreement, shall be subrogated to the rights of Nationwide to receive any and
all payments or distributions of cash, securities and other assets payable with
respect to the Nationwide Indebtedness until all amounts owing on the Citadel
Indebtedness shall have been paid in full. For the purpose of such subrogation,
no such payments or distributions to or for Nationwide that otherwise would have
been made to Citadel but for this Agreement shall, as between SHC and Citadel,
be deemed to be payment by SHC on account of the Citadel Indebtedness; provided,
however, that (x) unless and until, as between Nationwide and Citadel, the
Nationwide Indebtedness is Fully Paid, Citadel shall not have the right, ability
or power to exercise any rights or remedies in respect of or by reason of such
subrogation and (y) such rights of subrogation, and any claims of Citadel with
respect thereto, are nevertheless limited by and subject to Section 11.12 of the
Citadel Agreement.
Section 2.07. Relative Rights. (a) This Agreement defines the relative
rights of Citadel, on the one hand, and Nationwide, on the other hand. Nothing
in this Agreement is intended to or shall:
(i) impair, as between SHC and Citadel, the obligation of SHC
to pay the amounts payable with respect to the Citadel Indebtedness as and
when the same shall become due and payable in accordance with its terms;
or
(ii) affect the relative rights against SHC of Citadel and
creditors of Citadel other than Nationwide.
(b) Notwithstanding anything herein or elsewhere to the contrary, if
SHC fails, because of this Agreement or otherwise, to pay principal of or
interest on the Citadel Indebtedness on the due date thereof, such failure
shall still be considered an Event of Default under paragraph (a) of
Section 9.1 of the Citadel Agreement except as otherwise provided in said
paragraph (a).
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Section 2.08 Continued Effectiveness of this Agreement.
(a) The terms of this Agreement, the subordination effected hereby,
and the rights of Nationwide and the obligations of Citadel arising
hereunder, shall not be affected, modified or impaired in any manner or to
any extent by: (i) any amendment, modification or termination of or
supplement to the Nationwide Indebtedness or the Nationwide Agreement, or
any agreement, instrument or document executed or delivered pursuant
thereto; (ii) the validity or enforceability of any such document; (iii)
the release, sale, exchange or surrender, in whole or in part, of any
collateral security, now or hereafter existing, for any of the Nationwide
Indebtedness or any other indebtedness, liability or obligations of SHC to
Nationwide, now existing or hereafter arising; (iv) any exercise or
non-exercise of any right, power or remedy under or in respect of the
Nationwide Indebtedness or any of such instruments and documents referred
to in clause (i) above or arising at law; or (v) any waiver, consent,
release, indulgence, extension, renewal, modification, delay or other
action, inaction or omission in respect of the Nationwide Indebtedness or
any of the agreements, instruments or documents referred to in clause (i)
above or in respect of any collateral security for the Nationwide
Indebtedness or any other indebtedness, liability or obligation of SHC to
Nationwide, now existing or hereafter arising, all whether or not Citadel
shall have had notice or knowledge of any of the foregoing and whether or
not Citadel shall have consented thereto.
(b) The terms of this Agreement, and the rights of Citadel and the
obligations of Nationwide arising hereunder, shall not be affected,
modified or impaired in any manner or to any extent by: (i) any amendment,
modification or termination of or supplement to the Citadel Indebtedness
or the Subordinated Documents, or any agreement, instrument or document
executed or delivered pursuant thereto; (ii) the validity or
enforceability of any such document; (iii) the release, sale, exchange or
surrender, in whole or in part, of any collateral security, now or
hereafter existing, for any of the Citadel Indebtedness or any other
indebtedness, liability or obligations of SHC to Citadel, now existing or
hereafter arising; (iv) any exercise or non-exercise of any right, power
or remedy under or in respect of the Citadel Indebtedness or any of such
instruments and documents referred to in clause (i) above or arising at
law; or (v) any waiver, consent, release, indulgence, extension, renewal,
modification, delay or other action, inaction or omission in respect of
the Citadel Indebtedness or any of the agreements, instruments or
documents referred to in clause (i) above or in respect of any collateral
security for the Citadel Indebtedness or any other indebtedness, liability
or obligation of SHC to Citadel, now existing or hereafter arising, all
whether or not Nationwide shall have had notice or knowledge of any of the
foregoing and whether or not Nationwide shall have consented thereto.
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Section 2.09 Provisions to Effectuate Subordination of Citadel
Indebtedness.
(a) In the event of any Insolvency or Liquidation Proceeding,
Nationwide is irrevocably authorized and empowered, in its discretion, to
make and present for and on behalf of Citadel such proofs of claim against
SHC on account of the Citadel Indebtedness or other motions or pleadings
as Nationwide may deem expedient or proper, to vote such proofs of claim
in any such Insolvency or Liquidation Proceeding, to the extent permitted
by law, and to receive and collect any and all payments or distributions
made thereon in whatever form and to apply such payments or distributions
on account of any of the Nationwide Indebtedness. Citadel irrevocably
authorizes and empowers Nationwide to demand, ▇▇▇ for, collect and receive
each of such payments and distributions and to file claims and take such
other actions, in the name of Nationwide or Citadel or otherwise, as
Nationwide may deem necessary or advisable for the enforcement of this
Agreement. To the extent that payments or distributions are made in
property other than cash, Citadel authorizes Nationwide to sell such
property to such buyers and on such terms as Nationwide, in its reasonable
discretion, shall determine. Citadel will execute and deliver to
Nationwide such powers of attorney, assignments and other instruments or
documents as may be requested by Nationwide in order to enable Nationwide
to enforce any and all claims upon or with respect to the Citadel
Indebtedness and to collect and receive any and all payments and
distributions which may be payable or deliverable at any time with respect
thereto.
(b) Nationwide agrees that it will not exercise any of the rights or
remedies under paragraph (a) of this Section 2.09 unless Citadel has
failed to implement any action in question within ten (10) days prior to
when such action is required pursuant to an Insolvency or Liquidation
Proceeding.
(c) Citadel specifically waives: unless Nationwide shall otherwise
give its prior written consent or the Nationwide Indebtedness is Fully
Paid, (i) the right to seek to give its credit (secured or otherwise) to
SHC in any way under Section 364 of the Bankruptcy Code unless the same is
subordinated in all respects to the Nationwide Indebtedness in accordance
with the terms and conditions of this Agreement; (ii) the right to take a
position inconsistent with or contrary to that of Nationwide (including a
position by Nationwide to take no action) if SHC seeks to use, sell or
lease the Collateral under Section 363 of the Bankruptcy Code or seeks to
accept or reject any executory contract or lease under Section 365 of the
Bankruptcy Code; (iii) the right to receive any collateral (including any
"super priority" or equal or "priming" or replacement Lien) for the
Citadel Indebtedness, other than the Equity Collateral and the Borrower
Collateral, in each case subject to Nationwide's Liens thereon to the
extent provided herein; and (iv) the right to seek adequate protection in
respect of the Collateral under Section 363 or 361 of the Bankruptcy Code,
unless and then only to the extent that
12
Nationwide does and then only to the extent consistent with the
subordinated position of Citadel.
Section 2.10 Subordination not Impaired by Acts or Omissions of SHC or
Nationwide. (a) No right of Nationwide to enforce subordination as provided
herein shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of SHC or, except as provided in Section 2.10(c), by
any act or failure to act by Nationwide, or by any noncompliance by SHC with the
provisions and covenants of the Nationwide Agreement or the Subordinated
Documents, regardless of any knowledge thereof that Nationwide may have or be
otherwise charged with and regardless of whether such action or failure to act
diminishes or destroys any subrogation or other rights that Citadel may have or
reduces or eliminates any eventual recovery in respect of the Citadel
Indebtedness. Without in any way limiting the generality of the foregoing,
Nationwide may, at any time and from time to time, without the consent of or
notice to Citadel, except as provided in Section 2.10(c), without incurring
responsibility to Citadel and without impairing or releasing the subordination
and other benefits provided in this Agreement or the obligations hereunder of
Citadel to Nationwide, do any one or more of the following even if any right to
reimbursement or subrogation or other right or remedy of Citadel is affected,
impaired or extinguished thereby:
(i) change the manner, place or terms of payment or extend,
renew, modify or amend the terms of the Nationwide Indebtedness or any
agreement or instrument evidencing, securing or guarantying any Nationwide
Indebtedness (including increasing the amount of principal, changing the
time and amount of repayments, increasing the rate of interest or
otherwise changing the terms of the Nationwide Agreement), exercise or
delay in or refrain from exercising any right or remedy against SHC and
otherwise deal freely with SHC or any liability of SHC;
(ii) release, exercise or delay in or refrain from exercising
any right or remedy against, change the terms of any agreement or
instrument with or otherwise deal freely with any guarantor or any other
Person liable or contingently liable in any manner for the Nationwide
Indebtedness or any such liability or contingent liability;
(iii) settle or compromise any of the Nationwide Indebtedness
or any other liability of SHC or any guarantor of the Nationwide
Indebtedness to Nationwide and apply any sums by whomsoever paid and
however realized to any liability (including, without limitation, the
Nationwide Indebtedness) in any manner or order; and
(iv) fail to take or to record or otherwise perfect, for any
reason or for no reason, any Lien securing the Nationwide Indebtedness by
whomsoever granted, and release, sell, exercise or delay in or refrain
from exercising any right or remedy against, exchange, enforce, realize
upon, or otherwise deal freely with, in any manner and in any order, any
of the Collateral.
13
(b) Except as provided in Section 2.10(c), Citadel hereby waives any
and all notice of the creation, modification, renewal, extension or
accrual of any Nationwide Indebtedness and notice of or proof of reliance
by Nationwide upon this Agreement, and the Nationwide Indebtedness shall
conclusively be deemed to have been created, contracted or incurred in
reliance upon this Agreement, and all dealings between SHC and Nationwide
shall be deemed to have been consummated in reliance on this Agreement.
(c) Notwithstanding anything contained in this Agreement or any
other agreement to the contrary, the consent of Citadel shall be required
for (i) any amendment or modification of the Nationwide Agreement (any of
the foregoing being a "Change") (A) changing the dates of payment of
interest, principal, fees or costs in respect of the Nationwide
Indebtedness or shortening the maturity of or requiring the earlier
payment of any principal or interest in respect of the Nationwide
Indebtedness, (B) increasing the rate of interest or the amount of any
payments (including the amount of any fees payable in respect of the
Nationwide Indebtedness), except for the increase in rate provided for
therein following maturity thereof, whether at stated maturity, by
acceleration or otherwise, or (C) adding any requirement for SHC to pay
any additional fees in respect of the Nationwide Indebtedness, or (ii) any
Change making any material terms and conditions of the Nationwide
Agreement more restrictive or burdensome on SHC than the terms and
conditions of the Nationwide Agreement delivered to Citadel and in effect
on the date hereof. If any Change is made in contravention of this Section
2.10(c), any additional liabilities or obligations to Nationwide imposed
thereby on SHC shall not constitute obligations secured by the Collateral
and, with respect to such additional liabilities or obligations,
Nationwide shall not be entitled to any of the benefits of this Agreement,
the Security Agreement or the Pledge Agreement.
Section 2.11 Additional Agreements and Waivers.
(a) Citadel hereby waives (i) any requirement for marshaling of
assets by Nationwide in connection with any foreclosure of the Liens of
Nationwide on any Collateral or any other realization upon such
Collateral, and (ii) any other principle of election of remedies.
(b) Nationwide shall not have any obligation or duty, nor shall
Citadel have any right to direct Nationwide, to retain, perfect, protect
or release any Collateral (except as provided in Section 2.03(c)), to
foreclose or refrain from foreclosing the Lien of Nationwide on any
Collateral, to act or refrain from acting with respect to any Nationwide
Event of Default, to act or refrain from acting with respect to the
collection of any claim from any account debtor, guarantor or any other
party, to realize upon any collateral or otherwise to
14
exercise or refrain from exercising any rights or remedies in respect of
such Lien or such Collateral. Except with respect to a violation of
Section 2.03(c), Nationwide shall not be subject to any liability on
account of taking or refraining from taking any action referred to in this
Section 2.11(b), and Citadel waives and agrees to refrain from asserting
against Nationwide any claim seeking damages or other relief by way of
specific performance, injunction or otherwise, with respect to any action
taken or not taken by Nationwide with respect to SHC, the Collateral or
any other Person. Without limiting the foregoing, Citadel waives the right
to commence or pursue any legal action on account of the exercise or
non-exercise of rights, remedies or other conduct of Nationwide under the
Nationwide Agreement or any document entered into in connection therewith,
including allegations based on a theory of breach of fiduciary obligations
of Nationwide, duty of care, duty of good faith, duty of reasonableness,
negligence, equitable subordination of claims, interference with
contractual relationships, conflicts of interest or otherwise, except for
willful misconduct by Nationwide or a violation of Section 2.03(c) hereof.
(c) Solely between Nationwide and Citadel, Citadel assumes
responsibility for keeping itself informed as to the condition (financial
or otherwise), business, assets and operations of SHC, the condition of
the Collateral and all other circumstances that might in any way affect
Citadel's risk under the Subordinated Documents and this Agreement
(including without limitation the risk of non-payment of the Nationwide
Indebtedness), and Nationwide shall have no duty or obligation whatsoever
to obtain or disclose to Citadel any information or documents relative to
such condition (financial or otherwise), business, assets or operations of
SHC, such Collateral or such risk, whether acquired by Nationwide in the
course of its relationship with SHC or otherwise. The terms of this
Section 2.11(c) shall not impair or affect SHC's obligations arising under
any Credit Agreement or any of the Subordinated Documents.
(d) Citadel agrees that the subordination hereunder applies
regardless of the validity or enforceability of the Nationwide
Indebtedness or the Nationwide Agreement or the validity, perfection or
enforceability of the Liens securing the Nationwide Indebtedness.
(e) Citadel agrees not to (i) take any action to challenge the
validity, enforceability or amount of any guaranty of the Nationwide
Indebtedness given by any other Person, (ii) induce any other Person to
take such action, or (iii) cooperate with any other Person in taking such
action.
(f) Within fifteen (15) days following the written request from
Nationwide or SHC, Citadel shall deliver to SHC and Nationwide an estoppel
certificate setting forth (i) the amount of principal and interest then
due, if any, and other amounts then payable (to the extent then
ascertainable), if any, in respect of the Citadel Indebtedness and (ii)
whether or not the Subordinated Documents have been amended since the date
hereof or the date of the
15
last such certificate delivered pursuant hereto, as the case may be, and
if so, providing a copy of the relevant amendment documents.
(g) Within fifteen (15) days following the written request from
Citadel, each of Nationwide and SHC shall deliver to Citadel an estoppel
certificate setting forth (i) the amount of principal and interest then
due, and other amounts then payable (to the extent ascertainable), in
respect of the Nationwide Indebtedness and (ii) whether or not the
Nationwide Agreement has been amended since the date hereof or the date of
the last such certificate delivered pursuant hereto, as the case may be,
and, if so, providing a copy of the relevant amendment documents.
Nationwide confirms that, as of the date hereof, the outstanding principal
sum of the Nationwide Indebtedness is eleven million Dollars
($11,000,000), and no other sums are now accrued or payable under the
Nationwide Agreement except accrued interest, not currently due, in
accordance with the terms of the Nationwide Agreement.
(h) (i) At any time following a Trigger Event, upon the request of
Citadel and upon at least five (5) Business Days' prior written notice to
Nationwide, Nationwide will assign to Citadel, without any recourse to, or
representation or warranty by, Nationwide, the Nationwide Agreement (other
than Nationwide's claims, if any, in respect of interest and other fees
and costs thereunder, to the extent not included in the Nationwide
Accrual) (the "Retained Claims"), which Retained Claims shall be retained
by and remain the property of Nationwide) upon the payment to Nationwide,
or as it may direct in writing, of the sum of (x) the principal amount of
the Nationwide Indebtedness or $11,000,000, whichever is less, and (y) the
Nationwide Accrual; provided, however, that the Nationwide Indebtedness
and the Nationwide Agreement, as assigned, will then be subject to Section
11.12 of the Citadel Agreement. Upon such assignment, this Agreement shall
terminate and all rights and obligations between Nationwide and Citadel
shall terminate, except as provided in this Section 2.11(h). Upon such
assignment, the combined assigned Nationwide Indebtedness and the Citadel
Indebtedness shall be treated for purposes of this Agreement as if such
combined Indebtedness were the Nationwide Indebtedness and the Retained
Claims shall be treated as if such Retained Claims were the Citadel
Indebtedness; provided, however, that nothing herein shall affect, limit
or impair the right of Nationwide to enforce, collect and retain free from
any limitations or restrictions of this Agreement payment of the Retained
Claims from any Person other than SHC.
(ii) At Citadel's election, payment to Nationwide or an Affiliate
thereof for the amount required to be paid pursuant to subsection
2.11(h)(i) may be made by it or an Affiliate making and delivering a note
for the full amount due, payable in full ninety (90) days from its date,
with interest thereon payable at the rate of 8.25% monthly in arrears and
on the date of payment in full (increasing to 9.75% following maturity
thereof, whether at stated maturity, by acceleration or otherwise);
provided, however, that Nationwide (or such
16
Affiliate) may require that the maturity date of the note be extended to
such later date, not beyond the expiration of the Initial Term of the
Lease Agreement as may be requested by Nationwide (or such Affiliate) in a
notice given to Citadel not later than sixty (60) days prior to the
originally stated maturity date of such note, in which case the maker of
the note and, if applicable, the guarantor thereof shall execute and
deliver such additional documents to confirm such extension as may be
appropriate. Such note, if made by an Affiliate of Citadel, shall be fully
guaranteed as to payment by Citadel, or may in the first instance be made
by Citadel (in which case no guaranty shall be required). The note and, if
applicable, the guaranty shall be on terms and conditions reasonably
satisfactory to Nationwide. The option provided herein in favor of Citadel
to pay through delivery of a note and, if applicable, a guaranty shall not
be available in connection with the exercise of the Purchase Option
pursuant to the Lease Agreement and any such note shall be pre-payable in
full upon the closing pursuant to the Purchase Option or the purchase or
other acquisition by Citadel (or an Affiliate) of the Membership Interest
in SHC.
(iii) Upon the payment to Nationwide of the amount required to
be paid to it pursuant to subsection 2.11(h)(i) (whether in cash or by the
making and delivery of a note and, if applicable, a guaranty), Nationwide
shall, as Citadel may request, either satisfy or assign (without recourse
to, or representation or warranty by, Nationwide) as Citadel shall direct
any and all Liens securing the Nationwide Indebtedness and any claims
(other than the Retained Claims) with respect thereto; provided, however,
that such Liens and claims, if so assigned, will be subject to the
limitations of Section 11.12 of the Citadel Agreement. Any and all
Retained Claims shall be unsecured claims and any judgment thereon shall
not be enforced against or be or become Liens on any assets of SHC.
(iv) If the Trigger Event is a Citadel Proceeding and if a Bad
Faith Determination is entered with respect thereto, then Citadel shall be
liable: (x) to Nationwide, for all costs and expenses (including
reasonable fees and expenses of counsel and other professional advisors)
incurred by Nationwide in connection with the Citadel Proceeding and in
seeking such Bad Faith Determination and for interest (at the
Reimbursement Rate) on any taxes paid by Nationwide as a result of the
transfer or repayment of the Nationwide Indebtedness for the period from
the date such taxes were paid until the date such taxes would have been
paid if the Nationwide Indebtedness had been repaid at the maturity date
thereof; and (y) to SHC and its Affiliates, for all costs and expenses
(including reasonable fees and expenses of counsel and other professional
advisors) incurred by SHC and its Affiliates in connection with the
Citadel Proceeding and in seeking such Bad Faith Determination. If
following the initiation of a Citadel Proceeding either Nationwide or any
of its Affiliates or SHC or any of its Affiliates, or any other Person
acting in concert with or with the support of any of them, unsuccessfully
asserts a claim for a Bad Faith Determination, then Nationwide (if it or
any of its Affiliates asserted such claim) or ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇ (if SHC or any of its Affiliates asserted such claim) shall be
17
liable to Citadel for all costs and expenses (including reasonable fees
and expenses of counsel and other professionals) incurred by Citadel in
defending against the claim for a Bad Faith Determination.
Section 2.12. Transferees of Creditors; Notice of Subordination.
(a) Each Creditor shall not at any time sell, assign, pledge,
hypothecate, or otherwise transfer its Credit Agreement (or any of its
respective rights or interests therein), unless and until the transferee,
pledgee, or other appropriate party shall have assumed in a writing,
reasonably satisfactory to the other, all of the transferring, pledging,
or hypothecating Creditor's obligations under this Agreement.
(b) Each Creditor warrants and represents to the other Creditor that
it has not previously assigned any interest in its respective
Indebtedness, that no party owns an interest in its Indebtedness other
than itself and that its entire Indebtedness is owing only to it. Each
Creditor covenants that its entire Indebtedness shall continue to be owing
only to it, unless assigned or transferred in accordance with the terms of
this Agreement.
Section 2.13. Representations and Warranties. (a) Each Creditor hereby
represents and warrants for the benefit of the other as follows: (i) the
execution, delivery and performance of this Agreement are within its corporate
power and authority and have been duly authorized by all necessary corporate
action and this Agreement constitutes the legal, valid and binding obligation of
each Creditor enforceable against it in accordance with its terms, except as
enforceability may be limited by equitable principles or by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally; and (ii) all consents for, in the case of
Nationwide, the amending of the Existing Nationwide Agreement to the Nationwide
Agreement and, in the case of Citadel, the funding to SHC pursuant to the
Citadel Agreement have been obtained and are in effect (or will be obtained and
in effect upon the date of funding).
(b) Nationwide hereby represents to Citadel that, upon the tender in
cash of the amount of the Nationwide Indebtedness in the amount and
subject to the conditions set forth in Section 2.11(h)(i) hereof, the
assignment provided for in said Section 2.11(h)(i) will be provided
whether or not Nationwide is then the holder of the Nationwide
Indebtedness.
Section 2.14. Restriction on Amendments to Subordinated Documents. Neither
SHC nor Citadel shall, without the prior written consent of Nationwide, waive,
amend or modify any of the terms and conditions of any Subordinated Document if
the effect of such waiver, amendment or modification is to (a) advance maturity
dates, (b) increase rates or amounts of payments, (c) change any provision
herein, or (d) otherwise make any such terms and conditions more restrictive or
burdensome on SHC than the terms and conditions of the Subordinated Documents
delivered to Nationwide and in effect on the date hereof or at the time of such
amendment or modification.
18
Section 2.15. Continuing Agreement of Subordination. This is a continuing
agreement of subordination and Nationwide may continue, at any time and without
notice to Citadel, to extend credit or other financial accommodations to or for
the benefit of SHC in reliance hereon. This Agreement shall be effective and may
not be terminated or otherwise revoked by Citadel until the Nationwide
Indebtedness has been Fully Paid. If Citadel shall have any right under
Applicable Law or otherwise to terminate or revoke this Agreement which cannot
be waived, then, to the extent permitted by law, such termination or revocation
shall not be effective until written notice of such termination or revocation,
signed by Citadel, is given to the holder of such Nationwide Indebtedness. Any
such termination or revocation shall not affect this Agreement in relation to
(a) any Nationwide Indebtedness which arose prior to the receipt thereof, or (b)
any of the Nationwide Indebtedness created after receipt thereof, if such
Nationwide Indebtedness was incurred either through committed advances or
re-advances by Nationwide pursuant to the Nationwide Agreement.
Section 2.16. Further Assurances.
(a) Upon the occurrence and during the continuation of a Nationwide
Default, Citadel shall duly and promptly take such action as Nationwide
may reasonably request (a) to collect the Citadel Indebtedness for the
account of Nationwide and to file appropriate claims or proofs of claims
in respect of the Citadel Indebtedness, (b) to execute and deliver to
Nationwide such assignments or other instruments as Nationwide may
reasonably request in order to enable it to enforce any and all claims
with respect to the Citadel Indebtedness and any security interests
securing payment of the Citadel Indebtedness, and (c) to collect and
receive any and all payments or distributions which may be payable or
deliverable with respect to the Citadel Indebtedness.
(b) Nothing contained in this Agreement shall affect Citadel's
obligations to make any advances pursuant to the terms of the Citadel
Agreement.
ARTICLE III
MISCELLANEOUS
Section 3.01 Amendments, Etc. No amendment, waiver or modification of any
provision of this Agreement, nor consent to any departure by any party hereto
therefrom, shall in any event be effective unless the same shall be in writing,
making specific reference to this Agreement and such amendment, waiver,
modification or consent shall be consented to in one or more writings signed by
or consented to by all the parties hereto, and then such amendment, waiver,
modification or consent shall be effective only in the specific instance and for
the specific purpose for which given.
Section 3.02 Notices, Etc. All notices, offers, acceptances, approvals,
waivers, requests, demands and other communications required or permitted
hereunder or under any other instrument,
19
certificate or other document delivered in connection with the transactions
described herein shall be in writing, shall be addressed as provided below and
shall be considered as properly given (a) if delivered in person, (b) if sent by
express courier service (including, without limitation, Federal Express, ▇▇▇▇▇,
DHL, Airborne Express, and other similar express delivery services), (c) in the
event overnight delivery services are not readily available, if mailed by United
States Postal Service, postage prepaid, registered or certified with return
receipt requested, or (d) if sent by telecopy and confirmed; provided, that in
the case of a notice by telecopy, the sender shall in addition confirm such
notice by writing sent in the manner specified in clause (a), (b) or (c) of this
Section 3.02. All notices shall be effective upon receipt by the addressee;
provided, however, that if any notice is tendered to an addressee and the
delivery thereof is refused by such addressee, such notice shall be effective
upon such tender. For the purposes of notice, the addresses of the parties shall
be as set forth below; provided, however, that any party shall have the right to
change its address for notice hereunder to any other location by giving written
notice to the other party in the manner set forth herein. The initial addresses
of the parties hereto are as follows:
If to Citadel:
Reading International, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
with required copies to
S. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Reading International, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to SHC:
▇▇▇▇▇▇ Hill Capital, L.L.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
20
If to Nationwide:
Nationwide Theatres Corp.
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with required copies to
▇▇▇ ▇▇▇▇▇
Pacific Theatres
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Each such notice, request or other communication shall be effective when
actually received.
Section 3.03 No Waiver; Remedies. No failure on the part of any party
hereto to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
Section 3.04 Costs and Expenses. Each Creditor agrees to pay on demand all
costs and expenses of the other Creditor in connection with the successful
enforcement of this Agreement against the first Creditor (including without
limitation for reasonable fees and expenses of counsel).
Section 3.05 Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
Section 3.06 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 3.07 Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature
21
page to this Agreement by telecopier shall be effective as delivery of a
manually executed counterpart of this Agreement.
Section 3.08 Waiver of Jury Trial. THE PARTIES HERETO HEREBY IRREVOC"▇▇▇
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
Section 3.09 Evidence of Understanding. Citadel shall, promptly upon the
request of Nationwide, and Nationwide shall, promptly upon the request of
Citadel, execute and deliver such other documents and instruments as Nationwide
or Citadel, as the case may be, may deem reasonably necessary or appropriate (in
proper form for recording or filing, if requested) to more fully implement or
further evidence the understandings and agreements contained in this Agreement.
Section 3.10 Conflict of Provisions. In the event of any conflict between
any term, covenant or condition of this Agreement and any term, covenant or
condition of the Nationwide Agreement, the Subordinated Documents, or any
documents executed in connection therewith or the indebtedness evidenced
thereby, the provisions of this Agreement shall control and govern.
Section 3.11 Respective Rights. This Agreement sets forth the respective
rights of Citadel, on the one hand, and Nationwide, on the other hand, and, as
such, has not been entered into for the benefit of SHC and may not be enforced
by SHC. SHC is executing and delivering this Agreement solely to confirm to the
other parties that it is aware that such other parties have entered into this
Agreement and that it consents to the other parties' entering into this
Agreement (though the foregoing shall not imply that SHC's consent was or is
required for the execution and delivery of this Agreement by such other parties,
or that its obligations pursuant to the Nationwide Agreement or the Subordinated
Documents are affected in any way if an amendment is made hereto, or a waiver is
granted hereunder, without SHC's consent).
Section 3.12 Termination. This Agreement shall terminate upon payment in
full of the Nationwide Indebtedness and all other amounts due under the
Nationwide Agreement.
Section 3.13. Section Headings. The Section headings in this Agreement are
for convenience of reference only and shall not affect the interpretation
hereof.
Section 3.14. Limited Recourse. SHC's obligations hereunder are intended
to be the obligations of the limited liability company only and no recourse for
the payment of any amount due hereunder, or for any claim based thereon or
otherwise in respect thereof, shall
22
be had against any member of SHC or any incorporator, member, officer, director
or Affiliate, as such, past, present or future of such limited liability
company, it being understood that SHC is a limited liability company formed for
the purpose of the transactions involved in and relating to the Citadel
Agreement on the express understanding aforesaid. Nothing contained in this
Section shall be construed to limit the exercise or enforcement, in accordance
with the terms of this Agreement, of the rights and remedies against the limited
liability company or the assets of the limited liability company or affect
claims under Section 5 of the Pledge Agreement or under the Indemnity Guarantee
(as such terms are defined in the Citadel Agreement).
Section 3.15 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provisions in any other jurisdiction.
Section 3.16 Bankruptcy. This Agreement shall be applicable both before
and after the commencement, whether voluntary or involuntary, of any case under
the Bankruptcy Code (or similar state law) involving SHC, and all references
herein to SHC shall be deemed to apply to SHC as a debtor-in-possession and to
any trustee in bankruptcy for the estate of SHC.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
READING INTERNATIONAL, INC.
By:__________________________________
Name:
Title:
NATIONWIDE THEATRES CORP.,
By:__________________________________
Name:
Time:
▇▇▇▇▇▇ ▇▇▇▇ CAPITAL, L.L.C.,
By:__________________________________
Name:
Title:
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FOR PURPOSES OF THE LAST SENTENCE OF
SECTION 2.11(h)(iv) ONLY:
_________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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EXHIBIT H
THEATRE PROPERTIES
1. The Village East Cinemas located at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇
2. The ▇▇▇▇▇▇ Theatre located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇.
3. Cinemas 1, 2 and 3 located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
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EXHIBIT I
SITE LEASES
(a) That certain Indenture of Lease dated as of January 31, 1987 between Senyar
Holding Company, as landlord, and M-Square Theaters, Inc., as tenant, covering
premises at ▇▇▇-▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, containing the
Village East Theatre, as amended by that certain First Amendment to Lease, dated
as of June 15, 1989, between Senyar Holding Company and M-Square Theaters, Inc.
and the letter regarding notices, dated December 20, 1993 from Senyar Holding
Company to M-Square Theatres, Inc.;
(b) The ground lease dated February 9, 1961 between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, et al., as
landlord, and Turtle Bay Theatre Corporation, as tenant, covering premises at
1001, 1003 1005 and ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, containing
Cinemas 1, 2 and 3, the tenant's interest therein having been assigned to (i)
Sutcin Holding Corp. pursuant to that Assignment & Assumption of Lease dated
December 31, 1984 between Cinemas 5 Ltd., as successor in liquidation to Turtle
Bay Theatre Corporation, and Sutcin Holding Corp., and (ii) ▇▇▇▇▇▇ Hill
Associates pursuant to that Agreement of Purchase and Sale and related
Assignment of Lease, each dated July 3, 1986 between Sutcin Holding Corp. and
▇▇▇▇▇▇ ▇▇▇▇ Associates; and
(c) That certain Ground Lease dated as of August 16, 1985, between Sutcin
Holding Corp., as landlord, and ▇▇▇▇▇▇ Hill Associates, as tenant, covering the
premises at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, containing the
▇▇▇▇▇▇ Theater as amended by the First Addendum to Ground Lease, dated as of
January 1, 1992, between Sutcin Holding Corp. and ▇▇▇▇▇▇ Hill Associates, Second
Addendum to Ground Lease, dated as of January 1, 1995, between Sutcin Holding
Corp. and ▇▇▇▇▇▇ ▇▇▇▇ Associates, Third Addendum to Ground Lease, dated as of
July 1, 1996, between Nationwide (successor-in-interest to Sutcin Holding Corp.)
and ▇▇▇▇▇▇ Hill Associates, Fourth Addendum to Ground Lease, dated as of July
28, 2002, between Nationwide and ▇▇▇▇▇▇ ▇▇▇▇ Associates and Fifth Addendum to
Ground Lease, dated as of January 29, 2002 between Nationwide and ▇▇▇▇▇▇ Hill
Associates.
27