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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 1998
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________
---------------------
Commission file number: 1-9029
TRUMP'S CASTLE FUNDING, INC.
(Exact name of registrant as specified in its charter)
NEW JERSEY 11-2739203
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Huron Avenue and Brigantine Boulevard
Atlantic City, New Jersey 08401
(Address of principal executive offices) (Zip Code)
(609) 441-6060
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed
since last report)
Commission file number: 1-9029
TRUMP'S CASTLE ASSOCIATES, L.P.
(Exact name of registrant as specified in its charter)
NEW JERSEY 22-2608426
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Huron Avenue and Brigantine Boulevard
Atlantic City, New Jersey 08401
(Address of principal executive offices) (Zip Code)
(609) 441-6060
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed
since last report)
---------------------
Indicate by check mark whether the registrants (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrants were required to file such reports), and (2) have been subject to
such filing requirements for the past 90 days. Yes |X| No |_|
As of May 15, 1998, there were 200 shares of Trump's Castle Funding,
Inc.'s Common Stock, par value $.01 per share, outstanding.
Trump's Castle Funding, Inc. meets the conditions set forth in General
Instructions H(1)(a) and (b) of From 10-Q and is therefore filing this form with
the reduced disclosure format.
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<PAGE>
TRUMP'S CASTLE ASSOCIATES, L.P. AND SUBSIDIARY
INDEX TO FORM 10-Q
Page No.
--------
PART I - FINANCIAL INFORMATION
ITEM 1 - Financial Statements
Condensed Consolidated Balance Sheets of Trump's
Castle Associates, L.P. and Subsidiary as of
December 31, 1997 and March 31, 1998 (unaudited) ................... 1
Condensed Consolidated Statements of Operations of
Trump's Castle Associates, L.P. and Subsidiary for the
Three Months Ended March 31, 1997 and 1998 (unaudited) ............ 2
Condensed Consolidated Statement of Partners' Capital
of Trump's Castle Associates, L.P. and Subsidiary for
the Three Months Ended March 31, 1998 (unaudited) ................. 3
Condensed Consolidated Statements of Cash Flows of
Trump's Castle Associates, L.P. and Subsidiary for the
Three Months Ended March 31, 1997 and 1998 (unaudited) ............ 4
Notes to Condensed Consolidated Financial Statements
of Trump's Castle Associates, L.P. and Subsidiary (unaudited) ..... 5
ITEM 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations ............................... 7
ITEM 3 - Quantitative and Qualitative Disclosures About Market Risk ..... 9
PART II - OTHER INFORMATION
ITEM 1 - Legal Proceedings............................................... 10
ITEM 2 - Changes in Securities and Use of Proceeds....................... 11
ITEM 3 - Defaults Upon Senior Securities................................. 11
ITEM 4 - Submission of Matters to a Vote of Security Holders............. 11
ITEM 5 - Other Information............................................... 11
ITEM 6 - Exhibits and Reports on Form 8-K................................ 11
SIGNATURES
Signature - Trump's Castle Funding, Inc.................................. 13
Signature - Trump's Castle Associates, L.P............................... 14
i
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
TRUMP'S CASTLE ASSOCIATES, L.P. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
ASSETS
December 31, March 31,
1997 1998
----------- ----------
(unaudited)
CURRENT ASSETS:
Cash and cash equivalents ........................... $ 14,472 $ 22,331
Receivables, net .................................... 8,028 8,445
Inventories ......................................... 3,090 2,867
Other current assets ................................ 1,713 1,305
-------- --------
Total current assets .......................... 27,303 34,948
PROPERTY AND EQUIPMENT, NET ............................ 499,513 495,493
OTHER ASSETS ........................................... 14,590 15,116
-------- --------
Total assets .................................. $541,406 $545,557
======== ========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Current maturities-other borrowings ................. $ 7,954 $ 2,008
Accounts payable and accrued expenses ............... 25,742 30,482
Due to affiliates ................................... 23,949 20,023
Accrued interest payable ............................ 4,020 11,909
-------- --------
Total current liabilities ..................... 61,665 64,422
MORTGAGE NOTES
(Net of unamortized discount of $30,170
and $29,375, respectively) ......................... 211,971 212,766
PIK NOTES
(Net of unamortized discount of $7,197
and $7,107, respectively) .......................... 73,699 73,789
OTHER BORROWINGS ....................................... 55,673 60,683
OTHER LONG TERM LIABILITIES ............................ 4,730 7,449
-------- --------
Total liabilities ............................. 407,738 419,109
COMMITMENTS AND CONTINGENCIES
PARTNERS' CAPITAL ...................................... 133,668 126,448
-------- --------
Total liabilities and capital ................. $541,406 $545,557
======== ========
The accompanying notes are an integral part of these condensed consolidated
balance sheets.
1
<PAGE>
TRUMP'S CASTLE ASSOCIATES, L.P. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1998
(unaudited)
(in thousands)
Three Months
Ended March 31,
---------------
1997 1998
---- ----
REVENUES:
Gaming .............................................. $ 63,974 $ 62,613
Rooms ............................................... 3,937 3,557
Food and beverage ................................... 7,919 7,494
Other ............................................... 2,206 1,885
-------- --------
Gross revenues ................................... 78,036 75,549
Less-promotional allowances ............................ 9,612 8,946
-------- --------
Net revenues ........................................ 68,424 66,603
-------- --------
COST AND EXPENSES:
Gaming .............................................. 41,034 39,877
Rooms ............................................... 608 668
Food and beverage ................................... 2,123 1,832
General and administrative .......................... 16,173 15,009
Depreciation and amortization ....................... 5,041 4,050
-------- --------
Total costs and expenses ............................ 64,979 61,436
-------- --------
Income from operations ........................... 3,445 5,167
INTEREST INCOME ........................................ 69 228
INTEREST EXPENSE ....................................... (12,198) (12,615)
-------- --------
Net loss ............................................ $ (8,684) $ (7,220)
======== ========
The accompanying notes are an integral part of these condensed consolidated
statements.
2
<PAGE>
TRUMP'S CASTLE ASSOCIATES, L.P. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL
FOR THE THREE MONTHS ENDED MARCH 31, 1998
(unaudited)
(in thousands)
Partners' Partners'
Capital Deficit Total
------- ------- -----
Balance at December 31, 1997............. $175,395 $(41,727) $133,668
Net loss................................. -- (7,220) (7,220)
-------- -------- --------
Balance at March 31, 1998 ............... $175,395 $(48,947) $126,448
======== ======== ========
The accompanying notes are an integral part of this condensed consolidated
statement.
3
<PAGE>
TRUMP'S CASTLE ASSOCIATES, L.P. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1998
(unaudited)
(in thousands)
Three Months
Ended March 31,
----------------
1997 1998
---- ----
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Net loss ........................................... $ (8,684) $ (7,220)
Adjustments to reconcile net loss to net cash
flows provided by operating activities-
Noncash charges-
Depreciation and amortization ............... 5,041 4,050
Accretion of bond discount .................. 755 885
Provision for losses on receivables ......... 337 230
Valuation allowance-CRDA investments ........ 289 257
-------- --------
(2,262) (1,798)
Increase in receivables ..................... (546) (647)
(Increase) decrease in inventories .......... (393) 223
Decrease in other current assets ............ 216 448
Increase in other assets .................... (1,231) (13)
Increase in current liabilities ............. 7,252 12,629
Increase (decrease) in amounts due to
affiliates ................................ 3,901 (1,388)
Increase in other liabilities ............... 2,374 2,719
-------- --------
Net cash flows provided by operating
activities ............................ 9,311 12,173
-------- --------
CASH FLOWS USED IN INVESTING ACTIVITIES:
Purchases of property and equipment, net .... (584) (40)
Purchase of CRDA investments ................ (809) (770)
-------- --------
Net cash flows used in investing
activities ........................... (1,393) (810)
-------- --------
CASH FLOWS USED IN FINANCING ACTIVITIES:
Repayment of note payable to affiliate ...... -- (2,550)
Repayment of other borrowings ............... (1,081) (954)
-------- --------
Net cash flows used in financing
activities ............................ (1,081) (3,504)
-------- --------
Net increase in cash and cash equivalents 6,837 7,859
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ....... 15,380 14,472
-------- --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD ............. $ 22,217 $ 22,331
======== ========
SUPPLEMENTAL INFORMATION:
Cash paid for interest ............................. $ 1,118 $ 1,058
======== ========
The accompanying notes are an integral part of these condensed consolidated
statements.
4
<PAGE>
TRUMP'S CASTLE ASSOCIATES, L.P. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
(1) Organization and Operations
The accompanying condensed consolidated financial statements include those
of Trump's Castle Associates, L.P., a New Jersey limited partnership (the
"Partnership"), and its wholly owned subsidiary, Trump's Castle Funding, Inc., a
New Jersey corporation ("Funding"). The Partnership is wholly owned by Trump
Hotels & Casino Resorts Holdings, L.P., a Delaware limited partnership ("THCR
Holdings"). THCR Holdings is currently a 61.8% owned subsidiary of Trump Hotels
& Casino Resorts, Inc. ("THCR").
All significant intercompany balances and transactions have been
eliminated in the condensed consolidated financial statements.
The Partnership operates Trump Marina Hotel Casino ("Trump Marina"), a
luxury casino hotel located in the Marina District of Atlantic City, New Jersey.
The primary portion of Trump Marina's revenues are derived from its gaming
operations. Competition in the Atlantic City gaming market is intense and the
Partnership believes that the competition will continue due to expansion by
existing operators and new entrants to the gaming industry becoming operational.
Funding was incorporated solely to serve as a financing company to raise
funds through the issuance of bonds to the public. Since Funding has no business
operations, its ability to repay the principal and interest on the 10 1/4%
Senior Secured Notes due 2003 (the "New Senior Notes"), the 11 3/4% Mortgage
Notes due 2003 (the "Mortgage Notes") and its Increasing Rate Subordinated
Pay-in-Kind Notes due 2005 (the "PIK Notes") is completely dependent upon the
operations of the Partnership. (See Note 4 regarding refinancing of the Old
Senior Notes.)
On October 7, 1996, THCR Holdings acquired from Donald J. Trump ("Trump")
all of the outstanding equity of the Partnership (the "Castle Acquisition").
The accompanying condensed consolidated financial statements have been
prepared by the Partnership without audit. In the opinion of the Partnership,
all adjustments, consisting of only normal recurring adjustments necessary to
present fairly the financial position, results of operations and cash flows for
the periods presented have been made.
The accompanying condensed consolidated financial statements have been
prepared by the Partnership pursuant to the rules and regulations of the
Securities and Exchange Commission (the "SEC"). Accordingly, certain information
and note disclosures normally included in the financial statements prepared in
conformity with generally accepted accounting principles have been omitted.
These condensed consolidated financial statements should be read in
conjunction with the consolidated financial statements and notes thereto
included in the annual report on Form 10-K for the year ended December 31, 1997
filed with the SEC by the Partnership and Funding.
Certain reclassifications have been made to conform prior year financial
information to the current year presentation.
The casino industry in Atlantic City is seasonal in nature; accordingly,
the results of operations for the three month period ending March 31, 1998 are
not necessarily indicative of the operating results for a full year.
(2) Property and Equipment
During the second quarter of 1997, the Partnership revised its estimates
of the useful lives of buildings, building improvements and furniture and
fixtures which were acquired in 1996. Buildings and building improvements were
reevaluated to have a forty year life and furniture and fixtures were determined
to have a five to seven year life. The Partnership believes these changes more
appropriately reflect the timing of the economic benefits to be received from
these assets during their estimated useful lives. For the three months ended
March 31, 1998, the net effect of applying these new lives was to decrease the
net loss by $1,409,000.
5
<PAGE>
TRUMP'S CASTLE ASSOCIATES, L.P. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
(unaudited)
(3) Related Party Transactions
During November 1996 the Partnership entered into a $5,000,000 working
capital demand note payable to THCR Holdings. The note bears interest at a rate
of 9 1/2% per annum. During June 1997 the Partnership repaid $2,000,000 plus
accrued interest on this note and repaid an additional $2,550,000 during January
1998. At March 31, 1998 approximately $433,000 remained outstanding on this
note.
(4) Long Term Debt
On April 17, 1998, Funding, refinanced its 11 1/2% Senior Secured Notes
due 2000 (the "Old Senior Notes") and its term loan with a bank (the "Term
Loan") by issuing 10 1/4% Senior Secured Notes due 2003 (the "New Senior
Notes"). The proceeds from the issuance of the New Senior Notes were used to
redeem all of the issued and outstanding Old Senior Notes at 100% of their
principal amount and to repay the Term Loan in full. In conjunction with this
refinancing, Trump's Castle Hotel & Casino Inc., a New Jersey corporation and
the general partner of the Partnership ("TCHI"), obtained a working capital
credit facility (the "Working Capital Loan"). Both the New Senior Notes and the
Working Capital Loan are guaranteed by the Partnership.
The New Senior Notes have an outstanding principal amount of $62,000,000
and bear interest at the rate of 10 1/4% per annum, payable semi-annually each
April and October. The New Senior Notes mature on April 17, 2003.
The Working Capital Loan has an outstanding principal amount of $5,000,000
and bears interest at the rate of 10 1/4% per annum, payable semi-annually each
April and October. The entire principal balance of the Working Capital Loan
matures on April 17, 2003.
(5) Financial Information of Funding
Financial information relating to Funding is as follows (in thousands):
December 31, March 31,
1997 1998
-------- --------
Total Assets (including Mortgage Notes Receivable
of $242,141, net of unamortized discount of
$30,170 and $29,375 at December 31, 1997 and March
31, 1998, PIK Notes Receivable of $80,896, net of
unamortized discount of $7,197 and $7,107 at
December 31, 1997 and March 31, 1998, and Senior
Notes Receivable of $27,000 at December 31, 1997
and March 31, 1998)...................................... $312,670 $313,555
======== ========
Total Liabilities and Capital (including Mortgage
Notes Payable of $242,141, net of unamortized
discount of $30,170 and $29,375 at December 31,
1997 and March 31, 1998, PIK Notes Payable of
$80,896, net of unamortized discount of $7,197 and
$7,107 at December 31, 1997 and March 31, 1998,
and Senior Notes Payable of $27,000 at
December 31, 1997 and March 31, 1998).................... $312,670 $313,555
======== ========
Three Months
Ended March 31,
-------------------
1997 1998
------- -------
Interest Income................................... $11,061 $11,544
Interest Expense.................................. 11,061 11,544
------- -------
Net Income........................................ $ - $ -
======= =======
6
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Capital Resources and Liquidity
Cash flow from operating activities is the Partnership's principal source
of liquidity. For the three months ended March 31, 1998, the Partnership's net
cash flow provided by operating activities was $12,173,000.
In addition to funding operations, the Partnership's principal uses of
cash are capital expenditures and debt service.
Capital expenditures for 1998 are anticipated to be approximately
$5,000,000 and principally consist of hotel room renovations, as well as ongoing
casino floor improvements.
At March 31, 1998, the Partnership's debt consisted primarily of (i) the
Term Loan, (ii) the Old Senior Notes, (iii) the Mortgage Notes and (iv) the PIK
Notes. (See disclosures below regarding refinancing of the Term Loan and Old
Senior Notes.)
The Term Loan had an outstanding principal balance of approximately
$32,458,000 at March 31, 1998 and paid interest at the prime rate plus 3%, which
was 11 1/2% at March 31, 1998, and required amortized monthly principal payments
of approximately $158,000. The Term Loan was to mature on May 28, 2000.
The Old Senior Notes had an outstanding principal amount of $27,000,000 at
March 31, 1998 and paid interest at the rate of 11 1/2% per annum. The Old
Senior Notes were to mature on November 15, 2000 and were subject to a sinking
fund which required the retirement of 15% of the Old Senior Notes on each of
June 15, 1998 and 1999.
The Mortgage Notes have an outstanding principal amount of approximately
$242,141,000, bear interest at the rate of 11 3/4% per annum and mature on
November 15, 2003.
The PIK Notes have an outstanding principal amount of approximately
$80,896,000 and mature on November 15, 2005. Interest is currently payable
semi-annually at the rate of 13 7/8%. On or prior to November 15, 2003, interest
on the PIK Notes may be paid in cash or through the issuance of additional PIK
Notes. The Partnership anticipates that additional interest due during the
second quarter of 1998 of approximately $5,612,000 will be paid through the
issuance of additional PIK Notes.
On April 17, 1998, Funding refinanced its Old Senior Notes and its Term
Loan by issuing the New Senior Notes. The proceeds from the issuance of the New
Senior Notes were used to redeem all of the issued and outstanding Old Senior
Notes at 100% of their principal amount and to repay the Term Loan in full. In
conjunction with this refinancing, Trump's Castle Hotel & Casino, Inc., a New
Jersey corporation and the general partner of the Partnership ("TCHI"), obtained
a working capital credit facility (the "Working Capital Loan").
The New Senior Notes have an outstanding principal amount of $62,000,000
and bear interest at the rate of 10 1/4% per annum, payable semi-annually each
April and October. The New Senior Notes mature on April 17, 2003.
The Working Capital Loan has an outstanding principal amount of $5,000,000
and bears interest at the rate of 10 1/4% per annum, payable semi-annually each
April and October. The entire principal balance of the Working Capital Loan
matures on April 17, 2003.
The Partnership's total cash debt service requirement was approximately
$4,562,000 during the three months ended March 31, 1998 and the Partnership
anticipates that approximately $35,156,000 in cash will be required during the
remainder of 1998 (utilizing the repayment terms of the New Senior Notes and
Working Capital Loan previously discussed) to meet its debt service obligations.
The Partnership has the authority to obtain a working capital facility of up to
$10,000,000 (of which approximately $5,433,000 is outstanding - see Note 3 to
the Condensed Consolidated Financial Statements and the previous discussion
regarding the Working Capital Loan), although there can be no assurance that
such financing will be available or on terms acceptable to the Partnership.
Results of Operations: Operating Revenues and Expenses
The financial information presented below reflects the financial condition
and results of operations of the
7
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS - (Continued)
Partnership. Funding is a wholly owned subsidiary of the Partnership and
conducts no business other than collecting amounts due under certain
intercompany notes from the Partnership for the purpose of paying principal of,
premium, if any, and interest on its indebtedness, which Funding issued as a
nominee for the Partnership.
Comparison of Results of Operations for the Three Month Periods Ended March 31,
1997 and 1998.
Gaming revenues are the primary source of the Partnership's revenues and
primarily consist of slot machine and table games win. The following table
details activity for the major components of gaming revenues:
Three Months Ended March 31,
----------------------------
1997 1998
---- ----
(dollars in thousands)
Table Game Revenue................................. $ 18,544 $ 17,678
Decrease from Prior Period......................... ($866)
Table Game Drop.................................... $116,570 $111,844
Decrease from Prior Period......................... ($4,726)
Table Game Win Percentage.......................... 15.9% 15.8%
Decrease from Prior Period......................... (0.1%)
Number of Table Games.............................. 93 94
Increase from Prior Period......................... 1
Slot Revenue....................................... $ 45,143 $ 44,652
Decrease from Prior Period......................... ($491)
Slot Handle........................................ $547,887 $551,843
Increase from Prior Period......................... $ 3,956
Slot Win Percentage................................ 8.2% 8.1%
Decrease from Prior Period......................... (0.1%)
Number of Slot Machines............................ 2,332 2,155
Decrease from Prior Period......................... (177)
Poker Revenue...................................... $ 125 $ -
Decrease from Prior Period......................... ($125)
Number of Poker Tables............................. 6 -
Decrease from Prior Period......................... (6)
Other Gaming Revenue............................... $ 162 $ 283
Increase from Prior Period......................... $ 121
Total Gaming Revenues.............................. $ 63,974 $ 62,613
Decrease from Prior Period......................... ($1,361)
8
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS - (Continued)
Table game revenues represent the amount retained by the Partnership from
amounts wagered at table games. The table game win percentage tends to be fairly
constant over the long term, but may vary significantly in the short term, due
to large wagers by "high rollers." The Atlantic City industry table game win
percentages were 15.6% and 15.4% for the three month periods ended March 31,
1997 and 1998, respectively.
Non gaming revenues, in the aggregate, decreased by approximately
$1,126,000 or 8.0% to $12,936,000 for the three months ended March 31, 1998 from
$14,062,000 for the three months ended March 31, 1997, primarily as a result of
a decrease in food revenue activity.
Promotional allowances decreased by approximately $666,000 or 6.9% to
$8,946,000 for the three months ended March 31, 1998 from $9,612,000 for the
three months ended March 31, 1997, primarily as a result of a decrease in
complimentary food related to marketing activities.
Gaming costs decreased approximately $1,157,000 or 2.8% to $39,877,000 for
the three months ended March 31, 1998 from $41,034,000 for the three months
ended March 31, 1997. This decrease is primarily the result of a decrease in
promotional expenses.
Food and beverage costs and expenses for the three months ended March 31,
1998 decreased approximately $291,000 or 13.7% from the comparable period in
1997. This decrease is primarily due to the decreased level of complimentary
food provided to patrons.
General and administrative expenses decreased approximately $1,164,000 or
7.2% for the three months ended March 31, 1998 from the same period in 1997
primarily due to reduced advertising expenses and employee benefits.
Depreciation and amortization expense decreased approximately $991,000 or
19.7% for the three months ended March 31, 1998, from $5,041,000 for the three
months ended March 31, 1997. During the second quarter of 1997 management
decided to reevaluate the lives of fixed assets which were acquired in 1996. The
net effect of this revaluation was to decrease depreciation expense by
$1,409,000 for the three months ended March 31, 1998.
Interest expense increased approximately $417,000 or 3.4% to $12,615,000
for the three months ended March 31, 1998 from $12,198,000 for the three months
ended March 31, 1997 primarily due to an increase in the outstanding principal
related to the PIK Notes.
Seasonality
The casino industry in Atlantic City is seasonal in nature; accordingly,
the results of operations for the three month period ending March 31, 1998 are
not necessarily indicative of the operating results for a full year.
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Pursuant to the General Instructions to Rule 305 of Regulation S-K, the
quantitative and qualitative disclosures called for by this Item 3 and by Rule
305 of Regulation S-K are inapplicable to the Registrants at this time.
9
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
The Partnership, its partners, certain members of the former Executive
Committee, Funding and certain of their employees are involved in various legal
proceedings. Such persons and entities are vigorously defending the allegations
against them and intend to contest vigorously any future proceedings. The
Partnership and Funding have agreed to indemnify such persons against any and
all losses, claims, damages, expenses (including reasonable costs, disbursements
and counsel fees) and liabilities (including amounts paid or incurred in
satisfaction of settlements, judgments, fines and penalties) incurred by them in
said legal proceedings.
On August 14, 1996, certain stockholders of THCR filed two derivative
actions in the Court of Chancery in Delaware (Civil Action Nos. 15148 and 15160)
(the "Delaware cases") against each of the members of the Board of Directors of
THCR, THCR, THCR Holdings, the Partnership and TCI-II. The plaintiffs claim that
the directors of THCR breached their fiduciary duties in connection with the
Castle Acquisition by purchasing these interests at an excessive price in a
self-dealing transaction. The complaint sought to enjoin the transaction, and
also sought damages and an accounting. The injunction was never pursued. These
plaintiffs served a notice of dismissal in the Delaware cases on December 29,
1997. The Court of Chancery has not yet ordered the Delaware cases dismissed.
On October 16, 1996, a stockholder of THCR filed a derivative action in
the United States District Court, Southern District of New York (96 Civ. 7820)
against each member of the Board of Directors of THCR, THCR, THCR Holdings, the
Partnership, TCI, TCI-II, TCHI and Salomon Brothers, Inc. ("Salomon"). The
plaintiff claims that certain of the defendants breached their fiduciary duties
and engaged in ultra vires acts in connection with the Castle Acquisition and
that Salomon was negligent in the issuance of its fairness opinion with respect
to the Castle Acquisition. The plaintiff also alleges violations of the federal
securities laws for alleged omissions and misrepresentations in THCR's proxies,
and that Trump, TCI-II and TCHI breached the acquisition agreement by supplying
THCR with untrue information for inclusion in the proxy statement delivered to
THCR's stockholders in connection with the Castle Acquisition. The plaintiff
seeks removal of the directors of THCR, and an injunction, rescission and
damages.
The Delaware cases were amended and refiled in the Southern District of
New York and consolidated with the federal action for all purposes, including
pretrial proceedings and trial. On or about January 17, 1997, the plaintiffs
filed their Consolidated Amended Derivative Complaint (the "First Amended
Complaint"), reflecting the consolidation. On or about March 24, 1997, the
plaintiffs filed their Second Consolidated Amended Derivative Complaint (the
"Second Amended Complaint"). In addition to the allegations made in the First
Amended Complaint, the Second Amended Complaint claims that certain of the
defendants breached their fiduciary duties and wasted corporate assets in
connection with a previously contemplated transaction with Colony Capital, Inc.
("Colony Capital"). The Second Amended Complaint also includes claims against
Colony Capital for aiding and abetting certain of these violations. In addition
to the relief sought in the First Amended Complaint, the Second Amended
Complaint sought to enjoin the previously contemplated transaction with Colony
Capital or, if it was effectuated, to rescind it. On March 27, 1997, THCR and
Colony Capital mutually agreed to end negotiations with respect to such
transaction. On June 26, 1997, plaintiffs served their Third Consolidated
Amended Derivative Complaint (the "Third Amended Complaint"), which omitted the
claims against Colony Capital. THCR and the other defendants in the action moved
to dismiss the Third Amended Complaint on August 5, 1997. The plaintiffs opposed
the defendants' motions to dismiss the Third Amended Compliant by response dated
October 24, 1997. The defendant's reply was served December 9, 1997. By letter
dated April 2, 1998, the plaintiffs sought to amend further the Third Amended
Complaint to add certain additional factual allegations. The defendants opposed
the application, and the Court has not yet ruled on it.
Various other legal proceedings are now pending against the Partnership.
The Partnership considers all such proceedings to be ordinary litigation
incident to the character of its business. Management believes that the
resolution of these claims will not, individually or in the aggregate, have a
material adverse effect on the financial condition or results of operations of
the Partnership.
From time to time, the Partnership may be involved in routine
administrative proceedings involving alleged violations of certain provisions of
the Casino Control Act. However, the Partnership believes that the final outcome
of these proceedings will not, either individually or in the aggregate, have a
material adverse effect on the Partnership or on its ability to otherwise retain
or renew any casino or other licenses required under the Casino Control Act for
the operation of Trump Marina.
10
<PAGE>
PART II - OTHER INFORMATION - (Continued)
ITEM 2 - CHANGES IN SECURITIES AND USE OF PROCEEDS
None.
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5 - OTHER INFORMATION
None.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits:
Exhibit No. Description of Exhibit
- ----------- ----------------------
4.33 Note Purchase Agreement dated as of April 17, 1998, for 10 1/4%
Series A Senior Secured Notes due 2003 of Trump's Castle Funding,
Inc. and 10 1/4% Series A Senior Secured Notes due 2003 of Trump's
Castle Hotel & Casino,Inc.
4.34 Indenture, dated as of April 17, 1998, by and among Trump's Castle
Hotel & Casino, Inc., as issuer, Trump's Castle Associates, L.P., as
guarantor, and U.S. Bank National Association, as trustee.
4.35 Indenture, dated as of April 17, 1998, by and among Trump's Castle
Funding, Inc., as issuer, Trump's Castle Associates, L.P., as
guarantor, and U.S. Bank National Association, as trustee.
4.36 Registration Rights Agreement, dated as of April 17, 1998, by and
among Trump's Castle Hotel & Casino, Inc., Trump's Castle
Associates, L.P., Trump's Castle Funding, Inc. and funds managed by
Putnam Investment Management.
4.37 Intercreditor Agreement, dated as of April 17, 1998, between Trump's
Castle Associates, L.P., Trump's Castle Funding, Inc., Trump's
Castle Hotel & Casino, Inc. and U.S. Bank National Association.
4.38 Indenture of Mortgage and Security Agreement, dated as of April 17,
1998, between Trump's Castle Associates, L.P., as Mortgagor/Debtor,
and Trump's Castle Funding, Inc., as Mortgagee/Secured Party.
4.39 Indenture of Mortgage and Security Agreement, dated as of April 17,
1998, between Trump's Castle Associates, L.P., as Mortgagor/Debtor,
and U.S. Bank National Association, as Mortgagee/Secured Party.
11
<PAGE>
PART II - OTHER INFORMATION - (Continued)
4.40 Senior Assignment Agreement, dated as of April 17, 1998, by Trump's
Castle Funding, Inc., as Assignor, to U.S. Bank National
Association, as Assignee.
4.41 Indenture of Mortgage and Security Agreement, dated as of April 17,
1998, between Trump's Castle Associates, L.P., as Mortgagor/Debtor,
and Trump's Castle Hotel & Casino, Inc., as Mortgagee/Secured Party.
4.42 Indenture of Mortgage and Security Agreement, dated as of April 17,
1998, between Trump's Castle Associates, L.P., as Mortgagor/Debtor,
and U.S. Bank National Association, as Mortgagee/Secured Party.
4.43 Senior TCHI Assignment Agreement, dated as of April 17, 1998, by
Trump's Castle Hotel & Casino, Inc., as Assignor, to U.S. Bank
National Association, as Assignee.
27.1 Financial Data Schedule of Trump's Castle Funding, Inc.
27.2 Financial Data Schedule of Trump's Castle Associates, L.P.
b. Current Reports on Form 8-K:
None.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRUMP'S CASTLE FUNDING, INC.
(Registrant)
Date: May 15, 1998
By: /s/ NICHOLAS L. RIBIS
--------------------------------------
Nicholas L. Ribis
President and Chief Executive Officer
(Duly Authorized Officer and
Principal Financial Officer)
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRUMP'S CASTLE ASSOCIATES, L.P.
(Registrant)
By: Trump's Castle Hotel & Casino, Inc.
its general partner
Date: May 15, 1998
By: /s/ NICHOLAS L. RIBIS
--------------------------------------
Nicholas L. Ribis
President and Chief Executive Officer
(Duly Authorized Officer and
Principal Financial Officer)
14
- --------------------------------------------------------------------------------
NOTE PURCHASE AGREEMENT
- --------------------------------------------------------------------------------
$62,000,000
10 1/4% Series A Senior Secured Notes due 2003
of
TRUMP'S CASTLE FUNDING, INC.
Guaranteed by
TRUMP'S CASTLE ASSOCIATES, L.P.
and
$5,000,000
10 1/4% Series A Senior Secured Notes due 2003
of
TRUMP'S CASTLE HOTEL & CASINO, INC.
Guaranteed by
TRUMP'S CASTLE ASSOCIATES, L.P.
- --------------------------------------------------------------------------------
April 17, 1998
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINITIONS .................................................... 1
SECTION 2. PURCHASE AND SALE OF SENIOR NOTES .............................. 7
2.1. Issuance of Senior Notes and Senior Guarantee ............ 7
2.1.1. Issuance of the Funding Notes and Related
Senior Guarantee ......................................... 7
2.1.2. Issuance of the TCHI Notes and Related
Senior Guarantee ......................................... 7
2.2. Sale and Purchase of the Senior Notes; the Closing ....... 7
2.2.1. Sale and Purchase of the Funding Notes ..... 7
2.2.2. Sale and Purchase of the TCHI Notes ........ 8
2.2.3. Closing .................................... 8
2.2.4. Use of Proceeds ............................ 8
2.3. Each Fund's Representations .............................. 9
2.3.1. Authorization and Authority ................ 9
2.3.2. Investment Intent; Transfer of Senior
Notes .................................................... 9
2.3.3. ERISA ...................................... 10
2.3.4. Registered Investment Company .............. 10
2.4. Failure to Deliver ....................................... 10
2.4.1. No Closing ................................. 11
2.4.2. Failure to Notify .......................... 11
2.5. Expenses ................................................. 12
2.6. Indemnification .......................................... 12
2.6.1. Scope of Indemnification ................... 12
2.6.2. Indemnification Procedures ................. 13
2.7. Contribution ............................................. 14
2.7.1. Indemnification Provisions Unenforceable ... 14
2.7.2. No Pro Rata Allocation ..................... 15
2.7.3. Survival of Obligations .................... 15
2.8. Further Actions .......................................... 15
SECTION 3. CLOSING CONDITIONS .............................................. 15
3.1. Conditions to the Funds' Obligations ..................... 15
3.1.1. Opinion of Counsel ......................... 16
3.1.2. Officers' Certificates ..................... 16
3.1.3. Issue of Senior Notes ...................... 16
3.1.4. Representations and Warranties True; No
Event of Default ......................................... 16
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<PAGE>
3.1.5. Compliance with Agreements ................. 17
3.1.6. Purchase Permitted by Applicable Laws;
Legal Investment ......................................... 17
3.1.7. The Indentures, the Registration Rights
Agreement and the Security Documentation ................. 17
3.1.8. Consents and Permits ....................... 18
3.1.9. Proceedings Satisfactory ................... 18
3.1.10. No Material Adverse Change ................ 18
3.1.11. No Material Judgment or Order ............. 18
3.2. Conditions to the Obligations of Funding and TCHI ......... 18
3.2.1. Sale of Senior Notes ....................... 19
3.2.2. Funds' Representations and Warranties ...... 19
3.2.3. No Material Judgment or Order .............. 19
3.2.4. The Sale by Funding and TCHI Permitted by
Applicable Laws .......................................... 19
3.2.5. Consents and Permits ....................... 19
SECTION 4. THE FUNDS' SPECIAL RIGHTS ....................................... 20
4.1. Delivery Expenses ........................................ 20
4.2. Issue Taxes .............................................. 20
4.3. Direct Payment ........................................... 20
4.4. Inspection ............................................... 21
4.5. Financial Statements ..................................... 21
4.5.1. Delivery ................................... 21
4.5.2. Disclosure; Officer's Certificate .......... 22
4.5.3. Additional Information ..................... 22
4.6. ERISA Compliance ......................................... 22
4.7. No Bond Necessary ........................................ 22
SECTION 5. REPRESENTATIONS AND WARRANTIES .................................. 23
5.1. Organization, Standing and Qualification ................. 23
5.1.1. Organization; Standing ..................... 23
5.1.2. Authority .................................. 23
5.2. Authorization of Agreement and Other Documents ........... 24
5.3. No Violation ............................................. 24
5.3.1. Existing Violations ........................ 24
5.3.2. Execution of Agreement ..................... 24
5.4. No Default ............................................... 25
5.5. Full Disclosure .......................................... 25
5.6. ERISA .................................................... 25
5.7. Compliance with Laws ..................................... 26
5.8. Consents ................................................. 26
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<PAGE>
5.9. No Violation of Regulations of Board of Governors of
Federal Reserve System ................................... 26
5.10. Private Offering ......................................... 27
5.10.1. Sale Exempt ............................... 27
5.10.2. No General Solicitation ................... 27
5.11. Governmental Regulations ................................. 27
5.12. Survival of Indemnification and Contribution and
Representations and Warranties ........................... 28
SECTION 6. MISCELLANEOUS ................................................... 28
6.1. Notices .................................................. 28
6.2. Successors and Assigns ................................... 29
6.3. Amendment and Waiver ..................................... 29
6.4. Counterparts ............................................. 29
6.5. Headings ................................................. 29
6.6. Governing Law ............................................ 29
6.7. Entire Agreement ......................................... 30
6.8. Severability ............................................. 30
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<PAGE>
EXHIBITS
Exhibit A Form of Funding Note Indenture
Exhibit B Form of TCHI Note Indenture
Exhibit C Form of Registration Rights Agreement
Exhibit D Form of Indenture of Mortgage and Security Agreement (Senior Note
Mortgage)
Exhibit E Form of Indenture of Mortgage and Security Agreement (Senior
Guarantee Mortgage)
Exhibit F Form of Indenture of Mortgage and Security Agreement (Senior
Partnership Upstream Note Mortgage)
Exhibit G Form of Indenture of Mortgage and Security Agreement (TCHI Note
Guarantee Mortgage)
Exhibit H Form of Intercreditor Agreement
Exhibit I Form of Opinion of Willkie Farr & Gallagher
Exhibit J Form of Opinion of Graham, Curtin & Sheridan
Exhibit K Form of Opinion of Sterns & Weinroth
-v-
<PAGE>
TRUMP'S CASTLE FUNDING, INC.
TRUMP'S CASTLE HOTEL & CASINO, INC.
TRUMP'S CASTLE ASSOCIATES, L.P.
Brigantine Boulevard and Huron Avenue
Atlantic City, New Jersey 08401
As of April 17, 1998
THE FUNDS AND ACCOUNTS LISTED ON SCHEDULES I, II, III, and IV HERETO
c/o Putnam Investment Management
One Post Office Square
Boston, Massachusetts 02110
Re: 10 1/4% Series A Senior Secured Notes due 2003
Ladies and Gentlemen:
Each of Trump's Castle Funding, Inc., a New Jersey corporation
("Funding"), Trump's Castle Hotel & Casino, Inc., a New Jersey corporation
("TCHI") and Trump's Castle Associates, L.P., a New Jersey limited partnership
(the "Partnership"), hereby agrees with each of you (each of you individually
being hereinafter referred to as a "Fund", and all of you collectively as the
"Funds") as follows:
I. SECTION DEFINITIONS.
As used in this Agreement, the following terms shall have the following
meanings:
"accumulated funding deficiency" shall have the meaning specified in
Section 4.6 hereof.
"Affiliate" means, with respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control", when used with respect to any 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" have meanings correlative to the foregoing.
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<PAGE>
"Agreement" means this Note Purchase Agreement, as the same may be
amended, supplemented or modified from time to time in accordance with the terms
hereof.
"Applicable Law" means any Federal, state, local or foreign statute, law,
ordinance, governmental rule or regulation or any judgment, decree, rule or
order of any court or governmental agency or authority applicable to the
Partnership or any of its Subsidiaries or any of their respective properties,
assets or operations.
"Assignment of Leases and Rents and Assignment of Operating Assets" means
collectively (i) the Assignment of Leases and Rents and Assignment of Operating
Assets dated as of the date hereof, by the Partnership to Funding; (ii) the
Assignment of Leases and Rents and Assignment of Operating Assets dated as of
the date hereof, by the Partnership to the Funding Note Trustee; (iii) the
Assignment of Leases and Rents and Assignment of Operating Assets dated as of
the date herof, by the Partnership to TCHI; and (iv) the Assignment of Leases
and Rents and Assignment of Operating Assets dated as of the date herof, by the
Partnership to the TCHI Note Trustee.
"Business Day" means a day that is not a Saturday, a Sunday or a day on
which banking institutions in either the State of New Jersey or the State of New
York are not required to be open.
"Charter Documents" means the Articles or Certificate of Incorporation and
By-Laws, limited partnership agreement or similar organizational documents, as
amended to the Closing Date, of the applicable Person.
"Closing" shall have the meaning specified in Section 2.2.3 hereof.
"Closing Date" shall have the meaning specified in Section 2.2.3 hereof.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission.
"complete withdrawal" shall have the meaning specified in Section 4.6
hereof.
"Default" means any event, act or condition that is, or after notice or
passage of time or both would constitute, an Event of Default.
"disqualified person" shall have the meaning specified in Section 2.3.3
hereof.
"Documents" means all documents delivered in connection with the
transactions contemplated by this Agreement, including without limitation, the
Senior Notes, the Funding Note Indenture, the TCHI Note Indenture, the
Registration Rights Agreement, Senior
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<PAGE>
Partnership Note, the Senior Partnership Upstream Note and the Security
Documentation, collectively, or each of such documents singularly, and any
documents or instruments contemplated by or executed in connection with any of
them or any of the transactions contemplated hereby or thereby.
"employee benefit plan" shall have the meaning specified in Section 2.3.3
hereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" shall have the meaning specified in Section 4.6 hereof.
"Event of Default" means any event defined as an Event of Default in
either the Funding Note Indenture or the TCHI Note Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the Commission thereunder.
"Funds" shall have the meaning specified in the first paragraph hereof.
"Funding" means Trump's Castle Funding, Inc., a New Jersey corporation,
and any successor thereto.
"Funding Note Indenture" means the Indenture, dated as of the date hereof,
by and between Funding, as issuer, the Partnership, as guarantor, and U.S. Bank
National Association, as trustee, in substantially the form of Exhibit A hereto,
as the same may be amended from time to time in accordance with the terms
thereof.
"Funding Notes" means the $62,000,000 aggregate original principal amount
10 1/4 Series A Senior Secured Notes due 2003 of Funding, and any other debt
securities issued in exchange for such notes.
"Indemnified Parties" shall have the meaning specified in Section 2.6.1
hereof.
"Intercreditor Agreement" means the Intercreditor Agreement, dated as of
the date hereof, by and among U.S. Bank National Association, as trustee under
the Mortgage Note Indenture, U.S. Bank National Association, as trustee under
the Funding Note Indenture, U.S. Bank National Association, as trustee under the
PIK Note Indenture, U.S. Bank National Association, as trustee under the TCHI
Note Indenture, Funding, TCHI and the Partnership in substantially the form of
Exhibit H hereto, as the same may be amended from time to time in accordance
with the terms thereof.
"Lien" shall have the meaning specified in the Funding Note Indenture and
the TCHI Note Indenture.
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<PAGE>
"Losses" shall have the meaning specified in Section 2.6.1 hereof.
"Material Adverse Effect" means a material adverse effect on the
properties, business, operations, earnings, assets, liabilities or financial
condition of the Partnership, TCHI and Funding, taken as a whole, or on the
ability of the Partnership, TCHI or Funding to perform their respective
obligations under this Agreement, the Senior Notes or any of the other
Documents.
"Mortgage Note Indenture" means that certain indenture among Funding, as
issuer, the Partnership, as guarantor, and First Bank National Association, (now
known as U.S. Bank National Association), as trustee, dated as of December 28,
1993, relating to Funding's 11 3/4% Mortgage Notes due 2003, as the same may be
amended from time to time in accordance with the terms thereof.
"Most Recent 10-K" means the annual report of the Partnership and Funding
on Form 10-K for the fiscal year ended December 31, 1997, as filed with the
Commission (Commission File Number 1-9029), including all exhibits thereto and
all material incorporated by reference therein.
"Multiemployer Plan" shall have the meaning specified in Section 4.6
hereof.
"Old Senior Notes" means the 11 1/2% Senior Secured Notes due 2000 of
Funding issued pursuant to an Indenture dated as of December 28, 1993 among
Funding, as issuer, First Bank National Association (now known as U.S. Bank
National Association), as trustee, and Trump's Castle Associates, as Guarantor.
"partial withdrawal" shall have the meaning specified in Section 4.6
hereof.
"Partnership" means Trump's Castle Associates, L.P., a New Jersey limited
partnership, and any successor thereto.
"party in interest" shall have the meaning specified in Section 2.3.3
hereof.
"Person" means any individual, partnership, corporation, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or agency or political subdivision thereof, or other
entity.
"PIK Note Indenture" means that certain indenture among Funding, as
issuer, the Partnership, as guarantor, and First Bank National Association (now
known as U.S. Bank National Association), as trustee, dated as of December 28,
1993, relating to Funding's Subordinated Pay-in-Kind Notes due 2005.
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<PAGE>
"Privately Outstanding Notes" means any or all of the Senior Notes upon
the original issuance thereof and at all times subsequent thereto until, in the
case of any Senior Note, (i) the registered exchange offer provided for in
Section 2 of the Registration Rights Agreement shall have been consummated and
such Senior Note shall have been resold by the Fund which purchased such Senior
Note, (ii) the sale or other public distribution of such Senior Note shall have
been registered pursuant to the Securities Act and such Senior Note shall have
been disposed of by the Fund which purchased such Senior Note in accordance with
such registration, or (iii) such Senior Note shall have been resold by the Fund
pursuant to Rule 144, Rule 144A or other resale exemption from the registration
requirements of the Securities Act.
"Proceeding" means an action, claim, suit or proceeding (including,
without limitation, an investigation or partial proceeding, such as a
deposition), whether commenced or to the knowledge of TCHI, Funding or the
Partnership, threatened.
"prohibited transaction" shall have the meaning specified in Section 4.6
hereof.
"qualified trust" shall have the meaning specified in Section 2.3.3
hereof.
"Registration Rights Agreement" means the Registration Rights Agreement of
even date herewith by and among TCHI, Funding, the Partnership and the Funds,
relating to the registration of the Senior Notes pursuant to the Securities Act
and in substantially the form of Exhibit B hereto.
"reportable event" shall have the meaning specified in Section 4.6 hereof.
"Rule 144" means Rule 144 as promulgated by the Commission pursuant to the
Securities Act, and any successor rule or regulation thereto.
"Rule 144A" means Rule 144A as promulgated by the Commission pursuant to
the Securities Act, and any successor rule or regulation thereto.
"Scheduled Closing Date" shall have the meaning specified in Section
2.4.2.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated by the Commission pursuant thereto.
"Security Documentation" means the Indenture of Mortgage and Security
Agreement (Senior Note Mortgage), dated the date hereof, by and between the
Partnership, as mortgagor and debtor, and Funding, as mortgagee and secured
party; the Indenture of Mortgage and Security Agreement (Senior Guarantee
Mortgage), dated the date hereof, by and between the Partnership, as mortgagor
and debtor, and U.S. Bank National Association, as trustee under the Funding
Note Indenture, as mortgagee and secured party, the Indenture of Mortgage and
Security Agreement (Senior Partnership Upstream Note Mortgage), dated the date
hereof, by
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<PAGE>
and between the Partnership as mortgagor and debtor and TCHI, as mortgagee and
secured party, the Indenture of Mortgage and Security Agreement (TCHI Note
Guarantee Mortgage), dated the date hereof, by and between the Partnership, as
mortgagor and debtor, and the U.S. Bank National Association, as trustee under
the TCHI Note Indenture, as mortgagee and secured party, in substantially the
forms of Exhibits D, E, F and G hereto, respectively, the Senior Assignment
Agreement, the Senior Partnership Upstream Assignment Agreement, the Assignment
of Leases and Rents and Assignment of Operating Leases, the Intercreditor
Agreement and the other agreements and documents entered into or delivered in
connection with the foregoing.
"Senior Assignment Agreement" means the Senior Assignment Agreement dated
as of the date hereof, by Funding to the Trustee, as trustee under the Funding
Note Indenture.
"Senior Notes" means the TCHI Notes and the Funding Notes.
"Senior Partnership Note" means the Note, dated the date hereof, in the
original principal amount of $62,000,000 made by the Partnership in favor of
Funding.
"Senior Partnership Upstream Assignment Agreement" means the Senior
Partnership Upstream Assignment Agreement dated as of the date hereof, by TCHI
to the Trustee, as trustee under the TCHI Note Indenture.
"Senior Partnership Upstream Note" means the Note, dated the date hereof
in the original principal amount of $5,000,000 made by the Partnership in favor
of TCHI.
"Subsidiary" means, with respect to any Person, (i) a corporation a
majority of whose capital stock with voting power, under ordinary circumstances,
to elect directors is owned, directly or indirectly, by such Person or by one or
more other Subsidiaries of such Person, or by such Person and one or more
Subsidiaries thereof or (ii) any other Person (other than a corporation) in
which such Person, or one or more other Subsidiaries of such Person or such
Person and one or more other Subsidiaries thereof, directly or indirectly, has
at least a majority ownership and power to direct the policies, management and
affairs thereof.
"TCHI" means Trump's Castle Hotel & Casino, Inc., a New Jersey
corporation.
"TCHI Note Indenture" means the Indenture, dated as of the date hereof, by
and between TCHI, as issuer, the Partnership, as guarantor, and U.S. Bank
National Association, as trustee thereunder, in substantially the form of
Exhibit B hereto, as the same may be amended from time to time in accordance
with the terms thereof.
"TCHI Notes" means the $5,000,000 aggregate original principal amount of
10 1/4% Series A Senior Secured Notes due 2003 of TCHI, and any other debt
securities issued in exchange or substitution for such notes.
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<PAGE>
"Trustee" shall mean U.S. Bank National Association in its capacity as
trustee under the Funding Note Indenture and in its capacity as the Trustee
under the TCHI Note Indenture.
SECTION 2. PURCHASE AND SALE OF SENIOR NOTES.
2.1. Issuance of Senior Notes and Senior Guarantee.
2.1.1. Issuance of the Funding Notes and Related Senior Guarantee.
(a) Funding has taken all necessary corporate action to authorize the
issuance and sale of up to $62,000,000 aggregate original principal amount of
its 10 1/4% Series A Senior Secured Notes due 2003 and to make the Funding Notes
the enforceable obligations they purport to be. The Funding Notes will be issued
in denominations of $1,000 and any integral multiple thereof, and will otherwise
be substantially in the form set forth in Article II of the Funding Note
Indenture.
(b) The Partnership has taken all necessary partnership action to
authorize the issuance of its unconditional guarantee of payment of the Funding
Notes as set forth in the Funding Note Indenture, the issuance of the Senior
Partnership Note and the execution and delivery of the Security Documentation to
which it is a party and to make each of its guarantee of the Funding Notes, the
Senior Partnership Note and the Security Documentation to which it is a party
the enforceable obligation it purports to be.
2.1.2. Issuance of the TCHI Notes and Related Senior Guarantee.
(a) TCHI has taken all necessary corporate action to authorize the
issuance and sale of up to $5,000,000 aggregate original principal amount of its
10 1/4% Series A Senior Secured Notes due 2003 and to make the TCHI Notes the
enforceable obligations they purport to be. The TCHI Notes will be issued in
denominations of $1,000 and any integral multiple thereof, and will otherwise be
substantially in the form set forth in Article II of the TCHI Note Indenture.
(b) The Partnership has taken all necessary partnership action to
authorize the issuance of its unconditional guarantee of payment of the TCHI
Notes as set forth in the TCHI Note Indenture, the issuance of the Senior
Partnership Upstream Note and the execution and delivery of the Security
Documentation to which it is a party and to make each of its guarantee of the
TCHI Notes, the Senior Partnership Upstream Note and the Security Documentation
to which it is a party the enforceable obligation it purports to be.
2.2. Sale and Purchase of the Senior Notes; the Closing.
2.2.1. Sale and Purchase of the Funding Notes.
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Subject to the terms and conditions set forth herein, Funding hereby
agrees to sell to each Fund the aggregate original principal amount of Funding
Notes set forth opposite the name of such Fund on Annex E hereof. All of the
Funding Notes shall be sold at a price equal to 100% of the original principal
amount thereof.
In reliance upon the representations and warranties of Funding, TCHI and
the Partnership contained herein, in the other Documents and in the Most Recent
10-K, and subject to the terms and conditions set forth herein and therein, each
Fund hereby agrees, severally and not jointly, to purchase the Funding Notes to
be purchased by such Fund at the purchase price set forth in this Section. Each
Fund shall, severally and not jointly, be liable for only the purchase of that
portion of such Funding Notes set forth opposite the name of such Fund on Annex
E hereof.
2.2.2. Sale and Purchase of the TCHI Notes.
Subject to the terms and conditions set forth herein, TCHI hereby agrees
to sell to each Fund the aggregate original principal amount of TCHI Notes set
forth opposite the name of such Fund on Annex E hereof. All of the TCHI Notes
shall be sold at a price equal to 100% of the original principal amount thereof.
In reliance upon the representations and warranties of Funding, TCHI and
the Partnership contained herein, in the other Documents and in the Most Recent
10-K, and subject to the terms and conditions set forth herein and therein, each
Fund hereby agrees, severally and not jointly, to purchase the TCHI Notes to be
purchased by such Fund at the purchase price set forth in this Section. Each
Fund shall, severally and not jointly, be liable for only the purchase of that
portion of such TCHI Notes set forth opposite the name of such Fund on Annex E
hereof.
2.2.3. Closing.
The sale and purchase of the Senior Notes shall take place at a closing
(the "Closing") at the offices of Willkie Farr & Gallagher, 153 East 53rd
Street, New York, New York 10022, commencing at 9:30 A.M., New York time, on
April 17, 1998, or such other place, Business Day (not in any event later than
May 15, 1998) and time as may be agreed upon by the Funds and Funding (such time
and date being referred to as the "Closing Date"). At the Closing, Funding and
TCHI will deliver to each of the Funds one or more Senior Notes in the aggregate
principal amount or amounts to be purchased by such Fund, registered in its name
or in the name(s) of such nominee(s) or designee(s) as such Fund may request,
against payment of the purchase price therefor by Federal funds bank wire
transfer of same day funds to such bank account as Funding, TCHI and the
Partnership shall designate at least two Business Days prior to the Closing
Date.
2.2.4. Use of Proceeds.
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(a) Funding Notes.
The proceeds from the sale of the Funding Notes shall be applied by
Funding or the Partnership (i) to fund the redemption at 100% of the principal
amount thereof, plus accrued but unpaid interest, of the Old Senior Notes, such
redemption to occur immediately upon the issuance of the Funding Notes; (ii) to
repay the principal amount of and all accrued but unpaid interest in, with all
expenses and costs related to, the Loan outstanding under the Amended and
Restated Credit Agreement, dated as of December 28, 1993, between Funding, the
Partnership and Midlantic National Bank (or any successor thereto), as in effect
in the Closing Date; and (iii) to pay expenses of the Partnership in connection
with the refinancing of the indebtedness described in clauses (i) and (ii) of
this sentence pursuant to this Agreement and the Documents. In connection with
the payment referred to in clause (i) of the first sentence of this Section
2.2.4(a), the Partnership shall pay in full, together with accrued but unpaid
interest, the Note dated as of December 28, 1993 made by the Partnership to
Funding in the original principal amount of $27,000,000. In connection with
payment referred to in clause (ii) of the first sentence of this Section
2.2.4(a), the Partnership and Funding shall obtain the release of all mortgages,
liens security interest and other encumbrances granted in connection with such
indebtedness and any other security interests of Midlantic National Bank or any
successor thereto in the assets or property of, or otherwise in connection with,
the Partnership and Funding.
(b) TCHI Notes.
The indebtedness of TCHI and the Partnership evidenced by the TCHI Notes
is a part of the Working Capital Facility of the Partnership described in the
Funding Note Indenture, the Mortgage Note Indenture and the PIK Note Indenture.
The proceeds from the sale of TCHI Notes shall be applied to meet the
Partnership's general working capital requirements.
2.3. Each Fund's Representations.
2.3.1. Authorization and Authority.
Each Fund represents to TCHI, Funding and the Partnership that such Fund
has taken all necessary action to authorize the execution and delivery of this
Agreement and the Registration Rights Agreement and to make each of this
Agreement and the Registration Rights Agreement the enforceable obligation it
purports to be.
2.3.2. Investment Intent; Transfer of Senior Notes.
Each Fund represents to TCHI, Funding and the Partnership that such Fund
is purchasing the Senior Notes being purchased by such Fund hereunder for its
own account, and with no intention of distributing or reselling such Senior
Notes or any part thereof in any
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transaction that would violate the securities laws of the United States of
America or any state thereof.
If any Fund desires to offer, sell or otherwise transfer, pledge or
hypothecate all or any part of the Senior Notes (other than pursuant to an
effective registration statement under the Securities Act or pursuant to Rule
144 or Rule 144A) such Fund shall deliver to Funding, in the case of the Funding
Notes, or TCHI in the case of the TCHI Notes, a written opinion of Ropes & Gray
or other counsel, reasonably satisfactory in form and substance to Funding or
TCHI, as the case may be, that there is available therefor an exemption from the
registration requirements of the Securities Act. Upon original issuance thereof,
and until such time as no longer required by law, each of the Senior Notes
originally issued (and all Senior Notes issued in exchange therefor or
substitution thereof) shall bear a legend in substantially the form set forth in
Section 2.2 of the Funding Note Indenture or the TCHI Note Indenture, as the
case may be.
At such time that any such legend is no longer required by law to be borne
by a Senior Note, Funding or TCHI, as the case may be, shall, at the request of
the holder thereof, cause such legend to be removed or replace such certificate
with an unlegended security.
2.3.3. ERISA.
Each Fund represents to TCHI, Funding and the Partnership that either (i)
no part of the funds to be used to purchase the Senior Notes to be purchased by
such Fund constitutes assets allocated to any qualified trust that contains the
assets of any employee benefit plan with respect to which TCHI, Funding or the
Partnership is a party in interest or disqualified person or (ii) the use of
such assets would not constitute a non-exempt prohibited transaction. The
representations made by each Fund in the preceding clauses are made solely in
reliance upon its review of the list (a copy of which is set forth as Schedule
2.3.3 hereto), previously furnished to the Funds by TCHI, Funding and the
Partnership, which identifies the qualified trusts that contain assets of any
employee benefit plans with respect to which TCHI, Funding or the Partnership is
a party in interest or a disqualified person. The terms "employee benefit plan"
and "party in interest" shall have the meanings assigned to such terms in
Section 3 of ERISA, the term "disqualified person" shall have the meaning
assigned to such term in section 4975 of the Code, and the term "qualified
trust" shall mean any trust qualified under section 401(a) of the Code in which
is held the assets of any employee benefit plan.
2.3.4. Registered Investment Company.
Each Fund represents to TCHI, Funding and the Partnership that it is
registered as an investment company under the Investment Company Act of 1940, as
amended.
2.4. Failure to Deliver.
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2.4.1. No Closing.
Notwithstanding anything to the contrary contained in this Agreement, this
Agreement may be terminated and the transactions contemplated hereby may be
abandoned at any time prior to the Closing:
(i) By the mutual consent of all of the parties;
(ii) By the Funds at any time in the event of a breach or default by
either TCHI, Funding or the Partnership in the observance or in the timely
performance of any of its obligations hereunder which is not waived by the
Funds and which remains uncured for fifteen (15) days after receipt of
notice in writing of such breach or default;
(iii) By Funding, TCHI and the Partnership at any time in the event
of a breach or default by any Fund in the observance or in the timely
performance of any of its obligations hereunder which is not waived by
Funding, TCHI and the Partnership and remains uncured for fifteen (15)
days after receipt of notice in writing of such breach or default; or
(iv) If the Closing shall not have occurred on or before May 15,
1998, at anytime thereafter by (i) the Funds or (ii) TCHI, Funding and the
Partnership.
No termination under this section shall be effective unless and until the
terminating party gives written notice of such termination to the other party.
2.4.2. Failure to Notify.
If the Closing shall not actually occur on any date on which the Closing
is scheduled to occur (the "Scheduled Closing Date") (other than by reason of
the failure of one or more of the Funds to purchase Senior Notes duly tendered),
and Funding and TCHI shall have failed to notify Ropes & Gray prior to 12:00
p.m., New York time, on such Scheduled Closing Date that such Closing has been
postponed, Funding or TCHI, as the case may be, shall pay to each Fund by wire
transfer of immediately available funds to the bank account designated by such
Fund (as compensation for its loss of funds and administrative costs) an amount
equal to interest on the aggregate purchase price for the Senior Notes to have
been purchased by such Fund on such Scheduled Closing Date, at the effective
rate of interest equal to 11 1/4% per annum, less the overnight Federal funds
rate, for each day from and including such Scheduled Closing Date to and
including the earlier of the date on which such Closing actually occurs or the
date on which the amount to be paid by such Fund as the purchase price of such
Senior Notes is available to such Fund for reinvestment, provided, that Funding
or TCHI, as the case may be, shall pay to such Fund in any case not less than
one day's interest at such specified rate.
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2.5. Expenses.
Whether or not the Senior Notes are sold, Funding, TCHI and the
Partnership shall pay all reasonable expenses relating to this Agreement and the
other Documents, including, but not limited to:
(a) the cost of printing, reproducing and filing this Agreement, the other
Documents and any other documents contemplated hereby or thereby;
(b) the reasonable fees and charges and disbursements of Ropes & Gray, the
Funds' special counsel, and Lowenstein Sandler PC, the Funds' special New Jersey
real property counsel, or such other counsel as the Funds may employ on their
behalf with the consent of Funding and TCHI;
(c) the cost of delivering to your home office or the office of your
designee the Senior Notes purchased by the Funds at the Closing upon the
issuance thereof;
(d) all expenses, including reasonable attorneys' fees, relating to any
amendment to, or modification of, or any waiver, or consent or preservation of
rights under, this Agreement or any of the Documents;
(e) all other expenses, including reasonable attorneys' fees, incurred by
Funding, TCHI, or the Partnership, as the case may be, in connection with the
transactions contemplated by this Agreement and the other Documents; and
(f) all fees and expenses (including reasonable fees and expenses of
counsel) in connection with any registration or qualification of the Senior
Notes for offer and sale hereunder under the securities or "blue sky" laws of
any jurisdiction requiring such registration or qualification or in connection
with obtaining any exemptions from such requirements.
2.6. Indemnification.
2.6.1. Scope of Indemnification.
In addition to all other sums due hereunder or provided for in this
Agreement or any of the other Documents and any and all obligations of TCHI,
Funding and the Partnership to indemnify the Funds hereunder or under any of the
other Documents, TCHI, Funding and the Partnership, jointly and severally,
shall, without limitation as to time, indemnify and hold harmless each Fund, its
Affiliates, and the employees, officers, directors, trustees, and agents of each
Fund and its Affiliates, including attorneys and consultants (individually, an
"Indemnified Party" and collectively, the "Indemnified Parties"), to the fullest
extent lawful, from and against any and all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable costs of
preparation and reasonable attorneys' fees) and expenses,
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including expenses of investigation (collectively, "Losses"), incurred by any
Indemnified Party, as a consequence of any claim by or obligation to a third
party which arises out of or in connection with this Agreement or the other
Documents or the transactions contemplated hereby or thereby (or any other
document or instrument executed herewith or pursuant hereto or thereto), whether
or not the transactions contemplated by this Agreement or such other Documents
are consummated and whether or not any Indemnified Party is a formal party to
any Proceeding; provided, however, that neither TCHI, Funding nor the
Partnership shall be liable to any Indemnified Party for any Losses (i)
resulting from a violation by such Indemnified Party of a legal restriction on
its investment powers, or (ii) to the extent that it shall be finally determined
by a court of competent jurisdiction (which determination is not subject to
appeal or review) that such Losses arose primarily out of the gross negligence
or willful misconduct of such Indemnified Party. Subject to the reimbursement
obligation set forth in the last sentence of Section 2.6.2 hereof, each of TCHI,
Funding and the Partnership agrees promptly to reimburse any Indemnified Party
for all such Losses as they are incurred and disclosed to TCHI, Funding and the
Partnership in writing by such Indemnified Party. The obligations of each of
TCHI, Funding and the Partnership to each Indemnified Party hereunder shall be
separate obligations, and the liability of each of TCHI, Funding and the
Partnership to any Indemnified Party hereunder shall not be extinguished solely
because any other Indemnified Party is not entitled to indemnity hereunder.
2.6.2. Indemnification Procedures.
If any proceeding shall be brought or asserted against any Indemnified
Party in respect of which indemnity may be sought from TCHI, Funding or the
Partnership hereunder, such Indemnified Party promptly shall notify TCHI or
Funding, as the case may be, and the Partnership in writing, and either TCHI or
Funding, as the case may be, or the Partnership, or both, shall assume the
defense thereof, including the employment of counsel reasonably satisfactory to
the Indemnified Party and the payment of all reasonable fees and expenses
incurred in connection with the defense thereof; provided, that the failure of
any Indemnified Party to give such notice shall not relieve either TCHI, Funding
or the Partnership of its obligations pursuant to this Agreement, except to the
extent that it shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or review) that such failure shall
have materially prejudiced TCHI, Funding or the Partnership, as indemnitor.
Any such Indemnified Party shall have the right to employ separate counsel
in any such action, claim or proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless: (1) TCHI, Funding or the Partnership has agreed
to pay such fees and expenses; or (2) TCHI, Funding or the Partnership has
failed promptly to assume the defense of such action, claim or proceeding and to
employ counsel reasonably satisfactory to such Indemnified Party in any such
action, claim or proceeding; or (3) the named parties to any such action, claim
or proceeding (including any impleaded parties) include both such Indemnified
Party and TCHI, Funding or the Partnership,
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and such Indemnified Party shall have been advised by counsel that a conflict of
interest may exist if the same counsel represents such Indemnified Party and
TCHI, Funding or the Partnership (and in the case of any of (1), (2) or (3), if
such Indemnified Party notifies TCHI, Funding and the Partnership in writing
that it elects to employ separate counsel at the expense of TCHI or Funding, as
applicable, and the Partnership, TCHI, Funding and the Partnership shall not
have the right to assume the defense thereof and the reasonable fees and
expenses of such counsel shall be at the expense of TCHI or Funding, as
applicable, and the Partnership); provided, however, that, so long as no
conflict of interest exists between any Indemnified Party and any other
Indemnified Party, TCHI or Funding, as applicable, and the Partnership shall not
be obligated to pay the fees and expenses of more than one separate lead counsel
(and one local counsel) for all Indemnified Parties. TCHI or Funding, as
applicable, and the Partnership shall have the right to employ separate counsel
in, and to participate in the defense of, any action or proceeding with respect
to which it has no right to assume the defense, but the fees and expenses of
such counsel shall be at the expense of TCHI or Funding, as applicable, and the
Partnership. No Indemnified Party will be subject to any liability for any
settlement made without its consent (but such consent will not be unreasonably
withheld). Neither TCHI, Funding nor the Partnership shall consent to the entry
of any judgment or enter into any settlement that does not include as an
unconditional term thereof the giving by the claimant or plaintiff to the
Indemnified Party of a release, in form and substance satisfactory to the
Indemnified Party, from all liability in respect of such action, claim or
proceeding for which such Indemnified Party would be entitled to indemnification
hereunder (whether or not any Indemnified Party is a party thereto). All fees
and expenses of the Indemnified Party (including reasonable fees and expenses to
the extent incurred in connection with investigating or preparing to defend such
action or proceeding in a manner not inconsistent with this Section 2.6) shall
be paid to the Indemnified Party, as incurred, upon written notice thereof to
TCHI or Funding, as applicable, or the Partnership; provided, that TCHI, Funding
or the Partnership may require such Indemnified Party to undertake to reimburse
all such fees and expenses to the extent it is finally judicially determined by
a court of competent jurisdiction (which determination is not subject to appeal
or review) that such Indemnified Party is not entitled to indemnification
hereunder.
2.7. Contribution.
2.7.1. Indemnification Provisions Unenforceable.
If a claim by an Indemnified Party for indemnification under Section 2.6
hereof is found unenforceable in a final judgment by a court of competent
jurisdiction (not subject to further appeal or review) even though the express
provisions hereof provide for indemnification in such case, then TCHI, Funding
and the Partnership, jointly and severally, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses in such proportion as is
appropriate to reflect the relative fault of TCHI, Funding or the Partnership,
on the one hand, and such Indemnified Party, on the other hand, in connection
with the actions, statements or omissions that resulted
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in such Losses as well as any other relevant equitable considerations. The
relative fault of TCHI, Funding or the Partnership, on the one hand, and any
Indemnified Party, on the other hand, shall be determined by reference to, among
other things, whether any action in question, including any untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact, has been taken by, or relates to information supplied by, TCHI,
Funding or the Partnership, on the one hand, or such Indemnified Party, on the
other hand, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent any such action, statement or omission.
The amount paid or payable by a party as a result of any Losses shall be deemed
to include any legal or other fees or expenses incurred by such party in
connection with any proceeding.
2.7.2. No Pro Rata Allocation.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 2.7 were determined by pro rata allocation
or by any other method of allocation that does not account for the equitable
considerations referred to in Section 2.7.1 hereof. Notwithstanding the
provisions of this Section 2.7, no Indemnified Party shall be required to
contribute any amount in excess of the amount by which the price at which the
Senior Notes sold by such Indemnified Party and distributed to the public
exceeds the amount of any damages that such Indemnified Party has otherwise been
required to pay by reason of such statement or omission. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who is not
guilty of such fraudulent misrepresentation.
2.7.3. Survival of Obligations.
The obligations of TCHI, Funding and the Partnership under Section 2.6 and
this Section 2.7 shall survive the payment or prepayment of the Senior Notes, at
maturity, upon redemption or otherwise, any transfer of the Senior Notes by the
Funds, and any termination of this Agreement or the other Documents.
2.8. Further Actions.
During the period from the date hereof to the Closing Date, TCHI, Funding
and the Partnership shall take all actions reasonably necessary or appropriate
to cause its representations and warranties contained in Section 5 hereof to be
true and correct in all material respects as of the Closing Date, after giving
effect to the transactions contemplated by this Agreement, as if made on and as
of such date.
SECTION 3. CLOSING CONDITIONS
3.1. Conditions to the Funds' Obligations.
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Each Fund's obligation to purchase and pay for the Senior Notes to be
purchased by it at the Closing shall be subject to the satisfaction of the
following conditions on or prior to the Closing Date:
3.1.1. Opinion of Counsel.
The Funds shall have received opinions, dated the Closing Date and
addressed to the Funds, from each of (i) Willkie Farr & Gallagher, counsel to
TCHI, Funding and the Partnership, (ii) Graham, Curtin & Sheridan, a
Professional Association, New Jersey real property counsel to TCHI, Funding and
the Partnership and (iii) Sterns & Weinroth, gaming counsel to TCHI, Funding and
the Partnership, substantially in the form set forth in Exhibits I, J and K
hereto, respectively.
3.1.2. Officers' Certificates.
(a) The Funds shall have received a certificate or certificates, dated the
Closing Date and signed by each of (x) the Chief Executive Officer or the Chief
Financial Officer of Funding and (y) the Chief Executive Officer or Chief
Financial Officer of TCHI certifying (i) that the conditions set forth in
Sections 3.1.3 through 3.1.5, 3.1.8, 3.1.10 and 3.1.11 hereof have been
satisfied on and as of such date and (ii) as to such other matters as any Fund
may reasonably request.
(b) The Funds shall have received a certificate, dated the Closing Date
and signed by the Secretary of Funding and TCHI, certifying such matters as the
Funds may reasonably request.
3.1.3. Issue of Senior Notes.
(a) Simultaneously with the sale to each Fund of the Funding Notes to be
purchased by it at the Closing, Funding shall have issued and delivered and
received payment for the Funding Notes to be purchased by the other Funds
hereunder, and TCHI shall have issued and delivered and received payment for the
TCHI Notes to be purchased by each Fund hereunder.
(b) Simultaneously with the sale to each Fund of the TCHI Notes to be
purchased by it at the Closing, TCHI shall have issued and delivered and
received payment for the TCHI Notes to be purchased by the other Funds
hereunder, and Funding shall have issued and delivered and received payment for
the Funding Notes to be purchased by each Fund hereunder.
3.1.4. Representations and Warranties True; No Event of Default.
The representations and warranties of TCHI, Funding and the Partnership
contained herein and in each of the other Documents shall be true and correct in
all material respects at
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and as of the Closing Date, after giving effect to the transactions contemplated
by this Agreement and the other Documents, as if made on and as of such date.
There shall exist at and as of the Closing Date (after giving effect to the
transactions contemplated by this Agreement and the other Documents) no Default
or Event of Default.
3.1.5. Compliance with Agreements.
TCHI, Funding and the Partnership shall have performed and complied in all
material respects with all agreements, covenants and conditions contained in
this Agreement and in the other Documents that are required to be performed or
complied with by TCHI, Funding and the Partnership on or before the Closing
Date.
3.1.6. Purchase Permitted by Applicable Laws; Legal Investment.
Each Fund's purchase of and payment for the Senior Notes to be purchased
by it (a) shall not be prohibited by any applicable law or governmental
regulation, release, interpretation or opinion (including, without limitation,
Regulations G, T, U and X of the Board of Governors of the Federal Reserve
System), (b) shall not subject any Fund to any penalty or other materially
onerous condition under or pursuant to any applicable law or governmental
regulation (other than the New Jersey Casino Control Act), and (c) shall be
permitted by the laws and regulations of the jurisdictions to which you are
subject. TCHI, Funding and the Partnership shall have delivered to each Fund
factual certificates or other evidence as each Fund shall reasonably request, in
form and substance reasonably satisfactory to such Fund, to enable such Fund to
establish compliance with this condition.
3.1.7. The Indentures, the Registration Rights Agreement and the
Security Documentation.
(a) Funding, the Partnership and U.S. Bank National Association, as
trustee, shall have duly entered into the Funding Note Indenture, and the Funds'
counsel shall have received counterparts, conformed as executed, of the Funding
Note Indenture.
(b) TCHI, the Partnership and U.S. Bank National Association, as trustee,
shall have duly entered into the TCHI Note Indenture, and the Funds' counsel
shall have received counterparts, conformed as executed, of the TCHI Note
Indenture.
(c) TCHI, Funding and the Partnership shall have duly executed and
delivered to the Funds the Registration Rights Agreement.
(d) Each of TCHI, Funding and the Partnership shall have duly executed and
delivered to the Trustee the Security Documentation and each of the other
Documents to which it is a party and shall have taken such action to perfect the
security interests granted in the Security Documents as the Funds shall have
requested.
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(e) The Intercreditor Agreement shall have been duly executed and
delivered by each Person party thereto.
3.1.8. Consents and Permits.
TCHI, Funding and the Partnership shall have received all consents,
permits and other authorizations, and made all such filings and declarations, as
may be required pursuant to any Applicable Law, for consummation of the
transactions contemplated by this Agreement and the other Documents, including
the issuance and sale of the Senior Notes to the Funds, and pursuant to all
other agreements, orders and decrees to which any of them is a party or to which
any of them is subject, in connection with the transactions to be consummated on
or prior to the Closing Date contemplated by this Agreement and the other
Documents.
3.1.9. Proceedings Satisfactory.
All corporate proceedings taken in connection with the sale of the Senior
Notes and all documents relating thereto, shall be reasonably satisfactory in
form and substance to the Funds. The Funds and Ropes & Gray shall have received
copies of such documents as they may reasonably request in connection with the
Closing, or as a basis for the Closing opinions, all in form and substance
reasonably satisfactory to the Funds and their special counsel. Each Document
shall be reasonably satisfactory in form and substance to the Funds.
3.1.10. No Material Adverse Change.
Since December 31, 1997 there shall not have occurred any material adverse
change in the operations, business, properties, prospects, condition (financial
or otherwise) or results of operations of TCHI, Funding and the Partnership,
taken as a whole. There shall have been no material adverse change in the
Partnership's ability to operate the Trump Marina Hotel Casino as described in
the Most Recent 10-K.
3.1.11. No Material Judgment or Order.
There shall not be on the Closing Date any judgment or order of a court of
competent jurisdiction or any ruling of any agency of the Federal, state or
local government that, in the reasonable judgment of the Funds or the Funds'
special counsel, would prohibit the sale or issuance of the Senior Notes
hereunder or subject TCHI, Funding, the Partnership or any Fund to any material
penalty if the Senior Notes were to be issued and sold hereunder.
3.2. Conditions to the Obligations of Funding and TCHI.
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The obligations of Funding to sell the Funding Notes to be delivered to
the Funds at the Closing and the obligations of TCHI to sell the TCHI Notes to
be delivered to the Funds at the Closing shall be subject to the satisfaction of
the following conditions:
3.2.1. Sale of Senior Notes.
The Funds shall have delivered payment to (i) Funding, in respect of the
several purchases of the Funding Notes, in an aggregate amount of $62,000,000
and (ii) to TCHI, in respect of the several purchases of the TCHI Notes, in an
original aggregate amount of $5,000,000.
3.2.2. Funds' Representations and Warranties.
Each Fund's payment of the purchase price for the Senior Notes purchased
by it at the Closing shall constitute a certification by such Fund that all of
its representations and warranties made herein and in the other Documents shall
be true and correct in all material respects at and as of the Closing Date,
after giving effect to the transactions contemplated by this Agreement and the
other Documents, as if made at and as of such date.
3.2.3. No Material Judgment or Order.
There shall not be on the Closing Date any judgment or order of a court of
competent jurisdiction or any ruling of any agency of the Federal, state or
local government that, in the reasonable judgment of TCHI, Funding and the
Partnership, would prohibit the sale or issuance of the Senior Notes hereunder
or subject TCHI, Funding or the Partnership to any material penalty if the
Senior Notes were to be issued and sold hereunder.
3.2.4. The Sale by Funding and TCHI Permitted by Applicable Laws.
The sale by Funding of the Funding Notes and by TCHI of the TCHI Notes and
the Funds' payment for the Senior Notes to be purchased by the Funds (a) shall
not be prohibited by any applicable law or governmental regulation, release,
interpretation or opinion (including, without limitation, Regulation G, T, U or
X of the Board of Governors of the Federal Reserve System), (b) shall not
subject TCHI, Funding or the Partnership to any penalty under or pursuant to any
applicable law or governmental regulation, and (c) shall be permitted by the
laws and regulations of the jurisdictions to which TCHI, Funding or the
Partnership are subject.
3.2.5. Consents and Permits.
Each Fund shall have received all consents, permits and other
authorizations, and made all such filings and declarations, as may be required
pursuant to any law, statute, regulation or rule (Federal, state, local and
foreign), contemplated by this Agreement and the other
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Documents, including the purchase of the Senior Notes by such Fund, and pursuant
to all other agreements, orders and decrees to which such Fund is a party or to
which such Fund is subject, in connection with the transactions to be
consummated on or prior to the Closing Date contemplated by this Agreement and
the other Documents.
SECTION 4. THE FUNDS' SPECIAL RIGHTS.
The provisions of this Section 4 shall apply with respect to each
Privately Outstanding Note and shall remain in effect so long as any of the
Senior Notes are Privately Outstanding Notes.
4.1. Delivery Expenses.
If a holder of a Privately Outstanding Note surrenders such Senior Note to
TCHI or Funding, as applicable, or the Trustee for substitution, replacement or
exchange, Funding, in the case of the Funding Notes, or TCHI, in the case of the
TCHI Notes, will pay the cost of delivering to and from such holder's home
office (or to and from the office of such holder's designee(s)) and the office
of Funding, TCHI or the Trustee, as the case may be, insured to such holder's
satisfaction, the surrendered Senior Note and each Senior Note issued in
substitution, replacement or exchange therefor.
4.2. Issue Taxes.
Funding and TCHI shall pay all stamp, transfer and other similar taxes and
governmental fees in connection with (a) the issuance, sale, delivery or
transfer by Funding and TCHI of the Privately Outstanding Notes, (b) the
execution and delivery of the Documents, (c) any modification of the Documents
and (d) the consummation of an Exchange Offer as defined in the Funding Note
Indenture and the TCHI Indenture. Funding, TCHI and the Partnership will hold
each holder of Privately Outstanding Notes harmless, without limitation as to
time, against any and all liabilities with respect to all such taxes and fees.
The obligations of Funding, TCHI and the Partnership under this Section 4.2
shall survive the payment or prepayment of the Senior Notes, at maturity, upon
redemption or otherwise, any transfer of the Senior Notes by the holder thereof,
and the termination of this Agreement.
4.3. Direct Payment.
TCHI, Funding and the Partnership shall instruct the Trustee to pay or
cause to be paid all interest payments with respect to any Privately Outstanding
Note (without any presentment of such Note and without any notation of such
payment being made thereon) by crediting such amount, before 12:00 Noon, New
York time, on the date such amount is payable, by Federal funds bank wire
transfer in same day available funds, to the registered holder's account in any
bank in the United States of America as may be designated by such holder or such
nominee(s),
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<PAGE>
as the case may be, not less than two Business Days prior to such payment. The
initial bank account for this purpose is set forth on Annex E hereof. Each Fund
shall be responsible for advising Funding, in the case of the Funding Notes, or
TCHI, in the case of the TCHI Notes, of any changes in its designated bank
account, and Funding, TCHI and the Partnership shall not have any responsibility
for delays in transfers because of any registered holder's failure to advise
Funding or TCHI, as the case may be, of any such change. Each Fund agrees,
before any sale, transfer or other disposition of any Note that is a Privately
Outstanding Note, to make a notation thereon, or submit the same to the Trustee
under the Funding Note Indenture, in the case of a Funding Note, or under the
TCHI Note Indenture, in the case of an TCHI Note, for notation thereon, of the
date to which interest has been paid thereon and the amount of all redemption
payments previously made in respect thereof.
4.4. Inspection.
Funding, TCHI and the Partnership will permit any person designated by any
of the holders of record of the Privately Outstanding Notes in writing and
reasonably acceptable to Funding, TCHI or the Partnership, at such designating
holder's expense, upon reasonable notice during normal business hours, to visit
and inspect any of the properties (subject to reasonable security procedures
customarily required by Funding, TCHI or the Partnership), the corporate books
or financial records of TCHI, Funding, the Partnership and its Subsidiaries, and
to discuss their affairs, finances and accounts with the principal officers of
Funding, TCHI or the Partnership and its Subsidiaries and (with notice to the
Partnership) their independent public accountants, all at such reasonable times
and as often as such holder may reasonably request. Each such holder agrees that
any information obtained by it as a result of such visits, inspections and
discussions or pursuant to this Agreement shall be confidential and shall be
kept confidential by such holder, unless (i) disclosure of such information is
required by law or by court or administrative order, provided that prior to
disclosing any confidential information pursuant to this clause, such holder
agrees to provide notice to Funding or TCHI, as applicable, or the Partnership
and to reasonably cooperate with Funding or TCHI, as applicable, or the
Partnership in any contest of such disclosure, (ii) such information becomes
available to the public other than as a result of a disclosure or failure to
safeguard by such holder, or (iii) such information becomes available to such
holder from a source, other than TCHI, Funding or the Partnership, which source
such holder reasonably believes is not subject to a confidentiality agreement
which prohibited such disclosure.
4.5. Financial Statements.
4.5.1. Delivery.
Funding, TCHI and the Partnership will deliver or cause the Trustee to
deliver to each holder of Privately Outstanding Notes the financial statements
and other information described by Section 10.18 of the Funding Note Indenture
and Section 10.18 of the TCHI Note Indenture in the time periods and manner
prescribed therein.
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<PAGE>
4.5.2. Disclosure; Officer's Certificate.
Each financial statement of Funding, TCHI or the Partnership delivered
pursuant to this Section 4.5 shall disclose the amount available for Restricted
Payments (as defined in the Funding Note Indenture and the TCHI Note Indenture)
pursuant to Section 10.9 of the Funding Note Indenture and the TCHI Note
Indenture, and shall be accompanied by a certificate of an officer of Funding
and TCHI stating that (x) such officers do not have knowledge of the existence
during or at the end of such accounting period of any condition or event that
constitutes an Event of Default or Default, or (y) if such condition or event
existed or then currently exists, specifying the nature and period of existence
thereof and what action Funding, TCHI or the Partnership has taken, is taking,
or proposes to take in connection therewith.
4.5.3. Additional Information.
Funding or TCHI, as applicable, or the Partnership shall, from time to
time, deliver such additional information regarding the financial position or
business of Funding, TCHI or the Partnership as the holders of a majority of the
outstanding principal amount of the Privately Outstanding Notes may reasonably
request, subject in each case to the confidentiality provisions set forth in
Section 4.4 hereof.
4.6. ERISA Compliance.
Promptly upon becoming aware of any (i) "reportable event" (as defined in
section 4043(b) of ERISA) for which the giving of notice to the Pension Benefit
Guaranty Corporation has not been waived, (ii) "complete withdrawal" or "partial
withdrawal" (within the meaning of sections 4203 and 4205 of ERISA) from a
"Multiemployer Plan" (as defined in section 3(37) of ERISA), (iii) "prohibited
transaction" (as defined in section 406 of ERISA or section 4975 of the Code),
(iv) "accumulated funding deficiency" (as defined in section 412 of the Code),
(v) lien (within the meaning of section 412(n) of the Code or section 302(f) of
ERISA), or (vi) requirement to provide security under section 401(a)(29) of the
Code or section 307 of ERISA in connection with any "employee benefit plan"
maintained or contributed to by the Partnership or, with respect to clauses (i),
(ii), (iv) or (v), any of its "controlled group" (as defined in section
4001(a)(14) of ERISA for purposes of clause (i) and (ii) and section
414(b),(c),(m) or (o) of the Code for purposes of clauses (iv) and (v), and
hereinafter referred to as "ERISA Affiliates") or any trust created thereunder,
that may reasonably be expected to, singly or in the aggregate, result in a
liability that could have a Material Adverse Effect, the Partnership shall
furnish to each holder of Privately Outstanding Notes a written notice
specifying the nature thereof and what action the Partnership, the Internal
Revenue Service, the Pension Benefit Guaranty Corporation or any other relevant
party is taking or proposes to take with respect thereto.
4.7. No Bond Necessary.
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<PAGE>
No holder of Privately Outstanding Notes shall be required to post any
bond (but such holder may be required to enter into an indemnity agreement, at
the request of Funding or TCHI, as applicable, reasonably satisfactory to
Funding or TCHI, as applicable, and the Trustee) if such holder certifies that a
Privately Outstanding Note has been lost, destroyed or wrongfully taken and
demands that Funding or TCHI issue and the Trustee authenticates a replacement
Note.
SECTION 5. REPRESENTATIONS AND WARRANTIES.
Each of TCHI, Funding and the Partnership jointly and severally represents
and warrants to each of the Funds as follows:
5.1. Organization, Standing and Qualification.
5.1.1. Organization; Standing.
Funding is a corporation duly organized and validly existing under the
laws of the State of New Jersey. Funding has all requisite power and authority
to carry on its business as now conducted and as proposed to be conducted.
TCHI is a corporation duly organized and validly existing under the laws
of the State of New Jersey. TCHI has all requisite power and authority to carry
on its business as now conducted and as proposed to be conducted. TCHI is
engaged in no other business other than serving as the general partner of the
Partnership, and its only asset (other than the Senior Partnership Upstream Note
and the Security Documentation executed in connection therewith) is its
partnership interest in the Partnership. Except as directly related to serving
as the general partner of the Partnership and as contemplated by this Agreement,
the Security Documentation and the Documents, TCHI has no liabilities.
The Partnership is a limited partnership existing under the laws of the
State of New Jersey. The Partnership has all requisite power and authority to
own or lease, and operate its properties and assets, and to carry on its
business as now conducted and as proposed to be conducted; and is duly qualified
or licensed to do business and is in good standing in all jurisdictions in which
it owns or leases property or in which the conduct of its business requires it
so to qualify or be licensed, except where the failure so to qualify would not,
singly or in the aggregate, have a Material Adverse Effect.
5.1.2. Authority.
Each of TCHI, Funding and the Partnership has all requisite power and
authority to enter into and perform all of its respective obligations under this
Agreement and the other Documents to which it is a party, to issue, sell, and
deliver the Senior Notes, and to carry out the transactions contemplated by this
Agreement or any other Document to which it is a party.
-23-
<PAGE>
5.2. Authorization of Agreement and Other Documents.
Each of TCHI, Funding and the Partnership has taken all action necessary
to authorize it to enter into and perform its obligations under each of this
Agreement and the other Documents to which it is a party and to consummate the
transactions contemplated hereby and thereby (including, without limitation, the
issuance and sale of the Senior Notes). This Agreement is, and, as of the
Closing Date and each of the Documents to which TCHI, Funding or the Partnership
is a party will be, a legal, valid and binding obligation of TCHI, Funding or
the Partnership, as the case may be, enforceable against TCHI, Funding or the
Partnership, as the case may be, in accordance with its terms, except as such
enforcement may be subject to (i) applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws now or hereafter
affecting creditors' rights and remedies generally and (ii) general principles
of equity (regardless of whether such enforcement is sought in a proceeding in
equity or at law) and (iii) the New Jersey Casino Control Act and the
regulations promulgated thereunder.
5.3. No Violation.
5.3.1. Existing Violations.
Neither TCHI, Funding nor the Partnership is (i) in violation of its
respective Charter Documents or (ii) in default in the performance of any
obligation, agreement or condition contained in any bond, debenture, note or any
other evidence of indebtedness or in any indenture, mortgage, deed of trust or
any other agreement or instrument to which any of them is a party other than
such defaults that could not, singly or in the aggregate, reasonably be expected
to result in a Material Adverse Effect. There exists no condition that, with the
passage of time or otherwise, would constitute a violation of such Charter
Documents or a default under any such document or instrument or result in the
imposition of any penalty or the acceleration of any indebtedness or other
obligation other than such defaults that would not, singly or in the aggregate,
result in a Material Adverse Effect.
5.3.2. Execution of Agreement.
Neither the execution or delivery by TCHI, Funding or the Partnership of
this Agreement or the other Documents to which it is a party, the issuance, sale
or delivery of the Senior Notes, the performance by TCHI, Funding or the
Partnership of its obligations pursuant to this Agreement and the other
Documents, nor the consummation of the transactions contemplated hereby or
thereby will conflict with, violate, constitute a breach of or a default (with
the passage of time or otherwise) under, require the consent of any Person
(other than consents already obtained) under, result in the imposition of any
penalty, or result in the imposition of a Lien (other than pursuant to the
Security Documentation and Liens permitted under the Funding Note Indenture and
the TCHI Note Indenture) on any properties of TCHI, Funding or the Partnership
or an acceleration of indebtedness or other obligation pursuant to,
-24-
<PAGE>
(i) the Charter Documents of TCHI, Funding or the Partnership, (ii) any bond,
debenture, note or any other evidence of indebtedness or any indenture,
mortgage, deed of trust or any other agreement or instrument to which TCHI,
Funding or the Partnership is a party or by which it is bound or to which any of
its property or assets is subject, or (iii) any Applicable Law, except in any
case where such violation, default, breach or conflict, or the absence of such
consent or the creation of such Lien, would not, singly or in the aggregate,
result in a Material Adverse Effect.
5.4. No Default.
Were the Funding Note Indenture, the TCHI Note Indenture, the Registration
Rights Agreement and the Security Documentation in effect as of the date hereof,
after giving effect to the transactions contemplated hereby, including
application of proceeds from the sale of the Senior Notes, there would be no
Default or Event of Default thereunder or breach thereof.
5.5. Full Disclosure.
The Most Recent 10-K, including the financial statements included therein,
complies with all applicable provisions of the Exchange Act in all material
respects and contains all statements required to be stated therein in accordance
with the Exchange Act. None of the Most Recent 10-K, this Agreement or any of
the other Documents contained, as of its respective date, or would now contain
were the information contained therein made available to you as of the date of
this Agreement, any untrue statement of a material fact or as of such date
omitted, or now omits, to state a material fact necessary to make the statements
contained herein or therein, when taken as a whole in light of the circumstances
under which they were made, not misleading.
5.6. ERISA.
The execution and delivery of this Agreement, the other Documents and the
sale of the Senior Notes to be purchased by the Funds do not involve any
"prohibited transaction" by TCHI, Funding or the Partnership. Neither TCHI,
Funding nor the Partnership is a "party in interest" or a "disqualified person"
with respect to a qualified trust except as to those employee benefit plans set
forth on Schedule 2.3.3. No condition exists or event or transaction has
occurred in connection with any "employee benefit plan" maintained or
contributed to by TCHI, Funding or the Partnership or any of their ERISA
Affiliates (any plan being herein referred to as the "Pension Plan") that could
result in TCHI, Funding the Partnership or any such ERISA Affiliate incurring
any liability, fine or penalty which would, singly or in the aggregate, have a
Material Adverse Effect. With respect to any Pension Plan, other than a
Multiemployer Plan, that is subject to Title IV of ERISA, (a) the fair market
value of the assets of such Pension Plan equals or exceeds (and will equal or
exceed immediately subsequent to the consummation of the transactions
contemplated hereby) the present value of the liabilities of such Pension Plan
(as determined in accordance with the actuarial methods and assumptions
-25-
<PAGE>
set forth in the latest actuarial report for such Pension Plan), except where
the failure so to equal or exceed would not, singly or in the aggregate, have a
Material Adverse Effect and (b) there exists (and will exist immediately
subsequent to the consummation of the transactions contemplated hereby) no
accumulated funding deficiency.
The representation of TCHI, Funding and the Partnership in the first
sentence of the preceding paragraph is made in reliance upon, and is subject to,
the accuracy of each Fund's representations in section 2.3.3 hereof.
5.7. Compliance with Laws.
Neither TCHI, Funding nor the Partnership is in violation of any
Applicable Law, except such violations as may not, singly or in the aggregate,
have a Material Adverse Effect. Each of TCHI, Funding and the Partnership has
obtained and holds all licenses, permits, franchises and other governmental
authorizations necessary to the ownership or operation of its properties or the
conduct of its business as currently conducted, except such failures as would
not, singly or in the aggregate, have a Material Adverse Effect.
5.8. Consents.
No consent, approval or authorization of, or filing, registration or
qualification (including, without limitation, pursuant to the New Jersey Casino
Control Act) with, any Person or any governmental or regulatory authority or
body (including, without limitation, the New Jersey Casino Control Commission,
or any successor entity) is required in connection with or as a condition to the
execution and delivery of this Agreement or any of the other Documents or the
consummation of transactions contemplated hereby or thereby (including, without
limitation, the offer, issuance, sale or delivery of the Senior Notes at the
Closing), except for such (i) consents, approvals, authorizations, filings,
registrations or qualifications as have been made or obtained on or before the
Closing Date (and copies of which will be delivered to the Funds upon their
request), or are not required to be made or obtained prior to the Closing Date
and (ii) the filing of mortgages, financing statements and any other security
documents pursuant to the Security Documentation, and except to the extent that
the failure to obtain any such consents, approvals, authorizations or
qualifications or to make any such filings or registrations could not, singly or
in the aggregate, have a Material Adverse Effect.
5.9. No Violation of Regulations of Board of Governors of Federal Reserve
System.
None of the transactions contemplated by this Agreement (including,
without limitation, the use of the proceeds from the sale of the Senior Notes)
shall violate or result in a violation by TCHI, Funding or the Partnership of
Section 7 of the Exchange Act including, without limitation, Regulations G, T, U
and X of the Board of Governors of the Federal Reserve System. No part of the
proceeds of the sale of the Senior Notes will be used directly or
-26-
<PAGE>
indirectly for the purpose of purchasing or carrying any margin securities
within the meaning of Regulation G.
5.10. Private Offering.
5.10.1. Sale Exempt.
Assuming the correctness of the representations made by the Funds in
Section 2.3 hereof, the sale of the Senior Notes hereunder is exempt from the
registration and prospectus delivery requirements of the Securities Act and it
is not necessary in connection with the sale of the Senior Notes to the Funds in
accordance herewith to qualify the Funding Note Indenture or the TCHI Note
Indenture under the Trust Indenture Act of 1939, as amended.
5.10.2. No General Solicitation.
In the case of each offer or sale of the Senior Notes, no form of general
solicitation or general advertising was used by TCHI, Funding or the Partnership
or any of their officers, directors or employees including, but not limited to,
advertisements, articles, notices or other communications published in any
newspaper, magazine or similar medium or broadcast over television or radio, or
any seminar or meeting whose attendees had been invited by any general
solicitation or general advertising. No offers were made by TCHI, Funding or the
Partnership or any of their officers, directors or employees other than to
persons whom the offeror reasonably believed to be accredited investors or
sophisticated purchasers as those terms have been construed under Section 4(2)
of the Securities Act. The Funds are the sole purchasers of the Senior Notes. No
securities of the same class as any of the Senior Notes have been issued and
sold by the Company within the six-month period immediately prior to the date
hereof. Each of TCHI, Funding and the Partnership agrees that neither it nor
anyone acting on its behalf, will offer any Senior Notes so as to bring the
issuance and sale of any of the Senior Notes within the provisions of Section 5
of the Securities Act nor offer any similar securities for issuance or sale to,
or solicit any offer to acquire any of the same from, or otherwise approach or
negotiate with respect thereto with anyone if the sale of any of the Senior
Notes and any such securities could be integrated as a single offering for
purposes of the Securities Act.
5.11. Governmental Regulations.
Except for the required approval of the issuance and sale of the Senior
Notes by the New Jersey Casino Control Commission, which approval has been
obtained, neither TCHI, Funding nor the Partnership is subject to regulation, or
will become subject to regulation upon the consummation of the transactions
contemplated by this Agreement or any of the other Documents, under the
Investment Company Act of 1940, as amended, or any Federal or state statute or
regulation limiting its ability to incur or assume indebtedness for borrowed
money or consummate the transactions contemplated hereby.
-27-
<PAGE>
5.12. Survival of Indemnification and Contribution and Representations and
Warranties.
All of the representations and warranties of TCHI, Funding and the
Partnership in this Agreement, the Most Recent 10-K and the other Documents and
in any other document, financial statement or other instrument or certificate
delivered to the Funds by or on behalf of TCHI, Funding or the Partnership in
connection with this Agreement and the Documents and the transactions
contemplated hereby and thereby shall be deemed to constitute representations
and warranties hereunder and shall be true in all material respects at and as of
the Closing Date, after giving effect to the transactions contemplated hereby.
All of the obligations to indemnify the Funds and contribute to the Funds'
losses contained in this Agreement and the other Documents and in any other
document, financial statement or other instrument or certificate delivered to
the Fund by or on behalf of TCHI, Funding or the Partnership in connection with
this Agreement and the Documents and the transactions contemplated hereby and
thereby and all of the representations and warranties of TCHI, Funding or the
Partnership shall survive the execution and delivery of this Agreement and the
other Documents, any investigation by the Funds and the issuance of the Senior
Notes.
SECTION 6. MISCELLANEOUS.
6.1. Notices.
All notices and other communications provided for or permitted under this
Agreement shall be made in writing by hand-delivery, next-day air courier,
certified first-class mail, return receipt requested, telex, or facsimile:
(a) if to any Fund, at its address set forth on the first page of this
Agreement, with a copy to Ropes & Gray, One International Place, Boston,
Massachusetts 02110, Attention: Robert L. Nutt, Esq (provided that payment
notices shall be sent to the address indicated for each Fund on Annex E); and
(b) if to TCHI, Funding or the Partnership, at its address set forth on
the first page of this Agreement, with a copy to (i) if prior to May 26, 1998,
Willkie Farr & Gallagher, One Citicorp Center, 153 East 53rd Street, New York,
New York 10022, Attention: Daniel D. Rubino, Esq. or (ii) if on or after May 26,
1998, Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New York
10019-6099, Attention: Daniel D. Rubino, Esq.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; one business day after
being timely delivered to a next-day air courier; five business days after being
deposited in the mail, postage prepaid, if mailed; when answered back if
telexed; and when receipt is acknowledged by the recipient's telecopier machine,
if telecopied.
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<PAGE>
6.2. Successors and Assigns.
This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties, and to the extent set forth in
Sections 2.6 and 2.7 hereof, the Indemnified Parties and their respective heirs,
personal representatives, successors and assigns, and no other persons shall
acquire or have any right under or by virtue of this Agreement.
6.3. Amendment and Waiver.
Prior to the Closing Date, this Agreement and the other Documents may be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may be given, provided that the same are in writing and
signed by the Funds and the Partnership. Thereafter, this Agreement may only be
amended, and such waivers be given, with the consent of the holders of a
majority of the then outstanding aggregate principal amount of the Funding Notes
(other than Funding Notes owned or acquired by Funding, the Partnership or any
of their Affiliates) and the consent of the holders of a majority of the
outstanding aggregate principal amount of the TCHI Notes (other than the TCHI
Notes owned or acquired by TCHI, Funding, the Partnership or any of their
Affiliates).
6.4. Counterparts.
This Agreement may be executed in any number of counterparts and by the
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.
6.5. Headings.
The headings in this Agreement are for convenience of reference only and
shall not limit or otherwise affect the meaning hereof.
6.6. Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH OF
TCHI, FUNDING AND THE PARTNERSHIP HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION
OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW
YORK, OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK
IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
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<PAGE>
COURTS. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY FUND TO SERVE PROCESS IN
ANY MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST TCHI, FUNDING OR THE PARTNERSHIP IN ANY OTHER JURISDICTION.
6.7. Entire Agreement.
This Agreement, together with the other Documents and the Senior Notes,
are intended by the parties as a final expression of their agreement and
intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained
herein and therein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein and therein. This
Agreement, together with the other Documents and the Senior Notes, supersedes
all prior agreements and understandings between the parties with respect to such
subject matter.
6.8. Severability.
If any term, provision, covenant or restriction of this Agreement is held
by a court of competent jurisdiction to be invalid, illegal, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their best efforts to find and employ an alternative means to achieve the same
or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.
If this Agreement is satisfactory to each of the Funds, please so indicate
by signing the acceptance on a counterpart of this Agreement and return such
counterpart to Funding whereupon this Agreement will become binding between us
in accordance with its terms.
<PAGE>
Very truly yours,
TRUMP'S CASTLE FUNDING, INC.
By: /s/ Nicholas L. Ribis
---------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
TRUMP'S CASTLE HOTEL & CASINO, INC.
By: /s/ Nicholas L. Ribis
---------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
TRUMP'S CASTLE ASSOCIATES, L.P.
By: TRUMP'S CASTLE HOTEL & CASINO,
INC., its General Partner
By: /s/ Nicholas L. Ribis
---------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
<PAGE>
Accepted and agreed to:
THE FUNDS LISTED ON ANNEX A HERETO
By: /s/ John R. Verani
----------------------------
Name: John R. Verani
Title: Vice President
PUTNAM INVESTMENT MANAGEMENT,
INC. ON BEHALF OF THE FUNDS AND
ACCOUNTS LISTED ON ANNEX B HERETO
By: /s/ John R. Verani
----------------------------
Name: John R. Verani
Title: Senior Vice President
PUTNAM FIDUCIARY TRUST COMPANY ON
BEHALF OF THE FUNDS AND ACCOUNTS
LISTED ON ANNEX C HERETO
By: /s/ John R. Verani
----------------------------
Name: John R. Verani
Title: Senior Vice President
THE PUTNAM ADVISORY COMPANY, INC. ON
BEHALF OF THE FUNDS AND ACCOUNTS
LISTED ON ANNEX D HERETO
By: /s/ John R. Verani
----------------------------
Name: John R. Verani
Title: Senior Vice President
<PAGE>
ANNEX A
Putnam Variable Trust - PVT High Yield Fund
Putnam Funds Trust - Putnam High Yield Trust II
Putnam Managed High Yield Trust
Putnam High Yield Trust
Putnam High Yield Advantage Fund
Putnam Strategic Income Fund
Putnam Diversified Income Trust
Putnam Variable Trust - PVT Diversified Income Fund
Putnam Master Income Trust
Putnam Premier Income Trust
Putnam Master Intermediate Income Trust
Putnam Asset Allocation Funds - Balanced Portfolio
Putnam Variable Trust - PVT Global Asset Allocation Fund
Putnam Asset Allocation Funds - Conservative Portfolio
Putnam Asset Allocation Funds - Growth Portfolio
Putnam The George Putnam Fund of Boston
Putnam Income Fund
Putnam Equity Income Fund
Putnam Balanced Retirement Fund
Putnam Funds Trust - Putnam High Yield Total Return Fund
Putnam High Income Convertible and Bond Fund
Putnam Convertible Opportunities and Income Trust
ANNEX B
Travelers Series Fund Inc. - Putnam Diversified Income Portfolio
ANNEX C
Putnam High Yield Managed Trust
Putnam High Yield Fixed Income Fund, LLC
ANNEX D
Ameritech Corporation Pension Plan
Dana Farber Cancer Institute
Abbott Laboratories Annuity Retirement Plan
Mobil Oil Corporation Retirement Plans
Strategic Global Fund - High Yield Fixed Income (Putnam) Fund
Ameritech Corporation Pension Plan
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<PAGE>
ANNEX E
FUNDS AND ACCOUNTS PURCHASING FUNDING NOTES AND TCHI NOTES
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
Fund Fund/Account Name Nominee Funding Note Funding TCHI Note TCHI Bank
Account Name Principal Note # Principal Note Account #
# Amount Amount #
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
017 Putnam Variable Trust - Muico & Co. $4,230,000 1 096186
PVT High Yield Fund
- ---------------------------------------------------------------------------------------------------------------
2HS Putnam Funds Trust - Muico & Co. $1,520,000 2 096181
Putnam High Yield Trust
II
- ---------------------------------------------------------------------------------------------------------------
590 Putnam Managed High Muico & Co. $430,000 3 096268
Yield Trust
- ---------------------------------------------------------------------------------------------------------------
205 Putnam High Yield Trust Muico & Co. $15,985,000 4 $2,500,000 1 096120
- ---------------------------------------------------------------------------------------------------------------
303 Putnam High Yield Muico & Co. $17,975,000 5 $2,500,000 2 096172
Advantage Fund
- ---------------------------------------------------------------------------------------------------------------
2BU Putnam Strategic Income Muico & Co. $310,000 6 096302
Fund
- ---------------------------------------------------------------------------------------------------------------
837 Putnam Diversified Muico & Co. $9,130,000 7 096200
Income Trust
- ---------------------------------------------------------------------------------------------------------------
963 Putnam Variable Trust - Muico & Co. $1,060,000 8 096274
PVT Diversified Income
Fund
- ---------------------------------------------------------------------------------------------------------------
807 Putnam Master Income Muico & Co. $830,000 9 096194
Trust
- ---------------------------------------------------------------------------------------------------------------
811 Putnam Premier Income Muico & Co. $2,090,000 10 096196
Trust
- ---------------------------------------------------------------------------------------------------------------
815 Putnam Master Muico & Co. $1,320,000 11 096198
Intermediate Income
Trust
- ---------------------------------------------------------------------------------------------------------------
099 Putnam Asset Allocation Muico & Co. $660,000 12 096280
Funds - Balanced
Portfolio
- ---------------------------------------------------------------------------------------------------------------
1GF Putnam Variable Trust - Muico & Co. $190,000 13 096192
PVT Global Asset
Allocation Fund
- ---------------------------------------------------------------------------------------------------------------
283 Putnam Asset Allocation Muico & Co. $220,000 14 096282
Funds - Conservative
Portfolio
- ---------------------------------------------------------------------------------------------------------------
502 Putnam Asset Allocation Muico & Co. $260,000 15 096278
Funds - Growth Portfolio
- ---------------------------------------------------------------------------------------------------------------
612 Putnam The George Muico & Co. $600,000 16 096100
Putnam Fund of Boston
- ---------------------------------------------------------------------------------------------------------------
774 Putnam Income Fund Muico & Co. $970,000 17 096106
- ---------------------------------------------------------------------------------------------------------------
897 Putnam Equity Income Muico & Co. $30,000 18 096118
Fund
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
-34-
<PAGE>
<TABLE>
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
978 Putnam Balanced Muico & Co. $90,000 19 096144
Retirement Fund
- ---------------------------------------------------------------------------------------------------------------
2DK Putnam Funds Trust - Muico & Co. $190,000 20 096109
Putnam High Yield
Total Return Fund
- ---------------------------------------------------------------------------------------------------------------
416 Putnam High Income Muico & Co. $210,000 21 096174
Convertible and Bond
Fund
- ---------------------------------------------------------------------------------------------------------------
763 Putnam Convertible Muico & Co. $200,000 22 096316
Opportunities and Income
Trust
- ---------------------------------------------------------------------------------------------------------------
979 Travelers Series Fund Barnett & $230,000 23 340120380513
Inc. - Putnam Diversified Co.
Income Portfolio
- ---------------------------------------------------------------------------------------------------------------
171 Putnam High Yield Bost & Co. $1,520,000 25 PUTF6520002
Managed Trust
- ---------------------------------------------------------------------------------------------------------------
1BS Putnam High Yield Fixed Bost & Co. $340,000 26 PUTF6921002
Income Fund, LLC
- ---------------------------------------------------------------------------------------------------------------
299 Ameritech Corporation Blazerhold $570,000 27 ER40
Pension Plan & Co.
- ---------------------------------------------------------------------------------------------------------------
1CW Dana Farber Cancer Bost & Co. $50,000 29 DANF020002
Institute
- ---------------------------------------------------------------------------------------------------------------
1FY Abbott Laboratories Booth & Co. $250,000 30 22-30838
Annuity Retirement Plan
- ---------------------------------------------------------------------------------------------------------------
1PU Mobil Oil Corporation Boston Safe $250,000 24 MOBF7731002
Retirement Plans Deposit Trust
Company for
Mobil Oil
Retirement
Trust
- ---------------------------------------------------------------------------------------------------------------
1SJ Strategic Global Fund - Booth & Co. $270,000 28 1745445
High Yield Fixed Income
(Putnam) Fund
- ---------------------------------------------------------------------------------------------------------------
1ME Ameritech Corporation Aircourse $20,000 31 ERAE
Pension Plan & Co.
- ---------------------------------------------------------------------------------------------------------------
TOTAL $62,000,000 5,000,000
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
-35-
<PAGE>
Tax ID numbers: Muico & Co. 13-6355402
Barnett & Co. 13-6051681
Bost & Co. 04-6013753
Blazerhold & Co. 04-3215995
Aircourse & Co. 04-3325765
Booth & Co. 36-6033750
Boston Safe Deposit Trust Company 13-6142612
for Mobil Oil Retirement Trust
Wire transfer instructions for future payments of interest and principal
Funds for which Muico & Co. is the Nominee:
Bankers Trust Company
ABA #021 001 033
Account #99911145
Reference: Muico & Co., Fund Account #, 10 1/4 Trump Funding/TCHI
Notes due 2003
Contact: Jim Collins (212-618-2175)
Travelers Series Fund Inc. - Putnam Diversified Income Portfolio:
PNC Bank
ABA# 031-000-053
DDA# 8511003437
REF: Travelers Series Fund, Inc.
Account #340120380513
Contact: Bob Sciubba (610) 521-7879
Putnam High Yield Managed Trust
Boston Safe Deposit & Trust
ABA# 011-001-234
DDA# 115762
Cost Center #8630
REF: Putnam High Yield Managed Trust
Acct. #PUTF6520002
Contact: Cindy Joel (617) 382-2665
Putnam High Yield Fixed Income Fund, LLC
Boston Safe Deposit & Trust Company
ABA# 011-001-234
DDA# 115762
Cost Center #8630
REF: Putnam High Yield Fixed Income
Acct. #PUTF8921002
Contact: Cindy Joel, Mellon Trust
(617) 382-2665
-36-
<PAGE>
Ameritech Corporation Pension Plan (Account 299)
State Street Bank and Trust Co.
ABA# 011-000-028
DDA# 01402999
REF: Ameritech Corp., Acct. #ER40
Contact: Sarah Hines (617) 985-1535
Dana Farber Cancer Institute
Boston Safe Deposit & Trust
ABA# 011-001-234
DDA# 125281
Cost Center #1253
REF: Dana Farber, Acct. #DNAF0200002
Contact: Enroy Pinnock, Mellon Trust
(617) 382-4748
Abbott Laboratories Annuity Retirement Plan
Northern Chicago/Trust
ABA# 071-000-152
A/C# 5166061000
REF: Abbott Labs, Acct. #22-30838
Contact: Kristen Wirtz, The Northern Trust Co. (312) 630-6425
Mobil Oil Corporation Retirement Plans
Boston Safe Deposit & Trust
ABA# 011-001-234
DDA# 125261
Cost Center #1253
REF: Mobil Oil, Acct. #MOBF7731002
Contact: Enroy Pinnock, Mellon Trust (617) 382-4746
Strategic Global Fund - High Yield
Northern Chicago/Trust
ABA# 071-000-152
A/C# 5188061000
REF: Strategic Global, Acct. #1745445
Contact: Mike Campagna (312) 444-5765
Ameritech Corporation Pension Plan (Account 1ME)
State Street Bank and Trust Co.
ABA# 011-000-028
DDA# 01403583
REF: Ameritech Corp., Acct. #ERAE
Contact: Sarah Hines (617) 985-1535
-37-
<PAGE>
SCHEDULE 2.3.3
TO
NOTE PURCHASE AGREEMENT
1. Trump Marina Hotel & Casino Retirement and Savings Plan
2. Trump Plaza Hotel & Casino Retirement Savings Plan
3. Trump Taj Mahal Casino Resort Retirement Savings Plan
4. Trump Casino Services Retirement and Savings Plan
5. Trump Indiana Retirement and Savings Plan.
Execution Copy
TRUMP'S CASTLE HOTEL & CASINO, INC., as Issuer
U.S. BANK NATIONAL ASSOCIATION, as Trustee
TRUMP'S CASTLE ASSOCIATES, L.P., as Guarantor
-----------------
INDENTURE
Dated as of April 17, 1998
-----------------
$5,000,000
10 1/4% Senior Secured Notes due 2003
<PAGE>
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION ............. 1
Section 1.1 Definitions ..................................... 2
Section 1.2 Other Definitions ............................... 20
Section 1.3 Compliance Certificates and Opinions ............ 20
Section 1.4 Form of Documents Delivered to Trustee .......... 21
Section 1.5 Acts of Holders ................................. 22
Section 1.6 Notices, etc., to Trustee, the Issuer, the
Partnership, the CCC and the NJDGE ............................ 23
Section 1.7 Notice to Holders; Waiver ....................... 23
Section 1.8 Conflict with Trust Indenture Act ............... 24
Section 1.9 Effect of Headings and Table of Contents ........ 24
Section 1.10 Successors and Assigns .......................... 24
Section 1.11 Separability Clause ............................. 24
Section 1.12 Benefits of Indenture ........................... 24
Section 1.13 GOVERNING LAW ................................... 25
Section 1.14 Casino Control Act .............................. 25
Section 1.15 Legal Holidays .................................. 25
Section 1.16 Schedules ....................................... 25
Section 1.17 Counterparts .................................... 25
ARTICLE 2
FORM OF SENIOR NOTES ................................................ 25
Section 2.1 Forms Generally ................................. 25
Section 2.2 Form of Face of the Senior Notes ................ 26
Section 2.3 Form of Reverse of the Senior Notes ............. 29
Section 2.4 Form of Trustee's Certificate of Authentication . 32
Section 2.5 Form of Senior Guarantee ........................ 32
ARTICLE 3
THE SENIOR NOTES .................................................... 33
Section 3.1 Title and Terms ................................. 33
Section 3.2 Denominations ................................... 35
Section 3.3 Execution, Authentication, Delivery and Dating .. 35
Section 3.4 Temporary Securities ............................ 36
Section 3.5 Registration, Registration of Transfer
and Exchange .................................................. 37
Section 3.6 Mutilated, Destroyed, Lost and Stolen Senior
Notes ......................................................... 39
Section 3.7 Payment of Interest ............................. 39
-2-
<PAGE>
Section 3.8 Persons Deemed Owners ........................... 41
Section 3.9 Cancellation .................................... 41
Section 3.10 Computation of Interest ......................... 41
Section 3.11 Non-recourse .................................... 41
ARTICLE 4
DEFEASANCE AND COVENANT DEFEASANCE .................................. 42
Section 4.1 Option to Effect Defeasance or Covenant
Defeasance .................................................... 42
Section 4.2 Defeasance and Discharge ........................ 42
Section 4.3 Covenant Defeasance ............................. 43
Section 4.4 Conditions to Defeasance or Covenant Defeasance . 43
Section 4.5 Deposited Money and U.S. Government Obligations
to be Held in Trust; Other Miscellaneous Provisions ........... 45
Section 4.6 Reinstatement ................................... 46
ARTICLE 5
REMEDIES ............................................................ 46
Section 5.1 Events of Default ............................... 46
Section 5.2 Acceleration of Maturity; Rescission and
Annulment ..................................................... 49
Section 5.3 Collection of Indebtedness and Suits for
Enforcement by Trustee ........................................ 50
Section 5.4 Trustee May File Proofs of Claim ................ 51
Section 5.5 Trustee May Enforce Claims Without Possession
of the Senior Notes ........................................... 52
Section 5.6 Application of Money Collected .................. 52
Section 5.7 Limitation on Suits ............................. 53
Section 5.8 Unconditional Right of Holders to Receive
Principal, Premium and Interest ............................... 53
Section 5.9 Restoration of Rights and Remedies .............. 54
Section 5.10 Rights and Remedies Cumulative .................. 54
Section 5.11 Delay or Omission Not Waiver .................... 54
Section 5.12 Control by Holders .............................. 54
Section 5.13 Waiver of Past Defaults ......................... 55
Section 5.14 Undertaking for Costs ........................... 55
Section 5.15 Waiver of Stay, Extension or Usury Laws ......... 55
Section 5.16 Unconditional Right of Holders to Institute
Certain Suits ................................................. 56
Section 5.17 Management of Casino-Hotel ...................... 56
ARTICLE 6
THE TRUSTEE ......................................................... 56
-3-
<PAGE>
Section 6.1 Duties of Trustee and Notice of Defaults ........ 56
Section 6.2 Certain Rights of Trustee ....................... 58
Section 6.3 Trustee Not Responsible for Recitals,
Dispositions of Senior Notes or Application of Proceeds
Thereof; etc .................................................. 60
Section 6.4 Trustee and Agents May Hold Senior Notes;
Collections; Etc. ............................................. 60
Section 6.5 Money Held in Trust ............................. 60
Section 6.6 Compensation and Indemnification of Trustee
and Its Prior Claim ........................................... 60
Section 6.7 Conflicting Interests ........................... 61
Section 6.8 Corporate Trustee Required; Eligibility ......... 62
Section 6.9 Resignation and Removal; Appointment of
Successor Trustee ............................................. 62
Section 6.10 Acceptance of Appointment by Successor .......... 64
Section 6.11 Merger, Consolidation or Succession to Business . 64
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND ISSUER .................... 65
Section 7.1 Issuer to Furnish Trustee Names and Addresses
of Holders. ................................................... 65
Section 7.2 Disclosure of Names and Addresses of Holders .... 65
Section 7.3 Reports by Trustee .............................. 66
Section 7.4 Reports by the Issuer and the Partnership ....... 67
ARTICLE 8
CONSOLIDATION, MERGER,CONVEYANCE, TRANSFER OR LEASE ................. 68
Section 8.1 The Issuer or the Partnership May Consolidate,
Merge, etc., Only on Certain Terms ............................ 68
Section 8.2 Successor Substituted ........................... 70
ARTICLE 9
SUPPLEMENTAL INDENTURES ............................................. 71
Section 9.1 Supplemental Indentures and Agreements without
Consent of Holders ............................................ 71
Section 9.2 Supplemental Indentures and Agreements with
Consent of Holders ............................................ 72
Section 9.3 Execution of Supplemental Indentures and
Agreements .................................................... 73
Section 9.4 Effect of Supplemental Indentures ............... 74
Section 9.5 Conformity with Trust Indenture Act ............. 74
Section 9.6 Reference in Senior Notes to Supplemental
Indentures .................................................... 74
Section 9.7 Record Date ..................................... 74
-4-
<PAGE>
ARTICLE 10
COVENANTS ........................................................... 75
Section 10.1 Payment of Principal, Premium and Interest ...... 75
Section 10.2 Maintenance of Office or Agency ................. 75
Section 10.3 Money for Senior Note Payments to be Held
in Trust ...................................................... 75
Section 10.4 Issuer's and Partnership's Existence ............ 77
Section 10.5 Payment of Taxes and Other Claims ............... 77
Section 10.6 Maintenance of Properties ....................... 77
Section 10.7 Limitation on Partnership Indebtedness .......... 78
Section 10.8 Limitation on Liens ............................. 79
Section 10.9 Limitation on Restricted Payments ............... 79
Section 10.10 Limitation on Partnership Leases ................ 82
Section 10.11 Limitation on Preferred Stock of Subsidiaries
and Subsidiary Distributions .................................. 82
Section 10.12 Limitation on Payment Restrictions Affecting
Subsidiaries .................................................. 83
Section 10.13 Purchase of Senior Notes upon Change of Control . 83
Section 10.14 Limitations on Transactions with Affiliates ..... 85
Section 10.15 Restriction on Transfer of Assets ............... 86
Section 10.16 Limitation on Activities and Investments ........ 86
Section 10.17 Restriction on Payment of Services Fee .......... 86
Section 10.18 Provision of Financial Statements ............... 87
Section 10.19 Statement by Officers as to Default ............. 87
Section 10.20 Waiver of Certain Covenants ..................... 88
Section 10.21 Mortgage Notes and PIK Notes .................... 88
ARTICLE 11
REDEMPTION OF SENIOR NOTES .......................................... 88
Section 11.1 Senior Notes Redeemed Pursuant to Casino
Control Act ................................................... 88
Section 11.2 Optional Redemption ............................. 89
Section 11.3 Senior Notes Redeemed Pursuant to a Total Taking
or Casualty ................................................... 89
Section 11.4 Applicability of Article ........................ 89
Section 11.5 Notice to Truste ................................ 89
Section 11.6 Selection by Trustee of Senior Notes to Be
Redeemed ...................................................... 89
Section 11.7 Notice of Redemption ............................ 90
Section 11.8 Deposit of Redemption Price ..................... 91
Section 11.9 Senior Notes Payable on Redemption Date ......... 91
Section 11.10 Senior Notes Redeemed in Part ................... 91
-5-
<PAGE>
ARTICLE 12
TCHI NOTE MORTGAGE DOCUMENTS ........................................ 92
Section 12.1 TCHI Note Mortgage Documents .................... 92
Section 12.2 Recording, Opinion of Counsel, Etc. ............. 93
Section 12.3 Release of Collateral ........................... 93
Section 12.4 Trust Indenture Act Requirements ................ 94
Section 12.5 Disposition of Certain Collateral without
Requesting Release ............................................ 94
Section 12.6 Suits to Protect Cthe Collateral ................ 95
Section 12.7 Determinations Relating to Collateral ........... 95
Section 12.8 Impairment of Security Interest ................. 96
Section 12.9 Release Upon Termination of the Issuer's
Obligations ................................................... 96
Section 12.10 Authorization of Receipt of Funds by the
Trustee Under the TCHI Note Mortgage Documents ................ 97
ARTICLE 13
SATISFACTION AND DISCHARGE .......................................... 97
Section 13.1 Satisfaction and Discharge of Indenture ......... 97
Section 13.2 Application of Trust Money ...................... 98
ARTICLE 14
SENIOR GUARANTEE .................................................... 98
Section 14.1 Partnership Senior Guarantee .................... 98
Section 14.2 Continuing Guarantee; No Right of Set-Off;
Independent Obligation ........................................ 99
Section 14.3 Guarantee Absolute .............................. 100
Section 14.4 Right to Demand Full Performance ................ 102
Section 14.5 Waivers ......................................... 102
Section 14.6 The Partnership Remains Obligated in Event the
Issuer Is No Longer Obligated to Discharge Indenture
Obligations ................................................... 103
Section 14.7 Waiver of Rights. ............................... 103
Section 14.8 Senior Guarantee Is in Addition to Other
Security ...................................................... 103
Section 14.9 Release of Security Interests ................... 103
Section 14.10 No Bar to Further Actions ....................... 104
Section 14.11 Failure to Exercise Rights Shall Not Operate
As a Waiver; No Suspension of Remedies ........................ 104
Section 14.12 Successors and Assigns .......................... 104
Section 14.13 Release of Senior Guarantee ..................... 104
Section 14.14 Execution of Senior Guarantee ................... 105
-i-
<PAGE>
EXHIBIT A Form of Senior Partnership Upstream Note
EXHIBIT B Form of Senior Partnership Upstream Note Mortgage
EXHIBIT C Form of Senior Upstream Assignment Agreement
EXHIBIT D Form of TCHI Guarantee Mortgage
SCHEDULE I Permitted Indebtedness
SCHEDULE II Permitted Investments
-ii-
<PAGE>
Reconciliation and tie between Trust
Indenture Act of 1939
and Indenture, dated as of April 17, 1998
Trust Indenture Indenture
Act Section Section
- --------------- ---------
ss.310(a)(1) ............................ 6.8
(a)(2) ............................ 6.8
(b) ............................ 6.7, 6.9
ss.312(a) ............................ 7.1
(c) ............................ 7.2
ss.314(a) ............................ 7.4
(a)(4) ............................ 10.19
(b) ............................ 12.2
(c)(1) ............................ 1.3
(c)(2) ............................ 1.3
(e) ............................ 1.3
ss.315(b) ............................ 6.1
ss.316(a)(last
sentence)
(a)(1)(A) ............................ 1.1 ("Outstanding")
(a)(1)(A) ............................ 5.2, 5.12
(a)(1)(B) ............................ 5.13
(b) ............................ 5.8
(c) ............................ 9.7
ss.317(a)(1) ............................ 5.3
(a)(2) ............................ 5.4
ss.318(a) ............................ 1.8
- ----------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
-iii-
<PAGE>
INDENTURE, dated as of April 17, 1998, among TRUMP'S CASTLE HOTEL &
CASINO, INC., a New Jersey corporation (the "Issuer"), as issuer, U.S. BANK
NATIONAL ASSOCIATION, a national banking association ("Trustee"), as trustee,
and TRUMP'S CASTLE ASSOCIATES, L.P., a New Jersey limited partnership (the
"Partnership" or "Guarantor"), as guarantor.
RECITALS OF THE ISSUER AND THE PARTNERSHIP
The Issuer has duly authorized the creation of an issue of up to
$5,000,000 aggregate principal amount of its (a) 10 1/4% Series A Senior Secured
Notes due 2003 (the "Series A Notes") and (b) its 10 1/4% Series B Senior
Secured Notes due 2003 (the "Series B Notes" and collectively with the Series A
Notes, the "Senior Notes") of substantially the tenor and amount hereinafter set
forth, and to provide therefor the Issuer has duly authorized the execution and
delivery of this Indenture.
The Partnership has duly authorized the issuance of a guarantee of the
Senior Notes (the "Senior Guarantee"), of substantially the tenor hereinafter
set forth, and to provide therefor the Partnership has duly authorized the
execution and delivery of this Indenture and the Senior Guarantee.
This Indenture is subject to, and shall be governed by, the provisions of
the Trust Indenture Act of 1939, as amended, that are required to be part of and
to govern indentures qualified under such Trust Indenture Act.
All acts and things necessary have been done to make (i) the Senior Notes,
when executed by the Issuer and authenticated and delivered hereunder and duly
issued by the Issuer, the valid obligations of the Issuer, (ii) the Senior
Guarantee, when executed by the Partnership and delivered hereunder, the valid
obligation of the Partnership and (iii) this Indenture a valid agreement of the
Issuer and the Partnership in accordance with its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Senior
Notes by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Senior Notes, as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
<PAGE>
Section 1.1 Definitions.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them
in this Article, and include the plural as well as the singular;
(b) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with GAAP;
(d) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;
(e) "or" is not exclusive; and
(f) all references to $ or dollars shall refer to the lawful currency of
the United States of America.
Certain Definitions
"Acquired Indebtedness" means Indebtedness of a Person (a) existing at the
time such Person becomes a Subsidiary or (b) assumed in connection with the
acquisition of assets from such Person, in each case, other than Indebtedness
incurred in connection with, or in contemplation of, such Person becoming a
Subsidiary or such acquisition. Acquired Indebtedness shall be deemed to be
incurred on the date of the related acquisition of assets from any Person or the
date the acquired Person becomes a Subsidiary.
"Adjusted Consolidated Interest Expense" means, without duplication, for
any period, the sum of (a) the interest expense of the Partnership and its
Consolidated Subsidiaries for such period, on a Consolidated basis, including,
without limitation, (i) amortization of debt discount, (ii) the net cost under
interest rate contracts (including amortization of discounts), (iii) the
interest portion of any deferred payment obligation and (iv) accrued interest
plus (b) the interest component of the Capital Lease Obligations paid, accrued
and/or scheduled to be paid, or accrued by the Partnership and its Consolidated
Subsidiaries during such period, in each case as determined in accordance with
GAAP consistently applied.
"Adjusted Consolidated Net Income (Loss)" means, for any period, the
Consolidated net income (or loss) of the Partnership and its Consolidated
Subsidiaries for such period as determined in accordance with GAAP consistently
applied, adjusted, to the extent included in
-2-
<PAGE>
calculating such net income (loss), by excluding (a) all extraordinary gains or
losses (less all fees and expenses relating thereto), (b) the portion of net
income (or loss) of the Partnership and its Consolidated Subsidiaries allocable
to minority interests in unconsolidated Persons to the extent that cash
dividends or distributions have not actually been received by the Partnership or
one of its Consolidated Subsidiaries, (c) net income (or loss) of any Person
combined with the Partnership or any of the Subsidiaries on a "pooling of
interests" basis attributable to any period prior to the date of combination,
(d) any gain or loss, net of taxes, realized upon the termination of any
employee pension benefit plan, (e) net gains or losses (less all fees and
expenses relating thereto) in respect of dispositions of assets other than in
the ordinary course of business, or (f) the net income of any Subsidiary to the
extent that the declaration of dividends or similar distributions by that
Subsidiary of that income is not at the time permitted, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary or its shareholders.
"Affiliate" means, with respect to any specified Person, (a) any other
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person or (b) any other Person that
owns, directly or indirectly, 5% or more of such Person's Capital Stock or
Equity Interest or any officer or director of any such Person or other Person or
with respect to any natural Person, any person having a relationship with such
Person by blood, marriage or adoption not more remote than first cousin. 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 ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Appraised Value" shall have the meaning set forth in Section 1 of the
Senior Partnership Upstream Note Mortgage.
"Assignment of Leases and Rents and Assignment of Operating Assets" means
collectively (i) the Assignment of Leases and Rents and Assignment of Operating
Assets dated as of the date hereof by the Partnership to the Issuer and (ii) the
Assignment of Leases and Rents and Assignment of Operating Assets dated as of
the date hereof by the Partnership to the Trustee.
"Average Life to Stated Maturity" means, as of the date of determination
with respect to any Indebtedness, the quotient obtained by dividing (a) the sum
of the products of (i) the number of years from the date of determination to the
date or dates of each successive scheduled principal payment of such
Indebtedness multiplied by (ii) the amount of each such principal payment by (b)
the sum of all such principal payments.
"Bankruptcy Law" means Title 11, United States Code, as amended, or any
similar United States federal or state law relating to bankruptcy, insolvency,
receivership, winding-up,
-3-
<PAGE>
liquidation, reorganization or relief of debtors or any amendment to, succession
to or change in any such law.
"Board of Directors" means, with respect to the Issuer, the board of
directors of the Issuer or, with respect to the Partnership, the board of
partner representatives, or any duly authorized committee of any such board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Issuer or the Partnership, as the case may be,
to have been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in The City of New York are
authorized or obligated by law or executive order to close.
"Cage Cash" means the sum of $5,000,000 retained for daily operations of
the Casino.
"Capital Lease Obligation" of any Person means any obligation of such
Person and its subsidiaries on a Consolidated basis under any capital lease of
real or personal property which, in accordance with GAAP, has been recorded as a
capitalized lease obligation.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of such Person's
capital stock.
"Casino - Hotel" means the casino and hotel complex currently known as the
"Trump Marina Hotel Casino" in Atlantic City, New Jersey and ancillary
structures, marina and other facilities and all furniture, fixtures and
equipment at any time contained therein, in each case owned by or leased to the
Partnership and covered by the lien of the Senior Partnership Upstream Note
Mortgage.
"Casualty" means any act or occurrence of any kind or nature which results
in damage, loss or destruction to any buildings or improvements on the Premises
and/or Tangible Personal Property (as such terms are defined in Section 1.1 of
the Senior Partnership Upstream Note Mortgage).
"CCC" means the New Jersey Casino Control Commission or any successor
entity thereto.
"Certificate of Appraised Value" shall have the meaning set forth in
Section 1.1 of the Senior Partnership Upstream Note Mortgage.
-4-
<PAGE>
"Change of Control" means an event as a result of which (a) the Permitted
Holder does not have the right or ability by voting power, contract or otherwise
to elect or designate for election a majority of the Board of Directors of the
Issuer and the Board of Partner Representatives of the Partnership or to control
the management of the Partnership; or (b) the Partnership is liquidated or
dissolved or adopts a plan of liquidation or dissolution, provided, however, a
Change of Control shall not be deemed to occur as a result of one or more Public
Offerings so long as (i) the Permitted Holder continues to own beneficially 20%
or more of the voting equity securities of the entity which conducted the Public
Offering and (ii) no other holder beneficially owns a greater percentage of
voting securities of such entity than the Permitted Holder.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means, collectively, all of the property and assets that are
from time to time subject to the Lien of the Senior Partnership Upstream Note
Mortgage.
"Consolidated Fixed Charge Coverage Ratio" means for any period the ratio
of (a) the sum of Adjusted Consolidated Net Income, Adjusted Consolidated
Interest Expense and Consolidated Income Tax Expense, plus, without duplication,
all depreciation, amortization and all other non-cash charges (excluding any
such non-cash charges constituting an extraordinary item of loss or any non-cash
charge which requires an accrual of or a reserve for cash charges for any future
period) in each case, for such period, of the Partnership and its Consolidated
Subsidiaries on a Consolidated basis, all determined in accordance with GAAP
consistently applied to (b) Adjusted Consolidated Interest Expense for such
period.
"Consolidated Income Tax Expense" means for any period the provision for
federal, state, local and foreign income taxes of the Partnership and its
Consolidated Subsidiaries for such period as determined in accordance with GAAP
consistently applied.
"Consolidated Net Worth" of any Person means the Consolidated
stockholders' equity (excluding Redeemable Capital Stock or Redeemable Equity
Interests) of such Person and its Consolidated subsidiaries, as determined in
accordance with GAAP consistently applied.
"Consolidation" means, with respect to any Person, the consolidation of
the accounts of such Person and each of its subsidiaries if and to the extent
the accounts of such Person and each of its subsidiaries would normally be
consolidated with those of such Person, all in accordance with GAAP consistently
applied. The term "Consolidated" shall have a similar meaning.
"Corporate Trust Office" means the office of the Trustee, or its agent, at
which at any particular time its corporate trust business shall be administered,
which office at the date of execution of this Indenture is located at 180 East
Fifth Street, St. Paul, Minnesota 55101.
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"CRDA" means the Casino Reinvestment Development Authority or any
successor entity thereto.
"Default" means any event which is, or after notice or passage of time or
both would be, an Event of Default.
"EBITDA" means, for the relevant accounting period, an amount equal to the
sum of (i) the net income (or loss) of the Partnership for such period
determined in accordance with generally accepted accounting principles,
consistently applied, excluding any extraordinary, unusual or non-recurring
gains (including without limitation those gains arising from dispositions of
assets or from the purchase, redemption or discharge of any indebtedness), and
excluding any extraordinary, unusual or non-recurring losses arising from (A)
transactions or events approved by not less than two of the Noteholder
Representatives (so long as such approval includes an explicit finding that any
such losses arising from such transaction or event are to be so excluded
pursuant to this clause (A)) or (B) the purchase, redemption or discharge of any
indebtedness in respect of the Mortgage Notes or PIK Notes, plus (ii) all
amounts deducted in computing such net income (or loss) in respect of interest
(including the imputed interest portions of rentals under Capitalized Leases),
depreciation, amortization and taxes based upon or measured by income, plus
(iii) other non-cash charges arising from market value adjustments and
adjustments pertaining to contributions of deposits in each case in respect of
CRDA Bonds.
"Equity Interest" of any Person means any shares, interests,
participations or other equivalents (however designated) of such Person in
equity.
"Event of Default" has the meaning specified in Article Five.
"Excess Available Cash" shall be calculated semi-annually on June 30 and
December 31 and means the sum of the Partnership's cash and cash equivalents as
shown on its balance sheet at such date less the sum of (1) the Partnership's
Cage Cash, (2) the Partnership's working capital reserve of $10 million less the
amount, if any, available to the Partnership under the Working Capital Facility,
(3) the aggregate amount required to meet the cash interest payments due on all
Permitted Indebtedness on the next respective interest payment dates, (4)
distributions to be made during the succeeding six month period in respect of
taxes as contemplated by clause (c) of Section 10.9(b)(ix) hereof, and (5) the
cash amounts required to meet the Partnership's Capital Expenditures (as defined
in the Partnership Agreement), CRDA bond payments and other fixed charges
projected during the succeeding six month period.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"F,F&E Financing Agreement" means an agreement which creates a Lien upon
any after-acquired Tangible Personal Property (as defined in the Senior
Partnership Upstream Note
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Mortgage) and/or other items constituting Operating Assets (as defined in the
Senior Partnership Upstream Note Mortgage), which are financed, purchased or
leased by the Partnership.
"Fair Market Value" means, with respect to any asset or property, the sale
value that would be obtained in an arm's-length transaction between an informed
and willing seller under no compulsion to sell and an informed and willing buyer
under no compulsion to buy and, with respect to any Senior Notes redeemed under
Section 11.1, means (a) the last sales price regular way on the last trading day
prior to the date of determination of such value on the largest national
securities exchange (or, if said security is not listed on a national securities
exchange, on the National Market System of the National Association of
Securities Dealers, Inc. Automated Quotation System ("NASDAQ")) on which such
Senior Notes shall have traded on such trading day, or (b) if no such sales of
such Senior Notes occurred on such trading day, the mean between the "bid" and
"asked" prices on such national securities exchange or as quoted on the National
Market System of NASDAQ, as the case may be, on such last trading day, or (c) if
the Senior Notes are not listed or quoted on any national securities exchange or
the National Market System of NASDAQ, the average of the closing bid and asked
prices on such day in the over-the-counter market as reported by NASDAQ or, if
bid and asked prices for the Senior Notes have not been reported through NASDAQ,
the average of the bid and asked prices on such day as furnished by any New York
Stock Exchange member firm regularly making a market in the Senior Notes,
selected for such purpose by the Issuer, or (d) if none of clauses (a) through
(c) are applicable, the fair market value of such Senior Notes as of the date of
determination as determined in such manner as shall be satisfactory to the
Issuer, which shall be entitled to rely for such purpose on the advice of any
firm of investment bankers or securities dealers having familiarity with the
Senior Notes.
"Funding" means Trump's Castle Funding, Inc., a New Jersey corporation.
"Funding Notes" means the Funding's 10 1/4% Senior Secured Notes due 2003
issued in an aggregate original principal amount of $62,000,000.
"Funding Note Indenture" means the Indenture dated the date hereof by and
between Funding, as issuer, the Partnership, as guarantor, and U.S. Bank
National Association, as trustee, with respect to the Funding Notes.
"Funding Note Mortgage Documents" means the "Senior Note Mortgage
Documents", as such term is defined in the Funding Note Indenture.
"Gaming Authority" means the CCC, the NJDGE or any other governmental
agency which regulates gaming in a jurisdiction in which the Partnership
conducts gaming activities.
"Generally Accepted Accounting Principles" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied, which
are in effect on the date of this Indenture.
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"Guaranteed Debt" of any Person means, without duplication, all
Indebtedness of any other Person referred to in the definition of Indebtedness
contained in this section guaranteed directly or indirectly in any manner by
such Person, or in effect guaranteed directly or indirectly by such Person
through an agreement (a) to pay or purchase such Indebtedness or to advance or
supply funds for the payment or purchase of such Indebtedness, (b) to purchase,
sell or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such
Indebtedness or to assure the holder of such Indebtedness against loss, (c) to
supply funds to, or in any other manner invest in, the debtor (including any
agreement to pay for property or services without requiring that such property
be received or such services be rendered), (d) to maintain working capital or
equity capital of the debtor, or otherwise to maintain the net worth, solvency
or other financial condition of the debtor or (e) otherwise to assure a creditor
against loss; provided that the term "guarantee" shall not include endorsements
for collection or deposit, in either case in the ordinary course of business;
provided further, that the obligations of the Partnership pursuant to the
Services Agreement as in effect on the date of this Indenture shall not be
deemed to be Guaranteed Debt of the Partnership.
"Holder" means a Person in whose name a Senior Note is registered in the
Senior Note Register.
"Indebtedness" means, with respect to any Person, without duplication, (a)
all indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services, excluding any trade payables and other accrued
current liabilities arising in the ordinary course of business, but including,
without limitation, all obligations, contingent or otherwise, of such Person in
connection with any letters of credit issued under letter of credit facilities,
acceptance facilities or other similar facilities and in connection with any
agreement to purchase, redeem, exchange, convert or otherwise acquire for value
any Capital Stock or Equity Interest of such Person, or any warrants, rights or
options to acquire such Capital Stock or Equity Interest, now or hereafter
outstanding, (b) all obligations of such Person evidenced by bonds, notes,
debentures or other similar instruments, (c) every obligation of such Person
issued or contracted for as payment in consideration of the purchase by such
Person or an Affiliate of such Person of the Capital Stock or Equity Interest or
substantially all of the assets of another Person or in consideration for the
merger or consolidation with respect to which such Person or an Affiliate of
such Person was a party, (d) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even if the rights and remedies of the seller or lender
under such agreement in the event of default are limited to repossession or sale
of such property), but excluding trade payables and other accrued current
liabilities arising in the ordinary course of business, (e) all obligations
under interest rate contracts of such Person, (f) all Capital Lease Obligations
of such Person, (g) all Indebtedness referred to in clauses (a) through (f)
above of other Persons and all dividends of other Persons, the payment of which
are secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien upon or in property
(including, without limitation, accounts and contract rights) owned by such
Person,
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even though such Person has not assumed or become liable for the payment of such
Indebtedness, (h) all Guaranteed Debt of such Person, (i) all Redeemable Capital
Stock or Redeemable Equity Interests valued at the greater of its voluntary or
involuntary maximum fixed repurchase price plus accrued and unpaid dividends,
and (j) any amendment, supplement, modification, deferral, renewal, extension or
refunding of any liability of the types referred to in clauses (a) through (i)
above. For purposes hereof, the "maximum fixed repurchase price" of any
Redeemable Capital Stock or Redeemable Equity Interest which does not have a
fixed repurchase price shall be calculated in accordance with the terms of such
Redeemable Capital Stock or Redeemable Equity Interest as if such Redeemable
Capital Stock or Redeemable Equity Interest were purchased on any date on which
Indebtedness shall be required to be determined pursuant to this Indenture, and
if such price is based upon, or measured by, the Fair Market Value of such
Redeemable Capital Stock or Redeemable Equity Interest, such Fair Market Value
to be determined in good faith by the board of directors of the issuer (or
managing general partner of the issuer) of such Redeemable Capital Stock or
Redeemable Equity Interest.
"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Indenture Obligations" means the obligations of the Issuer, the
Partnership and any other obligor under this Indenture or under the Senior
Notes, to pay principal of, premium, if any, and interest when due and payable,
and all other amounts due or to become due under or in connection with this
Indenture, the Senior Notes and the performance of all other obligations to the
Trustee and the Holders under this Indenture, the Senior Notes and the Senior
Partnership Upstream Note Mortgage, according to the terms thereof.
"Intercreditor Agreement" means the Intercreditor Agreement of even date
herewith among the Issuer, Funding, the Partnership, the Trustee, the trustee
under the Funding Note Indenture, the trustee under the Mortgage Note Indenture,
and the trustee under the PIK Note Indenture.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Senior Notes.
"Investments" means, with respect to any Person, directly or indirectly,
any advance, loan or other extension of credit or capital contribution to (by
means of any transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any purchase or other
acquisition by such Person of any Capital Stock, Equity Interest, bonds, notes,
debentures or other securities or assets issued or owned by, any other Person.
"Issuer" means Trump's Castle Hotel & Casino, Inc., a corporation
incorporated under the laws of the State of New Jersey or any other obligor on
the Senior Notes (other than the
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Partnership), including any successor Person to Trump's Castle Hotel & Casino,
Inc. in accordance with Article Eight hereof.
"Issuer Request" or "Issuer Order" means a written request or order signed
in the name of the Issuer by any one of its Chairman of the Board, its Vice
Chairman, its President or a Vice President, and by any one of its Treasurer, an
Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to
the Trustee.
"Legal Requirements" has the meaning set forth in Section 1.1 of the
Senior Partnership Upstream Note Mortgage.
"Lien" means any mortgage, charge, pledge, lien (statutory or otherwise),
privilege, security interest, hypothecation or other encumbrance upon or with
respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired.
"Marina Lease" means the lease agreement made September 1, 1990 between
the State of New Jersey, as Landlord, and the Partnership, as tenant, as
amended, respecting property known as the Senator Frank S. Farley State Marina,
Atlantic City, New Jersey, being designated as a portion of Block B-4, Lot 11 on
the tax map of the City of Atlantic City, Atlantic County, New Jersey, together
with all amendments, restatements, extensions and renewals thereof.
"Maturity" when used with respect to any Senior Note means the date on
which the principal of such Senior Note becomes due and payable as therein
provided or as provided in this Indenture, whether at Stated Maturity, Change of
Control Purchase Date or the Redemption Date and whether by declaration of
acceleration, Change of Control Offer, call for redemption or otherwise.
"Mortgage Debt" means any Indebtedness secured by Liens (other than
involuntary Liens) on any portion of the Collateral.
"Mortgage Documents" shall have the meaning set forth in the Mortgage Note
Indenture.
"Mortgage Notes" means the 11-3/4% Mortgage Notes due 2003 issued by
Funding.
"Mortgage Note Indenture" means that certain indenture among Funding, as
issuer, the Partnership, as guarantor, and First Bank National Association (now
known as U.S. Bank National Association), as trustee, dated as of December 28,
1993, relating to the Issuer's 11 3/4% Mortgage Notes due 2003 as it may from
time to time be supplemented or amended by one or more indentures supplemental
thereto.
"NASDAQ" is defined under the definition of "Fair Market Value."
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"Net Cash Proceeds" of an issuance means the cash proceeds of such
issuance, net of attorney's fees, accountant's fees, brokerage, consultant,
underwriting and other fees and expenses actually incurred in connection with
such issuance, sale, conversion or exchange and net of taxes paid or payable as
a result thereof.
"NJDGE" means the New Jersey Division of Gaming Enforcement or any
successor entity thereto.
"Noteholder Representatives" shall have the meaning set forth in the
Partnership Agreement.
"Note Mortgage" shall have the meaning set forth in the Mortgage Note
Indenture.
"Officers' Certificate" means a certificate signed by a general partner or
the President or a Vice President, and by the Treasurer, Assistant Treasurer,
Secretary or an Assistant Secretary, of the Issuer or the Partnership and
delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Issuer or the Trustee.
"Outstanding" when used with respect to Senior Notes means, as of the date
of determination, all Senior Notes theretofore authenticated and delivered under
this Indenture, except:
(a) Senior Notes theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(b) Senior Notes, or portions thereof, for whose payment or redemption
money in the necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Issuer) in trust or set aside and segregated in
trust by the Issuer (if the Issuer shall act as its own Paying Agent) for the
Holders of such Senior Notes; provided that if such Senior Notes are to be
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made; and
Senior Notes, except to the extent provided in Sections 4.2 and 4.3, with
respect to which the Issuer has effected defeasance or covenant defeasance as
provided in Article Four; and
(c) Senior Notes in exchange for or in lieu of which other Senior Notes
have been authenticated and delivered pursuant to this Indenture, other than any
such Senior Notes in respect of which there shall have been presented to the
Trustee proof satisfactory to it that such Senior Notes are held by a bona fide
purchaser in whose hands the Senior Notes are valid obligations of the Issuer;
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provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Senior Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Senior Notes
owned by the Issuer, the Partnership, or any other obligor upon the Senior Notes
or any Affiliate of the Issuer, the Partnership, any guarantor or such other
obligor shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Senior Notes which the Trustee knows to be so owned shall be so disregarded.
Senior Notes so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgor's right so to act with respect to such Senior Notes and that the pledgee
is not the Issuer, the Partnership or any other obligor upon the Senior Notes or
any Affiliate of the Issuer, the Partnership or such other obligor.
"Outstanding Amount" of any Indebtedness at any time means the principal
amount outstanding of such Indebtedness at such time, unless such Indebtedness
was issued at a discount, in which case the "Outstanding Amount" of such
Indebtedness means the original issue price of such Indebtedness plus the
accretion to such time of the original issue discount, determined in accordance
with Generally Accepted Accounting Principles.
"Pari Passu Indebtedness" means any Indebtedness of the Partnership that
is Pari Passu in right of payment to the Senior Guarantee.
"Partnership" means Trump's Castle Associates, L.P., a New Jersey limited
partnership, and any successor Person to Trump's Castle Associates, L.P. in
accordance with Article Eight hereof.
"Partnership Agreement" means the Partnership's Third Amended and Restated
Partnership Agreement dated as of October 7, 1996 as in effect on the date of
this Indenture.
"Partnership Note" means the Partnership Note dated as of December 28,
1993 in the principal amount of $242,141,304 made by the Partnership in favor of
Funding, evidencing the proceeds of the Mortgage Notes.
"Paying Agent" means any Person authorized by the Issuer to pay the
principal, premium, if any, or interest on any Senior Notes on behalf of the
Issuer.
"Permit" means any license, franchise, authorization, statement of
compliance, certificate of operation, certificate of occupancy and permit
required for the lawful ownership, occupancy, operation and use of all or a
material portion of the Collateral whether held by the Partnership or any other
Person (which may be temporary or permanent) (including, without limitation,
those required for the use of the Casino Hotel as a licensed casino facility),
in accordance with all applicable Legal Requirements.
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"Permitted Holder" means Donald J. Trump and any corporation or other
entity that is controlled by Donald J. Trump.
"Permitted Indebtedness" means the following:
(a) Indebtedness of the Partnership and the Issuer pursuant to this
Indenture and the TCHI Note Mortgage Documents;
(b) Indebtedness of the Partnership pursuant to another portion of the
Working Capital Facility;
(c) Indebtedness of the Partnership and Funding pursuant to the Funding
Note Indenture and the Senior Note Mortgage Documents;
(d) Indebtedness of the Partnership and Funding pursuant to the Mortgage
Note Indenture and the Mortgage Documents;
(e) Indebtedness of the Partnership and Funding pursuant to the PIK Note
Indenture and the Pledge Agreement (as defined in the PIK Note Indenture);
(f) Indebtedness of the Partnership outstanding on the date of this
Indenture and listed on Schedule I hereto;
(g) Indebtedness of the Partnership or any Wholly-owned Subsidiary to any
one or the other of them;
(h) Indebtedness of the Partnership or any Subsidiary represented by F,F&E
Financing Agreements; provided, however, that the aggregate principal amount of
Indebtedness permitted by this clause (h) shall not exceed at any one time
outstanding (i) $2,000,000 or (ii) $25,000,000 following the time at which the
Partnership shall have achieved EBITDA for any period of four consecutive fiscal
quarters in an amount not less than $45,000,000.
(i) Indebtedness in respect of Capital Lease Obligations or secured
purchase money security interests of the Partnership or any Subsidiary, in
either case not created by an F, F&E Financing Agreement; provided, however,
that the aggregate principal amount of all such Capital Lease Obligations
permitted by this clause (i) shall not exceed at any one time outstanding (i)
$10,000,000 or (ii) $15,000,000 following the time at which the Partnership
shall have achieved EBITDA for any period of four consecutive fiscal quarters in
an amount not less than $60,000,000 and provided, further, that the aggregate
principal amount of all such Indebtedness secured by purchase money security
interests shall not exceed at any one time outstanding $10,000,000; and
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(j) any renewals, extensions, substitutions, refundings, refinancings or
replacements of any Indebtedness described in clauses (a) through (j) of this
definition of "Permitted Indebtedness," including any successive renewals,
extensions, substitutions, refundings, refinancings or replacements so long as
the aggregate principal amount of Indebtedness represented thereby does not
exceed the principal amount of such Indebtedness being renewed, extended,
substituted, refunded, refinanced or replaced (or, if such Indebtedness provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration thereof, such lesser amount as of the date of
determination) plus accrued interest thereon, plus, in the case of refinancings,
the amount of any premium or other payment required to be paid under the terms
of the instrument governing such Indebtedness or the amount of any premium
reasonably determined by the Partnership as necessary to accomplish such
refinancing by means of a tender offer or privately negotiated purchase and, in
each case, actually paid, plus the amount of expenses of the Partnership
incurred in connection with such refinancing and such renewal, extension,
substitution, refinancing or replacement does not reduce the Average Life to
Stated Maturity or the final Stated Maturity of such Indebtedness.
"Permitted Investment" means (a) Investments in any of the Senior Notes,
Funding Notes, PIK Notes or Mortgage Notes; (b) Temporary Cash Investments; (c)
intercompany notes to the extent permitted under the definition of "Permitted
Indebtedness"; and (d) any Investments in existence on the date of this
Indenture and listed on Schedule II to this Indenture.
"Permitted Leases" means the following:
(i) the Marina Lease;
(ii) any Capital Lease Obligation permitted by clause (i) of the
definition of "Permitted Indebtedness"; and
(iii) Leases other than Capital Lease Obligations and the Marina Lease;
provided, however, that the aggregate fixed rental payments paid or accrued for
any period of four consecutive fiscal quarters commencing after the date hereof
under all such leases (including payments required to be made by the Lessee in
respect of taxes and insurance, whether or not denominated as rent), shall not
exceed for such period (a) $2,000,000 or (b) $7,500,000 following the times at
which the Partnership shall have achieved EBITDA for any period of four
consecutive fiscal quarters in an amount not less than $45,000,000.
"Permitted Liens" means:
(a) any Lien existing as of the date of this Indenture under the TCHI Note
Mortgage Documents, the Senior Note Mortgage Documents (including without
limitation, "Permitted Encumbrances" as defined in the Senior Note Mortgage),
the Senior Guarantee Mortgage, the Mortgage Documents (including without
limitation, "Permitted Encumbrances" and "Restricted Encumbrances", both as
defined in the Note Mortgage), the Pledge Agreement (as defined in the
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PIK Note Indenture), "Permitted Encumbrances" hereafter arising and permitted
under the TCHI Note Mortgage Documents, and any Lien hereafter arising under the
Working Capital Facility;
(b) Capital Lease Obligations and purchase money liens included in
Permitted Indebtedness;
(c) the Lien in favor of the Trustee pursuant to Section 6.6 of this
Indenture, the Lien in favor of the trustee pursuant to Section 6.6 of the
Mortgage Note Indenture, the Lien in favor of the trustee pursuant to Section
6.6 of the Funding Note Indenture, and the Lien in favor of the trustee pursuant
to Section 6.6 of the PIK Note Indenture;
(d) any Lien arising by reason of (i) any judgment, decree or order of any
court, so long as such Lien is adequately bonded and any appropriate legal
proceedings which may have been duly initiated for the review of such judgment,
decree or order shall not have been finally terminated or the period within
which such proceedings may be initiated shall not have expired; (ii) security
for payment of workmen's compensation or other insurance; (iii) good faith
deposits in connection with tenders, leases, contracts (other than contracts for
the payment of money); and (iv) deposits to secure public or statutory
obligations, or in lieu of surety or appeal bonds; and
(e) any Lien arising by reason of any renewal, extension, substitution,
refunding, refinancing or replacement of any Indebtedness permitted by clause
(j) of the definition of Permitted Indebtedness.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PIK Note Indenture" means that certain indenture among Funding, as
issuer, the Partnership, as guarantor, and First Bank National Association (now
known as U.S. Bank National Association), as trustee, dated as of December 28,
1993, relating to the Issuer's PIK Notes as it may from time to time be
supplemented or amended by one or more indentures supplemental thereto.
"PIK Notes" means the Subordinated Pay-in-Kind Notes due 2005 issued by
Funding in an initial aggregate principal amount of $52,066,000 plus the
aggregate principal amount of PIK Notes issued as payment of interest thereon.
"Predecessor Senior Note" of any particular Senior Note means every
previous Senior Note evidencing all or a portion of the same debt as that
evidenced by such particular Senior Note; and, for the purposes of this
definition, any Senior Note authenticated and delivered under Section 3.6 in
exchange for a mutilated Senior Note or in lieu of a lost, destroyed or stolen
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Senior Note shall be deemed to evidence the same debt as the mutilated, lost,
destroyed or stolen Senior Note.
"Preferred Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's preferred or preference stock whether now outstanding, or issued after
the date of this Indenture, and including, without limitation, all classes and
series of preferred or preference stock.
"Public Offering" shall mean a registered public offering of a direct or
indirect equity interest in Funding.
"Qualified Capital Stock" of any Person means any and all Capital Stock of
such Person other than Redeemable Capital Stock.
"Qualified Equity Interest" of any Person means any Equity Interests of
such Person other than Redeemable Equity Interests.
"Redeemable Capital Stock" means any Capital Stock that, either by its
terms, by the terms of any security into which it is convertible or exchangeable
or otherwise, is or upon the happening of an event (other than the
disqualification of the holder thereof by the CCC) or passage of time would be,
required to be redeemed prior to any Stated Maturity of the principal of the
Senior Notes or is redeemable at the option of the holder thereof at any time
prior to any such Stated Maturity, or is convertible into or exchangeable for
debt securities at any time prior to any such Stated Maturity at the option of
the holder thereof.
"Redeemable Equity Interest" means any Equity Interest that, either by its
terms, by the terms of any security into which it is convertible or exchangeable
or otherwise, is or upon the happening of an event (other than the
disqualification of the holder thereof by the CCC) or passage of time would be,
required to be redeemed prior to any Stated Maturity of the principal of the
Senior Notes or is redeemable at the option of the holder thereof at any time
prior to any such Stated Maturity, or is convertible into or exchangeable for
debt securities at any time prior to any such Stated Maturity at the option of
the holder thereof.
"Redemption Date" when used with respect to any Senior Note to be redeemed
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price" when used with respect to any Senior Note to be
redeemed means the price at which it is to be redeemed pursuant to this
Indenture.
"Registrable Series A Notes" means the Series A Notes upon original
issuance thereof, and at all times subsequent thereto, until, in the case of any
such Series A Note, (A) a Registration Statement with respect to such Series A
Note has been declared effective under the Securities Act and such Series A Note
has been disposed of in accordance with such Registration
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Statement; (B) such Series A Note is distributed to the public pursuant to Rule
144 (or any successor provisions) promulgated under the Securities Act; (C) such
Series A Note has been otherwise transferred and new certificates for them not
bearing a legend restricting further transfer shall have been delivered by the
Issuer; or (D) such Series A Note ceases to be outstanding.
"Registration Rights Agreement" means the registration rights agreement of
even date herewith between the Issuer, the Partnership, Funding, certain
original purchasers of the Series A Notes and certain original purchasers of
Funding Notes.
"Regular Record Date" for the interest payable on any Interest Payment
Date means April 15 or October 15 (whether or not a Business Day) next preceding
such Interest Payment Date.
"Responsible Officer" when used with respect to the Trustee means any
officer assigned to the Corporate Trust Office or any agent of the Trustee
appointed hereunder, including any vice president, assistant vice president,
assistant secretary, or any other officer or assistant officer of the Trustee or
the agent of the Trustee appointed hereunder to whom any corporate trust matter
is referred because of his or her knowledge of and familiarity with the
particular subject.
"Restoration" shall have the meaning set forth in Section 1.1 of the
Senior Partnership Upstream Note Mortgage.
"SEC" means the Securities and Exchange Commission, as from time to time
constituted, created under the Exchange Act, or if at any time after the
execution of this Indenture such SEC is not existing and performing the duties
now assigned to it under the Trust Indenture Act, then the body performing such
duties at such time.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Guarantee", means the guarantee by the Partnership of the Issuer's
obligations under this Indenture pursuant to the guarantee included herein.
"Senior Note Register" and "Senior Note Registrar" have the respective
meanings specified in Section 3.5.
"Senior Notes", means the Issuer's 10 1/4% Senior Secured Notes due 2003
issued pursuant to this Indenture in the aggregate original principal amount of
$5,000,000.
"Senior Partnership Note" means the Note dated as of the date hereof in
the principal amount of $62,000,000 made by the Partnership in favor of Funding,
evidencing the proceeds of the Funding Notes, and pledged to the trustee under
the Funding Note Indenture.
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"Senior Partnership Upstream Note" means the Note, dated the date hereof
in the principal amount of $5,000,000 made by the Partnership in favor of the
Issuer, evidencing the proceeds of the Senior Notes, and pledged to the Trustee.
"Senior Partnership Upstream Note Mortgage", means the Indenture of
Mortgage and Security Agreement, dated as of the date hereof, between the
Issuer, as mortgagee, and the Partnership, as mortgagor, a copy of which is
attached hereto as Exhibit B, securing the Senior Partnership Upstream Note.
"Senior Upstream Assignment Agreement" means the Senior Assignment
Agreement between the Issuer and the Trustee dated as of the date hereof, the
form of which is attached hereto as Exhibit C, providing for the assignment of
the Senior Upstream Partnership Note and the Senior Partnership Upstream Note
Mortgage to the Trustee by the Issuer and acknowledgment thereof by the
Guarantor.
"Series A Notes" and "Series B Notes", have the meanings specified in the
first recital of this Indenture.
"Services Agreement" means that certain services agreement, dated as of
December 28, 1993 between the Partnership and Trump Casinos II, Inc. relating to
the provision of advertising and other consulting services to the Partnership.
"Services Fee" means, for any period, the amount of the fee payable by the
Partnership under the Services Agreement for such period.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.7.
"Stated Maturity" when used with respect to any Indebtedness or any
installment of interest thereon means the dates specified in such Indebtedness
as the fixed date on which the principal of such Indebtedness or such
installment of interest is due and payable.
"Subordinated Indebtedness" means Indebtedness of the Partnership
subordinated in right of payment to the Senior Guarantee.
"Subsidiary" means any Person a majority of the equity ownership or the
Voting Stock of which is at the time owned, directly or indirectly, by the
Partnership or by one or more other Subsidiaries, or by the Partnership and one
or more other Subsidiaries.
"Taking" means the acquisition or condemnation by eminent domain of the
whole or any part of the Premises (as such term is defined in Section 1.1 of the
Senior Partnership Upstream Note Mortgage), by a competent authority, for any
public or quasi-public use or purpose.
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"TCHI Note Guarantee Mortgage", means the Indenture of Mortgage and
Security Agreement, dated as of the date hereof, between the Trustee as
mortgagee, and the Partnership, as mortgagor, a copy of which is attached hereto
as Exhibit D.
"TCHI Note Indenture", means this indenture, relating to the Issuer's
Senior Notes.
"TCHI Note Mortgage Documents" means (i) the Senior Partnership Upstream
Note, (ii) the Senior Guarantee, (iii) the Senior Partnership Upstream Note
Mortgage, (iv) the TCHI Note Guarantee Mortgage, (v) the Senior Upstream
Assignment Agreement, (vi) the Intercreditor Agreement, (vii) the Assignment of
Leases and Rents and the Assignment of Operating Assets and (viii) any other
security document to which the Partnership, the Issuer or the Trustee is a party
which is executed and delivered pursuant to or in connection with the foregoing
documents, as each may be amended, unsecured, extended, substituted, refinanced,
replaced, extended or otherwise modified from time to time in accordance with
the provisions of this TCHI Note Indenture and the TCHI Note Mortgage Documents.
"Temporary Cash Investments" means (a) any evidence of Indebtedness,
maturing not more than one year after the date of acquisition, issued by the
United States of America, or an instrumentality or agency thereof and guaranteed
fully as to principal, premium, if any, and interest by the United States of
America, (b) any certificate of deposit, maturing not more than one year after
the date of acquisition, issued by, or time deposit of, a commercial banking
institution that is a member of the Federal Reserve System and that has combined
capital and surplus and undivided profits of not less than $300,000,000, whose
debt has a rating, at the time as of which any investment therein is made, of
"P-1" (or higher) according to Moody's Investors Service, Inc. or any successor
rating agency, or "A-1" (or higher) according to Standard & Poor's Corporation
or any successor rating agency, (c) commercial paper, maturing not more than one
year after the date of acquisition, issued by a corporation (other than an
Affiliate or subsidiary of the Partnership) organized and existing under the
laws of the United States of America with a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to Moody's Investors
Service, Inc. or any successor rating agency, or "A-1" (or higher) according to
Standard & Poor's Corporation or any successor rating agency, and (d) any money
market deposit accounts issued or offered by a domestic commercial bank having
capital and surplus in excess of $300,000,000.
"Total Taking or Casualty" means a Taking or Casualty with respect to
which, pursuant to the provisions of the Senior Partnership Upstream Note
Mortgage, any proceeds resulting from such Taking or Casualty are to be used to
pay amounts due under the Senior Notes and the Senior Partnership Upstream Note
Mortgage and not for purposes of Restoration.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
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"Trustee" means the Person named as the "Trustee" in the first paragraph
of this instrument, until a successor trustee shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Trustee" shall mean
such successor trustee.
"Voting Stock" means stock of the class or classes pursuant to which the
holders thereof have the general voting power under ordinary circumstances to
elect at least a majority of the board of directors, managers or trustees of a
corporation (irrespective of whether or not at the time stock of any other class
or classes shall have or might have voting power by reason of the happening of
any contingency).
"Wholly-owned Subsidiary" means a Subsidiary all the Capital Stock of
which is owned by the Partnership or by one or more Wholly-owned Subsidiaries or
by the Partnership and one or more Wholly-owned Subsidiaries; provided, however,
that the Issuer shall not be considered a Wholly-owned Subsidiary of the
Guarantor.
"Working Capital Facility" means one or more lending agreements or note
purchase agreements between the Partnership and responsible financing sources,
pursuant to which the Partnership may incur Indebtedness to meet its working
capital requirements in an aggregate principal amount at any one time
outstanding not to exceed $10,000,000 (it being understood that indebtedness of
the Partnership pursuant to the Senior Notes and the Senior Partnership Upstream
Note represents a part of the Working Capital Facility).
Section 1.2 Other Definitions.
Defined in
Term Section
---- -------
"Act" ..........................................................1.5(a)
"Change of Control Offer""......................................10.13
"Change of Control Purchase Date"...............................10.13
"Change of Control Purchase Price"..............................10.13
"covenant defeasance"...........................................4.3
"Defaulted Interest"............................................3.7
"defeasance"....................................................4.2
"Defeased Senior Notes".........................................4.1
"incorporated provision"........................................1.8
"Restricted Payment"............................................10.9
"Surviving Entity"..............................................8.1
"U.S. Government Obligations"...................................4.4
Section 1.3. Compliance Certificates and Opinions.
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Upon any application or request by the Issuer or the Partnership to the
Trustee to take any action under any provision of this Indenture, the Issuer,
the Partnership and any other obligor on the Senior Notes shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Indenture (including any covenant compliance with which
constitutes a condition precedent) relating to the proposed action have been
complied with, and an Opinion of Counsel to the effect that in the opinion of
such counsel all such conditions precedent, if any, have been complied with,
except that, in the case of any such application or request as to which the
furnishing of any certificates and/or opinions is specifically required by any
provision of this Indenture relating to such particular application or request,
no additional certificate or opinion need be furnished.
Every Officers' Certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(a) a statement to the effect that each individual or firm signing such
certificate or opinion has read such covenant or condition and the definitions
herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement to the effect that, in the opinion of each such individual
or firm, he or it has made such examination or investigation as is necessary to
enable him or it to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such individual or
such firm, such condition or covenant has been complied with.
Section 1.4. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Issuer, the Partnership or
any other obligor of the Senior Notes may be based, insofar as it relates to
legal matters, upon a certificate or opinion of, or representations by, counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to the matters
upon which his certificate or opinion is based are erroneous. Any certificate or
opinion of such an officer or of counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Issuer, the
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Partnership or other obligor of the Senior Notes with respect to such factual
matters and which contains a statement to the effect that the information with
respect to such factual matters is in the possession of the Issuer, the
Partnership, or other obligor of the Senior Notes, unless such officer or
counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous. Opinions of Counsel required to be delivered to the Trustee may have
qualifications customary for opinions of the type required and counsel
delivering such opinions of Counsel may rely on certificates of the Issuer, the
Partnership or government or other officials customary for opinions of the type
required, including certificates certifying as to matters of fact, including
assertions as to compliance with various financial covenants.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.5. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is herein expressly required, to the Issuer. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and conclusive in favor of the Trustee and the Issuer, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any reasonable manner which the Trustee
deems sufficient.
(c) The ownership of the Senior Notes shall be proved by the Senior Note
Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Senior Note shall bind every future Holder
of the Senior Notes or the Holder of every Senior Note issued upon the transfer
thereof or in exchange therefor or in lieu thereof, in respect of anything done,
suffered or omitted to be done by the Trustee, any Paying Agent or the Issuer in
reliance thereon, whether or not notation of such action is made upon such
Senior Note.
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Section 1.6. Notices, etc., to Trustee, the Issuer, the Partnership, the
CCC and the NJDGE.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of the Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with:
(a) the Trustee by any Holder or by the Issuer or the Partnership shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if made, given, furnished or filed, in writing, to or with the Trustee
at 180 East Fifth Street, St. Paul, Minnesota 55101, Attention: Corporate Trust
Department, or at any other address previously furnished in writing to the
Holders, the Issuer or the Partnership by the Trustee;
(b) the Issuer or the Partnership shall be sufficient for every purpose
(except as provided in Section 5.1(b) hereunder) if in writing and mailed,
first-class postage prepaid or delivered by recognized overnight courier, to the
Issuer or the Partnership addressed to it at Brigantine Boulevard and Huron
Avenue, Atlantic City, New Jersey 08401, Attention: Chief Financial Officer, or
at any other address previously furnished in writing to the Trustee by the
Issuer or the Partnership, as the case may be;
(c) the CCC shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if made, given, furnished or filed, in
writing, to or with the CCC at Tennessee Avenue and The Boardwalk, Arcade
Building, Atlantic City, New Jersey 08401; or
(d) the NJDGE shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if made, given, furnished or filed, in
writing to or with the NJDGE at Hughes Justice Complex, CN-047, Trenton, New
Jersey 08625.
Section 1.7. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Senior Note Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Any notice when mailed to a Holder in the
aforesaid manner shall be conclusively deemed to have been received by such
Holder whether or not actually received by such Holder. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing
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shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason
of any other cause, it shall be impracticable to mail notice of any event as
required by any provision of this Indenture, then any method of giving such
notice as shall be reasonably satisfactory to the Trustee shall be deemed to be
a sufficient giving of such notice.
Section 1.8. Conflict with Trust Indenture Act.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 3.10 to 3.18,
inclusive, of the Trust Indenture Act, or conflicts with any provision (an
"incorporated provision") required by or deemed to be included in this Indenture
by operation of such Sections of the Trust Indenture Act, such imposed duties or
incorporated provision shall control. If any provision of this Indenture
modifies or excludes any provision of the Trust Indenture Act that may be so
modified or excluded, the latter provision shall be deemed to apply to this
Indenture as so modified or excluded, as the case may be.
Section 1.9. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 1.10 Successors and Assigns.
All covenants and agreements in this Indenture by the Issuer and the
Partnership shall bind their successors and assigns, whether so expressed or
not.
Section 1.11 Separability Clause.
In case any provision in this Indenture or in the Senior Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 1.12 Benefits of Indenture.
Nothing in this Indenture or in the Senior Notes, express or implied,
shall give to any Person (other than the parties hereto and their successors
hereunder, any Paying Agent and the Holders) any benefit or any legal or
equitable right, remedy or claim under this Indenture.
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Section 1.13 GOVERNING LAW.
THIS INDENTURE, THE SENIOR NOTES AND THE SENIOR GUARANTEE SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
(WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF).
Section 1.14 Casino Control Act.
Each of the provisions of this Indenture is subject to and shall be
enforced in compliance with the provisions of the New Jersey Casino Control Act,
unless such provisions are in conflict with the Trust Indenture Act in which
case the Trust Indenture Act shall control.
Section 1.15 Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Senior Note shall not be a Business Day, then (notwithstanding
any other provision of this Indenture or of the Senior Notes) payment of
interest or principal or, premium, if any, need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity and no interest shall accrue with respect to such payment for the
period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, to the next succeeding Business Day.
Section 1.16 Schedules.
All schedules attached hereto are by this reference made a part hereof
with the same effect as if herein set forth in full.
Section 1.17 Counterparts.
This Indenture may be executed in any number of counterparts, each of
which shall be an original; but such counterparts shall together constitute but
one and the same instrument.
ARTICLE 2
FORM OF SENIOR NOTES
Section 2.1. Forms Generally.
The Senior Notes and the Trustee's certificate of authentication shall be
in substantially the forms set forth in this Article, with such appropriate
insertions, omissions, substitutions and
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other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange, any organizational document or governing instrument or any
applicable law, including the federal securities laws, or as may, consistently
herewith, be determined by the officers executing such Senior Notes, as
evidenced by their execution of the Senior Notes. Any portion of the text of any
Senior Note may be set forth on the reverse thereof, with an appropriate
reference thereto on the face of the Senior Note.
The definitive Senior Notes shall be printed, lithographed or engraved or
produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Senior
Notes may be listed, all as determined by the officers executing such Senior
Notes, as evidenced by their execution of such Senior Notes.
Section 2.2. Form of Face of the Senior Notes.
The form of the face of the Senior Notes shall be substantially as
follows:
TRUMP'S CASTLE HOTEL & CASINO, INC.
[If Series A Notes, then insert --
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM AND IN ANY EVENT MAY BE SOLD OR OTHERWISE
TRANSFERRED ONLY IN ACCORDANCE WITH THE INDENTURE, COPIES OF WHICH ARE AVAILABLE
FOR INSPECTION AT THE CORPORATE TRUST OFFICE OF THE TRUSTEE. THE EXEMPTION
PROVIDED BY RULE 144A UNDER THE SECURITIES ACT MAY BE AVAILABLE TO PERMIT SALE
OR TRANSFER OF THIS SECURITY TO QUALIFIED INSTITUTIONAL BUYERS (WITHIN THE
MEANING OF RULE 144A) WITHOUT REGISTRATION.
EACH HOLDER OF THIS SECURITY REPRESENTS TO THE ISSUER THAT (A) SUCH HOLDER
WILL NOT SELL OR OTHERWISE TRANSFER THIS SECURITY (WITHOUT CONSENT OF THE
ISSUER) PRIOR TO TWO YEARS FROM THE LATER OF APRIL 17, 1998 OR THE DATE ON WHICH
THIS SECURITY WAS LAST HELD BY AN AFFILIATE OF THE ISSUER OTHER THAN (I) TO A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION COMPLYING WITH RULE 144A, (II) TO
A NON-U.S.
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PERSON IN A TRANSACTION COMPLYING WITH REGULATION S UNDER THE SECURITIES ACT,
(III) FOLLOWING ONE YEAR FROM SUCH TIME, IN A TRANSACTION COMPLYING WITH RULE
144 UNDER THE SECURITIES ACT OR (IV) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT (IT BEING UNDERSTOOD THAT AS A
CONDITION TO THE REGISTRATION OF TRANSFER OF ANY SECURITIES, THE ISSUER OR THE
TRUSTEE MAY IN CIRCUMSTANCES EITHER OF THEM BELIEVES APPROPRIATE, REQUIRE
EVIDENCE AS TO COMPLIANCE WITH ANY SUCH EXEMPTION) AND THAT (B) THE HOLDER WILL,
AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY
FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.]
[If Series A Notes, then insert -- 10 1/4% Series A Senior Secured Note
due 2003]
[If Series B Notes, then insert -- 10 1/4% Senior Secured Note due 2003]
No. _______ $_______________
TRUMP'S CASTLE HOTEL & CASINO, INC., a New Jersey corporation (herein
called the "Issuer," which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to ____________ or registered assigns, the principal sum of _______________
United States dollars on April 30, 2003 at the office or agency of the Issuer
referred to below, and to pay interest thereon semiannually on April 30 and
October 31 of each year commencing on October 31, 1998, or if any such day is
not a Business Day, on the next succeeding Business Day (each an "Interest
Payment Date") from the most recent Interest Payment Date on which interest has
been paid (or from the date hereof if no interest has been paid) at the rate of
10 1/4% per annum until the principal hereof is paid or duly provided for.
So long as this Senior Note constitutes a Registrable Series A Note (as
defined in the Indenture), the Holder hereof is entitled to certain liquidated
damages provided for in Section 4 of the Registration Rights Agreement in the
event, as more fully described therein, that, and so long as, the Issuer fails
to timely implement its commitment to register the Senior Notes under the
Securities Act (as defined in the Indenture).
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Senior Note (or one or more Predecessor Senior Notes) is
registered at the close of business on the Regular Record Date for such
interest, which shall be April 15 or October 15 (whether or not a Business Day),
as the case may be, next preceding such Interest Payment Date. Any such interest
not so paid, or duly provided for, and interest on such defaulted interest at
the interest
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rate borne by the Senior Notes, to the extent lawful, shall forthwith cease to
be payable to the Holder on such Regular Record Date, and may be paid to the
Person in whose name this Senior Note (or one or more Predecessor Senior Notes)
is registered at the close of business on a Special Record Date for the payment
of such defaulted interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Senior Notes not less than ten days prior to such Special
Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Senior Notes may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture.
Payment of the principal of, premium, if any, and interest on this Senior
Note will be made at the office or agency of the Issuer maintained for that
purpose in The City of New York, or at such other office or agency of the Issuer
as may be maintained for such purpose, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that payment of interest may be
made at the option of the Issuer by check mailed to the address of the Person
entitled thereto as such address shall appear on the Senior Note Register.
Interest shall be computed on the basis of a 360-day year of twelve 30-day
months.
This Senior Note is one of the Senior Notes issued and to be issued from
time to time under and in accordance with, the Indenture, all equally secured by
an assignment to the Trustee by the Issuer of a promissory note made by Trump's
Castle Associates, L.P., and of an Indenture of Mortgage and Security Agreement,
dated as of even date with the Indenture referred to herein, (hereinafter as
amended and supplemented the "Senior Partnership Upstream Note Mortgage"), to
which Senior Partnership Upstream Note Mortgage reference is made for a
description of the property mortgaged and pledged, the return and extent of the
security, and the other provisions thereof.
Reference is hereby made to the further provisions of this Senior Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee or by the authenticating agent appointed as provided in the
Indenture by manual signature, this Senior Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by the manual or facsimile signature of its authorized officers and its
corporate seal to be affixed or reproduced hereon.
Dated: TRUMP'S CASTLE HOTEL
& CASINO, INC.
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Attest:__________________ By _____________________
Name: Name:
Title: Title:
(SEAL]
Section 2.3 Form of Reverse of the Senior Notes
The form of the reverse of the Senior Notes shall be substantially as
follows:
This Senior Note is one of a duly authorized issue of Senior Notes of the
Issuer designated as its [If Series A Notes, then insert - 10 1/4% Series A
Senior Secured Notes due 2003 (the "Series A Notes")] [If Series B Notes, then
insert - 10 1/4% Senior Secured Notes due 2003 (the "Series B Notes")] issued
under an Indenture, dated as of April 17, 1998 (herein called the "Indenture"),
between the Issuer, U.S. Bank National Association, a national banking
association, as trustee (herein called the "Trustee," which term includes any
successor trustee under the Indenture) and Trump's Castle Associates, L.P., a
New Jersey limited partnership (the "Partnership"), as guarantor [If Series A
Notes, then insert - , together with the 10 1/4% Senior Secured Notes due 2003
of the Issuer (the "Series B Notes", and collectively with the Series A Notes,
the "Senior Notes")] [If Series B Notes, then insert - , together with the 10
1/4% Series A Senior Secured Notes due 2003 of the Issuer (the "Series A Notes,"
and collectively with the Series B Notes, the "Senior Notes")]. The Senior Notes
are limited in aggregate principal amount of up to $5,000,000. Reference is
hereby made to the Indenture and all indentures supplemental thereto for a
statement of the respective rights, limitations of rights, duties, obligations
and immunities thereunder of the Issuer, the Trustee, the Partnership, other
obligors thereunder and the Holders of the Senior Notes, and of the terms upon
which the Senior Notes are, and are to be, authenticated and delivered.
If the Issuer or the Partnership is served with notice of the
disqualification of any Holder under N.J.S.A. ss. 5:12-105(d) by the CCC, such
Holder will be prohibited under N.J.S.A. ss. 5:12-105(e) from (a) receiving
interest on the Senior Notes held by such Holder, (b) exercising directly or
through any trustee or nominee, any right conferred on such Senior Notes and (c)
receiving any remuneration in any form from any company licensed by the CCC
(including the Issuer, the Partnership and the Trustee) for services rendered or
otherwise.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness on this Senior Note and (b) certain restrictive covenants
and related Defaults and Events of Default, in each case upon compliance with
certain conditions set forth therein.
In the event of a Total Taking or Casualty, the Issuer or the Partnership
shall, within 60 days after receipt of any condemnation or insurance proceeds,
but in all events within one year after the occurrence of such Total Taking or
Casualty, redeem the Senior Notes at 100% of the
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principal amount thereof, in each case, together with accrued and unpaid
interest through the Redemption Date, all as provided in the Indenture.
Notwithstanding the foregoing, each Holder by accepting a Senior Note
agrees that if the CCC does not waive the qualification requirement as to the
Holder (whether the record owner or beneficial owner) of this Senior Note and
requires that the Holder be qualified under the New Jersey Casino Control Act,
then, in such event, the Holder must qualify under such Act. If the Holder does
not so qualify, the Holder must dispose of its interest in this Senior Note,
within 30 days (or within such earlier date as the CCC may require) after the
Issuer's receipt of notice of such finding, or the Issuer may redeem this Senior
Note at the lower of the Outstanding Amount and the Fair Market Value of this
Senior Note, without premium, all as provided in the Indenture.
In the case of any redemption of Senior Notes, interest installments whose
Stated Maturity is on or prior to the Redemption Date will be payable to the
Holders of such Senior Notes (or one or more Predecessor Senior Notes), of
record at the close of business on the relevant Record Date referred to on the
face hereof. Senior Notes (or portions thereof) for whose redemption and payment
provision is made in accordance with the Indenture shall cease to bear interest
from and after the date fixed for redemption.
In the event of redemption of this Senior Note in part only, a new Senior
Note or Senior Notes for the unredeemed portion hereof shall be issued in the
name of the Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, there may be
declared due and payable in the manner and with the effect provided in the
Indenture the principal of this Senior Note, plus all accrued and unpaid
interest to and including the date this Senior Note is paid.
If a Change of Control occurs at any time, each Holder shall have the
right to require that the Issuer repurchase such Holder's Senior Notes in whole
or in part in integral multiples of $1,000 at a purchase price in cash in an
amount equal to 101% of the principal amount thereof plus accrued and unpaid
interest (including any Defaulted Interest), if any, to the date of purchase.
The Indenture permits, with certain exceptions as therein provided,
amendments and modifications of the rights and obligations of the Issuer and the
Partnership and the rights of the Holders under the Indenture and the TCHI Note
Mortgage Documents at any time by the Issuer, the Partnership, and the Trustee
with the consent of the Holders of not less than a majority in aggregate
principal amount of the Senior Notes at the time Outstanding. The Indenture also
contains provisions permitting the Holders of specified percentages in aggregate
principal amount of the Senior Notes at the time Outstanding, on behalf of the
Holders of all the Senior Notes, to waive compliance by the Issuer or the
Partnership with certain provisions of the Indenture and certain past Defaults
under the Indenture and their consequences. Any such
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consent or waiver by or on behalf of the Holder of this Senior Note shall be
conclusive and binding upon such Holder and upon all future Holders of this
Senior Note and of any Senior Note issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Senior Note.
No reference herein to the Indenture or to the TCHI Note Mortgage
Documents and no provision of this Senior Note or of the Indenture or of the
TCHI Note Mortgage Documents shall alter or impair the obligation of the Issuer,
the Partnership or any other obligor under the Senior Notes (in the event the
Partnership or any such obligor is obligated to make payments in respect of the
Senior Notes), which is absolute and unconditional, to pay the principal of,
premium, if any, and interest on this Senior Note at the times, place, and rate,
and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Senior Note is registrable on the Senior Note
Register of the Issuer, upon surrender of this Senior Note for registration of
transfer at the office or agency of the Issuer maintained for such purpose in
The City of New York or at such other office or agency of the Issuer as may be
maintained for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Issuer and the Senior Note
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Senior Notes, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The Senior Notes are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, such Senior
Notes are exchangeable for a like aggregate principal amount of Senior Notes of
a different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any registration of transfer or
exchange or redemption of Senior Notes, but the Issuer may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to and at the time of due presentment of this Senior Note for
registration of transfer, the Issuer, the Trustee and any agent of the Issuer or
the Trustee may treat the Person in whose name this Senior Note is registered as
the owner hereof for all purposes, whether or not this Senior Note is overdue,
and neither the Issuer, the Trustee nor any agent shall be affected by notice to
the contrary.
Notwithstanding anything herein (including the Senior Guarantee) or in any
other agreement, document, certificate, instrument, statement or omission
referred to below to the contrary, the Partnership and the Issuer are liable
hereunder only to the extent of the assets of the Partnership and the Issuer and
no other person or entity, including, but not limited to, any
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partner, officer, committee or committee member of the Partnership or any
partner therein or of any Affiliate of the Partnership, or any incorporator,
officer, director or shareholder of the Issuer, or any Affiliate or controlling
Person or entity of any of the foregoing, or any agent, employee or lender of
any of the foregoing, or any successor, personal representative, heir or assign
of any of the foregoing, in each case past, present, or as they may exist in the
future, shall be liable in any respect (including without limitation the breach
of any representation, warranty, covenant, agreement, condition or
indemnification or contribution undertaking contained herein or therein) under,
in connection with, arising out of, or relating to this Senior Note, the
Indenture, the TCHI Note Mortgage Documents or any other agreement, document,
certificate, instrument or statement (oral or written) related to, executed or
to be executed, delivered or to be delivered, or made or to be made, or any
omission made or to be made, in connection with any of the foregoing or any of
the transactions contemplated in any such agreement, document, certificate,
instrument or statement.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer or disposition of all or substantially all of the properties and assets
of the Issuer or the Partnership in accordance with the Indenture, subject to
the terms and conditions of the Indenture, the successor Person to such
transaction shall become the obligor or guarantor on this Senior Note and the
TCHI Note Mortgage Documents and the Issuer or Partnership, as the case may be,
shall be discharged from all obligations and covenants under this Senior Note,
the TCHI Note Mortgage Documents and the Indenture.
All terms used in this Senior Note which are defined in the Indenture and
not otherwise defined herein shall have the meanings assigned to them in the
Indenture.
Section 2.4 Form of Trustee's Certificate of Authentication
The form of certificate of authentication shall be substantially as
follows:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
This is one of the Senior Notes referred to in the within-mentioned
Indenture.
U.S. BANK NATIONAL ASSOCIATION,
As Trustee
Dated: By
------------------ ------------------
Authorized Signatory
Section 2.5 Form of Senior Guarantee.
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The form of Senior Guarantee shall be set forth on the Senior Notes
substantially as follows:
SENIOR GUARANTEE BY
TRUMP'S CASTLE ASSOCIATES, L.P.
For value received, Trump's Castle Associates, L.P., a New Jersey limited
partnership, hereby unconditionally guarantees to the Holder of this Senior Note
the payment of principal of, premium, if any, and interest on this Senior Note
in the amounts and at the time when due and interest on the overdue principal
and interest, if any, of this Senior Note, if lawful, and the payment or
performance of all other obligations of the Issuer under the Indenture or the
Senior Notes, to the Holder of this Senior Note and the Trustee, all in
accordance with and subject to the terms and limitations of this Senior Note and
Article Fourteen of the Indenture. This Senior Guarantee is secured by a certain
Indenture of Mortgage and Security Agreement, dated of even date with the
Indenture referred to in this Senior Note, between Trump's Castle Associates,
L.P. as mortgagor, and U.S. Bank National Association, Trustee, as mortgagee, to
which reference is hereby made for a full statement of its terms and conditions.
This Senior Guarantee is without recourse to the partners of the Partnership and
will not become effective until the Trustee duly executes the certificate of
authentication on this Senior Note.
Dated: TRUMP'S CASTLE ASSOCIATES, L.P.
-------------------------- By Trump's Castle Hotel & Casino,
Inc., its General Partner
Attest: By
------------------------- -------------------------
Authorized Signature Name:
Title:
(SEAL)
ARTICLE 3
THE SENIOR NOTES
Section 3.1 Title and Terms.
The aggregate principal amount of Senior Notes which may be authenticated
and delivered under this Indenture is limited to $5,000,000, except for Senior
Notes authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Senior Notes pursuant to Section 3.3, 3.4,
3.5, 3.6, 9.6 or 10.13. The Senior Notes are being issued in two series, the
Series A Notes and the Series B Notes.
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The Series A Notes are initially being issued pursuant to an exemption
from registration under the Securities Act. After the initial issuance date of
the Series A Notes, Series B Notes will be issued in exchange for an equal
principal amount of outstanding Series A Notes (i) pursuant to the Registered
Exchange Offer (as defined in the Registration Rights Agreement), (ii) if a
registration statement covering the resale of Series B Notes has been declared
effective, in which case the Series A Notes will be exchanged for Series B Notes
immediately prior to the disposition of Series B Notes pursuant to the
registration statement, (iii) at the request of the Holder of the Series A
Notes, immediately prior to the disposition of such Senior Notes pursuant to
Rule 144, if the Holder of the Series A Notes delivers to the Trustee an Opinion
of Counsel stating that as a result of such disposition the Senior Notes being
disposed of will no longer be Restricted Securities or (iv) if the Holder of the
Series A Notes delivers to the Trustee an Opinion of Counsel stating that the
Series A Notes are no longer Restricted Securities.
Upon any such exchange the Series A Notes shall be cancelled in accordance
with Section 3.9 and shall no longer be deemed Outstanding for any purpose.
Subject to Section 3.6 hereof, in no event shall the aggregate principal amount
of both of the Series A Notes and Series B Notes Outstanding exceed $5,000,000.
The Series A Notes shall be known and designated as the " 10 1/4% Series A
Senior Secured Notes due 2003" of the Issuer and the Series B Notes shall be
known and designated as the " 10 1/4% Series B Senior Secured Notes due 2003" of
the Issuer. The Senior Notes shall be known and designated as the " 10 1/4%
Senior Secured Notes due 2003" of the Issuer. The Stated Maturity of the Senior
Notes shall be April 30, 2003. The Senior Notes, shall bear interest on the
principal amount thereof at the rate of 10 1/4% per annum (subject, in the case
of the Series A Notes, to certain liquidation damages provided for in the
Registration Rights Agreement), payable semiannually on April 30 and October 31
in each year, commencing October 31, 1998, until the principal thereof is paid
or duly provided for. Interest on any overdue principal, interest (to the extent
lawful) or premium, if any, shall be payable on demand.
The principal of, premium, if any, and interest on Senior Notes shall be
payable at the office or agency of the Issuer maintained for such purpose in The
City of New York, or at such other office or agency of the Issuer as may be
maintained for such purpose; provided, however, that at the option of the Issuer
interest may be paid by check mailed to addresses of the Persons entitled
thereto as such addresses shall appear on the Senior Note Register.
The Senior Notes shall be redeemable as provided in Article Eleven.
At the election of the Issuer and the Partnership, the entire indebtedness
on the Senior Notes or certain of the Issuer's or the Partnership's obligations
and covenants and certain Events of Default thereunder may be defeased as
provided in Article Four.
The Senior Notes shall be secured as provided in Article Twelve.
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If the Issuer or the Partnership is served with notice of the
disqualification of any Holder under N.J.S.A. ss.5:12-105(d) by the CCC, such
Holder will be prohibited under N.J.S.A. ss. 5:12-105(e) from (a) receiving
interest on the Senior Notes held by such Holder, (b) exercising directly or
through any trustee or nominee, any right conferred on such Senior Notes and (c)
receiving any remuneration in any form from any company licensed by the CCC
(including the Issuer, the Partnership and the Trustee) for services rendered or
otherwise.
Section 3.2 Denominations.
The Senior Notes shall be issuable only in registered form without coupons
and only in denominations of $1,000 and in integral multiples thereof.
Section 3.3 Execution, Authentication, Delivery and Dating.
The Senior Notes shall be executed on behalf of the Issuer by its Chairman
of the Board of Directors, Vice Chairman, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Senior Notes may be manual or facsimile.
Senior Notes bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Senior Notes or did not
hold such offices on the date of such Senior Notes.
At any time and from time to time after the execution and delivery of this
Indenture, the Issuer may deliver Senior Notes executed by the Issuer to the
Trustee for authentication, together with an Issuer Order for the authentication
and delivery of such Senior Notes; and the Trustee in accordance with such
Issuer Order shall authenticate and deliver such Senior Notes as provided in
this Indenture and not otherwise.
Each Senior Note shall be dated the date of its authentication.
No Senior Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Senior Note a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Senior Note shall be conclusive evidence, and the only
evidence, that such Senior Note has been duly authenticated and delivered
hereunder.
In case the Issuer or the Partnership, pursuant to Article Eight, shall be
consolidated, merged with or into any other Person or shall sell, convey,
assign, transfer or lease substantially all of its properties and assets to any
Person, and the successor Person resulting from such consolidation, or surviving
such merger, or into which the Issuer or the Partnership shall have
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been consolidated or merged, or the Person which shall have received a
conveyance, transfer or lease as aforesaid, shall have executed an indenture
supplemental hereto with the Trustee pursuant to Article Eight, any of the
Senior Notes authenticated or delivered prior to such consolidation, merger,
conveyance, transfer or lease may, from time to time, at the request of the
successor Person, be exchanged for other Senior Notes executed in the name of
the successor Person with such changes in phraseology and form as may be
appropriate, but otherwise in substance of like tenor as the Senior Notes
surrendered for such exchange and of like principal amount; and the Trustee,
upon the request of the successor Person, shall authenticate and deliver Senior
Notes as specified in such Request for the purpose of such exchange. If Senior
Notes shall at any time be authenticated and delivered in any new name of a
successor Person pursuant to this Section in exchange or substitution for or
upon registration of transfer of any Senior Notes, such successor Person, at the
option of the Holders but without expense to them, shall provide for the
exchange of all Senior Notes at the time Outstanding for Senior Notes
authenticated and delivered in such new name.
The Trustee may appoint an authenticating agent acceptable to the Issuer
to authenticate Senior Notes on behalf of the Trustee. Unless limited by the
terms of such appointment, an authenticating agent may authenticate Senior Notes
whenever the Trustee may do so except upon original issuance. Each reference in
this Indenture to authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as any Senior Note Registrar
or Paying Agent to deal with the Issuer and its Affiliates.
Section 3.4 Temporary Securities.
Pending the preparation of definitive Senior Notes, the Issuer may
execute, and upon order of the Issuer the Trustee shall authenticate and
deliver, temporary Senior Notes which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Senior Notes in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Senior Notes may determine, as
conclusively evidenced by their execution of such temporary Senior Notes.
If temporary Senior Notes are issued, the Issuer will cause definitive
Senior Notes to be prepared without unreasonable delay. After the preparation of
definitive Senior Notes, the temporary Senior Notes shall be exchangeable for
definitive Senior Notes upon surrender of the temporary Senior Notes at the
office or agency of the Issuer designated for such purpose pursuant to Section
10.2, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Senior Notes the Issuer shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Senior Notes of authorized denominations. Until so exchanged the
temporary Senior Notes shall in all respects be entitled to the same benefits
under this Indenture as definitive Senior Notes.
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Section 3.5 Registration, Registration of Transfer and Exchange.
The Issuer shall cause to be kept at the Corporate Trust Office of the
Trustee, or such other office as the Trustee may designate, a register (the
register maintained in such office and in any other office or agency designated
pursuant to Section 10.2 being herein sometimes referred to as the "Senior Note
Register") in which, subject to such reasonable regulations as the Senior Note
Registrar may prescribe, the Issuer shall provide for the registration of Senior
Notes and of transfers of Senior Notes. The Trustee is hereby initially
appointed "Senior Note Registrar" for the purpose of registering Senior Notes
and transfers of Senior Notes as herein provided.
Upon surrender for registration of transfer of any Senior Note in
certificated form at the office or agency of the Issuer designated pursuant to
Section 10.2, the Issuer shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Senior Notes of any authorized denomination or denominations, of a like
aggregate principal amount.
At the option of the Holder, Senior Notes may be exchanged for other
Senior Notes of any authorized denomination or denominations, of a like
aggregate principal amount, upon surrender of the Senior Notes to be exchanged
at such office or agency. Whenever any such Senior Notes are so surrendered for
exchange, the Issuer shall execute, and the Trustee shall authenticate and
deliver, the Senior Notes which the Holder making the exchange is entitled to
receive.
All Senior Notes issued upon any registration of transfer or exchange of
Senior Notes shall be the valid obligations of the Issuer, evidencing the same
Indebtedness, and entitled to the same benefits under this Indenture, as the
Senior Notes surrendered upon such registration of transfer or exchange.
Every Senior Note presented or surrendered for registration of transfer,
or for exchange or redemption shall (if so required by the Issuer or the
Trustee) be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Issuer and the Senior Note Registrar, duly executed
by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made to a Holder for any registration of
transfer or exchange or redemption of Senior Notes, but the Issuer may require
payment of a sum sufficient to pay all documentary, stamp or similar issue or
transfer taxes or other governmental charges that may be imposed in connection
with any registration of transfer or exchange of Senior Notes, other than
exchanges pursuant to Section 3.3, 3.4, 9.6, 10.13, or 11.10 not involving any
transfer.
The Issuer shall not be required (a) to issue, register the transfer of or
exchange any Senior Note during a period beginning at the opening of business 15
days before the mailing of a notice of redemption of the Senior Notes selected
for redemption under Section 11.6 and ending
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at the close of business on the day of such mailing, or (b) to register the
transfer of or exchange any Senior Note so selected for redemption in whole or
in part, except the unredeemed portion of Senior Notes being redeemed in part.
All Series A Notes issued hereunder shall bear the following legend:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM AND IN ANY EVENT MAY BE SOLD OR OTHERWISE
TRANSFERRED ONLY IN ACCORDANCE WITH THE INDENTURE, COPIES OF WHICH ARE AVAILABLE
FOR INSPECTION AT THE CORPORATE TRUST OFFICE OF THE TRUSTEE. THE EXEMPTION
PROVIDED BY RULE 144A UNDER THE SECURITIES ACT MAY BE AVAILABLE TO PERMIT SALE
OR TRANSFER OF THIS SECURITY TO QUALIFIED INSTITUTIONAL BUYERS (WITHIN THE
MEANING OF RULE 144A) WITH REGISTRATION.
EACH HOLDER OF THIS SECURITY REPRESENTS TO THE ISSUER THAT (A) SUCH HOLDER
WILL NOT SELL OR OTHERWISE TRANSFER THIS SECURITY (WITHOUT CONSENT OF THIS
ISSUER) PRIOR TO TWO YEARS FROM THE LATER OF APRIL 17, 1998 OR THE DATE ON WHICH
THIS SECURITY WAS LAST HELD BY AN AFFILIATE OF THE ISSUER OTHER THAN (I) TO A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION COMPLYING WITH RULE 144A, (II) TO
A NON-U.S. PERSON IN A TRANSACTION COMPLYING WITH REGULATION S UNDER THE
SECURITIES ACT, (III) FOLLOWING ONE YEAR FROM SUCH TIME, IN A TRANSACTION
COMPLYING WITH RULE 144 UNDER THE SECURITIES ACT OR (IV) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT (IT BEING
UNDERSTOOD THAT AS A CONDITION TO THE REGISTRATION OF TRANSFER OF ANY
SECURITIES, THE ISSUER OR THE TRUSTEE MAY IN CIRCUMSTANCES EITHER OF THEM
BELIEVES APPROPRIATE, REQUIRE EVIDENCE AS TO COMPLIANCE WITH ANY SUCH EXEMPTION)
AND THAT (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO NOTIFY
ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN
(A) ABOVE.
Each certificate evidencing a Series A Note (and all Senior Notes issued
in exchange therefor or substitution thereof), until such time as the same is no
longer a Series A Note, shall bear a legend in substantially the form set forth
on the Forms of Face of Security set forth in Section 2.2 hereof. Prior to any
transfer or exchange of a legended Series A Note for a Series B Note, the Issuer
shall deliver an Officer's Certificate to the Trustee directing it to transfer
or exchange such Security for another or unlegended Note.
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Section 3.6 Mutilated, Destroyed, Lost and Stolen Senior Notes.
If (a) any mutilated Senior Note is surrendered to the Trustee, or (b) the
Issuer and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Senior Note, and there is delivered to the
Issuer and the Trustee, such security or indemnity, in each case, as may be
required by them to save each of them harmless, then, in the absence of notice
to the Issuer or the Trustee that such Senior Note has been acquired by a bona
fide purchaser, the Issuer shall execute and upon its written request the
Trustee shall authenticate and deliver, in exchange for any such mutilated
Senior Note or in lieu of any such destroyed, lost or stolen Senior Note, a
replacement Senior Note of like tenor and principal amount, bearing a number not
contemporaneously Outstanding.
In case any such mutilated, destroyed, lost or stolen Senior Note has
become or is about to become due and payable, the Issuer in its discretion may,
instead of issuing a replacement Senior Note, pay such Senior Note.
Upon the issuance of any replacement Senior Notes under this Section, the
Issuer may require the payment of a sum sufficient to pay all documentary, stamp
or similar issue or transfer taxes or other governmental charges that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every replacement Senior Note issued pursuant to this Section in lieu of
any destroyed, lost or stolen Senior Note shall constitute an original
additional contractual obligation of the Issuer, the Partnership and any other
obligor under the Senior Notes, whether or not the destroyed, lost or stolen
Senior Note shall be at any time enforceable by anyone, and shall be entitled to
all benefits of this Indenture equally and proportionately with any and all
other Senior Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Senior Notes.
Section 3.7 Payment of Interest.
Interest on any Senior Note which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Senior Note (or one or more Predecessor Senior Notes) is
registered at the close of business on the Regular Record Date for such
interest.
Any interest on any Senior Note which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date and interest on such
defaulted interest at the then applicable interest rate borne by the Senior
Notes, to the extent lawful (such defaulted interest and interest thereon herein
collectively called "Defaulted Interest") shall forthwith cease to be
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payable to the Holder on the Regular Record Date; and such Defaulted Interest
may be paid by the Issuer, at its election in each case, as provided in
Subsection (a) or (b) below:
(a) The Issuer may elect to make payment of any Defaulted Interest to the
Persons in whose names the Senior Notes (or their respective Predecessor Senior
Notes) are registered at the close of business on a Special Record Date for the
payment of such Defaulted Interest, which shall be fixed in the following
manner. The Issuer shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Senior Note and the date of the
proposed payment, and at the same time the Issuer shall deposit with the Trustee
an amount of money equal to the aggregate amount proposed to be paid in respect
of such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this Subsection provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted Interest which
shall be not more than 15 days and not less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly notify the
Issuer in writing of such Special Record Date. In the name and at the expense of
the Issuer, the Trustee shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder at his address as it appears in the
Senior Note Register, not less than 10 days prior to such Special Record Date.
Notice of the proposed payment of such Defaulted Interest and the Special Record
Date therefor having been so mailed, such Defaulted Interest shall be paid to
the Persons in whose names the Senior Notes (or their respective Predecessor
Senior Notes) are registered on such Special Record Date and shall no longer be
payable pursuant to the following Subsection (b).
(b) The Issuer may make payment to the Persons in whose name the Senior
Notes are registered at the close of business on the Special Record Date of any
Defaulted Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Senior Notes may be listed,
and upon such notice as may be required by such exchange, unless, after written
notice given by the Issuer to the Trustee of the proposed payment pursuant to
this Subsection, such manner of payment shall not be deemed practicable by the
Trustee (acting reasonably). The Trustee shall give prompt written notice to the
Issuer of any such determination.
Subject to the foregoing provisions of this Section, each Senior Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Senior Note shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Senior Note.
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Section 3.8 Persons Deemed Owners.
Prior to and at the time of due presentment for registration of transfer,
the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
Person in whose name any Senior Note is registered as the owner of such Senior
Note for the purpose of receiving payment of principal of, premium, if any, and
(subject to Section 3.7) interest on such Senior Note and for all other purposes
whatsoever, whether or not such Senior Note is overdue, and neither the Issuer,
the Trustee nor any agent of the Issuer or the Trustee shall be affected by
notice to the contrary.
Section 3.9 Cancellation.
All Senior Notes surrendered for payment, purchase, redemption or
registration of transfer or exchange shall be delivered to the Trustee and, if
not already cancelled, shall be promptly cancelled by it. The Issuer and the
Partnership may at any time deliver to the Trustee for cancellation any Senior
Notes previously authenticated and delivered hereunder which the Issuer or the
Partnership may have acquired in any manner whatsoever, and all Senior Notes so
delivered shall be promptly cancelled by the Trustee. No Senior Notes shall be
authenticated in lieu of or in exchange for any Senior Notes cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Senior Notes held by the Trustee shall be destroyed and certification
of their destruction delivered to the Issuer unless by an Issuer Order the
Issuer shall direct that the cancelled Senior Notes be returned to it. The
Trustee shall provide the Issuer a list of all Senior Notes that have been
cancelled from time to time as requested by the Issuer.
Section 3.10 Computation of Interest.
Interest on the Senior Notes shall be computed on the basis of a 360-day
year of twelve 30-day months.
Section 3.11 Non-recourse.
Notwithstanding anything herein (including the Senior Guarantee) or in any
other agreement, document, certificate, instrument, statement or omission
referred to below to the contrary, the Issuer and the Partnership are liable
hereunder and under the Senior Notes only to the extent of the assets of the
Issuer and the Partnership and the interest of the Issuer in the Senior Notes
and no other person or entity, including, but not limited to, any partner,
officer, committee or committee member of the Partnership or any partner therein
or of any Affiliate of the Partnership, or any incorporator, officer, director
or shareholder of the Issuer, or any Affiliate or controlling Person or entity
of any of the foregoing, or any agent, employee or lender of any of the
foregoing, or any successor, personal representative, heir or assign of any of
the foregoing, in each case past, present, or as they may exist in the future,
shall be liable in any respect (including without limitation the breach of any
representation, warranty, covenant,
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agreement, condition or indemnification or contribution undertaking contained
herein or therein) under, in connection with, arising out of, or relating to
this Indenture or any other agreement, document, certificate, instrument or
statement (oral or written) related to, executed or to be executed, delivered or
to be delivered, or made or to be made, or any omission made or to be made, in
connection with any of the foregoing or any of the transactions contemplated in
any such agreement, document, certificate, instrument or statement.
Notwithstanding the foregoing, the Holders preserve any personal claims they may
have for fraud, liabilities under the Securities Act, and other liabilities that
cannot be waived under applicable federal and state laws in connection with the
purchase of the Senior Notes; provided, however, that such conduct shall not
constitute an Event of Default under this Indenture, the Senior Notes or the
Senior Partnership Upstream Note Mortgage or any document executed in
conjunction therewith or otherwise related thereto. Any agreement, document,
certificate, statement or other instrument to be executed simultaneously with,
in connection with, arising out of or relating to this Indenture, the Senior
Notes or any other agreement, document, certificate, statement or instrument
referred to above, or any agreement, document, certificate, statement or
instrument contemplated hereby shall contain language mutatis mutandis to this
paragraph and, if such language is omitted, shall be deemed to contain such
language.
ARTICLE 4
DEFEASANCE AND COVENANT DEFEASANCE
Section 4.1 Option to Effect Defeasance or Covenant Defeasance.
The Issuer or the Partnership may, at their option, by Board Resolution,
at any time, with respect to the Senior Notes, elect to have either Section 4.2
or Section 4.3 be applied to all of the Outstanding Senior Notes (the "Defeased
Senior Notes"), upon compliance with the conditions set forth below in this
Article Four.
Section 4.2 Defeasance and Discharge.
Upon the Issuer's or the Partnership's exercise under Section 4.1 of the
option applicable to this Section 4.2, each of the Issuer, the Partnership and
any other obligor under the Senior Notes shall be deemed to have been discharged
from its obligations with respect to the Defeased Senior Notes on the date the
conditions set forth below are satisfied (hereinafter, "defeasance"). For this
purpose, such defeasance means that the Issuer and the Partnership shall be
deemed to have paid and discharged the entire indebtedness represented by the
Defeased Senior Notes, which shall thereafter be deemed to be "Outstanding" only
for the purposes of Section 4.5 and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all their other
obligations under such Senior Notes and this Indenture insofar as such Senior
Notes are concerned (and the Trustee, at the expense of the Issuer, and, upon
written request of the Issuer, shall execute proper instruments acknowledging
the same), except for the following
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which shall survive until otherwise terminated or discharged hereunder: (a) the
rights of Holders of Defeased Senior Notes to receive solely from the trust fund
described in Section 4.4 and as more fully set forth in such Section, payments
in respect of the principal of, premium, if any, and interest on such Senior
Notes when such payments are due, (b) the Issuer's obligations with respect to
such Defeased Senior Notes under Sections 3.4, 3.5, 3.6, 10.2 and 10.3, (c) the
rights, powers, trusts, duties, indemnities and immunities of the Trustee
hereunder and (d) this Article Four. Subject to compliance with this Article
Four, the Issuer and the Partnership may exercise their option under this
Section 4.2 notwithstanding the prior exercise of their option under Section 4.3
with respect to the Senior Notes.
Section 4.3 Covenant Defeasance.
Upon the Issuer's or the Partnership's exercise under Section 4.1 of the
option applicable to this Section 4.3, each of the Issuer, the Partnership and
any other obligor under the Senior Notes shall be released from its obligations
under any covenant or provision contained in Sections 8.1(a)(ii), (iii)(B), and
(v)(B), 8.1(b)(ii), (iv), (v) and (vii)(B), 10.5 through 10.17, 10.19 and 10.21,
and Article Twelve shall not apply with respect to the Defeased Senior Notes on
and after the date the conditions set forth below are satisfied (hereinafter,
"covenant defeasance"), and the Defeased Senior Notes shall thereafter be deemed
to be not "Outstanding" for the purposes of any direction, waiver, consent or
declaration or Act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "Outstanding"
for all other purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the Defeased Senior Notes, the Issuer, the
Partnership and any such obligor may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
Section or Article, whether directly or indirectly, by reason of any reference
elsewhere herein, in such Defeased Senior Notes or in the TCHI Note Mortgage
Documents or other documents to any such Section or Article or by reason of any
reference in any such Section or Article to any other provision herein or in any
other document and such omission to comply shall not constitute a Default or an
Event of Default under Section 5.1(c) but, except as specified above and in the
following sentence, the remainder of this Indenture and such Defeased Senior
Notes shall be unaffected thereby. Upon any covenant defeasance, the events set
forth in Sections 5.1(d), (e), (i) and (k) shall not constitute Defaults or
Events of Default hereunder and any cross-reference in the Senior Partnership
Upstream Note Mortgage to a Default or Event of Default under this Indenture
shall not be deemed to include such Defaults or Events of Default.
Section 4.4 Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either Section 4.2
or Section 4.3 to the Defeased Senior Notes:
(1) The Issuer or the Partnership shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee satisfying the
requirements of Section 6.8 who
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shall agree to comply with the provisions of this Article Four applicable to it)
as trust funds in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the benefit of
the Holders of such Senior Notes, (a) money in an amount, or (b) U.S. Government
Obligations which through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not later than one
day before the due date of any payment, money in an amount, or (c) a combination
thereof, sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge and which shall be applied by the
Trustee (or other qualifying trustee) to pay and discharge, (i) the principal
of, premium, if any, and interest on the Defeased Senior Notes on the Stated
Maturity of such principal or installment of principal or interest and (ii) any
mandatory payments applicable to the Outstanding Senior Notes on the day on
which such payments are due and payable in accordance with the terms of this
Indenture and of such Senior Notes; provided, that the Trustee (or other
qualifying trustee) shall have been irrevocably instructed to apply such money
or the proceeds of such U.S. Government Obligations to said payments with
respect to the Senior Notes. For this purpose, "U.S. Government Obligations"
means securities that are (i) direct obligations of the United States of America
for the timely payment of which its full faith and credit is pledged or (ii)
obligations of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the timely payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
States of America, which, in either case, are not callable or redeemable at the
option of the issuer thereof, and shall also include a depository receipt issued
by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian
with respect to any such obligation or a specific payment of principal of or
interest on any such obligation held by such custodian for the account of the
holder of such depository receipt, provided, that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of principal of or interest on the U.S. Government Obligation evidenced by such
depository receipt.
(2) No Default or Event of Default shall have occurred and be continuing
on the date of such deposit or, insofar as subsections 5.1(g) and (h) are
concerned, at any time during the period ending on the 91st day after the date
of such deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period).
(3) Such defeasance or covenant defeasance shall not cause the Trustee for
the Senior Notes to have a conflicting interest in violation of Section 6.7 and
for purposes of the Trust Indenture Act with respect to any securities of the
Issuer or any other obligor under the Senior Notes.
(4) Such defeasance or covenant defeasance shall not result in a breach or
violation of, or constitute a default or event of default under, this Indenture
or any other material agreement
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or instrument to which the Issuer, the Partnership or any other obligor under
the Senior Notes is a party or by which it is bound.
(5) In the case of an election under Section 4.2, the Issuer shall have
delivered to the Trustee an Opinion of Counsel stating that (x) the Issuer or
the Partnership, as the case may be, has received from, or there has been
published by, the Internal Revenue Service a ruling or (y) since the date
hereof, there has been a change in the applicable Federal income tax law, in
either case to the effect that, and based thereon such opinion shall confirm
that, the Holders of the Outstanding Senior Notes will not recognize income,
gain or loss for Federal income tax purposes as a result of such defeasance and
will be subject to Federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such defeasance had not
occurred.
(6) In the case of an election under Section 4.3, the Issuer or the
Partnership, as the case may be, shall have delivered to the Trustee an Opinion
of Counsel to the effect that the Holders of the Outstanding Senior Notes will
not recognize income, gain or loss for Federal income tax purposes as a result
of such covenant defeasance and will be subject to Federal income tax on the
same amounts, in the same manner and at the same times as would have been the
case if such covenant defeasance had not occurred.
(7) The Issuer or the Partnership, as the case may be, shall have
delivered to the Trustee an Officers' Certificate stating that the deposit made
by the Issuer or the Partnership, as the case may be, pursuant to its election
under Section 4.2 or 4.3 was not made by the Issuer or the Partnership, as the
case may be, with the intent of preferring the Holders over the other creditors
of the Issuer or the Partnership with the intent of defeating, hindering,
delaying or defrauding creditors of the Issuer or the Partnership, as the case
may be, or others.
(8) The Issuer or the Partnership, as the case may be, shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent (other than conditions requiring the
passage of time) provided for relating to either the defeasance under Section
4.2 or the covenant defeasance under Section 4.3 (as the case may be) have been
complied with as contemplated by this Section 4.4. Opinions required to be
delivered under this Section may have qualifications customary for opinions of
the type required.
Section 4.5 Deposited Money and U.S. Government Obligations to be Held in
Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 10.3, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee (or other qualifying trustee--collectively for purposes of this
Section 4.5, the "Trustee") pursuant to Section 4.4 in respect of the Defeased
Senior Notes shall be held in trust and applied by the Trustee, in accordance
with the provisions of such Senior Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Issuer acting as its
own
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Paying Agent) as the Trustee may determine, to the Holders of such Defeased
Senior Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest, but such money need not be segregated from other
funds except to the extent required by law.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 4.4 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the Defeased Senior Notes.
Anything in this Article Four to the contrary notwithstanding, the Trustee
shall deliver or pay to the Issuer from time to time upon Issuer Request any
money or U.S. Government Obligations held by it as provided in Section 4.4
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent defeasance or covenant defeasance.
Section 4.6 Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 4.2 or 4.3, as the case may
be, by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Issuer's and the Partnership's obligations under this Indenture and the Senior
Notes shall be revived and reinstated as though no deposit had occurred pursuant
to Section 4.2 or 4.3, as the case may be, until such time as the Trustee or
Paying Agent is permitted to apply all such money or U.S. Government Obligations
in accordance with Section 4.2 or 4.3, as the case may be; provided, however,
that if the Issuer makes any payment of principal, premium, if any, or interest
on any Senior Note following the reinstatement of its obligations, the Issuer
shall be subrogated to the rights of the Holders of such Senior Notes to receive
such payment from the money held by the Trustee or Paying Agent.
ARTICLE 5
REMEDIES
Section 5.1 Events of Default.
"Event of Default", wherever used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
occasioned by the provisions of Article Twelve or be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or governmental
body):
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(a) default in the payment of any interest (including any Defaulted
Interest) on any of the Senior Notes when the same becomes due and payable and
the default continues for a period of 30 days;
(b) default in the payment of the principal of (or premium, if any, on)
any of the Senior Notes when the same becomes due and payable at its Stated
Maturity, upon acceleration, optional redemption, required repurchase, scheduled
principal payment or otherwise;
(c)(i) default in the performance, or breach, of any covenant of the
Issuer or the Partnership under the Senior Notes, the Senior Guarantee or this
Indenture (other than a default in the performance, or breach, of a covenant
that is specifically dealt with elsewhere in this Section 5.1) that continues
for 30 days after written notice has been given, by registered or certified
mail, (x) to the Issuer by the Trustee or (y) to the Issuer and the Trustee by
Holders of at least 25% of the aggregate principal amount of Outstanding Senior
Notes, specifying such default and requiring that it be remedied; (ii) default
in the performance or breach of the provisions of Article Eight hereof; (iii)
the Issuer or the Partnership shall have failed to make or consummate a Change
of Control Offer in accordance with Section 10.13 hereof; or (iv) the Issuer or
the Partnership shall have failed to make or consummate a required purchase of
the PIK Notes or Mortgage Notes in accordance with Section 10.9;
(d)(i) so long as there are only Registrable Series A Notes outstanding
hereunder, default by the Partnership, the Issuer or any of the Subsidiaries in
the payment, when due (whether at maturity, required prepayment, acceleration,
demand or otherwise) of any Indebtedness in an aggregate principal amount in
excess of $10,000,000 or any interest or premium thereon and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Indebtedness or any such Indebtedness shall be
declared to be due and payable or required to be prepaid (other than by a
regularly scheduled required prepayment) prior to the stated maturity thereof;
and (ii) on and after the date on which any of the events referred to in clauses
(A), (B) or (C) of the definition of Registrable Series A Notes has occurred,
the Partnership, the Issuer or any of the Subsidiaries shall fail to perform or
observe any term, covenant or agreement on its part to be performed or observed
under any agreement or instrument evidencing or securing or relating to any
Indebtedness in an aggregate principal amount in excess of $10,000,000 when
required to be performed or observed, if the effect of such failure is to
accelerate, or to permit the holder or holders of such Indebtedness to
accelerate, the maturity of such Indebtedness;
(e) one or more judgments, orders or decrees for the payment of money in
excess of $10,000,000, either individually or in the aggregate, shall be
rendered against the Issuer, the Partnership or any of the Subsidiaries or any
of their respective properties and shall not be discharged and either (i) an
enforcement proceeding shall have been commenced by any creditor upon such
judgment, order or decree or (ii) there shall be any period of 60 days, during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect;
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(f) an "Event of Default" under any Indebtedness secured by a Lien on any
of the property or assets of the Issuer or any of the Subsidiaries having a book
value in excess of $500,000, which Lien is senior to the Lien on such property
or assets which secures the Senior Notes;
(g) there shall have been the entry by a court having jurisdiction in the
premises of (i) a decree or order for relief in respect of the Issuer, the
Partnership or any of the Subsidiaries in an involuntary case or proceeding
under any applicable Bankruptcy Law or (ii) a decree or order adjudging the
Issuer, the Partnership or any of the Subsidiaries bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Issuer, the Partnership or any of the Subsidiaries under any applicable
federal or state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the Issuer, the Partnership
or any of the Subsidiaries or of any substantial part of its property, or
ordering the winding-up or liquidation of its affairs, and the continuance of
any such decree or order for relief or any such other decree or order unstayed
and in effect for a period of 60 consecutive days;
(h)(i) the Issuer, the Partnership or any of the Subsidiaries commences a
voluntary case or proceeding under any applicable Bankruptcy Law or any other
case or proceeding to be adjudicated bankrupt or insolvent, or (ii) the Issuer,
the Partnership or any of the Subsidiaries consents to the entry of a decree or
order for relief in respect of the Issuer or such Subsidiary in an involuntary
case or proceeding under any applicable Bankruptcy Law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or (iii) the Issuer,
the Partnership or any of the Subsidiaries files a petition or answer or consent
seeking reorganization or relief under any applicable federal or state law, or
the Issuer, the Partnership or any of the Subsidiaries consents to (1) the
filing of such petition or the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or similar
official of the Issuer, the Partnership or such Subsidiary or of any substantial
part of its property, (2) the making by it of an assignment for the benefit of
creditors or (3) the admission by it in writing of its inability to pay its
debts generally as they become due, or (iv) the taking of corporate or
partnership action by the Issuer, the Partnership or any of the Subsidiaries in
furtherance of any such action in this paragraph (i);
(i) the revocation, suspension or involuntary loss of any Permit which
results in the cessation of a substantial portion of the operations of the
Casino-Hotel for a period of more than 90 consecutive days;
(j) the Senior Guarantee, the TCHI Note Guarantee Mortgage, or the Senior
Partnership Upstream Note Mortgage shall for any reason cease to be in full
force and effect or enforceable in accordance with its terms;
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(k) an "Event of Default" under the Senior Partnership Upstream Note
Mortgage, Funding Note Indenture, Senior Note Mortgage Documents, the PIK Note
Indenture or the Mortgage Note Indenture, shall have occurred and is continuing;
(l) an entity, which at the time, directly or indirectly, holds general
partnership interests in both of Trump Plaza Associates and Trump Taj Mahal
Associates, which general partnership interests had previously been held by
Donald J. Trump and his Affiliates, sells through an initial public distribution
its equity securities without having first acquired all the direct and indirect
partnership interests in the Partnership held by Donald J. Trump as of the date
of this Indenture; and
(m) the Issuer ceases to be the general partner of the Partnership.
Section 5.2 Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(g) or (h)) occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in aggregate principal amount of the
Outstanding Senior Notes may, and the Trustee upon the request of the Holders of
not less than 25% in aggregate principal amount of the Outstanding Senior Notes
shall, declare the principal of all the Senior Notes to be due and payable
immediately in an amount equal to the principal amount of the Senior Notes,
together with accrued and unpaid interest to the date the Senior Notes become
due and payable, by a notice in writing to the Issuer (and to the Trustee, if
given by the Holders) unless on or prior to such amounts having become due and
payable the Issuer shall have discharged or paid in full the Indebtedness, if
any, that is the subject of such Event of Default and shall have given written
notice of such cure to the Trustee (which notice in the case of an Event of
Default specified in Section 5.1(d) shall be countersigned by the holders of the
Indebtedness that is the subject of such Event of Default or by a trustee,
fiduciary or agent for such Holders). If an Event of Default specified in
Section 5.1(g) or (h) occurs and is continuing, then the principal of all the
Senior Notes shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holder.
At any time after such declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the Holders of a majority
in aggregate principal amount of the Outstanding Senior Notes, by written notice
to the Issuer and the Trustee, may rescind and annul such declaration and its
consequences if:
(a) the Issuer has paid or deposited with the Trustee a sum sufficient to
pay
(i) all amounts due the Trustee under Section 6.6 and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel,
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(ii) all overdue interest on all such Senior Notes,
(iii) the principal of and premium, if any, on any Senior Notes which have
become due otherwise than by such declaration of acceleration and interest
thereon at the rate borne by the Senior Notes, and
(iv) to the extent that payment of such interest is lawful, interest upon
overdue interest at the rate borne by such Senior Notes; and
(b) all Events of Default, other than the non-payment of principal of
Senior Notes which have become due solely by such declaration of acceleration,
have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon as provided in Section 5.13.
Section 5.3 Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Issuer and the Partnership covenants that if
(a) default is made in the payment of any interest on any Senior Note when
such interest becomes due and payable and such default continues for a period of
30 days, or
(b) default is made in the payment of the principal of or premium, if any,
on any Senior Note at the Stated Maturity thereof,
the Issuer and the Partnership will, upon demand of the Trustee, pay to it, for
the benefit of the Holders of such Senior Notes, the whole amount then due and
payable on such Senior Notes for principal and premium, if any, and interest,
with interest upon the overdue principal and premium, if any, and, to the extent
that payment of such interest shall be legally enforceable, upon overdue
installments of interest, at the rate borne by the Senior Notes; and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Issuer or the Partnership, as the case may be, fails to pay such
amounts forthwith upon such demand, the Trustee, in its own name and as trustee
of an express trust, may institute a judicial proceeding for the collection of
the sums so due and unpaid and may prosecute such proceeding to judgment or
final decree, and may enforce the same against the Issuer, the Partnership or
any other obligor upon the Senior Notes and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of the property of the
Issuer, the Partnership or any other obligor upon the Senior Notes, wherever
situated.
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If an Event of Default occurs and is continuing, the Trustee may in its
discretion (i) proceed to protect and enforce its rights and the rights of the
Holders under this Indenture, the Senior Guarantee or the Senior Partnership
Upstream Note Mortgage (subject to the terms thereof) by such appropriate
private or judicial proceedings as the Trustee shall deem most effectual to
protect and enforce such rights, including, without limitation, any rights or
powers conferred on the Trustee pursuant to the Senior Partnership Upstream Note
Mortgage and seeking recourse against the Partnership pursuant to the terms of
the Senior Guarantee, or (ii) to proceed to protect and enforce the rights of
the Trustee and the Holders of Senior Notes under the Senior Partnership
Upstream Note Mortgage by such appropriate private or judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in the Senior
Partnership Upstream Note Mortgage or in aid of the exercise of any power
granted therein, or to enforce any other proper remedy, including, without
limitation, seeking recourse against the Partnership pursuant to the terms of
the Senior Guarantee, appointment of a receiver for the Collateral and
foreclosure, realization and sale of the Collateral pursuant to the terms of the
Senior Partnership Upstream Note Mortgage. The Trustee shall be entitled to sue
and recover judgment as aforesaid or to sue to enforce any Lien under the Senior
Partnership Upstream Note Mortgage, in either case, either before, after or
during the pendency of any other proceeding for the enforcement of any Lien
under the Senior Partnership Upstream Note Mortgage, and the right of the
Trustee to recover such judgment shall not be affected by any sale under the
Senior Partnership Upstream Note Mortgage or by the exercise of any right, power
or remedy for the enforcement of the provisions of the Senior Partnership
Upstream Note Mortgage, or the foreclosure or enforcement of any Lien of the
Senior Partnership Upstream Note Mortgage. No recovery of any such judgment upon
any property of the Issuer or the Partnership shall affect or impair the Lien on
the Collateral or any rights, powers or remedies of the Trustee or the Holders.
Section 5.4 Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Issuer, the Partnership or any other obligor
upon the Senior Notes or the property of the Issuer, the Partnership or such
other obligor, the Trustee (irrespective of whether the principal of the Senior
Notes shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Issuer for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of principal, and
premium, if any, and interest owing and unpaid in respect of the Senior Notes
and to file such other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the Holders allowed in such judicial proceeding; and
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(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.6.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Senior
Notes or the rights of any Holder thereof, or to authorize the Trustee to vote
in respect of the claim of any Holder in any such proceeding.
Section 5.5 Trustee May Enforce Claims Without Possession of the Senior
Notes.
All rights of action and claims under this Indenture or the Senior Notes
may be prosecuted and enforced by the Trustee without the possession of any of
the Senior Notes or the production thereof in any proceeding relating thereto,
and any such proceeding instituted by the Trustee shall be brought in its own
name and as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Senior Notes in respect of which such
judgment has been recovered.
Section 5.6 Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied, subject to applicable law, in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such money on account
of principal, premium, if any, or interest, upon presentation of the Senior
Notes and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 6.6;
SECOND: To the payment of the amounts then due and unpaid upon the Senior
Notes for principal, premium, if any, and interest, in respect of which or for
the benefit of which such money has been collected, ratably, without preference
or priority of any kind, according to the amounts due and payable on such Senior
Notes for principal, premium, if any, and interest;
THIRD: The balance, if any, to the Person or Persons entitled thereto,
including the Issuer.
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Section 5.7 Limitation on Suits.
No Holder of any Senior Notes shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(a) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;
(b) the Holders of not less than 25% in principal amount of the
Outstanding Senior Notes shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Senior Notes;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture or the Senior Partnership Upstream Note Mortgage or the Senior
Guarantee to affect, disturb or prejudice the rights of any other Holders, or to
obtain or to seek to obtain priority or preference over any other Holders or to
enforce any right under this Indenture, except in the manner provided in this
Indenture, the Senior Guarantee or the Senior Partnership Upstream Note Mortgage
and for the equal and ratable benefit of all of the Holders.
Section 5.8 Unconditional Right of Holders to Receive Principal, Premium
and Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Senior Note shall have the right on the terms stated herein, which is absolute
and unconditional, to receive payment of the principal of, premium, if any, and
(subject to Sections 3.1 and 3.7) interest on such Senior Note on the respective
Stated Maturities expressed in such Senior Note (or, in the case of redemption,
on the Redemption Date) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.
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Section 5.9 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture, the Senior Guarantee or the Senior
Partnership Upstream Note Mortgage and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case the Issuer, the Partnership, any other
obligor under the Senior Notes, the Trustee and the Holders shall, subject to
any determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
Section 5.10 Rights and Remedies Cumulative.
Except as provided in Section 3.6, no right or remedy herein conferred
upon or reserved to the Trustee or to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 5.11 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Senior Note to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section 5.12 Control by Holders.
The Holders of a majority in principal amount of the outstanding Senior
Notes shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee hereunder or under the Senior Partnership
Upstream Note Mortgage, provided that
(a) such direction shall not be in conflict with any rule of law or with
this Indenture, the Senior Guarantee Mortgage or the Senior Partnership Upstream
Note Mortgage or expose the Trustee to personal liability; and
(b) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
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Section 5.13 Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Senior Notes may on behalf of the Holders of all the Senior Notes
waive any past Default hereunder and its consequences, except a Default:
(a) in the payment of the principal of, premium, if any, or interest on
any Senior Note, or
(b) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Senior Note affected.
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 5.14 Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Senior Note by
his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture or the TCHI Note Mortgage Documents, or in any suit against the
Trustee for any action taken, suffered or omitted by it as Trustee, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Holder, or group
of Holders, holding in the aggregate more than 10% in principal amount of the
Outstanding Senior Notes, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of, premium, if any, or interest on
any Senior Note on or after the respective Stated Maturities expressed in such
Senior Note (or, in the case of redemption, on or after the Redemption Date).
Section 5.15 Waiver of Stay, Extension or Usury Laws.
Each of the Issuer, the Partnership and any other obligor under the Senior
Notes covenants (to the extent that it may lawfully do so) that it will not at
any time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other law
wherever enacted, now or at any time hereafter in force, which would prohibit or
forgive the Issuer, the Partnership or any such obligor from paying all or any
portion of the principal of, premium, if any, or interest on the Senior Notes
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contemplated herein or in the Senior Notes or which may affect the covenants or
the performance of this Indenture; and each of the Issuer, the Partnership and
any such obligor (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
Section 5.16 Unconditional Right of Holders to Institute Certain Suits.
Notwithstanding any other provision in this Indenture and any other
provision of any Senior Note, the right of any Holder of any Senior Note to
receive payment of the principal of, premium, if any, and interest on such
Senior Note on or after the respective due dates expressed in such Senior Note,
or to institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
Section 5.17 Management of Casino-Hotel.
Notwithstanding any provision of this Article Five to the contrary,
(a) following an Event of Default under the Senior Partnership Upstream
Note Mortgage and the exercise by the Trustee of any of its rights under Section
3.9 thereof or other taking of possession of the Collateral by the Trustee, the
Trustee shall be authorized, in addition to the rights and powers of the Trustee
set forth elsewhere in this Indenture and the Senior Partnership Upstream Note
Mortgage, to retain one or more experienced operators of hotels and/or casinos
to manage the Casino-Hotel on behalf of the Holders, provided that any such
operator shall have all necessary legal qualifications, including all Permits,
to manage the Casino-Hotel; and
(b) no Holder shall have any right to take possession of, operate or
manage all or any portion of, the Casino-Hotel, individually or as a member of a
group, unless such Holder shall have all necessary legal qualifications,
including all Permits, to do so and shall otherwise be qualified to be retained
to manage the Casino-Hotel under Subsection (a) of this Section 5.17.
ARTICLE 6
THE TRUSTEE
Section 6.1 Duties of Trustee and Notice of Defaults.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, the Senior Partnership Upstream
Note Mortgage
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and the TCHI Note Guarantee Mortgage, and no implied covenants or obligations
shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements to this Indenture or
the Senior Partnership Upstream Note Mortgage or the TCHI Note Guarantee
Mortgage; but in the case of any such certificates or opinions which by any
provision hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or not
they conform to the requirements of this Indenture, the Senior Partnership
Upstream Note Mortgage and the TCHI Note Guarantee Mortgage.
(b) In case of an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this Subsection (c) shall not be construed to limit the effect of
Subsection (a) of this Section 6.1;
(2) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
Holders of a majority in aggregate principal amount of the Outstanding Senior
Notes relating to the time, method and place of conducting any proceeding for
any remedy available to Trustee, or exercising any trust or power conferred upon
the Trustee, under this Indenture; and
(4) no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.
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(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section
6.1.
(e) Within 30 days after the occurrence of any Default, the Trustee shall
transmit by mail to all Holders, as their names and addresses appear in the
Senior Note Register, notice of such Default hereunder known to the Trustee,
unless such Default shall have been cured or waived; provided, however, that,
except in the case of a Default in the payment of the principal of, premium, if
any, or interest on any Senior Note, the Trustee shall be protected in
withholding such notice if and so long as a trust committee of Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interest of the Holders; and provided, further, that in the
case of any Default of the character specified in Section 5.1(c) no such notice
to Holders shall be given until at least 15 days after the occurrence thereof.
The Trustee shall not be deemed to have knowledge of any Default (other than a
Default under Section 5.1(a) or (b) hereunder) unless and until the Trustee
shall have received notice of such Default or obtained actual knowledge thereof.
Section 6.2 Certain Rights of Trustee.
Subject to the provisions of Section 315 of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) any request or direction of the Issuer mentioned herein shall be
sufficiently evidenced by an Issuer Request or Issuer Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) the Trustee may consult with counsel and any advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred therein or thereby in compliance with such
request or direction;
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(e) the Trustee shall not be liable for any action taken or omitted by it
in good faith and believed by it to be authorized or within the discretion,
rights or powers conferred upon it by this Indenture other than any liabilities
arising out of the negligence of the Trustee;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, approval,
appraisal, bond, debenture, note, coupon, security or other paper or document
unless requested in writing so to do by the Holders of not less than a majority
in aggregate principal amount of the Senior Notes then Outstanding; provided
that, if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such expenses or liabilities as
a condition to proceeding; the reasonable expenses of every such investigation
shall be paid by the Partnership or, if paid by the Trustee or any predecessor
Trustee, shall be repaid by the Partnership upon demand; provided, further, the
Trustee in its discretion may make such further inquiry or investigation into
such facts or matters as it may deem fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Partnership, personally or by agent or
attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(h) no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers;
(i) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(j) in addition to and not in limitation of its other powers hereunder,
the Trustee shall have such power and authority as may be necessary to enter
into and accept delivery of any document as may be necessary to effect on behalf
of the Holders of the Senior Notes (1) the pari passu nature of the indebtedness
and Liens in respect of the Senior Notes to (A) any other portion of the Working
Capital Facility and the Liens securing the same and (B) the Funding Notes and
the Liens securing the same, and (2) the priority of the indebtedness and Liens
in respect of the Senior Notes to (A) the indebtedness and Liens in respect of
the Mortgage Notes and (B) the indebtedness and Liens in respect of the PIK
Notes, and upon written request of the Issuer or the Partnership, the Trustee
shall enter into such agreements on behalf of the Holders.
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Section 6.3 Trustee Not Responsible for Recitals, Dispositions of Senior
Notes or Application of Proceeds Thereof; etc.
The recitals contained herein and in the Senior Notes, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Issuer, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Senior Notes, except that the Trustee represents that it is
duly authorized to execute and deliver this Indenture, authenticate the Senior
Notes and perform its obligations hereunder and that the statements made by it
in a Statement of Eligibility and Qualification on Form T-1 to be supplied to
the Issuer will be true and accurate subject to the qualifications set forth
therein. The Trustee shall not be accountable for the use or application by the
Issuer of Senior Notes or the proceeds thereof. The Trustee shall not be deemed
to have knowledge of any Event of Default (other than an Event of Default under
Section 5.1(a) or (b) hereunder) unless and until the Trustee shall have
received notice of such Event of Default or obtained actual knowledge thereof.
The Trustee's receipt of reports and documents pursuant to Section 7.4 and
Section 10.18 hereof shall not constitute constructive knowledge of any
information contained therein or determinable from information contained
therein, including compliance with the covenants set forth in Article 10 hereof.
Except as expressly provided in this Indenture and except with respect to
Section 10.1 hereof, the Trustee shall not have an affirmative duty to inquire
as to the compliance with the covenants set forth in Article 10 hereof.
Section 6.4 Trustee and Agents May Hold Senior Notes; Collections; Etc.
The Trustee, any Paying Agent, Senior Note Registrar or any other agent of
the Issuer, in its individual or any other capacity, may become the owner or
pledgee of Senior Notes, with the same rights it would have if it were not the
Trustee, Paying Agent, Senior Note Registrar or such other agent and, subject to
Sections 310 and 311 of the Trust Indenture Act, may otherwise deal with the
Issuer and receive, collect, hold and retain collections from the Issuer with
the same rights it would have if it were not the Trustee, Paying Agent, Senior
Note Registrar or such other agent.
Section 6.5 Money Held in Trust.
All moneys received by the Trustee shall, until used or applied as herein
provided, be held in trust for the purposes for which they were received, but
need not be segregated from other funds except to the extent required by
mandatory provisions of law. Neither the Trustee nor any agent of the Issuer or
the Trustee shall be under any liability for interest on any moneys received by
it hereunder.
Section 6.6 Compensation and Indemnification of Trustee and Its Prior
Claim.
The Issuer and the Partnership covenant and agree to pay to the Trustee
from time to time, and the Trustee shall be entitled to, reasonable compensation
for all services rendered by it
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hereunder (which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) and the Partnership covenants and
agrees to pay or reimburse the Trustee and each predecessor Trustee upon its
request for all reasonable expenses, disbursements and advances incurred or made
by or on behalf of it in accordance with any of the provisions of this Indenture
(including the reasonable compensation and the expenses and disbursements of its
counsel and of all agents and other persons not regularly in its employ), except
any such expense, disbursement or advance as may arise from such Trustee's
negligence or bad faith. The Issuer and the Partnership also covenant to
indemnify the Trustee and each predecessor Trustee for, and to hold it harmless
against, any loss, liability, tax, assessment or other governmental charge
(other than taxes applicable to the Trustee's compensation hereunder) or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this Indenture or the trusts
hereunder and its duties hereunder including enforcement of this Section 6.6 and
also including any liability which the Trustee may incur as a result of failure
to withhold, pay or report any tax, assessment or other governmental charge, and
the costs and expenses of defending itself against or investigating any claim of
liability in the premises. The obligations of the Issuer and the Partnership
under this Section to compensate and indemnify the Trustee and each predecessor
Trustee and to pay or reimburse the Trustee and each predecessor Trustee for
expenses, disbursements and advances shall constitute an additional obligation
hereunder and shall survive the satisfaction and discharge of this Indenture.
To secure the Issuer's and the Partnership's payment obligations in this
Section 6.6, the Trustee shall have a Lien prior to the Senior Notes on all
money and property held or collected by the Trustee or any receiver Trustee,
assignee, liquidator, sequestrator, custodian or similar officer in Trustee's
stead except such money or property held in trust to pay principal of (or
premium, if any) and interest on particular Senior Notes. Such Lien shall
survive satisfaction and discharge of this Indenture, and will be an additional
obligation of the Partnership hereunder.
Section 6.7 Conflicting Interests.
(a) If the Trustee has or acquires any conflicting interest, as defined in
Section 310(b) of the Trust Indenture Act, it shall, within ninety days after
ascertaining that it has such conflicting interest, either eliminate such
conflicting interest or resign in the manner and with the effect set forth in
Section 6.9(b).
(b) In the event that the Trustee shall fail to comply with the provisions
of the preceding subsection (a) of this Section, the Trustee shall, within ten
days after the expiration of such ninety day period, transmit notice of such
failure to the Holders, in the manner and to the extent provided in Section 7.3
with respect to reports.
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Section 6.8 Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or of any state or territory or District of Columbia, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $100,000,000, subject to supervision or examination by
federal, state, territorial or District of Columbia supervising or examining
authority, and having a Corporate Trust Office in The City of New York to the
extent there is such an institution eligible and willing to serve. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of such supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.
Section 6.9 Resignation and Removal; Appointment of Successor Trustee.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.10.
(b) The Trustee, or any trustee or trustees hereafter appointed, may at
any time resign by giving written notice thereof to the Issuer. Upon receiving
such notice of resignation, the Issuer shall promptly appoint a successor
trustee by written instrument executed by authority of the Board of Directors of
the Issuer, a copy of which shall be delivered to the resigning Trustee and a
copy to the successor trustee. If an instrument of acceptance by a successor
Trustee shall not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may, or any Holder
who has been a bona fide Holder of a Senior Note for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee. Such court
may thereupon, after such notice, if any, as it may deem proper, appoint a
successor trustee.
(c) The Trustee may be removed at any time by an Act of the Holders of a
majority in principal amount of the then Outstanding Senior Notes, delivered to
the Trustee and to the Issuer.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of Section 6.7
after written request therefor by the Issuer or by any Holder who has been a
bona fide Holder of a Senior Note for at least six months, or
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(2) the Trustee shall cease to be eligible under Section 6.8 hereof and
shall fail to resign after written request therefor by the Issuer or by any such
Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent, or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation, or
(4) the CCC determines that the Trustee is required to be licensed or
found qualified or suitable and the Trustee does not become so licensed or found
qualified or suitable within such period as may be prescribed by the CCC,
then, in any such case, (i) the Issuer by a Board Resolution may remove the
Trustee, or (ii) subject to Section 5.14 hereof, the Holder of any Senior Note
who has been a bona fide Holder of a Senior Note for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, remove the Trustee and appoint a successor
trustee.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Issuer,
by a Board Resolution, shall promptly, upon approval of the CCC, appoint a
successor Trustee which Trustee shall be licensed or found qualified or suitable
under the New Jersey Casino Control Act. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Senior Notes delivered to the Issuer, upon
approval by the CCC and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment, become the successor
Trustee and supersede the successor Trustee appointed by the Issuer. If no
successor Trustee shall have been so appointed by the Issuer or the Holders of
the Senior Notes and accepted appointment in the manner hereinafter provided,
the Holder of any Senior Note who has been a bona fide Holder for at least six
months may, subject to Section 5.14 hereof, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(f) The Issuer shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee by mailing written
notice of such event by first-class mail, postage prepaid, to the Holders of
Senior Notes as their names and addresses appear in the Senior Note Register.
Each notice shall include the name of the successor Trustee and the address of
its Corporate Trust Office.
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Section 6.10 Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Issuer and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee as if originally named as Trustee hereunder; but,
nevertheless, on the written request of the Issuer or the successor Trustee,
upon payment of its charges then unpaid, such retiring Trustee shall pay over to
the successor Trustee all moneys at the time held by it hereunder and shall
execute and deliver an instrument transferring to such successor Trustee all
such rights, powers, duties and obligations.
Upon request of any such successor Trustee, the Issuer shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights and powers. Any Trustee ceasing to act
shall, nevertheless, retain a prior claim upon all property or funds held or
collected by such Trustee to secure any amounts then due it pursuant to the
provisions of Section 6.6.
No successor Trustee with respect to the Senior Notes shall accept
appointment as provided in this Section 6.10 unless at the time of such
acceptance such successor Trustee shall be eligible to act as Trustee under the
provisions of Section 310(a) of the Trust Indenture Act and shall have a
combined capital and surplus of at least $100,000,000 and have a Corporate Trust
Office in The City of New York.
Upon acceptance of appointment by any successor Trustee as provided in
this Section 6.10, the Issuer shall give notice thereof to the Holders of the
Senior Notes, by mailing such notice to such Holders at their addresses as they
shall appear on the Senior Note Register. If the acceptance of appointment is
substantially contemporaneous with the resignation, then the notice called for
by the preceding sentence may be combined with the notice called for by Section
6.9. If the Issuer fails to give such notice within 10 days after acceptance of
appointment by the successor Trustee, the successor Trustee shall cause such
notice to be given at the expense of the Issuer.
Section 6.11 Merger, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be eligible under Section 310(a) of the Trust
Indenture Act and shall have a combined capital and surplus of at least
$100,000,000 and have a Corporate Trust Office in the City of New York, without
the execution or filing of any paper or any further act on the part of any of
the parties hereto.
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In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Senior Notes shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such Senior
Notes so authenticated; and, in case at that time any of the Senior Notes shall
not have been authenticated, any successor to the Trustee may authenticate such
Senior Notes either in the name of any predecessor hereunder or in the name of
the successor Trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Senior Notes or in this Indenture
provided that the certificate of the Trustee shall have; provided that the right
to adopt the certificate of authentication of any predecessor Trustee or to
authenticate Senior Notes in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or consolidation.
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND ISSUER
Section 7.1 Issuer to Furnish Trustee Names and Addresses of Holders.
The Issuer will furnish or cause to be furnished to the Trustee:
(a) semiannually, not more than 10 days after each Regular Record Date, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders as of such Regular Record Date; and
(b) at such other times as the Trustee may request in writing, within 30
days after receipt by the Issuer of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished;
provided, however, that if and so long as the Trustee shall be the Senior Note
Registrar, no such list need be furnished pursuant to clause (a) or (b) of this
Section 7.1.
Section 7.2 Disclosure of Names and Addresses of Holders.
Every Holder of Senior Notes, by receiving and holding the same, agrees
with the Issuer and the Trustee that neither the Issuer nor the Trustee shall be
held accountable by reason of the disclosure of any information as to the names
and addresses of the Holders in accordance with the New Jersey Casino Control
Act or Section 312 of the Trust Indenture Act, regardless of the source from
which such information was derived, and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 312 of the Trust Indenture Act.
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Section 7.3 Reports by Trustee.
(a) Within 60 days after May 15 of each year commencing with May 15, 1998,
the Trustee shall transmit by mail to all Holders, as their names and addresses
appear in the Senior Note Register, as provided in Section 313(c) of the Trust
Indenture Act, a brief report dated as of such May 15 in accordance with and to
the extent required by Section 313(a) of the Trust Indenture Act.
(b) The Trustee will provide the CCC and the Director of the NJDGE with:
(1) copies of all notices, reports and other written communications which
the Trustee gives to Holders;
(2) a list of Holders promptly after the original issuance of the Senior
Notes and a list of Holders eight months and two months prior to the expiration
date of each then-current gaming Permit held by the Partnership;
(3) notice of any Event of Default under this Indenture or of any event,
occurrence or condition which, with the giving of notice or lapse of time or
both would constitute an Event of Default, any acceleration of the Indebtedness
evidenced or secured hereby, the institution of any legal actions or proceedings
before any court or governmental authority in respect of this Indenture or the
Senior Partnership Upstream Note Mortgage, the entering into or taking
possession of any property constituting the Collateral and any rescission,
annulment or waiver in respect of an Event of Default;
(4) notice of the removal or resignation of the Trustee within five
Business Days thereof;
(5) notice of any transfer or assignment of rights under this Indenture
(but not in respect of the Senior Notes) or the Senior Partnership Upstream Note
Mortgage within five Business Days thereof; and
(6) a copy of any amendment to the Senior Notes, this Indenture (including
the Senior Guarantee) or the Senior Partnership Upstream Note Mortgage within
five Business Days of the effectiveness thereof.
The notice specified in clause (3) above shall be in writing and, except as set
forth below, shall be given within five Business Days after the Trustee has
transmitted the notice required by Section 6.1. In the case of any notice in
respect of any Event of Default, such notice shall be accompanied by a copy of
any notice from the Holders, or a representative thereof or the Trustee, to the
defaulting Person and, if accompanied by any such notice to the defaulting
Person, shall be given simultaneously with the giving of any such notice to the
defaulting
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Person. In the case of any legal actions or proceedings, such notice shall be
accompanied by a copy of the complaint or other initial pleading or document.
The Trustee shall in accordance with the limitations set forth herein
cooperate with the CCC and the Director of NJDGE in order to provide the CCC and
said Director with information and documentation relevant to compliance with
clause (3) above and as otherwise required by the New Jersey Casino Control Act.
The Partnership will advise the Trustee of the expiration date of the
then-current gaming Permit held by the Partnership at least 90 days prior to the
expiration thereof and the Trustee until so advised may assume that such Permit
has not expired.
Section 7.4 Reports by the Issuer and the Partnership.
The Issuer and the Partnership shall:
(a) file with the Trustee, in accordance with Section 10.18 hereof within
15 days after the Issuer or the Partnership, as the case may be, is required to
file the same with the SEC, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may from time to time by rules and regulations prescribe) which the
Issuer or the Partnership, as the case may be, may be required to file with the
SEC pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the
Issuer or the Partnership, as the case may be, is not required to file
information, documents or reports pursuant to either of said Sections, then it
shall file with the Trustee and the SEC, in accordance with rules and
regulations prescribed from time to time by the SEC, such of the supplementary
and periodic information, documents and reports which may be required pursuant
to Section 13 of the Exchange Act in respect of a security listed and registered
on a national securities exchange as may be prescribed from time to time in such
rules and regulations;
(b) file with the Trustee and the SEC, in accordance with the rules and
regulations prescribed from time to time by the SEC, such additional
information, documents and reports with respect to compliance by the Issuer or
the Partnership, as the case may be, with the conditions and covenants of this
Indenture as may be required from time to time by such rules and regulations;
and
(c) transmit by mail to all Holders, as their names and addresses appear
in the Senior Note Register, within 30 days after the filing thereof with the
Trustee, in the manner and to the extent provided in Section 313(c) of the Trust
Indenture Act, such summaries of any information, documents and reports required
to be filed by the Issuer pursuant to Subsections (a) and (b) of this Section as
may be required by rules and regulations prescribed from time to time by the
SEC.
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ARTICLE 8
CONSOLIDATION, MERGER,
CONVEYANCE, TRANSFER OR LEASE
Section 8.1 The Issuer or the Partnership May Consolidate, Merge, etc.,
Only on Certain Terms.
(a) The Partnership shall not consolidate with, merge with or into any
other Person or sell, assign, convey, transfer, lease or otherwise dispose of
all or substantially all of its properties and assets (as an entirety or
substantially as an entirety in one transaction or series of related
transactions) to any other Person or group of affiliated Persons or permit any
of the Subsidiaries to enter into any such transaction or transactions if such
transaction or transactions, in the aggregate, would result in a transfer of all
or substantially all of the assets of the Partnership and the Subsidiaries on a
consolidated basis to any other Person or group of affiliated Persons, unless:
(i) either (a) the Partnership shall be the continuing Person, or (b) the
Person (if other than the Partnership) formed by such consolidation or into
which the Partnership is merged or the Person which acquires by conveyance,
transfer, lease or disposition the properties and assets of the Partnership (the
"Surviving Entity") shall be a corporation or partnership duly organized and
validly existing under the laws of the United States of America, any state
thereof or the District of Columbia and shall, in either case, expressly assume,
by an indenture supplemental to this Indenture, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the Senior Guarantee and the
performance and observance of every covenant of this Indenture and the Senior
Partnership Upstream Note Mortgage on the part of the Partnership to be
performed or observed and this Indenture and the Senior Partnership Upstream
Note Mortgage shall remain in full force and effect;
(ii) immediately after giving effect to such transaction on a pro forma
basis (and treating any Indebtedness not previously an obligation of the
Partnership or a Subsidiary which becomes the obligation of the Partnership or
any of its Subsidiaries in connection with or as a result of such transaction as
having been incurred at the time of such transaction), the Consolidated Net
Worth of the Partnership (or the Surviving Entity if the Partnership is not the
continuing obligor under this Indenture) is at least equal to the Consolidated
Net Worth of the Partnership immediately prior to such transaction or series of
transactions;
(iii) immediately before and immediately after giving effect to such
transaction on a pro forma basis (and treating any Indebtedness not previously
an obligation of the Partnership or a Subsidiary which becomes the obligation of
the Partnership or any of its Subsidiaries in connection with or as a result of
such transaction as having been incurred
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at the time of such transaction), (A) no Default or Event of Default, shall have
occurred and be continuing and (B) the Partnership (or the Surviving Entity if
the Partnership is not the continuing obligor under this Indenture) after giving
effect to such transaction, could incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness), under the provisions of Section 10.7;
(iv) immediately after such transaction, the Partnership or the Surviving
Entity holds all Permits required for operation of the business of, and such
entity is controlled by a Person or entity (or has retained a Person or entity
which is) experienced in, operating casino hotels or otherwise holds all Permits
(including from the CCC) to operate its business; and
(v) in connection with any consolidation, merger, transfer or lease
contemplated hereby, the Partnership shall deliver, or cause to be delivered, to
the Trustee, in the form and substance reasonably satisfactory to the Trustee,
an Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, transfer or lease and the supplemental indenture in
respect thereto comply with the provisions described herein and that (A) all
conditions precedent herein provided for relating to such transaction have been
complied with and (B) the transaction shall not impair the Lien of the Senior
Partnership Upstream Note Mortgage, this Indenture and the Senior Notes and the
rights and powers of the Trustee and Holders thereunder.
(b) The Issuer shall not consolidate with or merge with or into any other
Person or sell, assign, convey, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets (as an entirety in one
transaction or series of related transactions) to any other Person or group of
affiliated Persons unless:
(i) either (1) the Issuer shall be the continuing corporation or (2) the
Person (if other than the Issuer) formed by such consolidation, or into which
the Issuer is merged or the Person which acquires by sale, assignment,
conveyance, transfer, lease or disposition the properties and assets of the
Issuer (the "Surviving Entity") shall be a corporation, partnership or trust
organized and validly existing under the laws of the United States of America,
any state thereof or the District of Columbia and shall, in either case,
expressly assume by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, all the obligations of the
Issuer under the Senior Notes, this Indenture and the Senior Partnership
Upstream Note Mortgage;
(ii) immediately before and immediately after giving effect to such
transaction on a pro forma basis, no Default or Event of Default shall have
occurred and be continuing;
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(iii) the Partnership shall have by supplemental indenture confirmed that
its obligations under the Senior Guarantee and the Senior Partnership Upstream
Note Mortgage shall apply to such Person's obligations under this Indenture and
the Senior Notes;
(iv) immediately after giving effect to such transaction on a pro forma
basis (and treating any Indebtedness not previously an obligation of the
Partnership or a Subsidiary which becomes the obligation of the Partnership or
any Subsidiary in connection with or as a result of such transaction as having
been incurred at the time or such transaction), the Consolidated Net Worth of
the Issuer (or the Surviving Entity if the Issuer is not the continuing obligor
under this Indenture) is at least equal to the Consolidated Net Worth of the
Issuer immediately prior to such transaction or series of transactions;
(v) immediately before and immediately after giving effect to such
transaction on a pro forma basis (and treating any Indebtedness not previously
an obligation of the Partnership or a Subsidiary which becomes the obligation of
the Partnership or any of its Subsidiaries in connection with or as a result of
such transaction as having been incurred at the time of such transaction), the
Partnership or its successor, after giving effect to such transaction, could
incur at least $1.00 of additional Indebtedness (other than Permitted
Indebtedness), under the provisions of Section 10.7;
(vi) immediately after such transaction, the Issuer or the Surviving
Entity holds all Permits required for the operation of the business of the
Issuer and immediately after such transaction, the Partnership or its successor
holds all permits required for operation of the business of, and such entity is
controlled by a Person or entity (or has retained a Person or entity which is)
experienced in, operating casino hotels or otherwise holds all Permits
(including from the CCC) to operate its business; and
(vii) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, sale, assignment, conveyance, transfer, lease or disposition and such
supplemental indenture comply with this Indenture, and that (A) all conditions
precedent herein relating to such transaction have been complied with and (B)
the transaction shall not impair the lien and security of the Senior Partnership
Upstream Note Mortgage, this Indenture and the Senior Notes and the rights and
powers of the Trustee and Holders thereunder.
Section 8.2 Successor Substituted.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer or disposition of all or substantially all of the properties and assets
of the Issuer or the Partnership in accordance with Section 8.1 (other than a
lease), the successor Person formed by such consolidation or into which the
Issuer or the Partnership, as the case may be, is merged or the
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successor Person to which such sale, assignment, conveyance, transfer or
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Issuer or the Partnership, as the case may be,
under this Indenture and/or the Senior Guarantee, as the case may be, and the
Senior Partnership Upstream Note Mortgage with the same effect as if such
successor had been named as the Issuer or the Partnership, as the case may be,
herein and/or the Senior Guarantee, as the case may be; and thereafter, except
in the case of a lease, the Issuer or the Partnership, as the case may be, shall
be discharged from all obligations and covenants under this Indenture, the
Senior Notes and the TCHI Note Mortgage Documents, as the case may be.
ARTICLE 9
SUPPLEMENTAL INDENTURES
Section 9.1 Supplemental Indentures and Agreements without Consent of
Holders.
Without the consent of any Holders, the Issuer and the Partnership when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto or agreements or
other instruments with respect to any Collateral, the Senior Guarantee, the TCHI
Note Guarantee Mortgage, or the Senior Partnership Upstream Note Mortgage, in
form and substance satisfactory to the Trustee, for any of the following
purposes:
(a) to evidence the succession of another Person to the Issuer or the
Partnership and the assumption by any such successor of the covenants of the
Issuer or the Partnership herein and in the Senior Notes, in the Senior
Guarantee, the TCHI Note Guarantee Mortgage, and in the Senior Partnership
Upstream Note Mortgage;
(b) to add to the covenants of the Issuer or the Partnership for the
benefit of the Holders, or to surrender any right or power herein conferred upon
the Issuer or the Partnership, as applicable, herein or in the Senior
Partnership Upstream Note Mortgage or the Senior Guarantee;
(c) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, the TCHI
Note Mortgage Documents or the Senior Guarantee, or to clarify any other
provisions with respect to matters or questions arising under this Indenture,
the TCHI Note Mortgage Documents or the Senior Guarantee; provided that, in each
case, such provisions shall not adversely affect the interests of the Holders;
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(d) to comply with the requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act, as
contemplated by Section 9.5 or otherwise;
(e) to add a guarantor of the Indenture Obligations;
(f) to evidence and provide the acceptance of the appointment of a
successor Trustee hereunder;
(g) to mortgage, pledge, hypothecate or grant a security interest in favor
of the Trustee for the benefit of the Holders as additional security for the
payment and performance of the Indenture Obligations, in any property or assets,
including any which are required to be mortgaged, pledged or hypothecated, or in
which a security interest is required to be granted to the Trustee pursuant to
this Indenture or the Senior Partnership Upstream Note Mortgage or otherwise; or
(h) to enter into the agreements described in Section 6.2(j) hereof.
The terms of any document entered into pursuant to this Section shall be
subject to prior approval, if required, of the CCC and the NJDGE.
Section 9.2 Supplemental Indentures and Agreements with Consent of
Holders.
With the consent of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Senior Notes, by Act of said Holders
delivered to the Issuer, the Partnership and the Trustee, the Issuer and the
Partnership when authorized by Board Resolutions, and the Trustee may enter into
an indenture or indentures supplemental hereto or agreements or other
instruments with respect to the Collateral, the Senior Partnership Upstream Note
Mortgage or the Senior Guarantee in form and substance satisfactory to the
Trustee for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders under this Indenture, the Senior Notes, the
Senior Guarantee, the TCHI Note Guarantee Mortgage, or the Senior Partnership
Upstream Note Mortgage; provided, however, that no such supplemental indenture,
agreement or instrument shall, without the consent of the Holder of each
Outstanding Senior Note affected thereby:
(a) change the Stated Maturity of the principal of, or any installment of
interest on, any Senior Note or reduce the principal amount thereof or the rate
of interest thereon or any premium payable upon the redemption thereof, or
change the coin or currency in which any Senior Note or any premium or the
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment after the Stated Maturity thereof (or, in the
case of redemption, on or after the Redemption Date);
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(b) modify the obligation of the Issuer and the Partnership to make and
consummate the Change of Control Offer under Section 10.13 (or modify any of the
provisions or definitions with respect thereto in a manner which adversely
affects the rights of Holders);
(c) reduce the percentage in principal amount of the Outstanding Senior
Notes, the consent of whose Holders is required for any such supplemental
indenture or amendment to the TCHI Note Mortgage Documents, or the consent of
whose Holders is required for any waiver (of compliance with certain provisions
of this Indenture or certain Defaults hereunder and their consequences) provided
for in this Indenture, or with respect to the Senior Guarantee or the TCHI Note
Mortgage Documents;
(d) modify any of the provisions of this Section or Section 5.13 and
10.20, except to increase any such percentage or to provide that certain other
provisions of this Indenture or the TCHI Note Mortgage Documents cannot be
modified or waived without the consent of the Holder of each Senior Note
affected thereby; or
(e) except as otherwise permitted by Article Eight, consent to the
assignment or transfer by the Issuer or the Partnership of any of its rights and
obligations under this Indenture; or to the release of any Collateral from the
Liens created by the TCHI Note Mortgage Documents except in accordance with this
Indenture and the TCHI Note Mortgage Documents.
Upon the written request of the Issuer and the Partnership accompanied by
a copy of a Board Resolution authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the consent of
Holders as aforesaid, the Trustee shall join with the Issuer, the Partnership
and any other obligor under the Senior Notes in the execution of such
supplemental indenture.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
The terms of any document entered into pursuant to this Section shall be
subject to prior approval, if required, of the CCC and the NJDGE.
Section 9.3 Execution of Supplemental Indentures and Agreements.
In executing, or accepting the additional trusts created by, any
supplemental indenture, agreement or instrument permitted by this Article or the
modifications thereby of the trusts created by this Indenture, the Trustee shall
be entitled to receive, and shall be fully protected in relying upon, an Opinion
of Counsel and an Officers' Certificate stating that the execution of such
supplemental indenture, agreement or instrument is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental
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indenture, agreement or instrument which affects the Trustee's own rights,
duties or immunities under this Indenture, the Senior Guarantee, the TCHI Note
Mortgage Documents or otherwise.
Section 9.4 Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Senior Notes theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 9.5 Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 9.6 Reference in Senior Notes to Supplemental Indentures.
Senior Notes authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Issuer shall so determine,
new Senior Notes so modified as to conform, in the opinion of the Trustee and
the Board of Directors, to any such supplemental indenture may be prepared and
executed by the Issuer, the Partnership and any other obligor upon the Senior
Notes and authenticated and delivered by the Trustee in exchange for Outstanding
Senior Notes.
Section 9.7 Record Date.
The Issuer may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any supplemental
indenture, agreement or instrument or any waiver, and shall promptly notify the
Trustee of any such record date. If a record date is fixed those Persons who
were Holders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to consent to such supplemental indenture,
agreement or instrument or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such record date. The
record date shall be a date no more than 30 days prior to the first solicitation
of Holders generally in connection therewith and no later than the date such
solicitation is completed. No such consent shall be valid or effective for more
than 90 days after such record date.
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ARTICLE 10
COVENANTS
Section 10.1 Payment of Principal, Premium and Interest.
The Issuer will duly and punctually pay the principal of, premium, if any,
and interest on the Senior Notes in accordance with the terms of the Senior
Notes and this Indenture.
Section 10.2 Maintenance of Office or Agency.
The Issuer will maintain in The City of New York, an office or agency
where Senior Notes may be presented or surrendered for payment, where Senior
Notes may be surrendered for registration of transfer or exchange and where
notices and demands to or upon the Issuer in respect of the Senior Notes and
this Indenture may be served. The office of the Trustee at its Corporate Trust
Office shall be such office or agency of the Issuer, unless the Issuer shall
designate and maintain some other office or agency for one or more of such
purposes. The Issuer will give prompt written notice to the Trustee of any
change in the location of any such office or agency. If at any time the Issuer
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office, and the
Issuer hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
The Issuer may from time to time designate one or more other offices or
agencies (in or outside of The City of New York) where the Senior Notes may be
presented or surrendered for any or all such purposes, and may from time to time
rescind such designation; provided, however, that no such designation or
rescission shall in any manner relieve the Issuer of its obligation to maintain
an office or agency in The City of New York for such purposes. The Issuer will
give prompt written notice to the Trustee of any such designation or rescission
and any change in the location of any such office or agency.
Section 10.3 Money for Senior Note Payments to be Held in Trust.
If the Issuer shall at any time act as its own Paying Agent, it will, on
or before each due date of the principal of, premium, if any, or interest on any
of the Senior Notes, segregate and hold in trust for the benefit of the Holders
entitled thereto a sum sufficient to pay the principal, premium, if any, or
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided, and will promptly notify the Trustee
of its action or failure so to act.
If the Issuer is not acting as Paying Agent, the Issuer will, on or before
each due date of the principal of, premium, if any, or interest on, any Senior
Notes, deposit with a Paying Agent
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a sum in same day funds sufficient to pay the principal, premium, if any, or
interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal, premium or interest, and (unless such Paying
Agent is the Trustee) the Issuer will promptly notify the Trustee of such action
or any failure so to act.
If the Issuer is not acting as Paying Agent, the Issuer will cause each
Paying Agent other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(a) hold all sums held by it for the payment of the principal of, premium,
if any, or interest on the Senior Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(b) give the Trustee notice of any Default by the Issuer or the
Partnership (or any other obligor upon the Senior Notes) in the making of any
deposit of principal, premium, if any, or interest;
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent; and
(d) acknowledge, accept and agree to comply in all aspects with the
provisions of this Indenture relating to the duties, rights and disabilities of
such Paying Agent.
The Issuer may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Issuer
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Issuer or such Paying Agent, as the case may be, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Issuer or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Issuer, in trust for the payment of the principal of, premium, if any, or
interest on any Senior Note and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and payable shall (if
held by the Trustee or any Paying Agent) be paid to the Issuer on Issuer
Request, and shall be discharged from such trust; and the Holder of such Senior
Note shall thereafter, as an unsecured general creditor, look only to the Issuer
for payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Issuer as trustee thereof,
shall thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Issuer cause to be published once, in The New York Times and The Wall Street
Journal (national edition), notice that such money remains unclaimed and that,
after a date
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specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
will be repaid to the Issuer.
Section 10.4 Issuer's and Partnership's Existence.
Subject to Article Eight, the Issuer and the Partnership will do or cause
to be done all things necessary to preserve and keep in full force and effect
the respective corporate or partnership existence, rights (charter and
statutory) and franchises of the Issuer and the Partnership; provided, however,
that the Issuer and the Partnership shall not be required to preserve any such
right or franchise if the Board of Directors of the Issuer shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Issuer and the Partnership and that the loss thereof is not
disadvantageous in any material respect to the Holders.
Section 10.5 Payment of Taxes and Other Claims.
The Issuer and the Partnership each will, and will cause the Subsidiaries
to, pay or discharge or cause to be paid or discharged, before any fine,
penalty, interest or cost may be added for nonpayment, (a) all taxes,
assessments and governmental charges levied or imposed upon the Issuer, the
Partnership or any Subsidiary or upon the income, profits or property of the
Issuer, the Partnership or any Subsidiary and (b) all lawful claims for labor,
materials and supplies, which, if unpaid, might by law become a lien upon the
property of the Issuer, the Partnership or any Subsidiary and shall otherwise
comply with the Senior Partnership Upstream Note Mortgage; provided, however,
that neither the Issuer, the Partnership nor any Subsidiary shall be required to
pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings properly instituted and diligently
conducted and in respect of which appropriate reserves (in the good faith
judgment of management of the Issuer or the Partnership) are being maintained in
accordance with Generally Accepted Accounting Principles consistently applied.
Section 10.6 Maintenance of Properties.
The Issuer and the Partnership will, and will cause the Subsidiaries to,
cause all properties owned by the Issuer, the Partnership or any Subsidiary or
used or held for use in the conduct of the Issuer's or the Partnership's
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order (excepting reasonable wear and tear) and
supplied with all necessary equipment and will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Issuer or the Partnership may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; provided, however, that nothing in this Section shall
prevent the Issuer or the Partnership from discontinuing or allowing the
discontinuance of the maintenance of any of such properties if such
discontinuance is, in the
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judgment of the Issuer or the Partnership, desirable in the conduct of their
respective businesses or the business of any Subsidiary and not disadvantageous
in any material respect to the Holders. Nothing in this Section 10.6 shall
diminish the obligations of the Issuer or the Partnership with respect to the
Collateral as set forth in the Senior Partnership Upstream Note Mortgage.
Section 10.7 Limitation on Partnership Indebtedness.
The Partnership will not, and will not permit any of the Subsidiaries to,
create, incur, assume, or directly or indirectly guarantee or in any other
manner become directly or indirectly liable for the payment of, any Indebtedness
(including any Acquired Indebtedness, but excluding Permitted Indebtedness)
unless, in the case of Indebtedness of the Partnership and Acquired
Indebtedness, (a) the Partnership's Consolidated Fixed Charge Coverage Ratio for
the four full fiscal quarters immediately preceding such event, taken as one
period (and after giving pro forma effect to: (i) the incurrence of such
Indebtedness and (if applicable) the application of the net proceeds therefrom,
including to refinance other Indebtedness, as if such Indebtedness were incurred
and the application of such proceeds occurred at the beginning of such
four-quarter period; (ii) the incurrence, repayment or retirement of any other
Indebtedness by the Partnership or the Subsidiaries since the first day of such
four-quarter period as if such Indebtedness were incurred, repaid or retired at
the beginning of such four-quarter period (except that, in making such
computation, the amount of Indebtedness under any revolving credit facility
shall be computed based upon the average daily balance of such Indebtedness
during such four-quarter period); and (iii) the acquisition (whether by
purchase, merger or otherwise) or disposition (whether by sale, merger or
otherwise) of any company, entity or business acquired or disposed of by the
Partnership or the Subsidiaries, as the case may be, since the first day of such
four-quarter period, as if such acquisition or disposition occurred at the
beginning of such four-quarter period), would have been at least equal to a
ratio of 1.75 to 1.
and (b) except in the case of Permitted Indebtedness, Acquired Indebtedness or
Pari Passu Indebtedness, such Indebtedness created, incurred, assumed or
guaranteed pursuant to this Section (i) has an Average Life to Stated Maturity
that exceeds the remaining Average Life to Stated Maturity of the Senior Notes
and (ii) has a Stated Maturity for its final scheduled principal payment later
than the Stated Maturity for the final scheduled principal payment of the Senior
Notes and (c) if such Indebtedness created, incurred, assumed or guaranteed
pursuant to this Section is Pari Passu Indebtedness which is not Permitted
Indebtedness or Acquired Indebtedness, such Indebtedness shall have (i) an
Average Life to Stated Maturity no shorter than the remaining Average Life to
Stated Maturity of the Senior Notes and (ii) a Stated Maturity for its final
scheduled principal payment that is not earlier than the Stated Maturity for the
final scheduled principal payment of the Senior Notes.
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Section 10.8 Limitation on Liens.
Neither the Issuer nor the Partnership will, nor will any Subsidiary be
permitted to, create, incur, assume or suffer to exist any Liens upon any of
their respective assets, except for the Lien of the TCHI Note Mortgage Documents
and Permitted Liens.
Section 10.9 Limitation on Restricted Payments.
(a) Neither the Issuer, Funding nor the Partnership will, nor will any
Subsidiary be permitted to, directly or indirectly:
(i) declare or make any distribution on the Issuer's Capital Stock,
Funding's Capital Stock or the Partnership's Equity Interests, as the case may
be, (other than distributions payable in the Issuer's Qualified Capital Stock,
Funding's Qualified Capital Stock or the Partnership's Qualified Equity
Interests or in options, warrants or other rights to purchase such Qualified
Capital Stock or Qualified Equity Interests);
(ii) purchase, redeem or otherwise acquire or retire for value any such
Capital Stock or Equity Interests, or any options, warrants or other rights to
acquire such Capital Stock or Equity Interests;
(iii) make any principal payment on or redeem, repurchase, defease or
otherwise acquire or retire for value prior to any scheduled principal payment
or maturity, any Pari Passu Indebtedness (other than Permitted Indebtedness) or
Subordinated Indebtedness of the Partnership other than pursuant to clause
(a)(3) below; or
(iv) incur, create, assume or suffer to exist any guarantee (other than
guarantees existing on the date of this Indenture and any renewals, extensions,
substitutions, refinancings or replacements of such guarantees) of Indebtedness
of any Affiliate of the Partnership or the Issuer;
(the foregoing actions set forth in clauses (i) through (iv) being referred to
as "Restricted Payments"), except that the Partnership may apply up to 50% of
its Excess Available Cash to make a Restricted Payment if: at the time of such
Restricted Payment and after giving effect thereto, (1) no Default or Event of
Default shall have occurred and be continuing; (2) the Partnership's
Consolidated Fixed Charge Coverage Ratio for the four full fiscal quarters
immediately preceding the Restricted Payment, taken as one period (after giving
pro forma effect to the Restricted Payment and (if applicable) the application
of the net proceeds therefrom and any events set forth in clauses (a)(ii) and
(a)(iii) under Section 10.7) would have been at least equal to 1.75 to 1; and
(3) prior to making such Restricted Payment, Funding or the Partnership shall
have used an amount equal to such Restricted Payment to purchase Mortgage Notes
or PIK Notes on the open market or pursuant to a tender offer which purchase
shall not be deemed to be a Restricted Payment.
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(b) Notwithstanding the foregoing, and so long as there is no Default or
Event of Default continuing, the foregoing provisions will not prohibit:
(i) payments made pursuant to the terms of the Services Agreement as in
effect on the date hereof;
(ii) distributions in respect of the Limited Partner Trump Priority
Capital (as defined in the Partnership Agreement) to the extent permitted under
the Amended Partnership Agreement as in effect on the date hereof;
(iii) payment of an annual bonus to Donald J. Trump that has been approved
by a majority of the Noteholder Representatives;
(iv) dividend payments within 60 days after declaration if such payments
would comply with the foregoing provision;
(v) the repurchase, redemption or other acquisition or retirement of any
shares of any class of Capital Stock of the Issuer or Funding or Equity Interest
of the Partnership in exchange for (including any such exchange pursuant to the
exercise of a conversion right or privilege in connection with which cash is
paid in lieu of the issuance of fractional shares, interests or scrip), or out
of the Net Cash Proceeds of a substantially concurrent issue and sale (other
than to a Subsidiary) of, other shares of Capital Stock of the Issuer or Equity
Interests of the Partnership, as the case may be (other than Redeemable Capital
Stock or Redeemable Equity Interests, as the case may be);
(vi) (I) the redemption, repayment, defeasance, repurchase or other
acquisition or retirement for value of any Subordinated Indebtedness or Pari
Passu Indebtedness of the Partnership (other than Redeemable Equity Interests)
in exchange for or out of the net cash proceeds of a substantially current issue
and sale of (A) new Indebtedness of the Partnership or Funding or (B) Equity
Interests of the Partnership (other than Redeemable Equity Interests) or Capital
Stock of the Issuer or Funding (other than Redeemable Capital Stock), provided
that, with respect to clause (A), (1) the aggregate principal amount of any such
new Indebtedness does not exceed the aggregate principal amount of such
Subordinated or Pari Passu Indebtedness (or, if such Subordinated or Pari Passu
Indebtedness provides for an amount less than the principal amount thereof to be
due and payable upon a declaration of acceleration thereof, then such lesser
amount as of the date of determination) plus accrued interest thereon plus the
amount of any premium or other payment required to be paid under the terms of
the instrument governing such Subordinated or Pari Passu Indebtedness or the
amount of any premium reasonably determined by the Partnership as necessary to
accomplish such refinancing by means of a tender offer or privately negotiated
purchase and, in each case, actually paid, plus the amount of expenses of the
Partnership incurred in connection with
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such refinancing, (2) if the Indebtedness so redeemed, repaid, defeased,
repurchased, acquired or retired is Subordinated Indebtedness, any such new
Indebtedness (x) has an Average Life to Stated Maturity that exceeds the Average
Life to Stated Maturity of the Senior Notes and a Stated Maturity that is not
earlier than the final Stated Maturity of the Senior Notes and (y) is expressly
subordinated in right of payment to the Senior Guarantee at least to the same
extent as the Subordinated Indebtedness to be redeemed, repaid, defeased,
repurchased, acquired or retired and (3) if the Indebtedness so redeemed,
repaid, defeased, repurchased, acquired or retired is Pari Passu Indebtedness,
any such new Indebtedness has an Average Life to Stated Maturity that is not
less than the Average Life to Stated Maturity of such Indebtedness and a Stated
Maturity that is not earlier than the final Stated Maturity of such
Indebtedness; or (II) the redemption, repayment, defeasance, repurchase or other
acquisition or retirement for value of any Redeemable Equity Interests of the
Partnership through the issuance of new shares of Redeemable Equity Interests of
the Partnership, provided that any such new Redeemable Equity Interests (1) do
not have a maturity or are otherwise redeemable at the option of the holder
prior to the Stated Maturity of the Senior Notes and (2) are expressly
subordinated in right of payment to the Senior Guarantee at least to the same
extent as Redeemable Equity Interests to be redeemed, repurchased or otherwise
acquired or retired for value;
(vii) the redemption of any share of any class of Capital Stock of the
Issuer or Funding or any Equity Interest of the Partnership or Indebtedness of
the Partnership, Funding or the Issuer, if (A) the holder thereof delivers an
Opinion of Counsel to the Trustee that failure to so redeem would subject the
holder thereof to an adverse action by a Gaming Authority (or, if applicable, a
failure to act by a Gaming Authority that is adverse to the holder) and (B) the
Board of Directors of the Partnership determines (as evidenced by a Board
Resolution delivered to the Trustee) that such adverse action (or, if
applicable, such failure to act) would be likely to have a material adverse
effect on such holder;
(viii) (A) (i) distributions or intercompany loans to Funding by the
Partnership to pay interest in cash on the Outstanding Mortgage Notes in
accordance with the terms thereof and (ii) distributions or intercompany loans
to Funding by the Partnership to pay interest in cash on the Outstanding Funding
Notes in accordance with the terms thereof, (B) distributions or intercompany
loans of up to 50% of the Partnership's Excess Available Cash to Funding by the
Partnership to purchase, redeem or otherwise acquire Outstanding PIK Notes in
accordance with the terms thereof, provided that the Partnership's Consolidated
Fixed Charge Coverage Ratio for the four full fiscal quarters immediately
preceding the Restricted Payment, taken as one period (after giving pro forma
effect to the Restricted Payment and (if applicable) the application of the net
proceeds therefrom and any events set forth in clauses (a)(ii) and (a)(iii) of
Section 10.7 above) would have been at least equal to 1.50 to 1, (C)
distributions or intercompany loans to Funding by the Partnership to pay
interest in cash on the Outstanding PIK Notes
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in accordance with the terms thereof, provided that the condition described in
Clause (a) in Section 10.7 is at that time satisfied and (D) distributions or
intercompany loans to Funding or the Issuer by the Partnership to pay any tax
liability of the Issuer resulting from any distribution or intercompany loan
made in compliance with (A), (B) or (C) above;
(ix) distributions or intercompany loans by the Partnership, pursuant to
the Partnership Agreement as in effect on the date of this Indenture, to pay (a)
reasonable general and administrative expenses, including directors' fees and
premiums for directors' and officers' liability insurance of any corporate
partners and (b) to make indemnification payments as required by the Certificate
of Incorporation of TCHI or Funding or the Partnership Agreement, each as in
effect on the date hereof; and (c) to make distributions by the Partnership,
pursuant to the Partnership Agreement, to Partners in amounts in respect of any
tax year of the Partnership which do not exceed the Partners' tax liability in
respect of the Partnership's income for such year computed as if the Partners
were each taxpayers deriving items of income, gain, loss or deduction only from
the Partnership for such year and by applying the sum of the higher of (x) the
highest federal income tax rate imposed on individuals for such year or (y) the
highest federal income tax rate imposed on corporations for such year, plus (z)
in either case, eight percent (8%) as the rate applicable to such year's
results; and
(x) guarantees by the Partnership of Indebtedness of any special purpose
financing Affiliate of the Partnership, if the incurrence of such guarantee is
made in accordance with Section 10.7 hereof and the net proceeds of any such
Indebtedness are provided to the Partnership.
Section 10.10 Limitation on Partnership Leases.
The Partnership will not, and will not permit any of the Subsidiaries to,
lease as tenant or subtenant real or personal property (except Permitted
Leases), unless the Partnership's Consolidated Fixed Charge Coverage Ratio for
the four full fiscal quarters immediately preceding such event, taken as one
period (and after giving pro forma effect to any such lease as if such lease was
entered into at the beginning of such four-quarter period and any events set
forth in clauses (a)(ii) and (a)(iii) of Section 10.7), would have been at least
equal to a ratio of 1.75 to 1. In giving effect to the lease as of such four
full fiscal quarters, it will be assumed that the rent for such prior four
fiscal quarters was the greater of the (i) average rent over the term of such
lease and (ii) rent payable for the first four fiscal quarters.
Section 10.11 Limitation on Preferred Stock of Subsidiaries and Subsidiary
Distributions.
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(a) The Partnership will not permit any of the Subsidiaries to, directly
or indirectly, issue or sell any Preferred Stock (except to the Partnership or a
Wholly-owned Subsidiary thereof).
(b) The Partnership will not permit any of the Subsidiaries to, directly
or indirectly, (i) declare or pay any dividend or make any distribution on the
Capital Stock of such Subsidiary or to the holders of such Subsidiary's Capital
Stock (other than dividends or distributions payable in Capital Stock of such
Subsidiary) or (ii) purchase, redeem or otherwise acquire or retire for value
any such Capital Stock; provided that this covenant shall not prevent the
payment by any Subsidiary of dividends or other distributions to the Partnership
or a Wholly-owned Subsidiary or the redemption or repurchase by any Subsidiary
of any of its Capital Stock owned by the Partnership or a Wholly-owned
Subsidiary.
Section 10.12 Limitation on Payment Restrictions Affecting Subsidiaries.
The Partnership will not, nor will any of the Subsidiaries be permitted
to, create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction of any kind on the ability of the
Partnership or such Subsidiary to (a) pay dividends or make any other
distributions on the Partnership's Equity Interests or such Subsidiary's Capital
Stock or pay any Indebtedness owed to the Partnership or any other Subsidiary,
(b) make any loans or advances to the Partnership or any other Subsidiary or (c)
transfer any of its property or assets to the Partnership or any other
Wholly-owned Subsidiary, except (i) any restrictions, with respect to a
Subsidiary that is not a Subsidiary on the date of this Indenture, in existence
at the time such Person becomes a Subsidiary of the Partnership (but not created
in contemplation of such Person becoming a Subsidiary), (ii) any restrictions
with respect to a Subsidiary imposed pursuant to an agreement which has been
entered into for the sale or disposition of all or substantially all of the
Capital Stock or assets of such Subsidiary, (iii) any encumbrance or restriction
pursuant to an agreement in effect at or entered into on the date of this
Indenture, and (iv) any restrictions existing under any agreement which
refinances or replaces the agreements containing the restrictions in clauses
(i), (ii) and (iii), provided that the terms and conditions of any such
agreement are no less favorable to holders of the Senior Notes than those under
or pursuant to the agreement evidencing the Indebtedness refinanced.
Section 10.13 Purchase of Senior Notes upon Change of Control.
(a) If a Change of Control shall occur at any time, then each Holder shall
have the right to require that the Issuer or the Partnership repurchase such
Holder's Senior Notes in whole or in part in integral multiples of $1,000, at a
purchase price (the "Change of Control Purchase Price") in cash in an amount
equal to 101% of the principal amount thereof, plus accrued and unpaid interest
(including any Defaulted Interest), if any, to the date of purchase, pursuant to
the offer described in the following paragraph (the "Change of Control Offer")
and the other procedures set forth in this Section.
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(b) Within 30 days following any Change of Control, the Issuer or the
Partnership shall send by first-class mail, postage prepaid, to the Trustee and
to each Holder, at his address appearing in the Senior Note Register, a notice
stating:
(1) that a Change of Control has occurred and that such Holder has the
right to require the Issuer or the Partnership to repurchase such Holder's
Senior Notes at the Change of Control Purchase Price;
(2) the circumstances and relevant facts regarding such Change of Control
(including but not limited to information with respect to pro forma historical
income, cash flow and capitalization after giving effect to such Change of
Control);
(3) the purchase date (the "Change of Control Purchase Date") which shall
be a Business Day no earlier than 45 days nor later than 60 days from the date
such notice is mailed (subject to applicable law);
(4) the Change of Control Purchase Price;
(5) that any Senior Note not tendered will continue to accrue interest;
(6) that, unless the Issuer or the Partnership defaults in payment of the
Change of Control Purchase Price, any Senior Notes accepted for payment pursuant
to the Change of Control Offer shall cease to accrue interest after the Change
of Control Purchase Date; and
(7) the instructions such Holder must follow in order to have its Senior
Notes repurchased (and the instructions it must follow to withdraw its election
to have such Senior Notes repurchased) in accordance with paragraph (c) of this
Section.
Notwithstanding the foregoing, within 20 days following any Change of Control,
the Issuer shall notify the Trustee that a Change of Control has occurred.
(c) Holders electing to have Senior Notes purchased will be required to
surrender such Senior Notes to the Paying Agent at the address specified in the
notice at least two Business Days prior to the Change of Control Purchase Date.
Subject to applicable law, Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than two Business Days prior to the
Change of Control Purchase Date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal amount and serial
numbers of the Senior Notes delivered for purchase by the Holder as to which its
election is to be withdrawn and a statement that such Holder is withdrawing his
election to have such Senior Notes purchased. Holders whose Senior Notes are
purchased only in part will be issued new Senior Notes equal in principal amount
to the unpurchased portion of the Senior Notes surrendered.
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(d) Not later than the Change of Control Purchase Date, the Issuer or the
Partnership, as the case may be, shall (i) accept for payment Senior Notes or
portions thereof tendered pursuant to the Change of Control Offer, (ii) deposit
with the Paying Agent money sufficient, in immediately available funds by 12:00
noon (New York City Time), to pay the purchase price of all Senior Notes or
portions thereof so tendered and (iii) deliver to the Paying Agent an Officers'
Certificate stating the Senior Notes or portions thereof accepted for payment by
the Issuer or the Partnership. The Paying Agent shall promptly mail or release
to Holders of Senior Notes so accepted payment in an amount equal to the Change
of Control Purchase Price of the Senior Notes purchased from each such Holder,
and the Issuer shall execute and the Trustee shall promptly authenticate and
mail or release to such Holders a new Senior Note equal in principal amount to
any unpurchased portion of the Senior Note surrendered. The Issuer or the
Partnership, as the case may be, will publicly announce the results of the
Change of Control Offer on the Change in Control Purchase Date. For purposes of
this Section 10.13, the Issuer shall choose a Paying Agent which shall not be
the Issuer or the Partnership.
(e) The Issuer and the Partnership will not, and will not permit any
Subsidiary to, create or permit to exist or become effective any restriction
(other than restrictions existing under Indebtedness as in effect on the date of
this Indenture) that would materially impair the ability of the Issuer or the
Partnership to make a Change of Control Offer to purchase the Senior Notes or,
if such Change of Control offer is made, to pay for the Senior Notes tendered
for purchase.
Section 10.14 Limitations on Transactions with Affiliates.
Neither the Issuer nor the Partnership will, nor will any of the
Subsidiaries be permitted to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets, property or
services) with any Affiliate of the Issuer or the Partnership (other than a
Wholly-owned Subsidiary) unless (a) such transaction or series of related
transactions is on terms that are no less favorable to the Issuer, the
Partnership or such Subsidiary, as the case may be, than would be available at
the time of such transaction or transactions in a comparable transaction in
arm's-length dealings with an unaffiliated third party and with respect to a
transaction or series of related transactions involving aggregate payments equal
to or greater than $5,000,000, such transaction or series of related
transactions is approved by a majority of the Noteholder Representatives and (b)
the Issuer or the Partnership, as the case may be, delivers an Officers'
Certificate to the Trustee certifying that such transaction or transactions
comply with clause (a) above. The foregoing restriction will not apply to (1)
the operations under the Services Agreement as in effect on the date of this
Indenture, (2) the payment of compensation to the senior executive officers of
the Issuer (excluding Donald J. Trump) which has been approved by a majority of
the Noteholder Representatives, (3) the payment of an annual bonus to Donald J.
Trump which has been approved by a majority of the Noteholder Representatives,
(4) the payment of director fees (other than to Donald J. Trump) not in excess
of those in effect as of the date of this Indenture, (5) payments made pursuant
to the Partnership Agreement as in effect on the date of this Indenture, (6)
payments pursuant to the Senior
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Partnership Note, the Senior Partnership Upstream Note, or with respect to any
Subordinated Indebtedness, and (7) Restricted Payments otherwise permitted
pursuant to the provisions of Section 10.9.
Section 10.15 Restriction on Transfer of Assets.
The Partnership will not sell, convey, transfer, lease or otherwise
dispose of its assets or property to any of the Subsidiaries.
Section 10.16 Limitation on Activities and Investments.
Neither the Partnership nor any of the Subsidiaries will engage in any
business or investment activities other than those necessary or appropriate for,
incident to, in connection with or arising out of, developing, financing, owning
and operating the Casino-Hotel.
The Partnership will not, and will not permit any Subsidiary to, make any
investment other than a Permitted Investment.
The Issuer will not conduct any business (including having any Subsidiary)
whatsoever, other than (i) to collect the amounts due and owing under the Senior
Partnership Upstream Note and any Subordinated Indebtedness, (ii) to preserve
its rights under the Senior Partnership Upstream Note; (iii) to do or cause to
be done all things necessary or appropriate to protect the property included in
the Lien of the Senior Partnership Upstream Note Mortgage and any further
security and to preserve its rights therein and otherwise to comply with its
obligations under this Indenture and the Senior Notes; and (iv) to serve as the
general partner of the Partnership.
The Issuer will not incur or otherwise become liable for any Indebtedness
(other than (x) the Senior Notes and renewal, extension, substitution,
refunding, refinancing or replacement thereof in accordance with this Indenture,
and (y) any intercompany loan from the Partnership) nor issue any Preferred
Stock.
Section 10.17 Restriction on Payment of Services Fee.
The Issuer and the Partnership will not, and will not permit the
Subsidiaries to, pay any Services Fee under the Services Agreement or to pay or
reimburse any expenses relating thereto if a Default or Event of Default has
occurred and is continuing. The terms of the Services Agreement cannot be
amended to increase the amounts to be paid thereunder in the aggregate or on any
particular date, or in any other manner which would be adverse to the
Partnership, and the Partnership will not, and will not permit the Subsidiaries
to, enter into any management or consulting agreement with any Affiliate
relating to the Casino Hotel other than the Services Agreement.
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Section 10.18 Provision of Financial Statements.
Whether or not the Issuer or the Partnership is subject to Section 13(a)
or 15(d) of the Exchange Act, the Issuer and the Partnership will, to the extent
permitted under the Exchange Act, file with the SEC the annual reports,
quarterly reports and other documents which the Issuer or the Partnership would
have been required to file with the SEC pursuant to such Section 13(a) or 15(d)
if the Issuer or the Partnership were so subject, such documents to be filed
with the SEC on or prior to the respective dates (the "Required Filing Dates")
by which the Issuer or the Partnership would have been required so to file such
documents if the Issuer or the Partnership were so subject. The Issuer or the
Partnership will also in any event (x) within 15 days of each Required Filing
Date (i) transmit by mail to all Holders, as their names and addresses appear in
the Senior Note Register, without cost to such Holders and (ii) file with the
Trustee copies of the annual reports, quarterly reports and other documents
which the Issuer or the Partnership would have been required to file with the
SEC pursuant to Section 13(a) or 15(d) of the Exchange Act if the Issuer or the
Partnership were subject to such Sections and (y) if filing such documents by
the Issuer or the Partnership with the SEC is not permitted under the Exchange
Act, promptly upon written request, supply copies of such documents to a
prospective holder of the Senior Notes at the Issuer's cost.
Section 10.19 Statement by Officers as to Default.
(a) The Issuer will deliver to the Trustee, on or before a date not more
than 60 days after the end of each fiscal quarter and not more than 120 days
after the end of each fiscal year of the Issuer ending after the date hereof, a
written statement signed by the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Comptroller, an Assistant Comptroller,
the Secretary or an Assistant Secretary of the Issuer, and in any event at least
one person signing such certificate shall be the principal executive officer,
principal financial officer or principal accounting officer of the Issuer,
setting forth the Consolidated Net Worth of the Issuer as of the end of such
fiscal quarter and stating whether or not, after a review under each signer's
supervision of the activities of the Issuer during such year and of the Issuer's
performance under this Indenture, to the best knowledge, based on such review,
of the signers thereof, the Issuer has fulfilled all its obligations under this
Indenture throughout such year, and, if there has been a Default specifying each
Default and the nature and status thereof.
(b) When any Default or Event of Default has occurred and is continuing,
or if the Trustee or any Holder or the trustee for or the holder of any other
evidence of Indebtedness of the Issuer or any Subsidiary gives any notice or
takes any other action with respect to a claimed default (other than with
respect to Indebtedness (other than any Mortgage Debt) in the principal amount
of less than $10,000,000), the Issuer shall deliver to the Trustee by registered
or certified mail or by telegram, telex or facsimile transmission followed by
hard copy an Officers' Certificate specifying such event, notice or other action
within five Business Days of its occurrence.
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Section 10.20 Waiver of Certain Covenants.
The Issuer and the Partnership may omit in any particular instance to
comply with any covenant or condition set forth in Sections 8.1(a)(ii) and
(iii)(B) or Sections 10.5 through 10.12, Sections 10.14, 10.15, 10.17, 10.19 and
10.21, if, before or after the time for such compliance, the Holders of not less
than a majority in aggregate principal amount of the then Outstanding Senior
Notes shall, by Act of such Holders, waive such compliance in such instance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Issuer and the Partnership
and the duties of the Trustee in respect of any such covenant or condition shall
remain in full force and effect.
Section 10.21 Mortgage Notes and PIK Notes.
Notwithstanding anything to the contrary contained in this Indenture,
without the consent of the Holders of not less than a majority in the aggregate
principal amount of the then Outstanding Senior Notes by Act of such Holders
delivered to the Partnership, neither the Partnership nor Funding shall directly
or indirectly effect (i) any amendment or supplement to the Mortgage Note
Indenture which causes or permits (a) any change to the stated maturity date of
the Mortgage Notes to before November 15, 2003 or (b) any redemptions of the
Mortgage Notes (including, without limitation, any open market purchases or
purchases made pursuant to a tender offer) except as permitted in and on terms
included in the Mortgage Note Indenture as in effect on the date hereof; (ii)
any redemption of the Mortgage Notes (including, without limitation, any open
market purchases or purchases made pursuant to a tender offer), except in
connection with making a Restricted Payment, as required by clause (3) of
Section 10.9(a) hereof; or (iii) any amendment or supplement to the PIK Note
Indenture which causes or permits (a) any change to the stated maturity date of
the PIK Notes to before November 15, 2005 or (b) any redemptions of the PIK
Notes (including, without limitation, any open market purchases or purchases
made pursuant to a tender offer) except as permitted in and on terms included in
the PIK Note Indenture as in effect on the date hereof.
ARTICLE 11
REDEMPTION OF SENIOR NOTES
Section 11.1 Senior Notes Redeemed Pursuant to Casino Control Act.
Notwithstanding any provisions of this Article Eleven to the contrary, if
the CCC does not waive the qualification requirements as to any Holder (whether
the record owner or beneficial owner) and requires that such Holder be qualified
under the New Jersey Casino Control Act, then, in such event, such Holder must
qualify under such Act. If such Holder does not so qualify, such Holder must
dispose of its interest in the Senior Notes, within 30 days after the
Partnership's receipt of notice of such finding (or within such earlier date as
the CCC may
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require), or the Issuer or the Partnership may redeem such Senior Notes at the
lower of the Outstanding Amount and the Fair Market Value (as certified to the
Trustee) of such Senior Notes.
Section 11.2 Optional Redemption
The Issuer or the Partnership may at their election, redeem all, but not
less than all of the Senior Notes at 100% of the principal amount thereof, in
each case, together with accrued and unpaid interest through the Redemption
Date; provided, however, that no redemption of Senior Notes shall be made
pursuant to this Section 11.2 unless the Partnership or Funding concurrently
redeems all of the Funding Notes pursuant to Section 11.2 of the Funding Note
Indenture.
Section 11.3 Senior Notes Redeemed Pursuant to a Total Taking or Casualty.
In the event of a Total Taking or Casualty, the Issuer or the Partnership
shall, within 60 days after receipt of any condemnation or insurance proceeds
but within one year after the occurrence of such Total Taking or Casualty,
redeem the Senior Notes at 100% of the principal amount thereof, in each case,
together with accrued and unpaid interest through the Redemption Date, in
accordance with this Article Eleven.
Section 11.4 Applicability of Article.
Redemption of Senior Notes as required by any provision of this Indenture,
shall be made in accordance with such provision and this Article.
Section 11.5 Notice to Trustee.
In case of any redemption in accordance with Sections 11.1, 11.2 or 11.3
hereof, the Issuer or the Partnership, as the case may be, shall, at least 60
days prior to the Redemption Date fixed by the Issuer or the Partnership (unless
a shorter notice period shall be satisfactory to the Trustee) notify the Trustee
in writing of such Redemption Date and of the principal amount of Senior Notes
to be redeemed.
Section 11.6 Selection by Trustee of Senior Notes to Be Redeemed.
If less than all the Senior Notes are to be redeemed, the particular
Senior Notes or portions thereof to be redeemed shall be selected not more than
60 days prior to the Redemption Date by the Trustee, from the Outstanding Senior
Notes not previously called for redemption pro rata, by lot or by any other
method as the Trustee shall deem fair and reasonable, and the amounts to be
redeemed may be equal to $1,000 or any integral multiple thereof.
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The Trustee shall promptly notify the Issuer, the Partnership and the
Senior Note Registrar in writing of the Senior Notes selected for redemption
and, in the case of any Senior Notes selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to redemption of Senior Notes shall relate, in the case
of any Senior Note redeemed or to be redeemed only in part, to the portion of
the principal amount of such Senior Note which has been or is to be redeemed.
Section 11.7 Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Senior Notes to be redeemed, at his address appearing in the
Senior Note Register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all outstanding Senior Notes are to be redeemed, the
identification of the particular Senior Notes to be redeemed;
(d) in the case of a Senior Note to be redeemed in part, the principal
amount of such Senior Note to be redeemed and that after the Redemption Date
upon surrender of such Senior Note, new Senior Note or Senior Notes in the
aggregate principal amount equal to the unredeemed portion thereof will be
issued;
(e) that Senior Notes called for redemption must be surrendered to the
Paying Agent to collect payment of the Redemption Price;
(f) that on the Redemption Date the Redemption Price will become due and
payable upon each such Senior Note or portion thereof, and that (unless the
Issuer or the Partnership shall default in payment of the Redemption Price)
interest thereon shall cease to accrue on and after said date;
(g) the place or places where such Senior Notes are to be surrendered for
payment of the Redemption Price;
(h) the CUSIP number, if any, relating to such Senior Notes; and
(i) if applicable, that such redemption is a result of a Total Taking or
Casualty.
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Notice of redemption of Senior Notes to be redeemed shall be given by the
Issuer or, at the Issuer's written request, by the Trustee in the name and at
the expense of the Issuer.
The notice if mailed in the manner herein provided shall be conclusively
presumed to have been given, whether or not the Holder receives such notice. In
any case, failure to give such notice by mail or any defect in the notice to the
Holder of any Senior Note designated for redemption as a whole or in part shall
not affect the validity of the proceedings for the redemption of any other
Senior Note.
Section 11.8 Deposit of Redemption Price.
On or prior to any Redemption Date, the Issuer or the Partnership shall
deposit with the Trustee or with a Paying Agent (or, if the Issuer or the
Partnership is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 10.3) an amount of money in same day funds sufficient to pay
the Redemption Price of, and (except if the Redemption Date shall be an Interest
Payment Date) accrued interest on, all the Senior Notes or portions thereof
which are to be redeemed on that date.
Section 11.9 Senior Notes Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Senior Notes so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Issuer or the Partnership shall default in the payment of the Redemption Price
and accrued interest) such Senior Notes shall cease to bear interest. Upon
surrender of any such Senior Note for redemption in accordance with said notice,
such Senior Note shall be paid by the Issuer or the Partnership, as the case may
be, at the Redemption Price together with accrued and unpaid interest (including
Defaulted Interest) to the Redemption Date; provided, however, that installments
of interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Senior Notes, or one or more Predecessor Senior
Notes, registered as such on the relevant Regular Record Dates according to the
terms and the provisions of Section 3.7.
If any Senior Note called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any, shall,
until paid, bear interest from the Redemption Date at the rate borne by such
Senior Note.
Section 11.10 Senior Notes Redeemed in Part.
Any Senior Note which is to be redeemed only in part shall be surrendered
to the Paying Agent at the office or agency maintained for such purpose pursuant
to Section 10.2 (with, if the Issuer, the Partnership, the Senior Note Registrar
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Issuer, the Partnership, the Senior Note
Registrar or the Trustee duly executed by, the Holder thereof or such Holder's
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attorney duly authorized in writing), and the Issuer shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Senior Note without
service charge, a new Senior Note or Senior Notes, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to,
and in exchange for, the unredeemed portion of the principal of the Senior Note
so surrendered that is not redeemed.
ARTICLE 12
TCHI NOTE MORTGAGE DOCUMENTS
Section 12.1 TCHI Note Mortgage Documents.
(a) In order to secure the due and punctual payment of the Indenture
Obligations, the Issuer, the Partnership and the Trustee have entered into the
TCHI Note Mortgage Documents dated of even date herewith to create the security
interests thereunder and for related matters. The Issuer and the Partnership
covenant and agree that they have full right, power and lawful authority to
grant, bargain, sell, release, convey, hypothecate, assign, mortgage, pledge,
transfer, confirm and grant a security interest in the property constituting the
Collateral, in the manner and form done in the TCHI Note Mortgage Documents or
intended to be done, and that (a) each will forever warrant and defend the title
to the same against the claims of all Persons whatsoever in each case free and
clear of all Liens whatsoever, except Permitted Liens, (b) each will execute,
acknowledge and deliver to the Trustee such further assignments, transfers,
assurances or other instruments as the Trustee may reasonably require or
request, and (c) each will do or cause to be done all such acts and things as
may be necessary or proper, or as may be reasonably required by the Trustee, to
assure and confirm to the Trustee its interest in the Collateral, or any part
thereof, as from time to time constituted, and the right, title and interest in
and to the TCHI Note Mortgage Documents so as to render the same available for
the security and benefit of this Indenture and of the Senior Notes.
(b) Each Holder, by accepting a Senior Note, consents and agrees to all of
the terms and provisions of the TCHI Note Mortgage Documents, as the same may be
amended from time to time pursuant to the provisions of the TCHI Note Mortgage
Documents and this Indenture, and authorizes and directs the Trustee to enter
into the TCHI Note Mortgage Documents to which it is a party and to perform its
obligations and exercise its rights thereunder in accordance therewith;
provided, however, that if any provision of the TCHI Note Mortgage Documents
limits, qualifies, or conflicts with the duties imposed by the provisions of the
Trust Indenture Act, the Trust Indenture Act controls.
(c) As amongst the Holders, the Collateral as now or hereafter constituted
shall be held for the equal and ratable benefit of the Holders without
preference, priority or distinction of any thereof over any other by reason of
difference in time of issuance, sale or otherwise, as security for the Indenture
Obligations.
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Section 12.2 Recording, Opinion of Counsel, Etc.
The Issuer and the Partnership will cause, at their own expense, this
Indenture, the Senior Notes, the TCHI Note Mortgage Documents, and all
amendments or supplements thereto, to be registered, recorded and filed and/or
re-recorded and/or re-filed and/or renewed in such manner and in such place or
places, if any, as may be required by law in order fully to preserve and protect
the Liens of the TCHI Note Mortgage Documents and all parts of the Collateral
and to effectuate and preserve the security of the Holders and all rights of the
Trustee.
The Issuer and the Partnership shall furnish to the Trustee:
(a) promptly after the execution and delivery of this Indenture and each
of the TCHI Note Mortgage Documents or other instrument of further assurance, an
Opinion of Counsel stating that, in the opinion of such Counsel, the TCHI Note
Mortgage Documents and other instruments of further assurance have been properly
recorded, endorsed, registered and filed, so as to make effective the Lien
intended to be created thereby, and reciting the details of such action or
stating that, in the opinion of such Counsel, no such action is necessary to
make such Liens effective; and
(b) within 60 days after November 30 in each year beginning with the year
1998, an Opinion of Counsel, dated as of such date, either stating that, in the
opinion of such Counsel, such action has been taken with respect to the
recording, registering, filing, re-recording, re-registering and re-filing of
this Indenture and the TCHI Note Mortgage Documents, financing statements,
supplemental indentures, continuation statements or other instruments of further
assurance as is necessary to maintain the Lien of the TCHI Note Mortgage
Documents and reciting the details of such action, or stating that, in the
opinion of counsel, no such action prior to November 30 of the subsequent year
is necessary to maintain such Lien.
The Trustee shall hold in its possession the TCHI Note Mortgage Documents,
except as it from time to time may be required for actions, suits or proceedings
relating to the TCHI Note Mortgage Documents or for the purpose of enforcing or
realizing upon any right or value thereby represented. The Trustee may, from
time to time, in its sole discretion, for the purpose of convenient location of
the TCHI Note Mortgage Documents, appoint one or more agents to hold physical
custody, for the account of the Trustee, of the TCHI Note Mortgage Documents.
Section 12.3 Release of Collateral.
To the extent applicable, the Issuer, the Partnership and each other
obligor on the Senior Notes shall cause ss. 314(d) of the Trust Indenture Act
relating to the release of property or securities from the Liens of the TCHI
Note Mortgage Documents to be complied with.
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Section 12.4 Trust Indenture Act Requirements.
The release of any Collateral from the terms of the TCHI Note Mortgage
Documents or the release, in whole or in part, of the Liens created by any of
the TCHI Note Mortgage Documents, will not be deemed to impair the security
interests thereunder in contravention of the provisions of this Indenture if and
to the extent the Collateral or Liens are released pursuant to, and in
accordance with, the applicable TCHI Note Mortgage Documents and pursuant to,
and in accordance with, the terms hereof. As set forth in Section 12.3, to the
extent applicable, without limitation, the Issuer, the Partnership and each
other obligor on the Senior Notes shall cause ss. 314(d) of the Trust Indenture
Act relating to the release of property or securities from the Liens of the TCHI
Note Mortgage Documents to be complied with. Any certificate or opinion required
by ss. 314(d) of the Trust Indenture Act may be made by two officers of the
company, except in cases in which ss. 314(d) of the Trust Indenture Act requires
that such certificate or opinion be made by an independent Person.
Section 12.5 Disposition of Certain Collateral without Requesting Release.
(a) Notwithstanding the provisions of Sections 12.3 and 12.4 hereof, the
Partnership may, pursuant to and in accordance with the TCHI Note Mortgage
Documents and this Indenture, without requesting the release or consent of the
Trustee:
(i) sell or dispose of, free from the Lien of the TCHI Note Mortgage
Documents, any Tangible Personal Property which, in its reasonable opinion, may
have become obsolete or unfit for use or which is no longer necessary in the
conduct of its businesses or the operation of the Collateral or the disposal of
cash free from the Lien of the TCHI Note Mortgage Documents in the ordinary
course of business;
(ii) alter, repair, replace, change the location or position of and add to
any Tangible Personal Property;
(iii) renew, extend, surrender, terminate, modify or amend any leases of
Tangible Personal Property, when, in its reasonable opinion, it is prudent to do
so; and
(iv) enter into all non-material title encumbrances described within the
definition of "Permitted Encumbrances" under the Senior Partnership Upstream
Note Mortgage, and including without limitation those transactions described in
Section 5.3 of the Senior Partnership Upstream Note Mortgage.
(b) Notwithstanding the provisions of Subsection (a) above, (x) the
Partnership shall not dispose of or transfer (by lease, assignment, sale or
otherwise), or pledge, mortgage or otherwise encumber (other than Permitted
Liens), Collateral pursuant to the provisions of Section 12.5(a) with a fair
value to the obligor equal to 10% or more of the aggregate fair value of all
Collateral then existing (as determined in the good faith judgment of the Issuer
or the
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Partnership and, if required by the Trust Indenture Act, an independent
appraiser), in any transaction or any series of related transactions without
complying with Sections 12.3 and 12.4; and (y) the right of the Partnership to
rely upon the provisions of Section 12.5(a) from the date of this Indenture to
June 30, 1998 and for each semiannual period thereafter shall be conditioned
upon the Partnership delivering to the Trustee, on or before August 31, 1998 and
thereafter within 60 days following each February 28 and August 31, an Officers'
Certificate to the effect that all of such dispositions by the Partnership
during such semiannual period (other than those such dispositions, collections
or payments wherein the Partnership has complied with Sections 12.3 and 12.4)
were in the ordinary course of the Partnership's business and that the proceeds
therefrom were used by the Partnership in connection with its business.
(c) Any disposition of Collateral made in compliance with the provisions
of this Section 12.5 shall be deemed not to impair the Liens of the TCHI Note
Mortgage Documents in contravention of the provisions of this Indenture.
(d) Upon receipt of an Issuer Request, the Trustee shall execute and
deliver, within five business days from the receipt of the Issuer Request, any
instrument deemed by the Partnership to be necessary or appropriate to dispose
of portions of the Collateral pursuant to this Section 12.5 if the provisions of
this Section 12.5 have been complied with.
Section 12.6 Suits to Protect the Collateral.
Subject to the provisions of the TCHI Note Mortgage Documents, (i) the
Trustee may, in its sole discretion and without the consent of the Holders, take
all actions it deems necessary or appropriate in order to (a) enforce any of the
terms of the TCHI Note Mortgage Documents and (b) collect and receive any and
all amounts payable in respect of the obligations of the Issuer and the
Partnership and (ii) the Trustee shall have power to institute and to maintain
such suits and proceedings as it may deem expedient to prevent any impairment of
the Collateral by any acts which may be unlawful or in violation of the TCHI
Note Mortgage Documents or this Indenture, including such suits and proceedings
as the Trustee may deem expedient to preserve or protect its interests and the
interests of the Holders in the Collateral and in the principal, interest,
issues, profits, rents, revenues and other income arising therefrom (including
power to institute and maintain suits or proceedings to restrain the enforcement
of or compliance with any legislative or other governmental enactment, rule or
order that may be unconstitutional or otherwise invalid if the enforcement of,
or compliance with, such enactment, rule or order would impair the security
interests or be prejudicial to the interests of the Holders or the Trustee).
Section 12.7 Determinations Relating to Collateral.
In the event (i) the Trustee shall receive any written request from the
Issuer or the Partnership under any TCHI Note Mortgage Documents for consent or
approval with respect to any matter or thing relating to any Collateral or the
Issuer's or the Partnership's obligations with
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respect thereto or (ii) there shall be due to or from the Trustee under the
provisions of the TCHI Note Mortgage Documents any material performance or the
delivery of any material instrument or (iii) the Trustee shall become aware of
any nonperformance by the Issuer or the Partnership of any covenant or any
breach of any representation or warranty of the Issuer or the Partnership set
forth in the TCHI Note Mortgage Documents, then, in each such event, the Trustee
shall be entitled to hire experts, consultants, agents and attorneys to advise
the Trustee on the manner in which the Trustee should respond to such request or
render any requested performance or respond to such nonperformance or breach.
The Trustee shall be fully protected in the taking of any action recommended or
approved by any such expert, consultant, agent or attorney or agreed to by the
Holders of a majority in principal amount of the Outstanding Senior Notes
pursuant to Section 5.12.
Section 12.8 Impairment of Security Interest.
The Issuer and the Partnership will not, and will not permit any
Subsidiary to, take or omit to take any action which reasonably might or would
have the result of affecting or impairing the security interests with respect to
the Collateral in contravention of this Indenture, and the Issuer and the
Partnership shall not (and shall cause the Subsidiaries not to) grant to, or
suffer to exist in favor of, any Person any interest whatsoever in the
Collateral except as permitted by the TCHI Note Mortgage Documents or this
Indenture. The Issuer and the Partnership will not, and will not permit any
Subsidiary to, enter into any agreement or instrument that by its terms
expressly requires that the proceeds received from the sale of any Collateral be
applied to repay, redeem or otherwise retire any Indebtedness of any Person
other than as set forth in this Article Twelve and in the TCHI Note Mortgage
Documents.
Section 12.9 Release Upon Termination of the Issuer's Obligations.
(a) In the event that the Issuer delivers an Officers' Certificate
certifying that all of the Indenture Obligations have been indefeasibly
satisfied and discharged by complying with the provisions of Article Thirteen or
Sections 4.2 or 4.3, the Trustee shall deliver to the Issuer at the Issuer's
expense a notice stating that, subject to Section 4.6, the Trustee, on behalf of
the Holders, disclaims and gives up any and all rights it has in or to the
Collateral, and any rights it has under the TCHI Note Mortgage Documents, and on
demand of and at the expense of the Issuer or the Partnership, the Trustee shall
also execute and deliver proper instruments acknowledging the satisfaction and
discharge of this Indenture and all TCHI Note Mortgage Documents and, upon and
after the receipt by the Issuer of such notice, the Trustee shall not be deemed
to hold the security interests in the Collateral for the benefit of the Holders
and shall deliver to the Issuer any Collateral in its possession.
(b) Any release of any portion of the Collateral made strictly in
compliance with the provisions of this Section 12.9 shall not be deemed to
impair the security interests in the Collateral created by the TCHI Note
Mortgage Documents in contravention of the provisions of this Indenture.
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Section 12.10 Authorization of Receipt of Funds by the Trustee Under the
TCHI Note Mortgage Documents.
The Trustee is authorized to receive any funds for the benefit of Holders
of Senior Notes distributed under the TCHI Note Mortgage Documents, and to make
further distributions of such funds to the Holders according to the provisions
of this Indenture.
ARTICLE 13
SATISFACTION AND DISCHARGE
Section 13.1 Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to surviving
rights of registration of transfer or exchange of Senior Notes herein expressly
provided for) and the Trustee, on demand of and at the expense of the Issuer or
the Partnership, shall execute and deliver proper instruments acknowledging
satisfaction and discharge of this Indenture and all TCHI Note Mortgage
Documents, when
(a) either
(1) all Senior Notes theretofore authenticated and delivered (other than
(i) Senior Notes which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 3.6 and (ii) Senior Notes for whose
payment funds have theretofore been deposited in trust or segregated and held in
trust by the Issuer and thereafter repaid to the Issuer or discharged from such
trust, as provided in Section 10.3) have been delivered to the Trustee for
cancellation; or
(2) all such Senior Notes not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one year,
or
(iii) are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Issuer and the Partnership,
and the Issuer or the Partnership, in the case of (2)(i), (ii) or (iii) above,
has irrevocably deposited or caused to be deposited with the Trustee as trust
funds in trust an amount in cash in lawful currency of the United States of
America or U.S. Government Obligations
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sufficient to pay and discharge the entire Indebtedness on such Senior Notes not
theretofore delivered to the Trustee for cancellation, including principal of,
premium, if any, and accrued interest on such Senior Notes, at such Stated
Maturity or Redemption Date;
(b) the Issuer and the Partnership have paid or caused to be paid all
other sums payable hereunder by the Issuer or the Partnership; and
(c) the Issuer and the Partnership have delivered to the Trustee an
Officers' Certificate and an opinion of Counsel each stating that (i) all
conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with and (ii) such satisfaction
and discharge will not result in a breach or violation of, or constitute a
default under, this Indenture or any other material agreement or instrument to
which the Issuer or the Partnership is a party or by which the Issuer or the
Partnership is bound.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Issuer and the Partnership to the Trustee under Section 6.6
and, if money shall have been deposited with the Trustee pursuant to subclause
(2) of Subsection (a) of this Section, the obligations of the Trustee under
Section 4.2 and the last paragraph of Section 10.3 shall survive.
Section 13.2 Application of Trust Money.
Subject to the provisions of the last paragraph of Section 10.3, all funds
deposited with the Trustee pursuant to Section 13.1 shall be held in trust and
applied by it, in accordance with the provisions of the Senior Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Issuer acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal of, premium, if
any, and interest on the Senior Notes for whose payment such funds have been
deposited with the Trustee.
ARTICLE 14
SENIOR GUARANTEE
Section 14.1 Partnership Senior Guarantee.
For value received, the Partnership in accordance with this Article
Fourteen and, subject to Section 3.11 hereof, hereby absolutely, unconditionally
and irrevocably guarantees to the Trustee and the Holders, as if the Partnership
were the principal debtor, the punctual payment and performance when due of all
Indenture Obligations (which for purposes of this Senior Guarantee shall also be
deemed to include all commissions, fees, charges, costs and other expenses
(including reasonable legal fees and disbursements of one counsel) arising out
of or
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incurred by the Trustee or the Holders in connection with the enforcement of
this Senior Guarantee).
Section 14.2 Continuing Guarantee; No Right of Set-Off; Independent
Obligation.
(a) This Senior Guarantee shall be a continuing guarantee of the payment
and performance of all Indenture Obligations and shall remain in full force and
effect until the payment in full of all of the Indenture Obligations and shall
apply to and secure any ultimate balance due or remaining unpaid to the Trustee
or the Holders; and this Senior Guarantee shall not be considered as wholly or
partially satisfied by the payment or liquidation at any time or from time to
time of any sum of money for the time being due or remaining unpaid to the
Trustee or the Holders. The Partnership covenants and agrees to comply with all
obligations, covenants, agreements and provisions applicable to it in this
Indenture including those set forth in Article Eight. Without limiting the
generality of the foregoing, the Partnership's liability shall extend to all
amounts which constitute part of the Indenture Obligations and would be owed by
the Issuer under this Indenture and the Senior Notes but for the fact that they
are unenforceable, reduced, limited, impaired, suspended or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
the Issuer.
(b) The Partnership hereby guarantees that the Indenture Obligations will
be paid to the Trustee without set-off or counterclaim or other reduction
whatsoever (whether for taxes, withholding or otherwise) in lawful currency of
the United States of America.
(c) The Partnership guarantees that the Indenture Obligations shall be
paid strictly in accordance with their terms regardless of any law, regulation
or order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Holders of the Senior Notes.
(d) The Partnership's liability to pay or perform or cause the performance
of the Indenture Obligations under this Senior Guarantee shall arise forthwith
after demand for payment or performance by the Trustee has been given to the
Partnership in the manner prescribed in Section 1.6 hereof.
(e) Except as provided herein, the provisions of this Article Fourteen
cover all agreements between the parties hereto relative to this Senior
Guarantee and none of the parties shall be bound by any representation, warranty
or promise made by any Person relative thereto which is not embodied herein; and
it is specifically acknowledged and agreed that this Senior Guarantee has been
delivered by the Partnership free of any conditions whatsoever and that no
representations, warranties or promises have been made to the Partnership
affecting its liabilities hereunder, and that the Trustee shall not be bound by
any representations, warranties or promises now or at any time hereafter made by
the Issuer to the Partnership.
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<PAGE>
Section 14.3 Guarantee Absolute.
The obligations of the Partnership hereunder are independent of the
obligations of the Issuer under the Senior Notes and this Indenture and a
separate action or actions may be brought and prosecuted against the Partnership
whether or not an action or proceeding is brought against the Issuer and whether
or not the Issuer is joined in any such action or proceeding. The liability of
the Partnership hereunder is irrevocable, absolute and unconditional and (to the
extent permitted by law) the liability and obligations of the Partnership
hereunder shall not be released, discharged, mitigated, waived, impaired or
affected in whole or in part by:
(a) any defect or lack of validity or enforceability in respect of any
indebtedness or other obligation of the Issuer or any other Person under this
Indenture or the Senior Notes, or any agreement or instrument relating to any of
the foregoing;
(b) any grants of time, renewals, extensions, indulgences, releases,
discharges or modifications which the Trustee or the Holders may extend to, or
make with, the Issuer, the Partnership or any other Person, or any change in the
time, manner or place of payment of, or in any other term of, all or any of the
Indenture Obligations, or any other amendment or waiver of, or any consent to or
departure from, this Indenture or the Senior Notes, including any increase or
decrease in the Indenture Obligations;
(c) the taking of security from the Issuer, the Partnership or any other
Person, and the release, discharge or alteration of, or other dealing with, such
security;
(d) the occurrence of any change in the laws, rules, regulations or
ordinances of any jurisdiction by any present or future action of any
governmental authority or court amending, varying, reducing or otherwise
affecting, or purporting to amend, vary, reduce or otherwise affect, any of the
Indenture Obligations and the obligations of the Partnership hereunder;
(e) the abstention from taking security from the Issuer, the Partnership
or any other Person or from perfecting, continuing to keep perfected or taking
advantage of any Lien of the Senior Partnership Upstream Note Mortgage;
(f) any loss, diminution of value or lack of enforceability of any Senior
Note received from the Issuer, the Partnership or any other Person, and
including any other guarantees received by the Trustee;
(g) any other dealings with the Issuer, the Partnership or any other
Person, or with any Senior Note;
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<PAGE>
(h) the Trustee's or the Holder's acceptance of compositions from the
Issuer or the Partnership;
(i) the application by the Holders or the Trustee of all monies at any
time and from time to time received from the Issuer, the Partnership or any
other Person on account of any indebtedness and liabilities owing by the Issuer
or the Partnership to the Trustee or the Holders, in such manner as the Trustee
or the Holders deems best and the changing of such application in whole or in
part and at any time or from time to time, or any manner of application of
collateral, or proceeds thereof, to all or any of the Indenture Obligations, or
the manner of sale of any Collateral;
(j) the release or discharge of the Issuer or the Partnership or of any
other guarantor of the Senior Notes or of any Person liable directly as surety
or otherwise by operation of law or otherwise for the Senior Notes, other than
an express release in writing given by the Trustee, on behalf of the Holders, of
the liability and obligations of the Partnership hereunder;
(k) any change in the name, business, capital structure or governing
instrument of the Issuer or the Partnership or any refinancing or restructuring
of any of the Indenture Obligations;
(l) the sale of the Issuer's or the Partnership's business or any part
thereof;
(m) any merger or consolidation, arrangement or reorganization of the
Issuer, the Partnership, any Person resulting from the merger or consolidation
of the Issuer or the Partnership with any other Person or any other successor to
such Person or merged or consolidated Person or any other change in the
corporate existence, structure or ownership of the Issuer or the Partnership;
(n) the insolvency, bankruptcy, liquidation, winding-up, dissolution,
receivership or distribution of the assets of the Issuer or its assets or any
resulting discharge of any obligations of the Issuer (whether voluntary or
involuntary) or of the Partnership of the loss of corporate existence;
(o) any arrangement or plan of reorganization affecting the Issuer or the
Partnership;
(p) any other circumstance (including any statute of limitations) that
might otherwise constitute a defense available to, or discharge of, the Issuer
or the Partnership; or
(q) any modification, compromise, settlement or release by the Trustee, or
by operation of law or otherwise, of the Indenture Obligations or the liability
of the Issuer or any other obligor under the Senior Notes, or of any Collateral,
in whole
-101-
<PAGE>
or in part, and any refusal of payment by the Trustee, in whole or in part, from
any other obligor or other guarantor in connection with any of the Indenture
Obligations, whether or not with notice to, or further assent by, or any
reservation of rights against, the Partnership.
Section 14.4 Right to Demand Full Performance.
In the event of any demand for payment or performance by the Trustee from
the Partnership hereunder, the Trustee or the Holders shall have the right to
demand its full claim and to receive all dividends or other payments in respect
thereof until the Indenture Obligations have been paid in full, and the
Partnership shall continue to be liable hereunder for any balance which may be
owing to the Trustee or the Holders by the Issuer under this Indenture and the
Senior Notes. The retention by the Trustee or the Holders of any Senior Note,
prior to the realization by the Trustee or the Holders of its rights to such
Senior Note upon foreclosure thereon, shall not, as between the Trustee and the
Partnership, be considered as a purchase of such Senior Note, or as payment,
satisfaction or reduction of the Indenture Obligations due to the Trustee or the
Holders by the Issuer or any part thereof.
Section 14.5 Waivers.
(a) The Partnership hereby expressly waives (to the extent permitted by
law) notice of the acceptance of this Senior Guarantee and notice of the
existence, renewal, extension or the non-performance, non-payment, or
non-observance on the part of the Issuer of any of the terms, covenants,
conditions and provisions of this Indenture or the Senior Notes or any other
notice whatsoever to or upon the Issuer or the Partnership with respect to the
Indenture Obligations. The Partnership hereby acknowledges communication to it
of the terms of this Indenture and the Senior Notes and all of the provisions
therein contained and consents to and approves the same. The Partnership hereby
expressly waives (to the extent permitted by law) diligence, presentment,
protest and demand for payment.
(b) Without prejudice to any of the rights or recourses which the Trustee
or the Holders may have against the Issuer, the Partnership hereby expressly
waives (to the extent permitted by law) any right to require the Trustee or the
Holders to:
(i) initiate or exhaust any rights, remedies or recourse against the
Issuer, the Partnership or any other Person;
(ii) value, realize upon, or dispose of any Senior Note of the
Issuer or any other Person held by the Trustee or the Holders; or
(iii) initiate or exhaust any other remedy which the Trustee or the
Holders may have in law or equity;
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<PAGE>
before requiring or becoming entitled to demand payment from the Partnership
under this Guarantee.
Section 14.6 The Partnership Remains Obligated in Event the Issuer Is No
Longer Obligated to Discharge Indenture Obligations.
It is the express intention of the Trustee and the Partnership that if for
any reason the Issuer has no legal existence, is or becomes under no legal
obligation to discharge the Indenture Obligations owing to the Trustee or the
Holders by the Issuer or if any of the Indenture Obligations owing by the Issuer
to the Trustee or the Holders becomes irrevocable from the Issuer by operation
of law or for any reason whatsoever, this Senior Guarantee and the covenants,
agreements and obligations of the Partnership contained in this Article Fourteen
shall nevertheless be binding upon the Partnership, as principal debtor, until
such time as all such Indenture Obligations have been paid in full to the
Trustee and all Indenture Obligations owing to the Trustee or the Holders by the
Issuer have been discharged, or such earlier time as Section 4.2 shall apply to
the Senior Notes and the Partnership shall be responsible for the payment
thereof to the Trustee or the Holders upon demand.
Section 14.7 Waiver of Rights.
The Partnership agrees (to the extent permitted by law) that it hereby
waives and will not in any manner whatsoever claim or take the benefit or
advantage of, any rights of reimbursement, exoneration, contribution, indemnity
or subrogation (whether contractual, under Section 509 of Title Eleven of the
United States Code, under common law or otherwise) or any similar rights or
"claims" (as such term is defined under Title Eleven of the United States Code),
against the Issuer or any Subsidiary arising from the existence of, or
performance by, the Partnership under this Senior Guarantee.
Section 14.8 Senior Guarantee Is in Addition to Other Security.
This Senior Guarantee shall be in addition to and not in substitution for
any other guarantees or other security which the Trustee may now or hereafter
hold in respect of the Indenture Obligations owing to the Trustee or the Holders
by the Issuer and (except as may be required by law) the Trustee shall be under
no obligation to marshal in favor of the Partnership any other guarantees or
other security or any moneys or other assets which the Trustee may be entitled
to receive or upon which the Trustee or the Holders may have a claim.
Section 14.9 Release of Security Interests.
Without limiting the generality of the foregoing and except as otherwise
provided in this Indenture, the Partnership hereby consents and agrees, to the
fullest extent permitted by applicable law, that the rights of the Trustee
hereunder, and the liability of the Partnership hereunder, shall not be affected
by any and all releases for any purpose of any Collateral, if any,
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<PAGE>
from the Liens and security interests created by the Senior Partnership Upstream
Note Mortgage and that this Senior Guarantee shall continue to be effective or
be reinstated, as the case may be, if at any time any payment of any of the
Indenture Obligations is rescinded or must otherwise be returned by the Trustee
upon the insolvency, bankruptcy or reorganization of the Issuer or otherwise,
all as though such payment had not been made.
Section 14.10 No Bar to Further Actions.
Except as provided by law, no action or proceeding brought or instituted
under Article Fourteen and this Senior Guarantee and no recovery or judgment in
pursuance thereof shall be a bar or defense (other than a defense of payment) to
any further action or proceeding which may be brought under Article Fourteen and
this Senior Guarantee by reason of any further default or defaults under Article
Fourteen and this Senior Guarantee or in the payment of any of the Indenture
Obligations owing by the Issuer.
Section 14.11 Failure to Exercise Rights Shall Not Operate As a Waiver; No
Suspension of Remedies.
(a) No failure to exercise and no delay in exercising, on the part of the
Trustee or the Holders, any right, power, privilege or remedy under this Article
Fourteen and this Senior Guarantee shall operate as a waiver thereof, nor any
single or partial exercise of any right, power, privilege or remedy preclude any
other or further exercise thereof, or the exercise of any other rights, powers,
privileges or remedies. The rights and remedies herein provided for are
cumulative and not exclusive of any rights or remedies provided in law or
equity.
(b) Nothing contained in this Article Fourteen shall limit the right of
the Trustee or the Holders to take any action to accelerate the maturity of the
Senior Notes pursuant to Article Five or to pursue any rights or remedies
hereunder or under applicable law.
Section 14.12 Successors and Assigns.
All terms, agreements and conditions of this Article Fourteen shall extend
to and be binding upon the Partnership and its successors and permitted assigns
and shall enure to the benefit of and may be enforced by the Trustee and its
successors and assigns; provided, however, that the Partnership may not assign
any of its rights or obligations hereunder other than in accordance with Article
Eight.
Section 14.13 Release of Senior Guarantee.
Concurrently with the payment in full of all of the Indenture Obligations,
the Partnership shall be released from and relieved of its obligations under
this Article Fourteen. Upon the delivery by the Issuer to the Trustee of an
Officers' Certificate and, if requested by the Trustee, an Opinion of Counsel to
the effect that the transaction giving rise to the release of this Senior
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<PAGE>
Guarantee was made by the Issuer in accordance with the provisions of this
Indenture and the Senior Notes, the Trustee shall execute any documents
reasonably required in order to evidence the release of the Partnership from its
obligations under this Senior Guarantee and the TCHI Note Mortgage Documents if
any of the Indenture Obligations are revived and reinstated after the
termination of this Senior Guarantee, then all of the obligations of the
Partnership under this Senior Guarantee shall be revived and reinstated as if
this Senior Guarantee had not been terminated until such time as the Indenture
Obligations are paid in full, and the Partnership shall enter into an amendment
to this Senior Guarantee, reasonably satisfactory to the Trustee, evidencing
such revival and reinstatement.
This Senior Guarantee shall terminate upon a merger or consolidation of
the Partnership with the Issuer, in accordance with Article Eight.
Section 14.14 Execution of Senior Guarantee.
To evidence the Senior Guarantee, the Partnership hereby agrees to execute
a guarantee substantially in the form set forth in Section 2.5, to be endorsed
on each Senior Note authenticated and delivered by the Trustee and that this
Indenture shall be executed on behalf of the Partnership by one of its general
partners or its President or one of its Vice Presidents. The signature of any of
these officers on the Senior Notes may be manual or facsimile.
If an officer whose signature is on this Indenture no longer holds that
office at the time the Trustee authenticates a Senior Note on which this Senior
Guarantee is endorsed, such Senior Guarantee shall be valid nevertheless.
* * * * * *
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
TRUMP'S CASTLE HOTEL & CASINO, INC.,
as Issuer
Attest: /s/ R. Bruce McKee By /s/ Nicholas L. Ribis
---------------------- ------------------------------------
Name: R. Bruce McKee Nicholas L. Ribis
Title: Vice President President and Chief Executive Officer
TRUMP'S CASTLE ASSOCIATES, L.P.
By: TRUMP'S CASTLE HOTEL & CASINO,
INC., its General Partner
Attest: /s/ R. Bruce McKee By /s/ Nicholas L. Ribis
---------------------- ------------------------------------
Name: R. Bruce McKee Nicholas L. Ribis
Title: Vice President President and Chief Executive Officer
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
Attest: /s/ Kathe M. Barrett By /s/ Richard H. Prokosch
---------------------- ------------------------------------
Name: Kathe M. Barrett Name: Richard H. Prokosch
Title: Trust Officer Title: Assistant Vice President
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 15th day of April, 1998, before me personally came Nicholas L.
Ribis, to me known, who, being by me duly sworn, did depose and say that he is
President and Chief Executive Officer of Trump's Castle Hotel & Casino, Inc.,
one of the corporations described in and which executed the above instrument;
that he knows the corporate seal of such corporation; that the seal affixed to
said instrument is such corporate seal; that it was so affixed pursuant to
authority of the Board of Directors of such corporation; and that he signed his
name thereto pursuant to like authority.
(NOTARIAL SEAL)
/s/ Marcus Chioffi
-------------------------------
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on April 15, 1998, before me, the subscriber,
personally appeared Nicholas L. Ribis, the President and Chief Executive Officer
of Trump's Castle Hotel & Casino, Inc., a New Jersey corporation, which is the
general partner of Trump's Castle Associates, L.P., a New Jersey limited
partnership, who, I am satisfied, is the person who has signed the within
instrument on behalf of such entities, and I having first made known to him the
contents thereof he thereupon acknowledged that he signed and delivered the said
instrument in his capacity as aforesaid, and that the within instrument is the
voluntary act and deed of said entities.
(NOTARIAL SEAL)
/s/ Marcus Chioffi
------------------------
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 15th day of April, 1998, before me personally came Richard H.
Prokosch, to me known, who, being by me duly sworn, did depose and say that he
is an Assistant Vice President of U.S. Bank National Association, one of the
entities described in and which executed the above instrument; that he knows the
corporate seal of such entity; that the seal affixed to said instrument is such
corporate seal; that it was so affixed pursuant to authority of the board of
directors of such corporation; and that he signed his name thereto pursuant to
like authority.
(NOTARIAL SEAL)
/s/ Reese M. Heitner
-------------------------
<PAGE>
SCHEDULE I TO TCHI NOTE INDENTURE
OTHER PERMITTED INDEBTEDNESS
DESCRIPTION AMOUNT
----------- ------
NONE $0
<PAGE>
SCHEDULE II TO TCHI NOTE INDENTURE
OTHER PERMITTED INVESTMENTS
DESCRIPTION AMOUNT
----------- ------
NONE $0
Execution Copy
TRUMP'S CASTLE FUNDING, INC., as Issuer
U.S. BANK NATIONAL ASSOCIATION, as Trustee
TRUMP'S CASTLE ASSOCIATES, L.P., as Guarantor
-----------------
INDENTURE
Dated as of April 17, 1998
-----------------
$62,000,000
10 1/4% Senior Secured Notes due 2003
<PAGE>
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION............1
Section 1.1 Definitions...........................................2
Section 1.2 Other Definitions.....................................20
Section 1.3 Compliance Certificates and Opinions..................20
Section 1.4 Form of Documents Delivered to Trustee................21
Section 1.5 Acts of Holders.......................................22
Section 1.6 Notices, etc., to Trustee, the Issuer,
the Partnership, the CCC and the NJDGE................23
Section 1.7 Notice to Holders; Waiver.............................23
Section 1.8 Conflict with Trust Indenture Act.....................24
Section 1.9 Effect of Headings and Table of Contents..............24
Section 1.10 Successors and Assigns................................24
Section 1.11 Separability Clause...................................24
Section 1.12 Benefits of Indenture.................................24
Section 1.13 GOVERNING LAW.........................................25
Section 1.14 Casino Control Act....................................25
Section 1.15 Legal Holidays........................................25
Section 1.16 Schedules.............................................25
Section 1.17 Counterparts..........................................25
ARTICLE 2
FORM OF SENIOR NOTES...............................................25
Section 2.1 Forms Generally.......................................25
Section 2.2 Form of Face of the Senior Notes......................26
Section 2.3 Form of Reverse of the Senior Notes...................29
Section 2.4 Form of Trustee's Certificate of Authentication.......32
Section 2.5 Form of Senior Guarantee..............................32
ARTICLE 3
THE SENIOR NOTES...................................................33
Section 3.1 Title and Terms.......................................33
Section 3.2 Denominations.........................................35
Section 3.3 Execution, Authentication, Delivery and Dating........35
Section 3.4 Temporary Securities..................................36
Section 3.5 Registration, Registration of Transfer and Exchange...36
Section 3.6 Mutilated, Destroyed, Lost and Stolen Senior Notes....38
Section 3.7 Payment of Interest...................................39
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<PAGE>
Section 3.8 Persons Deemed Owners.................................40
Section 3.9 Cancellation..........................................41
Section 3.10 Computation of Interest...............................41
Section 3.11 Non-recourse..........................................41
ARTICLE 4
DEFEASANCE AND COVENANT DEFEASANCE.................................42
Section 4.1 Option to Effect Defeasance or Covenant Defeasance....42
Section 4.2 Defeasance and Discharge..............................42
Section 4.3 Covenant Defeasance...................................43
Section 4.4 Conditions to Defeasance or Covenant Defeasance.......43
Section 4.5 Deposited Money and U.S. Government Obligations
to be Held in Trust; Other Miscellaneous Provisions...45
Section 4.6 Reinstatement.........................................46
ARTICLE 5
REMEDIES...........................................................46
Section 5.1 Events of Default.....................................46
Section 5.2 Acceleration of Maturity; Rescission and Annulment....48
Section 5.3 Collection of Indebtedness and Suits for
Enforcement by Trustee................................50
Section 5.4 Trustee May File Proofs of Claim......................51
Section 5.5 Trustee May Enforce Claims Without Possession
of the Senior Notes...................................51
Section 5.6 Application of Money Collected........................52
Section 5.7 Limitation on Suits...................................52
Section 5.8 Unconditional Right of Holders to Receive
Principal, Premium and Interest.......................53
Section 5.9 Restoration of Rights and Remedies....................53
Section 5.10 Rights and Remedies Cumulative........................53
Section 5.11 Delay or Omission Not Waiver..........................54
Section 5.12 Control by Holders....................................54
Section 5.13 Waiver of Past Defaults...............................54
Section 5.14 Undertaking for Costs.................................55
Section 5.15 Waiver of Stay, Extension or Usury Laws...............55
Section 5.16 Unconditional Right of Holders to
Institute Certain Suits...............................55
Section 5.17 Management of Casino-Hotel............................56
ARTICLE 6
THE TRUSTEE .......................................................56
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Section 6.1 Duties of Trustee and Notice of Defaults..............56
Section 6.2 Certain Rights of Trustee.............................58
Section 6.3 Trustee Not Responsible for Recitals,
Dispositions of Senior Notes or Application
of Proceeds Thereof; etc..............................59
Section 6.4 Trustee and Agents May Hold Senior Notes;
Collections; Etc. ....................................60
Section 6.5 Money Held in Trust...................................60
Section 6.6 Compensation and Indemnification of Trustee
and Its Prior Claim...................................60
Section 6.7 Conflicting Interests.................................61
Section 6.8 Corporate Trustee Required; Eligibility...............61
Section 6.9 Resignation and Removal; Appointment of
Successor Trustee.....................................61
Section 6.10 Acceptance of Appointment by Successor................63
Section 6.11 Merger, Consolidation or Succession to Business.......64
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND ISSUER...................65
Section 7.1 Issuer to Furnish Trustee Names and
Addresses of Holders..................................65
Section 7.2 Disclosure of Names and Addresses of Holders..........65
Section 7.3 Reports by Trustee....................................65
Section 7.4 Reports by the Issuer and the Partnership.............67
ARTICLE 8
CONSOLIDATION, MERGER,CONVEYANCE, TRANSFER OR LEASE................67
Section 8.1 The Issuer or the Partnership May Consolidate,
Merge, etc., Only on Certain Terms....................67
Section 8.2 Successor Substituted.................................70
ARTICLE 9
SUPPLEMENTAL INDENTURES............................................71
Section 9.1 Supplemental Indentures and Agreements without
Consent of Holders....................................71
Section 9.2 Supplemental Indentures and Agreements with
Consent of Holders....................................72
Section 9.3 Execution of Supplemental Indentures and Agreements...73
Section 9.4 Effect of Supplemental Indentures.....................73
Section 9.5 Conformity with Trust Indenture Act...................73
Section 9.6 Reference in Senior Notes to Supplemental Indentures..73
Section 9.7 Record Date...........................................74
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ARTICLE 10
COVENANTS..........................................................74
Section 10.1 Payment of Principal, Premium and Interest...........74
Section 10.2 Maintenance of Office or Agency......................74
Section 10.3 Money for Senior Note Payments to be Held in Trust...75
Section 10.4 Issuer's and Partnership's Existence.................76
Section 10.5 Payment of Taxes and Other Claims....................76
Section 10.6 Maintenance of Properties............................77
Section 10.7 Limitation on Partnership Indebtedness...............77
Section 10.8 Limitation on Liens..................................78
Section 10.9 Limitation on Restricted Payments....................78
Section 10.10 Limitation on Partnership Leases.....................82
Section 10.11 Limitation on Preferred Stock of Subsidiaries
and Subsidiary Distributions.........................82
Section 10.12 Limitation on Payment Restrictions
Affecting Subsidiaries...............................82
Section 10.13 Purchase of Senior Notes upon Change of Control......83
Section 10.14 Limitations on Transactions with Affiliates..........84
Section 10.15 Restriction on Transfer of Assets....................85
Section 10.16 Limitation on Activities and Investments.............85
Section 10.17 Restriction on Payment of Services Fee...............86
Section 10.18 Provision of Financial Statements....................86
Section 10.19 Statement by Officers as to Default..................86
Section 10.20 Waiver of Certain Covenants..........................87
Section 10.21 Mortgage Notes and PIK Notes.........................87
ARTICLE 11
REDEMPTION OF SENIOR NOTES.........................................88
Section 11.1 Senior Notes Redeemed Pursuant to Casino
Control Act..........................................88
Section 11.2 Optional Redemption..................................88
Section 11.3 Senior Notes Redeemed Pursuant to a Total
Taking or Casualty...................................88
Section 11.4 Applicability of Article.............................88
Section 11.5 Notice to Trustee....................................89
Section 11.6 Selection by Trustee of Senior Notes to Be Redeemed..89
Section 11.7 Notice of Redemption.................................89
Section 11.8 Deposit of Redemption Price..........................90
Section 11.9 Senior Notes Payable on Redemption Date..............90
Section 11.10 Senior Notes Redeemed in Part........................91
-5-
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ARTICLE 12
SENIOR NOTE MORTGAGE DOCUMENTS.....................................91
Section 12.1 Senior Note Mortgage Documents.......................91
Section 12.2 Recording, Opinion of Counsel, Etc. .................92
Section 12.3 Release of Collateral................................93
Section 12.4 Trust Indenture Act Requirements.....................93
Section 12.5 Disposition of Certain Collateral without
Requesting Release...................................93
Section 12.6 Suits to Protect the Collateral......................94
Section 12.7 Determinations Relating to Collateral................95
Section 12.8 Impairment of Security Interest......................95
Section 12.9 Release Upon Termination of the Issuer's Obligations.96
Section 12.10 Authorization of Receipt of Funds by the
Trustee Under the Senior Note Mortgage Documents.....96
ARTICLE 13
SATISFACTION AND DISCHARGE.........................................96
Section 13.1 Satisfaction and Discharge of Indenture..............96
Section 13.2 Application of Trust Money...........................97
ARTICLE 14
SENIOR GUARANTEE 98
Section 14.1 Partnership Senior Guarantee.........................98
Section 14.2 Continuing Guarantee; No Right of Set-Off;
Independent Obligation...............................98
Section 14.3 Guarantee Absolute...................................99
Section 14.4 Right to Demand Full Performance.....................101
Section 14.5 Waivers..............................................101
Section 14.6 The Partnership Remains Obligated in Event
the Issuer Is No Longer Obligated to Discharge
Indenture Obligations................................102
Section 14.7 Waiver of Rights.....................................102
Section 14.8 Senior Guarantee Is in Addition to Other Security....103
Section 14.9 Release of Security Interests........................103
Section 14.10 No Bar to Further Actions............................103
Section 14.11 Failure to Exercise Rights Shall Not Operate
As a Waiver; No Suspension of Remedies...............103
Section 14.12 Successors and Assigns...............................104
Section 14.13 Release of Senior Guarantee..........................104
Section 14.14 Execution of Senior Guarantee........................104
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EXHIBIT A Form of Senior Partnership Note
EXHIBIT B Form of Senior Note Mortgage
EXHIBIT C Form of Senior Assignment Agreement
EXHIBIT D Form of Senior Guarantee Mortgage
SCHEDULE I Permitted Indebtedness
SCHEDULE II Permitted Investments
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Reconciliation and tie between Trust
Indenture Act of 1939
and Indenture, dated as of April 17, 1998
Trust Indenture Indenture
Act Section Section
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ss.310(a)(1) ............................. 6.8
(a)(2) ............................. 6.8
(b) ............................. 6.7, 6.9
ss.312(a) ............................. 7.1
(c) ............................. 7.2
ss.314(a) ............................. 7.4
(a)(4) ............................. 10.19
(b) ............................. 12.2
(c)(1) ............................. 1.3
(c)(2) ............................. 1.3
(e) ............................. 1.3
ss.315(b) ............................. 6.1
ss.316(a)(last
sentence)
(a)(1)(A) ............................. 1.1 ("Outstanding")
(a)(1)(A) ............................. 5.2, 5.12
(1)(a)(B) ............................. 5.13
(b) ............................. 5.8
(c) ............................. 9.7
ss.317(a)(1) ............................. 5.3
(a)(2) ............................. 5.4
ss.318(a) ............................. 1.8
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Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
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INDENTURE, dated as of April 17, 1998, among TRUMP'S CASTLE FUNDING, INC.,
a New Jersey corporation (the "Issuer"), as issuer, U.S. BANK NATIONAL
ASSOCIATION, a national banking association ("Trustee"), as trustee, and TRUMP'S
CASTLE ASSOCIATES, L.P., a New Jersey limited partnership (the "Partnership" or
"Guarantor"), as guarantor.
RECITALS OF THE ISSUER AND THE PARTNERSHIP
The Issuer has duly authorized the creation of an issue of up to
$62,000,000 aggregate principal amount of its (a) 10 1/4% Series A Senior
Secured Notes due 2003 (the "Series A Notes") and (b) its 10 1/4% Series B
Senior Secured Notes due 2003 (the "Series B Notes" and collectively with the
Series A Notes, the "Senior Notes") of substantially the tenor and amount
hereinafter set forth, and to provide therefor the Issuer has duly authorized
the execution and delivery of this Indenture.
The Partnership has duly authorized the issuance of a guarantee of the
Senior Notes (the "Senior Guarantee"), of substantially the tenor hereinafter
set forth, and to provide therefor the Partnership has duly authorized the
execution and delivery of this Indenture and the Senior Guarantee.
This Indenture is subject to, and shall be governed by, the provisions of
the Trust Indenture Act of 1939, as amended, that are required to be part of and
to govern indentures qualified under such Trust Indenture Act.
All acts and things necessary have been done to make (i) the Senior Notes,
when executed by the Issuer and authenticated and delivered hereunder and duly
issued by the Issuer, the valid obligations of the Issuer, (ii) the Senior
Guarantee, when executed by the Partnership and delivered hereunder, the valid
obligation of the Partnership and (iii) this Indenture a valid agreement of the
Issuer and the Partnership in accordance with its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Senior
Notes by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Senior Notes, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
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Section 1.1 Definitions.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them
in this Article, and include the plural as well as the singular;
(b) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with GAAP;
(d) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;
(e) "or" is not exclusive; and
(f) all references to $ or dollars shall refer to the lawful currency of
the United States of America.
Certain Definitions
"Acquired Indebtedness" means Indebtedness of a Person (a) existing at the
time such Person becomes a Subsidiary or (b) assumed in connection with the
acquisition of assets from such Person, in each case, other than Indebtedness
incurred in connection with, or in contemplation of, such Person becoming a
Subsidiary or such acquisition. Acquired Indebtedness shall be deemed to be
incurred on the date of the related acquisition of assets from any Person or the
date the acquired Person becomes a Subsidiary.
"Adjusted Consolidated Interest Expense" means, without duplication, for
any period, the sum of (a) the interest expense of the Partnership and its
Consolidated Subsidiaries for such period, on a Consolidated basis, including,
without limitation, (i) amortization of debt discount, (ii) the net cost under
interest rate contracts (including amortization of discounts), (iii) the
interest portion of any deferred payment obligation and (iv) accrued interest
plus (b) the interest component of the Capital Lease Obligations paid, accrued
and/or scheduled to be paid, or accrued by the Partnership and its Consolidated
Subsidiaries during such period, in each case as determined in accordance with
GAAP consistently applied.
"Adjusted Consolidated Net Income (Loss)" means, for any period, the
Consolidated net income (or loss) of the Partnership and its Consolidated
Subsidiaries for such period as determined in accordance with GAAP consistently
applied, adjusted, to the extent included in
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calculating such net income (loss), by excluding (a) all extraordinary gains or
losses (less all fees and expenses relating thereto), (b) the portion of net
income (or loss) of the Partnership and its Consolidated Subsidiaries allocable
to minority interests in unconsolidated Persons to the extent that cash
dividends or distributions have not actually been received by the Partnership or
one of its Consolidated Subsidiaries, (c) net income (or loss) of any Person
combined with the Partnership or any of the Subsidiaries on a "pooling of
interests" basis attributable to any period prior to the date of combination,
(d) any gain or loss, net of taxes, realized upon the termination of any
employee pension benefit plan, (e) net gains or losses (less all fees and
expenses relating thereto) in respect of dispositions of assets other than in
the ordinary course of business, or (f) the net income of any Subsidiary to the
extent that the declaration of dividends or similar distributions by that
Subsidiary of that income is not at the time permitted, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary or its shareholders.
"Affiliate" means, with respect to any specified Person, (a) any other
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person or (b) any other Person that
owns, directly or indirectly, 5% or more of such Person's Capital Stock or
Equity Interest or any officer or director of any such Person or other Person or
with respect to any natural Person, any person having a relationship with such
Person by blood, marriage or adoption not more remote than first cousin. 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 ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Appraised Value" shall have the meaning set forth in Section 1 of the
Senior Note Mortgage.
"Assignment of Leases and Rents and Assignment of Operating Assets" means
collectively (i) the Assignment of Leases and Rents and Assignment of Operating
Assets dated as of the date herof by the Partnership to the Issuer and (ii) the
Assignment of Leases and Rents and Assignment of Operating Assets dated, as of
the date herof, by the Partnership to the Trustee.
"Average Life to Stated Maturity" means, as of the date of determination
with respect to any Indebtedness, the quotient obtained by dividing (a) the sum
of the products of (i) the number of years from the date of determination to the
date or dates of each successive scheduled principal payment of such
Indebtedness multiplied by (ii) the amount of each such principal payment by (b)
the sum of all such principal payments.
"Bankruptcy Law" means Title 11, United States Code, as amended, or any
similar United States federal or state law relating to bankruptcy, insolvency,
receivership, winding-up,
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liquidation, reorganization or relief of debtors or any amendment to, succession
to or change in any such law.
"Board of Directors" means, with respect to the Issuer, the board of
directors of the Issuer or, with respect to the Partnership, the board of
partner representatives, or any duly authorized committee of any such board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Issuer or the Partnership, as the case may be,
to have been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in The City of New York are
authorized or obligated by law or executive order to close.
"Cage Cash" means the sum of $5,000,000 retained for daily operations of
the Casino.
"Capital Lease Obligation" of any Person means any obligation of such
Person and its subsidiaries on a Consolidated basis under any capital lease of
real or personal property which, in accordance with GAAP, has been recorded as a
capitalized lease obligation.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of such Person's
capital stock.
"Casino - Hotel" means the casino and hotel complex currently known as the
"Trump Marina Hotel Casino" in Atlantic City, New Jersey and ancillary
structures, marina and other facilities and all furniture, fixtures and
equipment at any time contained therein, in each case owned by or leased to the
Partnership and covered by the lien of the Senior Note Mortgage.
"Casualty" means any act or occurrence of any kind or nature which results
in damage, loss or destruction to any buildings or improvements on the Premises
and/or Tangible Personal Property (as such terms are defined in Section 1.1 of
the Senior Note Mortgage).
means the New Jersey Casino Control Commission or any successor entity
thereto.
"Certificate of Appraised Value" shall have the meaning set forth in
Section 1.1 of the Senior Note Mortgage.
"Change of Control" means an event as a result of which (a) the Permitted
Holder does not have the right or ability by voting power, contract or otherwise
to elect or designate for election a majority of the Board of Directors of
Trump's Castle Hotel & Casino, Inc. and the
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Board of Partner Representatives of the Partnership or to control the management
of the Partnership; or (b) the Partnership is liquidated or dissolved or adopts
a plan of liquidation or dissolution, provided, however, a Change of Control
shall not be deemed to occur as a result of one or more Public Offerings so long
as (i) the Permitted Holder continues to own beneficially 20% or more of the
voting equity securities of the entity which conducted the Public Offering and
(ii) no other holder beneficially owns a greater percentage of voting securities
of such entity than the Permitted Holder.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means, collectively, all of the property and assets that are
from time to time subject to the Lien of the Senior Note Mortgage.
"Consolidated Fixed Charge Coverage Ratio" means for any period the ratio
of (a) the sum of Adjusted Consolidated Net Income, Adjusted Consolidated
Interest Expense and Consolidated Income Tax Expense, plus, without duplication,
all depreciation, amortization and all other non-cash charges (excluding any
such non-cash charges constituting an extraordinary item of loss or any non-cash
charge which requires an accrual of or a reserve for cash charges for any future
period) in each case, for such period, of the Partnership and its Consolidated
Subsidiaries on a Consolidated basis, all determined in accordance with GAAP
consistently applied to (b) Adjusted Consolidated Interest Expense for such
period.
"Consolidated Income Tax Expense" means for any period the provision for
federal, state, local and foreign income taxes of the Partnership and its
Consolidated Subsidiaries for such period as determined in accordance with GAAP
consistently applied.
"Consolidated Net Worth" of any Person means the Consolidated
stockholders' equity (excluding Redeemable Capital Stock or Redeemable Equity
Interests) of such Person and its Consolidated subsidiaries, as determined in
accordance with GAAP consistently applied.
"Consolidation" means, with respect to any Person, the consolidation of
the accounts of such Person and each of its subsidiaries if and to the extent
the accounts of such Person and each of its subsidiaries would normally be
consolidated with those of such Person, all in accordance with GAAP consistently
applied. The term "Consolidated" shall have a similar meaning.
"Corporate Trust Office" means the office of the Trustee, or its agent, at
which at any particular time its corporate trust business shall be administered,
which office at the date of execution of this Indenture is located at 180 East
Fifth Street, St. Paul, Minnesota 55101.
"CRDA" means the Casino Reinvestment Development Authority or any
successor entity thereto.
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"Default" means any event which is, or after notice or passage of time or
both would be, an Event of Default.
"EBITDA" means, for the relevant accounting period, an amount equal to the
sum of (i) the net income (or loss) of the Partnership for such period
determined in accordance with generally accepted accounting principles,
consistently applied, excluding any extraordinary, unusual or non-recurring
gains (including without limitation those gains arising from dispositions of
assets or from the purchase, redemption or discharge of any indebtedness), and
excluding any extraordinary, unusual or non-recurring losses arising from (A)
transactions or events approved by not less than two of the Noteholder
Representatives (so long as such approval includes an explicit finding that any
such losses arising from such transaction or event are to be so excluded
pursuant to this clause (A)) or (B) the purchase, redemption or discharge of any
indebtedness in respect of the Mortgage Notes or PIK Notes, plus (ii) all
amounts deducted in computing such net income (or loss) in respect of interest
(including the imputed interest portions of rentals under Capitalized Leases),
depreciation, amortization and taxes based upon or measured by income, plus
(iii) other non-cash charges arising from market value adjustments and
adjustments pertaining to contributions of deposits in each case in respect of
CRDA Bonds.
"Equity Interest" of any Person means any shares, interests,
participations or other equivalents (however designated) of such Person in
equity.
"Event of Default" has the meaning specified in Article Five.
"Excess Available Cash" shall be calculated semi-annually on June 30 and
December 31 and means the sum of the Partnership's cash and cash equivalents as
shown on its balance sheet at such date less the sum of (1) the Partnership's
Cage Cash, (2) the Partnership's working capital reserve of $10 million less the
amount, if any, available to the Partnership under the Working Capital Facility,
(3) the aggregate amount required to meet the cash interest payments due on all
Permitted Indebtedness on the next respective interest payment dates, (4)
distributions to be made during the succeeding six month period in respect of
taxes as contemplated by clause (c) of Section 10.9(b)(ix) hereof, and (5) the
cash amounts required to meet the Partnership's Capital Expenditures (as defined
in the Partnership Agreement), CRDA bond payments and other fixed charges
projected during the succeeding six month period.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"F,F&E Financing Agreement" means an agreement which creates a Lien upon
any after-acquired Tangible Personal Property (as defined in the Senior Note
Mortgage) and/or other items constituting Operating Assets (as defined in the
Senior Note Mortgage), which are financed, purchased or leased by the
Partnership.
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"Fair Market Value" means, with respect to any asset or property, the sale
value that would be obtained in an arm's-length transaction between an informed
and willing seller under no compulsion to sell and an informed and willing buyer
under no compulsion to buy and, with respect to any Senior Notes redeemed under
Section 11.1, means (a) the last sales price regular way on the last trading day
prior to the date of determination of such value on the largest national
securities exchange (or, if said security is not listed on a national securities
exchange, on the National Market System of the National Association of
Securities Dealers, Inc. Automated Quotation System ("NASDAQ")) on which such
Senior Notes shall have traded on such trading day, or (b) if no such sales of
such Senior Notes occurred on such trading day, the mean between the "bid" and
"asked" prices on such national securities exchange or as quoted on the National
Market System of NASDAQ, as the case may be, on such last trading day, or (c) if
the Senior Notes are not listed or quoted on any national securities exchange or
the National Market System of NASDAQ, the average of the closing bid and asked
prices on such day in the over-the-counter market as reported by NASDAQ or, if
bid and asked prices for the Senior Notes have not been reported through NASDAQ,
the average of the bid and asked prices on such day as furnished by any New York
Stock Exchange member firm regularly making a market in the Senior Notes,
selected for such purpose by the Issuer, or (d) if none of clauses (a) through
(c) are applicable, the fair market value of such Senior Notes as of the date of
determination as determined in such manner as shall be satisfactory to the
Issuer, which shall be entitled to rely for such purpose on the advice of any
firm of investment bankers or securities dealers having familiarity with the
Senior Notes.
"Gaming Authority" means the CCC, the NJDGE or any other governmental
agency which regulates gaming in a jurisdiction in which the Partnership
conducts gaming activities.
"Generally Accepted Accounting Principles" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied, which
are in effect on the date of this Indenture.
"Guaranteed Debt" of any Person means, without duplication, all
Indebtedness of any other Person referred to in the definition of Indebtedness
contained in this section guaranteed directly or indirectly in any manner by
such Person, or in effect guaranteed directly or indirectly by such Person
through an agreement (a) to pay or purchase such Indebtedness or to advance or
supply funds for the payment or purchase of such Indebtedness, (b) to purchase,
sell or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such
Indebtedness or to assure the holder of such Indebtedness against loss, (c) to
supply funds to, or in any other manner invest in, the debtor (including any
agreement to pay for property or services without requiring that such property
be received or such services be rendered), (d) to maintain working capital or
equity capital of the debtor, or otherwise to maintain the net worth, solvency
or other financial condition of the debtor or (e) otherwise to assure a creditor
against loss; provided that the term "guarantee" shall not include endorsements
for collection or deposit, in either case in the ordinary course of business;
provided further, that the obligations of the Partnership pursuant to the
Services Agreement as in
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effect on the date of this Indenture shall not be deemed to be Guaranteed Debt
of the Partnership.
"Holder" means a Person in whose name a Senior Note is registered in the
Senior Note Register.
"Indebtedness" means, with respect to any Person, without duplication, (a)
all indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services, excluding any trade payables and other accrued
current liabilities arising in the ordinary course of business, but including,
without limitation, all obligations, contingent or otherwise, of such Person in
connection with any letters of credit issued under letter of credit facilities,
acceptance facilities or other similar facilities and in connection with any
agreement to purchase, redeem, exchange, convert or otherwise acquire for value
any Capital Stock or Equity Interest of such Person, or any warrants, rights or
options to acquire such Capital Stock or Equity Interest, now or hereafter
outstanding, (b) all obligations of such Person evidenced by bonds, notes,
debentures or other similar instruments, (c) every obligation of such Person
issued or contracted for as payment in consideration of the purchase by such
Person or an Affiliate of such Person of the Capital Stock or Equity Interest or
substantially all of the assets of another Person or in consideration for the
merger or consolidation with respect to which such Person or an Affiliate of
such Person was a party, (d) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even if the rights and remedies of the seller or lender
under such agreement in the event of default are limited to repossession or sale
of such property), but excluding trade payables and other accrued current
liabilities arising in the ordinary course of business, (e) all obligations
under interest rate contracts of such Person, (f) all Capital Lease Obligations
of such Person, (g) all Indebtedness referred to in clauses (a) through (f)
above of other Persons and all dividends of other Persons, the payment of which
are secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien upon or in property
(including, without limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for the payment
of such Indebtedness, (h) all Guaranteed Debt of such Person, (i) all Redeemable
Capital Stock or Redeemable Equity Interests valued at the greater of its
voluntary or involuntary maximum fixed repurchase price plus accrued and unpaid
dividends, and (j) any amendment, supplement, modification, deferral, renewal,
extension or refunding of any liability of the types referred to in clauses (a)
through (i) above. For purposes hereof, the "maximum fixed repurchase price" of
any Redeemable Capital Stock or Redeemable Equity Interest which does not have a
fixed repurchase price shall be calculated in accordance with the terms of such
Redeemable Capital Stock or Redeemable Equity Interest as if such Redeemable
Capital Stock or Redeemable Equity Interest were purchased on any date on which
Indebtedness shall be required to be determined pursuant to this Indenture, and
if such price is based upon, or measured by, the Fair Market Value of such
Redeemable Capital Stock or Redeemable Equity Interest, such Fair Market Value
to be determined in good faith by the board of directors of the issuer (or
managing general partner of the issuer) of such Redeemable Capital Stock or
Redeemable Equity Interest.
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"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Indenture Obligations" means the obligations of the Issuer, the
Partnership and any other obligor under this Indenture or under the Senior
Notes, to pay principal of, premium, if any, and interest when due and payable,
and all other amounts due or to become due under or in connection with this
Indenture, the Senior Notes and the performance of all other obligations to the
Trustee and the Holders under this Indenture, the Senior Notes and the Senior
Note Mortgage, according to the terms thereof.
"Intercreditor Agreement" means the Intercreditor Agreement of even date
herewith among the Issuer, TCHI, the Partnership, the Trustee, the trustee under
the TCHI Note Indenture, the trustee under the Mortgage Note Indenture, and the
trustee under the PIK Note Indenture.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Senior Notes.
"Investments" means, with respect to any Person, directly or indirectly,
any advance, loan or other extension of credit or capital contribution to (by
means of any transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any purchase or other
acquisition by such Person of any Capital Stock, Equity Interest, bonds, notes,
debentures or other securities or assets issued or owned by, any other Person.
"Issuer" means Trump's Castle Funding, Inc., a corporation incorporated
under the laws of the State of New Jersey or any other obligor on the Senior
Notes (other than the Partnership), including any successor Person to Trump's
Castle Funding, Inc. in accordance with Article Eight hereof.
"Issuer Request" or "Issuer Order" means a written request or order signed
in the name of the Issuer by any one of its Chairman of the Board, its Vice
Chairman, its President or a Vice President, and by any one of its Treasurer, an
Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to
the Trustee.
"Legal Requirements" has the meaning set forth in Section 1.1 of the
Senior Note Mortgage.
"Lien" means any mortgage, charge, pledge, lien (statutory or otherwise),
privilege, security interest, hypothecation or other encumbrance upon or with
respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired.
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"Marina Lease" means the lease agreement made September 1, 1990 between
the State of New Jersey, as Landlord, and the Partnership, as tenant, as
amended, respecting property known as the Senator Frank S. Farley State Marina,
Atlantic City, New Jersey, being designated as a portion of Block B-4, Lot 11 on
the tax map of the City of Atlantic City, Atlantic County, New Jersey, together
with all amendments, restatements, extensions and renewals thereof.
"Maturity" when used with respect to any Senior Note means the date on
which the principal of such Senior Note becomes due and payable as therein
provided or as provided in this Indenture, whether at Stated Maturity, Change of
Control Purchase Date or the Redemption Date and whether by declaration of
acceleration, Change of Control Offer, call for redemption or otherwise.
"Mortgage Debt" means any Indebtedness secured by Liens (other than
involuntary Liens) on any portion of the Collateral.
"Mortgage Documents" shall have the meaning set forth in the Mortgage Note
Indenture.
"Mortgage Notes" means the 11-3/4% Mortgage Notes due 2003 issued by the
Issuer.
"Mortgage Note Indenture" means that certain indenture among the Issuer,
as issuer, the Partnership, as guarantor, and First Bank National Association
(now known as U.S. Bank National Association), as trustee, dated as of December
28, 1993, relating to the Issuer's 11 3/4% Mortgage Notes due 2003 as it may
from time to time be supplemented or amended by one or more indentures
supplemental thereto.
"NASDAQ" is defined under the definition of "Fair Market Value."
"Net Cash Proceeds" of an issuance means the cash proceeds of such
issuance, net of attorney's fees, accountant's fees, brokerage, consultant,
underwriting and other fees and expenses actually incurred in connection with
such issuance, sale, conversion or exchange and net of taxes paid or payable as
a result thereof.
"NJDGE" means the New Jersey Division of Gaming Enforcement or any
successor entity thereto.
"Noteholder Representatives" shall have the meaning set forth in the
Partnership Agreement.
"Note Mortgage" shall have the meaning set forth in the Mortgage Note
Indenture.
"Officers' Certificate" means a certificate signed by a general partner or
the President or a Vice President, and by the Treasurer, Assistant Treasurer,
Secretary or an Assistant Secretary, of the Issuer or the Partnership and
delivered to the Trustee.
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"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Issuer or the Trustee.
"Outstanding" when used with respect to Senior Notes means, as of the date
of determination, all Senior Notes theretofore authenticated and delivered under
this Indenture, except:
(a) Senior Notes theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation;
(b) Senior Notes, or portions thereof, for whose payment or
redemption money in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent (other than the Issuer) in trust or
set aside and segregated in trust by the Issuer (if the Issuer shall act
as its own Paying Agent) for the Holders of such Senior Notes; provided
that if such Senior Notes are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and Senior Notes, except to the
extent provided in Sections 4.2 and 4.3, with respect to which the Issuer
has effected defeasance or covenant defeasance as provided in Article
Four; and
(c) Senior Notes in exchange for or in lieu of which other Senior
Notes have been authenticated and delivered pursuant to this Indenture,
other than any such Senior Notes in respect of which there shall have been
presented to the Trustee proof satisfactory to it that such Senior Notes
are held by a bona fide purchaser in whose hands the Senior Notes are
valid obligations of the Issuer;
provided, however, that in determining whether the Holders of the
requisite principal amount of Outstanding Senior Notes have given any
request, demand, authorization, direction, notice, consent or waiver
hereunder, Senior Notes owned by the Issuer, the Partnership, or any other
obligor upon the Senior Notes or any Affiliate of the Issuer, the
Partnership, any guarantor or such other obligor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Senior Notes
which the Trustee knows to be so owned shall be so disregarded. Senior
Notes so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee
the pledgor's right so to act with respect to such Senior Notes and that
the pledgee is not the Issuer, the Partnership or any other obligor upon
the Senior Notes or any Affiliate of the Issuer, the Partnership or such
other obligor.
"Outstanding Amount" of any Indebtedness at any time means the principal
amount outstanding of such Indebtedness at such time, unless such Indebtedness
was issued at a discount, in which case the "Outstanding Amount" of such
Indebtedness means the original issue
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price of such Indebtedness plus the accretion to such time of the original issue
discount, determined in accordance with Generally Accepted Accounting
Principles.
"Pari Passu Indebtedness" means any Indebtedness of the Partnership that
is Pari Passu in right of payment to the Senior Guarantee.
"Partnership" means Trump's Castle Associates, L.P., a New Jersey limited
partnership, and any successor Person to Trump's Castle Associates, L.P. in
accordance with Article Eight hereof.
"Partnership Agreement" means the Partnership's Third Amended and Restated
Partnership Agreement dated as of October 7, 1996 as in effect on the date of
this Indenture.
"Partnership Note" means the Partnership Note dated as of December 28,
1993 in the principal amount of $242,141,304 made by the Partnership in favor of
the Issuer, evidencing the proceeds of the Mortgage Notes.
"Paying Agent" means any Person authorized by the Issuer to pay the
principal, premium, if any, or interest on any Senior Notes on behalf of the
Issuer.
"Permit" means any license, franchise, authorization, statement of
compliance, certificate of operation, certificate of occupancy and permit
required for the lawful ownership, occupancy, operation and use of all or a
material portion of the Collateral whether held by the Partnership or any other
Person (which may be temporary or permanent) (including, without limitation,
those required for the use of the Casino Hotel as a licensed casino facility),
in accordance with all applicable Legal Requirements.
"Permitted Holder" means Donald J. Trump and any corporation or other
entity that is controlled by Donald J. Trump.
"Permitted Indebtedness" means the following:
(a) Indebtedness of the Partnership and the Issuer pursuant to this
Indenture and the Senior Note Mortgage Documents;
(b) Indebtedness of the Partnership pursuant to a Working Capital Facility
(including without limitation, pursuant to the TCHI Note Indenture, the TCHI
Notes (and the Partnership's guarantee thereof), the Senior Partnership Upstream
Note, and the TCHI Note Mortgage Documents);
(c) Indebtedness of the Partnership and the Issuer pursuant to the
Mortgage Note Indenture and the Mortgage Documents;
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(d) Indebtedness of the Partnership and the Issuer pursuant to the PIK
Note Indenture and the Pledge Agreement (as defined in the PIK Note Indenture);
(e) Indebtedness of the Partnership outstanding on the date of this
Indenture and listed on Schedule I hereto;
(f) Indebtedness of the Partnership or any Wholly-owned Subsidiary to any
one or the other of them;
(g) Indebtedness of the Partnership or any Subsidiary represented by F,F&E
Financing Agreements; provided, however, that the aggregate principal amount of
Indebtedness permitted by this clause (g) shall not exceed at any one time
outstanding (i) $2,000,000 or (ii) $25,000,000 following the time at which the
Partnership shall have achieved EBITDA for any period of four consecutive fiscal
quarters in an amount not less than $45,000,000.
(h) Indebtedness in respect of Capital Lease Obligations or secured
purchase money security interests of the Partnership or any Subsidiary, in
either case not created by an F, F&E Financing Agreement; provided, however,
that the aggregate principal amount of all such Capital Lease Obligations
permitted by this clause (h) shall not exceed at any one time outstanding (i)
$10,000,000 or (ii) $15,000,000 following the time at which the Partnership
shall have achieved EBITDA for any period of four consecutive fiscal quarters in
an amount not less than $60,000,000 and provided, further, that the aggregate
principal amount of all such Indebtedness secured by purchase money security
interests shall not exceed at any one time outstanding $10,000,000; and
(i) any renewals, extensions, substitutions, refundings, refinancings or
replacements of any Indebtedness described in clauses (a) through (h) of this
definition of "Permitted Indebtedness," including any successive renewals,
extensions, substitutions, refundings, refinancings or replacements so long as
the aggregate principal amount of Indebtedness represented thereby does not
exceed the principal amount of such Indebtedness being renewed, extended,
substituted, refunded, refinanced or replaced (or, if such Indebtedness provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration thereof, such lesser amount as of the date of
determination) plus accrued interest thereon, plus, in the case of refinancings,
the amount of any premium or other payment required to be paid under the terms
of the instrument governing such Indebtedness or the amount of any premium
reasonably determined by the Partnership as necessary to accomplish such
refinancing by means of a tender offer or privately negotiated purchase and, in
each case, actually paid, plus the amount of expenses of the Partnership
incurred in connection with such refinancing and such renewal, extension,
substitution, refinancing or replacement does not reduce the Average Life to
Stated Maturity or the final Stated Maturity of such Indebtedness.
"Permitted Investment" means (a) Investments in any of the Senior Notes,
TCHI Notes, PIK Notes or Mortgage Notes; (b) Temporary Cash Investments; (c)
intercompany notes to the
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extent permitted under the definition of "Permitted Indebtedness"; and (d) any
Investments in existence on the date of this Indenture and listed on Schedule II
to this Indenture.
"Permitted Leases" means the following:
(i) the Marina Lease;
(ii) any Capital Lease Obligation permitted by clause (i) of the
definition of "Permitted Indebtedness"; and
(iii) Leases other than Capital Lease Obligations and the Marina Lease;
provided, however, that the aggregate fixed rental payments paid or accrued for
any period of four consecutive fiscal quarters commencing after the date hereof
under all such leases (including payments required to be made by the Lessee in
respect of taxes and insurance, whether or not denominated as rent), shall not
exceed for such period (a) $2,000,000 or (b) $7,500,000 following the times at
which the Partnership shall have achieved EBITDA for any period of four
consecutive fiscal quarters in an amount not less than $45,000,000.
"Permitted Liens" means:
(a) any Lien existing as of the date of this Indenture under the Senior
Note Mortgage, the Senior Guarantee Mortgage, the Mortgage Documents (including
without limitation, "Permitted Encumbrances" and "Restricted Encumbrances", both
as defined in the Note Mortgage), the Pledge Agreement (as defined in the PIK
Note Indenture), "Permitted Encumbrances" hereafter arising and permitted under
the Senior Note Mortgage Documents, and any Lien hereafter arising under a
Working Capital Facility (including without limitation, any Lien arising under
the TCHI Mortgage Documents and "Permitted Encumbrances", as defined in the TCHI
Note Mortgage);
(b) Capital Lease Obligations and purchase money liens included in
Permitted Indebtedness;
(c) the Lien in favor of the Trustee pursuant to Section 6.6 of this
Indenture, the Lien in favor of the trustee pursuant to Section 6.6 of the
Mortgage Note Indenture, the Lien in favor of the trustee pursuant to Section
6.6 of the TCHI Note Indenture, and the Lien in favor of the trustee pursuant to
Section 6.6 of the PIK Note Indenture;
(d) any Lien arising by reason of (i) any judgment, decree or order of any
court, so long as such Lien is adequately bonded and any appropriate legal
proceedings which may have been duly initiated for the review of such judgment,
decree or order shall not have been finally terminated or the period within
which such proceedings may be initiated shall not have expired; (ii) security
for payment of workmen's compensation or other insurance; (iii) good faith
deposits in connection with tenders, leases, contracts (other than contracts for
the payment of money);
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and (iv) deposits to secure public or statutory obligations, or in lieu of
surety or appeal bonds; and
(e) any Lien arising by reason of any renewal, extension, substitution,
refunding, refinancing or replacement of any Indebtedness permitted by clause
(i) of the definition of Permitted Indebtedness.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PIK Note Indenture" means that certain indenture among the Issuer, as
issuer, the Partnership, as guarantor, and First Bank National Association (now
known as U.S. Bank National Association), as trustee, dated as of December 28,
1993, relating to the Issuer's PIK Notes as it may from time to time be
supplemented or amended by one or more indentures supplemental thereto.
"PIK Notes" means the Subordinated Pay-in-Kind Notes due 2005 issued by
the Issuer in an initial aggregate principal amount of $52,066,000 plus the
aggregate principal amount of PIK Notes issued as payment of interest thereon.
"Predecessor Senior Note" of any particular Senior Note means every
previous Senior Note evidencing all or a portion of the same debt as that
evidenced by such particular Senior Note; and, for the purposes of this
definition, any Senior Note authenticated and delivered under Section 3.6 in
exchange for a mutilated Senior Note or in lieu of a lost, destroyed or stolen
Senior Note shall be deemed to evidence the same debt as the mutilated, lost,
destroyed or stolen Senior Note.
"Preferred Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's preferred or preference stock whether now outstanding, or issued after
the date of this Indenture, and including, without limitation, all classes and
series of preferred or preference stock.
"Public Offering" shall mean a registered public offering of a direct or
indirect equity interest in the Issuer.
"Qualified Capital Stock" of any Person means any and all Capital Stock of
such Person other than Redeemable Capital Stock.
"Qualified Equity Interest" of any Person means any Equity Interests of
such Person other than Redeemable Equity Interests.
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"Redeemable Capital Stock" means any Capital Stock that, either by its
terms, by the terms of any security into which it is convertible or exchangeable
or otherwise, is or upon the happening of an event (other than the
disqualification of the holder thereof by the CCC) or passage of time would be,
required to be redeemed prior to any Stated Maturity of the principal of the
Senior Notes or is redeemable at the option of the holder thereof at any time
prior to any such Stated Maturity, or is convertible into or exchangeable for
debt securities at any time prior to any such Stated Maturity at the option of
the holder thereof.
"Redeemable Equity Interest" means any Equity Interest that, either by its
terms, by the terms of any security into which it is convertible or exchangeable
or otherwise, is or upon the happening of an event (other than the
disqualification of the holder thereof by the CCC) or passage of time would be,
required to be redeemed prior to any Stated Maturity of the principal of the
Senior Notes or is redeemable at the option of the holder thereof at any time
prior to any such Stated Maturity, or is convertible into or exchangeable for
debt securities at any time prior to any such Stated Maturity at the option of
the holder thereof.
"Redemption Date" when used with respect to any Senior Note to be redeemed
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price" when used with respect to any Senior Note to be
redeemed means the price at which it is to be redeemed pursuant to this
Indenture.
"Registrable Series A Notes" means the Series A Notes upon original
issuance thereof, and at all times subsequent thereto, until, in the case of any
such Series A Note, (A) a Registration Statement with respect to such Series A
Note has been declared effective under the Securities Act and such Series A Note
has been disposed of in accordance with such Registration Statement; (B) such
Series A Note is distributed to the public pursuant to Rule 144 (or any
successor provisions) promulgated under the Securities Act; (C) such Series A
Note has been otherwise transferred and new certificates for them not bearing a
legend restricting further transfer shall have been delivered by the Issuer; or
(D) such Series A Note ceases to be outstanding.
"Registration Rights Agreement" means the registration rights agreement of
even date herewith between the Issuer, the Partnership, TCHI, certain original
purchasers of the Series A Notes and certain original purchasers of TCHI Notes.
"Regular Record Date" for the interest payable on any Interest Payment
Date means April 15 or October 15 (whether or not a Business Day) next preceding
such Interest Payment Date.
"Responsible Officer" when used with respect to the Trustee means any
officer assigned to the Corporate Trust Office or any agent of the Trustee
appointed hereunder, including any vice president, assistant vice president,
assistant secretary, or any other officer or assistant
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officer of the Trustee or the agent of the Trustee appointed hereunder to whom
any corporate trust matter is referred because of his or her knowledge of and
familiarity with the particular subject.
"Restoration" shall have the meaning set forth in Section 1.1 of the
Senior Note Mortgage.
"SEC" means the Securities and Exchange Commission, as from time to time
constituted, created under the Exchange Act, or if at any time after the
execution of this Indenture such SEC is not existing and performing the duties
now assigned to it under the Trust Indenture Act, then the body performing such
duties at such time.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Assignment Agreement" means the Senior Assignment Agreement
between the Issuer and the Trustee dated as of the date hereof, the form of
which is attached hereto as Exhibit C, providing for the assignment of the
Senior Partnership Note and the Senior Note Mortgage to the Trustee by the
Issuer and acknowledgment thereof by the Guarantor.
"Senior Guarantee", means the guarantee by the Partnership of the Issuer's
obligations under the Senior Note Indenture pursuant to the guarantee included
herein.
"Senior Guarantee Mortgage", means the Indenture of Mortgage and Security
Agreement, dated as of the date hereof, between the Trustee, as mortgagee, and
the Partnership, as mortgagor, a copy of which is attached hereto as Exhibit D.
"Senior Note Indenture", means this indenture, relating to the Issuer's
Senior Notes.
"Senior Note Mortgage", means the Indenture of Mortgage and Security
Agreement, dated as of the date hereof, between the Issuer, as mortgagee, and
the Partnership, as mortgagor, a copy of which is attached hereto as Exhibit B,
securing the Senior Partnership Note.
"Senior Note Mortgage Documents" means (i) the Senior Partnership Note,
(ii) the Senior Guarantee, (iii) the Senior Note Mortgage, (iv) the Senior
Guarantee Mortgage, (v) the Senior Assignment Agreement, (vi) the Intercreditor
Agreement, (vi) the Assignment of Leases and Rents and the Assignment of
Operating Assets and (vii) any other security document to which the Partnership,
the Issuer or the Trustee is a party which is executed and delivered pursuant to
or in connection with the foregoing documents, as each may be amended,
unsecured, extended, substituted, refinanced, replaced, extended or otherwise
modified from time to time in accordance with the provisions of this Senior Note
Indenture and the Senior Note Mortgage Documents.
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"Senior Note Register" and "Senior Note Registrar" have the respective
meanings specified in Section 3.5.
"Senior Notes", means the Issuer's 10 1/4% Senior Secured Notes due 2003
issued pursuant to this Indenture in the aggregate original principal amount of
$62,000,000.
"Senior Partnership Note" means the Note dated as of the date hereof in
the principal amount of $62,000,000 made by the Partnership in favor of the
Issuer, evidencing the proceeds of the Senior Notes, and pledged to the Trustee.
"Senior Partnership Upstream Note" means the Note, dated the date hereof
in the principal amount of $5,000,000 made by the Partnership in favor of TCHI,
evidencing the proceeds of the TCHI Notes, and pledged to U.S. Bank National
Association, as trustee under the TCHI Note Indenture.
"Series A Notes" and "Series B Notes", have the meanings specified in the
first recital of this Indenture.
"Services Agreement" means that certain services agreement, dated as of
December 28, 1993 between the Partnership and Trump Casinos II, Inc. relating to
the provision of advertising and other consulting services to the Partnership.
"Services Fee" means, for any period, the amount of the fee payable by the
Partnership under the Services Agreement for such period.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.7.
"Stated Maturity" when used with respect to any Indebtedness or any
installment of interest thereon means the dates specified in such Indebtedness
as the fixed date on which the principal of such Indebtedness or such
installment of interest is due and payable.
"Subordinated Indebtedness" means Indebtedness of the Partnership
subordinated in right of payment to the Senior Guarantee.
"Subsidiary" means any Person a majority of the equity ownership or the
Voting Stock of which is at the time owned, directly or indirectly, by the
Partnership or by one or more other Subsidiaries, or by the Partnership and one
or more other Subsidiaries.
"Taking" means the acquisition or condemnation by eminent domain of the
whole or any part of the Premises (as such term is defined in Section 1.1 of the
Senior Note Mortgage), by a competent authority, for any public or quasi-public
use or purpose.
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"TCHI" means Trump's Castle Hotel & Casino, Inc., a New Jersey
corporation.
"TCHI Note Indenture" means the Indenture, dated as of the date hereof, by
and between TCHI, as issuer, the Partnership, as guarantor, and U.S. Bank
National Association, as trustee thereunder, with respect to the TCHI Notes.
"TCHI Note Mortgage" shall mean the "Senior Partnership Upstream Note
Mortgage", as such term is defined in the TCHI Note Indenture.
"TCHI Note Mortgage Documents"shall have the meaning set forth in the TCHI
Note Indenture.
"TCHI Notes" means TCHI's 10 1/4% Senior Secured Notes due 2003 issued in
an original principal amount of $5,000,000 evidencing indebtedness of the TCHI
under the Working Capital Facility.
"Temporary Cash Investments" means (a) any evidence of Indebtedness,
maturing not more than one year after the date of acquisition, issued by the
United States of America, or an instrumentality or agency thereof and guaranteed
fully as to principal, premium, if any, and interest by the United States of
America, (b) any certificate of deposit, maturing not more than one year after
the date of acquisition, issued by, or time deposit of, a commercial banking
institution that is a member of the Federal Reserve System and that has combined
capital and surplus and undivided profits of not less than $300,000,000, whose
debt has a rating, at the time as of which any investment therein is made, of
"P-1" (or higher) according to Moody's Investors Service, Inc. or any successor
rating agency, or "A-1" (or higher) according to Standard & Poor's Corporation
or any successor rating agency, (c) commercial paper, maturing not more than one
year after the date of acquisition, issued by a corporation (other than an
Affiliate or subsidiary of the Partnership) organized and existing under the
laws of the United States of America with a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to Moody's Investors
Service, Inc. or any successor rating agency, or "A-1" (or higher) according to
Standard & Poor's Corporation or any successor rating agency, and (d) any money
market deposit accounts issued or offered by a domestic commercial bank having
capital and surplus in excess of $300,000,000.
"Total Taking or Casualty" means a Taking or Casualty with respect to
which, pursuant to the provisions of the Senior Note Mortgage, any proceeds
resulting from such Taking or Casualty are to be used to pay amounts due under
the Senior Notes and the Senior Note Mortgage and not for purposes of
Restoration.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
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"Trustee" means the Person named as the "Trustee" in the first paragraph
of this instrument, until a successor trustee shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Trustee" shall mean
such successor trustee.
"Voting Stock" means stock of the class or classes pursuant to which the
holders thereof have the general voting power under ordinary circumstances to
elect at least a majority of the board of directors, managers or trustees of a
corporation (irrespective of whether or not at the time stock of any other class
or classes shall have or might have voting power by reason of the happening of
any contingency).
"Wholly-owned Subsidiary" means a Subsidiary all the Capital Stock of
which is owned by the Partnership or by one or more Wholly-owned Subsidiaries or
by the Partnership and one or more Wholly-owned Subsidiaries; provided, however,
that the Issuer shall not be considered a Wholly-owned Subsidiary of the
Guarantor.
"Working Capital Facility" means one or more lending agreements or note
purchase agreements between the Partnership and responsible financing sources,
pursuant to which the Partnership may incur Indebtedness to meet its working
capital requirements in an aggregate principal amount at any one time
outstanding not to exceed $10,000,000 (including without limitation the note
purchase agreement with respect to TCHI Notes).
Section 1.2 Other Definitions.
Defined in
Term Section
- ---- -------
"Act" 1.5(a)
"Change of Control Offer"" 10.13
"Change of Control Purchase Date" 10.13
"Change of Control Purchase Price" 10.13
"covenant defeasance" 4.3
"Defaulted Interest" 3.7
"defeasance" 4.2
"Defeased Senior Notes" 4.1
"incorporated provision" 1.8
"Restricted Payment" 10.9
"Surviving Entity" 8.1
U.S. Government Obligations" 4.4
Section 1.3 Compliance Certificates and Opinions.
Upon any application or request by the Issuer or the Partnership to the
Trustee to take any action under any provision of this Indenture, the Issuer,
the Partnership and any other
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obligor on the Senior Notes shall furnish to the Trustee an Officers'
Certificate stating that all conditions precedent, if any, provided for in this
Indenture (including any covenant compliance with which constitutes a condition
precedent) relating to the proposed action have been complied with, and an
Opinion of Counsel to the effect that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that, in the case
of any such application or request as to which the furnishing of any
certificates and/or opinions is specifically required by any provision of this
Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every Officers' Certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(a) a statement to the effect that each individual or firm signing such
certificate or opinion has read such covenant or condition and the definitions
herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement to the effect that, in the opinion of each such individual
or firm, he or it has made such examination or investigation as is necessary to
enable him or it to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such individual or
such firm, such condition or covenant has been complied with.
Section 1.4 Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Issuer, the Partnership or
any other obligor of the Senior Notes may be based, insofar as it relates to
legal matters, upon a certificate or opinion of, or representations by, counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to the matters
upon which his certificate or opinion is based are erroneous. Any certificate or
opinion of such an officer or of counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Issuer, the Partnership or other obligor of the
Senior Notes with respect to such factual matters and which contains a statement
to the effect that the information with respect to such factual matters is in
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the possession of the Issuer, the Partnership, or other obligor of the Senior
Notes, unless such officer or counsel knows, or in the exercise of reasonable
care should know, that the certificate or opinion or representations with
respect to such matters are erroneous. Opinions of Counsel required to be
delivered to the Trustee may have qualifications customary for opinions of the
type required and counsel delivering such opinions of Counsel may rely on
certificates of the Issuer, the Partnership or government or other officials
customary for opinions of the type required, including certificates certifying
as to matters of fact, including assertions as to compliance with various
financial covenants.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.5 Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is herein expressly required, to the Issuer. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and conclusive in favor of the Trustee and the Issuer, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any reasonable manner which the Trustee
deems sufficient.
(c) The ownership of the Senior Notes shall be proved by the Senior Note
Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Senior Note shall bind every future Holder
of the Senior Notes or the Holder of every Senior Note issued upon the transfer
thereof or in exchange therefor or in lieu thereof, in respect of anything done,
suffered or omitted to be done by the Trustee, any Paying Agent or the Issuer in
reliance thereon, whether or not notation of such action is made upon such
Senior Note.
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Section 1.6 Notices, etc., to Trustee, the Issuer, the Partnership, the
CCC and the NJDGE.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of the Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with:
(a) the Trustee by any Holder or by the Issuer or the Partnership shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if made, given, furnished or filed, in writing, to or with the Trustee
at 180 East Fifth Street, St. Paul, Minnesota 55101, Attention: Corporate Trust
Department, or at any other address previously furnished in writing to the
Holders, the Issuer or the Partnership by the Trustee;
(b) the Issuer or the Partnership shall be sufficient for every purpose
(except as provided in Section 5.1(b) hereunder) if in writing and mailed,
first-class postage prepaid or delivered by recognized overnight courier, to the
Issuer or the Partnership addressed to it at Brigantine Boulevard and Huron
Avenue, Atlantic City, New Jersey 08401, Attention: Chief Financial Officer, or
at any other address previously furnished in writing to the Trustee by the
Issuer or the Partnership, as the case may be;
(c) the CCC shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if made, given, furnished or filed, in
writing, to or with the CCC at Tennessee Avenue and The Boardwalk, Arcade
Building, Atlantic City, New Jersey 08401; or
(d) the NJDGE shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if made, given, furnished or filed, in
writing to or with the NJDGE at Hughes Justice Complex, CN-047, Trenton, New
Jersey 08625.
Section 1.7 Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Senior Note Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Any notice when mailed to a Holder in the
aforesaid manner shall be conclusively deemed to have been received by such
Holder whether or not actually received by such Holder. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing
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shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason
of any other cause, it shall be impracticable to mail notice of any event as
required by any provision of this Indenture, then any method of giving such
notice as shall be reasonably satisfactory to the Trustee shall be deemed to be
a sufficient giving of such notice.
Section 1.8 Conflict with Trust Indenture Act.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 3.10 to 3.18,
inclusive, of the Trust Indenture Act, or conflicts with any provision (an
"incorporated provision") required by or deemed to be included in this Indenture
by operation of such Sections of the Trust Indenture Act, such imposed duties or
incorporated provision shall control. If any provision of this Indenture
modifies or excludes any provision of the Trust Indenture Act that may be so
modified or excluded, the latter provision shall be deemed to apply to this
Indenture as so modified or excluded, as the case may be.
Section 1.9 Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 1.10 Successors and Assigns.
All covenants and agreements in this Indenture by the Issuer and the
Partnership shall bind their successors and assigns, whether so expressed or
not.
Section 1.11 Separability Clause.
In case any provision in this Indenture or in the Senior Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 1.12 Benefits of Indenture.
Nothing in this Indenture or in the Senior Notes, express or implied, shall give
to any Person (other than the parties hereto and their successors hereunder, any
Paying Agent and the Holders) any benefit or any legal or equitable right,
remedy or claim under this Indenture.
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Section 1.13 GOVERNING LAW.
THIS INDENTURE, THE SENIOR NOTES AND THE SENIOR GUARANTEE SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
(WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF).
Section 1.14 Casino Control Act.
Each of the provisions of this Indenture is subject to and shall be
enforced in compliance with the provisions of the New Jersey Casino Control Act,
unless such provisions are in conflict with the Trust Indenture Act in which
case the Trust Indenture Act shall control.
Section 1.15 Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Senior Note shall not be a Business Day, then (notwithstanding
any other provision of this Indenture or of the Senior Notes) payment of
interest or principal or, premium, if any, need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity and no interest shall accrue with respect to such payment for the
period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, to the next succeeding Business Day.
Section 1.16 Schedules.
All schedules attached hereto are by this reference made a part hereof
with the same effect as if herein set forth in full.
Section 1.17 Counterparts.
This Indenture may be executed in any number of counterparts, each of
which shall be an original; but such counterparts shall together constitute but
one and the same instrument.
ARTICLE 2
FORM OF SENIOR NOTES
Section 2.1 Forms Generally.
The Senior Notes and the Trustee's certificate of authentication shall be
in substantially the forms set forth in this Article, with such appropriate
insertions, omissions, substitutions and
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other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange, any organizational document or governing instrument or any
applicable law, including the federal securities laws, or as may, consistently
herewith, be determined by the officers executing such Senior Notes, as
evidenced by their execution of the Senior Notes. Any portion of the text of any
Senior Note may be set forth on the reverse thereof, with an appropriate
reference thereto on the face of the Senior Note.
The definitive Senior Notes shall be printed, lithographed or engraved or
produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Senior
Notes may be listed, all as determined by the officers executing such Senior
Notes, as evidenced by their execution of such Senior Notes.
Section 2.2 Form of Face of the Senior Notes.
The form of the face of the Senior Notes shall be substantially as
follows:
TRUMP'S CASTLE FUNDING, INC.
[If Series A Notes, then insert --
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM AND IN ANY EVENT MAY BE SOLD OR OTHERWISE
TRANSFERRED ONLY IN ACCORDANCE WITH THE INDENTURE, COPIES OF WHICH ARE AVAILABLE
FOR INSPECTION AT THE CORPORATE TRUST OFFICE OF THE TRUSTEE. THE EXEMPTION
PROVIDED BY RULE 144A UNDER THE SECURITIES ACT MAY BE AVAILABLE TO PERMIT SALE
OR TRANSFER OF THIS SECURITY TO QUALIFIED INSTITUTIONAL BUYERS (WITHIN THE
MEANING OF RULE 144A) WITHOUT REGISTRATION.
EACH HOLDER OF THIS SECURITY REPRESENTS TO THE ISSUER THAT (A) SUCH HOLDER
WILL NOT SELL OR OTHERWISE TRANSFER THIS SECURITY (WITHOUT CONSENT OF THE
ISSUER) PRIOR TO TWO YEARS FROM THE LATER OF APRIL 17, 1998 OR THE DATE ON WHICH
THIS SECURITY WAS LAST HELD BY AN AFFILIATE OF THE ISSUER OTHER THAN (I) TO A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION COMPLYING WITH RULE 144A, (II) TO
A NON-U.S.
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PERSON IN A TRANSACTION COMPLYING WITH REGULATION S UNDER THE SECURITIES ACT,
(III) FOLLOWING ONE YEAR FROM SUCH TIME, IN A TRANSACTION COMPLYING WITH RULE
144 UNDER THE SECURITIES ACT OR (IV) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT (IT BEING UNDERSTOOD THAT AS A
CONDITION TO THE REGISTRATION OF TRANSFER OF ANY SECURITIES, THE ISSUER OR THE
TRUSTEE MAY IN CIRCUMSTANCES EITHER OF THEM BELIEVES APPROPRIATE, REQUIRE
EVIDENCE AS TO COMPLIANCE WITH ANY SUCH EXEMPTION) AND THAT (B) THE HOLDER WILL,
AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY
FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.]
[If Series A Notes, then insert -- 10 1/4% Series A Senior Secured Note
due 2003]
[If Series B Notes, then insert -- 10 1/4% Senior Secured Note due 2003]
No. ____________ $______________
TRUMP'S CASTLE FUNDING, INC., a New Jersey corporation (herein called the
"Issuer," which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
_____________ or registered assigns, the principal sum of ___________ United
States dollars on April 30 , 2003 at the office or agency of the Issuer referred
to below, and to pay interest thereon semiannually on April 30 and October 31 of
each year commencing on October 31, 1998, or if any such day is not a Business
Day, on the next succeeding Business Day (each an "Interest Payment Date") from
the most recent Interest Payment Date on which interest has been paid (or from
the date hereof if no interest has been paid) at the rate of 10 1/4% per annum
until the principal hereof is paid or duly provided for.
So long as this Senior Note constitutes a Registrable Series A Note (as
defined in the Indenture), the Holder hereof is entitled to certain liquidated
damages provided for in Section 4 of the Registration Rights Agreement in the
event, as more fully described therein, that, and so long as, the Issuer fails
to timely implement its commitment to register the Senior Notes under the
Securities Act (as defined in the Indenture).
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Senior Note (or one or more Predecessor Senior Notes) is
registered at the close of business on the Regular Record Date for such
interest, which shall be April 15 or October 15 (whether or not a Business Day),
as the case may be, next preceding such Interest Payment Date. Any such interest
not so paid, or duly provided for, and interest on such defaulted interest at
the interest
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rate borne by the Senior Notes, to the extent lawful, shall forthwith cease to
be payable to the Holder on such Regular Record Date, and may be paid to the
Person in whose name this Senior Note (or one or more Predecessor Senior Notes)
is registered at the close of business on a Special Record Date for the payment
of such defaulted interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Senior Notes not less than ten days prior to such Special
Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Senior Notes may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture.
Payment of the principal of, premium, if any, and interest on this Senior
Note will be made at the office or agency of the Issuer maintained for that
purpose in The City of New York, or at such other office or agency of the Issuer
as may be maintained for such purpose, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that payment of interest may be
made at the option of the Issuer by check mailed to the address of the Person
entitled thereto as such address shall appear on the Senior Note Register.
Interest shall be computed on the basis of a 360-day year of twelve 30-day
months.
This Senior Note is one of the Senior Notes issued and to be issued from
time to time under and in accordance with, the Indenture, all equally secured by
an assignment to the Trustee by the Issuer of a promissory note made by Trump's
Castle Associates, L.P., and of an Indenture of Mortgage and Security Agreement,
dated as of even date with the Indenture referred to herein, (hereinafter as
amended and supplemented the "Senior Note Mortgage"), to which Senior Note
Mortgage reference is made for a description of the property mortgaged and
pledged, the return and extent of the security, and the other provisions
thereof.
Reference is hereby made to the further provisions of this Senior Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee or by the authenticating agent appointed as provided in the
Indenture by manual signature, this Senior Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by the manual or facsimile signature of its authorized officers and its
corporate seal to be affixed or reproduced hereon.
Dated: TRUMP'S CASTLE FUNDING, INC.
Attest:__________________ By______________________________
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Name:
Title:
(SEAL)
Section 2.3 Form of Reverse of the Senior Notes
The form of the reverse of the Senior Notes shall be substantially as
follows:
This Senior Note is one of a duly authorized issue of Senior Notes of the
Issuer designated as its [If Series A Notes, then insert - 10 1/4% Series A
Senior Secured Notes due 2003 (the "Series A Notes")] [If Series B Notes, then
insert - 10 1/4% Senior Secured Notes due 2003 (the "Series B Notes")] issued
under an Indenture, dated as of April 17, 1998 (herein called the "Indenture"),
between the Issuer, U.S. Bank National Association, a national banking
association, as trustee (herein called the "Trustee," which term includes any
successor trustee under the Indenture) and Trump's Castle Associates, L.P., a
New Jersey limited partnership (the "Partnership"), as guarantor [If Series A
Notes, then insert - , together with the 10 1/4% Senior Secured Notes due 2003
of the Issuer (the "Series B Notes", and collectively with the Series A Notes,
the "Senior Notes")] [If Series B Notes, then insert - , together with the 10
1/4% Series A Senior Secured Notes due 2003 of the Issuer (the "Series A Notes,"
and collectively with the Series B Notes, the "Senior Notes")]. The Senior Notes
are limited in aggregate principal amount of up to $62,000,000. Reference is
hereby made to the Indenture and all indentures supplemental thereto for a
statement of the respective rights, limitations of rights, duties, obligations
and immunities thereunder of the Issuer, the Trustee, the Partnership, other
obligors thereunder and the Holders of the Senior Notes, and of the terms upon
which the Senior Notes are, and are to be, authenticated and delivered.
If the Issuer or the Partnership is served with notice of the
disqualification of any Holder under N.J.S.A. ss. 5:12-105(d) by the CCC, such
Holder will be prohibited under N.J.S.A. ss. 5:12-105(e) from (a) receiving
interest on the Senior Notes held by such Holder, (b) exercising directly or
through any trustee or nominee, any right conferred on such Senior Notes and (c)
receiving any remuneration in any form from any company licensed by the CCC
(including the Issuer, the Partnership and the Trustee) for services rendered or
otherwise.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness on this Senior Note and (b) certain restrictive covenants
and related Defaults and Events of Default, in each case upon compliance with
certain conditions set forth therein.
In the event of a Total Taking or Casualty, the Issuer or the Partnership
shall, within 60 days after receipt of any condemnation or insurance proceeds,
but in all events within one year after the occurrence of such Total Taking or
Casualty, redeem the Senior Notes at 100% of the principal amount thereof, in
each case, together with accrued and unpaid interest through the Redemption
Date, all as provided in the Indenture.
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Notwithstanding the foregoing, each Holder by accepting a Senior Note
agrees that if the CCC does not waive the qualification requirement as to the
Holder (whether the record owner or beneficial owner) of this Senior Note and
requires that the Holder be qualified under the New Jersey Casino Control Act,
then, in such event, the Holder must qualify under such Act. If the Holder does
not so qualify, the Holder must dispose of its interest in this Senior Note,
within 30 days (or within such earlier date as the CCC may require) after the
Issuer's receipt of notice of such finding, or the Issuer may redeem this Senior
Note at the lower of the Outstanding Amount and the Fair Market Value of this
Senior Note, without premium, all as provided in the Indenture.
In the case of any redemption of Senior Notes, interest installments whose
Stated Maturity is on or prior to the Redemption Date will be payable to the
Holders of such Senior Notes (or one or more Predecessor Senior Notes), of
record at the close of business on the relevant Record Date referred to on the
face hereof. Senior Notes (or portions thereof) for whose redemption and payment
provision is made in accordance with the Indenture shall cease to bear interest
from and after the date fixed for redemption.
In the event of redemption of this Senior Note in part only, a new Senior
Note or Senior Notes for the unredeemed portion hereof shall be issued in the
name of the Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, there may be
declared due and payable in the manner and with the effect provided in the
Indenture the principal of this Senior Note, plus all accrued and unpaid
interest to and including the date this Senior Note is paid.
If a Change of Control occurs at any time, each Holder shall have the
right to require that the Issuer repurchase such Holder's Senior Notes in whole
or in part in integral multiples of $1,000 at a purchase price in cash in an
amount equal to 101% of the principal amount thereof plus accrued and unpaid
interest (including any Defaulted Interest), if any, to the date of purchase.
The Indenture permits, with certain exceptions as therein provided,
amendments and modifications of the rights and obligations of the Issuer and the
Partnership and the rights of the Holders under the Indenture and the Senior
Note Mortgage Documents at any time by the Issuer, the Partnership, and the
Trustee with the consent of the Holders of not less than a majority in aggregate
principal amount of the Senior Notes at the time Outstanding. The Indenture also
contains provisions permitting the Holders of specified percentages in aggregate
principal amount of the Senior Notes at the time Outstanding, on behalf of the
Holders of all the Senior Notes, to waive compliance by the Issuer or the
Partnership with certain provisions of the Indenture and certain past Defaults
under the Indenture and their consequences. Any such consent or waiver by or on
behalf of the Holder of this Senior Note shall be conclusive and binding upon
such Holder and upon all future Holders of this Senior Note and of any Senior
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Note issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof whether or not notation of such consent or waiver is made upon this
Senior Note.
No reference herein to the Indenture or to the Senior Note Mortgage
Documents and no provision of this Senior Note or of the Indenture or of the
Senior Note Mortgage Documents shall alter or impair the obligation of the
Issuer, the Partnership or any other obligor under the Senior Notes (in the
event the Partnership or any such obligor is obligated to make payments in
respect of the Senior Notes), which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Senior Note at the times,
place, and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Senior Note is registrable on the Senior Note
Register of the Issuer, upon surrender of this Senior Note for registration of
transfer at the office or agency of the Issuer maintained for such purpose in
The City of New York or at such other office or agency of the Issuer as may be
maintained for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Issuer and the Senior Note
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Senior Notes, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The Senior Notes are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, such Senior
Notes are exchangeable for a like aggregate principal amount of Senior Notes of
a different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any registration of transfer or
exchange or redemption of Senior Notes, but the Issuer may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to and at the time of due presentment of this Senior Note for
registration of transfer, the Issuer, the Trustee and any agent of the Issuer or
the Trustee may treat the Person in whose name this Senior Note is registered as
the owner hereof for all purposes, whether or not this Senior Note is overdue,
and neither the Issuer, the Trustee nor any agent shall be affected by notice to
the contrary.
Notwithstanding anything herein (including the Senior Guarantee) or in any
other agreement, document, certificate, instrument, statement or omission
referred to below to the contrary, the Partnership and the Issuer are liable
hereunder only to the extent of the assets of the Partnership and the Issuer and
no other person or entity, including, but not limited to, any partner, officer,
committee or committee member of the Partnership or any partner therein or of
any Affiliate of the Partnership, or any incorporator, officer, director or
shareholder of the
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Issuer, or any Affiliate or controlling Person or entity of any of the
foregoing, or any agent, employee or lender of any of the foregoing, or any
successor, personal representative, heir or assign of any of the foregoing, in
each case past, present, or as they may exist in the future, shall be liable in
any respect (including without limitation the breach of any representation,
warranty, covenant, agreement, condition or indemnification or contribution
undertaking contained herein or therein) under, in connection with, arising out
of, or relating to this Senior Note, the Indenture, the Senior Note Mortgage
Documents or any other agreement, document, certificate, instrument or statement
(oral or written) related to, executed or to be executed, delivered or to be
delivered, or made or to be made, or any omission made or to be made, in
connection with any of the foregoing or any of the transactions contemplated in
any such agreement, document, certificate, instrument or statement.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer or disposition of all or substantially all of the properties and assets
of the Issuer or the Partnership in accordance with the Indenture, subject to
the terms and conditions of the Indenture, the successor Person to such
transaction shall become the obligor or guarantor on this Senior Note and the
Senior Note Mortgage Documents and the Issuer or Partnership, as the case may
be, shall be discharged from all obligations and covenants under this Senior
Note, the Senior Note Mortgage Documents and the Indenture.
All terms used in this Senior Note which are defined in the Indenture and
not otherwise defined herein shall have the meanings assigned to them in the
Indenture.
Section 2.4 Form of Trustee's Certificate of Authentication
The form of certificate of authentication shall be substantially as
follows:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
This is one of the Senior Notes referred to in the within-mentioned
Indenture.
U.S. BANK NATIONAL ASSOCIATION,
As Trustee
Dated:__________________ By__________________________________
Authorized Signatory
Section 2.5 Form of Senior Guarantee.
The form of Senior Guarantee shall be set forth on the Senior Notes
substantially as follows:
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SENIOR GUARANTEE BY
TRUMP'S CASTLE ASSOCIATES, L.P.
For value received, Trump's Castle Associates, L.P., a New Jersey limited
partnership, hereby unconditionally guarantees to the Holder of this Senior Note
the payment of principal of, premium, if any, and interest on this Senior Note
in the amounts and at the time when due and interest on the overdue principal
and interest, if any, of this Senior Note, if lawful, and the payment or
performance of all other obligations of the Issuer under the Indenture or the
Senior Notes, to the Holder of this Senior Note and the Trustee, all in
accordance with and subject to the terms and limitations of this Senior Note and
Article Fourteen of the Indenture. This Senior Guarantee is secured by a certain
Indenture of Mortgage and Security Agreement, dated of even date with the
Indenture referred to in this Senior Note, between Trump's Castle Associates,
L.P. as mortgagor, and U.S. Bank National Association, Trustee, as mortgagee, to
which reference is hereby made for a full statement of its terms and conditions.
This Senior Guarantee is without recourse to the partners of the Partnership and
will not become effective until the Trustee duly executes the certificate of
authentication on this Senior Note.
Dated:__________________________ TRUMP'S CASTLE ASSOCIATES, L.P.
By Trump's Castle Hotel & Casino,
Inc., its General Partner
Attest:_________________________ By______________________________
Authorized Signature Title:
(SEAL)
ARTICLE 3
THE SENIOR NOTES
Section 3.1 Title and Terms.
The aggregate principal amount of Senior Notes which may be authenticated
and delivered under this Indenture is limited to $62,000,000, except for Senior
Notes authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Senior Notes pursuant to Section 3.3, 3.4,
3.5, 3.6, 9.6 or 10.13. The Senior Notes are being issued in two series, the
Series A Notes and the Series B Notes.
The Series A Notes are initially being issued pursuant to an exemption
from registration under the Securities Act. After the initial issuance date of
the Series A Notes, Series B Notes will be issued in exchange for an equal
principal amount of outstanding Series A Notes (i) pursuant to the Registered
Exchange Offer (as defined in the Registration Rights Agreement), (ii) if a
registration statement covering the resale of Series B Notes has been declared
effective,
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in which case the Series A Notes will be exchanged for Series B Notes
immediately prior to the disposition of Series B Notes pursuant to the
registration statement, (iii) at the request of the Holder of the Series A
Notes, immediately prior to the disposition of such Senior Notes pursuant to
Rule 144, if the Holder of the Series A Notes delivers to the Trustee an Opinion
of Counsel stating that as a result of such disposition the Senior Notes being
disposed of will no longer be Restricted Securities or (iv) if the Holder of the
Series A Notes delivers to the Trustee an Opinion of Counsel stating that the
Series A Notes are no longer Restricted Securities.
Upon any such exchange the Series A Notes shall be cancelled in accordance
with Section 3.9 and shall no longer be deemed Outstanding for any purpose.
Subject to Section 3.6 hereof, in no event shall the aggregate principal amount
of both of the Series A Notes and Series B Notes Outstanding exceed $62,000,000.
The Series A Notes shall be known and designated as the " 10 1/4% Series A
Senior Secured Notes due 2003" of the Issuer and the Series B Notes shall be
known and designated as the " 10 1/4% Series B Senior Secured Notes due 2003" of
the Issuer. The Senior Notes shall be known and designated as the " 10 1/4%
Senior Secured Notes due 2003" of the Issuer. The Stated Maturity of the Senior
Notes shall be April 30, 2003. The Senior Notes, shall bear interest on the
principal amount thereof at the rate of 10 1/4% per annum (subject, in the case
of the Series A Notes, to certain liquidation damages provided for in the
Registration Rights Agreement), payable semiannually on April 30 and October 31
in each year, commencing October 31, 1998, until the principal thereof is paid
or duly provided for. Interest on any overdue principal, interest (to the extent
lawful) or premium, if any, shall be payable on demand.
The principal of, premium, if any, and interest on Senior Notes shall be
payable at the office or agency of the Issuer maintained for such purpose in The
City of New York, or at such other office or agency of the Issuer as may be
maintained for such purpose; provided, however, that at the option of the Issuer
interest may be paid by check mailed to addresses of the Persons entitled
thereto as such addresses shall appear on the Senior Note Register.
The Senior Notes shall be redeemable as provided in Article Eleven.
At the election of the Issuer and the Partnership, the entire indebtedness
on the Senior Notes or certain of the Issuer's or the Partnership's obligations
and covenants and certain Events of Default thereunder may be defeased as
provided in Article Four.
The Senior Notes shall be secured as provided in Article Twelve.
If the Issuer or the Partnership is served with notice of the
disqualification of any Holder under N.J.S.A. ss.5:12-105(d) by the CCC, such
Holder will be prohibited under N.J.S.A. ss. 5:12-105(e) from (a) receiving
interest on the Senior Notes held by such Holder, (b) exercising directly or
through any trustee or nominee, any right conferred on such Senior Notes and
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(c) receiving any remuneration in any form from any company licensed by the CCC
(including the Issuer, the Partnership and the Trustee) for services rendered or
otherwise.
Section 3.2 Denominations.
The Senior Notes shall be issuable only in registered form without coupons
and only in denominations of $1,000 and in integral multiples thereof.
Section 3.3 Execution, Authentication, Delivery and Dating.
The Senior Notes shall be executed on behalf of the Issuer by its Chairman
of the Board of Directors, Vice Chairman, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Senior Notes may be manual or facsimile.
Senior Notes bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Senior Notes or did not
hold such offices on the date of such Senior Notes.
At any time and from time to time after the execution and delivery of this
Indenture, the Issuer may deliver Senior Notes executed by the Issuer to the
Trustee for authentication, together with an Issuer Order for the authentication
and delivery of such Senior Notes; and the Trustee in accordance with such
Issuer Order shall authenticate and deliver such Senior Notes as provided in
this Indenture and not otherwise.
Each Senior Note shall be dated the date of its authentication.
No Senior Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Senior Note a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Senior Note shall be conclusive evidence, and the only
evidence, that such Senior Note has been duly authenticated and delivered
hereunder.
In case the Issuer or the Partnership, pursuant to Article Eight, shall be
consolidated, merged with or into any other Person or shall sell, convey,
assign, transfer or lease substantially all of its properties and assets to any
Person, and the successor Person resulting from such consolidation, or surviving
such merger, or into which the Issuer or the Partnership shall have been
consolidated or merged, or the Person which shall have received a conveyance,
transfer or lease as aforesaid, shall have executed an indenture supplemental
hereto with the Trustee pursuant to Article Eight, any of the Senior Notes
authenticated or delivered prior to such consolidation, merger, conveyance,
transfer or lease may, from time to time, at the request of
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the successor Person, be exchanged for other Senior Notes executed in the name
of the successor Person with such changes in phraseology and form as may be
appropriate, but otherwise in substance of like tenor as the Senior Notes
surrendered for such exchange and of like principal amount; and the Trustee,
upon the request of the successor Person, shall authenticate and deliver Senior
Notes as specified in such Request for the purpose of such exchange. If Senior
Notes shall at any time be authenticated and delivered in any new name of a
successor Person pursuant to this Section in exchange or substitution for or
upon registration of transfer of any Senior Notes, such successor Person, at the
option of the Holders but without expense to them, shall provide for the
exchange of all Senior Notes at the time Outstanding for Senior Notes
authenticated and delivered in such new name.
The Trustee may appoint an authenticating agent acceptable to the Issuer
to authenticate Senior Notes on behalf of the Trustee. Unless limited by the
terms of such appointment, an authenticating agent may authenticate Senior Notes
whenever the Trustee may do so except upon original issuance. Each reference in
this Indenture to authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as any Senior Note Registrar
or Paying Agent to deal with the Issuer and its Affiliates.
Section 3.4 Temporary Securities.
Pending the preparation of definitive Senior Notes, the Issuer may
execute, and upon order of the Issuer the Trustee shall authenticate and
deliver, temporary Senior Notes which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Senior Notes in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Senior Notes may determine, as
conclusively evidenced by their execution of such temporary Senior Notes.
If temporary Senior Notes are issued, the Issuer will cause definitive
Senior Notes to be prepared without unreasonable delay. After the preparation of
definitive Senior Notes, the temporary Senior Notes shall be exchangeable for
definitive Senior Notes upon surrender of the temporary Senior Notes at the
office or agency of the Issuer designated for such purpose pursuant to Section
10.2, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Senior Notes the Issuer shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Senior Notes of authorized denominations. Until so exchanged the
temporary Senior Notes shall in all respects be entitled to the same benefits
under this Indenture as definitive Senior Notes.
Section 3.5 Registration, Registration of Transfer and Exchange.
The Issuer shall cause to be kept at the Corporate Trust Office of the
Trustee, or such other office as the Trustee may designate, a register (the
register maintained in such office and in any other office or agency designated
pursuant to Section 10.2 being herein sometimes
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referred to as the "Senior Note Register") in which, subject to such reasonable
regulations as the Senior Note Registrar may prescribe, the Issuer shall provide
for the registration of Senior Notes and of transfers of Senior Notes. The
Trustee is hereby initially appointed "Senior Note Registrar" for the purpose of
registering Senior Notes and transfers of Senior Notes as herein provided.
Upon surrender for registration of transfer of any Senior Note in
certificated form at the office or agency of the Issuer designated pursuant to
Section 10.2, the Issuer shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Senior Notes of any authorized denomination or denominations, of a like
aggregate principal amount.
At the option of the Holder, Senior Notes may be exchanged for other
Senior Notes of any authorized denomination or denominations, of a like
aggregate principal amount, upon surrender of the Senior Notes to be exchanged
at such office or agency. Whenever any such Senior Notes are so surrendered for
exchange, the Issuer shall execute, and the Trustee shall authenticate and
deliver, the Senior Notes which the Holder making the exchange is entitled to
receive.
All Senior Notes issued upon any registration of transfer or exchange of
Senior Notes shall be the valid obligations of the Issuer, evidencing the same
Indebtedness, and entitled to the same benefits under this Indenture, as the
Senior Notes surrendered upon such registration of transfer or exchange.
Every Senior Note presented or surrendered for registration of transfer,
or for exchange or redemption shall (if so required by the Issuer or the
Trustee) be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Issuer and the Senior Note Registrar, duly executed
by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made to a Holder for any registration of
transfer or exchange or redemption of Senior Notes, but the Issuer may require
payment of a sum sufficient to pay all documentary, stamp or similar issue or
transfer taxes or other governmental charges that may be imposed in connection
with any registration of transfer or exchange of Senior Notes, other than
exchanges pursuant to Section 3.3, 3.4, 9.6, 10.13, or 11.10 not involving any
transfer.
The Issuer shall not be required (a) to issue, register the transfer of or
exchange any Senior Note during a period beginning at the opening of business 15
days before the mailing of a notice of redemption of the Senior Notes selected
for redemption under Section 11.6 and ending at the close of business on the day
of such mailing, or (b) to register the transfer of or exchange any Senior Note
so selected for redemption in whole or in part, except the unredeemed portion of
Senior Notes being redeemed in part.
All Series A Notes issued hereunder shall bear the following legend:
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THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM AND IN ANY EVENT MAY BE SOLD OR OTHERWISE
TRANSFERRED ONLY IN ACCORDANCE WITH THE INDENTURE, COPIES OF WHICH ARE AVAILABLE
FOR INSPECTION AT THE CORPORATE TRUST OFFICE OF THE TRUSTEE. THE EXEMPTION
PROVIDED BY RULE 144A UNDER THE SECURITIES ACT MAY BE AVAILABLE TO PERMIT SALE
OR TRANSFER OF THIS SECURITY TO QUALIFIED INSTITUTIONAL BUYERS (WITHIN THE
MEANING OF RULE 144A) WITH REGISTRATION.
EACH HOLDER OF THIS SECURITY REPRESENTS TO THE ISSUER THAT (A) SUCH HOLDER
WILL NOT SELL OR OTHERWISE TRANSFER THIS SECURITY (WITHOUT CONSENT OF THIS
ISSUER) PRIOR TO TWO YEARS FROM THE LATER OF APRIL 17, 1998 OR THE DATE ON WHICH
THIS SECURITY WAS LAST HELD BY AN AFFILIATE OF THE ISSUER OTHER THAN (I) TO A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION COMPLYING WITH RULE 144A, (II) TO
A NON-U.S. PERSON IN A TRANSACTION COMPLYING WITH REGULATION S UNDER THE
SECURITIES ACT, (III) FOLLOWING ONE YEAR FROM SUCH TIME, IN A TRANSACTION
COMPLYING WITH RULE 144 UNDER THE SECURITIES ACT OR (IV) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT (IT BEING
UNDERSTOOD THAT AS A CONDITION TO THE REGISTRATION OF TRANSFER OF ANY
SECURITIES, THE ISSUER OR THE TRUSTEE MAY IN CIRCUMSTANCES EITHER OF THEM
BELIEVES APPROPRIATE, REQUIRE EVIDENCE AS TO COMPLIANCE WITH ANY SUCH EXEMPTION)
AND THAT (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO NOTIFY
ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN
(A) ABOVE.
Each certificate evidencing a Series A Note (and all Senior Notes issued
in exchange therefor or substitution thereof), until such time as the same is no
longer a Series A Note, shall bear a legend in substantially the form set forth
on the Forms of Face of Security set forth in Section 2.2 hereof. Prior to any
transfer or exchange of a legended Series A Note for a Series B Note, the Issuer
shall deliver an Officer's Certificate to the Trustee directing it to transfer
or exchange such Security for another or unlegended Note.
Section 3.6 Mutilated, Destroyed, Lost and Stolen Senior Notes.
If (a) any mutilated Senior Note is surrendered to the Trustee, or (b) the
Issuer and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Senior Note, and there is delivered to the
Issuer and the Trustee, such security or indemnity, in each case, as may be
required by them to save each of them harmless, then, in the absence of notice
to the
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Issuer or the Trustee that such Senior Note has been acquired by a bona fide
purchaser, the Issuer shall execute and upon its written request the Trustee
shall authenticate and deliver, in exchange for any such mutilated Senior Note
or in lieu of any such destroyed, lost or stolen Senior Note, a replacement
Senior Note of like tenor and principal amount, bearing a number not
contemporaneously Outstanding.
In case any such mutilated, destroyed, lost or stolen Senior Note has
become or is about to become due and payable, the Issuer in its discretion may,
instead of issuing a replacement Senior Note, pay such Senior Note.
Upon the issuance of any replacement Senior Notes under this Section, the
Issuer may require the payment of a sum sufficient to pay all documentary, stamp
or similar issue or transfer taxes or other governmental charges that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every replacement Senior Note issued pursuant to this Section in lieu of
any destroyed, lost or stolen Senior Note shall constitute an original
additional contractual obligation of the Issuer, the Partnership and any other
obligor under the Senior Notes, whether or not the destroyed, lost or stolen
Senior Note shall be at any time enforceable by anyone, and shall be entitled to
all benefits of this Indenture equally and proportionately with any and all
other Senior Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Senior Notes.
Section 3.7 Payment of Interest.
Interest on any Senior Note which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Senior Note (or one or more Predecessor Senior Notes) is
registered at the close of business on the Regular Record Date for such
interest.
Any interest on any Senior Note which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date and interest on such
defaulted interest at the then applicable interest rate borne by the Senior
Notes, to the extent lawful (such defaulted interest and interest thereon herein
collectively called "Defaulted Interest") shall forthwith cease to be payable to
the Holder on the Regular Record Date; and such Defaulted Interest may be paid
by the Issuer, at its election in each case, as provided in Subsection (a) or
(b) below:
(a) The Issuer may elect to make payment of any Defaulted Interest to the
Persons in whose names the Senior Notes (or their respective Predecessor Senior
Notes) are registered at the close of business on a Special Record Date for the
payment of such Defaulted Interest, which
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shall be fixed in the following manner. The Issuer shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each Senior
Note and the date of the proposed payment, and at the same time the Issuer shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this Subsection
provided. Thereupon the Trustee shall fix a Special Record Date for the payment
of such Defaulted Interest which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less than 10 days
after the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Issuer in writing of such Special Record Date.
In the name and at the expense of the Issuer, the Trustee shall cause notice of
the proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each Holder at his
address as it appears in the Senior Note Register, not less than 10 days prior
to such Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the Senior Notes
(or their respective Predecessor Senior Notes) are registered on such Special
Record Date and shall no longer be payable pursuant to the following Subsection
(b).
(b) The Issuer may make payment to the Persons in whose name the Senior
Notes are registered at the close of business on the Special Record Date of any
Defaulted Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Senior Notes may be listed,
and upon such notice as may be required by such exchange, unless, after written
notice given by the Issuer to the Trustee of the proposed payment pursuant to
this Subsection, such manner of payment shall not be deemed practicable by the
Trustee (acting reasonably). The Trustee shall give prompt written notice to the
Issuer of any such determination.
Subject to the foregoing provisions of this Section, each Senior Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Senior Note shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Senior Note.
Section 3.8 Persons Deemed Owners.
Prior to and at the time of due presentment for registration of transfer,
the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
Person in whose name any Senior Note is registered as the owner of such Senior
Note for the purpose of receiving payment of principal of, premium, if any, and
(subject to Section 3.7) interest on such Senior Note and for all other purposes
whatsoever, whether or not such Senior Note is overdue, and neither the Issuer,
the Trustee nor any agent of the Issuer or the Trustee shall be affected by
notice to the contrary.
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Section 3.9 Cancellation.
All Senior Notes surrendered for payment, purchase, redemption or
registration of transfer or exchange shall be delivered to the Trustee and, if
not already cancelled, shall be promptly cancelled by it. The Issuer and the
Partnership may at any time deliver to the Trustee for cancellation any Senior
Notes previously authenticated and delivered hereunder which the Issuer or the
Partnership may have acquired in any manner whatsoever, and all Senior Notes so
delivered shall be promptly cancelled by the Trustee. No Senior Notes shall be
authenticated in lieu of or in exchange for any Senior Notes cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Senior Notes held by the Trustee shall be destroyed and certification
of their destruction delivered to the Issuer unless by an Issuer Order the
Issuer shall direct that the cancelled Senior Notes be returned to it. The
Trustee shall provide the Issuer a list of all Senior Notes that have been
cancelled from time to time as requested by the Issuer.
Section 3.10 Computation of Interest.
Interest on the Senior Notes shall be computed on the basis of a 360-day
year of twelve 30-day months.
Section 3.11 Non-recourse.
Notwithstanding anything herein (including the Senior Guarantee) or in any
other agreement, document, certificate, instrument, statement or omission
referred to below to the contrary, the Issuer and the Partnership are liable
hereunder and under the Senior Notes only to the extent of the assets of the
Issuer and the Partnership and the interest of the Issuer in the Senior Notes
and no other person or entity, including, but not limited to, any partner,
officer, committee or committee member of the Partnership or any partner therein
or of any Affiliate of the Partnership, or any incorporator, officer, director
or shareholder of the Issuer, or any Affiliate or controlling Person or entity
of any of the foregoing, or any agent, employee or lender of any of the
foregoing, or any successor, personal representative, heir or assign of any of
the foregoing, in each case past, present, or as they may exist in the future,
shall be liable in any respect (including without limitation the breach of any
representation, warranty, covenant, agreement, condition or indemnification or
contribution undertaking contained herein or therein) under, in connection with,
arising out of, or relating to this Indenture or any other agreement, document,
certificate, instrument or statement (oral or written) related to, executed or
to be executed, delivered or to be delivered, or made or to be made, or any
omission made or to be made, in connection with any of the foregoing or any of
the transactions contemplated in any such agreement, document, certificate,
instrument or statement. Notwithstanding the foregoing, the Holders preserve any
personal claims they may have for fraud, liabilities under the Securities Act,
and other liabilities that cannot be waived under applicable federal and state
laws in connection with the purchase of the Senior Notes; provided, however,
that such conduct shall not constitute an Event of Default under this Indenture,
the Senior Notes or the Senior Note
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Mortgage or any document executed in conjunction therewith or otherwise related
thereto. Any agreement, document, certificate, statement or other instrument to
be executed simultaneously with, in connection with, arising out of or relating
to this Indenture, the Senior Notes or any other agreement, document,
certificate, statement or instrument referred to above, or any agreement,
document, certificate, statement or instrument contemplated hereby shall contain
language mutatis mutandis to this paragraph and, if such language is omitted,
shall be deemed to contain such language.
ARTICLE 4
DEFEASANCE AND COVENANT DEFEASANCE
Section 4.1 Option to Effect Defeasance or Covenant Defeasance.
The Issuer or the Partnership may, at their option, by Board Resolution,
at any time, with respect to the Senior Notes, elect to have either Section 4.2
or Section 4.3 be applied to all of the Outstanding Senior Notes (the "Defeased
Senior Notes"), upon compliance with the conditions set forth below in this
Article Four.
Section 4.2 Defeasance and Discharge.
Upon the Issuer's or the Partnership's exercise under Section 4.1 of the
option applicable to this Section 4.2, each of the Issuer, the Partnership and
any other obligor under the Senior Notes shall be deemed to have been discharged
from its obligations with respect to the Defeased Senior Notes on the date the
conditions set forth below are satisfied (hereinafter, "defeasance"). For this
purpose, such defeasance means that the Issuer and the Partnership shall be
deemed to have paid and discharged the entire indebtedness represented by the
Defeased Senior Notes, which shall thereafter be deemed to be "Outstanding" only
for the purposes of Section 4.5 and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all their other
obligations under such Senior Notes and this Indenture insofar as such Senior
Notes are concerned (and the Trustee, at the expense of the Issuer, and, upon
written request of the Issuer, shall execute proper instruments acknowledging
the same), except for the following which shall survive until otherwise
terminated or discharged hereunder: (a) the rights of Holders of Defeased Senior
Notes to receive solely from the trust fund described in Section 4.4 and as more
fully set forth in such Section, payments in respect of the principal of,
premium, if any, and interest on such Senior Notes when such payments are due,
(b) the Issuer's obligations with respect to such Defeased Senior Notes under
Sections 3.4, 3.5, 3.6, 10.2 and 10.3, (c) the rights, powers, trusts, duties,
indemnities and immunities of the Trustee hereunder and (d) this Article Four.
Subject to compliance with this Article Four, the Issuer and the Partnership may
exercise their option under this Section 4.2 notwithstanding the prior exercise
of their option under Section 4.3 with respect to the Senior Notes.
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Section 4.3 Covenant Defeasance.
Upon the Issuer's or the Partnership's exercise under Section 4.1 of the
option applicable to this Section 4.3, each of the Issuer, the Partnership and
any other obligor under the Senior Notes shall be released from its obligations
under any covenant or provision contained in Sections 8.1(a)(ii), (iii)(B), and
(v)(B), 8.1(b)(ii), (iv), (v) and (vii)(B), 10.5 through 10.17, 10.19 and 10.21,
and Article Twelve shall not apply with respect to the Defeased Senior Notes on
and after the date the conditions set forth below are satisfied (hereinafter,
"covenant defeasance"), and the Defeased Senior Notes shall thereafter be deemed
to be not "Outstanding" for the purposes of any direction, waiver, consent or
declaration or Act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "Outstanding"
for all other purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the Defeased Senior Notes, the Issuer, the
Partnership and any such obligor may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
Section or Article, whether directly or indirectly, by reason of any reference
elsewhere herein, in such Defeased Senior Notes or in the Senior Note Mortgage
Documents or other documents to any such Section or Article or by reason of any
reference in any such Section or Article to any other provision herein or in any
other document and such omission to comply shall not constitute a Default or an
Event of Default under Section 5.1(c) but, except as specified above and in the
following sentence, the remainder of this Indenture and such Defeased Senior
Notes shall be unaffected thereby. Upon any covenant defeasance, the events set
forth in Sections 5.1(d), (e), (i) and (k) shall not constitute Defaults or
Events of Default hereunder and any cross-reference in the Senior Note Mortgage
to a Default or Event of Default under this Indenture shall not be deemed to
include such Defaults or Events of Default.
Section 4.4 Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either Section 4.2
or Section 4.3 to the Defeased Senior Notes:
(1) The Issuer or the Partnership shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee satisfying the
requirements of Section 6.8 who shall agree to comply with the provisions of
this Article Four applicable to it) as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Senior Notes, (a) money
in an amount, or (b) U.S. Government Obligations which through the scheduled
payment of principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of any payment,
money in an amount, or (c) a combination thereof, sufficient, in the opinion of
a nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and discharge and
which shall be applied by the Trustee (or other qualifying trustee) to pay and
discharge, (i) the principal of, premium, if any, and interest on the Defeased
Senior Notes on the Stated Maturity of such principal or installment of
principal or interest and (ii) any mandatory payments applicable to the
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Outstanding Senior Notes on the day on which such payments are due and payable
in accordance with the terms of this Indenture and of such Senior Notes;
provided, that the Trustee (or other qualifying trustee) shall have been
irrevocably instructed to apply such money or the proceeds of such U.S.
Government Obligations to said payments with respect to the Senior Notes. For
this purpose, "U.S. Government Obligations" means securities that are (i) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act), as custodian with respect to any such obligation
or a specific payment of principal of or interest on any such obligation held by
such custodian for the account of the holder of such depository receipt,
provided, that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the U.S.
Government Obligation or the specific payment of principal of or interest on the
U.S. Government Obligation evidenced by such depository receipt.
(2) No Default or Event of Default shall have occurred and be continuing
on the date of such deposit or, insofar as subsections 5.1(g) and (h) are
concerned, at any time during the period ending on the 91st day after the date
of such deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period).
(3) Such defeasance or covenant defeasance shall not cause the Trustee for
the Senior Notes to have a conflicting interest in violation of Section 6.7 and
for purposes of the Trust Indenture Act with respect to any securities of the
Issuer or any other obligor under the Senior Notes.
(4) Such defeasance or covenant defeasance shall not result in a breach or
violation of, or constitute a default or event of default under, this Indenture
or any other material agreement or instrument to which the Issuer, the
Partnership or any other obligor under the Senior Notes is a party or by which
it is bound.
(5) In the case of an election under Section 4.2, the Issuer shall have
delivered to the Trustee an Opinion of Counsel stating that (x) the Issuer or
the Partnership, as the case may be, has received from, or there has been
published by, the Internal Revenue Service a ruling or (y) since the date
hereof, there has been a change in the applicable Federal income tax law, in
either case to the effect that, and based thereon such opinion shall confirm
that, the Holders of the Outstanding Senior Notes will not recognize income,
gain or loss for Federal income tax purposes as a result of such defeasance and
will be subject to Federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such defeasance had not
occurred.
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(6) In the case of an election under Section 4.3, the Issuer or the
Partnership, as the case may be, shall have delivered to the Trustee an Opinion
of Counsel to the effect that the Holders of the Outstanding Senior Notes will
not recognize income, gain or loss for Federal income tax purposes as a result
of such covenant defeasance and will be subject to Federal income tax on the
same amounts, in the same manner and at the same times as would have been the
case if such covenant defeasance had not occurred.
(7) The Issuer or the Partnership, as the case may be, shall have
delivered to the Trustee an Officers' Certificate stating that the deposit made
by the Issuer or the Partnership, as the case may be, pursuant to its election
under Section 4.2 or 4.3 was not made by the Issuer or the Partnership, as the
case may be, with the intent of preferring the Holders over the other creditors
of the Issuer or the Partnership with the intent of defeating, hindering,
delaying or defrauding creditors of the Issuer or the Partnership, as the case
may be, or others.
(8) The Issuer or the Partnership, as the case may be, shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent (other than conditions requiring the
passage of time) provided for relating to either the defeasance under Section
4.2 or the covenant defeasance under Section 4.3 (as the case may be) have been
complied with as contemplated by this Section 4.4. Opinions required to be
delivered under this Section may have qualifications customary for opinions of
the type required.
Section 4.5 Deposited Money and U.S. Government Obligations to be Held in
Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 10.3, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee (or other qualifying trustee--collectively for purposes of this
Section 4.5, the "Trustee") pursuant to Section 4.4 in respect of the Defeased
Senior Notes shall be held in trust and applied by the Trustee, in accordance
with the provisions of such Senior Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Issuer acting as its
own Paying Agent) as the Trustee may determine, to the Holders of such Defeased
Senior Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest, but such money need not be segregated from other
funds except to the extent required by law.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 4.4 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the Defeased Senior Notes.
Anything in this Article Four to the contrary notwithstanding, the Trustee
shall deliver or pay to the Issuer from time to time upon Issuer Request any
money or U.S. Government Obligations held by it as provided in Section 4.4
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
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the Trustee, are in excess of the amount thereof which would then be required to
be deposited to effect an equivalent defeasance or covenant defeasance.
Section 4.6 Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 4.2 or 4.3, as the case may
be, by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Issuer's and the Partnership's obligations under this Indenture and the Senior
Notes shall be revived and reinstated as though no deposit had occurred pursuant
to Section 4.2 or 4.3, as the case may be, until such time as the Trustee or
Paying Agent is permitted to apply all such money or U.S. Government Obligations
in accordance with Section 4.2 or 4.3, as the case may be; provided, however,
that if the Issuer makes any payment of principal, premium, if any, or interest
on any Senior Note following the reinstatement of its obligations, the Issuer
shall be subrogated to the rights of the Holders of such Senior Notes to receive
such payment from the money held by the Trustee or Paying Agent.
ARTICLE 5
REMEDIES
Section 5.1 Events of Default.
"Event of Default", wherever used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
occasioned by the provisions of Article Twelve or be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or governmental
body):
(a) default in the payment of any interest (including any Defaulted
Interest) on any of the Senior Notes when the same becomes due and payable and
the default continues for a period of 30 days;
(b) default in the payment of the principal of (or premium, if any, on)
any of the Senior Notes when the same becomes due and payable at its Stated
Maturity, upon acceleration, optional redemption, required repurchase, scheduled
principal payment or otherwise;
(c)(i) default in the performance, or breach, of any covenant of the
Issuer or the Partnership under the Senior Notes, the Senior Guarantee or this
Indenture (other than a default in the performance, or breach, of a covenant
that is specifically dealt with elsewhere in this Section 5.1) that continues
for 30 days after written notice has been given, by registered or certified
mail, (x) to the Issuer by the Trustee or (y) to the Issuer and the Trustee by
Holders of
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at least 25% of the aggregate principal amount of Outstanding Senior Notes,
specifying such default and requiring that it be remedied; (ii) default in the
performance or breach of the provisions of Article Eight hereof; (iii) the
Issuer or the Partnership shall have failed to make or consummate a Change of
Control Offer in accordance with Section 10.13 hereof; or (iv) the Issuer or the
Partnership shall have failed to make or consummate a required purchase of the
PIK Notes or Mortgage Notes in accordance with Section 10.9;
(d)(i) so long as there are only Registrable Series A Notes outstanding
hereunder, default by the Partnership, the Issuer or any of the Subsidiaries in
the payment, when due (whether at maturity, required prepayment, acceleration,
demand or otherwise) of any Indebtedness in an aggregate principal amount in
excess of $10,000,000 or any interest or premium thereon and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Indebtedness or any such Indebtedness shall be
declared to be due and payable or required to be prepaid (other than by a
regularly scheduled required prepayment) prior to the stated maturity thereof;
and (ii) on and after the date on which any of the events referred to in clauses
(A), (B) or (C) of the definition of Registrable Series A Notes has occurred,
the Partnership, the Issuer or any of the Subsidiaries shall fail to perform or
observe any term, covenant or agreement on its part to be performed or observed
under any agreement or instrument evidencing or securing or relating to any
Indebtedness in an aggregate principal amount in excess of $10,000,000 when
required to be performed or observed, if the effect of such failure is to
accelerate, or to permit the holder or holders of such Indebtedness to
accelerate, the maturity of such Indebtedness;
(e) one or more judgments, orders or decrees for the payment of money in
excess of $10,000,000, either individually or in the aggregate, shall be
rendered against the Issuer, the Partnership or any of the Subsidiaries or any
of their respective properties and shall not be discharged and either (i) an
enforcement proceeding shall have been commenced by any creditor upon such
judgment, order or decree or (ii) there shall be any period of 60 days, during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect;
(f) an "Event of Default" under any Indebtedness secured by a Lien on any
of the property or assets of the Issuer or any of the Subsidiaries having a book
value in excess of $500,000, which Lien is senior to the Lien on such property
or assets which secures the Senior Notes;
(g) there shall have been the entry by a court having jurisdiction in the
premises of (i) a decree or order for relief in respect of the Issuer, the
Partnership or any of the Subsidiaries in an involuntary case or proceeding
under any applicable Bankruptcy Law or (ii) a decree or order adjudging the
Issuer, the Partnership or any of the Subsidiaries bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Issuer, the Partnership or any of the Subsidiaries under any applicable
federal or state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the
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Issuer, the Partnership or any of the Subsidiaries or of any substantial part of
its property, or ordering the winding-up or liquidation of its affairs, and the
continuance of any such decree or order for relief or any such other decree or
order unstayed and in effect for a period of 60 consecutive days;
(h)(i) the Issuer, the Partnership or any of the Subsidiaries commences a
voluntary case or proceeding under any applicable Bankruptcy Law or any other
case or proceeding to be adjudicated bankrupt or insolvent, or (ii) the Issuer,
the Partnership or any of the Subsidiaries consents to the entry of a decree or
order for relief in respect of the Issuer or such Subsidiary in an involuntary
case or proceeding under any applicable Bankruptcy Law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or (iii) the Issuer,
the Partnership or any of the Subsidiaries files a petition or answer or consent
seeking reorganization or relief under any applicable federal or state law, or
the Issuer, the Partnership or any of the Subsidiaries consents to (1) the
filing of such petition or the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or similar
official of the Issuer, the Partnership or such Subsidiary or of any substantial
part of its property, (2) the making by it of an assignment for the benefit of
creditors or (3) the admission by it in writing of its inability to pay its
debts generally as they become due, or (iv) the taking of corporate or
partnership action by the Issuer, the Partnership or any of the Subsidiaries in
furtherance of any such action in this paragraph (i);
(i) the revocation, suspension or involuntary loss of any Permit which
results in the cessation of a substantial portion of the operations of the
Casino-Hotel for a period of more than 90 consecutive days;
(j) the Senior Guarantee, the Senior Guarantee Mortgage, or the Senior
Note Mortgage shall for any reason cease to be in full force and effect or
enforceable in accordance with its terms;
(k) an "Event of Default" under the Senior Note Mortgage, TCHI Note
Indenture, TCHI Note Mortgage Documents, the PIK Note Indenture or the Mortgage
Note Indenture, shall have occurred and is continuing; and
(l) an entity, which at the time, directly or indirectly, holds general
partnership interests in both of Trump Plaza Associates and Trump Taj Mahal
Associates, which general partnership interests had previously been held by
Donald J. Trump and his Affiliates, sells through an initial public distribution
its equity securities without having first acquired all the direct and indirect
partnership interests in the Partnership held by Donald J. Trump as of the date
of this Indenture.
Section 5.2 Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(g) or (h)) occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than
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25% in aggregate principal amount of the Outstanding Senior Notes may, and the
Trustee upon the request of the Holders of not less than 25% in aggregate
principal amount of the Outstanding Senior Notes shall, declare the principal of
all the Senior Notes to be due and payable immediately in an amount equal to the
principal amount of the Senior Notes, together with accrued and unpaid interest
to the date the Senior Notes become due and payable, by a notice in writing to
the Issuer (and to the Trustee, if given by the Holders) unless on or prior to
such amounts having become due and payable the Issuer shall have discharged or
paid in full the Indebtedness, if any, that is the subject of such Event of
Default and shall have given written notice of such cure to the Trustee (which
notice in the case of an Event of Default specified in Section 5.1(d) shall be
countersigned by the holders of the Indebtedness that is the subject of such
Event of Default or by a trustee, fiduciary or agent for such Holders). If an
Event of Default specified in Section 5.1(g) or (h) occurs and is continuing,
then the principal of all the Senior Notes shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
At any time after such declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the Holders of a majority
in aggregate principal amount of the Outstanding Senior Notes, by written notice
to the Issuer and the Trustee, may rescind and annul such declaration and its
consequences if:
(a) the Issuer has paid or deposited with the Trustee a sum sufficient to
pay
(i) all amounts due the Trustee under Section 6.6 and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel,
(ii) all overdue interest on all such Senior Notes,
(iii) the principal of and premium, if any, on any Senior Notes
which have become due otherwise than by such declaration of acceleration
and interest thereon at the rate borne by the Senior Notes, and
(iv) to the extent that payment of such interest is lawful, interest
upon overdue interest at the rate borne by such Senior Notes; and
(b) all Events of Default, other than the non-payment of principal of
Senior Notes which have become due solely by such declaration of acceleration,
have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon as provided in Section 5.13.
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Section 5.3 Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Issuer and the Partnership covenants that if
(a) default is made in the payment of any interest on any Senior Note when
such interest becomes due and payable and such default continues for a period of
30 days, or
(b) default is made in the payment of the principal of or premium, if any,
on any Senior Note at the Stated Maturity thereof,
the Issuer and the Partnership will, upon demand of the Trustee, pay to it, for
the benefit of the Holders of such Senior Notes, the whole amount then due and
payable on such Senior Notes for principal and premium, if any, and interest,
with interest upon the overdue principal and premium, if any, and, to the extent
that payment of such interest shall be legally enforceable, upon overdue
installments of interest, at the rate borne by the Senior Notes; and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Issuer or the Partnership, as the case may be, fails to pay such
amounts forthwith upon such demand, the Trustee, in its own name and as trustee
of an express trust, may institute a judicial proceeding for the collection of
the sums so due and unpaid and may prosecute such proceeding to judgment or
final decree, and may enforce the same against the Issuer, the Partnership or
any other obligor upon the Senior Notes and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of the property of the
Issuer, the Partnership or any other obligor upon the Senior Notes, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion (i) proceed to protect and enforce its rights and the rights of the
Holders under this Indenture, the Senior Guarantee or the Senior Note Mortgage
(subject to the terms thereof) by such appropriate private or judicial
proceedings as the Trustee shall deem most effectual to protect and enforce such
rights, including, without limitation, any rights or powers conferred on the
Trustee pursuant to the Senior Note Mortgage and seeking recourse against the
Partnership pursuant to the terms of the Senior Guarantee, or (ii) to proceed to
protect and enforce the rights of the Trustee and the Holders of Senior Notes
under the Senior Note Mortgage by such appropriate private or judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in the Senior Note Mortgage or in aid of the exercise of any power granted
therein, or to enforce any other proper remedy, including, without limitation,
seeking recourse against the Partnership pursuant to the terms of the Senior
Guarantee, appointment of a receiver for the Collateral and foreclosure,
realization and sale of the Collateral pursuant to the terms of the Senior Note
Mortgage. The Trustee shall be entitled to sue and recover judgment as aforesaid
or to sue to enforce any Lien under the Senior Note Mortgage, in either case,
either before, after or during
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the pendency of any other proceeding for the enforcement of any Lien under the
Senior Note Mortgage, and the right of the Trustee to recover such judgment
shall not be affected by any sale under the Senior Note Mortgage or by the
exercise of any right, power or remedy for the enforcement of the provisions of
the Senior Note Mortgage, or the foreclosure or enforcement of any Lien of the
Senior Note Mortgage. No recovery of any such judgment upon any property of the
Issuer or the Partnership shall affect or impair the Lien on the Collateral or
any rights, powers or remedies of the Trustee or the Holders.
Section 5.4 Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Issuer, the Partnership or any other obligor
upon the Senior Notes or the property of the Issuer, the Partnership or such
other obligor, the Trustee (irrespective of whether the principal of the Senior
Notes shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Issuer for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of principal, and
premium, if any, and interest owing and unpaid in respect of the Senior Notes
and to file such other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the Holders allowed in such judicial proceeding; and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.6.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Senior
Notes or the rights of any Holder thereof, or to authorize the Trustee to vote
in respect of the claim of any Holder in any such proceeding.
Section 5.5 Trustee May Enforce Claims Without Possession of the Senior
Notes.
All rights of action and claims under this Indenture or the Senior Notes
may be prosecuted and enforced by the Trustee without the possession of any of
the Senior Notes or the
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production thereof in any proceeding relating thereto, and any such proceeding
instituted by the Trustee shall be brought in its own name and as trustee of an
express trust, and any recovery of judgment shall, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders
of the Senior Notes in respect of which such judgment has been recovered.
Section 5.6 Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied, subject to applicable law, in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such money on account
of principal, premium, if any, or interest, upon presentation of the Senior
Notes and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 6.6;
SECOND: To the payment of the amounts then due and unpaid upon the Senior
Notes for principal, premium, if any, and interest, in respect of which or for
the benefit of which such money has been collected, ratably, without preference
or priority of any kind, according to the amounts due and payable on such Senior
Notes for principal, premium, if any, and interest;
THIRD: The balance, if any, to the Person or Persons entitled thereto,
including the Issuer.
Section 5.7 Limitation on Suits.
No Holder of any Senior Notes shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(a) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;
(b) the Holders of not less than 25% in principal amount of the
Outstanding Senior Notes shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
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(e) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Senior Notes;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture or the Senior Note Mortgage or the Senior Guarantee to affect,
disturb or prejudice the rights of any other Holders, or to obtain or to seek to
obtain priority or preference over any other Holders or to enforce any right
under this Indenture, except in the manner provided in this Indenture, the
Senior Guarantee or the Senior Note Mortgage and for the equal and ratable
benefit of all of the Holders.
Section 5.8 Unconditional Right of Holders to Receive Principal, Premium
and Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Senior Note shall have the right on the terms stated herein, which is absolute
and unconditional, to receive payment of the principal of, premium, if any, and
(subject to Sections 3.1 and 3.7) interest on such Senior Note on the respective
Stated Maturities expressed in such Senior Note (or, in the case of redemption,
on the Redemption Date) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.
Section 5.9 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture, the Senior Guarantee or the Senior Note
Mortgage and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in
every such case the Issuer, the Partnership, any other obligor under the Senior
Notes, the Trustee and the Holders shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and the Holders
shall continue as though no such proceeding had been instituted.
Section 5.10 Rights and Remedies Cumulative.
Except as provided in Section 3.6, no right or remedy herein conferred
upon or reserved to the Trustee or to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
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Section 5.11 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Senior Note to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section 5.12 Control by Holders.
The Holders of a majority in principal amount of the outstanding Senior
Notes shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee hereunder or under the Senior Note Mortgage,
provided that
(a) such direction shall not be in conflict with any rule of law or with
this Indenture, the Senior Guarantee Mortgage or the Senior Note Mortgage or
expose the Trustee to personal liability; and
(b) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 5.13 Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Senior Notes may on behalf of the Holders of all the Senior Notes
waive any past Default hereunder and its consequences, except a Default:
(a) in the payment of the principal of, premium, if any, or interest on
any Senior Note, or
(b) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Senior Note affected.
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
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Section 5.14 Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Senior Note by
his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture or the Senior Note Mortgage Documents, or in any suit against the
Trustee for any action taken, suffered or omitted by it as Trustee, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Holder, or group
of Holders, holding in the aggregate more than 10% in principal amount of the
Outstanding Senior Notes, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of, premium, if any, or interest on
any Senior Note on or after the respective Stated Maturities expressed in such
Senior Note (or, in the case of redemption, on or after the Redemption Date).
Section 5.15 Waiver of Stay, Extension or Usury Laws.
Each of the Issuer, the Partnership and any other obligor under the Senior
Notes covenants (to the extent that it may lawfully do so) that it will not at
any time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other law
wherever enacted, now or at any time hereafter in force, which would prohibit or
forgive the Issuer, the Partnership or any such obligor from paying all or any
portion of the principal of, premium, if any, or interest on the Senior Notes
contemplated herein or in the Senior Notes or which may affect the covenants or
the performance of this Indenture; and each of the Issuer, the Partnership and
any such obligor (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
Section 5.16 Unconditional Right of Holders to Institute Certain Suits.
Notwithstanding any other provision in this Indenture and any other
provision of any Senior Note, the right of any Holder of any Senior Note to
receive payment of the principal of, premium, if any, and interest on such
Senior Note on or after the respective due dates expressed in such Senior Note,
or to institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
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Section 5.17 Management of Casino-Hotel.
Notwithstanding any provision of this Article Five to the contrary,
(a) following an Event of Default under the Senior Note Mortgage and the
exercise by the Trustee of any of its rights under Section 3.9 thereof or other
taking of possession of the Collateral by the Trustee, the Trustee shall be
authorized, in addition to the rights and powers of the Trustee set forth
elsewhere in this Indenture and the Senior Note Mortgage, to retain one or more
experienced operators of hotels and/or casinos to manage the Casino-Hotel on
behalf of the Holders, provided that any such operator shall have all necessary
legal qualifications, including all Permits, to manage the Casino-Hotel; and
(b) no Holder shall have any right to take possession of, operate or
manage all or any portion of, the Casino-Hotel, individually or as a member of a
group, unless such Holder shall have all necessary legal qualifications,
including all Permits, to do so and shall otherwise be qualified to be retained
to manage the Casino-Hotel under Subsection (a) of this Section 5.17.
ARTICLE 6
THE TRUSTEE
Section 6.1 Duties of Trustee and Notice of Defaults.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, the Senior Note Mortgage and the
Senior Guarantee Mortgage, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements to this Indenture or
the Senior Note Mortgage or the Senior Guarantee Mortgage; but in the case of
any such certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the requirements of
this Indenture, the Senior Note Mortgage and the Senior Guarantee Mortgage.
(b) In case of an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of
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care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of such person's own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this Subsection (c) shall not be construed to limit the effect
of Subsection (a) of this Section 6.1;
(2) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in aggregate principal amount of
the Outstanding Senior Notes relating to the time, method and place of
conducting any proceeding for any remedy available to Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture; and
(4) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any
of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section
6.1.
(e) Within 30 days after the occurrence of any Default, the Trustee shall
transmit by mail to all Holders, as their names and addresses appear in the
Senior Note Register, notice of such Default hereunder known to the Trustee,
unless such Default shall have been cured or waived; provided, however, that,
except in the case of a Default in the payment of the principal of, premium, if
any, or interest on any Senior Note, the Trustee shall be protected in
withholding such notice if and so long as a trust committee of Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interest of the Holders; and provided, further, that in the
case of any Default of the character specified in Section 5.1(c) no such notice
to Holders shall be given until at least 15 days after the occurrence thereof.
The Trustee shall not be deemed to have knowledge of any Default (other than a
Default under Section 5.1(a) or (b) hereunder) unless and until the Trustee
shall have received notice of such Default or obtained actual knowledge thereof.
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Section 6.2 Certain Rights of Trustee.
Subject to the provisions of Section 315 of the Trust Indenture Act:
(a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) any request or direction of the Issuer mentioned herein shall be
sufficiently evidenced by an Issuer Request or Issuer Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) the Trustee may consult with counsel and any advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred therein or thereby in compliance with such
request or direction;
(e) the Trustee shall not be liable for any action taken or omitted by it
in good faith and believed by it to be authorized or within the discretion,
rights or powers conferred upon it by this Indenture other than any liabilities
arising out of the negligence of the Trustee;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, approval,
appraisal, bond, debenture, note, coupon, security or other paper or document
unless requested in writing so to do by the Holders of not less than a majority
in aggregate principal amount of the Senior Notes then Outstanding; provided
that, if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such expenses or liabilities as
a condition to proceeding; the reasonable expenses of every such investigation
shall be paid by the Partnership or, if paid by the Trustee or any predecessor
Trustee, shall be repaid by the Partnership upon demand; provided, further, the
Trustee in its discretion may make such further inquiry or investigation into
such facts or matters as it may deem fit, and, if the Trustee shall
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determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Partnership, personally or by
agent or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(h) no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers;
(i) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(j) in addition to and not in limitation of its other powers hereunder,
the Trustee shall have such power and authority as may be necessary to enter
into and accept delivery of any document as may be necessary to effect on behalf
of the Holders of the Senior Notes (1) the pari passu nature of the indebtedness
and Liens in respect of the Senior Notes to the Working Capital Facility and the
Liens securing the same, and (2) the priority of the indebtedness and Liens in
respect of the Senior Notes to (A) the indebtedness and Liens in respect of the
Mortgage Notes and (B) the indebtedness and Liens in respect of the PIK Notes,
and upon written request of the Issuer or the Partnership, the Trustee shall
enter into such agreements on behalf of the Holders.
Section 6.3 Trustee Not Responsible for Recitals, Dispositions of Senior
Notes or Application of Proceeds Thereof; etc.
The recitals contained herein and in the Senior Notes, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Issuer, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Senior Notes, except that the Trustee represents that it is
duly authorized to execute and deliver this Indenture, authenticate the Senior
Notes and perform its obligations hereunder and that the statements made by it
in a Statement of Eligibility and Qualification on Form T-1 to be supplied to
the Issuer will be true and accurate subject to the qualifications set forth
therein. The Trustee shall not be accountable for the use or application by the
Issuer of Senior Notes or the proceeds thereof. The Trustee shall not be deemed
to have knowledge of any Event of Default (other than an Event of Default under
Section 5.1(a) or (b) hereunder) unless and until the Trustee shall have
received notice of such Event of Default or obtained actual knowledge thereof.
The Trustee's receipt of reports and documents pursuant to Section 7.4 and
Section 10.18 hereof shall not constitute constructive knowledge of any
information contained therein or determinable from information contained
therein, including compliance with the covenants set forth in Article 10 hereof.
Except as expressly provided in
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this Indenture and except with respect to Section 10.1 hereof, the Trustee shall
not have an affirmative duty to inquire as to the compliance with the covenants
set forth in Article 10 hereof.
Section 6.4 Trustee and Agents May Hold Senior Notes; Collections; Etc.
The Trustee, any Paying Agent, Senior Note Registrar or any other agent of
the Issuer, in its individual or any other capacity, may become the owner or
pledgee of Senior Notes, with the same rights it would have if it were not the
Trustee, Paying Agent, Senior Note Registrar or such other agent and, subject to
Sections 310 and 311 of the Trust Indenture Act, may otherwise deal with the
Issuer and receive, collect, hold and retain collections from the Issuer with
the same rights it would have if it were not the Trustee, Paying Agent, Senior
Note Registrar or such other agent.
Section 6.5 Money Held in Trust.
All moneys received by the Trustee shall, until used or applied as herein
provided, be held in trust for the purposes for which they were received, but
need not be segregated from other funds except to the extent required by
mandatory provisions of law. Neither the Trustee nor any agent of the Issuer or
the Trustee shall be under any liability for interest on any moneys received by
it hereunder.
Section 6.6 Compensation and Indemnification of Trustee and Its Prior
Claim.
The Issuer and the Partnership covenant and agree to pay to the Trustee
from time to time, and the Trustee shall be entitled to, reasonable compensation
for all services rendered by it hereunder (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
and the Partnership covenants and agrees to pay or reimburse the Trustee and
each predecessor Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by or on behalf of it in accordance
with any of the provisions of this Indenture (including the reasonable
compensation and the expenses and disbursements of its counsel and of all agents
and other persons not regularly in its employ), except any such expense,
disbursement or advance as may arise from such Trustee's negligence or bad
faith. The Issuer and the Partnership also covenant to indemnify the Trustee and
each predecessor Trustee for, and to hold it harmless against, any loss,
liability, tax, assessment or other governmental charge (other than taxes
applicable to the Trustee's compensation hereunder) or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of this Indenture or the trusts hereunder and its
duties hereunder including enforcement of this Section 6.6 and also including
any liability which the Trustee may incur as a result of failure to withhold,
pay or report any tax, assessment or other governmental charge, and the costs
and expenses of defending itself against or investigating any claim of liability
in the premises. The obligations of the Issuer and the Partnership under this
Section to compensate and indemnify the Trustee and each predecessor Trustee and
to pay or reimburse the Trustee and each predecessor Trustee for expenses,
disbursements and advances
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shall constitute an additional obligation hereunder and shall survive the
satisfaction and discharge of this Indenture.
To secure the Issuer's and the Partnership's payment obligations in this
Section 6.6, the Trustee shall have a Lien prior to the Senior Notes on all
money and property held or collected by the Trustee or any receiver Trustee,
assignee, liquidator, sequestrator, custodian or similar officer in Trustee's
stead except such money or property held in trust to pay principal of (or
premium, if any) and interest on particular Senior Notes. Such Lien shall
survive satisfaction and discharge of this Indenture, and will be an additional
obligation of the Partnership hereunder.
Section 6.7 Conflicting Interests.
(a) If the Trustee has or acquires any conflicting interest, as defined in
Section 310(b) of the Trust Indenture Act, it shall, within ninety days after
ascertaining that it has such conflicting interest, either eliminate such
conflicting interest or resign in the manner and with the effect set forth in
Section 6.9(b).
(b) In the event that the Trustee shall fail to comply with the provisions
of the preceding subsection (a) of this Section, the Trustee shall, within ten
days after the expiration of such ninety day period, transmit notice of such
failure to the Holders, in the manner and to the extent provided in Section 7.3
with respect to reports.
Section 6.8 Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or of any state or territory or District of Columbia, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $100,000,000, subject to supervision or examination by
federal, state, territorial or District of Columbia supervising or examining
authority, and having a Corporate Trust Office in The City of New York to the
extent there is such an institution eligible and willing to serve. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of such supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.
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Section 6.9 Resignation and Removal; Appointment of Successor Trustee.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.10.
(b) The Trustee, or any trustee or trustees hereafter appointed, may at
any time resign by giving written notice thereof to the Issuer. Upon receiving
such notice of resignation, the Issuer shall promptly appoint a successor
trustee by written instrument executed by authority of the Board of Directors of
the Issuer, a copy of which shall be delivered to the resigning Trustee and a
copy to the successor trustee. If an instrument of acceptance by a successor
Trustee shall not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may, or any Holder
who has been a bona fide Holder of a Senior Note for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee. Such court
may thereupon, after such notice, if any, as it may deem proper, appoint a
successor trustee.
(c) The Trustee may be removed at any time by an Act of the Holders of a
majority in principal amount of the then Outstanding Senior Notes, delivered to
the Trustee and to the Issuer.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of Section
6.7 after written request therefor by the Issuer or by any Holder who has
been a bona fide Holder of a Senior Note for at least six months, or
(2) the Trustee shall cease to be eligible under Section 6.8 hereof
and shall fail to resign after written request therefor by the Issuer or
by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, or
(4) the CCC determines that the Trustee is required to be licensed
or found qualified or suitable and the Trustee does not become so licensed
or found qualified or suitable within such period as may be prescribed by
the CCC,
then, in any such case, (i) the Issuer by a Board Resolution may remove the
Trustee, or (ii) subject to Section 5.14 hereof, the Holder of any Senior Note
who has been a bona fide Holder of a Senior Note for at least six months may, on
behalf of himself and all others similarly
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situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe, remove the
Trustee and appoint a successor trustee.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Issuer,
by a Board Resolution, shall promptly, upon approval of the CCC, appoint a
successor Trustee which Trustee shall be licensed or found qualified or suitable
under the New Jersey Casino Control Act. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Senior Notes delivered to the Issuer, upon
approval by the CCC and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment, become the successor
Trustee and supersede the successor Trustee appointed by the Issuer. If no
successor Trustee shall have been so appointed by the Issuer or the Holders of
the Senior Notes and accepted appointment in the manner hereinafter provided,
the Holder of any Senior Note who has been a bona fide Holder for at least six
months may, subject to Section 5.14 hereof, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(f) The Issuer shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee by mailing written
notice of such event by first-class mail, postage prepaid, to the Holders of
Senior Notes as their names and addresses appear in the Senior Note Register.
Each notice shall include the name of the successor Trustee and the address of
its Corporate Trust Office.
Section 6.10 Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Issuer and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee as if originally named as Trustee hereunder; but,
nevertheless, on the written request of the Issuer or the successor Trustee,
upon payment of its charges then unpaid, such retiring Trustee shall pay over to
the successor Trustee all moneys at the time held by it hereunder and shall
execute and deliver an instrument transferring to such successor Trustee all
such rights, powers, duties and obligations.
Upon request of any such successor Trustee, the Issuer shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights and powers. Any Trustee ceasing to act
shall, nevertheless, retain a prior claim upon all property or funds held or
collected by such Trustee to secure any amounts then due it pursuant to the
provisions of Section 6.6.
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No successor Trustee with respect to the Senior Notes shall accept
appointment as provided in this Section 6.10 unless at the time of such
acceptance such successor Trustee shall be eligible to act as Trustee under the
provisions of Section 310(a) of the Trust Indenture Act and shall have a
combined capital and surplus of at least $100,000,000 and have a Corporate Trust
Office in The City of New York.
Upon acceptance of appointment by any successor Trustee as provided in
this Section 6.10, the Issuer shall give notice thereof to the Holders of the
Senior Notes, by mailing such notice to such Holders at their addresses as they
shall appear on the Senior Note Register. If the acceptance of appointment is
substantially contemporaneous with the resignation, then the notice called for
by the preceding sentence may be combined with the notice called for by Section
6.9. If the Issuer fails to give such notice within 10 days after acceptance of
appointment by the successor Trustee, the successor Trustee shall cause such
notice to be given at the expense of the Issuer.
Section 6.11 Merger, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be eligible under Section 310(a) of the Trust
Indenture Act and shall have a combined capital and surplus of at least
$100,000,000 and have a Corporate Trust Office in the City of New York, without
the execution or filing of any paper or any further act on the part of any of
the parties hereto.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Senior Notes shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such Senior
Notes so authenticated; and, in case at that time any of the Senior Notes shall
not have been authenticated, any successor to the Trustee may authenticate such
Senior Notes either in the name of any predecessor hereunder or in the name of
the successor Trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Senior Notes or in this Indenture
provided that the certificate of the Trustee shall have; provided that the right
to adopt the certificate of authentication of any predecessor Trustee or to
authenticate Senior Notes in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or consolidation.
ARTICLE 7
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HOLDERS' LISTS AND REPORTS BY TRUSTEE AND ISSUER
Section 7.1 Issuer to Furnish Trustee Names and Addresses of Holders.
The Issuer will furnish or cause to be furnished to the Trustee:
(a) semiannually, not more than 10 days after each Regular Record Date, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders as of such Regular Record Date; and
(b) at such other times as the Trustee may request in writing, within 30
days after receipt by the Issuer of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished;
provided, however, that if and so long as the Trustee shall be the Senior Note
Registrar, no such list need be furnished pursuant to clause (a) or (b) of this
Section 7.1.
Section 7.2 Disclosure of Names and Addresses of Holders.
Every Holder of Senior Notes, by receiving and holding the same, agrees
with the Issuer and the Trustee that neither the Issuer nor the Trustee shall be
held accountable by reason of the disclosure of any information as to the names
and addresses of the Holders in accordance with the New Jersey Casino Control
Act or Section 312 of the Trust Indenture Act, regardless of the source from
which such information was derived, and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 312 of the Trust Indenture Act.
Section 7.3 Reports by Trustee.
(a) Within 60 days after May 15 of each year commencing with May 15, 1998,
the Trustee shall transmit by mail to all Holders, as their names and addresses
appear in the Senior Note Register, as provided in Section 313(c) of the Trust
Indenture Act, a brief report dated as of such May 15 in accordance with and to
the extent required by Section 313(a) of the Trust Indenture Act.
(b) The Trustee will provide the CCC and the Director of the NJDGE with:
(1) copies of all notices, reports and other written communications
which the Trustee gives to Holders;
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(2) a list of Holders promptly after the original issuance of the
Senior Notes and a list of Holders eight months and two months prior to
the expiration date of each then-current gaming Permit held by the
Partnership;
(3) notice of any Event of Default under this Indenture or of any
event, occurrence or condition which, with the giving of notice or lapse
of time or both would constitute an Event of Default, any acceleration of
the Indebtedness evidenced or secured hereby, the institution of any legal
actions or proceedings before any court or governmental authority in
respect of this Indenture or the Senior Note Mortgage, the entering into
or taking possession of any property constituting the Collateral and any
rescission, annulment or waiver in respect of an Event of Default;
(4) notice of the removal or resignation of the Trustee within five
Business Days thereof;
(5) notice of any transfer or assignment of rights under this
Indenture (but not in respect of the Senior Notes) or the Senior Note
Mortgage within five Business Days thereof; and
(6) a copy of any amendment to the Senior Notes, this Indenture
(including the Senior Guarantee) or the Senior Note Mortgage within five
Business Days of the effectiveness thereof.
The notice specified in clause (3) above shall be in writing and, except
as set forth below, shall be given within five Business Days after the Trustee
has transmitted the notice required by Section 6.1. In the case of any notice in
respect of any Event of Default, such notice shall be accompanied by a copy of
any notice from the Holders, or a representative thereof or the Trustee, to the
defaulting Person and, if accompanied by any such notice to the defaulting
Person, shall be given simultaneously with the giving of any such notice to the
defaulting Person. In the case of any legal actions or proceedings, such notice
shall be accompanied by a copy of the complaint or other initial pleading or
document.
The Trustee shall in accordance with the limitations set forth herein
cooperate with the CCC and the Director of NJDGE in order to provide the CCC and
said Director with information and documentation relevant to compliance with
clause (3) above and as otherwise required by the New Jersey Casino Control Act.
The Partnership will advise the Trustee of the expiration date of the
then-current gaming Permit held by the Partnership at least 90 days prior to the
expiration thereof and the Trustee until so advised may assume that such Permit
has not expired.
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Section 7.4 Reports by the Issuer and the Partnership.
The Issuer and the Partnership shall:
(a) file with the Trustee, in accordance with Section 10.18 hereof within
15 days after the Issuer or the Partnership, as the case may be, is required to
file the same with the SEC, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may from time to time by rules and regulations prescribe) which the
Issuer or the Partnership, as the case may be, may be required to file with the
SEC pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the
Issuer or the Partnership, as the case may be, is not required to file
information, documents or reports pursuant to either of said Sections, then it
shall file with the Trustee and the SEC, in accordance with rules and
regulations prescribed from time to time by the SEC, such of the supplementary
and periodic information, documents and reports which may be required pursuant
to Section 13 of the Exchange Act in respect of a security listed and registered
on a national securities exchange as may be prescribed from time to time in such
rules and regulations;
(b) file with the Trustee and the SEC, in accordance with the rules and
regulations prescribed from time to time by the SEC, such additional
information, documents and reports with respect to compliance by the Issuer or
the Partnership, as the case may be, with the conditions and covenants of this
Indenture as may be required from time to time by such rules and regulations;
and
(c) transmit by mail to all Holders, as their names and addresses appear
in the Senior Note Register, within 30 days after the filing thereof with the
Trustee, in the manner and to the extent provided in Section 313(c) of the Trust
Indenture Act, such summaries of any information, documents and reports required
to be filed by the Issuer pursuant to Subsections (a) and (b) of this Section as
may be required by rules and regulations prescribed from time to time by the
SEC.
ARTICLE 8
CONSOLIDATION, MERGER,
CONVEYANCE, TRANSFER OR LEASE
Section 8.1 The Issuer or the Partnership May Consolidate, Merge, etc.,
Only on Certain Terms.
(a) The Partnership shall not consolidate with, merge with or into any
other Person or sell, assign, convey, transfer, lease or otherwise dispose of
all or substantially all of its properties and assets (as an entirety or
substantially as an entirety in one transaction or series of related
transactions) to any other Person or group of affiliated Persons or permit any
of the
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Subsidiaries to enter into any such transaction or transactions if such
transaction or transactions, in the aggregate, would result in a transfer of all
or substantially all of the assets of the Partnership and the Subsidiaries on a
consolidated basis to any other Person or group of affiliated Persons, unless:
(i) either (a) the Partnership shall be the continuing Person, or
(b) the Person (if other than the Partnership) formed by such
consolidation or into which the Partnership is merged or the Person which
acquires by conveyance, transfer, lease or disposition the properties and
assets of the Partnership (the "Surviving Entity") shall be a corporation
or partnership duly organized and validly existing under the laws of the
United States of America, any state thereof or the District of Columbia
and shall, in either case, expressly assume, by an indenture supplemental
to this Indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the Senior Guarantee and the performance and
observance of every covenant of this Indenture and the Senior Note
Mortgage on the part of the Partnership to be performed or observed and
this Indenture and the Senior Note Mortgage shall remain in full force and
effect;
(ii) immediately after giving effect to such transaction on a pro
forma basis (and treating any Indebtedness not previously an obligation of
the Partnership or a Subsidiary which becomes the obligation of the
Partnership or any of its Subsidiaries in connection with or as a result
of such transaction as having been incurred at the time of such
transaction), the Consolidated Net Worth of the Partnership (or the
Surviving Entity if the Partnership is not the continuing obligor under
this Indenture) is at least equal to the Consolidated Net Worth of the
Partnership immediately prior to such transaction or series of
transactions;
(iii) immediately before and immediately after giving effect to such
transaction on a pro forma basis (and treating any Indebtedness not
previously an obligation of the Partnership or a Subsidiary which becomes
the obligation of the Partnership or any of its Subsidiaries in connection
with or as a result of such transaction as having been incurred at the
time of such transaction), (A) no Default or Event of Default, shall have
occurred and be continuing and (B) the Partnership (or the Surviving
Entity if the Partnership is not the continuing obligor under this
Indenture) after giving effect to such transaction, could incur $1.00 of
additional Indebtedness (other than Permitted Indebtedness), under the
provisions of Section 10.7;
(iv) immediately after such transaction, the Partnership or the
Surviving Entity holds all Permits required for operation of the business
of, and such entity is controlled by a Person or entity (or has retained a
Person or entity which is) experienced in, operating casino hotels or
otherwise holds all Permits (including from the CCC) to operate its
business; and
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(v) in connection with any consolidation, merger, transfer or lease
contemplated hereby, the Partnership shall deliver, or cause to be
delivered, to the Trustee, in the form and substance reasonably
satisfactory to the Trustee, an Officers' Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, transfer or lease
and the supplemental indenture in respect thereto comply with the
provisions described herein and that (A) all conditions precedent herein
provided for relating to such transaction have been complied with and (B)
the transaction shall not impair the Lien of the Senior Note Mortgage,
this Indenture and the Senior Notes and the rights and powers of the
Trustee and Holders thereunder.
(b) The Issuer shall not consolidate with or merge with or into any other
Person or sell, assign, convey, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets (as an entirety in one
transaction or series of related transactions) to any other Person or group of
affiliated Persons unless:
(i) either (1) the Issuer shall be the continuing corporation or (2)
the Person (if other than the Issuer) formed by such consolidation, or
into which the Issuer is merged or the Person which acquires by sale,
assignment, conveyance, transfer, lease or disposition the properties and
assets of the Issuer (the "Surviving Entity") shall be a corporation,
partnership or trust organized and validly existing under the laws of the
United States of America, any state thereof or the District of Columbia
and shall, in either case, expressly assume by an indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to the
Trustee, all the obligations of the Issuer under the Senior Notes, this
Indenture and the Senior Note Mortgage;
(ii) immediately before and immediately after giving effect to such
transaction on a pro forma basis, no Default or Event of Default shall
have occurred and be continuing;
(iii) the Partnership shall have by supplemental indenture confirmed
that its obligations under the Senior Guarantee and the Senior Note
Mortgage shall apply to such Person's obligations under this Indenture and
the Senior Notes;
(iv) immediately after giving effect to such transaction on a pro
forma basis (and treating any Indebtedness not previously an obligation of
the Partnership or a Subsidiary which becomes the obligation of the
Partnership or any Subsidiary in connection with or as a result of such
transaction as having been incurred at the time or such transaction), the
Consolidated Net Worth of the Issuer (or the Surviving Entity if the
Issuer is not the continuing obligor under this Indenture) is at least
equal to the Consolidated Net Worth of the Issuer immediately prior to
such transaction or series of transactions;
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(v) immediately before and immediately after giving effect to such
transaction on a pro forma basis (and treating any Indebtedness not
previously an obligation of the Partnership or a Subsidiary which becomes
the obligation of the Partnership or any of its Subsidiaries in connection
with or as a result of such transaction as having been incurred at the
time of such transaction), the Partnership or its successor, after giving
effect to such transaction, could incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness), under the provisions of
Section 10.7;
(vi) immediately after such transaction, the Issuer or the Surviving
Entity holds all Permits required for the operation of the business of the
Issuer and immediately after such transaction, the Partnership or its
successor holds all permits required for operation of the business of, and
such entity is controlled by a Person or entity (or has retained a Person
or entity which is) experienced in, operating casino hotels or otherwise
holds all Permits (including from the CCC) to operate its business; and
(vii) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, sale, assignment, conveyance, transfer, lease or
disposition and such supplemental indenture comply with this Indenture,
and that (A) all conditions precedent herein relating to such transaction
have been complied with and (B) the transaction shall not impair the lien
and security of the Senior Note Mortgage, this Indenture and the Senior
Notes and the rights and powers of the Trustee and Holders thereunder.
Section 8.2 Successor Substituted.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer or disposition of all or substantially all of the properties and assets
of the Issuer or the Partnership in accordance with Section 8.1 (other than a
lease), the successor Person formed by such consolidation or into which the
Issuer or the Partnership, as the case may be, is merged or the successor Person
to which such sale, assignment, conveyance, transfer or disposition is made
shall succeed to, and be substituted for, and may exercise every right and power
of, the Issuer or the Partnership, as the case may be, under this Indenture
and/or the Senior Guarantee, as the case may be, and the Senior Note Mortgage
with the same effect as if such successor had been named as the Issuer or the
Partnership, as the case may be, herein and/or the Senior Guarantee, as the case
may be; and thereafter, except in the case of a lease, the Issuer or the
Partnership, as the case may be, shall be discharged from all obligations and
covenants under this Indenture, the Senior Notes and the Senior Note Mortgage
Documents, as the case may be.
ARTICLE 9
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SUPPLEMENTAL INDENTURES
Section 9.1 Supplemental Indentures and Agreements without Consent of
Holders.
Without the consent of any Holders, the Issuer and the Partnership when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto or agreements or
other instruments with respect to any Collateral, the Senior Guarantee, the
Senior Guarantee Mortgage, or the Senior Note Mortgage, in form and substance
satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Issuer or the
Partnership and the assumption by any such successor of the covenants of the
Issuer or the Partnership herein and in the Senior Notes, in the Senior
Guarantee, the Senior Guarantee Mortgage, and in the Senior Note Mortgage;
(b) to add to the covenants of the Issuer or the Partnership for the
benefit of the Holders, or to surrender any right or power herein conferred upon
the Issuer or the Partnership, as applicable, herein or in the Senior Note
Mortgage or the Senior Guarantee;
(c) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, the
Senior Note Mortgage Documents or the Senior Guarantee, or to clarify any other
provisions with respect to matters or questions arising under this Indenture,
the Senior Note Mortgage Documents or the Senior Guarantee; provided that, in
each case, such provisions shall not adversely affect the interests of the
Holders;
(d) to comply with the requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act, as
contemplated by Section 9.5 or otherwise;
(e) to add a guarantor of the Indenture Obligations;
(f) to evidence and provide the acceptance of the appointment of a
successor Trustee hereunder;
(g) to mortgage, pledge, hypothecate or grant a security interest in favor
of the Trustee for the benefit of the Holders as additional security for the
payment and performance of the Indenture Obligations, in any property or assets,
including any which are required to be mortgaged, pledged or hypothecated, or in
which a security interest is required to be granted to the Trustee pursuant to
this Indenture or the Senior Note Mortgage or otherwise; or
(h) to enter into the agreements described in Section 6.2(j) hereof.
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The terms of any document entered into pursuant to this Section shall be
subject to prior approval, if required, of the CCC and the NJDGE.
Section 9.2 Supplemental Indentures and Agreements with Consent of
Holders.
With the consent of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Senior Notes, by Act of said Holders
delivered to the Issuer, the Partnership and the Trustee, the Issuer and the
Partnership when authorized by Board Resolutions, and the Trustee may enter into
an indenture or indentures supplemental hereto or agreements or other
instruments with respect to the Collateral, the Senior Note Mortgage or the
Senior Guarantee in form and substance satisfactory to the Trustee for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Indenture or of modifying in any manner the rights of
the Holders under this Indenture, the Senior Notes, the Senior Guarantee, the
Senior Guarantee Mortgage, or the Senior Note Mortgage; provided, however, that
no such supplemental indenture, agreement or instrument shall, without the
consent of the Holder of each Outstanding Senior Note affected thereby:
(a) change the Stated Maturity of the principal of, or any installment of
interest on, any Senior Note or reduce the principal amount thereof or the rate
of interest thereon or any premium payable upon the redemption thereof, or
change the coin or currency in which any Senior Note or any premium or the
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment after the Stated Maturity thereof (or, in the
case of redemption, on or after the Redemption Date);
(b) modify the obligation of the Issuer and the Partnership to make and
consummate the Change of Control Offer under Section 10.13 (or modify any of the
provisions or definitions with respect thereto in a manner which adversely
affects the rights of Holders);
(c) reduce the percentage in principal amount of the Outstanding Senior
Notes, the consent of whose Holders is required for any such supplemental
indenture or amendment to the Senior Note Mortgage Documents, or the consent of
whose Holders is required for any waiver (of compliance with certain provisions
of this Indenture or certain Defaults hereunder and their consequences) provided
for in this Indenture, or with respect to the Senior Guarantee or the Senior
Note Mortgage Documents;
(d) modify any of the provisions of this Section or Section 5.13 and
10.20, except to increase any such percentage or to provide that certain other
provisions of this Indenture or the Senior Note Mortgage Documents cannot be
modified or waived without the consent of the Holder of each Senior Note
affected thereby; or
(e) except as otherwise permitted by Article Eight, consent to the
assignment or transfer by the Issuer or the Partnership of any of its rights and
obligations under this Indenture; or to
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the release of any Collateral from the Liens created by the Senior Note Mortgage
Documents except in accordance with this Indenture and the Senior Note Mortgage
Documents.
Upon the written request of the Issuer and the Partnership accompanied by
a copy of a Board Resolution authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the consent of
Holders as aforesaid, the Trustee shall join with the Issuer, the Partnership
and any other obligor under the Senior Notes in the execution of such
supplemental indenture.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
The terms of any document entered into pursuant to this Section shall be
subject to prior approval, if required, of the CCC and the NJDGE.
Section 9.3 Execution of Supplemental Indentures and Agreements.
In executing, or accepting the additional trusts created by, any
supplemental indenture, agreement or instrument permitted by this Article or the
modifications thereby of the trusts created by this Indenture, the Trustee shall
be entitled to receive, and shall be fully protected in relying upon, an Opinion
of Counsel and an Officers' Certificate stating that the execution of such
supplemental indenture, agreement or instrument is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture, agreement or instrument which affects the Trustee's
own rights, duties or immunities under this Indenture, the Senior Guarantee, the
Senior Note Mortgage Documents or otherwise.
Section 9.4 Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Senior Notes theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 9.5 Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 9.6 Reference in Senior Notes to Supplemental Indentures.
Senior Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by the Trustee,
bear a notation in
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form approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Issuer shall so determine, new Senior Notes so modified as to
conform, in the opinion of the Trustee and the Board of Directors, to any such
supplemental indenture may be prepared and executed by the Issuer, the
Partnership and any other obligor upon the Senior Notes and authenticated and
delivered by the Trustee in exchange for Outstanding Senior Notes.
Section 9.7 Record Date.
The Issuer may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any supplemental
indenture, agreement or instrument or any waiver, and shall promptly notify the
Trustee of any such record date. If a record date is fixed those Persons who
were Holders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to consent to such supplemental indenture,
agreement or instrument or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such record date. The
record date shall be a date no more than 30 days prior to the first solicitation
of Holders generally in connection therewith and no later than the date such
solicitation is completed. No such consent shall be valid or effective for more
than 90 days after such record date.
ARTICLE 10
COVENANTS
Section 10.1 Payment of Principal, Premium and Interest.
The Issuer will duly and punctually pay the principal of, premium, if any,
and interest on the Senior Notes in accordance with the terms of the Senior
Notes and this Indenture.
Section 10.2 Maintenance of Office or Agency.
The Issuer will maintain in The City of New York, an office or agency
where Senior Notes may be presented or surrendered for payment, where Senior
Notes may be surrendered for registration of transfer or exchange and where
notices and demands to or upon the Issuer in respect of the Senior Notes and
this Indenture may be served. The office of the Trustee at its Corporate Trust
Office shall be such office or agency of the Issuer, unless the Issuer shall
designate and maintain some other office or agency for one or more of such
purposes. The Issuer will give prompt written notice to the Trustee of any
change in the location of any such office or agency. If at any time the Issuer
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office, and the
Issuer hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
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The Issuer may from time to time designate one or more other offices or
agencies (in or outside of The City of New York) where the Senior Notes may be
presented or surrendered for any or all such purposes, and may from time to time
rescind such designation; provided, however, that no such designation or
rescission shall in any manner relieve the Issuer of its obligation to maintain
an office or agency in The City of New York for such purposes. The Issuer will
give prompt written notice to the Trustee of any such designation or rescission
and any change in the location of any such office or agency.
Section 10.3 Money for Senior Note Payments to be Held in Trust.
If the Issuer shall at any time act as its own Paying Agent, it will, on
or before each due date of the principal of, premium, if any, or interest on any
of the Senior Notes, segregate and hold in trust for the benefit of the Holders
entitled thereto a sum sufficient to pay the principal, premium, if any, or
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided, and will promptly notify the Trustee
of its action or failure so to act.
If the Issuer is not acting as Paying Agent, the Issuer will, on or before
each due date of the principal of, premium, if any, or interest on, any Senior
Notes, deposit with a Paying Agent a sum in same day funds sufficient to pay the
principal, premium, if any, or interest so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal, premium or
interest, and (unless such Paying Agent is the Trustee) the Issuer will promptly
notify the Trustee of such action or any failure so to act.
If the Issuer is not acting as Paying Agent, the Issuer will cause each
Paying Agent other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(a) hold all sums held by it for the payment of the principal of, premium,
if any, or interest on the Senior Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(b) give the Trustee notice of any Default by the Issuer or the
Partnership (or any other obligor upon the Senior Notes) in the making of any
deposit of principal, premium, if any, or interest;
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent; and
(d) acknowledge, accept and agree to comply in all aspects with the
provisions of this Indenture relating to the duties, rights and disabilities of
such Paying Agent.
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The Issuer may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Issuer
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Issuer or such Paying Agent, as the case may be, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Issuer or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Issuer, in trust for the payment of the principal of, premium, if any, or
interest on any Senior Note and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and payable shall (if
held by the Trustee or any Paying Agent) be paid to the Issuer on Issuer
Request, and shall be discharged from such trust; and the Holder of such Senior
Note shall thereafter, as an unsecured general creditor, look only to the Issuer
for payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Issuer as trustee thereof,
shall thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Issuer cause to be published once, in The New York Times and The Wall Street
Journal (national edition), notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such notification or publication, any unclaimed balance of such money
then remaining will be repaid to the Issuer.
Section 10.4 Issuer's and Partnership's Existence.
Subject to Article Eight, the Issuer and the Partnership will do or cause
to be done all things necessary to preserve and keep in full force and effect
the respective corporate or partnership existence, rights (charter and
statutory) and franchises of the Issuer and the Partnership; provided, however,
that the Issuer and the Partnership shall not be required to preserve any such
right or franchise if the Board of Directors of the Issuer shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Issuer and the Partnership and that the loss thereof is not
disadvantageous in any material respect to the Holders.
Section 10.5 Payment of Taxes and Other Claims.
The Issuer and the Partnership each will, and will cause the Subsidiaries
to, pay or discharge or cause to be paid or discharged, before any fine,
penalty, interest or cost may be added for nonpayment, (a) all taxes,
assessments and governmental charges levied or imposed upon the Issuer, the
Partnership or any Subsidiary or upon the income, profits or property of the
Issuer, the Partnership or any Subsidiary and (b) all lawful claims for labor,
materials and supplies, which, if unpaid, might by law become a lien upon the
property of the Issuer, the Partnership or any Subsidiary and shall otherwise
comply with the Senior Note Mortgage; provided, however, that neither the
Issuer, the Partnership nor any Subsidiary shall be required
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to pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings properly instituted and diligently
conducted and in respect of which appropriate reserves (in the good faith
judgment of management of the Issuer or the Partnership) are being maintained in
accordance with Generally Accepted Accounting Principles consistently applied.
Section 10.6 Maintenance of Properties.
The Issuer and the Partnership will, and will cause the Subsidiaries to,
cause all properties owned by the Issuer, the Partnership or any Subsidiary or
used or held for use in the conduct of the Issuer's or the Partnership's
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order (excepting reasonable wear and tear) and
supplied with all necessary equipment and will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Issuer or the Partnership may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; provided, however, that nothing in this Section shall
prevent the Issuer or the Partnership from discontinuing or allowing the
discontinuance of the maintenance of any of such properties if such
discontinuance is, in the judgment of the Issuer or the Partnership, desirable
in the conduct of their respective businesses or the business of any Subsidiary
and not disadvantageous in any material respect to the Holders. Nothing in this
Section 10.6 shall diminish the obligations of the Issuer or the Partnership
with respect to the Collateral as set forth in the Senior Note Mortgage.
Section 10.7 Limitation on Partnership Indebtedness.
The Partnership will not, and will not permit any of the Subsidiaries to,
create, incur, assume, or directly or indirectly guarantee or in any other
manner become directly or indirectly liable for the payment of, any Indebtedness
(including any Acquired Indebtedness, but excluding Permitted Indebtedness)
unless, in the case of Indebtedness of the Partnership and Acquired
Indebtedness, (a) the Partnership's Consolidated Fixed Charge Coverage Ratio for
the four full fiscal quarters immediately preceding such event, taken as one
period (and after giving pro forma effect to: (i) the incurrence of such
Indebtedness and (if applicable) the application of the net proceeds therefrom,
including to refinance other Indebtedness, as if such Indebtedness were incurred
and the application of such proceeds occurred at the beginning of such
four-quarter period; (ii) the incurrence, repayment or retirement of any other
Indebtedness by the Partnership or the Subsidiaries since the first day of such
four-quarter period as if such Indebtedness were incurred, repaid or retired at
the beginning of such four-quarter period (except that, in making such
computation, the amount of Indebtedness under any revolving credit facility
shall be computed based upon the average daily balance of such Indebtedness
during such four-quarter period); and (iii) the acquisition (whether by
purchase, merger or otherwise) or disposition (whether by sale, merger or
otherwise) of any company, entity or business acquired or disposed of by the
Partnership or the Subsidiaries, as the case may be, since the first day of such
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four-quarter period, as if such acquisition or disposition occurred at the
beginning of such four-quarter period), would have been at least equal to a
ratio of 1.75 to 1.
and (b) except in the case of Permitted Indebtedness, Acquired Indebtedness or
Pari Passu Indebtedness, such Indebtedness created, incurred, assumed or
guaranteed pursuant to this Section (i) has an Average Life to Stated Maturity
that exceeds the remaining Average Life to Stated Maturity of the Senior Notes
and (ii) has a Stated Maturity for its final scheduled principal payment later
than the Stated Maturity for the final scheduled principal payment of the Senior
Notes and (c) if such Indebtedness created, incurred, assumed or guaranteed
pursuant to this Section is Pari Passu Indebtedness which is not Permitted
Indebtedness or Acquired Indebtedness, such Indebtedness shall have (i) an
Average Life to Stated Maturity no shorter than the remaining Average Life to
Stated Maturity of the Senior Notes and (ii) a Stated Maturity for its final
scheduled principal payment that is not earlier than the Stated Maturity for the
final scheduled principal payment of the Senior Notes.
Section 10.8 Limitation on Liens.
Neither the Issuer nor the Partnership will, nor will any Subsidiary be
permitted to, create, incur, assume or suffer to exist any Liens upon any of
their respective assets, except for the Lien of the Senior Note Mortgage
Documents and Permitted Liens.
Section 10.9 Limitation on Restricted Payments.
(a) Neither the Issuer nor the Partnership will, nor will any Subsidiary
be permitted to, directly or indirectly:
(i) declare or make any distribution on the Issuer's Capital Stock
or the Partnership's Equity Interests, as the case may be, (other than
distributions payable in the Issuer's Qualified Capital Stock or the
Partnership's Qualified Equity Interests or in options, warrants or other
rights to purchase such Qualified Capital Stock or Qualified Equity
Interests);
(ii) purchase, redeem or otherwise acquire or retire for value any
such Capital Stock or Equity Interests, or any options, warrants or other
rights to acquire such Capital Stock or Equity Interests;
(iii) make any principal payment on or redeem, repurchase, defease
or otherwise acquire or retire for value prior to any scheduled principal
payment or maturity, any Pari Passu Indebtedness (other than Permitted
Indebtedness) or Subordinated Indebtedness of the Partnership other than
pursuant to clause (a)(3) below; or
(iv) incur, create, assume or suffer to exist any guarantee (other
than guarantees existing on the date of this Indenture and any renewals,
extensions, substitutions,
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refinancings or replacements of such guarantees) of Indebtedness of any
Affiliate of the Partnership or the Issuer;
(the foregoing actions set forth in clauses (i) through (iv) being referred to
as "Restricted Payments"), except that the Partnership may apply up to 50% of
its Excess Available Cash to make a Restricted Payment if: at the time of such
Restricted Payment and after giving effect thereto, (1) no Default or Event of
Default shall have occurred and be continuing; (2) the Partnership's
Consolidated Fixed Charge Coverage Ratio for the four full fiscal quarters
immediately preceding the Restricted Payment, taken as one period (after giving
pro forma effect to the Restricted Payment and (if applicable) the application
of the net proceeds therefrom and any events set forth in clauses (a)(ii) and
(a)(iii) under Section 10.7) would have been at least equal to 1.75 to 1; and
(3) prior to making such Restricted Payment, the Issuer or the Partnership shall
have used an amount equal to such Restricted Payment to purchase Mortgage Notes
or PIK Notes on the open market or pursuant to a tender offer which purchase
shall not be deemed to be a Restricted Payment.
(b) Notwithstanding the foregoing, and so long as there is no Default or
Event of Default continuing, the foregoing provisions will not prohibit:
(i) payments made pursuant to the terms of the Services Agreement as
in effect on the date hereof;
(ii) distributions in respect of the Limited Partner Priority
Capital (as defined in the Partnership Agreement) to the extent permitted
under the Amended Partnership Agreement as in effect on the date hereof;
(iii) payment of an annual bonus to Donald J. Trump that has been
approved by a majority of the Noteholder Representatives;
(iv) dividend payments within 60 days after declaration if such
payments would comply with the foregoing provision;
(v) the repurchase, redemption or other acquisition or retirement of
any shares of any class of Capital Stock of the Issuer or Equity Interest
of the Partnership in exchange for (including any such exchange pursuant
to the exercise of a conversion right or privilege in connection with
which cash is paid in lieu of the issuance of fractional shares, interests
or scrip), or out of the Net Cash Proceeds of a substantially concurrent
issue and sale (other than to a Subsidiary) of, other shares of Capital
Stock of the Issuer or Equity Interests of the Partnership, as the case
may be (other than Redeemable Capital Stock or Redeemable Equity
Interests, as the case may be);
(vi) (I) the redemption, repayment, defeasance, repurchase or other
acquisition or retirement for value of any Subordinated Indebtedness or
Pari Passu
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Indebtedness of the Partnership (other than Redeemable Equity Interests)
in exchange for or out of the net cash proceeds of a substantially current
issue and sale of (A) new Indebtedness of the Partnership or the Issuer or
(B) Equity Interests of the Partnership (other than Redeemable Equity
Interests) or Capital Stock of the Issuer (other than Redeemable Capital
Stock), provided that, with respect to clause (A), (1) the aggregate
principal amount of any such new Indebtedness does not exceed the
aggregate principal amount of such Subordinated or Pari Passu Indebtedness
(or, if such Subordinated or Pari Passu Indebtedness provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration thereof, then such lesser amount as of the
date of determination) plus accrued interest thereon plus the amount of
any premium or other payment required to be paid under the terms of the
instrument governing such Subordinated or Pari Passu Indebtedness or the
amount of any premium reasonably determined by the Partnership as
necessary to accomplish such refinancing by means of a tender offer or
privately negotiated purchase and, in each case, actually paid, plus the
amount of expenses of the Partnership incurred in connection with such
refinancing, (2) if the Indebtedness so redeemed, repaid, defeased,
repurchased, acquired or retired is Subordinated Indebtedness, any such
new Indebtedness (x) has an Average Life to Stated Maturity that exceeds
the Average Life to Stated Maturity of the Senior Notes and a Stated
Maturity that is not earlier than the final Stated Maturity of the Senior
Notes and (y) is expressly subordinated in right of payment to the Senior
Guarantee at least to the same extent as the Subordinated Indebtedness to
be redeemed, repaid, defeased, repurchased, acquired or retired and (3) if
the Indebtedness so redeemed, repaid, defeased, repurchased, acquired or
retired is Pari Passu Indebtedness, any such new Indebtedness has an
Average Life to Stated Maturity that is not less than the Average Life to
Stated Maturity of such Indebtedness and a Stated Maturity that is not
earlier than the final Stated Maturity of such Indebtedness; or (II) the
redemption, repayment, defeasance, repurchase or other acquisition or
retirement for value of any Redeemable Equity Interests of the Partnership
through the issuance of new shares of Redeemable Equity Interests of the
Partnership, provided that any such new Redeemable Equity Interests (1) do
not have a maturity or are otherwise redeemable at the option of the
holder prior to the Stated Maturity of the Senior Notes and (2) are
expressly subordinated in right of payment to the Senior Guarantee at
least to the same extent as Redeemable Equity Interests to be redeemed,
repurchased or otherwise acquired or retired for value;
(vii) the redemption of any share of any class of Capital Stock of
the Issuer or any Equity Interest of the Partnership or Indebtedness of
the Partnership or the Issuer, if (A) the holder thereof delivers an
Opinion of Counsel to the Trustee that failure to so redeem would subject
the holder thereof to an adverse action by a Gaming Authority (or, if
applicable, a failure to act by a Gaming Authority that is adverse to the
holder) and (B) the Board of Directors of the Partnership determines (as
evidenced by a Board Resolution delivered to the Trustee) that such
adverse action (or, if applicable, such failure to act) would be likely to
have a material adverse effect on such holder;
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(viii) (A) (i) distributions or intercompany loans to the Issuer by
the Partnership to pay interest in cash on the Outstanding Mortgage Notes
in accordance with the terms thereof and (ii) distributions or
intercompany loans to TCHI by the Partnership to pay interest in cash on
the Outstanding TCHI Notes in accordance with the terms thereof, (B)
distributions or intercompany loans of up to 50% of the Partnership's
Excess Available Cash to the Issuer by the Partnership to purchase, redeem
or otherwise acquire Outstanding PIK Notes in accordance with the terms
thereof, provided that the Partnership's Consolidated Fixed Charge
Coverage Ratio for the four full fiscal quarters immediately preceding the
Restricted Payment, taken as one period (after giving pro forma effect to
the Restricted Payment and (if applicable) the application of the net
proceeds therefrom and any events set forth in clauses (a)(ii) and
(a)(iii) of Section 10.7 above) would have been at least equal to 1.50 to
1, (C) distributions or intercompany loans to the Issuer by the
Partnership to pay interest in cash on the Outstanding PIK Notes in
accordance with the terms thereof, provided that the condition described
in Clause (a) in Section 10.7 is at that time satisfied and (D)
distributions or intercompany loans to the Issuer or TCHI by the
Partnership to pay any tax liability of the Issuer resulting from any
distribution or intercompany loan made in compliance with (A), (B) or (C)
above;
(ix) distributions or intercompany loans by the Partnership,
pursuant to the Partnership Agreement as in effect on the date of this
Indenture, to pay (a) reasonable general and administrative expenses,
including directors' fees and premiums for directors' and officers'
liability insurance of any corporate partners and (b) to make
indemnification payments as required by the Certificate of Incorporation
of the Issuer or TCHI or the Partnership Agreement, each as in effect on
the date hereof; and (c) to make distributions by the Partnership,
pursuant to the Partnership Agreement, to Partners in amounts in respect
of any tax year of the Partnership which do not exceed the Partners' tax
liability in respect of the Partnership's income for such year computed as
if the Partners were each taxpayers deriving items of income, gain, loss
or deduction only from the Partnership for such year and by applying the
sum of the higher of (x) the highest federal income tax rate imposed on
individuals for such year or (y) the highest federal income tax rate
imposed on corporations for such year, plus (z) in either case, eight
percent (8%) as the rate applicable to such year's results; and
(x) guarantees by the Partnership of Indebtedness of any special
purpose financing Affiliate of the Partnership, if the incurrence of such
guarantee is made in accordance with Section 10.7 hereof and the net
proceeds of any such Indebtedness are provided to the Partnership.
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Section 10.10 Limitation on Partnership Leases.
The Partnership will not, and will not permit any of the Subsidiaries to,
lease as tenant or subtenant real or personal property (except Permitted
Leases), unless the Partnership's Consolidated Fixed Charge Coverage Ratio for
the four full fiscal quarters immediately preceding such event, taken as one
period (and after giving pro forma effect to any such lease as if such lease was
entered into at the beginning of such four-quarter period and any events set
forth in clauses (a)(ii) and (a)(iii) of Section 10.7), would have been at least
equal to a ratio of 1.75 to 1. In giving effect to the lease as of such four
full fiscal quarters, it will be assumed that the rent for such prior four
fiscal quarters was the greater of the (i) average rent over the term of such
lease and (ii) rent payable for the first four fiscal quarters.
Section 10.11 Limitation on Preferred Stock of Subsidiaries and Subsidiary
Distributions.
(a) The Partnership will not permit any of the Subsidiaries to, directly
or indirectly, issue or sell any Preferred Stock (except to the Partnership or a
Wholly-owned Subsidiary thereof).
(b) The Partnership will not permit any of the Subsidiaries to, directly
or indirectly, (i) declare or pay any dividend or make any distribution on the
Capital Stock of such Subsidiary or to the holders of such Subsidiary's Capital
Stock (other than dividends or distributions payable in Capital Stock of such
Subsidiary) or (ii) purchase, redeem or otherwise acquire or retire for value
any such Capital Stock; provided that this covenant shall not prevent the
payment by any Subsidiary of dividends or other distributions to the Partnership
or a Wholly-owned Subsidiary or the redemption or repurchase by any Subsidiary
of any of its Capital Stock owned by the Partnership or a Wholly-owned
Subsidiary.
Section 10.12 Limitation on Payment Restrictions Affecting Subsidiaries.
The Partnership will not, nor will any of the Subsidiaries be permitted
to, create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction of any kind on the ability of the
Partnership or such Subsidiary to (a) pay dividends or make any other
distributions on the Partnership's Equity Interests or such Subsidiary's Capital
Stock or pay any Indebtedness owed to the Partnership or any other Subsidiary,
(b) make any loans or advances to the Partnership or any other Subsidiary or (c)
transfer any of its property or assets to the Partnership or any other
Wholly-owned Subsidiary, except (i) any restrictions, with respect to a
Subsidiary that is not a Subsidiary on the date of this Indenture, in existence
at the time such Person becomes a Subsidiary of the Partnership (but not created
in contemplation of such Person becoming a Subsidiary), (ii) any restrictions
with respect to a Subsidiary imposed pursuant to an agreement which has been
entered into for the sale or disposition of all or substantially all of the
Capital Stock or assets of such Subsidiary, (iii) any encumbrance or restriction
pursuant to an agreement in effect at or entered into on the date of this
Indenture, and
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(iv) any restrictions existing under any agreement which refinances or replaces
the agreements containing the restrictions in clauses (i), (ii) and (iii),
provided that the terms and conditions of any such agreement are no less
favorable to holders of the Senior Notes than those under or pursuant to the
agreement evidencing the Indebtedness refinanced.
Section 10.13 Purchase of Senior Notes upon Change of Control.
(a) If a Change of Control shall occur at any time, then each Holder shall
have the right to require that the Issuer or the Partnership repurchase such
Holder's Senior Notes in whole or in part in integral multiples of $1,000, at a
purchase price (the "Change of Control Purchase Price") in cash in an amount
equal to 101% of the principal amount thereof, plus accrued and unpaid interest
(including any Defaulted Interest), if any, to the date of purchase, pursuant to
the offer described in the following paragraph (the "Change of Control Offer")
and the other procedures set forth in this Section.
(b) Within 30 days following any Change of Control, the Issuer or the
Partnership shall send by first-class mail, postage prepaid, to the Trustee and
to each Holder, at his address appearing in the Senior Note Register, a notice
stating:
(1) that a Change of Control has occurred and that such Holder has
the right to require the Issuer or the Partnership to repurchase such
Holder's Senior Notes at the Change of Control Purchase Price;
(2) the circumstances and relevant facts regarding such Change of
Control (including but not limited to information with respect to pro
forma historical income, cash flow and capitalization after giving effect
to such Change of Control);
(3) the purchase date (the "Change of Control Purchase Date") which
shall be a Business Day no earlier than 45 days nor later than 60 days
from the date such notice is mailed (subject to applicable law);
(4) the Change of Control Purchase Price;
(5) that any Senior Note not tendered will continue to accrue
interest;
(6) that, unless the Issuer or the Partnership defaults in payment
of the Change of Control Purchase Price, any Senior Notes accepted for
payment pursuant to the Change of Control Offer shall cease to accrue
interest after the Change of Control Purchase Date; and
(7) the instructions such Holder must follow in order to have its
Senior Notes repurchased (and the instructions it must follow to withdraw
its election to have such Senior Notes repurchased) in accordance with
paragraph (c) of this Section.
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Notwithstanding the foregoing, within 20 days following any Change of Control,
the Issuer shall notify the Trustee that a Change of Control has occurred.
(c) Holders electing to have Senior Notes purchased will be required to
surrender such Senior Notes to the Paying Agent at the address specified in the
notice at least two Business Days prior to the Change of Control Purchase Date.
Subject to applicable law, Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than two Business Days prior to the
Change of Control Purchase Date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal amount and serial
numbers of the Senior Notes delivered for purchase by the Holder as to which its
election is to be withdrawn and a statement that such Holder is withdrawing his
election to have such Senior Notes purchased. Holders whose Senior Notes are
purchased only in part will be issued new Senior Notes equal in principal amount
to the unpurchased portion of the Senior Notes surrendered.
(d) Not later than the Change of Control Purchase Date, the Issuer or the
Partnership, as the case may be, shall (i) accept for payment Senior Notes or
portions thereof tendered pursuant to the Change of Control Offer, (ii) deposit
with the Paying Agent money sufficient, in immediately available funds by 12:00
noon (New York City Time), to pay the purchase price of all Senior Notes or
portions thereof so tendered and (iii) deliver to the Paying Agent an Officers'
Certificate stating the Senior Notes or portions thereof accepted for payment by
the Issuer or the Partnership. The Paying Agent shall promptly mail or release
to Holders of Senior Notes so accepted payment in an amount equal to the Change
of Control Purchase Price of the Senior Notes purchased from each such Holder,
and the Issuer shall execute and the Trustee shall promptly authenticate and
mail or release to such Holders a new Senior Note equal in principal amount to
any unpurchased portion of the Senior Note surrendered. The Issuer or the
Partnership, as the case may be, will publicly announce the results of the
Change of Control Offer on the Change in Control Purchase Date. For purposes of
this Section 10.13, the Issuer shall choose a Paying Agent which shall not be
the Issuer or the Partnership.
(e) The Issuer and the Partnership will not, and will not permit any
Subsidiary to, create or permit to exist or become effective any restriction
(other than restrictions existing under Indebtedness as in effect on the date of
this Indenture) that would materially impair the ability of the Issuer or the
Partnership to make a Change of Control Offer to purchase the Senior Notes or,
if such Change of Control offer is made, to pay for the Senior Notes tendered
for purchase.
Section 10.14 Limitations on Transactions with Affiliates.
Neither the Issuer nor the Partnership will, nor will any of the
Subsidiaries be permitted to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets, property or
services) with any Affiliate of the Issuer or the Partnership (other than a
Wholly-owned Subsidiary) unless (a) such transaction or series of related
transactions is on terms that are no less favorable to the Issuer, the
Partnership or such Subsidiary, as the case
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may be, than would be available at the time of such transaction or transactions
in a comparable transaction in arm's-length dealings with an unaffiliated third
party and with respect to a transaction or series of related transactions
involving aggregate payments equal to or greater than $5,000,000, such
transaction or series of related transactions is approved by a majority of the
Noteholder Representatives and (b) the Issuer or the Partnership, as the case
may be, delivers an Officers' Certificate to the Trustee certifying that such
transaction or transactions comply with clause (a) above. The foregoing
restriction will not apply to (1) the operations under the Services Agreement as
in effect on the date of this Indenture, (2) the payment of compensation to the
senior executive officers of the Issuer (excluding Donald J. Trump) which has
been approved by a majority of the Noteholder Representatives, (3) the payment
of an annual bonus to Donald J. Trump which has been approved by a majority of
the Noteholder Representatives, (4) the payment of director fees (other than to
Donald J. Trump) not in excess of those in effect as of the date of this
Indenture, (5) payments made pursuant to the Partnership Agreement as in effect
on the date of this Indenture, (6) payments pursuant to the Senior Partnership
Note or with respect to any Subordinated Indebtedness, and (7) Restricted
Payments otherwise permitted pursuant to the provisions of Section 10.9.
Section 10.15 Restriction on Transfer of Assets.
The Partnership will not sell, convey, transfer, lease or otherwise
dispose of its assets or property to any of the Subsidiaries.
Section 10.16 Limitation on Activities and Investments.
Neither the Partnership nor any of the Subsidiaries will engage in any
business or investment activities other than those necessary or appropriate for,
incident to, in connection with or arising out of, developing, financing, owning
and operating the Casino-Hotel.
The Partnership will not, and will not permit any Subsidiary to, make any
investment other than a Permitted Investment.
The Issuer will not conduct any business (including having any Subsidiary)
whatsoever, other than (i) to collect the amounts due and owing under the Senior
Partnership Note and any Subordinated Indebtedness, (ii) to preserve its rights
under the Senior Partnership Note, the Partnership Note and any Subordinated
Indebtedness and (iii) to do or cause to be done all things necessary or
appropriate to protect the property included in the Lien of the Senior Note
Mortgage and any further security and to preserve its rights therein and
otherwise to comply with its obligations under this Indenture, the Senior Notes,
the Mortgage Notes, the Mortgage Note Indenture, the PIK Note Indenture and the
PIK Notes.
The Issuer will not incur or otherwise become liable for any Indebtedness
(other than (w) the Senior Notes and renewal, extension, substitution,
refunding, refinancing or replacement thereof in accordance with this Indenture,
(x) the Mortgage Notes and any renewal, extension,
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substitution, refunding, refinancing, or replacement thereof in accordance with
this Indenture and the Mortgage Note Indenture, (y) the PIK Notes including any
PIK Notes issued as payment of interest, and any renewal, extension,
substitution, refunding, refinancing or replacement thereof in accordance with
the PIK Note Indenture, and (z) any intercompany loan from the Partnership) nor
issue any Preferred Stock.
Section 10.17 Restriction on Payment of Services Fee.
The Issuer and the Partnership will not, and will not permit the
Subsidiaries to, pay any Services Fee under the Services Agreement or to pay or
reimburse any expenses relating thereto if a Default or Event of Default has
occurred and is continuing. The terms of the Services Agreement cannot be
amended to increase the amounts to be paid thereunder in the aggregate or on any
particular date, or in any other manner which would be adverse to the
Partnership, and the Partnership will not, and will not permit the Subsidiaries
to, enter into any management or consulting agreement with any Affiliate
relating to the Casino Hotel other than the Services Agreement.
Section 10.18 Provision of Financial Statements.
Whether or not the Issuer or the Partnership is subject to Section 13(a)
or 15(d) of the Exchange Act, the Issuer and the Partnership will, to the extent
permitted under the Exchange Act, file with the SEC the annual reports,
quarterly reports and other documents which the Issuer or the Partnership would
have been required to file with the SEC pursuant to such Section 13(a) or 15(d)
if the Issuer or the Partnership were so subject, such documents to be filed
with the SEC on or prior to the respective dates (the "Required Filing Dates")
by which the Issuer or the Partnership would have been required so to file such
documents if the Issuer or the Partnership were so subject. The Issuer or the
Partnership will also in any event (x) within 15 days of each Required Filing
Date (i) transmit by mail to all Holders, as their names and addresses appear in
the Senior Note Register, without cost to such Holders and (ii) file with the
Trustee copies of the annual reports, quarterly reports and other documents
which the Issuer or the Partnership would have been required to file with the
SEC pursuant to Section 13(a) or 15(d) of the Exchange Act if the Issuer or the
Partnership were subject to such Sections and (y) if filing such documents by
the Issuer or the Partnership with the SEC is not permitted under the Exchange
Act, promptly upon written request, supply copies of such documents to a
prospective holder of the Senior Notes at the Issuer's cost.
Section 10.19 Statement by Officers as to Default.
(a) The Issuer will deliver to the Trustee, on or before a date not more
than 60 days after the end of each fiscal quarter and not more than 120 days
after the end of each fiscal year of the Issuer ending after the date hereof, a
written statement signed by the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Comptroller, an Assistant Comptroller,
the Secretary or an Assistant Secretary of the Issuer, and in any event at least
one
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person signing such certificate shall be the principal executive officer,
principal financial officer or principal accounting officer of the Issuer,
setting forth the Consolidated Net Worth of the Issuer as of the end of such
fiscal quarter and stating whether or not, after a review under each signer's
supervision of the activities of the Issuer during such year and of the Issuer's
performance under this Indenture, to the best knowledge, based on such review,
of the signers thereof, the Issuer has fulfilled all its obligations under this
Indenture throughout such year, and, if there has been a Default specifying each
Default and the nature and status thereof.
(b) When any Default or Event of Default has occurred and is continuing,
or if the Trustee or any Holder or the trustee for or the holder of any other
evidence of Indebtedness of the Issuer or any Subsidiary gives any notice or
takes any other action with respect to a claimed default (other than with
respect to Indebtedness (other than any Mortgage Debt) in the principal amount
of less than $10,000,000), the Issuer shall deliver to the Trustee by registered
or certified mail or by telegram, telex or facsimile transmission followed by
hard copy an Officers' Certificate specifying such event, notice or other action
within five Business Days of its occurrence.
Section 10.20 Waiver of Certain Covenants.
The Issuer and the Partnership may omit in any particular instance to
comply with any covenant or condition set forth in Sections 8.1(a)(ii) and
(iii)(B) or Sections 10.5 through 10.12, Sections 10.14, 10.15, 10.17, 10.19 and
10.21, if, before or after the time for such compliance, the Holders of not less
than a majority in aggregate principal amount of the then Outstanding Senior
Notes shall, by Act of such Holders, waive such compliance in such instance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Issuer and the Partnership
and the duties of the Trustee in respect of any such covenant or condition shall
remain in full force and effect.
Section 10.21 Mortgage Notes and PIK Notes.
Notwithstanding anything to the contrary contained in this Indenture,
without the consent of the Holders of not less than a majority in the aggregate
principal amount of the then Outstanding Senior Notes by Act of such Holders
delivered to the Issuer, neither the Issuer nor the Partnership shall directly
or indirectly effect (i) any amendment or supplement to the Mortgage Note
Indenture which causes or permits (a) any change to the stated maturity date of
the Mortgage Notes to before November 15, 2003 or (b) any redemptions of the
Mortgage Notes (including, without limitation, any open market purchases or
purchases made pursuant to a tender offer) except as permitted in and on terms
included in the Mortgage Note Indenture as in effect on the date hereof; (ii)
any redemption of the Mortgage Notes (including, without limitation, any open
market purchases or purchases made pursuant to a tender offer), except in
connection with making a Restricted Payment, as required by clause (3) of
Section 10.9(a) hereof; or (iii) any amendment or supplement to the PIK Note
Indenture which causes or permits (a) any change to the stated
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maturity date of the PIK Notes to before November 15, 2005 or (b) any
redemptions of the PIK Notes (including, without limitation, any open market
purchases made pursuant to a tender offer) except as permitted in and on terms
included in the PIK Note Indenture as in effect on the date hereof.
ARTICLE 11
REDEMPTION OF SENIOR NOTES
Section 11.1 Senior Notes Redeemed Pursuant to Casino Control Act.
Notwithstanding any provisions of this Article Eleven to the contrary, if
the CCC does not waive the qualification requirements as to any Holder (whether
the record owner or beneficial owner) and requires that such Holder be qualified
under the New Jersey Casino Control Act, then, in such event, such Holder must
qualify under such Act. If such Holder does not so qualify, such Holder must
dispose of its interest in the Senior Notes, within 30 days after the
Partnership's receipt of notice of such finding (or within such earlier date as
the CCC may require), or the Issuer or the Partnership may redeem such Senior
Notes at the lower of the Outstanding Amount and the Fair Market Value (as
certified to the Trustee) of such Senior Notes.
Section 11.2 Optional Redemption
The Issuer or the Partnership may at their election, redeem all, but not
less than all of the Senior Notes at 100% of the principal amount thereof, in
each case, together with accrued and unpaid interest through the Redemption
Date; provided, however, that no redemption of Senior Notes shall be made
pursuant to this Section 11.2 unless the Partnership or TCHI concurrently
redeems all of the TCHI Notes pursuant to Section 11.2 of the TCHI Note
Indenture.
Section 11.3 Senior Notes Redeemed Pursuant to a Total Taking or Casualty.
In the event of a Total Taking or Casualty, the Issuer or the Partnership
shall, within 60 days after receipt of any condemnation or insurance proceeds
but within one year after the occurrence of such Total Taking or Casualty,
redeem the Senior Notes at 100% of the principal amount thereof, in each case,
together with accrued and unpaid interest through the Redemption Date, in
accordance with this Article Eleven.
Section 11.4 Applicability of Article.
Redemption of Senior Notes as required by any provision of this Indenture,
shall be made in accordance with such provision and this Article.
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Section 11.5 Notice to Trustee.
In case of any redemption in accordance with Sections 11.1, 11.2 or 11.3
hereof, the Issuer or the Partnership, as the case may be, shall, at least 60
days prior to the Redemption Date fixed by the Issuer or the Partnership (unless
a shorter notice period shall be satisfactory to the Trustee) notify the Trustee
in writing of such Redemption Date and of the principal amount of Senior Notes
to be redeemed.
Section 11.6 Selection by Trustee of Senior Notes to Be Redeemed.
If less than all the Senior Notes are to be redeemed, the particular
Senior Notes or portions thereof to be redeemed shall be selected not more than
60 days prior to the Redemption Date by the Trustee, from the Outstanding Senior
Notes not previously called for redemption pro rata, by lot or by any other
method as the Trustee shall deem fair and reasonable, and the amounts to be
redeemed may be equal to $1,000 or any integral multiple thereof.
The Trustee shall promptly notify the Issuer, the Partnership and the
Senior Note Registrar in writing of the Senior Notes selected for redemption
and, in the case of any Senior Notes selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to redemption of Senior Notes shall relate, in the case
of any Senior Note redeemed or to be redeemed only in part, to the portion of
the principal amount of such Senior Note which has been or is to be redeemed.
Section 11.7 Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Senior Notes to be redeemed, at his address appearing in the
Senior Note Register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all outstanding Senior Notes are to be redeemed, the
identification of the particular Senior Notes to be redeemed;
(d) in the case of a Senior Note to be redeemed in part, the principal
amount of such Senior Note to be redeemed and that after the Redemption Date
upon surrender of such Senior
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Note, new Senior Note or Senior Notes in the aggregate principal amount equal to
the unredeemed portion thereof will be issued;
(e) that Senior Notes called for redemption must be surrendered to the
Paying Agent to collect payment of the Redemption Price;
(f) that on the Redemption Date the Redemption Price will become due and
payable upon each such Senior Note or portion thereof, and that (unless the
Issuer or the Partnership shall default in payment of the Redemption Price)
interest thereon shall cease to accrue on and after said date;
(g) the place or places where such Senior Notes are to be surrendered for
payment of the Redemption Price;
(h) the CUSIP number, if any, relating to such Senior Notes; and
(i) if applicable, that such redemption is a result of a Total Taking or
Casualty.
Notice of redemption of Senior Notes to be redeemed shall be given by the
Issuer or, at the Issuer's written request, by the Trustee in the name and at
the expense of the Issuer.
The notice if mailed in the manner herein provided shall be conclusively
presumed to have been given, whether or not the Holder receives such notice. In
any case, failure to give such notice by mail or any defect in the notice to the
Holder of any Senior Note designated for redemption as a whole or in part shall
not affect the validity of the proceedings for the redemption of any other
Senior Note.
Section 11.8 Deposit of Redemption Price.
On or prior to any Redemption Date, the Issuer or the Partnership shall
deposit with the Trustee or with a Paying Agent (or, if the Issuer or the
Partnership is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 10.3) an amount of money in same day funds sufficient to pay
the Redemption Price of, and (except if the Redemption Date shall be an Interest
Payment Date) accrued interest on, all the Senior Notes or portions thereof
which are to be redeemed on that date.
Section 11.9 Senior Notes Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Senior Notes so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Issuer or the Partnership shall default in the payment of the Redemption Price
and accrued interest) such Senior Notes shall cease to bear interest. Upon
surrender of any such Senior Note for redemption in accordance with said
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notice, such Senior Note shall be paid by the Issuer or the Partnership, as the
case may be, at the Redemption Price together with accrued and unpaid interest
(including Defaulted Interest) to the Redemption Date; provided, however, that
installments of interest whose Stated Maturity is on or prior to the Redemption
Date shall be payable to the Holders of such Senior Notes, or one or more
Predecessor Senior Notes, registered as such on the relevant Regular Record
Dates according to the terms and the provisions of Section 3.7.
If any Senior Note called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any, shall,
until paid, bear interest from the Redemption Date at the rate borne by such
Senior Note.
Section 11.10 Senior Notes Redeemed in Part.
Any Senior Note which is to be redeemed only in part shall be surrendered
to the Paying Agent at the office or agency maintained for such purpose pursuant
to Section 10.2 (with, if the Issuer, the Partnership, the Senior Note Registrar
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Issuer, the Partnership, the Senior Note
Registrar or the Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Issuer shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Senior Note without
service charge, a new Senior Note or Senior Notes, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to,
and in exchange for, the unredeemed portion of the principal of the Senior Note
so surrendered that is not redeemed.
ARTICLE 12
SENIOR NOTE MORTGAGE DOCUMENTS
Section 12.1 Senior Note Mortgage Documents.
(a) In order to secure the due and punctual payment of the Indenture
Obligations, the Issuer, the Partnership and the Trustee have entered into the
Senior Note Mortgage Documents dated of even date herewith to create the
security interests thereunder and for related matters. The Issuer and the
Partnership covenant and agree that they have full right, power and lawful
authority to grant, bargain, sell, release, convey, hypothecate, assign,
mortgage, pledge, transfer, confirm and grant a security interest in the
property constituting the Collateral, in the manner and form done in the Senior
Note Mortgage Documents or intended to be done, and that (a) each will forever
warrant and defend the title to the same against the claims of all Persons
whatsoever in each case free and clear of all Liens whatsoever, except Permitted
Liens, (b) each will execute, acknowledge and deliver to the Trustee such
further assignments, transfers, assurances or other instruments as the Trustee
may reasonably require or request, and (c) each will do or cause to be done all
such acts and things as may be necessary or proper, or as may be
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reasonably required by the Trustee, to assure and confirm to the Trustee its
interest in the Collateral, or any part thereof, as from time to time
constituted, and the right, title and interest in and to the Senior Note
Mortgage Documents so as to render the same available for the security and
benefit of this Indenture and of the Senior Notes.
(b) Each Holder, by accepting a Senior Note, consents and agrees to all of
the terms and provisions of the Senior Note Mortgage Documents, as the same may
be amended from time to time pursuant to the provisions of the Senior Note
Mortgage Documents and this Indenture, and authorizes and directs the Trustee to
enter into the Senior Note Mortgage Documents to which it is a party and to
perform its obligations and exercise its rights thereunder in accordance
therewith; provided, however, that if any provision of the Senior Note Mortgage
Documents limits, qualifies, or conflicts with the duties imposed by the
provisions of the Trust Indenture Act, the Trust Indenture Act controls.
(c) As amongst the Holders, the Collateral as now or hereafter constituted
shall be held for the equal and ratable benefit of the Holders without
preference, priority or distinction of any thereof over any other by reason of
difference in time of issuance, sale or otherwise, as security for the Indenture
Obligations.
Section 12.2 Recording, Opinion of Counsel, Etc.
The Issuer and the Partnership will cause, at their own expense, this
Indenture, the Senior Notes, the Senior Note Mortgage Documents, and all
amendments or supplements thereto, to be registered, recorded and filed and/or
re-recorded and/or re-filed and/or renewed in such manner and in such place or
places, if any, as may be required by law in order fully to preserve and protect
the Liens of the Senior Note Mortgage Documents and all parts of the Collateral
and to effectuate and preserve the security of the Holders and all rights of the
Trustee.
The Issuer and the Partnership shall furnish to the Trustee:
(a) promptly after the execution and delivery of this Indenture and each
of the Senior Note Mortgage Documents or other instrument of further assurance,
an Opinion of Counsel stating that, in the opinion of such Counsel, the Senior
Note Mortgage Documents and other instruments of further assurance have been
properly recorded, endorsed, registered and filed, so as to make effective the
Lien intended to be created thereby, and reciting the details of such action or
stating that, in the opinion of such Counsel, no such action is necessary to
make such Liens effective; and
(b) within 60 days after November 30 in each year beginning with the year
1998, an Opinion of Counsel, dated as of such date, either stating that, in the
opinion of such Counsel, such action has been taken with respect to the
recording, registering, filing, re-recording, re-registering and re-filing of
this Indenture and the Senior Note Mortgage Documents, financing statements,
supplemental indentures, continuation statements or other instruments of
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further assurance as is necessary to maintain the Lien of the Senior Note
Mortgage Documents and reciting the details of such action, or stating that, in
the opinion of counsel, no such action prior to November 30 of the subsequent
year is necessary to maintain such Lien.
The Trustee shall hold in its possession the Senior Note Mortgage
Documents, except as it from time to time may be required for actions, suits or
proceedings relating to the Senior Note Mortgage Documents or for the purpose of
enforcing or realizing upon any right or value thereby represented. The Trustee
may, from time to time, in its sole discretion, for the purpose of convenient
location of the Senior Note Mortgage Documents, appoint one or more agents to
hold physical custody, for the account of the Trustee, of the Senior Note
Mortgage Documents.
Section 12.3 Release of Collateral.
To the extent applicable, the Issuer, the Partnership and each other
obligor on the Senior Notes shall cause ss. 314(d) of the Trust Indenture Act
relating to the release of property or securities from the Liens of the Senior
Note Mortgage Documents to be complied with.
Section 12.4 Trust Indenture Act Requirements.
The release of any Collateral from the terms of the Senior Note Mortgage
Documents or the release, in whole or in part, of the Liens created by any of
the Senior Note Mortgage Documents, will not be deemed to impair the security
interests thereunder in contravention of the provisions of this Indenture if and
to the extent the Collateral or Liens are released pursuant to, and in
accordance with, the applicable Senior Note Mortgage Documents and pursuant to,
and in accordance with, the terms hereof. As set forth in Section 12.3, to the
extent applicable, without limitation, the Issuer, the Partnership and each
other obligor on the Senior Notes shall cause ss. 314(d) of the Trust Indenture
Act relating to the release of property or securities from the Liens of the
Senior Note Mortgage Documents to be complied with. Any certificate or opinion
required by ss. 314(d) of the Trust Indenture Act may be made by two officers of
the company, except in cases in which ss. 314(d) of the Trust Indenture Act
requires that such certificate or opinion be made by an independent Person.
Section 12.5 Disposition of Certain Collateral without Requesting Release.
(a) Notwithstanding the provisions of Sections 12.3 and 12.4 hereof, the
Partnership may, pursuant to and in accordance with the Senior Note Mortgage
Documents and this Indenture, without requesting the release or consent of the
Trustee:
(i) sell or dispose of, free from the Lien of the Senior Note
Mortgage Documents, any Tangible Personal Property which, in its
reasonable opinion, may have become obsolete or unfit for use or which is
no longer necessary in the conduct of its businesses or the operation of
the Collateral or the disposal of cash free from the Lien of the Senior
Note Mortgage Documents in the ordinary course of business;
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(ii) alter, repair, replace, change the location or position of and
add to any Tangible Personal Property;
(iii) renew, extend, surrender, terminate, modify or amend any
leases of Tangible Personal Property, when, in its reasonable opinion, it
is prudent to do so; and
(iv) enter into all non-material title encumbrances described within
the definition of "Permitted Encumbrances" under the Senior Note Mortgage,
and including without limitation those transactions described in Section
5.3 of the Senior Note Mortgage.
(b) Notwithstanding the provisions of Subsection (a) above, (x) the
Partnership shall not dispose of or transfer (by lease, assignment, sale or
otherwise), or pledge, mortgage or otherwise encumber (other than Permitted
Liens), Collateral pursuant to the provisions of Section 12.5(a) with a fair
value to the obligor equal to 10% or more of the aggregate fair value of all
Collateral then existing (as determined in the good faith judgment of the Issuer
or the Partnership and, if required by the Trust Indenture Act, an independent
appraiser), in any transaction or any series of related transactions without
complying with Sections 12.3 and 12.4; and (y) the right of the Partnership to
rely upon the provisions of Section 12.5(a) from the date of this Indenture to
June 30, 1998 and for each semiannual period thereafter shall be conditioned
upon the Partnership delivering to the Trustee, on or before August 31, 1998 and
thereafter within 60 days following each February 28 and August 31, an Officers'
Certificate to the effect that all of such dispositions by the Partnership
during such semiannual period (other than those such dispositions, collections
or payments wherein the Partnership has complied with Sections 12.3 and 12.4)
were in the ordinary course of the Partnership's business and that the proceeds
therefrom were used by the Partnership in connection with its business.
(c) Any disposition of Collateral made in compliance with the provisions
of this Section 12.5 shall be deemed not to impair the Liens of the Senior Note
Mortgage Documents in contravention of the provisions of this Indenture.
(d) Upon receipt of an Issuer Request, the Trustee shall execute and
deliver, within five business days from the receipt of the Issuer Request, any
instrument deemed by the Partnership to be necessary or appropriate to dispose
of portions of the Collateral pursuant to this Section 12.5 if the provisions of
this Section 12.5 have been complied with.
Section 12.6 Suits to Protect the Collateral.
Subject to the provisions of the Senior Note Mortgage Documents, (i) the
Trustee may, in its sole discretion and without the consent of the Holders, take
all actions it deems necessary or appropriate in order to (a) enforce any of the
terms of the Senior Note Mortgage Documents and (b) collect and receive any and
all amounts payable in respect of the obligations of the Issuer and the
Partnership and (ii) the Trustee shall have power to institute and to maintain
such suits and proceedings as it may deem expedient to prevent any impairment of
the Collateral by any
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acts which may be unlawful or in violation of the Senior Note Mortgage Documents
or this Indenture, including such suits and proceedings as the Trustee may deem
expedient to preserve or protect its interests and the interests of the Holders
in the Collateral and in the principal, interest, issues, profits, rents,
revenues and other income arising therefrom (including power to institute and
maintain suits or proceedings to restrain the enforcement of or compliance with
any legislative or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or compliance with,
such enactment, rule or order would impair the security interests or be
prejudicial to the interests of the Holders or the Trustee).
Section 12.7 Determinations Relating to Collateral.
In the event (i) the Trustee shall receive any written request from the
Issuer or the Partnership under any Senior Note Mortgage Documents for consent
or approval with respect to any matter or thing relating to any Collateral or
the Issuer's or the Partnership's obligations with respect thereto or (ii) there
shall be due to or from the Trustee under the provisions of the Senior Note
Mortgage Documents any material performance or the delivery of any material
instrument or (iii) the Trustee shall become aware of any nonperformance by the
Issuer or the Partnership of any covenant or any breach of any representation or
warranty of the Issuer or the Partnership set forth in the Senior Note Mortgage
Documents, then, in each such event, the Trustee shall be entitled to hire
experts, consultants, agents and attorneys to advise the Trustee on the manner
in which the Trustee should respond to such request or render any requested
performance or respond to such nonperformance or breach. The Trustee shall be
fully protected in the taking of any action recommended or approved by any such
expert, consultant, agent or attorney or agreed to by the Holders of a majority
in principal amount of the Outstanding Senior Notes pursuant to Section 5.12.
Section 12.8 Impairment of Security Interest.
The Issuer and the Partnership will not, and will not permit any
Subsidiary to, take or omit to take any action which reasonably might or would
have the result of affecting or impairing the security interests with respect to
the Collateral in contravention of this Indenture, and the Issuer and the
Partnership shall not (and shall cause the Subsidiaries not to) grant to, or
suffer to exist in favor of, any Person any interest whatsoever in the
Collateral except as permitted by the Senior Note Mortgage Documents or this
Indenture. The Issuer and the Partnership will not, and will not permit any
Subsidiary to, enter into any agreement or instrument that by its terms
expressly requires that the proceeds received from the sale of any Collateral be
applied to repay, redeem or otherwise retire any Indebtedness of any Person
other than as set forth in this Article Twelve and in the Senior Note Mortgage
Documents.
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Section 12.9 Release Upon Termination of the Issuer's Obligations.
(a) In the event that the Issuer delivers an Officers' Certificate
certifying that all of the Indenture Obligations have been indefeasibly
satisfied and discharged by complying with the provisions of Article Thirteen or
Sections 4.2 or 4.3, the Trustee shall deliver to the Issuer at the Issuer's
expense a notice stating that, subject to Section 4.6, the Trustee, on behalf of
the Holders, disclaims and gives up any and all rights it has in or to the
Collateral, and any rights it has under the Senior Note Mortgage Documents, and
on demand of and at the expense of the Issuer or the Partnership, the Trustee
shall also execute and deliver proper instruments acknowledging the satisfaction
and discharge of this Indenture and all Senior Note Mortgage Documents and, upon
and after the receipt by the Issuer of such notice, the Trustee shall not be
deemed to hold the security interests in the Collateral for the benefit of the
Holders and shall deliver to the Issuer any Collateral in its possession.
(b) Any release of any portion of the Collateral made strictly in
compliance with the provisions of this Section 12.9 shall not be deemed to
impair the security interests in the Collateral created by the Senior Note
Mortgage Documents in contravention of the provisions of this Indenture.
Section 12.10 Authorization of Receipt of Funds by the Trustee Under the
Senior Note Mortgage Documents.
The Trustee is authorized to receive any funds for the benefit of Holders
of Senior Notes distributed under the Senior Note Mortgage Documents, and to
make further distributions of such funds to the Holders according to the
provisions of this Indenture.
ARTICLE 13
SATISFACTION AND DISCHARGE
Section 13.1 Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to surviving
rights of registration of transfer or exchange of Senior Notes herein expressly
provided for) and the Trustee, on demand of and at the expense of the Issuer or
the Partnership, shall execute and deliver proper instruments acknowledging
satisfaction and discharge of this Indenture and all Senior Note Mortgage
Documents, when
(a) either
(1) all Senior Notes theretofore authenticated and delivered (other
than (i) Senior Notes which have been destroyed, lost or stolen and which
have been replaced or paid as
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provided in Section 3.6 and (ii) Senior Notes for whose payment funds have
theretofore been deposited in trust or segregated and held in trust by the
Issuer and thereafter repaid to the Issuer or discharged from such trust,
as provided in Section 10.3) have been delivered to the Trustee for
cancellation; or
(2) all such Senior Notes not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Issuer
and the Partnership,
and the Issuer or the Partnership, in the case of (2)(i), (ii) or (iii) above,
has irrevocably deposited or caused to be deposited with the Trustee as trust
funds in trust an amount in cash in lawful currency of the United States of
America or U.S. Government Obligations sufficient to pay and discharge the
entire Indebtedness on such Senior Notes not theretofore delivered to the
Trustee for cancellation, including principal of, premium, if any, and accrued
interest on such Senior Notes, at such Stated Maturity or Redemption Date;
(b) the Issuer and the Partnership have paid or caused to be paid all
other sums payable hereunder by the Issuer or the Partnership; and
(c) the Issuer and the Partnership have delivered to the Trustee an
Officers' Certificate and an opinion of Counsel each stating that (i) all
conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with and (ii) such satisfaction
and discharge will not result in a breach or violation of, or constitute a
default under, this Indenture or any other material agreement or instrument to
which the Issuer or the Partnership is a party or by which the Issuer or the
Partnership is bound.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Issuer and the Partnership to the Trustee under Section 6.6
and, if money shall have been deposited with the Trustee pursuant to subclause
(2) of Subsection (a) of this Section, the obligations of the Trustee under
Section 4.2 and the last paragraph of Section 10.3 shall survive.
Section 13.2 Application of Trust Money.
Subject to the provisions of the last paragraph of Section 10.3, all funds
deposited with the Trustee pursuant to Section 13.1 shall be held in trust and
applied by it, in accordance with
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the provisions of the Senior Notes and this Indenture, to the payment, either
directly or through any Paying Agent (including the Issuer acting as its own
Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of
the principal of, premium, if any, and interest on the Senior Notes for whose
payment such funds have been deposited with the Trustee.
ARTICLE 14
SENIOR GUARANTEE
Section 14.1 Partnership Senior Guarantee.
For value received, the Partnership in accordance with this Article
Fourteen and, subject to Section 3.11 hereof, hereby absolutely, unconditionally
and irrevocably guarantees to the Trustee and the Holders, as if the Partnership
were the principal debtor, the punctual payment and performance when due of all
Indenture Obligations (which for purposes of this Senior Guarantee shall also be
deemed to include all commissions, fees, charges, costs and other expenses
(including reasonable legal fees and disbursements of one counsel) arising out
of or incurred by the Trustee or the Holders in connection with the enforcement
of this Senior Guarantee).
Section 14.2 Continuing Guarantee; No Right of Set-Off; Independent
Obligation.
(a) This Senior Guarantee shall be a continuing guarantee of the payment
and performance of all Indenture Obligations and shall remain in full force and
effect until the payment in full of all of the Indenture Obligations and shall
apply to and secure any ultimate balance due or remaining unpaid to the Trustee
or the Holders; and this Senior Guarantee shall not be considered as wholly or
partially satisfied by the payment or liquidation at any time or from time to
time of any sum of money for the time being due or remaining unpaid to the
Trustee or the Holders. The Partnership covenants and agrees to comply with all
obligations, covenants, agreements and provisions applicable to it in this
Indenture including those set forth in Article Eight. Without limiting the
generality of the foregoing, the Partnership's liability shall extend to all
amounts which constitute part of the Indenture Obligations and would be owed by
the Issuer under this Indenture and the Senior Notes but for the fact that they
are unenforceable, reduced, limited, impaired, suspended or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
the Issuer.
(b) The Partnership hereby guarantees that the Indenture Obligations will
be paid to the Trustee without set-off or counterclaim or other reduction
whatsoever (whether for taxes, withholding or otherwise) in lawful currency of
the United States of America.
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(c) The Partnership guarantees that the Indenture Obligations shall be
paid strictly in accordance with their terms regardless of any law, regulation
or order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Holders of the Senior Notes.
(d) The Partnership's liability to pay or perform or cause the performance
of the Indenture Obligations under this Senior Guarantee shall arise forthwith
after demand for payment or performance by the Trustee has been given to the
Partnership in the manner prescribed in Section 1.6 hereof.
(e) Except as provided herein, the provisions of this Article Fourteen
cover all agreements between the parties hereto relative to this Senior
Guarantee and none of the parties shall be bound by any representation, warranty
or promise made by any Person relative thereto which is not embodied herein; and
it is specifically acknowledged and agreed that this Senior Guarantee has been
delivered by the Partnership free of any conditions whatsoever and that no
representations, warranties or promises have been made to the Partnership
affecting its liabilities hereunder, and that the Trustee shall not be bound by
any representations, warranties or promises now or at any time hereafter made by
the Issuer to the Partnership.
Section 14.3 Guarantee Absolute.
The obligations of the Partnership hereunder are independent of the
obligations of the Issuer under the Senior Notes and this Indenture and a
separate action or actions may be brought and prosecuted against the Partnership
whether or not an action or proceeding is brought against the Issuer and whether
or not the Issuer is joined in any such action or proceeding. The liability of
the Partnership hereunder is irrevocable, absolute and unconditional and (to the
extent permitted by law) the liability and obligations of the Partnership
hereunder shall not be released, discharged, mitigated, waived, impaired or
affected in whole or in part by:
(a) any defect or lack of validity or enforceability in respect of any
indebtedness or other obligation of the Issuer or any other Person
under this Indenture or the Senior Notes, or any agreement or
instrument relating to any of the foregoing;
(b) any grants of time, renewals, extensions, indulgences, releases,
discharges or modifications which the Trustee or the Holders may
extend to, or make with, the Issuer, the Partnership or any other
Person, or any change in the time, manner or place of payment of, or
in any other term of, all or any of the Indenture Obligations, or
any other amendment or waiver of, or any consent to or departure
from, this Indenture or the Senior Notes, including any increase or
decrease in the Indenture Obligations;
(c) the taking of security from the Issuer, the Partnership or any other
Person, and the release, discharge or alteration of, or other
dealing with, such security;
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(d) the occurrence of any change in the laws, rules, regulations or
ordinances of any jurisdiction by any present or future action of
any governmental authority or court amending, varying, reducing or
otherwise affecting, or purporting to amend, vary, reduce or
otherwise affect, any of the Indenture Obligations and the
obligations of the Partnership hereunder;
(e) the abstention from taking security from the Issuer, the Partnership
or any other Person or from perfecting, continuing to keep perfected
or taking advantage of any Lien of the Senior Note Mortgage;
(f) any loss, diminution of value or lack of enforceability of any
Senior Note received from the Issuer, the Partnership or any other
Person, and including any other guarantees received by the Trustee;
(g) any other dealings with the Issuer, the Partnership or any other
Person, or with any Senior Note;
(h) the Trustee's or the Holder's acceptance of compositions from the
Issuer or the Partnership;
(i) the application by the Holders or the Trustee of all monies at any
time and from time to time received from the Issuer, the Partnership
or any other Person on account of any indebtedness and liabilities
owing by the Issuer or the Partnership to the Trustee or the
Holders, in such manner as the Trustee or the Holders deems best and
the changing of such application in whole or in part and at any time
or from time to time, or any manner of application of collateral, or
proceeds thereof, to all or any of the Indenture Obligations, or the
manner of sale of any Collateral;
(j) the release or discharge of the Issuer or the Partnership or of any
other guarantor of the Senior Notes or of any Person liable directly
as surety or otherwise by operation of law or otherwise for the
Senior Notes, other than an express release in writing given by the
Trustee, on behalf of the Holders, of the liability and obligations
of the Partnership hereunder;
(k) any change in the name, business, capital structure or governing
instrument of the Issuer or the Partnership or any refinancing or
restructuring of any of the Indenture Obligations;
(l) the sale of the Issuer's or the Partnership's business or any part
thereof;
(m) any merger or consolidation, arrangement or reorganization of the
Issuer, the Partnership, any Person resulting from the merger or
consolidation of the Issuer
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or the Partnership with any other Person or any other successor to
such Person or merged or consolidated Person or any other change in
the corporate existence, structure or ownership of the Issuer or the
Partnership;
(n) the insolvency, bankruptcy, liquidation, winding-up, dissolution,
receivership or distribution of the assets of the Issuer or its
assets or any resulting discharge of any obligations of the Issuer
(whether voluntary or involuntary) or of the Partnership of the loss
of corporate existence;
(o) any arrangement or plan of reorganization affecting the Issuer or
the Partnership;
(p) any other circumstance (including any statute of limitations) that
might otherwise constitute a defense available to, or discharge of,
the Issuer or the Partnership; or
(q) any modification, compromise, settlement or release by the Trustee,
or by operation of law or otherwise, of the Indenture Obligations or
the liability of the Issuer or any other obligor under the Senior
Notes, or of any Collateral, in whole or in part, and any refusal of
payment by the Trustee, in whole or in part, from any other obligor
or other guarantor in connection with any of the Indenture
Obligations, whether or not with notice to, or further assent by, or
any reservation of rights against, the Partnership.
Section 14.4 Right to Demand Full Performance.
In the event of any demand for payment or performance by the Trustee from
the Partnership hereunder, the Trustee or the Holders shall have the right to
demand its full claim and to receive all dividends or other payments in respect
thereof until the Indenture Obligations have been paid in full, and the
Partnership shall continue to be liable hereunder for any balance which may be
owing to the Trustee or the Holders by the Issuer under this Indenture and the
Senior Notes. The retention by the Trustee or the Holders of any Senior Note,
prior to the realization by the Trustee or the Holders of its rights to such
Senior Note upon foreclosure thereon, shall not, as between the Trustee and the
Partnership, be considered as a purchase of such Senior Note, or as payment,
satisfaction or reduction of the Indenture Obligations due to the Trustee or the
Holders by the Issuer or any part thereof.
Section 14.5 Waivers.
(a) The Partnership hereby expressly waives (to the extent permitted by
law) notice of the acceptance of this Senior Guarantee and notice of the
existence, renewal, extension or the non-performance, non-payment, or
non-observance on the part of the Issuer of any of the terms, covenants,
conditions and provisions of this Indenture or the Senior Notes or any other
notice whatsoever to or upon the Issuer or the Partnership with respect to the
Indenture Obligations. The Partnership hereby acknowledges communication to it
of the terms of this Indenture and the
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Senior Notes and all of the provisions therein contained and consents to and
approves the same. The Partnership hereby expressly waives (to the extent
permitted by law) diligence, presentment, protest and demand for payment.
(b) Without prejudice to any of the rights or recourses which the Trustee
or the Holders may have against the Issuer, the Partnership hereby expressly
waives (to the extent permitted by law) any right to require the Trustee or the
Holders to:
(i) initiate or exhaust any rights, remedies or recourse against
the Issuer, the Partnership or any other Person;
(ii) value, realize upon, or dispose of any Senior Note of the
Issuer or any other Person held by the Trustee or the Holders;
or
(iii) initiate or exhaust any other remedy which the Trustee or the
Holders may have in law or equity;
before requiring or becoming entitled to demand payment from the Partnership
under this Guarantee.
Section 14.6 The Partnership Remains Obligated in Event the Issuer Is No
Longer Obligated to Discharge Indenture Obligations.
It is the express intention of the Trustee and the Partnership that if for
any reason the Issuer has no legal existence, is or becomes under no legal
obligation to discharge the Indenture Obligations owing to the Trustee or the
Holders by the Issuer or if any of the Indenture Obligations owing by the Issuer
to the Trustee or the Holders becomes irrevocable from the Issuer by operation
of law or for any reason whatsoever, this Senior Guarantee and the covenants,
agreements and obligations of the Partnership contained in this Article Fourteen
shall nevertheless be binding upon the Partnership, as principal debtor, until
such time as all such Indenture Obligations have been paid in full to the
Trustee and all Indenture Obligations owing to the Trustee or the Holders by the
Issuer have been discharged, or such earlier time as Section 4.2 shall apply to
the Senior Notes and the Partnership shall be responsible for the payment
thereof to the Trustee or the Holders upon demand.
Section 14.7 Waiver of Rights.
The Partnership agrees (to the extent permitted by law) that it hereby
waives and will not in any manner whatsoever claim or take the benefit or
advantage of, any rights of reimbursement, exoneration, contribution, indemnity
or subrogation (whether contractual, under Section 509 of Title Eleven of the
United States
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Code, under common law or otherwise) or any similar rights or "claims" (as such
term is defined under Title Eleven of the United States Code), against the
Issuer or any Subsidiary arising from the existence of, or performance by, the
Partnership under this Senior Guarantee.
Section 14.8 Senior Guarantee Is in Addition to Other Security.
This Senior Guarantee shall be in addition to and not in substitution for
any other guarantees or other security which the Trustee may now or hereafter
hold in respect of the Indenture Obligations owing to the Trustee or the Holders
by the Issuer and (except as may be required by law) the Trustee shall be under
no obligation to marshal in favor of the Partnership any other guarantees or
other security or any moneys or other assets which the Trustee may be entitled
to receive or upon which the Trustee or the Holders may have a claim.
Section 14.9 Release of Security Interests.
Without limiting the generality of the foregoing and except as otherwise
provided in this Indenture, the Partnership hereby consents and agrees, to the
fullest extent permitted by applicable law, that the rights of the Trustee
hereunder, and the liability of the Partnership hereunder, shall not be affected
by any and all releases for any purpose of any Collateral, if any, from the
Liens and security interests created by the Senior Note Mortgage and that this
Senior Guarantee shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the Indenture Obligations is
rescinded or must otherwise be returned by the Trustee upon the insolvency,
bankruptcy or reorganization of the Issuer or otherwise, all as though such
payment had not been made.
Section 14.10 No Bar to Further Actions.
Except as provided by law, no action or proceeding brought or instituted
under Article Fourteen and this Senior Guarantee and no recovery or judgment in
pursuance thereof shall be a bar or defense (other than a defense of payment) to
any further action or proceeding which may be brought under Article Fourteen and
this Senior Guarantee by reason of any further default or defaults under Article
Fourteen and this Senior Guarantee or in the payment of any of the Indenture
Obligations owing by the Issuer.
Section 14.11 Failure to Exercise Rights Shall Not Operate As a Waiver; No
Suspension of Remedies.
(a) No failure to exercise and no delay in exercising, on the part of the
Trustee or the Holders, any right, power, privilege or remedy under this Article
Fourteen and this Senior Guarantee shall operate as a waiver thereof, nor any
single or partial exercise of any right, power, privilege or remedy preclude any
other or further exercise thereof, or the exercise of any other rights, powers,
privileges or remedies. The rights and remedies herein provided for are
cumulative and not exclusive of any rights or remedies provided in law or
equity.
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(b) Nothing contained in this Article Fourteen shall limit the right of
the Trustee or the Holders to take any action to accelerate the maturity of the
Senior Notes pursuant to Article Five or to pursue any rights or remedies
hereunder or under applicable law.
Section 14.12 Successors and Assigns.
All terms, agreements and conditions of this Article Fourteen shall extend
to and be binding upon the Partnership and its successors and permitted assigns
and shall enure to the benefit of and may be enforced by the Trustee and its
successors and assigns; provided, however, that the Partnership may not assign
any of its rights or obligations hereunder other than in accordance with Article
Eight.
Section 14.13 Release of Senior Guarantee.
Concurrently with the payment in full of all of the Indenture Obligations,
the Partnership shall be released from and relieved of its obligations under
this Article Fourteen. Upon the delivery by the Issuer to the Trustee of an
Officers' Certificate and, if requested by the Trustee, an Opinion of Counsel to
the effect that the transaction giving rise to the release of this Senior
Guarantee was made by the Issuer in accordance with the provisions of this
Indenture and the Senior Notes, the Trustee shall execute any documents
reasonably required in order to evidence the release of the Partnership from its
obligations under this Senior Guarantee and the Senior Note Mortgage Documents
if any of the Indenture Obligations are revived and reinstated after the
termination of this Senior Guarantee, then all of the obligations of the
Partnership under this Senior Guarantee shall be revived and reinstated as if
this Senior Guarantee had not been terminated until such time as the Indenture
Obligations are paid in full, and the Partnership shall enter into an amendment
to this Senior Guarantee, reasonably satisfactory to the Trustee, evidencing
such revival and reinstatement.
This Senior Guarantee shall terminate upon a merger or consolidation of
the Partnership with the Issuer, in accordance with Article Eight.
Section 14.14 Execution of Senior Guarantee.
To evidence the Senior Guarantee, the Partnership hereby agrees to execute
a guarantee substantially in the form set forth in Section 2.5, to be endorsed
on each Senior Note authenticated and delivered by the Trustee and that this
Indenture shall be executed on behalf of the Partnership by one of its general
partners or its President or one of its Vice Presidents. The signature of any of
these officers on the Senior Notes may be manual or facsimile.
If an officer whose signature is on this Indenture no longer holds that
office at the time the Trustee authenticates a Senior Note on which this Senior
Guarantee is endorsed, such Senior Guarantee shall be valid nevertheless.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
TRUMP'S CASTLE FUNDING, INC.,
as Issuer
Attest: /s/ Robert M. Pickus By /s/ Nicholas L. Ribis
------------------------ ------------------------------
Name: Robert M. Pickus Nicholas L. Ribis
Title: Secretary President and Chief Executive Officer
TRUMP'S CASTLE ASSOCIATES, L.P.
By: TRUMP'S CASTLE HOTEL & CASINO,
INC., its General Partner
Attest: /s/ Robert M. Pickus By /s/ Nicholas L. Ribis
------------------------ ------------------------------
Name: Robert M. Pickus Nicholas L. Ribis
Title: Secretary President and Chief Executive Officer
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
Attest: /s/ Kathe M. Barrett By /s/ Richard H. Prokosch
------------------------ ------------------------------
Name: Kathe M. Barrett Name: Richard H. Prokosch
Title: Trust Officer Title: Assistant Vice President
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 15th day of April, 1998, before me personally came Nicholas L. Ribis, to
me known, who, being by me duly sworn, did depose and say that he is President
and Chief Executive Officer of Trump's Castle Funding, Inc., one of the
corporations described in and which executed the above instrument; that he knows
the corporate seal of such corporation; that the seal affixed to said instrument
is such corporate seal; that it was so affixed pursuant to authority of the
Board of Directors of such corporation; and that he signed his name thereto
pursuant to like authority.
(NOTARIAL SEAL)
/s/ Marcus Chioffi
------------------------
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on April 15, 1998, before me, the subscriber, personally
appeared Nicholas L. Ribis, the President and Chief Executive Officer of TRUMP'S
CASTLE HOTEL & CASINO, INC., a New Jersey corporation, which is the general
partner of TRUMP'S CASTLE ASSOCIATES, L.P., a New Jersey limited partnership,
who, I am satisfied, is the person who has signed the within instrument on
behalf of such entities, and I having first made known to him the contents
thereof he thereupon acknowledged that he signed and delivered the said
instrument in his capacity as aforesaid, and that the within instrument is the
voluntary act and deed of said entities.
(NOTARIAL SEAL)
/s/ Marcus Chioffi
------------------------
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 17th day of April, 1998, before me personally came Richard H. Prokosch,
to me known, who, being by me duly sworn, did depose and say that he is an
Assistant Vice President of U.S. Bank National Association, one of the entities
described in and which executed the above instrument; that he knows the
corporate seal of such entity; that the seal affixed to said instrument is such
corporate seal; that it was so affixed pursuant to authority of the board of
directors of such corporation; and that he signed his name thereto pursuant to
like authority.
(NOTARIAL SEAL)
/s/ Reese M. Heitner
------------------------
<PAGE>
SCHEDULE I TO FUNDING NOTE INDENTURE
OTHER PERMITTED INDEBTEDNESS
DESCRIPTION AMOUNT
- ----------- ------
NONE $0
<PAGE>
SCHEDULE II TO FUNDING NOTE INDENTURE
OTHER PERMITTED INVESTMENTS
DESCRIPTION AMOUNT
- ----------- ------
NONE $0
Execution Copy
----------------------------------------
REGISTRATION RIGHTS AGREEMENT
Dated as of April 17, 1998
by and among
TRUMP'S CASTLE FUNDING, INC.,
TRUMP'S CASTLE HOTEL & CASINO, INC.
TRUMP'S CASTLE ASSOCIATES, L.P.
and
THE FUNDS AND ACCOUNTS LISTED
ON EXHIBITS A, B, C AND D HERETO
10 1/4 Series A Senior Secured Notes due 2003 of Trump's Castle Funding,Inc.
10 1/4 Series A Senior Secured Notes due 2003 of Trump's Castle Hotel &
Casino, Inc.
----------------------------------------
<PAGE>
TABLE OF CONTENTS
1. Definitions....................................................1
2. Registered Exchange Offer......................................7
3. Shelf Registration.............................................8
(a) Initial Shelf Registration..........................8
(b) Subsequent Shelf Registrations......................9
(c) Supplements and Amendments..........................9
(d) Required Subsequent Registration....................10
(i) Required Subsequent Registration.......10
(ii) Expenses...............................10
(iii) Priority in Required Registrations.....10
4. Liquidated Damages.............................................11
5. Hold-Back Agreements...........................................12
(a) Restrictions on Public Sale by Holders.............12
(b) Restrictions on Public Sale by Funding and TCHI....13
6. Registration Procedures........................................13
7. Indemnification; Contribution..................................19
(a) Indemnification by Funding, TCHI and the
Partnership .......................................19
(b) Indemnification by Holders, Underwriters, Etc......20
(c) Conduct of Indemnification Proceedings.............21
(d) Contribution.......................................22
8. Rule 144 and Rule 144A.........................................23
9. Miscellaneous..................................................24
(a) No Inconsistent Agreements.........................24
(b) Amendments and Waivers.............................24
(c) Notices............................................24
(d) Successors and Assigns.............................25
(e) Counterparts.......................................25
(f) Headings...........................................25
(g) Governing Law......................................25
(h) Severability.......................................25
(i) Specific Performance...............................25
(j) Entire Agreement...................................26
(k) Securities Held by Funding or Its Respective
Affiliates.......................................26
-i-
<PAGE>
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered into
as of April 17, 1998, by and among Trump's Castle Funding, Inc., a New Jersey
corporation ("Funding"), Trump's Castle Hotel & Casino, Inc., a New Jersey
corporation ("TCHI"), Trump's Castle Associates, L.P. a New Jersey limited
partnership (the "Partnership"), and the purchasers listed on Exhibits A, B, C
and D hereto (herein referred to collectively as the "Funds" and each
individually as a "Fund").
This Agreement is made pursuant to the Note Purchase Agreement, dated the
date hereof, among Funding, TCHI, the Partnership and the Funds (the "Purchase
Agreement") which provides for the sale to the Funds of (i) Funding's 10 1/4%
Series A Senior Secured Notes due 2003, in an aggregate principal amount of
$62,000,000 unconditionally guaranteed by the Partnership, and (ii) the TCHI's
10 1/4% Series A Senior Secured Notes due 2003, in an aggregate principal amount
of $5,000,000 unconditionally guaranteed by the Partnership. In order to induce
the Funds to enter into the Purchase Agreement, Funding, TCHI and the
Partnership have agreed to provide the Funds with the registration and other
rights set forth in this Agreement. The execution of this Agreement is a
condition to the Funds' obligation to purchase the TCHI Notes and the Funding
Notes under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
1. Definitions.
As used in this Agreement, the following capitalized terms shall have the
meanings indicated below:
"Affiliate" shall have the meaning specified in the Funding Note
Indenture.
"Closing Date" shall have the meaning specified in the Purchase Agreement.
"Consummate" means, with respect to a Registered Exchange Offer hereunder,
(a) the filing and causing to become effective under the Securities Act of a
Registration Statement covering the Registered Exchange Offer, (b) the
maintenance of such Registration Statement continuously effective for the period
required by Section 2 hereof, (c) the delivery by Funding to the Registrar under
the Funding Note Indenture of the Series B Funding Notes in the same aggregate
principal amount as the aggregate principal amount of Series A Funding Notes
tendered by Holders pursuant to such Registered Exchange Offer, and (d) the
delivery by TCHI to the Registrar under the TCHI Note Indenture of the Series B
TCHI Notes in same aggregate principal amount as the aggregate principal amount
of the Series A TCHI Notes tendered by Holders pursuant to such Registered
Exchange Offer.
"Consummation Date" means October 19, 1998.
<PAGE>
"Effectiveness Date" means September 21, 1998, provided that if a Shelf
Notice is given fewer than 30 days prior to the Effectiveness Date, then the
Effectiveness Date shall be 90 days after the date of receipt of such notice.
"Event Date" shall have the meaning specified in Section 4(a) of this
Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.
"Exchange Registration Statement" means the registration statement (or
registration statements) registering the Registered Exchange Offer.
"Filing Date" means July 17, 1998; provided that if a Shelf Notice is
given fewer than 30 days prior to the Filing Date, the Filing Date shall be 30
days after the date of receipt of such notice.
"Funding" shall have the meaning specified in the preamble to this
Agreement and shall include Funding's successors.
"Funding Note Indenture" means the Indenture, dated as of the date hereof,
by and among Funding, the Partnership, and U.S. Bank National Association, as
trustee, governing the Series A Funding Notes and the Series B Funding Notes, as
the same may be amended and supplemented from time to time in accordance with
the terms thereof.
"Funding Notes" means the Series A Funding Notes and the Series B Funding
Notes.
"Funds" shall have the meaning specified in the preamble of this Agreement
and shall include the Funds' successors as holders of TCHI Notes and Funding
Notes.
"Guarantee" means the Partnership's senior guarantee of payment in respect
of the Funding Notes set forth in Article 14 of the Funding Note Indenture
and/or the Partnership's senior guarantee of payment in respect of the TCHI
Notes set forth in Article 14 of the TCHI Note Indenture.
"Holder" shall mean any holder of Registrable Series A TCHI Notes, Series
B TCHI Notes, Registrable Series A Funding Notes or Series B Funding Notes.
"Initial Shelf Registration" shall have the meaning specified in Section
3(a) hereof.
"Majority Holders" means Holders representing a majority of the aggregate
principal amount of outstanding Registrable Series A Funding Notes and Holders
of a majority of the aggregate principal amount of outstanding Registrable
Series A TCHI Notes, as applicable.
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<PAGE>
"NASD" means the National Association of Securities Dealers, Inc.
"Notes" means the Series A Notes and Series B Notes and any other debt
securities issued in exchange or substitution for the Series A Notes or the
Series B Notes.
"Partnership" shall have the meaning specified in the preamble to this
Agreement and shall include the Partnership's successors.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, limited liability
company, trust, or unincorporated organization, or a government or agency or
political subdivision thereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any Prospectus subject to completion, and any such
Prospectus as amended or supplemented by any prospectus supplement with respect
to the terms of the offering of any portion of (a) the Registrable Series A
Notes or (b) the Series B Notes pursuant to a Registered Exchange Offer, and, in
each case, by all other amendments and supplements to such Prospectus, including
post-effective amendments and all materials incorporated by reference therein.
"Purchase Agreement" shall have the meaning specified in the preamble of
this Agreement.
"Registered Exchange Offer" means the registration by (i) Funding and the
Partnership under the Securities Act of all the Series B Funding Notes and the
Guarantee thereof pursuant to a Registration Statement under which Funding
offers each Holder eligible to participate in such exchange offer the
opportunity to exchange all outstanding Registrable Series A Funding Notes held
by such Holder for Series B Funding Notes in an aggregate principal amount equal
to the aggregate principal amount of Registrable Series A Funding Notes held by
such Holder and (ii) by TCHI and the Partnership under the Securities Act of all
the Series B TCHI Notes and the Guarantee thereof pursuant to a Registration
Statement under which TCHI offers each Holder eligible to participate in such
exchange offer the opportunity to exchange all outstanding Registrable Series A
TCHI Notes held by such Holder for Series B TCHI Notes in an aggregate principal
amount equal to the aggregate principal amount of Registrable Series A TCHI
Notes held by such Holder.
"Registrable Series A Funding Notes" means the Series A Funding Notes upon
original issuance thereof, and at all times subsequent thereto, until, in the
case of any such Series A Funding Note, (i) a Registration Statement with
respect to such Series A Funding Note has been declared effective under the
Securities Act and such Series A Funding Note has been disposed of in accordance
with such Registration Statement; (ii) such Series A Funding Note is distributed
to the public pursuant to Rule 144 (or any successor provisions) promulgated
under the Securities Act; (iii) such Series A Funding Note has been otherwise
transferred and new
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<PAGE>
certificates for them not bearing a legend restricting further transfer shall
have been delivered by Funding; or (iv) such Series A Funding Note ceases to be
outstanding.
"Registrable Series A Notes" means the Registrable Series A Funding Notes
and the Registrable Series A TCHI Notes.
"Registrable Series A TCHI Notes" means the Series A TCHI Notes upon
original issuance thereof, and at all times subsequent thereto, until, in the
case of any such Series A TCHI Note, (i) a Registration Statement with respect
to such Series A Note has been declared effective under the Securities Act and
such Series A TCHI Note has been disposed of in accordance with such
Registration Statement; (ii) such Series A TCHI Note is distributed to the
public pursuant to Rule 144 (or any successor provisions) promulgated under the
Securities Act; (iii) such Series A TCHI Note has been otherwise transferred and
new certificates for them not bearing a legend restricting further transfer
shall have been delivered by TCHI; or (iv) such Series A TCHI Note ceases to be
outstanding.
"Registration Expenses" means any and all expenses incident to performance
of or compliance with this Agreement, including without limitation: (i) all SEC,
stock exchange or NASD registration and filing fees, including, if applicable,
the fees and expenses of any "qualified independent underwriter" (and its
counsel) that is required to be retained in accordance with the rules and
regulations of the NASD, (ii) all fees and expenses incurred in connection with
compliance with state securities or "blue sky" laws and compliance with the
rules of the NASD (including reasonable fees and disbursements of counsel in
connection with the NASD and "blue sky" qualification of any of the Registrable
Series A Notes and the preparation of a "blue sky" memorandum), (iii) all
expenses of any Persons in preparing or assisting in preparing, word processing,
printing and distributing any Registration Statement, any Prospectus, any
amendments or supplements thereto, any underwriting agreements, transmittal
letters, securities sales agreements, Note certificates and other documents
relating to the performance of and compliance with this Agreement, (iv) all fees
and expenses incurred in connection with the listing, if any, of any of the TCHI
Notes or Funding Notes on any securities exchange or exchanges pursuant to
Section 6 hereof, (v) the fees and disbursements of counsel for Funding, TCHI
and the Partnership and of the independent public accountants of Funding, TCHI,
the Partnership and the subsidiaries, including the expenses of any special
audits or "cold comfort" letters required by or incident to such performance and
compliance, (vi) the reasonable fees and disbursements of special counsel
representing the Holders (the "special counsel") that is reasonably acceptable
to the Partnership, Funding and TCHI, (vii) the fees and expenses of the
Trustee, and any escrow agent or custodian, and (viii) any fees and
disbursements of the Underwriters customarily required to be paid by issuers or
sellers of securities and the reasonable fees and expenses of any special
experts retained by Funding, TCHI and the Partnership in connection with any
Registration Statement, but excluding underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of Registrable
Series A Notes by a Holder. In connection with any Registration Statement
hereunder, Funding, TCHI and the Partnership shall reimburse the Holders of the
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<PAGE>
Registrable Series A Notes being registered in such registration for the
reasonable fees and disbursements of special counsel chosen by the Majority
Holders.
"Registration Statement" means any registration statement of Funding, TCHI
and/or the Partnership on an appropriate form pursuant to the Securities Act
which covers any of the Registrable Series A Notes or the Series B Notes, as the
case may be, and all amendments and supplements to any such Registration
Statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein.
"Required Registration" shall have the meaning specified in Section 3(d)
of this Agreement.
"Required Registration Date" shall have the meaning specified in Section
3(d) of this Agreement.
"Required Registration Statement" means a Registration Statement which
covers any of the Registrable Series A Notes pursuant to the provisions of
Section 3(d) of this Agreement.
"SEC" means the Securities and Exchange Commission.
"Section 3(d) Notice" shall have the meaning specified in Section 3(d) of
this Agreement.
"Securities" means the Series A Notes and the Series B Notes.
"Securities Act" means the Securities Act of 1933, as amended from time to
time.
"Series A Funding Notes" means Funding's 10 1/4% Series A Senior Secured
Notes due 2003, sold pursuant to the Purchase Agreement and issued in accordance
with the Funding Note Indenture in the original aggregate principal amount of
$62,000,000.
"Series A Notes" means the Series A Funding Notes and/or the Series A TCHI
Notes, as applicable.
"Series A TCHI Notes" means TCHI's 10 1/4% Series A Senior Secured Notes
due 2003, sold pursuant to the Purchase Agreement and issued in accordance with
the TCHI Note Indenture in the original aggregate principal amount of
$5,000,000.
"Series B Funding Notes" means Funding's 10 1/4% Series B Senior Secured
Notes due 2003, issued in accordance with the Funding Note Indenture.
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<PAGE>
"Series B Notes" means the Series B Funding Notes and/or the Series B TCHI
Notes, as applicable.
"Series B TCHI Notes" means TCHI's 10 1/4% Series B Senior Secured Notes
due 2003, issued in accordance with the TCHI Note Indenture.
"Shelf Effectiveness Period" shall have the meaning specified in Section
3(a) of this Agreement.
"Shelf Notice" shall have the meaning specified in Section 2(e) of this
Agreement.
"Shelf Registration" shall have the meaning specified in section 3(b) of
this Agreement.
"Shelf Registration Statement" shall have the meaning specified in Section
3(a) of this Agreement.
"Subsequent Shelf Registration" shall have the meaning specified in
Section 3(b) of this Agreement.
"TIA" shall have the meaning specified in Section 6(o) of this Agreement.
"TCHI" shall have the meaning specified in the preamble of this Agreement
and shall include TCHI's successors.
"TCHI Note Indenture" means the Indenture, dated as of the date hereof, by
and among TCHI, the Partnership and U.S. Bank National Association, as trustee,
governing the Series A TCHI Notes and the Series B TCHI Notes, as the same may
be amended and supplemented from time to time in accordance with the terms
thereof.
"TCHI Notes" means the Series A TCHI Notes and the Series B TCHI Notes.
"Trustee" means U.S. Bank National Association, in its capacity as the
trustee under the Funding Note Indenture and/or in its capacity as the trustee
under the TCHI Note Indenture, as applicable.
"Underwritten Offering" means a sale of securities of Funding and/or TCHI
to an Underwriter or Underwriters for reoffering to the public.
"Weekly Liquidated Damages Amount" shall have the meaning specified in
Section 4(a) of this Agreement.
6
<PAGE>
2. Registered Exchange Offer.
(a) The Partnership and each of Funding and TCHI shall cause to be filed,
as soon as reasonably practicable after the Closing Date but in no event later
than the Filing Date, a Registration Statement (or Registration Statements) with
respect to the Registered Exchange Offer and shall use its reasonable best
efforts to cause (A) such Registration Statement (or Registration Statements) to
be declared effective on or prior to the Effectiveness Date; (B) Series B Notes
to be delivered to the Registrar under the Funding Note Indenture (in the case
of the Series B Funding Notes) and the Registrar under the TCHI Note Indenture
(in the case of the Series B TCHI Notes) for delivery to all Holders who have
tendered Registrable Series A Notes pursuant to the Registered Exchange Offer
and (C) the Registered Exchange Offer to be consummated by the Consummation
Date.
(b) Funding, in the case of the Funding Notes, and TCHI, in the case of
the TCHI Notes, shall deliver written notice that a Registration Statement filed
in connection with a Registered Exchange Offer is effective to each Fund and
each other Holder known to it (after due inquiry) promptly after receiving
notice of effectiveness from the SEC. Neither Funding, TCHI nor the Partnership
shall permit any securities other than the Series B Notes to be included in such
Registration Statement (or Registration Statements). Funding, TCHI and the
Partnership shall use their best efforts to cause the Registration Statement (or
Registration Statements) relating to the Registered Exchange Offer to be
continuously effective for a period of not less than twenty (20) consecutive
Business Days; provided, however, that the Registered Exchange Offer shall
remain open and the Registration Statement (or Registration Statements) relating
to the Registered Exchange Offer shall remain effective, for a period not less
than the period required under applicable federal and state securities laws.
Funding, TCHI and the Partnership shall supplement or amend the Registration
Statement (or Registration Statements) filed in respect of the Registered
Exchange Offer to the extent required by applicable law, rules or regulations,
or by the instructions applicable to the registration form used by Funding, TCHI
and the Partnership for such Registration Statement (or Registration
Statements).
(c) Each Holder who participates in the Registered Exchange Offer will be
deemed to represent that at the time of the Consummation of the Registered
Exchange Offer (i) such Holder will not be an Affiliate of Funding, TCHI or the
Partnership, (ii) any Series B Notes received by such Holder will be acquired in
the ordinary course of its business, and (iii) such Holder will have no
agreement or understanding with any person to participate in the distribution
within the meaning of the Securities Act or the resale of the Series B Notes
received by such Holder in violation of the Securities Act or the Exchange Act.
Upon the consummation of the Registered Exchange Offer in accordance with this
Section 2 and the delivery of the Series B Notes such that they are freely
tradeable by the Holders thereof under state and Federal securities laws, the
provisions of this Agreement shall continue to apply mutatis mutandis, provided
that (i) solely with respect to Registrable Series A Notes, Funding, TCHI and
the Partnership may omit to comply with such of the procedures set forth in
Section 6 hereof as are required to be complied with only in connection with a
Shelf Registration or as
7
<PAGE>
would not adversely affect the interests of the Funds under this Agreement, and
(ii) neither Funding, TCHI nor the Partnership shall have any further obligation
to register Registerable Series A Notes pursuant to Section 3 of this Agreement.
(d) Expenses. Funding, TCHI and the Partnership shall pay all Registration
Expenses in connection with the Registered Exchange Offer.
(e) If (1) prior to the Consummation of the Registered Exchange Offer,
Funding (in the case of the Funding Notes) or TCHI (in the case of the TCHI
Notes), on the one hand, or the relevant Majority Holders, on the other hand,
reasonably determine in good faith that (i) the Series B Notes received by such
Holders of Registrable Series A Notes in the Registered Exchange Offer would
not, upon receipt, be tradeable by each such Holder (other than a Holder which
is an Affiliate of Funding or the Partnership) without restriction under the
Securities Act and the Exchange Act and without material restrictions under the
blue sky or securities laws of substantially all of the states of the United
States of America (except with respect to the prospectus delivery requirement of
a participating broker-dealer), or (ii) the Consummation of a Registered
Exchange Offer would have a material adverse effect on the Holders of
Registrable Series A Notes, taken as a whole, or (iii) after conferring with
counsel, the SEC would not permit Consummation of the Registered Exchange Offer
prior to the Effectiveness Date or (2) the Registered Exchange Offer is
commenced but not consummated within 120 days after commencement thereof for any
reason, then Funding and/or TCHI, as applicable, and the Partnership shall
promptly deliver to the Holders and to the applicable Trustee or Trustees notice
thereof (the "Shelf Notice") and withdraw the Registered Exchange Offer with
respect to the Funding Notes and/or the TCHI Notes, as the case may be, and
shall thereafter file a Shelf Registration pursuant to Section 3.
3. Shelf Registration.
If a Shelf Notice is delivered as provided in Section 2(e) hereof, then:
(a) Initial Shelf Registration. Funding and/or TCHI, as applicable, and
the Partnership shall file a "shelf" Registration Statement (or "Shelf"
Registration Statements) for offerings to be made on a continuous basis pursuant
to Rule 415 under the Securities Act (as such Rule may be amended from time to
time, or any similar rule or regulation adopted by the SEC) covering all of the
Registrable Series A Notes (or if the Shelf Notice is delivered only with
respect to the Funding Notes or the TCHI Notes, covering all Registrable Series
A Funding Notes or all Registrable Series A TCHI Notes, as the case may be)
prior to the Filing Date (the "Initial Shelf Registration"). If Funding and/or
TCHI, as applicable, and the Partnership shall not yet have filed a Registration
Statement for the Registered Exchange Offer, Funding and/or TCHI, as applicable,
and the Partnership shall use their respective best efforts to file with the SEC
the Initial Shelf Registration on or prior to the Filing Date. Neither Funding,
TCHI nor the Partnership shall permit any securities other than the Registrable
Series A Notes to be included in the Initial Shelf Registration or any
Subsequent
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Shelf Registration. Funding and/or TCHI, as applicable, and the Partnership
shall use their respective best efforts to cause the Initial Shelf Registration
to be declared effective under the Securities Act on or prior to the
Effectiveness Date and to keep the Initial Shelf Registration continuously
effective until the date which is 24 months from the date upon which the Shelf
Registration is declared effective (the "Shelf Effectiveness Period") or, if
earlier, until all of the Registrable Series A Notes covered by the Shelf
Registration Statement have been sold pursuant to the Shelf Registration
Statement.
(b) Subsequent Shelf Registrations. If the Initial Shelf Registration or
any Subsequent Shelf Registration (as defined below) ceases to be effective for
any reason at any time during the Shelf Effectiveness Period (other than because
of the sale of all of the securities registered thereunder or as a result of a
post-effective amendment to such Registration Statement being declared
effective), Funding and/or TCHI, as applicable and the Partnership shall use
their respective best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 45 days of
such cessation of effectiveness amend the Shelf Registration in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional "shelf" Registration Statement
pursuant to Rule 415 covering all of the Registrable Series A Notes (or, if the
order suspending effectiveness applies only with respect to a Shelf Registration
Statement covering only the Registrable Series A Funding Notes or only the
Registrable Series A TCHI Notes, covering all Registrable Series A Funding Notes
or all Registrable Series A TCHI Notes, as the case may be) (a "Subsequent Shelf
Registration"). If a Subsequent Shelf Registration is filed, Funding and/or
TCHI, as applicable, and the Partnership shall use their respective best efforts
to cause the Subsequent Shelf Registration to be declared effective as soon as
practicable after such filing and to keep such Registration Statement
continuously effective for a period equal to the number of days in the Shelf
Effectiveness Period less the aggregate number of days during which the Initial
Shelf Registration or any Subsequent Shelf Registration was previously
continuously effective. As used herein the term "Shelf Registration" means the
Initial Shelf Registration Statement and any Subsequent Shelf Registration.
(c) Supplements and Amendments. Funding and/or TCHI, as applicable, and
the Partnership shall promptly supplement and amend the Shelf Registration if
required by the rules, regulations or instructions applicable to the
registration form used for such Shelf Registration, if required by the
Securities Act, or if requested by the holders of a majority in aggregate
principal amount of the Registerable Series A Notes covered by such Registration
Statement or by any underwriter of such Registrable Series A Notes (except to
the extent any such supplement or amendment so requested would in the judgment
of the Funding and/or TCHI, as applicable, and the Partnership make the
statements therein misleading).
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<PAGE>
(d) Required Subsequent Registration.
(i) Required Subsequent Registration. If, after the termination of
the Shelf Effectiveness Period, for any reason Rule 144(k) or any successor rule
under the Securities Act shall not be available to permit the resale of the
Registrable Series A Notes by any Holder without registration under the
Securities Act, then, within 90 days after termination of the Shelf
Effectiveness Period (the "Required Registration Date"), Funding and/or TCHI, as
applicable, and the Partnership will give written notice (a "Section 3(d)
Notice") to all Holders of Registrable Series A Notes of its intention to effect
the registration under the Securities Act of any Registrable Series A Notes
which Holders wish to have so registered (a "Required Registration"). The
Section 3(d) Notice shall specify the procedures which a Holder shall follow to
request inclusion of the Holder's Registrable Series A Notes. For a period of 30
calendar days after the date the Section 3(d) Notice is given, Holders shall
have the right to request in writing that Funding and/or TCHI, as applicable,
and the Partnership include such Holders' Registrable Series A Notes in the
Required Registration Statement. If the Majority Holders have requested
inclusion of such Holders' Registerable Series A Notes in a registration
statement, then not later than 90 calendar days after giving the Section 3(d)
Notice, Funding and/or TCHI, as applicable, and the Partnership shall file a
Required Registration Statement covering all of the Registrable Series A Notes
requested by the Holders thereof to be included therein and have such Required
Registration Statement declared effective as promptly as practicable (but in no
event later than 180 calendar days after the giving of the request by the
Holders described above) and use their best efforts to keep such Required
Registration Statement continuously effective for a period of at least 180
calendar days following the date on which such Required Registration Statement
is declared effective or, if earlier, until all of the Registrable Series A
Notes covered by such Required Registration Statement have been sold pursuant
thereto. In lieu of filing the Required Registration Statement, Funding and/or
TCHI, as applicable, and the Partnership may, in their sole discretion and if
permitted by applicable law, keep a Shelf Registration continuously effective
for an additional period of at least 180 calendar days after termination of the
Shelf Effectiveness Period or, if earlier, until all of the Registrable Series A
Notes which would otherwise have been covered by such Required Registration
Statement have been sold pursuant to such Shelf Registration Statement.
(ii) Expenses. Funding, TCHI and the Partnership shall pay all
Registration Expenses in connection with the Required Registration. Each Holder
requesting a Required Registration pursuant to Section 3(d)(i) of this Agreement
shall pay all underwriting discounts and commissions and transfer taxes, if any,
relating to the sale or disposition of such Holders' Registrable Series A Notes
pursuant to such Required Registration.
(iii) Priority in Required Registrations. If a Required Registration
involves an Underwritten offering of the securities so being registered, which
securities are to be distributed on a firm commitment basis by or through one or
more Underwriters of recognized standing pursuant to underwriting terms
appropriate for such transaction, and the sole or managing Underwriter, as the
case may be, of such Underwritten Offering shall advise
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Funding and/or TCHI, as applicable in writing (with a copy to each Holder
requesting registration) that, in its opinion, the amount of securities
requested to be included in such Required Registration exceeds the amount which
can be sold in (or during the time of) such offering within a price range
acceptable to the Holders who have requested that their Registrable Series A
Funding Notes or Registrable Series A TCHI Notes, as the case may be, be
included in such registration, then the amount of Registrable Series A Notes to
be offered for the accounts of Holders thereof shall be reduced pro rata based
upon the relative aggregate amount of gross proceeds to be received by such
Holders in the offering of Registrable Series A Funding Notes or Registrable
Series A TCHI Notes, as the case may be, to the extent necessary to reduce the
total amount of securities to be included in such offering to the amount that
Funding and/or TCHI is so advised can be sold in (or during the time of) such
offering.
4. Liquidated Damages.
(a) Funding, TCHI, the Partnership and the Funds agree that the Holders of
Registrable Series A Notes will suffer damages if Funding, TCHI and the
Partnership fail to fulfill their obligations under Section 2 or Section 3
hereof and that it would not be feasible to ascertain the extent of such damages
with precision. Accordingly, if with respect to the Funding Notes and/or the
TCHI Notes (i) the Exchange Registration Statement and/or the Initial Shelf
Registration has not been filed on or prior to the Filing Date, (ii) (x) the
Initial Shelf Registration has not become effective on or prior to the
Effectiveness Date and/or (y) (A) the Registration Statement with respect to the
Registered Exchange Offer has not been declared effective on or prior to the
Effectiveness Date or (B) the Registered Exchange Offer has not been Consummated
on or prior to the Consummation Date, (iii) prior to the end of the Shelf
Effectiveness Period, the SEC shall have issued a stop order suspending the
effectiveness of the Initial Shelf Registration or any Subsequent Shelf
Registration or (iv) a notice under Section 6(e)(vi) hereof is effective or
required to be effective at a time when the aggregate number of days for which
all such notices issued or required to be issued pursuant to Section 6(e)(vi)
hereof have been, or were required to be, in effect exceeds 60 days, whether or
not consecutive (the Filing Date in the case of clause (i), the Effectiveness
Date and the Consummation Date in the case of clause (ii), the date on which the
Registration Statement ceases to be effective in the case of clause (iii), and
the date on which the 60-day limit is exceeded in the case of clause (iv), each
being referred to herein as an "Event Date"), then in the case of the Funding
Notes, Funding and the Partnership jointly and severally, and in the case of the
TCHI Notes, TCHI and the Partnership, jointly and severally, agree to pay, or
cause to be paid, in addition to amounts otherwise due under the Funding Note
Indenture (in the case of Registrable Series A Funding Notes), the TCHI Note
Indenture (in the case of Registrable Series A TCHI Notes) and the applicable
Registrable Series A Notes, as liquidated damages, and not as a penalty, to each
Holder of Registrable Series A Funding Notes (in the case of any such
registration default relating to the Funding Notes) and/or Registrable Series A
TCHI Notes (in the case of any such registration default relating to the TCHI
Notes), as the case may be, an additional amount (the "Weekly Liquidated Damages
Amount") equal to (a) for each weekly period (or part thereof) from and
including the Event Date, $0.05 per week
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per $1,000 principal amount of the applicable Registrable Series A Notes held by
such Holder, and (b) beginning the 61st day after the Event Date, the Weekly
Liquidated Damages Amount shall be increased by an additional $0.05 per week (or
part thereof) per $1,000 principal amount of Registrable Series A Notes held by
such Holder; provided that such liquidated damages will, in each case, cease to
accrue on the date on which (w) the applicable Exchange Registration Statement
or the Initial Shelf Registration, as the case may be, is filed or the Initial
Shelf Registration or the Registered Exchange Offer, as the case may be, is
declared effective, with respect to liquidated damages for failure to be filed
by the Filing Date or declared effective by the Effectiveness Date, as the case
may be, (x) the Consummation of the Exchange Offer with respect to liquidated
damages for failure to Consummate the Registered Exchange Offer on or prior to
the Effective Date, (y) the applicable Shelf Registration is no longer subject
to an order suspending the effectiveness thereof or a new Subsequent Shelf
Registration is declared effective, with respect to liquidated damages for the
failure to remain effective or (z) a notice issued, or required to be issued,
pursuant to Section 6(e)(vi) is no longer effective or required to be effective,
with respect to liquidated damages payable pursuant to clause (iv) above.
(b) Funding and/or TCHI, as applicable, and the Partnership shall notify
the applicable Trustee or Trustees within five Business Days after each and
every Event Date. In the case of the Funding Notes, Funding and the Partnership
jointly and severally, and, in the case of the TCHI Notes, TCHI and the
Partnership, jointly and severally, shall pay the liquidated damages due on the
Registrable Series A Notes by depositing with the Trustee, in trust, for the
benefit of the Holders thereof, on or before the applicable semi-annual interest
payment date, immediately available funds in sums sufficient to pay the
liquidated damages then due to Holders of Registrable Series A Notes with
respect to which the Trustee serves. The liquidated damages amount due shall be
payable on each interest payment date to the record Holder of Registrable Series
A Notes entitled to receive the interest payment to be made on such date as set
forth in the Indenture. Each obligation to pay liquidated damages shall be
deemed to accrue on the applicable Event Date. The parties hereto agree that the
liquidated damages provided for in this Section 4 constitute a reasonable
estimate of the damages that may be incurred by Holders of Registrable Series A
Notes by reason of the failure of a Shelf Registration and/or Exchange Offer to
be filed or declared effective, or a Shelf Registration to remain effective, as
the case may be in accordance with this Section 4.
5. Hold-Back Agreements.
(a) Restrictions on Public Sale by Holders. Each Holder whose Registrable
Series A Notes are covered by a Registration Statement filed pursuant to Section
2 or 3 hereof agrees not to effect any public sale or distribution of any
securities of Funding or the Partnership of the same or similar class or classes
as the securities included in the Registration Statement or any securities
convertible into or exchangeable or exercisable for such securities, including a
sale pursuant to Rule 144 or Rule 144A under the Securities Act, during the
15-day period prior to, and during the 90-day period beginning on, the effective
date of such Registration
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Statement (except pursuant to such Registration Statement) if and to the extent
requested in writing (with reasonable prior notice) by Funding or TCHI, as
applicable, and the Partnership, in the case of a public offering that is not an
Underwritten Offering, or by the sole or managing Underwriter, in the case of an
Underwritten Offering.
(b) Restrictions on Public Sale by Funding and TCHI. Funding, TCHI and the
Partnership agree not to effect any public sale or distribution of any
securities which are the same as or substantially similar to those Registrable
Series A Notes being registered pursuant to a Registration Statement filed
pursuant to Section 3 hereof, including a sale pursuant to Regulation D under
the Securities Act, or any securities convertible into or exchangeable or
exercisable for such securities during the 15-day period prior to, and during
the 90-day period beginning on, the effective date of such Registration
Statement (except pursuant to such Registration Statement on Form S-4 or any
successor to such Form).
6. Registration Procedures.
Whenever any Registrable Series A Notes are to be registered pursuant to
Sections 2 or 3 of this Agreement, Funding, TCHI and the Partnership shall use
their reasonable best efforts to effect or cause to be effected such
registration in a manner which will permit the exchange or sale of such
Registrable Series A Notes by the Holders thereof in accordance with their
intended method or methods of distribution, and Funding, TCHI and the
Partnership shall (to the extent applicable), as expeditiously as possible:
(a) prepare and file a Registration Statement with the SEC and cause each
such Registration Statement to become and remain effective, within the
applicable time periods specified herein, which Registration Statement (x) shall
be on an appropriate registration form under the Securities Act, selected by
Funding and/or TCHI, as applicable, and the Partnership and shall be reasonably
acceptable to the special counsel for the Holders, (y) shall be available for
the sale or exchange of the Registrable Series A Notes in accordance with the
intended method or methods of distribution by the selling or exchanging Holders
thereof, and (z) shall comply as to form in all material respects with the
requirements of the applicable form under the Securities Act and include all
financial statements required by the SEC to be filed therewith;
(b) prepare and file with the SEC such amendments and post-effective
amendments to each such Registration Statement as may be necessary to keep such
Registration Statement effective for the applicable time period hereunder; cause
each related Prospectus to be supplemented by any required prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 (or any
similar provision then in force) under the Securities Act; and comply with the
provisions of the Securities Act, the Exchange Act and the rules and regulations
promulgated thereunder with respect to the disposition of all securities covered
by each Registration Statement during the applicable period in accordance with
the intended method or methods of distribution by the selling holders thereof;
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(c) if a Registration Statement is filed pursuant to Section 3, furnish to
each Holder and to each Underwriter of an Underwritten offering of Registrable
Series A Notes, if any, without charge, as many copies of each Prospectus,
including each Prospectus subject to completion, and any amendment or supplement
thereto and such other documents as such Holder or Underwriter may reasonably
request, in order to facilitate the public sale or other disposition of the
Registrable Series A Notes; Funding, TCHI and the Partnership consent to the use
of the Prospectus, including each Prospectus subject to completion, by each
Holder and each Underwriter of an Underwritten Offering of Registrable Series A
Notes, if any, in connection with the offering and sale of the Registrable
Series A Notes covered by such Prospectus or Prospectus subject to completion;
(d) on or prior to the date on which such Registration Statement is
declared effective, register or qualify, and cooperate with each Holder of
Registrable Series A Notes covered by such Registration Statement, each
Underwriter, if any, and their respective counsel in registering or qualifying
the Registrable Series A Notes under all applicable state securities or "blue
sky" laws of such jurisdictions as each such Underwriter, if any, or any such
Holder shall reasonably request in writing (provided that neither Funding, TCHI
or the Partnership shall be required to register or qualify as a foreign
corporation or foreign limited partnership where it is not now so qualified or
take any action that would subject it to service of process in suits or to
taxation in any jurisdiction where it is not now so subject), keep each such
registration or qualification effective during the period such Registration
Statement is required to be kept effective and do any and all other acts and
things which may be reasonably necessary or advisable to enable such
Underwriter, if any, and such Holders to consummate the disposition in each such
jurisdiction of Registrable Series A Notes covered by such Registration
Statement;
(e) notify each Holder of Registrable Series A Notes covered by such
Registration Statement (to the extent known after due inquiry), each
Underwriter, if any, and their respective counsel promptly, and confirm such
notice in writing (i) when such Registration Statement has become effective and
when any post-effective amendments and supplements thereto become effective or
any supplement to the Prospectus or amendment Prospectus shall have been filed,
(ii) of the issuance by the SEC or any state securities authority of any stop
order suspending the effectiveness of such Registration Statement or preventing
or prohibiting the use of any Prospectus (including any Prospectus subject to
completion) or the initiation of any proceedings for any such purpose, (iii) of
the receipt of comments from the SEC with respect to such Registration
Statement, (iv) if, between the effective date of such Registration Statement
and the closing of any sale of securities covered thereby, the representations
and warranties of Funding or the Partnership contained in the underwriting
agreement or other agreement contemplated by Section 6(k) hereof, if any,
relating to the offering cease to be true and correct in all material respects,
(v) if Funding or the Partnership receives any notification with respect to the
suspension of the qualification of the Registrable Series A Notes for sale in
any jurisdiction or the initiation of any proceeding for such purpose, and (vi)
of the happening of any event during the period such Registration Statement is
effective as a result of which
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such Registration Statement or the related Prospectus contains any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading or, in Funding's or the
Partnership's reasonable determination, a post-effective amendment to such
Registration Statement would be appropriate;
(f) furnish special counsel for the Holders of Registrable Series A Notes
covered by such Registration Statement and each Underwriter, if any, with copies
of any request by the SEC or any state securities authority for amendments or
supplements to such Registration Statement or any Prospectus or for additional
information;
(g) make every reasonable effort to prevent the issuance of any order
suspending the effectiveness of a Registration Statement or of any order
preventing or suspending the use of a Prospectus or suspending the qualification
(or exemption from qualification) of any of the Registrable Series A Notes for
sale in any jurisdiction, and, if any such order is issued, to obtain promptly
the withdrawal of any such order;
(h) upon request, furnish to the Underwriter or managing Underwriter of
any Underwritten Offering of Registrable Series A Notes, if any, without charge,
with at least one signed copy of each Registration Statement and any
post-effective amendment thereto, including financial statements and schedules,
all documents incorporated therein by reference and all exhibits; and furnish to
each Holder, without charge, one conformed copy of each Registration Statement
and any post-effective amendment thereto, including financial statements and
schedules, (but not including documents incorporated therein by reference or
exhibits thereto, unless requested);
(i) if a Registration Statement is filed pursuant to Section 3, cooperate
with the selling Holders and the Underwriter or managing Underwriter of an
Underwritten Offering of Registrable Series A Notes, if any, to facilitate the
timely preparation and delivery of certificates (not bearing any restrictive
legends) representing Registrable Series A Notes to be sold; and issue such
Registrable Series A Notes to be sold in such denominations (consistent with the
provisions of the Funding Note Indenture or the TCHI Note Indenture, as the case
may be) and registered in such names as the selling Holders or the Underwriter
or managing Underwriter of an underwritten offering of Registrable Series A
Notes, if any, may reasonably request at least three business days prior to any
sale of Registrable Series A Notes;
(j) upon the occurrence of any event contemplated by Section 6(e)(vi)
hereof, prepare a supplement or post-effective amendment to a Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Series A Notes, such Registration Statement
will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading and in Funding's
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and/or TCHI's, as applicable, and the Partnership's reasonable determination a
post-effective amendment to such Registration Statement is no longer
appropriate;
(k) if a Registration Statement is filed pursuant to Section 3, enter into
customary agreements (including underwriting agreements) and take all other
customary and appropriate actions in order to expedite or facilitate the
disposition of such Registrable Series A Notes and in such connection whether or
not an underwriting agreement is entered into and whether or not the
registration is an Underwritten offering:
(1) to the extent Funding, TCHI and the Partnership is able, make
such representations and warranties to the Holders and the Underwriters,
if any, in form, substance and scope as are customarily made by issuers to
underwriters in similar primary underwritten offerings and covering
matters including, but not limited to, those set forth in the Purchase
Agreement;
(2) obtain opinions of counsel to Funding, TCHI and the Partnership
and updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the managing Underwriters,
if any, and the special counsel for the Holders of the Registrable Series
A Notes being sold) addressed to each selling Holder and the Underwriters,
if any, covering the matters customarily covered in opinions requested in
similar sales of securities or underwritten offerings and such other
matters as may be reasonably requested by such Holders and Underwriters;
(3) obtain "cold comfort" letters and updates thereof from the
independent certified public accountants of Funding, TCHI, the Partnership
and each of their Subsidiaries addressed to the selling Holders of
Registrable Series A Notes and the Underwriters, if any, such letters to
be in customary form and covering matters of the type customarily covered
in "cold comfort" letters to underwriters in connection with primary
underwritten offerings;
(4) enter into a securities sales agreement with the Holders
relating to such registration and providing for, among other things, the
appointment of the Underwriter as agent for the selling Holders for the
purpose of soliciting purchases of Registrable Series A Notes, which
agreement shall be customary in form, substance and scope and shall
contain customary representations, warranties and covenants;
(5) if an underwriting agreement is entered into, cause the same to
set forth indemnification provisions and procedures substantially
equivalent to the indemnification provisions and procedures set forth in
Section 7 hereof with respect to all parties to be indemnified pursuant to
said Section; and
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(6) deliver such other documents and certificates as may be
reasonably requested by the Holders of a majority in principal amount of
the Registrable Series A Notes being sold and the managing Underwriters,
if any.
The above shall be done at (i) the effectiveness of such Registration Statement
(and each post-effective amendment thereto) and (ii) each closing under any
underwriting or similar agreement as and to the extent required thereunder;
(l) make available for inspection by representatives of the Holders of the
Registrable Series A Notes and any Underwriters participating in any disposition
pursuant to a Registration Statement, and any special counsel or accountant
retained by such Holders or Underwriters, at the offices where normally kept
during normal business hours, all financial and other records, pertinent
corporate documents and properties of Funding, TCHI, the Partnership and their
Subsidiaries, and cause their officers, directors and employees to supply all
information reasonably requested by any such representative, Underwriter,
special counsel or accountant in connection with a Registration Statement;
provided, however, that such records, documents or information which Funding,
TCHI and the Partnership determine, in good faith, to be confidential and
notifies such representatives, Underwriters, special counsel or accountants in
writing are confidential shall not be disclosed by the representatives,
Underwriters, special counsel or accountants unless (i) the disclosure of such
records, documents or information is necessary to avoid or correct a
misstatement or omission in a Registration Statement, (ii) the release of such
records, documents or information is ordered pursuant to a subpoena or other
order from a court of competent jurisdiction, or (iii) such records, documents
or information have been generally made available to the public other than as a
result of a disclosure or failure to safeguard by such person;
(m) (i) a reasonable time prior to the filing of any Registration
Statement, any Prospectus, any amendment to a Registration Statement or
amendment or supplement to a Prospectus, provide copies of such document to the
Holders, to the special counsel on behalf of the Holders and to the Underwriter
or Underwriters of an Underwritten offering of Registrable Series A Notes, if
any, make such changes in any such document prior to the filing thereof as the
special counsel to the Holders or the Underwriter or Underwriters, may
reasonably request and not file any such document in a form to which the
Holders, or any Underwriter shall reasonably object, and make such of the
representatives of Funding, TCHI, and the Partnership available for discussion
of such document as shall be reasonably requested by the Holders, or any
Underwriter;
(ii) a reasonable time prior to the filing of any document which is
to be incorporated by reference into a Registration Statement or a Prospectus,
provide copies of such document to special counsel for the Holders, and make
such changes in such document prior to the filing thereof as such counsel or
counsel for any Underwriter shall reasonably request; and make such of the
representatives of Funding, TCHI, and the Partnership as shall be reasonably
requested by such special counsel available for discussion of such document;
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(n) provide a CUSIP number for all Registrable Series A Notes, not later
than the effective date of a Registration Statement;
(o) cause the Funding Note Indenture and the TCHI Note Indenture to be
qualified under the Trust Indenture Act of 1939, as amended from time to time
(the "TIA"), in connection with the registration of the Registrable Series A
Notes, cooperate with the Trustee under the Funding Note Indenture and the
Trustee under the TCHI Note Indenture and the holders of the Securities to
effect such changes to the respective indenture as may be required for such
indentures to be so qualified in accordance with the terms of the TIA and
execute, and cause the applicable Trustee to execute, all documents as may be
required to effect such changes, and all other forms and documents required to
be filed with the SEC to enable the respective indentures to be so qualified in
a timely manner;
(p) comply with all applicable rules and regulations of the SEC and make
available to its security holders, as soon as reasonably practicable an earnings
statement covering at least 12 months which shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
(q) if a registration statement is filed pursuant to Section 3, file and
keep continuously effective a "market making prospectus" with respect to the
outstanding Securities and deliver to the Underwriter such number of copies of
such prospectus as the Underwriter may reasonably request in the course of its
market making activities with respect to the Securities; and
(r) cooperate and assist in any filings required to be made with the NASD
and in the performance of any due diligence investigation by any Underwriter
(including any "qualified independent Underwriter" that is required to be
retained in accordance with the rules and regulations of the NASD).
Each selling Holder of Registrable Series A Notes as to which any
registration is being effected pursuant to this Agreement agrees, as a condition
to the registration obligations of TCHI, Funding and the Partnership provided
herein, to furnish to Funding, TCHI and the Partnership such information
regarding the proposed distribution by such Holder as Funding, TCHI and the
Partnership may from time to time reasonably request in writing.
Each Holder agrees that, upon receipt of any notice from Funding or TCHI
of the happening of any event of the kind described in Section 6(e)(vi) hereof,
such Holder will forthwith discontinue disposition of Registrable Series A Notes
pursuant to a Registration Statement until such Holder's receipt of the copies
of the supplemented or amended Prospectus contemplated by Section 6(j) hereof,
and, if so directed by Funding or TCHI such Holder will deliver to Funding or
TCHI as applicable (at the expense of Funding or TCHI, as applicable, or the
Partnership), all copies in its possession, other than permanent file copies
then in such Holder's possession, of the Prospectus covering such Registrable
Series A Notes current at the
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time of receipt of such notice. If Funding, TCHI or the Partnership shall give
any such notice to suspend the disposition of Registrable Series A Notes
pursuant to a Registration Statement, Funding and/or TCHI, as applicable, and
the Partnership shall extend the period during which the Registration Statement
shall be maintained effective pursuant to this Agreement by the number of days
in the period from and including the date of the giving of such notice to and
including the date when the Holders shall have received copies of the
supplemented or amended Prospectus necessary to resume such dispositions.
In connection with the filing of a Registration Statement under this
Agreement, Funding or TCHI, as applicable, and the Partnership may elect to have
all Registrable Series A Funding Notes or all Registrable Series A TCHI Notes or
all Series B Funding Notes or all Series B TCHI Notes, as the case may be, in
definitive form or book-entry form, and each Holder will be required to convert
its Security into a definitive form Security or a book-entry form Security, as
the case may be, in accordance with the provisions set forth in the Funding Note
Indenture (in the case of Funding Notes) and the TCHI Note Indenture (in the
case of the TCHI Notes).
If the Majority Holders request at any time, in connection with the filing
of a Registration Statement under this Agreement or otherwise, that the Series B
Notes or Registrable Series A Notes be listed on the American Stock Exchange or
another securities exchange, TCHI, Funding and the Partnership shall as
expeditiously as possible take all reasonable steps to cause such Notes to be so
listed.
7. Indemnification; Contribution.
(a) Indemnification by Funding, TCHI and the Partnership. Funding, TCHI
and the Partnership, jointly and severally, shall without limitation as to time
indemnify and hold harmless each Holder and each of their respective Affiliates
(including any director, officer, trustee, employee agent or attorney of such
Holder or Person, if any, who controls any Holder within the meaning of Section
15 of the Securities Act and any director, officer, trustee, employee, agent or
attorney for such controlling person) (each an "Indemnified Party"):
(i) against any and all loss, claim, damage, liability and expense
whatsoever, as incurred, arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement (or any amendment thereto), or arising out of or based upon any
omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of or
based upon any untrue statement or alleged untrue statement of a material fact
contained in any Prospectus or including any Prospectus subject to completion
(or any amendment or supplement thereto), or arising out of or based upon any
omission or alleged omission of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
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(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with
the written consent of Funding, TCHI or the Partnership; and
(iii) against any and all expense whatsoever, as incurred
(including, subject to the provisions of Section 7(c) below, reasonable
fees and disbursements of counsel), reasonably incurred in investigating,
preparing or defending against any litigation, or investigation or
proceeding by any governmental agency or body, commenced or threatened, in
each case whether or not a party, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under
subparagraph (i) or (ii) above;
provided, however, that Funding, TCHI and the Partnership shall not be liable in
any such case to any Indemnified Party to the extent that any such loss, claim,
damage, liability or expense arises out of or is based upon an untrue statement
or alleged untrue statement or omission or alleged omission in a Prospectus
subject to completion, if (A) such untrue statement or alleged untrue statement,
omission or alleged omission is corrected in an amendment or supplement to such
Prospectus; (B) Funding, TCHI or the Partnership had furnished such Indemnified
Party with the number of copies of such amended or supplemented Prospectus
requested by such Indemnified Party a reasonable period of time prior to such
sale; and (C) thereafter such Indemnified Party fails to deliver such Prospectus
as so amended or supplemented prior to or concurrently with the sale by such
Indemnified Party of the Registrable Series A Notes to the Person asserting such
loss, claim, damage, liability or expense; and provided, further, that this
indemnity agreement does not apply to any Indemnified Party with respect to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission contained
in any Registration Statement (or any amendment thereto) or Prospectus (or any
amendment or supplement thereto) made in reliance upon and in conformity with
written information furnished to Funding or the Partnership by such Indemnified
Party expressly for use in such Registration Statement (or such amendment
thereto) or such Prospectus (or such amendment or supplement thereto).
(b) Indemnification by Holders, Underwriters, Etc. (i) In connection with
any Registration Statement in which a Holder is participating, such Holder
severally agrees to indemnify and hold harmless Funding, TCHI the Partnership
and the other selling Holders, and each of their respective Affiliates
(including any director, officer, trustee, employee, agent, attorney or Person,
if any, who controls Funding, TCHI, the Partnership or any other selling Holder
within the meaning of Section 15 of the Securities Act), against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in Section 7(a)
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hereof; provided however, that any settlement of the type described in Section
7(a)(ii) is effected with the written consent of such Holder, as incurred, but
only with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in a Registration Statement (or any amendment
thereto) or any Prospectus (or any amendment or supplement thereto) in reliance
upon and in conformity with written information furnished to Funding, TCHI or
the Partnership by such selling Holder expressly for use in such Registration
Statement (or any amendment thereto) or such Prospectus (or any amendment or
supplement thereto); and provided further, however, that an indemnifying Holder
shall not be required to provide indemnification in any amount in excess of the
amount by which (A) the total price at which the Registrable Series A Notes sold
by such indemnifying Holder and its affiliated indemnifying Holders and
distributed to the public were offered to the public exceeds (B) the amount of
any damages which such indemnifying Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission.
(ii) Funding, TCHI and the Partnership shall be entitled to receive
indemnities from underwriters, selling brokers, dealer managers and similar
securities industry professionals participating in the distribution, to the same
extent as provided above with respect to information so furnished in writing by
such Persons specifically for inclusion in any Prospectus or Registration
Statement.
(c) Conduct of Indemnification Proceedings. Each indemnified party or
parties under this Section 7 shall give reasonably prompt notice to each
indemnifying party or parties of any action or proceeding commenced against it
or them in respect of which indemnity may be sought hereunder, but failure to so
notify an indemnifying party or parties shall not relieve it or them from any
liability which it or they may have under this indemnity agreement, except to
the extent that the indemnifying party or parties have been prejudiced
materially by such failure. If the indemnifying party or parties so elect,
within a reasonable time after receipt of such notice, the indemnifying party or
parties may assume the defense of such action or proceeding at such indemnifying
party's or parties' expense with counsel chosen by the indemnifying party or
parties and approved by the indemnified parties defendant in such action or
proceeding, which approval shall not be unreasonably withheld; provided,
however, that if such indemnified party or parties reasonably determine that a
conflict of interest exists where it is advisable for such indemnified party or
parties to be represented by separate counsel or that, upon advice of counsel,
there may be legal defenses available to them which are different from or in
addition to those available to the indemnifying party, then the indemnifying
party or parties shall not be entitled to assume such defense and the
indemnified party or parties shall be entitled to separate counsel at the
indemnifying party's or parties' expense. If an indemnifying party is not so
entitled to assume the defense of such action or does not assume such defense,
after having received the notice referred to in the first sentence of this
paragraph, the indemnifying party will pay the reasonable fees and expenses of
one lead counsel and one local counsel for the indemnified party or parties. In
such event, however, no indemnifying party or parties will be liable under this
Section 7 for any settlement effected without the written consent of such
indemnifying party or parties (which shall not be unreasonably withheld)
21
<PAGE>
unless a complete release of such indemnifying party or parties is obtained as
part of such settlement. If an indemnifying party is entitled to assume, and
promptly assumes, the defense of such action or proceeding in accordance with
this Section 7(c), such indemnifying party shall not be liable for any fees and
expenses of counsel for the indemnified parties incurred thereafter in
connection with such action or proceeding.
(d) Contribution. (i) If the indemnification provided for in this Section
7 is held to be unenforceable although applicable in accordance with its terms
in respect of any losses, claims, damages, liabilities or expenses suffered by
an indemnified party referred to therein, then each applicable indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses in such proportion as is appropriate to
reflect the relative fault of Funding, TCHI and the Partnership on the one hand
and of the selling Holders (including, in each case, that of their officers,
directors, employees and agents) on the other in connection with the statements
or omissions which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
fault of Funding, TCHI and/or the Partnership on the one hand and of the selling
Holders (including, in each case, that of their officers, directors, employees
and agents) on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by Funding, TCHI or the Partnership, on the one hand, or by or on
behalf of the selling Holders, on the other, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in Section 7(c), any
legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim.
(ii) Funding, TCHI, the Partnership and each Holder of Registrable
Series A Notes agree that it would not be just and equitable if contribution
pursuant to this Section 7(d) were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to in paragraph (i) above. Notwithstanding the
provisions of this Section 7(d), in the case of distributions to the public an
indemnifying Holder shall not be required to contribute any amount in excess of
the amount by which the total price at which the Registrable Series A Notes sold
by such indemnifying Holder or its affiliated indemnifying Holders and
distributed to the public were offered to the public exceeds the amount of any
damages which such indemnifying Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation.
22
<PAGE>
8. Rule 144 and Rule 144A.
(a) Each of Funding and the Partnership covenants that (A) for so long as
Funding is subject to the reporting requirements of Section 13 or 15 of the
Exchange Act it will file the reports required to be filed by it under the
Securities Act and Section 13(a) or 15(e) of the Exchange Act and the rules and
regulations adopted by the SEC thereunder and (B) that if it ceases to be so
required to file such reports, it will upon the request of any Holder (i) make
publicly available such information as is necessary to permit sales pursuant to
Rule 144 under the Securities Act, (ii) deliver such information to a
prospective purchaser as is necessary to permit sales pursuant to Rule 144A
under the Securities Act and it will take such further action as any Holder may
reasonably request, and (iii) take such further action that is reasonable in the
circumstances, in each case, to the extent required from time to time to enable
such Holder to sell its Registrable Series A Notes without registration under
the Securities Act within the limitation of the exemptions provided by (a) Rule
144 under the Securities Act, as such Rule may be amended from time to time, (b)
Rule 144A under the Securities Act, as such Rule may be amended from time to
time, or (c) any similar rules or regulations hereafter adopted by the SEC. Upon
the request of any Holder, Funding and the Partnership will deliver to such
Holder a written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 8(a) shall be deemed to
require Funding or the Partnership to register any Securities under the Exchange
Act.
(b) Each of TCHI and the Partnership covenants that (A) if and whenever
TCHI is subject to the reporting requirements of Section 13 or 15 of the
Exchange Act, that it will file the reports required to be filed by it under the
Securities Act and Section 13(a) or 15(e) of the Exchange Act and the rules and
regulations adopted by the SEC thereunder and (B) that whenever it is not
required to file such reports, it will upon the request of any Holder (i) make
publicly available such information as is necessary to permit sales pursuant to
Rule 144 under the Securities Act, (ii) deliver such information to a
prospective purchaser as is necessary to permit sales pursuant to Rule 144A
under the Securities Act and it will take such further action as any Holder may
reasonably request, and (iii) take such further action that is reasonable in the
circumstances, in each case, to the extent required from time to time to enable
such Holder to sell its Registrable Series A Notes without registration under
the Securities Act within the limitation of the exemptions provided by (a) Rule
144 under the Securities Act, as such Rule may be amended from time to time, (b)
Rule 144A under the Securities Act, as such Rule may be amended from time to
time, or (c) any similar rules or regulations hereafter adopted by the SEC. Upon
the request of any Holder, TCHI and the Partnership will deliver to such Holder
a written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 8(b) shall be deemed to
require TCHI or the Partnership to register any Securities under the Exchange
Act.
23
<PAGE>
9. Miscellaneous.
(a) No Inconsistent Agreements. Neither Funding, TCHI nor the Partnership
has entered into nor will Funding or the Partnership on or after the date of
this Agreement enter into any agreement which is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. Neither TCHI, Funding nor the Partnership has entered or will
enter into any other agreement with respect to its securities granting any
piggy-back registration rights with respect to a Registration Statement.
(b) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given unless TCHI, Funding and the Partnership obtained the written consent of
the Majority Holders; provided, however, that no amendment, modification or
supplement or waiver or consent to the departure with respect to the provisions
of Section 7 hereof shall be effective as against any Holder unless consented to
in writing by such Holder.
(c) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (i) if to a Holder, at the most current address given by such Holder to
TCHI, Funding or the Partnership by means of a notice given in accordance with
the provisions of this Section 9(c), which address initially is, with respect to
each Fund, the address set forth next to such Fund's name on the signature pages
of the Purchase Agreement, with a copy to Ropes & Gray, One International Place,
Boston, Massachusetts 02110, Attention: Robert L. Nutt, Esq., or (ii) if to
Funding or the Partnership, at Brigantine Boulevard and Huron Avenue, Atlantic
City, New Jersey 08401, Attention: Chief Financial Officer, or such other
address, notice of which is given in accordance with the provisions of this
Section 9(c), with a copy to the attention of Daniel D. Rubino, Esq., at, (A) if
prior to May 26, 1998, Willkie Farr & Gallagher, One Citicorp Center, 153 East
53rd Street, New York, New York 10022 or (B) if on or after May 26, 1998,
Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New York 10019-6099.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on
the next business day if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
24
<PAGE>
(d) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors, assigns and transferees of each of the
parties, including, without limitation and without the need for an express
assignment, subsequent Holders. If any successor, assignee or transferee of any
Holder shall acquire Registrable Series A Notes, in any manner, whether by
operation of law or otherwise, such Registrable Series A Notes shall be held
subject to all of the terms of this Agreement, and by taking and holding such
Registrable Series A Notes such Person shall be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this
Agreement and such Person shall be entitled to receive the benefits hereof.
(e) Counterparts. This Agreement may be executed in any number of
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original, but all of which counterparts, taken together, shall constitute
one and the same instrument.
(f) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF TCHI, FUNDING AND THE PARTNERSHIP HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH
OF MANHATTAN, CITY OF NEW YORK, OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF
MANHATTAN, CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PERSON TO SERVE
PROCESS IN ANY MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST TCHI, FUNDING AND THE PARTNERSHIP IN ANY OTHER
JURISDICTION.
(h) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held to be
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provisions in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(i) Specific Performance. The parties hereto acknowledge that there would
be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that each party, in addition to any
other remedy to which it may be entitled at law or in equity, shall be entitled
to compel specific performance of the obligations of any
25
<PAGE>
other party under this Agreement in accordance with the terms and conditions of
this Agreement in any court of the United States or any State thereof having
jurisdiction.
(j) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings other than those set forth or referred to herein,
with respect to the registration rights granted by Funding with respect to the
Securities sold pursuant to the Purchase Agreement. This Agreement supersedes
all prior agreements and understandings between the parties with respect to such
subject matter.
(k) Securities Held by Funding or Its Respective Affiliates. Whenever the
consent or approval of Holders of a specified percentage of Registrable Series A
Notes is required hereunder, Registrable Series A Notes held by TCHI, Funding,
the Partnership or their respective Affiliates (other than any Holders that are
deemed to be such Affiliates solely by reason of their holdings of such
Registrable Series A Notes) shall not be counted in determining whether such
consent or approval was given by the Holders of such required percentage.
26
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
The Partnership TRUMP'S CASTLE ASSOCIATES, L.P.
By TRUMP'S CASTLE HOTEL & CASINO, INC.,
its general partner
By: /s/ Nicholas L. Ribis
-------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
TCHI TRUMP'S CASTLE HOTEL & CASINO, INC.
By: /s/ Nicholas L. Ribis
-------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
Funding TRUMP'S CASTLE FUNDING, INC.
By: /s/ Nicholas L. Ribis
-------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
<PAGE>
The Funds THE FUNDS LISTED ON EXHIBIT A HERETO
By: /s/ John R. Verani
-------------------------
Name: John R. Verani
Title: Vice President
PUTNAM INVESTMENT MANAGEMENT, INC.
ON BEHALF OF THE FUNDS AND ACCOUNTS
LISTED ON EXHIBIT B HERETO
By: /s/ John R. Verani
-------------------------
Name: John R. Verani
Title: Senior Vice President
PUTNAM FIDUCIARY TRUST COMPANY ON
BEHALF OF THE FUNDS AND ACCOUNTS
LISTED ON EXHIBIT C HERETO
By: /s/ John R. Verani
----------------------
Name: John R. Verani
Title: Senior Vice President
THE PUTNAM ADVISORY COMPANY, INC. ON BEHALF
OF THE FUNDS AND ACCOUNTS LISTED ON EXHIBIT
D HERETO
By: /s/ John R. Verani
----------------------
Name: John R. Verani
Title: Senior Vice President
<PAGE>
EXHIBIT A
Putnam Variable Trust - PVT High Yield Fund
Putnam Funds Trust - Putnam High Yield Trust II
Putnam Managed High Yield Trust
Putnam High Yield Trust
Putnam High Yield Advantage Fund
Putnam Strategic Income Fund
Putnam Diversified Income Trust
Putnam Variable Trust -PVT Diversified Income Fund
Putnam Master Income Trust
Putnam Premier Income Trust
Putnam Master Intermediate Income Trust
Putnam Asset Allocation Funds - Balanced Portfolio
Putnam Variable Trust - PVT Global Asset Allocation Fund
Putnam Asset Allocation Funds - Conservative Portfolio
Putnam Asset Allocation Funds - Growth Portfolio
Putnam The George Putnam Fund of Boston
Putnam Income Fund
Putnam Equity Income Fund
Putnam Balanced Retirement Fund
Putnam Funds Trust - Putnam High Yield Total Return Fund
Putnam High Income Convertible and Bond Fund
Putnam Convertible Opportunities and Income Trust
EXHIBIT B
Travelers Series Fund Inc. - Putnam Diversified Income Portfolio
EXHIBIT C
Putnam High Yield Managed Trust
Putnam High Yield Fixed Income Fund, LLC
EXHIBIT D
Ameritech Corporation Pension Plan
Dana Farber Cancer Institute
Abbott Laboratories Annuity Retirement Plan
Mobil Oil Corporation Retirement Plans
Strategic Global Fund - High Yield Fixed Income (Putnam) Fund
Ameritech Corporation Pension Plan
29
INTERCREDITOR AGREEMENT
among
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Funding Note Indenture
U.S. BANK NATIONAL ASSOCIATION,
as the Trustee under the TCHI Note Indenture
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Mortgage Note Indenture
and
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the PIK Note Indenture
and consented to by
TRUMP'S CASTLE ASSOCIATES, L.P.
TRUMP'S CASTLE FUNDING, INC., and
TRUMP'S CASTLE HOTEL & CASINO, INC.
Dated as of April 17, 1998
Record and return to:
Robert Nutt, Esq.
Ropes & Gray
One International Place
Boston, MA 02110-2624
<PAGE>
INTERCREDITOR AGREEMENT
INTERCREDITOR AGREEMENT, dated as of April 17, 1998, by and among
U.S. BANK NATIONAL ASSOCIATION as Trustee (the "Funding Note Trustee") under a
certain Funding Note Indenture dated as of the date hereof (as the same may from
time to time be amended, supplemented or otherwise modified, the "Funding Note
Indenture") among TRUMP'S CASTLE FUNDING, INC., a New Jersey corporation, as
Issuer ("Funding"), TRUMP'S CASTLE ASSOCIATES, L.P., a New Jersey limited
partnership, as Guarantor (the "Partnership"), and the Funding Note Trustee;
U.S. BANK NATIONAL ASSOCIATION as Trustee (the "TCHI Note Trustee") under a
certain TCHI Note Indenture dated as of the date hereof (as the same may from
time to time be amended, supplemented or otherwise modified, the "TCHI Note
Indenture") among TRUMP'S CASTLE HOTEL & CASINO, INC., a New Jersey corporation,
as Issuer ("TCHI"), the Partnership, as Guarantor and the TCHI Note Trustee;
U.S. BANK NATIONAL ASSOCIATION, as Trustee (the "Mortgage Note Trustee") under a
certain Mortgage Note Indenture dated as of December 28, 1993 (as the same may
from time to time be amended, supplemented or otherwise modified, the "Mortgage
Note Indenture") among Funding, as Issuer, the Partnership, as Guarantor, and
the Mortgage Note Trustee; and U.S. BANK NATIONAL ASSOCIATION, as Trustee (the
"PIK Note Trustee") under a certain PIK Note Indenture dated as of as of
December 28, 1993 (as the same may from time to time be amended, supplemented or
otherwise modified, the "PIK Note Indenture") among Funding, as Issuer, the
Partnership as Guarantor, and the PIK Note Trustee; and consented to by Funding,
TCHI and the Partnership. The Funding Note Trustee and the TCHI Note Trustee are
sometimes referred to together in this Intercreditor Agreement as the "Senior
Notes Trustee" and the Mortgage Note Trustee and the PIK Note Trustee are
sometimes referred to together as the "Subordinated Notes Trustee." U.S. Bank
National Association was previously known as First Bank National Association.
The Partnership was previously known as Trump's Castle Associates, a New Jersey
general partnership. For convenience of reference, First Bank National
Association and Trump's Castle Associates are referred to herein by the names of
their respective successor entities.
WITNESSETH:
WHEREAS, pursuant to an indenture dated as of December 28, 1993
among Funding, as Issuer, the Partnership, as Guarantor, and U.S. Bank National
Association (the "Old Senior Note's Trustee"), as Trustee, Funding issued its
11 1/2% Senior Secured Notes due 2000 ("Old Senior Notes");
WHEREAS, pursuant to the Mortgage Note Indenture, Funding issued its
11 3/4% Mortgage Notes due 2003 (the "Mortgage Notes");
WHEREAS, pursuant to the PIK Note Indenture, Funding issued its
Subordinated Pay-In-Kind Notes due 2005 (the "PIK Notes");
<PAGE>
WHEREAS, prior to the date of this Intercreditor Agreement, Funding
and the Partnership were also indebted to Midlantic National Bank ("Midlantic"),
now PNC Bank, N.A. (together with all other obligations and liabilities of
Funding and/or the Partnership to Midlantic, its successors and assigns, the
"Midlantic Obligations"), pursuant to, inter alia, an amended and restated
credit agreement by and among Midlantic, the Partnership and Funding dated as of
December 28, 1993 (as the same may have been amended from time to time);
WHEREAS, pursuant to the Funding Note Indenture, Funding has issued
the $62,000,000 aggregate original principal amount 10 1/4% Series A Senior
Secured Notes due 2003 (together with other debt securities issued in exchange
for or substitution of such notes, the "Funding Notes");
WHEREAS, pursuant to the TCHI Note Indenture, TCHI has issued the
$5,000,000 aggregate principal amount 10 1/4% Series A Senior Secured Notes due
2003 (together with other debt securities issued in exchange for or substitution
of such notes, the "TCHI Notes") (the TCHI Notes and the Funding Notes, together
the "Senior Notes");
WHEREAS, proceeds of the Senior Notes are being used to refinance
and replace the Old Senior Notes and the Midlantic Obligations and to supply
working capital to the Partnership;
WHEREAS, the liens and security interests previously granted to
secure the Midlantic Obligations had been senior to the liens and security
interests granted to secure the then existing Indenture Obligations (as
hereafter defined);
WHEREAS, the liens and security interests previously granted to the
Old Senior Notes Trustee had been senior to the liens and security interests
granted to the Mortgage Notes Trustee;
WHEREAS, purchasers of the Senior Notes have conditioned their
acquisition of the Senior Notes on the Senior Notes having a first priority lien
and security interest in and upon the Trust Estate (as hereafter defined) that
is senior, and not pari passu with or subordinate, to the liens and security
interests in and upon the Trust Estate granted to the Mortgage Note Trustee, but
as between them, the lien and security interest of the Funding Notes and the
TCHI Notes shall be pari passu;
WHEREAS, the PIK Notes were and are to remain unsecured; and
WHEREAS, the Trustees in their various capacities desire to set
forth their relative rights and obligations with respect to the Funding Notes
Indenture, TCHI Notes Indenture, Mortgage Notes Indenture and PIK Notes
Indenture and related matters.
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
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<PAGE>
SECTION 1. Definitions.
1.1. As used in this Intercreditor Agreement and unless otherwise
expressly indicated, all capitalized words and terms not defined herein shall
have the respective meanings and be construed herein as such words or terms are
defined or construed in the Funding Note Indenture.
1.2. For the purposes of this Intercreditor Agreement, the following
terms shall have the following meanings:
"Indenture Documents" means all instruments, documents and
agreements, executed or delivered pursuant to or in connection with the
Indentures, the Indenture Notes, the Indenture Mortgages and/or the Indenture
Guarantees, as the same may from time to time be amended, supplemented or
otherwise modified.
"Indenture Guarantees" means all guaranties now existing or
hereafter arising executed by the Partnership in favor of any Trustee, as the
same may from time to time be amended, supplemented or otherwise modified.
"Indenture Mortgages" means any and all mortgages and other security
instruments now existing or hereafter arising granted by the Partnership, TCHI
and/or Funding which secures, in whole or in part, directly or indirectly,
through assignment or otherwise, the Indenture Obligations, including, without
limitation, any mortgage granted by the Partnership (i) to Funding or TCHI and
assigned to a Trustee and (ii) to a Trustee to secure any Indenture Guarantee.
"Indenture Notes" means the Funding Notes, the TCHI Notes, the
Mortgage Notes and the PIK Notes, as the same may from time to time be amended,
supplemented or otherwise modified.
"Indenture Obligations" means all indebtedness, obligations and
other liabilities of the Partnership, TCHI and/or Funding to any one or more
Trustees and any and all other Persons pursuant to or arising from the
Indentures, the Indenture Notes, the Indenture Mortgages, the Indenture
Guarantees and the other Indenture Documents (including, without limitation,
indebtedness of the Partnership to Funding or TCHI and assigned to any one or
more Trustees), whether direct or indirect, absolute or contingent, secured or
unsecured, due or to become due, now existing or hereafter arising, including,
without limitation, all interest, fees, charges, costs and expenses (including,
without limitation, reasonable attorneys' fees and disbursements), for which the
Partnership, TCHI, Funding or any other Person is now or hereafter becomes
liable to pay to the Trustee(s) or any other Persons pursuant to any of such
Indenture Documents.
"Indentures" means the Funding Note Indenture, the TCHI Note
Indenture, the Mortgage Note Indenture and the PIK Note Indenture.
-3-
<PAGE>
"Senior Notes Indenture Documents" means all instruments, documents
and agreements, executed or delivered pursuant to or in connection with the
Senior Notes Indentures, the Senior Notes, the Senior Notes Indenture Mortgages
and/or the Senior Notes Indenture Guarantees, as the same may from time to time
be amended, supplemented or otherwise modified.
"Senior Notes Indenture Guarantees" means all guaranties now
existing or hereafter arising executed by the Partnership in favor of any
Trustee, as the same may from time to time be amended, supplemented or otherwise
modified.
"Senior Notes Indenture Mortgages" means any and all mortgages and
other security instruments now existing or hereafter arising granted by the
Partnership, TCHI and/or Funding which secure, in whole or in part, directly or
indirectly, through assignment or otherwise, the Senior Notes Indenture
Obligations, including, without limitation, any mortgage granted by the
Partnership (i) to Funding or TCHI and assigned to a Trustee and (ii) to a
Trustee to secure any Senior Notes Indenture Guarantee.
"Senior Notes" means the Funding Notes and the TCHI Notes, as the
same may from time to time be amended, supplemented or otherwise modified.
"Senior Notes Indenture Obligations" means all indebtedness,
obligations and other liabilities of the Partnership, TCHI and/or Funding to any
one or more Trustees and any and all other Persons pursuant to or arising from
the Senior Notes Indentures, the Senior Notes, the Senior Notes Indenture
Mortgages, the Senior Notes Indenture Guarantees and the other Senior Notes
Indenture Documents (including, without limitation, indebtedness of the
Partnership to Funding or TCHI and assigned to any one or more Trustees),
whether direct or indirect, absolute or contingent, secured or unsecured, due or
to become due, now existing or hereafter arising, including, without limitation,
all interest, fees, charges, costs and expenses (including, without limitation,
reasonable attorneys' fees and disbursements), for which the Partnership, TCHI,
Funding or any other Person is now or hereafter becomes liable to pay to the
Trustee(s) or any other Persons pursuant to any of such Senior Notes Indenture
Documents.
"Senior Notes Indentures" means the Funding Note Indenture and the
TCHI Note Indenture.
"Subordinated Notes Indenture Documents" means all instruments,
documents and agreements, executed or delivered pursuant to or in connection
with the Subordinated Notes Indentures, the Subordinated Notes, the Subordinated
Notes Indenture Mortgages and/or the Subordinated Notes Indenture Guarantees, as
the same may from time to time be amended, supplemented or otherwise modified.
"Subordinated Notes Indenture Guarantees" means all guaranties now
existing or hereafter arising executed by the Partnership in favor of any
Trustee, as the same may from time to time be amended, supplemented or otherwise
modified.
-4-
<PAGE>
"Subordinated Notes Indenture Mortgages" means any and all mortgages
and other security instruments now existing or hereafter arising granted by the
Partnership, TCHI and/or Funding which secure, in whole or in part, directly or
indirectly, through assignment or otherwise, the Subordinated Notes Indenture
Obligations, including, without limitation, any mortgage granted by the
Partnership (i) to Funding or TCHI and assigned to a Trustee and (ii) to a
Trustee to secure any Subordinated Notes Indenture Guarantee.
"Subordinated Notes" means the Mortgage Notes and the PIK Notes, as
the same may from time to time be amended, supplemented or otherwise modified.
"Subordinated Notes Indenture Obligations" means all indebtedness,
obligations and other liabilities of the Partnership, TCHI and/or Funding to any
one or more Trustees and any and all other Persons pursuant to or arising from
the Subordinated Notes Indentures, the Subordinated Notes, the Subordinated
Notes Indenture Mortgages, the Subordinated Notes Indenture Guarantees and the
other Subordinated Notes Indenture Documents (including, without limitation,
indebtedness of the Partnership to Funding or TCHI and assigned to any one or
more Trustees), whether direct or indirect, absolute or contingent, secured or
unsecured, due or to become due, now existing or hereafter arising, including,
without limitation, all interest, fees, charges, costs and expenses (including,
without limitation, reasonable attorneys' fees and disbursements), for which the
Partnership, TCHI, Funding or any other Person is now or hereafter becomes
liable to pay to the Trustee(s) or any other Persons pursuant to any of such
Subordinated Notes Indenture Documents.
"Subordinated Notes Indentures" means the Mortgage Note Indenture
and the PIK Note Indenture.
"Trust Estate" has the meaning set forth in the habendum to the
Granting Clauses of the Indenture Mortgages.
"Trustee" or "Trustees" shall mean each of the Funding Note Trustee,
the TCHI Note Trustee, the Mortgage Note Trustee and the PIK Note Trustee and
each of their permitted successors and assigns, unless the context requires
reference to one or more but less than all of such Trustees.
1.3. The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Intercreditor Agreement shall refer to this
Intercreditor Agreement as a whole and not to any particular provision of this
Intercreditor Agreement, and section, subsection, schedule and exhibit
references are to this Intercreditor Agreement unless otherwise specified. The
terms defined in this Section and elsewhere include the plural as well as the
singular.
SECTION 2. Lien Priority and Subordination.
2.1. Lien Priority. Each Trustee hereby agrees that any and all
security interests, mortgages, assignments of leases, assignments of operating
assets, other assignments,
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<PAGE>
pledges and other liens, charges or encumbrances (including, without limitation,
the Subordinated Indenture Mortgages and the other recorded or filed liens in
favor of the Subordinated Notes Trustee identified on Schedule A to this
Intercreditor Agreement) now existing or hereafter created or arising in its
favor in respect of any of the Subordinated Notes Indenture Obligations are
expressly subordinate, inferior and junior in priority, operation and effect to
any and all security interests, mortgages, assignments of leases, assignments of
operating assets, other assignments, pledges and other liens, charges or
encumbrances (including, without limitation, the Senior Notes Indenture
Mortgages) now existing or hereafter created or arising in favor of any of the
Senior Notes Trustees in respect of the Senior Notes Indenture Obligations,
notwithstanding anything to the contrary contained in any agreement or filing to
which the Partnership, Funding, TCHI or any Trustee may now or hereafter be a
party, and irrespective of the time, order or method of attachment or perfection
of any security interests granted thereby or the time or order of execution,
filing or recording of any mortgages, financing statements or other security
interests, assignments, pledges and other liens, charges or encumbrances. Each
Senior Notes Trustee hereby agrees that any and all security interests,
mortgages, assignments of leases, assignments of operating assets, other
assignments, pledges and other liens, charges or encumbrances, including,
without limitation, the Senior Indenture Mortgages and the other recorded or
filed liens in favor of each Senior Notes Trustee now existing or hereafter
created or arising in its favor in respect of the Senior Notes Indenture
Obligations shall rank pari passu in lien, notwithstanding anything to the
contrary contained in any agreement or filing to which the Partnership, Funding,
TCHI or any Trustee may now or hereafter be a party, and irrespective of the
time, order or method of attachment or perfection of any security interests
granted thereby or the time or order of execution, filing or recording of any
mortgages, financing statements or other security interests, assignments,
pledges and other liens, charges or encumbrances. Any assets (including, without
limitation, any real property(ies)) of Funding, TCHI or the Partnership now or
from time to time hereafter given, granted, assigned, mortgaged, pledged or
otherwise encumbered to secure the Indenture Obligations (collectively, together
with any and all proceeds or products thereof, the "Shared Collateral") shall be
subject to the priority established by the Section 2.1, provided that (i) the
Senior Partnership Note, the Senior Partnership Upstream Note, the Partnership
Note and the Subordinated Partnership Note (as such terms are defined in the
Funding Note Indenture, the TCHI Note Indenture, the, Mortgage Note Indenture
and the PIK Note Indenture, respectively) shall not constitute Shared Collateral
and (ii) nothing in this Intercreditor Agreement is intended to provide rights
in the Shared Collateral as security for any Indenture Obligations not otherwise
vested, granted or authorized in or pursuant to the Indenture applicable to such
Indenture Obligations.
2.2. Proceeds of Shared Collateral. In the event that any one or
more Trustees exercises its respective rights with respect to the Shared
Collateral pursuant to the Indenture Documents, each Trustee shall apply the
proceeds from any sale or sales or other disposition(s), (i) first, to the
reasonable compensation of agents and reasonable fees and expenses of counsel,
(ii) second, any surplus then remaining to the payment in full of the Senior
Notes Indenture Obligations in accordance with the Senior Notes Indenture
Documents, (iii) third, any surplus then remaining to the payment of the
Subordinated Notes Indenture Obligations in accordance with the Indenture
Documents, and (iv) fourth, subject to the rights of the holder of any then
existing Lien of which any Trustee has actual notice, any surplus then remaining
to the
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<PAGE>
Partnership or as a court of competent jurisdiction may otherwise direct.
Subject to the rights of the Partnership to apply insurance proceeds or eminent
domain awards to effect Restorations of the Premises, as those terms are defined
in and set forth in the Mortgages, such proceeds and awards are acknowledged to
be Shared Collateral and subject to this Section 2.2.
2.3. Payment. If at any time an Event of Default described in
Section 5.1(a), (b) or (c) of the Senior Notes Indenture (each, a "Payment Event
of Default") occurs and is continuing, or a Senior Notes Trustee has declared
the principal balance of either of the Senior Notes to be due and payable in
full pursuant to Section 5.2 of a Senior Notes Indenture, and shall have given
written notice thereof to the Subordinated Notes Trustee, then no Subordinated
Notes Trustee shall make to the holders of the Subordinated Notes any payments
or interest on or the principal of any of the Subordinated Notes, or to effect
any Redemption of any of the Subordinated Notes or to make open market purchases
of any of the Subordinated Notes (any such payments of interest and/or principal
and any payments to effect any Redemption or make open market purchases being
hereinafter referred to as a "Blocked Payment"). If, notwithstanding the
foregoing, any payment constituting a Blocked Payment is received by any
Subordinated Notes Trustee after the occurrence and during the continuance of a
Payment Event of Default, such payment or distribution received by any such
Trustee shall be held in trust by such Trustee for the benefit of the Senior
Notes Trustee until such time as (i) such Subordinated Notes Trustee receives
written notice from each Senior Notes Trustee that the Payment Event of Default
has been remedied or cured, in which event such Subordinated Notes Trustee shall
be entitled hereunder to distribute the amount of such Blocked Payment to the
holders of the Subordinated Notes in accordance with the applicable Indenture,
(ii) such Subordinated Notes Trustee receives written notices from a Senior
Notes Trustee of the occurrence of an Event of Default described in Section
5.1(h) or (i) of a Senior Notes Indenture (each a "Bankruptcy Event of
Default"), in which event such payment shall be paid to a Senior Notes Trustee
or as a court of competent jurisdiction may direct in a final and non-appealable
order, and to the extent paid to or for the benefit of a Senior Notes Trustee
shall be deemed for purposes of this Intercreditor Agreement to be proceeds of
Shared Collateral, or (iii) such Trustee receives written notice from a Senior
Notes Trustee that a Senior Notes Trustee has accelerated the stated maturity of
the Senior Notes Indenture Obligations and/or is exercising any other rights or
remedies with respect to any Payment Event of Default, in which event such
payment shall be paid over to a Senior Notes Trustee and shall be deemed for
purposes of this Intercreditor Agreement to be proceeds of Shared Collateral.
For the purposes of this Section 2.3, each Subordinated Notes Trustee shall
conclusively presume that a Payment Event of Default has occurred simultaneously
(i) with the occurrence of a default described in Section 5.1(a), (b) or (c) of
a Subordinated Notes Indenture, whether or not a Senior Notes Trustee has given
notice of same to Funding, TCHI, the Partnership or to any Trustee; and (ii)
upon a default under Section 5.1(a) of a Senior Notes Indenture, so long as a
Senior Notes Trustee has given notice of the same to the Subordinated Notes
Trustees, whether or not the thirty (30) day period has passed. The Funding
Notes and the TCHI Notes and all Senior Notes Obligations arising under or
pursuant to the Funding Notes Indenture and the TCHI Notes Indenture shall rank
pari passu in right of payment.
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<PAGE>
2.4. Exercise of Remedies. Nothing in this Intercreditor Agreement
shall prevent at any time any Trustee from exercising or refraining in its sole
discretion from the exercise of any rights or remedies available to it under
this Intercreditor Agreement or any Indenture Documents, provided that (i) all
remedies exercised by any Trustee in respect of any Shared Collateral shall be
exercised in accordance with paragraphs 2.1, 2.2 and 2.3 of this Section 2.
SECTION 3. Intentionally omitted.
SECTION 4. Representations and Warranties. Each Trustee hereby represents and
warrants to each other of the Trustees that:
(a) Corporate Existence. The Trustee is a national banking
association duly organized, validly existing and in good standing under the laws
of the United States.
(b) Power and Authority. The Trustee has full power, authority and
legal right to execute, deliver and perform this Intercreditor Agreement. The
execution and delivery of this Intercreditor Agreement by the Trustee and the
performance or observance of each of the obligations of the Trustee hereunder
have been duly authorized by all necessary action on the part of the Trustee.
(c) Enforceable Obligations. This Intercreditor Agreement has been
duly executed and delivered by the Trustee and constitutes a legal, valid and
binding obligation of the Trustee, enforceable against it in accordance with its
terms.
(d) Consents, Approvals, Authorizations, etc. No consent, approval,
order or authorization of or registration, declaration or filing with any
Governmental Authority or any other Person is required in connection with the
valid execution and delivery by the Trustee of this Intercreditor Agreement or
the carrying out or performance by the Trustee of any of the transactions
required or contemplated hereby.
(e) No Legal Bar. The execution and delivery of this Intercreditor
Agreement by the Trustee, and the performance by the Trustee of its obligations
hereunder, will not violate any Legal Requirements affecting the Trustee.
(f) No Transfer or Subordination. The Trustee has not (i) sold,
assigned or otherwise transferred, in whole or in part, any of the Indenture
Obligations, any interest therein or any collateral security or guaranty
therefor to any other Person or (ii) made, given or permitted any currently
effective subordination or postponement in respect of the Indenture Obligations
or any Shared Collateral, except as provided herein.
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<PAGE>
SECTION 5. Negative Covenants of the Trustees.
5.1. Until each Senior Notes Indenture Obligations are indefeasibly
paid in full, each Trustee agrees not to, directly or indirectly:
(a) take, demand or receive from the Partnership, TCHI or Funding,
by setoff, Redemption, purchase or in any other manner, any payment in respect
of the Indenture Obligations, contrary to or in violation of the terms of this
Intercreditor Agreement;
(b) enter into any amendment or modification of, or supplement to,
any Indenture or any other Indenture Document which would contravene the
provisions of Section 10.21 of the Senior Notes Indentures;
(c) accept any payment or distribution made by or on behalf of the
Partnership, TCHI or Funding that the Partnership, TCHI or Funding is prohibited
from making under any of the Indenture Documents; or
(d) accelerate the indebtedness under its Indenture without giving
each Senior Notes Trustee at least two prior business days notice of such
acceleration.
SECTION 6. Waivers, etc.
6.1. Each of the Trustees hereto consents to and agrees with the
other Trustees that, without the necessity of any reservation of rights against
any other party and without notice to or further assent by any other party,
subject to the provisions of Section 2.1, 2.2 and 5.1 hereof, (a) any demand for
payment of any Indenture Obligation may be rescinded in whole or in part, and
any Indenture Obligation may be continued, and the Indenture Obligations, or the
liability of Funding, TCHI, the Partnership or any other Person upon or for any
part thereof, or any collateral security or guaranty therefor or right of offset
with respect thereto, or any obligation or liability of Funding, TCHI the
Partnership or any other Person thereunder or with respect thereto may, from
time to time, in whole or in part, be renewed, extended, modified, accelerated,
compromised, waived, surrendered or released (it being acknowledged that the
foregoing is subject, in the case of any Shared Collateral, to the provisions of
Section 2 hereof), and (b) the Indenture Documents, and any other documents,
instruments or agreements evidencing or governing the terms of the Indenture
Obligations or any collateral security documents or guaranties or documents in
connection therewith, may be amended, modified, supplemented or terminated, in
whole or in part, as the parties thereto may deem advisable from time to time,
except as otherwise expressly set forth therein, and any collateral security at
any time held by any Trustee from the payment of any of any Indenture
Obligations, respectively, may be sold, exchanged, waived, surrendered or
released, in each case all without notice to or further assent by any other
party hereto, each of which will remain bound under this Intercreditor
Agreement, and all without impairing, releasing or affecting the lien priority
or other provisions herein, notwithstanding any such renewal, extension,
modification, acceleration, compromise, amendment, supplement, termination,
sale, exchange, waiver, surrender or release,
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<PAGE>
subject in each case to the provisions of this Intercreditor Agreement. The
Trustees hereby waive any and all notice of the creation, renewal, extension or
accrual of any of the Indenture Obligations and notice of or proof of reliance
by the Trustees upon this Intercreditor Agreement and the Senior Notes Indenture
Obligations shall conclusively be deemed to have been created, contracted or
incurred in reliance upon this Intercreditor Agreement.
6.2. Each Trustee hereby acknowledges and confirms to each other
Trustee that:
(a) No Trustee has made any representations or warranties as to any
matter which may affect or in any way related to the financial condition,
relationships or transactions of Funding, TCHI, the Partnership or any other
Person, including, without limitation, the business, assets, liabilities, type
or value of any security therefor, financial condition, management or control of
Funding, TCHI, the Partnership or any other Person; and
(b) Except as expressly provided herein, no Trustee is obligated to
notify any other Trustee or any other Person of any change in the business,
assets, liabilities, type or value of any security therefor, financial
condition, management or control of Funding, TCHI, the Partnership or of any
other Person; and
(c) The failure by a Trustee to obtain, perfect or realize upon any
security for any of the Indenture Obligations or the indebtedness, obligations
or liabilities of any other Person, shall not release or otherwise impair any of
the obligations of the other Trustees hereunder.
SECTION 7. Term and Termination.
This Intercreditor Agreement shall constitute from and after the
date hereof a continuing agreement and shall remain in effect until the
Indenture Obligations are indefeasibly paid and performed in full without
contravention of Section 2.2 or Section 5.1 hereof and the Indenture Mortgages
and any other document evidencing any mortgage, security interest or any other
lien or encumbrance in favor of any Trustee which are a matter of public record.
This Intercreditor Agreement, including without limitation, the lien priority
and other provisions hereof shall remain in effect, notwithstanding any
proceeding instituted by or against the Partnership, TCHI and/or Funding seeking
to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief or composition of
the Partnership, TCHI and/or Funding or its respective debts under any law
related to bankruptcy, insolvency or reorganization or relief or protection of
debts, or seeking the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for the Partnership, TCHI
and/or Funding or any substantial part of its property or assets.
SECTION 8. Remedies and Cooperation.
Each party hereby acknowledges that the other parties shall have no
adequate remedy at law if a party violates any of the terms of provisions
hereof. In such event, each other
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<PAGE>
party shall have the right, in addition to any and all other rights and remedies
as may be available under applicable law, to obtain in any court of competent
jurisdiction injunctive relief to restrain any such party from any breach or
threatened breach of this Intercreditor Agreement or otherwise to specifically
enforce any of the terms or provisions hereof.
SECTION 9. Concerning the Trustees.
9.1. Each Trustee (which, for the purposes of this Intercreditor
Agreement includes each separate trustee appointed with such authority pursuant
to each Indenture) undertakes to perform such duties and only such duties are
specifically set forth in this Intercreditor Agreement as assigned to such
Trustee. No implied covenants or obligations shall be read into this
Intercreditor Agreement against any Trustee.
9.2. In the absence of bad faith on its part, each may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to such Trustee and
conforming to the requirements of this Intercreditor Agreement; but in the case
of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to any Trustee, such Trustee shall be
under a duty to examine the same to determine whether or not they conform to the
requirements of this Intercreditor Agreement.
9.3. Each Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
coupon or other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties.
9.4. Whenever in the administration of this Intercreditor Agreement
any Trustee shall deem it desirable that a matter be proved or established prior
to taking, suffering or omitting any action hereunder, such Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate.
9.5. Each Trustee may consult with counsel, and the written advice
of such counsel or any opinion of counsel shall be full and complete,
authorization and protection in respect of any action taken, suffered or omitted
by such Trustee hereunder in good faith and in reliance thereon.
9.6. No Trustee shall be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or document.
9.7. No provision of this Intercreditor Agreement shall be construed
to relieve any Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that no Trustee
shall be liable for any error of judgment made in good
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<PAGE>
faith by a responsible officer, unless it shall be proved that such Trustee was
negligent in ascertaining the pertinent facts.
9.8. No provision of this Intercreditor Agreement shall require any
Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that, under the terms of the applicable Indenture or otherwise,
repayment of such funds or adequate indemnity against such risk or liability is
not reasonable assured to it.
9.9. Each Trustee may execute any of its rights or powers hereunder
or perform any of its duties hereunder either directly or by or through agents
or attorneys, and such Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
SECTION 10. Miscellaneous.
10.1. No failure to exercise, and no delay in exercising, on the
part of any party hereto from time to time of any right, power or privilege
under this Intercreditor Agreement or any documents securing and/or evidencing
the Indenture Obligations shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege under this
Intercreditor Agreement or any other such document preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies provided in this Intercreditor Agreement and in any
agreement relating to any of the Indenture Obligations and all other agreements,
instruments and documents referred to in any of the foregoing are cumulative and
shall not be exclusive of any rights or remedies provided by law.
10.2. Each party hereto agrees to execute and deliver such further
documents and to do such other acts and things as any other party may reasonably
request in order fully to effect the purposes of this Intercreditor Agreement.
10.3. Any request, demand, authorization, direction, notice
(including, without limitation, a notice of default), consent, waiver or other
document provided or permitted by this Intercreditor Agreement to be made upon,
given or furnished to, or filed with any Trustee, Funding, TCHI or the
Partnership shall be deemed given when either (i) delivered by hand or by
Federal Express or other similar overnight courier or (ii) three Business Days
after sending by registered or certified mail, postage prepaid; in either case
addressed as follows:
To the Trustees (one such notice shall constitute sufficient notice
to the each of the Trustees hereunder, unless the same Person is not the Trustee
under each Indenture)):
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55010
Attention: Corporate Trust Administration
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<PAGE>
To the Partnership and TCHI:
Trump's Castle Associates, L.P.
Trump Marina Hotel Casino
Brigantine Boulevard at Huron Avenue
Atlantic City, New Jersey 08401
Attention: Chief Executive Officer
To Funding:
Trump's Castle Funding, Inc.
Trump Marina Hotel Casino
Brigantine Boulevard at Huron Avenue
Atlantic City, New Jersey 08401
Attention: Treasurer
with, in each case, a copy sent by the same method
to:
Trump Hotels & Casino Resorts Holdings, L.P.
725 Fifth Avenue
New York, New York 10022
Attention: Nicholas L. Ribis
Willkie Farr & Gallagher (prior to May 26, 1998)
One Citicorp Center
153 East 53rd Street
New York, New York 10022
Attention: Daniel D. Rubino, Esq.
Willkie Farr & Gallagher (after May 26, 1998)
787 Seventh Avenue
New York, New York 10019-6099
Attention: Daniel D. Rubino, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110-2624
Attention: Robert L. Nutt, Esq.
By notice given as provided above, each Trustee, Funding, TCHI or
the Partnership may designate additional or substitute addresses for such
notices, which, notwithstanding the provisions of clause (ii) of this Section
9.3, shall be deemed given when received.
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<PAGE>
If any Trustee commences foreclosure or other proceedings for sale
of any Shared Collateral then the foreclosing party agrees to give the other
copies of notices at the same time and by substantially the same method the
foreclosing party provides any such notice to the Partnership, TCHI or Funding.
10.4. No amendment or waiver of any provision of this Intercreditor
Agreement nor consent to any departure by any party herefrom, shall in any event
be effective unless the same shall be in writing and signed by such party, and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given.
10.5. This Intercreditor Agreement may be executed by the parties
hereto in any number of separate counterparts all of which taken together shall
constitute one and the same instrument.
10.6. This Intercreditor Agreement, and the rights and obligations
of the parties hereunder, shall be governed by, and construed and interpreted in
accordance with, the laws of the State of New Jersey (without giving effect to
principles of choice of law). Each Trustee hereby submits itself for the sole
purpose of this Intercreditor Agreement and any controversy arising hereunder to
the nonexclusive jurisdiction of the federal and state courts located in the
State of New Jersey, and waives any objection (on the grounds of lack of
jurisdiction or forum non conveniences, or otherwise) to jurisdiction over it by
any federal or state court in the State of New Jersey.
10.7. This Intercreditor Agreement is solely for the benefit of the
parties hereto and their respective successors and assigns, and no other Person
shall have any right, benefit, priority or interest under, or because of the
existence of, this Intercreditor Agreement.
10.8. The agreements of the Trustees hereunder are made solely in
its capacity as Trustee under each of the Indentures, and shall bind, and inure
to the benefit of, the holders of the Notes.
10.9. Any successor Trustee under any Indenture shall be deemed to
be and shall be bound by this Intercreditor Agreement.
10.10. This Intercreditor Agreement may be executed in counterparts,
each of which together shall constitute one and the same document.
10.11. The Recitals constitute an integral part of this
Intercreditor Agreement.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Intercreditor Agreement to be duty executed and delivered by their proper and
duly authorized officers as of the day and year first above written.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Funding Note Indenture
Witness: /s/ Beth E. Anisman By: /s/ Richard H. Prokosch
----------------------- ----------------------------------------
Name: Beth E. Anisman Richard H. Prokosch
Assistant Vice President
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the TCHI Note Indenture
Witness: /s/ Beth E. Anisman By: /s/ Richard H. Prokosch
----------------------- ----------------------------------------
Name: Beth E. Anisman Richard H. Prokosch
Assistant Vice President
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Mortgage Note
Indenture
Witness: /s/ Beth E. Anisman By: /s/ Richard H. Prokosch
----------------------- ----------------------------------------
Name: Beth E. Anisman Richard H. Prokosch
Assistant Vice President
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the PIK Note Indenture
Witness: /s/ Beth E. Anisman By: /s/ Richard H. Prokosch
----------------------- ----------------------------------------
Name: Beth E. Anisman Richard H. Prokosch
Assistant Vice President
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<PAGE>
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me
the subscriber, a Notary Public of the State of New York, personally appeared
Richard Prokosch, an assistant vice president of U.S. BANK NATIONAL ASSOCIATION,
a national banking association, the Trustee under a certain Funding Note
Indenture, who, I am satisfied, is the person who executed the within
instrument, and he acknowledged that he signed and delivered the same as such
officer on behalf of such association and that the within instrument is the
voluntary act and deed of said association made by virtue of authority of its
board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
[Seal]
<PAGE>
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
Richard Prokosch, an assistant vice president of U.S. BANK NATIONAL ASSOCIATION,
a national banking association, the Trustee under a certain TCHI Note Indenture,
who, I am satisfied, is the person who executed the within instrument, and he
acknowledged that he signed and delivered the same as such officer on behalf of
such association and that the within instrument is the voluntary act and deed of
said association made by virtue of authority of its board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
[Seal]
<PAGE>
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
Richard Prokosch, an assistant vice president of U.S. BANK NATIONAL ASSOCIATION,
a national banking association, the Trustee under a certain Mortgage Note
Indenture, who, I am satisfied, is the person who executed the within
instrument, and he acknowledged that he signed and delivered the same as such
officer on behalf of such association and that the within instrument is the
voluntary act and deed of said association made by virtue of authority of its
board of directors.
/s/ Reese M. Heitner
Notary Public of the State of New York
[Seal]
<PAGE>
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me
the subscriber, a Notary Public of the State of New York, personally appeared
Richard Prokosch, an assistant vice president of U.S. BANK NATIONAL ASSOCIATION,
a national banking association, the Trustee under a certain PIK Note Indenture,
who, I am satisfied, is the person who executed the within instrument and he
acknowledged that he signed and delivered the same as such officer on behalf of
such association and that the within instrument is the voluntary act and deed of
said association made by virtue of authority of its board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
[Seal]
<PAGE>
CONSENT AND AGREEMENT
The undersigned hereby acknowledge notice of, and consent to the terms and
provisions of, the foregoing Intercreditor Agreement. The undersigned waive
notice of acceptance of this Intercreditor Agreement by any Trustee and hereby
agree that:
(a) no further act or deed shall be required of the undersigned in order
to accomplish the purposes and carry out the intent of the Intercreditor
Agreement, and the undersigned agree not to take any action contrary to or
inconsistent with any of the terms of provisions thereof;
(b) from time to time, at their own expense, the undersigned will promptly
execute and deliver all further instruments and documents, and take all further
action that may be reasonably necessary in order to accomplish the purposes and
carry out the intent of the Intercreditor Agreement and;
(c) upon the occurrence and continuation of a Payment Event of Default,
the undersigned shall not make any payment to any Subordinated Notes Trustee
which would constitute a Blocked Payment, but instead shall pay directly to a
Senior Notes Trustee, for application on account of the Senior Notes Indenture
Obligations until the same are indefeasibly paid in full, any such payment
which, but for the provisions of the Intercreditor Agreement the undersigned
would have made to any Subordinated Notes Trustee.
The undersigned further agree that from and after the indefeasible payment
in full of the Senior Notes Indenture Obligations, and so long as the Senior
Notes Trustee shall not incur any liability arising out of the provisions of
this paragraph, the holders of the Subordinated Notes Indenture Obligations
shall, to the extent of any Blocked Payment which was paid to a Senior Notes
Trustee in accordance with the Intercreditor Agreement, be subrogated to the
then or thereafter rights of the holders of the Senior Notes Indenture
Obligations to receive payments or distributions of assets of the Partnership,
TCHI and/or Funding made on the Senior Notes Indenture Obligations until all
liabilities in respect of the Subordinated Notes Indenture Obligations shall be
paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of the Senior Notes Indenture Obligations of any
cash, property or securities to which the holders of the Subordinated Notes
Indenture Obligations would be entitled except for the provisions of Section 2.2
of the Intercreditor Agreement shall, and no payment over pursuant to the
provisions of said Section 2.2 to the holders of Senior Notes Indenture
Obligations by any Trustee shall, as between the Partnership, TCHI or Funding,
their creditors (other than the holders of the Senior Notes Indenture
Obligations) and the holders of the Indenture Obligations, be deemed to be a
payment by the Partnership, TCHI or Funding to or on account of Senior Notes
Indenture Obligations, it being understood that the provisions of said Section
2.2 are and are intended solely for the purposes of defining the relative rights
of the holders of the Subordinated Notes Indenture Obligations, on the one hand,
and the holders of the Senior Notes Indenture Obligations, on the other hand.
None of such provisions shall impair, as between the Partnership, TCHI or
Funding and any holder of Subordinated Notes Indenture Obligations, the
obligations of the Partnership, TCHI and/or Funding, which are
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<PAGE>
unconditional and absolute, to pay to such holders of Subordinated Notes
Indenture Obligations the full amount thereof, nor shall any such provisions
prevent any holder of Subordinated Notes Indenture Obligations from exercising
all rights, powers and remedies otherwise permitted by applicable law or under
the terms of the Subordinated Notes Indenture Documents upon a default
thereunder, subject to the rights under Section 2.2 of the Intercreditor
Agreement of holders of the Senior Notes Indenture Obligations. The Partnership,
TCHI and Funding hereby agree that, during any period in which they are not
permitted to make any payment to any Trustee by virtue of the provisions of the
Intercreditor Agreement, any applicable statute of limitations shall be tolled.
This consent shall become effective on the date hereinbelow set forth, and
shall be binding upon the undersigned and their respective successors and
assigns. Capitalized terms used in this consent and not defined herein shall
have the meaning for such terms set forth in the Intercreditor Agreement. The
miscellaneous provisions of the Intercreditor Agreement are applicable to this
consent.
TRUMP'S CASTLE ASSOCIATES. L.P.
By: Trump's Castle Hotel & Casino,
Witness: Inc., its general partner
/s/ Henry Smokler By: /s/ Nicholas L. Ribis
- -------------------- ---------------------------------
Name: Henry Smokler Nicholas L. Ribis
President and Chief Executive
Officer
Witness: TRUMP'S CASTLE FUNDING, INC.
/s/ Henry Smokler By: /s/ Nicholas L. Ribis
- -------------------- ---------------------------------
Name: Henry Smokler Nicholas L. Ribis
President and Chief Executive
Officer
Witness: TRUMP'S CASTLE HOTEL & CASINO, INC.
/s/ Henry Smokler By: /s/ Nicholas L. Ribis
- -------------------- ---------------------------------
Name: Henry Smokler Nicholas L. Ribis
President and Chief Executive
Officer
<PAGE>
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the Chief Executive Officer of TRUMP'S CASTLE HOTEL & CASINO,
INC., the general partner of TRUMP'S CASTLE ASSOCIATES, L.P., who I am satisfied
is the person who executed the within instrument, and he acknowledged that he
signed and delivered the same as such officer on behalf of such entity and that
the within instrument is the voluntary act and deed of said company made by
virtue of authority of its board of directors.
/s/ Marcus Chioffi
- --------------------------------------
Notary Public of the State of New York
[Seal]
<PAGE>
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me
the subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the Chief Executive Officer of TRUMP'S CASTLE FUNDING, INC.,
who I am satisfied is the person who executed the within instrument, and he
acknowledged that he signed and delivered the same as such officer on behalf of
such entity and that the within instrument is the voluntary act and deed of said
company made by virtue of authority of its board of directors.
/s/ Marcus Chioffi
- --------------------------------------
Notary Public of the State of New York
[Seal]
<PAGE>
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the Chief Executive Officer of TRUMP'S CASTLE HOTEL & CASINO,
INC., who I am satisfied is the person who executed the within instrument, and
he acknowledged that he signed and delivered the same as such officer on behalf
of such entity and that the within instrument is the voluntary act and deed of
said company made by virtue of authority of its board of directors.
/s/ Marcus Chioffi
- --------------------------------------
Notary Public of the State of New York
[Seal]
<PAGE>
SCHEDULE A
SUBORDINATED LIENS AND ENCUMBRANCES
1. Indenture of Mortgage and Security Agreement from Trump's Castle
Associates, a New Jersey general partnership to Trump's Castle Funding,
Inc., a New Jersey corporation, dated as of December 28, 1993, and
recorded December 29,1993 in mortgage book 5238, page 1 ($242,141,304.00
Note Mortgage).
Assignment Agreement from Trump's Castle Funding, Inc., a New Jersey
corporation, to First Bank National Association as Trustee, dated as of
December 28, 1993, and recorded December 29, 1993 in assignment book 651,
page 160.
Financing Statement from Trump's Castle Associates (Debtor) to Trump's
Castle Funding, Inc., assigned to First Bank National Association, filed
December 29, 1993 as #0014654.
2. Indenture of Mortgage and Security Agreement from Trump's Castle
Associates, a New Jersey general partnership to First Bank National
Association as Trustee, dated as of December 28, 1993, and recorded
December 29, 1993 in mortgage book 5239, page 1 ($242,141,304.00 Guarantee
Mortgage).
Financing Statement from Trump's Castle Associates (Debtor) to First Bank
National Association as Trustee, filed December 29, 1993 as #0014657.
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
(Senior Note Mortgage)
TRUMP'S CASTLE ASSOCIATES, L.P.
Mortgagor/Debtor
and
TRUMP'S CASTLE FUNDING, INC.,
Mortgagee/Secured Party
Dated as of April 17, 1998
Record and Return to:
Robert L. Nutt, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110-2624
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION.......8
Section 1.1. Definitions.................................................8
Section 1.2. Notices....................................................18
Section 1.3. Form and Contents of Documents Delivered to Mortgagee......19
Section 1.4. Compliance Certificates and Opinions.......................20
Section 1.5. Effect of Headings and Table of Contents...................21
Section 1.6. Successors and Assigns & Amendments........................21
Section 1.7. Separability Clause........................................21
Section 1.8. Benefits of Mortgage.......................................21
Section 1.9. Governing Law..............................................22
Section 1.10. Limitation on Liability....................................22
Section 1.11. Provisions Required by Senior Note Indenture...............22
Section 1.12. References to Mortgagee and/or to Trustee; Rights of
Trustee................................................22
Section 1.13. Mortgage Subject to Casino Control Act.....................24
Section 1.14. Discharge of Lien..........................................24
Section 1.15. General Application........................................25
Section 1.16. Senior Note Mortgage Deemed to be Security Agreement.......25
Section 1.17. No Duplication of Notices or Payments......................25
ARTICLE TWO RELEASE; SUBORDINATION........................................26
Section 2.1. Possession by Mortgagor....................................26
Section 2.2. Obsolete Property..........................................26
Section 2.3. F,F&E Financing Agreement..................................27
ARTICLE THREE REMEDIES...................................................28
Section 3.1. Events of Default..........................................28
Section 3.2. Acceleration of Maturity; Rescision and Annulment..........29
Section 3.3. Application of Moneys Received by Mortgagee................30
Section 3.4. Restoration of Rights and Remedies.........................30
Section 3.5. Rights and Remedies Cumulative.............................30
Section 3.6. Delay or Omission Not Waiver...............................30
Section 3.7. Undertaking for Costs......................................31
Section 3.8. Waiver of Appraisement and Other Laws......................31
Section 3.9. Entry......................................................31
Section 3.10. Power of Sale; Suits for Enforcement.......................32
Section 3.11. Incidents of Sale..........................................32
Section 3.12. Receiver...................................................33
Section 3.13. Suits to Protect the Trust Estate..........................34
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<PAGE>
Section 3.14. Management of the Premises.................................34
ARTICLE FOUR CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.........34
Section 4.1. Consolidation, Merger, Conveyance or Transfer only on
Certain Terms..........................................34
Section 4.2. Successor Entity Substituted...............................34
ARTICLE FIVE COVENANTS AND REPRESENTATIONS OF MORTGAGOR...................35
Section 5.1. Payment of Principal, Premium and Interest.................35
Section 5.2. F,F&E Financing Agreements.................................35
Section 5.3. Limitations on Liens and Transfers.........................35
Section 5.4. Environmental..............................................36
Section 5.5. Warranty of Leasehold Estate and Title.....................39
Section 5.6. After-Acquired Property; Further Assurances: Recording.....41
Section 5.7. Payment of Taxes and Certain Claims; Maintenance of
Properties; Compliance with Legal Requirement and
Insurance Requirements.................................42
Section 5.8. Permitted Contests.........................................44
Section 5.9. Mechanics' and Other Liens.................................44
Section 5.10. To Insure..................................................44
Section 5.11. Limitations on Building Demolition, Alterations,
Improvements and New Construction......................51
Section 5.12. Leases.....................................................53
Section 5.13. Compliance Certificates....................................54
Section 5.14. To Keep Books; Inspection by Mortgagee.....................55
Section 5.15. Advances by Mortgagee......................................55
Section 5.16. Waiver of Stay, Extension or Usury Laws....................55
Section 5.17. Eminent Domain.............................................56
Section 5.18. Facility Team..............................................57
Section 5.19. Indemnification............................................61
Section 5.20. TCHI Mortgages.............................................62
SCHEDULE 1 - OWNED LAND................................................1-1
SCHEDULE 2 - LEASED LAND...............................................2-1
SCHEDULE 3 - EXISTING ENCUMBRANCES.....................................3-1
SCHEDULE 4 - FORM OF NON-DISTURBANCE AND ATTORNMENT AGREEMENT..........4-1
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<PAGE>
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT ("Senior Note Mortgage"
or "Mortgage"), dated as of April 17, 1998 between TRUMP'S CASTLE ASSOCIATES,
L.P. a New Jersey limited partnership having an office at Brigantine Boulevard
and Huron Avenue. Atlantic City, New Jersey 08401 ("Mortgagor"), and TRUMP'S
CASTLE FUNDING, INC., a New Jersey corporation having an office at Brigantine
Boulevard and Huron Avenue, Atlantic City, New Jersey 08401 ("Mortgagee").
Witnesseth:
In consideration of $10.00 in hand paid by Mortgagee to Mortgagor
and for other good and valuable consideration, the receipt and sufficiency
whereof is hereby acknowledged, and in order to secure (i) the payment of the
principal amount (and premium, if any) of the Senior Partnership Note, in lawful
money of the United States, to be paid in accordance with the provisions thereof
(and of all modifications, extensions, and renewals thereof), all of which
provisions are hereby made an integral part hereof as though set forth at length
herein; (ii) payment of interest (including, without limitation, interest on all
overdue principal and premium, if any) becoming due under the provisions of the
Senior Partnership Note; (iii) payment by Mortgagor to Mortgagee of all sums
expended or advanced by Mortgagee pursuant to any term or provision of this
Senior Note Mortgage; (iv) performance of each covenant, term, condition and
agreement of Mortgagor herein or in the Senior Partnership Note contained; (v)
all costs and expenses, including, without limitation, reasonable counsel fees
and expenses as provided in Section 3.7 of this Mortgage, which may arise in
respect of the Senior Partnership Note and this Senior Note Mortgage or of the
obligations secured hereby; and (vi) performance and observance of all of the
provisions herein contained, Mortgagor has executed and delivered this Senior
Note Mortgage and has bargained, sold, alienated, mortgaged, pledged, released,
conveyed and confirmed unto Mortgagee and its successors hereunder and assigns
forever, and does hereby grant to Mortgagee and its successors a security
interest in and to, all of Mortgagor's right, title and interest in, to and
under all of the following described property and the proceeds thereof:
GRANTING CLAUSES
Granting Clause First
All of the property, rights, title, interest, privileges and
franchises particularly described in annexed Schedule 1 (the "Owned Land"),
which Schedule is hereby made a part of, and deemed to be described in, this
Granting
<PAGE>
Clause as fully as if set forth in this Granting Clause at length.
Granting Clause Second
[Intentionally omitted]
Granting Clause Third
All of the property, rights, title, interest, privileges and
franchises of Mortgagor as lessee under all Facility Leases (including, to the
extent permissible under the Marina Lease, the Marina Lease), together with (i)
all credits, deposits, privileges and rights of Mortgagor as lessee under the
Facility Leases, now or at any time existing, (ii) the leaseholds and the
leasehold estates created by the Facility Leases and (iii) all of the estates,
rights, titles, claims or demands whatsoever of Mortgagor, either in law or in
equity, in possession or in expectancy, of, in and to the Facility Leases and
the Leased Facilities (including, but not limited to, the Leased Land as
particularly described in annexed Schedule 2), together with (x) any and all
other, further or additional title, estates, interests or rights which may at
any time be acquired by Mortgagor in or to the Leased Facilities or any part
thereof, and Mortgagor expressly agrees that if Mortgagor shall, at any time
prior to payment in full of all indebtedness secured hereby, acquire fee simple
title or any other greater estate to the Leased Facilities, the lien of this
Mortgage, subject to Permitted Encumbrances, shall attach, extend to, cover and
be a lien upon such fee simple title or other greater estate and thereupon the
lien of this Mortgage, subject to Permitted Encumbrances, shall be prior to the
lien of any mortgage or deed of trust placed on such acquired title, estate,
interest or right subsequent to the date of this Mortgage and (y) any right to
possession or statutory term of years derived from, or incident to, the Facility
Leases pursuant to Section 365(h) of the Code or any Comparable Provision.
Granting Clause Fourth
All of the rents, issues, profits, revenues, accounts, accounts
receivable and other income and proceeds (including, without limitation, all
rents, fees, charges, accounts, issues, profits, revenues and payments for or
from (a) the use or occupancy of the rooms and other public facilities in the
Hotel and (b) the operation of the Casino) of the property subjected or required
to be subjected to the lien of this Mortgage, including, without limitation, the
property described in Granting Clauses First, Third and Seventh (said property
described in Granting Clauses First, Third and Seventh and similar other
property subjected or required to be subjected to the lien of this Mortgage,
together with all such rents, issues, profits, revenues, accounts, accounts
receivable and other income and proceeds therefrom is hereinafter collectively
referred to as the "Premises") and all of the estate, right, title and interest
of every
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<PAGE>
nature whatsoever of Mortgagor in and to the same and every part thereof.
Granting Clause Fifth
All of the rights of Mortgagor as lessor under the Leases in effect
on the date of execution of this Mortgage or hereafter entered into by
Mortgagor, including modifications, extensions and renewals of all of the same,
and the immediate and continuing right as security after the occurrence, and
during the continuance, of an Event of Default, to (a) make claim for, collect,
receive and receipt for (and to apply the same as provided herein) any and all
rents, fees, charges, income, revenues, issues, profits, security and other sums
of money payable or receivable thereunder or pursuant thereto, and all proceeds
thereof, whether payable as rent, insurance proceeds, condemnation awards,
security or otherwise and whether payable prior to or subsequent to the Stated
Maturity of the Senior Partnership Note, (b) receive and give notices and
consents thereunder, (c) bring actions and proceedings thereunder or for the
enforcement thereof, (d) make waivers and agreements thereunder or with respect
thereto, (e) take such action upon the happening of a default under any Lease,
including the commencement, conduct and consummation of any proceedings at law
or in equity as shall be permitted by any provision of any Lease, and (f) do any
and all things which Mortgagor or any lessor is or may become entitled to do
under the Leases; provided that, except as may be set forth to the contrary
herein, the assignment made by this Granting Clause Fifth shall not impair or
diminish any right, privilege or obligation of Mortgagor under the Leases nor
shall any such obligation be imposed upon Mortgagee.
Granting Clause Sixth
Without limiting the generality of the provisions of Granting Clause
Fourth, all of Mortgagor's rights, title, interest, privileges and franchises in
and to the following, now owned or hereafter acquired by Mortgagor, to the
extent of Mortgagor's interest therein and thereto and to the extent assignable
(collectively, "Operating Assets"):
(a) bookings for the use of guest rooms, banquet facilities,
meeting rooms at the Casino Hotel or at any other improvements now or hereafter
located on any of the Land;
(b) all contracts respecting utility services for, and the
maintenance, operations, or equipping of, the Premises, including guaranties and
warranties relating thereto;
(c) the Permits;
(d) all contract rights, leases (whether with respect to real
property, personal property or both real and personal property), concessions,
trademarks, trade names, service marks, logos, copyrights, warranties and other
items of intangible personal property, and any
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<PAGE>
and all good will associated with the same, relating to the ownership or
operation of the Casino Hotel or of any other improvements now or hereafter
located on any of the Land, including, without limitation, (1) employment
contracts with officers and other employees of Mortgagor, (2) telephone and
other communication numbers, (3) all software licensing agreements as are
required to operate computer software systems at the Casino Hotel or at any
other improvements now or hereafter located on any of the Land and books and
records relating to the software programs and (4) Mortgagor's interest under
leases of Tangible Personal Property;
(e) all contracts, purchase orders, requisitions and agreements
entered into by or on behalf of Mortgagor or which have been assigned to
Mortgagor, for the design, construction, and furnishing of the Casino Hotel or
of any other improvements now or hereafter located on any of the Land,
including, without limitation, architect's agreements, engineering agreements,
construction contracts, consulting agreements and agreements or purchase orders
for all items of Tangible Personal Property and payment and performance bonds in
favor of Mortgagor in connection with the Trust Estate (and all warranties and
guarantees thereunder and warranties and guarantees of any subcontractor and
bond issued in connection with the work to be performed by any subcontractor);
(f) the following personal property (the "Tangible Personal
Property") now or hereafter acquired by Mortgagor (directly or by way of lease)
which is located on, or to be located on, or which is in use or held in reserve
storage for future use in connection with the gaming or other operations of, the
Casino Hotel or of any other improvements now or hereafter located on any of the
Land, which is on hand or on order whether stored on-site or off-site:
(i) all furniture, furnishings, equipment, machinery,
lighting, apparatus (both interior and exterior), appliances, fixtures and
fittings and other articles of tangible personal property;
(ii) all slot machines, electronic gaming devices, crap
tables, blackjack tables, poker tables, roulette tables, baccarat tables,
big six wheels and other gaming tables, and all furnishings and equipment
to be used in connection with the operation thereof;
(iii) all cards, dice, gaming chips and plaques, tokens, chip
racks, dealing shoes, dice cups, dice sticks, layouts, paddles, roulette
balls and other consumable supplies and items;
(iv) all china, glassware, linens, kitchen utensils,
silverware and uniforms;
(v) all consumables and operating supplies of every kind and
nature, including, without limitation, accounting supplies, guest
supplies, forms. printing, stationery, food and beverage stock, bar
supplies, laundry supplies and brochures to existing purchase
-4-
<PAGE>
orders;
(vi) all upholstery material, carpets and rugs, beds, bureaus,
chiffoniers, chairs, chests, desks, bookcases, tables, curtains, hangings,
pictures, divans, couches, ornaments, bars, bar fixtures, safes, stoves,
ranges, refrigerators, radios, televisions, clocks; electrical equipment,
lamps, mirrors, heating and lighting fixtures and equipment, ice machines,
air conditioning machines, fire prevention and extinguishing apparatus,
laundry machines, and all similar and related articles used in bedrooms,
sitting rooms, bathrooms, boudoirs, halls, closets, kitchens, dining
rooms, offices, lobbies, basements and cellars in the Casino Hotel and in
any other improvements now or hereafter located on any of the Land;
(vii) all sets and scenery, costumes, props and other items of
tangible personal property on hand or on order for use in the production
of shows in any showroom, convention space, exhibition hall, or sports and
entertainment arena of the Casino Hotel or in any other improvements now
or hereafter located on any of the Land; and
(viii) all cars, limousines, vans, buses, trucks and other
vehicles owned or leased by Mortgagor for use in connection with the
operation of the Premises, together with all equipment, parts and supplies
used to service, repair, maintain and equip the foregoing;
(g) all drawings, designs, plans and specifications prepared by
architects, engineers, interior designers, landscape designers and any other
professionals or consultants for the design, development, construction and/or
improvement of the Casino Hotel, or for any other development of the Premises,
as amended from time to time;
(h) any administrative and judicial proceedings initiated by
Mortgagor, or in which Mortgagor has intervened, concerning the Premises, and
agreements, if any, which are the subject matter of such proceedings;
(i) any customer lists utilized by Mortgagor including lists of
transient guests and restaurant and bar patrons and "high roller" lists; and
(j) all of the good will in connection with the assets listed in
this Granting Clause Sixth and in connection with the operation of the Premises.
Except as may be set forth to the contrary herein, the assignment
made by this Granting Clause Sixth shall not impair or diminish any right,
privilege or obligation of Mortgagor with respect to the Operating Assets, nor
shall any such obligation be imposed on Mortgagee.
Granting Clause Seventh
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<PAGE>
(a) All of Mortgagor's rights, title, interest, privileges and
franchises, if any, in and to all buildings, structures (surface and
subsurface), and other improvements of every kind and description, including,
without limitation, all pedestrian bridges, entrance-ways, parking lots, plazas,
curb-cuts, walkways, driveways and landscaping and such fixtures as constitute
real property, now or hereafter erected or placed on the Land or on any other
land or any interest therein hereafter acquired by Mortgagor and all of
Mortgagor's rights, title, interest, privileges and franchises in and to all
fixtures and articles of personal property now or hereafter attached to or
contained in and used in connection with such buildings and improvements,
including, without limitation, all apparatus, furniture, furnishings, lighting
equipment, electronic billboards, machinery, motors, elevators, fittings,
radiators, cooking ranges, ice boxes, ice machines, printing presses, mirrors,
bars, mechanical refrigerators, furnaces, coal and oil burning apparatus, wall
cabinets, machinery, generators, partitions, steam and hot water boilers,
lighting and power plants, pipes, plumbing, radiators, sinks, bath tubs, water
closets, gas and electrical fixtures, awnings, shades, screens, blinds,
dishwashers, freezers, vacuum cleaning systems, office equipment and other
furnishings, and all plumbing, heating, lighting, cooking, laundry, ventilating,
incinerating, air-conditioning and sprinkler equipment or other fire prevention
or extinguishing apparatus and material, and fixtures and appurtenances thereto;
and all renewals or replacements thereof or articles in substitution therefor,
whether or not the same are or shall be attached to the Land, any other land or
any interest therein hereafter acquired by Mortgagor or to any such buildings
and improvements thereon, in any manner.
(b) All of Mortgagor's rights, title, interest, privileges and
franchises in and to all other property, real, personal or mixed (other than
Excepted Property), of every kind and description and wheresoever situate, now
owned or which may be hereafter acquired by Mortgagor, it being the intention
hereof that all property, interests, rights, privileges and franchises now owned
by Mortgagor or acquired by Mortgagor after the date hereof (other than Excepted
Property) shall be as fully embraced within and subjected to the lien hereof as
if such property were specifically described herein.
* * *
TOGETHER with all of Mortgagor's right, title and interest in and to
any and all mineral and water rights and any title or reversion, in and to the
beds of the ways, streets, avenues and alleys adjoining the Premises to the
center line thereof and in and to all strips, gaps and gores adjoining the
Premises on all sides thereof; and
TOGETHER with any and all of Mortgagor's right, title and interest
in and to the tenements, hereditaments, easements, appurtenances, passages,
waters, water courses, riparian rights, other rights, liberties and privileges
thereof or in any way now or hereafter appertaining to the Premises, including,
without limitation, any other claim at law or in equity as well as any
after-acquired title, franchise or license and the reversion and reversions and
remainder and remainders thereof; and
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<PAGE>
TOGETHER with any and all awards and other compensation heretofore
or hereafter to be made to the present and all subsequent owners of the Trust
Estate for any taking by eminent domain, either permanent or temporary, of all
or any part of the Trust Estate or any easement or appurtenances thereof,
including severance and consequential damage and change in grade of streets, all
in accordance with and subject to the provisions of the Superior Instrument
Requirements and Section 5.17; and
TOGETHER with any and all proceeds of any unearned premiums on any
insurance policies described in Section 5.10, and the right to receive and apply
the proceeds of any insurance, judgments, or settlements made in lieu thereof,
for damage to the Trust Estate or otherwise, all in accordance with and subject
to the provisions of Section 5.10 and the Superior Instrument Requirements; and
TOGETHER with all proceeds of every kind and nature, and all
products of every kind and nature, of any of the foregoing property, rights,
title, interests, privileges, franchises and other assets described in Granting
Clauses First through Seventh or in any of the other clauses thereafter.
The foregoing shall include, whether or not specifically identified
in one or more instances, all such property, rights, title, interests,
privileges, franchises and other assets now owned and/or hereafter existing.
EXCLUDING, with respect to all of the hereinabove granted property,
rights, title, interest, privileges and franchises described in Granting Clauses
First through Seventh or in the six immediately preceding paragraphs, all
Excepted Property now or hereafter existing.
TO HAVE AND TO HOLD all of said Premises, Leases, Facility Leases,
Operating Assets, properties, options, credits, deposits, rights, privileges and
franchises of every kind and description, real, personal or mixed, hereby and
hereafter granted, bargained, sold, alienated, assigned, transferred,
hypothecated, pledged, released, conveyed, mortgaged, or confirmed as aforesaid,
or intended, agreed or covenanted so to be, together with all the appurtenances
thereto appertaining (said Premises, Leases, Facility Leases, Operating Assets,
properties, options, credits, deposits, rights, privileges and franchises, other
than Excepted Property now or hereafter existing, being herein collectively
called the "Trust Estate") unto Mortgagee and its successors and assigns
forever.
PROVIDED, HOWEVER, that the lien of this Senior Note Mortgage upon
the Trust Estate shall rank pari passu with the lien of the Senior Guarantee
Mortgage, the lien of the TCHI Note Guarantee Mortgage, the Senior Partnership
Upstream Mortgage and the lien of any other Working Capital Facility Mortgage.
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<PAGE>
BUT IN TRUST, NEVERTHELESS, for the ratable benefit and security of
the Holders.
UPON CONDITION that, until the happening of an Event of Default,
Mortgagor shall be permitted to possess and use the Trust Estate, and to receive
and use the rents, issues, profits, revenues and other income of the Trust
Estate.
AND IT IS HEREBY COVENANTED AND DECLARED that the Trust Estate is to
be held and applied by Mortgagee, subject to the further covenants, conditions
and trusts hereinafter set forth, and Mortgagor does hereby covenant and agree
to and with Mortgagee, for the ratable benefit of the Holders, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
Section 1.1. Definitions.
For all purposes of this Senior Note Mortgage, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article One have the meanings
assigned to them in this Article One and include the plural as well as the
singular;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them, and all computations herein provided for shall be
made, in accordance with generally accepted accounting principles in effect on
the date hereof consistently applied; and
(c) the words "herein," "hereof" and "hereunder" and other words
of similar import refer to this Mortgage as a whole and not to any particular
Article, Section or other subdivision.
"Affiliate" has the meaning set forth in Section 1.1 of the Senior
Note Indenture.
"Alterations" has the meaning set forth in Section 5.11.
"Appraised Value" means the fair market value of the Casino Hotel,
and of all other property now or hereafter owned or leased by Mortgagor and
subject to the lien of this Mortgage, as determined by an independent Appraiser
on the basis of an appraisal in conformity with the criteria set forth at 12
C.F.R. ss. 564.4 or such similar published policy or regulation as from time to
time governs real estate related transactions by institutions regulated
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by the Office of Thrift Supervision; provided, that the value of the Casino
Hotel and such other property shall not include the value of (i) any furniture,
fixtures and equipment therein to the extent of the Outstanding Amount of any
Indebtedness secured by any F,F&E Financing Agreements with respect thereto and
(ii) any Excepted Property.
"Appraiser" means a "state certified appraiser" as defined in 12
C.F.R. ss. 564.2(i) who is (i) of recognized standing among appraisers of
properties similar to the Casino Hotel and (ii) experienced in the appraisals of
properties of a similar size and scope to that of the Casino Hotel, selected by
Mortgagor.
"Architect" means an Independent Person selected by Mortgagor and
licensed as an architect in the State of New Jersey.
"Casino" means that portion of the Casino Hotel used for gaming and
related activities.
"Casino Hotel" means the casino and hotel complex currently known as
the "Trump's Marina Hotel Casino" in Atlantic City, New Jersey, and ancillary
structures and facilities located on the Premises (other than the property
covered by the Marina Lease) and all furniture, fixtures and equipment at any
time contained therein in each case owned by or leased to Mortgagor.
"Casualty" means any act or occurrence of any kind or nature which
results in damage, loss or destruction to any buildings or improvements on the
Premises and/or Tangible Personal Property.
"Certificate of Appraised Value" means the certificate of an
Independent Appraiser stating the Appraised Value.
"Code" means the Federal Bankruptcy Code, Title 11 of the United
States Code, as amended.
"Company" means Trump's Castle Funding, Inc., a corporation
incorporated under the laws of the State of New Jersey, or any other obligor on
the Senior Notes (other than Mortgagor).
"Comparable Provision" has the meaning set forth in Section 5.18.
"Default" means any event which is, or after notice or lapse of time
or both would be, an Event of Default. Without limiting the generality of the
previous provisions of this definition, the term "Default" shall include the
occurrence of an event as to which a notice of default has been given to
Mortgagor under any Facility Lease by a Lessor which has not yet been cured.
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"Event of Default" has the meaning set forth in Section 3.1.
"Excepted Property" means:
(1) the personal property owned by lessees under Leases and the
personal property of any Hotel guests;
(2) trade names, intellectual property rights and other rights and
interests in and to the use of the terms "Trump's Castle," "Trump," "Trump's
Castle Casino Resort", "Trump Marina", "Trump Marina Hotel Casino", "Donald J.
Trump," "Donald Trump" or related variations thereof;
(3) any property deemed to be Excepted Property pursuant to the
provisions of Section 2.3;
(4) counterchecks, cash and any other property to the extent that
the granting of a security interest therein is prohibited by the New Jersey
Casino Control Act and the regulations promulgated thereunder;
(5) any property acquired pursuant to secured purchase-money
indebtedness permitted under clause "h" of the definition of "Permitted
Indebtedness" in the Senior Note Indenture; and
(6) all equity interests in any Person now owned or hereafter
acquired by Mortgagor (including, without limitation, the capital stock of the
Company) which are required to be pledged under the indenture (as the same may
be amended, modified, supplemented or restated) relating to the 15 1/2% senior
secured notes due 2005 of Trump Hotels & Casino Resorts Holdings, L.P.
and Trump Hotels & Casino Resorts Funding, Inc.
"Existing Encumbrances" means the matters set forth in Schedule 3
hereto.
"Facility Leases" means, collectively:
(1) the Marina Lease;
(2) any leases other than Capital Lease Obligations and the Marina
Lease where Mortgagor is tenant or sub-tenant; provided, however, that the
aggregate fixed rental payments paid or accrued for any period of four
consecutive fiscal quarters commencing after the date hereof under all such
leases (including payments required to be made by the lessee in respect of taxes
and insurance, whether or not denominated as rent), shall not exceed for such
period (a) $2,000,000 or (b) $7,500,000 following the time at which Mortgagor
shall have achieved EBITDA for any period of four consecutive quarters in an
amount not less than $45.0 million; provided, further, that the Mortgagor may
designate certain such leases which are not material
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to the operations of the Casino Hotel and which have aggregate fixed rental
payments (including payments required to be made by the lessee in respect of
taxes and insurance, whether or not denominated as rent) not exceeding an
aggregate of $300,000 per year to be excluded from the leases covered by this
clause (2); and
(3) any and all modifications, extensions and renewals of the leases
described in clauses (1) and (2) above, to the extent the same are permitted
under Section 5.18.
"F,F&E Financing Agreement" has the meaning set forth in Section 1.1
of the Senior Note Indenture.
"Full Insurable Value" means the actual replacement cost (excluding
the costs of foundation, footing, excavation, paving, landscaping and other
similar, noninsurable improvements) of the insurable properties in question.
"Holder" has the meaning set forth in Section 1.1 of the Senior Note
Indenture.
"Hotel" means that portion of the Casino Hotel not included within
the Casino.
"Impositions" has the meaning set forth in Section 5.7.
"Indebtedness" has the meaning set forth in Section 1.1 of the
Senior Note Indenture.
"Independent" when used with respect to any specified Person means
such a Person who (i) is in fact independent, (ii) does not have any direct
financial interest or any material indirect financial interest in Mortgagor or
in any other obligor upon the Senior Partnership Note or in any Affiliate of
Mortgagor or of such other obligor and (iii) is not connected with Mortgagor or
such other obligor or any Affiliate of Mortgagor or such other obligor as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions. Whenever it is herein provided that any
independent Person's opinion or certificate shall be furnished to Mortgagee,
such opinion or certificate shall state that the signer has read this definition
and that the signer is Independent within the meaning thereof. A Person who is
performing or who has performed services as an independent contractor to any
specified Person shall not be considered not Independent merely by reason of the
fact that such Person is performing or has performed such services.
"Insurance Amount" has the meaning set forth in Section 5.10(a)(i).
"Insurance Requirements" means all terms of any insurance policy
covering or applicable to the Trust Estate or any part thereof, all requirements
of the issuer of any such policy, and all orders, rules, regulations and other
requirements of the National Board of Fire Underwriters (or any other body
exercising similar functions) applicable to or affecting the Trust Estate or any
part thereof or any use or condition of the Trust Estate or any part thereof
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"Insurance Trustee" means the Trustee or, if the Trustee so elects,
any bank, trust company or insurance company with a net worth in excess of
$100,000,000, designated by the Trustee.
"Insurer" means (i) an insurance company or companies selected by
Mortgagor authorized to issue insurance in the State of New Jersey with an A.M.
Best rating level of A minus or better and an A.M. Best financial size category
of VIII or better or (ii) Lloyds of London so long as its financial capacity is
not such that prudent owners of first-class casino and hotel complexes in
Atlantic City, New Jersey would be unwilling to accept Lloyds of London;
provided, that with respect to the insurance required to be maintained pursuant
to Section 5.10(a)(i), up to 1.0% of the total amount of such insurance in
excess of the first $10,000,000 thereof may be maintained with an insurance
company or companies not meeting the foregoing A.M. Best rating level and/or
A.M. Best financial size categories; and Provided, further, that Mortgagor shall
in all events use commercially reasonable efforts to obtain insurance issued by
insurance companies having an A.M. Best rating level of better than A minus.
"Land" means, collectively, the Owned Land and the Leased Land.
"Lease" means each lease or sublease (made by Mortgagor, as lessor
or sublessor, as the case may be) of any space in any building or buildings, an
interest in which building or buildings constitutes a part of the Trust Estate,
including every agreement relating thereto or entered into in connection
therewith and every guarantee of the performance and observance of the
covenants, conditions and agreements to be performed by the lessee or sublessee
under any such lease or sublease. For purposes hereof, the term "Lease" shall
include any license agreement, concession agreement or other occupancy
agreement. Notwithstanding the foregoing, the term "Lease" shall not include any
transient room rentals.
"Leased Facilities" means, collectively, the Leased Land and any
buildings and improvements now or hereafter located thereon.
"Leased Land" means, collectively, the Marina Lease and any other
land that is now or hereafter subject to a Facility Lease.
"Legal Requirements" means all laws, statutes, codes, acts,
ordinances, orders, judgments, decrees, injunctions, rules, regulations,
permits, licenses, authorizations, directions and requirements (including,
without limitation, the New Jersey Casino Control Act, the New Jersey Industrial
Site Recovery Act and the New Jersey Spill Compensation and Control Act of 1976)
of all governments, departments, commissions, boards, courts, authorities,
agencies, officials and officers, of governments, federal, state and municipal
(including, without limitation, the New Jersey Department of Environmental
Protection, the Atlantic City Bureau of Investigations, the Division of Gaming
Enforcement of the State of New Jersey, and the Casino Control Commission of the
State of New Jersey), foreseen or unforeseen, ordinary or
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extraordinary. which now are or at any time hereafter become applicable to the
Trust Estate or any part thereof, or any of the adjoining sidewalks, or any use
or condition of the Trust Estate or any part thereof, including. without
limitation, the use of the Casino Hotel as a gaming or gambling facility.
"Lessors" means the lessors under the Facility Leases.
"Marina Lease" means the lease agreement made September 1, 1990
between the State of New Jersey, as Landlord, and Mortgagor, as tenant,
respecting property known as the Senator Frank S. Farley State Marina, Atlantic
City, New Jersey, being designated as a portion of Block B4, Lot 11 on the tax
map of the City of Atlantic City, Atlantic County, New Jersey, as more
particularly described on Schedule A appended hereto and made a part hereof,
together with all amendments, restatements, extensions and renewals of said
lease agreement, a memorandum of which Lease was recorded June 2, 1992 in the
Atlantic County Registry of Deeds in Book 5365, Page 21 1.
"Maturity" when used with respect to any Indebtedness means the date
on which the principal (or any portion thereof) of such Indebtedness becomes due
and payable as therein or herein provided, whether at the Stated Maturity, upon
acceleration, optional redemption, required repurchase, scheduled principal
payment or otherwise.
"Mortgage Documents" has the meaning set forth in Section 1.1 of the
Mortgage Note Indenture.
"Mortgage Note Indenture" means that certain indenture dated as of
December 28, 1993 among the Company, as issuer, the Mortgagor, as guarantor, and
First Bank National Association (now known as U.S. Bank National Association),
as trustee, as it may be amended from time to time, relating to the Company's
Mortgage Notes.
"Mortgage Notes" means the 11-3/4% Mortgage Notes due 2003 issued by
the Company pursuant to the Mortgage Note Indenture.
"Mortgagee" has the meaning set forth in the first paragraph of this
instrument and its successors and assigns.
"Mortgages" mean the Senior Guarantee Mortgage, the Senior Note
Mortgage, the TCHI Note Mortgage and the Senior Partnership Upstream Note
Mortgage.
"Mortgagor" means the Person named as "Mortgagor" in the first
paragraph Of this instrument until a successor entity shall have become such
pursuant to the applicable provisions of this Mortgage, and thereafter, except
to the extent otherwise contemplated by Section 4.2, "Mortgagor" shall mean such
successor entity exclusively.
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"Mortgagor Order" and "Mortgagor Request" mean, respectively, a
written order or request signed with a Mortgagor Signature and delivered to
Mortgagee.
"Mortgagor Signature" means the signature of the President or a Vice
President or a general partner of Mortgagor.
"Mortgagor's Certificate" means a certificate signed with a
Mortgagor Signature and delivered to Mortgagee.
"Notices" has the meaning set forth in Section 1.2.
"Operating Assets" has the meaning set forth in Granting Clause
Sixth.
"Opinion of Counsel" means a written opinion of counsel who may
(except as otherwise expressly provided in this Mortgage) be an employee of
Mortgagor or of an Affiliate of Mortgagor.
"Original Policy" means the ALTA Loan Policies of Title Insurance
issued by First American Title Insurance Company, Chicago Title Insurance
Company and Commonwealth Land Title Insurance Company, pursuant to Title
Commitment No. L980366, dated the date hereof.
"Outstanding Amount" has the meaning set forth in Section 1.1 of the
Senior Note Indenture.
"Owned Land" has the meaning set forth in Granting Clause First.
"Permits" means all licenses, franchises, authorizations, statements
of compliance, certificates of operation, certificates of occupancy. and permits
required for the lawful ownership, occupancy, operation and use of all or a
material portion of the Premises whether held by Mortgagor or any other Person
(which may be temporary or permanent) (including, without limitation, those
required for the use of the Casino Hotel as a licensed casino facility), in
accordance with all applicable Legal Requirements.
"Permitted Encumbrances" means:
(1) liens for taxes, assessments, or governmental charges not yet
due and payable, or if due and payable not delinquent, to the extent that any
fine, penalty, interest or cost may be added for nonpayment thereof;
(2) Existing Encumbrances;
(3) F,F&E Financing Agreements permitted by the Senior Note
Indenture or the TCHI
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Note Indenture;
(4) the liens of the Trustee provided for in Section 6.6 of the
Senior Note Indenture or the TCHI Note Indenture and of the trustees under the
corresponding sections of the Mortgage Note Indenture and the PIK Note
Indenture;
(5) any lien or encumbrance which, under the provisions of Section
5.7, constitutes a Permitted Encumbrance;
(6) Restricted Encumbrances;
(7) Working Capital Facility Mortgage (including the TCHI Note
Guarantee Mortgage and the Senior Partnership Upstream Note Mortgage);
(8) the liens of the Mortgage Documents;
(9) the liens of the Mortgages and any rights granted as provided
therein;
(10) any lien or encumbrance permitted under Section 5.3 of this
Mortgage;
(11) any lien or encumbrance securing purchase money indebtedness
permitted by the Senior Note Indenture and the TCHI Note Indenture;
(12) modifications, refinancings, extension, renewals or
replacements, in whole or in part, of the liens described in clauses (2) through
(11) of this definition to the extent permitted by the Senior Note Indenture and
the TCHI Note Indenture; and
(13) any Facility Lease now existing or hereafter entered into.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or any other entity or government or any agency or
political subdivision thereof.
"PIK Note Indenture" means that certain indenture dated as of
December 28, 1993 among the Company, as issuer, the Mortgagor, as guarantor, and
First Bank National Association (now known as U.S. Bank National Association),
as trustee, as it may be amended from time to time, relating to the Company's
PIK Notes.
"PIK Notes" means the Company's 13 7/8% Pay-in-Kind Notes due 2005.
"Premises" has the meaning set forth in Granting Clause Fourth.
"Restoration" has the meaning set forth in Section 5.10(e)(iii).
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"Restricted Encumbrances" means any Leases permitted by and made in
accordance with Section 5.12 of this Mortgage.
"Securities Act" has the meaning set forth in Section 1.1 of the
Senior Note Indenture.
"Senior Assignment Agreement" means the Senior Assignment Agreement
of even date herewith made by Mortgagee to the Trustee and acknowledged by
Mortgagor, providing for the assignment to the Trustee of the Senior Partnership
Note and this Senior Note Mortgage.
"Senior Guarantee" means the guarantee by Mortgagor of the Company's
Indenture Obligations (as defined in the Senior Note Indenture) pursuant to
Article Fourteen of the Senior Note Indenture.
"Senior Guarantee Mortgage" means the Indenture of Mortgage and
Security Agreement of even date herewith between the Trustee, as mortgagee, and
Mortgagor, as mortgagor, securing the Senior Guarantee and evidencing a lien
pari passu with the lien of this Mortgage, the lien of the TCHI Note Guarantee
Mortgage, the lien of the Senior Partnership Upstream Note Mortgage and the Lien
of any other Working Capital Facility Mortgage.
"Senior Indebtedness" means Indebtedness evidenced by the Senior
Partnership Note, the Senior Guarantee, the Senior Notes and any Working Capital
Facility (including, without limitation the TCHI Notes and the TCHI Guarantee)
and any amendments, extensions, renewals, replacements or restatements of any of
the foregoing to the extent permitted by the Senior Note Indenture and the TCHI
Note Indenture.
"Senior Note Indenture" means that certain indenture of even date
herewith between the Mortgagee, as issuer, the Mortgagor, as guarantor and the
Trustee, as trustee, relating to the Senior Notes as it may from time to time be
supplemented, modified or amended by one or more trust indentures or other
instruments supplemental thereto entered into pursuant to the applicable
provisions thereof.
"Senior Note Mortgage" means this Indenture of Mortgage and Security
Agreement, which evidences a lien pari passu with the lien of the Senior
Guarantee Mortgage, the lien of TCHI Note Guarantee Mortgage, the Senior
Partnership Upstream Note Mortgage and the lien of any other Working Capital
Facility Mortgage.
"Senior Notes" means the 10 1/4% Senior Secured Notes due 2003 in
the original principal amount of $62,000,000 issued by the Mortgagee under the
Senior Note Indenture.
"Senior Partnership Note" means that certain promissory note of even
date herewith in the original principal amount of $62,000,000 made by the
Mortgagor in favor of the Mortgagee, a copy of which is attached to the Senior
Note Indenture, and any amendments, extensions, renewals, replacements or
restatements thereof.
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"Senior Partnership Upstream Note" means that certain promissory
note of even date herewith in the original principal amount of $5,000,000 made
by the Mortgagor in favor of the TCHI a copy of which is attached to the TCHI
Note Indenture, and any amendments, extensions, renewals, replacements or
restatements thereof.
"Senior Partnership Upstream Note Mortgage" means certain Indenture
of Mortgage and Security Agreement, dated of even date herewith, among the
Mortgagor, as mortgagor/debtor, and TCHI, as mortgagee/secured party, securing
the Senior Partnership Upstream Note and which evidences a lien pari passu with
the lien of this Mortgage. the lien of the Senior Note Mortgage. the lien of the
Senior Guarantee Mortgage, the lien of the TCHI Note Guarantee Mortgage and the
lien of any other Working Capital Facility Mortgage.
"Settlement Costs" has the meaning set forth in Section 5.17.
"Stated Maturity" when used with respect to any Indebtedness, means
the date specified in such Indebtedness as the fixed date on which the principal
of such Indebtedness is due and payable.
"Superior Instrument Requirements" means the applicable terms,
conditions and provisions of any documentation which constitutes, evidences,
secures or governs any Senior Indebtedness, together with the terms and
provisions of the Marina Lease.
"Taking" means the acquisition or condemnation by eminent domain of
the whole or any part of the Premises, by a competent authority, for any public
or quasi-public use or purpose.
"Tangible Personal Property" has the meaning set forth in subclause
(f) of Granting Clause Sixth.
"TCHI" means Trump's Castle Hotel & Casino, Inc., a corporation
incorporated under the laws of the State of New Jersey, or any other obligor on
the TCHI Notes (other than Mortgagor).
"TCHI Guarantee" means the guarantee by Mortgagor of TCHI's
Indenture Obligations (as defined in the TCHI Note Indenture) pursuant to
Article 14 of the TCHI Note Indenture.
"TCHI Mortgages" means the TCHI Guarantee Mortgage and the Senior
Partnership Upstream Note Mortgage.
"TCHI Notes" means the 10 1/4% Senior Secured Notes due 2003 in the
original principal amount of $5,000,000 issued by TCHI pursuant to the TCHI Note
Indenture.
"TCHI Note Indenture" means that certain indenture of even date
herewith among
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TCHI, as issuer, Mortgagor as guarantor and U.S. Bank National Association, as
trustee, relating to the TCHI Notes as it may from time to time be supplemented,
modified or amended by one or more trust indentures or other instruments
supplemental thereto entered into pursuant to the applicable provisions thereof.
"TCHI Note Guarantee Mortgage" means the Indenture of Mortgage and
Security Agreement of even date herewith between U.S. Bank National Association,
as trustee, as mortgagee, and Mortgagor, as mortgagor, securing the TCHI
Guarantee and evidencing a lien pari passu with the lien of this Mortgage, the
lien of the Senior Guarantee Mortgage, the lien of the Senior Partnership
Upstream Note Mortgage and the lien of any other Working Capital Facility
Mortgage.
"Trust Estate" has the meaning stated in the habendum to the
Granting Clauses.
"Trust Indenture Act" has the meaning set forth in Section 1.1 of
the Trust Indenture.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of the Senior Note Indenture and any successor thereto.
"Uniform Commercial Code" means the New Jersey Uniform Commercial
Code N.J.S.A. 12A:1-101, et seq.
"Working Capital Facility" has the meaning set forth in Section 1.1
of the Senior Note Indenture.
"Working Capital Facility Mortgage" means any mortgage or other
security interest (including, without limitation, the TCHI Note Guarantee
Mortgage and the Senior Partnership Upstream Note Mortgage) or agreement which
secures a Working Capital Facility and which evidences a lien pari passu with
the lien of this Senior Note Mortgage, the lien of the Senior Guarantee
Mortgage, the lien of the TCHI Note Guarantee Mortgage and the lien of the
Senior Partnership Upstream Note Mortgage.
Section 1.2. Notices.
(a) Any request, demand, authorization, direction, notice
(including, without limitation, a notice of default), consent, waiver or other
document provided or permitted by this Mortgage to be made upon, given or
furnished to, or filed with, Mortgagor, Mortgagee or the Trustee (collectively,
"Notices") shall be in writing and shall be deemed given either (i) when
delivered by hand (including by overnight courier) or (ii) two days after
sending by registered or certified mail, postage prepaid, addressed as follows:
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To Mortgagor:
Trump's Castle Associates L.P.
Trump Marina Hotel Casino
Brigantine Boulevard and
Huron Avenue
Atlantic City, New Jersey 08401
Attn: Chief Financial Officer
and and after May 26, 1998:
Willkie Farr & Gallagher Willkie, Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, NY 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
To Mortgagee:
Trump's Castle Funding, Inc.
Trump Marina Hotel Casino
Brigantine Boulevard and
Huron Avenue
Atlantic City, New Jersey 08401
Attn: Chief Financial Officer
and and after May 26, 1998:
Willkie Farr & Gallagher Willkie, Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, NY 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
To the Trustee:
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Administration
(b) By Notice to Mortgagor, Mortgagee and the Trustee, any party
may designate additional or substitute addresses for Notices which,
notwithstanding Subsection (a) above, shall be deemed given when received. So
long as the Assignment Agreement is in effect, all Notices to and from Mortgagee
shall be given solely to and by the Trustee.
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Section 1.3. Form and Contents of Documents Delivered to Mortgagee.
Whenever several matters are required to be certified by, or covered
by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and one or more
other such Persons as to other such matters in one or several documents.
Any certificate or opinion of a general partner of Mortgagor may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such general partner knows that the
certificate or opinion or representations with respect to the matters upon which
his certificate or opinion is based are erroneous. Any Opinion of Counsel may be
based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, a general partner of Mortgagor stating that the
information with respect to such factual matters is in the possession of
Mortgagor, unless such counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous. If appropriate to
the matter being opined upon and to the extent not prohibited by the Trust
Indenture Act, conclusions stated in any Opinion of Counsel may be subject to
rights of creditors and the availability of equitable remedies.
Whenever any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Mortgage, they may, but need not, be consolidated to form
one instrument.
Whenever in this Mortgage, in connection with any application or
certificate or report to Mortgagee, it is provided that Mortgagor shall deliver
any document as a condition of the granting of such application, or as evidence
of Mortgagor's compliance with any term hereof, it is intended that the truth
and accuracy, at the time of the granting of such application or at the
effective date of such certificate or report (as the case may be), of the facts
and opinions stated in such document shall in such case be conditions precedent
to the right of Mortgagor to have such application granted or to the sufficiency
of such certificate or report.
Every application, certificate, report, affidavit, opinion, consent,
statement or other instrument required to be delivered to Mortgagee under this
Senior Note Mortgage shall be in writing and shall be prepared and delivered
without cost or expense to Mortgagee.
Section 1.4. Compliance Certificates and Opinions.
Upon any application or request by Mortgagor to Mortgagee to take
any action under any provision of this Senior Note Mortgage, Mortgagor shall
furnish to Mortgagee a Mortgagor's Certificate stating that all conditions
precedent, if any, provided for in this Senior Note Mortgage relating to the
proposed action have been complied with and an Opinion of Counsel stating that
in the opinion of such counsel all such conditions precedent, if any, have
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been complied with, except that in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Senior Note Mortgage relating to such particular application
or request, no additional certificate or opinion need be furnished. Every
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Senior Note Mortgage shall include:
(a) a statement that each individual signing such certificate or
opinion has read such condition or covenant and the definitions herein relating
thereto;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such condition or covenant has been
complied with; and
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.5. Effect of Headings and Table of Contents.
The Article and Section headings herein and in the Table of Contents
are for convenience only and shall not affect the construction hereof.
Section 1.6. Successors and Assigns & Amendments.
(a) Subject to the provisions of Sections 1.10 and 4.2 hereof and
Sections 3.11 and 8.2 of the Senior Note Indenture, and without limiting the
generality of Section 1.12 hereof, this Mortgage shall be binding upon and inure
to the benefit of the parties hereto and of the respective successors and
assigns of the parties hereto to the same effect as if each such successor or
assign were in each case named as a party to this Mortgage.
(b) This Senior Note Mortgage may not be modified, amended,
discharged, released nor any of its provisions waived except by agreement in
writing executed by Mortgagor and Mortgagee and in accordance with the
provisions of this Mortgage and the Senior Note Indenture.
Section 1.7. Separability Clause.
In case any provision in this Mortgage or the Senior Partnership
Note shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
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Section 1.8. Benefits of Mortgage.
Without limiting the generality of Section 3.12, nothing in this
Mortgage or in the Senior Partnership Note, express or implied, shall give to
any Person, other than the parties hereto and their successors and assigns, any
benefit or any legal or equitable right, remedy or claim under this Mortgage.
Section 1.9. Governing Law.
This Senior Note Mortgage shall be deemed to be a contract under the
laws of the State of New Jersey and shall be construed in accordance with and
governed by the laws of the State of New Jersey.
Section 1.10. Limitation on Liability.
Notwithstanding anything herein or in any other agreement, document,
certificate, instrument, statement or omission referred to below to the
contrary, Mortgagor is liable hereunder only to the extent of the assets of
Mortgagor and no other person or entity, including, without limitation, any
partner, officer, committee or committee member of Mortgagor or any partner
therein or in any partnership Affiliate of Mortgagor, or any incorporator,
officer, director or shareholder of any corporate partner of Mortgagor or of any
corporate Affiliate of Mortgagor, or any Affiliate or controlling person or
entity of any of the foregoing, or any agent, employee, or lender of any of the
foregoing, or any successor, personal representative, heir or assign of any of
the foregoing, in each case past, present or as they may exist in the future,
shall be liable in any respect (including, without limitation, the breach of any
representation, warranty, covenant, agreement, condition or indemnification or
contribution undertaking contained herein or therein) under, in connection with,
arising out of or relating to this Senior Note Mortgage, or any other agreement,
document, certificate, instrument or statement (oral or written) related to,
executed or to be executed, delivered or to be delivered, or made or to be made,
or any omission made or to be made, in connection with any of the foregoing or
any of the transactions contemplated in any such agreement, document,
certificate, instrument, or statement. Any agreement, document, certificate,
statement or other instrument to be executed simultaneously with, in connection
with, arising out of or relating to this Senior Note Mortgage or any other
agreement, document, certificate, statement or instrument referred to above, or
any agreement, document, certificate, statement or instrument contemplated
hereby shall contain language mutandis to this Section 1.10 and, if such
language is omitted, shall be deemed to contain such language.
Section 1.11. Provisions Required by Senior Note Indenture.
Whenever the provisions of this Senior Note Mortgage and the
provisions of the Senior Note Indenture shall be inconsistent, the provisions of
the Senior Note Indenture shall govern.
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Section 1.12. References to Mortgagee and/or to Trustee; Rights of Trustee.
(a) Whenever reference is made in this Mortgage to the rights,
powers and remedies of Mortgagee or to Notices to or by Mortgagee, the same
shall apply to Trump's Castle Funding, Inc. only so long as Trump's Castle
Funding, Inc. is the holder of this Mortgage and the Senior Partnership Note.
Subsequent to the assignment thereof on the date of and pursuant to the Senior
Assignment Agreement by Trump's Castle Funding, Inc. to the Trustee (who shall
have and hold all such rights, powers and remedies on behalf of the Holders in
accordance with the terms of the Senior Note Indenture) and for so long as there
shall not have been effected a cancellation and discharge of the assignment
pursuant to Article V of the Senior Assignment Agreement, such rights, powers
and remedies of Mortgagee and any Notices to or by Mortgagee, shall apply only
to the Trustee with the same force and effect as if (i) such rights, powers and
remedies were specifically granted by this Senior Note Mortgage and the Senior
Partnership Note directly to the Trustee and (ii) the Trustee were the named
Mortgagee with respect to the giving and receiving of Notices under Section 1.2.
Upon such assignment of this Senior Note Mortgage, the Trustee shall be named in
lieu of Trump's Castle Funding, Inc., as a named insured under the policies of
insurance set forth in Section 5.10 hereof (except that with respect to the
policy described in Section 5.10(a)(iii) of this Mortgage, Trump's Castle
Funding, Inc. may, at Mortgagor's election, be named as an additional insured).
(b) So long as there shall not have been effected a cancellation
and discharge of the assignment pursuant to Article V of the Senior Assignment
Agreement, except as otherwise provided in Section 6.2 of the Senior Note
Indenture:
(1) Mortgagee may rely, and shall be protected in acting or
refraining from acting, upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(2) any request or direction of Mortgagor mentioned herein
shall be sufficiently evidenced by a Mortgagor Request or Mortgagor Order;
(3) whenever in the administration of this Mortgage, Mortgagee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, Mortgagee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon a Mortgagor's Certificate;
(4) Mortgagee may consult with counsel and any written advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by Mortgagee hereunder in good faith and in reliance thereon;
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(5) Mortgagee shall be under no obligation to exercise any of
the rights or powers vested in it by this Mortgage at the request or
direction of any of the Holders pursuant to the Senior Note Indenture,
unless such Holders shall have offered to Mortgagee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred therein or thereby in compliance with such request or direction;
(6) Mortgagee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, approval, appraisal, bond, debenture, note, coupon,
security or other paper or document but Mortgagee, in its discretion, may
make such further inquiry or investigation into such facts or matters as
it may see fit, and, if Mortgagee shall determine to make such further
inquiry or investigation, it shall be entitled (subject to the express
limitations with respect thereto contained in this Senior Note Mortgage)
to examine the books, records and premises of Mortgagor, personally or by
agent or attorney;
(7) Mortgagee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys, and Mortgagee shall not be responsible for any
misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder;
(8) Mortgagee shall not be personally liable, in case of entry
by it upon the Trust Estate, for debts contracted or liabilities or
damages incurred in the management or operation of the Trust Estate;
(9) Mortgagor shall pay or cause to be paid to the Trustee all
compensation and other amounts provided in Section 6.6 of the Senior Note
Indenture; and
(10) no provision of this Mortgage shall require Mortgagee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of its obligations hereunder, or in the exercise of any of
its rights or powers.
(c) The provisions of Section 1.12(a) shall apply to all Mortgage
Documents executed in favor of Trump's Castle Funding, Inc. The provisions of
Section 1.12(b) shall apply to all Mortgage Documents.
Section 1.13. Mortgage Subject to Casino Control Act.
Each provision of this Senior Note Mortgage is subject to and shall
be enforced in compliance with the provisions of the New Jersey Casino Control
Act.
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Section 1.14. Discharge of Lien.
If (a) Mortgagor shall pay or cause to be paid, or there shall
otherwise be paid, to Mortgagee all amounts required to be paid by Mortgagor
pursuant to this Mortgage and the Senior Partnership Note and the conditions
precedent for the Senior Note Indenture to cease, determine and become null and
void (except for any surviving rights of transfer or exchange of the Senior
Notes provided in Section 13.1 of the Senior Note Indenture and for the
obligation to pay the Trustee's fees and expenses provided in Section 6.6 of the
Senior Note Indenture) in accordance with Section 13.1 of the Senior Note
Indenture shall have occurred, or (b) there shall have occurred a "defeasance"
(as defined in Section 4.2 of the Senior Note Indenture) of the Senior Notes, or
(c) there shall have occurred a "covenant defeasance" (as defined in Section 4.3
of the Trust Indenture), then in any such case Mortgagee shall promptly cancel
and discharge this Mortgage, and any financing statements filed in connection
herewith and execute and deliver to Mortgagor all such instruments as may be
necessary, required or appropriate to evidence such discharge and satisfaction
of said lien or liens.
Section 1.15. General Application.
(a) The remedies of Mortgagee upon any default by Mortgagor in the
fulfillment of any of its obligations hereunder shall be limited in each
instance by the provisions of Section 1.10, whether or not the provisions
providing for such remedies explicitly refer to such Section.
(b) The assertion of any rights upon any Default shall be subject
in each instance to, if required, the giving of any notice and the expiration of
any grace period provided for in Section 3.1 as a condition to such Default
becoming an Event of Default, unless the Trust Indenture Act requires otherwise,
in which case the Trust Indenture Act shall control.
(c) For the purposes of this Senior Note Mortgage, it is
understood that an event which does not materially diminish the value of
Mortgagee's interest in the Trust Estate shall not be deemed an "impairment of
security," as that phrase is used in this Mortgage.
Section 1.16. Senior Note Mortgage Deemed to be Security Agreement.
To the extent that the grant of a security interest in any portion
of the Trust Estate is governed by the Uniform Commercial Code, this Senior Note
Mortgage is hereby deemed to be as well a security agreement under the Uniform
Commercial Code for the purpose of creating hereby a security interest in all of
Mortgagor's right, tide and interest in and to said property, securing the
obligations secured hereby, for the benefit of Mortgagee.
Section 1.17. No Duplication of Notices or Payments.
Whenever it is provided in this Senior Note Mortgage and the Senior
Guarantee
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Mortgage, that Mortgagor shall deliver any notice or document, or is required to
make any payment, the delivery of such notice or document or the making of such
payment shall constitute the delivery of such notice or document or the making
of such payment in satisfaction of the terms, conditions and provisions of this
Senior Note Mortgage, and the Senior Guarantee Mortgage, provided that such
notice, document or payment states, or is accompanied by a letter stating, that
such notice, document or payment is being delivered in satisfaction of the
terms, conditions and provisions of both this Mortgage and the Senior Guarantee
Mortgage.
ARTICLE TWO
RELEASE; SUBORDINATION
Section 2.1. Possession by Mortgagor.
So long as there shall have been no acceleration of maturity of the
Senior Partnership Note under Section 3.2, Mortgagor shall be suffered and
permitted, with power freely and without let or hindrance on the part of
Mortgagee, subject to the provisions of this Mortgage and the Senior Note
Indenture, to possess, use, manage, operate and enjoy the Trust Estate and every
part thereof and to collect, receive, use, invest and dispose of the rents,
issues, tolls, profits, revenues and other income from the Trust Estate or any
part thereof, to use, consume and dispose of any consumables, goods, wares and
merchandise in the ordinary course of business of operating the Casino Hotel and
to adjust and settle all matters relating to choses in action, leases and
contracts.
Section 2.2. Obsolete Property.
Mortgagor shall have the right, at any time and from time to time,
unless an Event of Default shall have occurred and be continuing, without any
release from or consent by Mortgagee:
(a) to sell or dispose of, free from the lien of this Mortgage,
any Tangible Personal Property which, in its reasonable opinion, may have become
obsolete or unfit for use or which is no longer necessary in the conduct of its
businesses or the operation of the Trust Estate, and no purchaser of any such
property shall be bound to inquire into any question affecting Mortgagor's right
to sell or otherwise dispose of the same free from the lien of this Mortgage;
(b) to alter, repair, replace, change the location or position of
and add to any Tangible Personal Property; provided, however, that no change
shall be made in the location of any such property subject to the lien of this
Mortgage which would in any respect impair the security of this Mortgage upon
such property; or
(c) to renew, extend, surrender, terminate, modify or amend any
leases of Tangible
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Personal Property, when, in Mortgagor's reasonable opinion, it is prudent to do
so.
Mortgagor shall retain any net cash proceeds received from the sale
or disposition of any Tangible Personal Property under Subsection (a) of this
Section 2.2, in the business of operating the Casino Hotel.
Mortgagee shall be under no responsibility or duty with respect to
the exercise of the rights of Mortgagor under this Section 2.2 or the
application of the proceeds of any sale or disposition of any Tangible Personal
Property.
Mortgagee shall, from time to time, promptly execute any written
instrument in form satisfactory to Mortgagee to confirm the propriety of any
action taken by Mortgagor under this Section 2.2, upon receipt by Mortgagee of a
Mortgagor Request requesting the same, together with a Mortgagor's Certificate
stating that the action so to be confirmed was duly taken in conformity with
this Section 2.2, and that the execution of such written instrument is
appropriate to confirm the propriety of such action under this Section 2.2;
provided, that Mortgagee shall have no liability thereunder and all costs and
expenses (including, without limitation, reasonable attorneys' fees and
disbursements) shall be paid by Mortgagor.
Section 2.3. F,F&E Financing Agreement.
Notwithstanding any provision contained in this Mortgage or the
Senior Note Venture to the contrary, if Mortgagor acquires Tangible Personal
Property and/or other items constituting operating assets subject to any F,F&E
Financing Agreement, or becomes the lessee under a lease for any of the same and
if the document evidencing such F,F&E Financing Agreement prohibits subordinate
liens or the provisions of any such lease prohibits any assignment thereof by
the lessee, and if any such prohibition is customary with respect to similar
transactions of the lender or lessor (as evidenced by a Mortgagor's Certificate
delivered to Mortgagee, together with such other evidence as Mortgagee may
reasonably request), as the case may be, then the property so purchased or the
lessee's interest in the lease, as the case may be, shall be deemed to be
Excepted Property. If any such F,F&E Financing Agreement permits subordinate
liens, then Mortgagee shall execute and deliver to Mortgagor, at Mortgagor's
expense, such documents as the holder of such F,F&E Financing Agreement may
reasonably request to evidence the subordination of the lien of this Mortgage
and the Mortgage Documents to the lien of such F,F&E Financing Agreement;
provided, however, that Mortgagee shall have no obligation to execute and
deliver such documents, and the lien of this Mortgage shall not be subordinate
to any such F,F&E Financing Agreement, unless (a) such F,F&E Financing Agreement
shall contain a provision binding upon the holder of such F,F&E Financing
Agreement that (i) if the holder of such F,F&E Financing Agreement shall give to
Mortgagor any notice of default thereunder, such holder shall at the same time
and in the same manner serve a copy of such notice on Mortgagee at the address
designated herein (or such other address as Mortgagee may designate by notice
given to the holder of such F,F&E Financing Agreement in the manner provided for
notices hereunder), and that no such notice to
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Mortgagor shall be deemed to have been duly given unless and until a copy
thereof has been so provided to Mortgagee, and (ii) promptly following the last
date upon which Mortgagor may cure such default, if Mortgagor shall fail to cure
such default, the holder of such F,F&E Financing Agreement shall give notice to
Mortgagee stating the manner in which Mortgagor shall have failed to cure its
said default, in which event Mortgagee shall be permitted to cure the default
and, with respect thereto, Mortgagee shall have the same amount of time, after
such notice, within which to cure the said default, as is provided for under the
provisions of such F,F&E Financing Agreement to be given to Mortgagor therefor
after notice or (b) Mortgagor delivers to Mortgagee a Mortgagor's Certificate
certifying that (i) the provision described in clause (a) is not customarily
included by the lender or lessor in its F,F&E Financing Agreements in similar
transactions and (ii) although Mortgagor has used reasonable efforts to have
included in such F,F&E Financing Agreement such a provision, Mortgagor has been
unsuccessful in obtaining such a provision.
ARTICLE THREE
REMEDIES
Section 3.1. Events of Default.
"Event of Default," whenever used herein, means any one of the
following events (including any applicable notice requirement and any period of
grace, as specified in this Section 3.1) (whatever the reason for such event and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) default in the payment of any interest on the Senior Notes or
the Senior Partnership Note when such interest becomes due and payable and
continuance of such default for a period of 30 days; or
(b) default in the payment of all or any portion of the principal of
(or premium, if any, on) the Senior Notes or the Senior Partnership Note when
the same becomes due and payable at their Maturity; or
(c) default in the payment of any other sum due under the Senior
Partnership Note or this Senior Note Mortgage, and the continuance of such
default for a period of 30 days after there has been given to Mortgagor a notice
specifying such default and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(d) default in the payment or performance of any obligation under
the Senior Guarantee at the time such payment or performance is required under
Article Fourteen of the Senior Note Indenture.
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(e) default in the performance, or breach, of any covenant of
Mortgagor in this Senior Note Mortgage (other than a covenant, a default in the
performance or breach of which is elsewhere in this Section 3.1 specifically
dealt with), and continuance of such default or breach for a period of 30 days
after there has been given to Mortgagor a notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder, unless (i) the default or breach is of such a nature that
is curable but not susceptible of being cured with due diligence within such
30-day period (for reasons other than the lack of funds), (ii) Mortgagor
delivers a Mortgagor's Certificate to Mortgagee within such 30-day period
stating (A) the applicability of the provisions of clause (i) to such default or
breach, (B) Mortgagor's intention to remedy such default or breach with
reasonable diligence and (C) the steps which Mortgagor has undertaken or intends
to undertake to remedy such default or breach and (iii) Mortgagor delivers to
Mortgagee additional Mortgagor's Certificates every 30 days thereafter updating
the information contained in the certificate described in clause (ii), in which
case such 30-day period shall be extended for such further period of time (but
in no event more than 60 days after the last day of such 30-day period) as may
reasonably be required to cure the same, provided that Mortgagor is then
proceeding and thereafter continues to proceed to cure the same with reasonable
diligence; or
(f) an "Event of Default," as defined in Section 5.1 of the Senior
Note Indenture, shall occur and be continuing; or
(g) default by Mortgagor under any terms of any Facility Lease which
shall not be fully cured or waived prior to the expiration of any grace period
(as such grace period may be extended) contained in such Facility Lease; or
(h) default in the performance, or breach, of any of the provisions
of Article Four hereof; or
(i) if any representation or warranty of Mortgagor set forth in this
Senior Note Mortgage or in any notice, certificate, demand or request delivered
to Mortgagee pursuant to this Mortgage shall prove to be incorrect in any
material respect as of the time when made; or
(j) an "Event of Default," as defined in Section 3.1 of the Senior
Guarantee Mortgage, the TCHI Note Guarantee Mortgage, the Senior Partnership
Upstream Note Mortgage or the Mortgage Documents shall occur and be continuing.
An Event of Default shall not be deemed to exist by reason of any
event which Mortgagor is contesting in compliance with the provisions of Section
5.8.
Section 3.2. Acceleration of Maturity; Rescision and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(g) or (h) of the Senior Note Indenture) occurs and is continuing,
then, and in every such case,
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Mortgagee may declare the Outstanding Amount of the Senior Partnership Note to
be due and payable immediately, by a notice in writing to Mortgagor and upon any
such declaration such principal shall become immediately due and payable. If an
Event of Default specified in such Section 5.1(g) or (h) occurs, the Outstanding
Amount of the Senior Partnership Note shall ipso facto become due and payable
without any declaration or other act on the part of the Mortgagee.
If at any time after such declaration of acceleration has been made,
but before any judgment or decree for payment of money due on the Senior
Partnership Note has been obtained by the Mortgagee, such declaration of
acceleration and its consequences has been duly rescinded and annulled in
accordance with Section 5.2 of the Senior Note Indenture, then the declaration
of acceleration pursuant to this Section 3.2 shall automatically be rescinded
and annulled.
No such rescission and annulment shall affect any subsequent default
or impair any right consequent thereon.
Section 3.3. Application of Moneys Received by Mortgagee.
Any moneys received by Mortgagee pursuant to the provisions of this
Article Three (including moneys received by the Trustee after any action or act
by Mortgagee under Section 3.10) shall be applied by Mortgagee in accordance
with the provisions of Section 5.6 of the Senior Note Indenture.
Section 3.4. Restoration of Rights and Remedies.
If Mortgagee has instituted any proceeding to enforce any right or
remedy under this Senior Note Mortgage and such proceeding has been discontinued
or abandoned for any reason or has been determined adversely to Mortgagee, then
and in every such case Mortgagor and Mortgagee shall, subject to any
determination in such proceeding, be restored to their respective former
positions hereunder, and thereafter all rights and remedies of Mortgagee shall
continue as though no such proceeding had been instituted.
Section 3.5. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to Mortgagee is
intended to be exclusive of any other right or remedy, in every right and remedy
shall, to the extent permitted by law, be cumulative and in addition to every
other right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy hen
under, or otherwise, shall not prevent the concurrent assertion or employment of
any other appropriate right or remedy.
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Section 3.6. Delay or Omission Not Waiver.
No delay or omission of Mortgagee to exercise any right or remedy
accruing upon an Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article Three or by applicable law to
Mortgagee may be exercised, from time to time, and as often as may be deemed
expedient, by Mortgagee.
Section 3.7. Undertaking for Costs.
If any action or proceeding shall be commenced (including, without
limitation, an action to foreclose this Mortgage or to collect the indebtedness
secured hereby) to which action or proceeding Mortgagee is made or becomes a
party, or in which it becomes necessary in the opinion of Mortgagee to defend or
uphold the lien of this Senior Note Mortgage, Mortgagor shall pay to Mortgagee
all expenses, including, without limitation, reasonable attorneys' fees,
disbursements and court costs incurred by Mortgagee in connection therewith,
together with interest at the rate then payable on the Senior Partnership Note,
from the date of payment less the net amount received by Mortgagee or the
Trustee, as their interests may appear under any title insurance policy, and,
until paid, all such expenses, together with interest as aforesaid, shall be
secured by the lien of this Mortgage.
Section 3.8. Waiver of Appraisement and Other Laws.
To the full extent that it may lawfully so agree, Mortgagor will not
at any time insist upon, plead, claim or take the benefit or advantage of, any
appraisement, valuation, stay, extension or redemption law now or hereafter in
force, in order to prevent or hinder the enforcement of this Mortgage or the
absolute sale of the Trust Estate, or any part thereof, or the possession
thereof by any purchaser at any sale under this Article Three; and Mortgagor,
for itself and all who may claim under Mortgagor, so far as Mortgagor or they
now or hereafter may lawfully do so, hereby waives the benefit of all such laws.
Mortgagor, for itself and all who may claim under Mortgagor, waives, to the
extent that Mortgagor may lawfully do so, all right to have the property in the
Trust Estate marshaled upon any foreclosure hereof, and agrees that any court
having jurisdiction to foreclose this Mortgage may order the sale of the Trust
Estate as an entirety.
If any law in this Section 3.8 referred to and now in force, of
which Mortgagor or its successor or successors might take advantage despite this
Section 3.8, shall hereafter be repealed or cease to be in force, such law shall
not thereafter be deemed to constitute any part of the contract herein contained
or to preclude the application of this Section 3.8.
Section 3.9. Entry.
Mortgagor agrees that upon the occurrence, and during the
continuance, of an Event of
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Default, Mortgagor, upon demand of Mortgagee, shall forthwith surrender to
Mortgagee the actual possession of, and it shall be lawful for Mortgagee by such
officers or agents as it may appoint to enter and take possession of, the Trust
Estate (and the books and papers of Mortgagor), and to hold, operate and manage
the Trust Estate (including the making of all needful repairs, and such
alterations, additions and improvements as Mortgagee shall deem wise) and to
receive the rents, issues, tolls, profits, revenues and other income thereof,
and, after deducting the costs and expenses of entering, taking possession,
holding, operating and managing the Trust Estate, as well as payments for taxes,
insurance and other proper charges upon the Trust Estate and reasonable
compensation to itself, its agents and counsel, to apply the same as provided in
Section 3.3; provided, however, that Mortgagee's rights under this Section 3.9
shall be subject to the provisions of the New Jersey Casino Control Act and
Section 3.14. Whenever all that is then due upon the Senior Partnership Note and
under any of the terms of this Mortgage shall have been paid and all defaults
hereunder shall have been cured, Mortgagee shall surrender possession to
Mortgagor.
Section 3.10. Power of Sale; Suits for Enforcement.
If an Event of Default shall occur and be continuing, Mortgagee,
with or without entry, in its discretion, may:
(a) sell, subject to any mandatory requirements of applicable law,
the Trust Estate as an entirety, or in such parcels, as Mortgagee may determine,
to the highest bidder at public auction at such place and at such time (which
sale may be adjourned by Mortgagee from time to time in its discretion by
announcement at the time and place fixed for such sale, without further notice)
and upon such terms as Mortgagee may fix and briefly specify in a notice of sale
to be published as required by law; or
(b) proceed to protect and enforce its rights under this Mortgage
by sale pursuant to judicial proceedings or by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Mortgage or in aid of the execution of
any power granted in this Mortgage or for the foreclosure of this Mortgage or
for the enforcement of any other legal, equitable or other remedy, as Mortgagee
shall deem most effectual to protect and enforce any of the rights of Mortgagee;
the failure to join tenants shall not be asserted as a defense to any
foreclosure or proceeding to enforce the rights of Mortgagee.
Section 3.11. Incidents of Sale.
Upon any sale of any of the Trust Estate, whether made under the
power of sale hereby given or pursuant to judicial proceedings, to the extent
permitted by law:
(a) the principal of and accrued interest on the Senior
Partnership Note, if not previously due, shall at once become and be immediately
due and payable;
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(b) subject to the provisions of Section 3.14 and the receipt of
any required prior approvals of the New Jersey Casino Control Commission,
Mortgagee may bid for and purchase the property offered for sale, and upon
compliance with the terms of sale may hold, retain, possess and dispose of such
property, without further accountability, and may, in paying the purchase money
therefor, deliver the Senior Partnership Note or claims for interest thereon in
lieu of cash to the amount which shall, upon distribution of the net proceeds of
such sale, be payable thereon, and the Senior Partnership Note, in case the
amounts so payable thereon shall be less than the amount due thereon, shall be
returned to Mortgagee after being appropriately stamped to show partial payment;
(c) Mortgagee may make and deliver to the purchaser or purchasers
a good and sufficient deed, bill of sale and instrument of assignment and
transfer of the property sold;
(d) Mortgagee is hereby irrevocably appointed the true and lawful
attorney of Mortgagor, in its name and stead, to make all necessary deeds, bills
of sale and instruments of assignment and transfer of the property thus sold;
and for that purpose it may execute all necessary deeds, bills of sale and
instruments of assignment and transfer, and may substitute one or more persons,
firms or corporations with like power, Mortgagor hereby ratifying and confirming
all that its said attorney or such substitute or substitutes shall lawfully do
by virtue hereof; but if so requested by Mortgagee or by any purchaser,
Mortgagor shall ratify and confirm any such sale or transfer by executing and
delivering to Mortgagee or to such purchaser or purchasers all proper deeds,
bills of sale, instruments of assignment and transfer and releases as may be
designated in any such request;
(e) all right, title, interest, claim and demand whatsoever,
either at law or in equity or otherwise, of Mortgagor of, in and to the property
so sold shall be divested and such sale shall be a perpetual bar both at law and
in equity against Mortgagor, its successors and assigns, and against any and all
persons claiming or who may claim the property sold or any part thereof from,
through or under Mortgagor, its successors and assigns; and
(f) the receipt of Mortgagee or of the officer making such sale
shall be a sufficient discharge to the purchaser or purchasers at such sale for
his or their purchase money and such purchaser or purchasers and his or their
assigns or personal representatives shall not, after paying such purchase money
and receiving such receipt, be obliged to see to the application of such
purchase money, or be in anyway answerable for any loss, misapplication or
non-application thereof.
Section 3.12. Receiver.
Upon the occurrence of an Event of Default and commencement of
judicial proceedings by Mortgagee to enforce any right under this Mortgage,
Mortgagee shall be entitled, as against Mortgagor, without notice or demand and
without regard to the adequacy of the security for the Senior Partnership Note
or the solvency of Mortgagor, to the appointment of a receiver of
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the Trust Estate, and of the rents, issues, profits, revenues and other income
thereof; provided, however, that Mortgagee's rights under this Section 3.12
shall be subject to the provisions of the New Jersey Casino Control Act and
Section 3.14 hereof.
Section 3.13. Suits to Protect the Trust Estate.
Mortgagor hereby acknowledges the right of Mortgagee, in the name
and on behalf of Mortgagor, (a) to appear in and defend any action or proceeding
brought with respect to the Trust Estate or any part thereof and (b) upon 5
days' prior notice to Mortgagor (or such shorter period or without notice if
deemed necessary and appropriate by Mortgagee), to institute and to maintain
such proceedings as Mortgagee may deem necessary and appropriate, but in the
case of (a) and (b) only to prevent any impairment of security or any impairment
of the Trust Estate by any acts which may be unlawful or in violation of this
Mortgage and to protect Mortgagee's interests in the Trust Estate and in the
rents, issues, profits, revenues and other income arising therefrom, including
the right to institute and maintain proceedings to restrain the enforcement of
or compliance with any governmental enactment, rule or order that may be
unconstitutional or otherwise invalid, if the enforcement of or compliance with
such enactment, rule or order would impair the security hereunder or be
materially prejudicial to the interests of Mortgagee.
Section 3.14. Management of the Premises.
Without limiting the generality of any other provision of this
Article Three, following an Event of Default and the taking of possession of the
Trust Estate or any part thereof by Mortgagee and/or the appointment of a
receiver of the Trust Estate or any part thereof, Mortgagee or any such receiver
shall be authorized, in addition to the rights and powers of Mortgagee and such
receiver set forth elsewhere in this Mortgage, to take any action permitted
under Section 5.17 of the Senior Note Indenture.
ARTICLE FOUR
CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE
Section 4.1. Consolidation, Merger, Conveyance or Transfer only on Certain
Terms.
Mortgagor shall comply with all provisions applicable to Mortgagor
in Article Eight of the Senior Note Indenture.
Section 4.2. Successor Entity Substituted.
Upon any consolidation or merger, or any sale, assignment,
conveyance, transfer or
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disposition of the Trust Estate or any portion thereof in accordance with
Section 8.1 of the Senior Note Indenture (other than a lease), the successor
Person formed by such consolidation or into which Mortgagor is merged or the
successor Person to which such sale, assignment, conveyance, transfer or
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of Mortgagor under this Mortgage with the same effect as
if such successor had been named as Mortgagor herein; and thereafter, except in
the case of a lease, the Person named as "Mortgagor" in the first paragraph of
this instrument or any successor Person which shall theretofore have become such
in the manner prescribed in this Article shall be discharged from all
obligations and covenants under this Mortgage.
ARTICLE FIVE V.
COVENANTS AND REPRESENTATIONS OF MORTGAGOR
Section 5.1. Payment of Principal, Premium and Interest.
Mortgagor shall duly and punctually pay the principal of (and
premium, if any) and interest on the Senior Partnership Note in accordance with
the terms of the Senior Partnership Note and this Mortgage.
Section 5.2. F,F&E Financing Agreements.
Mortgagor shall comply with all of the terms and conditions set
forth in any F,F&E Financing Agreements before the expiration of any applicable
notice and cure periods contained in the F,F&E Financing Agreements.
Section 5.3. Limitations on Liens and Transfers.
(a) Mortgagor shall not create, incur, suffer or permit to be
created or incurred or to exist any mortgage, lien, charge or encumbrance on or
pledge of any of the Trust Estate, other than (i) Permitted Encumbrances, (ii) a
notice of intention filed by a mechanic, materialman or laborer under the New
Jersey mechanic's lien law, and (iii) a building contract filed by a contractor
or subcontractor under the New Jersey mechanic's lien law. Without limiting the
generality of the foregoing sentence but notwithstanding the provisions of the
foregoing sentence, Mortgagor shall not be deemed to have breached the
provisions of the foregoing sentence by virtue of the existence of a lien for
Impositions or mechanics' liens so long as Mortgagor is in good faith contesting
the validity of the same in accordance with the provisions of Section 5.8.
(b) The lien of this Senior Note Mortgage on the date hereof shall
be superior, and not subordinate to the lien of any Permitted Encumbrances
(except for items 1, 2, 3, 4 and 11 contained in the definition of Permitted
Encumbrances and any other Working Capital Facility
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Mortgage) to the extent that each thereof encumbers Mortgagor's interest in the
Trust Estate or any part thereof. Mortgagee shall from time to time after
receipt of a request of Mortgagee or the Trustee obtain instruments in form and
substance reasonably satisfactory to Mortgagee or the Trustee, as the case may
be, confirming the senior lien priority of this Senior Note Mortgage over the
lien of any such Permitted Encumbrances.
(c) Except as otherwise expressly permitted under this Mortgage
and the Senior Note Indenture (including, without limitation, Article Eight of
the Senior Note Indenture), Mortgagor shall not sell, assign, lease or otherwise
transfer all or any portion of the Trust Estate or any interest therein.
Notwithstanding the foregoing, Mortgagor shall have the right, at any time and
from time to time, unless an Event of Default shall have occurred and be
continuing, without any release from or consent by Mortgagee, to grant interests
in the Owned Land in the nature of rights-of-way or easements, or other rights
or privileges in the nature of easements; provided, (i) that none of the same
will reduce or impair, in any material respect, (A) the value or usefulness of
the Trust Estate or any part thereof or (B) the normal operation of the Casino
Hotel in accordance with all Legal Requirements and all Permits, (ii) Mortgagor
has delivered to Mortgagee a Mortgagor's Certificate, dated not earlier than 10
days prior to the date of each such grant, certifying that (A) no Event of
Default has occurred and is continuing and (B) the conditions set forth in this
Section 5.3(c) for such grant have been fulfilled and (iii) Mortgagor has
delivered to Mortgagee a duplicate original of the instrument, if any, pursuant
to which such grant is to be made, and such other instruments, certificates and
opinions as Mortgagee may reasonably request. The foregoing provisions of this
Section 5.3(c) shall be self-operative and no further instrument shall be
required to evidence the consent of Mortgagee to the grant or other conveyance
of such rights-of-way or easements. Mortgagee shall, however, from time to time,
after receipt of a Mortgagor's Request therefor (accompanied by a Mortgagor's
Certificate stating that said conditions have been satisfied) execute
instruments in form and substance reasonably satisfactory to Mortgagee
confirming the permissibility of such grant or other conveyance.
Section 5.4. Environmental.
Without limiting the generality of any other provision of this
Mortgage, Mortgagor covenants, represents and warrants to Mortgagee as follows:
(a) Mortgagor shall comply with any and all federal, state and local
environmental legislation, rules, and regulations in effect as of the date of
this Mortgage and subsequent thereto, including, without limitation, the Spill
Compensation and Control Act (N.J.S.A. 58:10-23.11 et seq.) (the "Spill Act");
the Industrial Site Recovery Act (N.J.S.A. 13:1K-6 et seq.("IRSA"); the Solid
Waste Management Act (N.J.S.A. 13:E-1 et seq.) the Resource, Conservation and
Recovery Act (42 U.S.C. Section 6901 et seq.) ("RCRA"); the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 9601
et seq.) ("CERCLA") and such other environmental legislation, rules and
regulations, as are in or may come into effect and apply to (i) Mortgagor and/or
Mortgagee with respect to the
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Premises or (ii) the transactions contemplated hereby, and as to any occupants
or users of the collateral, whether as lessees, tenants, licensees or otherwise,
Mortgagor shall use its best efforts to cause same to comply with said
legislation, rules and regulations. Mortgagor agrees to pay all costs required
in connection with compliance with the foregoing legislation, rules and
regulations.
(b) Mortgagor has not used in the past, nor shall Mortgagor use in
the future, the Premises for the purpose of refining, producing, storing,
handling, transferring, processing or transporting "Hazardous Substances", as
such term is defined in IRSA, the Spill Act, CERCLA or the regulations relating
thereto, except that Mortgagor and its subsidiaries have used, and Mortgagor may
continue in the future to use, substances in the operation and maintenance of
the Premises, including, without limitation, heating oil, gasoline and cleaning
chemicals which could be considered as "Hazardous Substances" under the
preceding definition.
(c) To the best of Mortgagor's knowledge, after due inquiry and
investigation, none of the real property owned, leased and/or occupied by
Mortgagor and located in the State of New Jersey, including, without limitation,
the Premises, has been or is now being used as a "Major Facility" as such term
is defined in N.J.S.A.58:10-23.llb(l). Mortgagor will not use the Premises in
the future as a "Major Facility".
(d) To the best of Mortgagor's knowledge, after due inquiry and
investigation, no lien has been attached to any revenues or any real or personal
property owned by Mortgagor or the Premises, as a result of the Chief Executive
of the New Jersey Spill Compensation Fund expending monies from said fund to pay
for "Cleanup Costs", as such term is defined in N.J.S.A. 58:10-23.11b(d),
arising from an intentional or unintentional action or omission of Mortgagor or
any previous owner and/or operator of such real property.
(e) There is no asbestos or asbestos containing material on the
Premises. To the best of Mortgagor's knowledge, there are no underground storage
tanks located at the Premises, other than those tanks previously disclosed to
Mortgagee and which are maintained in accordance with all material Legal
Requirements. Mortgagor has not installed or placed, or permitted to be
installed or placed, any underground storage tanks at or on the Premises, other
than those tanks previously disclosed to Mortgagee and which are maintained in
accordance with all material Legal Requirements. Underground storage tanks shall
have the definition as set forth in N.J.S.A. 58:10A-22(p).
(f) Mortgagor has not received a summons, citation, directive,
letter, other written communication, or, to the best of its knowledge, any oral
communication, from the New Jersey Department of Environmental Protection and
Energy or from any other person, firm or corporation concerning any intentional
or unintentional action or omission on Mortgagor's part resulting in the
releasing, spilling, leaking, pumping, pouring, emitting, emptying or dumping of
"Hazardous Substances", as such term is defined in N.J.S.A. 58:10-23.11b(k),
into the
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waters or onto the lands of the State of New Jersey, or into the waters outside
the jurisdiction of the State of New Jersey, in either case resulting in damage
to the lands, waters, fish, shellfish, wildlife, biota, air and other resources
owned, managed. held in trust or otherwise controlled by the State of New
Jersey.
(g) In connection with any purchase of the Premises or any business
or assets located thereon or any "closing, terminating or transferring
operations" of any "industrial establishment", as that term is defined in ISRA,
occurring on or after December 31, 1983, Mortgagor required that the owner and
or operator of the industrial establishment comply with the provisions of ECRA
and the owner and or operator did comply therewith.
(h) Upon the occurrence of an Event (as hereinafter defined),
Mortgagee shall have the right to have its consultants perform a comprehensive
environmental audit of the Premises. Such audit shall be conducted by an
environmental consultant chosen by Mortgagee and may include a visual survey, a
record review, an area reconnaissance assessing the presence of hazardous or
toxic waste or substances, PCBs or storage tanks at the Premises, an asbestos
survey of the Premises, which may include random sampling of the improvements
and air quality testing, and such further site assessments as Mortgagee may
reasonably require due to the results obtained from the foregoing. Mortgagor
grants Mortgagee, its agents, consultants and contractors the right to enter the
Premises for the purposes of performing such studies and the cost of such
studies shall be due and payable by Mortgagor to Mortgagee upon demand and shall
be secured by the lien of this Mortgage. Mortgagee shall direct the
environmental consultant to use its best efforts not to hinder Mortgagor's or
any tenant's operations when conducting such audit, sampling or inspections. For
purposes of this paragraph, the term "Event" shall mean (i) the occurrence of
any Event of Default, (ii) the issuance of any summons, citation, directive or
similar written notice from the New Jersey Department of Environmental
Protection and Energy or from any other local, state or federal entity or from
any other person, firm or corporation concerning any alleged material violation
of any and all federal, state and local environmental legislation, rules and
regulations in effect as of the date of this Mortgage and subsequent thereto or
(iii) the initiation of any legal action, suits or other legal or administrative
proceedings relating to or in connection with any alleged violation of any and
all federal, state and local environmental legislation, rules and regulations in
effect as of the date of this Mortgage and subsequent thereto.
(i) If a lien shall be filed against the Premises by the New Jersey
Department of Environmental Protection and Energy, pursuant to and in accordance
with the provisions of N.J.S.A. 58:10-23.11f(f), as a result of the Chief
Executive of the New Jersey Spill Compensation Fund having expended monies from
said fund to pay for "Damages", as such term is defined in N.J.S.A.
58:10-23.11g, and/or "Cleanup and Removal-Costs", as such term is defined in
N.J.S.A. 58:10-23(b), arising from an intentional or unintentional action or
omission of Mortgagor resulting in the releasing, spilling, pumping, pouring,
emitting, emptying or dumping of "Hazardous Substances", as such term is defined
in N.J.S.A. 58:10-23.11(b)k into waters of the State of New Jersey or onto lands
from which it might flow
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or drain into said waters, then, unless there is a good faith basis for
contesting such lien and Mortgagor is so contesting such lien in accordance with
Section 5.8, Mortgagor shall, within 30 days from the date that Mortgagor is
given notice that the lien has been placed against the Premises or within such
shorter period of time if the State of New Jersey has commenced steps to cause
the Premises to be sold pursuant to the lien, either (i) pay the claim and
remove the lien from the Premises, or (ii) furnish (A) a bond satisfactory to a
title company selected by Mortgagee (the "Title Insurer") in the amount of the
claim out of which the lien arises, (B) to the Trustee, a cash deposit (which
may be disbursed by the Trustee in its sole discretion) in the amount of the
claim out of which the lien arises, or (C) other security reasonably
satisfactory to Mortgagee in an amount sufficient to discharge the claim out of
which the lien arises.
(j) Mortgagor shall use its best efforts to cause compliance by all
lessees with all applicable Legal Requirements relating to environmental
protection.
(k) Mortgagor shall promptly provide Mortgagee with copies of all
notices received by or prepared by Mortgagor in connection with ISRA, CERCLA,
the Spill Act, RCRA or any other environmental law, rule or regulation relating
to the Premises. For purposes of this paragraph, the term "notice" shall mean
any summons, citation, directive, order, claim, pleading, letter, application,
filing, report, findings, declarations or other materials pertinent to
compliance of the Trust Estate and Mortgagor with such environmental laws, rules
or regulations.
(l) If this Mortgage is foreclosed, Mortgagor shall deliver the
Premises in compliance with all applicable federal, state and local
environmental laws, ordinances, rules and regulations, including, without
limitation, ISRA.
(m) Without limiting the generality of Section 5.19, Mortgagor
agrees to defend, indemnify and save Mortgagee harmless from and against any
loss or liability, cost or expense (including, without limitation, reasonable
attorneys' fees, consultants' fees, disbursements and court costs) arising out
of, or incurred in connection with, Mortgagor's misrepresentation, or failure
promptly (but in no event to exceed the time period permitted by law) to comply
with and perform its obligations, under this Section 5.4. The provisions of this
subsection (m) shall survive any transfer of the Premises, including a transfer
after a foreclosure of this Mortgage.
Section 5.5. Warranty of Leasehold Estate and Title.
Mortgagor represents and warrants that as of the date hereof:
(a) Mortgagor is duly authorized under the laws of the State of New
Jersey and all other applicable laws to execute and deliver the Mortgage
Documents, and all Partnership action on Mortgagor's part necessary for the
valid execution and delivery of the Mortgage Documents has been duly and
effectively taken;
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(b) Mortgagor is the lawful owner and is lawfully seized and
possessed of the Owned Land and all buildings and improvements thereon, free and
clear of all liens, charges or encumbrances, other than the Mortgages, the
Mortgage Documents and the Existing Encumbrances;
(c) Mortgagor is the holder of and has good and marketable title to
the leasehold interests and leasehold estates under all existing Facility
Leases, subject to no lien, encumbrance or charge other than the Mortgages,
Mortgage Documents and the Existing Encumbrances;
(d)(i) each existing Facility Lease is a valid and subsisting demise
of the respective Leased Land for the term therein set forth, (ii) there are no
defaults under any Facility Lease by any lessor or the lessee as to which
written notice has been given to or by the lessee, (iii) Mortgagor has delivered
to Mortgagee and the Trustee a true and correct copy of each existing Facility
Lease, and all modifications, amendments and supplements thereto, and (iv) each
existing Facility Lease is in full force and effect and has not been modified,
amended or supplemented, except as described on Schedule 3;
(e) Mortgagor has good title to the Operating Assets, subject to no
lien, encumbrance or charge, other than the Mortgage Documents and the Existing
Encumbrances;
(f) Mortgagor has good and lawful right and authority to execute
this Mortgage and to grant, bargain, sell, alien, convey, assign, transfer,
hypothecate, pledge, mortgage and confirm the Trust Estate as provided herein
(including, without limitation, with respect to the Operating Assets and
Facility Leases), without the consent of any third party, other than
governmental authorities and other secured Persons but any applicable or
necessary consent or approval of any such governmental authority and other such
Persons has been given or waived in accordance with applicable law at or prior
to the execution and delivery of this Mortgage, and this Mortgage constitutes a
valid first mortgage lien and deed of trust and first priority security interest
in the Trust Estate, subject only to the Existing Encumbrances and pari passu
liens of the Senior Guarantee Mortgage, the TCHI Note Guarantee Mortgage and the
Senior Partnership Upstream Note Mortgage;
(g)(i) all amounts due under the Mortgage Documents and the
instruments thereby have been paid to the extent they were due and payable to
the date hereof, and (ii) there is no existing default under said Mortgage
Documents or instruments, or in the performance of any of the terms, covenants,
conditions or warranties therein on the part of Mortgagor to be performed and
observed thereunder as to which written notice has been given to Mortgagor; and
(h) Mortgagor hereby does and shall forever warrant and defend (a)
the title to the Trust Estate (including, without limitation, Mortgagor's
leasehold estate under, and the lessee's interests in, each existing Facility
Lease) (subject to items 1 and 3 listed on Schedule
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3) and (b) the pari passu liens of the Mortgages thereon (subject to items 1 and
3 listed on Schedule 3), against the claims and demands of all persons
whomsoever, at Mortgagor's sole cost and expense.
Section 5.6. After-Acquired Property; Further Assurances: Recording.
All property, real, personal or mixed or any interest therein (other
than Excepted Property), of every kind and description and wheresoever situate,
which may be hereafter acquired by Mortgagor (including, without limitation, fee
title to any Leased Land) shall immediately upon the acquisition thereof by
Mortgagor, and without any further mortgage, conveyance or assignment, become
subject to the lien of this Mortgage as fully as though now owned by Mortgagor
and covered by the Granting Clauses. Nevertheless, Mortgagor shall do, execute,
acknowledge and deliver all and every such further acts, conveyances, mortgages,
financing statements and assurances as Mortgagee shall require for accomplishing
the express purposes of this Senior Note Mortgage.
Mortgagor shall, as provided in Section 5.12, from time to time
subject to the lien of this Senior Note Mortgage its right, title and interest
under all Leases.
Mortgagor shall use reasonable efforts to insure that all Operating
Assets (other than Excepted Property) or any interest therein hereafter acquired
by Mortgagor shall be assignable to Mortgagee, and to the extent such assignment
to Mortgagee requires the consent of any governmental authority or any other
Person, Mortgagor shall use reasonable efforts to obtain such consent or a
waiver thereof.
Mortgagor shall cause this instrument and all other instruments of
further assurance, including all financing statements and continuation
statements covering security interests in personal property, to be promptly
recorded, registered and filed, and at all times to be kept recorded, registered
and filed, and shall execute and file such financing statements and cause to be
issued and filed such continuation statements, all in such manner and in such
places as may be required by law or as requested by Mortgagee to fully preserve
and protect the rights of Mortgagee as a secured party under the Uniform
Commercial Code to all property comprising the Trust Estate (to the extent a
grant of a security interest therein is governed by the Uniform Commercial Code)
and to perfect, preserve and protect the lien of this Senior Note Mortgage as a
valid direct first mortgage lien of record and a valid first priority security
interest on the Trust Estate, subject only to Permitted Encumbrances.
Mortgagor shall pay all filing or recording fees, and all expenses
incident to the execution and delivery of this Mortgage, any financing statement
or continuation statement with respect to the personal property constituting
part of the Trust Estate, and any instrument of further assurance, and all
federal, state, county and municipal stamp taxes and other taxes, duties,
imposts, assessments and charges arising out of or in connection with the
execution and delivery of the Senior Partnership Note, this Senior Note
Mortgage, any financing statement or
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continuation statement with respect to the personal property constituting part
of the Trust Estate or any instrument of further assurance.
Mortgagor shall furnish to Mortgagee promptly after the acquisition
hereafter by Mortgagor of any fee interest or leasehold interest in real
property having a fair market value exceeding $500,000 (other than Excepted
Property) (a) a mortgagee policy of title insurance on the most recent form of
American Land Title Association standard loan policy, extended coverage, which
policy shall (i) contain all such endorsements and affirmative insurance, to the
extent reasonably applicable, as is contained in the Original Policy and (ii)
evidence that title to such real property is subject to no liens or encumbrances
(other than Permitted Encumbrances) which would (A) render title unmarketable or
(B) violate any other provision of this Senior Note Mortgage or the Senior Note
Indenture, (b) an as-built survey meeting the "Minimum Standard Detail
Requirements for ALTA/ACSM Land Title Surveys", certified within 60 days prior
to the acquisition date by a surveyor licensed in the State of New Jersey using
the same form of certification as that contained in the surveys of the Premises
delivered to the Trustee on the date of this Mortgage and (c) a Mortgagor's
Certificate certifying that the mortgagee policy of title insurance and survey
delivered pursuant to clauses (a) and (b) comply, respectively, with the
provisions of such clauses (a) and (b). Upon delivery of all of the items
required under this paragraph, any liens or encumbrances on such real property
shall constitute Permitted Encumbrances hereunder.
Section 5.7. Payment of Taxes and Certain Claims; Maintenance of Properties;
Compliance with Legal Requirement and Insurance Requirements.
Mortgagor shall:
(a) subject to the provisions of Section 5.8, pay or cause to be
paid before the date on which any fine, penalty, interest or cost may be added
for nonpayment (but no later than when the same are payable by Mortgagor
pursuant to any Superior Instrument Requirement), all taxes (including, without
limitation, real estate taxes, personal or other property taxes and all sales,
value added, use and similar taxes), assessments (including, without limitation,
all assessments for public improvements or benefits, whether or not commenced or
completed prior to the date hereof and whether or not to be completed prior to
the satisfaction of this Mortgage), water, sewer or other rents, rates and
charges, excises, levies, license fees, permit fees, inspection fees and other
authorization fees and other charges, in each case whether general or special,
ordinary or extraordinary, foreseen or unforeseen, of every character
(including, without limitation, all interest, additions to tax and penalties
thereon), that may be assessed, levied, confirmed or imposed on or in respect of
or be a lien upon (i) the Trust Estate (including, without limitation, the
Leased Land) or any part thereof or any rent therefrom or any estate right or
interest therein, or (h) any acquisition, occupancy, use, leasing, or possession
of or activity conducted on the real property or any part thereof included in
the Trust Estate or any gross receipts thereof or of the rent therefrom (all of
the foregoing being referred to collectively as "Impositions"). Notwithstanding
the foregoing or any other
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provision of this Mortgage, Mortgagor shall not be required to pay any income,
profits or revenue tax upon the income of Mortgagee, the Trustee or the Holders
nor any franchise, excise, corporate, estate, inheritance, succession, capital
levy or transfer tax of Mortgagee, the Trustee or the Holders nor any interest,
additions to tax or penalties in respect thereof, unless such tax is imposed,
levied or assessed in substitution for any Imposition that Mortgagor is required
to pay pursuant to this Section 5.7. Mortgagor shall deliver to Mortgagee, at
Mortgagee's request, official receipts or other proof evidencing payments of any
Impositions in accordance with the requirements of this Section 5.7. Mortgagor
shall not be entitled to any credit for taxes or assessments paid against the
Senior Partnership Note;
(b) except for such obsolete property as Mortgagor may dispose of or
replace pursuant to Section 2.2, maintain and keep all of Mortgagor's properties
used or useful in the conduct of Mortgagor's business, including, without
limitation, the Casino Hotel and all Tangible Personal Property, in such good
repair, working order and condition, except for reasonable wear and use, and
make or cause to be made all such needful and proper repairs, renewals and
replacements thereto consistent with the standards of first-class casino and
hotel complexes in Atlantic City, New Jersey;
(c) occupy and continuously operate the Casino Hotel and keep the
Casino Hotel supplied with Tangible Personal Property, all in a manner
consistent with the standards of first-class casino and hotel complexes in
Atlantic City, New Jersey;
(d) subject to the provisions of Section 5.8, (i) comply with all
Legal Requirements and Insurance Requirements, whether or not compliance
therewith shall require structural changes in the buildings and improvements
included in the Trust Estate or interfere with the use and enjoyment of the
Trust Estate or any part thereof, (ii) procure, maintain and comply with all
Permits required for (1) the use of the Casino as a gaming and gambling
facility, (2) the on-premises consumption of alcoholic beverages at the Casino
Hotel and (3) any other use of the Trust Estate or any part thereof then being
made, and for the proper erection, installation, operation and maintenance of
the improvements or any part thereof, (iii) comply with all obligations of
Mortgagor under, and keep in full force and effect, all easements which in any
respect inure to the benefit of, or otherwise affect, the Trust Estate or any
part thereof, if the failure to comply with the same would impair Mortgagee's
security hereunder, and (iv) without limiting the generality of clause (iii),
comply with any instruments of record at the time in force affecting the Trust
Estate or any part thereof, if the failure to comply with the same would impair
Mortgagee's security hereunder. Without limiting the generality of the
foregoing, Mortgagor represents and warrants that at the time of the execution
of this Mortgage, Mortgagor is in compliance with the requirements of clauses
(i), (ii), (iii) and (iv) above; and
(e) in the event of the passage after the date of this Mortgage of
any law of the State of New Jersey, or any other governmental entity, changing
in any way the laws now in force for the taxation of mortgages, or debts secured
thereby, for federal, state or local purposes, or
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the manner of the operation of any such taxes, so as to affect the interest of
Mortgagee, pay the full amount of such new or additional taxes.
Section 5.8. Permitted Contests.
Notwithstanding anything in this Senior Note Mortgage to the
contrary, Mortgagor, at Mortgagor's expense, may contest (after prior notice to
Mortgagee) by appropriate legal proceedings conducted in good faith and with due
diligence, the amount or validity or application, in whole or in part, of any
Imposition or lien therefor or any Legal Requirement or Insurance Requirement or
the application of any instrument of record (including, without limitation, any
Superior Instrument Requirement) affecting the Trust Estate or any part thereof
or any claims of holders of F,F&E Financing Agreements, mechanics, materialmen,
suppliers, or vendors or lien therefor, and may withhold payment of the same
pending such proceedings if permitted by law, or make payment under protest, or
defer compliance with any such Legal Requirement, any such Insurance Requirement
or the terms of any such instrument, and the same shall not be a Default
hereunder; provided, that (a) in the case of any Impositions or lien therefor or
any claims of mechanics, materialmen, suppliers or vendors or lien therefor,
such proceedings shall suspend the collection thereof from each of Mortgagor,
Mortgagee, the Trustee, the Holders and the Trust Estate, (b) neither the Trust
Estate nor any interest therein would be in any significant danger of being
sold, forfeited, or lost, (c) such action will not result in the termination of
any Facility Lease, (d) in the case of a Legal Requirement, neither the Holders
nor Mortgagee shall be in any significant danger of any civil liability or any
danger of any criminal liability, and the failure of Mortgagor to comply with
such Legal Requirement shall not affect the continuance in good standing of any
Permit or result in the suspension, termination, non-renewal or material adverse
modification of any Permit, and (e) in the case of an Insurance Requirement, the
failure of Mortgagor to comply therewith shall not affect the validity of any
insurance required to be maintained by Mortgagor hereunder.
Section 5.9. Mechanics' and Other Liens.
Mortgagor shall cause to be removed, either by payment, or bonding
or otherwise, all claims and demands of mechanics, materialmen, laborers, and
others which, if unpaid, might result in, or permit the creation of, a lien on
the Premises and/or Trust Estate or any part thereof, or on the revenues, rents,
issues, income and profits arising therefrom and in general shall do or cause to
be done everything necessary so that the lien hereof shall be fully preserved,
at the cost of Mortgagor, without expense to Mortgagee.
Section 5.10. To Insure.
(a) Mortgagor, at Mortgagor's expense, shall maintain with Insurers:
(i) insurance with respect to Mortgagor's insurable properties
constituting a part of the Trust Estate against loss or damage by fire,
lightning, and other risks from
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time to time included under "all-risk" policies and against loss or damage
by sprinkler leakage, water damage, collapse, malicious mischief and
explosion in respect of any steam and pressure boilers and similar
apparatus located on such insurable properties, in amounts at all times
sufficient to prevent Mortgagor from becoming a coinsurer within the terms
of the applicable policies, but in any event such insurance shall be
maintained in not less than the greatest of the following (the "Insurance
Amount"): (A) 100% of the then Full Insurable Value of such insurable
properties, determined from time to time (but not less frequently than
once in any 36 calendar months), by an Appraiser or Insurer, (B) the then
Outstanding Amount of Mortgage Debt, including the Senior Partnership
Note, or (C) the amount required to be maintained pursuant to the Superior
Instrument Requirements;
(ii) war risk insurance as and when such insurance is
obtainable from the United States of America or any agency thereof as
promptly as reasonably practicable after the same becomes so obtainable,
in an amount not less than the Insurance Amount, or, if such insurance
cannot be obtained in an amount not less than the Insurance Amount, in
such lesser amount as may then be so obtainable;
(iii) comprehensive general liability insurance, including,
without limitation, blanket contractual liability coverage, broad form
property damage, independent contractor's coverage and personal injury
coverage against any and all claims arising out of or connected with the
possession, use, leasing, operation or condition of such insurable
properties, in an amount not less than $100,000,000 combined single limit
coverage for personal injury and property damage with respect to any one
occurrence, which may be under an umbrella policy. Anything contained in
this clause (iii) to the contrary notwithstanding, the Superior Instrument
Requirements with respect to the kinds and amount of insurance described
in this clause (iii) shall be satisfied by Mortgagor;
(iv) workers' compensation insurance to the extent required by
law;
(v) business interruption insurance covering not less than 6
months of loss, provided that, at any time that Mortgagor is renewing any
policy for such insurance or taking out any new or replacement policy for
such insurance covering a period of less than 12 months, Mortgagor shall
deliver to Mortgagee an Officers' Certificate certifying that the period
of coverage to be maintained by Mortgagor under such policy is the maximum
that can be maintained at rates determined by Mortgagor to be reasonable
for such coverage;
(vi) to the extent available, flood insurance in an amount not
less than the Insurance Amount, or, if such insurance cannot be obtained
in an amount not less than the Insurance Amount, such lesser amount as may
then be so obtainable but in no event less than $100,000,000; and
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(vii) such other insurance with respect to such insurable
properties against loss or damage of the kinds (A) from time to time
customarily insured against by persons owning or using first-class casino
and hotel complexes in Atlantic City, New Jersey and (B) required to be
maintained pursuant to any Superior Instrument Requirements.
Notwithstanding the foregoing, to the extent not violative of any
Superior Instrument Requirements, (A) Mortgagor may maintain a deductible with
respect to the insurance policies described in clauses (i), (ii), (vi) and (vii)
in an amount not to exceed $250,000, (B) Mortgagor may maintain a deductible
with respect to the insurance policies described in clause (iii) in an amount
not to exceed $500,000, and (C) Mortgagor may maintain a deductible with respect
to the insurance policies described in clause (v) in an amount not to exceed
$1,000,000.
(b) (i) Each policy of insurance maintained by Mortgagor pursuant
to Section 5.10(a) shall, (A) except in the case of workers' compensation
insurance, name Mortgagor as an insured and shall name as additional insureds
(1) Mortgagee and (2) to the extent required by the Superior Instrument
Requirements, the lessors under any Facility Leases, (B) provide that all
insurance proceeds for losses, except in the case of comprehensive general
liability insurance and workers' compensation insurance or as otherwise provided
in Subsections (d), (e) and (f) of this Section 5.10, be payable solely to
Mortgagee, (C) include effective waivers (whether under the terms of any such
policy or otherwise) by the insurer of all claims for insurance premiums against
all loss payees and named insureds (other than Mortgagor) and all rights of
subrogation against any named insured, (D) except in the case of comprehensive
general liability and workers' compensation insurance, provide that any losses
shall be payable notwithstanding (1) any act, failure to act, negligence of, or
violation or breach of warranties, declarations or conditions contained in such
policy by Mortgagor or Mortgagee or any other named insured or loss payee
(including, without limitation, the lessors under the Facility Leases, with
respect to any Leased Facilities, (2) the occupation or use of the insurable
properties for purposes more hazardous than permitted by the terms of the
policy, (3) any foreclosure or other proceeding or notice of sale relating to
the insurable properties or (4) any change in the title to or ownership or
possession of the insurable properties, (E) contain a non-contributory mortgagee
clause in favor of Mortgagee, and (F) provide that if all or any part of such
policy is canceled, terminated or expires, the insurer will forthwith give
notice thereof to each named insured and loss payee and that no cancellation,
non-renewal, reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by each named insured and loss
payee of written notice thereof.
(ii) Mortgagor may effect the insurance required under this
Section 5.10 under blanket and/or umbrella policies covering properties
owned or leased by Affiliates of Mortgagor; provided, that (A) such
policies otherwise comply with this mortgage, (B) except with respect to
flood insurance and earthquake insurance, provide that the amount of
coverage afforded thereunder with respect to the Trust Estate shall not be
reduced by claims thereunder against such other properties and (C) in the
case of flood insurance provide that the amount of coverage afforded
thereunder with respect to the Trust Estate shall not be reduced below
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$100,000,000 by reason of claims thereunder against such other properties.
(c) Mortgagor shall deliver to Mortgagee duplicate originals of
all insurance policies that Mortgagor is required to maintain pursuant to this
Section 5.10. Mortgagee shall not be responsible for effecting or renewing any
insurance or for the responsibility or solvency of the insurers.
(d) Mortgagor shall give written notice to Mortgagee immediately
upon obtaining knowledge of any Casualty which (i) results in damage, loss or
destruction in an amount in excess of $5,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property or (ii)
pursuant to any Superior Instrument Requirement would require the deposit of
insurance proceeds with the Insurance Trustee, or action or proceeding with
respect thereto. Within 30 days after any Casualty which results in any damage,
loss or destruction in an amount in excess of $10,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property, Mortgagor
shall deliver to Mortgagee a certificate of an Architect stating whether, in
such Architect's opinion, applicable Legal Requirements permit the Restoration
of said buildings and improvements for the same uses and to the same size and
quality in all material respects, as existed immediately prior to the Casualty
(and if said certificate states that Legal Requirements do not permit such
Restoration, said certificate shall describe the manner closest approximating
such criteria to which the buildings and improvements could be so restored and
shall be accompanied by a Certificate Of Appraised Value dated not more than 10
days prior to delivery setting forth the Appraised Value immediately prior to
the Casualty and the estimated Appraised Value immediately after the
Restoration). If Mortgagor is required to deliver such Certificates of Appraised
Value and if based on such Certificates of Appraised Value immediately after
Restoration, (i) the aggregate Outstanding Amount of Indebtedness of the
Mortgagor, the Company or TCHI immediately after such Restoration shall exceed
the greater of (A) 80% of the Appraised Value immediately after such Restoration
or (B) the quotient of the Outstanding Amount of Indebtedness of the Mortgagor,
the Company or TCHI immediately prior to such Casualty divided by the Appraised
Value immediately prior to the Casualty multiplied by the Appraised Value
immediately after such Restoration, or (ii) applicable Legal Requirements do not
permit the Restoration of the Casino Hotel for use as a casino and hotel
complex, then, in either of such events, the proceeds of any insurance shall not
be applied to Restoration but shall instead be paid and delivered to Mortgagee
to the extent of the then Outstanding Amount of the Senior Partnership Note and
any other interest or other sums due hereunder or thereunder to be applied to
the satisfaction of this Mortgage to the extent proceeds are available for such
purpose and provided that no additional sums are due to the Trustee or the
Holders under the Senior Notes, the Senior Note Indenture, the Senior Guarantee,
the TCHI Notes, the TCHI Note Indenture, the TCHI Guarantee, the Mortgage Notes
or the Mortgage Note Indenture, the balance of any net insurance proceeds shall
be paid to Mortgagor.
(e) Subject to the provisions of Subsection 5.10(d), if a Casualty
occurs, the following shall apply:
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(i) If the cost of Restoration is less than $10,000,000, the
net insurance proceeds shall be paid by Mortgagee to Mortgagor.
(ii) If the cost of Restoration is $10,000,000 or more, the
net insurance proceeds shall be paid by Mortgagee to the Insurance
Trustee.
(iii) Mortgagor shall commence with reasonable promptness
under the circumstances and thereafter with due diligence proceed to
perform and complete in a good and workmanlike manner the restoration,
repair, replacement or rebuilding of the damage or destruction resulting
from the Casualty (all such restoration, repair, replacement and
rebuilding following a Casualty or a Taking are referred to as
"Restoration") in accordance with the plans and specifications submitted
to the Insurance Trustee, in conformance with all Legal Requirements and
Superior Instrument Requirements, and in accordance with the further
provisions of this Subsection (e), regardless of the extent of any such
Casualty and whether or not net insurance proceeds, if any, shall be
available or, if available, shall be sufficient, for the purpose of the
Restoration. All Restoration work shall be performed in accordance with
the applicable provisions of Section 5.12 and in conformance with all
Superior Instrument Requirements, Legal Requirements and Insurance
Requirements and, prior to commencing any Restoration, Mortgagor shall
obtain all Permits necessary in connection therewith, and shall obtain,
and keep in full force and effect until the completion of such
Restoration, such additional insurance as the Insurance Trustee and
Superior Instrument Requirements may require. The plans and specifications
for the Restoration shall be accompanied by a Mortgagor's Certificate and
an Opinion of Counsel to the effect that upon the completion of the
Restoration pursuant to the plans and specifications, the Premises and all
buildings and improvements thereon will comply with all Superior
Instrument Requirements, Legal Requirements and Insurance Requirements.
(iv) Any insurance proceeds which Mortgagor receives shall be
held by Mortgagor in trust for the purpose of paying the cost of the
Restoration, except as otherwise provided herein.
(v) Any net insurance proceeds that the Insurance Trustee
holds pursuant to this Subsection (e), shall be deposited in an
interest-bearing investment reasonably designated by Mortgagor (to the
extent Mortgagor is permitted to designate such investment under the
Superior Instrument Requirements) (and the interest thereon shall be added
to such proceeds) and shall be paid by the Insurance Trustee to reimburse
Mortgagor for, or to make payment for, the Restoration, after the
Insurance Trustee deducts therefrom the amount of any reasonable costs and
expenses incurred in connection with the performance of its obligations
under this Section 5.10. The Insurance Trustee shall make such payments
not more frequently than once every 30 days upon the written request of
Mortgagor (unless more frequent payments are
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required by Superior Instrument Requirements), by paying to Mortgagor or
the persons named in the certificate described in clause (vi) of this
Subsection (e) the respective amounts stated in such certificate from time
to time as the Restoration progresses, provided Mortgagor has complied
with the requirements of this Subsection (e) and such payment is permitted
by any applicable Superior Instrument Requirements. Mortgagor's request
shall be accompanied by (A) the certificate described in clause (vi) of
this Subsection (e) and (B) a title company or official search, or other
evidence reasonably acceptable to the Insurance Trustee, showing that
there have not been filed with respect to the Premises, any vendor's,
contractor's, mechanic's, laborer's or materialman's statutory or similar
lien which has not been discharged of record (or bonded against or secured
by other security) or any other encumbrance irrespective of its priority
(other than Permitted Encumbrances).
(vi) The certificate required by clause (v) of this Subsection
(e) shall (A) be a Mortgagor's Certificate, countersigned by the Architect
in charge of the Restoration with respect to the matters described in (1)
and (5) below, (B) be dated not more than 10 days prior to such request
and (C) set forth (in addition to any other requirements contained in any
applicable Superior Instrument Requirements) that:
(1) all of the Restoration theretofore performed is in
substantial compliance with the plans and specifications theretofore
submitted to the Insurance Trustee and in compliance with all
Superior Instrument Requirements, Legal Requirements and
Insurance Requirements;
(2) the sum then requested either has been paid by
Mortgagor or is justly due to contractors, subcontractors,
materialmen, engineers, architects or other persons who have
rendered services or furnished or contract to deliver materials for
the Restoration therein specified, and the names and addresses of
such persons, a brief description of such services and materials and
the several amounts so paid or due to each of said persons in
respect thereof;
(3) no part of the amount requested has been or is the
basis in any previous or then pending request for the withdrawal of
net insurance proceeds, and that the sum then requested does not
exceed the value of the services and materials described in the
certificate;
(4) except for the amount, if any, stated pursuant to
subclause (2) of this clause (vi) in such certificate to be due for
services or materials, and except for amounts in dispute and/or
customary retainages, there is no outstanding indebtedness Known to
the person signing such certificate, after due inquiry, which is
then due for labor, wages, materials, supplies or services in
connection with such Restoration; and
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(5) the remaining cost, as estimated by the persons
signing such certificate, of the Restoration in order to complete
the same does not exceed the net insurance proceeds remaining in the
hands of Insurance Trustee after payment of the sum requested in
such certificate or if such estimated cost does exceed such
insurance proceeds such certificate shall state the amount of any
such deficiency. If the certificate states that such deficiency will
exist, Mortgagor shall deliver the amount of such deficiency in cash
or cash equivalent to the Insurance Trustee simultaneously with the
delivery of such certificate, which amount shall be deemed insurance
proceeds for purposes of this Section 5.10(e).
(vii) If net insurance proceeds shall be insufficient to pay
the entire cost of the Restoration, then, after completion of the
Restoration, Mortgagor shall pay the deficiency. If all or any part of the
net insurance proceeds are not used for the Restoration in accordance with
this Subsection (e) (because such proceeds exceed the amount required to
complete the Restoration), then upon completion of the Restoration in
accordance with this Subsection (e), such amount not so used, if held by
the Insurance Trustee, shall be paid to Mortgagor (if permitted by
Superior Instrument Requirements).
(f) Mortgagor shall not take out separate insurance, concurrent in
form or contributing in the event of loss with that required to be maintained
pursuant to this Section 5.10, unless the same is permitted by Superior
Instrument Requirements. Mortgagor shall immediately notify Mortgagee whenever
any such separate insurance is taken out and shall promptly deliver to Mortgagee
a duplicate original of the policy of such insurance, a copy thereof certified
by the insurer or a certificate thereof. Provided that no Event of Default has
occurred and is continuing, all net business interruption insurance proceeds
shall be paid to Mortgagor, to be segregated from the other funds of Mortgagor
and held in trust by Mortgagor for the following purposes and in the following
order of priority: (i) for the payment of Impositions and amounts due under the
Facility Leases, (ii) for debt service under the Senior Partnership Note for the
estimated period of Restoration (for purposes of this Subsection 5.10(f),
interest and principal payments due on any payment date under the Senior
Partnership Note will be deemed to accrue in equal daily installments beginning
the day after the immediately preceding payment date and ending on such payment
date), and (iii) for any other expense incurred in connection with the operation
or business of the Casino Hotel.
(g) Insurance claims by reason of damage or destruction to any
portion of the Trust Estate may be adjusted by Mortgagor, but Mortgagee shall
have the right (but not the obligation) to join Mortgagor in adjusting, and
approving the adjustment of, any such loss except in the event of a loss where
the amount of insurance reasonably anticipated to be received with respect to
such loss is less than $5,000,000, and Mortgagor shall assist Mortgagee in any
such adjustment at the request of Mortgagee. If Mortgagee at its election as
aforesaid joins Mortgagor in any adjustment process, then Mortgagee's approval
of the
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adjustment shall not be unreasonably withheld.
(h) Notwithstanding anything contained herein to the contrary, if
an Event of Default shall have occurred and be continuing, Mortgagee may, at its
option, (A) refrain from paying to Mortgagor or the Insurance Trustee any net
insurance proceeds or (B) instruct the Insurance Trustee to pay to Mortgagee any
insurance proceeds then held by the Insurance Trustee, as the case may be.
Section 5.11. Limitations on Building Demolition, Alterations, Improvements and
New Construction.
Mortgagor shall not authorize, permit or make any demolition,
alteration or improvement of any building, structure or other improvements
included in the Trust Estate or any new construction on any part of the Trust
Estate, except in conformity with and subject to the limitations hereinafter in
this Section 5.11 set forth and set forth in the Senior Note Indenture.
Unless an Event of Default shall have occurred and be continuing,
Mortgagor shall have the right at all times to make or permit such demolition,
alterations, improvements or new construction, structural or otherwise (herein
sometimes called collectively "Alterations" and each, individually, an
"Alteration"), of the Trust Estate, to be made in all cases subject to each of
the following conditions:
(a) No Alteration shall be undertaken or carried out except in
conformity with all Superior Instrument Requirements, Legal Requirements and
Insurance Requirements.
(b) If the estimated cost of any Alteration, together with other
Alterations that constitute a single construction plan or project (whether or
not accomplished in several stages or procedures), exceeds $5,000,000, the
building or buildings, structures or other improvements as so improved or
altered, upon the completion of the work, shall be of a value not less than the
value of such building or buildings, structures or other improvements
immediately prior to the making of such Alteration.
(c) Any Alteration which is structural in nature or involves an
estimated cost of more than $5,000,000 shall be conducted under the supervision
of an Architect, and no such Alteration shall be undertaken until 10 days after
there shall have been filed with Mortgagee detailed plans and specifications and
cost estimates therefor, prepared and approved in writing by such Architect and
accompanied by a certificate of such Architect stating that such plans and
specifications conform to all applicable provisions of this Section 5.11.
(d) No Alteration involving an estimated cost of more than
$5,000,000 shall be undertaken until Mortgagor has furnished to Mortgagee, at
Mortgagor's sole cost and expense, a surety bond or bonds, covering performance,
and labor and material payments with respect
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to the work to be so performed, naming Mortgagee as obligee, issued by a
responsible surety company, authorized to do business in the State of New
Jersey, in a form generally and customarily used by such surety in an amount
equal to the estimated cost of construction of the work covered by the plans and
specifications therefor, guaranteeing the performance and completion of such
construction, substantially in conformity with the said plans and specifications
and within a reasonable time, subject to delays by fire, strikes, lock-out, acts
of God, inability to obtain labor or materials, governmental restrictions, enemy
action, civil commotion or unavoidable Casualty or other similar causes beyond
the control of Mortgagor, free and clear of all liens, claims and liabilities
for the cost of such Alterations. If such surety bond or bonds shall be
unobtainable Mortgagor shall deliver to Mortgagee security by cash, letter of
credit or other guarantee, affording substantially the same protection as would
such bond or bonds.
(e) All work done in connection with any Alterations shall be done
promptly and in good and workmanlike manner. The work in connection with any
Alteration shall be prosecuted with reasonable dispatch, delays due to fire,
strikes, lock-outs, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable Casualty
or similar causes beyond the control of Mortgagor excepted.
(f) If the estimated cost of Alterations exceeds $5,000,000,
Mortgagor shall have delivered to Mortgagee (i) prior to the commencement of
such Alterations, copies of all Permits required for the commencement of such
work together with a certificate of the Architect or an Opinion of Counsel to
the effect that all Permits required for the commencement of such Alterations
have been obtained; and (ii) within a reasonable period of time after the
completion of the Alterations, copies of all Permits required in connection with
the completion thereof, together with either an Opinion of Counsel or a
certificate of the Architect that all such Permits have been so obtained by
Mortgagor and that Mortgagor has complied with all the requirements of this
Section 5.11.
(g) No Alterations of any kind shall be made which shall change
the use or reduce the size or quality of any building, structure or other
improvements in any material respect or which shall change the use of the Casino
Hotel from its use as a gaming and hotel facility.
(h) No Alterations costing in excess of $5,000,000, together with
other Alterations that constitute a single construction plan or project (whether
or not accomplished in several stages or procedures), shall be made if such
Alterations are not expected to be completed at least 120 days prior to the
Stated Maturity of the Senior Partnership Note (except if such Alterations are
required in order to comply with Legal Requirements or Superior Instrument
Requirements).
(i) Mortgagor shall maintain at all times during the performance
of Alterations, in addition to any insurance required to be maintained under
Section 5.11 hereof, appropriate workers' compensation insurance covering all
persons employed for such Alterations to the
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extent required by applicable law, and comprehensive general liability insurance
expressly covering the additional hazards due to such Alterations. Each such
policy of insurance shall comply with the provisions of Section 5.10(b), and
Mortgagor shall comply with Subsections (c), (d), (e), (f), (g) and (h) of
Section 5.10 in connection with all such insurance.
Section 5.12. Leases.
Mortgagor shall not:
(a) lease the Trust Estate substantially as an entirety to any
Person (except in accordance with the provisions of Article Eight of the Senior
Note Indenture), nor shall Mortgagor lease either the Casino Hotel or the Casino
or the Hotel or any parking facilities substantially as an entirety to any
Person;
(b) enter into any Lease, or renew, modify, extend, terminate, or
amend any Lease, except in the ordinary course of business of operating the
Casino Hotel;
(c) receive or collect, or permit the receipt or collection of, any
rental payments under any Lease more than one month in advance of the respective
periods in respect of which they are to accrue, except that, in connection with
the execution and delivery of any Lease or of any amendment to any Lease, rental
payments thereunder may be collected and received in advance in an amount not in
excess of three months' rent and/or a security deposit may be required
thereunder in an amount not exceeding one year's rent;
(d) collaterally assign, transfer or hypothecate (other than to
Mortgagee hereunder or to the holder of the Senior Guarantee Mortgage, the
holder of the TCHI Note Guarantee Mortgage or the holder of the Senior
Partnership Upstream Note Mortgage, but in each case only with respect to the
property secured by such mortgage) (i) any rental payment under any Lease
whether then due or to accrue in the future, (ii) the interest of Mortgagor as
landlord under any Lease or (iii) the rents, issues or profits of the Trust
Estate;
(e) after the date hereof, enter into any Lease, or renew any Lease,
unless such Lease contains terms to the effect as follows:
(i) the Lease and the rights of the tenants thereunder shall
be subject and subordinate to the rights of Mortgagee under this Mortgage,
(ii) the Lease may be assigned by the landlord thereunder to
Mortgagee, and
(iii) the rights and remedies of the tenant in respect of any
obligations of the landlord thereunder shall be nonrecourse as to any
assets of the landlord other than its equity in the building in which the
leased premises are located or the proceeds thereof; or
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(f) modify any Lease with respect to the matters described in
clauses (i) through (iii) of paragraph (e).
If Mortgagor enters into a Lease (other than with an Affiliate of
Mortgagor) for a term of not less than 3 years, Mortgagee shall deliver a
non-disturbance and attornment agreement substantially in the form of Schedule 7
hereto, following receipt of a certificate of a leasing broker (who is not an
Affiliate of Mortgagor or the broker involved in such transaction) experienced
with respect to leases of commercial space in the Atlantic City area stating
that the rent under the Lease throughout the term thereof is not less than fair
market rent and the other terms of the Lease are fair and reasonable in the
commercial leasing market. Mortgagor shall, upon demand, reimburse Mortgagee for
any costs and expenses (including reasonable attorneys' fees and disbursements)
incurred by Mortgagee in connection with the preparation, review and delivery of
such non-disturbance and attornment agreements.
Promptly after the execution and delivery hereof, and promptly after
each Lease is executed or becomes effective after the date of the execution and
delivery hereof, Mortgagor shall cause the lessee under each such Lease to be
duly notified in writing (unless the substance and effect of such notice shall
be contained in such Lease) of the subjection of the owner's interest, as
lessor, in and to such Lease to the lien of this Mortgage and of the name and
address of Mortgagee. Each such notice shall state that the lease of such lessee
is a Lease as herein defined. If a new Mortgagee is at any time appointed
hereunder or the address of Mortgagee shall at any time be changed, Mortgagor
shall cause each lessee under each lease to be promptly notified in writing of
the name and address of such new Mortgagee or the new address of Mortgagee.
Mortgagor shall use reasonable efforts (but shall not be obligated to incur any
expenditure other than de minimis amounts) to obtain from each lessee under each
Lease to whom any notice is sent pursuant to this paragraph an acknowledgment of
receipt of such notice, and Mortgagor shall promptly deliver to Mortgagee, upon
request, a copy of each such acknowledgment of receipt which it is able to
obtain. Mortgagee shall not be responsible for securing or causing Mortgagor to
secure any such acknowledgment.
Section 5.13. Compliance Certificates.
Mortgagor shall deliver to Mortgagee, within 120 days after the end
of each fiscal year of Mortgagor, a Mortgagor's Certificate stating that
(a) a review of the activities of Mortgagor during such year and of
performance under this Mortgage has been made under the signer's supervision,
and
(b) to the best of each signer's knowledge, based on such review,
Mortgagor has fulfilled all of Mortgagor's obligations under this Mortgage
throughout such year, or, if there has been a default in the fulfillment of any
such obligation, specifying each Such default known to him and the nature and
status thereof.
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Promptly after Mortgagor may reasonably be deemed to have knowledge
of a default hereunder, Mortgagor shall deliver to Mortgagee a notice specifying
the nature and period of existence thereof and the action Mortgagor is taking
and proposes to take with respect thereto.
Section 5.14. To Keep Books; Inspection by Mortgagee.
Mortgagor will keep proper books of record and account, in which
full and correct entries shall be made of all dealings or transactions of or in
relation to the Senior Partnership Note and the properties, business and affairs
of Mortgagor in accordance with generally accepted accounting principles
consistently applied. Said books shall be maintained in an office located either
in Atlantic City, New Jersey or in the Borough of Manhattan, City of New York,
State of New York. Mortgagor shall at any and all times, upon request of
Mortgagee and at the expense of Mortgagor, permit Mortgagee and its
representatives to inspect the Casino Hotel and any other buildings, structures
and improvements now or hereafter located on the Land and the books of account,
records, reports and other papers of Mortgagor, and to make copies and extracts
therefrom, and will afford and procure a reasonable opportunity to make any such
inspection (provided, that any such inspection shall not unreasonably interfere
with the business operations of Mortgagor), and Mortgagor will furnish to
Mortgagee any and all information as Mortgagee may reasonably request, with
respect to the performance by Mortgagor of its covenants in this Mortgage.
Section 5.15. Advances by Mortgagee.
If Mortgagor shall fail to perform any of the covenants, terms,
provisions or conditions contained in this Mortgage and such failure shall
continue for 10 days following notice thereof given by Mortgagee (or at any
time, without notice, in case of emergency), Mortgagee may (but is not obligated
to), at any time and from time to time, take any action or make advances, to
effect performance of any such covenant, term, provision or condition on behalf
of Mortgagor; and all moneys so used, paid or advanced by Mortgagee and all
reasonable costs and expenses incurred by Mortgagee in connection therewith,
together with interest on all of the same at the rate of interest set forth in
the Senior Partnership Note, shall be immediately due and payable by Mortgagor
to Mortgagee and all such moneys, costs and expenses shall be secured by the
lien of this Mortgage prior to the Senior Partnership Note. No such advance or
payment by Mortgagee shall relieve Mortgagor from any default hereunder or
impair any right or remedy of Mortgagee.
Section 5.16. Waiver of Stay, Extension or Usury Laws.
Mortgagor covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any usury, stay or extension law or any
other law which would prohibit or forgive Mortgagor from paying all or any
portion of the obligations secured by this Mortgage, wherever enacted, now or at
any time hereafter in force, or which may otherwise affect the
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covenants or the performance of this Mortgage; and Mortgagor (to the extent that
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it shall not hinder, delay or impede the execution
of any power herein granted to Mortgagee, but shall suffer and permit the
execution of every such power as though no such law had been enacted.
Section 5.17. Eminent Domain.
(a) Mortgagor shall notify Mortgagee immediately upon obtaining
knowledge of any Taking affecting the Trust Estate or any part thereof. If the
Taking is a Taking of less than the whole or substantially all of the Premises
but (i) is estimated to result in an award of more than $10,000,000 or (ii) the
Taking will interfere with or adversely affect the operation of the Casino Hotel
(other than any portion thereof consisting solely of unimproved, paved or
unpaved surface parking) other than to a de minimis extent, then within 30 days
after such Taking, Mortgagor shall deliver to Mortgagee a certificate of an
Architect stating whether, in such Architect's opinion, applicable Legal
Requirements permit the Restoration of any buildings and improvements for the
same uses and to the same size and quality in all material respects as existed
immediately prior to the Taking (and if said certificate states that Legal
Requirements do not permit such Restoration, said certificate shall describe the
manner closest approximating such criteria to which the buildings and
improvements could be so restored and shall be accompanied by a Certificate of
Appraised Value dated not more than 10 days prior to delivery setting forth the
Appraised Value immediately prior to the Taking and the estimated Appraised
Value immediately after the permitted Restoration). If Mortgagor is required to
deliver such Certificate of Appraised value and if based on such Certificate of
Appraised Value immediately after Restoration, (i) the Outstanding Amount of
Indebtedness of the Mortgagor, the Company or TCHI immediately after such
Restoration shall exceed the greater of (A) 80% of the Appraised Value
immediately after such Restoration or (B) the quotient of the Outstanding Amount
of the Indebtedness of the Mortgagor, the Company or TCHI immediately prior to
such Taking divided by the Appraised Value immediately prior to the Taking
multiplied by the Appraised Value immediately after such Restoration, or (ii)
applicable Legal Requirements do not permit the Restoration of the Casino Hotel
for use as a casino and hotel complex, then, in any of such events, the Taking
shall be deemed a Taking of "the whole or substantially all of the Premises."
The Taking shall be deemed a Taking of "less than the whole or substantially all
of the Premises" if Mortgagor is not required to deliver a Certificate Of
Appraised Value or if, at the time of delivery of such Certificate, neither of
the tests set forth in clauses (i) and (ii) is met.
(b) If at any time there shall occur a Taking of less than the
whole or substantially all of the Premises and the award or awards resulting
therefrom payable to Mortgagor (and not to any lessor under any Facility Lease)
(after there shall have been first deducted the fees and expenses incurred in
connection with the termination, settlement and collection of such award or
awards, including, without limitation, reasonable counsel fees and expenses,
hereinafter referred to as "Settlement Costs") (i) shall be less than
$10,000,000 (except to the extent that
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the Insurance Trustee is required to hold such amount pursuant to a Superior
Instrument Requirement), the entire amount of such award shall be paid to
Mortgagor; and (ii) if such award is $10,000,000 or more, the entire amount of
such award shall be paid to the Insurance Trustee. In either event, such awards
shall be applied to the cost of Restoration of the Trust Estate as nearly as
practicable to their uses, value and condition immediately prior to the Taking
(except to the extent otherwise provided by Superior Instrument Requirements).
Mortgagor shall promptly commence and with due diligence perform the Restoration
in accordance with clauses (iii), (iv) and (vii) of Subsection 5.10(e) (after
substituting the words "Taking" for "Casualty" and "award" for "net insurance
proceeds"), at no cost to Mortgagee. All claims or suits arising out of any
Taking may be settled by Mortgagor, except that Mortgagee shall have the right
(but not the obligation) to participate in such claim or suit, and to approve
settlement thereof (and notwithstanding anything in the Facility Leases to the
contrary, Mortgagor shall not agree to any settlement or compromise of the
amount of any such claim or suit, except a claim or suit where the amount
reasonably anticipated to be received by Mortgagor is less than $5,000,000). If
Mortgagee at its election as aforesaid joins such claim or suit, Mortgagee's
approval of such settlement shall not be unreasonably withheld. The Insurance
Trustee shall promptly pay such sums as are received by it from such Taking from
time to time in accordance with the procedures set forth in clauses (v) and (vi)
of Subsection 5.10(e) (after substituting the words "Taking" for "Casualty" and
"award" for "net insurance proceeds").
(c) If at any time there shall occur a Taking of the whole or
substantially all of the Premises, then the award payable to Mortgagor shall not
be applied to Restoration but shall instead be paid and delivered to the Trustee
(subject to the rights of the lessors under any Facility Leases) to the extent
of the then Outstanding Amount of the Senior Partnership Note and any other
interest or other sums due hereunder or thereunder to be applied to the
satisfaction of this Mortgage to the extent proceeds are available for such
purpose and provided that no additional sums are due to the trustee or the
holders under the Senior Notes, the Senior Note Indenture, the Senior Guarantee,
the TCHI Notes, the TCHI Note Indenture, the TCHI Guarantee, the Mortgage Notes
or the Mortgage Note Indenture, the balance of any award shall be paid to
Mortgagor.
(d) Notwithstanding anything contained herein to the contrary, if
an Event of Default shall have occurred and is continuing, Mortgagee may, at its
option, (i) refrain from paying to Mortgagor or the Insurance Trustee any award
or (ii) instruct the Insurance Trustee to pay to Mortgagee any award then held
by the Insurance Trustee, as the case may be.
Section 5.18. Facility Team.
(a) Mortgagor shall do or cause to be done all things necessary to
preserve and keep unimpaired the rights of Mortgagor, as lessee under all
Facility Leases, and, to prevent any termination, surrender, cancellation,
forfeiture or impairment of any thereof. Mortgagor shall at all times fully
perform and comply with all agreements, covenants, terms and conditions
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imposed upon or assumed by it as lessee under each of the Facility Leases
(including, without limitation, the covenant to pay rent and all taxes,
assessments and other charges mentioned therein) prior to the expiration of any
notice and/or cure period provided in each such Facility Lease. Upon receipt by
Mortgagee from a Lessor of any written notice of default by the lessee
thereunder, Mortgagee may rely thereon and take any action Mortgagee deems
necessary in its sole discretion to prevent or to cure any default by Mortgagor
in the performance of or compliance with any of the agreements, covenants, terms
or conditions imposed upon or assumed by Mortgagor as lessee under such Facility
Lease, even though the existence of such default or the nature thereof be
questioned or denied by Mortgagor or by any party on behalf of Mortgagor.
Without limiting the generality of Section 3.9, Mortgagor hereby expressly
grants to Mortgagee, and agrees that Mortgagee shall have, the absolute and
immediate right to enter in and upon the Premises or any part thereof to such
extent and as often as Mortgagee, in its sole discretion, deems necessary or
desirable for the purpose permitted by the immediately preceding sentence,
subject only to applicable Legal Requirements. Without limiting Mortgagor's
obligations or Mortgagee's rights set forth above or limiting Mortgagee's other
remedies under this Mortgage, Mortgagee may pay and expend such sums of money as
Mortgagee in its sole discretion deems necessary for any such purpose, and
Mortgagor hereby agrees to pay to Mortgagee immediately and without demand, all
such sums referred to above, so paid and expended by Mortgagee, together with
interest thereon from the date of each such payment at the highest rate of
interest set forth in the Senior Partnership Note. All sums so paid and expended
by Mortgagee, and the interest thereon, shall be added to and be secured by the
lien of this Mortgage.
(b) Mortgagor further covenants and agrees as follows:
(i) Mortgagor shall not surrender, terminate or cancel any
Facility Lease, and shall not without the consent of Mortgagee modify,
change, supplement, alter or amend any Facility Lease either orally or in
writing if an impairment of the security granted under this Mortgage would
result therefrom. As further security for the repayment of the
indebtedness secured hereby and for the performance of the covenants
herein and in each Facility Lease contained, Mortgagor hereby assigns to
Mortgagee all of Mortgagor's rights, privileges and prerogatives as lessee
under each Facility Lease to terminate, cancel, modify, change,
supplement, alter or amend such Facility Lease and any such termination,
cancellation, modification, change, supplement, alteration or amendment of
a Facility Lease without the prior consent thereto by Mortgagee shall be
void and of no force and effect. Unless (1) an Event of Default has
occurred and is continuing and (2) either (A) there has been an
acceleration of maturity of the Senior Partnership Note pursuant to
Section 3.2 or (B) Mortgagee exercises its rights under Section 3.9,
Mortgagee shall have no right to terminate, cancel, modify, change,
supplement, alter or amend any Facility Lease.
(ii) Solely for the benefit of Mortgagee, Trustee, the Holders
and no other person, no release or forbearance of any of Mortgagor's
obligations under any Facility
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Lease, pursuant to such Facility Lease or otherwise, shall release
Mortgagor from any of Mortgagor's other obligations under this Mortgage.
(iii) Unless Mortgagee shall otherwise expressly consent in
writing, the fee title to the Leased Facilities and Mortgagor's leasehold
estates therein shall not merge and shall always remain separate and
distinct, notwithstanding the union of said estates either in the Lessor
or in the lessee, or in a third party by purchase or otherwise.
(iv) Mortgagor shall promptly notify Mortgagee in writing of
any request made by Mortgagor, as lessee under any Facility Lease, or any
of the Lessors, for arbitration proceedings under any Facility Lease and
of the institution of any arbitration proceedings, as well as all
proceedings thereunder. Mortgagor shall promptly deliver to Mortgagee a
copy of the determination of the arbitrators in each such arbitration
proceeding. Mortgagee shall have the right to participate in such
arbitration proceedings in association with Mortgagor or on its own behalf
as an interested party.
(v) Mortgagor shall not consent to the subordination of any
Facility Lease to any mortgage, deed of trust or other lien on the fee
interest of the Lessor.
(vi) If Mortgagor acquires fee simple title or any other
estate, title or interest in any Leased Facility, Mortgagor shall promptly
notify Mortgagee of such acquisition and, on request by Mortgagee, shall
cause to be executed and recorded all such other and further assurances or
other instruments in writing as may in the opinion of Mortgagee be
required or desirable to carry out the intent and meaning of clause (x) of
Granting Clause Third.
(vii) Within 5 days after Mortgagor's receipt of any notice of
any motion, application or effort to reject any Facility Lease by any
Lessor or any trustee arising from or in connection with any case,
proceeding or other action commenced or pending by or against any Lessor
under the Code or any comparable provision contained in any present or
future federal, state, local, foreign or other statute, law, rule or
regulation ("Comparable Provision"), Mortgagor shall give notice thereof
to Mortgagee. Mortgagor hereby (A) assigns to Mortgagee any and all of
Mortgagor's rights as lessee under Section 365(h) of the Code or any
Comparable Provision and (B) covenants that it shall not elect to treat
any Facility Lease as terminated pursuant to Section 365(h) of the Code or
any Comparable Provision without the prior consent of Mortgagee and (C)
agrees that any such election by Mortgagor without such consent shall be
null and void.
(viii) Without limiting the generality of the foregoing, to
the extent permitted by applicable law, Mortgagor hereby unconditionally
assigns, transfers and sets over to Mortgagee all of Mortgagor's claims
and rights to the payment of damages arising from any rejection by Lessor
of any Facility Lease under the Code or any Comparable Provision.
Mortgagee shall have the right to proceed in its own name or in the name
of
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Mortgagor in respect of any claim, suit, action or proceeding relating to
the rejection of any Facility Lease, including, without limitation, the
right to file and prosecute, in cooperation with Mortgagor, any proofs of
claim, complaints, motions, applications, notices and other documents, in
any case in respect of Lessor under the Code or any Comparable Provision.
This assignment constitutes a present, irrevocable and unconditional
assignment of the foregoing claims, rights and remedies, and shall
continue in effect until all of the indebtedness and obligations secured
by this Mortgage shall have been satisfied and discharged in full. Any
amounts received by Mortgagee in damages arising out of the rejection of
any Facility Lease as aforesaid shall be applied first to all reasonable
costs and expenses of Mortgagee (including, without limitation, reasonable
attorneys' fees, disbursements and court costs) incurred in connection
with the exercise of any of its rights or remedies under this Section
5.18, and thereafter as provided in Section 3.3.
(ix) If there shall be filed by or against Mortgagor a
petition under the Code or any Comparable Provision and Mortgagor, as
lessee under any Facility Lease, shall determine to reject such Facility
Lease, Mortgagor shall give Mortgagee not less than 10 days' prior notice
of the DRAFT ate on which Mortgagor shall apply to the Bankruptcy Court or
other judicial body with appropriate jurisdiction for authority to reject
such Facility Lease. Mortgagee shall have the right, but not the
obligation, to serve upon Mortgagor within such 10-day period a notice
stating that (a) Mortgagee demands that Mortgagor assume and assign such
Facility Lease to Mortgagee pursuant to Section 365 of the Code or any
Comparable Provision and (b) Mortgagee covenants to cure or provide
adequate assurance of prompt cure of all defaults and provide adequate
assurance of future performance under such Facility Lease. If Mortgagee
serves upon Mortgagor the notice described in the preceding sentence,
Mortgagor shall not seek to reject such Facility Lease and shall comply
with the demand provided for in clause (a) of the preceding sentence
within 30 days after the notice shall have been given subject to the
performance by Mortgagee of the covenant provided for in clause (b) of the
preceding sentence. The foregoing provisions of this Section 5.18(ix)
shall not apply to the extent not permitted by applicable law. Effective
upon the entry of an order for relief in respect of Mortgagor under
Chapter 7 of the Code or any Comparable Provision, Mortgagor hereby
assigns and transfers to Mortgagee a non-exclusive right to apply to the
Bankruptcy Court or other judicial body with appropriate jurisdiction for
an order extending the period during which such Facility Lease may be
rejected or assumed.
(x) Mortgagor shall promptly give to Mortgagee copies of (A)
all notices of default and (B) any other communications or notices with
respect to events that relate to the possible impairment of the security
of this Mortgage, which Mortgagor shall give or receive under any Facility
Lease and shall promptly notify Mortgagee of any default under any
Facility Lease on the part of the Lessor or Mortgagor.
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(xi) Mortgagor shall enforce with due diligence all of the
obligations of the Lessor under each Facility Lease, to the end that
Mortgagor may enjoy all of the rights and privileges granted to it under
the Facility Leases.
(xii) Mortgagor shall notify Mortgagee within 5 days after the
transfer of a fee interest in any Leased Facility or any portion thereof
to or from an Affiliate.
(xiii) No Affiliate of Mortgagor shall at any time hereafter
acquire fee title to the Leased Land or any portion thereof unless
simultaneously with such acquisition such Affiliate and Mortgagor execute
and exchange (and deliver to the Trustee an executed counterpart of) an
instrument in form and substance satisfactory to Mortgagee providing that
so long as such Affiliate owns such fee title (A) such Affiliate shall not
terminate the applicable Facility Lease for any reason whatsoever
(including, without limitation, due to the default of Mortgagor under such
Facility Lease) and (B) such Affiliate shall not accept, and, if tendered
by Mortgagor shall promptly return to Mortgagor, any payment of rent or
other charges payable under such Facility Lease in excess of the amount
required to pay the debt service and other sums payable under any mortgage
affecting such Affiliate's fee interest in the applicable Leased Facility
(and such Affiliate shall use such funds only to pay its debt service
obligations and other sums payable under such mortgage) at any time that
an Event of Default, or a Default of the types described in Section
3.1(a), (b) and (f) of this Mortgage or Section 5.1(a), (b), (f) or (g) of
the Senior Note Indenture, shall have occurred and be continuing under
this Mortgage or the Senior Note Indenture.
(c) Subject to the provisions of Subsection 5.18(b)(iii), if both
the lessor's and lessee's estates under any Facility Lease or any portion
thereof shall at any time become vested in one owner, this Mortgage and the lien
created hereby shall nevertheless not be destroyed or terminated by application
of the doctrine of merger and, in such event, Mortgagee shall continue to have
all of the rights and privileges of a first leasehold mortgagee.
(d) Mortgagor hereby acknowledges that if any Facility Lease shall
be terminated prior to the natural expiration of its term due to default by the
lessee thereunder, and if pursuant to such Facility Lease, Mortgagee or its
designee shall acquire from the Lessor a new lease of the Leased Facility or any
portion thereof, Mortgagor shall have no right, title or interest in or to such
lease or the leasehold estate created thereby, or the options therein contained.
(e) Each Facility Lease hereafter entered into or assumed by
Mortgagor as lessee or sublessee shall contain provisions (i) permitting the
assignment of the same to Mortgagee and the Trustee and permitting assignment
without the lessor's consent if this Mortgage is foreclosed; and (ii) providing
protection to Mortgagee, as leasehold mortgagee, in form reasonably satisfactory
to Mortgagee.
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Section 5.19. Indemnification.
Mortgagor shall protect, indemnify, hold harmless and defend
Mortgagee and its directors, officers, partners, shareholders, agents, servants
and employees from and against any and all liabilities, obligations, claims,
damages, penalties, causes of action, costs and expenses (including, without
limitation, reasonable attorneys' fees, disbursements and court costs), imposed
upon or incurred by or asserted against Mortgagee by reason of (a) any injury to
or death of Persons or loss of or damage to property occurring on or about the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (b) any use, nonuse or condition of the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (c) any failure on the part of
Mortgagor to perform or comply with any of the terms of this Mortgage, (d)
performance of any labor or services or the furnishing of any materials or other
property in respect of the Premises or any part thereof made or suffered to be
made by or on behalf of Mortgagor, (e) any negligence or tortious act on the
part of Mortgagor or any of its agents, contractors, lessees, licensees or
invitees, or (f) any work in connection with the Premises; provided, that no
amounts shall be payable to Mortgagee under this Section 5.19 in respect of
liabilities, obligations, claims, damages, penalties, causes of action, costs or
expenses imposed upon or incurred by or asserted against Mortgagee to the extent
the same result from any negligence or tortious act on the part of Mortgagee or
any of its agents, contractors, lessees, licensees or invitees. All amounts
payable to Mortgagee under this Section 5.19 shall be payable on demand;
provided, that with respect to consequential damages (other than attorneys'
fees, disbursements and court costs imposed upon or incurred by Mortgagee in
connection therewith, which shall in all events be payable on demand), no such
amounts shall be payable until, and to the extent that, (i) there has been
entered the final determination of a court of competent jurisdiction awarding
such consequential damages to the party or parties seeking such damages or (ii)
an agreement of settlement with respect thereto (which shall have been
previously approved by Mortgagor, such consent not to be unreasonably withheld)
shall have been executed by Mortgagee and such party or parties. Any such
amounts which are not paid within 5 days after demand therefor by Mortgagee
shall bear interest at the rate set forth in the Senior Partnership Note from
the date of such demand and all such amounts and interest thereon shall be
secured by the lien of this Mortgage. In case any action, suit or proceeding is
brought against Mortgagee by reason of any such occurrence, Mortgagor, upon
request of Mortgagee, shall, at Mortgagor's expense, resist and defend such
action, suit or proceeding or cause the same to be resisted or defended by
counsel designated by Mortgagor and approved by Mortgagee, which approval shall
not be unreasonably withheld; provided, that Willkie, Farr & Gallagher is hereby
approved by Mortgagee.
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Section 5.20. TCHI Mortgages.
(a) Mortgagor shall at all times fully perform and comply with all
agreements, covenants, terms and conditions imposed upon or assumed by it as
mortgagor under the TCHI Mortgages prior to the expiration of any notice and/or
cure period provided in each such TCHI Mortgage. If a notice of default has been
given by the holder of the TCHI Mortgages, Mortgagee may rely thereon and take
any action Mortgagee deems necessary in its sole discretion to prevent or to
cure any default by Mortgagor in the performance of or compliance with any of
the agreements, covenants, terms or conditions imposed upon or assumed by
Mortgagor as mortgagor (or assignee of the mortgagor) under the TCHI Mortgages
even though the existence of such default or the nature thereof be questioned or
denied by Mortgagor or by any party on behalf of Mortgagor. Without limiting the
generality of Section 3.9, Mortgagor hereby expressly grants to Mortgagee, and
agrees that Mortgagee shall have, the absolute and immediate right to enter in
and upon the Premises or any part thereof to such extent and as often as
Mortgagee, in its sole discretion, deems necessary or desirable for the purpose
permitted by the immediately preceding sentence, subject only to applicable
Legal Requirements. Without limiting Mortgagor's obligations or Mortgagee's
rights set forth above or limiting Mortgagee's other remedies under this
Mortgage, Mortgagee may (i) pay and expend such sums of money as Mortgagee in
its sole discretion deems necessary or desirable for any such purpose and (ii)
in its sole discretion prepay the TCHI Mortgages then in default, and Mortgagor
hereby agrees to pay to Mortgagee immediately and without demand, all such sums
referred to in (i) and (ii) above so paid and expended by Mortgagee, together
with interest thereon from the date of each such payment at the highest rate of
interest set forth in the Senior Partnership Note. All sums so paid and expended
by Mortgagee and the interest thereon, shall be added to and be secured by the
lien of this Mortgage.
(b) Mortgagor further covenants and agrees:
(i) Mortgagor shall not, without first obtaining the consent
of Mortgagee in each instance: (A) modify, replace or refinance the TCHI
Mortgages if (x) the collateral securing the lien thereof would be
increased thereby (other than after-acquired property required by the
terms of the TCHI Mortgages to be encumbered thereby) or (y) such
modification, replacement or refinancing violates any other provision of
this Senior Note Mortgage or the Senior Note Indenture or (B) acquire or
permit or suffer any Affiliate of Mortgagor to acquire the TCHI Mortgages
or any Interest therein;
(ii) Mortgagor shall timely pay and perform all of the
obligations to be paid or performed by the mortgagor under the TCHI
Mortgages, the notes secured thereby and any other instrument evidencing
or securing the indebtedness owing to any holder of the TCHI Mortgages;
(iii) at any time and from time to time, Mortgagor shall upon
request of Mortgagee promptly use its reasonable efforts to obtain an
estoppel certificate or letter
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addressed to Mortgagee from the holder of the TCHI Mortgages, such
certificate or letter to be in such form as Mortgagee shall reasonably
request;
(iv) Mortgagor shall promptly give to Mortgagee copies of (A)
all notices of default or (B) any other notice or communication with
respect to events which relate to the possible impairment of the security
of this Mortgage, which Mortgagor shall give or receive under the TCHI
Mortgages and shall promptly notify Mortgagee of any default under the
TCHI Mortgages on the part of Mortgagor.
[Remainder of this Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duty executed and attested, all as of the day and year first above written.
TRUMP'S CASTLE ASSOCIATES, L.P., a
New Jersey limited partnership
By: Trump's Castle Hotel & Casino,
Inc., its general partner
Witness: /s/ Carol Leslie By: /s/ Nicholas L. Ribis
------------------- -------------------------------------
Carol Leslie Name: Nicholas L. Ribis
Title: President and Chief Executive
Officer
TRUMP'S CASTLE FUNDING, INC., a
New Jersey Corporation
Witness: /s/ Carol Leslie By: /s/ Nicholas L. Ribis
------------------- -------------------------------------
Carol Leslie Name: Nicholas L. Ribis
Title: President and Chief Executive
Officer
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STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me
the subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the President and Chief Executive Officer of TRUMP'S CASTLE
HOTEL & CASINO, INC., the general partner of TRUMP'S CASTLE ASSOCIATES, L.P.,
who I am satisfied is the person who executed the within instrument and he
acknowledged that he signed and delivered the same as such officer on behalf of
such entity and that the within instrument is the voluntary act and deed of said
corporation made by virtue of the authority of its board of directors.
/s/ Marcus Chioffi
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me
the subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the President and Chief Executive Officer of TRUMP'S CASTLE
FUNDING, INC., who I am satisfied is the person who executed the within
instrument and he acknowledged that he signed and delivered the same as such
officer on behalf of such entity and that the within instrument is the voluntary
act and deed of said corporation made by virtue of the authority of its board of
directors.
/s/ Marcus Chioffi
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-67-
<PAGE>
Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of Mortgage
and Security Agreement from Trump's Castle Associates to Trump's Castle Funding,
Inc. dated as of December 28, 1993 and recorded in the Atlantic County Registry
of Deeds in Mortgage Book 5238, Page 1, the mortgagee's interest in which was
assigned to First Bank National Association, now known as U.S. Bank National
Association, by a certain Senior Assignment Agreement dated as of December 28,
1993 and recorded in the Atlantic County Registry of Deeds in Assignment Book
651, Page 160 (the "Subordinate Associates Mortgage") hereby consents to and
acknowledges the provisions of the foregoing Senior Note Mortgage and hereby
subordinates the lien created by the Subordinate Associates Mortgage to this
Senior Note Mortgage.
U.S. BANK NATIONAL ASSOCIATION, a national
banking association
By: /s/ Richard H. Prokosch
----------------------------------
Name: Richard M. Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me
the subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-68-
<PAGE>
Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of
Mortgage and Security Agreement from Trump's Castle Associates to First Bank
National Association, now known as U.S. Bank National Association, dated as of
December 28, 1993 and recorded in the Atlantic County Registry of Deeds in
Mortgage Book 5239, Page 1 (the "Subordinate Mortgage") hereby consents to and
acknowledges the provisions of the foregoing Senior Note Mortgage and hereby
subordinates the lien created by the Subordinate Mortgage to this Senior Note
Mortgage.
U.S. BANK NATIONAL ASSOCIATION, a national
banking association
By: /s/ Richard H. Prokosch
----------------------------------
Name: Richard H. Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me
the subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-69-
<PAGE>
SCHEDULE 1
OWNED LAND
All the real property located in the City of Atlantic City, County of Atlantic,
and State of New Jersey and more particularly described as follows:
CASINO-HOTEL PARCEL
All that certain real property hereinafter particularly described situate, lying
and being in the City of Atlantic City, County of Atlantic and State of New
Jersey.
BEGINNING at the point of intersection of the northwesterly line of Huron Avenue
(100 feet wide) and the northeasterly line of the Atlantic Brigantine Boulevard,
said Boulevard also known as State Highway Route 87, and extending; thence
1. North 45 degrees 50 minutes 06 seconds West, in and along the
Atlantic-Brigantine Boulevard, 56.63 feet; thence
2. North 19 degrees 16 minutes 38 seconds East, still in and along
said Boulevard, 81.94 feet to a point of curve; thence
3. Curving to the right in the arc of a circle having a radius of
783.00 feet, the arc length of 72.815 feet to a point of reverse curve; thence
4. Curving to the left in the arc of a circle having a radius of
837.00 feet, the arc length of 77.836 feet to another point of reverse curve;
thence
5. Curving to the right in the arc of a circle having a radius of
2946.00 feet; the arc length of 1017.42 feet to a point; thence
6. North 44 degrees 34 minutes 15 seconds East, 135.02 feet to a
point of curve; thence
7. Curving to the right in the arc of a circle having a radius of
2936.00 feet, the arc length of 105.48 feet to a point; thence
8. South 27 degrees 28 minutes 00 seconds East, at right angles to
Huron Avenue 842.02 feet to the northwesterly line of Huron Avenue; thence
9. South 62 degrees 32 minutes 00 seconds West, in and along the
northwesterly line of Huron Avenue, 1229.40 feet to the point and place of
BEGINNING.
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<PAGE>
EXCEPTING THEREOUT AND THEREFROM the property which was conveyed to the State of
New Jersey by the Deeds recorded in Deed Book 3980 page 180 and in Deed Book
4031 page 299.
BEING ALSO KNOWN AND DESIGNATED as Lot 9 in Block H-19 on the Official Tax Map
of the City of Atlantic City.
PARKING FACILITIES PARCEL
BEGINNING at a point in Beach Thorofare at the easterly corner of the parcel of
lands containing an area of 6.199 acres more or less which was conveyed by the
West Jersey and Seashore Railroad Company to the Press Union Publishing Company
by deed dated January 9, 1940, and recorded January 17, 1940 in Deed Book 1099
page 420, said beginning point being South 24 degrees 54 minutes 00 seconds
West, a distance of 100.16 feet from a monument set in the southeasterly line of
Absecon Boulevard (also known as U.S. Route 30) (190 feet wide), and extending
from said beginning point; thence,
(1) In Beach Thorofare, South 24 degrees 54 minutes 00 seconds West, a
distance of 259.81 feet to a point; thence
(2) Continuing in and along same, South 44 degrees 54 minutes 00 seconds West,
a distance of 445.50 feet to a point; thence,
(3) Continuing in and along same, South 72 degrees 24 minutes 00 seconds West,
a distance of 224.40 feet to a point; thence
(4) Continuing in and along same, North 68 degrees 21 minutes 00 seconds West,
a distance of 478.50 feet to a point; thence
(5) Continuing in and along same, North 76 degrees 06 minutes 00 seconds West,
a distance of 363.00 feet to a point; thence
(6) Continuing in and along same, South 82 degrees 39 minutes 00 seconds West,
a distance of 429.00 feet to a point; thence,
(7) Continuing in and along same, North 17 degrees 59 minutes 20 seconds East,
a distance of 320.65 feet to a point located in the approximate high water
line of Beach Thorofare, said point also being a corner of lands now or
formerly in Daniel Adams, et al., as recorded in Deed Book CC Page 272;
thence,
(8) North 39 degrees 01 minutes 00 seconds West, leaving Beach Thorofare, in
and along the line of lands now or formerly of Daniel Adams, et al., a
distance of 1089.00 feet to a point in the southeasterly line of lands now
or formerly of Lot 307 in Block 201 as shown on the current Official Tax
Map for the City of Atlantic City, said point also being a corner to lands
1-2
<PAGE>
now or formerly of Daniel Adams, et al.; thence,
(9) North 57 degrees 59 minutes 00 seconds East, in and along the said lands,
a distance of 1113.19 feet to a point in the aforesaid southwesterly line
of Absecon Boulevard; thence,
(10) South 22 degrees 46 minutes 10 seconds East, in and along same, a distance
of 185.42 feet to a point of curve; thence,
(11) Southeastwardly, in and along same and in the arc of a circle curving to
the left having a radius of 1527.69 feet the arc length of 213.90 feet to
a point in the northwesterly line of Lot 230 in said Block 201; thence,
(12) South 09 degrees 08 minutes 24 seconds East, in the southwesterly line of
Absecon Boulevard, a distance of 87.75 feet to a point of curve; thence
(13) Curving to the left along the line of Absecon Boulevard, in the arc of a
circle having a radius of 332.00 feet, the arc length of 201.61 feet to a
point of tangent; thence
(14) South 43 degrees 56 minutes 03 seconds East, continuing in and along the
southwesterly line of Absecon Boulevard, a distance of 128.55 feet to a
point; thence
(15) South 82 degrees 36 minutes 59 seconds East, continuing in and along the
said southwesterly line of Absecon Boulevard, a distance of 10.00 feet to
a point; thence
(16) Curving to the right along the line of Absecon Boulevard, in the arc of a
circle having a radius of 70.00 feet, the arc length of 47.26 feet to a
point of tangent; thence
(17) North 46 degrees 03 minutes 57 seconds East, along the line of Absecon
Boulevard, a distance of 20.81 feet to a point which is radially distant
95.00 feet from the centerline of Absecon Boulevard (190' wide) at station
335+98.63 feet; thence
(18) Curving to the left in the Southwesterly line of Absecon Boulevard in the
arc of a circle having a radius of 1527.69 feet, the arc length of 70.33
feet to the northwesterly line of Lot 230 in said Block 201; thence
(19) South 41 degrees 59 minutes 00 seconds West, in and along same, a distance
of 125.00 feet to the extreme westerly corner of said Lot 230; thence
(20) Southeastwardly, in and along the southwesterly line of same, concentric
with Absecon Boulevard, in the arc of a circle curving to the left, having
a radius of 1652.69 feet, the arc length of 324.55 feet to the extreme
southeasterly corner of said Lot 230; thence
(21) North 30 degrees 43 minutes 55 seconds East, in and along the
southeasterly line of same, a
1-3
<PAGE>
distance of 125.00 feet to a point in the aforesaid southwesterly line of
Absecon Boulevard; thence
(22) Southeastwardly, in and along same and in the arc of a circle curving to
the left, having a radius of 1527.69 feet, the arc length of 245.58 feet
to a point of tangency; thence
(23) South 68 degrees 22 minutes 10 seconds East, in and along same, a distance
of 50.00 feet to a point in the westerly line of the previously mentioned
6.199+/- acre parcel, also being the northwesterly line of Lot 150 in said
Block 201; thence
(24) South 21 degrees 38 minutes 00 seconds West, in and along same, a distance
of 100.00 feet to a corner in said Lot 150; thence
(25) Continuing in and along same, North 68 degrees 22 minutes 10 seconds west,
a distance of 94.75 feet to a corner; thence
(26) Continuing in and along same, South 27 degrees 48 minutes 00 seconds West,
a distance of 89.04 feet to a corner; thence
(27) Continuing in and along same, South 54 degrees 39 minutes 00 seconds West,
a distance of 65.88 feet to a corner; thence
(28) Continuing in and along same, South 71 degrees 53 minutes 00 seconds West,
a distance of 201.55 feet to a corner; thence
(29) Continuing in and along same, South 51 degrees 29 minutes 00 seconds east,
a distance of 172.09 feet to a corner; thence
(30) Continuing in and along same, South 25 degrees 20 minutes 00 seconds east,
a distance of 216.73 feet to a corner; thence
(31) Continuing in and along same and crossing the aforesaid high water line of
Beach Thorofare, South 84 degrees 22 minutes 00 seconds East, a distance
of 256.83 feet to a corner; thence
(32) Continuing in and along same, North 79 degrees 58 minutes 00 seconds East,
a distance of 279.10 feet to a corner; thence
(33) Continuing in and along same, North 41 degrees 22 minutes 00 seconds cast,
a distance of 266.39 feet to the point and place of BEGINNING.
BEING ALSO KNOWN AND DESIGNATED as Lot 231 in Book 201 on the Official Tax Map
of the City of Atlantic City.
1-4
<PAGE>
(PEDESTRIAN BRIDGE)
Air rights, rights of way and easements including the right to construct,
maintain and use a Pedestrian Bridge across Huron Avenue connecting the
Casino-Hotel Parcel with the Farley State Marina Site contained in Ordinance No.
2 of 1988 and affecting the following described premises:
ALL that certain lot, tract, or parcel of land and premises situate, lying, and
being in the City of Atlantic City, County of Atlantic, and State of New Jersey,
bounded and described as follows:
BEGINNING at a point in the southerly line of Huron Avenue (100 feet wide), said
point being distant 956.00' eastwardly from the easterly line of Maryland Avenue
(65 feet wide), if same were extended northwardly, and extending from said
beginning point; thence
(1) North 27 degrees 28 minutes 00 seconds West, crossing Huron Avenue, a
distance of 100.00 feet to the northerly line of Huron Avenue; thence
(2) North 62 degrees 32 minutes 00 seconds East, in and along the northerly
line of Huron Avenue, a distance of 30.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, crossing Huron Avenue, a
distance of 100.00 feet to the southerly line of Huron Avenue; thence
(4) South 62 degrees 32 minutes 00 seconds West, in and along the southerly
line of Huron Avenue, a distance of 30.00 feet to the point and place of
BEGINNING.
BEING an area above the horizontal plane of Huron Avenue between the elevation
of 25.00 M.S.L. datum and 50.00 M.S.L. datum.
1-5
<PAGE>
SCHEDULE 2
Leased Land
THE FARLEY STATE MARINA SITE
Beginning at the southeasterly comer of Maryland Avenue (68.00 feet
wide and Huron Avenue 100.00 feet wide) and extending from said beginning point;
thence
(1) South 27 degrees 28 minutes 00 seconds East, in and along the easterly
line of Maryland Avenue, a distance of 804.15 feet; thence
(2) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, a distance of 200.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, parallel with Maryland
Avenue, a distance of 1060.85 feet to a point distant 1745.00'
northwardly at right angles from the northerly line of Mediterranean
Avenue (60.00 feet wide), said point being in the fifth course as
recited in the Riparian Grant from the State of New Jersey to the City
of Atlantic City, dated March 15, 1920 and recorded in the Clerk's
Office of Atlantic County in Book 632 of Deeds, Page 117, etc.; thence
(4) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, and in and along said aforementioned Riparian Grant Line, a
distance of 25.00 feet; thence
(5) North 27 degrees 28 minutes 00 seconds West, parallel with Maryland
Avenue, and in and along said aforementioned Riparian Grant Line, a
distance of 9.26 feet; thence
(6) North 09 degrees 01 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 0.04 feet; thence
(7) North 02 degrees 18 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 590.00 feet; thence
(8) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, in and along said aforementioned Riparian Grant Line, a
distance of 160.00 feet; thence
(9) North 41 degrees 39 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 255.00 feet; thence
2-1
<PAGE>
(10) North 47 degrees 34 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 285.00 feet; thence
(11) North 56 degrees 02 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 360.80' to a point
distant 1550.00 feet eastwardly at right angles from the easterly line
of Maryland Avenue; thence
(12) North 27 degrees 28 minutes 00 seconds West, parallel with Maryland
Avenue, a distance of 568.21 feet; thence
(13) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, a distance of 200.00 feet to the westerly line of Rhode Island
Avenue (50.00 feet wide); thence
(14) North 27 degrees 28 minutes 00 seconds West, in and along the westerly
line of Rhode Island Avenue, a distance of 570.00 feet to the southerly
line of Huron Avenue; thence
(15) South 62 degrees 32 minutes 00 seconds West, in and along the southerly
line of Huron Avenue, a distance of 1750.00 feet to the point and place
of BEGINNING.
EXCEPTING THEREOUT AND THEREFROM the following parcel of land described as:
MARINE POLICE BUILDING PARCEL
BEGINNING at a point in the westerly line of Rhode Island Avenue (50.00 feet
wide), said point being distant 570.00 feet south of the southerly line of Huron
Avenue (100.00 feet wide) and extending; thence
1. South 62 degrees 32 minutes 00 seconds West, parallel with Huron
Avenue, and in and along the division line between Lot 10 and Lot 11 in
Block B-4 as shown on the current taxing plan of the City of Atlantic
City, a distance of 97.97 feet; thence
2. North 27 degrees 28 minutes 00 seconds West, parallel with Rhode Island
Avenue, a distance of 179.00 feet; thence
3. North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, a distance of 97.97 feet to the Westerly line of Rhode Island
Avenue; thence
4. South 27 degrees 28 minutes 00 seconds East, in and along the westerly
line of Rhode Island Avenue, a distance of 179.00 feet to the point and
place of BEGINNING.
ALSO EXCEPTING THEREON AND THEREFROM such land and improvements being referred
to as the 7 berths on K dock, for use of the Marina Law Enforcement Bureau as
further described in
2-2
<PAGE>
the Lease referred to in a Short Form Memorandum of Lease recorded in Deed Book
5365, Page 221, and further shown on survey by Arthur W. Ponzio Co. & Assoc.,
Inc., dated December 28, 1993 and bearing Job No. 18488.
BEING ALSO KNOWN AND DESIGNATED as part of Lot 11 in Block B-4 as shown on the
Official Tax Map of Atlantic City, New Jersey.
2-3
<PAGE>
SCHEDULE 3
Existing Encumbrances
1. All matters disclosed in Schedule B and D of the Pro Forma Title
Insurance Policies issued as of the date hereof by Chicago Title Insurance
Company (Numbers 31-131-107-03894 and 31-131-107-03909), First American Title
Insurance Company (Numbers 252242 and 255354) and Commonwealth Land Title
Insurance Company (Numbers L980366 and L980366A);
2. All matters disclosed in Schedule C of the Pro Forma Title
Insurance Policies issued as of the date hereof by Chicago Title Insurance
Company (Numbers 31-131-107-03894 and 31-131-107-03909), First American Title
Insurance Company (Numbers 252242 and 255354) and Commonwealth Land Title
Insurance Company (Numbers L980366 and L980366A);
3. All UCC-1 Financing Statements naming Trump's Castle Associates,
L.P., as debtor, and filed prior to April 17, 1998, other than those filed in
favor of (i) Midlantic National Bank, (ii) PNC Bank, N.A., or (iii) First Bank
National Association, as Trustee, under the previously existing Senior Notes;
4. Judgment Number CV-02371-93, entered on September 18, 1997 and
Judgment Number DJ-426844-97, entered on October 20, 1997, both in favor of
Amplicon, Inc.;
5. UCC-1 Financing Statement Number 0018501, filed August 14, 1995,
naming Somerset Ice Co. Inc., as Debtor, and NatWest Bank, N.A., as Secured
Party;
6. UCC-1 Financing Statement Number 0017919, filed May 19, 1995, in
favor of Madison Leasing Co., Inc., as Secured Party, and United Jersey Bank, as
Assignee;
7. UCC-1 Financing Statement Number 0017931, filed May 22, 1995, in
favor of Madison Leasing Co., Inc., as Secured Party, and NatWest, as Assignee;
8. UCC-1 Financing Statement Number 0017932 filed May 22, 1995, in
favor of Madison Leasing Co., Inc., as Secured Party, and Valley National Bank,
as Assignee;
9. UCC-1 Financing Statement Number 0017933, filed May 22, 1995, in
favor of Madison Leasing Co., Inc., as Secured Party, and Bank of New York, as
Assignee;
10. Account balances due to Atlantic City Municipal Utilities
Authority for the properties through April 17, 1998.
3-1
<PAGE>
SCHEDULE 4
FORM OF NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
THIS AGREEMENT, made as of the _____ day of ________ by and between
U.S. Bank National Association (hereinafter called "Mortgagee") having an office
at 180 Fifth Street, St. Paul, Minnesota 55101 and ____________________________
a corporation having an office at _____________________________ (hereinafter
called "Tenant").
W I T N E S S E T H:
WHEREAS, Mortgagee is the mortgagee under that certain Indenture of
Mortgage dated April 17, 1998 (said mortgage, as it may be amended, increased,
renewed, modified, consolidated, replaced, combined, substituted, severed,
split, spread or extended, being hereinafter referred to as the "Mortgage")
between Trump's Castle Funding, Inc. ("Funding") and Trump's Castle Associates,
L.P. (the "Partnership") which encumbers Trump Marina Hotel Casino and certain
other real property located in Atlantic City, New Jersey, more particularly
described in Exhibit A hereto. Funding assigned all of its right, title and
interest in the Mortgage to U.S. Bank National Association, as Trustee under
that certain Indenture dated as of April 17, 1998 by and between Mortgagee,
Funding and the Partnership, pursuant to a Senior TCHI Assignment Agreement
dated as of April 17, 1998; and
WHEREAS, Tenant has entered into a certain agreement of lease dated
__________ [as amended by agreements dated __________ and __________] and as it
may be hereafter amended from time to time (the "Lease") covering (the "Demised
Premises").
NOW, THEREFORE, in consideration of the mutual agreements herein
contained and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. Tenant covenants and agrees that the Lease now is and shall at
all times continue to be subject and subordinate in each and every respect to
the Mortgage. Tenant, upon request, shall execute and deliver any certificate or
other instrument which the Mortgagee may reasonably request to confirm said
subordination by Tenant.
2. Tenant certifies that the Lease is presently in full force and
effect and unmodified and no base rent payable thereunder has been paid more
than one (1) Year in advance of its due date, and that no default exists under
the Lease which has continued beyond the expiration of any applicable grace
period.
4-1
<PAGE>
3. As long as Tenant is in compliance with the terms of this
Agreement and no default exists under the Lease which has continued beyond the
expiration of any applicable grace period, Mortgagee shall not name Tenant as a
party defendant to any action for foreclosure or other enforcement thereof
(unless required by law), nor shall the Lease be terminated by mortgagee in
connection with, or by reason of, foreclosure or other proceedings for the
enforcement of the Mortgage, or by reason of a transfer of the landlord's
interest under the Lease pursuant to the taking of a deed in lieu of foreclosure
(or similar device), nor shall Tenant's use or possession of the Demised
Premises be interfered with by Mortgagee, unless the holder of the landlord's
interest under the Lease (the "Landlord") would have had such right if the
Mortgage had not been made, except that the person acquiring, or succeeding to
the interests of the Landlord as a result of any such action or proceeding, and
such person's successors and assigns (any of the foregoing being hereinafter
referred to as the "Successor"), shall not be:
(a) subject to any credits, offsets, defenses or claims which Tenant
might have against any prior landlord; nor
(b) bound by any base rent which Tenant might have paid for more
than the current month to any prior landlord, unless such prepayment shall
have been made with Mortgagee's prior written consent; nor
(c) liable for any act or omission of any prior landlord; nor
(d) bound by any covenant to undertake or complete any improvement
to the Demised Premises or the building forming a part of the Property;
nor
(e) be required to account for any security deposit other than any
security deposit actually delivered to the Successor; nor
(f) liable for any payment to Tenant of any sums, or the granting to
Tenant of any credit, in the nature of a contribution towards the cost of
preparing, furnishing or moving into the Demised Premises or any portion
thereof.
4. if the interest of the Landlord under the Lease shall be referred
by reason of foreclosure or other proceedings for enforcement of the Mortgage or
pursuant to a taking of a deed in lieu of foreclosure (or similar device),
Tenant shall be bound to the Successor, and, except as provided in this
Agreement, the Successor shall be bound to Tenant, under all of the terms,
covenants and conditions of the Lease for the balance of the term thereof
remaining, with the same force and effect as if the Successor were the Landlord,
and Tenant does hereby (i) agree to attorn to the Successor, including Mortgagee
if it be the Successor, as its landlord, (ii) affirm its obligations under the
Lease, and (iii) agree to make payments of all sums due under the Lease to the
Successor, said attornment, affirmation and agreement to be effective and
self-operative without the execution of any further instruments, upon the
Successor succeeding to the interest to the Landlord under the Lease. Tenant
waives the provisions of any statute or rule of law now or hereafter in effect
that may
4-2
<PAGE>
give or purport to give it any right or election to terminate or
otherwise adversely affect the Lease or the obligations of Tenant thereunder by
reason of any foreclosure or similar proceeding.
5. This Agreement may not be modified except by an agreement in
writing signed by the parties or their respective successors in interest. This
Agreement shall inure to the benefit of and be binding upon the parties hereto,
their respective heirs, representatives, successors and assigns.
6. Nothing contained in this Agreement shall in any way impair or
affect the lien created by the Mortgage except as specifically set forth herein.
7. The Tenant agrees that this Agreement satisfies any condition or
requirement in the Lease relating to the granting of a non-disturbance agreement
by Mortgagee. Tenant further agrees that in the event there is any inconsistency
between the terms and provisions hereof and the terms and provisions of the
Lease dealing with non-disturbance by Mortgagee, the terms and provisions hereof
shall be controlling.
8. All notices, demands or requests made pursuant to, under, or by
virtue of this Agreement must be in writing and mailed to the party whom the
notice, demand or request is being made by certified or registered mail, return
receipt requested, at its address set forth above. Any party may change the
place that notices and demands are to be sent by written notice delivered in
accordance with this Agreement.
9. This Agreement shall be governed by the laws of the State of New
Jersey. If any term of this Agreement or the application thereof to any person
or circumstances shall to any extent be invalid or unenforceable, the remainder
of this Agreement or the application of such term to any person or circumstances
other than those as to which it is invalid or unenforceable shall not be
affected thereby, and each term of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.
4-3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have hereunto caused this
Agreement to be duly executed as of the day and year first above written.
MORTGAGEE
By:_____________________________
TENANT
By:_____________________________
[Acknowledgments]
4-4
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
(Senior Guarantee Mortgage)
TRUMP'S CASTLE ASSOCIATES, L.P.
Mortgagor/Debtor
and
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Senior Note Indenture, Mortgagee/Secured Party
Dated as of April 17, 1998
Record and Return to:
Robert L. Nutt, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110-2624
<PAGE>
TABLE OF CONTENTS
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION. 8
Section 1.1. Definitions.................................. 8
Section 1.2. Notices......................................18
Section 1.3. Form and Contents of Documents Delivered
to Mortgagee ................................19
Section 1.4. Compliance Certificates and Opinions.........20
Section 1.5. Effect of Headings and Table of Contents.....20
Section 1.6. Successors and Assigns; Amendments...........21
Section 1.7. Separability Clause..........................21
Section 1.8. Benefits of Mortgage.........................21
Section 1.9. Governing Law................................21
Section 1.10. Limitation on Liability......................21
Section 1.11. Provisions Required by Senior Note
Indenture ...................................22
Section 1.12. Rights of Trustee as Mortgagee...............22
Section 1.13. Mortgage Subject to Casino Control Act.......23
Section 1.14. Discharge of Lien............................23
Section 1.15. General Application..........................24
Section 1.16. Senior Guarantee Mortgage Deemed to be
Security Agreement ..........................24
Section 1.17. No Duplication of Notices or Payments........24
ARTICLE TWO RELEASE; SUBORDINATION...................................25
Section 2.1. Possession by Mortgagor......................25
Section 2.2. Obsolete Property............................25
Section 2.3. F,F&E Financing Agreements...................26
ARTICLE THREE REMEDIES ..............................................27
Section 3.1. Events of Default............................27
Section 3.2. Acceleration of Maturity; Recision and
Annulment ...................................28
Section 3.3. Application of Moneys Received by Mortgagee..29
Section 3.4. Restoration of Rights and Remedies...........29
Section 3.5. Rights and Remedies Cumulative...............29
Section 3.6. Delay or Omission Not Waiver.................29
Section 3.7. Undertaking for Costs........................29
Section 3.8. Waiver of Appraisement and Other Laws........30
Section 3.9 Entry .......................................30
Section 3.10. Power of Sale; Suits for Enforcement.........31
Section 3.11. Incidents of Sale............................31
Section 3.12. Receiver.....................................32
Section 3.13. Suits to Protect the Trust Estate............32
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Section 3.14. Management of the Premises...................33
ARTICLE FOUR CONSOLIDATION, MERGER, CONVEYANCE,TRANSFER OR LEASE.....33
Section 4.1. Consolidation, Merger, Conveyance or
Transfer only on Certain Terms ..............33
Section 4.2. Successor Entity Substituted.................33
ARTICLE FIVE COVENANTS AND REPRESENTATIONS OF MORTGAGOR..............34
Section 5.1. Performance of Senior Guarantee Obligations..34
Section 5.2. F,F&E Financing Agreements...................34
Section 5.3. Limitations on Liens and Transfers...........34
Section 5.4. Environmental................................35
Section 5.5. Warranty of Leasehold Estate and Title.......38
Section 5.6. After-Acquired Property; Further Assurances;
Recording ...................................39
Section 5.7. Payment of Taxes and Certain Claims;
Maintenance of Properties; Compliance with
Legal Requirements and Insurance
Requirements ................................41
Section 5.8. Permitted Contests...........................42
Section 5.9. Mechanics' and Other Liens...................43
Section 5.10. To Insure....................................43
Section 5.11. Limitations on Building Demolition,
Alterations, Improvements and New
Construction.................................49
Section 5.12 Leases ......................................51
Section 5.13. Compliance Certificates......................53
Section 5.14. To Keep Books; Inspection by Mortgagee.......53
Section 5.15. Advances by Mortgagee........................54
Section 5.16. Waiver of Stay, Extension or Usury Laws......54
Section 5.17. Eminent Domain...............................54
Section 5.18. Facility Leases..............................56
Section 5.19. Indemnification..............................60
Section 5.20. TCHI Mortgages...............................61
SCHEDULE 1 OWNED LAND ...............................................1-1
SCHEDULE 2 LEASED LAND ..............................................2-1
SCHEDULE 3 EXISTING ENCUMBRANCES.....................................3-1
SCHEDULE 4 FORM OF NON-DISTURBANCE
AND ATTORNMENT AGREEMENT.............................................4-1
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INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT ("Mortgage" or "Senior
Guarantee Mortgage"), dated as of April 17, 1998, between TRUMP'S CASTLE
ASSOCIATES, L.P., a New Jersey limited partnership having an office at
Brigantine Boulevard and Huron Avenue, Atlantic City, New Jersey 08401
("Mortgagor"), and U.S. BANK NATIONAL ASSOCIATION, a national banking
association, not individually but in its capacity as Trustee under the Senior
Note Indenture (as hereinafter defined), having an office at 180 East Fifth
Street, St. Paul, Minnesota 55101 ("Mortgagee").
Witnesseth:
In consideration of $10.00 in hand paid by Mortgagee to Mortgagor and for
other good and valuable consideration, the receipt and sufficiency whereof is
hereby acknowledged, and in order to secure (i) the punctual payment and
performance when due of all of Mortgagor's obligations under the Senior
Guarantee; (ii) the punctual payment and performance when due of all the
Company's and Mortgagor's obligations under the Senior Notes and the Senior Note
Indenture; (iii) payment by Mortgagor to Mortgagee of all sums expended or
advanced by Mortgagee pursuant to any term or provision of this Senior Guarantee
Mortgage; (iv) performance of each covenant, term, condition and agreement of
Mortgagor herein contained; (v) all costs and expenses, including, without
limitation, reasonable counsel fees and expenses as provided in Section 3.7 of
this Senior Guarantee Mortgage, which may arise in respect of this Senior
Guarantee Mortgage or of the obligations secured hereby; and (vi) performance
and observance of all of the provisions herein contained, Mortgagor has executed
and delivered this Senior Guarantee Mortgage and has bargained, sold, aliened,
mortgaged, pledged, released, conveyed and confirmed unto Mortgagee and its
successors hereunder and assigns forever, and does hereby grant to Mortgagee and
its successors a security interest in and to, all of Mortgagor's right, title
and interest in, to and under all of the following described property and the
proceeds thereof:
GRANTING CLAUSES
Granting Clause First
All of the property, rights, title, interest, privileges and franchises
particularly described in annexed Schedule 1 (the "Owned Land"), which Schedule
is hereby made a part of, and deemed to be described in, this Granting Clause as
fully as if set forth in this Granting Clause at length.
<PAGE>
Granting Clause Second
[Intentionally omitted]
Granting Clause Third
All of the property, rights, title, interest, privileges and franchises of
Mortgagor as lessee under all Facility Leases (including, to the extent
permissible under the Marina Lease, the Marina Lease), together with (i) all
credits, deposits, privileges and rights of Mortgagor as lessee under the
Facility Leases, now or at any time existing, (ii) the leaseholds and the
leasehold estates created by the Facility Leases and (iii) all of the estates,
rights, titles, claims or demands whatsoever of Mortgagor, either in law or in
equity, in possession or in expectancy, of, in and to the Facility Leases and
the Leased Facilities (including, but not limited to, the Leased Land
particularly described in annexed Schedule 2), together with (x) any and all
other, further or additional title, estates, interests or rights which may at
any time be acquired by Mortgagor in or to the Leased Facilities or any part
thereof, and Mortgagor expressly agrees that if Mortgagor shall, at any time
prior to payment in full of all indebtedness secured hereby, acquire fee simple
title or any other greater estate to the Leased Facilities, the lien of this
Senior Guarantee Mortgage shall attach, extend to, cover and be a lien upon such
fee simple title or other greater estate and thereupon the lien of this Senior
Guarantee Mortgage, subject to Permitted Encumbrances, shall be prior to the
lien of any mortgage or deed of trust placed on such acquired title, estate,
interest or right subsequent to the date of this Senior Guarantee Mortgage and
(y) any right to possession or statutory term of years derived from, or incident
to, the Facility Leases pursuant to Section 365(h) of the Code or any Comparable
Provision.
Granting Clause Fourth
All of the rents, issues, profits, revenues, accounts, accounts receivable
and other income and proceeds (including, without limitation, all rents, fees,
charges, accounts, issues, profits, revenues and payments for or from (a) the
use or occupancy of the rooms and other public facilities in the Hotel and (b)
the operation of the Casino) of the property subjected or required to be
subjected to the lien of this Senior Guarantee Mortgage, including, without
limitation, the property described in Granting Clauses First, Third and Seventh
(said property described in Granting Clauses First, Third and Seventh and
similar other property subjected or required to be subjected to the lien of this
Senior Guarantee Mortgage, together with all such rents, issues, profits,
revenues, accounts, accounts receivable and other income and proceeds therefrom
is hereinafter collectively referred to as the "Premises") and all of the
estate, right, title and interest of every nature whatsoever of Mortgagor in and
to the same and every part thereof.
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Granting Clause Fifth
All of the rights of Mortgagor as lessor under the Leases in effect on the
date of execution of this Senior Guarantee Mortgage or hereafter entered into by
Mortgagor, including modifications, extensions and renewals of all of the same,
and the immediate and continuing right as security after the occurrence, and
during the continuance, of an Event of Default, to (a) make claim for, collect,
receive and receipt for (and to apply the same as provided herein) any and all
rents, fees, charges, income, revenues, issues, profits, security and other sums
of money payable or receivable thereunder or pursuant thereto, and all proceeds
thereof, whether payable as rent, insurance proceeds, condemnation awards,
security or otherwise and whether payable prior to or subsequent to the Stated
Maturity of the Senior Notes, (b) receive and give notices and consents
thereunder, (c) bring actions and proceedings thereunder or for the enforcement
thereof, (d) make waivers and agreements thereunder or with respect thereto, (e)
take such action upon the happening of a default under any Lease, including the
commencement, conduct and consummation of any proceedings at law or in equity as
shall be permitted by any provision of any Lease, and (f) do any and all things
which Mortgagor or any lessor is or may become entitled to do under the Leases;
provided that, except as may be set forth to the contrary herein, the assignment
made by this Granting Clause Fifth shall not impair or diminish any right,
privilege or obligation of Mortgagor under the Leases nor shall any such
obligation be imposed upon Mortgagee.
Granting Clause Sixth
Without limiting the generality of the provisions of Granting Clause
Fourth, all of Mortgagor's rights, title, interest, privileges and franchises in
and to the following, now owned or hereafter acquired by Mortgagor, to the
extent of Mortgagor's interest therein and thereto and to the extent assignable
(collectively, "Operating Assets"):
(a) bookings for the use of guest rooms, banquet facilities, meeting rooms
at the Casino Hotel or at any other improvements now or hereafter located on any
of the Land;
(b) all contracts respecting utility services for, and the maintenance,
operations, or equipping of, the Premises, including guaranties and warranties
relating thereto;
(c) the Permits;
(d) all contract rights, leases (whether with respect to real property,
personal property or both real and personal property), concessions, trademarks,
trade names, service marks, logos, copyrights, warranties and other items of
intangible personal property, and any and all good will associated with the
same, relating to the ownership or operation of the Casino Hotel or of any other
improvements now or hereafter located on any of the Land, including, without
limitation, (1) employment contracts with officers and other employees of
Mortgagor, (2) telephone and
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<PAGE>
other communication numbers, (3) all software licensing agreements as are
required to operate computer software systems at the Casino Hotel or at any
other improvements now or hereafter located on any of the Land and books and
records relating to the software programs and (4) Mortgagor's interest under
leases of Tangible Personal Property;
(e) all contracts, purchase orders, requisitions and agreements entered
into by or on behalf of Mortgagor or which have been assigned to Mortgagor, for
the design, construction, and furnishing of the Casino Hotel or of any other
improvements now or hereafter located on any of the Land, including, without
limitation, architect's agreements, engineering agreements, construction
contracts, consulting agreements and agreements or purchase orders for all items
of Tangible Personal Property and payment and performance bonds in favor of
Mortgagor in connection with the Trust Estate (and all warranties and guarantees
thereunder and warranties and guarantees of any subcontractor and bond issued in
connection with the work to be performed by any subcontractor);
(f) the following personal property (the "Tangible Personal Property") now
or hereafter acquired by Mortgagor (directly or by way of lease) which is
located on, or to be located on, or which is in use or held in reserve storage
for future use in connection with the gaming or other operations of, the Casino
Hotel or of any other improvements now or hereafter located on any of the Land,
which is on hand or on order whether stored on-site or off-site:
(i) all furniture, furnishings, equipment, machinery, lighting,
apparatus (both interior and exterior), appliances, fixtures and fittings
and other articles of tangible personal property;
(ii) all slot machines, electronic gaming devices, crap tables,
blackjack tables, poker tables, roulette tables, baccarat tables, big six
wheels and other gaming tables, and all furnishings and equipment to be
used in connection with the operation thereof;
(iii) all cards, dice, gaming chips and plaques, tokens, chip racks,
dealing shoes, dice cups, dice sticks, layouts, paddles, roulette balls
and other consumable supplies and items;
(iv) all china, glassware, linens, kitchen utensils, silverware and
uniforms;
(v) all consumable and operating supplies of every kind and nature,
including, without limitation, accounting supplies, guest supplies, forms,
printing, stationery, food and beverage stock, bar supplies, laundry
supplies and brochures to existing purchase orders;
(vi) all upholstery material, carpets and rugs, beds, bureaus,
chiffonniers, chairs, chests, desks, bookcases, tables, curtains,
hangings, pictures, divans, couches, ornaments, bars, bar fixtures, safes,
stoves, ranges, refrigerators, radios, televisions, clocks; electrical
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<PAGE>
equipment, lamps, mirrors, heating and lighting fixtures and equipment,
ice machines, air conditioning machines, fire prevention and extinguishing
apparatus, laundry machines, and all similar and related articles used in
bedrooms, sitting rooms, bathrooms, boudoirs, halls, closets, kitchens,
dining rooms, offices, lobbies, basements and cellars in the Casino Hotel
and in any other improvements now or hereafter located on any of the Land;
(vii) all sets and scenery, costumes, props and other items of
tangible personal property on hand or on order for use in the production
of shows in any showroom, convention space, exhibition hall, or sports and
entertainment arena of the Casino Hotel or in any other improvements now
or hereafter located on any of the Land; and
(viii) all cars, limousines, vans, buses, trucks and other vehicles
owned or leased by Mortgagor for use in connection with the operation of
the Premises, together with all equipment, parts and supplies used to
service, repair, maintain and equip the foregoing;
(g) all drawings, designs, plans and specifications prepared by
architects, engineers, interior designers, landscape designers and any other
professionals or consultants for the design, development, construction and/or
improvement of the Casino Hotel, or for any other development of the Premises,
as amended from time to time;
(h) any administrative and judicial proceedings initiated by Mortgagor, or
in which Mortgagor has intervened, concerning the Premises, and agreements, if
any, which are the subject matter of such proceedings;
(i) any customer lists utilized by Mortgagor including lists of transient
guests and restaurant and bar patrons and "high roller" lists; and
(j) all of the good will in connection with the assets listed in this
Granting Clause Sixth and in connection with the operation of the Premises.
Except as may be set forth to the contrary herein, the assignment made by
this Granting Clause Sixth shall not impair or diminish any right, privilege or
obligation of Mortgagor with respect to the Operating Assets, nor shall any such
obligation be imposed on Mortgagee.
Granting Clause Seventh
(a) All of Mortgagor's rights, title, interest, privileges and franchises,
if any, in and to all buildings, structures (surface and subsurface), and other
improvements of every kind and description, including, without limitation, all
pedestrian bridges, entrance-ways, parking lots, plazas, curb-cuts, walkways,
driveways and landscaping and such fixtures as constitute real property, now or
hereafter erected or placed on the Land or on any other land or any interest
therein hereafter acquired by Mortgagor and all of Mortgagor's rights, title,
interest, privileges
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<PAGE>
and franchises in and to all fixtures and articles of personal property now or
hereafter attached to or contained in and used in connection with such buildings
and improvements, including, without limitation, all apparatus, furniture,
furnishings, lighting equipment, electronic billboards, machinery, motors,
elevators, fittings, radiators, cooking ranges, ice boxes, ice machines,
printing presses, mirrors, bars, mechanical refrigerators, furnaces, coal and
oil burning apparatus, wall cabinets, machinery, generators, partitions, steam
and hot water boilers, lighting and power plants, pipes, plumbing, radiators,
sinks, bath tubs, water closets, gas and electrical fixtures, awnings, shades,
screens, blinds, dishwashers, freezers, vacuum cleaning systems, office
equipment and other furnishings, and all plumbing, heating, lighting, cooking,
laundry, ventilating, incinerating, air-conditioning and sprinkler equipment or
other fire prevention or extinguishing apparatus and material, and fixtures and
appurtenances thereto; and all renewals or replacements thereof or articles in
substitution therefor, whether or not the same are or shall be attached to the
Land, any other land or any interest therein hereafter acquired by Mortgagor or
to any such buildings and improvements thereon, in any manner.
(b) All of Mortgagor's rights, title, interest, privileges and franchises
in and to all other property, real, personal or mixed (other than Excepted
Property), of every kind and description and wheresoever situate, now owned or
which may be hereafter acquired by Mortgagor, it being the intention hereof that
all property, interests, rights, privileges and franchises now owned by
Mortgagor or acquired by Mortgagor after the date hereof (other than Excepted
Property) shall be as fully embraced within and subjected to the lien hereof as
if such property were specifically described herein.
* * *
TOGETHER with all of Mortgagor's right, title and interest in and to any
and all mineral and water rights and any title or reversion, in and to the beds
of the ways, streets, avenues and alleys adjoining the Premises to the center
line thereof and in and to all strips, gaps and gores adjoining the Premises on
all sides thereof; and
TOGETHER with any and all of Mortgagor's right, title and interest in and
to the tenements, hereditaments, easements, appurtenances, passages, waters,
water courses, riparian rights, other rights, liberties and privileges thereof
or in any way now or hereafter appertaining to the Premises, including, without
limitation, any other claim at law or in equity as well as any after-acquired
title, franchise or license and the reversion and reversions and remainder and
remainders thereof; and
TOGETHER with any and all awards and other compensation heretofore or
hereafter to be made to the present and all subsequent owners of the Trust
Estate for any taking by eminent domain, either permanent or temporary, of all
or any part of the Trust Estate or any easement or appurtenances thereof,
including severance and consequential damage and change in grade of streets, all
in accordance with and subject to the provisions of the Superior Instrument
Requirements and Section 5.17; and
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<PAGE>
TOGETHER with any and all proceeds of any unearned premiums on any
insurance policies described in Section 5.10, and the right to receive and apply
the proceeds of any insurance, judgments, or settlements made in lieu thereof,
for damage to the Trust Estate or otherwise, all in accordance with and subject
to the provisions of Section 5.10 and the Superior Instrument Requirements; and
TOGETHER with all proceeds of every kind and nature, and all products of
every kind and nature, of any of the foregoing property, rights, title,
interests, privileges, franchises and other assets described in Granting Clauses
First through Seventh or in any of the other clauses thereafter.
The foregoing shall include, whether or not specifically identified in one
or more instances, all such property, rights, title, interests, privileges,
franchises and other assets now owned and/or hereafter existing.
EXCLUDING, with respect to all of the hereinabove granted property,
rights, title, interest, privileges and franchises described in Granting Clauses
First through Seventh or in the six immediately preceding paragraphs, all
Excepted Property now or hereafter existing.
TO HAVE AND TO HOLD all of said Premises, Leases, Facility Leases,
Operating Assets, properties, options, credits, deposits, rights, privileges and
franchises of every kind and description, real, personal or mixed, hereby and
hereafter granted, bargained, sold, aliened, assigned, transferred,
hypothecated, pledged, released, conveyed, mortgaged, or confirmed as aforesaid,
or intended, agreed or covenanted so to be, together with all the appurtenances
thereto appertaining (said Premises, Leases, Facility Leases, Operating Assets,
properties, options, credits, deposits, rights, privileges and franchises, other
than Excepted Property now or hereafter existing, being herein collectively
called the "Trust Estate") unto Mortgagee and its successors and assigns
forever.
PROVIDED, HOWEVER, that the lien of this Senior Guarantee Mortgage upon
the Trust Estate shall rank pari passu with the lien of the Senior Note
Mortgage, the lien of the Senior TCHI Note Guarantee Mortgage, the lien of the
Senior Partnership Upstream Mortgage and the lien of any other Working Capital
Facility Mortgage.
BUT IN TRUST, NEVERTHELESS, for the ratable benefit and security of the
Holders.
UPON CONDITION that, until the happening of an Event of Default, Mortgagor
shall be permitted to possess and use the Trust Estate, and to receive and use
the rents, issues, profits, revenues and other income of the Trust Estate.
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<PAGE>
AND IT IS HEREBY COVENANTED AND DECLARED that the Trust Estate is to be
held and applied by Mortgagee, subject to the further covenants, conditions and
trusts hereinafter set forth, and Mortgagor does hereby covenant and agree to
and with Mortgagee, for the ratable benefit of the Holders, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
Section 1.1. Definitions.
For all purposes of this Senior Guarantee Mortgage, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article One have the meanings assigned to
them in this Article One and include the plural as well as the singular;
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them, and all computations herein provided for shall be made, in
accordance with generally accepted accounting principles in effect on the date
hereof consistently applied; and
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Senior Guarantee Mortgage as a whole and not to any
particular Article, Section or other subdivision.
"Affiliate" has the meaning set forth in Section 1.1 of the Senior Note
Indenture.
"Alterations" has the meaning set forth in Section 5.11.
"Appraised Value" means the fair market value of the Casino Hotel, and of
all other property now or hereafter owned or leased by Mortgagor and subject to
the lien of this Senior Guarantee Mortgage, as determined by an Independent
Appraiser on the basis of an appraisal in conformity with the criteria set forth
at 12 C.F.R. ss. 564.4 or such similar published policy or regulation as from
time to time governs real estate related transactions by institutions regulated
by the Office of Thrift Supervision; provided, that the value of the Casino
Hotel and such other property shall not include the value of (i) any furniture,
fixtures and equipment therein to the extent of the Outstanding Amount of any
Indebtedness secured by any F,F&E Financing Agreements with respect thereto and
(ii) any Excepted Property.
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"Appraiser" means a "state certified appraiser" as defined in 12 C.F.R.
ss. 564.2(i) who is (i) of recognized standing among appraisers of properties
similar to the Casino Hotel and (ii) experienced in the appraisals of properties
of a similar size and scope to that of the Casino Hotel, selected by Mortgagor.
"Architect" means an Independent Person selected by Mortgagor and licensed
as an architect in the State of New Jersey.
"Casino" means that portion of the Casino Hotel used for gaming and
related activities.
"Casino Hotel" means the casino and hotel complex currently known as the
"Trump Marina Hotel Casino" in Atlantic City, New Jersey, and ancillary
structures and facilities located on the Premises (other than the property
covered by the Marina Lease) and all furniture, fixtures and equipment at any
time contained therein in each case owned by or leased to Mortgagor and covered
by the lien of the Senior Note Mortgage.
"Casualty" means any act or occurrence of any kind or nature which results
in damage, loss or destruction to any buildings or improvements on the Premises
and/or Tangible Personal Property.
"Certificate of Appraised Value" means the certificate of an Independent
Appraiser stating the Appraised Value.
"Code" means the Federal Bankruptcy Code, Title 11 of the United States
Code, as amended.
"Company" means Trump's Castle Funding, Inc., a corporation incorporated
under the laws of the State of New Jersey, or any other obligor on the Senior
Notes (other than Mortgagor).
"Comparable Provision" has the meaning set forth in Section 5.18.
"Default" means any event which is, or after notice or lapse of time or
both would be, an Event of Default. Without limiting the generality of the
previous provisions of this definition, the term "Default" shall include the
occurrence of an event as to which a notice of default has been given to
Mortgagor under any Facility Lease by a Lessor which has not yet been cured.
"Event of Default" has the meaning set forth in Section 3.1.
"Excepted Property" means:
(1) the personal property owned by lessees under Leases and the personal
property of any Hotel guests;
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<PAGE>
(2) trade names, intellectual property rights and other rights and
interests in and to the use of the terms "Trump's Castle," "Trump," "Trump's
Castle Casino Resort", "Trump Marina Hotel Casino", "Trump Marina", "Donald J.
Trump," "Donald Trump" or related variations thereof;
(3) any property deemed to be Excepted Property pursuant to the provisions
of Section 2.3;
(4) counterchecks, cash and any other property to the extent that the
granting of a security interest therein is prohibited by the New Jersey Casino
Control Act and the regulations promulgated thereunder;
(5) any property acquired pursuant to secured purchase - money
indebtedness permitted under clause "h"of the definition of "Permitted
Indebtedness" in the Senior Note Indenture; and
(6) all equity interests in any Person now owned or hereafter acquired by
Mortgagor (including, without limitation, the capital stock of the Company)
which are required to be pledged under the indenture (as the same may be
amended, modified, supplemented or restated) relating to the 15 1/2% senior
secured notes due 2005 of Trump Hotels & Casino Resorts Holdings, L.P. and Trump
Hotels & Casino Resorts Funding, Inc.
"Existing Encumbrances" means the matters set forth in Schedule 3 hereto.
"Facility Leases" means, collectively:
(1) the Marina Lease;
(2) Any leases other than Capital Lease Obligations and the Marina Lease
where the Mortgagor is tenant or sub-tenant; provided, however, that the
aggregate fixed rental payments paid or accrued for any period of four
consecutive fiscal quarters commencing after the date hereof under all such
leases (including payments required to be made by the lessee in respect of taxes
and insurance, whether or not denominated as rent), shall not exceed for such
period (a) $2,000,000 or (b) $7,500,000 following the time at which the
Partnership shall have achieved EBITDA for any period of four consecutive
quarters in an amount not less than $45.0 million; provided, further, that the
Mortgagor may designate certain such leases which are not material to the
operations of the Casino Hotel and which have aggregate fixed rental payments
(including payments required to be made by the lessee in respect of taxes and
insurance, whether or not denominated as rent) not exceeding an aggregate of
$300,000 per year to be excluded from the leases covered by this clause (2); and
(3) any and all modifications, extensions and renewals of the leases
described in clauses (1) and (2) above, to the extent the same are permitted
under Section 5.18.
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"F,F&E Financing Agreement" has the meaning set forth in Section 1.1 of
the Senior Note Indenture.
"Full Insurable Value" means the actual replacement cost (excluding the
costs of foundation, footing, excavation, paving, landscaping and other similar,
noninsurable improvements) of the insurable properties in question.
"Holder" has the meaning set forth in Section 1.1 of the Senior Note
Indenture.
"Hotel" means that portion of the Casino Hotel not included within the
Casino.
"Impositions" has the meaning set forth in Section 5.7.
"Indebtedness" has the meaning set forth in Section 1.1 of the Senior Note
Indenture.
"Independent" when used with respect to any specified Person means such a
Person who (i) is in fact independent, (ii) does not have any direct financial
interest or any material indirect financial interest in Mortgagor or in any
other obligor upon the Senior Notes or in any Affiliate of Mortgagor or of such
other obligor and (iii) is not connected with Mortgagor or such other obligor or
any Affiliate of Mortgagor or such other obligor as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing similar
functions. Whenever it is herein provided that any Independent Person's opinion
or certificate shall be furnished to Mortgagee, such opinion or certificate
shall state that the signer has read this definition and that the signer is
Independent within the meaning thereof. A Person who is performing or who has
performed services as an independent contractor to any specified Person shall
not be considered not Independent merely by reason of the fact that such Person
is performing or has performed such services.
"Insurance Amount" has the meaning set forth in Section 5.10(a)(i).
"Insurance Requirements" means all terms of any insurance policy covering
or applicable to the Trust Estate or any part thereof, all requirements of the
issuer of any such policy, and all orders, rules, regulations and other
requirements of the National Board of Fire Underwriters (or any other body
exercising similar functions) applicable to or affecting the Trust Estate or any
part thereof or any use or condition of the Trust Estate or any part thereof.
"Insurance Trustee" means the Trustee or, if the Trustee so elects, any
bank, trust company or insurance company with a net worth in excess of
$100,000,000, designated by the Trustee.
"Insurer" means (i) an insurance company or companies selected by
Mortgagor authorized to issue insurance in the State of New Jersey with an A.M.
Best rating level of A minus or better and an A.M. Best financial size category
of VIII or better or (ii) Lloyds of
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London so long as its financial capacity is not such that prudent owners of
first-class casino and hotel complexes in Atlantic City, New Jersey would be
unwilling to accept Lloyds of London; provided, that with respect to the
insurance required to be maintained pursuant to Section 5.10(a)(i), up to 1.0%
of the total amount of such insurance in excess of the first $10,000,000 thereof
may be maintained with an insurance company or companies not meeting the
foregoing A.M. Best rating level and/or A.M. Best financial size categories; and
provided, further, that Mortgagor shall in all events use commercially
reasonable efforts to obtain insurance issued by insurance companies having an
A.M. Best rating level of better than A minus.
"Land" means, collectively, the Owned Land and the Leased Land.
"Lease" means each lease or sublease (made by Mortgagor, as lessor or
sublessor, as the case may be) of any space in any building or buildings, an
interest in which building or buildings constitutes a part of the Trust Estate,
including every agreement relating thereto or entered into in connection
therewith and every guarantee of the performance and observance of the
covenants, conditions and agreements to be performed by the lessee or sublessee
under any such lease or sublease. For purposes hereof, the term "Lease" shall
include any license agreement, concession agreement or other occupancy
agreement. Notwithstanding the foregoing, the term "Lease" shall not include any
transient room rentals.
"Leased Facilities" means, collectively, the Leased Land and any buildings
and improvements now or hereafter located thereon.
"Leased Land" means, collectively, the Marina Lease and any other land
that is now or hereafter subject to a Facility Lease.
"Legal Requirements" means all laws, statutes, codes, acts, ordinances,
orders, judgments, decrees, injunctions, rules, regulations, permits, licenses,
authorizations, directions and requirements (including, without limitation, the
New Jersey Casino Control Act, the New Jersey Industrial Site Recovery Act and
the New Jersey Spill Compensation and Control Act of 1976) of all governments,
departments, commissions, boards, courts, authorities, agencies, officials and
officers, of governments, federal, state and municipal (including, without
limitation, the New Jersey Department of Environmental Protection, the Atlantic
City Bureau of Investigations, the Division of Gaming Enforcement of the State
of New Jersey, and the Casino Control Commission of the State of New Jersey),
foreseen or unforeseen, ordinary or extraordinary, which now are or at any time
hereafter become applicable to the Trust Estate or any part thereof, or any of
the adjoining sidewalks, or any use or condition of the Trust Estate or any part
thereof, including, without limitation, the use of the Casino Hotel as a gaming
or gambling facility.
"Lessors" means the lessors under the Facility Leases.
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"Marina Lease" means the lease agreement made September 1, 1990 between
the State of New Jersey, as Landlord, and Mortgagor, as tenant, respecting
property known as the Senator Frank S. Farley State Marina, Atlantic City, New
Jersey, being designated as a portion of Block B-4, Lot 11 on the tax map of the
City of Atlantic City, Atlantic County, New Jersey, as more particularly
described on Schedule A appended hereto and made a part hereof, together with
all amendments, restatements, extensions and renewals of said lease agreement, a
memorandum of which Lease was recorded June 2, 1992 in the Atlantic County
Registry of Deeds in Deed Book 5365, Page 211.
"Maturity" when used with respect to any Indebtedness means the date on
which the principal (or any portion thereof) of such Indebtedness becomes due
and payable as therein or herein provided, whether at the Stated Maturity, upon
acceleration, optional redemption, required repurchase, scheduled principal
payment or otherwise.
"Mortgage Debt" has the meaning set forth in Section 1.1 of the Senior
Note Indenture.
"Mortgage Documents" has the meaning set forth in Section 1.1 of the
Mortgage Note Indenture.
"Mortgage Note Indenture" means that certain indenture dated as of
December 28, 1993 among the Company, as issuer, the Mortgagor, as guarantor, and
First Bank National Association (now known as U.S. Bank National Association),
as trustee, as it may be amended from time to time, relating to the Company's
Mortgage Notes.
"Mortgage Notes" means the 11-3/4% Mortgage Notes due 2003 issued by the
Company pursuant to the Mortgage Note Indenture.
"Mortgages" means this Senior Guarantee Mortgage, the Senior Note
Mortgage, the TCHI Note Guarantee Mortgage and the Senior Partnership Upstream
Note Mortgage.
"Mortgagee" has the meaning set forth in the first paragraph of this
instrument and its successors and assigns.
"Mortgagor" means the Person named as "Mortgagor" in the first paragraph
of this instrument until a successor entity shall have become such pursuant to
the applicable provisions of this Senior Guarantee Mortgage, and thereafter,
except to the extent otherwise contemplated by Section 4.2, "Mortgagor" shall
mean such successor entity exclusively.
"Mortgagor Order" and "Mortgagor Request" mean, respectively, a written
order or request signed with a Mortgagor Signature and delivered to Mortgagee.
"Mortgagor Signature" means the signature of the President or a Vice
President of a corporate general partner of Mortgagor or of a general partner of
Mortgagor.
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"Mortgagor's Certificate" means a certificate signed with a Mortgagor
Signature and delivered to Mortgagee.
"Notices" has the meaning set forth in Section 1.2.
"Operating Assets" has the meaning set forth in Granting Clause Sixth.
"Opinion of Counsel" means a written opinion of counsel who may (except as
otherwise expressly provided in this Senior Guarantee Mortgage) be an employee
of Mortgagor or of an Affiliate of Mortgagor.
"Original Policy" means the ALTA Loan Policies of Title Insurance issued
by First American Title Insurance Company, Chicago Title Insurance Company and
Commonwealth Land Title Insurance Company, pursuant to Title Commitment No.
L980366, dated the date hereof.
"Outstanding Amount" has the meaning set forth in Section 1.1 of the
Senior Note Indenture.
"Owned Land" has the meaning set forth in Granting Clause First.
"Permits" means all licenses, franchises, authorizations, statements of
compliance, certificates of operation, certificates of occupancy and permits
required for the lawful ownership, occupancy, operation and use of all or a
material portion of the Premises whether held by Mortgagor or any other Person
(which may be temporary or permanent) (including, without limitation, those
required for the use of the Casino Hotel as a licensed casino facility), in
accordance with all applicable Legal Requirements.
"Permitted Encumbrances" means:
(1) liens for taxes, assessments, or governmental charges not yet due and
payable, or if due and payable not delinquent, to the extent that any fine,
penalty, interest or cost may be added for nonpayment thereof;
(2) Existing Encumbrances;
(3) F,F&E Financing Agreements permitted by the Senior Note Indenture or
the TCHI Note Indenture;
(4) the liens of the Mortgage Documents;
(5) the liens of the Mortgages and any rights granted as provided therein;
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(6) the lien of the Trustee provided for in Section 6.6 of the Senior Note
Indenture and the TCHI Note Indenture and of the trustees under corresponding
sections of the Mortgage Note Indenture and the PIK Note Indenture;
(7) any lien or encumbrance which, under the provisions of Section 5.6,
constitutes a Permitted Encumbrance;
(8) Restricted Encumbrances;
(9) any Working Capital Facility Mortgage (including the TCHI Note
Guarantee Mortgage and the Senior Partnership Upstream Mortgage);
(10) any lien or encumbrance permitted under Section 5.3 of this Mortgage;
(11) any lien or encumbrance securing purchase money indebtedness
permitted by the Senior Note Indenture and the TCHI Note Indenture;
(12) modifications, refinancings, extension, renewals or replacements, in
whole or in part, of the liens described in clauses (2) through (11) of this
definition to the extent permitted by the Senior Note Indenture and the TCHI
Note Indenture; and
(13) any Facility Lease now existing or hereafter entered into.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or any other entity or government or any agency or
political subdivision thereof.
"PIK Note Indenture" means that certain indenture dated as of December 28,
1993 among the Company, as issuer, the Mortgagor, as guarantor, and First Bank
National Association (now known as U.S. Bank National Association), as trustee,
as it may be amended from time to time, relating to the Company's PIK Notes.
"PIK Notes" means the Company's 13 7/8% Pay-in-Kind Notes due 2005.
"Premises" has the meaning set forth in Granting Clause Fourth.
"Restoration" has the meaning set forth in Section 5.10(e)(iii).
"Restricted Encumbrances" means any Leases permitted by and made in
accordance with Section 5.12 of this Senior Guarantee Mortgage.
"Securities Act" has the meaning set forth in Section 1.1 of the Senior
Note Indenture.
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"Senior Assignment Agreement" means the Senior Assignment Agreement of
even date herewith made by the Company, as assignor, to the Trustee, as
assignee, providing for assignment of the Senior Partnership Note and the Senior
Note Mortgage.
"Senior Guarantee" means the guarantee by the Partnership of the Company's
Indenture Obligations (as defined in the Senior Note Indenture) pursuant to
Article 14 of the Senior Note Indenture.
"Senior Guarantee Mortgage" means this Indenture of Mortgage and Security
Agreement, which evidences a lien pari passu with the Senior Note Mortgage, the
lien of TCHI Note Guarantee Mortgage, the lien of the Senior Partnership
Upstream Note Mortgage and the lien of any other Working Capital Facility
Mortgage.
"Senior Indebtedness" means the Indebtedness evidenced by the Senior
Partnership Note, the Senior Guarantee, the Senior Notes and any Working Capital
Facility (including without limitation the TCHI Notes, the Senior Partnership
Upstream Note, the TCHI Guarantee) and any amendments, extensions, renewals,
replacements or restatements of any of the foregoing to the extent permitted by
the Senior Note Indenture and the TCHI Note Indenture.
"Senior Note Indenture" means that certain indenture of even date herewith
among Mortgagor, as guarantor, the Company, as issuer, and the Trustee, as
trustee, relating to the Senior Notes as it may from time to time be
supplemented, modified or amended by one or more trust indentures or other
instruments supplemental thereto entered into pursuant to the applicable
provisions thereof.
"Senior Note Mortgage" means a certain Indenture of Mortgage and Security
Agreement, dated of even date herewith, between the Mortgagor, as
mortgagor/debtor, and the Company, as mortgagee/secured party, securing the
Senior Partnership Note and which evidences a lien pari passu with the lien of
this Mortgage, the lien of the TCHI Note Guarantee Mortgage, the Lien of the
Senior Partnership Upstream Note Mortgage and the lien of any other Working
Capital Facility Mortgage.
"Senior Notes" means the 10 1/4% Senior Secured Notes due 2003 issued by
the Mortgagee under the Senior Note Indenture.
"Senior Partnership Note" means that certain Senior Partnership Note of
even date herewith in the original principal amount of $62,000,000 made by
Mortgagor in favor of the Company, a true copy of which note is attached to the
Senior Note Indenture, and any amendments, extensions, renewals, replacements or
restatements of the same to the extent permitted under the Senior Note
Indenture.
"Senior Partnership Upstream Note" means that certain promissory note of
even date herewith in the original principal amount of $5,000,000 made by the
Mortgagor in favor of
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TCHI, a true copy of which is attached to the TCHI Note Indenture, and any
amendments, extensions, renewals, replacements or restatements of the same to
the extent permitted under the TCHI Note Indenture.
"Senior Partnership Upstream Note Mortgage" means certain Indenture of
Mortgage and Security Agreement, dated of even date herewith, among the
Mortgagor, as mortgagor/debtor, and TCHI, as mortgagee/secured party, securing
the Senior Partnership Upstream Note and which evidences a lien pari passu with
the lien of this Mortgage, the lien of the Senior Note Mortgage, the lien of the
TCHI Note Guarantee Mortgage and the lien of any other Working Capital Facility
Mortgage.
"Settlement Costs" has the meaning set forth in Section 5.17.
"Stated Maturity" when used with respect to any Indebtedness, means the
date specified in such Indebtedness as the fixed date on which the principal of
such Indebtedness is due and payable.
"Superior Instrument Requirements" means the applicable terms, conditions
and provisions of any documentation which constitutes, evidences, secures or
governs any Senior Indebtedness, together with the terms and conditions of the
Marina Lease.
"Taking" means the acquisition or condemnation by eminent domain of the
whole or any part of the Premises, by a competent authority, for any public or
quasi-public use or purpose.
"Tangible Personal Property" has the meaning set forth in subclause (f) of
Granting Clause Sixth.
"TCHI" means Trump's Castle Hotel & Casino, Inc., a corporation
incorporated under the laws of the State of New Jersey, or any other obligor
under the TCHI Notes (other than Mortgagor).
"TCHI Guarantee" means the guarantee by Mortgagor of TCHI's Indenture
Obligations (as defined in the TCHI Note Indenture) pursuant to Article 14 of
the TCHI Note Indenture.
"TCHI Mortgages" means the TCHI Guarantee Mortgage and the Senior
Partnership Upstream Note Mortgage.
"TCHI Note Guarantee Mortgage" means the Indenture of Mortgage and
Security Agreement of even date herewith between U.S. Bank National Association,
as trustee, as mortgagee, and Mortgagor, as mortgagor securing the TCHI
Guarantee and evidencing a lien pari passu with the lien of this Mortgage, the
lien of the Senior Note Mortgage, the lien of the Senior Partnership Upstream
Note Mortgage and the lien of any other Working Capital Facility Mortgage.
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"TCHI Note Indenture" means that certain indenture of even date herewith
among TCHI, as issuer, Mortgagor, as guarantor and U.S. Bank National
Association, as trustee, relating to the TCHI Notes as it may from time to time
be supplemented, modified or amended by one or more trust indentures or other
instruments supplemental thereto entered into pursuant to the applicable
provisions thereof.
"TCHI Notes" means the 10 1/4% Senior Secured Notes due 2003 in the
original principal amount of $5,000,000 issued by TCHI pursuant to the TCHI Note
Indenture.
"Trust Estate" has the meaning stated in the habendum to the Granting
Clauses.
"Trust Indenture Act" has the meaning set forth in Section 1.1 of the
Senior Note Indenture.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of the Senior Note Indenture and any successor thereto,
"Uniform Commercial Code" means the New Jersey Uniform Commercial Code
N.J.S.A. 12A:1-101, et seq.
"Working Capital Facility" has the meaning set forth in Section 1.1 of the
Senior Note Indenture.
"Working Capital Facility Mortgage" any mortgage or other security
interest or agreement (including, without limitation the TCHI Note Guarantee
Mortgage and the Senior Partnership Upstream Note Mortgage)) which secures a
Working Capital Facility and which evidences a lien pari passu with the lien of
the Senior Note Mortgage, the lien of this Mortgage, the lien of the TCHI Note
Guarantee Mortgage and the lien of the Senior Partnership Upstream Note
Mortgage.
Section 1.2. Notices.
(a) Any request, demand, authorization, direction, notice (including,
without limitation, a notice of default), consent, waiver or other document
provided or permitted by this Senior Guarantee Mortgage to be made upon, given
or furnished to, or filed with, Mortgagor, Mortgagee or the Trustee
(collectively, "Notices") shall be in writing and shall be deemed given either
(i) when delivered by hand (including by overnight courier) or (ii) two days
after sending by registered or certified mail, postage prepaid, addressed as
follows:
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To Mortgagor:
Trump's Castle Associates, L.P.
Trump Marina Hotel Casino
Brigantine Boulevard and Huron Avenue
Atlantic City, New Jersey 08401
Attn: Chief Financial Officer
and and after May 26, 1998:
Willkie Farr & Gallagher Willkie Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, NY 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
To Mortgagee:
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Administration
(b) By Notice to Mortgagor or Mortgagee either party may designate
additional or substitute addresses for Notices which, notwithstanding Subsection
(a) above, shall be deemed given when received.
Section 1.3. Form and Contents of Documents Delivered to Mortgagee.
Whenever several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other such matters in one or several documents.
Any certificate or opinion of a general partner of Mortgagor may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such general partner knows that the
certificate or opinion or representations with respect to the matters upon which
his certificate or opinion is based are erroneous. Any Opinion of Counsel may be
based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, a general partner of Mortgagor stating that the
information with respect to such factual matters is in the possession of
Mortgagor, unless such counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous. If appropriate
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to the matter being opined upon and to the extent not prohibited by the Trust
Indenture Act, conclusions stated in any Opinion of Counsel may be subject to
rights of creditors and the availability of equitable remedies.
Whenever any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Senior Guarantee Mortgage, they may, but need not, be
consolidated to form one instrument.
Whenever in this Senior Guarantee Mortgage, in connection with any
application or certificate or report to Mortgagee, it is provided that Mortgagor
shall deliver any document as a condition of the granting of such application,
or as evidence of Mortgagor's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of Mortgagor to have such application granted or to the
sufficiency of such certificate or report.
Every application, certificate, report, affidavit, opinion, consent,
statement or other instrument required to be delivered to Mortgagee under this
Senior Guarantee Mortgage or under any other Mortgage Document shall be in
writing and shall be prepared and delivered without cost or expense to
Mortgagee.
Section 1.4. Compliance Certificates and Opinions.
Upon any application or request by Mortgagor to Mortgagee to take any
action under any provision of this Senior Guarantee Mortgage, Mortgagor shall
furnish to Mortgagee a Mortgagor's Certificate stating that all conditions
precedent, if any, provided for in this Senior Guarantee Mortgage relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Senior Guarantee Mortgage relating to such particular
application or request, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Senior Guarantee Mortgage shall include:
(a) a statement that each individual signing such certificate or opinion
has read such condition or covenant and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such condition or covenant has been
complied with; and
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(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 1.5. Effect of Headings and Table of Contents.
The Article and Section headings herein and in the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 1.6. Successors and Assigns; Amendments.
(a) Subject to the provisions of Sections 1.10 and 4.2 hereof and Sections
3.11 and 8.2 of the Senior Note Indenture, this Senior Guarantee Mortgage shall
be binding upon and inure to the benefit of the parties hereto and of the
respective successors and assigns of the parties hereto to the same effect as if
each such successor or assign were in each case named as a party to this Senior
Guarantee Mortgage.
(b) This Senior Guarantee Mortgage may not be modified, amended,
discharged, released nor any of its provisions waived except by agreement in
writing executed by Mortgagor and Mortgagee and in accordance with the
provisions of this Senior Guarantee Mortgage and the Senior Note Indenture.
Section 1.7. Separability Clause.
In case any provision in this Senior Guarantee Mortgage shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 1.8. Benefits of Mortgage.
Without limiting the generality of Section 3.12, nothing in this Senior
Guarantee Mortgage, or in the Senior Notes, express or implied, shall give to
any Person, other than the parties hereto and their successors and assigns, any
benefit or any legal or equitable right, remedy or claim under this Senior
Guarantee Mortgage.
Section 1.9. Governing Law.
This Senior Guarantee Mortgage shall be deemed to be a contract under the
laws of the State of New Jersey and shall be construed in accordance with and
governed by the laws of the State of New Jersey.
Section 1.10. Limitation on Liability.
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Notwithstanding anything herein or in any other agreement, document,
certificate, instrument, statement or omission referred to below to the
contrary, Mortgagor is liable hereunder only to the extent of the assets of
Mortgagor and no other person or entity, including, without limitation, any
partner, officer, committee or committee member of Mortgagor or any partner
therein or in any partnership Affiliate of Mortgagor, or any incorporator,
officer, director or shareholder of any corporate partner of Mortgagor or of any
corporate Affiliate of Mortgagor, or any Affiliate or controlling person or
entity of any of the foregoing, or any agent, employee, or lender of any of the
foregoing, or any successor, personal representative, heir or assign of any of
the foregoing, in each case past, present or as they may exist in the future,
shall be liable in any respect (including, without limitation, the breach of any
representation, warranty, covenant, agreement, condition or indemnification or
contribution undertaking contained herein or therein) under, in connection with,
arising out of or relating to this Senior Guarantee Mortgage, or any other
agreement, document, certificate, instrument or statement (oral or written)
related to, executed or to be executed, delivered or to be delivered, or made or
to be made, or any omission made or to be made, in connection with any of the
foregoing or any of the transactions contemplated in any such agreement,
document, certificate, instrument, or statement. Any agreement, document,
certificate, statement or other instrument to be executed simultaneously with,
in connection with, arising out of or relating to this Senior Guarantee Mortgage
or any other agreement, document, certificate, statement or instrument referred
to above, or any agreement, document, certificate, statement or instrument
contemplated hereby shall contain language mutatis mutandis to this Section 1.10
and, if such language is omitted, shall be deemed to contain such language.
Section 1.11. Provisions Required by Senior Note Indenture.
Whenever the provisions of this Senior Guarantee Mortgage and the
provisions of the Senior Note Indenture shall be inconsistent, the provisions of
the Senior Note Indenture shall govern.
Section 1.12. Rights of Trustee as Mortgagee.
Except as otherwise provided in Section 6.2 of the Senior Note Indenture:
(1) Mortgagee may rely, and shall be protected in acting or
refraining from acting, upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(2) any request or direction of Mortgagor mentioned herein shall be
sufficiently evidenced by a Mortgagor Request or Mortgagor Order;
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(3) whenever in the administration of this Senior Guarantee
Mortgage, Mortgagee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder,
Mortgagee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon a Mortgagor's
Certificate;
(4) Mortgagee may consult with counsel and any written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by Mortgagee hereunder in good faith and in reliance thereon;
(5) Mortgagee shall be under no obligation to exercise any of the
rights or powers vested in it by this Senior Guarantee Mortgage at the
request or direction of any of the Holders pursuant to the Senior Note
Indenture, unless such Holders shall have offered to Mortgagee reasonable
security or indemnity against the costs, expenses and liabilities which
might be incurred therein or thereby in compliance with such request or
direction;
(6) Mortgagee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, appraisal, bond, debenture, note, coupon, security or other
paper or document but Mortgagee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit,
and, if Mortgagee shall determine to make such further inquiry or
investigation, it shall be entitled (subject to the express limitations
with respect thereto contained in this Senior Guarantee Mortgage) to
examine the books, records and premises of Mortgagor, personally or by
agent or attorney;
(7) Mortgagee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys, and Mortgagee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder;
(8) Mortgagee shall not be personally liable, in case of entry by it
upon the Trust Estate, for debts contracted or liabilities or damages
incurred in the management or operation of the Trust Estate;
(9) Mortgagor shall pay or cause to be paid to the Trustee all
compensation and other amounts provided in Section 6.6 of the Senior Note
Indenture; and
(10) no provision of this Senior Guarantee Mortgage shall require
Mortgagee to expend or risk its own funds or otherwise incur any financial
liability in the performance of its obligations hereunder, or in the
exercise of any of its rights or powers.
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Section 1.13. Mortgage Subject to Casino Control Act.
Each provision of this Senior Guarantee Mortgage is subject to and shall
be enforced in compliance with the provisions of the New Jersey Casino Control
Act.
Section 1.14. Discharge of Lien.
If (a) Mortgagor shall pay or cause to be paid, or there shall otherwise
be paid, to Mortgagee all amounts required to be paid by Mortgagor pursuant to
this Senior Guarantee Mortgage, the Senior Notes and the Senior Guarantee and
the conditions precedent for the Senior Note Indenture to cease, determine and
become null and void (except for any surviving rights of transfer or exchange of
the Senior Notes provided in Section 13.1 of the Senior Note Indenture and for
the obligation to pay the Trustee's fees and expenses provided in Section 6.6 of
the Senior Note Indenture) in accordance with Section 13.1 of the Senior Note
Indenture shall have occurred, or (b) there shall have occurred a "defeasance"
(as defined in Section 4.2 of the Senior Note Indenture) of the Senior Notes, or
(c) there shall have occurred a "covenant defeasance" (as defined in Section 4.3
of the Senior Note Indenture), then in any such case Mortgagee shall promptly
cancel and discharge this Senior Guarantee Mortgage, and any financing
statements filed in connection herewith and execute and deliver to Mortgagor all
such instruments as may be necessary, required or appropriate to evidence such
discharge and satisfaction of said lien or liens.
Section 1.15. General Application.
(a) The remedies of Mortgagee upon any default by Mortgagor in the
fulfillment of any of its obligations hereunder shall be limited in each
instance by the provisions of Section 1.10, whether or not the provisions
providing for such remedies explicitly refer to such Section.
(b) The assertion of any rights upon any Default shall be subject in each
instance to, if required, the giving of any notice and the expiration of any
grace period provided for in Section 3.1 as a condition to such Default becoming
an Event of Default, unless the Trust Indenture Act requires otherwise, in which
case the Trust Indenture Act shall control.
(c) For the purposes of this Senior Guarantee Mortgage, it is understood
that an event which does not materially diminish the value of Mortgagee's
interest in the Trust Estate shall not be deemed an "impairment of security," as
that phrase is used in this Senior Guarantee Mortgage.
Section 1.16. Senior Guarantee Mortgage Deemed to be Security Agreement.
To the extent that the grant of a security interest in any portion of the
Trust Estate is governed by the Uniform Commercial Code, this Senior Guarantee
Mortgage is hereby deemed to be as well a security agreement under the Uniform
Commercial Code for the purpose of
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creating hereby a security interest in all of Mortgagor's right, title and
interest in and to said property, securing the obligations secured hereby, for
the benefit of Mortgagee.
Section 1.17. No Duplication of Notices or Payments.
Whenever it is provided in this Senior Guarantee Mortgage and the Senior
Note Mortgage that Mortgagor shall deliver any notice or document, or is
required to make any payment, the delivery of such notice or document or the
making of such payment shall constitute the delivery of such notice or document
or the making of such payment in satisfaction of the terms, conditions and
provisions of this Senior Guarantee Mortgage and the Senior Note Mortgage
provided that such notice, document or payment states, or is accompanied by a
letter stating, that such notice, document or payment is being delivered in
satisfaction of the terms, conditions and provisions of this Senior Guarantee
Mortgage and the Senior Note Mortgage.
ARTICLE TWO
RELEASE; SUBORDINATION
Section 2.1. Possession by Mortgagor.
So long as there shall have been no acceleration of maturity of the Senior
Notes, Mortgagor shall be suffered and permitted, with power freely and without
let or hindrance on the part of Mortgagee, subject to the provisions of this
Senior Guarantee Mortgage and the Senior Note Indenture, to possess, use,
manage, operate and enjoy the Trust Estate and every part thereof and to
collect, receive, use, invest and dispose of the rents, issues, tolls, profits,
revenues and other income from the Trust Estate or any part thereof, to use,
consume and dispose of any consumable, goods, wares and merchandise in the
ordinary course of business of operating the Casino Hotel and to adjust and
settle all matters relating to choses in action, leases and contracts.
Section 2.2. Obsolete Property.
Mortgagor shall have the right, at any time and from time to time, unless
an Event of Default shall have occurred and be continuing, without any release
from or consent by Mortgagee:
(a) to sell or dispose of, free from the lien of this Senior Guarantee
Mortgage, any Tangible Personal Property which, in its reasonable opinion, may
have become obsolete or unfit for use or which is no longer necessary in the
conduct of its businesses or the operation of the Trust Estate, and no purchaser
of any such property shall be bound to inquire into any question affecting
Mortgagor's right to sell or otherwise dispose of the same free from the lien of
this Senior Guarantee Mortgage;
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(b) to alter, repair, replace, change the location or position of and add
to any Tangible Personal Property; provided, however, that no change shall be
made in the location of any such property subject to the lien of this Senior
Guarantee Mortgage which would in any respect impair the security of this Senior
Guarantee Mortgage upon such property; or
(c) to renew, extend, surrender, terminate, modify or amend any leases of
Tangible Personal Property, when, in Mortgagor's reasonable opinion, it is
prudent to do so.
Mortgagor shall retain any net cash proceeds received from the sale or
disposition of any Tangible Personal Property under Subsection (a) of this
Section 2.2, in the business of operating the Casino Hotel.
Mortgagee shall be under no responsibility or duty with respect to the
exercise of the rights of Mortgagor under this Section 2.2 or the application of
the proceeds of any sale or disposition of any Tangible Personal Property.
Mortgagee shall, from time to time, promptly execute any written instrument in
form satisfactory to Mortgagee to confirm the propriety of any action taken by
Mortgagor under this Section 2.2, upon receipt by Mortgagee of a Mortgagor
Request requesting the same, together with a Mortgagor's Certificate stating
that the action so to be confirmed was duly taken in conformity with this
Section 2.2, and that the execution of such written instrument is appropriate to
confirm the propriety of such action under this Section 2.2; provided, that
Mortgagee shall have no liability thereunder and all costs and expenses
(including, without limitation, reasonable attorneys' fees and disbursements)
shall be paid by Mortgagor.
Section 2.3. F,F&E Financing Agreements.
Notwithstanding any provision contained in this Senior Guarantee Mortgage
or the Senior Note Indenture to the contrary, if Mortgagor acquires Tangible
Personal Property and/or other items constituting operating assets subject to
any F,F&E Financing Agreement, or becomes the lessee under a lease for any of
the same and if the document evidencing such F,F&E Financing Agreement prohibits
subordinate liens or the provisions of any such lease prohibits any assignment
thereof by the lessee, and if any such prohibition is customary with respect to
similar transactions of the lender or lessor (as evidenced by a Mortgagor's
Certificate delivered to Mortgagee, together with such other evidence as
Mortgagee may reasonably request), as the case may be, then the property so
purchased or the lessee's interest in the lease, as the case may be, shall be
deemed to be Excepted Property. If any such F,F&E Financing Agreement permits
subordinate liens, then Mortgagee shall execute and deliver to Mortgagor, at
Mortgagor's expense, such documents as the holder of such F,F&E Financing
Agreement may reasonably request to evidence the subordination of the lien of
this Senior Guarantee Mortgage and the Mortgage Documents to the lien of such
F,F&E Financing Agreement; provided, however, that Mortgagee shall have no
obligation to execute and deliver such documents, and the lien of this Senior
Guarantee Mortgage shall not be subordinate to any such F,F&E Financing
Agreement,
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unless (a) such F,F&E Financing Agreement shall contain a provision binding upon
the holder of such F,F&E Financing Agreement that (i) if the holder of such
F,F&E Financing Agreement shall give to Mortgagor any notice of default
thereunder, such holder shall at the same time and in the same manner serve a
copy of such notice on Mortgagee at the address designated herein (or such other
address as Mortgagee may designate by notice given to the holder of such F,F&E
Financing Agreement in the manner provided for notices hereunder), and that no
such notice to Mortgagor shall be deemed to have been duly given unless and
until a copy thereof has been so provided to Mortgagee, and (ii) promptly
following the last date upon which Mortgagor may cure such default, if Mortgagor
shall fail to cure such default, the holder of such F,F&E Financing Agreement
shall give notice to Mortgagee stating the manner in which Mortgagor shall have
failed to cure its said default, in which event Mortgagee shall be permitted to
cure the default and, with respect thereto, Mortgagee shall have the same amount
of time, after such notice, within which to cure the said default, as is
provided for under the provisions of such F,F&E Financing Agreement to be given
to Mortgagor therefor after notice or (b) Mortgagor delivers to Mortgagee a
Mortgagor's Certificate certifying that (i) the provision described in clause
(a) is not customarily included by the lender or lessor in its F,F&E Financing
Agreements in similar transactions and (ii) although Mortgagor has used
reasonable efforts to have included in such F,F&E Financing Agreement such a
provision, Mortgagor has been unsuccessful in obtaining such a provision.
ARTICLE THREE
REMEDIES
Section 3.1. Events of Default.
"Event of Default," whenever used herein, means any one of the following
events (including any applicable notice requirement and any period of grace, as
specified in this Section 3.1) (whatever the reason for such event and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) default in the payment of any interest on the Senior Notes or the
Senior Partnership Note when such interest becomes due and payable and
continuance of such default for a period of 30 days; or
(b) default in the payment of all or any portion of the principal of (or
premium, if any, on) the Senior Partnership Note, or the Senior Notes when the
same becomes due and payable at its Maturity; or
(c) default in the payment of any other sum due under the Senior Notes or
this Senior Guarantee Mortgage, and the continuance of such default for a period
of 30 days after there has
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been given to Mortgagor a notice specifying such default and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder; or
(d) default in the payment or performance of any obligation under the
Senior Guarantee at the time such payment or performance is required under
Article Fourteen of the Senior Note Indenture; or
(e) default in the performance, or breach, of any covenant of Mortgagor in
this Senior Guarantee Mortgage (other than a covenant, a default in the
performance or breach of which is elsewhere in this Section 3.1 specifically
dealt with), and continuance of such default or breach for a period of 30 days
after there has been given to Mortgagor a notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder, unless (i) the default or breach is of such a nature that
is curable but not susceptible of being cured with due diligence within such
30-day period (for reasons other than the lack of funds), (ii) Mortgagor
delivers a Mortgagor's Certificate to Mortgagee within such 30-day period
stating (A) the applicability of the provisions of clause (i) to such default or
breach, (B) Mortgagor's intention to remedy such default or breach with
reasonable diligence and (C) the steps which Mortgagor has undertaken or intends
to undertake to remedy such default or breach and (iii) Mortgagor delivers to
Mortgagee additional Mortgagor's Certificates every 30 days thereafter updating
the information contained in the certificate described in clause (ii), in which
case such 30-day period shall be extended for such further period of time (but
in no event more than 60 days after the last day of such 30-day period) as may
reasonably be required to cure the same, provided that Mortgagor is then
proceeding and thereafter continues to proceed to cure the same with reasonable
diligence; or
(f) an "Event of Default," as defined in Section 5.1 of the Senior Note
Indenture, shall occur and be continuing; or
(g) default by Mortgagor under any of the terms of any Facility Lease
which shall not be fully cured or waived prior to the expiration of any grace
period (as such grace period may be extended) contained in such Facility Lease;
or
(h) default in the performance, or breach, of any of the provisions of
Article Four hereof; or
(i) if any representation or warranty of Mortgagor set forth in this
Senior Guarantee Mortgage or in any notice, certificate, demand or request
delivered to Mortgagee pursuant to this Senior Guarantee Mortgage shall prove to
be incorrect in any material respect as of the time when made; or
(j) an "Event of Default" as defined in Section 3.1 of the Senior Note
Mortgage, the TCHI Note Guarantee Mortgage, the Senior Partnership Upstream Note
Mortgage or the Mortgage Documents shall occur and be continuing.
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An Event of Default shall not be deemed to exist by reason of any event
which Mortgagor is contesting in compliance with the provisions of Section 5.8.
Section 3.2. Acceleration of Maturity; Recision and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(g) or (h) of the Senior Note Indenture) occurs and is continuing,
then, and in every such case, Mortgagee may declare the Outstanding Amount of
the Senior Notes to be due and payable immediately, by a notice in writing to
Mortgagor and upon any such declaration such principal shall become immediately
due and payable. If an Event of Default specified in such Section 5.1(g) or (h)
occurs, the Outstanding Amount of the Senior Notes shall ipso facto become due
and payable without any declaration or other act on the part of the Mortgagee.
If at any time after such declaration of acceleration has been made, but
before any judgment or decree for payment of money due on the Senior Notes has
been obtained by the Mortgagee, such declaration of acceleration and its
consequences has been duly rescinded and annulled in accordance with Section 5.2
of the Senior Note Indenture, then the declaration of acceleration pursuant to
this Section 3.2 shall automatically be rescinded and annulled.
No such rescission and annulment shall affect any subsequent default or
impair any right consequent thereon.
Section 3.3. Application of Moneys Received by Mortgagee.
Any moneys received by Mortgagee pursuant to the provisions of this
Article Three (including moneys received by the Trustee after any action or act
by Mortgagee under Section 3.10) shall be applied by Mortgagee in accordance
with the provisions of Section 5.6 of the Senior Note Indenture.
Section 3.4. Restoration of Rights and Remedies.
If Mortgagee has instituted any proceeding to enforce any right or remedy
under this Senior Guarantee Mortgage and such proceeding has been discontinued
or abandoned for any reason or has been determined adversely to Mortgagee, then
and in every such case Mortgagor and Mortgagee shall, subject to any
determination in such proceeding, be restored to their respective former
positions hereunder, and thereafter all rights and remedies of Mortgagee shall
continue as though no such proceeding had been instituted.
Section 3.5. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to Mortgagee is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or
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hereafter existing at law or in equity or otherwise. The assertion or employment
of any right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 3.6. Delay or Omission Not Waiver.
No delay or omission of Mortgagee to exercise any right or remedy accruing
upon an Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right and
remedy given by this Article Three or by applicable law to Mortgagee may be
exercised, from time to time, and as often as may be deemed expedient, by
Mortgagee. Section
3.7. Undertaking for Costs.
If any action or proceeding shall be commenced (including, without
limitation, an action to foreclose this Senior Guarantee Mortgage or to collect
the indebtedness secured hereby) to which action or proceeding Mortgagee is made
or becomes a party, or in which it becomes necessary in the opinion of Mortgagee
to defend or uphold the lien of this Senior Guarantee Mortgage, Mortgagor shall
pay to Mortgagee all expenses, including, without limitation, reasonable
attorneys' fees, disbursements and court costs incurred by Mortgagee in
connection therewith, together with interest at the rate then payable on the
Senior Notes, from the date of payment less the net amount received by
Mortgagee, as its interests may appear under any title insurance policy, and,
until paid, all such expenses, together with interest as aforesaid, shall be
secured by the lien of this Senior Guarantee Mortgage.
Section 3.8. Waiver of Appraisement and Other Laws.
To the full extent that it may lawfully so agree, Mortgagor will not at
any time insist upon, plead, claim or take the benefit or advantage of, any
appraisement, valuation, stay, extension or redemption law now or hereafter in
force, in order to prevent or hinder the enforcement of this Senior Guarantee
Mortgage or the absolute sale of the Trust Estate, or any part thereof, or the
possession thereof by any purchaser at any sale under this Article Three; and
Mortgagor, for itself and all who may claim under Mortgagor, so far as Mortgagor
or they now or hereafter may lawfully do so, hereby waives the benefit of all
such laws. Mortgagor, for itself and all who may claim under Mortgagor, waives,
to the extent that Mortgagor may lawfully do so, all right to have the property
in the Trust Estate marshaled upon any foreclosure hereof, and agrees that any
court having jurisdiction to foreclose this Senior Guarantee Mortgage may order
the sale of the Trust Estate as an entirety.
If any law in this Section 3.8 referred to and now in force, of which
Mortgagor or its successor or successors might take advantage despite this
Section 3.8, shall hereafter be repealed or cease to be in force, such law shall
not thereafter be deemed to constitute any part of the contract herein contained
or to preclude the application of this Section 3.8.
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Section 3.9. Entry.
Mortgagor agrees that upon the occurrence, and during the continuance, of
an Event of Default, Mortgagor, upon demand of Mortgagee, shall forthwith
surrender to Mortgagee the actual possession of, and it shall be lawful for
Mortgagee by such officers or agents as it may appoint to enter and take
possession of, the Trust Estate (and the books and papers of Mortgagor), and to
hold, operate and manage the Trust Estate (including the making of all needful
repairs, and such alterations, additions and improvements as Mortgagee shall
deem wise) and to receive the rents, issues, tolls, profits, revenues and other
income thereof, and, after deducting the costs and expenses of entering, taking
possession, holding, operating and managing the Trust Estate, as well as
payments for taxes, insurance and other proper charges upon the Trust Estate and
reasonable compensation to itself, its agents and counsel, to apply the same as
provided in Section 3.3; provided, however, that Mortgagee's rights under this
Section 3.9 shall be subject to the provisions of the New Jersey Casino Control
Act and Section 3.14. Whenever all that is then due upon the Senior Notes and
under any of the terms of the Senior Guarantee, this Senior Guarantee Mortgage
shall have been paid and all defaults hereunder shall have been cured, Mortgagee
shall surrender possession to Mortgagor.
Section 3.10. Power of Sale; Suits for Enforcement.
If an Event of Default shall occur and be continuing, Mortgagee, with or
without entry, in its discretion, may:
(a) sell, subject to any mandatory requirements of applicable law, the
Trust Estate as an entirety, or in such parcels, as Mortgagee may determine, to
the highest bidder at public auction at such place and at such time (which sale
may be adjourned by Mortgagee from time to time in its discretion by
announcement at the time and place fixed for such sale, without further notice)
and upon such terms as Mortgagee may fix and briefly specify in a notice of sale
to be published as required by law; or
(b) proceed to protect and enforce its rights under this Senior Guarantee
Mortgage by sale pursuant to judicial proceedings or by a suit, action or
proceeding in equity or at law or otherwise, whether for the specific
performance of any covenant or agreement contained in this Senior Guarantee
Mortgage or in aid of the execution of any power granted in this Senior
Guarantee Mortgage or for the foreclosure of this Senior Guarantee Mortgage or
for the enforcement of any other legal, equitable or other remedy, as Mortgagee
shall deem most effectual to protect and enforce any of the rights of Mortgagee;
the failure to join tenants shall not be asserted as a defense to any
foreclosure or proceeding to enforce the rights of Mortgagee.
Section 3.11. Incidents of Sale.
Upon any sale of any of the Trust Estate, whether made under the power of
sale hereby given or pursuant to judicial proceedings, to the extent permitted
by law:
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(a) the principal of and accrued interest on the Senior Notes, if not
previously due, shall at once become and be immediately due and payable;
(b) subject to the provisions of Section 3.14 and the receipt of any
required prior approvals of the New Jersey Casino Control Commission, Mortgagee
may bid for and purchase the property offered for sale, and upon compliance with
the terms of sale may hold, retain, possess and dispose of such property,
without further accountability, and may, in paying the purchase money therefor,
deliver the Senior Notes or claims for interest thereon in lieu of cash to the
amount which shall, upon distribution of the net proceeds of such sale, be
payable thereon, and the Senior Notes, in case the amounts so payable thereon
shall be less than the amount due thereon, shall be returned to Mortgagee after
being appropriately stamped to show the partial payment;
(c) Mortgagee may make and deliver to the purchaser or purchasers a good
and sufficient deed, bill of sale and instrument of assignment and transfer of
the property sold;
(d) Mortgagee is hereby irrevocably appointed the true and lawful attorney
of Mortgagor, in its name and stead, to make all necessary deeds, bills of sale
and instruments of assignment and transfer of the property thus sold; and for
that purpose it may execute all necessary deeds, bills of sale and instruments
of assignment and transfer, and may substitute one or more persons, firms or
corporations with like power, Mortgagor hereby ratifying and confirming all that
its said attorney or such substitute or substitutes shall lawfully do by virtue
hereof; but if so requested by Mortgagee or by any purchaser, Mortgagor shall
ratify and confirm any such sale or transfer by executing and delivering to
Mortgagee or to such purchaser or purchasers all proper deeds, bills of sale,
instruments of assignment and transfer and releases as may be designated in any
such request;
(e) all right, title, interest, claim and demand whatsoever, either at law
or in equity or otherwise, of Mortgagor of, in and to the property so sold shall
be divested and such sale shall be a perpetual bar both at law and in equity
against Mortgagor, its successors and assigns, and against any and all persons
claiming or who may claim the property sold or any part thereof from, through or
under Mortgagor, its successors and assigns; and
(f) the receipt of Mortgagee or of the officer making such sale shall be a
sufficient discharge to the purchaser or purchasers at such sale for his or
their purchase money and such purchaser or purchasers and his or their assigns
or personal representatives shall not, after paying such purchase money and
receiving such receipt, be obliged to see to the application of such purchase
money, or be in anywise answerable for any loss, misapplication or
non-application thereof.
Section 3.12. Receiver.
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Upon the occurrence of an Event of Default and commencement of judicial
proceedings by Mortgagee to enforce any right under this Senior Guarantee
Mortgage, Mortgagee shall be entitled, as against Mortgagor, without notice or
demand and without regard to the adequacy of the security for the Senior Notes
or the Senior Guarantee or the solvency of Mortgagor, to the appointment of a
receiver of the Trust Estate, and of the rents, issues, profits, revenues and
other income thereof; provided, however, that Mortgagee's rights under this
Section 3.12 shall be subject to the provisions of the New Jersey Casino Control
Act and Section 3.14 hereof.
Section 3.13. Suits to Protect the Trust Estate.
Mortgagor hereby acknowledges the right of Mortgagee, in the name and on
behalf of Mortgagor, (a) to appear in and defend any action or proceeding
brought with respect to the Trust Estate or any part thereof and (b) upon 5
days' prior notice to Mortgagor (or such shorter period or without notice if
deemed necessary and appropriate by Mortgagee), to institute and to maintain
such proceedings as Mortgagee may deem necessary and appropriate, but in the
case of (a) and (b) only to prevent any impairment of security or any impairment
of the Trust Estate by any acts which may be unlawful or in violation of this
Senior Guarantee Mortgage and to protect Mortgagee's interests in the Trust
Estate and in the rents, issues, profits, revenues and other income arising
therefrom, including the right to institute and maintain proceedings to restrain
the enforcement of or compliance with any governmental enactment, rule or order
that may be unconstitutional or otherwise invalid, if the enforcement of or
compliance with such enactment, rule or order would impair the security
hereunder or be materially prejudicial to the interests of Mortgagee.
Section 3.14. Management of the Premises.
Without limiting the generality of any other provision of this Article
Three, following an Event of Default and the taking of possession of the Trust
Estate or any part thereof by Mortgagee and/or the appointment of a receiver of
the Trust Estate or any part thereof, Mortgagee or any such receiver shall be
authorized, in addition to the rights and powers of Mortgagee and such receiver
set forth elsewhere in this Senior Guarantee Mortgage, to take any action
permitted under Section 5.17 of the Senior Note Indenture.
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ARTICLE FOUR
CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE
Section 4.1. Consolidation, Merger, Conveyance or Transfer only on Certain
Terms.
Mortgagor shall comply with all provisions applicable to Mortgagor in
Article Eight of the Senior Note Indenture.
Section 4.2. Successor Entity Substituted.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer or disposition of the Trust Estate or any portion thereof in accordance
with Section 8.1 of the Senior Note Indenture (other than a lease), the
successor Person formed by such consolidation or into which Mortgagor is merged
or the successor Person to which such sale, assignment, conveyance, transfer or
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, Mortgagor under this Senior Guarantee Mortgage with
the same effect as if such successor had been named as Mortgagor herein; and
thereafter, except in the case of a lease, the Person named as "Mortgagor" in
the first paragraph of this instrument or any successor Person which shall
theretofore have become such in the manner prescribed in this Article shall be
discharged from all obligations and covenants under this Senior Guarantee
Mortgage.
ARTICLE FIVE
COVENANTS AND REPRESENTATIONS OF MORTGAGOR
Section 5.1. Performance of Senior Guarantee Obligations.
Mortgagor shall duly and punctually pay and perform its obligations under
the Senior Guarantee in accordance with the terms of the Senior Note Indenture
(including, without limitation, Article Fourteen thereof).
Section 5.2. F,F&E Financing Agreements.
Mortgagor shall comply with all of the terms and conditions set forth in
any F,F&E Financing Agreements before the expiration of any applicable notice
and cure periods contained in the F,F&E Financing Agreements.
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Section 5.3. Limitations on Liens and Transfers.
(a) Mortgagor shall not create, incur, suffer or permit to be created or
incurred or to exist any mortgage, lien, charge or encumbrance on or pledge of
any of the Trust Estate, other than (i) Permitted Encumbrances, (ii) a notice of
intention filed by a mechanic, materialman or laborer under the New Jersey
mechanic's lien law, and (iii) a building contract filed by a contractor or
subcontractor under the New Jersey mechanic's lien law. Without limiting the
generality of the foregoing sentence but notwithstanding the provisions of the
foregoing sentence, Mortgagor shall not be deemed to have breached the
provisions of the foregoing sentence by virtue of the existence of a lien for
Impositions or mechanics' liens so long as Mortgagor is in good faith contesting
the validity of the same in accordance with the provisions of Section 5.8.
(b) The lien of this Senior Guarantee Mortgage on the date hereof shall be
superior, and not subordinate to the lien of any Permitted Encumbrances (except
for items 1, 2, 3, 4 and 11 contained in the definition of Permitted
encumbrances and any other Working Capital Facility Mortgage) to the extent that
each thereof encumbers Mortgagor's interest in the Trust Estate or any part
thereof. Mortgagor shall from time to time after receipt of a request of
Mortgagee or the Trustee obtain instruments in form and substance reasonably
satisfactory to Mortgagee or Trustee, as the case may be, confirming the senior
lien priority of this Mortgage over the lien of any such Permitted Encumbrances.
(c) Except as otherwise expressly permitted under this Senior Guarantee
Mortgage and the Senior Note Indenture (including, without limitation, Article
Eight of the Senior Note Indenture), Mortgagor shall not sell, assign, lease or
otherwise transfer all or any portion of the Trust Estate or any interest
therein. Notwithstanding the foregoing, Mortgagor shall have the right, at any
time and from time to time, unless an Event of Default shall have occurred and
be continuing, without any release from or consent by Mortgagee, to grant
interests in the Owned Land in the nature of rights-of-way or easements, or
other rights or privileges in the nature of easements; provided, (i) that none
of the same will reduce or impair, in any material respect, (A) the value or
usefulness of the Trust Estate or any part thereof or (B) the normal operation
of the Casino Hotel in accordance with all Legal Requirements and all Permits,
(ii) Mortgagor has delivered to Mortgagee a Mortgagor's Certificate, dated not
earlier than 10 days prior to the date of each such grant, certifying that (A)
no Event of Default has occurred and is continuing and (B) the conditions set
forth in this Section 5.3(c) for such grant have been fulfilled and (iii)
Mortgagor has delivered to Mortgagee a duplicate original of the instrument, if
any, pursuant to which such grant is to be made, and such other instruments,
certificates and opinions as Mortgagee may reasonably request. The foregoing
provisions of this Section 5.3(c) shall be self-operative and no further
instrument shall be required to evidence the consent of Mortgagee to the grant
or other conveyance of such rights-of-way or easements. Mortgagee shall,
however, from time to time, after receipt of a Mortgagor Request therefor
(accompanied by a Mortgagor's Certificate stating that said conditions have been
satisfied) execute instruments in form and
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substance reasonably satisfactory to Mortgagee confirming the permissibility of
such grant or other conveyance.
Section 5.4. Environmental.
Without limiting the generality of any other provision of this Senior
Guarantee Mortgage, Mortgagor covenants, represents and warrants to Mortgagee as
follows:
(a) Mortgagor shall comply with any and all federal, state and local
environmental legislation, rules, and regulations in effect as of the date of
this Senior Guarantee Mortgage and subsequent thereto, including, without
limitation, the Spill Compensation and Control Act (N.J.S.A. 58:10-23. 11 et
seq.) (the"Spill Act"); the Industrial Site Recovery Act (N.J.S.A. 13:1K-6 et
seq.) ("ISRA"); the Solid Waste Management Act (N.J.S.A. 13:E-1 et seq.); the
Resource, Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.)
("RCRA"); the Comprehensive Environmental Response, Compensation and Liability
Act (42 U.S.C. Section 9601 et seq.) ("CERCLA") and such other environmental
legislation, rules and regulations, as are in or may come into effect and apply
to (i) Mortgagor and/or Mortgagee with respect to the Premises or (ii) the
transactions contemplated hereby, and as to any occupants or users of the
collateral, whether as lessees, tenants, licensees or otherwise, Mortgagor shall
use its best efforts to cause same to comply with said legislation, rules and
regulations. Mortgagor agrees to pay all costs required in connection with
compliance with the foregoing legislation, rules and regulations.
(b) Mortgagor has not used in the past, nor shall Mortgagor use in the
future, the Premises for the purpose of refining, producing, storing, handling,
transferring, processing or transporting "Hazardous Substances", as such term is
defined in ISRA, the Spill Act, CERCLA or the regulations relating thereto,
except that Mortgagor and its subsidiaries have used, and Mortgagor may continue
in the future to use, substances in the operation and maintenance of the
Premises, including, without limitation, heating oil, gasoline and cleaning
chemicals which could be considered as "Hazardous Substances" under the
preceding definition.
(c) To the best of Mortgagor's knowledge, after due inquiry and
investigation, none of the real property owned, leased and/or occupied by
Mortgagor and located in the State of New Jersey, including, without limitation,
the Premises, has been or is now being used as a "Major Facility" as such term
is defined in N.J.S.A. 58:10-23.11b(1). Mortgagor will not use the Premises in
the future as a "Major Facility".
(d) To the best of Mortgagor's knowledge, after due inquiry and
investigation, no lien has been attached to any revenues or any real or personal
property owned by Mortgagor or the Premises, as a result of the Chief Executive
of the New Jersey Spill Compensation Fund expending monies from said fund to pay
for "Cleanup Costs", as such term is defined in N.J.S.A. 58:10-23.11b(d),
arising from an intentional or unintentional action or omission of Mortgagor or
any previous owner and/or operator of such real property.
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(e) There is no asbestos or asbestos containing material on the Premises.
To the best of Mortgagor's knowledge, there are no underground storage tanks
located at the Premises, other than those tanks previously disclosed to
Mortgagee and which are maintained in accordance with all material Legal
Requirements. Mortgagor has not installed or placed, or permitted to be
installed or placed, any underground storage tanks at or on the Premises, other
than those tanks previously disclosed to Mortgagee and which are maintained in
accordance with all material Legal Requirements. Underground storage tanks shall
have the definition as set forth in N.J.S.A. 58:10A-22(p).
(f) Mortgagor has not received a summons, citation, directive, letter,
other written communication, or, to the best of its knowledge, any oral
communication, from the New Jersey Department of Environmental Protection and
Energy or from any other person, firm or corporation concerning any intentional
or unintentional action or omission on Mortgagor's part resulting in the
releasing, spilling, leaking, pumping, pouring, emitting, emptying or dumping of
"Hazardous Substances", as such term is defined in N.J.S.A. 58:10-23.11b(k),
into the waters or onto the lands of the State of New Jersey, or into the waters
outside the jurisdiction of the State of New Jersey, in either case resulting in
damage to the lands, waters, fish, shellfish, wildlife, biota, air and other
resources owned, managed, held in trust or otherwise controlled by the State of
New Jersey.
(g) In connection with any purchase of the Premises or any business or
assets located thereon or any "closing, terminating or transferring operations"
of any "industrial establishment", as that term is defined in ISRA, occurring on
or after December 31, 1983, Mortgagor required that the owner and or operator of
the industrial establishment comply with the provisions of ECRA and the owner
and or operator did comply therewith.
(h) Upon the occurrence of an Event (as hereinafter defined), Mortgagee
shall have the right to have its consultants perform a comprehensive
environmental audit of the Premises. Such audit shall be conducted by an
environmental consultant chosen by Mortgagee and may include a visual survey, a
record review, an area reconnaissance assessing the presence of hazardous or
toxic waste or substances, PCBs or storage tanks at the Premises, an asbestos
survey of the Premises, which may include random sampling of the improvements
and air quality testing, and such further site assessments as Mortgagee may
reasonably require due to the results obtained from the foregoing. Mortgagor
grants Mortgagee, its agents, consultants and contractors the right to enter the
Premises for the purposes of performing such studies and the cost of such
studies shall be due and payable by Mortgagor to Mortgagee upon demand and shall
be secured by the lien of this Senior Guarantee Mortgage. Mortgagee shall direct
the environmental consultant to use its best efforts not to hinder Mortgagor's
or any tenant's operations when conducting such audit, sampling or inspections.
For purposes of this paragraph, the term "Event" shall mean (i) the occurrence
of any Event of Default, (ii) the issuance of any summons, citation, directive
or similar written notice from the New Jersey Department of Environmental
Protection and Energy or from any other local, state or federal entity or from
any other person, firm or corporation concerning any alleged material violation
of any and all federal,
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state and local environmental legislation, rules and regulations in effect as of
the date of this Senior Guarantee Mortgage and subsequent thereto or (iii) the
initiation of any legal action, suits or other legal or administrative
proceedings relating to or in connection with any alleged violation of any and
all federal, state and local environmental legislation, rules and regulations in
effect as of the date of this Senior Guarantee Mortgage and subsequent thereto.
(i) If a lien shall be filed against the Premises by the New Jersey
Department of Environmental Protection and Energy, pursuant to and in accordance
with the provisions of N.J.S.A. 58:10-23.11f(f), as a result of the Chief
Executive of the New Jersey Spill Compensation Fund having expended monies from
said fund to pay for "Damages", as such term is defined in N.J.S.A.
58:10-23.11g, and/or "Cleanup and Removal-Costs", as such term is defined in
N.J.S.A. 58:10-23(b), arising from an intentional or unintentional action or
omission of Mortgagor resulting in the releasing, spilling, pumping, pouring,
emitting, emptying or dumping of "Hazardous Substances", as such term is defined
in N.J.S.A. 58:10-23.11(b)k into waters of the State of New Jersey or onto lands
from which it might flow or drain into said waters, then, unless there is a good
faith basis for contesting such lien and Mortgagor is so contesting such lien in
accordance with Section 5.8, Mortgagor shall, within 30 days from the date that
Mortgagor is given notice that the lien has been placed against the Premises or
within such shorter period of time if the State of New Jersey has commenced
steps to cause the Premises to be sold pursuant to the lien, either (i) pay the
claim and remove the lien from the Premises, or (ii) furnish (A) a bond
satisfactory to a title company selected by Mortgagee (the "Title Insurer") in
the amount of the claim out of which the lien arises, (B) to the Trustee, a cash
deposit (which may be disbursed by the Trustee in its sole discretion) in the
amount of the claim out of which the lien arises, or (C) other security
reasonably satisfactory to Mortgagee in an amount sufficient to discharge the
claim out of which the lien arises.
(j) Mortgagor shall use its best efforts to cause compliance by all
lessees with all applicable Legal Requirements relating to environmental
protection.
(k) Mortgagor shall promptly provide Mortgagee with copies of all notices
received by or prepared by Mortgagor in connection with ISRA, CERCLA, the Spill
Act, RCRA or any other environmental law, rule or regulation relating to the
Premises. For purposes of this paragraph, the term "notice" shall mean any
summons, citation, directive, order, claim, pleading, letter, application,
filing, report, findings, declarations or other materials pertinent to
compliance of the Trust Estate and Mortgagor with such environmental laws, rules
or regulations.
(l) If this Senior Guarantee Mortgage is foreclosed, Mortgagor shall
deliver the Premises in compliance with all applicable federal, state and local
environmental laws, ordinances, rules and regulations, including, without
limitation, ISRA.
(m) Without limiting the generality of Section 5.19, Mortgagor agrees to
defend, indemnify and save Mortgagee harmless from and against any loss or
liability, cost or expense (including, without limitation, reasonable attorneys'
fees, consultants' fees, disbursements and
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court costs) arising out of, or incurred in connection with, Mortgagor's
misrepresentation, or failure promptly (but in no event to exceed the time
period permitted by law) to comply with and perform its obligations, under this
Section 5.4. The provisions of this subsection (m) shall survive any transfer of
the Premises, including a transfer after a foreclosure of this Senior Guarantee
Mortgage.
Section 5.5. Warranty of Leasehold Estate and Title.
Mortgagor represents and warrants that as of the date hereof:
(a) Mortgagor is duly authorized under the laws of the State of New Jersey
and all other applicable laws to execute and deliver this Senior Guarantee
Mortgage, and all partnership action on Mortgagor's part necessary for the valid
execution and delivery of this Senior Guarantee Mortgage has been duly and
effectively taken;
(b) Mortgagor is the lawful owner and is lawfully seized and possessed of
the Owned Land and all buildings and improvements thereon, free and clear of all
liens, charges or encumbrances, other than the Mortgages, the Mortgage Documents
and the Existing Encumbrances;
(c) Mortgagor is the holder of and has good and marketable title to the
leasehold interests and leasehold estates under all existing Facility Leases,
subject to no lien, encumbrance or charge other than the Mortgages, the Mortgage
Documents and Existing Encumbrances;
(d) (i) each existing Facility Lease is a valid and subsisting demise of
the respective Leased Land for the term therein set forth, (ii) there are no
defaults under any Facility Lease by any lessor or the lessee as to which
written notice has been given to or by the lessee, (iii) Mortgagor has delivered
to Mortgagee and the Trustee a true and correct copy of each existing Facility
Lease, and all modifications, amendments and supplements thereto, and (iv) each
existing Facility Lease is in full force and effect and has not been modified,
amended or supplemented, except as described on Schedule 3;
(e) Mortgagor has good title to the Operating Assets, subject to no lien,
encumbrance or charge, other than Existing Encumbrances;
(f) Mortgagor has good and lawful right and authority to execute this
Senior Guarantee Mortgage and to grant, bargain, sell, alien, convey, assign,
transfer, hypothecate, pledge, mortgage and confirm the Trust Estate as provided
herein (including, without limitation, with respect to the Operating Assets and
Facility Leases), without the consent of any third party, other than
governmental authorities and other secured Persons but any applicable or
necessary consent or approval of any such governmental authority and other such
Persons has been given or waived in accordance with applicable law at or prior
to the execution and delivery of this Senior Guarantee Mortgage, and this Senior
Guarantee Mortgage constitutes a valid first
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mortgage lien and deed of trust and first priority security interest in the
Trust Estate, subject only to Existing Encumbrances and the pari passu liens of
the Mortgages;
(g) (i) all amounts due under the Mortgage Documents and the instruments
securing such amounts have been paid to the extent they were due and payable to
the date hereof, and (ii) there is no existing default under said Mortgage
Documents or instruments, or in the performance of any of the terms, covenants,
conditions or warranties therein on the part of Mortgagor to be performed and
observed thereunder as to which written notice has been given to Mortgagor; and
(h) Mortgagor hereby does and shall forever warrant and defend (a) the
title to the Trust Estate (including, without limitation, Mortgagor's leasehold
estate under, and the lessee's interests in, each existing Facility Lease)
(subject to items 1 and 3 listed on Schedule 3) and (b) the pari passu liens of
the Mortgages thereon (subject to items 1 and 3 listed on Schedule 3), against
the claims and demands of all persons whomsoever, at Mortgagor's sole cost and
expense.
Section 5.6. After-Acquired Property; Further Assurances; Recording.
All property, real, personal or mixed or any interest therein (other than
Excepted Property), of every kind and description and wheresoever situate, which
may be hereafter acquired by Mortgagor (including, without limitation, fee title
to any Leased Land) shall immediately upon the acquisition thereof by Mortgagor,
and without any further mortgage, conveyance or assignment, become subject to
the lien of this Senior Guarantee Mortgage as fully as though now owned by
Mortgagor and covered by the Granting Clauses. Nevertheless, Mortgagor shall do,
execute, acknowledge and deliver all and every such further acts, conveyances,
mortgages, financing statements and assurances as Mortgagee shall require for
accomplishing the express purposes of this Senior Guarantee Mortgage.
Mortgagor shall, as provided in Section 5.12, from time to time subject to
the lien of this Senior Guarantee Mortgage its right, title and interest under
all Leases.
Mortgagor shall use reasonable efforts to insure that all Operating Assets
(other than Excepted Property) or any interest therein hereafter acquired by
Mortgagor shall be assignable to Mortgagee, and to the extent such assignment to
Mortgagee requires the consent of any governmental authority or any other
Person, Mortgagor shall use reasonable efforts to obtain such consent or a
waiver thereof.
Mortgagor shall cause this instrument and all other instruments of further
assurance, including all financing statements and continuation statements
covering security interests in personal property, to be promptly recorded,
registered and filed, and at all times to be kept recorded, registered and
filed, and shall execute and file such financing statements and cause to be
issued and filed such continuation statements, all in such manner and in such
places as may be required by law or as requested by Mortgagee to fully preserve
and protect the rights of
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Mortgagee as a secured party under the Uniform Commercial Code to all property
comprising the Trust Estate (to the extent a grant of a security interest
therein is governed by the Uniform Commercial Code) and to perfect, preserve and
protect the lien of this Senior Guarantee Mortgage as a valid direct first
mortgage lien of record and a valid first priority security interest on the
Trust Estate, subject only to Permitted Encumbrances.
Mortgagor shall pay all filing or recording fees, and all expenses
incident to the execution and delivery of this Senior Guarantee Mortgage, any
financing statement or continuation statement with respect to the personal
property constituting part of the Trust Estate, and any instrument of further
assurance, and all federal, state, county and municipal stamp taxes and other
taxes, duties, imposts, assessments and charges arising out of or in connection
with the execution and delivery of the Senior Notes, this Senior Guarantee
Mortgage, any financing statement or continuation statement with respect to the
personal property constituting part of the Trust Estate or any instrument of
further assurance.
Mortgagor shall furnish to Mortgagee promptly after the acquisition
hereafter by Mortgagor of any fee interest or leasehold interest in real
property having a fair market value exceeding $500,000 (other than Excepted
Property), (a) a mortgagee policy of title insurance on the most recent form of
American Land Title Association standard loan policy, extended coverage, which
policy shall (i) contain all such endorsements and affirmative insurance, to the
extent reasonably applicable, as is contained in the Original Policy and (ii)
evidence that title to such real property is subject to no liens or encumbrances
(other than Permitted Encumbrances) which would (A) render title unmarketable or
(B) violate any other provision of this Senior Guarantee Mortgage or the Senior
Note Indenture, (b) an as-built survey meeting the "Minimum Standard Detail
Requirements for ALTA/ACSM Land Title Surveys", certified within 60 days prior
to the acquisition date by a surveyor licensed in the State of New Jersey using
the same form of certification as that contained in the surveys of the Premises
delivered to the Trustee on the date of this Senior Guarantee Mortgage and (c) a
Mortgagor's Certificate certifying that the mortgagee policy of title insurance
and survey delivered pursuant to clauses (a) and (b) comply, respectively, with
the provisions of such clauses (a) and (b). Upon delivery of all of the items
required under this paragraph, any liens or encumbrances on such real property
shall constitute Permitted Encumbrances hereunder.
Section 5.7. Payment of Taxes and Certain Claims; Maintenance of Properties;
Compliance with Legal Requirements and Insurance Requirements.
Mortgagor shall:
(a) subject to the provisions of Section 5.8, pay or cause to be paid
before the date on which any fine, penalty, interest or cost may be added for
nonpayment (but no later than when the same are payable by Mortgagor pursuant to
any Superior Instrument Requirement), all taxes (including, without limitation,
real estate taxes, personal or other property taxes and all sales,
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value added, use and similar taxes), assessments (including, without limitation,
all assessments for public improvements or benefits, whether or not commenced or
completed prior to the date hereof and whether or not to be completed prior to
the satisfaction of this Senior Guarantee Mortgage), water, sewer or other
rents, rates and charges, excises, levies, license fees, permit fees, inspection
fees and other authorization fees and other charges, in each case whether
general or special, ordinary or extraordinary, foreseen or unforeseen, of every
character (including, without limitation, all interest, additions to tax and
penalties thereon), that may be assessed, levied, confirmed or imposed on or in
respect of or be a lien upon (i) the Trust Estate (including, without
limitation, the Leased Land) or any part thereof or any rent therefrom or any
estate right or interest therein, or (ii) any acquisition, occupancy, use,
leasing, or possession of or activity conducted on the real property or any part
thereof included in the Trust Estate or any gross receipts thereof or of the
rent therefrom (all of the foregoing being referred to collectively as
"Impositions"). Notwithstanding the foregoing or any other provision of this
Senior Guarantee Mortgage, Mortgagor shall not be required to pay any income,
profits or revenue tax upon the income of Mortgagee, the Trustee or the Holders
nor any franchise, excise, corporate, estate, inheritance, succession, capital
levy or transfer tax of Mortgagee, the Trustee or the Holders nor any interest,
additions to tax or penalties in respect thereof, unless such tax is imposed,
levied or assessed in substitution for any Imposition that Mortgagor is required
to pay pursuant to this Section 5.7. Mortgagor shall deliver to Mortgagee, at
Mortgagee's request, official receipts or other proof evidencing payments of any
Impositions in accordance with the requirements of this Section 5.7. Mortgagor
shall not be entitled to any credit for taxes or assessments paid against the
Senior Notes;
(b) except for such obsolete property as Mortgagor may dispose of or
replace pursuant to Section 2.2, maintain and keep all of Mortgagor's properties
used or useful in the conduct of Mortgagor's business, including, without
limitation, the Casino Hotel and all Tangible Personal Property, in such good
repair, working order and condition, except for reasonable wear and use, and
make or cause to be made all such needful and proper repairs, renewals and
replacements thereto consistent with the standards of first-class casino and
hotel complexes in Atlantic City, New Jersey;
(c) occupy and continuously operate the Casino Hotel and keep the Casino
Hotel supplied with Tangible Personal Property, all in a manner consistent with
the standards of first-class casino and hotel complexes in Atlantic City, New
Jersey;
(d) subject to the provisions of Section 5.8, (i) comply with all Legal
Requirements and Insurance Requirements, whether or not compliance therewith
shall require structural changes in the buildings and improvements included in
the Trust Estate or interfere with the use and enjoyment of the Trust Estate or
any part thereof, (ii) procure, maintain and comply with all Permits required
for (1) the use of the Casino as a gaming and gambling facility, (2) the
on-premises consumption of alcoholic beverages at the Casino Hotel and (3) any
other use of the Trust Estate or any part thereof then being made, and for the
proper erection, installation, operation and maintenance of the improvements or
any part thereof, (iii) comply with all
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obligations of Mortgagor under, and keep in full force and effect, all easements
which in any respect inure to the benefit of, or otherwise affect, the Trust
Estate or any part thereof, if the failure to comply with the same would impair
Mortgagee's security hereunder, and (iv) without limiting the generality of
clause (iii), comply with any instruments of record at the time in force
affecting the Trust Estate or any part thereof, if the failure to comply with
the same would impair Mortgagee's security hereunder. Without limiting the
generality of the foregoing, Mortgagor represents and warrants that at the time
of the execution of this Senior Guarantee Mortgage, Mortgagor is in compliance
with the requirements of clauses (i), (ii), (iii) and (iv) above; and
(e) in the event of the passage after the date of this Senior Guarantee
Mortgage of any law of the State of New Jersey, or any other governmental
entity, changing in any way the laws now in force for the taxation of mortgages,
or debts secured thereby, for federal, state or local purposes, or the manner of
the operation of any such taxes, so as to affect the interest of Mortgagee, pay
the full amount of such new or additional taxes.
Section 5.8. Permitted Contests.
Notwithstanding anything in this Senior Guarantee Mortgage to the
contrary, Mortgagor, at Mortgagor's expense, may contest (after prior notice to
Mortgagee) by appropriate legal proceedings conducted in good faith and with due
diligence, the amount or validity or application, in whole or in part, of any
Imposition or lien therefor or any Legal Requirement or Insurance Requirement or
the application of any instrument of record (including, without limitation, any
Superior Instrument Requirement) affecting the Trust Estate or any part thereof
or any claims of holders of F,F&E Financing Agreements, mechanics, materialmen,
suppliers, or vendors or lien therefor, and may withhold payment of the same
pending such proceedings if permitted by law, or make payment under protest, or
defer compliance with any such Legal Requirement, any such Insurance Requirement
or the terms of any such instrument, and the same shall not be a Default
hereunder; provided, that (a) in the case of any Impositions or lien therefor or
any claims of mechanics, materialmen, suppliers or vendors or lien therefor,
such proceedings shall suspend the collection thereof from each of Mortgagor,
Mortgagee, the Trustee, the Holders and the Trust Estate, (b) neither the Trust
Estate nor any interest therein would be in any significant danger of being
sold, forfeited, or lost, (c) such action will not result in the termination of
any Facility Lease, (d) in the case of a Legal Requirement, neither the Holders
nor Mortgagee shall be in any significant danger of any civil liability or any
danger of any criminal liability, and the failure of Mortgagor to comply with
such Legal Requirement shall not affect the continuance in good standing of any
Permit or result in the suspension, termination, non-renewal or material adverse
modification of any Permit, and (e) in the case of an Insurance Requirement, the
failure of Mortgagor to comply therewith shall not affect the validity of any
insurance required to be maintained by Mortgagor hereunder.
Section 5.9. Mechanics' and Other Liens.
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Mortgagor shall cause to be removed, either by payment, or bonding or
otherwise, all claims and demands of mechanics, materialmen, laborers, and
others which, if unpaid, might result in, or permit the creation of, a lien on
the Premises and/or Trust Estate or any part thereof, or on the revenues, rents,
issues, income and profits arising therefrom and in general shall do or cause to
be done everything necessary so that the lien hereof shall be fully preserved,
at the cost of Mortgagor, without expense to Mortgagee.
Section 5.10. To Insure.
(a) Mortgagor, at Mortgagor's expense, shall maintain with Insurers:
(i) insurance with respect to Mortgagor's insurable properties
constituting a part of the Trust Estate against loss or damage by fire,
lightning, and other risks from time to time included under "all-risk"
policies and against loss or damage by sprinkler leakage, water damage,
collapse, malicious mischief and explosion in respect of any steam and
pressure boilers and similar apparatus located on such insurable
properties, in amounts at all times sufficient to prevent Mortgagor from
becoming a coinsurer within the terms of the applicable policies, but in
any event such insurance shall be maintained in not less than the greatest
of the following (the "Insurance Amount"): (A) 100% of the then Full
Insurable Value of such insurable properties, determined from time to time
(but not less frequently than once in any 36 calendar months), by an
Appraiser or Insurer, (B) the then Outstanding Amount of Mortgage Debt,
including the Senior Partnership Note, or (C) the amount required to be
maintained pursuant to the Superior Instrument Requirements;
(ii) war risk insurance as and when such insurance is obtainable
from the United States of America or any agency thereof as promptly as
reasonably practicable after the same becomes so obtainable, in an amount
not less than the Insurance Amount, or, if such insurance cannot be
obtained in an amount not less than the Insurance Amount, in such lesser
amount as may then be so obtainable;
(iii) comprehensive general liability insurance, including, without
limitation, blanket contractual liability coverage, broad form property
damage, independent contractor's coverage and personal injury coverage
against any and all claims arising out of or connected with the
possession, use, leasing, operation or condition of such insurable
properties, in an amount not less than $100,000,000 combined single limit
coverage for personal injury and property damage with respect to any one
occurrence, which may be under an umbrella policy. Anything contained in
this clause (iii) to the contrary notwithstanding, the Superior Instrument
Requirements with respect to the kinds and amount of insurance described
in this clause (iii) shall be satisfied by Mortgagor;
(iv) workers' compensation insurance to the extent required by law;
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(v) business interruption insurance covering not less than 6 months
of loss, provided that, at any time that Mortgagor is renewing any policy
for such insurance or taking out any new or replacement policy for such
insurance covering a period of less than 12 months, Mortgagor shall
deliver to Mortgagee an Officers' Certificate certifying that the period
of coverage to be maintained by Mortgagor under such policy is the maximum
that can be maintained at rates determined by Mortgagor to be reasonable
for such coverage;
(vi) to the extent available, flood insurance in an amount not less
than the Insurance Amount, or, if such insurance cannot be obtained in an
amount not less than the Insurance Amount, such lesser amount as may then
be so obtainable but in no event less than $100,000,000; and
(vii) such other insurance with respect to such insurable properties
against loss or damage of the kinds (A) from time to time customarily
insured against by persons owning or using first-class casino and hotel
complexes in Atlantic City, New Jersey and (B) required to be maintained
pursuant to any Superior Instrument Requirements.
Notwithstanding the foregoing, to the extent not violative of any Superior
Instrument Requirements, (A) Mortgagor may maintain a deductible with respect to
the insurance policies described in clauses (i), (ii), (vi) and (vii) in an
amount not to exceed $250,000, (B) Mortgagor may maintain a deductible with
respect to the insurance policies described in clause (iii) in an amount not to
exceed $500,000, and (C) Mortgagor may maintain a deductible with respect to the
insurance policies described in clause (v) in an amount not to exceed
$1,000,000.
(b) (i) Each policy of insurance maintained by Mortgagor pursuant to
Section 5.10(a) shall, (A) except in the case of workers' compensation
insurance, name Mortgagor as an insured and shall name as additional insurers
(1) Mortgagee and (2) to the extent required by the Superior Instrument
Requirements, the lessors under any Facility Leases, (B) provide that all
insurance proceeds for losses, except in the case of comprehensive general
liability insurance and workers' compensation insurance or as otherwise provided
in Subsections (d), (e) and (f) of this Section 5.10, be payable solely to
Mortgagee, (C) include effective waivers (whether under the terms of any such
policy or otherwise) by the insurer of all claims for insurance premiums against
all loss payees and named insurers (other than Mortgagor) and all rights of
subrogation against any named insured, (D) except in the case of comprehensive
general liability and workers' compensation insurance, provide that any losses
shall be payable notwithstanding (1) any act, failure to act, negligence of, or
violation or breach of warranties, declarations or conditions contained in such
policy by Mortgagor or Mortgagee or any other named insured or loss payee
(including, without limitation, the lessors under the Facility Leases with
respect to any Leased Facilities), (2) the occupation or use of the insurable
properties for purposes more hazardous than permitted by the terms of the
policy, (3) any foreclosure or other proceeding or notice of sale relating to
the insurable properties or (4) any change in the title to or ownership or
possession of the insurable properties, (E) contain a non-contributory mortgagee
clause in favor of Mortgagee,
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and (F) provide that if all or any part of such policy is canceled, terminated
or expires, the insurer will forthwith give notice thereof to each named insured
and loss payee and that no cancellation, non-renewal, reduction in amount or
material change in coverage thereof shall be effective until at least 30 days
after receipt by each named insured and loss payee of written notice thereof.
(ii) Mortgagor may effect the insurance required under this Section 5.10
under blanket and/or umbrella policies covering properties owned or leased by
Affiliates of Mortgagor; provided, that (A) such policies otherwise comply with
this Senior Guarantee Mortgage, (B) except with respect to flood insurance and
earthquake insurance, provide that the amount of coverage afforded thereunder
with respect to the Trust Estate shall not be reduced by claims thereunder
against such other properties and (C) in the case of flood insurance provide
that the amount of coverage afforded thereunder with respect to the Trust Estate
shall not be reduced below $100,000,000 by reason of claims thereunder against
such other properties.
(c) Mortgagor shall deliver to Mortgagee duplicate originals of all
insurance policies that Mortgagor is required to maintain pursuant to this
Section 5.10. Mortgagee shall not be responsible for effecting or renewing any
insurance or for the responsibility or solvency of the insurers.
(d) Mortgagor shall give written notice to Mortgagee immediately upon
obtaining knowledge of any Casualty which (i) results in damage, loss or
destruction in an amount in excess of $5,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property or (ii)
pursuant to any Superior Instrument Requirement, would require the deposit of
insurance proceeds with the Insurance Trustee or action or proceeding with
respect thereto. Within 30 days after any Casualty which results in any damage,
loss or destruction in an amount in excess of $10,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property, Mortgagor
shall deliver to Mortgagee a certificate of an Architect stating whether, in
such Architect's opinion, applicable Legal Requirements permit the Restoration
of said buildings and improvements for the same uses and to the same size and
quality in all material respects, as existed immediately prior to the Casualty
(and if said certificate states that Legal Requirements do not permit such
Restoration, said certificate shall describe the manner closest approximating
such criteria to which the buildings and improvements could be so restored and
shall be accompanied by a Certificate Of Appraised Value dated not more than 10
days prior to delivery setting forth the Appraised Value immediately prior to
the Casualty and the estimated Appraised Value immediately after the
Restoration). If Mortgagor is required to deliver such Certificates of Appraised
Value and if based on such Certificates of Appraised Value immediately after
Restoration, (i) the aggregate Outstanding Amount of Indebtedness of the
Mortgagor, the Company or TCHI immediately after such Restoration shall exceed
the greater of (A) 80% of the Appraised Value immediately after such Restoration
or (B) the quotient of the Outstanding Amount of Indebtedness immediately prior
to such Casualty divided by the Appraised Value immediately prior to the
Casualty multiplied by the Appraised Value immediately after such Restoration,
or (ii) applicable Legal Requirements do not permit the Restoration of the
Casino Hotel for use as a casino and hotel
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complex, then, in either of such events, the proceeds of any insurance shall not
be applied to Restoration but shall instead be applied to the Senior
Indebtedness to the extent of the then Outstanding Amount of the Senior Notes
and any other interest or other sums due hereunder or thereunder to be applied
to the satisfaction of this Senior Guarantee Mortgage. Provided that no
additional sums are due to the trustees or the holders under the Senior Notes,
the Senior Note Indenture, the Senior Guarantee, the TCHI Notes, the TCHI Note
Indenture, the TCHI Guarantee, the Mortgage Notes, or the Mortgage Note
Indenture, the balance of any net insurance proceeds after the payments
described in the immediately preceding sentence shall be paid to Mortgagor.
(e) Subject to the provisions of Subsection 5.10(d), if a Casualty occurs,
the following shall apply:
(i) If the cost of Restoration is less than $10,000,000, the net
insurance proceeds shall be paid by Mortgagee to Mortgagor.
(ii) If the cost of Restoration is $10,000,000 or more, the net
insurance proceeds shall be paid by Mortgagee to the Insurance Trustee.
(iii) Mortgagor shall commence with reasonable promptness under the
circumstances and thereafter with due diligence proceed to perform and
complete in a good and workmanlike manner the restoration, repair,
replacement or rebuilding of the damage or destruction resulting from the
Casualty (all such restoration, repair, replacement and rebuilding
following a Casualty or a Taking are referred to as "Restoration") in
accordance with the plans and specifications submitted to the Insurance
Trustee, in conformance with all Legal Requirements and Superior
Instrument Requirements, and in accordance with the further provisions of
this Subsection (e), regardless of the extent of any such Casualty and
whether or not net insurance proceeds, if any, shall be available or, if
available, shall be sufficient, for the purpose of the Restoration. All
Restoration work shall be performed in accordance with the applicable
provisions of Section 5.12 and in conformance with all Superior Instrument
Requirements, Legal Requirements and Insurance Requirements and, prior to
commencing any Restoration, Mortgagor shall obtain all Permits necessary
in connection therewith, and shall obtain, and keep in full force and
effect until the completion of such Restoration, such additional insurance
as the Insurance Trustee and Superior Instrument Requirements may require.
The plans and specifications for the Restoration shall be accompanied by a
Mortgagor's Certificate and an Opinion of Counsel to the effect that upon
the completion of the Restoration pursuant to the plans and
specifications, the Premises and all buildings and improvements thereon
will comply with all Superior Instrument Requirements, Legal Requirements
and Insurance Requirements.
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(iv) Any insurance proceeds which Mortgagor receives shall be held
by Mortgagor in trust for the purpose of paying the cost of the
Restoration, except as otherwise provided herein.
(v) Any net insurance proceeds that the Insurance Trustee holds
pursuant to this Subsection (e), shall be deposited in an interest-bearing
investment reasonably designated by Mortgagor (to the extent Mortgagor is
permitted to designate such investment under the Superior Instrument
Requirements) (and the interest thereon shall be added to such proceeds)
and shall be paid by the Insurance Trustee to reimburse Mortgagor for, or
to make payment for, the Restoration, after the Insurance Trustee deducts
therefrom the amount of any reasonable costs and expenses incurred in
connection with the performance of its obligations under this Section
5.10. The Insurance Trustee shall make such payments not more frequently
than once every 30 days upon the written request of Mortgagor (unless more
frequent payments are required by Superior Instrument Requirements), by
paying to Mortgagor or the persons named in the certificate described in
clause (vi) of this Subsection (e) the respective amounts stated in such
certificate from time to time as the Restoration progresses, provided
Mortgagor has complied with the requirements of this Subsection (e) and
such payment is permitted by any applicable Superior Instrument
Requirements. Mortgagor's request shall be accompanied by (A) the
certificate described in clause (vi) of this Subsection (e) and (B) a
title company or official search, or other evidence reasonably acceptable
to the Insurance Trustee, showing that there have not been filed with
respect to the Premises, any vendor's, contractor's, mechanic's, laborer's
or materialman's statutory or similar lien which has not been discharged
of record (or bonded against or secured by other security) or any other
encumbrance irrespective of its priority (other than Permitted
Encumbrances).
(vi) The certificate required by clause (v) of this Subsection (e)
shall (A) be a Mortgagor's Certificate, countersigned by the Architect in
charge of the Restoration with respect to the matters described in (1) and
(5) below, (B) be dated not more than 10 days prior to such request and
(C) set forth (in addition to any other requirements contained in any
applicable Superior Instrument Requirements) that:
(1) all of the Restoration theretofore performed is in
substantial compliance with the plans and specifications theretofore
submitted to the Insurance Trustee and in compliance with all
Superior Instrument Requirements, Legal Requirements and Insurance
Requirements;
(2) the sum then requested either has been paid by Mortgagor
or is justly due to contractors, subcontractors, materialmen,
engineers, architects or other persons who have rendered services or
furnished or contracted to deliver materials for the Restoration
therein specified, and the names and addresses of such persons, a
brief description of such services and materials and the several
amounts so paid or due to each of said persons in respect thereof;
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(3) no part of the amount requested has been or is the basis
in any previous or then pending request for the withdrawal of net
insurance proceeds, and that the sum then requested does not exceed
the value of the services and materials described in the
certificate;
(4) except for the amount, if any, stated pursuant to
subclause (2) of this clause (vi) in such certificate to be due for
services or materials, and except for amounts in dispute and/or
customary retainages, there is no outstanding indebtedness known to
the person signing such certificate, after due inquiry, which is
then due for labor, wages, materials, supplies or services in
connection with such Restoration; and
(5) the remaining cost, as estimated by the persons signing
such certificate, of the Restoration in order to complete the same
does not exceed the net insurance proceeds remaining in the hands of
Insurance Trustee after payment of the sum requested in such
certificate or if such estimated cost does exceed such insurance
proceeds such certificate shall state the amount of any such
deficiency. If the certificate states that such deficiency will
exist, Mortgagor shall deliver the amount of such deficiency in cash
or cash equivalent to the Insurance Trustee simultaneously with the
delivery of such certificate, which amount shall be deemed insurance
proceeds for purposes of this Section 5.10(e).
(vii) If net insurance proceeds shall be insufficient to pay the
entire cost of the Restoration, then, after completion of the Restoration,
Mortgagor shall pay the deficiency. If all or any part of the net
insurance proceeds are not used for the Restoration in accordance with
this Subsection (e) (because such proceeds exceed the amount required to
complete the Restoration), then upon completion of the Restoration in
accordance with this Subsection (e), such amount not so used, if held by
the Insurance Trustee, shall be paid to Mortgagor (if permitted by
Superior Instrument Requirements).
(f) Mortgagor shall not take out separate insurance, concurrent in form or
contributing in the event of loss with that required to be maintained pursuant
to this Section 5.10, unless the same is permitted by Superior Instrument
Requirements. Mortgagor shall immediately notify Mortgagee whenever any such
separate insurance is taken out and shall promptly deliver to Mortgagee a
duplicate original of the policy of such insurance, a copy thereof certified by
the insurer or a certificate thereof. Provided that no Event of Default has
occurred and is continuing, all net business interruption insurance proceeds
shall be paid to Mortgagor, to be segregated from the other funds of Mortgagor
and held in trust by Mortgagor for the following purposes and in the following
order of priority: (i) for the payment of Impositions and amounts due under the
Facility Leases, (ii) for debt service under the Senior Notes for the estimated
period of Restoration (for purposes of this Subsection 5.10(f), interest and
principal payments due on any payment date under the Senior Partnership Note
will be deemed to accrue in equal daily installments beginning the day after the
immediately preceding payment date and ending on such
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payment date), and (iii) for any other expense incurred in connection with the
operation or business of the Casino Hotel.
(g) Insurance claims by reason of damage or destruction to any portion of
the Trust Estate may be adjusted by Mortgagor, but Mortgagee shall have the
right (but not the obligation) to join Mortgagor in adjusting, and approving the
adjustment of, any such loss except in the event of a loss where the amount of
insurance reasonably anticipated to be received with respect to such loss is
less than $5,000,000, and Mortgagor shall assist Mortgagee in any such
adjustment at the request of Mortgagee. If Mortgagee at its election as
aforesaid joins Mortgagor in any adjustment process, then Mortgagee's approval
of the adjustment shall not be unreasonably withheld.
(h) Notwithstanding anything contained herein to the contrary, if an Event
of Default shall have occurred and be continuing, Mortgagee may, at its option,
(A) refrain from paying to Mortgagor or the Insurance Trustee any net insurance
proceeds or (B) instruct the Insurance Trustee to pay to Mortgagee any insurance
proceeds then held by the Insurance Trustee, as the case may be.
Section 5.11. Limitations on Building Demolition, Alterations, Improvements and
New Construction.
Mortgagor shall not authorize, permit or make any demolition, alteration
or improvement of any building, structure or other improvements included in the
Trust Estate or any new construction on any part of the Trust Estate, except in
conformity with and subject to the limitations hereinafter in this Section 5.11
set forth and set forth in the Senior Note Indenture.
Unless an Event of Default shall have occurred and be continuing,
Mortgagor shall have the right at all times to make or permit such demolition,
alterations, improvements or new construction, structural or otherwise (herein
sometimes called collectively "Alterations" and each, individually, an
"Alteration"), of the Trust Estate, to be made in all cases subject to each of
the following conditions:
(a) No Alteration shall be undertaken or carried out except in conformity
with all Superior Instrument Requirements, Legal Requirements and Insurance
Requirements.
(b) If the estimated cost of any Alteration, together with other
Alterations that constitute a single construction plan or project (whether or
not accomplished in several stages or procedures), exceeds $5,000,000, the
building or buildings, structures or other improvements as so improved or
altered, upon the completion of the work, shall be of a value not less than the
value of such building or buildings, structures or other improvements
immediately prior to the making of such Alteration.
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(c) Any Alteration which is structural in nature or involves an estimated
cost of more than $5,000,000 shall be conducted under the supervision of an
Architect, and no such Alteration shall be undertaken until 10 days after there
shall have been filed with Mortgagee detailed plans and specifications and cost
estimates therefor, prepared and approved in writing by such Architect and
accompanied by a certificate of such Architect stating that such plans and
specifications conform to all applicable provisions of this Section 5.11.
(d) No Alteration involving an estimated cost of more than $5,000,000
shall be undertaken until Mortgagor has furnished to Mortgagee, at Mortgagor's
sole cost and expense, a surety bond or bonds, covering performance, and labor
and material payments with respect to the work to be so performed, naming
Mortgagee as obligee, issued by a responsible surety company, authorized to do
business in the State of New Jersey, in a form generally and customarily used by
such surety in an amount equal to the estimated cost of construction of the work
covered by the plans and specifications therefor, guaranteeing the performance
and completion of such construction, substantially in conformity with the said
plans and specifications and within a reasonable time, subject to delays by
fire, strikes, lock-out, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable Casualty
or other similar causes beyond the control of Mortgagor, free and clear of all
liens, claims and liabilities for the cost of such Alterations. If such surety
bond or bonds shall be unobtainable Mortgagor shall deliver to Mortgagee
security by cash, letter of credit or other guarantee, affording substantially
the same protection as would such bond or bonds.
(e) All work done in connection with any Alterations shall be done
promptly and in good and workmanlike manner. The work in connection with any
Alteration shall be prosecuted with reasonable dispatch, delays due to fire,
strikes, lock-outs, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable Casualty
or similar causes beyond the control of Mortgagor excepted.
(f) If the estimated cost of Alterations exceeds $5,000,000, Mortgagor
shall have delivered to Mortgagee (i) prior to the commencement of such
Alterations, copies of all Permits required for the commencement of such work
together with a certificate of the Architect or an Opinion of Counsel to the
effect that all Permits required for the commencement of such Alterations have
been obtained; and (ii) within a reasonable period of time after the completion
of the Alterations, copies of all Permits required in connection with the
completion thereof, together with either an Opinion of Counsel or a certificate
of the Architect that all such Permits have been so obtained by Mortgagor and
that Mortgagor has complied with all the requirements of this Section 5.11.
(g) No Alterations of any kind shall be made which shall change the use or
reduce the size or quality of any building, structure or other improvements in
any material respect or which shall change the use of the Casino Hotel from its
use as a gaming and hotel facility.
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(h) No Alterations costing in excess of $5,000,000, together with other
Alterations that constitute a single construction plan or project (whether or
not accomplished in several stages or procedures), shall be made if such
Alterations are not expected to be completed at least 120 days prior to the
Stated Maturity of the Senior Notes (except if such Alterations are required in
order to comply with Legal Requirements or Superior Instrument Requirements).
(i) Mortgagor shall maintain at all times during the performance of
Alterations, in addition to any insurance required to be maintained under
Section 5.11 hereof, appropriate workers' compensation insurance covering all
persons employed for such Alterations to the extent required by applicable law,
and comprehensive general liability insurance expressly covering the additional
hazards due to such Alterations. Each such policy of insurance shall comply with
the provisions of Section 5.10(b), and Mortgagor shall comply with Subsections
(c), (d), (e), (f), (g) and (h) of Section 5.10 in connection with all such
insurance.
Section 5.12. Leases.
Mortgagor shall not:
(a) lease the Trust Estate substantially as an entirety to any Person
(except in accordance with the provisions of Article Eight of the Senior Note
Indenture), nor shall Mortgagor lease either the Casino Hotel or the Casino or
the Hotel or any parking facilities substantially as an entirety to any Person;
(b) enter into any Lease, or renew, modify, extend, terminate, or amend
any Lease, except in the ordinary course of business of operating the Casino
Hotel;
(c) receive or collect, or permit the receipt or collection of, any rental
payments under any Lease more than one month in advance of the respective
periods in respect of which they are to accrue, except that, in connection with
the execution and delivery of any Lease or of any amendment to any Lease, rental
payments thereunder may be collected and received in advance in an amount not in
excess of three months' rent and/or a security deposit may be required
thereunder in an amount not exceeding one year's rent;
(d) collaterally assign, transfer or hypothecate (other than to Mortgagee
hereunder, to the holder of the Senior Note Mortgage, the holder of the TCHI
Note Guarantee Mortgage or the holder of the Senior Partnership Upstream Note
Mortgage, but in each case only with respect to the property secured by such
mortgage) (i) any rental payment under any Lease whether then due or to accrue
in the future, (ii) the interest of Mortgagor as landlord under any Lease or
(iii) the rents, issues or profits of the Trust Estate;
(e) after the date hereof, enter into any Lease, or renew any Lease,
unless such Lease contains terms to the effect as follows:
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(i) the Lease and the rights of the tenants thereunder shall be
subject and subordinate to the rights of Mortgagee under this Senior
Guarantee Mortgage,
(ii) the Lease may be assigned by the landlord thereunder to
Mortgagee, and
(iii) the rights and remedies of the tenant in respect of any
obligations of the landlord thereunder shall be nonrecourse as to any
assets of the landlord other than its equity in the building in which the
leased premises are located or the proceeds thereof; or
(f) modify any Lease with respect to the matters described in clauses (i)
through (iii) of paragraph (e).
If Mortgagor enters into a Lease (other than with an Affiliate of
Mortgagor) for a term of not less than 3 years, Mortgagee shall deliver a
non-disturbance and attornment agreement substantially in the form of Schedule 7
hereto, following receipt of a certificate of a leasing broker (who is not an
Affiliate of Mortgagor or the broker involved in such transaction) experienced
with respect to leases of commercial space in the Atlantic City area stating
that the rent under the Lease throughout the term thereof is not less than fair
market rent and the other terms of the Lease are fair and reasonable in the
commercial leasing market. Mortgagor shall, upon demand, reimburse Mortgagee for
any costs and expenses (including reasonable attorneys' fees and disbursements)
incurred by Mortgagee in connection with the preparation, review and delivery of
such non-disturbance and attornment agreements.
Promptly after the execution and delivery hereof, and promptly after each
Lease is executed or becomes effective after the date of the execution and
delivery hereof, Mortgagor shall cause the lessee under each such Lease to be
duly notified in writing (unless the substance and effect of such notice shall
be contained in such Lease) of the subjection of the owner's interest, as
lessor, in and to such Lease to the lien of this Senior Guarantee Mortgage and
of the name and address of Mortgagee. Each such notice shall state that the
lease of such lessee is a Lease as herein defined. If a new Mortgagee is at any
time appointed hereunder or the address of Mortgagee shall at any time be
changed, Mortgagor shall cause each lessee under each Lease to be promptly
notified in writing of the name and address of such new Mortgagee or the new
address of Mortgagee. Mortgagor shall use reasonable efforts (but shall not be
obligated to incur any expenditure other than de minimis amounts) to obtain from
each lessee under each Lease to whom any notice is sent pursuant to this
paragraph an acknowledgment of receipt of such notice, and Mortgagor shall
promptly deliver to Mortgagee,, upon request, a copy of each such acknowledgment
of receipt which it is able to obtain. Mortgagee shall not be responsible for
securing or causing Mortgagor to secure any such acknowledgment.
Section 5.13. Compliance Certificates.
Mortgagor shall deliver to Mortgagee, within 120 days after the end of
each fiscal year of Mortgagor, a Mortgagor's Certificate stating that
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(a) a review of the activities of Mortgagor during such year and of
performance under this Senior Guarantee Mortgage has been made under the
signer's supervision, and
(b) to the best of each signer's knowledge, based on such review,
Mortgagor has fulfilled all of Mortgagor's obligations under this Senior
Guarantee Mortgage throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to him
and the nature and status thereof.
Promptly after Mortgagor may reasonably be deemed to have knowledge of a
default hereunder, Mortgagor shall deliver to Mortgagee a notice specifying the
nature and period of existence thereof and the action Mortgagor is taking and
proposes to take with respect thereto.
Section 5.14. To Keep Books; Inspection by Mortgagee.
Mortgagor will keep proper books of record and account, in which full and
correct entries shall be made of all dealings or transactions of or in relation
to the properties, business and affairs of Mortgagor in accordance with
generally accepted accounting principles consistently applied. Said books shall
be maintained in an office located either in Atlantic City, New Jersey or in the
Borough of Manhattan, City of New York, State of New York. Mortgagor shall at
any and all times, upon request of Mortgagee and at the expense of Mortgagor,
permit Mortgagee and its representatives to inspect the Casino Hotel and any
other buildings, structures and improvements now or hereafter located on the
Land and the books of account, records, reports and other papers of Mortgagor,
and to make copies and extracts therefrom, and will afford and procure a
reasonable opportunity to make any such inspection (provided, that any such
inspection shall not unreasonably interfere with the business operations of
Mortgagor), and Mortgagor will furnish to Mortgagee any and all information as
Mortgagee may reasonably request, with respect to the performance by Mortgagor
of its covenants in this Senior Guarantee Mortgage.
Section 5.15. Advances by Mortgagee.
If Mortgagor shall fail to perform any of the covenants, terms, provisions
or conditions contained in this Senior Guarantee Mortgage and such failure shall
continue for 10 days following notice thereof given by Mortgagee (or at any
time, without notice, in case of emergency), Mortgagee may (but is not obligated
to), at any time and from time to time, take any action or make advances, to
effect performance of any such covenant, term, provision or condition on behalf
of Mortgagor; and all moneys so used, paid or advanced by Mortgagee and all
reasonable costs and expenses incurred by Mortgagee in connection therewith,
together with interest on all of the same at the rate of interest set forth in
the Senior Notes, shall be immediately due and payable by Mortgagor to Mortgagee
and all such moneys, costs and expenses shall be secured by the lien of this
Senior Guarantee Mortgage prior to the Senior Notes. No such advance or payment
by Mortgagee shall relieve Mortgagor from any default hereunder or impair any
right or remedy of Mortgagee.
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Section 5.16. Waiver of Stay, Extension or Usury Laws.
Mortgagor covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any usury, stay or extension law or any other
law which would prohibit or forgive Mortgagor from paying all or any portion of
the obligations secured by this Senior Guarantee Mortgage, wherever enacted, now
or at any time hereafter in force, or which may otherwise affect the covenants
or the performance of this Senior Guarantee Mortgage; and Mortgagor (to the
extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to Mortgagee, but shall suffer
and permit the execution of every such power as though no such law had been
enacted.
Section 5.17. Eminent Domain.
(a) Mortgagor shall notify Mortgagee immediately upon obtaining knowledge
of any Taking affecting the Trust Estate or any part thereof. If the Taking is a
Taking of less than the whole or substantially all of the Premises but (i) is
estimated to result in an award of more than $10,000,000 or (ii) the Taking will
interfere with or adversely affect the operation of the Casino Hotel (other than
any portion thereof consisting solely of unimproved, paved or unpaved surface
parking) other than to a de minimis extent, then within 30 days after such
Taking, Mortgagor shall deliver to Mortgagee a certificate of an Architect
stating whether, in such Architect's opinion, applicable Legal Requirements
permit the Restoration of any buildings and improvements for the same uses and
to the same size and quality in all material respects as existed immediately
prior to the Taking (and if said certificate states that Legal Requirements do
not permit such Restoration, said certificate shall describe the manner closest
approximating such criteria to which the buildings and improvements could be so
restored and shall be accompanied by a Certificate of Appraised Value dated not
more than 10 days prior to delivery setting forth the Appraised Value
immediately prior to the Taking and the estimated Appraised Value immediately
after the permitted Restoration). If Mortgagor is required to deliver such
Certificate of Appraised value and if based on such Certificate of Appraised
Value immediately after Restoration, (i) the Outstanding Amount of Indebtedness
of the Mortgagor, the Company or TCHI immediately after such Restoration shall
exceed the greater of (A) 80% of the Appraised Value immediately after such
Restoration or (B) the quotient of the Outstanding Amount of Indebtedness of the
Mortgagor, the Company or TCHI immediately prior to such Taking divided by the
Appraised Value immediately prior to the Taking multiplied by the Appraised
Value immediately after such Restoration, or (ii) applicable Legal Requirements
do not permit the Restoration of the Casino Hotel for use as a casino and hotel
complex, then, in any of such events, the Taking shall be deemed a Taking of
"the whole or substantially all of the Premises." The Taking shall be deemed a
Taking of "less than the whole or substantially all of the Premises" if
Mortgagor is not required to deliver a Certificate Of Appraised Value or if, at
the time of delivery of such Certificate, neither of the tests set forth in
clauses (i) and (ii) is met.
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(b) If at any time there shall occur a Taking of less than the whole or
substantially all of the Premises and the award or awards resulting therefrom
payable to Mortgagor (and not to any lessor under any Facility Lease) (after
there shall have been first deducted the fees and expenses incurred in
connection with the termination, settlement and collection of such award or
awards, including, without limitation, reasonable counsel fees and expenses,
hereinafter referred to as "Settlement Costs") (i) shall be less than
$10,000,000 (except to the extent that the Insurance Trustee is required to hold
such amount pursuant to a Superior Instrument Requirements), the entire amount
of such award shall be paid to Mortgagor; and (ii) if such award is $10,000,000
or more, the entire amount of such award shall be paid to the Insurance Trustee.
In either event, such awards shall be applied to the cost of Restoration of the
Trust Estate as nearly as practicable to their uses, value and condition
immediately prior to the Taking (except to the extent otherwise provided by
Superior Instrument Requirements). Mortgagor shall promptly commence and with
due diligence perform the Restoration in accordance with clauses (iii), (iv) and
(vii) of Subsection 5.10(e) (after substituting the words "Taking" for
"Casualty" and "award" for "net insurance proceeds"), at no cost to Mortgagee.
All claims or suits arising out of any Taking may be settled by Mortgagor,
except that Mortgagee shall have the right (but not the obligation) to
participate in such claim or suit, and to approve settlement thereof (and
notwithstanding anything in the Facility Leases to the contrary, Mortgagor shall
not agree to any settlement or compromise of the amount of any such claim or
suit, except a claim or suit where the amount reasonably anticipated to be
received by Mortgagor is less than $5,000,000). If Mortgagee at its election as
aforesaid joins such claim or suit, Mortgagee's approval of such settlement
shall not be unreasonably withheld. The Insurance Trustee shall promptly pay
such sums as are received by it from such Taking from time to time in accordance
with the procedures set forth in clauses (v) and (vi) of Subsection 5.10(e)
(after substituting the words "Taking" for "Casualty" and "award" for "net
insurance proceeds").
(c) If at any time there shall occur a Taking of the whole or
substantially all of the Premises, then the award payable to Mortgagor shall not
be applied to Restoration but shall instead be paid and delivered to the Trustee
(subject to the rights of the lessors under any Facility Leases) to the extent
of the then Outstanding Amount of the Senior Notes and any other interest or
other sums due hereunder or thereunder to be applied to the satisfaction of this
Senior Guarantee Mortgage to the extent proceeds are available for such purpose
and provided that no additional sums are due to the trustee or the holders under
the Senior Note Indenture, the Senior Notes, the Senior Guarantee, the TCHI Note
Indenture, the TCHI Notes, the TCHI Guarantee, the Mortgage Notes or the
Mortgage Note Indenture, the balance of the award shall be paid to Mortgagor.
(d) Notwithstanding anything contained herein to the contrary, if an Event
of Default shall have occurred and is continuing, Mortgagee may, at its option,
(i) refrain from paying to Mortgagor or the Insurance Trustee any award or (ii)
instruct the Insurance Trustee to pay to Mortgagee any award then held by the
Insurance Trustee, as the case may be.
Section 5.18. Facility Leases.
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(a) Mortgagor shall do or cause to be done all things necessary to
preserve and keep unimpaired the rights of Mortgagor, as lessee under all
Facility Leases, and, to prevent any termination, surrender, cancellation,
forfeiture or impairment of any thereof. Mortgagor shall at all times fully
perform and comply with all agreements, covenants, terms and conditions imposed
upon or assumed by it as lessee under each of the Facility Leases (including,
without limitation, the covenant to pay rent and all taxes, assessments and
other charges mentioned therein) prior to the expiration of any notice and/or
cure period provided in each such Facility Lease. Upon receipt by Mortgagee from
a Lessor of any written notice of default by the lessee thereunder, Mortgagee
may rely thereon and take any action Mortgagee deems necessary in its sole
discretion to prevent or to cure any default by Mortgagor in the performance of
or compliance with any of the agreements, covenants, terms or conditions imposed
upon or assumed by Mortgagor as lessee under such Facility Lease, even though
the existence of such default or the nature thereof be questioned or denied by
Mortgagor or by any party on behalf of Mortgagor. Without limiting the
generality of Section 3.9, Mortgagor hereby expressly grants to Mortgagee, and
agrees that Mortgagee shall have, the absolute and immediate right to enter in
and upon the Premises or any part thereof to such extent and as often as
Mortgagee, in its sole discretion, deems necessary or desirable for the purpose
permitted by the immediately preceding sentence, subject only to applicable
Legal Requirements. Without limiting Mortgagor's obligations or Mortgagee's
rights set forth above or limiting Mortgagee's other remedies under this Senior
Guarantee Mortgage, Mortgagee may pay and expend such sums of money as Mortgagee
in its sole discretion deems necessary for any such purpose, and Mortgagor
hereby agrees to pay to Mortgagee immediately and without demand, all such sums
referred to above, so paid and expended by Mortgagee, together with interest
thereon from the date of each such payment at the highest rate of interest set
forth in the Senior Notes. All sums so paid and expended by Mortgagee, and the
interest thereon, shall be added to and be secured by the lien of this Senior
Guarantee Mortgage.
(b) Mortgagor further covenants and agrees as follows:
(i) Mortgagor shall not surrender, terminate or cancel any Facility
Lease, and shall not without the consent of Mortgagee modify, change,
supplement, alter or amend any Facility Lease either orally or in writing
if an impairment of the security granted under this Senior Guarantee
Mortgage would result therefrom. As further security for the repayment of
the indebtedness secured hereby and for the performance of the covenants
herein and in each Facility Lease contained, Mortgagor hereby assigns to
Mortgagee all of Mortgagor's rights, privileges and prerogatives as lessee
under each Facility Lease to terminate, cancel, modify, change,
supplement, alter or amend such Facility Lease and any such termination,
cancellation, modification, change, supplement, alteration or amendment of
a Facility Lease without the prior consent thereto by Mortgagee shall be
void and of no force and effect. Unless (1) an Event of Default has
occurred and is continuing and (2) either (A) there has been an
acceleration of maturity of the Senior Partnership Note pursuant to
Section 3.2 or (B) Mortgagee exercises its rights under
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Section 3.9, Mortgagee shall have no right to terminate, cancel, modify,
change, supplement, alter or amend any Facility Lease.
(ii) Solely for the benefit of Mortgagee, Trustee, the Holders and
no other person, no release or forbearance of any of Mortgagor's
obligations under any Facility Lease, pursuant to such Facility Lease or
otherwise, shall release Mortgagor from any of Mortgagor's other
obligations under this Senior Guarantee Mortgage.
(iii) Unless Mortgagee shall otherwise expressly consent in writing,
the fee title to the Leased Facilities and Mortgagor's leasehold estates
therein shall not merge and shall always remain separate and distinct,
notwithstanding the union of said estates either in the Lessor or in the
lessee, or in a third party by purchase or otherwise
(iv) Mortgagor shall promptly notify Mortgagee in writing of any
request made by Mortgagor, as lessee under any Facility Lease, or any of
the Lessors, for arbitration proceedings under any Facility Lease and of
the institution of any arbitration proceedings, as well as all proceedings
thereunder. Mortgagor shall promptly deliver to Mortgagee a copy of the
determination of the arbitrators in each such arbitration proceeding.
Mortgagee shall have the right to participate in such arbitration
proceedings in association with Mortgagor or on its own behalf as an
interested party.
(v) Mortgagor shall not consent to the subordination of any Facility
Lease to any mortgage, deed of trust or other lien on the fee interest of
the Lessor.
(vi) If Mortgagor acquires fee simple title or any other estate,
title or interest in any Leased Facility, Mortgagor shall promptly notify
Mortgagee of such acquisition and, on request by Mortgagee, shall cause to
be executed and recorded all such other and further assurances or other
instruments in writing as may in the opinion of Mortgagee be required or
desirable to carry out the intent and meaning of clause (x) of Granting
Clause Third.
(vii) Within 5 days after Mortgagor's receipt of any notice of any
motion, application or effort to reject any Facility Lease by any Lessor
or any trustee arising from or in connection with any case, proceeding or
other action commenced or pending by or against any Lessor under the Code
or any comparable provision contained in any present or future federal,
state, local, foreign or other statute, law, rule or regulation
("Comparable Provision"), Mortgagor shall give notice thereof to
Mortgagee. Mortgagor hereby (A) assigns to Mortgagee any and all of
Mortgagor's rights as lessee under Section 365(h) of the Code or any
Comparable Provision and (B) covenants that it shall not elect to treat
any Facility Lease as terminated pursuant to Section 365(h) of the Code or
any Comparable Provision without the prior consent of Mortgagee and (C)
agrees that any such election by Mortgagor without such consent shall be
null and void.
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(viii) Without limiting the generality of the foregoing, to the
extent permitted by applicable law, Mortgagor hereby unconditionally
assigns, transfers and sets over to Mortgagee all of Mortgagor's claims
and rights to the payment of damages arising from any rejection by Lessor
of any Facility Lease under the Code or any Comparable Provision.
Mortgagee shall have the right to proceed in its own name or in the name
of Mortgagor in respect of any claim, suit, action or proceeding relating
to the rejection of any Facility Lease, including, without limitation, the
right to file and prosecute, in cooperation with Mortgagor, any proofs of
claim, complaints, motions, applications, notices and other documents, in
any case in respect of Lessor under the Code or any Comparable Provision.
This assignment constitutes a present, irrevocable and unconditional
assignment of the foregoing claims, rights and remedies, and shall
continue in effect until all of the indebtedness and obligations secured
by this Senior Guarantee Mortgage shall have been satisfied and discharged
in full. Any amounts received by Mortgagee in damages arising out of the
rejection of any Facility Lease as aforesaid shall be applied first to all
reasonable costs and expenses of Mortgagee (including, without limitation,
reasonable attorneys' fees, disbursements and court costs) incurred in
connection with the exercise of any of its rights or remedies under this
Section 5.18, and thereafter as provided in Section 3.3.
(ix) If there shall be filed by or against Mortgagor a petition
under the Code or any Comparable Provision and Mortgagor, as lessee under
any Facility Lease, shall determine to reject such Facility Lease,
Mortgagor shall give Mortgagee not less than 10 days' prior notice of the
date on which Mortgagor shall apply to the Bankruptcy Court or other
judicial body with appropriate jurisdiction for authority to reject such
Facility Lease. Mortgagee shall have the right, but not the obligation, to
serve upon Mortgagor within such 10-day period a notice stating that (a)
Mortgagee demands that Mortgagor assume and assign such Facility Lease to
Mortgagee pursuant to Section 365 of the Code or any Comparable Provision
and (b) Mortgagee covenants to cure or provide adequate assurance of
prompt cure of all defaults and provide adequate assurance of future
performance under such Facility Lease. If Mortgagee serves upon Mortgagor
the notice described in the preceding sentence, Mortgagor shall not seek
to reject such Facility Lease and shall comply with the demand provided
for in clause (a) of the preceding sentence within 30 days after the
notice shall have been given subject to the performance by Mortgagee of
the covenant provided for in clause (b) of the preceding sentence. The
foregoing provisions of this Section 5.18(ix) shall not apply to the
extent not permitted by applicable law. Effective upon the entry of an
order for relief in respect of Mortgagor under Chapter 7 of the Code or
any Comparable Provision, Mortgagor hereby assigns and transfers to
Mortgagee a non-exclusive right to apply to the Bankruptcy Court or other
judicial body with appropriate jurisdiction for an order extending the
period during which such Facility Lease may be rejected or assumed.
(x) Mortgagor shall promptly give to Mortgagee copies of (A) all
notices of default and (B) any other communications or notices with
respect to events that relate to
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the possible impairment of the security of this Senior Guarantee Mortgage,
which Mortgagor shall give or receive under any Facility Lease and shall
promptly notify Mortgagee of any default under any Facility Lease on the
part of the Lessor or Mortgagor.
(xi) Mortgagor shall enforce with due diligence all of the
obligations of the Lessor under each Facility Lease, to the end that
Mortgagor may enjoy all of the rights and privileges granted to it under
the Facility Leases.
(xii) Mortgagor shall notify Mortgagee within 5 days after the
transfer of a fee interest in any Leased Facility or any portion thereof
to or from an Affiliate.
(xiii) No Affiliate of Mortgagor shall at any time hereafter acquire
fee title to the Leased Land or any portion thereof unless simultaneously
with such acquisition such Affiliate and Mortgagor execute and exchange
(and deliver to the Trustee an executed counterpart of) an instrument in
form and substance satisfactory to Mortgagee providing that so long as
such Affiliate owns such fee title (A) such Affiliate shall not terminate
the applicable Facility Lease for any reason whatsoever (including,
without limitation, due to the default of Mortgagor under such Facility
Lease) and (B) such Affiliate shall not accept, and, if tendered by
Mortgagor shall promptly return to Mortgagor, any payment of rent or other
charges payable under such Facility Lease in excess of the amount required
to pay the debt service and other sums payable under any mortgage
affecting such Affiliate's fee interest in the applicable Leased Facility
(and such Affiliate shall use such funds only to pay its debt service
obligations and other sums payable under such mortgage) at any time that
an Event of Default, or a Default of the types described in Section
3.1(a), (b) and (f) of this Senior Guarantee Mortgage or Section 5.1(a),
(b), (f) or (g) of the Senior Note Indenture, shall have occurred and be
continuing under this Senior Guarantee Mortgage or the Senior Note
Indenture.
(c) Subject to the provisions of Subsection 5.18(b)(iii), if both the
lessor's and lessee's estates under any Facility Lease or any portion thereof
shall at any time become vested in one owner, this Senior Guarantee Mortgage and
the lien created hereby shall nevertheless not be destroyed or terminated by
application of the doctrine of merger and, in such event, Mortgagee shall
continue to have all of the rights and privileges of a first leasehold
mortgagee.
(d) Mortgagor hereby acknowledges that if any Facility Lease shall be
terminated prior to the natural expiration of its term due to default by the
lessee thereunder, and if pursuant to such Facility Lease, Mortgagee or its
designee shall acquire from the Lessor a new lease of the Leased Facility or any
portion thereof, Mortgagor shall have no right, title or interest in or to such
lease or the leasehold estate created thereby, or the options therein contained.
(e) Each Facility Lease hereafter entered into or assumed by Mortgagor as
lessee or sublessee shall contain provisions (i) permitting the assignment of
the same to Mortgagee and the
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Trustee and permitting assignment without the lessor's consent if this Senior
Guarantee Mortgage is foreclosed; and (ii) providing protection to Mortgagee, as
leasehold mortgagee, in form reasonably satisfactory to Mortgagee.
Section 5.19. Indemnification.
Mortgagor shall protect, indemnify, hold harmless and defend Mortgagee and
its directors, officers, partners, shareholders, agents, servants and employees
from and against any and all liabilities, obligations, claims, damages,
penalties, causes of action, costs and expenses (including, without limitation,
reasonable attorneys' fees, disbursements and court costs), imposed upon or
incurred by or asserted against Mortgagee by reason of (a) any injury to or
death of Persons or loss of or damage to property occurring on or about the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (b) any use, nonuse or condition of the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (c) any failure on the part of
Mortgagor to perform or comply with any of the terms of this Senior Guarantee
Mortgage, (d) performance of any labor or services or the furnishing of any
materials or other property in respect of the Premises or any part thereof made
or suffered to be made by or on behalf of Mortgagor, (e) any negligence or
tortious act on the part of Mortgagor or any of its agents, contractors,
lessees, licensees or invitees, or (f) any work in connection with the Premises;
provided, that no amounts shall be payable to Mortgagee under this Section 5.19
in respect of liabilities, obligations, claims, damages, penalties, causes of
action, costs or expenses imposed upon or incurred by or asserted against
Mortgagee to the extent the same result from any negligence or tortious act on
the part of Mortgagee or any of its agents, contractors, lessees, licensees or
invitees. All amounts payable to Mortgagee under this Section 5.19 shall be
payable on demand; provided, that with respect to consequential damages (other
than attorneys' fees, disbursements and court costs imposed upon or incurred by
Mortgagee in connection therewith, which shall in all events be payable on
demand), no such amounts shall be payable until, and to the extent that, (i)
there has been entered the final determination of a court of competent
jurisdiction awarding such consequential damages to the party or parties seeking
such damages or (ii) an agreement of settlement with respect thereto (which
shall have been previously approved by Mortgagor, such consent not to be
unreasonably withheld) shall have been executed by Mortgagee and such party or
parties. Any such amounts which are not paid within 5 days after demand therefor
by Mortgagee shall bear interest at the rate set forth in the Senior Notes from
the date of such demand and all such amounts and interest thereon shall be
secured by the lien of this Senior Guarantee Mortgage. In case any action, suit
or proceeding is brought against Mortgagee by reason of any such occurrence,
Mortgagor, upon request of Mortgagee, shall, at Mortgagor's expense, resist and
defend such action, suit or proceeding or cause the same to be resisted or
defended by counsel designated by Mortgagor and approved by Mortgagee, which
approval shall not be unreasonably withheld; provided, that Willkie, Farr &
Gallagher is hereby approved by Mortgagee.
Section 5.20. TCHI Mortgages.
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(a) Mortgagor shall at all times fully perform and comply with all
agreements, covenants, terms and conditions imposed upon or assumed by it as
mortgagor under the TCHI Mortgages prior to the expiration of any notice and/or
cure period provided in each such TCHI Mortgage. If a notice of default has been
given by the holder of the TCHI Mortgages, Mortgagee may rely thereon and take
any action Mortgagee deems necessary in its sole discretion to prevent or to
cure any default by Mortgagor in the performance of or compliance with any of
the agreements, covenants, terms or conditions imposed upon or assumed by
Mortgagor as mortgagor (or assignee of the Mortgagor) under the TCHI Mortgages
even though the existence of such default or the nature thereof be questioned or
denied by Mortgagor or by any party on behalf of Mortgagor. Without limiting the
generality of Section 3.9, Mortgagor hereby expressly grants to Mortgagee, and
agrees that Mortgagee shall have, the absolute and immediate right to enter in
and upon the Premises or any part thereof to such extent and as often as
Mortgagee, in its sole discretion, deems necessary or desirable for the purpose
permitted by the immediately preceding sentence, subject only to applicable
Legal Requirements. Without limiting Mortgagor's obligations or Mortgagee's
rights set forth above or limiting Mortgagee's other remedies under this
Mortgage, Mortgagee may (i) pay and expend such sums of money as Mortgagee in
its sole discretion deems necessary or desirable for any such purpose and (ii)
in its sole discretion prepay the TCHI Mortgages then in default, and Mortgagor
hereby agrees to pay to Mortgagee immediately and without demand, all such sums
referred to in (i) and (ii) above so paid and expended by Mortgagee, together
with interest thereon from the date of each such payment at the highest rate of
interest set forth in the TCHI Notes. All sums so paid and expended by Mortgagee
and the interest thereon, shall be added to and be secured by the lien of this
Mortgage.
(b) Mortgagor further covenants and agrees:
(i) Mortgagor shall not, without first obtaining the consent of
Mortgagee in each instance: (A) modify, replace or refinance the TCHI
Mortgages if (x) the collateral securing the lien thereof would be
increased thereby (other than after-acquired property required by the
terms of the TCHI Mortgages to be encumbered thereby) or (y) such
modification, replacement or refinancing violates any other provision of
this Senior Note Mortgage or the Senior Note Indenture or (B) acquire or
permit or suffer any Affiliate of Mortgagor to acquire the TCHI Mortgages
or any Interest therein;
(ii) Mortgagor shall timely pay and perform all of the obligations
to be paid or performed by the mortgagor under the TCHI Mortgages, the
notes secured thereby and any other instrument evidencing or securing the
indebtedness owing to any holder of the TCHI Mortgages;
(iii) at any time and from time to time, Mortgagor shall upon
request of Mortgagee promptly use its reasonable efforts to obtain an
estoppel certificate or letter addressed to Mortgagee from the holder of
the TCHI Mortgages, such certificate or letter to be in such form as
Mortgagee shall reasonably request;
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(iv) Mortgagor shall promptly give to Mortgagee copies of (A) all
notices of default or (B) any other notice or communication with respect
to events which relate to the possible impairment of the security of this
Mortgage, which Mortgagor shall give or receive under the TCHI Mortgages
and shall promptly notify Mortgagee of any default under the TCHI
Mortgages on the part of Mortgagor.
[Remainder of this Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed and attested, all as of the day and year first above written.
TRUMP'S CASTLE ASSOCIATES, L.P.,
a New Jersey limited partnership
By: Trump's Castle Hotel & Casino, Inc.,
its general partner
Witness: /s/ Henry Smokler By: /s/ Nicholas L. Ribis
---------------------- ------------------------
Henry Smokler Name: Nicholas L. Ribis
Title: President and Chief
Executive Officer
U.S. BANK NATIONAL ASSOCIATION,
a national banking association
Witness: /s/ Carol Leslie By: /s/ Richard H. Prokosch
------------------------ -------------------------
Carol Leslie Name: Richard H. Prokosh
Title: Assistant Vice President
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<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the President and Chief Executive Officer of TRUMP'S CASTLE
HOTEL & CASINO, INC., the general partner of TRUMP'S CASTLE ASSOCIATES, L.P.,
who I am satisfied is the person who executed the within instrument and he
acknowledged that he signed and delivered the same as such officer on behalf of
such entity and that the within instrument is the voluntary act and deed of said
corporation made by virtue of the authority of its board of directors.
/s/ Marcus Chioffi
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of Mortgage
and Security Agreement from Trump's Castle Associates to Trump's Castle Funding,
Inc. dated as of December 28, 1993 and recorded in the Atlantic County Registry
of Deeds in Mortgage Book 5238, Page 1, the mortgagee's interest in which was
assigned to First Bank National Association, now known as U.S. Bank National
Association, as trustee under the Mortgage Note Indenture, by a certain Senior
Assignment Agreement dated as of December 28, 1993 and recorded in the Atlantic
County Registry of Deeds in Assignment Book 651, Page 160 (the "Subordinate
Associates Mortgage") hereby consents to and acknowledges the provisions of the
foregoing Senior Guarantee Mortgage and hereby subordinates the lien created by
the Subordinate Associates Mortgage to this Senior Guarantee Mortgage.
U.S.BANK NATIONAL ASSOCIATION, a national
banking association
Witness: /s/ Carol Leslie By: /s/ Richard H. Prokosch
----------------------- -----------------------
Name: Carol Leslie Name: Richard H. Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of Mortgage
and Security Agreement from Trump's Castle Associates to First Bank National
Association as trustee under the Mortgage Note Indenture, now known as U.S. Bank
National Association, as trustee under the Mortgage Note Indenture, dated as of
December 28, 1993 and recorded in the Atlantic County Registry of Deeds in
Mortgage Book 5239, Page 1 (the "Subordinate Mortgage") hereby consents to and
acknowledges the provisions of the foregoing Senior Guarantee Mortgage and
hereby subordinates the lien created by the Subordinate Mortgage to this Senior
Guarantee Mortgage.
U.S.BANK NATIONAL ASSOCIATION, a national
banking association
Witness: /s/ Carol Leslie By: /s/ Richard H. Prokosch
---------------------------- ------------------------
Name: Carol Leslie Name: Richard H. Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- --------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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SCHEDULE 1
OWNED LAND
All the real property located in the City of Atlantic City, County of Atlantic,
and State of New Jersey and more particularly described as follows:
CASINO-HOTEL PARCEL
All that certain real property hereinafter particularly described situate, lying
and being in the City of Atlantic City, County of Atlantic and State of New
Jersey.
BEGINNING at the point of intersection of the northwesterly line of Huron Avenue
(100 feet wide) and the northeasterly line of the Atlantic - Brigantine
Boulevard, said Boulevard also known as State Highway Route 87, and extending;
thence
1. North 45 degrees 50 minutes 06 seconds West, in and along the
Atlantic-Brigantine Boulevard, 56.63 feet; thence
2. North 19 degrees 16 minutes 38 seconds East, still in and along said
Boulevard, 81.94 feet to a point of curve; thence
3. Curving to the right in the arc of a circle having a radius of 783.00
feet, the arc length of 72.815 feet to a point of reverse curve; thence
4. Curving to the left in the arc of a circle having a radius of 837.00
feet, the arc length of 77.836 feet to another point of reverse curve; thence
5. Curving to the right in the arc of a circle having a radius of 2946.00
feet,, the arc length of 1017.42 feet to a point; thence
6. North 44 degrees 34 minutes 15 seconds East, 135.02 feet to a point of
curve; thence
7. Curving to the right in the arc of a circle having a radius of 2936.00
feet, the arc length of 105.48 feet to a point; thence
8. South 27 degrees 28 minutes 00 seconds East, at right angles to Huron
Avenue 842.02 feet to the northwesterly line of Huron Avenue; thence
9. South 62 degrees 32 minutes 00 seconds West, in and along the
northwesterly line of Huron Avenue, 1229.40 feet to the point and place of
BEGINNING.
1-1
<PAGE>
EXCEPTING THEREOUT AND THEREFROM the property which was conveyed to the State of
New Jersey by the Deeds recorded in Deed Book 3980 page 180 and in Deed Book
4031 page 299.
BEING ALSO KNOWN AND DESIGNATED as Lot 9 in Block H-19 on the Official Tax Map
of the City of Atlantic City.
PARKING FACILITIES PARCEL
BEGINNING at a point in Beach Thorofare at the easterly corner of the parcel of
lands containing an area of 6.199 acres more or less which was conveyed by the
West Jersey and Seashore Railroad Company to the Press Union Publishing Company
by deed dated January 9, 1940, and recorded January 17, 1940 in Deed Book 1099
page 420, said beginning point being South 24 degrees 54 minutes 00 seconds
West, a distance of 100.16 feet from a monument set in the southeasterly line of
Absecon Boulevard (also known as U.S. Route 30) (190 feet wide), and extending
from said beginning point; thence,
(1) In Beach Thorofare, South 24 degrees 54 minutes 00 seconds West, a
distance of 259.81 feet to a point; thence
(2) Continuing in and along same, South 44 degrees 54 minutes 00 seconds West,
a distance of 445.50 feet to a point; thence,
(3) Continuing in and along same, South 72 degrees 24 minutes 00 seconds West,
a distance of 224.40 feet to a point; thence
(4) Continuing in and along same, North 68 degrees 21 minutes 00 seconds West,
a distance of 478.50 feet to a point; thence
(5) Continuing in and along same, North 76 degrees 06 minutes 00 seconds West,
a distance of 363.00 feet to a point; thence
(6) Continuing in and along same, South 82 degrees 39 minutes 00 seconds West,
a distance of 429.00 feet to a point; thence,
(7) Continuing in and along same, North 17 degrees 59 minutes 20 seconds East,
a distance of 320.65 feet to a point located in the approximate high water
line of Beach Thorofare, said point also being a corner of lands now or
formerly in Daniel Adams, et al, as recorded in Deed Book CC Page 272;
thence,
(8) North 39 degrees 01 minutes 00 seconds West, leaving Beach Thorofare, in
and along the line of lands now or formerly of Daniel Adams, et al, a
distance of 1089.00 feet to a point in the southeasterly line of lands now
or formerly of Lot 307 in Block 201 as shown on the current
<PAGE>
Official Tax Map for the City of Atlantic City, said point also being a
corner to lands now or formerly of Daniel Adams, et al; thence,
(9) North 57 degrees 59 minutes 00 seconds East, in and along the said lands,
a distance of 1113.19 feet to a point in the aforesaid southwesterly line
of Absecon Boulevard; thence,
(10) South 22 degrees 46 minutes 10 seconds East, in and along same, a distance
of 185.42 feet to a point of curve; thence,
(11) Southeastwardly, in and along same and in the arc of a circle curving to
the left having a radius of 1527.69 feet the arc length of 213.90 feet to
a point in the northwesterly line of Lot 230 in said Block 201; thence,
(12) South 09 degrees 08 minutes 24 seconds East, in the southwesterly line of
Absecon Boulevard, a distance of 87.75 feet to a point of curve; thence
(13) Curving to the left along the line of Absecon Boulevard, in the arc of a
circle having a radius of 332.00 feet, the arc length of 201.61 feet to a
point of tangent; thence
(14) South 43 degrees 56 minutes 03 seconds East, continuing in and along the
southwesterly line of Absecon Boulevard, a distance of 128.55 feet to a
point; thence
(15) South 82 degrees 36 minutes 59 seconds East, continuing in and along the
said southwesterly line of Absecon Boulevard, a distance of 10.00 feet to
a point; thence
(16) Curving to the right along the line of Absecon Boulevard, in the arc of a
circle having a radius of 70.00 feet, the arc length of 47.26 feet to a
point of tangent; thence
(17) North 46 degrees 03 minutes 57 seconds East, along the line of Absecon
Boulevard, a distance of 20.81 feet to a point which is radially distant
95.00 feet from the centerline of Absecon Boulevard (190 feet wide) at
station 335+98.63 feet; thence
(18) Curving to the left in the Southwesterly line of Absecon Boulevard in the
arc of a circle having a radius of 1527.69 feet, the arc length of 70.33
feet to the northwesterly line of Lot 230 in said Block 201; thence
(19) South 41 degrees 59 minutes 00 seconds West, in and along same, a distance
of 125.00 feet to the extreme westerly corner of said Lot 230; thence
(20) Southeastwardly, in and along the southwesterly line of same, concentric
with Absecon Boulevard, in the arc of a circle curving to the left, having
a radius of 1652.69 feet, the arc length of 324.55 feet to the extreme
southeasterly corner of said Lot 230; thence
<PAGE>
(21) North 30 degrees 43 minutes 55 seconds East, in and along the
southeasterly line of same, a distance of 125.00 feet to a point in the
aforesaid southwesterly line of Absecon Boulevard; thence
(22) Southeastwardly, in and along same and in the arc of a circle curving to
the left, having a radius of 1527.69 feet, the arc length of 245.58 feet
to a point of tangency; thence
(23) South 68 degrees 22 minutes 10 seconds East, in and along same, a distance
of 50.00 feet to a point in the westerly line of the previously mentioned
6.199+/- acre parcel, also being the northwesterly line of Lot 150 in said
Block 201; thence
(24) South 21 degrees 38 minutes 00 seconds West, in and along same, a distance
of 100.00 feet to a corner in said Lot 150; thence
(25) Continuing in and along same, North 68 degrees 22 minutes 10 seconds West,
a distance of 94.75 feet to a corner; thence
(26) Continuing in and along same, South 27 degrees 48 minutes 00 seconds West,
a distance of 89.04 feet to a corner; thence
(27) Continuing in and along same, South 54 degrees 39 minutes 00 seconds West,
a distance of 65.88 feet to a corner; thence
(28) Continuing in and along same, South 71 degrees 53 minutes 00 seconds West,
a distance of 201.55 feet to a corner; thence
(29) Continuing in and along same, South 51 degrees 29 minutes 00 seconds East,
a distance of 172.09 feet to a corner; thence
(30) Continuing in and along same, South 25 degrees 20 minutes 00 seconds East,
a distance of 216.73 feet to a corner; thence
(31) Continuing in and along same and crossing the aforesaid high water line of
Beach Thorofare, South 84 degrees 22 minutes 00 seconds East, a distance
of 256.83 feet to a corner; thence
(32) Continuing in and along same, North 79 degrees 58 minutes 00 seconds East,
a distance of 279.10 feet to a corner; thence
(33) Continuing in and along same, North 41 degrees 22 minutes 00 seconds East,
a distance of 266.39 feet to the point and place of BEGINNING.
BEING ALSO KNOWN AND DESIGNATED as Lot 231 in Book 201 on the Official Tax Map
of the City of Atlantic City.
<PAGE>
(PEDESTRIAN BRIDGE)
Air rights, rights of way and easements including the right to construct,
maintain and use a Pedestrian Bridge across Huron Avenue connecting the
Casino-Hotel Parcel with the Farley State Marina Site contained in Ordinance No.
2 of 1988 and affecting the following described premises:
ALL that certain lot, tract, or parcel of land and premises situate, lying, and
being in the City of Atlantic City, County of Atlantic, and State of New Jersey,
bounded and described as follows:
BEGINNING at a point in the southerly line of Huron Avenue (100 feet wide), said
point being distant 956.00 feet eastwardly from the easterly line of Maryland
Avenue (65 feet wide), if same were extended northwardly, and extending from
said beginning point; thence
(1) North 27 degrees 28 minutes 00 seconds West, crossing Huron Avenue, a
distance of 100.00 feet to the northerly line of Huron Avenue; thence
(2) North 62 degrees 32 minutes 00 seconds East, in and along the northerly
line of Huron Avenue, a distance of 30.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, crossing Huron Avenue, a
distance of 100.00 feet to the southerly line of Huron Avenue; thence
(4) South 62 degrees 32 minutes 00 seconds West, in and along the southerly
line of Huron Avenue, a distance of 30.00 feet to the point and place of
BEGINNING.
BEING an area above the horizontal plane of Huron Avenue between the elevation
of 25.00 M.S.L. datum and 50.00 M.S.L. datum.
<PAGE>
SCHEDULE 2
LEASED LAND
THE FARLEY STATE MARINA SITE
Beginning at the southeasterly corner of Maryland Avenue (68.00 feet wide
and Huron Avenue 100.00 feet wide) and extending from said beginning point;
thence
(1) South 27 degrees 28 minutes 00 seconds East, in and along the
easterly line of Maryland Avenue, a distance of 804.15 feet; thence
(2) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, a distance of 200.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, parallel with
Maryland Avenue, a distance of 1060.85 feet to a point distant
1745.00 feet northwardly at right angles from the northerly line of
Mediterranean Avenue (60.00 feet wide), said point being in the
fifth course as recited in the Riparian Grant from the State of New
Jersey to the City of Atlantic City, dated March 15, 1920 and
recorded in the Clerk's Office of Atlantic County in Book 632 of
Deeds, Page 117, etc.; thence
(4) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, and in and along said aforementioned Riparian Grant Line, a
distance of 25.00 feet; thence
(5) North 27 degrees 28 minutes 00 seconds West, parallel with
Maryland Avenue, and in and along said aforementioned Riparian Grant
Line, a distance of 9.26 feet; thence
(6) North 09 degrees 01 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 0.04 feet; thence
(7) North 02 degrees 18 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 590.00 feet;
thence
(8) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, in and along said aforementioned Riparian Grant Line, a
distance of 160.00 feet; thence
(9) North 41 degrees 39 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 255.00 feet;
thence
2-1
<PAGE>
(10) North 47 degrees 34 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 285.00 feet;
thence
(11) North 56 degrees 02 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 360.80 feet to a
point distant 1550.00 feet eastwardly at right angles from the
easterly line of Maryland Avenue; thence
(12) North 27 degrees 28 minutes 00 seconds West, parallel with
Maryland Avenue, a distance of 568.21 feet; thence
(13) North 62 degrees 32 minutes 00 seconds East, parallel with
Huron Avenue, a distance of 200.00 feet to the westerly line of
Rhode Island Avenue (50.00 feet wide); thence
(14) North 27 degrees 28 minutes 00 seconds West, in and along the
westerly line of Rhode Island Avenue, a distance of 570.00 feet to
the southerly line of Huron Avenue; thence
(15) South 62 degrees 32 minutes 00 seconds West, in and along the
southerly line of Huron Avenue, a distance of 1750.00 feet to the
point and place of BEGINNING.
EXCEPTING THEREOUT AND THEREFROM the following parcel of land described as:
MARINE POLICE BUILDING PARCEL
BEGINNING at a point in the westerly line of Rhode Island Avenue (50.00 feet
wide), said point being distant 570.00 feet south of the southerly line of Huron
Avenue (100.00 feet wide) and extending; thence
1. South 62 degrees 32 minutes 00 seconds West, parallel with Huron Avenue,
and in and along the division line between Lot 10 and Lot 11 in Block B-4
as shown on the current taxing plan of the City of Atlantic City, a
distance of 97.97 feet; thence
2. North 27 degrees 28 minutes 00 seconds West, parallel with Rhode Island
Avenue, a distance of 179.00 feet; thence
3. North 62 degrees 32 minutes 00 seconds East, parallel with Huron Avenue, a
distance of 97.97 feet to the Westerly line of Rhode Island Avenue; thence
4. South 27 degrees 28 minutes 00 seconds East, in and along the westerly
line of Rhode Island Avenue, a distance of 179.00 feet to the point and
place of BEGINNING.
ALSO EXCEPTING THEREON AND THEREFROM such land and improvements being referred
to as the 7 berths on K dock, for use of the Marina Law Enforcement Bureau as
further described in the Lease referred to in a Short Form Memorandum of Lease
recorded in Deed Book 5365, Page 211, and
<PAGE>
further shown on survey by Arthur W. Ponzio Co. & Assoc., Inc., dated December
28, 1993 and bearing Job No 18488.
BEING ALSO KNOWN AND DESIGNATED as part of Lot 11 in Block B-4 as shown on the
Official Tax Map of Atlantic City, New Jersey.
<PAGE>
SCHEDULE 3
EXISTING ENCUMBRANCES
1. All matters disclosed in Schedules B and D of the Pro Forma Title Insurance
Policies issued as of the date hereof by Chicago Title Insurance Company
(Numbers 31-131-107-03894 and 31-131-107-03909), First American Title Insurance
Company (Numbers 252242 and 255354) and Commonwealth Land Title Insurance
Company (Numbers L980366 and L980366A);
2. All matters disclosed in Schedule C of the Pro Forma Title Insurance Policies
issued as of the date hereof by Chicago Title Insurance Company (Numbers
31-131-107-03894 and 31-131-107-03909), First American Title Insurance Company
(Numbers 252242 and 255354) and Commonwealth Land Title Insurance Company
(Numbers L980366 and L980366A);
3. All UCC-1 Financing Statements naming Trump's Castle Associates, L.P., as
debtor, and filed prior to April 17, 1998, other than those filed in favor of
(i) Midlantic National Bank, (ii) PNC Bank, N.A., or (iii) First Bank National
Association, as Trustee, under the previously existing Senior Notes;
4. Judgment Number CV-02371-93, entered on September 18, 1997 and Judgment
Number DJ-426844-97, entered on October 20, 1997, both in favor of Amplicon,
Inc.;
5. UCC-1 Financing Statement Number 0018501, filed August 14, 1995, naming
Somerset Ice Co. Inc., as Debtor, and NatWest Bank, N.A., as Secured Party;
6. UCC-1 Financing Statement Number 0017919, filed May 19, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and United Jersey Bank, as
Assignee;
7. UCC-1 Financing Statement Number 0017931, filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and NatWest, as Assignee;
8. UCC-1 Financing Statement Number 0017932 filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and Valley National Bank, as
Assignee;
9. UCC-1 Financing Statement Number 0017933, filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and Bank of New York, as Assignee;
10. Account balances due to Atlantic City Municipal Utilities Authority for the
properties through April 17, 1998.
<PAGE>
SCHEDULE 4
FORM OF NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
THIS AGREEMENT, made as of the ___ day of ________, 199_ by and between
U.S. Bank National Association (hereinafter called "Mortgagee"), having an
office at 180 East Fifth Street, St. Paul, Minnesota 55101, and ________________
a having an office at _______________________________________________________
(hereinafter called "Tenant").
W I T N E S S E T H:
WHEREAS, Mortgagee is the mortgagee under that certain Indenture of
Mortgage dated as of April 17, 1998 (said mortgage, as it may be amended,
increased, renewed, modified, consolidated, replaced, combined, substituted,
severed, split, spread or extended, being hereinafter referred to as the
"Mortgage") between Mortgagee, as mortgagee and Trump's Castle Associates, L.P.,
as mortgagor which encumbers the Trump Marina Hotel Casino and certain other
real property located in Atlantic City, New Jersey, more particularly described
in Exhibit A hereto; and
WHEREAS, Tenant has entered into a certain agreement of lease dated [as
amended by agreements dated] and as it may be hereafter amended from time to
time (the "Lease") covering ______________________________________________ (the
"Demised Premises").
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto agree as follows:
1. Tenant covenants and agrees that the Lease now is and shall at all
times continue to be subject and subordinate in each and every respect to the
Mortgage. Tenant, upon request, shall execute and deliver any certificate or
other instrument which the Mortgagee may reasonably request to confirm said
subordination by Tenant.
2. Tenant certifies that the Lease is presently in full force and effect
and unmodified and no base rent payable thereunder has been paid more than one
(1) Year in advance of its due date, and that no default exists under the Lease
which has continued beyond the expiration of any applicable grace period.
3. As long as Tenant is in compliance with the terms of this Agreement and
no default exists under the Lease which has continued beyond the expiration of
any applicable grace period, Mortgagee shall not name Tenant as a party
defendant to any action for foreclosure or other
<PAGE>
enforcement thereof (unless required by law), nor shall the Lease be terminated
by mortgagee in connection with, or by reason of, foreclosure or other
proceedings for the enforcement of the Mortgage, or by reason of a transfer of
the landlord's interest under the Lease pursuant to the taking of a deed in lieu
of foreclosure (or similar device), nor shall Tenant's use or possession of the
Demised Premises be interfered with by Mortgagee, unless the holder of the
landlord's interest under the Lease (the "Landlord") would have had such right
if the Mortgage had not been made, except that the person acquiring, or
succeeding to the interests of the Landlord as a result of any such action or
proceeding, and such person's successors and assigns (any of the foregoing being
hereinafter referred to as the Successor"), shall not be:
(a) subject to any credits, offsets, defenses or claims which Tenant
might have against any prior landlord; nor
(b) bound by any base rent which Tenant might have paid for more
than the current month to any prior landlord, unless such prepayment shall
have been made with Mortgagee's prior written consent; nor
(c) liable for any act or omission of any prior landlord; nor
(d) bound by any covenant to undertake or complete any improvement
to the Demised Premises or the building forming a part of the Property;
nor
(e) be required to account for any security deposit other than any
security deposit actually delivered to the Successor; nor
(f) liable for any payment to Tenant of any sums, or the granting to
Tenant of any credit, in the nature of a contribution towards the cost of
preparing, furnishing or moving into-the Demised Premises or any portion
thereof.
4. If the interest of the Landlord under the Lease shall be transferred by
reason of foreclosure or other proceedings for enforcement of the Mortgage or
pursuant to a taking of a deed in lieu of foreclosure (or similar device),
Tenant shall be bound to the Successor, and, except as provided in this
Agreement, the Successor shall be bound to Tenant, under all of the terms,
covenants and conditions of the Lease for the balance of the term thereof
remaining, with the same force and effect as if the Successor were the Landlord,
and Tenant does hereby (i) agree to attorn to the Successor, including Mortgagee
if it be the Successor, as its landlord, (ii) affirm its obligations under the
Lease, and (iii) agree to make payments of all sums due under the Lease to the
Successor, said attornment, affirmation and agreement to be effective and
self-operative without the execution of any further instruments, upon the
Successor succeeding to the interest to the Landlord under the Lease. Tenant
waives the provisions of any statute or rule of law now or hereafter in effect
that may give or purport to give it any right or election to terminate or
otherwise adversely affect the Lease or the obligations of Tenant thereunder by
reason of any foreclosure or similar proceeding.
<PAGE>
5. This Agreement may not be modified except by an agreement in writing
signed by the parties or their respective successors in interest. This Agreement
shall inure to the benefit of and be binding upon the parties hereto, their
respective heirs, representatives, successors and assigns.
6. Nothing contained in this Agreement shall in any way impair or affect
the lien created by the Mortgage except as specifically set forth herein.
7. The Tenant agrees that this Agreement satisfies any condition or
requirement in the Lease relating to the granting of a non-disturbance agreement
by Mortgagee. Tenant further agrees that in the event there is any inconsistency
between the terms and provisions hereof and the terms and provisions of the
Lease dealing with non-disturbance by Mortgagee, the terms and provisions hereof
shall be controlling.
8. All notices, demands or requests made pursuant to, under, or by virtue
of this Agreement must be in writing and mailed to the party whom the notice,
demand or request is being made by certified or registered mail, return receipt
requested, at its address set forth above. Any party may change the place that
notices and demands are to be sent by written notice delivered in accordance
with this Agreement.
9. This Agreement shall be governed by the laws of the State of New
Jersey. If any term of this Agreement or the application thereof to any person
or circumstances shall to any extent be invalid or unenforceable, the remainder
of this Agreement or the application of such term to any person or circumstances
other than those as to which it is invalid or unenforceable shall not be
affected thereby, and each term of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have hereunto caused this Agreement
to be duly executed as of the day and year first above written.
MORTGAGEE
U.S. Bank National Association, a national banking
association
By:
-------------------------------
Name:
Title:
TENANT
By:
-------------------------------
Name:
Title:
[Acknowledgments]
- --------------------------------------------------------------------------------
SENIOR ASSIGNMENT AGREEMENT
dated as of April 17, 1998
by
TRUMP'S CASTLE FUNDING, INC.,
a New Jersey corporation, as Assignor
to
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Senior Note Indenture, as Assignee
- --------------------------------------------------------------------------------
Record and Return to:
Robert L. Nutt, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110
(617) 951-7000
<PAGE>
SENIOR ASSIGNMENT AGREEMENT
This SENIOR ASSIGNMENT AGREEMENT (the "Senior Assignment") is dated as of
April 17, 1998 from TRUMP'S CASTLE FUNDING, INC., a New Jersey corporation
("Assignor"), to U.S. BANK NATIONAL ASSOCIATION, a national banking association,
as Trustee under the Senior Note Indenture, as defined below ("Assignee").
W I T N E S S E T H:
WHEREAS, Assignor, a wholly-owned subsidiary of Trump's Castle Associates,
L.P. a New Jersey limited partnership (the "Partnership"), functions as the
Partnership's financing vehicle for advancing to the Partnership the proceeds of
various issues of Assignor's debt securities against receipt of the
Partnership's promissory notes, secured by a mortgage upon the Partnership's
assets; and
WHEREAS, Assignor has issued and sold $62,000,000 aggregate principal
amount of its 10 1/4% Senior Secured Notes due 2003 (the "Senior Notes"),
pursuant to the provisions of an Indenture (the "Senior Note Indenture") of even
date herewith entered into among the Assignor, as issuer, the Partnership, as
guarantor, and Assignee, as trustee, and has loaned said proceeds to the
Partnership, its parent, in exchange for the Partnership's note in the principal
amount of $62,000,000 (the "Senior Partnership Note") which is secured by an
Indenture of Mortgage and Security Agreement (the "Senior Note Mortgage") of
even date herewith, between the Partnership, as mortgagor, and the Assignor, as
mortgagee;
WHEREAS, the Partnership and the Assignor have entered into an Assignment
of Leases and Rents and Assignment of Operating Assets of even date herewith
(the "Senior Assignment of Leases"); and
WHEREAS, certain terms defined in the Senior Note Indenture are used
herein with the meanings there provided.
NOW, THEREFORE, THIS SENIOR ASSIGNMENT
FURTHER WITNESSETH:
Assignor, for good and valuable consideration, the receipt of which is
hereby acknowledged, does hereby sell, assign and transfer unto Assignee and
unto its successors and to its assigns forever, for its benefit and for the
benefit of the Holders, and does hereby grant to Assignee a security interest in
and to all of Assignor's estate, right, title and interest in, to and under any
and all of the following described property, rights and interests (collectively,
the "Assigned Properties"):
<PAGE>
GRANTING CLAUSE FIRST
All right, title and interest of Assignor in and to the Senior Partnership
Note, including all renewals, extensions and modifications of the same, and,
without limiting the generality of the foregoing, the present, continuing and
future right to make claim for, collect or cause to be collected, receive or
cause to be received directly from the Partnership thereunder, all payments of
principal, interest and other sums of money payable thereunder.
GRANTING CLAUSE SECOND
All right, title and interest of Assignor in and to the Senior Note
Mortgage, including all extensions, renewals and modifications of the same.
GRANTING CLAUSE THIRD
All right, title and interest of Assignor in and to the Senior Assignment
of Leases, including all extensions, renewals and modifications of the same.
TO HAVE AND TO HOLD all of said properties, rights and interests unto
Assignee and its successors and assigns forever.
THIS SENIOR ASSIGNMENT FURTHER WITNESSETH, that Assignor hereby agrees and
covenants with Assignee as follows:
ARTICLE I
PARTICULAR COVENANTS OF ASSIGNOR
Section 1.01. Performance of Covenants. Assignor represents, warrants and
covenants that it is duly authorized to enter into this Senior Assignment, and
to grant and convey a lien on and security interest in the Assigned Properties
to Assignee in the manner and to the extent herein set forth and that all action
on its part required for the execution and delivery of this Senior Assignment
has been duly and effectively taken.
Section 1.02. Further Action Required.
(a) Assignor covenants that it will, from time to time, execute and
deliver such further instruments and take such further actions as may be
reasonably required to carry out the purposes of this Senior Assignment.
(b) Assignor hereby appoints Assignee as its lawful attorney-in-fact (such
power being coupled with an interest) in the name of Assignor or Assignee or
both to execute any instruments
-2-
<PAGE>
or to take any actions to enforce all rights, powers and remedies of Assignor
under or pursuant to the Assigned Properties.
(c) Nothing contained herein shall limit the rights of Assignee contained
in the Mortgage Notes, the Mortgage Note Indenture, the Senior Notes, the Senior
Note Indenture, the TCHI Notes or the TCHI Note Indenture.
ARTICLE II
OBLIGATIONS OF ASSIGNEE
Section 2.01. Continuing Obligations.
(a) Assignee shall have no obligation, duty or liability with respect to
the Assigned Properties or any of them (other than those specifically assumed in
its capacity as Trustee pursuant to the Senior Note Indenture).
(b) Assignor shall at all times remain liable to observe and perform all
of its covenants and obligations, if any, under the Assigned Properties, and
does hereby agree to indemnify and hold harmless Assignee, its successors and
assigns, from any liability, loss, damage or expense it or they may incur under
the Assigned Properties or by reason of this Senior Assignment.
ARTICLE III
PAYMENTS
Section 3.01. Payments. All Revenues (as hereinafter defined) due and to
become due under or pursuant to the Assigned Properties shall be paid by the
Partnership directly to Assignee at the address set forth in Section 6.02
hereof.
Section 3.02. Acknowledgment. The Partnership hereby joins in the
execution of this Senior Assignment to acknowledge (i) the assignment by
Assignor to Assignee of Assignor's right, title and interest in, to and under
the Assigned Properties, (ii) the Partnership's agreement to make payment of all
Revenues under the Assigned Properties directly to Assignee at the address set
forth in this Senior Assignment, and (iii) the right of Assignee to exercise or
enforce in its own name, in the name of Assignor, or both, all of the rights,
powers and remedies of Assignor in, to and under the Assigned Properties.
Section 3.03. Revenues. As used herein, the term "Revenues" shall mean (a)
all amounts paid or payable by the Partnership under the Senior Partnership
Note, the Senior Note Indenture, or the Senior Note Mortgage, and (b) the net
proceeds realized upon or as a result of the
-3-
<PAGE>
enforcement of any mortgage lien, security interest or assignment of leases
granted or assigned under the Assigned Properties or this Senior Assignment or
upon or as a result of the exercise of any right or remedy under the Assigned
Properties or this Senior Assignment.
Section 3.04. Confirmation. Assignor hereby agrees, and the Partnership
hereby acknowledges, that the Partnership may rely exclusively on Assignee's
directive that Assignee is entitled to take action under this Senior Assignment.
ARTICLE IV
DEFAULT PROVISIONS AND REMEDIES
Section 4.01. Enforcement of Remedies.
(a) Upon the occurrence and continuance of any Event of Default (as such
term is defined in the Senior Note Indenture or the Senior Note Mortgage; each
an "Event of Default"), Assignee may (upon the direction of the Holders or, if
the rights of the Holders would be prejudiced by any delay in taking such
action, without the direction of the Holders), at its option, (i) proceed
directly to protect and enforce its rights and the rights of any Holders under
this Senior Assignment or pursuant to the Assigned Properties, or any one of
them, by such suits, actions or special proceedings in equity or at law, or by
proceedings in the office of any board or officer having jurisdiction, either
for the specific performance of any covenant or agreement contained herein, or
in the Assigned Properties, or any of them, or in aid of execution of any power
granted herein or pursuant to the Assigned Properties, or any one of them, or
for the enforcement of any proper legal or equitable remedy, including, without
limitation, foreclosure of the Senior Note Mortgage and/or the sale of the
collateral or any part thereof secured thereby at such foreclosure sale, subject
to statutory and other legal requirements, as Assignee shall deem most effective
to protect and enforce such rights, and Assignor hereby appoints Assignee as its
lawful attorney-in-fact (such power being coupled with an interest) in the name
of Assignor or Assignee or both to effectuate such foreclosure and/or sale of
such collateral or part thereof; or (ii) instruct, direct and cause Assignor to
effectuate the foregoing on behalf of and for the benefit of Assignee and the
Holders, it being further understood that the Partnership joins in the execution
of this Senior Assignment in order to acknowledge its agreement to promptly and
duly execute and deliver any and all documents and take any and all actions
required by Assignee in order to permit Assignee to foreclose and/or sell such
collateral or part thereof, and obtain the benefits of this Senior Assignment,
as aforesaid.
(b) Upon the occurrence and continuance of any such Event of Default,
Assignee shall (upon the direction of the Holders or, if the rights of the
Holders would be prejudiced by any delay in taking such action, without the
direction of the Holders) be entitled to sue for, enforce payment of and receive
any and all amounts then and at any time remaining due from Assignor or the
Partnership for principal and interest on the Senior Partnership Note, or other
sums due under the Senior Note Mortgage or the Senior Note Indenture, as the
case may be, or otherwise
-4-
<PAGE>
under any of the provisions of the Assigned Properties, or any of them, in any
of such events with interest on overdue payments of such principal, as set forth
in the Senior Partnership Note, from the date of such Event of Default to the
date of such payment, together with any and all fees, costs and expenses of
collection (including reasonable attorneys' fees and court costs), subject to
statutory and other legal requirements.
(c) Regardless of the occurrence of an Event of Default, Assignee may
institute and maintain or cause in the name of Assignor or Assignee or both to
be instituted and maintained such suits and proceedings as Assignee may be
advised by its counsel shall be necessary and appropriate to prevent any
impairment of the Assigned Properties, or any of them, and to protect its
interests in the Assigned Properties, and in the rents, issues, rights, revenues
and other income arising therefrom, including power to institute and maintain
proceedings to restrain the enforcement or compliance with any governmental
enactment, rule or order that may be unconstitutional or otherwise invalid, if
the enforcement of or compliance with such enactment, rule or order would impair
the security hereunder or would be materially prejudicial to the interest of the
Assignee.
(d) Nothing contained in this Article IV is intended to grant Assignee any
greater remedies and rights than those allowed to Assignor in the respective
Assigned Properties. In the event or any conflict between the remedies and
rights contained in any of the Assigned Properties and the remedies and rights
contained in this Article IV, the remedies and rights set forth in the
applicable Assigned Property shall govern.
ARTICLE V
DISCHARGE OF SENIOR ASSIGNMENT
Section 5.01. Discharge of Senior Assignment. If Assignor shall pay or
cause to be paid, or there shall otherwise be paid, to Assignee and/or the
Holders, all amounts required to be paid by Assignor pursuant to the Senior Note
Indenture and the Senior Notes, and the conditions precedent for the Senior Note
Indenture to cease, determine and become null and void (except for any surviving
rights of transfer or exchange of the Senior Notes and any right to receive
payments of principal and interest as provided in Article Thirteen or Section
10.3 of the Senior Note Indenture) in accordance with Article Thirteen of the
Senior Note Indenture, Assignee shall promptly cancel and discharge of record
this Senior Assignment and any financing statements filed in connection herewith
and execute and deliver to Assignor and to the Partnership all such instruments
as may be appropriate to evidence such discharge and satisfaction of any lien or
liens, and Assignee shall pay over or deliver to Assignor all other moneys and
securities held by it pursuant to this Senior Assignment, which are not required
for the payment of (a) principal and redemption price, if applicable, of and
interest on, the Senior Notes and (b) and all other amounts required to be paid
by Assignor pursuant to the Senior Note Indenture and the Senior Notes.
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<PAGE>
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.01. Binding Successors and Assigns. All of the covenants,
stipulations, obligations and agreements contained in this Senior Assignment
shall be binding upon and inure to the benefit of Assignor, Assignee and the
Partnership and their respective successors and assigns.
Section 6.02. Notices.
Any request, notice, demand, authorization, direction, request or other
instrument authorized or required by this Senior Assignment to be given to or
filed with Assignor, Assignee, or the Partnership (collectively "Notices") shall
be deemed given when either (i) delivered by hand (including by overnight
courier) or (ii) two days after sending by registered or certified mail, postage
prepaid, addressed as follows:
(i) To Assignee:
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55010
Attention: Corporate Trust Administration
(ii) To Assignor:
Trump's Castle Funding, Inc.
Trump Marina Hotel Casino
Brigantine Boulevard at Huron Avenue
Atlantic City, New Jersey 08401
Attention: Chief Executive Officer
(iii) To the Partnership:
Trump's Castle Associates, L.P.
Trump Marina Hotel Casino
Brigantine Boulevard at Huron Avenue
Atlantic City, New Jersey 08401
Attention: Chief Executive Officer
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<PAGE>
and and after May 26, 1998:
Willkie Farr & Gallagher Willkie Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, NY 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
(b) By Notice to the Partnership, Assignor and or Assignee, given as
provided above, any party may designate additional or substitute addresses for
Notices, which shall, notwithstanding Subsection (a) above, be deemed given when
received.
Section 6.04. Partial Invalidity. In case any one or more of the
provisions of this Senior Assignment shall for any reason be held to be illegal
or invalid, such illegality or invalidity shall not affect any other provision
of this Senior Assignment, but this Senior Assignment shall be construed and
enforced at the time as if such illegal or invalid provisions had not been
contained herein or therein, nor shall such illegality or invalidity or any
application thereof affect any legal and valid application herein or thereof
from time to time.
Section 6.05. Applicable Law. This Senior Assignment shall be governed by
and construed under the internal laws of the State of New Jersey, without giving
effect to the principles of conflicts of law.
Section 6.06. No Amendments. For so long as the Senior Notes shall remain
outstanding, this Senior Assignment may not be modified, amended or terminated
except in accordance with the provisions of the Senior Note Indenture or the
Assigned Properties.
Section 6.07. Casino Control Act. Each of the provisions of this Senior
Assignment is subject to and shall be enforced in compliance with the provisions
of the New Jersey Casino Control Act.
Section 6.08. Limitation on Liability. Notwithstanding anything herein or
any other agreement, document, certificate, instrument, statement or omission
referred to below to the contrary, the Partnership and the Assignor are liable
hereunder only to the extent of the assets of the Partnership and the interest
of the Assignor in the Assigned Properties which are secured by the
Partnership's assets and no other person or entity, including, but not limited
to, any partner, officer, representative, committee or committee member of the
Partnership or any partner therein or of any Affiliate (as defined in the
Indenture) of the Partnership or any incorporator, officer, director or
shareholder of the Assignor, of any corporate partner of the Partnership, or of
any corporate Affiliate of the Partnership, or any Affiliate or controlling
person or entity of any of the foregoing, or any agent, employee or lender of
any of the foregoing or any successor, personal representative, heir or assign
of any of the foregoing, in each case past, present or as they may exist in the
future, shall be liable in any respect (including without limitation for the
breach of
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<PAGE>
any representation, warranty, covenant, agreement, condition or indemnification
or contribution undertaking contained herein or therein) under, in connection
with, arising out of or relating to this Senior Assignment, or any other
agreement, document, certificate, instrument or statement (oral or written)
related to, executed or to be executed, delivered or to be delivered, or made or
to be made, or any omission made or to be made, in connection with any of the
foregoing or any of the transactions contemplated in any such agreement,
document, certificate, instrument or statement. Any agreement, document,
certificate, statement or other instrument to be executed simultaneously with,
in connection with, arising out of or relating to this Senior Assignment or any
other agreement, document, certificate, statement or instrument referred to
above, or any agreement, document, certificate, statement or instrument
contemplated hereby shall contain language mutatis mutandis to this paragraph
and, if such language is omitted, shall be deemed to contain such language.
6.09. Indemnification. Assignor agrees to indemnify Assignee for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of this Senior Assignment, including the costs and
expenses of defending itself against any claim, or with the exercise or
performance of any of its powers or duties hereunder.
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<PAGE>
IN WITNESS WHEREOF, Assignor, Assignee, and the Partnership have executed
this Senior Assignment as of the date first above written.
TRUMP'S CASTLE FUNDING, INC., a New Jersey
corporation
Witness: /s/ Beth E. Anisman By: /s/ Nicholas L. Ribis
------------------------- -----------------------------------------
Beth E. Anisman Name: Nicholas L. Ribis
Title: President and Chief Executive
Officer
TRUMP'S CASTLE ASSOCIATES, L.P.
a New Jersey limited partnership
By: Trump's Castle Hotel & Casino, Inc.,
its general partner
Witness: /s/ Beth E. Anisman By: /s/ Nicholas L. Ribis
------------------------- -----------------------------------------
Beth E. Anisman Name: Nicholas L. Ribis
Title: President and Chief Executive
Officer
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Senior Note Indenture
Witness: /s/ Beth E. Anisman By: /s/ Richard H. Prokosch
------------------------- -----------------------------------------
Beth E. Anisman Name: Richard H. Prokosh
Title: Assistant Vice President
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<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the President and Chief Executive Officer of TRUMP'S CASTLE
FUNDING, INC., who I am satisfied is the person who executed the within
instrument and he acknowledged that he signed and delivered the same as such
officer on behalf of such entity and that the within instrument is the voluntary
act and deed of said corporation made by virtue of the authority of its board of
directors.
/s/ Marcus Chioffi
- -----------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the President and Chief Executive Officer of TRUMP'S CASTLE
HOTEL & CASINO, INC., the general partner of TRUMP'S CASTLE ASSOCIATES, L.P.,
who I am satisfied is the person who executed the within instrument and he
acknowledged that he signed and delivered the same as such officer on behalf of
such entity and that the within instrument is the voluntary act and deed of said
corporation made by virtue of the authority of its board of directors.
/s/ Marcus Chioffi
- -----------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- -----------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-12-
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
(Senior Partnership Upstream Note Mortgage)
TRUMP'S CASTLE ASSOCIATES, L.P.
Mortgagor/Debtor
and
TRUMP'S CASTLE HOTEL & CASINO, INC.,
Mortgagee/Secured Party
Dated as of April 17, 1998
Record and Return to:
Robert L. Nutt, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110-2624
<PAGE>
TABLE OF CONTENTS
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION.................................................8
Section 1.1. Definitions..................................8
Section 1.2 Notices......................................18
Section 1.3. Form and Contents of Documents Delivered to
Mortgagee...................................20
Section 1.4. Compliance Certificates and Opinions.........20
Section 1.5. Effect of Headings and Table of Contents.....21
Section 1.6. Successors and Assigns; Amendments...........21
Section 1.7. Separability Clause..........................22
Section 1.8. Benefits of Mortgage.........................22
Section 1.9. Governing Law................................22
Section 1.10. Limitation on Liability......................22
Section 1.11. Provisions Required by TCHI Note Indenture...23
Section 1.12. References to Mortgagee and/or to Trustee;
Rights of Trustee...........................23
Section 1.13. Mortgage Subject to Casino Control Act.......25
Section 1.14. Discharge of Lien............................25
Section 1.15. General Application..........................25
Section 1.16 Senior Partnership Upstream Note Mortgage
Deemed to be Security Agreement.............25
Section 1.17. No Duplication of Notices or Payments........26
ARTICLE TWO RELEASE; SUBORDINATION...................................26
Section 2.1. Possession by Mortgagor......................26
Section 2.2. Obsolete Property............................26
Section 2.3. F,F&E Financing Agreements...................27
ARTICLE THREE REMEDIES...............................................28
Section 3.1. Events of Default............................28
Section 3.2. Acceleration of Maturity; Recision and
Annulment...................................30
Section 3.3. Application of Moneys Received by Mortgagee..30
Section 3.4. Restoration of Rights and Remedies...........30
Section 3.5. Rights and Remedies Cumulative...............30
Section 3.6. Delay or Omission Not Waiver.................30
Section 3.7. Undertaking for Costs........................30
Section 3.8. Waiver of Appraisement and Other Laws........31
Section 3.9 Entry........................................31
Section 3.10. Power of Sale; Suits for Enforcement.........31
Section 3.11. Incidents of Sale............................32
Section 3.12. Receiver.....................................33
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<PAGE>
Section 3.13. Suits to Protect the Trust Estate............33
Section 3.14. Management of the Premises...................34
ARTICLE FOUR CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER
OR LEASE............................................................34
Section 4.1. Consolidation, Merger, Conveyance or
Transfer only on Certain Terms..............34
Section 4.2. Successor Entity Substituted.................34
ARTICLE FIVE COVENANTS AND REPRESENTATIONS OF MORTGAGOR..............34
Section 5.1. Payment of Principal, Premium and Interest...34
Section 5.2. F,F&E Financing Agreements...................35
Section 5.3. Limitations on Liens and Transfers...........35
Section 5.4. Environmental................................36
Section 5.5. Warranty of Leasehold Estate and Title.......39
Section 5.6. After-Acquired Property; Further
Assurances; Recording.......................40
Section 5.7. Payment of Taxes and Certain Claims;
Maintenance of Properties; Compliance
with Legal Requirements and Insurance
Requirements................................42
Section 5.8. Permitted Contests...........................43
Section 5.9. Mechanics' and Other Liens...................44
Section 5.10. To Insure....................................44
Section 5.11. Limitations on Building Demolition,
Alterations, Improvements and New
Construction................................50
Section 5.12 Leases.......................................52
Section 5.13. Compliance Certificates......................54
Section 5.14. To Keep Books; Inspection by Mortgagee.......54
Section 5.15. Advances by Mortgagee........................55
Section 5.16. Waiver of Stay, Extension or Usury Laws......55
Section 5.17. Eminent Domain...............................55
Section 5.18. Facility Leases..............................57
Section 5.19. Indemnification..............................61
Section 5.20 TCHI Mortgages...............................63
SCHEDULE 1 OWNED LAND................................................1-1
SCHEDULE 2 LEASED LAND...............................................2-1
SCHEDULE 3 EXISTING ENCUMBRANCES.....................................2-1
SCHEDULE 4 FORM OF NON-DISTURBANCE AND
ATTORNMENT AGREEMENT.................................................2-1
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<PAGE>
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT ("Senior Partnership Upstream
Note Mortgage" or "Mortgage"), dated as of April 17, 1998 between TRUMP'S CASTLE
ASSOCIATES, L.P. a New Jersey limited partnership having an office at Brigantine
Boulevard and Huron Avenue, Atlantic City, New Jersey 08401 ("Mortgagor"), and
TRUMP'S CASTLE HOTEL & CASINO, INC., a New Jersey corporation having an office
at Brigantine Boulevard and Huron Avenue, Atlantic City, New Jersey 08401
("Mortgagee").
Witnesseth:
In consideration of $10.00 in hand paid by Mortgagee to Mortgagor and for
other good and valuable consideration, the receipt and sufficiency whereof is
hereby acknowledged, and in order to secure (i) the payment of the principal
amount (and premium, if any) of the Senior Partnership Upstream Note, in lawful
money of the United States, to be paid in accordance with the provisions thereof
(and of all modifications, extensions, and renewals thereof), all of which
provisions are hereby made an integral part hereof as though set forth at length
herein; (ii) payment of interest (including, without limitation, interest on all
overdue principal and premium, if any) becoming due under the provisions of the
Senior Partnership Upstream Note; (iii) payment by Mortgagor to Mortgagee of all
sums expended or advanced by Mortgagee pursuant to any term or provision of this
Senior Partnership Upstream Note Mortgage; (iv) performance of each covenant,
term, condition and agreement of Mortgagor herein or in the Senior Partnership
Upstream Note contained; (v) all costs and expenses, including, without
limitation, reasonable counsel fees and expenses as provided in Section 3.7 of
this Mortgage, which may arise in respect of the Senior Partnership Upstream
Note and this Senior Partnership Upstream Note Mortgage or of the obligations
secured hereby; and (vi) performance and observance of all of the provisions
herein contained, Mortgagor has executed and delivered this Senior Partnership
Upstream Note Mortgage and has bargained, sold, alienated, mortgaged, pledged,
released, conveyed and confirmed unto Mortgagee and its successors hereunder and
assigns forever, and does hereby grant to Mortgagee and its successors a
security interest in and to, all of Mortgagor's right, title and interest in, to
and under all of the following described property and the proceeds thereof:
GRANTING CLAUSES
Granting Clause First
All of the property, rights, title, interest, privileges and franchises
particularly described in annexed Schedule 1 (the "Owned Land"), which Schedule
is hereby made a part
<PAGE>
of, and deemed to be described in, this Granting Clause as fully as if set forth
in this Granting Clause at length.
Granting Clause Second
[Intentionally omitted]
Granting Clause Third
All of the property, rights, title, interest, privileges and franchises of
Mortgagor as lessee under all Facility Leases (including, to the extent
permissible under the Marina Lease, the Marina Lease), together with (i) all
credits, deposits, privileges and rights of Mortgagor as lessee under the
Facility Leases, now or at any time existing, (ii) the leaseholds and the
leasehold estates created by the Facility Leases and (iii) all of the estates,
rights, titles, claims or demands whatsoever of Mortgagor, either in law or in
equity, in possession or in expectancy, of, in and to the Facility Leases and
the Leased Facilities (including, but not limited to, the Leased Land as
particularly described in annexed Schedule 2), together with (x) any and all
other, further or additional title, estates, interests or rights which may at
any time be acquired by Mortgagor in or to the Leased Facilities or any part
thereof, and Mortgagor expressly agrees that if Mortgagor shall, at any time
prior to payment in full of all indebtedness secured hereby, acquire fee simple
title or any other greater estate to the Leased Facilities, the lien of this
Mortgage, subject to Permitted Encumbrances, shall attach, extend to, cover and
be a lien upon such fee simple title or other greater estate and thereupon the
lien of this Mortgage, subject to Permitted Encumbrances, shall be prior to the
lien of any mortgage or deed of trust placed on such acquired title, estate,
interest or right subsequent to the date of this Mortgage and (y) any right to
possession or statutory term of years derived from, or incident to, the Facility
Leases pursuant to Section 365(h) of the Code or any Comparable Provision.
Granting Clause Fourth
All of the rents, issues, profits, revenues, accounts, accounts receivable
and other income and proceeds (including, without limitation, all rents, fees,
charges, accounts, issues, profits, revenues and payments for or from (a) the
use or occupancy of the rooms and other public facilities in the Hotel and (b)
the operation of the Casino) of the property subjected or required to be
subjected to the lien of this Mortgage, including, without limitation, the
property described in Granting Clauses First, Third and Seventh (said property
described in Granting Clauses First, Third and Seventh and similar other
property subjected or required to be subjected to the lien of this Mortgage,
together with all such rents, issues, profits, revenues, accounts, accounts
receivable and other income and proceeds therefrom is hereinafter
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<PAGE>
collectively referred to as the "Premises") and all of the estate, right, title
and interest of every nature whatsoever of Mortgagor in and to the same and
every part thereof.
Granting Clause Fifth
All of the rights of Mortgagor as lessor under the Leases in effect on the
date of execution of this Mortgage or hereafter entered into by Mortgagor,
including modifications, extensions and renewals of all of the same, and the
immediate and continuing right as security after the occurrence, and during the
continuance, of an Event of Default, to (a) make claim for, collect, receive and
receipt for (and to apply the same as provided herein) any and all rents, fees,
charges, income, revenues, issues, profits, security and other sums of money
payable or receivable thereunder or pursuant thereto, and all proceeds thereof,
whether payable as rent, insurance proceeds, condemnation awards, security or
otherwise and whether payable prior to or subsequent to the Stated Maturity of
the Senior Partnership Upstream Note, (b) receive and give notices and consents
thereunder, (c) bring actions and proceedings thereunder or for the enforcement
thereof, (d) make waivers and agreements thereunder or with respect thereto, (e)
take such action upon the happening of a default under any Lease, including the
commencement, conduct and consummation of any proceedings at law or in equity as
shall be permitted by any provision of any Lease, and (f) do any and all things
which Mortgagor or any lessor is or may become entitled to do under the Leases;
provided that, except as may be set forth to the contrary herein, the assignment
made by this Granting Clause Fifth shall not impair or diminish any right,
privilege or obligation of Mortgagor under the Leases nor shall any such
obligation be imposed upon Mortgagee.
Granting Clause Sixth
Without limiting the generality of the provisions of Granting Clause
Fourth, all of Mortgagor's rights, title, interest, privileges and franchises in
and to the following, now owned or hereafter acquired by Mortgagor, to the
extent of Mortgagor's interest therein and thereto and to the extent assignable
(collectively, "Operating Assets"):
(a) bookings for the use of guest rooms, banquet facilities, meeting rooms
at the Casino Hotel or at any other improvements now or hereafter located on any
of the Land;
(b) all contracts respecting utility services for, and the maintenance,
operations, or equipping of, the Premises, including guaranties and warranties
relating thereto;
(c) the Permits;
(d) all contract rights, leases (whether with respect to real property,
personal property or both real and personal property), concessions, trademarks,
trade names, service
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<PAGE>
marks, logos, copyrights, warranties and other items of intangible personal
property, and any and all good will associated with the same, relating to the
ownership or operation of the Casino Hotel or of any other improvements now or
hereafter located on any of the Land, including, without limitation, (1)
employment contracts with officers and other employees of Mortgagor, (2)
telephone and other communication numbers, (3) all software licensing agreements
as are required to operate computer software systems at the Casino Hotel or at
any other improvements now or hereafter located on any of the Land and books and
records relating to the software programs and (4) Mortgagor's interest under
leases of Tangible Personal Property;
(e) all contracts, purchase orders, requisitions and agreements entered
into by or on behalf of Mortgagor or which have been assigned to Mortgagor, for
the design, construction, and furnishing of the Casino Hotel or of any other
improvements now or hereafter located on any of the Land, including, without
limitation, architect's agreements, engineering agreements, construction
contracts, consulting agreements and agreements or purchase orders for all items
of Tangible Personal Property and payment and performance bonds in favor of
Mortgagor in connection with the Trust Estate (and all warranties and guarantees
thereunder and warranties and guarantees of any subcontractor and bond issued in
connection with the work to be performed by any subcontractor);
(f) the following personal property (the "Tangible Personal Property") now
or hereafter acquired by Mortgagor (directly or by way of lease) which is
located on, or to be located on, or which is in use or held in reserve storage
for future use in connection with the gaming or other operations of, the Casino
Hotel or of any other improvements now or hereafter located on any of the Land,
which is on hand or on order whether stored on-site or off-site:
(i) all furniture, furnishings, equipment, machinery, lighting,
apparatus (both interior and exterior), appliances, fixtures and fittings
and other articles of tangible personal property;
(ii) all slot machines, electronic gaming devices, crap tables,
blackjack tables, poker tables, roulette tables, baccarat tables, big six
wheels and other gaming tables, and all furnishings and equipment to be
used in connection with the operation thereof;
(iii) all cards, dice, gaming chips and plaques, tokens, chip racks,
dealing shoes, dice cups, dice sticks, layouts, paddles, roulette balls
and other consumable supplies and items;
(iv) all china, glassware, linens, kitchen utensils, silverware and
uniforms;
(v) all consumables and operating supplies of every kind and nature,
including, without limitation, accounting supplies, guest supplies, forms,
printing, stationery, food
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<PAGE>
and beverage stock, bar supplies, laundry supplies and brochures to
existing purchase orders;
(vi) all upholstery material, carpets and rugs, beds, bureaus,
chiffonniers, chairs, chests, desks, bookcases, tables, curtains,
hangings, pictures, divans, couches, ornaments, bars, bar fixtures, safes,
stoves, ranges, refrigerators, radios, televisions, clocks; electrical
equipment, lamps, mirrors, heating and lighting fixtures and equipment,
ice machines, air conditioning machines, fire prevention and extinguishing
apparatus, laundry machines, and all similar and related articles used in
bedrooms, sitting rooms, bathrooms, boudoirs, halls, closets, kitchens,
dining rooms, offices, lobbies, basements and cellars in the Casino Hotel
and in any other improvements now or hereafter located on any of the Land;
(vii) all sets and scenery, costumes, props and other items of
tangible personal property on hand or on order for use in the production
of shows in any showroom, convention space, exhibition hall, or sports and
entertainment arena of the Casino Hotel or in any other improvements now
or hereafter located on any of the Land; and
(viii) all cars, limousines, vans, buses, trucks and other vehicles
owned or leased by Mortgagor for use in connection with the operation of
the Premises, together with all equipment, parts and supplies used to
service, repair, maintain and equip the foregoing;
(g) all drawings, designs, plans and specifications prepared by
architects, engineers, interior designers, landscape designers and any other
professionals or consultants for the design, development, construction and/or
improvement of the Casino Hotel, or for any other development of the Premises,
as amended from time to time;
(h) any administrative and judicial proceedings initiated by Mortgagor, or
in which Mortgagor has intervened, concerning the Premises, and agreements, if
any, which are the subject matter of such proceedings;
(i) any customer lists utilized by Mortgagor including lists of transient
guests and restaurant and bar patrons and "high roller" lists; and
(j) all of the good will in connection with the assets listed in this
Granting Clause Sixth and in connection with the operation of the Premises.
Except as may be set forth to the contrary herein, the assignment made by
this Granting Clause Sixth shall not impair or diminish any right, privilege or
obligation of Mortgagor with respect to the Operating Assets, nor shall any such
obligation be imposed on Mortgagee.
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<PAGE>
Granting Clause Seventh
(a) All of Mortgagor's rights, title, interest, privileges and franchises,
if any, in and to all buildings, structures (surface and subsurface), and other
improvements of every kind and description, including, without limitation, all
pedestrian bridges, entrance-ways, parking lots, plazas, curb-cuts, walkways,
driveways and landscaping and such fixtures as constitute real property, now or
hereafter erected or placed on the Land or on any other land or any interest
therein hereafter acquired by Mortgagor and all of Mortgagor's rights, title,
interest, privileges and franchises in and to all fixtures and articles of
personal property now or hereafter attached to or contained in and used in
connection with such buildings and improvements, including, without limitation,
all apparatus, furniture, furnishings, lighting equipment, electronic
billboards, machinery, motors, elevators, fittings, radiators, cooking ranges,
ice boxes, ice machines, printing presses, mirrors, bars, mechanical
refrigerators, furnaces, coal and oil burning apparatus, wall cabinets,
machinery, generators, partitions, steam and hot water boilers, lighting and
power plants, pipes, plumbing, radiators, sinks, bath tubs, water closets, gas
and electrical fixtures, awnings, shades, screens, blinds, dishwashers,
freezers, vacuum cleaning systems, office equipment and other furnishings, and
all plumbing, heating, lighting, cooking, laundry, ventilating, incinerating,
air-conditioning and sprinkler equipment or other fire prevention or
extinguishing apparatus and material, and fixtures and appurtenances thereto;
and all renewals or replacements thereof or articles in substitution therefor,
whether or not the same are or shall be attached to the Land, any other land or
any interest therein hereafter acquired by Mortgagor or to any such buildings
and improvements thereon, in any manner.
(b) All of Mortgagor's rights, title, interest, privileges and franchises
in and to all other property, real, personal or mixed (other than Excepted
Property), of every kind and description and wheresoever situate, now owned or
which may be hereafter acquired by Mortgagor, it being the intention hereof that
all property, interests, rights, privileges and franchises now owned by
Mortgagor or acquired by Mortgagor after the date hereof (other than Excepted
Property) shall be as fully embraced within and subjected to the lien hereof as
if such property were specifically described herein.
* * *
TOGETHER with all of Mortgagor's right, title and interest in and to any
and all mineral and water rights and any title or reversion, in and to the beds
of the ways, streets, avenues and alleys adjoining the Premises to the center
line thereof and in and to all strips, gaps and gores adjoining the Premises on
all sides thereof; and
TOGETHER with any and all of Mortgagor's right, title and interest in and
to the tenements, hereditaments, easements, appurtenances, passages, waters,
water courses, riparian rights, other rights, liberties and privileges thereof
or in any way now or hereafter appertaining to the Premises, including, without
limitation, any other claim at law or in equity as well as
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any after-acquired title, franchise or license and the reversion and reversions
and remainder and remainders thereof; and
TOGETHER with any and all awards and other compensation heretofore or
hereafter to be made to the present and all subsequent owners of the Trust
Estate for any taking by eminent domain, either permanent or temporary, of all
or any part of the Trust Estate or any easement or appurtenances thereof,
including severance and consequential damage and change in grade of streets, all
in accordance with and subject to the provisions of the Superior Instrument
Requirements and Section 5.17; and
TOGETHER with any and all proceeds of any unearned premiums on any
insurance policies described in Section 5.10, and the right to receive and apply
the proceeds of any insurance, judgments, or settlements made in lieu thereof,
for damage to the Trust Estate or otherwise, all in accordance with and subject
to the provisions of Section 5.10 and the Superior Instrument Requirements; and
TOGETHER with all proceeds of every kind and nature, and all products of
every kind and nature, of any of the foregoing property, rights, title,
interests, privileges, franchises and other assets described in Granting Clauses
First through Seventh or in any of the other clauses thereafter.
The foregoing shall include, whether or not specifically identified in one
or more instances, all such property, rights, title, interests, privileges,
franchises and other assets now owned and/or hereafter existing.
EXCLUDING, with respect to all of the hereinabove granted property,
rights, title, interest, privileges and franchises described in Granting Clauses
First through Seventh or in the six immediately preceding paragraphs, all
Excepted Property now or hereafter existing.
TO HAVE AND TO HOLD all of said Premises, Leases, Facility Leases,
Operating Assets, properties, options, credits, deposits, rights, privileges and
franchises of every kind and description, real, personal or mixed, hereby and
hereafter granted, bargained, sold, alienated, assigned, transferred,
hypothecated, pledged, released, conveyed, mortgaged, or confirmed as aforesaid,
or intended, agreed or covenanted so to be, together with all the appurtenances
thereto appertaining (said Premises, Leases, Facility Leases, Operating Assets,
properties, options, credits, deposits, rights, privileges and franchises, other
than Excepted Property now or hereafter existing, being herein collectively
called the "Trust Estate") unto Mortgagee and its successors and assigns
forever.
PROVIDED, HOWEVER, that the lien of this Senior Partnership Upstream Note
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Mortgage upon the Trust Estate shall rank pari passu with the lien of the Senior
Note Mortgage, the lien of the Senior Guarantee Mortgage, the lien of the TCHI
Note Guarantee Mortgage and the lien of any other Working Capital Facility
Mortgage.
BUT IN TRUST, NEVERTHELESS, for the ratable benefit and security of the
Holders.
UPON CONDITION that, until the happening of an Event of Default, Mortgagor
shall be permitted to possess and use the Trust Estate, and to receive and use
the rents, issues, profits, revenues and other income of the Trust Estate.
AND IT IS HEREBY COVENANTED AND DECLARED that the Trust Estate is to be
held and applied by Mortgagee, subject to the further covenants, conditions and
trusts hereinafter set forth, and Mortgagor does hereby covenant and agree to
and with Mortgagee, for the ratable benefit of the Holders, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
Section 1.1. Definitions.
For all purposes of this Senior Partnership Upstream Note Mortgage, except
as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article One have the meanings assigned to
them in this Article One and include the plural as well as the singular;
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them, and all computations herein provided for shall be made, in
accordance with generally accepted accounting principles in effect on the date
hereof consistently applied; and
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Mortgage as a whole and not to any particular
Article, Section or other subdivision.
"Affiliate" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Alterations" has the meaning set forth in Section 5.11.
"Appraised Value" means the fair market value of the Casino Hotel, and of
all other
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property now or hereafter owned or leased by Mortgagor and subject to the lien
of this Mortgage, as determined by an Independent Appraiser on the basis of an
appraisal in conformity with the criteria set forth at 12 C.F.R. ss. 564.4 or
such similar published policy or regulation as from time to time governs real
estate related transactions by institutions regulated by the Office of Thrift
Supervision; provided, that the value of the Casino Hotel and such other
property shall not include the value of (i) any furniture, fixtures and
equipment therein to the extent of the Outstanding Amount of any Indebtedness
secured by any F,F&E Financing Agreements with respect thereto and (ii) any
Excepted Property.
"Appraiser" means a "state certified appraiser" as defined in 12 C.F.R.
ss. 564.2(i) who is (i) of recognized standing among appraisers of properties
similar to the Casino Hotel and (ii) experienced in the appraisals of properties
of a similar size and scope to that of the Casino Hotel, selected by Mortgagor.
"Architect" means an Independent Person selected by Mortgagor and licensed
as an architect in the State of New Jersey.
"Casino" means that portion of the Casino Hotel used for gaming and
related activities.
"Casino Hotel" means the casino and hotel complex currently known as the
"Trump Marina Hotel Casino in Atlantic City, New Jersey, and ancillary
structures and facilities located on the Premises (other than the property
covered by the Marina Lease) and all furniture, fixtures and equipment at any
time contained therein in each case owned by or leased to Mortgagor.
"Casualty" means any act or occurrence of any kind or nature which results
in damage, loss or destruction to any buildings or improvements on the Premises
and/or Tangible Personal Property.
"Certificate of Appraised Value" means the certificate of an Independent
Appraiser stating the Appraised Value.
"Code" means the Federal Bankruptcy Code, Title 11 of the United States
Code, as amended.
"Company" means Trump's Castle Funding, Inc., a corporation incorporated
under the laws of the State of New Jersey, or any other obligor on the Senior
Notes (other than Mortgagor).
"Comparable Provision" has the meaning set forth in Section 5.18.
"Default" means any event which is, or after notice or lapse of time or
both would be, an Event of Default. Without limiting the generality of the
previous provisions of this
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definition, the term "Default" shall include the occurrence of an event as to
which a notice of default has been given to Mortgagor under any Facility Lease
by a Lessor which has not yet been cured.
"Event of Default" has the meaning set forth in Section 3.1.
"Excepted Property" means:
(1) the personal property owned by lessees under Leases and the personal
property of any Hotel guests;
(2) trade names, intellectual property rights and other rights and
interests in and to the use of the terms "Trump's Castle," "Trump," "Trump's
Castle Casino Resort", "Trump Marina", "Trump Marina Hotel Casino", "Donald J.
Trump," "Donald Trump" or related variations thereof;
(3) any property deemed to be Excepted Property pursuant to the provisions
of Section 2.3;
(4) counterchecks, cash and any other property to the extent that the
granting of a security interest therein is prohibited by the New Jersey Casino
Control Act and the regulations promulgated thereunder;
(5) any property acquired pursuant to secured purchase-money indebtedness
permitted under clause "h" of the definition of "Permitted Indebtedness" in the
TCHI Note Indenture; and
(6) all equity interests in any Person now owned or hereafter acquired by
Mortgagor (including without limitation, the capital stock of the Company) which
are required to be pledged under the indenture (as the same may be amended,
modified, restated or supplemented) relating to the 15 1/2% senior secured notes
due 2005 of Trump Hotels & Casino Resorts Holdings, L.P. and Trump Hotels &
Casino Resorts Funding, Inc.
"Existing Encumbrances" means the matters set forth in Schedule 3 hereto.
"Facility Leases" means, collectively:
(1) the Marina Lease;
(2) any leases other than Capital Lease Obligations and the Marina Lease
where Mortgagor is tenant or sub-tenant; provided, however, that the aggregate
fixed rental payments paid or accrued for any period of four consecutive fiscal
quarters commencing after the date hereof under all such leases (including
payments required to be made by the lessee in respect
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of taxes and insurance, whether or not denominated as rent), shall not exceed
for such period (a) $2,000,000 or (b) $7,500,000 following the time at which the
Partnership shall have achieved EBITDA for any period of four consecutive
quarters in an amount not less than $45.0 million; provided, further, that the
Mortgagor may designate certain such leases which are not material to the
operations of the Casino Hotel and which have aggregate fixed rental payments
(including payments required to be made by the lessee in respect of taxes and
insurance, whether or not denominated as rent) not exceeding an aggregate of
$300,000 per year to be excluded from the leases covered by this clause (2); and
(3) any and all modifications, extensions and renewals of the leases
described in clauses (1) and (2) above, to the extent the same are permitted
under Section 5.18.
"F,F&E Financing Agreement" has the meaning set forth in Section 1.1 of
the TCHI Note Indenture.
"Full Insurable Value" means the actual replacement cost (excluding the
costs of foundation, footing, excavation, paving, landscaping and other similar,
noninsurable improvements) of the insurable properties in question.
"Holder" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Hotel" means that portion of the Casino Hotel not included within the
Casino.
"Impositions" has the meaning set forth in Section 5.7.
"Indebtedness" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Independent" when used with respect to any specified Person means such a
Person who (i) is in fact independent, (ii) does not have any direct financial
interest or any material indirect financial interest in Mortgagor or in any
other obligor upon the Senior Partnership Upstream Note or in any Affiliate of
Mortgagor or of such other obligor and (iii) is not connected with Mortgagor or
such other obligor or any Affiliate of Mortgagor or such other obligor as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions. Whenever it is herein provided that any
Independent Person's opinion or certificate shall be furnished to Mortgagee,
such opinion or certificate shall state that the signer has read this definition
and that the signer is Independent within the meaning thereof. A Person who is
performing or who has performed services as an independent contractor to any
specified Person shall not be considered not Independent merely by reason of the
fact that such Person is performing or has performed such services.
"Insurance Amount" has the meaning set forth in Section 5.10(a)(i).
"Insurance Requirements" means all terms of any insurance policy covering
or
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applicable to the Trust Estate or any part thereof, all requirements of the
issuer of any such policy, and all orders, rules, regulations and other
requirements of the National Board of Fire Underwriters (or any other body
exercising similar functions) applicable to or affecting the Trust Estate or any
part thereof or any use or condition of the Trust Estate or any part thereof.
"Insurance Trustee" means the Trustee or, if the Trustee so elects, any
bank, trust company or insurance company with a net worth in excess of
$100,000,000, designated by the Trustee.
"Insurer" means (i) an insurance company or companies selected by
Mortgagor authorized to issue insurance in the State of New Jersey with an A.M.
Best rating level of A minus or better and an A.M. Best financial size category
of VIII or better or (ii) Lloyds of London so long as its financial capacity is
not such that prudent owners of first-class casino and hotel complexes in
Atlantic City, New Jersey would be unwilling to accept Lloyds of London;
provided, that with respect to the insurance required to be maintained pursuant
to Section 5.10(a)(i), up to 1.0% of the total amount of such insurance in
excess of the first $10,000,000 thereof may be maintained with an insurance
company or companies not meeting the foregoing A.M. Best rating level and/or
A.M. Best financial size categories; and provided, further, that Mortgagor shall
in all events use commercially reasonable efforts to obtain insurance issued by
insurance companies having an A.M. Best rating level of better than A minus.
"Land" means, collectively, the Owned Land and the Leased Land.
"Lease" means each lease or sublease (made by Mortgagor, as lessor or
sublessor, as the case may be) of any space in any building or buildings, an
interest in which building or buildings constitutes a part of the Trust Estate,
including every agreement relating thereto or entered into in connection
therewith and every guarantee of the performance and observance of the
covenants, conditions and agreements to be performed by the lessee or sublessee
under any such lease or sublease. For purposes hereof, the term "Lease" shall
include any license agreement, concession agreement or other occupancy
agreement. Notwithstanding the foregoing, the term "Lease" shall not include any
transient room rentals.
"Leased Facilities" means, collectively, the Leased Land and any buildings
and improvements now or hereafter located thereon.
"Leased Land" means, collectively, the Marina Lease and any other land
that is now or hereafter subject to a Facility Lease.
"Legal Requirements" means all laws, statutes, codes, acts, ordinances,
orders, judgments, decrees, injunctions, rules, regulations, permits, licenses,
authorizations, directions and requirements (including, without limitation, the
New Jersey Casino Control Act, the New Jersey Industrial Site Recovery Act and
the New Jersey Spill Compensation and Control Act of
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1976) of all governments, departments, commissions, boards, courts, authorities,
agencies, officials and officers, of governments, federal, state and municipal
(including, without limitation, the New Jersey Department of Environmental
Protection, the Atlantic City Bureau of Investigations, the Division of Gaming
Enforcement of the State of New Jersey, and the Casino Control Commission of the
State of New Jersey), foreseen or unforeseen, ordinary or extraordinary, which
now are or at any time hereafter become applicable to the Trust Estate or any
part thereof, or any of the adjoining sidewalks, or any use or condition of the
Trust Estate or any part thereof, including, without limitation, the use of the
Casino Hotel as a gaming or gambling facility.
"Lessors" means the lessors under the Facility Leases.
"Marina Lease" means the lease agreement made September 1, 1990 between
the State of New Jersey, as Landlord, and Mortgagor, as tenant, respecting
property known as the Senator Frank S. Farley State Marina, Atlantic City, New
Jersey, being designated as a portion of Block B-4, Lot 11 on the tax map of the
City of Atlantic City, Atlantic County, New Jersey, as more particularly
described on Schedule A appended hereto and made a part hereof, together with
all amendments, restatements, extensions and renewals of said lease agreement, a
memorandum of which Lease was recorded June 2, 1992 in the Atlantic County
Registry of Deeds in Book 5365, Page 211.
"Maturity" when used with respect to any Indebtedness means the date on
which the principal (or any portion thereof) of such Indebtedness becomes due
and payable as therein or herein provided, whether at the Stated Maturity, upon
acceleration, optional redemption, required repurchase, scheduled principal
payment or otherwise.
"Mortgage Documents" has the meaning set forth in Section 1.1 of the
Mortgage Note Indenture.
"Mortgage Note Indenture" means that certain indenture dated as of
December 28, 1993 among the Company, as issuer, the Mortgagor, as guarantor, and
First Bank National Association (now known as U.S. Bank National Association),
as trustee, as it may be amended from time to time, relating to the Company's
Mortgage Notes.
"Mortgage Notes" means the 11-3/4% Mortgage Notes due 2003 issued by the
Company pursuant to the Mortgage Note Indenture.
"Mortgagee" has the meaning set forth in the first paragraph of this
instrument and its successors and assigns.
"Mortgages" mean the Senior Guarantee Mortgage, the Senior Note Mortgage,
the TCHI Note Guarantee Mortgage and the Senior Partnership Upstream Note
Mortgage.
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"Mortgagor" means the Person named as "Mortgagor" in the first paragraph
of this instrument until a successor entity shall have become such pursuant to
the applicable provisions of this Mortgage, and thereafter, except to the extent
otherwise contemplated by Section 4.2, "Mortgagor" shall mean such successor
entity exclusively.
"Mortgagor Order" and "Mortgagor Request" mean, respectively, a written
order or request signed with a Mortgagor Signature and delivered to Mortgagee.
"Mortgagor Signature" means the signature of the President or a Vice
President or a general partner of Mortgagor.
"Mortgagor's Certificate" means a certificate signed with a Mortgagor
Signature and delivered to Mortgagee.
"Notices" has the meaning set forth in Section 1.2.
"Operating Assets" has the meaning set forth in Granting Clause Sixth.
"Opinion of Counsel" means a written opinion of counsel who may (except as
otherwise expressly provided in this Mortgage) be an employee of Mortgagor or of
an Affiliate of Mortgagor.
"Original Policy" means the ALTA Loan Policies of Title Insurance issued
by First American Title Insurance Company, Chicago Title Insurance Company and
Commonwealth Land Title Insurance Company, pursuant to Title Commitment. No.
L980366, dated the date hereof.
"Outstanding Amount" has the meaning set forth in Section 1.1 of the TCHI
Note Indenture.
"Owned Land" has the meaning set forth in Granting Clause First.
"Permits" means all licenses, franchises, authorizations, statements of
compliance, certificates of operation, certificates of occupancy and permits
required for the lawful ownership, occupancy, operation and use of all or a
material portion of the Premises whether held by Mortgagor or any other Person
(which may be temporary or permanent) (including, without limitation, those
required for the use of the Casino Hotel as a licensed casino facility), in
accordance with all applicable Legal Requirements.
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"Permitted Encumbrances" means:
(1) liens for taxes, assessments, or governmental charges not yet due and
payable, or if due and payable not delinquent, to the extent that any fine,
penalty, interest or cost may be added for nonpayment thereof;
(2) Existing Encumbrances;
(3) F,F&E Financing Agreements permitted by the Senior Note Indenture or
the TCHI Note Indenture;
(4) the liens of the Trustee provided for in Section 6.6 of the Senior
Note Indenture or the TCHI Note Indenture and of the trustees under the
corresponding sections of the Mortgage Note Indenture and the PIK Note
Indenture;
(5) any lien or encumbrance which, under the provisions of Section 5.7,
constitutes a Permitted Encumbrance;
(6) Restricted Encumbrances;
(7) Working Capital Facility Mortgage (including the TCHI Note Guarantee
Mortgage and the Senior Partnership Upstream Note Mortgage);
(8) the liens of the Mortgage Documents;
(9) the liens of the Mortgages and any rights granted as provided therein;
(10) any lien or encumbrance permitted under Section 5.3 of this Mortgage;
(11) any lien or encumbrance securing purchase money indebtedness
permitted by the Senior Note Indenture and the TCHI Note Indenture;
(12) modifications, refinancings, extension, renewals or replacements, in
whole or in part, of the liens described in clauses (2) through (11) of this
definition to the extent permitted by the Senior Note Indenture and the TCHI
Note Indenture; and
(13) any Facility Lease now existing or hereafter entered into.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or any other entity or government or any agency or
political subdivision thereof.
"PIK Note Indenture" means that certain indenture dated as of December 28,
1993
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among the Company, as issuer, the Mortgagor, as guarantor, and First Bank
National Association (now known as U.S. Bank National Association), as trustee,
as it may be amended from time to time, relating to the Company's PIK Notes.
"PIK Notes" means the Company's 13 7/8% Pay-in-Kind Notes due 2005.
"Premises" has the meaning set forth in Granting Clause Fourth.
"Restoration" has the meaning set forth in Section 5.10(e)(iii).
"Restricted Encumbrances" means any Leases permitted by and made in
accordance with Section 5.12 of this Mortgage.
"Securities Act" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Senior Guarantee" means the guarantee by Mortgagor of the Company's
Indenture Obligations (as defined in the Senior Note Indenture) pursuant to
Article Fourteen of the Senior Note Indenture.
"Senior Guarantee Mortgage" means the Indenture of Mortgage and Security
Agreement of even date herewith between U.S. Bank National Association, as
trustee, as mortgagee, and Mortgagor, as mortgagor, securing the Senior
Guarantee and evidencing a lien pari passu with the lien of this Mortgage, the
lien of the Senior Note Mortgage, the lien of the TCHI Note Guarantee Mortgage,
and the lien of any other Working Capital Facility Mortgage.
"Senior Indebtedness" means Indebtedness evidenced by the Senior
Partnership Note, the Senior Guarantee, the Senior Notes and any Working Capital
Facility (including, without limitation the TCHI Notes and the TCHI Guarantee)
and any amendments, extensions, renewals, replacements or restatements of any of
the foregoing to the extent permitted by the Senior Note Indenture and the TCHI
Note Indenture.
"Senior Mortgages" means the Senior Guarantee Mortgage and the Senior Note
Mortgage.
"Senior Note Indenture" means that certain indenture of even date herewith
between the Company, as issuer, the Mortgagor, as guarantor and U.S. Bank
National Association, as trustee, relating to the Senior Notes as it may from
time to time be supplemented, modified or amended by one or more trust
indentures or other instruments supplemental thereto entered into pursuant to
the applicable provisions thereof .
"Senior Note Mortgage" means the Indenture of Mortgage and Security
Agreement dated as of the date hereof between the Company, as mortgagee, and
Mortgagor, as mortgagor, which evidences a lien pari passu with the lien of this
Senior Partnership Upstream
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Note Mortgage, the lien of the Senior Guarantee Mortgage, the lien of TCHI Note
Guarantee Mortgage, and the lien of any other Working Capital Facility Mortgage.
"Senior Notes" means the 10 1/4% Senior Secured Notes due 2003 in the
original principal amount of $62,000,000 issued by the Company in the original
principal amount of $62,000,000 under the Senior Note Indenture.
"Senior Partnership Note" means that certain promissory note of even date
herewith in the original principal amount of $62,000,000 made by the Mortgagor
in favor of the Company, a copy of which is attached to the Senior Note
Indenture, and any amendments, extensions, renewals, replacements or
restatements thereof.
"Senior Partnership Upstream Note" means that certain promissory note of
even date herewith in the original principal amount of $5,000,000 made by the
Mortgagor in favor of TCHI, a copy of which is attached to the TCHI Note
Indenture, and any amendments, extensions, renewals, replacements or
restatements thereof.
"Senior Partnership Upstream Note Mortgage" means this Indenture of
Mortgage and Security Agreement, which evidences a lien pari passu with the lien
of the Senior Note Mortgage, the lien of the Senior Guarantee Mortgage, the lien
of the TCHI Note Guarantee Mortgage and the lien of any other Working Capital
Facility Mortgage.
"Senior TCHI Assignment Agreement" means the Senior TCHI Assignment
Agreement of even date herewith made by TCHI to the Trustee and acknowledged by
Mortgagor, providing for the assignment to the Trustee of the Senior Partnership
Upstream Note and this Senior Partnership Upstream Note Mortgage.
"Settlement Costs" has the meaning set forth in Section 5.17.
"Stated Maturity" when used with respect to any Indebtedness, means the
date specified in such Indebtedness as the fixed date on which the principal of
such Indebtedness is due and payable.
"Superior Instrument Requirements" means the applicable terms, conditions
and provisions of any documentation which constitutes, evidences, secures or
governs any Senior Indebtedness, together with the terms and provisions of the
Marina Lease.
"Taking" means the acquisition or condemnation by eminent domain of the
whole or any part of the Premises, by a competent authority, for any public or
quasi-public use or purpose.
"Tangible Personal Property" has the meaning set forth in subclause (f) of
Granting Clause Sixth.
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"TCHI" means Trump's Castle Hotel & Casino, Inc., a corporation
incorporated under the laws of the State of New Jersey, or any other obligor on
the TCHI Notes (other than Mortgagor).
"TCHI Guarantee" means the guarantee by Mortgagor of TCHI's Indenture
Obligations (as defined in the TCHI Note Indenture) pursuant to Article 14 of
the TCHI Note Indenture.
"TCHI Notes" means the 10 1/4% Senior Secured Notes due 2003 in the
original principal amount of $5,000,000 issued by TCHI pursuant to the TCHI Note
Indenture.
"TCHI Note Indenture" means that certain indenture of even date herewith
among TCHI, as issuer, Mortgagor as guarantor and the Trustee, as trustee,
relating to the TCHI Notes as it may from time to time be supplemented, modified
or amended by one or more trust indentures or other instruments supplemental
thereto entered into pursuant to the applicable provisions thereof.
"TCHI Note Guarantee Mortgage" means the Indenture of Mortgage and
Security Agreement of even date herewith between the Trustee, as mortgagee, and
Mortgagor, as mortgagor, securing the TCHI Guarantee and evidencing a lien pari
passu with the lien of this Senior Partnership Upstream Note Mortgage, the lien
of the Senior Note Mortgage, the lien of the Senior Guarantee Mortgage and the
lien of any other Working Capital Facility Mortgage.
"Trust Estate" has the meaning stated in the habendum to the Granting
Clauses.
"Trust Indenture Act" has the meaning set forth in Section 1.1 of the
Trust Indenture.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of the TCHI Note Indenture and any successor thereto.
"Uniform Commercial Code" means the New Jersey Uniform Commercial Code
N.J.S.A. 12A:1-101, et seq.
"Working Capital Facility" has the meaning set forth in Section 1.1 of the
TCHI Note Indenture.
"Working Capital Facility Mortgage" means any mortgage or other security
interest (including, without limitation, the TCHI Note Guarantee Mortgage and
this Senior Partnership Upstream Note Mortgage) or agreement which secures a
Working Capital Facility and which evidences a lien pari passu with the lien of
this Senior Partnership Upstream Note Mortgage, the lien of the Senior Note
Mortgage, the lien of the Senior Guarantee Mortgage, and the lien of the TCHI
Note Guarantee Mortgage.
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Section 1.2. Notices.
(a) Any request, demand, authorization, direction, notice (including,
without limitation, a notice of default), consent, waiver or other document
provided or permitted by this Mortgage to be made upon, given or furnished to,
or filed with, Mortgagor, Mortgagee or the Trustee (collectively, "Notices")
shall be in writing and shall be deemed given either (i) when delivered by hand
(including by overnight courier) or (ii) two days after sending by registered or
certified mail, postage prepaid, addressed as follows:
To Mortgagor:
Trump's Castle Associates, L.P.
Trump Marina Hotel Casino
Brigantine Boulevard and Huron Avenue
Atlantic City, New Jersey 08401
Attn: Chief Financial Officer
and and after May 26, 1998:
Willkie Farr & Gallagher Willkie Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, NY 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
To Mortgagee:
Trump's Castle Funding, Inc.
Trump Marina Hotel Casino
Brigantine Boulevard and Huron Avenue
Atlantic City, New Jersey 08401
Attn: Chief Financial Officer
and and after May 26, 1998
Willkie Farr & Gallagher Willkie Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, NY 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
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To the Trustee:
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Administration
(b) By Notice to Mortgagor, Mortgagee and the Trustee, any party may
designate additional or substitute addresses for Notices which, notwithstanding
Subsection (a) above, shall be deemed given when received. So long as the
Assignment Agreement is in effect, all Notices to and from Mortgagee shall be
given solely to and by the Trustee.
Section 1.3. Form and Contents of Documents Delivered to Mortgagee.
Whenever several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other such matters in one or several documents.
Any certificate or opinion of a general partner of Mortgagor may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such general partner knows that the
certificate or opinion or representations with respect to the matters upon which
his certificate or opinion is based are erroneous. Any Opinion of Counsel may be
based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, a general partner of Mortgagor stating that the
information with respect to such factual matters is in the possession of
Mortgagor, unless such counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous. If appropriate to
the matter being opined upon and to the extent not prohibited by the Trust
Indenture Act, conclusions stated in any Opinion of Counsel may be subject to
rights of creditors and the availability of equitable remedies.
Whenever any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Mortgage, they may, but need not, be consolidated to form
one instrument.
Whenever in this Mortgage, in connection with any application or
certificate or report to Mortgagee, it is provided that Mortgagor shall deliver
any document as a condition of the granting of such application, or as evidence
of Mortgagor's compliance with any term hereof, it is intended that the truth
and accuracy, at the time of the granting of such application or at the
effective date of such certificate or report (as the case may be), of the facts
and opinions stated in such document shall in such case be conditions precedent
to the right of Mortgagor to have such application granted or to the sufficiency
of such certificate or report.
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Every application, certificate, report, affidavit, opinion, consent,
statement or other instrument required to be delivered to Mortgagee under this
Senior Partnership Upstream Note Mortgage shall be in writing and shall be
prepared and delivered without cost or expense to Mortgagee.
Section 1.4. Compliance Certificates and Opinions.
Upon any application or request by Mortgagor to Mortgagee to take any
action under any provision of this Senior Partnership Upstream Note Mortgage,
Mortgagor shall furnish to Mortgagee a Mortgagor's Certificate stating that all
conditions precedent, if any, provided for in this Senior Partnership Upstream
Note Mortgage relating to the proposed action have been complied with and an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Senior Partnership Upstream
Note Mortgage relating to such particular application or request, no additional
certificate or opinion need be furnished. Every certificate or opinion with
respect to compliance with a condition or covenant provided for in this Senior
Partnership Upstream Note Mortgage shall include:
(a) a statement that each individual signing such certificate or opinion
has read such condition or covenant and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such condition or covenant has been
complied with; and
(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 1.5. Effect of Headings and Table of Contents.
The Article and Section headings herein and in the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 1.6. Successors and Assigns; Amendments.
(a) Subject to the provisions of Sections 1.10 and 4.2 hereof and Sections
3.11 and 8.2 of the TCHI Note Indenture, and without limiting the generality of
Section 1.12 hereof, this Mortgage shall be binding upon and inure to the
benefit of the parties hereto and of the respective successors and assigns of
the parties hereto to the same effect as if each such
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successor or assign were in each case named as a party to this Mortgage.
(b) This Senior Partnership Upstream Note Mortgage may not be modified,
amended, discharged, released nor any of its provisions waived except by
agreement in writing executed by Mortgagor and Mortgagee and in accordance with
the provisions of this Mortgage and the TCHI Note Indenture.
Section 1.7. Separability Clause.
In case any provision in this Mortgage or the Senior Partnership Upstream
Note shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 1.8. Benefits of Mortgage.
Without limiting the generality of Section 3.12, nothing in this Mortgage
or in the Senior Partnership Upstream Note, express or implied, shall give to
any Person, other than the parties hereto and their successors and assigns, any
benefit or any legal or equitable right, remedy or claim under this Mortgage.
Section 1.9. Governing Law.
This Senior Partnership Upstream Note Mortgage shall be deemed to be a
contract under the laws of the State of New Jersey and shall be construed in
accordance with and governed by the laws of the State of New Jersey.
Section 1.10. Limitation on Liability.
Notwithstanding anything herein or in any other agreement, document,
certificate, instrument, statement or omission referred to below to the
contrary, Mortgagor is liable hereunder only to the extent of the assets of
Mortgagor and no other person or entity, including, without limitation, any
partner, officer, committee or committee member of Mortgagor or any partner
therein or in any partnership Affiliate of Mortgagor, or any incorporator,
officer, director or shareholder of any corporate partner of Mortgagor or of any
corporate Affiliate of Mortgagor, or any Affiliate or controlling person or
entity of any of the foregoing, or any agent, employee, or lender of any of the
foregoing, or any successor, personal representative, heir or assign of any of
the foregoing, in each case past, present or as they may exist in the future,
shall be liable in any respect (including, without limitation, the breach of any
representation, warranty, covenant, agreement, condition or indemnification or
contribution undertaking contained herein or therein) under, in connection with,
arising out of or relating to this Senior Partnership Upstream Note Mortgage, or
any other agreement, document, certificate, instrument or statement (oral or
written) related to, executed or to be executed, delivered or to be delivered,
or made or to be made, or any omission made or to be
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made, in connection with any of the foregoing or any of the transactions
contemplated in any such agreement, document, certificate, instrument, or
statement. Any agreement, document, certificate, statement or other instrument
to be executed simultaneously with, in connection with, arising out of or
relating to this Senior Partnership Upstream Note Mortgage or any other
agreement, document, certificate, statement or instrument referred to above, or
any agreement, document, certificate, statement or instrument contemplated
hereby shall contain language mutatis mutandis to this Section 1.10 and, if such
language is omitted, shall be deemed to contain such language.
Section 1.11. Provisions Required by TCHI Note Indenture.
Whenever the provisions of this Senior Partnership Upstream Note Mortgage
and the provisions of the TCHI Note Indenture shall be inconsistent, the
provisions of the TCHI Note Indenture shall govern.
Section 1.12. References to Mortgagee and/or to Trustee; Rights of Trustee.
(a) Whenever reference is made in this Mortgage to the rights, powers and
remedies of Mortgagee or to Notices to or by Mortgagee, the same shall apply to
Trump's Castle Hotel & Casino, Inc. only so long as Trump's Castle Hotel &
Casino, Inc. is the holder of this Mortgage and the Senior Partnership Upstream
Note. Subsequent to the assignment thereof on the date of and pursuant to the
Senior TCHI Assignment Agreement by Trump's Castle Hotel & Casino, Inc. to the
Trustee (who shall have and hold all such rights, powers and remedies on behalf
of the Holders in accordance with the terms of the TCHI Note Indenture) and for
so long as there shall not have been effected a cancellation and discharge of
the assignment pursuant to Article V of the Senior TCHI Assignment Agreement,
such rights, powers and remedies of Mortgagee and any Notices to or by
Mortgagee, shall apply only to the Trustee with the same force and effect as if
(i) such rights, powers and remedies were specifically granted by this Senior
Partnership Upstream Note Mortgage and the Senior Partnership Upstream Note
directly to the Trustee and (ii) the Trustee were the named Mortgagee with
respect to the giving and receiving of Notices under Section 1.2. Upon such
assignment of this Senior Partnership Upstream Note Mortgage, the Trustee shall
be named in lieu of Trump's Castle Hotel & Casino, Inc., as a named insured
under the policies of insurance set forth in Section 5.10 hereof (except that
with respect to the policy described in Section 5.10(a)(iii) of this Mortgage,
Trump's Castle Hotel & Casino, Inc. may, at Mortgagor's election, be named as an
additional insured).
(b) So long as there shall not have been effected a cancellation and
discharge of the assignment pursuant to Article V of the Senior TCHI Assignment
Agreement, except as otherwise provided in Section 6.2 of the TCHI Note
Indenture:
(1) Mortgagee may rely, and shall be protected in acting or
refraining from acting, upon any resolution, certificate, statement,
instrument, opinion, report, notice,
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request, direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(2) any request or direction of Mortgagor mentioned herein shall be
sufficiently evidenced by a Mortgagor Request or Mortgagor Order;
(3) whenever in the administration of this Mortgage, Mortgagee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, Mortgagee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon a Mortgagor's Certificate;
(4) Mortgagee may consult with counsel and any written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by Mortgagee hereunder in good faith and in reliance thereon;
(5) Mortgagee shall be under no obligation to exercise any of the
rights or powers vested in it by this Mortgage at the request or direction
of any of the Holders pursuant to the TCHI Note Indenture, unless such
Holders shall have offered to Mortgagee reasonable security or indemnity
against the costs, expenses and liabilities which might be incurred
therein or thereby in compliance with such request or direction;
(6) Mortgagee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, appraisal, bond, debenture, note, coupon, security or other
paper or document but Mortgagee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit,
and, if Mortgagee shall determine to make such further inquiry or
investigation, it shall be entitled (subject to the express limitations
with respect thereto contained in this Senior Partnership Upstream Note
Mortgage) to examine the books, records and premises of Mortgagor,
personally or by agent or attorney;
(7) Mortgagee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys, and Mortgagee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder;
(8) Mortgagee shall not be personally liable, in case of entry by it
upon the Trust Estate, for debts contracted or liabilities or damages
incurred in the management or operation of the Trust Estate;
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(9) Mortgagor shall pay or cause to be paid to the Trustee all
compensation and other amounts provided in Section 6.6 of the TCHI Note
Indenture; and
(10) no provision of this Mortgage shall require Mortgagee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of its obligations hereunder, or in the exercise of any of its
rights or powers.
(c) The provisions of Section 1.12(a) shall apply to all Mortgage
Documents executed in favor of Trump's Castle Hotel & Casino, Inc. The
provisions of Section 1.12(b) shall apply to all Mortgage Documents.
Section 1.13. Mortgage Subject to Casino Control Act.
Each provision of this Senior Partnership Upstream Note Mortgage is
subject to and shall be enforced in compliance with the provisions of the New
Jersey Casino Control Act.
Section 1.14. Discharge of Lien.
If (a) Mortgagor shall pay or cause to be paid, or there shall otherwise
be paid, to Mortgagee all amounts required to be paid by Mortgagor pursuant to
this Mortgage and the Senior Partnership Upstream Note and the conditions
precedent for the TCHI Note Indenture to cease, determine and become null and
void (except for any surviving rights of transfer or exchange of the TCHI Notes
provided in Section 13.1 of the TCHI Note Indenture and for the obligation to
pay the Trustee's fees and expenses provided in Section 6.6 of the TCHI Note
Indenture) in accordance with Section 13.1 of the TCHI Note Indenture shall have
occurred, or (b) there shall have occurred a "defeasance" (as defined in Section
4.2 of the TCHI Note Indenture) of the TCHI Notes, or (c) there shall have
occurred a "covenant defeasance" (as defined in Section 4.3 of the Trust
Indenture), then in any such case Mortgagee shall promptly cancel and discharge
this Mortgage, and any financing statements filed in connection herewith and
execute and deliver to Mortgagor all such instruments as may be necessary,
required or appropriate to evidence such discharge and satisfaction of said lien
or liens.
Section 1.15. General Application.
(a) The remedies of Mortgagee upon any default by Mortgagor in the
fulfillment of any of its obligations hereunder shall be limited in each
instance by the provisions of Section 1.10, whether or not the provisions
providing for such remedies explicitly refer to such Section.
(b) The assertion of any rights upon any Default shall be subject in each
instance to, if required, the giving of any notice and the expiration of any
grace period provided for in Section 3.1 as a condition to such Default becoming
an Event of Default, unless the Trust Indenture Act requires otherwise, in which
case the Trust Indenture Act shall control.
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(c) For the purposes of this Senior Partnership Upstream Note Mortgage, it
is understood that an event which does not materially diminish the value of
Mortgagee's interest in the Trust Estate shall not be deemed an "impairment of
security," as that phrase is used in this Mortgage.
Section 1.16. Senior Partnership Upstream Note Mortgage Deemed to be Security
Agreement.
To the extent that the grant of a security interest in any portion of the
Trust Estate is governed by the Uniform Commercial Code, this Senior Partnership
Upstream Note Mortgage is hereby deemed to be as well a security agreement under
the Uniform Commercial Code for the purpose of creating hereby a security
interest in all of Mortgagor's right, title and interest in and to said
property, securing the obligations secured hereby, for the benefit of Mortgagee.
Section 1.17. No Duplication of Notices or Payments.
Whenever it is provided in this Senior Partnership Upstream Note Mortgage
and the TCHI Note Guarantee Mortgage, that Mortgagor shall deliver any notice or
document, or is required to make any payment, the delivery of such notice or
document or the making of such payment shall constitute the delivery of such
notice or document or the making of such payment in satisfaction of the terms,
conditions and provisions of this Senior Partnership Upstream Note Mortgage, and
the TCHI Note Guarantee Mortgage, provided that such notice, document or payment
states, or is accompanied by a letter stating, that such notice, document or
payment is being delivered in satisfaction of the terms, conditions and
provisions of both this Mortgage and the TCHI Note Guarantee Mortgage.
ARTICLE TWO
RELEASE; SUBORDINATION
Section 2.1. Possession by Mortgagor.
So long as there shall have been no acceleration of maturity of the Senior
Partnership Upstream Note under Section 3.2, Mortgagor shall be suffered and
permitted, with power freely and without let or hindrance on the part of
Mortgagee, subject to the provisions of this Mortgage and the TCHI Note
Indenture, to possess, use, manage, operate and enjoy the Trust Estate and every
part thereof and to collect, receive, use, invest and dispose of the rents,
issues, tolls, profits, revenues and other income from the Trust Estate or any
part thereof, to use, consume and dispose of any consumables, goods, wares and
merchandise in the ordinary course of business of operating the Casino Hotel and
to adjust and settle all matters relating to choses in action, leases and
contracts.
Section 2.2. Obsolete Property.
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Mortgagor shall have the right, at any time and from time to time, unless
an Event of Default shall have occurred and be continuing, without any release
from or consent by Mortgagee:
(a) to sell or dispose of, free from the lien of this Mortgage, any
Tangible Personal Property which, in its reasonable opinion, may have become
obsolete or unfit for use or which is no longer necessary in the conduct of its
businesses or the operation of the Trust Estate, and no purchaser of any such
property shall be bound to inquire into any question affecting Mortgagor's right
to sell or otherwise dispose of the same free from the lien of this Mortgage;
(b) to alter, repair, replace, change the location or position of and add
to any Tangible Personal Property; provided, however, that no change shall be
made in the location of any such property subject to the lien of this Mortgage
which would in any respect impair the security of this Mortgage upon such
property; or
(c) to renew, extend, surrender, terminate, modify or amend any leases of
Tangible Personal Property, when, in Mortgagor's reasonable opinion, it is
prudent to do so.
Mortgagor shall retain any net cash proceeds received from the sale or
disposition of any Tangible Personal Property under Subsection (a) of this
Section 2.2, in the business of operating the Casino Hotel.
Mortgagee shall be under no responsibility or duty with respect to the
exercise of the rights of Mortgagor under this Section 2.2 or the application of
the proceeds of any sale or disposition of any Tangible Personal Property.
Mortgagee shall, from time to time, promptly execute any written
instrument in form satisfactory to Mortgagee to confirm the propriety of any
action taken by Mortgagor under this Section 2.2, upon receipt by Mortgagee of a
Mortgagor Request requesting the same, together with a Mortgagor's Certificate
stating that the action so to be confirmed was duly taken in conformity with
this Section 2.2, and that the execution of such written instrument is
appropriate to confirm the propriety of such action under this Section 2.2;
provided, that Mortgagee shall have no liability thereunder and all costs and
expenses (including, without limitation, reasonable attorneys' fees and
disbursements) shall be paid by Mortgagor.
Section 2.3. F,F&E Financing Agreements.
Notwithstanding any provision contained in this Mortgage or the TCHI Note
Indenture to the contrary, if Mortgagor acquires Tangible Personal Property
and/or other items constituting operating assets subject to any F,F&E Financing
Agreement, or becomes the lessee under a lease for any of the same and if the
document evidencing such F,F&E Financing Agreement prohibits subordinate liens
or the provisions of any such lease prohibits any assignment thereof by the
lessee, and if any such prohibition is customary with respect to
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similar transactions of the lender or lessor (as evidenced by a Mortgagor's
Certificate delivered to Mortgagee, together with such other evidence as
Mortgagee may reasonably request), as the case may be, then the property so
purchased or the lessee's interest in the lease, as the case may be, shall be
deemed to be Excepted Property. If any such F,F&E Financing Agreement permits
subordinate liens, then Mortgagee shall execute and deliver to Mortgagor, at
Mortgagor's expense, such documents as the holder of such F,F&E Financing
Agreement may reasonably request to evidence the subordination of the lien of
this Mortgage and the Mortgage Documents to the lien of such F,F&E Financing
Agreement; provided, however, that Mortgagee shall have no obligation to execute
and deliver such documents, and the lien of this Mortgage shall not be
subordinate to any such F,F&E Financing Agreement, unless (a) such F,F&E
Financing Agreement shall contain a provision binding upon the holder of such
F,F&E Financing Agreement that (i) if the holder of such F,F&E Financing
Agreement shall give to Mortgagor any notice of default thereunder, such holder
shall at the same time and in the same manner serve a copy of such notice on
Mortgagee at the address designated herein (or such other address as Mortgagee
may designate by notice given to the holder of such F,F&E Financing Agreement in
the manner provided for notices hereunder), and that no such notice to Mortgagor
shall be deemed to have been duly given unless and until a copy thereof has been
so provided to Mortgagee, and (ii) promptly following the last date upon which
Mortgagor may cure such default, if Mortgagor shall fail to cure such default,
the holder of such F,F&E Financing Agreement shall give notice to Mortgagee
stating the manner in which Mortgagor shall have failed to cure its said
default, in which event Mortgagee shall be permitted to cure the default and,
with respect thereto, Mortgagee shall have the same amount of time, after such
notice, within which to cure the said default, as is provided for under the
provisions of such F,F&E Financing Agreement to be given to Mortgagor therefor
after notice or (b) Mortgagor delivers to Mortgagee a Mortgagor's Certificate
certifying that (i) the provision described in clause (a) is not customarily
included by the lender or lessor in its F,F&E Financing Agreements in similar
transactions and (ii) although Mortgagor has used reasonable efforts to have
included in such F,F&E Financing Agreement such a provision, Mortgagor has been
unsuccessful in obtaining such a provision.
ARTICLE THREE
REMEDIES
Section 3.1. Events of Default.
"Event of Default," whenever used herein, means any one of the following
events (including any applicable notice requirement and any period of grace, as
specified in this Section 3.1) (whatever the reason for such event and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) default in the payment of any interest on the TCHI Notes or the Senior
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Partnership Upstream Note when such interest becomes due and payable and
continuance of such default for a period of 30 days; or
(b) default in the payment of all or any portion of the principal of (or
premium, if any, on) the TCHI Notes or the Senior Partnership Upstream Note when
the same becomes due and payable at their Maturity; or
(c) default in the payment of any other sum due under the Senior
Partnership Upstream Note or this Senior Partnership Upstream Note Mortgage, and
the continuance of such default for a period of 30 days after there has been
given to Mortgagor a notice specifying such default and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder; or
(d) default in the payment or performance of any obligation under the
Senior Guarantee at the time such payment or performance is required under
Article Fourteen of the TCHI Note Indenture.
(e) default in the performance, or breach, of any covenant of Mortgagor in
this Senior Partnership Upstream Note Mortgage (other than a covenant, a default
in the performance or breach of which is elsewhere in this Section 3.1
specifically dealt with), and continuance of such default or breach for a period
of 30 days after there has been given to Mortgagor a notice specifying such
default or breach and requiring it to be remedied and stating that such notice
is a "Notice of Default" hereunder, unless (i) the default or breach is of such
a nature that is curable but not susceptible of being cured with due diligence
within such 30-day period (for reasons other than the lack of funds), (ii)
Mortgagor delivers a Mortgagor's Certificate to Mortgagee within such 30-day
period stating (A) the applicability of the provisions of clause (i) to such
default or breach, (B) Mortgagor's intention to remedy such default or breach
with reasonable diligence and (C) the steps which Mortgagor has undertaken or
intends to undertake to remedy such default or breach and (iii) Mortgagor
delivers to Mortgagee additional Mortgagor's Certificates every 30 days
thereafter updating the information contained in the certificate described in
clause (ii), in which case such 30-day period shall be extended for such further
period of time (but in no event more than 60 days after the last day of such
30-day period) as may reasonably be required to cure the same, provided that
Mortgagor is then proceeding and thereafter continues to proceed to cure the
same with reasonable diligence; or
(f) an "Event of Default," as defined in Section 5.1 of the TCHI Note
Indenture, shall occur and be continuing; or
(g) default by Mortgagor under any terms of any Facility Lease which shall
not be fully cured or waived prior to the expiration of any grace period (as
such grace period may be extended) contained in such Facility Lease; or
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(h) default in the performance, or breach, of any of the provisions of
Article Four hereof; or
(i) if any representation or warranty of Mortgagor set forth in this
Senior Partnership Upstream Note Mortgage or in any notice, certificate, demand
or request delivered to Mortgagee pursuant to this Mortgage shall prove to be
incorrect in any material respect as of the time when made.
(j) an "Event of Default", as defined in Section 3.1 of the Senior Note
Mortgage, the Senior Guarantee Mortgage, the TCHI Note Guarantee Mortgage or the
Mortgage Documents shall occur and be continuing.
An Event of Default shall not be deemed to exist by reason of any event
which Mortgagor is contesting in compliance with the provisions of Section 5.8.
Section 3.2. Acceleration of Maturity; Recision and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(g) or (h) of the TCHI Note Indenture) occurs and is continuing,
then, and in every such case, Mortgagee may declare the Outstanding Amount of
the Senior Partnership Upstream Note to be due and payable immediately, by a
notice in writing to Mortgagor and upon any such declaration such principal
shall become immediately due and payable. If an Event of Default specified in
such Section 5.1(g) or (h) occurs, the Outstanding Amount of the Senior
Partnership Upstream Note shall ipso facto become due and payable without any
declaration or other act on the part of the Mortgagee.
If at any time after such declaration of acceleration has been made, but
before any judgment or decree for payment of money due on the Senior Partnership
Upstream Note has been obtained by the Mortgagee, such declaration of
acceleration and its consequences has been duly rescinded and annulled in
accordance with Section 5.2 of the TCHI Note Indenture, then the declaration of
acceleration pursuant to this Section 3.2 shall automatically be rescinded and
annulled.
No such rescission and annulment shall affect any subsequent default or
impair any right consequent thereon.
Section 3.3. Application of Moneys Received by Mortgagee.
Any moneys received by Mortgagee pursuant to the provisions of this
Article Three (including moneys received by the Trustee after any action or act
by Mortgagee under Section 3.10) shall be applied by Mortgagee in accordance
with the provisions of Section 5.6 of the TCHI Note Indenture.
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Section 3.4. Restoration of Rights and Remedies.
If Mortgagee has instituted any proceeding to enforce any right or remedy
under this Senior Partnership Upstream Note Mortgage and such proceeding has
been discontinued or abandoned for any reason or has been determined adversely
to Mortgagee, then and in every such case Mortgagor and Mortgagee shall, subject
to any determination in such proceeding, be restored to their respective former
positions hereunder, and thereafter all rights and remedies of Mortgagee shall
continue as though no such proceeding had been instituted.
Section 3.5. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to Mortgagee is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 3.6. Delay or Omission Not Waiver.
No delay or omission of Mortgagee to exercise any right or remedy accruing
upon an Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right and
remedy given by this Article Three or by applicable law to Mortgagee may be
exercised, from time to time, and as often as may be deemed expedient, by
Mortgagee.
Section 3.7. Undertaking for Costs.
If any action or proceeding shall be commenced (including, without
limitation, an action to foreclose this Mortgage or to collect the indebtedness
secured hereby) to which action or proceeding Mortgagee is made or becomes a
party, or in which it becomes necessary in the opinion of Mortgagee to defend or
uphold the lien of this Senior Partnership Upstream Note Mortgage, Mortgagor
shall pay to Mortgagee all expenses, including, without limitation, reasonable
attorneys' fees, disbursements and court costs incurred by Mortgagee in
connection therewith, together with interest at the rate then payable on the
Senior Partnership Upstream Note, from the date of payment less the net amount
received by Mortgagee or the Trustee, as their interests may appear under any
title insurance policy, and, until paid, all such expenses, together with
interest as aforesaid, shall be secured by the lien of this Mortgage.
Section 3.8. Waiver of Appraisement and Other Laws.
To the full extent that it may lawfully so agree, Mortgagor will not at
any time insist upon, plead, claim or take the benefit or advantage of, any
appraisement, valuation, stay,
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extension or redemption law now or hereafter in force, in order to prevent or
hinder the enforcement of this Mortgage or the absolute sale of the Trust
Estate, or any part thereof, or the possession thereof by any purchaser at any
sale under this Article Three; and Mortgagor, for itself and all who may claim
under Mortgagor, so far as Mortgagor or they now or hereafter may lawfully do
so, hereby waives the benefit of all such laws. Mortgagor, for itself and all
who may claim under Mortgagor, waives, to the extent that Mortgagor may lawfully
do so, all right to have the property in the Trust Estate marshaled upon any
foreclosure hereof, and agrees that any court having jurisdiction to foreclose
this Mortgage may order the sale of the Trust Estate as an entirety.
If any law in this Section 3.8 referred to and now in force, of which
Mortgagor or its successor or successors might take advantage despite this
Section 3.8, shall hereafter be repealed or cease to be in force, such law shall
not thereafter be deemed to constitute any part of the contract herein contained
or to preclude the application of this Section 3.8.
Section 3.9. Entry.
Mortgagor agrees that upon the occurrence, and during the continuance, of
an Event of Default, Mortgagor, upon demand of Mortgagee, shall forthwith
surrender to Mortgagee the actual possession of, and it shall be lawful for
Mortgagee by such officers or agents as it may appoint to enter and take
possession of, the Trust Estate (and the books and papers of Mortgagor), and to
hold, operate and manage the Trust Estate (including the making of all needful
repairs, and such alterations, additions and improvements as Mortgagee shall
deem wise) and to receive the rents, issues, tolls, profits, revenues and other
income thereof, and, after deducting the costs and expenses of entering, taking
possession, holding, operating and managing the Trust Estate, as well as
payments for taxes, insurance and other proper charges upon the Trust Estate and
reasonable compensation to itself, its agents and counsel, to apply the same as
provided in Section 3.3; provided, however, that Mortgagee's rights under this
Section 3.9 shall be subject to the provisions of the New Jersey Casino Control
Act and Section 3.14. Whenever all that is then due upon the Senior Partnership
Upstream Note and under any of the terms of this Mortgage shall have been paid
and all defaults hereunder shall have been cured, Mortgagee shall surrender
possession to Mortgagor.
Section 3.10. Power of Sale; Suits for Enforcement.
If an Event of Default shall occur and be continuing, Mortgagee, with or
without entry, in its discretion, may:
(a) sell, subject to any mandatory requirements of applicable law, the
Trust Estate as an entirety, or in such parcels, as Mortgagee may determine, to
the highest bidder at public auction at such place and at such time (which sale
may be adjourned by Mortgagee from time to time in its discretion by
announcement at the time and place fixed for such sale, without further notice)
and upon such terms as Mortgagee may fix and briefly specify in a notice of
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sale to be published as required by law; or
(b) proceed to protect and enforce its rights under this Mortgage by sale
pursuant to judicial proceedings or by a suit, action or proceeding in equity or
at law or otherwise, whether for the specific performance of any covenant or
agreement contained in this Mortgage or in aid of the execution of any power
granted in this Mortgage or for the foreclosure of this Mortgage or for the
enforcement of any other legal, equitable or other remedy, as Mortgagee shall
deem most effectual to protect and enforce any of the rights of Mortgagee; the
failure to join tenants shall not be asserted as a defense to any foreclosure or
proceeding to enforce the rights of Mortgagee.
Section 3.11. Incidents of Sale.
Upon any sale of any of the Trust Estate, whether made under the power of
sale hereby given or pursuant to judicial proceedings, to the extent permitted
by law:
(a) the principal of and accrued interest on the Senior Partnership
Upstream Note, if not previously due, shall at once become and be immediately
due and payable;
(b) subject to the provisions of Section 3.14 and the receipt of any
required prior approvals of the New Jersey Casino Control Commission, Mortgagee
may bid for and purchase the property offered for sale, and upon compliance with
the terms of sale may hold, retain, possess and dispose of such property,
without further accountability, and may, in paying the purchase money therefor,
deliver the Senior Partnership Upstream Note or claims for interest thereon in
lieu of cash to the amount which shall, upon distribution of the net proceeds of
such sale, be payable thereon, and the Senior Partnership Upstream Note, in case
the amounts so payable thereon shall be less than the amount due thereon, shall
be returned to Mortgagee after being appropriately stamped to show partial
payment;
(c) Mortgagee may make and deliver to the purchaser or purchasers a good
and sufficient deed, bill of sale and instrument of assignment and transfer of
the property sold;
(d) Mortgagee is hereby irrevocably appointed the true and lawful attorney
of Mortgagor, in its name and stead, to make all necessary deeds, bills of sale
and instruments of assignment and transfer of the property thus sold; and for
that purpose it may execute all necessary deeds, bills of sale and instruments
of assignment and transfer, and may substitute one or more persons, firms or
corporations with like power, Mortgagor hereby ratifying and confirming all that
its said attorney or such substitute or substitutes shall lawfully do by virtue
hereof; but if so requested by Mortgagee or by any purchaser, Mortgagor shall
ratify and confirm any such sale or transfer by executing and delivering to
Mortgagee or to such purchaser or purchasers all proper deeds, bills of sale,
instruments of assignment and transfer and releases as may be designated in any
such request;
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(e) all right, title, interest, claim and demand whatsoever, either at law
or in equity or otherwise, of Mortgagor of, in and to the property so sold shall
be divested and such sale shall be a perpetual bar both at law and in equity
against Mortgagor, its successors and assigns, and against any and all persons
claiming or who may claim the property sold or any part thereof from, through or
under Mortgagor, its successors and assigns; and
(f) the receipt of Mortgagee or of the officer making such sale shall be a
sufficient discharge to the purchaser or purchasers at such sale for his or
their purchase money and such purchaser or purchasers and his or their assigns
or personal representatives shall not, after paying such purchase money and
receiving such receipt, be obliged to see to the application of such purchase
money, or be in anyway answerable for any loss, misapplication or
non-application thereof.
Section 3.12. Receiver.
Upon the occurrence of an Event of Default and commencement of judicial
proceedings by Mortgagee to enforce any right under this Mortgage, Mortgagee
shall be entitled, as against Mortgagor, without notice or demand and without
regard to the adequacy of the security for the Senior Partnership Upstream Note
or the solvency of Mortgagor, to the appointment of a receiver of the Trust
Estate, and of the rents, issues, profits, revenues and other income thereof;
provided, however, that Mortgagee's rights under this Section 3.12 shall be
subject to the provisions of the New Jersey Casino Control Act and Section 3.14
hereof.
Section 3.13. Suits to Protect the Trust Estate.
Mortgagor hereby acknowledges the right of Mortgagee, in the name and on
behalf of Mortgagor, (a) to appear in and defend any action or proceeding
brought with respect to the Trust Estate or any part thereof and (b) upon 5
days' prior notice to Mortgagor (or such shorter period or without notice if
deemed necessary and appropriate by Mortgagee), to institute and to maintain
such proceedings as Mortgagee may deem necessary and appropriate, but in the
case of (a) and (b) only to prevent any impairment of security or any impairment
of the Trust Estate by any acts which may be unlawful or in violation of this
Mortgage and to protect Mortgagee's interests in the Trust Estate and in the
rents, issues, profits, revenues and other income arising therefrom, including
the right to institute and maintain proceedings to restrain the enforcement of
or compliance with any governmental enactment, rule or order that may be
unconstitutional or otherwise invalid, if the enforcement of or compliance with
such enactment, rule or order would impair the security hereunder or be
materially prejudicial to the interests of Mortgagee.
Section 3.14. Management of the Premises.
Without limiting the generality of any other provision of this Article
Three, following an Event of Default and the taking of possession of the Trust
Estate or any part thereof by
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Mortgagee and/or the appointment of a receiver of the Trust Estate or any part
thereof, Mortgagee or any such receiver shall be authorized, in addition to the
rights and powers of Mortgagee and such receiver set forth elsewhere in this
Mortgage, to take any action permitted under Section 5.17 of the TCHI Note
Indenture.
ARTICLE FOUR
CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE
Section 4.1. Consolidation, Merger, Conveyance or Transfer only on Certain
Terms.
Mortgagor shall comply with all provisions applicable to Mortgagor in
Article Eight of the TCHI Note Indenture.
Section 4.2. Successor Entity Substituted.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer or disposition of the Trust Estate or any portion thereof in accordance
with Section 8.1 of the TCHI Note Indenture (other than a lease), the successor
Person formed by such consolidation or into which Mortgagor is merged or the
successor Person to which such sale, assignment, conveyance, transfer or
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, Mortgagor under this Mortgage with the same effect as
if such successor had been named as Mortgagor herein; and thereafter, except in
the case of a lease, the Person named as "Mortgagor" in the first paragraph of
this instrument or any successor Person which shall theretofore have become such
in the manner prescribed in this Article shall be discharged from all
obligations and covenants under this Mortgage.
ARTICLE FIVE
COVENANTS AND REPRESENTATIONS OF MORTGAGOR
Section 5.1. Payment of Principal, Premium and Interest.
Mortgagor shall duly and punctually pay the principal of (and premium, if
any) and interest on the Senior Partnership Upstream Note in accordance with the
terms of the Senior Partnership Upstream Note and this Mortgage.
Section 5.2. F,F&E Financing Agreements.
Mortgagor shall comply with all of the terms and conditions set forth in
any F,F&E
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Financing Agreements before the expiration of any applicable notice and cure
periods contained in the F,F&E Financing Agreements.
Section 5.3. Limitations on Liens and Transfers.
(a) Mortgagor shall not create, incur, suffer or permit to be created or
incurred or to exist any mortgage, lien, charge or encumbrance on or pledge of
any of the Trust Estate, other than (i) Permitted Encumbrances, (ii) a notice of
intention filed by a mechanic, materialman or laborer under the New Jersey
mechanic's lien law, and (iii) a building contract filed by a contractor or
subcontractor under the New Jersey mechanic's lien law. Without limiting the
generality of the foregoing sentence but notwithstanding the provisions of the
foregoing sentence, Mortgagor shall not be deemed to have breached the
provisions of the foregoing sentence by virtue of the existence of a lien for
Impositions or mechanics' liens so long as Mortgagor is in good faith contesting
the validity of the same in accordance with the provisions of Section 5.8.
(b) The lien of this Senior Partnership Upstream Note Mortgage on the date
hereof shall be superior, and not subordinate to the lien of any Permitted
Encumbrances (except for items 1, 2, 3, 4 and 11 contained in the definition of
Permitted Encumbrances and any other lien securing a Working Capital Facility
Mortgage to the extent that each thereof encumbers Mortgagor's interest in the
Trust Estate or any part thereof. Mortgagee shall from time to time after
receipt of a request of Mortgagee or the Trustee obtain instruments in form and
substance reasonably satisfactory to Mortgagee or the Trustee, as the case may
be, confirming the senior lien priority of this Senior Partnership Upstream Note
Mortgage over the lien of any such Permitted Encumbrances.
(c) Except as otherwise expressly permitted under this Mortgage and the
TCHI Note Indenture (including, without limitation, Article Eight of the TCHI
Note Indenture), Mortgagor shall not sell, assign, lease or otherwise transfer
all or any portion of the Trust Estate or any interest therein. Notwithstanding
the foregoing, Mortgagor shall have the right, at any time and from time to
time, unless an Event of Default shall have occurred and be continuing, without
any release from or consent by Mortgagee, to grant interests in the Owned Land
in the nature of rights-of-way or easements, or other rights or privileges in
the nature of easements; provided, (i) that none of the same will reduce or
impair, in any material respect, (A) the value or usefulness of the Trust Estate
or any part thereof or (B) the normal operation of the Casino Hotel in
accordance with all Legal Requirements and all Permits, (ii) Mortgagor has
delivered to Mortgagee a Mortgagor's Certificate, dated not earlier than 10 days
prior to the date of each such grant, certifying that (A) no Event of Default
has occurred and is continuing and (B) the conditions set forth in this Section
5.3(c) for such grant have been fulfilled and (iii) Mortgagor has delivered to
Mortgagee a duplicate original of the instrument, if any, pursuant to which such
grant is to be made, and such other instruments, certificates and opinions as
Mortgagee may reasonably request. The foregoing provisions of this Section
5.3(c) shall be self-operative and no further instrument shall be required to
evidence the
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consent of Mortgagee to the grant or other conveyance of such rights-of-way or
easements. Mortgagee shall, however, from time to time, after receipt of a
Mortgagor Request therefor (accompanied by a Mortgagor's Certificate stating
that said conditions have been satisfied) execute instruments in form and
substance reasonably satisfactory to Mortgagee confirming the permissibility of
such grant or other conveyance.
Section 5.4. Environmental.
Without limiting the generality of any other provision of this Mortgage,
Mortgagor covenants, represents and warrants to Mortgagee as follows:
(a) Mortgagor shall comply with any and all federal, state and local
environmental legislation, rules, and regulations in effect as of the date of
this Mortgage and subsequent thereto, including, without limitation, the Spill
Compensation and Control Act (N.J.S.A. 58:10-23. 11 et seq.) (the"Spill Act");
the Industrial Site Recovery Act (N.J.S.A. 13:1K-6 et seq.) ("IRSA"); the Solid
Waste Management Act (N.J.S.A. 13:E-1 et seq.); the Resource, Conservation and
Recovery Act (42 U.S.C. Section 6901 et seq.) ("RCRA"); the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 9601
et seq.) ("CERCLA") and such other environmental legislation, rules and
regulations, as are in or may come into effect and apply to (i) Mortgagor and/or
Mortgagee with respect to the Premises or (ii) the transactions contemplated
hereby, and as to any occupants or users of the collateral, whether as lessees,
tenants, licensees or otherwise, Mortgagor shall use its best efforts to cause
same to comply with said legislation, rules and regulations. Mortgagor agrees to
pay all costs required in connection with compliance with the foregoing
legislation, rules and regulations.
(b) Mortgagor has not used in the past, nor shall Mortgagor use in the
future, the Premises for the purpose of refining, producing, storing, handling,
transferring, processing or transporting "Hazardous Substances", as such term is
defined in IRSA, the Spill Act, CERCLA or the regulations relating thereto,
except that Mortgagor and its subsidiaries have used, and Mortgagor may continue
in the future to use, substances in the operation and maintenance of the
Premises, including, without limitation, heating oil, gasoline and cleaning
chemicals which could be considered as "Hazardous Substances" under the
preceding definition.
(c) To the best of Mortgagor's knowledge, after due inquiry and
investigation, none of the real property owned, leased and/or occupied by
Mortgagor and located in the State of New Jersey, including, without limitation,
the Premises, has been or is now being used as a "Major Facility" as such term
is defined in N.J.S.A. 58:10-23.11b(1). Mortgagor will not use the Premises in
the future as a "Major Facility".
(d) To the best of Mortgagor's knowledge, after due inquiry and
investigation, no lien has been attached to any revenues or any real or personal
property owned by Mortgagor or
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the Premises, as a result of the Chief Executive of the New Jersey Spill
Compensation Fund expending monies from said fund to pay for "Cleanup Costs", as
such term is defined in N.J.S.A. 58:10-23.11b(d), arising from an intentional or
unintentional action or omission of Mortgagor or any previous owner and/or
operator of such real property.
(e) There is no asbestos or asbestos containing material on the Premises.
To the best of Mortgagor's knowledge, there are no underground storage tanks
located at the Premises, other than those tanks previously disclosed to
Mortgagee and which are maintained in accordance with all material Legal
Requirements. Mortgagor has not installed or placed, or permitted to be
installed or placed, any underground storage tanks at or on the Premises, other
than those tanks previously disclosed to Mortgagee and which are maintained in
accordance with all material Legal Requirements. Underground storage tanks shall
have the definition as set forth in N.J.S.A. 58:10A-22(p).
(f) Mortgagor has not received a summons, citation, directive, letter,
other written communication, or, to the best of its knowledge, any oral
communication, from the New Jersey Department of Environmental Protection and
Energy or from any other person, firm or corporation concerning any intentional
or unintentional action or omission on Mortgagor's part resulting in the
releasing, spilling, leaking, pumping, pouring, emitting, emptying or dumping of
"Hazardous Substances", as such term is defined in N.J.S.A. 58:10-23.11b(k),
into the waters or onto the lands of the State of New Jersey, or into the waters
outside the jurisdiction of the State of New Jersey, in either case resulting in
damage to the lands, waters, fish, shellfish, wildlife, biota, air and other
resources owned, managed, held in trust or otherwise controlled by the State of
New Jersey.
(g) In connection with any purchase of the Premises or any business or
assets located thereon or any "closing, terminating or transferring operations"
of any "industrial establishment", as that term is defined in ISRA, occurring on
or after December 31, 1983, Mortgagor required that the owner and or operator of
the industrial establishment comply with the provisions of ECRA and the owner
and or operator did comply therewith.
(h) Upon the occurrence of an Event (as hereinafter defined), Mortgagee
shall have the right to have its consultants perform a comprehensive
environmental audit of the Premises. Such audit shall be conducted by an
environmental consultant chosen by Mortgagee and may include a visual survey, a
record review, an area reconnaissance assessing the presence of hazardous or
toxic waste or substances, PCBs or storage tanks at the Premises, an asbestos
survey of the Premises, which may include random sampling of the improvements
and air quality testing, and such further site assessments as Mortgagee may
reasonably require due to the results obtained from the foregoing. Mortgagor
grants Mortgagee, its agents, consultants and contractors the right to enter the
Premises for the purposes of performing such studies and the cost of such
studies shall be due and payable by Mortgagor to Mortgagee upon demand and shall
be secured by the lien of this Mortgage. Mortgagee shall direct the
environmental consultant to use its best efforts not to hinder Mortgagor's or
any tenant's operations when
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conducting such audit, sampling or inspections. For purposes of this paragraph,
the term "Event" shall mean (i) the occurrence of any Event of Default, (ii) the
issuance of any summons, citation, directive or similar written notice from the
New Jersey Department of Environmental Protection and Energy or from any other
local, state or federal entity or from any other person, firm or corporation
concerning any alleged material violation of any and all federal, state and
local environmental legislation, rules and regulations in effect as of the date
of this Mortgage and subsequent thereto or (iii) the initiation of any legal
action, suits or other legal or administrative proceedings relating to or in
connection with any alleged violation of any and all federal, state and local
environmental legislation, rules and regulations in effect as of the date of
this Mortgage and subsequent thereto.
(i) If a lien shall be filed against the Premises by the New Jersey
Department of Environmental Protection and Energy, pursuant to and in accordance
with the provisions of N.J.S.A. 58:10-23.11f(f), as a result of the Chief
Executive of the New Jersey Spill Compensation Fund having expended monies from
said fund to pay for "Damages", as such term is defined in N.J.S.A.
58:10-23.11g, and/or "Cleanup and Removal-Costs", as such term is defined in
N.J.S.A. 58:10-23(b), arising from an intentional or unintentional action or
omission of Mortgagor resulting in the releasing, spilling, pumping, pouring,
emitting, emptying or dumping of "Hazardous Substances", as such term is defined
in N.J.S.A. 58:10-23.11(b)k into waters of the State of New Jersey or onto lands
from which it might flow or drain into said waters, then, unless there is a good
faith basis for contesting such lien and Mortgagor is so contesting such lien in
accordance with Section 5.8, Mortgagor shall, within 30 days from the date that
Mortgagor is given notice that the lien has been placed against the Premises or
within such shorter period of time if the State of New Jersey has commenced
steps to cause the Premises to be sold pursuant to the lien, either (i) pay the
claim and remove the lien from the Premises, or (ii) furnish (A) a bond
satisfactory to a title company selected by Mortgagee (the "Title Insurer") in
the amount of the claim out of which the lien arises, (B) to the Trustee, a cash
deposit (which may be disbursed by the Trustee in its sole discretion) in the
amount of the claim out of which the lien arises, or (C) other security
reasonably satisfactory to Mortgagee in an amount sufficient to discharge the
claim out of which the lien arises.
(j) Mortgagor shall use its best efforts to cause compliance by all
lessees with all applicable Legal Requirements relating to environmental
protection.
(k) Mortgagor shall promptly provide Mortgagee with copies of all notices
received by or prepared by Mortgagor in connection with ISRA, CERCLA, the Spill
Act, RCRA or any other environmental law, rule or regulation relating to the
Premises. For purposes of this paragraph, the term "notice" shall mean any
summons, citation, directive, order, claim, pleading, letter, application,
filing, report, findings, declarations or other materials pertinent to
compliance of the Trust Estate and Mortgagor with such environmental laws, rules
or regulations.
(l) If this Mortgage is foreclosed, Mortgagor shall deliver the Premises
in
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compliance with all applicable federal, state and local environmental laws,
ordinances, rules and regulations, including, without limitation, ISRA.
(m) Without limiting the generality of Section 5.19, Mortgagor agrees to
defend, indemnify and save Mortgagee harmless from and against any loss or
liability, cost or expense (including, without limitation, reasonable attorneys'
fees, consultants' fees, disbursements and court costs) arising out of, or
incurred in connection with, Mortgagor's misrepresentation, or failure promptly
(but in no event to exceed the time period permitted by law) to comply with and
perform its obligations, under this Section 5.4. The provisions of this
subsection (m) shall survive any transfer of the Premises, including a transfer
after a foreclosure of this Mortgage.
Section 5.5. Warranty of Leasehold Estate and Title.
Mortgagor represents and warrants that as of the date hereof:
(a) Mortgagor is duly authorized under the laws of the State of New Jersey
and all other applicable laws to execute and deliver the Mortgage Documents, and
all partnership action on Mortgagor's part necessary for the valid execution and
delivery of the Mortgage Documents has been duly and effectively taken;
(b) Mortgagor is the lawful owner and is lawfully seized and possessed of
the Owned Land and all buildings and improvements thereon, free and clear of all
liens, charges or encumbrances, other than the Mortgages, the Mortgage Documents
and the Existing Encumbrances;
(c) Mortgagor is the holder of and has good and marketable title to the
leasehold interests and leasehold estates under all existing Facility Leases,
subject to no lien, encumbrance or charge other than the Mortgages, Mortgage
Documents and the Existing Encumbrances;
(d) (i) each existing Facility Lease is a valid and subsisting demise of
the respective Leased Land for the term therein set forth, (ii) there are no
defaults under any Facility Lease by any lessor or the lessee as to which
written notice has been given to or by the lessee, (iii) Mortgagor has delivered
to Mortgagee and the Trustee a true and correct copy of each existing Facility
Lease, and all modifications, amendments and supplements thereto, and (iv) each
existing Facility Lease is in full force and effect and has not been modified,
amended or supplemented, except as described on Schedule 3;
(e) Mortgagor has good title to the Operating Assets, subject to no lien,
encumbrance or charge, other than the Mortgage Documents and the Existing
Encumbrances;
(f) Mortgagor has good and lawful right and authority to execute this
Mortgage and to grant, bargain, sell, alien, convey, assign, transfer,
hypothecate, pledge, mortgage and
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confirm the Trust Estate as provided herein (including, without limitation, with
respect to the Operating Assets and Facility Leases), without the consent of any
third party, other than governmental authorities and other secured Persons but
any applicable or necessary consent or approval of any such governmental
authority and other such Persons has been given or waived in accordance with
applicable law at or prior to the execution and delivery of this Mortgage, and
this Mortgage constitutes a valid first mortgage lien and deed of trust and
first priority security interest in the Trust Estate, subject only to the
Existing Encumbrances and the pari passu liens of the Senior Note Mortgage, the
Senior Guarantee Mortgage and the TCHI Note Guarantee Mortgage;
(g)(i) all amounts due under the Mortgage Documents and the instruments
thereby have been paid to the extent they were due and payable to the date
hereof, and (ii) there is no existing default under said Mortgage Documents or
instruments, or in the performance of any of the terms, covenants, conditions or
warranties therein on the part of Mortgagor to be performed and observed
thereunder as to which written notice has been given to Mortgagor; and
(h) Mortgagor hereby does and shall forever warrant and defend (a) the
title to the Trust Estate (including, without limitation, Mortgagor's leasehold
estate under, and the lessee's interests in, each existing Facility Lease)
(subject to items 1 and 3 listed on Schedule 3) and (b) the pari passu liens of
the Mortgages thereon (subject to items 1 and 3 listed on Schedule 3), against
the claims and demands of all persons whomsoever, at Mortgagor's sole cost and
expense.
Section 5.6. After-Acquired Property; Further Assurances; Recording.
All property, real, personal or mixed or any interest therein (other than
Excepted Property), of every kind and description and wheresoever situate, which
may be hereafter acquired by Mortgagor (including, without limitation, fee title
to any Leased Land) shall immediately upon the acquisition thereof by Mortgagor,
and without any further mortgage, conveyance or assignment, become subject to
the lien of this Mortgage as fully as though now owned by Mortgagor and covered
by the Granting Clauses. Nevertheless, Mortgagor shall do, execute, acknowledge
and deliver all and every such further acts, conveyances, mortgages, financing
statements and assurances as Mortgagee shall require for accomplishing the
express purposes of this Senior Partnership Upstream Note Mortgage.
Mortgagor shall, as provided in Section 5.12, from time to time subject to
the lien of this Senior Partnership Upstream Note Mortgage its right, title and
interest under all Leases.
Mortgagor shall use reasonable efforts to insure that all Operating Assets
(other than Excepted Property) or any interest therein hereafter acquired by
Mortgagor shall be assignable to Mortgagee, and to the extent such assignment to
Mortgagee requires the consent of any governmental authority or any other
Person, Mortgagor shall use reasonable efforts to obtain
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such consent or a waiver thereof.
Mortgagor shall cause this instrument and all other instruments of further
assurance, including all financing statements and continuation statements
covering security interests in personal property, to be promptly recorded,
registered and filed, and at all times to be kept recorded, registered and
filed, and shall execute and file such financing statements and cause to be
issued and filed such continuation statements, all in such manner and in such
places as may be required by law or as requested by Mortgagee to fully preserve
and protect the rights of Mortgagee as a secured party under the Uniform
Commercial Code to all property comprising the Trust Estate (to the extent a
grant of a security interest therein is governed by the Uniform Commercial Code)
and to perfect, preserve and protect the lien of this Senior Partnership
Upstream Note Mortgage as a valid direct first mortgage lien of record and a
valid first priority security interest on the Trust Estate, subject only to
Permitted Encumbrances.
Mortgagor shall pay all filing or recording fees, and all expenses
incident to the execution and delivery of this Mortgage, any financing statement
or continuation statement with respect to the personal property constituting
part of the Trust Estate, and any instrument of further assurance, and all
federal, state, county and municipal stamp taxes and other taxes, duties,
imposts, assessments and charges arising out of or in connection with the
execution and delivery of the Senior Partnership Upstream Note, this Senior
Partnership Upstream Note Mortgage, any financing statement or continuation
statement with respect to the personal property constituting part of the Trust
Estate or any instrument of further assurance.
Mortgagor shall furnish to Mortgagee promptly after the acquisition
hereafter by Mortgagor of any fee interest or leasehold interest in real
property having a fair market value exceeding $500,000 (other than Excepted
Property) (a) a mortgagee policy of title insurance on the most recent form of
American Land Title Association standard loan policy, extended coverage, which
policy shall (i) contain all such endorsements and affirmative insurance, to the
extent reasonably applicable, as is contained in the Original Policy and (ii)
evidence that title to such real property is subject to no liens or encumbrances
(other than Permitted Encumbrances) which would (A) render title unmarketable or
(B) violate any other provision of this Senior Partnership Upstream Note
Mortgage or the TCHI Note Indenture, (b) an as-built survey meeting the "Minimum
Standard Detail Requirements for ALTA/ACSM Land Title Surveys", certified within
60 days prior to the acquisition date by a surveyor licensed in the State of New
Jersey using the same form of certification as that contained in the surveys of
the Premises delivered to the Trustee on the date of this Mortgage and (c) a
Mortgagor's Certificate certifying that the mortgagee policy of title insurance
and survey delivered pursuant to clauses (a) and (b) comply, respectively, with
the provisions of such clauses (a) and (b). Upon delivery of all of the items
required under this paragraph, any liens or encumbrances on such real property
shall constitute Permitted Encumbrances hereunder.
Section 5.7. Payment of Taxes and Certain Claims; Maintenance of Properties;
Compliance with Legal Requirements and Insurance Requirements.
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Mortgagor shall:
(a) subject to the provisions of Section 5.8, pay or cause to be paid
before the date on which any fine, penalty, interest or cost may be added for
nonpayment (but no later than when the same are payable by Mortgagor pursuant to
any Superior Instrument Requirement), all taxes (including, without limitation,
real estate taxes, personal or other property taxes and all sales, value added,
use and similar taxes), assessments (including, without limitation, all
assessments for public improvements or benefits, whether or not commenced or
completed prior to the date hereof and whether or not to be completed prior to
the satisfaction of this Mortgage), water, sewer or other rents, rates and
charges, excises, levies, license fees, permit fees, inspection fees and other
authorization fees and other charges, in each case whether general or special,
ordinary or extraordinary, foreseen or unforeseen, of every character
(including, without limitation, all interest, additions to tax and penalties
thereon), that may be assessed, levied, confirmed or imposed on or in respect of
or be a lien upon (i) the Trust Estate (including, without limitation, the
Leased Land) or any part thereof or any rent therefrom or any estate right or
interest therein, or (ii) any acquisition, occupancy, use, leasing, or
possession of or activity conducted on the real property or any part thereof
included in the Trust Estate or any gross receipts thereof or of the rent
therefrom (all of the foregoing being referred to collectively as
"Impositions"). Notwithstanding the foregoing or any other provision of this
Mortgage, Mortgagor shall not be required to pay any income, profits or revenue
tax upon the income of Mortgagee, the Trustee or the Holders nor any franchise,
excise, corporate, estate, inheritance, succession, capital levy or transfer tax
of Mortgagee, the Trustee or the Holders nor any interest, additions to tax or
penalties in respect thereof, unless such tax is imposed, levied or assessed in
substitution for any Imposition that Mortgagor is required to pay pursuant to
this Section 5.7. Mortgagor shall deliver to Mortgagee, at Mortgagee's request,
official receipts or other proof evidencing payments of any Impositions in
accordance with the requirements of this Section 5.7. Mortgagor shall not be
entitled to any credit for taxes or assessments paid against the Senior
Partnership Upstream Note;
(b) except for such obsolete property as Mortgagor may dispose of or
replace pursuant to Section 2.2, maintain and keep all of Mortgagor's properties
used or useful in the conduct of Mortgagor's business, including, without
limitation, the Casino Hotel and all Tangible Personal Property, in such good
repair, working order and condition, except for reasonable wear and use, and
make or cause to be made all such needful and proper repairs, renewals and
replacements thereto consistent with the standards of first-class casino and
hotel complexes in Atlantic City, New Jersey;
(c) occupy and continuously operate the Casino Hotel and keep the Casino
Hotel supplied with Tangible Personal Property, all in a manner consistent with
the standards of first-class casino and hotel complexes in Atlantic City, New
Jersey;
(d) subject to the provisions of Section 5.8, (i) comply with all Legal
Requirements and Insurance Requirements, whether or not compliance therewith
shall require structural
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changes in the buildings and improvements included in the Trust Estate or
interfere with the use and enjoyment of the Trust Estate or any part thereof,
(ii) procure, maintain and comply with all Permits required for (1) the use of
the Casino as a gaming and gambling facility, (2) the on-premises consumption of
alcoholic beverages at the Casino Hotel and (3) any other use of the Trust
Estate or any part thereof then being made, and for the proper erection,
installation, operation and maintenance of the improvements or any part thereof,
(iii) comply with all obligations of Mortgagor under, and keep in full force and
effect, all easements which in any respect inure to the benefit of, or otherwise
affect, the Trust Estate or any part thereof, if the failure to comply with the
same would impair Mortgagee's security hereunder, and (iv) without limiting the
generality of clause (iii), comply with any instruments of record at the time in
force affecting the Trust Estate or any part thereof, if the failure to comply
with the same would impair Mortgagee's security hereunder. Without limiting the
generality of the foregoing, Mortgagor represents and warrants that at the time
of the execution of this Mortgage, Mortgagor is in compliance with the
requirements of clauses (i), (ii), (iii) and (iv) above; and
(e) in the event of the passage after the date of this Mortgage of any law
of the State of New Jersey, or any other governmental entity, changing in any
way the laws now in force for the taxation of mortgages, or debts secured
thereby, for federal, state or local purposes, or the manner of the operation of
any such taxes, so as to affect the interest of Mortgagee, pay the full amount
of such new or additional taxes.
Section 5.8. Permitted Contests.
Notwithstanding anything in this Senior Partnership Upstream Note Mortgage
to the contrary, Mortgagor, at Mortgagor's expense, may contest (after prior
notice to Mortgagee) by appropriate legal proceedings conducted in good faith
and with due diligence, the amount or validity or application, in whole or in
part, of any Imposition or lien therefor or any Legal Requirement or Insurance
Requirement or the application of any instrument of record (including, without
limitation, any Superior Instrument Requirement) affecting the Trust Estate or
any part thereof or any claims of holders of F,F&E Financing Agreements,
mechanics, materialmen, suppliers, or vendors or lien therefor, and may withhold
payment of the same pending such proceedings if permitted by law, or make
payment under protest, or defer compliance with any such Legal Requirement, any
such Insurance Requirement or the terms of any such instrument, and the same
shall not be a Default hereunder; provided, that (a) in the case of any
Impositions or lien therefor or any claims of mechanics, materialmen, suppliers
or vendors or lien therefor, such proceedings shall suspend the collection
thereof from each of Mortgagor, Mortgagee, the Trustee, the Holders and the
Trust Estate, (b) neither the Trust Estate nor any interest therein would be in
any significant danger of being sold, forfeited, or lost, (c) such action will
not result in the termination of any Facility Lease, (d) in the case of a Legal
Requirement, neither the Holders nor Mortgagee shall be in any significant
danger of any civil liability or any danger of any criminal liability, and the
failure of Mortgagor to comply with such Legal Requirement shall not affect the
continuance in good standing of any
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Permit or result in the suspension, termination, non-renewal or material adverse
modification of any Permit, and (e) in the case of an Insurance Requirement, the
failure of Mortgagor to comply therewith shall not affect the validity of any
insurance required to be maintained by Mortgagor hereunder.
Section 5.9. Mechanics' and Other Liens.
Mortgagor shall cause to be removed, either by payment, or bonding or
otherwise, all claims and demands of mechanics, materialmen, laborers, and
others which, if unpaid, might result in, or permit the creation of, a lien on
the Premises and/or Trust Estate or any part thereof, or on the revenues, rents,
issues, income and profits arising therefrom and in general shall do or cause to
be done everything necessary so that the lien hereof shall be fully preserved,
at the cost of Mortgagor, without expense to Mortgagee.
Section 5.10. To Insure.
(a) Mortgagor, at Mortgagor's expense, shall maintain with Insurers:
(i) insurance with respect to Mortgagor's insurable properties
constituting a part of the Trust Estate against loss or damage by fire,
lightning, and other risks from time to time included under "all-risk"
policies and against loss or damage by sprinkler leakage, water damage,
collapse, malicious mischief and explosion in respect of any steam and
pressure boilers and similar apparatus located on such insurable
properties, in amounts at all times sufficient to prevent Mortgagor from
becoming a coinsurer within the terms of the applicable policies, but in
any event such insurance shall be maintained in not less than the greatest
of the following (the "Insurance Amount"): (A) 100% of the then Full
Insurable Value of such insurable properties, determined from time to time
(but not less frequently than once in any 36 calendar months), by an
Appraiser or Insurer, (B) the then Outstanding Amount of Mortgage Debt,
including the Senior Partnership Upstream Note, or (C) the amount required
to be maintained pursuant to the Superior Instrument Requirements;
(ii) war risk insurance as and when such insurance is obtainable
from the United States of America or any agency thereof as promptly as
reasonably practicable after the same becomes so obtainable, in an amount
not less than the Insurance Amount, or, if such insurance cannot be
obtained in an amount not less than the Insurance Amount, in such lesser
amount as may then be so obtainable;
(iii) comprehensive general liability insurance, including, without
limitation, blanket contractual liability coverage, broad form property
damage, independent contractor's coverage and personal injury coverage
against any and all claims arising out of or connected with the
possession, use, leasing, operation or condition of such insurable
properties, in an amount not less than $100,000,000 combined single limit
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coverage for personal injury and property damage with respect to any one
occurrence, which may be under an umbrella policy. Anything contained in
this clause (iii) to the contrary notwithstanding, the Superior Instrument
Requirements with respect to the kinds and amount of insurance described
in this clause (iii) shall be satisfied by Mortgagor;
(iv) workers' compensation insurance to the extent required by law;
(v) business interruption insurance covering not less than 6 months
of loss, provided that, at any time that Mortgagor is renewing any policy
for such insurance or taking out any new or replacement policy for such
insurance covering a period of less than 12 months, Mortgagor shall
deliver to Mortgagee an Officers' Certificate certifying that the period
of coverage to be maintained by Mortgagor under such policy is the maximum
that can be maintained at rates determined by Mortgagor to be reasonable
for such coverage;
(vi) to the extent available, flood insurance in an amount not less
than the Insurance Amount, or, if such insurance cannot be obtained in an
amount not less than the Insurance Amount, such lesser amount as may then
be so obtainable but in no event less than $100,000,000; and
(vii) such other insurance with respect to such insurable properties
against loss or damage of the kinds (A) from time to time customarily
insured against by persons owning or using first-class casino and hotel
complexes in Atlantic City, New Jersey and (B) required to be maintained
pursuant to any Superior Instrument Requirements.
Notwithstanding the foregoing, to the extent not violative of any Superior
Instrument Requirements, (A) Mortgagor may maintain a deductible with respect to
the insurance policies described in clauses (i), (ii), (vi) and (vii) in an
amount not to exceed $250,000, (B) Mortgagor may maintain a deductible with
respect to the insurance policies described in clause (iii) in an amount not to
exceed $500,000, and (C) Mortgagor may maintain a deductible with respect to the
insurance policies described in clause (v) in an amount not to exceed
$1,000,000.
(b) (i) Each policy of insurance maintained by Mortgagor pursuant to
Section 5.10(a) shall, (A) except in the case of workers' compensation
insurance, name Mortgagor as an insured and shall name as additional insureds
(1) Mortgagee and (2) to the extent required by the Superior Instrument
Requirements, the lessors under any Facility Leases, (B) provide that all
insurance proceeds for losses, except in the case of comprehensive general
liability insurance and workers' compensation insurance or as otherwise provided
in Subsections (d), (e) and (f) of this Section 5.10, be payable solely to
Mortgagee, (C) include effective waivers (whether under the terms of any such
policy or otherwise) by the insurer of all claims for insurance premiums against
all loss payees and named insureds (other than Mortgagor) and all rights of
subrogation against any named insured, (D) except in the case of comprehensive
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general liability and workers' compensation insurance, provide that any losses
shall be payable notwithstanding (1) any act, failure to act, negligence of, or
violation or breach of warranties, declarations or conditions contained in such
policy by Mortgagor or Mortgagee or any other named insured or loss payee
(including, without limitation, the lessors under the Facility Leases, with
respect to any Leased Facilities, (2) the occupation or use of the insurable
properties for purposes more hazardous than permitted by the terms of the
policy, (3) any foreclosure or other proceeding or notice of sale relating to
the insurable properties or (4) any change in the title to or ownership or
possession of the insurable properties, (E) contain a non-contributory mortgagee
clause in favor of Mortgagee, and (F) provide that if all or any part of such
policy is canceled, terminated or expires, the insurer will forthwith give
notice thereof to each named insured and loss payee and that no cancellation,
non-renewal, reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by each named insured and loss
payee of written notice thereof.
(ii) Mortgagor may effect the insurance required under this Section 5.10
under blanket and/or umbrella policies covering properties owned or leased by
Affiliates of Mortgagor; provided, that (A) such policies otherwise comply with
this mortgage, (B) except with respect to flood insurance and earthquake
insurance, provide that the amount of coverage afforded thereunder with respect
to the Trust Estate shall not be reduced by claims thereunder against such other
properties and (C) in the case of flood insurance provide that the amount of
coverage afforded thereunder with respect to the Trust Estate shall not be
reduced below $100,000,000 by reason of claims thereunder against such other
properties.
(c) Mortgagor shall deliver to Mortgagee duplicate originals of all
insurance policies that Mortgagor is required to maintain pursuant to this
Section 5.10. Mortgagee shall not be responsible for effecting or renewing any
insurance or for the responsibility or solvency of the insurers.
(d) Mortgagor shall give written notice to Mortgagee immediately upon
obtaining knowledge of any Casualty which (i) results in damage, loss or
destruction in an amount in excess of $5,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property or (ii)
pursuant to any Superior Instrument Requirement would require the deposit of
insurance proceeds with the Insurance Trustee, or action or proceeding with
respect thereto. Within 30 days after any Casualty which results in any damage,
loss or destruction in an amount in excess of $10,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property, Mortgagor
shall deliver to Mortgagee a certificate of an Architect stating whether, in
such Architect's opinion, applicable Legal Requirements permit the Restoration
of said buildings and improvements for the same uses and to the same size and
quality in all material respects, as existed immediately prior to the Casualty
(and if said certificate states that Legal Requirements do not permit such
Restoration, said certificate shall describe the manner closest approximating
such criteria to which the buildings and improvements could be so restored and
shall be accompanied by a Certificate Of Appraised Value dated not more than 10
days prior to delivery setting forth the Appraised Value
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immediately prior to the Casualty and the estimated Appraised Value immediately
after the Restoration). If Mortgagor is required to deliver such Certificates of
Appraised Value and if based on such Certificates of Appraised Value immediately
after Restoration, (i) the aggregate Outstanding Amount of the Indebtedness of
the Mortgagor, the Company or TCHI immediately after such Restoration shall
exceed the greater of (A) 80% of the Appraised Value immediately after such
Restoration or (B) the quotient of the Outstanding Amount of the Indebtedness of
the Mortgagor, the Company or TCHI immediately prior to such Casualty divided by
the Appraised Value immediately prior to the Casualty multiplied by the
Appraised Value immediately after such Restoration, or (ii) applicable Legal
Requirements do not permit the Restoration of the Casino Hotel for use as a
casino and hotel complex, then, in either of such events, the proceeds of any
insurance shall not be applied to Restoration but shall instead be paid and
delivered to Mortgagee to the extent of the then Outstanding Amount of the
Senior Partnership Upstream Note and any other interest or other sums due
hereunder or thereunder to be applied to the satisfaction of this Mortgage to
the extent proceeds are available for such purpose and provided that no
additional sums are due to the Trustee or the Holders under the Senior Notes,
the Senior Note Indenture, the Senior Guarantee, the TCHI Notes, the TCHI Note
Indenture, the TCHI Guarantee, the Mortgage Notes or the Mortgage Note
Indenture, the balance of any net insurance proceeds shall be paid to Mortgagor.
(e) Subject to the provisions of Subsection 5.10(d), if a Casualty occurs,
the following shall apply:
(i) If the cost of Restoration is less than $10,000,000, the net
insurance proceeds shall be paid by Mortgagee to Mortgagor.
(ii) If the cost of Restoration is $10,000,000 or more, the net
insurance proceeds shall be paid by Mortgagee to the Insurance Trustee.
(iii) Mortgagor shall commence with reasonable promptness under the
circumstances and thereafter with due diligence proceed to perform and
complete in a good and workmanlike manner the restoration, repair,
replacement or rebuilding of the damage or destruction resulting from the
Casualty (all such restoration, repair, replacement and rebuilding
following a Casualty or a Taking are referred to as "Restoration") in
accordance with the plans and specifications submitted to the Insurance
Trustee, in conformance with all Legal Requirements and Superior
Instrument Requirements, and in accordance with the further provisions of
this Subsection (e), regardless of the extent of any such Casualty and
whether or not net insurance proceeds, if any, shall be available or, if
available, shall be sufficient, for the purpose of the Restoration. All
Restoration work shall be performed in accordance with the applicable
provisions of Section 5.12 and in conformance with all Superior Instrument
Requirements, Legal Requirements and Insurance Requirements and, prior to
commencing any Restoration, Mortgagor shall obtain all Permits necessary
in connection therewith, and shall obtain, and keep in full force and
effect until the
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completion of such Restoration, such additional insurance as the Insurance
Trustee and Superior Instrument Requirements may require. The plans and
specifications for the Restoration shall be accompanied by a Mortgagor's
Certificate and an Opinion of Counsel to the effect that upon the
completion of the Restoration pursuant to the plans and specifications,
the Premises and all buildings and improvements thereon will comply with
all Superior Instrument Requirements, Legal Requirements and Insurance
Requirements.
(iv) Any insurance proceeds which Mortgagor receives shall be held
by Mortgagor in trust for the purpose of paying the cost of the
Restoration, except as otherwise provided herein.
(v) Any net insurance proceeds that the Insurance Trustee holds
pursuant to this Subsection (e), shall be deposited in an interest-bearing
investment reasonably designated by Mortgagor (to the extent Mortgagor is
permitted to designate such investment under the Superior Instrument
Requirements) (and the interest thereon shall be added to such proceeds)
and shall be paid by the Insurance Trustee to reimburse Mortgagor for, or
to make payment for, the Restoration, after the Insurance Trustee deducts
therefrom the amount of any reasonable costs and expenses incurred in
connection with the performance of its obligations under this Section
5.10. The Insurance Trustee shall make such payments not more frequently
than once every 30 days upon the written request of Mortgagor (unless more
frequent payments are required by Superior Instrument Requirements), by
paying to Mortgagor or the persons named in the certificate described in
clause (vi) of this Subsection (e) the respective amounts stated in such
certificate from time to time as the Restoration progresses, provided
Mortgagor has complied with the requirements of this Subsection (e) and
such payment is permitted by any applicable Superior Instrument
Requirements. Mortgagor's request shall be accompanied by (A) the
certificate described in clause (vi) of this Subsection (e) and (B) a
title company or official search, or other evidence reasonably acceptable
to the Insurance Trustee, showing that there have not been filed with
respect to the Premises, any vendor's, contractor's, mechanic's, laborer's
or materialman's statutory or similar lien which has not been discharged
of record (or bonded against or secured by other security) or any other
encumbrance irrespective of its priority (other than Permitted
Encumbrances).
(vi) The certificate required by clause (v) of this Subsection (e)
shall (A) be a Mortgagor's Certificate, countersigned by the Architect in
charge of the Restoration with respect to the matters described in (1) and
(5) below, (B) be dated not more than 10 days prior to such request and
(C) set forth (in addition to any other requirements contained in any
applicable Superior Instrument Requirements) that:
(1) all of the Restoration theretofore performed is in
substantial compliance with the plans and specifications theretofore
submitted to the
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Insurance Trustee and in compliance with all Superior Instrument
Requirements, Legal Requirements and Insurance Requirements;
(2) the sum then requested either has been paid by Mortgagor
or is justly due to contractors, subcontractors, materialmen,
engineers, architects or other persons who have rendered services or
furnished or contracted to deliver materials for the Restoration
therein specified, and the names and addresses of such persons, a
brief description of such services and materials and the several
amounts so paid or due to each of said persons in respect thereof;
(3) no part of the amount requested has been or is the basis
in any previous or then pending request for the withdrawal of net
insurance proceeds, and that the sum then requested does not exceed
the value of the services and materials described in the
certificate;
(4) except for the amount, if any, stated pursuant to
subclause (2) of this clause (vi) in such certificate to be due for
services or materials, and except for amounts in dispute and/or
customary retainages, there is no outstanding indebtedness known to
the person signing such certificate, after due inquiry, which is
then due for labor, wages, materials, supplies or services in
connection with such Restoration; and
(5) the remaining cost, as estimated by the persons signing
such certificate, of the Restoration in order to complete the same
does not exceed the net insurance proceeds remaining in the hands of
Insurance Trustee after payment of the sum requested in such
certificate or if such estimated cost does exceed such insurance
proceeds such certificate shall state the amount of any such
deficiency. If the certificate states that such deficiency will
exist, Mortgagor shall deliver the amount of such deficiency in cash
or cash equivalent to the Insurance Trustee simultaneously with the
delivery of such certificate, which amount shall be deemed insurance
proceeds for purposes of this Section 5.10(e).
(vii) If net insurance proceeds shall be insufficient to pay the
entire cost of the Restoration, then, after completion of the Restoration,
Mortgagor shall pay the deficiency. If all or any part of the net
insurance proceeds are not used for the Restoration in accordance with
this Subsection (e) (because such proceeds exceed the amount required to
complete the Restoration), then upon completion of the Restoration in
accordance with this Subsection (e), such amount not so used, if held by
the Insurance Trustee, shall be paid to Mortgagor (if permitted by
Superior Instrument Requirements).
(f) Mortgagor shall not take out separate insurance, concurrent in form or
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contributing in the event of loss with that required to be maintained pursuant
to this Section 5.10, unless the same is permitted by Superior Instrument
Requirements. Mortgagor shall immediately notify Mortgagee whenever any such
separate insurance is taken out and shall promptly deliver to Mortgagee a
duplicate original of the policy of such insurance, a copy thereof certified by
the insurer or a certificate thereof. Provided that no Event of Default has
occurred and is continuing, all net business interruption insurance proceeds
shall be paid to Mortgagor, to be segregated from the other funds of Mortgagor
and held in trust by Mortgagor for the following purposes and in the following
order of priority: (i) for the payment of Impositions and amounts due under the
Facility Leases, (ii) for debt service under the Senior Partnership Upstream
Note for the estimated period of Restoration (for purposes of this Subsection
5.10(f), interest and principal payments due on any payment date under the
Senior Partnership Upstream Note will be deemed to accrue in equal daily
installments beginning the day after the immediately preceding payment date and
ending on such payment date), and (iii) for any other expense incurred in
connection with the operation or business of the Casino Hotel.
(g) Insurance claims by reason of damage or destruction to any portion of
the Trust Estate may be adjusted by Mortgagor, but Mortgagee shall have the
right (but not the obligation) to join Mortgagor in adjusting, and approving the
adjustment of, any such loss except in the event of a loss where the amount of
insurance reasonably anticipated to be received with respect to such loss is
less than $5,000,000, and Mortgagor shall assist Mortgagee in any such
adjustment at the request of Mortgagee. If Mortgagee at its election as
aforesaid joins Mortgagor in any adjustment process, then Mortgagee's approval
of the adjustment shall not be unreasonably withheld.
(h) Notwithstanding anything contained herein to the contrary, if an Event
of Default shall have occurred and be continuing, Mortgagee may, at its option,
(A) refrain from paying to Mortgagor or the Insurance Trustee any net insurance
proceeds or (B) instruct the Insurance Trustee to pay to Mortgagee any insurance
proceeds then held by the Insurance Trustee, as the case may be.
Section 5.11. Limitations on Building Demolition, Alterations, Improvements and
New Construction.
Mortgagor shall not authorize, permit or make any demolition, alteration
or improvement of any building, structure or other improvements included in the
Trust Estate or any new construction on any part of the Trust Estate, except in
conformity with and subject to the limitations hereinafter in this Section 5.11
set forth and set forth in the TCHI Note Indenture.
Unless an Event of Default shall have occurred and be continuing,
Mortgagor shall have the right at all times to make or permit such demolition,
alterations, improvements or new construction, structural or otherwise (herein
sometimes called collectively "Alterations" and
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each, individually, an "Alteration"), of the Trust Estate, to be made in all
cases subject to each of the following conditions:
(a) No Alteration shall be undertaken or carried out except in conformity
with all Superior Instrument Requirements, Legal Requirements and Insurance
Requirements.
(b) If the estimated cost of any Alteration, together with other
Alterations that constitute a single construction plan or project (whether or
not accomplished in several stages or procedures), exceeds $5,000,000, the
building or buildings, structures or other improvements as so improved or
altered, upon the completion of the work, shall be of a value not less than the
value of such building or buildings, structures or other improvements
immediately prior to the making of such Alteration.
(c) Any Alteration which is structural in nature or involves an estimated
cost of more than $5,000,000 shall be conducted under the supervision of an
Architect, and no such Alteration shall be undertaken until 10 days after there
shall have been filed with Mortgagee detailed plans and specifications and cost
estimates therefor, prepared and approved in writing by such Architect and
accompanied by a certificate of such Architect stating that such plans and
specifications conform to all applicable provisions of this Section 5.11.
(d) No Alteration involving an estimated cost of more than $5,000,000
shall be undertaken until Mortgagor has furnished to Mortgagee, at Mortgagor's
sole cost and expense, a surety bond or bonds, covering performance, and labor
and material payments with respect to the work to be so performed, naming
Mortgagee as obligee, issued by a responsible surety company, authorized to do
business in the State of New Jersey, in a form generally and customarily used by
such surety in an amount equal to the estimated cost of construction of the work
covered by the plans and specifications therefor, guaranteeing the performance
and completion of such construction, substantially in conformity with the said
plans and specifications and within a reasonable time, subject to delays by
fire, strikes, lock-out, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable Casualty
or other similar causes beyond the control of Mortgagor, free and clear of all
liens, claims and liabilities for the cost of such Alterations. If such surety
bond or bonds shall be unobtainable Mortgagor shall deliver to Mortgagee
security by cash, letter of credit or other guarantee, affording substantially
the same protection as would such bond or bonds.
(e) All work done in connection with any Alterations shall be done
promptly and in good and workmanlike manner. The work in connection with any
Alteration shall be prosecuted with reasonable dispatch, delays due to fire,
strikes, lock-outs, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable Casualty
or similar causes beyond the control of Mortgagor excepted.
(f) If the estimated cost of Alterations exceeds $5,000,000, Mortgagor
shall have
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delivered to Mortgagee (i) prior to the commencement of such Alterations, copies
of all Permits required for the commencement of such work together with a
certificate of the Architect or an Opinion of Counsel to the effect that all
Permits required for the commencement of such Alterations have been obtained;
and (ii) within a reasonable period of time after the completion of the
Alterations, copies of all Permits required in connection with the completion
thereof, together with either an Opinion of Counsel or a certificate of the
Architect that all such Permits have been so obtained by Mortgagor and that
Mortgagor has complied with all the requirements of this Section 5.11.
(g) No Alterations of any kind shall be made which shall change the use or
reduce the size or quality of any building, structure or other improvements in
any material respect or which shall change the use of the Casino Hotel from its
use as a gaming and hotel facility.
(h) No Alterations costing in excess of $5,000,000, together with other
Alterations that constitute a single construction plan or project (whether or
not accomplished in several stages or procedures), shall be made if such
Alterations are not expected to be completed at least 120 days prior to the
Stated Maturity of the Senior Partnership Upstream Note (except if such
Alterations are required in order to comply with Legal Requirements or Superior
Instrument Requirements).
(i) Mortgagor shall maintain at all times during the performance of
Alterations, in addition to any insurance required to be maintained under
Section 5.11 hereof, appropriate workers' compensation insurance covering all
persons employed for such Alterations to the extent required by applicable law,
and comprehensive general liability insurance expressly covering the additional
hazards due to such Alterations. Each such policy of insurance shall comply with
the provisions of Section 5.10(b), and Mortgagor shall comply with Subsections
(c), (d), (e), (f), (g) and (h) of Section 5.10 in connection with all such
insurance.
Section 5.12. Leases.
Mortgagor shall not:
(a) lease the Trust Estate substantially as an entirety to any Person
(except in accordance with the provisions of Article Eight of the TCHI Note
Indenture), nor shall Mortgagor lease either the Casino Hotel or the Casino or
the Hotel or any parking facilities substantially as an entirety to any Person;
(b) enter into any Lease, or renew, modify, extend, terminate, or amend
any Lease, except in the ordinary course of business of operating the Casino
Hotel;
(c) receive or collect, or permit the receipt or collection of, any rental
payments under any Lease more than one month in advance of the respective
periods in respect of which they are to accrue, except that, in connection with
the execution and delivery of any Lease or
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of any amendment to any Lease, rental payments thereunder may be collected and
received in advance in an amount not in excess of three months' rent and/or a
security deposit may be required thereunder in an amount not exceeding one
year's rent;
(d) collaterally assign, transfer or hypothecate (other than to Mortgagee
hereunder or to the holder of the Senior Note Mortgage, the holder of the Senior
Guarantee Mortgage, or the holder of the TCHI Note Guarantee Mortgage, but in
each case only with respect to the property secured by such mortgage) (i) any
rental payment under any Lease whether then due or to accrue in the future, (ii)
the interest of Mortgagor as landlord under any Lease or (iii) the rents, issues
or profits of the Trust Estate;
(e) after the date hereof, enter into any Lease, or renew any Lease,
unless such Lease contains terms to the effect as follows:
(i) the Lease and the rights of the tenants thereunder shall be
subject and subordinate to the rights of Mortgagee under this Mortgage,
(ii) the Lease may be assigned by the landlord thereunder to
Mortgagee, and
(iii) the rights and remedies of the tenant in respect of any
obligations of the landlord thereunder shall be nonrecourse as to any
assets of the landlord other than its equity in the building in which the
leased premises are located or the proceeds thereof; or
(f) modify any Lease with respect to the matters described in clauses (i)
through (iii) of paragraph (e).
If Mortgagor enters into a Lease (other than with an Affiliate of
Mortgagor) for a term of not less than 3 years, Mortgagee shall deliver a
non-disturbance and attornment agreement substantially in the form of Schedule 7
hereto, following receipt of a certificate of a leasing broker (who is not an
Affiliate of Mortgagor or the broker involved in such transaction) experienced
with respect to leases of commercial space in the Atlantic City area stating
that the rent under the Lease throughout the term thereof is not less than fair
market rent and the other terms of the Lease are fair and reasonable in the
commercial leasing market. Mortgagor shall, upon demand, reimburse Mortgagee for
any costs and expenses (including reasonable attorneys' fees and disbursements)
incurred by Mortgagee in connection with the preparation, review and delivery of
such non-disturbance and attornment agreements.
Promptly after the execution and delivery hereof, and promptly after each
Lease is executed or becomes effective after the date of the execution and
delivery hereof, Mortgagor shall cause the lessee under each such Lease to be
duly notified in writing (unless the substance and effect of such notice shall
be contained in such Lease) of the subjection of the owner's interest, as
lessor, in and to such Lease to the lien of this Mortgage and of the name and
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address of Mortgagee. Each such notice shall state that the lease of such lessee
is a Lease as herein defined. If a new Mortgagee is at any time appointed
hereunder or the address of Mortgagee shall at any time be changed, Mortgagor
shall cause each lessee under each Lease to be promptly notified in writing of
the name and address of such new Mortgagee or the new address of Mortgagee.
Mortgagor shall use reasonable efforts (but shall not be obligated to incur any
expenditure other than de minimis amounts) to obtain from each lessee under each
Lease to whom any notice is sent pursuant to this paragraph an acknowledgment of
receipt of such notice, and Mortgagor shall promptly deliver to Mortgagee,, upon
request, a copy of each such acknowledgment of receipt which it is able to
obtain. Mortgagee shall not be responsible for securing or causing Mortgagor to
secure any such acknowledgment.
Section 5.13. Compliance Certificates.
Mortgagor shall deliver to Mortgagee, within 120 days after the end of
each fiscal year of Mortgagor, a Mortgagor's Certificate stating that
(a) a review of the activities of Mortgagor during such year and of
performance under this Mortgage has been made under the signer's supervision,
and
(b) to the best of each signer's knowledge, based on such review,
Mortgagor has fulfilled all of Mortgagor's obligations under this Mortgage
throughout such year, or, if there has been a default in the fulfillment of any
such obligation, specifying each such default known to him and the nature and
status thereof.
Promptly after Mortgagor may reasonably be deemed to have knowledge of a
default hereunder, Mortgagor shall deliver to Mortgagee a notice specifying the
nature and period of existence thereof and the action Mortgagor is taking and
proposes to take with respect thereto.
Section 5.14. To Keep Books; Inspection by Mortgagee.
Mortgagor will keep proper books of record and account, in which full and
correct entries shall be made of all dealings or transactions of or in relation
to the Senior Partnership Upstream Note and the properties, business and affairs
of Mortgagor in accordance with generally accepted accounting principles
consistently applied. Said books shall be maintained in an office located either
in Atlantic City, New Jersey or in the Borough of Manhattan, City of New York,
State of New York. Mortgagor shall at any and all times, upon request of
Mortgagee and at the expense of Mortgagor, permit Mortgagee and its
representatives to inspect the Casino Hotel and any other buildings, structures
and improvements now or hereafter located on the Land and the books of account,
records, reports and other papers of Mortgagor, and to make copies and extracts
therefrom, and will afford and procure a reasonable opportunity to make any such
inspection (provided, that any such inspection shall not unreasonably interfere
with the business operations of Mortgagor), and Mortgagor will furnish to
Mortgagee any and all information as Mortgagee may reasonably request, with
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respect to the performance by Mortgagor of its covenants in this Mortgage.
Section 5.15. Advances by Mortgagee.
If Mortgagor shall fail to perform any of the covenants, terms, provisions
or conditions contained in this Mortgage and such failure shall continue for 10
days following notice thereof given by Mortgagee (or at any time, without
notice, in case of emergency), Mortgagee may (but is not obligated to), at any
time and from time to time, take any action or make advances, to effect
performance of any such covenant, term, provision or condition on behalf of
Mortgagor; and all moneys so used, paid or advanced by Mortgagee and all
reasonable costs and expenses incurred by Mortgagee in connection therewith,
together with interest on all of the same at the rate of interest set forth in
the Senior Partnership Upstream Note, shall be immediately due and payable by
Mortgagor to Mortgagee and all such moneys, costs and expenses shall be secured
by the lien of this Mortgage prior to the Senior Partnership Upstream Note. No
such advance or payment by Mortgagee shall relieve Mortgagor from any default
hereunder or impair any right or remedy of Mortgagee.
Section 5.16. Waiver of Stay, Extension or Usury Laws.
Mortgagor covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any usury, stay or extension law or any other
law which would prohibit or forgive Mortgagor from paying all or any portion of
the obligations secured by this Mortgage, wherever enacted, now or at any time
hereafter in force, or which may otherwise affect the covenants or the
performance of this Mortgage; and Mortgagor (to the extent that it may lawfully
do so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it shall not hinder, delay or impede the execution of any power
herein granted to Mortgagee, but shall suffer and permit the execution of every
such power as though no such law had been enacted.
Section 5.17. Eminent Domain.
(a) Mortgagor shall notify Mortgagee immediately upon obtaining knowledge
of any Taking affecting the Trust Estate or any part thereof. If the Taking is a
Taking of less than the whole or substantially all of the Premises but (i) is
estimated to result in an award of more than $10,000,000 or (ii) the Taking will
interfere with or adversely affect the operation of the Casino Hotel (other than
any portion thereof consisting solely of unimproved, paved or unpaved surface
parking) other than to a de minimis extent, then within 30 days after such
Taking, Mortgagor shall deliver to Mortgagee a certificate of an Architect
stating whether, in such Architect's opinion, applicable Legal Requirements
permit the Restoration of any buildings and improvements for the same uses and
to the same size and quality in all material respects as existed immediately
prior to the Taking (and if said certificate states that Legal Requirements do
not permit such Restoration, said certificate shall describe the manner closest
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approximating such criteria to which the buildings and improvements could be so
restored and shall be accompanied by a Certificate of Appraised Value dated not
more than 10 days prior to delivery setting forth the Appraised Value
immediately prior to the Taking and the estimated Appraised Value immediately
after the permitted Restoration). If Mortgagor is required to deliver such
Certificate of Appraised value and if based on such Certificate of Appraised
Value immediately after Restoration, (i) the Outstanding Amount of the
Indebtedness of the Mortgagor, the Company or TCHI immediately after such
Restoration shall exceed the greater of (A) 80% of the Appraised Value
immediately after such Restoration or (B) the quotient of the Outstanding Amount
of Indebtedness of the Mortgagor, the Company or TCHI Indebtedness immediately
prior to such Taking divided by the Appraised Value immediately prior to the
Taking multiplied by the Appraised Value immediately after such Restoration, or
(ii) applicable Legal Requirements do not permit the Restoration of the Casino
Hotel for use as a casino and hotel complex, then, in any of such events, the
Taking shall be deemed a Taking of "the whole or substantially all of the
Premises." The Taking shall be deemed a Taking of "less than the whole or
substantially all of the Premises" if Mortgagor is not required to deliver a
Certificate Of Appraised Value or if, at the time of delivery of such
Certificate, neither of the tests set forth in clauses (i) and (ii) is met.
(b) If at any time there shall occur a Taking of less than the whole or
substantially all of the Premises and the award or awards resulting therefrom
payable to Mortgagor (and not to any lessor under any Facility Lease) (after
there shall have been first deducted the fees and expenses incurred in
connection with the termination, settlement and collection of such award or
awards, including, without limitation, reasonable counsel fees and expenses,
hereinafter referred to as "Settlement Costs") (i) shall be less than
$10,000,000 (except to the extent that the Insurance Trustee is required to hold
such amount pursuant to a Superior Instrument Requirement), the entire amount of
such award shall be paid to Mortgagor; and (ii) if such award is $10,000,000 or
more, the entire amount of such award shall be paid to the Insurance Trustee. In
either event, such awards shall be applied to the cost of Restoration of the
Trust Estate as nearly as practicable to their uses, value and condition
immediately prior to the Taking (except to the extent otherwise provided by
Superior Instrument Requirements). Mortgagor shall promptly commence and with
due diligence perform the Restoration in accordance with clauses (iii), (iv) and
(vii) of Subsection 5.10(e) (after substituting the words "Taking" for
"Casualty" and "award" for "net insurance proceeds"), at no cost to Mortgagee.
All claims or suits arising out of any Taking may be settled by Mortgagor,
except that Mortgagee shall have the right (but not the obligation) to
participate in such claim or suit, and to approve settlement thereof (and
notwithstanding anything in the Facility Leases to the contrary, Mortgagor shall
not agree to any settlement or compromise of the amount of any such claim or
suit, except a claim or suit where the amount reasonably anticipated to be
received by Mortgagor is less than $5,000,000). If Mortgagee at its election as
aforesaid joins such claim or suit, Mortgagee's approval of such settlement
shall not be unreasonably withheld. The Insurance Trustee shall promptly pay
such sums as are received by it from such Taking from time to time in accordance
with the procedures set forth in clauses (v) and (vi) of Subsection 5.10(e)
(after substituting the words "Taking" for "Casualty" and "award" for "net
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insurance proceeds").
(c) If at any time there shall occur a Taking of the whole or
substantially all of the Premises, then the award payable to Mortgagor shall not
be applied to Restoration but shall instead be paid and delivered to the Trustee
(subject to the rights of the lessors under any Facility Leases) to the extent
of the then Outstanding Amount of the Senior Partnership Upstream Note and any
other interest or other sums due hereunder or thereunder to be applied to the
satisfaction of this Mortgage to the extent proceeds are available for such
purpose and provided that no additional sums are due to the trustee or the
holders under the Senior Notes, the Senior Note Indenture, the Senior Guarantee,
the TCHI Notes, the TCHI Note Indenture, the TCHI Guarantee, the Mortgage Notes
or the Mortgage Note Indenture, the balance of any award shall be paid to
Mortgagor.
(d) Notwithstanding anything contained herein to the contrary, if an Event
of Default shall have occurred and is continuing, Mortgagee may, at its option,
(i) refrain from paying to Mortgagor or the Insurance Trustee any award or (ii)
instruct the Insurance Trustee to pay to Mortgagee any award then held by the
Insurance Trustee, as the case may be.
Section 5.18. Facility Leases.
(a) Mortgagor shall do or cause to be done all things necessary to
preserve and keep unimpaired the rights of Mortgagor, as lessee under all
Facility Leases, and, to prevent any termination, surrender, cancellation,
forfeiture or impairment of any thereof. Mortgagor shall at all times fully
perform and comply with all agreements, covenants, terms and conditions imposed
upon or assumed by it as lessee under each of the Facility Leases (including,
without limitation, the covenant to pay rent and all taxes, assessments and
other charges mentioned therein) prior to the expiration of any notice and/or
cure period provided in each such Facility Lease. Upon receipt by Mortgagee from
a Lessor of any written notice of default by the lessee thereunder, Mortgagee
may rely thereon and take any action Mortgagee deems necessary in its sole
discretion to prevent or to cure any default by Mortgagor in the performance of
or compliance with any of the agreements, covenants, terms or conditions imposed
upon or assumed by Mortgagor as lessee under such Facility Lease, even though
the existence of such default or the nature thereof be questioned or denied by
Mortgagor or by any party on behalf of Mortgagor. Without limiting the
generality of Section 3.9, Mortgagor hereby expressly grants to Mortgagee, and
agrees that Mortgagee shall have, the absolute and immediate right to enter in
and upon the Premises or any part thereof to such extent and as often as
Mortgagee, in its sole discretion, deems necessary or desirable for the purpose
permitted by the immediately preceding sentence, subject only to applicable
Legal Requirements. Without limiting Mortgagor's obligations or Mortgagee's
rights set forth above or limiting Mortgagee's other remedies under this
Mortgage, Mortgagee may pay and expend such sums of money as Mortgagee in its
sole discretion deems necessary for any such purpose, and Mortgagor hereby
agrees to pay to Mortgagee immediately and without demand, all such sums
referred to above, so paid and expended by Mortgagee, together with interest
thereon from the date of each such
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payment at the highest rate of interest set forth in the Senior Partnership
Upstream Note. All sums so paid and expended by Mortgagee, and the interest
thereon, shall be added to and be secured by the lien of this Mortgage.
(b) Mortgagor further covenants and agrees as follows:
(i) Mortgagor shall not surrender, terminate or cancel any Facility
Lease, and shall not without the consent of Mortgagee modify, change,
supplement, alter or amend any Facility Lease either orally or in writing
if an impairment of the security granted under this Mortgage would result
therefrom. As further security for the repayment of the indebtedness
secured hereby and for the performance of the covenants herein and in each
Facility Lease contained, Mortgagor hereby assigns to Mortgagee all of
Mortgagor's rights, privileges and prerogatives as lessee under each
Facility Lease to terminate, cancel, modify, change, supplement, alter or
amend such Facility Lease and any such termination, cancellation,
modification, change, supplement, alteration or amendment of a Facility
Lease without the prior consent thereto by Mortgagee shall be void and of
no force and effect. Unless (1) an Event of Default has occurred and is
continuing and (2) either (A) there has been an acceleration of maturity
of the Senior Partnership Upstream Note pursuant to Section 3.2 or (B)
Mortgagee exercises its rights under Section 3.9, Mortgagee shall have no
right to terminate, cancel, modify, change, supplement, alter or amend any
Facility Lease.
(ii) Solely for the benefit of Mortgagee, Trustee, the Holders and
no other person, no release or forbearance of any of Mortgagor's
obligations under any Facility Lease, pursuant to such Facility Lease or
otherwise, shall release Mortgagor from any of Mortgagor's other
obligations under this Mortgage.
(iii) Unless Mortgagee shall otherwise expressly consent in writing,
the fee title to the Leased Facilities and Mortgagor's leasehold estates
therein shall not merge and shall always remain separate and distinct,
notwithstanding the union of said estates either in the Lessor or in the
lessee, or in a third party by purchase or otherwise
(iv) Mortgagor shall promptly notify Mortgagee in writing of any
request made by Mortgagor, as lessee under any Facility Lease, or any of
the Lessors, for arbitration proceedings under any Facility Lease and of
the institution of any arbitration proceedings, as well as all proceedings
thereunder. Mortgagor shall promptly deliver to Mortgagee a copy of the
determination of the arbitrators in each such arbitration proceeding.
Mortgagee shall have the right to participate in such arbitration
proceedings in association with Mortgagor or on its own behalf as an
interested party.
(v) Mortgagor shall not consent to the subordination of any Facility
Lease to any mortgage, deed of trust or other lien on the fee interest of
the Lessor.
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(vi) If Mortgagor acquires fee simple title or any other estate,
title or interest in any Leased Facility, Mortgagor shall promptly notify
Mortgagee of such acquisition and, on request by Mortgagee, shall cause to
be executed and recorded all such other and further assurances or other
instruments in writing as may in the opinion of Mortgagee be required or
desirable to carry out the intent and meaning of clause (x) of Granting
Clause Third.
(vii) Within 5 days after Mortgagor's receipt of any notice of any
motion, application or effort to reject any Facility Lease by any Lessor
or any trustee arising from or in connection with any case, proceeding or
other action commenced or pending by or against any Lessor under the Code
or any comparable provision contained in any present or future federal,
state, local, foreign or other statute, law, rule or regulation
("Comparable Provision"), Mortgagor shall give notice thereof to
Mortgagee. Mortgagor hereby (A) assigns to Mortgagee any and all of
Mortgagor's rights as lessee under Section 365(h) of the Code or any
Comparable Provision and (B) covenants that it shall not elect to treat
any Facility Lease as terminated pursuant to Section 365(h) of the Code or
any Comparable Provision without the prior consent of Mortgagee and (C)
agrees that any such election by Mortgagor without such consent shall be
null and void.
(viii) Without limiting the generality of the foregoing, to the
extent permitted by applicable law, Mortgagor hereby unconditionally
assigns, transfers and sets over to Mortgagee all of Mortgagor's claims
and rights to the payment of damages arising from any rejection by Lessor
of any Facility Lease under the Code or any Comparable Provision.
Mortgagee shall have the right to proceed in its own name or in the name
of Mortgagor in respect of any claim, suit, action or proceeding relating
to the rejection of any Facility Lease, including, without limitation, the
right to file and prosecute, in cooperation with Mortgagor, any proofs of
claim, complaints, motions, applications, notices and other documents, in
any case in respect of Lessor under the Code or any Comparable Provision.
This assignment constitutes a present, irrevocable and unconditional
assignment of the foregoing claims, rights and remedies, and shall
continue in effect until all of the indebtedness and obligations secured
by this Mortgage shall have been satisfied and discharged in full. Any
amounts received by Mortgagee in damages arising out of the rejection of
any Facility Lease as aforesaid shall be applied first to all reasonable
costs and expenses of Mortgagee (including, without limitation, reasonable
attorneys' fees, disbursements and court costs) incurred in connection
with the exercise of any of its rights or remedies under this Section
5.18, and thereafter as provided in Section 3.3.
(ix) If there shall be filed by or against Mortgagor a petition
under the Code or any Comparable Provision and Mortgagor, as lessee under
any Facility Lease, shall determine to reject such Facility Lease,
Mortgagor shall give Mortgagee not less than 10 days' prior notice of the
date on which Mortgagor shall apply to the Bankruptcy Court or other
judicial body with appropriate jurisdiction for authority to reject such
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Facility Lease. Mortgagee shall have the right, but not the obligation, to
serve upon Mortgagor within such 10-day period a notice stating that (a)
Mortgagee demands that Mortgagor assume and assign such Facility Lease to
Mortgagee pursuant to Section 365 of the Code or any Comparable Provision
and (b) Mortgagee covenants to cure or provide adequate assurance of
prompt cure of all defaults and provide adequate assurance of future
performance under such Facility Lease. If Mortgagee serves upon Mortgagor
the notice described in the preceding sentence, Mortgagor shall not seek
to reject such Facility Lease and shall comply with the demand provided
for in clause (a) of the preceding sentence within 30 days after the
notice shall have been given subject to the performance by Mortgagee of
the covenant provided for in clause (b) of the preceding sentence. The
foregoing provisions of this Section 5.18(ix) shall not apply to the
extent not permitted by applicable law. Effective upon the entry of an
order for relief in respect of Mortgagor under Chapter 7 of the Code or
any Comparable Provision, Mortgagor hereby assigns and transfers to
Mortgagee a non-exclusive right to apply to the Bankruptcy Court or other
judicial body with appropriate jurisdiction for an order extending the
period during which such Facility Lease may be rejected or assumed.
(x) Mortgagor shall promptly give to Mortgagee copies of (A) all
notices of default and (B) any other communications or notices with
respect to events that relate to the possible impairment of the security
of this Mortgage, which Mortgagor shall give or receive under any Facility
Lease and shall promptly notify Mortgagee of any default under any
Facility Lease on the part of the Lessor or Mortgagor.
(xi) Mortgagor shall enforce with due diligence all of the
obligations of the Lessor under each Facility Lease, to the end that
Mortgagor may enjoy all of the rights and privileges granted to it under
the Facility Leases.
(xii) Mortgagor shall notify Mortgagee within 5 days after the
transfer of a fee interest in any Leased Facility or any portion thereof
to or from an Affiliate.
(xiii) No Affiliate of Mortgagor shall at any time hereafter acquire
fee title to the Leased Land or any portion thereof unless simultaneously
with such acquisition such Affiliate and Mortgagor execute and exchange
(and deliver to the Trustee an executed counterpart of) an instrument in
form and substance satisfactory to Mortgagee providing that so long as
such Affiliate owns such fee title (A) such Affiliate shall not terminate
the applicable Facility Lease for any reason whatsoever (including,
without limitation, due to the default of Mortgagor under such Facility
Lease) and (B) such Affiliate shall not accept, and, if tendered by
Mortgagor shall promptly return to Mortgagor, any payment of rent or other
charges payable under such Facility Lease in excess of the amount required
to pay the debt service and other sums payable under any mortgage
affecting such Affiliate's fee interest in the applicable Leased Facility
(and such Affiliate shall use such funds only to pay its debt service
obligations and
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other sums payable under such mortgage) at any time that an Event of
Default, or a Default of the types described in Section 3.1(a), (b) and
(f) of this Mortgage or Section 5.1(a), (b), (f) or (g) of the TCHI Note
Indenture, shall have occurred and be continuing under this Mortgage or
the TCHI Note Indenture.
(c) Subject to the provisions of Subsection 5.18(b)(iii), if both the
lessor's and lessee's estates under any Facility Lease or any portion thereof
shall at any time become vested in one owner, this Mortgage and the lien created
hereby shall nevertheless not be destroyed or terminated by application of the
doctrine of merger and, in such event, Mortgagee shall continue to have all of
the rights and privileges of a first leasehold mortgagee.
(d) Mortgagor hereby acknowledges that if any Facility Lease shall be
terminated prior to the natural expiration of its term due to default by the
lessee thereunder, and if pursuant to such Facility Lease, Mortgagee or its
designee shall acquire from the Lessor a new lease of the Leased Facility or any
portion thereof, Mortgagor shall have no right, title or interest in or to such
lease or the leasehold estate created thereby, or the options therein contained.
(e) Each Facility Lease hereafter entered into or assumed by Mortgagor as
lessee or sublessee shall contain provisions (i) permitting the assignment of
the same to Mortgagee and the Trustee and permitting assignment without the
lessor's consent if this Mortgage is foreclosed; and (ii) providing protection
to Mortgagee, as leasehold mortgagee, in form reasonably satisfactory to
Mortgagee.
Section 5.19. Indemnification.
Mortgagor shall protect, indemnify, hold harmless and defend Mortgagee and
its directors, officers, partners, shareholders, agents, servants and employees
from and against any and all liabilities, obligations, claims, damages,
penalties, causes of action, costs and expenses (including, without limitation,
reasonable attorneys' fees, disbursements and court costs), imposed upon or
incurred by or asserted against Mortgagee by reason of (a) any injury to or
death of Persons or loss of or damage to property occurring on or about the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (b) any use, nonuse or condition of the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (c) any failure on the part of
Mortgagor to perform or comply with any of the terms of this Mortgage, (d)
performance of any labor or services or the furnishing of any materials or other
property in respect of the Premises or any part thereof made or suffered to be
made by or on behalf of Mortgagor, (e) any negligence or tortious act on the
part of Mortgagor or any of its agents, contractors, lessees, licensees or
invitees, or (f) any work in connection with the Premises; provided, that no
amounts shall be payable to Mortgagee under this Section 5.19 in respect of
liabilities, obligations, claims, damages, penalties, causes of action, costs or
expenses imposed upon or incurred by or asserted against Mortgagee to the extent
the same result from any
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negligence or tortious act on the part of Mortgagee or any of its agents,
contractors, lessees, licensees or invitees. All amounts payable to Mortgagee
under this Section 5.19 shall be payable on demand; provided, that with respect
to consequential damages (other than attorneys' fees, disbursements and court
costs imposed upon or incurred by Mortgagee in connection therewith, which shall
in all events be payable on demand), no such amounts shall be payable until, and
to the extent that, (i) there has been entered the final determination of a
court of competent jurisdiction awarding such consequential damages to the party
or parties seeking such damages or (ii) an agreement of settlement with respect
thereto (which shall have been previously approved by Mortgagor, such consent
not to be unreasonably withheld) shall have been executed by Mortgagee and such
party or parties. Any such amounts which are not paid within 5 days after demand
therefor by Mortgagee shall bear interest at the rate set forth in the Senior
Partnership Upstream Note from the date of such demand and all such amounts and
interest thereon shall be secured by the lien of this Mortgage. In case any
action, suit or proceeding is brought against Mortgagee by reason of any such
occurrence, Mortgagor, upon request of Mortgagee, shall, at Mortgagor's expense,
resist and defend such action, suit or proceeding or cause the same to be
resisted or defended by counsel designated by Mortgagor and approved by
Mortgagee, which approval shall not be unreasonably withheld; provided, that
Willkie, Farr & Gallagher is hereby approved by Mortgagee.
Section 5.20 Senior Mortgages
(a) Mortgagor shall at all times fully perform and comply with all
agreements, covenants, terms and conditions imposed upon or assumed by it as
mortgagor under the Senior Mortgages prior to the expiration of any notice
and/or cure period provided in each such Senior Mortgage. If a notice of default
has been given by the holder of the Senior Mortgages, Mortgagee may rely thereon
and take any action Mortgagee deems necessary in its sole discretion to prevent
or to cure any default by Mortgagor in the performance of or compliance with any
of the agreements, covenants, terms or conditions imposed upon or assumed by
Mortgagor as mortgagor (or assignee of the mortgagor) under the Senior Mortgages
even though the existence of such default or the nature thereof be questioned or
denied by Mortgagor or by any party on behalf of Mortgagor. Without limiting the
generality of Section 3.9, Mortgagor hereby expressly grants to Mortgagee, and
agrees that Mortgagee shall have, the absolute and immediate right to enter in
and upon the Premises or any part thereof to such extent and as often as
Mortgagee, in its sole discretion, deems necessary or desirable for the purpose
permitted by the immediately preceding sentence, subject only to applicable
Legal Requirements. Without limiting Mortgagor's obligations or Mortgagee's
rights set forth above or limiting Mortgagee's other remedies under this
Mortgage, Mortgagee may (i) pay and expend such sums of money as Mortgagee in
its sole discretion deems necessary or desirable for any such purpose and (ii)
in its sole discretion prepay the Senior Mortgages then in default, and
Mortgagor hereby agrees to pay to Mortgagee immediately and without demand, all
such sums referred to in (i) and (ii) above so paid and expended by Mortgagee,
together with interest thereon from the date of each such payment at the highest
rate of interest set forth in the Senior Partnership Upstream Note. All sums so
paid and expended by Mortgagee and the interest thereon, shall be added to and
be
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<PAGE>
secured by the lien of this Mortgage.
(b) Mortgagor further covenants and agrees:
(i) Mortgagor shall not, without first obtaining the consent of
Mortgagee in each instance: (A) modify, replace or refinance the Senior
Mortgages if (x) the collateral securing the lien thereof would be
increased thereby (other than after-acquired property required by the
terms of the Senior Mortgages to be encumbered thereby) or (y) such
modification, replacement or refinancing violates any other provision of
this Senior Partnership Upstream Note Mortgage or the TCHI Note Indenture
or (B) acquire or permit or suffer any Affiliate of Mortgagor to acquire
the Senior Mortgages or any Interest therein;
(ii) Mortgagor shall timely pay and perform all of the obligations
to be paid or performed by the mortgagor under the Senior Mortgages, the
notes secured thereby and any other instrument evidencing or securing the
indebtedness owing to any holder of the Senior Mortgages;
(iii) at any time and from time to time, Mortgagor shall upon
request of Mortgagee promptly use its reasonable efforts to obtain an
estoppel certificate or letter addressed to Mortgagee from the holder of
the Senior Mortgages, such certificate or letter to be in such form as
Mortgagee shall reasonably request;
(iv) Mortgagor shall promptly give to Mortgagee copies of (A) all
notices of default or (B) any other notice or communication with respect
to events which relate to the possible impairment of the security of this
Mortgage, which Mortgagor shall give or receive under the Senior Mortgages
and shall promptly notify Mortgagee of any default under the Senior
Mortgages on the part of Mortgagor.
[Remainder of this Page Intentionally Left Blank]
-64-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed and attested, all as of the day and year first above written.
TRUMP'S CASTLE ASSOCIATES, L.P., a
New Jersey limited partnership
By: Trump's Castle Hotel & Casino, Inc., its
general partner
Witness: /s/ Henry Smokler By: /s/ R. Bruce McKee
---------------------- -----------------------------------------
Henry Smokler Name: R. Bruce McKee
Title: Assistant Secretary and Vice
President
TRUMP'S CASTLE HOTEL & CASINO, INC., a New
Jersey Corporation
Witness: /s/ Henry Smokler By: /s/ R. Bruce McKee
---------------------- -----------------------------------------
Henry Smokler Name: R. Bruce McKee
Title: Assistant Secretary and Vice
President
-65-
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared R.
Bruce McKee, the Assistant Secretary and Vice President of TRUMP'S CASTLE HOTEL
& CASINO, INC., the general partner of TRUMP'S CASTLE ASSOCIATES, L.P., who I am
satisfied is the person who executed the within instrument and he acknowledged
that he signed and delivered the same as such officer on behalf of such entity
and that the within instrument is the voluntary act and deed of said corporation
made by virtue of the authority of its board of directors.
/s/ Matthew T. Collins
- ------------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-66-
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared R.
Bruce McKee, the Assistant Secretary and Vice President of TRUMP'S CASTLE HOTEL
& CASINO, INC., who I am satisfied is the person who executed the within
instrument and he acknowledged that he signed and delivered the same as such
officer on behalf of such entity and that the within instrument is the voluntary
act and deed of said corporation made by virtue of the authority of its board of
directors.
/s/ Matthew T. Collins
- -----------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-67-
<PAGE>
Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of Mortgage
and Security Agreement from Trump's Castle Associates to Trump's Castle Funding,
Inc. dated as of December 28, 1993 and recorded in the Atlantic County Registry
of Deeds in Mortgage Book 5238, Page 1, the mortgagee's interest in which was
assigned to First Bank National Association, now known as U.S. Bank National
Association, by a certain Senior Assignment Agreement dated as of December 28,
1993 and recorded in the Atlantic County Registry of Deeds in Assignment Book
651, Page 160 (the "Subordinate Associates Mortgage") hereby consents to and
acknowledges the provisions of the foregoing Senior Partnership Upstream Note
Mortgage and hereby subordinates the lien created by the Subordinate Associates
Mortgage to this Senior Partnership Upstream Note Mortgage.
U.S. BANK NATIONAL ASSOCIATION, a national
banking association
By: /s/ Richard H Prokosch
---------------------------------------
Name: Richard H Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- -----------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-68-
<PAGE>
Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of Mortgage
and Security Agreement from Trump's Castle Associates to First Bank National
Association, now known as U.S. Bank National Association, dated as of December
28, 1993 and recorded in the Atlantic County Registry of Deeds in Mortgage Book
5239, Page 1 (the "Subordinate Mortgage") hereby consents to and acknowledges
the provisions of the foregoing Senior Partnership Upstream Note Mortgage and
hereby subordinates the lien created by the Subordinate Mortgage to this Senior
Partnership Upstream Note Mortgage.
U.S. BANK NATIONAL ASSOCIATION, a national
banking association
By: /s/ Richard H Prokosch
----------------------------------------
Name: Richard H Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- -----------------------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-69-
<PAGE>
SCHEDULE 1
OWNED LAND
All the real property located in the City of Atlantic City, County of Atlantic,
and State of New Jersey and more particularly described as follows:
CASINO-HOTEL PARCEL
All that certain real property hereinafter particularly described situate, lying
and being in the City of Atlantic City, County of Atlantic and State of New
Jersey.
BEGINNING at the point of intersection of the northwesterly line of Huron Avenue
(100 feet wide) and the northeasterly line of the Atlantic - Brigantine
Boulevard, said Boulevard also known as State Highway Route 87, and extending;
thence
1. North 45 degrees 50 minutes 06 seconds West, in and along the
Atlantic-Brigantine Boulevard, 56.63 feet; thence
2. North 19 degrees 16 minutes 38 seconds East, still in and along said
Boulevard, 81.94 feet to a point of curve; thence
3. Curving to the right in the arc of a circle having a radius of 783.00
feet, the arc length of 72.815 feet to a point of reverse curve; thence
4. Curving to the left in the arc of a circle having a radius of 837.00
feet, the arc length of 77.836 feet to another point of reverse curve; thence
5. Curving to the right in the arc of a circle having a radius of 2946.00
feet,, the arc length of 1017.42 feet to a point; thence
6. North 44 degrees 34 minutes 15 seconds East, 135.02 feet to a point of
curve; thence
7. Curving to the right in the arc of a circle having a radius of 2936.00
feet, the arc length of 105.48 feet to a point; thence
8. South 27 degrees 28 minutes 00 seconds East, at right angles to Huron
Avenue 842.02 feet to the northwesterly line of Huron Avenue; thence
9. South 62 degrees 32 minutes 00 seconds West, in and along the
northwesterly line of Huron Avenue, 1229.40 feet to the point and place of
BEGINNING.
1-1
<PAGE>
EXCEPTING THEREOUT AND THEREFROM the property which was conveyed to the State of
New Jersey by the Deeds recorded in Deed Book 3980 page 180 and in Deed Book
4031 page 299.
BEING ALSO KNOWN AND DESIGNATED as Lot 9 in Block H-19 on the Official Tax Map
of the City of Atlantic City.
PARKING FACILITIES PARCEL
BEGINNING at a point in Beach Thorofare at the easterly corner of the parcel of
lands containing an area of 6.199 acres more or less which was conveyed by the
West Jersey and Seashore Railroad Company to the Press Union Publishing Company
by deed dated January 9, 1940, and recorded January 17, 1940 in Deed Book 1099
page 420, said beginning point being South 24 degrees 54 minutes 00 seconds
West, a distance of 100.16 feet from a monument set in the southeasterly line of
Absecon Boulevard (also known as U.S. Route 30) (190 feet wide), and extending
from said beginning point; thence,
(1) In Beach Thorofare, South 24 degrees 54 minutes 00 seconds West, a
distance of 259.81 feet to a point; thence
(2) Continuing in and along same, South 44 degrees 54 minutes 00 seconds West,
a distance of 445.50 feet to a point; thence,
(3) Continuing in and along same, South 72 degrees 24 minutes 00 seconds West,
a distance of 224.40 feet to a point; thence
(4) Continuing in and along same, North 68 degrees 21 minutes 00 seconds West,
a distance of 478.50 feet to a point; thence
(5) Continuing in and along same, North 76 degrees 06 minutes 00 seconds West,
a distance of 363.00 feet to a point; thence
(6) Continuing in and along same, South 82 degrees 39 minutes 00 seconds West,
a distance of 429.00 feet to a point; thence,
(7) Continuing in and along same, North 17 degrees 59 minutes 20 seconds East,
a distance of 320.65 feet to a point located in the approximate high water
line of Beach Thorofare, said point also being a corner of lands now or
formerly in Daniel Adams, et al, as recorded in Deed Book CC Page 272;
thence,
(8) North 39 degrees 01 minutes 00 seconds West, leaving Beach Thorofare, in
and along the line of lands now or formerly of Daniel Adams, et al, a
distance of 1089.00 feet to a point in the southeasterly line of lands now
or formerly of Lot 307 in Block 201 as shown on the current Official Tax
Map for the City of Atlantic City, said point also being a corner to lands
1-2
<PAGE>
now or formerly of Daniel Adams, et al; thence,
(9) North 57 degrees 59 minutes 00 seconds East, in and along the said lands,
a distance of 1113.19 feet to a point in the aforesaid southwesterly line
of Absecon Boulevard; thence,
(10) South 22 degrees 46 minutes 10 seconds East, in and along same, a distance
of 185.42 feet to a point of curve; thence,
(11) Southeastwardly, in and along same and in the arc of a circle curving to
the left having a radius of 1527.69 feet the arc length of 213.90 feet to
a point in the northwesterly line of Lot 230 in said Block 201; thence,
(12) South 09 degrees 08 minutes 24 seconds East, in the southwesterly line of
Absecon Boulevard, a distance of 87.75 feet to a point of curve; thence
(13) Curving to the left along the line of Absecon Boulevard, in the arc of a
circle having a radius of 332.00 feet, the arc length of 201.61 feet to a
point of tangent; thence
(14) South 43 degrees 56 minutes 03 seconds East, continuing in and along the
southwesterly line of Absecon Boulevard, a distance of 128.55 feet to a
point; thence
(15) South 82 degrees 36 minutes 59 seconds East, continuing in and along the
said southwesterly line of Absecon Boulevard, a distance of 10.00 feet to
a point; thence
(16) Curving to the right along the line of Absecon Boulevard, in the arc of a
circle having a radius of 70.00 feet, the arc length of 47.26 feet to a
point of tangent; thence
(17) North 46 degrees 03 minutes 57 seconds East, along the line of Absecon
Boulevard, a distance of 20.81 feet to a point which is radially distant
95.00 feet from the centerline of Absecon Boulevard (190' wide) at station
335+98.63 feet; thence
(18) Curving to the left in the Southwesterly line of Absecon Boulevard in the
arc of a circle having a radius of 1527.69 feet, the arc length of 70.33
feet to the northwesterly line of Lot 230 in said Block 201; thence
(19) South 41 degrees 59 minutes 00 seconds West, in and along same, a distance
of 125.00 feet to the extreme westerly corner of said Lot 230; thence
(20) Southeastwardly, in and along the southwesterly line of same, concentric
with Absecon Boulevard, in the arc of a circle curving to the left, having
a radius of 1652.69 feet, the arc length of 324.55 feet to the extreme
southeasterly corner of said Lot 230; thence
(21) North 30 degrees 43 minutes 55 seconds East, in and along the
southeasterly line of same, a
1-3
<PAGE>
distance of 125.00 feet to a point in the aforesaid southwesterly line of
Absecon Boulevard; thence
(22) Southeastwardly, in and along same and in the arc of a circle curving to
the left, having a radius of 1527.69 feet, the arc length of 245.58 feet
to a point of tangency; thence
(23) South 68 degrees 22 minutes 10 seconds East, in and along same, a distance
of 50.00 feet to a point in the westerly line of the previously mentioned
6.199+/- acre parcel, also being the northwesterly line of Lot 150 in said
Block 201; thence
(24) South 21 degrees 38 minutes 00 seconds West, in and along same, a distance
of 100.00 feet to a corner in said Lot 150; thence
(25) Continuing in and along same, North 68 degrees 22 minutes 10 seconds west,
a distance of 94.75 feet to a corner; thence
(26) Continuing in and along same, South 27 degrees 48 minutes 00 seconds West,
a distance of 89.04 feet to a corner; thence
(27) Continuing in and along same, South 54 degrees 39 minutes 00 seconds West,
a distance of 65.88 feet to a corner; thence
(28) Continuing in and along same, South 71 degrees 53 minutes 00 seconds West,
a distance of 201.55 feet to a corner; thence
(29) Continuing in and along same, South 51 degrees 29 minutes 00 seconds east,
a distance of 172.09 feet to a corner; thence
(30) Continuing in and along same, South 25 degrees 20 minutes 00 seconds east,
a distance of 216.73 feet to a corner; thence
(31) Continuing in and along same and crossing the aforesaid high water line of
Beach Thorofare, South 84 degrees 22 minutes 00 seconds East, a distance
of 256.83 feet to a corner; thence
(32) Continuing in and along same, North 79 degrees 58 minutes 00 seconds East,
a distance of 279.10 Feet to a corner; thence
(33) Continuing in and along same, North 41 degrees 22 minutes 00 seconds east,
a distance of 266.39 feet to the point and place of BEGINNING.
BEING ALSO KNOWN AND DESIGNATED as Lot 231 in Book 201 on the Official Tax Map
of the City of Atlantic City.
1-4
<PAGE>
(PEDESTRIAN BRIDGE)
Air rights, rights of way and easements including the right to construct,
maintain and use a Pedestrian Bridge across Huron Avenue connecting the
Casino-Hotel Parcel with the Farley State Marina Site contained in Ordinance No.
2 of 1988 and affecting the following described premises:
ALL that certain lot, tract, or parcel of land and premises situate, lying, and
being in the City of Atlantic City, County of Atlantic, and State of New Jersey,
bounded and described as follows:
BEGINNING at a point in the southerly line of Huron Avenue (100 feet wide), said
point being distant 956.00' eastwardly from the easterly line of Maryland Avenue
(65 feet wide), if same were extended northwardly, and extending from said
beginning point; thence
(1) North 27 degrees 28 minutes 00 seconds West, crossing Huron Avenue, a
distance of 100.00 feet to the northerly line of Huron Avenue; thence
(2) North 62 degrees 32 minutes 00 seconds East, in and along the northerly
line of Huron Avenue, a distance of 30.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, crossing Huron Avenue, a
distance of 100.00 feet to the southerly line of Huron Avenue; thence
(4) South 62 degrees 32 minutes 00 seconds West, in and along the southerly
line of Huron Avenue, a distance of 30.00 feet to the point and place of
BEGINNING.
BEING an area above the horizontal plane of Huron Avenue between the elevation
of 25.00 M.S.L. datum and 50.00 M.S.L. datum.
1-5
<PAGE>
SCHEDULE 2
Leased Land
THE FARLEY STATE MARINA SITE
Beginning at the southeasterly corner of Maryland Avenue (68.00 feet wide
and Huron Avenue 100.00 feet wide) and extending from said beginning point;
thence
(1) South 27 degrees 28 minutes 00 seconds East, in and along the
easterly line of Maryland Avenue, a distance of 804.15 feet; thence
(2) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, a distance of 200.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, parallel with
Maryland Avenue, a distance of 1060.85 feet to a point distant
1745.00' northwardly at right angles from the northerly line of
Mediterranean Avenue (60.00 feet wide), said point being in the
fifth course as recited in the Riparian Grant from the State of New
Jersey to the City of Atlantic City, dated March 15, 1920 and
recorded in the Clerk's Office of Atlantic County in Book 632 of
Deeds, Page 117, etc.; thence
(4) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, and in and along said aforementioned Riparian Grant Line, a
distance of 25.00 feet; thence
(5) North 27 degrees 28 minutes 00 seconds West, parallel with
Maryland Avenue, and in and along said aforementioned Riparian Grant
Line, a distance of 9.26 feet; thence
(6) North 09 degrees 01 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 0.04 feet; thence
(7) North 02 degrees 18 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 590.00 feet;
thence
(8) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, in and along said aforementioned Riparian Grant Line, a
distance of 160.00 feet; thence
(9) North 41 degrees 39 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 255.00 feet;
thence
2-1
<PAGE>
(10) North 47 degrees 34 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 285.00 feet;
thence
(11) North 56 degrees 02 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 360.80' to a point
distant 1550.00 feet eastwardly at right angles from the easterly
line of Maryland Avenue; thence
(12) North 27 degrees 28 minutes 00 seconds West, parallel with
Maryland Avenue, a distance of 568.21 feet; thence
(13) North 62 degrees 32 minutes 00 seconds East, parallel with
Huron Avenue, a distance of 200.00 feet to the westerly line of
Rhode Island Avenue (50.00 feet wide); thence
(14) North 27 degrees 28 minutes 00 seconds West, in and along the
westerly line of Rhode Island Avenue, a distance of 570.00 feet to
the southerly line of Huron Avenue; thence
(15) South 62 degrees 32 minutes 00 seconds West, in and along the
southerly line of Huron Avenue, a distance of 1750.00 feet to the
point and place of BEGINNING.
EXCEPTING THEREOUT AND THEREFROM the following parcel of land described as:
MARINE POLICE BUILDING PARCEL
BEGINNING at a point in the westerly line of Rhode Island Avenue (50.00 feet
wide), said point being distant 570.00 feet south of the southerly line of Huron
Avenue (100.00 feet wide) and extending; thence
1. South 62 degrees 32 minutes 00 seconds West, parallel with Huron Avenue,
and in and along the division line between Lot 10 and Lot 11 in Block B-4
as shown on the current taxing plan of the City of Atlantic City, a
distance of 97.97 feet; thence
2. North 27 degrees 28 minutes 00 seconds West, parallel with Rhode Island
Avenue, a distance of 179.00 feet; thence
3. North 62 degrees 32 minutes 00 seconds East, parallel with Huron Avenue, a
distance of 97.97 feet to the Westerly line of Rhode Island Avenue; thence
4. South 27 degrees 28 minutes 00 seconds East, in and along the westerly
line of Rhode Island Avenue, a distance of 179.00 feet to the point and
place of BEGINNING.
ALSO EXCEPTING THEREON AND THEREFROM such land and improvements being referred
to as the 7 berths on K dock, for use of the Marina Law Enforcement Bureau as
further described in
2-2
<PAGE>
the Lease referred to in a Short Form Memorandum of Lease recorded in Deed Book
5365, Page 221, and further shown on survey by Arthur W. Ponzio Co. & Assoc.,
Inc., dated December 28, 1993 and bearing Job No 18488.
BEING ALSO KNOWN AND DESIGNATED as part of Lot 11 in Block B-4 as shown on the
Official Tax Map of Atlantic City, New Jersey.
2-3
<PAGE>
SCHEDULE 3
Existing Encumbrances
1. All matters disclosed in Schedule B and D of the Pro Forma Title Insurance
Policies issued as of the date hereof by Chicago Title Insurance Company
(Numbers 31-131-107-03894 and 31-131-107-03909), First American Title Insurance
Company (Numbers 252242 and 255354) and Commonwealth Land Title Insurance
Company (Numbers L980366 and L980366A);
2. All matters disclosed in Schedule C of the Pro Forma Title Insurance Policies
issued as of the date hereof by Chicago Title Insurance Company (Numbers
31-131-107-03894 and 31-131-107-03909), First American Title Insurance Company
(Numbers 252242 and 255354) and Commonwealth Land Title Insurance Company
(Numbers L980366 and L980366A);
3. All UCC-1 Financing Statements naming Trump's Castle Associates, L.P., as
debtor, and filed prior to April 17, 1998, other than those filed in favor of
(i) Midlantic National Bank, (ii) PNC Bank, N.A., or (iii) First Bank National
Association, as Trustee, under the previously existing Senior Notes;
4. Judgment Number CV-02371-93, entered on September 18, 1997 and Judgment
Number DJ-426844-97, entered on October 20, 1997, both in favor of Amplicon,
Inc.;
5. UCC-1 Financing Statement Number 0018501, filed August 14, 1995, naming
Somerset Ice Co. Inc., as Debtor, and NatWest Bank, N.A., as Secured Party;
6. UCC-1 Financing Statement Number 0017919, filed May 19, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and United Jersey Bank, as
Assignee;
7. UCC-1 Financing Statement Number 0017931, filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and NatWest, as Assignee;
8. UCC-1 Financing Statement Number 0017932 filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and Valley National Bank, as
Assignee;
9. UCC-1 Financing Statement Number 0017933, filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and Bank of New York, as Assignee;
10. Account balances due to Atlantic City Municipal Utilities Authority for the
properties through April 17, 1998.
3-1
<PAGE>
SCHEDULE 4
FORM OF NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
THIS AGREEMENT, made as of the ______ day of ________ by and between U.S.
Bank National Association (hereinafter called "Mortgagee") having an office at
180 Fifth Street, St. Paul, Minnesota 55101 and ______________________________ a
_____________________ corporation having an office at
_________________________________ (hereinafter called "Tenant").
W I T N E S S E T H:
WHEREAS, Mortgagee is the mortgagee under that certain Indenture of
Mortgage dated April 17, 1998 (said mortgage, as it may be amended, increased,
renewed, modified, consolidated, replaced, combined, substituted, severed,
split, spread or extended, being hereinafter referred to as the "Mortgage")
between Trump's Castle Hotel & Casino, Inc. ("Funding") and Trump's Castle
Associates, L.P. (the "Partnership") which encumbers Trump Marina Hotel Casino
and certain other real property located in Atlantic City, New Jersey, more
particularly described in Exhibit A hereto. Funding assigned all of its right,
title and interest in the Mortgage to U.S. Bank National Association, as Trustee
under that certain Indenture dated as of April 17, 1998 by and between
Mortgagee, Funding and the Partnership, pursuant to an Assignment Agreement
dated as of April 17, 1998; and
WHEREAS, Tenant has entered into a certain agreement of lease dated [as
amended by agreements dated ___________________ [and amended by amendments dated
______________] and as it may be hereafter amended from time to time (the
"Lease") covering __________________________________________ (the "Demised
Premises").
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto agree as follows:
1. Tenant covenants and agrees that the Lease now is and shall at all
times continue to be subject and subordinate in each and every respect to the
Mortgage. Tenant, upon request, shall execute and deliver any certificate or
other instrument which the Mortgagee may reasonably request to confirm said
subordination by Tenant.
2. Tenant certifies that the Lease is presently in full force and effect
and unmodified and no base rent payable thereunder has been paid more than one
(1) Year in advance of its due date, and that no default exists under the Lease
which has continued beyond the expiration of any applicable
4-1
<PAGE>
grace period.
3. As long as Tenant is in compliance with the terms of this Agreement and
no default exists under the Lease which has continued beyond the expiration of
any applicable grace period, Mortgagee shall not name Tenant as a party
defendant to any action for foreclosure or other enforcement thereof (unless
required by law), nor shall the Lease be terminated by mortgagee in connection
with, or by reason of, foreclosure or other proceedings for the enforcement of
the Mortgage, or by reason of a transfer of the landlord's interest under the
Lease pursuant to the taking of a deed in lieu of foreclosure (or similar
device), nor shall Tenant's use or possession of the Demised Premises be
interfered with by Mortgagee, unless the holder of the landlord's interest under
the Lease (the "Landlord") would have had such right if the Mortgage had not
been made, except that the person acquiring, or succeeding to the interests of
the Landlord as a result of any such action or proceeding, and such person's
successors and assigns (any of the foregoing being hereinafter referred to as
the Successor"), shall not be:
(a) subject to any credits, offsets, defenses or claims which Tenant
might have against any prior landlord; nor
(b) bound by any base rent which Tenant might have paid for more
than the current month to any prior landlord, unless such prepayment shall
have been made with Mortgagee's prior written consent; nor
(c) liable for any act or omission of any prior landlord; nor
(d) bound by any covenant to undertake or complete any improvement
to the Demised Premises or the building forming a part of the Property;
nor
(e) be required to account for any security deposit other than any
security deposit actually delivered to the Successor; nor
(f) liable for any payment to Tenant of any sums, or the granting to
Tenant of any credit, in the nature of a contribution towards the cost of
preparing, furnishing or moving into-the Demised Premises or any portion
thereof.
4. If the interest of the Landlord under the Lease shall be transferred by
reason of foreclosure or other proceedings for enforcement of the Mortgage or
pursuant to a taking of a deed in lieu of foreclosure (or similar device),
Tenant shall be bound to the Successor, and, except as provided in this
Agreement, the Successor shall be bound to Tenant, under all of the terms,
covenants and conditions of the Lease for the balance of the term thereof
remaining, with the same force and effect as if the Successor were the Landlord,
and Tenant does hereby (i) agree to attorn to the Successor, including Mortgagee
if it be the Successor, as its landlord, (ii) affirm its obligations under the
Lease, and (iii) agree to make payments of all sums due under the Lease to the
Successor, said attornment, affirmation and agreement to be effective and
self-operative without the execution of
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<PAGE>
any further instruments, upon the Successor succeeding to the interest to the
Landlord under the Lease. Tenant waives the provisions of any statute or rule of
law now or hereafter in effect that may give or purport to give it any right or
election to terminate or otherwise adversely affect the Lease or the obligations
of Tenant thereunder by reason of any foreclosure or similar proceeding.
5. This Agreement may not be modified except by an agreement in writing
signed by the parties or their respective successors in interest. This Agreement
shall inure to the benefit of and be binding upon the parties hereto, their
respective heirs, representatives, successors and assigns.
6. Nothing contained in this Agreement shall in any way impair or affect
the lien created by the Mortgage except as specifically set forth herein.
7. The Tenant agrees that this Agreement satisfies any condition or
requirement in the Lease relating to the granting of a non-disturbance agreement
by Mortgagee. Tenant further agrees that in the event there is any inconsistency
between the terms and provisions hereof and the terms and provisions of the
Lease dealing with non-disturbance by Mortgagee, the terms and provisions hereof
shall be controlling.
8. All notices, demands or requests made pursuant to, under, or by virtue
of this Agreement must be in writing and mailed to the party whom the notice,
demand or request is being made by certified or registered mail, return receipt
requested, at its address set forth above. Any party may change the place that
notices and demands are to be sent by written notice delivered in accordance
with this Agreement.
9. This Agreement shall be governed by the laws of the State of New
Jersey. If any term of this Agreement or the application thereof to any person
or circumstances shall to any extent be invalid or unenforceable, the remainder
of this Agreement or the application of such term to any person or circumstances
other than those as to which it is invalid or unenforceable shall not be
affected thereby, and each term of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have hereunto caused this Agreement
to be duly executed as of the day and year first above written.
MORTGAGEE
By:
---------------------------------
TENANT
By:
---------------------------------
[Acknowledgments]
4-4
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
(TCHI Note Guarantee Mortgage)
TRUMP'S CASTLE ASSOCIATES, L.P.
Mortgagor/Debtor
and
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the TCHI Note Indenture, Mortgagee/Secured Party
Dated as of April 17, 1998
Record and Return to:
Robert L. Nutt, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110-2624
<PAGE>
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OFGENERAL APPLICATION..................8
Section 1.1. Definitions..............................................8
Section 1.2. Notices..................................................18
Section 1.3. Form and Contents of Documents Delivered to Mortgagee...19
Section 1.4. Compliance Certificates and Opinions.....................20
Section 1.5. Effect of Headings and Table of Contents.................20
Section 1.6. Successors and Assigns; Amendments.......................21
Section 1.7. Separability Clause......................................21
Section 1.8. Benefits of Mortgage.....................................21
Section 1.9. Governing Law............................................21
Section 1.10. Limitation on Liability..................................21
Section 1.11. Provisions Required by TCHI Note Indenture...............22
Section 1.12. Rights of Trustee as Mortgagee...........................22
Section 1.13. Mortgage Subject to Casino Control Act...................23
Section 1.14. Discharge of Lien........................................23
Section 1.15. General Application......................................24
Section 1.16. TCHI Note Guarantee Mortgage Deemed to be Security
Agreement................................................24
Section 1.17. No Duplication of Notices or Payments....................24
ARTICLE TWO
RELEASE; SUBORDINATION..................................................25
Section 2.1. Possession by Mortgagor..................................25
Section 2.2. Obsolete Property........................................25
Section 2.3. F,F&E Financing Agreements...............................26
ARTICLE THREE
REMEDIES................................................................27
Section 3.1. Events of Default........................................27
Section 3.2. [Intentionally Omitted]..................................28
Section 3.3. Application of Moneys Received by Mortgagee..............28
Section 3.4. Restoration of Rights and Remedies.......................29
Section 3.5. Rights and Remedies Cumulative...........................29
Section 3.6. Delay or Omission Not Waiver.............................29
Section 3.7. Undertaking for Costs....................................29
Section 3.8. Waiver of Appraisement and Other Laws....................29
Section 3.9. Entry....................................................30
Section 3.10. Power of Sale; Suits for Enforcement.....................30
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Section 3.11. Incidents of Sale........................................31
Section 3.12. Receiver.................................................32
Section 3.13. Suits to Protect the Trust Estate........................32
Section 3.14. Management of the Premises...............................32
ARTICLE FOUR
CONSOLIDATION, MERGER, CONVEYANCE,TRANSFER OR LEASE.....................33
Section 4.1. Consolidation, Merger, Conveyance or Transfer Only on
Certain Terms............................................33
Section 4.2. Successor Entity Substituted.............................33
ARTICLE FIVE
COVENANTS AND REPRESENTATIONS OF MORTGAGOR..............................33
Section 5.1. Performance of Senior Guarantee Obligations..............33
Section 5.2. F,F&E Financing Agreements...............................34
Section 5.3. Limitations on Liens and Transfers.......................34
Section 5.4. Environmental............................................35
Section 5.5. Warranty of Leasehold Estate and Title...................38
Section 5.6. After-Acquired Property; Further Assurances; Recording...39
Section 5.7. Payment of Taxes and Certain Claims; Maintenance of
Properties; Compliance with Legal Requirements
and Insurance Requirements...............................41
Section 5.8. Permitted Contests.......................................42
Section 5.9. Mechanics' and Other Liens...............................43
Section 5.10. To Insure................................................43
Section 5.11. Limitations on Building Demolition, Alterations,
Improvements and New Construction........................49
Section 5.12. Leases...................................................51
Section 5.13. Compliance Certificates..................................53
Section 5.14. To Keep Books; Inspection by Mortgagee...................53
Section 5.15. Advances by Mortgagee....................................53
Section 5.16. Waiver of Stay, Extension or Usury Laws..................54
Section 5.17. Eminent Domain...........................................54
Section 5.18. Facility Leases..........................................56
Section 5.19. Indemnification..........................................60
Section 5.20 Senior Mortgages.........................................61
SCHEDULE 1
OWNED LAND ............................................................1-1
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SCHEDULE 2
Leased Land............................................................2-1
SCHEDULE 3
Existing Encumbrances..................................................3-1
SCHEDULE 4
FORM OF NON-DISTURBANCEAND ATTORNMENT AGREEMENT........................4-1
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<PAGE>
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT
INDENTURE OF MORTGAGE AND SECURITY AGREEMENT ("Mortgage" or "TCHI Note
Guarantee Mortgage"), dated as of April 17, 1998, between TRUMP'S CASTLE
ASSOCIATES, L.P., a New Jersey limited partnership having an office at
Brigantine Boulevard and Huron Avenue, Atlantic City, New Jersey 08401
("Mortgagor"), and U.S. BANK NATIONAL ASSOCIATION, a national banking
association, not individually but in its capacity as Trustee under the TCHI Note
Indenture (as hereinafter defined), having an office at 180 East Fifth Street,
St. Paul, Minnesota 55101 ("Mortgagee").
Witnesseth:
In consideration of $10.00 in hand paid by Mortgagee to Mortgagor and for
other good and valuable consideration, the receipt and sufficiency whereof is
hereby acknowledged, and in order to secure (i) the punctual payment and
performance when due of all of Mortgagor's obligations under the TCHI Guarantee;
(ii) the punctural payment and performance when due of all TCHI's and
Mortgagor's obligations under the TCHI Notes and the TCHI Note Indenture; (iii)
payment by Mortgagor to Mortgagee of all sums expended or advanced by Mortgagee
pursuant to any term or provision of this TCHI Note Guarantee Mortgage; (iv)
performance of each covenant, term, condition and agreement of Mortgagor herein
contained; (v) all costs and expenses, including, without limitation, reasonable
counsel fees and expenses as provided in Section 3.7 of this TCHI Note Guarantee
Mortgage, which may arise in respect of this TCHI Note Guarantee Mortgage or of
the obligations secured hereby; and (vi) performance and observance of all of
the provisions herein contained, Mortgagor has executed and delivered this TCHI
Note Guarantee Mortgage and has bargained, sold, aliened, mortgaged, pledged,
released, conveyed and confirmed unto Mortgagee and its successors hereunder and
assigns forever, and does hereby grant to Mortgagee and its successors a
security interest in and to, all of Mortgagor's right, title and interest in, to
and under all of the following described property and the proceeds thereof:
GRANTING CLAUSES
Granting Clause First
All of the property, rights, title, interest, privileges and franchises
particularly described in annexed Schedule 1 (the "Owned Land"), which Schedule
is hereby made a part of, and deemed to be described in, this Granting Clause as
fully as if set forth in this Granting Clause at length.
<PAGE>
Granting Clause Second
[Intentionally omitted]
Granting Clause Third
All of the property, rights, title, interest, privileges and franchises of
Mortgagor as lessee under all Facility Leases (including, to the extent
permissible to the Landlord under the Marina Lease, the Marina Lease), together
with (i) all credits, deposits, privileges and rights of Mortgagor as lessee
under the Facility Leases, now or at any time existing, (ii) the leaseholds and
the leasehold estates created by the Facility Leases and (iii) all of the
estates, rights, titles, claims or demands whatsoever of Mortgagor, either in
law or in equity, in possession or in expectancy, of, in and to the Facility
Leases and the Leased Facilities (including, but not limited to, the Leased Land
particularly described in annexed Schedule 2), together with (x) any and all
other, further or additional title, estates, interests or rights which may at
any time be acquired by Mortgagor in or to the Leased Facilities or any part
thereof, and Mortgagor expressly agrees that if Mortgagor shall, at any time
prior to payment in full of all indebtedness secured hereby, acquire fee simple
title or any other greater estate to the Leased Facilities, the lien of this
TCHI Note Guarantee Mortgage shall attach, extend to, cover and be a lien upon
such fee simple title or other greater estate and thereupon the lien of this
TCHI Note Guarantee Mortgage, subject to Permitted Encumbrances, shall be prior
to the lien of any mortgage or deed of trust placed on such acquired title,
estate, interest or right subsequent to the date of this TCHI Note Guarantee
Mortgage and (y) any right to possession or statutory term of years derived
from, or incident to, the Facility Leases pursuant to Section 365(h) of the Code
or any Comparable Provision.
Granting Clause Fourth
All of the rents, issues, profits, revenues, accounts, accounts receivable
and other income and proceeds (including, without limitation, all rents, fees,
charges, accounts, issues, profits, revenues and payments for or from (a) the
use or occupancy of the rooms and other public facilities in the Hotel and (b)
the operation of the Casino) of the property subjected or required to be
subjected to the lien of this TCHI Note Guarantee Mortgage, including, without
limitation, the property described in Granting Clauses First, Third and Seventh
(said property described in Granting Clauses First, Third and Seventh and
similar other property subjected or required to be subjected to the lien of this
TCHI Note Guarantee Mortgage, together with all such rents, issues, profits,
revenues, accounts, accounts receivable and other income and proceeds therefrom
is hereinafter collectively referred to as the "Premises") and all of the
estate, right, title and interest of every nature whatsoever of Mortgagor in and
to the same and every part thereof.
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<PAGE>
Granting Clause Fifth
All of the rights of Mortgagor as lessor under the Leases in effect on the
date of execution of this TCHI Note Guarantee Mortgage or hereafter entered into
by Mortgagor, including modifications, extensions and renewals of all of the
same, and the immediate and continuing right as security after the occurrence,
and during the continuance, of an Event of Default, to (a) make claim for,
collect, receive and receipt for (and to apply the same as provided herein) any
and all rents, fees, charges, income, revenues, issues, profits, security and
other sums of money payable or receivable thereunder or pursuant thereto, and
all proceeds thereof, whether payable as rent, insurance proceeds, condemnation
awards, security or otherwise and whether payable prior to or subsequent to the
Stated Maturity of the TCHI Notes, (b) receive and give notices and consents
thereunder, (c) bring actions and proceedings thereunder or for the enforcement
thereof, (d) make waivers and agreements thereunder or with respect thereto, (e)
take such action upon the happening of a default under any Lease, including the
commencement, conduct and consummation of any proceedings at law or in equity as
shall be permitted by any provision of any Lease, and (f) do any and all things
which Mortgagor or any lessor is or may become entitled to do under the Leases;
provided that, except as may be set forth to the contrary herein, the assignment
made by this Granting Clause Fifth shall not impair or diminish any right,
privilege or obligation of Mortgagor under the Leases nor shall any such
obligation be imposed upon Mortgagee.
Granting Clause Sixth
Without limiting the generality of the provisions of Granting Clause
Fourth, all of Mortgagor's rights, title, interest, privileges and franchises in
and to the following, now owned or hereafter acquired by Mortgagor, to the
extent of Mortgagor's interest therein and thereto and to the extent assignable
(collectively, "Operating Assets"):
(a) bookings for the use of guest rooms, banquet facilities, meeting rooms
at the Casino Hotel or at any other improvements now or hereafter located on any
of the Land;
(b) all contracts respecting utility services for, and the maintenance,
operations, or equipping of, the Premises, including guaranties and warranties
relating thereto;
(c) the Permits;
(d) all contract rights, leases (whether with respect to real property,
personal property or both real and personal property), concessions, trademarks,
trade names, service marks, logos, copyrights, warranties and other items of
intangible personal property, and any and all good will associated with the
same, relating to the ownership or operation of the Casino Hotel or of any other
improvements now or hereafter located on any of the Land, including, without
limitation, (1) employment contracts with officers and other employees of
Mortgagor, (2) telephone and
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<PAGE>
other communication numbers, (3) all software licensing agreements as are
required to operate computer software systems at the Casino Hotel or at any
other improvements now or hereafter located on any of the Land and books and
records relating to the software programs and (4) Mortgagor's interest under
leases of Tangible Personal Property;
(e) all contracts, purchase orders, requisitions and agreements entered
into by or on behalf of Mortgagor or which have been assigned to Mortgagor, for
the design, construction, and furnishing of the Casino Hotel or of any other
improvements now or hereafter located on any of the Land, including, without
limitation, architect's agreements, engineering agreements, construction
contracts, consulting agreements and agreements or purchase orders for all items
of Tangible Personal Property and payment and performance bonds in favor of
Mortgagor in connection with the Trust Estate (and all warranties and guarantees
thereunder and warranties and guarantees of any subcontractor and bond issued in
connection with the work to be performed by any subcontractor);
(f) the following personal property (the "Tangible Personal Property") now
or hereafter acquired by Mortgagor (directly or by way of lease) which is
located on, or to be located on, or which are in use or held in reserve storage
for future use in connection with the gaming or other operations of, the Casino
Hotel or of any other improvements now or hereafter located on any of the Land,
which is on hand or on order whether stored on-site or off-site:
(i) all furniture, furnishings, equipment, machinery, lighting,
apparatus (both interior and exterior), appliances, fixtures and fittings
and other articles of tangible personal property;
(ii) all slot machines, electronic gaming devices, crap tables,
blackjack tables, poker tables, roulette tables, baccarat tables, big six
wheels and other gaming tables, and all furnishings and equipment to be
used in connection with the operation thereof;
(iii) all cards, dice, gaming chips and plaques, tokens, chip racks,
dealing shoes, dice cups, dice sticks, layouts, paddles, roulette balls
and other consumable supplies and items;
(iv) all china, glassware, linens, kitchen utensils, silverware and
uniforms;
(v) all consumable and operating supplies of every kind and nature,
including, without limitation, accounting supplies, guest supplies, forms,
printing, stationery, food and beverage stock, bar supplies, laundry
supplies and brochures to existing purchase orders;
(vi) all upholstery material, carpets and rugs, beds, bureaus,
chiffonniers, chairs, chests, desks, bookcases, tables, curtains,
hangings, pictures, divans, couches, ornaments, bars, bar fixtures, safes,
stoves, ranges, refrigerators, radios, televisions, clocks; electrical
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<PAGE>
equipment, lamps, mirrors, heating and lighting fixtures and equipment,
ice machines, air conditioning machines, fire prevention and extinguishing
apparatus, laundry machines, and all similar and related articles used in
bedrooms, sitting rooms, bathrooms, boudoirs, halls, closets, kitchens,
dining rooms, offices, lobbies, basements and cellars in the Casino Hotel
and in any other improvements now or hereafter located on any of the Land;
(vii) all sets and scenery, costumes, props and other items of
tangible personal property on hand or on order for use in the production
of shows in any showroom, convention space, exhibition hall, or sports and
entertainment arena of the Casino Hotel or in any other improvements now
or hereafter located on any of the Land; and
(viii) all cars, limousines, vans, buses, trucks and other vehicles
owned or leased by Mortgagor for use in connection with the operation of
the Premises, together with all equipment, parts and supplies used to
service, repair, maintain and equip the foregoing;
(g) all drawings, designs, plans and specifications prepared by
architects, engineers, interior designers, landscape designers and any other
professionals or consultants for the design, development, construction and/or
improvement of the Casino Hotel, or for any other development of the Premises,
as amended from time to time;
(h) any administrative and judicial proceedings initiated by Mortgagor, or
in which Mortgagor has intervened, concerning the Premises, and agreements, if
any, which are the subject matter of such proceedings;
(i) any customer lists utilized by Mortgagor including lists of transient
guests and restaurant and bar patrons and "high roller" lists; and
(j) all of the good will in connection with the assets listed in this
Granting Clause Sixth and in connection with the operation of the Premises.
Except as may be set forth to the contrary herein, the assignment made by
this Granting Clause Sixth shall not impair or diminish any right, privilege or
obligation of Mortgagor with respect to the Operating Assets, nor shall any such
obligation be imposed on Mortgagee.
Granting Clause Seventh
(a) All of Mortgagor's rights, title, interest, privileges and franchises,
if any, in and to all buildings, structures (surface and subsurface), and other
improvements of every kind and description, including, without limitation, all
pedestrian bridges, entrance-ways, parking lots, plazas, curb-cuts, walkways,
driveways and landscaping and such fixtures as constitute real property, now or
hereafter erected or placed on the Land or on any other land or any interest
therein hereafter acquired by Mortgagor and all of Mortgagor's rights, title,
interest, privileges
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<PAGE>
and franchises in and to all fixtures and articles of personal property now or
hereafter attached to or contained in and used in connection with such buildings
and improvements, including, without limitation, all apparatus, furniture,
furnishings, lighting equipment, electronic billboards, machinery, motors,
elevators, fittings, radiators, cooking ranges, ice boxes, ice machines,
printing presses, mirrors, bars, mechanical refrigerators, furnaces, coal and
oil burning apparatus, wall cabinets, machinery, generators, partitions, steam
and hot water boilers, lighting and power plants, pipes, plumbing, radiators,
sinks, bath tubs, water closets, gas and electrical fixtures, awnings, shades,
screens, blinds, dishwashers, freezers, vacuum cleaning systems, office
equipment and other furnishings, and all plumbing, heating, lighting, cooking,
laundry, ventilating, incinerating, air-conditioning and sprinkler equipment or
other fire prevention or extinguishing apparatus and material, and fixtures and
appurtenances thereto; and all renewals or replacements thereof or articles in
substitution therefor, whether or not the same are or shall be attached to the
Land, any other land or any interest therein hereafter acquired by Mortgagor or
to any such buildings and improvements thereon, in any manner.
(b) All of Mortgagor's rights, title, interest, privileges and franchises
in and to all other property, real, personal or mixed (other than Excepted
Property), of every kind and description and wheresoever situate, now owned or
which may be hereafter acquired by Mortgagor, it being the intention hereof that
all property, interests, rights, privileges and franchises now owned by
Mortgagor or acquired by Mortgagor after the date hereof (other than Excepted
Property) shall be as fully embraced within and subjected to the lien hereof as
if such property were specifically described herein.
* * *
TOGETHER with all of Mortgagor's right, title and interest in and to any
and all mineral and water rights and any title or reversion, in and to the beds
of the ways, streets, avenues and alleys adjoining the Premises to the center
line thereof and in and to all strips, gaps and gores adjoining the Premises on
all sides thereof; and
TOGETHER with any and all of Mortgagor's right, title and interest in and
to the tenements, hereditaments, easements, appurtenances, passages, waters,
water courses, riparian rights, other rights, liberties and privileges thereof
or in any way now or hereafter appertaining to the Premises, including, without
limitation, any other claim at law or in equity as well as any after-acquired
title, franchise or license and the reversion and reversions and remainder and
remainders thereof; and
TOGETHER with any and all awards and other compensation heretofore or
hereafter to be made to the present and all subsequent owners of the Trust
Estate for any taking by eminent domain, either permanent or temporary, of all
or any part of the Trust Estate or any easement or appurtenances thereof,
including severance and consequential damage and change in grade of streets, all
in accordance with and subject to the provisions of the Superior Instrument
Requirements and Section 5.17; and
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<PAGE>
TOGETHER with any and all proceeds of any unearned premiums on any
insurance policies described in Sections 5.10, and the right to receive and
apply the proceeds of any insurance, judgments, or settlements made in lieu
thereof, for damage to the Trust Estate or otherwise, all in accordance with and
subject to the provisions of Section 5.10 and the Superior Instrument
Requirements; and
TOGETHER with all proceeds of every kind and nature, and all products of
every kind and nature, of any of the foregoing property, rights, title,
interests, privileges, franchises and other assets described in Granting Clauses
First through Seventh or in any of the other clauses thereafter.
The foregoing shall include, whether or not specifically identified in one
or more instances, all such property, rights, title, interests, privileges,
franchises and other assets now owned and/or hereafter existing.
EXCLUDING, with respect to all of the hereinabove granted property,
rights, title, interest, privileges and franchises described in Granting Clauses
First through Seventh or in the six immediately preceding paragraphs, all
Excepted Property now or hereafter existing.
TO HAVE AND TO HOLD all of said Premises, Leases, Facility Leases,
Operating Assets, properties, options, credits, deposits, rights, privileges and
franchises of every kind and description, real, personal or mixed, hereby and
hereafter granted, bargained, sold, aliened, assigned, transferred,
hypothecated, pledged, released, conveyed, mortgaged, or confirmed as aforesaid,
or intended, agreed or covenanted so to be, together with all the appurtenances
thereto appertaining (said Premises, Leases, Facility Leases, Operating Assets,
properties, options, credits, deposits, rights, privileges and franchises, other
than Excepted Property now or hereafter existing, being herein collectively
called the "Trust Estate") unto Mortgagee and its successors and assigns
forever.
PROVIDED, HOWEVER, that the lien of this TCHI Note Guarantee Mortgage upon
the Trust Estate shall rank pari passu with the lien of the Senior Note Mortgage
, the lien of the Senior Guarantee Mortgage and the lien of the Senior
Partnership Upstream Note Mortgage.
BUT IN TRUST, NEVERTHELESS, for the ratable benefit and security of the
Holders.
UPON CONDITION that, until the happening of an Event of Default, Mortgagor
shall be permitted to possess and use the Trust Estate, and to receive and use
the rents, issues, profits, revenues and other income of the Trust Estate.
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<PAGE>
AND IT IS HEREBY COVENANTED AND DECLARED that the Trust Estate is to be
held and applied by Mortgagee, subject to the further covenants, conditions and
trusts hereinafter set forth, and Mortgagor does hereby covenant and agree to
and with Mortgagee, for the ratable benefit of the Holders, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
Section 1.1. Definitions.
For all purposes of this TCHI Note Guarantee Mortgage, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article One have the meanings assigned to
them in this Article One and include the plural as well as the singular;
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them, and all computations herein provided for shall be made, in
accordance with generally accepted accounting principles in effect on the date
hereof consistently applied; and
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this TCHI Note Guarantee Mortgage as a whole and not to
any particular Article, Section or other subdivision.
"Affiliate" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Alterations" has the meaning set forth in Section 5.11.
"Appraised Value" means the fair market value of the Casino Hotel, and of
all other property now or hereafter owned or leased by Mortgagor and subject to
the lien of this TCHI Note Guarantee Mortgage, as determined by an Independent
Appraiser on the basis of an appraisal in conformity with the criteria set forth
at 12 C.F.R. ss. 564.4 or such similar published policy or regulation as from
time to time governs real estate related transactions by institutions regulated
by the Office of Thrift Supervision; provided, that the value of the Casino
Hotel and such other property shall not include the value of (i) any furniture,
fixtures and equipment therein to the extent of the Outstanding Amount of any
Indebtedness secured by any F,F&E Financing Agreements with respect thereto and
(ii) any Excepted Property.
"Appraiser" means a "state certified appraiser" as defined in 12 C.F.R.
ss. 564.2(i) who is (i) of recognized standing among appraisers of properties
similar to the Casino Hotel and (ii)
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experienced in the appraisals of properties of a similar size and scope to that
of the Casino Hotel, selected by Mortgagor.
"Architect" means an Independent Person selected by Mortgagor and licensed
as an architect in the State of New Jersey.
"Casino" means that portion of the Casino Hotel used for gaming and
related activities.
"Casino Hotel" means the casino and hotel complex currently known as the
"Trump Marina Hotel Casino" in Atlantic City, New Jersey, and ancillary
structures and facilities located on the Premises (other than the property
covered by the Marina Lease) and all furniture, fixtures and equipment at any
time contained therein in each case owned by or leased to Mortgagor and covered
by the lien of the Senior Note Mortgage.
"Casualty" means any act or occurrence of any kind or nature which results
in damage, loss or destruction to any buildings or improvements on the Premises
and/or Tangible Personal Property.
"Certificate of Appraised Value" means the certificate of an Independent
Appraiser stating the Appraised Value.
"Code" means the Federal Bankruptcy Code, Title 11 of the United States
Code, as amended.
"Company" means Trump's Castle Funding, Inc., a corporation incorporated
under the laws of the State of New Jersey.
"Comparable Provision" has the meaning set forth in Section 5.18.
"Default" means any event which is, or after notice or lapse of time or
both would be, an Event of Default. Without limiting the generality of the
previous provisions of this definition, the term "Default" shall include the
occurrence of an event as to which a notice of default has been given to
Mortgagor under any Facility Lease by a Lessor or under the Superior Mortgage by
the holder thereof, which has not yet been cured.
"Event of Default" has the meaning set forth in Section 3.1.
"Excepted Property" means:
(1) the personal property owned by lessees under Leases and the personal
property of any Hotel guests;
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(2) trade names, intellectual property rights and other rights and
interests in and to the use of the terms "Trump's Castle," "Trump," "Trump's
Castle Casino Resort", "Trump Marina Hotel Casino", "Trump Marina", "Donald J.
Trump," "Donald Trump" or related variations thereof; and
(3) any property deemed to be Excepted Property pursuant to the provisions
of Section 2.3;
(4) counterchecks, cash and any other property to the extent that the
granting of a security interest therein is prohibited by the New Jersey Casino
Control Act and the regulations promulgated thereunder;
(5) any property acquired pursuant to secured purchase - money
indebtedness permitted under clause "h" of the definition of "Permitted
Indebtedness" in the TCHI Note Indenture; and
(6) all equity interests in any Person now owned or hereafter acquired by
Mortgagor (including, without limitation, the capital stock of the Company)
which are required to be pledged under the indenture (as the same may be
amended, modified, supplemented or restated) relating to the 15 1/2% senior
secured notes due 2005 of Trump Hotels & Casino Resorts Holdings, L.P. and Trump
Hotels & Casino Resorts Funding, Inc.
"Existing Encumbrances" means the matters set forth in Schedule 3 hereto.
"Facility Leases" means, collectively:
(1) the Marina Lease;
(2) Any leases other than Capital Lease Obligations and the Marina Lease
where the Mortgagor is tenant or sub-tenant; provided, however, that the
aggregate fixed rental payments paid or accrued for any period of four
consecutive fiscal quarters commencing after the date hereof under all such
leases (including payments required to be made by the lessee in respect of taxes
and insurance, whether or not denominated as rent), shall not exceed for such
period (a) $2,000,000 or (b) $7,500,000 following the time at which the
Partnership shall have achieved EBITDA for any period of four consecutive
quarters in an amount not less than $45.0 million; provided, further, that the
Mortgagor may designate certain such leases which are not material to the
operations of the Casino Hotel and which have aggregate fixed rental payments
(including payments required to be made by the lessee in respect of taxes and
insurance, whether or not denominated as rent) not exceeding an aggregate of
$300,000 per year to be excluded from the leases covered by this clause (2); and
(3) any and all modifications, extensions and renewals of the leases
described in clauses (1) and (2) above, to the extent the same are permitted
under Section 5.18.
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"F,F&E Financing Agreement" has the meaning set forth in Section 1.1 of
the.
"Full Insurable Value" means the actual replacement cost (excluding the
costs of foundation, footing, excavation, paving, landscaping and other similar,
noninsurable improvements) of the insurable properties in question.
"Holder" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Hotel" means that portion of the Casino Hotel not included within the
Casino.
"Impositions" has the meaning set forth in Section 5.7.
"Indebtedness" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Independent" when used with respect to any specified Person means such a
Person who (i) is in fact independent, (ii) does not have any direct financial
interest or any material indirect financial interest in Mortgagor or in any
other obligor upon the TCHI Notes or in any Affiliate of Mortgagor or of such
other obligor and (iii) is not connected with Mortgagor or such other obligor or
any Affiliate of Mortgagor or such other obligor as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing similar
functions. Whenever it is herein provided that any Independent Person's opinion
or certificate shall be furnished to Mortgagee, such opinion or certificate
shall state that the signer has read this definition and that the signer is
Independent within the meaning thereof. A Person who is performing or who has
performed services as an independent contractor to any specified Person shall
not be considered not Independent merely by reason of the fact that such Person
is performing or has performed such services.
"Insurance Amount" has the meaning set forth in Section 5.10(a)(i).
"Insurance Requirements" means all terms of any insurance policy covering
or applicable to the Trust Estate or any part thereof, all requirements of the
issuer of any such policy, and all orders, rules, regulations and other
requirements of the National Board of Fire Underwriters (or any other body
exercising similar functions) applicable to or affecting the Trust Estate or any
part thereof or any use or condition of the Trust Estate or any part thereof.
"Insurance Trustee" means the Trustee or, if the Trustee so elects, any
bank, trust company or insurance company with a net worth in excess of
$100,000,000, designated by the Trustee.
"Insurer" means (i) an insurance company or companies selected by
Mortgagor authorized to issue insurance in the State of New Jersey with an A.M.
Best rating level of A minus or better and an A.M. Best financial size category
of VIII or better or (ii) Lloyds of London so long as its financial capacity is
not such that prudent owners of first-class casino and
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hotel complexes in Atlantic City, New Jersey would be unwilling to accept Lloyds
of London; provided, that with respect to the insurance required to be
maintained pursuant to Section 5.10(a)(i), up to 1.0% of the total amount of
such insurance in excess of the first $10,000,000 thereof may be maintained with
an insurance company or companies not meeting the foregoing A.M. Best rating
level and/or A.M. Best financial size categories; and provided, further, that
Mortgagor shall in all events use commercially reasonable efforts to obtain
insurance issued by insurance companies having an A.M.
Best rating level of better than A minus.
"Land" means, collectively, the Owned Land and the Leased Land.
"Lease" means each lease or sublease (made by Mortgagor, as lessor or
sublessor, as the case may be) of any space in any building or buildings, an
interest in which building or buildings constitutes a part of the Trust Estate,
including every agreement relating thereto or entered into in connection
therewith and every guarantee of the performance and observance of the
covenants, conditions and agreements to be performed by the lessee or sublessee
under any such lease or sublease. For purposes hereof, the term "Lease" shall
include any license agreement, concession agreement or other occupancy
agreement. Notwithstanding the foregoing, the term "Lease" shall not include any
transient room rentals.
"Leased Facilities" means, collectively, the Leased Land and any buildings
and improvements now or hereafter located thereon.
"Leased Land" means, collectively, the Marina Lease and any other land
that is now or hereafter subject to a Facility Lease.
"Legal Requirements" means all laws, statutes, codes, acts, ordinances,
orders, judgments, decrees, injunctions, rules, regulations, permits, licenses,
authorizations, directions and requirements (including, without limitation, the
New Jersey Casino Control Act, the New Jersey Industrial Site Recovery and the
New Jersey Spill Compensation and Control Act of 1976) of all governments,
departments, commissions, boards, courts, authorities, agencies, officials and
officers, of governments, federal, state and municipal (including, without
limitation, the New Jersey Department of Environmental Protection, the Atlantic
City Bureau of Investigations, the Division of Gaming Enforcement of the State
of New Jersey, and the Casino Control Commission of the State of New Jersey),
foreseen or unforeseen, ordinary or extraordinary, which now are or at any time
hereafter become applicable to the Trust Estate or any part thereof, or any of
the adjoining sidewalks, or any use or condition of the Trust Estate or any part
thereof, including, without limitation, the use of the Casino Hotel as a gaming
or gambling facility.
"Lessors" means the lessors under the Facility Leases.
"Marina Lease" means the lease agreement made September 1, 1990 between
the State of New Jersey, as Landlord, and Mortgagor, as tenant, respecting
property known as the Senator
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Frank S. Farley State Marina, Atlantic City, New Jersey, being designated as a
portion of Block B-4, Lot 11 on the tax map of the City of Atlantic City,
Atlantic County, New Jersey, as more particularly described on Schedule A
appended hereto and made a part hereof, together with all amendments,
restatements, extensions and renewals of said lease agreement, a memorandum of
which Lease was recorded June 2, 1992 in the Atlantic County Registry of Deeds
in Deed Book 5365, Page 211.
"Maturity" when used with respect to any Indebtedness means the date on
which the principal (or any portion thereof) of such Indebtedness becomes due
and payable as therein or herein provided, whether at the Stated Maturity, upon
acceleration, optional redemption, required repurchase, scheduled principal
payment or otherwise.
"Mortgage Debt" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
"Mortgage Documents" has the meaning set forth in Section 1.1 of the
Mortgage Note Indenture.
"Mortgage Note Indenture" means that certain indenture dated as of
December 28, 1993 among the Company, as issuer, the Mortgagor, as guarantor, and
First. Bank National Association (now known as U.S. Bank National Association),
as trustee, as it may be amended from time to time, relating to the Company's
Mortgage Notes.
"Mortgage Notes" means the 11-3/4% Mortgage Notes due 2003 issued by the
Company pursuant to the Mortgage Note Indenture.
"Mortgages" means this TCHI Note Guarantee Mortgage, the Senior Note
Mortgage, the Senior Guarantee Mortgage and the Senior Partnership Upstream Note
Mortgage.
"Mortgagee" has the meaning set forth in the first paragraph of this
instrument and its successors and assigns.
"Mortgagor" means the Person named as "Mortgagor" in the first paragraph
of this instrument until a successor entity shall have become such pursuant to
the applicable provisions of this TCHI Note Guarantee Mortgage, and thereafter,
except to the extent otherwise contemplated by Section 4.2, "Mortgagor" shall
mean such successor entity exclusively.
"Mortgagor Order" and "Mortgagor Request" mean, respectively, a written
order or request signed with a Mortgagor Signature and delivered to Mortgagee.
"Mortgagor Signature" means the signature of the President or a Vice
President of a corporate general partner of Mortgagor or of a general partner of
Mortgagor.
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"Mortgagor's Certificate" means a certificate signed with a Mortgagor
Signature and delivered to Mortgagee.
"Notices" has the meaning set forth in Section 1.2.
"Operating Assets" has the meaning set forth in Granting Clause Sixth.
"Opinion of Counsel" means a written opinion of counsel who may (except as
otherwise expressly provided in this TCHI Note Guarantee Mortgage) be an
employee of Mortgagor or of an Affiliate of Mortgagor.
"Original Policy" means the ALTA Loan Policies of Title Insurance issued
by First American Title Insurance Company, Chicago Title Insurance Company and
Commonwealth Land Title Insurance Company, pursuant to Title Commitment No.
L980366, dated the date hereof.
"Outstanding Amount" has the meaning set forth in Section 1.1 of the TCHI
Note Indenture.
"Owned Land" has the meaning set forth in Granting Clause First.
"Permits" means all licenses, franchises, authorizations, statements of
compliance, certificates of operation, certificates of occupancy and permits
required for the lawful ownership, occupancy, operation and use of all or a
material portion of the Premises whether held by Mortgagor or any other Person
(which may be temporary or permanent) (including, without limitation, those
required for the use of the Casino Hotel as a licensed casino facility), in
accordance with all applicable Legal Requirements.
"Permitted Encumbrances" means:
(1) liens for taxes, assessments, or governmental charges not yet due and
payable, or if due and payable not delinquent, to the extent that any fine,
penalty, interest or cost may be added for nonpayment thereof;
(2) Existing Encumbrances;
(3) F,F&E Financing Agreements permitted by the Senior Note Indenture or
the TCHI Note Indenture;
(4) the liens of the Mortgage Documents
(5) the liens of the Mortgages and any rights granted as provided therein;
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(6) the lien of the Trustee provided for in Section 6.6 of the Senior Note
Indenture and the TCHI Note Indenture and of the trustees under corresponding
sections of the Mortgage Note Indenture and the PIK Note Indenture;
(7) any lien or encumbrance which, under the provisions of Section 5.7,
constitutes a Permitted Encumbrance;
(8) Restricted Encumbrances;
(9) any Working Capital Facility Mortgage (including the TCHI Note
Guarantee Mortgage and the Senior Partnership Upstream Mortgage);
(10) any lien or encumbrance permitted under Section 5.3 of this Mortgage;
(11) any lien or encumbrance securing purchase money indebtedness
permitted by the Senior Note Indenture and the TCHI Note Indenture;
(12) modifications, refinancings, extension, renewals or replacements, in
whole or in part, of the liens described in clauses (2) through (11) of this
definition to the extent permitted by the Senior Note Indenture and the TCHI
Note Indenture; and
(13) any Facility Lease now existing or hereafter entered into.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or any other entity or government or any agency or
political subdivision thereof.
"PIK Note Indenture" means that certain indenture dated as of December 28,
1993 among the Company, as issuer, the Mortgagor, as guarantor, and First Bank
National Association (now known as U.S. Bank National Association), as trustee,
as it may be amended from time to time, relating to the Company's PIK Notes.
"PIK Notes" means the Company's 13 7/8% Pay-in-Kind Notes due 2005.
"Premises" has the meaning set forth in Granting Clause Fourth.
"Restoration" has the meaning set forth in Section 5.10(e)(iii).
"Restricted Encumbrances" means any Leases permitted by and made in
accordance with Section 5.12 of this TCHI Note Guarantee Mortgage.
"Securities Act" has the meaning set forth in Section 1.1 of the TCHI Note
Indenture.
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"Senior Guarantee" means the guarantee by Mortgagor of the Company's
Indenture Obligations (as defined in the Senior Note Indenture) pursuant to
Article 14 of the Senior Note Indenture.
"Senior Guarantee Mortgage" means a certain Indenture of Mortgage and
Security Agreement, dated of even date herewith, between the Mortgagor, as
mortgagor/debtor, and U.S. Bank National Association, as trustee, as
mortgagee/secured party, securing the Senior Notes and which evidences a lien
pari passu with the lien of this TCHI Note Guarantee Mortgage, the lien of the
Senior Note Mortgage, the lien of the Senior Partnership Upstream Note Mortgage
and the lien of any other Working Capital Facility Mortgage.
"Senior Indebtedness" means the Indebtedness evidenced by the Senior
Partnership Note, the Senior Guarantee, the Senior Notes and any Working Capital
Facility (including without limitation the TCHI Notes, the Senior Partnership
Upstream Note and the TCHI Guarantee) and any amendments, extensions, renewals,
replacements or restatements of any of the foregoing to the extent permitted by
the Senior Note Indenture and the TCHI Note Indenture.
"Senior Mortgages" means the Senior Guarantee Mortgage and the Senior Note
Mortgage.
"Senior Note Indenture" means that certain indenture of even date herewith
among Mortgagor, as guarantor, the Company, as issuer, and U.S. Bank National
Association, as trustee, relating to the Senior Notes as it may from time to
time be supplemented, modified or amended by one or more trust indentures or
other instruments supplemental thereto entered into pursuant to the applicable
provisions thereof.
"Senior Note Mortgage" means a certain Indenture of Mortgage and Security
Agreement, dated of even date herewith, between the Mortgagor, as
mortgagor/debtor, and the Company, as mortgagee/secured party, securing the
Senior Partnership Note and which evidences a lien pari passu with the lien of
this Mortgage, the lien of the Senior Guarantee Mortgage, the lien of the Senior
Partnership Upstream Note Mortgage, the lien of the Senior Note Mortgage and the
lien of any other Working Capital Facility Mortgage.
"Senior Notes" means the 10 1/4% Senior Secured Notes due 2003 issued by
the Company under the Senior Note Indenture.
"Senior Partnership Note" means that certain Senior Partnership Note of
even date herewith in the original principal amount of $62,000,000 made by
Mortgagor in favor of the Company, a true copy of which note is attached to the
Senior Note Indenture as Exhibit A, and any amendments, extensions, renewals,
replacements or restatements of the same to the extent permitted under the
Senior Note Indenture.
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"Senior Partnership Upstream Note" means that certain promissory note of
even date herewith in the original principal amount of $5,000,000 made by the
Mortgagor in favor of TCHI, a copy of which is attached to the TCHI Note
Indenture, and any amendments, extensions, renewals, replacements or
restatements thereof.
"Senior Partnership Upstream Note Mortgage" means that certain Indenture
of Mortgage and Security Agreement, dated of even date herewith, between the
Mortgagor, as mortgagor/debtor, and TCHI, as mortgagee/secured party, securing
the Senior Partnership Upstream Note and which evidences a lien pari passu with
the lien of this TCHI Note Guarantee Mortgage, the lien of the Senior Guarantee
Mortgage, the lien of the Senior Note Mortgage and the lien of any other Working
Capital Facility Mortgage.
"Senior TCHI Assignment Agreement" means the Senior TCHI Assignment
Agreement of even date herewith made by TCHI, as assignor, to the Trustee, as
assignee, providing for assignment of the Senior Partnership Upstream Note and
the Senior Partnership Upstream Note Mortgage.
"Settlement Costs" has the meaning set forth in Section 5.17.
"Stated Maturity" when used with respect to any Indebtedness, means the
date specified in such Indebtedness as the fixed date on which the principal of
such Indebtedness is due and payable.
"Superior Instrument Requirements" means the applicable terms, conditions
and provisions of any documentation which constitutes, evidences, secures or
governs any Senior Indebtedness, together with the terms and conditions of the
Marina Lease.
"Taking" means the acquisition or condemnation by eminent domain of the
whole or any part of the Premises, by a competent authority, for any public or
quasi-public use or purpose.
"Tangible Personal Property" has the meaning set forth in subclause (f) of
Granting Clause Sixth.
"TCHI" means Trump's Castle Hotel & Casino, Inc., a corporation
incorporated under the laws of the State of New Jersey, or any other obligor on
the TCHI Notes (other than Mortgagor).
"TCHI Guarantee" means the guarantee by Mortgagor of TCHI's Indenture
Obligations (as defined in the TCHI Note Indenture) pursuant to Article 14 of
the TCHI Note Indenture.
"TCHI Note Guarantee Mortgage" means this Indenture of Mortgage and
Security Agreement which evidences a lien pari passu with the lien of the Senior
Note Mortgage, the lien
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of the Senior Guarantee Mortgage, the lien of the TCHI Note Mortgage and the
lien of any other Working Capital Facility Mortgage.
"TCHI Note Indenture" means that certain indenture of even date herewith
between TCHI, as issuer, Mortgagor, as guarantor, and the Trustee, as trustee,
relating to the TCHI Notes as it may from time to time be supplemented, modified
or amended by one or more trust indentures or other instruments supplemental
thereto entered into pursuant to the applicable provisions thereof.
"TCHI Notes" means the 10 1/4% Senior Secured Notes due 2003 in the
original principal amount of $5,000,000 issued pursuant to the TCHI Note
Indenture.
"Trust Estate" has the meaning stated in the habendum to the Granting
Clauses.
"Trust Indenture Act" has the meaning set forth in Section 1.1 of the TCHI
Note Indenture.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of the TCHI Note Indenture and any successor thereto,
"Uniform Commercial Code" means the New Jersey Uniform Commercial Code
N.J.S.A. 12A:1-101, et seq.
"Working Capital Facility" has the meaning set forth in Section 1.1 of the
TCHI Note Indenture.
"Working Capital Facility Mortgage" any mortgage or other security
interest or agreement (including, without limitation this TCHI Note Guarantee
Mortgage and the Senior Partnership Upstream Note Mortgage) which secures a
Working Capital Facility and which evidences a lien pari passu with the lien of
this TCHI Note Guarantee Mortgage, the lien of the Senior Note Mortgage, the
lien of the Senior Guarantee Mortgage, and the lien of the Senior Partnership
Upstream Note Mortgage.
Section 1.2. Notices.
(a) Any request, demand, authorization, direction, notice (including,
without limitation, a notice of default), consent, waiver or other document
provided or permitted by this TCHI Note Guarantee Mortgage to be made upon,
given or furnished to, or filed with, Mortgagor, Mortgagee or the Trustee
(collectively, "Notices") shall be in writing and shall be deemed given either
(i) when delivered by hand (including by overnight courier) or (ii) two days
after sending by registered or certified mail, postage prepaid, addressed as
follows:
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To Mortgagor:
Trump's Castle Associates, L.P.
Trump Marina Hotel Casino
Brigantine Boulevard and Huron Avenue
Atlantic City, New Jersey 08401
Attn: Chief Financial Officer
and and after May 26, 1998:
Willkie Farr & Gallagher Willkie Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, New York 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
To Mortgagee:
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Administration
(b) By Notice to Mortgagor or Mortgagee either party may designate
additional or substitute addresses for Notices which, notwithstanding Subsection
(a) above, shall be deemed given when received.
Section 1.3. Form and Contents of Documents Delivered to Mortgagee.
Whenever several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other such matters in one or several documents.
Any certificate or opinion of a general partner of Mortgagor may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such general partner knows that the
certificate or opinion or representations with respect to the matters upon which
his certificate or opinion is based are erroneous. Any Opinion of Counsel may be
based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, a general partner of Mortgagor stating that the
information with respect to such factual matters is in the possession of
Mortgagor, unless such counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous. If appropriate
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to the matter being opined upon and to the extent not prohibited by the Trust
Indenture Act, conclusions stated in any Opinion of Counsel may be subject to
rights of creditors and the availability of equitable remedies.
Whenever any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this TCHI Note Guarantee Mortgage, they may, but need not, be
consolidated to form one instrument.
Whenever in this TCHI Note Guarantee Mortgage, in connection with any
application or certificate or report to Mortgagee, it is provided that Mortgagor
shall deliver any document as a condition of the granting of such application,
or as evidence of Mortgagor's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of Mortgagor to have such application granted or to the
sufficiency of such certificate or report.
Every application, certificate, report, affidavit, opinion, consent,
statement or other instrument required to be delivered to Mortgagee under this
TCHI Note Guarantee Mortgage or under any other Mortgage Document shall be in
writing and shall be prepared and delivered without cost or expense to
Mortgagee.
Section 1.4. Compliance Certificates and Opinions.
Upon any application or request by Mortgagor to Mortgagee to take any
action under any provision of this TCHI Note Guarantee Mortgage, Mortgagor shall
furnish to Mortgagee a Mortgagor's Certificate stating that all conditions
precedent, if any, provided for in this TCHI Note Guarantee Mortgage relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this TCHI Note Guarantee Mortgage relating to such particular
application or request, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this TCHI Note Guarantee Mortgage shall include:
(a) a statement that each individual signing such certificate or opinion
has read such condition or covenant and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such condition or covenant has been
complied with;
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and (d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 1.5. Effect of Headings and Table of Contents.
The Article and Section headings herein and in the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 1.6. Successors and Assigns; Amendments.
(a) Subject to the provisions of Sections 1.10 and 4.2 hereof and Sections
3.11 and 8.2 of the TCHI Note Indenture, this TCHI Note Guarantee Mortgage shall
be binding upon and inure to the benefit of the parties hereto and of the
respective successors and assigns of the parties hereto to the same effect as if
each such successor or assign were in each case named as a party to this TCHI
Note Guarantee Mortgage.
(b) This TCHI Note Guarantee Mortgage may not be modified, amended,
discharged, released nor any of its provisions waived except by agreement in
writing executed by Mortgagor and Mortgagee and in accordance with the
provisions of this TCHI Note Guarantee Mortgage and the TCHI Note Indenture.
Section 1.7. Separability Clause.
In case any provision in this TCHI Note Guarantee Mortgage shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 1.8. Benefits of Mortgage.
Without limiting the generality of Section 3.12, nothing in this TCHI Note
Guarantee Mortgage, or in the TCHI Notes, express or implied, shall give to any
Person, other than the parties hereto and their successors and assigns, any
benefit or any legal or equitable right, remedy or claim under this TCHI Note
Guarantee Mortgage.
Section 1.9. Governing Law.
This TCHI Note Guarantee Mortgage shall be deemed to be a contract under
the laws of the State of New Jersey and shall be construed in accordance with
and governed by the laws of the State of New Jersey.
Section 1.10. Limitation on Liability.
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Notwithstanding anything herein or in any other agreement, document,
certificate, instrument, statement or omission referred to below to the
contrary, Mortgagor is liable hereunder only to the extent of the assets of
Mortgagor and no other person or entity, including, without limitation, any
partner, officer, committee or committee member of Mortgagor or any partner
therein or in any partnership Affiliate of Mortgagor, or any incorporator,
officer, director or shareholder of any corporate partner of Mortgagor or of any
corporate Affiliate of Mortgagor, or any Affiliate or controlling person or
entity of any of the foregoing, or any agent, employee, or lender of any of the
foregoing, or any successor, personal representative, heir or assign of any of
the foregoing, in each case past, present or as they may exist in the future,
shall be liable in any respect (including, without limitation, the breach of any
representation, warranty, covenant, agreement, condition or indemnification or
contribution undertaking contained herein or therein) under, in connection with,
arising out of or relating to this TCHI Note Guarantee Mortgage, or any other
agreement, document, certificate, instrument or statement (oral or written)
related to, executed or to be executed, delivered or to be delivered, or made or
to be made, or any omission made or to be made, in connection with any of the
foregoing or any of the transactions contemplated in any such agreement,
document, certificate, instrument, or statement. Any agreement, document,
certificate, statement or other instrument to be executed simultaneously with,
in connection with, arising out of or relating to this TCHI Note Guarantee
Mortgage or any other agreement, document, certificate, statement or instrument
referred to above, or any agreement, document, certificate, statement or
instrument contemplated hereby shall contain language mutatis mutandis to this
Section 1.10 and, if such language is omitted, shall be deemed to contain such
language.
Section 1.11. Provisions Required by TCHI Note Indenture.
Whenever the provisions of this TCHI Note Guarantee Mortgage and the
provisions of the TCHI Note Indenture shall be inconsistent, the provisions of
the TCHI Note Indenture shall govern.
Section 1.12. Rights of Trustee as Mortgagee.
Except as otherwise provided in Section 6.2 of the TCHI Note Indenture:
(1) Mortgagee may rely, and shall be protected in acting or
refraining from acting, upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(2) any request or direction of Mortgagor mentioned herein shall be
sufficiently evidenced by a Mortgagor Request or Mortgagor Order;
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(3) whenever in the administration of this TCHI Note Guarantee
Mortgage, Mortgagee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder,
Mortgagee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon a Mortgagor's
Certificate;
(4) Mortgagee may consult with counsel and any written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by Mortgagee hereunder in good faith and in reliance thereon;
(5) Mortgagee shall be under no obligation to exercise any of the
rights or powers vested in it by this TCHI Note Guarantee Mortgage at the
request or direction of any of the Holders pursuant to the TCHI Note
Indenture, unless such Holders shall have offered to Mortgagee reasonable
security or indemnity against the costs, expenses and liabilities which
might be incurred therein or thereby in compliance with such request or
direction;
(6) Mortgagee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, appraisal, bond, debenture, note, coupon, security or other
paper or document but Mortgagee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit,
and, if Mortgagee shall determine to make such further inquiry or
investigation, it shall be entitled (subject to the express limitations
with respect thereto contained in this TCHI Note Guarantee Mortgage) to
examine the books, records and premises of Mortgagor, personally or by
agent or attorney;
(7) Mortgagee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys, and Mortgagee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder;
(8) Mortgagee shall not be personally liable, in case of entry by it
upon the Trust Estate, for debts contracted or liabilities or damages
incurred in the management or operation of the Trust Estate;
(9) Mortgagor shall pay or cause to be paid to the Trustee all
compensation and other amounts provided in Section 6.6 of the TCHI Note
Indenture; and
(10) no provision of this TCHI Note Guarantee Mortgage shall require
Mortgagee to expend or risk its own funds or otherwise incur any financial
liability in the performance of its obligations hereunder, or in the
exercise of any of its rights or powers.
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Section 1.13. Mortgage Subject to Casino Control Act.
Each provision of this TCHI Note Guarantee Mortgage is subject to and
shall be enforced in compliance with the provisions of the New Jersey Casino
Control Act.
Section 1.14. Discharge of Lien.
If (a) Mortgagor shall pay or cause to be paid, or there shall otherwise
be paid, to Mortgagee all amounts required to be paid by Mortgagor pursuant to
this TCHI Note Guarantee Mortgage and the TCHI Notes and the conditions
precedent for the TCHI Note Indenture to cease, determine and become null and
void (except for any surviving rights of transfer or exchange of the TCHI Notes
provided in Section 13.1 of the TCHI Note Indenture and for the obligation to
pay the Trustee's fees and expenses provided in Section 6.6 of the TCHI Note
Indenture) in accordance with Section 13.1 of the TCHI Note Indenture shall have
occurred, or (b) there shall have occurred a "defeasance" (as defined in Section
4.2 of the TCHI Note Indenture) of the TCHI Notes, or (c) there shall have
occurred a "covenant defeasance" (as defined in Section 4.3 of the TCHI Note
Indenture), then in any such case Mortgagee shall promptly cancel and discharge
this TCHI Note Guarantee Mortgage, and any financing statements filed in
connection herewith and execute and deliver to Mortgagor all such instruments as
may be necessary, required or appropriate to evidence such discharge and
satisfaction of said lien or liens.
Section 1.15. General Application.
(a) The remedies of Mortgagee upon any default by Mortgagor in the
fulfillment of any of its obligations hereunder shall be limited in each
instance by the provisions of Section 1.10, whether or not the provisions
providing for such remedies explicitly refer to such Section.
(b) The assertion of any rights upon any Default shall be subject in each
instance to, if required, the giving of any notice and the expiration of any
grace period provided for in Section 3.1 as a condition to such Default becoming
an Event of Default, unless the Trust Indenture Act requires otherwise, in which
case the Trust Indenture Act shall control.
(c) For the purposes of this TCHI Note Guarantee Mortgage, it is
understood that an event which does not materially diminish the value of
Mortgagee's interest in the Trust Estate shall not be deemed an "impairment of
security," as that phrase is used in this TCHI Note Guarantee Mortgage.
Section 1.16. TCHI Note Guarantee Mortgage Deemed to be Security Agreement.
To the extent that the grant of a security interest in any portion of the
Trust Estate is governed by the Uniform Commercial Code, this TCHI Note
Guarantee Mortgage is hereby deemed to be as well a security agreement under the
Uniform Commercial Code for the purpose
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of creating hereby a security interest in all of Mortgagor's right, title and
interest in and to said property, securing the obligations secured hereby, for
the benefit of Mortgagee.
Section 1.17. No Duplication of Notices or Payments.
Whenever it is provided in this TCHI Note Guarantee Mortgage and the
Senior Partnership Upstream Note Mortgage that Mortgagor shall deliver any
notice or document, or is required to make any payment, the delivery of such
notice or document or the making of such payment shall constitute the delivery
of such notice or document or the making of such payment in satisfaction of the
terms, conditions and provisions of each of this TCHI Note Guarantee Mortgage
and the Senior Partnership Upstream Note Mortgage, provided that such notice,
document or payment states, or is accompanied by a letter stating, that such
notice, document or payment is being delivered in satisfaction of the terms,
conditions and provisions of this TCHI Note Guarantee Mortgage and the Senior
Partnership Upstream Note Mortgage.
ARTICLE TWO
RELEASE; SUBORDINATION
Section 2.1. Possession by Mortgagor.
So long as there shall have been no acceleration of maturity of the TCHI
Notes, Mortgagor shall be suffered and permitted, with power freely and without
let or hindrance on the part of Mortgagee, subject to the provisions of this
TCHI Note Guarantee Mortgage and the TCHI Note Indenture, to possess, use,
manage, operate and enjoy the Trust Estate and every part thereof and to
collect, receive, use, invest and dispose of the rents, issues, tolls, profits,
revenues and other income from the Trust Estate or any part thereof, to use,
consume and dispose of any consumable, goods, wares and merchandise in the
ordinary course of business of operating the Casino Hotel and to adjust and
settle all matters relating to choses in action, leases and contracts.
Section 2.2. Obsolete Property.
Mortgagor shall have the right, at any time and from time to time, unless
an Event of Default shall have occurred and be continuing, without any release
from or consent by Mortgagee:
(a) to sell or dispose of, free from the lien of this TCHI Note Guarantee
Mortgage, any Tangible Personal Property which, in its reasonable opinion, may
have become obsolete or unfit for use or which is no longer necessary in the
conduct of its businesses or the operation of the Trust Estate, and no purchaser
of any such property shall be bound to inquire into any question affecting
Mortgagor's right to sell or otherwise dispose of the same free from the lien of
this TCHI Note Guarantee Mortgage;
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(b) to alter, repair, replace, change the location or position of and add
to any Tangible Personal Property; provided, however, that no change shall be
made in the location of any such property subject to the lien of this TCHI Note
Guarantee Mortgage which would in any respect impair the security of this TCHI
Note Guarantee Mortgage upon such property; or
(c) to renew, extend, surrender, terminate, modify or amend any leases of
Tangible Personal Property, when, in Mortgagor's reasonable opinion, it is
prudent to do so.
Mortgagor shall retain any net cash proceeds received from the sale or
disposition of any Tangible Personal Property under Subsection (a) of this
Section 2.2, in the business of operating the Casino Hotel.
Mortgagee shall be under no responsibility or duty with respect to the
exercise of the rights of Mortgagor under this Section 2.2 or the application of
the proceeds of any sale or disposition of any Tangible Personal Property.
Mortgagee shall, from time to time, promptly execute any written
instrument in form satisfactory to Mortgagee to confirm the propriety of any
action taken by Mortgagor under this Section 2.2, upon receipt by Mortgagee of a
Mortgagor Request requesting the same, together with a Mortgagor's Certificate
stating that the action so to be confirmed was duly taken in conformity with
this Section 2.2, and that the execution of such written instrument is
appropriate to confirm the propriety of such action under this Section 2.2;
provided, that Mortgagee shall have no liability thereunder and all costs and
expenses (including, without limitation, reasonable attorneys' fees and
disbursements) shall be paid by Mortgagor.
Section 2.3. F,F&E Financing Agreements.
Notwithstanding any provision contained in this TCHI Note Guarantee
Mortgage or the TCHI Note Indenture to the contrary, if Mortgagor acquires
Tangible Personal Property and/or other items constituting operating assets
subject to any F,F&E Financing Agreement, or becomes the lessee under a lease
for any of the same and if the document evidencing such F,F&E Financing
Agreement prohibits subordinate liens or the provisions of any such lease
prohibits any assignment thereof by the lessee, and if any such prohibition is
customary with respect to similar transactions of the lender or lessor (as
evidenced by a Mortgagor's Certificate delivered to Mortgagee, together with
such other evidence as Mortgagee may reasonably request), as the case may be,
then the property so purchased or the lessee's interest in the lease, as the
case may be, shall be deemed to be Excepted Property. If any such F,F&E
Financing Agreement permits subordinate liens, then Mortgagee shall execute and
deliver to Mortgagor, at Mortgagor's expense, such documents as the holder of
such F,F&E Financing Agreement may reasonably request to evidence the
subordination of the lien of this TCHI Note Guarantee Mortgage and the Mortgage
Documents to the lien of such F,F&E Financing Agreement; provided, however, that
Mortgagee shall have no obligation to execute and deliver such documents, and
the lien of this TCHI Note Guarantee Mortgage shall not be subordinate to any
such F,F&E Financing Agreement, unless (a) such F,F&E Financing
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Agreement shall contain a provision binding upon the holder of such F,F&E
Financing Agreement that (i) if the holder of such F,F&E Financing Agreement
shall give to Mortgagor any notice of default thereunder, such holder shall at
the same time and in the same manner serve a copy of such notice on Mortgagee at
the address designated herein (or such other address as Mortgagee may designate
by notice given to the holder of such F,F&E Financing Agreement in the manner
provided for notices hereunder), and that no such notice to Mortgagor shall be
deemed to have been duly given unless and until a copy thereof has been so
provided to Mortgagee, and (ii) promptly following the last date upon which
Mortgagor may cure such default, if Mortgagor shall fail to cure such default,
the holder of such F,F&E Financing Agreement shall give notice to Mortgagee
stating the manner in which Mortgagor shall have failed to cure its said
default, in which event Mortgagee shall be permitted to cure the default and,
with respect thereto, Mortgagee shall have the same amount of time, after such
notice, within which to cure the said default, as is provided for under the
provisions of such F,F&E Financing Agreement to be given to Mortgagor therefor
after notice or (b) Mortgagor delivers to Mortgagee a Mortgagor's Certificate
certifying that (i) the provision described in clause (a) is not customarily
included by the lender or lessor in its F,F&E Financing Agreements in similar
transactions and (ii) although Mortgagor has used reasonable efforts to have
included in such F,F&E Financing Agreement such a provision, Mortgagor has been
unsuccessful in obtaining such a provision.
ARTICLE THREE
REMEDIES
Section 3.1. Events of Default.
"Event of Default," whenever used herein, means any one of the following
events (including any applicable notice requirement and any period of grace, as
specified in this Section 3.1) (whatever the reason for such event and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) default in the payment of any interest on the TCHI Notes or the Senior
Partnership Upstream Note when such interest becomes due and payable and
continuance of such default for a period of 30 days; or
(b) default in the payment of all or any portion of the principal of (or
premium, if any, on) the TCHI Notes or the Senior Partnership Upstream Note when
the same becomes due and payable at its Maturity; or
(c) default in the payment of any other sum due under the TCHI Notes or
this TCHI Note Guarantee Mortgage, and the continuance of such default for a
period of 30 days after there
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has been given to Mortgagor a notice specifying such default and requiring it to
be remedied and stating that such notice is a "Notice of Default" hereunder; or
(d) default in the payment or performance of any obligation under the
Senior Guarantee at the time such payment or performance is required under
Article Fourteen of the Senior Note Indenture; or
(e) default in the performance, or breach, of any covenant of Mortgagor in
this TCHI Note Guarantee Mortgage (other than a covenant, a default in the
performance or breach of which is elsewhere in this Section 3.1 specifically
dealt with), and continuance of such default or breach for a period of 30 days
after there has been given to Mortgagor a notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder, unless (i) the default or breach is of such a nature that
is curable but not susceptible of being cured with due diligence within such
30-day period (for reasons other than the lack of funds), (ii) Mortgagor
delivers a Mortgagor's Certificate to Mortgagee within such 30-day period
stating (A) the applicability of the provisions of clause (i) to such default or
breach, (B) Mortgagor's intention to remedy such default or breach with
reasonable diligence and (C) the steps which Mortgagor has undertaken or intends
to undertake to remedy such default or breach and (iii) Mortgagor delivers to
Mortgagee additional Mortgagor's Certificates every 30 days thereafter updating
the information contained in the certificate described in clause (ii), in which
case such 30-day period shall be extended for such further period of time (but
in no event more than 60 days after the last day of such 30-day period) as may
reasonably be required to cure the same, provided that Mortgagor is then
proceeding and thereafter continues to proceed to cure the same with reasonable
diligence; or
(f) an "Event of Default," as defined in Section 5.1 of the TCHI Note
Indenture, shall occur and be continuing; or
(g) default by Mortgagor under any of the terms of any Facility Lease
which shall not be fully cured or waived prior to the expiration of any grace
period (as such grace period may be extended) contained in such Facility Lease;
or
(h) default in the performance, or breach, of any of the provisions of
Article Four hereof; or
(i) if any representation or warranty of Mortgagor set forth in this TCHI
Note Guarantee Mortgage or in any notice, certificate, demand or request
delivered to Mortgagee pursuant to this TCHI Note Guarantee Mortgage shall prove
to be incorrect in any material respect as of the time when made; or
(j) an "Event of Default" as defined in Section 3.1 of the Senior Note
Mortgage, the Senior Guarantee Mortgage, the Senior Partnership Upstream Note
Mortgage or the Mortgage Documents shall occur and be continuing.
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An Event of Default shall not be deemed to exist by reason of any event
which Mortgagor is contesting in compliance with the provisions of Section 5.8.
Section 3.2. Acceleration of Maturity; Recision and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(g) or (h) of the TCHI Note Indenture) occurs and is continuing,
then, and in every such case, Mortgagee may declare the Outstanding Amount of
the TCHI Notes to be due and payable immediately, by a notice in writing to
Mortgagor and upon any such declaration such principal shall become immediately
due and payable. If an Event of Default specified in such Section 5.1(g) or (h)
occurs, the Outstanding Amount of the TCHI Notes shall ipso facto become due and
payable without any declaration or other act on the part of the Mortgagee.
If at any time after such declaration of acceleration has been made, but
before any judgment or decree for payment of money due on the TCHI Notes has
been obtained by the Mortgagee, such declaration of acceleration and its
consequences has been duly rescinded and annulled in accordance with Section 5.2
of the TCHI Note Indenture, then the declaration of acceleration pursuant to
this Section 3.2 shall automatically be rescinded and annulled.
No such rescission and annulment shall affect any subsequent default or
impair any right consequent thereon.
Section 3.3. Application of Moneys Received by Mortgagee.
Any moneys received by Mortgagee pursuant to the provisions of this
Article Three (including moneys received by the Trustee after any action or act
by Mortgagee under Section 3.10) shall be applied by Mortgagee in accordance
with the provisions of Section 5.6 of the TCHI Note Indenture.
Section 3.4. Restoration of Rights and Remedies.
If Mortgagee has instituted any proceeding to enforce any right or remedy
under this TCHI Note Guarantee Mortgage and such proceeding has been
discontinued or abandoned for any reason or has been determined adversely to
Mortgagee, then and in every such case Mortgagor and Mortgagee shall, subject to
any determination in such proceeding, be restored to their respective former
positions hereunder, and thereafter all rights and remedies of Mortgagee shall
continue as though no such proceeding had been instituted.
Section 3.5. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to Mortgagee is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted
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by law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
Section 3.6. Delay or Omission Not Waiver.
No delay or omission of Mortgagee to exercise any right or remedy accruing
upon an Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right and
remedy given by this Article Three or by applicable law to Mortgagee may be
exercised, from time to time, and as often as may be deemed expedient, by
Mortgagee.
Section 3.7. Undertaking for Costs.
If any action or proceeding shall be commenced (including, without
limitation, an action to foreclose this TCHI Note Guarantee Mortgage or to
collect the indebtedness secured hereby) to which action or proceeding Mortgagee
is made or becomes a party, or in which it becomes necessary in the opinion of
Mortgagee to defend or uphold the lien of this TCHI Note Guarantee Mortgage,
Mortgagor shall pay to Mortgagee all expenses, including, without limitation,
reasonable attorneys' fees, disbursements and court costs incurred by Mortgagee
in connection therewith, together with interest at the rate then payable on the
TCHI Notes, from the date of payment less the net amount received by Mortgagee,
as its interests may appear under any title insurance policy, and, until paid,
all such expenses, together with interest as aforesaid, shall be secured by the
lien of this TCHI Note Guarantee Mortgage.
Section 3.8. Waiver of Appraisement and Other Laws.
To the full extent that it may lawfully so agree, Mortgagor will not at
any time insist upon, plead, claim or take the benefit or advantage of, any
appraisement, valuation, stay, extension or redemption law now or hereafter in
force, in order to prevent or hinder the enforcement of this TCHI Note Guarantee
Mortgage or the absolute sale of the Trust Estate, or any part thereof, or the
possession thereof by any purchaser at any sale under this Article Three; and
Mortgagor, for itself and all who may claim under Mortgagor, so far as Mortgagor
or they now or hereafter may lawfully do so, hereby waives the benefit of all
such laws. Mortgagor, for itself and all who may claim under Mortgagor, waives,
to the extent that Mortgagor may lawfully do so, all right to have the property
in the Trust Estate marshaled upon any foreclosure hereof, and agrees that any
court having jurisdiction to foreclose this TCHI Note Guarantee Mortgage may
order the sale of the Trust Estate as an entirety.
If any law in this Section 3.8 referred to and now in force, of which
Mortgagor or its successor or successors might take advantage despite this
Section 3.8, shall hereafter be repealed
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or cease to be in force, such law shall not thereafter be deemed to constitute
any part of the contract herein contained or to preclude the application of this
Section 3.8.
Section 3.9. Entry.
Mortgagor agrees that upon the occurrence, and during the continuance, of
an Event of Default, Mortgagor, upon demand of Mortgagee, shall forthwith
surrender to Mortgagee the actual possession of, and it shall be lawful for
Mortgagee by such officers or agents as it may appoint to enter and take
possession of, the Trust Estate (and the books and papers of Mortgagor), and to
hold, operate and manage the Trust Estate (including the making of all needful
repairs, and such alterations, additions and improvements as Mortgagee shall
deem wise) and to receive the rents, issues, tolls, profits, revenues and other
income thereof, and, after deducting the costs and expenses of entering, taking
possession, holding, operating and managing the Trust Estate, as well as
payments for taxes, insurance and other proper charges upon the Trust Estate and
reasonable compensation to itself, its agents and counsel, to apply the same as
provided in Section 3.3; provided, however, that Mortgagee's rights under this
Section 3.9 shall be subject to the provisions of the New Jersey Casino Control
Act and Section 3.14. Whenever all that is then due upon the Senior Notes and
under any of the terms of the Senior Guarantee, this TCHI Note Guarantee
Mortgage shall have been paid and all defaults hereunder shall have been cured,
Mortgagee shall surrender possession to Mortgagor.
Section 3.10. Power of Sale; Suits for Enforcement.
If an Event of Default shall occur and be continuing, Mortgagee, with or
without entry, in its discretion, may:
(a) sell, subject to any mandatory requirements of applicable law, the
Trust Estate as an entirety, or in such parcels, as Mortgagee may determine, to
the highest bidder at public auction at such place and at such time (which sale
may be adjourned by Mortgagee from time to time in its discretion by
announcement at the time and place fixed for such sale, without further notice)
and upon such terms as Mortgagee may fix and briefly specify in a notice of sale
to be published as required by law; or
(b) proceed to protect and enforce its rights under this TCHI Note
Guarantee Mortgage by sale pursuant to judicial proceedings or by a suit, action
or proceeding in equity or at law or otherwise, whether for the specific
performance of any covenant or agreement contained in this TCHI Note Guarantee
Mortgage or in aid of the execution of any power granted in this TCHI Note
Guarantee Mortgage or for the foreclosure of this TCHI Note Guarantee Mortgage
or for the enforcement of any other legal, equitable or other remedy, as
Mortgagee shall deem most effectual to protect and enforce any of the rights of
Mortgagee; the failure to join tenants shall not be asserted as a defense to any
foreclosure or proceeding to enforce the rights of Mortgagee.
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Section 3.11. Incidents of Sale.
Upon any sale of any of the Trust Estate, whether made under the power of
sale hereby given or pursuant to judicial proceedings, to the extent permitted
by law:
(a) the principal of and accrued interest on the TCHI Notes, if not
previously due, shall at once become and be immediately due and payable;
(b) subject to the provisions of Section 3.14 and the receipt of any
required prior approvals of the New Jersey Casino Control Commission, Mortgagee
may bid for and purchase the property offered for sale, and upon compliance with
the terms of sale may hold, retain, possess and dispose of such property,
without further accountability, and may, in paying the purchase money therefor,
deliver the TCHI Notes or claims for interest thereon in lieu of cash to the
amount which shall, upon distribution of the net proceeds of such sale, be
payable thereon, and the TCHI Notes, in case the amounts so payable thereon
shall be less than the amount due thereon, shall be returned to Mortgagee after
being appropriately stamped to show the partial payment;
(c) Mortgagee may make and deliver to the purchaser or purchasers a good
and sufficient deed, bill of sale and instrument of assignment and transfer of
the property sold;
(d) Mortgagee is hereby irrevocably appointed the true and lawful attorney
of Mortgagor, in its name and stead, to make all necessary deeds, bills of sale
and instruments of assignment and transfer of the property thus sold; and for
that purpose it may execute all necessary deeds, bills of sale and instruments
of assignment and transfer, and may substitute one or more persons, firms or
corporations with like power, Mortgagor hereby ratifying and confirming all that
its said attorney or such substitute or substitutes shall lawfully do by virtue
hereof; but if so requested by Mortgagee or by any purchaser, Mortgagor shall
ratify and confirm any such sale or transfer by executing and delivering to
Mortgagee or to such purchaser or purchasers all proper deeds, bills of sale,
instruments of assignment and transfer and releases as may be designated in any
such request;
(e) all right, title, interest, claim and demand whatsoever, either at law
or in equity or otherwise, of Mortgagor of, in and to the property so sold shall
be divested and such sale shall be a perpetual bar both at law and in equity
against Mortgagor, its successors and assigns, and against any and all persons
claiming or who may claim the property sold or any part thereof from, through or
under Mortgagor, its successors and assigns; and
(f) the receipt of Mortgagee or of the officer making such sale shall be a
sufficient discharge to the purchaser or purchasers at such sale for his or
their purchase money and such purchaser or purchasers and his or their assigns
or personal representatives shall not, after paying such purchase money and
receiving such receipt, be obliged to see to the application of such
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purchase money, or be in anywise answerable for any loss, misapplication or
non-application thereof.
Section 3.12. Receiver.
Upon the occurrence of an Event of Default and commencement of judicial
proceedings by Mortgagee to enforce any right under this TCHI Note Guarantee
Mortgage, Mortgagee shall be entitled, as against Mortgagor, without notice or
demand and without regard to the adequacy of the security for the TCHI Notes or
the solvency of Mortgagor, to the appointment of a receiver of the Trust Estate,
and of the rents, issues, profits, revenues and other income thereof; provided,
however, that Mortgagee's rights under this Section 3.12 shall be subject to the
provisions of the New Jersey Casino Control Act and Section 3.14 hereof.
Section 3.13. Suits to Protect the Trust Estate.
Mortgagor hereby acknowledges the right of Mortgagee, in the name and on
behalf of Mortgagor, (a) to appear in and defend any action or proceeding
brought with respect to the Trust Estate or any part thereof and (b) upon 5
days' prior notice to Mortgagor (or such shorter period or without notice if
deemed necessary and appropriate by Mortgagee), to institute and to maintain
such proceedings as Mortgagee may deem necessary and appropriate, but in the
case of (a) and (b) only to prevent any impairment of security or any impairment
of the Trust Estate by any acts which may be unlawful or in violation of this
TCHI Note Guarantee Mortgage and to protect Mortgagee's interests in the Trust
Estate and in the rents, issues, profits, revenues and other income arising
therefrom, including the right to institute and maintain proceedings to restrain
the enforcement of or compliance with any governmental enactment, rule or order
that may be unconstitutional or otherwise invalid, if the enforcement of or
compliance with such enactment, rule or order would impair the security
hereunder or be materially prejudicial to the interests of Mortgagee.
Section 3.14. Management of the Premises.
Without limiting the generality of any other provision of this Article
Three, following an Event of Default and the taking of possession of the Trust
Estate or any part thereof by Mortgagee and/or the appointment of a receiver of
the Trust Estate or any part thereof, Mortgagee or any such receiver shall be
authorized, in addition to the rights and powers of Mortgagee and such receiver
set forth elsewhere in this TCHI Note Guarantee Mortgage, to take any action
permitted under Section 5.17 of the TCHI Note Indenture.
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ARTICLE FOUR
CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE
Section 4.1. Consolidation, Merger, Conveyance or
Transfer only on Certain Terms.
Mortgagor shall comply with all provisions applicable to Mortgagor in
Article Eight of the TCHI Note Indenture.
Section 4.2. Successor Entity Substituted.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer or disposition of the Trust Estate or any portion thereof in accordance
with Section 8.1 of the TCHI Note Indenture (other than a lease), the successor
Person formed by such consolidation or into which Mortgagor is merged or the
successor Person to which such sale, assignment, conveyance, transfer or
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, Mortgagor under this TCHI Note Guarantee Mortgage with
the same effect as if such successor had been named as Mortgagor herein; and
thereafter, except in the case of a lease, the Person named as "Mortgagor" in
the first paragraph of this instrument or any successor Person which shall
theretofore have become such in the manner prescribed in this Article shall be
discharged from all obligations and covenants under this TCHI Note Guarantee
Mortgage.
ARTICLE FIVE
COVENANTS AND REPRESENTATIONS OF MORTGAGOR
Section 5.1. Performance of Senior Guarantee Obligations.
Mortgagor shall duly and punctually pay and perform its obligations under
the Senior Guarantee in accordance with the terms of the Senior Note Indenture
(including, without limitation, Article Fourteen thereof).
Section 5.2. F,F&E Financing Agreements.
Mortgagor shall comply with all of the terms and conditions set forth in
any F,F&E Financing Agreements before the expiration of any applicable notice
and cure periods contained in the F,F&E Financing Agreements.
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Section 5.3. Limitations on Liens and Transfers.
(a) Mortgagor shall not create, incur, suffer or permit to be created or
incurred or to exist any mortgage, lien, charge or encumbrance on or pledge of
any of the Trust Estate, other than (i) Permitted Encumbrances, (ii) a notice of
intention filed by a mechanic, materialman or laborer under the New Jersey
mechanic's lien law, and (iii) a building contract filed by a contractor or
subcontractor under the New Jersey mechanic's lien law. Without limiting the
generality of the foregoing sentence but notwithstanding the provisions of the
foregoing sentence, Mortgagor shall not be deemed to have breached the
provisions of the foregoing sentence by virtue of the existence of a lien for
Impositions or mechanics' liens so long as Mortgagor is in good faith contesting
the validity of the same in accordance with the provisions of Section 5.8.
(b) The lien of this TCHI Note Guarantee Mortgage on the date hereof shall
be superior, and not subordinate to the lien of any Permitted Encumbrances
(except for items 1, 2, 3, 4 and 11 contained in the definition of Permitted
Encumbrances) to the extent that each thereof encumbers Mortgagor's interest in
the Trust Estate or any part thereof. Mortgagor shall from time to time after
receipt of a request of Mortgagee or the Trustee obtain instruments in form and
substance reasonably satisfactory to Mortgagee or Trustee, as the case may be,
confirming the senior lien priority of this TCHI Note Guarantee Mortgage over
the lien of any such Permitted Encumbrances.
(c) Except as otherwise expressly permitted under this TCHI Note Guarantee
Mortgage and the TCHI Note Indenture (including, without limitation, Article
Eight of the TCHI Note Indenture), Mortgagor shall not sell, assign, lease or
otherwise transfer all or any portion of the Trust Estate or any interest
therein. Notwithstanding the foregoing, Mortgagor shall have the right, at any
time and from time to time, unless an Event of Default shall have occurred and
be continuing, without any release from or consent by Mortgagee, to grant
interests in the Owned Land in the nature of rights-of-way or easements, or
other rights or privileges in the nature of easements; provided, (i) that none
of the same will reduce or impair, in any material respect, (A) the value or
usefulness of the Trust Estate or any part thereof or (B) the normal operation
of the Casino Hotel in accordance with all Legal Requirements and all Permits,
(ii) Mortgagor has delivered to Mortgagee a Mortgagor's Certificate, dated not
earlier than 10 days prior to the date of each such grant, certifying that (A)
no Event of Default has occurred and is continuing and (B) the conditions set
forth in this Section 5.3(c) for such grant have been fulfilled and (iii)
Mortgagor has delivered to Mortgagee a duplicate original of the instrument, if
any, pursuant to which such grant is to be made, and such other instruments,
certificates and opinions as Mortgagee may reasonably request. The foregoing
provisions of this Section 5.3(c) shall be self-operative and no further
instrument shall be required to evidence the consent of Mortgagee to the grant
or other conveyance of such rights-of-way or easements. Mortgagee shall,
however, from time to time, after receipt of a Mortgagor Request therefor
(accompanied by a Mortgagor's Certificate stating that said conditions have been
satisfied) execute instruments in form and
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substance reasonably satisfactory to Mortgagee confirming the permissibility of
such grant or other conveyance.
Section 5.4. Environmental.
Without limiting the generality of any other provision of this TCHI Note
Guarantee Mortgage, Mortgagor covenants, represents and warrants to Mortgagee as
follows:
(a) Mortgagor shall comply with any and all federal, state and local
environmental legislation, rules, and regulations in effect as of the date of
this TCHI Note Guarantee Mortgage and subsequent thereto, including, without
limitation, the Spill Compensation and Control Act (N.J.S.A. 58:10-23. 11 et
seq.) (the"Spill Act"); the Industrial Site Recovery Act (N.J.S.A. 13:1K-6 et
seq.) ("ISRA"); the Solid Waste Management Act (N.J.S.A. 13:E-1 et seq.); the
Resource, Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.)
("RCRA"); the Comprehensive Environmental Response, Compensation and Liability
Act (42 U.S.C. Section 9601 et seq.) ("CERCLA") and such other environmental
legislation, rules and regulations, as are in or may come into effect and apply
to (i) Mortgagor and/or Mortgagee with respect to the Premises or (ii) the
transactions contemplated hereby, and as to any occupants or users of the
collateral, whether as lessees, tenants, licensees or otherwise, Mortgagor shall
use its best efforts to cause same to comply with said legislation, rules and
regulations. Mortgagor agrees to pay all costs required in connection with
compliance with the foregoing legislation, rules and regulations.
(b) Mortgagor has not used in the past, nor shall Mortgagor use in the
future, the Premises for the purpose of refining, producing, storing, handling,
transferring, processing or transporting "Hazardous Substances", as such term is
defined in ISRA, the Spill Act, CERCLA or the regulations relating thereto,
except that Mortgagor and its subsidiaries have used, and Mortgagor may continue
in the future to use, substances in the operation and maintenance of the
Premises, including, without limitation, heating oil, gasoline and cleaning
chemicals which could be considered as "Hazardous Substances" under the
preceding definition.
(c) To the best of Mortgagor's knowledge, after due inquiry and
investigation, none of the real property owned, leased and/or occupied by
Mortgagor and located in the State of New Jersey, including, without limitation,
the Premises, has been or is now being used as a "Major Facility" as such term
is defined in N.J.S.A. 58:10-23.11b(1). Mortgagor will not use the Premises in
the future as a "Major Facility".
(d) To the best of Mortgagor's knowledge, after due inquiry and
investigation, no lien has been attached to any revenues or any real or personal
property owned by Mortgagor or the Premises, as a result of the Chief Executive
of the New Jersey Spill Compensation Fund expending monies from said fund to pay
for "Cleanup Costs", as such term is defined in N.J.S.A. 58:10-23.11b(d),
arising from an intentional or unintentional action or omission of Mortgagor or
any previous owner and/or operator of such real property.
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(e) There is no asbestos or asbestos containing material on the Premises.
To the best of Mortgagor's knowledge, there are no underground storage tanks
located at the Premises, other than those tanks previously disclosed to
Mortgagee and which are maintained in accordance with all material Legal
Requirements. Mortgagor has not installed or placed, or permitted to be
installed or placed, any underground storage tanks at or on the Premises, other
than those tanks previously disclosed to Mortgagee and which are maintained in
accordance with all material Legal Requirements. Underground storage tanks shall
have the definition as set forth in N.J.S.A. 58:10A-22(p).
(f) Mortgagor has not received a summons, citation, directive, letter,
other written communication, or, to the best of its knowledge, any oral
communication, from the New Jersey Department of Environmental Protection and
Energy or from any other person, firm or corporation concerning any intentional
or unintentional action or omission on Mortgagor's part resulting in the
releasing, spilling, leaking, pumping, pouring, emitting, emptying or dumping of
"Hazardous Substances", as such term is defined in N.J.S.A. 58:10-23.11b(k),
into the waters or onto the lands of the State of New Jersey, or into the waters
outside the jurisdiction of the State of New Jersey, in either case resulting in
damage to the lands, waters, fish, shellfish, wildlife, biota, air and other
resources owned, managed, held in trust or otherwise controlled by the State of
New Jersey.
(g) In connection with any purchase of the Premises or any business or
assets located thereon or any "closing, terminating or transferring operations"
of any "industrial establishment", as that term is defined in ISRA, occurring on
or after December 31, 1983, Mortgagor required that the owner and or operator of
the industrial establishment comply with the provisions of ECRA and the owner
and or operator did comply therewith.
(h) Upon the occurrence of an Event (as hereinafter defined), Mortgagee
shall have the right to have its consultants perform a comprehensive
environmental audit of the Premises. Such audit shall be conducted by an
environmental consultant chosen by Mortgagee and may include a visual survey, a
record review, an area reconnaissance assessing the presence of hazardous or
toxic waste or substances, PCBs or storage tanks at the Premises, an asbestos
survey of the Premises, which may include random sampling of the improvements
and air quality testing, and such further site assessments as Mortgagee may
reasonably require due to the results obtained from the foregoing. Mortgagor
grants Mortgagee, its agents, consultants and contractors the right to enter the
Premises for the purposes of performing such studies and the cost of such
studies shall be due and payable by Mortgagor to Mortgagee upon demand and shall
be secured by the lien of this TCHI Note Guarantee Mortgage. Mortgagee shall
direct the environmental consultant to use its best efforts not to hinder
Mortgagor's or any tenant's operations when conducting such audit, sampling or
inspections. For purposes of this paragraph, the term "Event" shall mean (i) the
occurrence of any Event of Default, (ii) the issuance of any summons, citation,
directive or similar written notice from the New Jersey Department of
Environmental Protection and Energy or from any other local, state or federal
entity or from any other person, firm or corporation concerning any alleged
material violation of any and all federal,
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state and local environmental legislation, rules and regulations in effect as of
the date of this TCHI Note Guarantee Mortgage and subsequent thereto or (iii)
the initiation of any legal action, suits or other legal or administrative
proceedings relating to or in connection with any alleged violation of any and
all federal, state and local environmental legislation, rules and regulations in
effect as of the date of this TCHI Note Guarantee Mortgage and subsequent
thereto.
(i) If a lien shall be filed against the Premises by the New Jersey
Department of Environmental Protection and Energy, pursuant to and in accordance
with the provisions of N.J.S.A. 58:10-23.11f(f), as a result of the Chief
Executive of the New Jersey Spill Compensation Fund having expended monies from
said fund to pay for "Damages", as such term is defined in N.J.S.A.
58:10-23.11g, and/or "Cleanup and Removal-Costs", as such term is defined in
N.J.S.A. 58:10-23(b), arising from an intentional or unintentional action or
omission of Mortgagor resulting in the releasing, spilling, pumping, pouring,
emitting, emptying or dumping of "Hazardous Substances", as such term is defined
in N.J.S.A. 58:10-23.11(b)k into waters of the State of New Jersey or onto lands
from which it might flow or drain into said waters, then, unless there is a good
faith basis for contesting such lien and Mortgagor is so contesting such lien in
accordance with Section 5.8, Mortgagor shall, within 30 days from the date that
Mortgagor is given notice that the lien has been placed against the Premises or
within such shorter period of time if the State of New Jersey has commenced
steps to cause the Premises to be sold pursuant to the lien, either (i) pay the
claim and remove the lien from the Premises, or (ii) furnish (A) a bond
satisfactory to a title company selected by Mortgagee (the "Title Insurer") in
the amount of the claim out of which the lien arises, (B) to the Trustee, a cash
deposit (which may be disbursed by the Trustee in its sole discretion) in the
amount of the claim out of which the lien arises, or (C) other security
reasonably satisfactory to Mortgagee in an amount sufficient to discharge the
claim out of which the lien arises.
(j) Mortgagor shall use its best efforts to cause compliance by all
lessees with all applicable Legal Requirements relating to environmental
protection.
(k) Mortgagor shall promptly provide Mortgagee with copies of all notices
received by or prepared by Mortgagor in connection with ISRA, CERCLA, the Spill
Act, RCRA or any other environmental law, rule or regulation relating to the
Premises. For purposes of this paragraph, the term "notice" shall mean any
summons, citation, directive, order, claim, pleading, letter, application,
filing, report, findings, declarations or other materials pertinent to
compliance of the Trust Estate and Mortgagor with such environmental laws, rules
or regulations.
(l) If this TCHI Note Guarantee Mortgage is foreclosed, Mortgagor shall
deliver the Premises in compliance with all applicable federal, state and local
environmental laws, ordinances, rules and regulations, including, without
limitation, ISRA.
(m) Without limiting the generality of Section 5.19, Mortgagor agrees to
defend, indemnify and save Mortgagee harmless from and against any loss or
liability, cost or expense (including, without limitation, reasonable attorneys'
fees, consultants' fees, disbursements and
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court costs) arising out of, or incurred in connection with, Mortgagor's
misrepresentation, or failure promptly (but in no event to exceed the time
period permitted by law) to comply with and perform its obligations, under this
Section 5.4. The provisions of this subsection (m) shall survive any transfer of
the Premises, including a transfer after a foreclosure of this TCHI Note
Guarantee Mortgage.
Section 5.5. Warranty of Leasehold Estate and Title.
Mortgagor represents and warrants that as of the date hereof:
(a) Mortgagor is duly authorized under the laws of the State of New Jersey
and all other applicable laws to execute and deliver this TCHI Note Guarantee
Mortgage, and all partnership action on Mortgagor's part necessary for the valid
execution and delivery of this TCHI Note Guarantee Mortgage has been duly and
effectively taken;
(b) Mortgagor is the lawful owner and is lawfully seized and possessed of
the Owned Land and all buildings and improvements thereon, free and clear of all
liens, charges or encumbrances, other than the Mortgages, the Mortgage Documents
and the Existing Encumbrances;
(c) Mortgagor is the holder of and has good and marketable title to the
leasehold interests and leasehold estates under all existing Facility Leases,
subject to no lien, encumbrance or charge other than the Mortgages, the Mortgage
Documents and Existing Encumbrances;
(d) (i) each existing Facility Lease is a valid and subsisting demise of
the respective Leased Land for the term therein set forth, (ii) there are no
defaults under any Facility Lease by any lessor or the lessee as to which
written notice has been given to or by the lessee, (iii) Mortgagor has delivered
to Mortgagee and the Trustee a true and correct copy of each existing Facility
Lease, and all modifications, amendments and supplements thereto, and (iv) each
existing Facility Lease is in full force and effect and has not been modified,
amended or supplemented, except as described on Schedule 3;
(e) Mortgagor has good title to the Operating Assets, subject to no lien,
encumbrance or charge, other than Existing Encumbrances;
(f) Mortgagor has good and lawful right and authority to execute this TCHI
Note Guarantee Mortgage and to grant, bargain, sell, alien, convey, assign,
transfer, hypothecate, pledge, mortgage and confirm the Trust Estate as provided
herein (including, without limitation, with respect to the Operating Assets and
Facility Leases), without the consent of any third party, other than
governmental authorities and other secured Persons but any applicable or
necessary consent or approval of any such governmental authority and other such
Persons has been given or waived in accordance with applicable law at or prior
to the execution and delivery of this TCHI Note Guarantee Mortgage, and this
TCHI Note Guarantee Mortgage constitutes a valid
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first mortgage lien and deed of trust and first priority security interest in
the Trust Estate, subject only to the Existing Encumbrances and the pari passu
liens of the Senior Note Mortgage, the Senior Guarantee Mortgage and the Senior
Partnership Upstream Note Mortgage;
(g) (i) all amounts due under the Mortgage Documents and the instruments
securing such amounts have been paid to the extent they were due and payable to
the date hereof, and (ii) there is no existing default under said Mortgage
Documents or instruments, or in the performance of any of the terms, covenants,
conditions or warranties therein on the part of Mortgagor to be performed and
observed thereunder as to which written notice has been given to Mortgagor; and
(h) Mortgagor hereby does and shall forever warrant and defend (a) the
title to the Trust Estate (including, without limitation, Mortgagor's leasehold
estate under, and the lessee's interests in, each existing Facility Lease)
(subject to items 1 and 3 listed on Schedule 3) and (b) the pari passu liens of
the Mortgages thereon (subject to items 1 and 3 listed on Schedule 3), against
the claims and demands of all persons whomsoever, at Mortgagor's sole cost and
expense.
Section 5.6. After-Acquired Property; Further Assurances; Recording.
All property, real, personal or mixed or any interest therein (other than
Excepted Property), of every kind and description and wheresoever situate, which
may be hereafter acquired by Mortgagor (including, without limitation, fee title
to any Leased Land) shall immediately upon the acquisition thereof by Mortgagor,
and without any further mortgage, conveyance or assignment, become subject to
the lien of this TCHI Note Guarantee Mortgage as fully as though now owned by
Mortgagor and covered by the Granting Clauses. Nevertheless, Mortgagor shall do,
execute, acknowledge and deliver all and every such further acts, conveyances,
mortgages, financing statements and assurances as Mortgagee shall require for
accomplishing the express purposes of this TCHI Note Guarantee Mortgage.
Mortgagor shall, as provided in Section 5.12, from time to time subject to
the lien of this TCHI Note Guarantee Mortgage its right, title and interest
under all Leases.
Mortgagor shall use reasonable efforts to insure that all Operating Assets
(other than Excepted Property) or any interest therein hereafter acquired by
Mortgagor shall be assignable to Mortgagee, and to the extent such assignment to
Mortgagee requires the consent of any governmental authority or any other
Person, Mortgagor shall use reasonable efforts to obtain such consent or a
waiver thereof.
Mortgagor shall cause this instrument and all other instruments of further
assurance, including all financing statements and continuation statements
covering security interests in personal property, to be promptly recorded,
registered and filed, and at all times to be kept recorded, registered and
filed, and shall execute and file such financing statements and cause to be
issued and filed such continuation statements, all in such manner and in such
places as may be
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required by law or as requested by Mortgagee to fully preserve and protect the
rights of Mortgagee as a secured party under the Uniform Commercial Code to all
property comprising the Trust Estate (to the extent a grant of a security
interest therein is governed by the Uniform Commercial Code) and to perfect,
preserve and protect the lien of this TCHI Note Guarantee Mortgage as a valid
direct first mortgage lien of record and a valid first priority security
interest on the Trust Estate, subject only to Permitted Encumbrances.
Mortgagor shall pay all filing or recording fees, and all expenses
incident to the execution and delivery of this TCHI Note Guarantee Mortgage, any
financing statement or continuation statement with respect to the personal
property constituting part of the Trust Estate, and any instrument of further
assurance, and all federal, state, county and municipal stamp taxes and other
taxes, duties, imposts, assessments and charges arising out of or in connection
with the execution and delivery of the Associates Note, this TCHI Note Guarantee
Mortgage, any financing statement or continuation statement with respect to the
personal property constituting part of the Trust Estate or any instrument of
further assurance.
Mortgagor shall furnish to Mortgagee promptly after the acquisition
hereafter by Mortgagor of any fee interest or leasehold interest in real
property having a fair market value exceeding $500,000 (other than Excepted
Property), (a) a mortgagee policy of title insurance on the most recent form of
American Land Title Association standard loan policy, extended coverage, which
policy shall (i) contain all such endorsements and affirmative insurance, to the
extent reasonably applicable, as is contained in the Original Policy and (ii)
evidence that title to such real property is subject to no liens or encumbrances
(other than Permitted Encumbrances) which would (A) render title unmarketable or
(B) violate any other provision of this TCHI Note Guarantee Mortgage or the TCHI
Note Indenture, (b) an as-built survey meeting the "Minimum Standard Detail
Requirements for ALTA/ACSM Land Title Surveys", certified within 60 days prior
to the acquisition date by a surveyor licensed in the State of New Jersey using
the same form of certification as that contained in the surveys of the Premises
delivered to the Trustee on the date of this TCHI Note Guarantee Mortgage and
(c) a Mortgagor's Certificate certifying that the mortgagee policy of title
insurance and survey delivered pursuant to clauses (a) and (b) comply,
respectively, with the provisions of such clauses (a) and (b). Upon delivery of
all of the items required under this paragraph, any liens or encumbrances on
such real property shall constitute Permitted Encumbrances hereunder.
Section 5.7. Payment of Taxes and Certain Claims; Maintenance of Properties;
Compliance with Legal Requirements and Insurance Requirements.
Mortgagor shall:
(a) subject to the provisions of Section 5.8, pay or cause to be paid
before the date on which any fine, penalty, interest or cost may be added for
nonpayment (but no later than when the same are payable by Mortgagor pursuant to
any Superior Instrument Requirement), all taxes
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(including, without limitation, real estate taxes, personal or other property
taxes and all sales, value added, use and similar taxes), assessments
(including, without limitation, all assessments for public improvements or
benefits, whether or not commenced or completed prior to the date hereof and
whether or not to be completed prior to the satisfaction of this TCHI Note
Guarantee Mortgage), water, sewer or other rents, rates and charges, excises,
levies, license fees, permit fees, inspection fees and other authorization fees
and other charges, in each case whether general or special, ordinary or
extraordinary, foreseen or unforeseen, of every character (including, without
limitation, all interest, additions to tax and penalties thereon), that may be
assessed, levied, confirmed or imposed on or in respect of or be a lien upon (i)
the Trust Estate (including, without limitation, the Leased Land) or any part
thereof or any rent therefrom or any estate right or interest therein, or (ii)
any acquisition, occupancy, use, leasing, or possession of or activity conducted
on the real property or any part thereof included in the Trust Estate or any
gross receipts thereof or of the rent therefrom (all of the foregoing being
referred to collectively as "Impositions"). Notwithstanding the foregoing or any
other provision of this TCHI Note Guarantee Mortgage, Mortgagor shall not be
required to pay any income, profits or revenue tax upon the income of Mortgagee,
the Trustee or the Holders nor any franchise, excise, corporate, estate,
inheritance, succession, capital levy or transfer tax of Mortgagee, the Trustee
or the Holders nor any interest, additions to tax or penalties in respect
thereof, unless such tax is imposed, levied or assessed in substitution for any
Imposition that Mortgagor is required to pay pursuant to this Section 5.7.
Mortgagor shall deliver to Mortgagee, at Mortgagee's request, official receipts
or other proof evidencing payments of any Impositions in accordance with the
requirements of this Section 5.7. Mortgagor shall not be entitled to any credit
for taxes or assessments paid against the TCHI Notes;
(b) except for such obsolete property as Mortgagor may dispose of or
replace pursuant to Section 2.2, maintain and keep all of Mortgagor's properties
used or useful in the conduct of Mortgagor's business, including, without
limitation, the Casino Hotel and all Tangible Personal Property, in such good
repair, working order and condition, except for reasonable wear and use, and
make or cause to be made all such needful and proper repairs, renewals and
replacements thereto consistent with the standards of first-class casino and
hotel complexes in Atlantic City, New Jersey;
(c) occupy and continuously operate the Casino Hotel and keep the Casino
Hotel supplied with Tangible Personal Property, all in a manner consistent with
the standards of first-class casino and hotel complexes in Atlantic City, New
Jersey;
(d) subject to the provisions of Section 5.8, (i) comply with all Legal
Requirements and Insurance Requirements, whether or not compliance therewith
shall require structural changes in the buildings and improvements included in
the Trust Estate or interfere with the use and enjoyment of the Trust Estate or
any part thereof, (ii) procure, maintain and comply with all Permits required
for (1) the use of the Casino as a gaming and gambling facility, (2) the
on-premises consumption of alcoholic beverages at the Casino Hotel and (3) any
other use of the Trust Estate or any part thereof then being made, and for the
proper erection, installation,
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operation and maintenance of the improvements or any part thereof, (iii) comply
with all obligations of Mortgagor under, and keep in full force and effect, all
easements which in any respect inure to the benefit of, or otherwise affect, the
Trust Estate or any part thereof, if the failure to comply with the same would
impair Mortgagee's security hereunder, and (iv) without limiting the generality
of clause (iii), comply with any instruments of record at the time in force
affecting the Trust Estate or any part thereof, if the failure to comply with
the same would impair Mortgagee's security hereunder. Without limiting the
generality of the foregoing, Mortgagor represents and warrants that at the time
of the execution of this TCHI Note Guarantee Mortgage, Mortgagor is in
compliance with the requirements of clauses (i), (ii), (iii) and (iv) above; and
(e) in the event of the passage after the date of this TCHI Note Guarantee
Mortgage of any law of the State of New Jersey, or any other governmental
entity, changing in any way the laws now in force for the taxation of mortgages,
or debts secured thereby, for federal, state or local purposes, or the manner of
the operation of any such taxes, so as to affect the interest of Mortgagee, pay
the full amount of such new or additional taxes.
Section 5.8. Permitted Contests.
Notwithstanding anything in this TCHI Note Guarantee Mortgage to the
contrary, Mortgagor, at Mortgagor's expense, may contest (after prior notice to
Mortgagee) by appropriate legal proceedings conducted in good faith and with due
diligence, the amount or validity or application, in whole or in part, of any
Imposition or lien therefor or any Legal Requirement or Insurance Requirement or
the application of any instrument of record (including, without limitation, any
Superior Instrument Requirement) affecting the Trust Estate or any part thereof
or any claims of holders of F,F&E Financing Agreements, mechanics, materialmen,
suppliers, or vendors or lien therefor, and may withhold payment of the same
pending such proceedings if permitted by law, or make payment under protest, or
defer compliance with any such Legal Requirement, any such Insurance Requirement
or the terms of any such instrument, and the same shall not be a Default
hereunder; provided, that (a) in the case of any Impositions or lien therefor or
any claims of mechanics, materialmen, suppliers or vendors or lien therefor,
such proceedings shall suspend the collection thereof from each of Mortgagor,
Mortgagee, the Trustee, the Holders and the Trust Estate, (b) neither the Trust
Estate nor any interest therein would be in any significant danger of being
sold, forfeited, or lost, (c) such action will not result in the termination of
any Facility Lease, (d) in the case of a Legal Requirement, neither the Holders
nor Mortgagee shall be in any significant danger of any civil liability or any
danger of any criminal liability, and the failure of Mortgagor to comply with
such Legal Requirement shall not affect the continuance in good standing of any
Permit or result in the suspension, termination, non-renewal or material adverse
modification of any Permit, and (e) in the case of an Insurance Requirement, the
failure of Mortgagor to comply therewith shall not affect the validity of any
insurance required to be maintained by Mortgagor hereunder.
Section 5.9. Mechanics' and Other Liens.
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Mortgagor shall cause to be removed, either by payment, or bonding or
otherwise, all claims and demands of mechanics, materialmen, laborers, and
others which, if unpaid, might result in, or permit the creation of, a lien on
the Premises and/or Trust Estate or any part thereof, or on the revenues, rents,
issues, income and profits arising therefrom and in general shall do or cause to
be done everything necessary so that the lien hereof shall be fully preserved,
at the cost of Mortgagor, without expense to Mortgagee.
Section 5.10. To Insure.
(a) Mortgagor, at Mortgagor's expense, shall maintain with Insurers:
(i) insurance with respect to Mortgagor's insurable properties
constituting a part of the Trust Estate against loss or damage by fire,
lightning, and other risks from time to time included under "all-risk"
policies and against loss or damage by sprinkler leakage, water damage,
collapse, malicious mischief and explosion in respect of any steam and
pressure boilers and similar apparatus located on such insurable
properties, in amounts at all times sufficient to prevent Mortgagor from
becoming a coinsurer within the terms of the applicable policies, but in
any event such insurance shall be maintained in not less than the greatest
of the following (the "Insurance Amount"): (A) 100% of the then Full
Insurable Value of such insurable properties, determined from time to time
(but not less frequently than once in any 36 calendar months), by an
Appraiser or Insurer, (B) the then Outstanding Amount of Mortgage Debt,
including the Senior Partnership Note, or (C) the amount required to be
maintained pursuant to the Superior Instrument Requirements;
(ii) war risk insurance as and when such insurance is obtainable
from the United States of America or any agency thereof as promptly as
reasonably practicable after the same becomes so obtainable, in an amount
not less than the Insurance Amount, or, if such insurance cannot be
obtained in an amount not less than the Insurance Amount, in such lesser
amount as may then be so obtainable;
(iii) comprehensive general liability insurance, including, without
limitation, blanket contractual liability coverage, broad form property
damage, independent contractor's coverage and personal injury coverage
against any and all claims arising out of or connected with the
possession, use, leasing, operation or condition of such insurable
properties, in an amount not less than $100,000,000 combined single limit
coverage for personal injury and property damage with respect to any one
occurrence, which may be under an umbrella policy. Anything contained in
this clause (iii) to the contrary notwithstanding, the Superior Instrument
Requirements with respect to the kinds and amount of insurance described
in this clause (iii) shall be satisfied by Mortgagor;
(iv) workers' compensation insurance to the extent required by law;
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(v) business interruption insurance covering not less than 6 months
of loss, provided that, at any time that Mortgagor is renewing any policy
for such insurance or taking out any new or replacement policy for such
insurance covering a period of less than 12 months, Mortgagor shall
deliver to Mortgagee an Officers' Certificate certifying that the period
of coverage to be maintained by Mortgagor under such policy is the maximum
that can be maintained at rates determined by Mortgagor to be reasonable
for such coverage;
(vi) to the extent available, flood insurance in an amount not less
than the Insurance Amount, or, if such insurance cannot be obtained in an
amount not less than the Insurance Amount, such lesser amount as may then
be so obtainable but in no event less than $100,000,000; and
(vii) such other insurance with respect to such insurable properties
against loss or damage of the kinds (A) from time to time customarily
insured against by persons owning or using first-class casino and hotel
complexes in Atlantic City, New Jersey and (B) required to be maintained
pursuant to any Superior Instrument Requirements.
Notwithstanding the foregoing, to the extent not violative of any Superior
Instrument Requirements, (A) Mortgagor may maintain a deductible with respect to
the insurance policies described in clauses (i), (ii), (vi) and (vii) in an
amount not to exceed $250,000, (B) Mortgagor may maintain a deductible with
respect to the insurance policies described in clause (iii) in an amount not to
exceed $500,000, and (C) Mortgagor may maintain a deductible with respect to the
insurance policies described in clause (v) in an amount not to exceed
$1,000,000.
(b) (i) Each policy of insurance maintained by Mortgagor pursuant to
Section 5.10(a) shall, (A) except in the case of workers' compensation
insurance, name Mortgagor as an insured and shall name as additional insurers
(1) Mortgagee and (2) to the extent required by the Superior Instrument
Requirements, the lessors under any Facility Leases, (B) provide that all
insurance proceeds for losses, except in the case of comprehensive general
liability insurance and workers' compensation insurance or as otherwise provided
in Subsections (d), (e) and (f) of this Section 5.10, be payable solely to
Mortgagee, (C) include effective waivers (whether under the terms of any such
policy or otherwise) by the insurer of all claims for insurance premiums against
all loss payees and named insurers (other than Mortgagor) and all rights of
subrogation against any named insured, (D) except in the case of comprehensive
general liability and workers' compensation insurance, provide that any losses
shall be payable notwithstanding (1) any act, failure to act, negligence of, or
violation or breach of warranties, declarations or conditions contained in such
policy by Mortgagor or Mortgagee or any other named insured or loss payee
(including, without limitation, the lessors under the Facility Leases with
respect to any Leased Facilities), (2) the occupation or use of the insurable
properties for purposes more hazardous than permitted by the terms of the
policy, (3) any foreclosure or other proceeding or notice of sale relating to
the insurable properties or (4) any change in the title to or ownership or
possession of the insurable properties, (E) contain a non-contributory mortgagee
clause in favor of Mortgagee,
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and (F) provide that if all or any part of such policy is canceled, terminated
or expires, the insurer will forthwith give notice thereof to each named insured
and loss payee and that no cancellation, non-renewal, reduction in amount or
material change in coverage thereof shall be effective until at least 30 days
after receipt by each named insured and loss payee of written notice thereof.
(ii) Mortgagor may effect the insurance required under this Section 5.10
under blanket and/or umbrella policies covering properties owned or leased by
Affiliates of Mortgagor; provided, that (A) such policies otherwise comply with
this TCHI Note Guarantee Mortgage, (B) except with respect to flood insurance
and earthquake insurance, provide that the amount of coverage afforded
thereunder with respect to the Trust Estate shall not be reduced by claims
thereunder against such other properties and (C) in the case of flood insurance
provide that the amount of coverage afforded thereunder with respect to the
Trust Estate shall not be reduced below $100,000,000 by reason of claims
thereunder against such other properties.
(c) Mortgagor shall deliver to Mortgagee duplicate originals of all
insurance policies that Mortgagor is required to maintain pursuant to this
Section 5.10. Mortgagee shall not be responsible for effecting or renewing any
insurance or for the responsibility or solvency of the insurers.
(d) Mortgagor shall give written notice to Mortgagee immediately upon
obtaining knowledge of any Casualty which (i) results in damage, loss or
destruction in an amount in excess of $5,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property or (ii)
pursuant to any Superior Instrument Requirement, would require the deposit of
insurance proceeds with the Insurance Trustee or action or proceeding with
respect thereto. Within 30 days after any Casualty which results in any damage,
loss or destruction in an amount in excess of $10,000,000 to any buildings or
improvements on the Premises and/or any Tangible Personal Property, Mortgagor
shall deliver to Mortgagee a certificate of an Architect stating whether, in
such Architect's opinion, applicable Legal Requirements permit the Restoration
of said buildings and improvements for the same uses and to the same size and
quality in all material respects, as existed immediately prior to the Casualty
(and if said certificate states that Legal Requirements do not permit such
Restoration, said certificate shall describe the manner closest approximating
such criteria to which the buildings and improvements could be so restored and
shall be accompanied by a Certificate Of Appraised Value dated not more than 10
days prior to delivery setting forth the Appraised Value immediately prior to
the Casualty and the estimated Appraised Value immediately after the
Restoration). If Mortgagor is required to deliver such Certificates of Appraised
Value and if based on such Certificates of Appraised Value immediately after
Restoration, (i) the aggregate Outstanding Amount of Indebtedness of the
Mortgagor, the Company or TCHI immediately after such Restoration shall exceed
the greater of (A) 80% of the Appraised Value immediately after such Restoration
or (B) the quotient of the Outstanding Amount of Indebtedness of the Mortgagor,
the Company or TCHI immediately prior to such Casualty divided by the Appraised
Value immediately prior to the Casualty multiplied by the Appraised Value
immediately after such Restoration, or (ii) applicable Legal Requirements do not
permit the Restoration of the
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Casino Hotel for use as a casino and hotel complex, then, in either of such
events, the proceeds of any insurance shall not be applied to Restoration but
shall instead be applied to the Senior Indebtedness to the extent of the then
Outstanding Amount of the TCHI Notes and any other interest or other sums due
hereunder or thereunder to be applied to the satisfaction of this TCHI Note
Guarantee Mortgage to the extent proceeds are available for such purpose and
provided that no additional sums are due to the trustees or the holders under
the Senior Notes, the Senior Note Indenture, the Senior Guarantee, the TCHI
Notes, the TCHI Note Indenture, the TCHI Guarantee or the Mortgage Documents,
the balance of any net insurance proceeds shall be paid to Mortgagor.
(e) Subject to the provisions of Subsection 5.10(d), if a Casualty occurs,
the following shall apply:
(i) If the cost of Restoration is less than $10,000,000, the net
insurance proceeds shall be paid by Mortgagee to Mortgagor.
(ii) If the cost of Restoration is $10,000,000 or more, the net
insurance proceeds shall be paid by Mortgagee to the Insurance Trustee.
(iii) Mortgagor shall commence with reasonable promptness under the
circumstances and thereafter with due diligence proceed to perform and
complete in a good and workmanlike manner the restoration, repair,
replacement or rebuilding of the damage or destruction resulting from the
Casualty (all such restoration, repair, replacement and rebuilding
following a Casualty or a Taking are referred to as "Restoration") in
accordance with the plans and specifications submitted to the Insurance
Trustee, in conformance with all Legal Requirements and Superior
Instrument Requirements, and in accordance with the further provisions of
this Subsection (e), regardless of the extent of any such Casualty and
whether or not net insurance proceeds, if any, shall be available or, if
available, shall be sufficient, for the purpose of the Restoration. All
Restoration work shall be performed in accordance with the applicable
provisions of Section 5.12 and in conformance with all Superior Instrument
Requirements, Legal Requirements and Insurance Requirements and, prior to
commencing any Restoration, Mortgagor shall obtain all Permits necessary
in connection therewith, and shall obtain, and keep in full force and
effect until the completion of such Restoration, such additional insurance
as the Insurance Trustee and Superior Instrument Requirements may require.
The plans and specifications for the Restoration shall be accompanied by a
Mortgagor's Certificate and an Opinion of Counsel to the effect that upon
the completion of the Restoration pursuant to the plans and
specifications, the Premises and all buildings and improvements thereon
will comply with all Superior Instrument Requirements, Legal Requirements
and Insurance Requirements.
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(iv) Any insurance proceeds which Mortgagor receives shall be held
by Mortgagor in trust for the purpose of paying the cost of the
Restoration, except as otherwise provided herein.
(v) Any net insurance proceeds that the Insurance Trustee holds
pursuant to this Subsection (e), shall be deposited in an interest-bearing
investment reasonably designated by Mortgagor (to the extent Mortgagor is
permitted to designate such investment under the Superior Instrument
Requirements) (and the interest thereon shall be added to such proceeds)
and shall be paid by the Insurance Trustee to reimburse Mortgagor for, or
to make payment for, the Restoration, after the Insurance Trustee deducts
therefrom the amount of any reasonable costs and expenses incurred in
connection with the performance of its obligations under this Section
5.10. The Insurance Trustee shall make such payments not more frequently
than once every 30 days upon the written request of Mortgagor (unless more
frequent payments are required by Superior Instrument Requirements), by
paying to Mortgagor or the persons named in the certificate described in
clause (vi) of this Subsection (e) the respective amounts stated in such
certificate from time to time as the Restoration progresses, provided
Mortgagor has complied with the requirements of this Subsection (e) and
such payment is permitted by any applicable Superior Instrument
Requirements. Mortgagor's request shall be accompanied by (A) the
certificate described in clause (vi) of this Subsection (e) and (B) a
title company or official search, or other evidence reasonably acceptable
to the Insurance Trustee, showing that there have not been filed with
respect to the Premises, any vendor's, contractor's, mechanic's, laborer's
or materialman's statutory or similar lien which has not been discharged
of record (or bonded against or secured by other security) or any other
encumbrance irrespective of its priority (other than Permitted
Encumbrances).
(vi) The certificate required by clause (v) of this Subsection (e)
shall (A) be a Mortgagor's Certificate, countersigned by the Architect in
charge of the Restoration with respect to the matters described in (1) and
(5) below, (B) be dated not more than 10 days prior to such request and
(C) set forth (in addition to any other requirements contained in any
applicable Superior Instrument Requirements) that:
(1) all of the Restoration theretofore performed is in
substantial compliance with the plans and specifications theretofore
submitted to the Insurance Trustee and in compliance with all
Superior Instrument Requirements, Legal Requirements and Insurance
Requirements;
(2) the sum then requested either has been paid by Mortgagor
or is justly due to contractors, subcontractors, materialmen,
engineers, architects or other persons who have rendered services or
furnished or contracted to deliver materials for the Restoration
therein specified, and the names and addresses of such persons, a
brief description of such services and materials and the several
amounts so paid or due to each of said persons in respect thereof;
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(3) no part of the amount requested has been or is the basis
in any previous or then pending request for the withdrawal of net
insurance proceeds, and that the sum then requested does not exceed
the value of the services and materials described in the
certificate;
(4) except for the amount, if any, stated pursuant to
subclause (2) of this clause (vi) in such certificate to be due for
services or materials, and except for amounts in dispute and/or
customary retainages, there is no outstanding indebtedness known to
the person signing such certificate, after due inquiry, which is
then due for labor, wages, materials, supplies or services in
connection with such Restoration; and
(5) the remaining cost, as estimated by the persons signing
such certificate, of the Restoration in order to complete the same
does not exceed the net insurance proceeds remaining in the hands of
Insurance Trustee after payment of the sum requested in such
certificate or if such estimated cost does exceed such insurance
proceeds such certificate shall state the amount of any such
deficiency. If the certificate states that such deficiency will
exist, Mortgagor shall deliver the amount of such deficiency in cash
or cash equivalent to the Insurance Trustee simultaneously with the
delivery of such certificate, which amount shall be deemed insurance
proceeds for purposes of this Section 5.10(e).
(vii) If net insurance proceeds shall be insufficient to pay the
entire cost of the Restoration, then, after completion of the Restoration,
Mortgagor shall pay the deficiency. If all or any part of the net
insurance proceeds are not used for the Restoration in accordance with
this Subsection (e) (because such proceeds exceed the amount required to
complete the Restoration), then upon completion of the Restoration in
accordance with this Subsection (e), such amount not so used, if held by
the Insurance Trustee, shall be paid to Mortgagor (if permitted by
Superior Instrument Requirements).
(f) Mortgagor shall not take out separate insurance, concurrent in form or
contributing in the event of loss with that required to be maintained pursuant
to this Section 5.10, unless the same is permitted by Superior Instrument
Requirements. Mortgagor shall immediately notify Mortgagee whenever any such
separate insurance is taken out and shall promptly deliver to Mortgagee a
duplicate original of the policy of such insurance, a copy thereof certified by
the insurer or a certificate thereof. Provided that no Event of Default has
occurred and is continuing, all net business interruption insurance proceeds
shall be paid to Mortgagor, to be segregated from the other funds of Mortgagor
and held in trust by Mortgagor for the following purposes and in the following
order of priority: (i) for the payment of Impositions and amounts due under the
Facility Leases, (ii) for debt service under the TCHI Notes for the estimated
period of Restoration (for purposes of this Subsection 5.10(f), interest and
principal payments due on any payment date under the Senior Partnership Note
will be deemed to accrue in equal daily installments beginning the day after the
immediately preceding payment date and ending on such
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payment date), and (iii) for any other expense incurred in connection with the
operation or business of the Casino Hotel.
(g) Insurance claims by reason of damage or destruction to any portion of
the Trust Estate may be adjusted by Mortgagor, but Mortgagee shall have the
right (but not the obligation) to join Mortgagor in adjusting, and approving the
adjustment of, any such loss except in the event of a loss where the amount of
insurance reasonably anticipated to be received with respect to such loss is
less than $5,000,000, and Mortgagor shall assist Mortgagee in any such
adjustment at the request of Mortgagee. If Mortgagee at its election as
aforesaid joins Mortgagor in any adjustment process, then Mortgagee's approval
of the adjustment shall not be unreasonably withheld.
(h) Notwithstanding anything contained herein to the contrary, if an Event
of Default shall have occurred and be continuing, Mortgagee may, at its option,
(A) refrain from paying to Mortgagor or the Insurance Trustee any net insurance
proceeds or (B) instruct the Insurance Trustee to pay to Mortgagee any insurance
proceeds then held by the Insurance Trustee, as the case may be.
Section 5.11. Limitations on Building Demolition, Alterations, Improvements and
New Construction.
Mortgagor shall not authorize, permit or make any demolition, alteration
or improvement of any building, structure or other improvements included in the
Trust Estate or any new construction on any part of the Trust Estate, except in
conformity with and subject to the limitations hereinafter in this Section 5.11
set forth and set forth in the TCHI Note Indenture.
Unless an Event of Default shall have occurred and be continuing,
Mortgagor shall have the right at all times to make or permit such demolition,
alterations, improvements or new construction, structural or otherwise (herein
sometimes called collectively "Alterations" and each, individually, an
"Alteration"), of the Trust Estate, to be made in all cases subject to each of
the following conditions:
(a) No Alteration shall be undertaken or carried out except in conformity
with all Superior Instrument Requirements, Legal Requirements and Insurance
Requirements.
(b) If the estimated cost of any Alteration, together with other
Alterations that constitute a single construction plan or project (whether or
not accomplished in several stages or procedures), exceeds $5,000,000, the
building or buildings, structures or other improvements as so improved or
altered, upon the completion of the work, shall be of a value not less than the
value of such building or buildings, structures or other improvements
immediately prior to the making of such Alteration.
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(c) Any Alteration which is structural in nature or involves an estimated
cost of more than $5,000,000 shall be conducted under the supervision of an
Architect, and no such Alteration shall be undertaken until 10 days after there
shall have been filed with Mortgagee detailed plans and specifications and cost
estimates therefor, prepared and approved in writing by such Architect and
accompanied by a certificate of such Architect stating that such plans and
specifications conform to all applicable provisions of this Section 5.11.
(d) No Alteration involving an estimated cost of more than $5,000,000
shall be undertaken until Mortgagor has furnished to Mortgagee, at Mortgagor's
sole cost and expense, a surety bond or bonds, covering performance, and labor
and material payments with respect to the work to be so performed, naming
Mortgagee as obligee, issued by a responsible surety company, authorized to do
business in the State of New Jersey, in a form generally and customarily used by
such surety in an amount equal to the estimated cost of construction of the work
covered by the plans and specifications therefor, guaranteeing the performance
and completion of such construction, substantially in conformity with the said
plans and specifications and within a reasonable time, subject to delays by
fire, strikes, lock-out, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable Casualty
or other similar causes beyond the control of Mortgagor, free and clear of all
liens, claims and liabilities for the cost of such Alterations. If such surety
bond or bonds shall be unobtainable Mortgagor shall deliver to Mortgagee
security by cash, letter of credit or other guarantee, affording substantially
the same protection as would such bond or bonds.
(e) All work done in connection with any Alterations shall be done
promptly and in good and workmanlike manner. The work in connection with any
Alteration shall be prosecuted with reasonable dispatch, delays due to fire,
strikes, lock-outs, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable Casualty
or similar causes beyond the control of Mortgagor excepted.
(f) If the estimated cost of Alterations exceeds $5,000,000, Mortgagor
shall have delivered to Mortgagee (i) prior to the commencement of such
Alterations, copies of all Permits required for the commencement of such work
together with a certificate of the Architect or an Opinion of Counsel to the
effect that all Permits required for the commencement of such Alterations have
been obtained; and (ii) within a reasonable period of time after the completion
of the Alterations, copies of all Permits required in connection with the
completion thereof, together with either an Opinion of Counsel or a certificate
of the Architect that all such Permits have been so obtained by Mortgagor and
that Mortgagor has complied with all the requirements of this Section 5.11.
(g) No Alterations of any kind shall be made which shall change the use or
reduce the size or quality of any building, structure or other improvements in
any material respect or which shall change the use of the Casino Hotel from its
use as a gaming and hotel facility.
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(h) No Alterations costing in excess of $5,000,000, together with other
Alterations that constitute a single construction plan or project (whether or
not accomplished in several stages or procedures), shall be made if such
Alterations are not expected to be completed at least 120 days prior to the
Stated Maturity of the TCHI Notes (except if such Alterations are required in
order to comply with Legal Requirements or Superior Instrument Requirements).
(i) Mortgagor shall maintain at all times during the performance of
Alterations, in addition to any insurance required to be maintained under
Section 5.11 hereof, appropriate workers' compensation insurance covering all
persons employed for such Alterations to the extent required by applicable law,
and comprehensive general liability insurance expressly covering the additional
hazards due to such Alterations. Each such policy of insurance shall comply with
the provisions of Section 5.10(b), and Mortgagor shall comply with Subsections
(c), (d), (e), (f), (g) and (h) of Section 5.10 in connection with all such
insurance.
Section 5.12. Leases.
Mortgagor shall not:
(a) lease the Trust Estate substantially as an entirety to any Person
(except in accordance with the provisions of Article Eight of the TCHI Note
Indenture), nor shall Mortgagor lease either the Casino Hotel or the Casino or
the Hotel or any parking facilities substantially as an entirety to any Person;
(b) enter into any Lease, or renew, modify, extend, terminate, or amend
any Lease, except in the ordinary course of business of operating the Casino
Hotel;
(c) receive or collect, or permit the receipt or collection of, any rental
payments under any Lease more than one month in advance of the respective
periods in respect of which they are to accrue, except that, in connection with
the execution and delivery of any Lease or of any amendment to any Lease, rental
payments thereunder may be collected and received in advance in an amount not in
excess of three months' rent and/or a security deposit may be required
thereunder in an amount not exceeding one year's rent;
(d) collaterally assign, transfer or hypothecate (other than to Mortgagee
hereunder, to the holder of the Senior Note Mortgage, the holder of the Senior
Guarantee Mortgage or the holder of the Senior Partnership Upstream Note
Mortgage, but in each case only with respect to the property secured by such
mortgage) (i) any rental payment under any Lease whether then due or to accrue
in the future, (ii) the interest of Mortgagor as landlord under any Lease or
(iii) the rents, issues or profits of the Trust Estate;
(e) after the date hereof, enter into any Lease, or renew any Lease,
unless such Lease contains terms to the effect as follows:
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(i) the Lease and the rights of the tenants thereunder shall be
subject and subordinate to the rights of Mortgagee under this TCHI Note
Guarantee Mortgage,
(ii) the Lease may be assigned by the landlord thereunder to
Mortgagee, and
(iii) the rights and remedies of the tenant in respect of any
obligations of the landlord thereunder shall be nonrecourse as to any
assets of the landlord other than its equity in the building in which the
leased premises are located or the proceeds thereof; or
(f) modify any Lease with respect to the matters described in clauses (i)
through (iii) of paragraph (e).
If Mortgagor enters into a Lease (other than with an Affiliate of
Mortgagor) for a term of not less than 3 years, Mortgagee shall deliver a
non-disturbance and attornment agreement substantially in the form of Schedule 7
hereto, following receipt of a certificate of a leasing broker (who is not an
Affiliate of Mortgagor or the broker involved in such transaction) experienced
with respect to leases of commercial space in the Atlantic City area stating
that the rent under the Lease throughout the term thereof is not less than fair
market rent and the other terms of the Lease are fair and reasonable in the
commercial leasing market. Mortgagor shall, upon demand, reimburse Mortgagee for
any costs and expenses (including reasonable attorneys' fees and disbursements)
incurred by Mortgagee in connection with the preparation, review and delivery of
such non-disturbance and attornment agreements.
Promptly after the execution and delivery hereof, and promptly after each
Lease is executed or becomes effective after the date of the execution and
delivery hereof, Mortgagor shall cause the lessee under each such Lease to be
duly notified in writing (unless the substance and effect of such notice shall
be contained in such Lease) of the subjection of the owner's interest, as
lessor, in and to such Lease to the lien of this TCHI Note Guarantee Mortgage
and of the name and address of Mortgagee. Each such notice shall state that the
lease of such lessee is a Lease as herein defined. If a new Mortgagee is at any
time appointed hereunder or the address of Mortgagee shall at any time be
changed, Mortgagor shall cause each lessee under each Lease to be promptly
notified in writing of the name and address of such new Mortgagee or the new
address of Mortgagee. Mortgagor shall use reasonable efforts (but shall not be
obligated to incur any expenditure other than de minimis amounts) to obtain from
each lessee under each Lease to whom any notice is sent pursuant to this
paragraph an acknowledgment of receipt of such notice, and Mortgagor shall
promptly deliver to Mortgagee,, upon request, a copy of each such acknowledgment
of receipt which it is able to obtain. Mortgagee shall not be responsible for
securing or causing Mortgagor to secure any such acknowledgment.
Section 5.13. Compliance Certificates.
Mortgagor shall deliver to Mortgagee, within 120 days after the end of
each fiscal year of Mortgagor, a Mortgagor's Certificate stating that
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(a) a review of the activities of Mortgagor during such year and of
performance under this TCHI Note Guarantee Mortgage has been made under the
signer's supervision, and
(b) to the best of each signer's knowledge, based on such review,
Mortgagor has fulfilled all of Mortgagor's obligations under this TCHI Note
Guarantee Mortgage throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to him
and the nature and status thereof.
Promptly after Mortgagor may reasonably be deemed to have knowledge of a
default hereunder, Mortgagor shall deliver to Mortgagee a notice specifying the
nature and period of existence thereof and the action Mortgagor is taking and
proposes to take with respect thereto.
Section 5.14. To Keep Books; Inspection by Mortgagee.
Mortgagor will keep proper books of record and account, in which full and
correct entries shall be made of all dealings or transactions of or in relation
to the properties, business and affairs of Mortgagor in accordance with
generally accepted accounting principles consistently applied. Said books shall
be maintained in an office located either in Atlantic City, New Jersey or in the
Borough of Manhattan, City of New York, State of New York. Mortgagor shall at
any and all times, upon request of Mortgagee and at the expense of Mortgagor,
permit Mortgagee and its representatives to inspect the Casino Hotel and any
other buildings, structures and improvements now or hereafter located on the
Land and the books of account, records, reports and other papers of Mortgagor,
and to make copies and extracts therefrom, and will afford and procure a
reasonable opportunity to make any such inspection (provided, that any such
inspection shall not unreasonably interfere with the business operations of
Mortgagor), and Mortgagor will furnish to Mortgagee any and all information as
Mortgagee may reasonably request, with respect to the performance by Mortgagor
of its covenants in this TCHI Note Guarantee Mortgage.
Section 5.15. Advances by Mortgagee.
If Mortgagor shall fail to perform any of the covenants, terms, provisions
or conditions contained in this TCHI Note Guarantee Mortgage and such failure
shall continue for 10 days following notice thereof given by Mortgagee (or at
any time, without notice, in case of emergency), Mortgagee may (but is not
obligated to), at any time and from time to time, take any action or make
advances, to effect performance of any such covenant, term, provision or
condition on behalf of Mortgagor; and all moneys so used, paid or advanced by
Mortgagee and all reasonable costs and expenses incurred by Mortgagee in
connection therewith, together with interest on all of the same at the rate of
interest set forth in the TCHI Notes, shall be immediately due and payable by
Mortgagor to Mortgagee and all such moneys, costs and expenses shall be secured
by the lien of this TCHI Note Guarantee Mortgage prior to the TCHI Notes. No
such advance or payment by Mortgagee shall relieve Mortgagor from any default
hereunder or impair any right or remedy of Mortgagee.
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Section 5.16. Waiver of Stay, Extension or Usury Laws.
Mortgagor covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any usury, stay or extension law or any other
law which would prohibit or forgive Mortgagor from paying all or any portion of
the obligations secured by this TCHI Note Guarantee Mortgage, wherever enacted,
now or at any time hereafter in force, or which may otherwise affect the
covenants or the performance of this TCHI Note Guarantee Mortgage; and Mortgagor
(to the extent that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law, and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to Mortgagee, but shall suffer
and permit the execution of every such power as though no such law had been
enacted.
Section 5.17. Eminent Domain.
(a) Mortgagor shall notify Mortgagee immediately upon obtaining knowledge
of any Taking affecting the Trust Estate or any part thereof. If the Taking is a
Taking of less than the whole or substantially all of the Premises but (i) is
estimated to result in an award of more than $10,000,000 or (ii) the Taking will
interfere with or adversely affect the operation of the Casino Hotel (other than
any portion thereof consisting solely of unimproved, paved or unpaved surface
parking) other than to a de minimis extent, then within 30 days after such
Taking, Mortgagor shall deliver to Mortgagee a certificate of an Architect
stating whether, in such Architect's opinion, applicable Legal Requirements
permit the Restoration of any buildings and improvements for the same uses and
to the same size and quality in all material respects as existed immediately
prior to the Taking (and if said certificate states that Legal Requirements do
not permit such Restoration, said certificate shall describe the manner closest
approximating such criteria to which the buildings and improvements could be so
restored and shall be accompanied by a Certificate of Appraised Value dated not
more than 10 days prior to delivery setting forth the Appraised Value
immediately prior to the Taking and the estimated Appraised Value immediately
after the permitted Restoration). If Mortgagor is required to deliver such
Certificate of Appraised value and if based on such Certificate of Appraised
Value immediately after Restoration, (i) the Outstanding Amount of Indebtedness
of the Mortgagor, the Company or TCHI immediately after such Restoration shall
exceed the greater of (A) 80% of the Appraised Value immediately after such
Restoration or (B) the quotient of the Outstanding Amount of Indebtedness of the
Mortgagor, the Company or TCHI immediately prior to such Taking divided by the
Appraised Value immediately prior to the Taking multiplied by the Appraised
Value immediately after such Restoration, or (ii) applicable Legal Requirements
do not permit the Restoration of the Casino Hotel for use as a casino and hotel
complex, then, in any of such events, the Taking shall be deemed a Taking of
"the whole or substantially all of the Premises." The Taking shall be deemed a
Taking of "less than the whole or substantially all of the Premises" if
Mortgagor is not required to deliver a Certificate Of Appraised Value or if, at
the time of delivery of such Certificate, neither of the tests set forth in
clauses (i) and (ii) is met.
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(b) If at any time there shall occur a Taking of less than the whole or
substantially all of the Premises and the award or awards resulting therefrom
payable to Mortgagor (and not to any lessor under any Facility Lease) (after
there shall have been first deducted the fees and expenses incurred in
connection with the termination, settlement and collection of such award or
awards, including, without limitation, reasonable counsel fees and expenses,
hereinafter referred to as "Settlement Costs") (i) shall be less than
$10,000,000 (except to the extent that the Insurance Trustee is required to hold
such amount pursuant to a Superior Instrument Requirements), the entire amount
of such award shall be paid to Mortgagor; and (ii) if such award is $10,000,000
or more, the entire amount of such award shall be paid to the Insurance Trustee.
In either event, such awards shall be applied to the cost of Restoration of the
Trust Estate as nearly as practicable to their uses, value and condition
immediately prior to the Taking (except to the extent otherwise provided by
Superior Instrument Requirements). Mortgagor shall promptly commence and with
due diligence perform the Restoration in accordance with clauses (iii), (iv) and
(vii) of Subsection 5.10(e) (after substituting the words "Taking" for
"Casualty" and "award" for "net insurance proceeds"), at no cost to Mortgagee.
All claims or suits arising out of any Taking may be settled by Mortgagor,
except that Mortgagee shall have the right (but not the obligation) to
participate in such claim or suit, and to approve settlement thereof (and
notwithstanding anything in the Facility Leases to the contrary, Mortgagor shall
not agree to any settlement or compromise of the amount of any such claim or
suit, except a claim or suit where the amount reasonably anticipated to be
received by Mortgagor is less than $5,000,000). If Mortgagee at its election as
aforesaid joins such claim or suit, Mortgagee's approval of such settlement
shall not be unreasonably withheld. The Insurance Trustee shall promptly pay
such sums as are received by it from such Taking from time to time in accordance
with the procedures set forth in clauses (v) and (vi) of Subsection 5.10(e)
(after substituting the words "Taking" for "Casualty" and "award" for "net
insurance proceeds").
(c) If at any time there shall occur a Taking of the whole or
substantially all of the Premises, then the award payable to Mortgagor shall not
be applied to Restoration but shall instead be paid and delivered to the Trustee
(subject to the rights of the lessors under any Facility Leases) to the extent
of the then Outstanding Amount of the TCHI Notes and any other interest or other
sums due hereunder or thereunder to be applied to the satisfaction of this TCHI
Note Guarantee Mortgage to the extent proceeds are available for such purpose
and provided that no additional sums are due to the trustee or the holders under
the Senior Note Indenture, the Senior Notes, the Senior Guarantee, the TCHI
Notes, the TCHI Note Indenture or the TCHI Guarantee, the balance of the award
shall be paid to Mortgagor.
(d) Notwithstanding anything contained herein to the contrary, if an Event
of Default shall have occurred and is continuing, Mortgagee may, at its option,
(i) refrain from paying to Mortgagor or the Insurance Trustee any award or (ii)
instruct the Insurance Trustee to pay to Mortgagee any award then held by the
Insurance Trustee, as the case may be.
Section 5.18. Facility Leases.
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(a) Mortgagor shall do or cause to be done all things necessary to
preserve and keep unimpaired the rights of Mortgagor, as lessee under all
Facility Leases, and, to prevent any termination, surrender, cancellation,
forfeiture or impairment of any thereof. Mortgagor shall at all times fully
perform and comply with all agreements, covenants, terms and conditions imposed
upon or assumed by it as lessee under each of the Facility Leases (including,
without limitation, the covenant to pay rent and all taxes, assessments and
other charges mentioned therein) prior to the expiration of any notice and/or
cure period provided in each such Facility Lease. Upon receipt by Mortgagee from
a Lessor of any written notice of default by the lessee thereunder, Mortgagee
may rely thereon and take any action Mortgagee deems necessary in its sole
discretion to prevent or to cure any default by Mortgagor in the performance of
or compliance with any of the agreements, covenants, terms or conditions imposed
upon or assumed by Mortgagor as lessee under such Facility Lease, even though
the existence of such default or the nature thereof be questioned or denied by
Mortgagor or by any party on behalf of Mortgagor. Without limiting the
generality of Section 3.9, Mortgagor hereby expressly grants to Mortgagee, and
agrees that Mortgagee shall have, the absolute and immediate right to enter in
and upon the Premises or any part thereof to such extent and as often as
Mortgagee, in its sole discretion, deems necessary or desirable for the purpose
permitted by the immediately preceding sentence, subject only to applicable
Legal Requirements. Without limiting Mortgagor's obligations or Mortgagee's
rights set forth above or limiting Mortgagee's other remedies under this TCHI
Note Guarantee Mortgage, Mortgagee may pay and expend such sums of money as
Mortgagee in its sole discretion deems necessary for any such purpose, and
Mortgagor hereby agrees to pay to Mortgagee immediately and without demand, all
such sums referred to above, so paid and expended by Mortgagee, together with
interest thereon from the date of each such payment at the highest rate of
interest set forth in the TCHI Notes. All sums so paid and expended by
Mortgagee, and the interest thereon, shall be added to and be secured by the
lien of this TCHI Note Guarantee Mortgage.
(b) Mortgagor further covenants and agrees as follows:
(i) Mortgagor shall not surrender, terminate or cancel any Facility
Lease, and shall not without the consent of Mortgagee modify, change,
supplement, alter or amend any Facility Lease either orally or in writing
if an impairment of the security granted under this TCHI Note Guarantee
Mortgage would result therefrom. As further security for the repayment of
the indebtedness secured hereby and for the performance of the covenants
herein and in each Facility Lease contained, Mortgagor hereby assigns to
Mortgagee all of Mortgagor's rights, privileges and prerogatives as lessee
under each Facility Lease to terminate, cancel, modify, change,
supplement, alter or amend such Facility Lease and any such termination,
cancellation, modification, change, supplement, alteration or amendment of
a Facility Lease without the prior consent thereto by Mortgagee shall be
void and of no force and effect. Unless (1) an Event of Default has
occurred and is continuing and (2) either (A) there has been an
acceleration of maturity of the Senior Partnership Note pursuant to
Section 3.2 or (B) Mortgagee exercises its rights
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under Section 3.9, Mortgagee shall have no right to terminate, cancel,
modify, change, supplement, alter or amend any Facility Lease.
(ii) Solely for the benefit of Mortgagee, Trustee, the Holders and
no other person, no release or forbearance of any of Mortgagor's
obligations under any Facility Lease, pursuant to such Facility Lease or
otherwise, shall release Mortgagor from any of Mortgagor's other
obligations under this TCHI Note Guarantee Mortgage.
(iii) Unless Mortgagee shall otherwise expressly consent in writing,
the fee title to the Leased Facilities and Mortgagor's leasehold estates
therein shall not merge and shall always remain separate and distinct,
notwithstanding the union of said estates either in the Lessor or in the
lessee, or in a third party by purchase or otherwise
(iv) Mortgagor shall promptly notify Mortgagee in writing of any
request made by Mortgagor, as lessee under any Facility Lease, or any of
the Lessors, for arbitration proceedings under any Facility Lease and of
the institution of any arbitration proceedings, as well as all proceedings
thereunder. Mortgagor shall promptly deliver to Mortgagee a copy of the
determination of the arbitrators in each such arbitration proceeding.
Mortgagee shall have the right to participate in such arbitration
proceedings in association with Mortgagor or on its own behalf as an
interested party.
(v) Mortgagor shall not consent to the subordination of any Facility
Lease to any mortgage, deed of trust or other lien on the fee interest of
the Lessor.
(vi) If Mortgagor acquires fee simple title or any other estate,
title or interest in any Leased Facility, Mortgagor shall promptly notify
Mortgagee of such acquisition and, on request by Mortgagee, shall cause to
be executed and recorded all such other and further assurances or other
instruments in writing as may in the opinion of Mortgagee be required or
desirable to carry out the intent and meaning of clause (x) of Granting
Clause Third.
(vii) Within 5 days after Mortgagor's receipt of any notice of any
motion, application or effort to reject any Facility Lease by any Lessor
or any trustee arising from or in connection with any case, proceeding or
other action commenced or pending by or against any Lessor under the Code
or any comparable provision contained in any present or future federal,
state, local, foreign or other statute, law, rule or regulation
("Comparable Provision"), Mortgagor shall give notice thereof to
Mortgagee. Mortgagor hereby (A) assigns to Mortgagee any and all of
Mortgagor's rights as lessee under Section 365(h) of the Code or any
Comparable Provision and (B) covenants that it shall not elect to treat
any Facility Lease as terminated pursuant to Section 365(h) of the Code or
any Comparable Provision without the prior consent of Mortgagee and (C)
agrees that any such election by Mortgagor without such consent shall be
null and void.
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(viii) Without limiting the generality of the foregoing, to the
extent permitted by applicable law, Mortgagor hereby unconditionally
assigns, transfers and sets over to Mortgagee all of Mortgagor's claims
and rights to the payment of damages arising from any rejection by Lessor
of any Facility Lease under the Code or any Comparable Provision.
Mortgagee shall have the right to proceed in its own name or in the name
of Mortgagor in respect of any claim, suit, action or proceeding relating
to the rejection of any Facility Lease, including, without limitation, the
right to file and prosecute, in cooperation with Mortgagor, any proofs of
claim, complaints, motions, applications, notices and other documents, in
any case in respect of Lessor under the Code or any Comparable Provision.
This assignment constitutes a present, irrevocable and unconditional
assignment of the foregoing claims, rights and remedies, and shall
continue in effect until all of the indebtedness and obligations secured
by this TCHI Note Guarantee Mortgage shall have been satisfied and
discharged in full. Any amounts received by Mortgagee in damages arising
out of the rejection of any Facility Lease as aforesaid shall be applied
first to all reasonable costs and expenses of Mortgagee (including,
without limitation, reasonable attorneys' fees, disbursements and court
costs) incurred in connection with the exercise of any of its rights or
remedies under this Section 5.18, and thereafter as provided in Section
3.3.
(ix) If there shall be filed by or against Mortgagor a petition
under the Code or any Comparable Provision and Mortgagor, as lessee under
any Facility Lease, shall determine to reject such Facility Lease,
Mortgagor shall give Mortgagee not less than 10 days' prior notice of the
date on which Mortgagor shall apply to the Bankruptcy Court or other
judicial body with appropriate jurisdiction for authority to reject such
Facility Lease. Mortgagee shall have the right, but not the obligation, to
serve upon Mortgagor within such 10-day period a notice stating that (a)
Mortgagee demands that Mortgagor assume and assign such Facility Lease to
Mortgagee pursuant to Section 365 of the Code or any Comparable Provision
and (b) Mortgagee covenants to cure or provide adequate assurance of
prompt cure of all defaults and provide adequate assurance of future
performance under such Facility Lease. If Mortgagee serves upon Mortgagor
the notice described in the preceding sentence, Mortgagor shall not seek
to reject such Facility Lease and shall comply with the demand provided
for in clause (a) of the preceding sentence within 30 days after the
notice shall have been given subject to the performance by Mortgagee of
the covenant provided for in clause (b) of the preceding sentence. The
foregoing provisions of this Section 5.18(ix) shall not apply to the
extent not permitted by applicable law. Effective upon the entry of an
order for relief in respect of Mortgagor under Chapter 7 of the Code or
any Comparable Provision, Mortgagor hereby assigns and transfers to
Mortgagee a non-exclusive right to apply to the Bankruptcy Court or other
judicial body with appropriate jurisdiction for an order extending the
period during which such Facility Lease may be rejected or assumed.
(x) Mortgagor shall promptly give to Mortgagee copies of (A) all
notices of default and (B) any other communications or notices with
respect to events that relate to
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the possible impairment of the security of this TCHI Note Guarantee
Mortgage, which Mortgagor shall give or receive under any Facility Lease
and shall promptly notify Mortgagee of any default under any Facility
Lease on the part of the Lessor or Mortgagor.
(xi) Mortgagor shall enforce with due diligence all of the
obligations of the Lessor under each Facility Lease, to the end that
Mortgagor may enjoy all of the rights and privileges granted to it under
the Facility Leases.
(xii) Mortgagor shall notify Mortgagee within 5 days after the
transfer of a fee interest in any Leased Facility or any portion thereof
to or from an Affiliate.
(xiii) No Affiliate of Mortgagor shall at any time hereafter acquire
fee title to the Leased Land or any portion thereof unless simultaneously
with such acquisition such Affiliate and Mortgagor execute and exchange
(and deliver to the Trustee an executed counterpart of) an instrument in
form and substance satisfactory to Mortgagee providing that so long as
such Affiliate owns such fee title (A) such Affiliate shall not terminate
the applicable Facility Lease for any reason whatsoever (including,
without limitation, due to the default of Mortgagor under such Facility
Lease) and (B) such Affiliate shall not accept, and, if tendered by
Mortgagor shall promptly return to Mortgagor, any payment of rent or other
charges payable under such Facility Lease in excess of the amount required
to pay the debt service and other sums payable under any mortgage
affecting such Affiliate's fee interest in the applicable Leased Facility
(and such Affiliate shall use such funds only to pay its debt service
obligations and other sums payable under such mortgage) at any time that
an Event of Default, or a Default of the types described in Section
3.1(a), (b) and (f) of this TCHI Note Guarantee Mortgage or Section
5.1(a), (b), (f) or (g) of the TCHI Note Indenture, shall have occurred
and be continuing under this TCHI Note Guarantee Mortgage or the TCHI Note
Indenture.
(c) Subject to the provisions of Subsection 5.18(b)(iii), if both the
lessor's and lessee's estates under any Facility Lease or any portion thereof
shall at any time become vested in one owner, this TCHI Note Guarantee Mortgage
and the lien created hereby shall nevertheless not be destroyed or terminated by
application of the doctrine of merger and, in such event, Mortgagee shall
continue to have all of the rights and privileges of a first leasehold
mortgagee.
(d) Mortgagor hereby acknowledges that if any Facility Lease shall be
terminated prior to the natural expiration of its term due to default by the
lessee thereunder, and if pursuant to such Facility Lease, Mortgagee or its
designee shall acquire from the Lessor a new lease of the Leased Facility or any
portion thereof, Mortgagor shall have no right, title or interest in or to such
lease or the leasehold estate created thereby, or the options therein contained.
(e) Each Facility Lease hereafter entered into or assumed by Mortgagor as
lessee or sublessee shall contain provisions (i) permitting the assignment of
the same to Mortgagee and the
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Trustee and permitting assignment without the lessor's consent if this TCHI Note
Guarantee Mortgage is foreclosed; and (ii) providing protection to Mortgagee, as
leasehold mortgagee, in form reasonably satisfactory to Mortgagee.
Section 5.19. Indemnification.
Mortgagor shall protect, indemnify, hold harmless and defend Mortgagee and
its directors, officers, partners, shareholders, agents, servants and employees
from and against any and all liabilities, obligations, claims, damages,
penalties, causes of action, costs and expenses (including, without limitation,
reasonable attorneys' fees, disbursements and court costs), imposed upon or
incurred by or asserted against Mortgagee by reason of (a) any injury to or
death of Persons or loss of or damage to property occurring on or about the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (b) any use, nonuse or condition of the
Premises or any part thereof or the adjoining sidewalks, curbs, vaults and vault
spaces, if any, streets, alleys or ways, (c) any failure on the part of
Mortgagor to perform or comply with any of the terms of this TCHI Note Guarantee
Mortgage, (d) performance of any labor or services or the furnishing of any
materials or other property in respect of the Premises or any part thereof made
or suffered to be made by or on behalf of Mortgagor, (e) any negligence or
tortious act on the part of Mortgagor or any of its agents, contractors,
lessees, licensees or invitees, or (f) any work in connection with the Premises;
provided, that no amounts shall be payable to Mortgagee under this Section 5.19
in respect of liabilities, obligations, claims, damages, penalties, causes of
action, costs or expenses imposed upon or incurred by or asserted against
Mortgagee to the extent the same result from any negligence or tortious act on
the part of Mortgagee or any of its agents, contractors, lessees, licensees or
invitees. All amounts payable to Mortgagee under this Section 5.19 shall be
payable on demand; provided, that with respect to consequential damages (other
than attorneys' fees, disbursements and court costs imposed upon or incurred by
Mortgagee in connection therewith, which shall in all events be payable on
demand), no such amounts shall be payable until, and to the extent that, (i)
there has been entered the final determination of a court of competent
jurisdiction awarding such consequential damages to the party or parties seeking
such damages or (ii) an agreement of settlement with respect thereto (which
shall have been previously approved by Mortgagor, such consent not to be
unreasonably withheld) shall have been executed by Mortgagee and such party or
parties. Any such amounts which are not paid within 5 days after demand therefor
by Mortgagee shall bear interest at the rate set forth in the TCHI Notes from
the date of such demand and all such amounts and interest thereon shall be
secured by the lien of this TCHI Note Guarantee Mortgage. In case any action,
suit or proceeding is brought against Mortgagee by reason of any such
occurrence, Mortgagor, upon request of Mortgagee, shall, at Mortgagor's expense,
resist and defend such action, suit or proceeding or cause the same to be
resisted or defended by counsel designated by Mortgagor and approved by
Mortgagee, which approval shall not be unreasonably withheld; provided, that
Willkie, Farr & Gallagher is hereby approved by Mortgagee.
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Section 5.20 Senior Mortgages.
(a) Mortgagor shall at all times fully perform and comply with all
agreements, covenants, terms and conditions imposed upon or assumed by it as
mortgagor under the Senior Mortgages prior to the expiration of any notice
and/or cure period provided in each such Senior Mortgage. If a notice of default
has been given by the holder of the Senior Mortgages, Mortgagee may rely thereon
and take any action Mortgagee deems necessary in its sole discretion to prevent
or to cure any default by Mortgagor in the performance of or compliance with any
of the agreements, covenants, terms or conditions imposed upon or assumed by
Mortgagor as mortgagor (or assignee of the Mortgagor) under the Senior Mortgages
even though the existence of such default or the nature thereof be questioned or
denied by Mortgagor or by any party on behalf of Mortgagor. Without limiting the
generality of Section 3.9, Mortgagor hereby expressly grants to Mortgagee, and
agrees that Mortgagee shall have, the absolute and immediate right to enter in
and upon the Premises or any part thereof to such extent and as often as
Mortgagee, in its sole discretion, deems necessary or desirable for the purpose
permitted by the immediately preceding sentence, subject only to applicable
Legal Requirements. Without limiting Mortgagor's obligations or Mortgagee's
rights set forth above or limiting Mortgagee's other remedies under this
Mortgage, Mortgagee may (i) pay and expend such sums of money as Mortgagee in
its sole discretion deems necessary or desirable for any such purpose and (ii)
in its sole discretion prepay the Senior Mortgages then in default, and
Mortgagor hereby agrees to pay to Mortgagee immediately and without demand, all
such sums referred to in (i) and (ii) above so paid and expended by Mortgagee,
together with interest thereon from the date of each such payment at the highest
rate of interest set forth in the Senior Notes. All sums so paid and expended by
Mortgagee and the interest thereon, shall be added to and be secured by the lien
of this Mortgage.
(b) Mortgagor further covenants and agrees:
(i) Mortgagor shall not, without first obtaining the consent of
Mortgagee in each instance: (A) modify, replace or refinance the Senior
Mortgages if (x) the collateral securing the lien thereof would be
increased thereby (other than after-acquired property required by the
terms of the Senior Mortgages to be encumbered thereby) or (y) such
modification, replacement or refinancing violates any other provision of
this TCHI Note Mortgage or the TCHI Note Indenture or (B) acquire or
permit or suffer any Affiliate of Mortgagor to acquire the Senior
Mortgages or any Interest therein;
(ii) Mortgagor shall timely pay and perform all of the obligations
to be paid or performed by the mortgagor under the Senior Mortgages, the
notes secured thereby and any other instrument evidencing or securing the
indebtedness owing to any holder of the Senior Mortgages;
(iii) at any time and from time to time, Mortgagor shall upon
request of Mortgagee promptly use its reasonable efforts to obtain an
estoppel certificate or letter
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addressed to Mortgagee from the holder of the Senior Mortgages, such
certificate or letter to be in such form as Mortgagee shall reasonably
request;
(iv) Mortgagor shall promptly give to Mortgagee copies of (A) all
notices of default or (B) any other notice or communication with respect
to events which relate to the possible impairment of the security of this
Mortgage, which Mortgagor shall give or receive under the Senior Mortgages
and shall promptly notify Mortgagee of any default under the Senior
Mortgages on the part of Mortgagor.
[Remainder of this Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed and attested, all as of the day and year first above written.
TRUMP'S CASTLE ASSOCIATES, L.P.,
a New Jersey limited partnership
By: Trump's Castle Hotel & Casino, Inc.,
its general partner
Witness: /s/ Henry Smokler By: /s/ Nicholas L. Ribis
-------------------- -------------------------------------
Henry Smokler Name: Nicholas L. Ribis
Title: President and Chief
Executive Officer
U.S. BANK NATIONAL ASSOCIATION,
a national banking association
Witness: /s/ Carol Leslie By: /s/ Richard H. Prokosch
--------------------- -------------------------------------
Carol Leslie Name: Richard H. Prokosh
Title: Assistant Vice President
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STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 15th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
NICHOLAS L. RIBIS, the President and Chief Executive Officer of TRUMP'S CASTLE
HOTEL & CASINO, INC., the general partner of TRUMP'S CASTLE ASSOCIATES, L.P.,
who I am satisfied is the person who executed the within instrument and he
acknowledged that he signed and delivered the same as such officer on behalf of
such entity and that the within instrument is the voluntary act and deed of said
corporation made by virtue of the authority of its board of directors.
/s/ Marcus Chioffi
- --------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- ------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of Mortgage
and Security Agreement from Trump's Castle Associates to Trump's Castle Funding,
Inc. dated as of December 28, 1993 and recorded in the Atlantic County Registry
of Deeds in Mortgage Book 5238, Page 1, the mortgagee's interest in which was
assigned to First Bank National Association, now known as U.S. Bank National
Association, by a certain Senior Assignment Agreement dated as of December 28,
1993 and recorded in the Atlantic County Registry of Deeds in Assignment Book
651, Page 160 (the "Subordinate Associates Mortgage") hereby consents to and
acknowledges the provisions of the foregoing TCHI Note Guarantee Mortgage and
hereby subordinates the lien created by the Subordinate Associates Mortgage to
this TCHI Note Guarantee Mortgage.
U.S. BANK NATIONAL ASSOCIATION,
a national banking association
Witness: /s/ Carol Leslie By: /s/ Richard H. Prokosch
-------------------- -------------------------------------
Carol Leslie Name: Richard H. Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- ---------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
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Consent of U.S. Bank National Association
The undersigned, being the mortgagee under that certain Indenture of Mortgage
and Security Agreement from Trump's Castle Associates to First Bank National
Association, now known as U.S. Bank National Association, dated as of December
28, 1993 and recorded in the Atlantic County Registry of Deeds in Mortgage Book
5239, Page 1 (the "Subordinate Mortgage") hereby consents to and acknowledges
the provisions of the foregoing TCHI Note Guarantee Mortgage and hereby
subordinates the lien created by the Subordinate Mortgage to this TCHI Note
Guarantee Mortgage.
U.S. BANK NATIONAL ASSOCIATION,
a national banking association
Witness: /s/ Carol Leslie By: /s/ Richard H. Prokosch
---------------------- -------------------------------------
Carol Leslie Name: Richard H. Prokosh
Title: Assistant Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- --------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-68-
<PAGE>
SCHEDULE 1
OWNED LAND
All the real property located in the City of Atlantic City, County of Atlantic,
and State of New Jersey and more particularly described as follows:
CASINO-HOTEL PARCEL
All that certain real property hereinafter particularly described situate, lying
and being in the City of Atlantic City, County of Atlantic and State of New
Jersey.
BEGINNING at the point of intersection of the northwesterly line of Huron Avenue
(100 feet wide) and the northeasterly line of the Atlantic - Brigantine
Boulevard, said Boulevard also known as State Highway Route 87, and extending;
thence
1. North 45 degrees 50 minutes 06 seconds West, in and along the
Atlantic-Brigantine Boulevard, 56.63 feet; thence
2. North 19 degrees 16 minutes 38 seconds East, still in and along said
Boulevard, 81.94 feet to a point of curve; thence
3. Curving to the right in the arc of a circle having a radius of 783.00
feet, the arc length of 72.815 feet to a point of reverse curve; thence
4. Curving to the left in the arc of a circle having a radius of 837.00
feet, the arc length of 77.836 feet to another point of reverse curve; thence
5. Curving to the right in the arc of a circle having a radius of 2946.00
feet, the arc length of 1017.42 feet to a point; thence
6. North 44 degrees 34 minutes 15 seconds East, 135.02 feet to a point of
curve; thence
7. Curving to the right in the arc of a circle having a radius of 2936.00
feet, the arc length of 105.48 feet to a point; thence
8. South 27 degrees 28 minutes 00 seconds East, at right angles to Huron
Avenue 842.02 feet to the northwesterly line of Huron Avenue; thence
9. South 62 degrees 32 minutes 00 seconds West, in and along the
northwesterly line of Huron Avenue, 1229.40 feet to the point and place of
BEGINNING.
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<PAGE>
EXCEPTING THEREOUT AND THEREFROM the property which was conveyed to the State of
New Jersey by the Deeds recorded in Deed Book 3980 page 180 and in Deed Book
4031 page 299.
BEING ALSO KNOWN AND DESIGNATED as Lot 9 in Block H-19 on the Official Tax Map
of the City of Atlantic City.
PARKING FACILITIES PARCEL
BEGINNING at a point in Beach Thorofare at the easterly corner of the parcel of
lands containing an area of 6.199 acres more or less which was conveyed by the
West Jersey and Seashore Railroad Company to the Press Union Publishing Company
by deed dated January 9, 1940, and recorded January 17, 1940 in Deed Book 1099
page 420, said beginning point being South 24 degrees 54 minutes 00 seconds
West, a distance of 100.16 feet from a monument set in the southeasterly line of
Absecon Boulevard (also known as U.S. Route 30) (190 feet wide), and extending
from said beginning point; thence,
(1) In Beach Thorofare, South 24 degrees 54 minutes 00 seconds West, a
distance of 259.81 feet to a point; thence
(2) Continuing in and along same, South 44 degrees 54 minutes 00 seconds West,
a distance of 445.50 feet to a point; thence,
(3) Continuing in and along same, South 72 degrees 24 minutes 00 seconds West,
a distance of 224.40 feet to a point; thence
(4) Continuing in and along same, North 68 degrees 21 minutes 00 seconds West,
a distance of 478.50 feet to a point; thence
(5) Continuing in and along same, North 76 degrees 06 minutes 00 seconds West,
a distance of 363.00 feet to a point; thence
(6) Continuing in and along same, South 82 degrees 39 minutes 00 seconds West,
a distance of 429.00 feet to a point; thence,
(7) Continuing in and along same, North 17 degrees 59 minutes 20 seconds East,
a distance of 320.65 feet to a point located in the approximate high water
line of Beach Thorofare, said point also being a corner of lands now or
formerly in Daniel Adams, et al, as recorded in Deed Book CC Page 272;
thence,
(8) North 39 degrees 01 minutes 00 seconds West, leaving Beach Thorofare, in
and along the line of lands now or formerly of Daniel Adams, et al, a
distance of 1089.00 feet to a point in the southeasterly line of lands now
or formerly of Lot 307 in Block 201 as shown on the current
1-2
<PAGE>
Official Tax Map for the City of Atlantic City, said point also being a
corner to lands now or formerly of Daniel Adams, et al; thence,
(9) North 57 degrees 59 minutes 00 seconds East, in and along the said lands,
a distance of 1113.19 feet to a point in the aforesaid southwesterly line
of Absecon Boulevard; thence,
(10) South 22 degrees 46 minutes 10 seconds East, in and along same, a distance
of 185.42 feet to a point of curve; thence,
(11) Southeastwardly, in and along same and in the arc of a circle curving to
the left having a radius of 1527.69 feet the arc length of 213.90 feet to
a point in the northwesterly line of Lot 230 in said Block 201; thence,
(12) South 09 degrees 08 minutes 24 seconds East, in the southwesterly line of
Absecon Boulevard, a distance of 87.75 feet to a point of curve; thence
(13) Curving to the left along the line of Absecon Boulevard, in the arc of a
circle having a radius of 332.00 feet, the arc length of 201.61 feet to a
point of tangent; thence
(14) South 43 degrees 56 minutes 03 seconds East, continuing in and along the
southwesterly line of Absecon Boulevard, a distance of 128.55 feet to a
point; thence
(15) South 82 degrees 36 minutes 59 seconds East, continuing in and along the
said southwesterly line of Absecon Boulevard, a distance of 10.00 feet to
a point; thence
(16) Curving to the right along the line of Absecon Boulevard, in the arc of a
circle having a radius of 70.00 feet, the arc length of 47.26 feet to a
point of tangent; thence
(17) North 46 degrees 03 minutes 57 seconds East, along the line of Absecon
Boulevard, a distance of 20.81 feet to a point which is radially distant
95.00 feet from the centerline of Absecon Boulevard (190feet wide) at
station 335+98.63 feet; thence
(18) Curving to the left in the Southwesterly line of Absecon Boulevard in the
arc of a circle having a radius of 1527.69 feet, the arc length of 70.33
feet to the northwesterly line of Lot 230 in said Block 201; thence
(19) South 41 degrees 59 minutes 00 seconds West, in and along same, a distance
of 125.00 feet to the extreme westerly corner of said Lot 230; thence
(20) Southeastwardly, in and along the southwesterly line of same, concentric
with Absecon Boulevard, in the arc of a circle curving to the left, having
a radius of 1652.69 feet, the arc length of 324.55 feet to the extreme
southeasterly corner of said Lot 230; thence
1-3
<PAGE>
(21) North 30 degrees 43 minutes 55 seconds East, in and along the
southeasterly line of same, a distance of 125.00 feet to a point in the
aforesaid southwesterly line of Absecon Boulevard; thence
(22) Southeastwardly, in and along same and in the arc of a circle curving to
the left, having a radius of 1527.69 feet, the arc length of 245.58 feet
to a point of tangency; thence
(23) South 68 degrees 22 minutes 10 seconds East, in and along same, a distance
of 50.00 feet to a point in the westerly line of the previously mentioned
6.199+/- acre parcel, also being the northwesterly line of Lot 150 in said
Block 201; thence
(24) South 21 degrees 38 minutes 00 seconds West, in and along same, a distance
of 100.00 feet to a corner in said Lot 150; thence
(25) Continuing in and along same, North 68 degrees 22 minutes 10 seconds West,
a distance of 94.75 feet to a corner; thence
(26) Continuing in and along same, South 27 degrees 48 minutes 00 seconds West,
a distance of 89.04 feet to a corner; thence
(27) Continuing in and along same, South 54 degrees 39 minutes 00 seconds West,
a distance of 65.88 feet to a corner; thence
(28) Continuing in and along same, South 71 degrees 53 minutes 00 seconds West,
a distance of 201.55 feet to a corner; thence
(29) Continuing in and along same, South 51 degrees 29 minutes 00 seconds East,
a distance of 172.09 feet to a corner; thence
(30) Continuing in and along same, South 25 degrees 20 minutes 00 seconds East,
a distance of 216.73 feet to a corner; thence
(31) Continuing in and along same and crossing the aforesaid high water line of
Beach Thorofare, South 84 degrees 22 minutes 00 seconds East, a distance
of 256.83 feet to a corner; thence
(32) Continuing in and along same, North 79 degrees 58 minutes 00 seconds East,
a distance of 279.10 feet to a corner; thence
(33) Continuing in and along same, North 41 degrees 22 minutes 00 seconds East,
a distance of 266.39 feet to the point and place of BEGINNING.
BEING ALSO KNOWN AND DESIGNATED as Lot 231 in Book 201 on the Official Tax Map
of the City of Atlantic City.
1-4
<PAGE>
(PEDESTRIAN BRIDGE)
Air rights, rights of way and easements including the right to construct,
maintain and use a Pedestrian Bridge across Huron Avenue connecting the
Casion-Hotel Parcel with the Farley State Marina Site contained in Ordinance No.
2 of 1988 and affecting the following described premises:
ALL that certain lot, tract, or parcel of land and premises situate, lying, and
being in the City of Atlantic City, County of Atlantic, and State of New Jersey,
bounded and described as follows:
BEGINNING at a point in the southerly line of Huron Avenue (100 feet wide), said
point being distant 956.00 feet eastwardly from the easterly line of Maryland
Avenue (65 feet wide), if same were extended northwardly, and extending from
said beginning point; thence
(1) North 27 degrees 28 minutes 00 seconds West, crossing Huron Avenue, a
distance of 100.00 feet to the northerly line of Huron Avenue; thence
(2) North 62 degrees 32 minutes 00 seconds East, in and along the northerly
line of Huron Avenue, a distance of 30.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, crossing Huron Avenue, a
distance of 100.00 feet to the southerly line of Huron Avenue; thence
(4) South 62 degrees 32 minutes 00 seconds West, in and along the southerly
line of Huron Avenue, a distance of 30.00 feet to the point and place of
BEGINNING.
BEING an area above the horizontal plane of Huron Avenue between the elevation
of 25.00 M.S.L. datum and 50.00 M.S.L. datum.
1-5
<PAGE>
SCHEDULE 2
Leased Land
THE FARLEY STATE MARINA SITE
Beginning at the southeasterly corner of Maryland Avenue (68.00 feet wide
and Huron Avenue 100.00 feet wide) and extending from said beginning point;
thence
(1) South 27 degrees 28 minutes 00 seconds East, in and along the
easterly line of Maryland Avenue, a distance of 804.15 feet; thence
(2) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, a distance of 200.00 feet; thence
(3) South 27 degrees 28 minutes 00 seconds East, parallel with
Maryland Avenue, a distance of 1060.85 feet to a point distant
1745.00 feet northwardly at right angles from the northerly line of
Mediterranean Avenue (60.00 feet wide), said point being in the
fifth course as recited in the Riparian Grant from the State of New
Jersey to the City of Atlantic City, dated March 15, 1920 and
recorded in the Clerk's Office of Atlantic County in Book 632 of
Deeds, Page 117, etc.; thence
(4) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, and in and along said aforementioned Riparian Grant Line, a
distance of 25.00 feet; thence
(5) North 27 degrees 28 minutes 00 seconds West, parallel with
Maryland Avenue, and in and along said aforementioned Riparian Grant
Line, a distance of 9.26 feet; thence
(6) North 09 degrees 01 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 0.04 feet; thence
(7) North 02 degrees 18 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 590.00 feet;
thence
(8) North 62 degrees 32 minutes 00 seconds East, parallel with Huron
Avenue, in and along said aforementioned Riparian Grant Line, a
distance of 160.00 feet; thence
(9) North 41 degrees 39 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 255.00 feet;
thence
2-1
<PAGE>
(10) North 47 degrees 34 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 285.00 feet;
thence
(11) North 56 degrees 02 minutes 00 seconds East, in and along said
aforementioned Riparian Grant Line, a distance of 360.80 feet to a
point distant 1550.00 feet eastwardly at right angles from the
easterly line of Maryland Avenue; thence
(12) North 27 degrees 28 minutes 00 seconds West, parallel with
Maryland Avenue, a distance of 568.21 feet; thence
(13) North 62 degrees 32 minutes 00 seconds East, parallel with
Huron Avenue, a distance of 200.00 feet to the westerly line of
Rhode Island Avenue (50.00 feet wide); thence
(14) North 27 degrees 28 minutes 00 seconds West, in and along the
westerly line of Rhode Island Avenue, a distance of 570.00 feet to
the southerly line of Huron Avenue; thence
(15) South 62 degrees 32 minutes 00 seconds West, in and along the
southerly line of Huron Avenue, a distance of 1750.00 feet to the
point and place of BEGINNING.
EXCEPTING THEREOUT AND THEREFROM the following parcel of land described as:
MARINE POLICE BUILDING PARCEL
BEGINNING at a point in the westerly line of Rhode Island Avenue (50.00 feet
wide), said point being distant 570.00 feet south of the southerly line of Huron
Avenue (100.00 feet wide) and extending; thence
1. South 62 degrees 32 minutes 00 seconds West, parallel with Huron Avenue,
and in and along the division line between Lot 10 and Lot 11 in Block B-4
as shown on the current taxing plan of the City of Atlantic City, a
distance of 97.97 feet; thence
2. North 27 degrees 28 minutes 00 seconds West, parallel with Rhode Island
Avenue, a distance of 179.00 feet; thence
3. North 62 degrees 32 minutes 00 seconds East, parallel with Huron Avenue, a
distance of 97.97 feet to the Westerly line of Rhode Island Avenue; thence
4. South 27 degrees 28 minutes 00 seconds East, in and along the westerly
line of Rhode Island Avenue, a distance of 179.00 feet to the point and
place of BEGINNING.
ALSO EXCEPTING THEREON AND THEREFROM such land and improvements being referred
to as the 7 berths on K dock, for use of the Marina Law Enforcement Bureau as
further described in the Lease referred to in a Short Form Memorandum of Lease
recorded in Deed book 5365, Page 211, and
2-2
<PAGE>
further shown on survey by Arthur W. Ponzio Co. & Assoc., Inc., dated December
28, 1993 and bearing Job No 18488.
BEING ALSO KNOWN AND DESIGNATED as part of Lot 11 in Block B-4 as shown on the
Official Tax Map of Atlantic City, New Jersey.
2-3
<PAGE>
SCHEDULE 3
Existing Encumbrances
1. All matters disclosed in Schedule B and D of the Pro Forma Title Insurance
Policies issued as of the date hereof by Chicago Title Insurance Company
(Numbers 31-131-107-03894 and 31-131-107-03909), First American Title Insurance
Company (Numbers 252242 and 255354) and Commonwealth Land Title Insurance
Company (Numbers L980366 and L980366A);
2. All matters disclosed in Schedule C of the Pro Forma Title Insurance Policies
issued as of the date hereof by Chicago Title Insurance Company (Numbers
31-131-107-03894 and 31-131-107-03909), First American Title Insurance Company
(Numbers 252242 and 255354) and Commonwealth Land Title Insurance Company
(Numbers L980366 and L980366A);
3. All UCC-1 Financing Statements naming Trump's Castle Associates, L.P., as
debtor, and filed prior to April 17, 1998, other than those filed in favor of
(i) Midlantic National Bank, (ii) PNC Bank, N.A., or (iii) First Bank National
Association, as Trustee, under the previously existing Senior Notes;
4. Judgment Number CV-02371-93, entered on September 18, 1997 and Judgment
Number DJ-426844-97, entered on October 20, 1997, both in favor of Amplicon,
Inc.;
5. UCC-1 Financing Statement Number 0018501, filed August 14, 1995, naming
Somerset Ice Co. Inc., as Debtor, and NatWest Bank, N.A., as Secured Party;
6. UCC-1 Financing Statement Number 0017919, filed May 19, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and United Jersey Bank, as
Assignee;
7. UCC-1 Financing Statement Number 0017931, filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and NatWest, as Assignee;
8. UCC-1 Financing Statement Number 0017932 filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and Valley National Bank, as
Assignee;
9. UCC-1 Financing Statement Number 0017933, filed May 22, 1995, in favor of
Madison Leasing Co., Inc., as Secured Party, and Bank of New York, as Assignee;
10. Account balances due to Atlantic City Municipal Utilities Authority for the
properties through April 17, 1998.
3-1
<PAGE>
SCHEDULE 4
FORM OF NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
THIS AGREEMENT, made as of the ______ day of ________ by and between U. S.
Bank National Association having an office at 180 East Fifth Street, St. Paul,
Minnesota 55101 (hereinafter called "Mortgagee") and
_______________________________, a _____________________ corporation having an
office at _______________________________________(hereinafter called "Tenant").
W I T N E S S E T H:
WHEREAS, Mortgagee is the mortgagee under that certain Indenture of
Mortgage and Security Agreement dated as of April 17, 1998 (said mortgage, as it
may be amended, increased, renewed, modified, consolidated, replaced, combined,
substituted, severed, split, spread or extended, being hereinafter referred to
as the "Mortgage") between Mortgagee, as mortgagee and Trump's Castle
Associates, L.P. which encumbers Trump Marina Hotel Casino and certain other
real property located in Atlantic City, New Jersey, more particularly described
in Exhibit A hereto.
WHEREAS, Tenant has entered into a certain agreement of lease dated as of
______________ [as amended by agreements dated and ] and as it may be hereafter
amended from time to time (the "Lease") covering (the "Demised Premises").
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto agree as follows:
1. Tenant covenants and agrees that the Lease now is and shall at all
times continue to be subject and subordinate in each and every respect to the
Mortgage. Tenant, upon request, shall execute and deliver any certificate or
other instrument which the Mortgagee may reasonably request to confirm said
subordination by Tenant.
2. Tenant certifies that the Lease is presently in full force and effect
and unmodified and no base rent payable thereunder has been paid more than one
(1) Year in advance of its due date, and that no default exists under the Lease
which has continued beyond the expiration of any applicable grace period.
3. As long as Tenant is in compliance with the terms of this Agreement and
no default exists under the Lease which has continued beyond the expiration of
any applicable grace period, Mortgagee shall not name Tenant as a party
defendant to any action for foreclosure or other enforcement thereof (unless
required by law), nor shall the Lease be terminated by mortgagee in
4-1
<PAGE>
connection with, or by reason of, foreclosure or other proceedings for the
enforcement of the Mortgage, or by reason of a transfer of the landlord's
interest under the Lease pursuant to the taking of a deed in lieu of foreclosure
(or similar device), nor shall Tenant's use or possession of the Demised
Premises be interfered with by Mortgagee, unless the holder of the landlord's
interest under the Lease (the "Landlord") would have had such right if the
Mortgage had not been made, except that the person acquiring, or succeeding to
the interests of the Landlord as a result of any such action or proceeding, and
such person's successors and assigns (any of the foregoing being hereinafter
referred to as the Successor"), shall not be:
(a) subject to any credits, offsets, defenses or claims which Tenant
might have against any prior landlord; nor
(b) bound by any base rent which Tenant might have paid for more
than the current month to any prior landlord, unless such prepayment shall
have been made with Mortgagee's prior written consent; nor
(c) liable for any act or omission of any prior landlord; nor
(d) bound by any covenant to undertake or complete any improvement
to the Demised Premises or the building forming a part of the Property;
nor
(e) be required to account for any security deposit other than any
security deposit actually delivered to the Successor; nor
(f) liable for any payment to Tenant of any sums, or the granting to
Tenant of any credit, in the nature of a contribution towards the cost of
preparing, furnishing or moving into-the Demised Premises or any portion
thereof.
4. If the interest of the Landlord under the Lease shall be transferred by
reason of foreclosure or other proceedings for enforcement of the Mortgage or
pursuant to a taking of a deed in lieu of foreclosure (or similar device),
Tenant shall be bound to the Successor, and, except as provided in this
Agreement, the Successor shall be bound to Tenant, under all of the terms,
covenants and conditions of the Lease for the balance of the term thereof
remaining, with the same force and effect as if the Successor were the Landlord,
and Tenant does hereby (i) agree to attorn to the Successor, including Mortgagee
if it be the Successor, as its landlord, (ii) affirm its obligations under the
Lease, and (iii) agree to make payments of all sums due under the Lease to the
Successor, said attornment, affirmation and agreement to be effective and
self-operative without the execution of any further instruments, upon the
Successor succeeding to the interest to the Landlord under the Lease. Tenant
waives the provisions of any statute or rule of law now or hereafter in effect
that may give or purport to give it any right or election to terminate or
otherwise adversely affect the Lease or the obligations of Tenant thereunder by
reason of any foreclosure or similar proceeding.
4-2
<PAGE>
5. This Agreement may not be modified except by an agreement in writing
signed by the parties or their respective successors in interest. This Agreement
shall inure to the benefit of and be binding upon the parties hereto, their
respective heirs, representatives, successors and assigns.
6. Nothing contained in this Agreement shall in any way impair or affect
the lien created by the Mortgage except as specifically set forth herein.
7. The Tenant agrees that this Agreement satisfies any condition or
requirement in the Lease relating to the granting of a non-disturbance agreement
by Mortgagee. Tenant further agrees that in the event there is any inconsistency
between the terms and provisions hereof and the terms and provisions of the
Lease dealing with non-disturbance by Mortgagee, the terms and provisions hereof
shall be controlling.
8. All notices, demands or requests made pursuant to, under, or by virtue
of this Agreement must be in writing and mailed to the party whom the notice,
demand or request is being made by certified or registered mail, return receipt
requested, at its address set forth above. Any party may change the place that
notices and demands are to be sent by written notice delivered in accordance
with this Agreement.
9. This Agreement shall be governed by the laws of the State of New
Jersey. If any term of this Agreement or the application thereof to any person
or circumstances shall to any extent be invalid or unenforceable, the remainder
of this Agreement or the application of such term to any person or circumstances
other than those as to which it is invalid or unenforceable shall not be
affected thereby, and each term of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.
4-3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have hereunto caused this Agreement
to be duly executed as of the day and year first above written.
MORTGAGEE
By:________________________________
TENANT
By:_________________________________
[Acknowledgments]
4-4
- --------------------------------------------------------------------------------
SENIOR TCHI ASSIGNMENT AGREEMENT
dated as of April 17, 1998
by
TRUMP'S CASTLE HOTEL & CASINO, INC.,
a New Jersey corporation, as Assignor
to
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the TCHI Note Indenture, as Assignee
- --------------------------------------------------------------------------------
Record and Return to:
Robert L. Nutt, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110
(617) 951-7000
<PAGE>
SENIOR TCHI ASSIGNMENT AGREEMENT
This SENIOR TCHI ASSIGNMENT AGREEMENT (the "Senior TCHI Assignment") is
dated as of April 17, 1998 from TRUMP'S CASTLE HOTEL & CASINO, INC., a New
Jersey corporation ("Assignor"), to U.S. BANK NATIONAL ASSOCIATION, a national
banking association, as Trustee under the TCHI Note Indenture, as defined below
("Assignee").
W I T N E S S E T H:
WHEREAS, Assignor is the general partner of Trump's Castle Associates,
L.P. a New Jersey limited partnership (the "Partnership"), and will function as
the Partnership's financing vehicle for advancing to the Partnership the
proceeds of a certain $5,000,000 Working Capital Facility against receipt of the
Partnership's promissory notes, secured by a mortgage upon the Partnership's
assets; and
WHEREAS, Assignor has issued and sold $5,000,000 aggregate principal
amount of its 10 1/4% Senior Secured Notes due 2003 (the "TCHI Notes", pursuant
to the provisions of an Indenture (the "TCHI Note Indenture") of even date
herewith entered into among the Assignor, as issuer, the Partnership, as
guarantor, and Assignee, as trustee, and has loaned said proceeds to the
Partnership, its subsidiary, in exchange for the Partnership's note in the
principal amount of $5,000,000 (the "Senior Partnership Upstream Note") which is
secured by an Indenture of Mortgage and Security Agreement (the "Senior
Partnership Upstream Note Mortgage") of even date herewith, between the
Partnership, as mortgagor, and the Assignor, as mortgagee;
WHEREAS, the Partnership and the Assignor have entered into an Assignment
of Leases and Rents and Assignment of Operating Assets of even date herewith
(the "TCHI Assignment of Leases"); and
WHEREAS, certain terms defined in the TCHI Note Indenture are used herein
with the meanings there provided.
NOW, THEREFORE, THIS TCHI SENIOR ASSIGNMENT
FURTHER WITNESSETH:
Assignor, for good and valuable consideration, the receipt of which is
hereby acknowledged, does hereby sell, assign and transfer unto Assignee and
unto its successors and to its assigns forever, for its benefit and for the
benefit of the Holders, and does hereby grant to Assignee a security interest in
and to all of Assignor's estate, right, title and interest in, to and under any
and all of the following described property, rights and interests (collectively,
the "Assigned Properties"):
<PAGE>
GRANTING CLAUSE FIRST
All right, title and interest of Assignor in and to the Senior Partnership
Upstream Note, including all renewals, extensions and modifications of the same,
and, without limiting the generality of the foregoing, the present, continuing
and future right to make claim for, collect or cause to be collected, receive or
cause to be received directly from the Partnership thereunder, all payments of
principal, interest and other sums of money payable thereunder.
GRANTING CLAUSE SECOND
All right, title and interest of Assignor in and to the Senior Partnership
Upstream Note Mortgage, including all extensions, renewals and modifications of
the same.
GRANTING CLAUSE THIRD
All right, title and interest of Assignor in and to the TCHI Assignment of
Leases, including all extensions, renewals and modifications of the same.
TO HAVE AND TO HOLD all of said properties, rights and interests unto
Assignee and its successors and assigns forever.
THIS SENIOR TCHI ASSIGNMENT FURTHER WITNESSETH, that Assignor hereby
agrees and covenants with Assignee as follows:
ARTICLE I
PARTICULAR COVENANTS OF ASSIGNOR
Section 1.01. Performance of Covenants. Assignor represents, warrants and
covenants that it is duly authorized to enter into this Senior TCHI Assignment,
and to grant and convey a lien on and security interest in the Assigned
Properties to Assignee in the manner and to the extent herein set forth and that
all action on its part required for the execution and delivery of this Senior
TCHI Assignment has been duly and effectively taken.
Section 1.02. Further Action Required.
(a) Assignor covenants that it will, from time to time, execute and
deliver such further instruments and take such further actions as may be
reasonably required to carry out the purposes of this Senior TCHI Assignment.
(b) Assignor hereby appoints Assignee as its lawful attorney-in-fact (such
power being coupled with an interest) in the name of Assignor or Assignee or
both to execute any instruments
-2-
<PAGE>
or to take any actions to enforce all rights, powers and remedies of Assignor
under or pursuant to the Assigned Properties.
(c) Nothing contained herein shall limit the rights of Assignee contained
in the Mortgage Notes, the Mortgage Note Indenture, the Senior Notes, the Senior
Note Indenture, the TCHI Notes or the TCHI Note Indenture.
ARTICLE II
OBLIGATIONS OF ASSIGNEE
Section 2.01. Continuing Obligations.
(a) Assignee shall have no obligation, duty or liability with respect to
the Assigned Properties or any of them (other than those specifically assumed in
its capacity as Trustee pursuant to the TCHI Note Indenture).
(b) Assignor shall at all times remain liable to observe and perform all
of its covenants and obligations, if any, under the Assigned Properties, and
does hereby agree to indemnify and hold harmless Assignee, its successors and
assigns, from any liability, loss, damage or expense it or they may incur under
the Assigned Properties or by reason of this Senior TCHI Assignment.
ARTICLE III
PAYMENTS
Section 3.01. Payments. All Revenues (as hereinafter defined) due and to
become due under or pursuant to the Assigned Properties shall be paid by the
Partnership directly to Assignee at the address set forth in Section 6.02
hereof.
Section 3.02. Acknowledgment. The Partnership hereby joins in the
execution of this Senior TCHI Assignment to acknowledge (i) the assignment by
Assignor to Assignee of Assignor's right, title and interest in, to and under
the Assigned Properties, (ii) the Partnership's agreement to make payment of all
Revenues under the Assigned Properties directly to Assignee at the address set
forth in this Senior TCHI Assignment, and (iii) the right of Assignee to
exercise or enforce in its own name, in the name of Assignor, or both, all of
the rights, powers and remedies of Assignor in, to and under the Assigned
Properties.
Section 3.03. Revenues. As used herein, the term "Revenues" shall mean (a)
all amounts paid or payable by the Partnership under the Senior Partnership
Upstream Note, the TCHI Note Indenture, or the Senior Partnership Upstream Note
Mortgage, and (b) the net proceeds realized
-3-
<PAGE>
upon or as a result of the enforcement of any mortgage lien, security interest
or assignment of leases granted or assigned under the Assigned Properties or
this Senior TCHI Assignment or upon or as a result of the exercise of any right
or remedy under the Assigned Properties or this Senior TCHI Assignment.
Section 3.04. Confirmation. Assignor hereby agrees, and the Partnership
hereby acknowledges, that the Partnership may rely exclusively on Assignee's
directive that Assignee is entitled to take action under this Senior TCHI
Assignment.
ARTICLE IV
DEFAULT PROVISIONS AND REMEDIES
Section 4.01. Enforcement of Remedies.
(a) Upon the occurrence and continuance of any Event of Default (as such
term is defined in the TCHI Note Indenture or the Senior Partnership Upstream
Note Mortgage; each an "Event of Default"), Assignee may (upon the direction of
the Holders or, if the rights of the Holders would be prejudiced by any delay in
taking such action, without the direction of the Holders), at its option, (i)
proceed directly to protect and enforce its rights and the rights of any Holders
under this Senior TCHI Assignment or pursuant to the Assigned Properties, or any
one of them, by such suits, actions or special proceedings in equity or at law,
or by proceedings in the office of any board or officer having jurisdiction,
either for the specific performance of any covenant or agreement contained
herein, or in the Assigned Properties, or any of them, or in aid of execution of
any power granted herein or pursuant to the Assigned Properties, or any one of
them, or for the enforcement of any proper legal or equitable remedy, including,
without limitation, foreclosure of the Senior Partnership Upstream Note Mortgage
and/or the sale of the collateral or any part thereof secured thereby at such
foreclosure sale, subject to statutory and other legal requirements, as Assignee
shall deem most effective to protect and enforce such rights, and Assignor
hereby appoints Assignee as its lawful attorney-in-fact (such power being
coupled with an interest) in the name of Assignor or Assignee or both to
effectuate such foreclosure and/or sale of such collateral or part thereof; or
(ii) instruct, direct and cause Assignor to effectuate the foregoing on behalf
of and for the benefit of Assignee and the Holders, it being further understood
that the Partnership joins in the execution of this Senior TCHI Assignment in
order to acknowledge its agreement to promptly and duly execute and deliver any
and all documents and take any and all actions required by Assignee in order to
permit Assignee to foreclose and/or sell such collateral or part thereof, and
obtain the benefits of this Senior TCHI Assignment, as aforesaid.
(b) Upon the occurrence and continuance of any such Event of Default,
Assignee shall (upon the direction of the Holders or, if the rights of the
Holders would be prejudiced by any delay in taking such action, without the
direction of the Holders) be entitled to sue for, enforce payment of and receive
any and all amounts then and at any time remaining due from Assignor
-4-
<PAGE>
or the Partnership for principal and interest on the Senior Partnership Upstream
Note, or other sums due under the Senior Partnership Upstream Note Mortgage or
the TCHI Note Indenture, as the case may be, or otherwise under any of the
provisions of the Assigned Properties, or any of them, in any of such events
with interest on overdue payments of such principal, as set forth in the Senior
Partnership Upstream Note, from the date of such Event of Default to the date of
such payment, together with any and all fees, costs and expenses of collection
(including reasonable attorneys' fees and court costs), subject to statutory and
other legal requirements.
(c) Regardless of the occurrence of an Event of Default, Assignee may
institute and maintain or cause in the name of Assignor or Assignee or both to
be instituted and maintained such suits and proceedings as Assignee may be
advised by its counsel shall be necessary and appropriate to prevent any
impairment of the Assigned Properties, or any of them, and to protect its
interests in the Assigned Properties, and in the rents, issues, rights, revenues
and other income arising therefrom, including power to institute and maintain
proceedings to restrain the enforcement or compliance with any governmental
enactment, rule or order that may be unconstitutional or otherwise invalid, if
the enforcement of or compliance with such enactment, rule or order would impair
the security hereunder or would be materially prejudicial to the interest of the
Assignee.
(d) Nothing contained in this Article IV is intended to grant Assignee any
greater remedies and rights than those allowed to Assignor in the respective
Assigned Properties. In the event or any conflict between the remedies and
rights contained in any of the Assigned Properties and the remedies and rights
contained in this Article IV, the remedies and rights set forth in the
applicable Assigned Property shall govern.
ARTICLE V
DISCHARGE OF SENIOR TCHI ASSIGNMENT
Section 5.01. Discharge of Senior TCHI Assignment. If Assignor shall pay
or cause to be paid, or there shall otherwise be paid, to Assignee and/or the
Holders, all amounts required to be paid by Assignor pursuant to the TCHI Note
Indenture and the TCHI Notes, and the conditions precedent for the TCHI Note
Indenture to cease, determine and become null and void (except for any surviving
rights of transfer or exchange of the TCHI Notes and any right to receive
payments of principal and interest as provided in Article Thirteen or Section
10.3 of the TCHI Note Indenture) in accordance with Article Thirteen of the TCHI
Note Indenture, Assignee shall promptly cancel and discharge of record this
Senior TCHI Assignment and any financing statements filed in connection herewith
and execute and deliver to Assignor and to the Partnership all such instruments
as may be appropriate to evidence such discharge and satisfaction of any lien or
liens, and Assignee shall pay over or deliver to Assignor all other moneys and
securities held by it pursuant to this Senior TCHI Assignment, which are not
required for the payment of (a) principal and redemption price, if applicable,
of and interest on,
-5-
<PAGE>
the TCHI Notes and (b) and all other amounts required to be paid by Assignor
pursuant to the TCHI Note Indenture and the TCHI Notes.
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.01. Binding Successors and Assigns. All of the covenants,
stipulations, obligations and agreements contained in this Senior TCHI
Assignment shall be binding upon and inure to the benefit of Assignor, Assignee
and the Partnership and their respective successors and assigns.
Section 6.02. Notices.
Any request, notice, demand, authorization, direction, request or other
instrument authorized or required by this Senior TCHI Assignment to be given to
or filed with Assignor, Assignee, or the Partnership (collectively "Notices")
shall be deemed given when either (i) delivered by hand (including by overnight
courier) or (ii) two days after sending by registered or certified mail, postage
prepaid, addressed as follows:
(i) To Assignee:
U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55010
Attention: Corporate Trust Administration
(ii) To Assignor:
Trump's Castle Hotel & Casino, Inc.
Trump Marina Hotel Casino
Brigantine Boulevard at Huron Avenue
Atlantic City, New Jersey 08401
Attention: Chief Executive Officer
(iii) To the Partnership:
Trump's Castle Associates, L.P.
Trump Marina Hotel Casino
Brigantine Boulevard at Huron Avenue
Atlantic City, New Jersey 08401
Attention: Chief Executive Officer
-6-
<PAGE>
and and after May 26, 1998:
Willkie Farr & Gallagher Willkie Farr & Gallagher
One Citicorp Center 787 Seventh Avenue
153 East 53rd Street New York, NY 10019-6099
New York, New York 10022 Attn: Daniel D. Rubino, Esq.
Attn: Daniel D. Rubino, Esq.
(b) By Notice to the Partnership, Assignor and or Assignee, given as
provided above, any party may designate additional or substitute addresses for
Notices, which shall, notwithstanding Subsection (a) above, be deemed given when
received.
Section 6.04. Partial Invalidity. In case any one or more of the
provisions of this Senior TCHI Assignment shall for any reason be held to be
illegal or invalid, such illegality or invalidity shall not affect any other
provision of this Senior TCHI Assignment, but this Senior TCHI Assignment shall
be construed and enforced at the time as if such illegal or invalid provisions
had not been contained herein or therein, nor shall such illegality or
invalidity or any application thereof affect any legal and valid application
herein or thereof from time to time.
Section 6.05. Applicable Law. This Senior TCHI Assignment shall be
governed by and construed under the internal laws of the State of New Jersey,
without giving effect to the principles of conflicts of law.
Section 6.06. No Amendments. For so long as the TCHI Notes shall remain
outstanding, this Senior TCHI Assignment may not be modified, amended or
terminated except in accordance with the provisions of the TCHI Note Indenture
or the Assigned Properties.
Section 6.07. Casino Control Act. Each of the provisions of this Senior
TCHI Assignment is subject to and shall be enforced in compliance with the
provisions of the New Jersey Casino Control Act.
Section 6.08. Limitation on Liability. Notwithstanding anything herein or
any other agreement, document, certificate, instrument, statement or omission
referred to below to the contrary, the Partnership and the Assignor are liable
hereunder only to the extent of the assets of the Partnership and the interest
of the Assignor in the Assigned Properties which are secured by the
Partnership's assets and no other person or entity, including, but not limited
to, any partner, officer, representative, committee or committee member of the
Partnership or any partner therein or of any Affiliate (as defined in the
Indenture) of the Partnership or any incorporator, officer, director or
shareholder of the Assignor, of any corporate partner of the Partnership, or of
any corporate Affiliate of the Partnership, or any Affiliate or controlling
person or entity of any of the foregoing, or any agent, employee or lender of
any of the foregoing or any successor, personal representative, heir or assign
of any of the foregoing, in each case past, present or as they may
-7-
<PAGE>
exist in the future, shall be liable in any respect (including without
limitation for the breach of any representation, warranty, covenant, agreement,
condition or indemnification or contribution undertaking contained herein or
therein) under, in connection with, arising out of or relating to this Senior
TCHI Assignment, or any other agreement, document, certificate, instrument or
statement (oral or written) related to, executed or to be executed, delivered or
to be delivered, or made or to be made, or any omission made or to be made, in
connection with any of the foregoing or any of the transactions contemplated in
any such agreement, document, certificate, instrument or statement. Any
agreement, document, certificate, statement or other instrument to be executed
simultaneously with, in connection with, arising out of or relating to this
Senior TCHI Assignment or any other agreement, document, certificate, statement
or instrument referred to above, or any agreement, document, certificate,
statement or instrument contemplated hereby shall contain language mutatis
mutandis to this paragraph and, if such language is omitted, shall be deemed to
contain such language.
6.09. Indemnification. Assignor agrees to indemnify Assignee for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of this Senior TCHI Assignment, including the costs
and expenses of defending itself against any claim, or with the exercise or
performance of any of its powers or duties hereunder.
-8-
<PAGE>
IN WITNESS WHEREOF, Assignor, Assignee, and the Partnership have executed
this Senior TCHI Assignment as of the date first above written.
TRUMP'S CASTLE HOTEL & CASINO, INC.., a New
Jersey corporation
Witness: /s/ Henry Smokler By: /s/ R. Bruce McKee
--------------------- ---------------------------------
Henry Smokler Name: R. Bruce McKee
Title: Vice President
TRUMP'S CASTLE ASSOCIATES, L.P.
a New Jersey limited partnership
By: Trump's Castle Hotel & Casino, Inc.,
its general partner
Witness: /s/ Henry Smokler By: /s/ R. Bruce McKee
--------------------- ---------------------------------
Henry Smokler Name: R. Bruce McKee
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the TCHI Note Indenture
Witness: /s/ Beth Anisman By: /s/ Richard H. Prokosch
--------------------- ---------------------------------
Beth Anisman Name: Richard H. Prokosh
Title: Assistant Vice President
-9-
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared R.
Bruce McKee, the Vice President of TRUMP'S CASTLE HOTEL & CASINO, INC., who I am
satisfied is the person who executed the within instrument and he acknowledged
that he signed and delivered the same as such officer on behalf of such entity
and that the within instrument is the voluntary act and deed of said corporation
made by virtue of the authority of its board of directors.
/s/ Matthew T. Collins
- ---------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-10-
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared R.
Bruce McKee, the Vice President of TRUMP'S CASTLE HOTEL & CASINO, INC., the
general partner of TRUMP'S CASTLE ASSOCIATES, L.P., who I am satisfied is the
person who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such entity and that the within
instrument is the voluntary act and deed of said corporation made by virtue of
the authority of its board of directors.
/s/ Matthew T. Collins
- ----------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-11-
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on this 17th day of April, 1998, before me the
subscriber, a Notary Public of the State of New York, personally appeared
RICHARD H. PROKOSCH, an Assistant Vice President of U.S. BANK NATIONAL
ASSOCIATION, a national banking association, who, I am satisfied, is the person
who executed the within instrument and he acknowledged that he signed and
delivered the same as such officer on behalf of such association and that the
within instrument is the voluntary act and deed of said association made by
virtue of the authority of its board of directors.
/s/ Reese M. Heitner
- -------------------------
Notary Public of the State of New York
My Commission Expires:
(NOTARIAL SEAL)
-12-
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000770618
<NAME> Trump's Castle Funding, Inc.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 313,555
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 200
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 313,555
<SALES> 0
<TOTAL-REVENUES> 11,544
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (11,544)
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000911534
<NAME> Trump's Castle Associates, L.P.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 22,331
<SECURITIES> 0
<RECEIVABLES> 8,445<F1>
<ALLOWANCES> 0
<INVENTORY> 2,867
<CURRENT-ASSETS> 1,305
<PP&E> 521,401
<DEPRECIATION> (25,908)
<TOTAL-ASSETS> 545,557
<CURRENT-LIABILITIES> 64,422
<BONDS> 286,555
0
0
<COMMON> 200
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 545,557
<SALES> 0
<TOTAL-REVENUES> 66,603
<CGS> 0
<TOTAL-COSTS> 57,386
<OTHER-EXPENSES> 4,050
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (12,615)
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,220)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> ASSET VALUES REPRESENT NET AMOUNTS
</FN>
</TABLE>
