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Exhibit 10.1
AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT ("Credit Agreement") is made and
entered into as of the 15th day of August, 2000, by and among MTR GAMING GROUP,
INC., a Delaware corporation ("MTRI"), MOUNTAINEER PARK, INC., a West Virginia
corporation ("MPI"), SPEAKEASY GAMING OF LAS VEGAS, INC., a Nevada corporation
("SGLVI") and SPEAKEASY GAMING OF RENO, INC., a Nevada corporation ("SGRI" and
together with MTRI, MPI and SGLVI, collectively referred to as the "Borrowers"),
each financial institution whose name is set forth on the signature pages of
this Credit Agreement and each lender which may hereafter become a party to this
Credit Agreement pursuant to Section 10.10(b) (each individually a "Lender" and
collectively the "Lenders"), WELLS FARGO BANK, National Association, as the
swingline lender (herein in such capacity, together with its successors and
assigns, the "Swingline Lender"), PNC BANK, National Association, as the
documentation agent ("Documentation Agent") and WELLS FARGO BANK, National
Association, as administrative and collateral agent for the Lenders and
Swingline Lender (herein, in such capacity, called the "Agent Bank" and,
together with the Lenders and Swingline Lender collectively referred to as the
"Banks").
R E C I T A L S:
WHEREAS:
A. In this Credit Agreement all capitalized words and terms shall have the
respective meanings and be construed herein as hereinafter provided in Section
1.01 of this Credit Agreement and shall be deemed to incorporate such words and
terms as a part hereof in the same manner and with the same effect as if the
same were fully set forth.
B. MPI, SGLVI and SGRI are wholly owned subsidiaries of MTRI. As of the
date hereof, Borrowers are indebted to WFB under the terms of the Existing
Credit Facility and Existing Credit Agreement.
C. The Borrowers desire to fully amend and restate the Existing Credit
Facility as a revolving credit facility in the amount of Sixty Million Dollars
($60,000,000.00), the proceeds of which will be used for general corporate
purposes.
D. Lenders are willing to establish the Credit Facility in favor of the
Borrower Consolidation in the principal amount of Sixty Million Dollars
($60,000,000.00)
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at any time outstanding, all on the terms and subject to the conditions,
covenants and understandings hereinafter set forth and contained in each of the
Loan Documents.
NOW, THEREFORE, in consideration of the foregoing, and other valuable
considerations as hereinafter described, the parties hereto do promise, covenant
and agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. DEFINITIONS. For the purposes of this Credit Agreement,
each of the following terms shall have the meaning specified with respect
thereto, unless a different meaning clearly appears from the context:
"Adjusted Fixed Charge Coverage Ratio" as of the end of any Fiscal Quarter
shall mean with reference to the Borrower Consolidation:
For the Fiscal Quarter under review, together with the most recently ended
three (3) preceding Fiscal Quarters, the sum of: (i) EBITDA, less (ii) the
aggregate amount of Distributions actually paid, less (iii) the aggregate
amount of actually paid federal and state taxes on or measured by income,
less (iv) the aggregate amount of Non-Financed Capital Expenditures
Divided by ())
The sum of: (i) Interest Expense (expensed and capitalized) determined for
the Fiscal Quarter under review together with the most recently ended three
(3) preceding Fiscal Quarters, plus (ii) the current portion of all
interest bearing Indebtedness as of the end of the Fiscal Quarter under
review, plus (iii) the current portion of Capitalized Lease Liabilities as
of the end of the Fiscal Quarter under review.
"Affiliate", as applied to any Person, means any other Person directly or
indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise.
"Agent Bank" shall mean WFB in its capacity as administrative and
collateral agent for Lenders.
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"Aggregate Commitment" shall mean reference to the aggregate amount
committed by Lenders for advance to or on behalf of the Borrower Consolidation
during the Revolving Credit Period as Borrowings under the Credit Facility up to
the maximum amount of Sixty Million Dollars ($60,000,000.00) at any time
outstanding, subject to the limitations for advance as set forth in the
definition of Maximum Permitted Balance.
"Aggregate Outstandings" shall mean collective reference to the sum of the
Funded Outstandings and Swingline Outstandings as of any given date of
determination.
"Applicable Margin" means for any Base Rate Loan or LIBOR Loan, the
applicable percentage amount to be added to the Base Rate or LIBO Rate, as the
case may be, as follows: (i) commencing on the Closing Date and continuing until
the Rate Adjustment Date, the Applicable Margins as calculated on the Pricing
Certificate to be delivered by Borrowers to Agent Bank on the Closing Date
pursuant to Section 3.04 and; (ii) commencing on the Rate Adjustment Date and
continuing until Credit Facility Termination, the margin rates as set forth in
Table One below in each instance based on the Leverage Ratio calculated with
regard to the Borrower Consolidation as of each Fiscal Quarter end, commencing
with the Fiscal Quarter ending September 30, 2000, together with the immediately
preceding three (3) Fiscal Quarters on a four (4) Fiscal Quarter basis, any
change in the applicable percentage amount by reason thereof to be effective as
of the 1st day of the third (3rd) month immediately following each such Fiscal
Quarter end:
<TABLE>
<CAPTION>
===========================================================================================================
TABLE ONE TABLE TWO
===========================================================================================================
LIBO
BASE RATE RATE COMMITMENT
LEVERAGE RATIO MARGIN MARGIN PERCENTAGE
===========================================================================================================
<S> <C> <C> <C>
Greater than or equal to 2.00 to 1.00 1.25% 2.50% 0.50%
===========================================================================================================
Greater than or equal to 1.50 to 1.0 but less than 2.00 1.00% 2.25% 0.375%
to 1.00
===========================================================================================================
Greater than or equal to 1.00 to 1.0 but less than 1.50 0.75% 2.00% 0.375%
to 1.00
===========================================================================================================
Less than 1.00 to 1.00 0.25% 1.50% 0.375%
===========================================================================================================
</TABLE>
"Arneault" shall mean Edson (Ted) Arneault, an individual, President and
Chief Executive Officer of MTRI as of the Closing Date.
"Assets" shall mean the total assets of the Borrower Consolidation
determined in accordance with GAAP.
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"Assignment and Assumption Agreement" shall mean the document evidencing an
assignment of a Syndication Interest by any Lender to an Eligible Assignee in
the form of the Assignment, Assumption and Consent Agreement marked "Exhibit H",
affixed hereto and by this reference incorporated herein and made a part hereof.
"Assignments" shall mean collective reference to the MPI Assignment of
Entitlements, Contracts, Rents and Revenues, SGLVI Assignment of Entitlements,
Contracts, Rents and Revenues and SGRI Assignment of Entitlements, Contracts,
Rents and Revenues.
"Authorized Officer(s)" shall mean, relative to the Borrower Consolidation,
those of the respective officers whose signatures and incumbency shall have been
certified to Agent Bank and the Banks as required in Section 3.05(iv) of the
Credit Agreement with the authority and responsibility to deliver Notices of
Borrowing, Notice of Swingline Advances, Continuation/Conversion Notices,
Pricing Certificates, Compliance Certificates and all other requests, notices,
reports, consents, certifications and authorizations on behalf of Borrowers and
the Borrower Consolidation.
"Available Borrowings" shall mean, at any time, and from time to time, the
aggregate amount available to Borrowers for a Borrowing not exceeding the amount
of the Maximum Availability, as of each date of determination.
"Bank Facilities" shall mean collective reference to the Credit Facility
and Swingline Facility.
"Banking Business Day" means (a) with respect to any Borrowing, payment or
rate determination of LIBOR Loans, a day, other than a Saturday or Sunday, on
which Agent Bank is open for business in San Francisco and on which dealings in
Dollars are carried on in the London interbank market, and (b) for all other
purposes any day excluding Saturday, Sunday and any day which is a legal holiday
under the laws of the States of California and/or Nevada, or is a day on which
banking institutions located in California and/or Nevada are required or
authorized by law or other governmental action to close.
"Bankruptcy Code" shall mean the United States Bankruptcy Code, as amended,
11 U.S.C. Section 101, ET SEQ.
"Banks" shall have the meaning set forth in the Preamble to this Credit
Agreement.
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"Base Rate" shall mean, as of any date of determination, the rate per annum
equal to the higher of (a) the Prime Rate in effect on such date and (b) the
Federal Funds Rate in effect on such date plus one-half of one percent
(1/2 of 1%) (fifty basis points).
"Base Rate Loan" shall mean reference to that portion of the unpaid
principal balance of the Credit Facility bearing interest with reference to the
Base Rate plus the Applicable Margin.
"Borrower Consolidation" shall mean collective reference to Borrowers and
each Subsidiary created in accordance with Section 6.16 on a consolidated basis.
"Borrowers" shall mean collective reference to MTRI, MPI, SGLVI and SGRI.
"Borrowing(s)" shall mean collective reference to such amounts as Borrowers
may request from time to time to be advanced under the Credit Facility by Notice
of Borrowing in the manner provided in Section 2.03.
"Breakage Charges" shall have the meaning set forth in Section 2.07(c) of
the Credit Agreement.
"Capital Expenditures" shall mean, for any period, without duplication, the
aggregate of all expenditures (whether paid in cash or accrued as liabilities
during that period and including Capitalized Lease Liabilities) by a Borrower or
the Borrower Consolidation, as the context may require, during such period that,
in conformity with GAAP, are required to be included in or reflected by the
property, plant or equipment or similar fixed or capital asset accounts
reflected in the balance sheet of a Borrower or the Borrower Consolidation, as
the context may require (including equipment which is purchased simultaneously
with the trade-in of existing equipment owned by Borrower or the Borrower
Consolidation, as the context may require, to the extent of (a) the gross amount
of such purchase price LESS (b) the cash proceeds of trade-in credit of the
equipment being traded in at such time), but excluding capital expenditures made
in connection with the replacement or restoration of assets, to the extent
reimbursed or refinanced from insurance proceeds paid on account of the loss of
or damage to the assets being replaced or restored, or from awards of
compensation arising from the taking by condemnation of or the exercise of the
power of eminent domain with respect to such assets being replaced or restored.
"Capital Proceeds" shall mean the proceeds received by the Borrower
Consolidation from (i) partial or total condemnation or destruction of any part
of the Collateral, (ii) insurance proceeds (other than rent insurance and
business interruption insurance) received in connection with damage to or
destruction of the Collateral, and (iii) the sale, transfer, conveyance or other
disposition of any portion of the Collateral in
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accordance with the provisions of this Credit Agreement (not including, however,
any proceeds received by Borrowers, or any of them, from a sale, condemnation,
damage or destruction of FF&E or other personal property if such FF&E or other
personal property is replaced by items of equivalent value and utility, in each
case such exclusion to apply only during any period in which no Default or Event
of Default has occurred and is continuing).
"Capitalized Lease Liabilities" means all monetary obligations of the
Borrower Consolidation under any leasing or similar arrangement which, in
accordance with GAAP, would be classified as capitalized leases, and, for
purposes of this Credit Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP, and the stated
maturity thereof shall be the date of the last payment of rent or any other
amount due under such lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty.
"Cash" shall mean, when used in connection with any Person, all monetary
and non-monetary items owned by that Person that are treated as cash in
accordance with GAAP.
"Cash Equivalents" shall mean, when used in connection with any Person,
that Person's Investments in:
(a) Government Securities due within one (1) year after the date of
the making of the Investment;
(b) readily marketable direct obligations of any State of the United
States of America given on the date of such Investment a credit rating of
at least Aa by Moody's Investors Service, Inc. or AA by Standard & Poor's
Corporation, in each case due within one (1) year from the making of the
Investment;
(c) certificates of deposit issued by, bank deposits in, eurodollar
deposits through, bankers' acceptance of, and repurchase agreements
covering Government Securities executed by, United National Bank of West
Virginia or any bank incorporated under the laws of the United States of
America or any State thereof and having on the date of such Investment
combined capital, surplus and undivided profits of at least Two Hundred
Fifty Million Dollars ($250,000,000.00), or total assets of at least Five
Billion Dollars ($5,000,000,000.00), in each case due within one (1) year
after the date of the making of the Investment;
(d) certificates of deposit issued by, bank deposits in, eurodollar
deposits through, bankers' acceptances of, and repurchase agreements
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covering Government Securities executed by, any branch or office located in
the United States of America of a bank incorporated under the laws of any
jurisdiction outside the United States of America having on the date of
such Investment combined capital, surplus and undivided profits of at least
Five Hundred Million Dollars ($500,000,000.00), or total assets of at least
Fifteen Billion Dollars ($15,000,000,000.00) in each case due within one
year after the date of the making of the Investment;
(e) repurchase agreements covering Government Securities executed by a
broker or dealer registered under Section 15(b) of the Securities Exchange
Act of 1934 having on the date of the Investment capital of at least One
Hundred Million Dollars ($100,000,000.00), due within thirty (30) days
after the date of the making of the Investment; PROVIDED that the maker of
the Investment receives written confirmation of the transfer to it of
record ownership of the Government Securities on the books of a "primary
dealer" in such Government Securities on the books of such registered
broker or dealer, as soon as practicable after the making of the
Investment;
(f) readily marketable commercial paper of corporations doing business
in and incorporated under the laws of the United States of America or any
State thereof or of any corporation that is the holding company for a bank
described in clauses (c) or (d) above given on the date of such Investment
a credit rating of at least P-1 by Moody's Investors Service, Inc. or A-1
by Standard & Poor's Corporation, in each case due within three hundred
sixty-five (365) days after the date of the making of the Investment;
(g) "money market preferred stock" issued by a corporation
incorporated under the laws of the United States of America or any State
thereof given on the date of such Investment a credit rating of at least Aa
by Moody's Investors Service, Inc. or AA by Standard & Poor's Corporation,
in each case having an investment period not to exceed fifty (50) days;
PROVIDED that (i) the amount of all such Investments issued by the same
issuer does not exceed Five Million Dollars ($5,000,000.00) and (ii) the
aggregate amount of all such Investments does not exceed Fifteen Million
Dollars ($15,000,000.00); and
(h) a readily redeemable "money market mutual fund" sponsored by a
bank described in clauses (c) or (d) hereof, or a registered broker or
dealer described in clause (e) hereof, that has and maintains an investment
policy limiting its investments primarily to instruments of the types
described in clauses (a) through (g) hereof and having on the date of such
Investment total assets of at least One Billion Dollars
($1,000,000,000.00).
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"Change of Control" shall mean the occurrence of any of the following:
(a) Any "person" or "group" (as such terms are defined in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) other
than any such "person" or "group" which is or which includes the holders of
the common stock (voting and non-voting) of MTRI as of the Closing Date or
their Affiliates, own or control, more than forty percent (40%) of the
common voting stock of MTRI; or
(b) During any period of twenty-four (24) consecutive months
commencing after the Closing Date, individuals who at the beginning of such
period constituted MTRI's Board of Directors (together with any new or
replacement directors whose election by MTRI's Board of Directors or whose
nomination for election by MTRI's shareholders, was approved by a vote of
at least a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute
a majority of the directors then in office; or
(c) MTRI fails to own, directly or indirectly, one hundred percent
(100%) of the capital stock interests of MPI, SGLVI and SGRI.
"Closing Date" shall mean the date upon which: (i) each requirement set
forth in Article IIIA of this Credit Agreement has been satisfied or waived and
(ii) the Security Document Amendments have been filed and/or recorded in
accordance with and in the manner required by the Closing Instructions.
"Closing Disbursements" shall have the meaning set forth by
Section 2.02(a).
"Closing Instructions" shall mean a collective reference to the SGLVI
Closing Instructions, the SGRI Closing Instructions and the MPI Closing
Instructions.
"Collateral" shall mean: (a) a collective reference to the MPI Collateral,
SGLVI Collateral and the SGRI Collateral; and (b) any and all other property
and/or intangible rights, interests or benefits inuring to or in favor of
Borrowers which are in any manner assigned, pledged, encumbered or otherwise
hypothecated in favor of Lenders or Agent Bank on behalf of the Lenders to
secure repayment of the Credit Facility.
"Collateral Properties" shall mean collective reference to the real
properties, improvements and associated FF&E which are pledged and encumbered as
Collateral
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securing repayment of the Credit Facility from time to time, which shall consist
of the MPI Real Property, SGLVI Real Property and SGRI Real Property, together
with any other real property or interests therein which may be held by Agent
Bank from time to time to secure repayment of the Credit Facility.
"Commitment Fee" shall have the meaning ascribed to such term in
Section 2.09(b) of this Credit Agreement.
"Compliance Certificate" shall mean a compliance certificate as described
in Section 5.08(e) which is more particularly described on "Exhibit D", affixed
hereto and by this reference incorporated herein and made a part hereof.
"Contingent Liability(ies)" shall mean, as to any Person any obligation of
such Person guaranteeing or having the economic effect of guaranteeing any
Indebtedness, leases or dividends ("primary obligations") of any other Person
that is not a Borrower hereunder (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (a) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (b) to
advance or supply funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (c) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation, (d) to make
payment in respect of any net liability arising in connection with any Interest
Rate Hedges, foreign currency exchange agreement, commodity hedging agreement or
any similar agreement or arrangement in any such case if the purpose or intent
of such agreement is to provide assurance that such primary obligation will be
paid or discharged, or that any agreements relating thereto will be complied
with, or that the holders of such primary obligation will be protected (in whole
or in part) against loss in respect thereof or (e) otherwise to assure or hold
harmless the holder of such primary obligation against loss in respect thereof;
provided, however, that the term Contingent Liability shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business, trade payables incurred in the ordinary course of business and less
than ninety (90) days in arrears or any obligations under the SABAL Loan. The
amount of any Contingent Liability shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Liability is made or, if not stated or determinable, the reasonably
anticipated liability in respect thereof (assuming such Person is required to
perform thereunder) as determined by such Person in good faith.
"Continuation/Conversion Notice" shall mean a notice of continuation of or
conversion to a LIBOR Loan and certificate duly executed by an Authorized
Officer,
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substantially in the form of that certain exhibit marked "Exhibit C", affixed
hereto and by this reference incorporated herein and made a part hereof.
"Convert, Conversion and Converted" shall refer to a Borrowing at or
continuation of a particular interest rate basis or conversion of one interest
rate basis to another pursuant to Section 2.05(c).
"Credit Agreement" shall mean this Credit Agreement together with all
Schedules and Exhibits attached thereto, executed by and among Borrowers and
Banks setting forth the terms and conditions of the Credit Facility, as may be
amended, modified, extended, renewed or restated from time to time.
"Credit Facility" shall mean the agreement of Lenders to fund a revolving
line of credit during the Revolving Credit Period subject to the terms and
conditions set forth in this Credit Agreement and the Revolving Credit Note, up
to the Maximum Permitted Balance as reduced from time to time in accordance with
the terms of this Credit Agreement and the Revolving Credit Note.
"Credit Facility Termination" shall mean indefeasible payment in full of
all sums owing under the Credit Facility and each of the Loan Documents and the
irrevocable termination of the obligation of Lenders to advance Borrowings under
the Credit Facility and of Swingline Lender to advance Swingline Advances under
the Swingline Facility.
"Deeds of Trust" shall mean collective reference to the MPI Deed of Trust,
SGLVI Deed of Trust and SGRI Deed of Trust.
"Default" shall mean the occurrence or non-occurrence, as the case may be,
of any event that with the giving of notice or passage of time, or both, would
become an Event of Default.
"Default Rate" shall have the meaning set forth in Section 2.10(b) with
respect to defaults occurring under the Revolving Credit Note and shall mean the
Prime Rate plus the then Applicable Margin plus two percent (2%) per annum for
all other purposes.
"Defaulting Lender" means any Lender which fails or refuses to perform its
obligations under this Credit Agreement within the time period specified for
performance of such obligation or, if no time frame is specified, if such
failure or refusal continues for a period of five (5) Banking Business Days
after notice from Agent Bank.
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"Designated Deposit Account" shall mean a deposit account to be maintained
by Borrowers with Agent Bank, as from time to time designated in writing by an
Authorized Officer.
"Dispute" shall have the meaning set forth in Section 10.14(a).
"Distributions" shall mean and collectively refer to any and all cash
dividends on stock, loans, management fees, payments, advances or other
distributions, fees or compensation of any kind or character whatsoever, other
than within the Borrower Consolidation, but shall not include consideration paid
for tangible and intangible assets in an arms length exchange for fair market
value, trade payments made and other payments for liabilities incurred in the
ordinary course of business or compensation to officers, directors and employees
of Borrowers in the ordinary course of business.
"Documents" shall have the meaning set forth in Section 10.14(a).
"Dollars" and "$" means the lawful money of the United States of America.
"EBITDA" shall mean with reference to any Person, for any fiscal period
under review, the sum of (i) Net Income for that period, less (ii) any one-time
non-Cash gain reflected in such Net Income, plus (iii) any losses on sales of
assets and other extraordinary losses and one-time non-Cash charges, plus
(iv) Interest Expense (expensed and capitalized) for that period, plus (v) the
aggregate amount of federal and state taxes on or measured by income for that
period (whether or not payable during that period), plus (vi) depreciation,
amortization and all other non-cash expenses for that period, plus
(vii) preopening expenses for that period, in each case determined in accordance
with GAAP and, in the case of items (iii), (iv), (v), (vi) and (vii), only to
the extent deducted in the determination of Net Income for that period.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eligible Assignee" means (a) another Lender, (b) with respect to any
Lender, any Affiliate of that Lender and (c) any commercial bank having a
combined capital and surplus of Fifty Million Dollars ($50,000,000.00) or more
that is (i) organized under the Laws of the United States of America, any State
thereof or the District of Columbia or (ii) organized under the Laws of any
other country which is a member of the Organization for Economic Cooperation and
Development, or a political subdivision of such a country, PROVIDED that
(A) such bank is acting through a branch or agency located in the United States
of America and (B) is otherwise exempt from withholding of tax on interest and
delivers Form 1001 or Form 4224 at the time of any assignment.
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"Environmental Certificate" shall mean the Certificate and Indemnification
Regarding Hazardous Substances which was executed by Borrowers on December 20,
1999 as a further inducement to the Banks to establish the Existing Credit
Facility as well as all restatements, amendments and other modifications
thereto, as such certificate may be amended, modified, extended, renewed or
restated from time to time.
"Equipment Leases and Contracts" shall mean collective reference to the MPI
Equipment Leases and Contracts, SGLVI Equipment Leases and Contracts and SGRI
Equipment Leases and Contracts.
"Equity Offering" shall mean the issuance and sale of shares of common
voting stock by MTRI to the public after the Closing Date in exchange for Cash
or Cash Equivalents.
"Event of Default" shall mean any event of default as defined in
Section 7.01 hereof.
"Excess Capital Proceeds" shall have the meaning ascribed to such term in
Section 5.01 of this Credit Agreement.
"Existing Credit Agreement" shall mean that certain Credit Agreement dated
as of December 20, 1999, as amended by the First Amendment to Credit Agreement
dated as of June 1, 2000 and Second Amendment to Credit Agreement dated as of
July 31, 2000, each executed by and between Borrowers and Wells Fargo Bank,
National Association, as the lender and agent bank.
"Existing Credit Facility" shall mean the revolving line of credit up to
the maximum principal amount of Thirty-Eight Million Five Hundred Thousand
Dollars ($38,500,000.00) at any time outstanding, evidenced by the Existing
Credit Agreement.
"Existing MPI Deed of Trust" shall mean the Credit Line Deed of Trust,
Fixture Filing and Security Agreement with Assignment of Rents (MPI) which was
executed by MPI in favor of Agent Bank, on behalf of Lenders, on December 20,
1999 and recorded the Official Records of Hancock County, West Virginia on
December 27, 1999 in Trust Book No. 395 at Page 468 as Document No. 020482, as
amended by that certain First Amendment to A Credit Line Deed of Trust, Fixture
Filing and Security Agreement with Assignment of Rents and Notice of Additional
Commitment (MPI) which was executed by MPI and Agent Bank on June 1, 2000 and
recorded the Official Records of Hancock County, West Virginia on June 6, 2000
in Trust Book No. 401 at Page 648 as Document No. 023849, encumbering the MPI
Real Property, the MPI FF&E and the other MPI Collateral therein described, all
for the purpose, among other things, of securing Borrowers' payment and
performance under the Existing Credit Facility.
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"Existing MPI Title Insurance Policy" shall mean the ALTA Extended Coverage
Lenders Policy of Title Insurance which was issued by Frankovitch, Anetakis,
Colontonio and Simon, as the issuing agent for the MPI Title Insurance Company
under Policy No. 442-786809 and dated as of December 27, 1999; together with:
(i) the endorsements which were issued concurrently therewith; and (ii) General
Endorsement (PA 1070), Mortgage Modification Endorsement (PA 500) and Tie-In
Endorsement, all of which were issued with respect to such policy under date of
June 6, 2000; with such policy and endorsements providing coverage in the
aggregate amount of Twenty-three Million One Hundred Thousand Dollars
($23,100,000.00), insuring the Existing MPI Deed of Trust as a first priority
mortgage lien encumbering the MPI Real Property therein described, subject only
to the exceptions shown therein.
"Existing MTRI Security Agreement" shall mean the Security Agreement (MTRI)
which was executed by MTRI, as debtor and Agent Bank, as secured party, on
December 20, 1999, as amended by that certain First Amendment to Security
Agreement (MTRI) which was executed by MTRI and Agent Bank on June 1, 2000,
encumbering the Collateral therein described, all for the purpose of providing
security for the Existing Credit Facility.
"Existing SGLVI Deed of Trust" shall mean the Deed of Trust, Fixture Filing
and Security Agreement with Assignment of Rents (SGLVI) which was executed by
SGLVI in favor of Agent Bank on behalf of the Lenders, on December 20, 1999 and
recorded in the Official Records of Clark County, Nevada on December 23, 1999 in
Book 991223 as Instrument No. 02087, as amended by that certain First Amendment
to Deed of Trust, Fixture Filing and Security Agreement with Assignment of Rents
and Notice of Additional Commitment (SGLVI), which was executed by SGLVI and
Agent Bank on June 1, 2000 and recorded in the Official Records of Clark County,
Nevada on June 5, 2000 in Book 20000605 as Instrument No. 01119, encumbering the
SGLVI Real Property, the SGLVI FF&E and the other SGLVI Collateral therein
described, all for the purpose, among other things, of securing the Borrowers'
payment and performance under the Existing Credit Facility.
"Existing SGLVI Title Insurance Policy" shall mean the ALTA Extended
Coverage Lenders Policy of Title Insurance which was issued by the SGLVI Title
Insurance Company, under Policy No. S62-327169 and dated as of December 23,
1999, together with: (i) the endorsements which were issued concurrently
therewith; and (ii) the Modification and Additional Advance Agreement
Endorsement (Special 254) and Tie-In Endorsement which were issued with respect
to such policy under date of June 6, 2000; with such policy and endorsements
providing coverage in the aggregate amount of Nine Million Six Hundred
Twenty-five Thousand Dollars ($9,625,000.00), insuring the
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Existing SGLVI Deed of Trust as a first priority mortgage lien encumbering
the SGLVI Real Property therein described subject only to the exceptions
shown therein.
"Existing SGRI Deed of Trust" shall mean the Deed of Trust, Fixture Filing
and Security Agreement with Assignment of Rents (SGRI) which was executed by
SGRI in favor of Agent Bank, on behalf of Lenders, on December 20, 1999 and
recorded in the Official Records of Washoe County, Nevada on December 23, 1999
as Document No. 2408913, as amended by that certain First Amendment to Deed of
Trust, Fixture Filing and Security Agreement with Assignment of Rents and Notice
of Additional Commitment (SGRI), which was executed by SGRI and Agent Bank on
June 1, 2000 and recorded in the Official Records of Washoe County, Nevada on
June 5, 2000 as Document No. 2453114, encumbering the SGRI Real Property, the
SGRI FF&E and the other SGRI Collateral therein described, all for the purpose,
among other things, of securing the Borrowers' payment and performance under the
Existing Credit Facility.
"Existing SGRI Title Insurance Policy" shall mean the ALTA
Extended Coverage Lenders Policy of Title Insurance which was issued by the
SGRI Title Insurance Company, under Policy No. 135-03-366623 and dated as of
December 23, 1999, together with: (i) the endorsements which were issued
concurrently therewith; and (ii) the CLTA Form 110.10 Endorsement and
Tie-In Endorsement which were issued with respect to such policy under date
of June 6, 2000; with such policy and endorsements providing coverage in the
aggregate amount of Five Million Seven Hundred Seventy-five Thousand Dollars
($5,775,000.00), insuring the Existing SGRI Deed of Trust as a first priority
mortgage lien encumbering the SGRI Real Property therein described, subject only
to the exceptions shown therein.
"Expansion Capital Expenditures" shall mean collective reference to Capital
Expenditures made to or for the benefit of or for use in connection with the
Hotel/Casino Facilities which (i) are not for the purpose of maintaining,
repairing or replacing existing assets of the Borrower Consolidation, (ii)
consist of the acquisition, construction or creation of additional assets and
improvements owned by the Borrower Consolidation, and (iii) are added as
Collateral under the Credit Facility and are encumbered by the Security
Documentation, any amendments required by Agent Bank for such purpose to be at
the expense of the Borrower Consolidation.
"FF&E" shall mean reference to the MPI FF&E, SGLVI FF&E and the SGRI FF&E
and any other furniture, fixtures and equipment, including, without limitation,
all gaming devices and associated equipment, inventories and supplies used in
connection with the Hotel/Casino Facilities.
"FIRREA" shall mean the Financial Institutions Reform, Recovery and
Enforcement Act of 1989.
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"Federal Funds Rate" means, as of any date of determination, the rate set
forth in the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Board (including any
such successor, "H.15(519)") for such date opposite the caption "Federal Funds
(Effective)". If for any relevant date such rate is not yet published in
H.15(519), the rate for such date will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the Federal
Reserve Bank of New York (including any successor, the "Composite 3:30 p.m.
Quotation") for such date under the caption "Federal Funds Effective Rate". If
on any relevant date the appropriate rate for such date is not yet published in
either H.15(519) or the Composite 3:30 p.m. Quotations, the rate for such date
will be the arithmetic mean of the rates for the last transaction in overnight
Federal funds arranged prior to 9:00 a.m. (New York City time) on that date by
each of three leading brokers of Federal funds transactions in New York City
selected by the Agent Bank. For purposes of the Credit Agreement, any change in
the Base Rate due to a change in the Federal Funds Rate shall be effective as of
the opening of business on the effective date of such change.
"Fee Side Letter" shall mean the Confidential Fee Letter dated June 8,
2000, executed by and between Borrowers and Agent Bank concerning payment of the
fees more particularly therein described.
"Financial Covenants" shall mean collective reference to the financial
covenants set forth in Article VI of this Credit Agreement.
"Financing Statements" shall mean collective reference to the MPI Financing
Statements, SGLVI Financing Statements, SGRI Financing Statements and MTRI
Financing Statements.
"Fiscal Quarter" shall mean the consecutive three (3) month periods during
each Fiscal Year beginning on January 1, April 1, July 1 and October 1 and
ending on March 31, June 30, September 30 and December 31, respectively.
"Fiscal Year" shall mean the fiscal year period beginning January 1 of each
calendar year and ending on the following December 31.
"Fiscal Year End" shall mean December 31 of each calendar year.
"Funded Debt" shall mean with reference to the Borrower Consolidation for
any period the daily average of the Funded Outstandings for such period, plus
the total as of the last day of such period of both the long-term and current
portions (without
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duplication) of all other Indebtedness (including Contingent Liabilities) and
Capitalized Lease Liabilities.
"Funded Outstandings" shall mean the unpaid principal amount outstanding on
the Credit Facility as of any given date of determination for Borrowings made
thereunder.
"Funding Date" shall mean each date upon which Lenders fund Borrowings
requested by Borrowers in accordance with the provisions of Section 2.03.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board, or in such other statements by such
other entity as may be in general use by significant segments of the accounting
profession, which are applicable to the circumstances as of the date of
determination.
"Gaming Authority(ies)" shall mean any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
the United States federal or foreign government, any state, province or any city
or other political subdivision or otherwise and whether now or hereafter in
existence or any officer or official thereof, including, without limitation,
Nevada Gaming Authorities and West Virginia Gaming Authorities, with authority
to regulate any gaming operation owned, managed or operated by the Borrower
Consolidation.
"Gaming Devices" shall mean slot machines and other devices which
constitute gaming devices and related equipment.
"Gaming Laws" means all statutes, rules, regulations, ordinances, codes and
administrative or judicial precedents pursuant to which any Gaming Authority
possesses regulatory, licensing or permit authority over gambling, gaming or
casino activities conducted by Borrowers within its jurisdiction, including the
Nevada Gaming Control Act and the West Virginia Racing Act and Lottery Act.
"Gaming Permits" shall mean collective reference to every license, permit
or other authorization required to own, operate and otherwise conduct
unrestricted gaming operations at the Hotel/Casino Facilities.
"Government Securities" means readily marketable (a) direct full faith and
credit obligations of the United States of America or obligations guaranteed by
the full faith and credit of the United States of America and (b) obligations of
an agency or instrumentality of, or corporation owned, controlled or sponsored
by, the United States of
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America that are generally considered in the securities industry to be implicit
obligations of the United States of America.
"Governmental Authority" or "Governmental Authorities" shall mean any
federal, state, regional, county or municipal governmental agency, board,
commission, officer or official whose consent or approval is required or whose
regulations must be followed as a prerequisite to (i) the continued operation
and occupancy of the Collateral Properties and the Hotel/Casino Facilities or
(ii) the performance of any act or obligation or the observance of any
agreement, provision or condition of whatever nature herein contained.
"Hard Costs" shall mean those costs which are shown in the Construction
Budgets as a "construction cost" and any adjustments to such costs pursuant to
properly approved change orders.
"Hazardous Materials Laws" shall have the meaning set forth in
Section 5.20.
"Hotel/Casino Facility" shall mean individual reference and "Hotel/Casino
Facilities" shall mean collective reference to the MPI Hotel/Casino Facilities,
SGLVI Hotel/Casino Facility and the SGRI Hotel/Casino Facility.
"Indebtedness" of any Person includes all obligations, contingent or
otherwise, which in accordance with GAAP should be classified upon such Person's
balance sheet as liabilities, but in any event including liabilities for
borrowed money or other liabilities secured by any lien existing on property
owned or acquired by such Person, Affiliate or a Subsidiary thereof (whether or
not the liability secured thereby shall have been assumed), obligations which
have been or under GAAP should be capitalized for financial reporting purposes,
and all guaranties, endorsements, and other contingent obligations with respect
to Indebtedness of others, including, but not limited to, any obligations to
acquire any of such Indebtedness, to purchase, sell, or furnish property or
services primarily for the purpose of enabling such other Person to make payment
of any of such Indebtedness, or otherwise to assure the owner of any of such
Indebtedness against loss with respect thereto.
"Insider Cash Loans" shall mean collective reference to all loans advanced
by any Borrower in Cash to any officer or director of any member of the Borrower
Consolidation, for the purpose of funding taxes payable by such officers and
directors from the purchase and sale of shares of MTRI acquired through stock
options or other employee incentive plans established by the Borrower
Consolidation.
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"Insider Non-Cash Loans" shall mean collective reference to loans made by
book entry (and not evidenced by the advance of Cash) to any officer or director
of any member of the Borrower Consolidation for the purpose of exercising stock
options for the acquisition of shares of the stock of MTRI.
"Intangibles" shall mean the aggregate goodwill, trademarks, patents,
organizational expense and other similar intangible items of the Borrower
Consolidation determined on a consolidated basis in accordance with GAAP.
"Interest Expense" shall mean with respect to any Person, as of the last
day of any fiscal period under review, the sum of (i) all interest, fees,
charges and related expenses paid or payable (without duplication but including
capitalized interest) for that fiscal period by such Person to a lender in
connection with borrowed money (including any obligations for fees, charges and
related expenses payable to the issuer of any letter of credit) or the deferred
purchase price of assets that are considered "interest expense" under GAAP, plus
(ii) the portion of the up front costs and expenses for Interest Rate Hedges (to
the extent not included in (i)) fairly allocated to such interest rate hedges as
expenses for such period, plus (iii) the portions of Capital Lease Liabilities
paid or payable with respect to such period that should be treated as interest
in accordance with GAAP.
"Interest Period(s)" shall have the meaning set forth in Section 2.05(d) of
the Credit Agreement.
"Interest Rate Hedges" shall mean, with respect to any Person, all
liabilities of such Person under interest rate swap agreements, interest rate
cap agreements, basis swap, forward rate agreement and interest collar or floor
agreements and all other agreements or arrangements designed to protect such
Person against fluctuations in interest rates or currency exchange rates.
"Interest Rate Option" shall have the meaning ascribed to such term in
Section 2.05(b) of the Credit Agreement.
"Investment" shall mean, when used in connection with any Person, any
investment by or of that Person, whether by means of purchase or other
acquisition of stock or other securities of any other Person or by means of a
loan, advance creating a debt, capital contribution, guaranty or other debt or
equity participation or interest in any other Person, INCLUDING any partnership
and joint venture interests of such Person. The amount of any Investment shall
be the amount actually invested without adjustment for subsequent increases or
decreases in the value of such Investment.
"LIBO Rate" means, relative to any LIBOR Loan Interest Period for any LIBOR
Loan included in any Borrowing, the per annum rate (reserve adjusted as
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hereinbelow provided) of interest quoted by Agent Bank, rounded upwards, if
necessary, to the nearest one-sixteenth of one percent (0.0625%) at which Dollar
deposits in immediately available funds are offered by Agent Bank to leading
banks in the London interbank market at approximately 11:00 a.m. London, England
time two (2) Banking Business Days prior to the beginning of such Interest
Period, for delivery on the first day of such Interest Period for a period
approximately equal to such Interest Period and in an amount equal or comparable
to the LIBOR Loan to which such Interest Period relates. The foregoing rate of
interest shall be reserve adjusted by dividing the applicable LIBO Rate by a one
(1.00) minus the LIBOR Reserve Percentage, with such quotient to be rounded
upward to the nearest whole multiple of one-hundredth of one percent (0.01%).
All references in this Credit Agreement or other Loan Documents to a LIBO Rate
include the aforesaid reserve adjustment.
"LIBOR Loan" shall mean each portion of the total unpaid principal under
the Credit Facility which bears interest at a rate determined by reference to
the LIBO Rate plus the Applicable Margin.
"LIBOR Reserve Percentage" means, relative to any Interest Period for LIBOR
Loans made by any Lender, the reserve percentage (expressed as a decimal) equal
to the actual aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transactional adjustments or other scheduled changes in reserve requirements)
announced within Agent Bank as the reserve percentage applicable to Agent Bank
as specified under regulations issued from time to time by the Federal Reserve
Board. The LIBOR Reserve Percentage shall be based on Regulation D of the
Federal Reserve Board or other regulations from time to time in effect
concerning reserves for "Eurocurrency Liabilities" from related institutions as
though Agent Bank were in a net borrowing position.
"Laws" means, collectively, all international, foreign, federal, state and
local statutes, maritime laws, treaties, rules, regulations, ordinances, codes
and administrative or judicial precedents.
"Lender Reply Period" shall have the meaning set forth in Section 9.10(d).
"Lenders" shall have the meaning set forth in the Preamble to this Credit
Agreement. At all times that there are no Lenders other than WFB, the terms
"Lender" and "Lenders" means WFB in its individual capacity. With respect to
matters requiring the consent to or approval of all Lenders at any given time,
all then existing Defaulting Lenders will be disregarded and excluded, and, for
voting purposes only, "all Lenders" shall be deemed to mean "all Lenders other
than Defaulting Lenders".
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"Leverage Ratio" as of the end of any Fiscal Quarter shall mean the ratio
resulting by dividing (a) Funded Debt for the Fiscal Quarter under review by
(b) the sum of EBITDA for the Fiscal Quarter under review plus EBITDA for each
of the most recently ended three (3) preceding Fiscal Quarters.
"Liabilities" shall mean the total liabilities of the Borrower
Consolidation in accordance with GAAP.
"Liabilities and Costs" means all claims, judgments, liabilities,
obligations, responsibilities, losses, damages (including lost profits),
punitive or treble damages, costs, disbursements and expenses (including,
without limitation, reasonable attorneys', experts' and consulting fees and
costs of investigation and feasibility studies), fines, penalties and monetary
sanctions, interest, direct or indirect, known or unknown, absolute or
contingent, past, present or future.
"Lien" means any lien, mortgage, pledge, assignment, security interest,
charge or encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof, and any agreement to give
any security interest) and any option, trust or other preferential arrangement
having the practical effect of any of the foregoing.
"Loan Documents" shall mean collective reference to the Credit Agreement,
the Revolving Credit Note, the Security Documentation, the Environmental
Certificate and all other documents and instruments which may hereafter be
executed and delivered by or on behalf of Borrowers or any other Person in
connection with the Credit facility for the benefit of Banks or Agent Bank on
behalf of the Lenders, as the same may be amended, modified, supplemented,
replaced, renewed or restated from time to time.
"Logan Filly Parcel" shall mean the real property subject to the Logan
Filly Purchase Agreement which is particularly described on that certain exhibit
marked "Exhibit O" affixed hereto and by this reference incorporated herein and
made a part hereof.
"Logan Filly Parcel Closing" shall mean closing of the sale transaction for
MPI's acquisition of the Logan Filly Parcel.
"Logan Filly Parcel Permitted Exceptions" shall mean a collective reference
to Exceptions numbered 1 through 7, 9, 11 through 14, 18 and 20 through 24 which
are set forth by that certain Title Insurance Commitment which has been issued
by Chicago Title Insurance Company, with respect to the Logan Filly Parcel,
under Commitment No. A-4893 and dated as of April 13, 1999.
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"Logan Filly Purchase Agreement" shall mean that certain Purchase Agreement
Filly Parcel, under date of June 22, 1999, by and between MPI, as purchaser, and
the Logan Group, as seller, pursuant to which, among other things, the Logan
Group agreed to sell the Logan Filly Parcel to MPI in accordance with the terms
and conditions set forth therein.
"Logan Group" shall mean a collective reference to Robert Logan, an
individual, and Realm, Inc., a West Virginia corporation.
"Logan Loan Documents" shall mean a collective reference to: (i) the
promissory note which is to be executed by MPI and payable to the order of the
Logan Group, in a principal amount of Three Hundred Eighty-three Thousand
Dollars ($383,000.00), and in the form which is attached to the Logan Primary
Purchase Agreement as "Exhibit E", as part of the purchase price for the Logan
Primary Parcel; and (ii) a Deed of Trust (Commercial Loan), securing performance
under such promissory note, in the form which has been delivered to Agent Bank
under cover of a letter from Robert Gach, Esq. dated December 14, 1999 and
addressed to Henderson & Morgan, LLC; all of which are to be executed and
delivered as of the Logan Primary Parcel Closing in accordance with the terms
and conditions of the Logan Primary Purchase Agreement.
"Logan Primary Parcel" shall mean the real property subject to the Logan
Primary Purchase Agreement which is particularly described on that certain
exhibit marked "Exhibit N" affixed hereto and by this reference incorporated
herein and made a part hereof.
"Logan Primary Parcel Closing" shall mean closing of the sale transaction
for MPI's acquisition of the Logan Primary Parcel from the Logan Group.
"Logan Primary Parcel Permitted Exceptions" shall mean a collective
reference to: (i) the Logan Loan Documents; and (ii) exceptions 2, 5 through 9,
12, 13, 15 through 24, 26 through 29 and 31, all as set forth on that certain
Title Insurance Commitment which has been issued by Chicago Title Insurance
Company, with respect to the Logan Primary Parcel, under Commitment No. A-4700
and dated as of September 15, 1998.
"Logan Primary Purchase Agreement" shall mean that certain Purchase
Agreement, under date of June 22, 1999, by and between MPI, as purchaser, and
the Logan Group, as seller, pursuant to which, among other things, the Logan
Group agreed to sell the Logan Primary Parcel to MPI in accordance with the
terms and conditions set forth therein.
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"Logan Purchase Agreements" shall mean a collective reference to the Logan
Filly Purchase Agreement and the Logan Primary Purchase Agreement.
"MPI" shall have the meaning ascribed to such term in the Preamble of this
Credit Agreement.
"MPI Assignment of Entitlements, Contracts, Rents and Revenues" shall mean
that certain Assignment of Entitlements, Contracts, Rents and Revenues (MPI)
which was executed by MPI on December 20, 1999 and recorded in the Official
Records of Hancock County, West Virginia on December 27, 1999 in Trust Book No.
395 at Page 512 as Document No. 020484, pursuant to which MPI assigned to Agent
Bank on behalf of Lenders, on a present and continuing basis (reserving a
revocable license to retain and use during any period in which there is no
continuing Event of Default): (a) all of its right, title and interest under all
MPI Spaceleases and MPI Equipment Leases and Contracts relating to the MPI
Hotel/Casino Facilities, (b) all of its right, title and interest in and to all
permits, licenses and contracts relating to the MPI Hotel/Casino Facilities,
except Gaming Permits and those permits, licenses and contracts which are
unassignable, and (c) all rents, issues, profits, revenues and income from the
MPI Real Property and the operation of the MPI Hotel/Casino Facilities and any
other business activity conducted on the MPI Real Property, together with any
and all future expansions thereof, related thereto or used in connection
therewith, as such assignment may be amended, modified, extended, renewed or
restated from time to time.
"MPI Closing Instructions" shall mean the Closing Instructions to be given
by Agent Bank to the MPI Title Insurance Company on or before the Closing Date
setting forth the requirements of Lenders for the issuance of the MPI Title
Endorsements and other conditions for the funding of the Closing Disbursements
to the reasonable satisfaction of Agent Bank, Lenders and the Borrowers.
"MPI Collateral" shall mean collective reference to: (i) all of the MPI
Real Property, MPI FF&E and the contract rights, leases, intangibles and other
interests of MPI which are subject to the liens and security interests of the
MPI Security Documents; (ii) all rights of MPI presently assigned pursuant to
the terms of the MPI Security Documents; and (iii) any and all other property
and/or intangible rights, interest or benefits inuring to or in favor of
Borrowers, which are in any manner assigned, pledged, encumbered or otherwise
hypothecated in favor of Agent Bank on behalf of Lenders to secure payment of
the Credit Facility.
"MPI Deed of Trust" shall mean a collective reference to the Existing MPI
Deed of Trust as amended by the Second Amendment to MPI Deed of Trust and as it
may be further amended, modified, extended, renewed or restated from time to
time.
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<PAGE>
"MPI Equipment Leases and Contracts" shall mean the executed leases and
purchase contracts pertaining to the MPI FF&E wherein MPI is the lessee or
vendee, as the case may be, as set forth on that certain schedule marked
"Schedule 4.16(A)", affixed hereto and by this reference incorporated herein and
made a part hereof.
"MPI FF&E" shall mean the furniture, fixtures and equipment and all gaming
equipment and devices which have been installed or are to be installed and used,
owned or leased by MPI in connection with the operation of the MPI Hotel/Casino
Facilities.
"MPI Financing Statements" shall mean a collective reference to: (i) the
Uniform Commercial Code financing statement which was filed in the Office of the
Secretary of State of the State of West Virginia on December 23, 1999 under File
No. 531356; and (ii) the Uniform Commercial Code Financing Statement which was
filed in the Office of the County Recorder of Hancock County, West Virginia on
December 27, 1999 in Book 60 at Page 3204 which financing statements will
provide for perfection of the security interest granted to Agent Bank on behalf
of Lenders under the MPI Deed of Trust and other MPI Security Documents in
accordance with requirements of the West Virginia Uniform Commercial Code, as
such financing statements may be amended, modified, extended, renewed or
restated from time to time.
"MPI Hotel/Casino Facilities" shall mean the racetrack, hotel and casino
business and related activities conducted on the MPI Real Property under the
common law trade names of the "Mountaineer Racetrack & Gaming Resort",
"Mountaineer Lodge" and "Woodview Golf Course".
"MPI Permitted Encumbrances" shall mean, at any particular time, (i) liens
for taxes, assessments or governmental charges not then due and payable or not
then delinquent, (ii) statutory liens for labor and/or materials and liens for
taxes, assessments or governmental charges the validity of which, in either
instance, are being contested in good faith by Borrowers by appropriate
proceedings, and as provided in Sections 5.03 and 5.10 hereof, respectively,
provided that, Borrowers shall have maintained adequate reserves in accordance
with GAAP for payment of same, (iii) liens incurred or deposits made in the
ordinary course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds, bids,
leases, government contracts, trade contracts, performance and return-of-money
bonds and other similar obligations (exclusive of obligations for the payment of
borrowed money); (iv) leases or subleases granted to others (including, without
limitation, any Subsidiary) not interfering in any material respect with the
ordinary conduct of the business of the MPI Hotel/Casino Facilities, including,
without limitation, the MPI Trailer Park Leases, (v) liens created or
contemplated by the MPI Security Documents, (vi) the liens, encumbrances and
restrictions on the MPI Real
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Property, MPI FF&E and existing improvements which are shown as exceptions on
Schedule B of the MPI Title Insurance Policy, including, without limitation, the
Woodview Loan Documents, (vii) liens consented to in writing by Agent Bank upon
the approval of Requisite Lenders, (viii) liens of legally valid capital leases
and purchase money security interests for MPI FF&E to the extent permitted by
Section 6.09(c), (ix) each and every easement, restriction, license or
right-of-way that (A) is hereafter granted to any Governmental Authority or
public utility providing services to the MPI Real Property or (B) does not
interfere in any material respect with the MPI Hotel/Casino facilities;
(x) judgment liens, writs, warrants, levies, distraints, attachments and other
similar process which do not constitute an Event of Default; (xi) subsequent to
the Logan Primary Parcel Closing, the Logan Primary Parcel Permitted Exceptions;
and (xii) subsequent to the Logan Filly Parcel Closing, the Logan Filly Parcel
Permitted Exceptions.
"MPI Real Property" shall mean: (i) the real property owned by MPI which is
more particularly described on that certain exhibit marked "Exhibit K", affixed
hereto and by this reference incorporated herein and made a part hereof;
(ii) subsequent to occurrence of the Logan Primary Parcel Closing, the Logan
Primary Parcel; and (iii) subsequent to occurrence of the Logan Filly Parcel
Closing, the Logan Filly Parcel.
"MPI Security Documents" shall mean collective reference to the MPI Deed of
Trust, MPI Assignment of Entitlements, Contracts, Rents and Revenues, the MPI
Financing Statements and all other documents, instruments or agreements which
are executed or delivered by or on behalf of MPI and accepted by Agent Bank, on
behalf of Lenders, as security for payment of the Credit Facility.
"MPI Spaceleases" shall mean the executed leases and concession agreements
pertaining to the MPI Hotel/Casino Facilities, or any portion thereof, wherein
MPI is the lessor, as set forth on that certain schedule marked "Schedule
4.15(A)", affixed hereto and by this reference incorporated herein and made a
part hereof.
"MPI Title Endorsements" shall mean a collective reference to the following
endorsements, which shall be issued to the Existing MPI Title Insurance Policy
by the MPI Title Insurance Company, as of the Closing Date, in accordance with
the MPI Closing Instructions: (i) General Endorsement (PA 1070); (ii) Mortgage
Modification Endorsement (PA 500); (iii) Tie-In Endorsement; and (iv) such other
endorsements as may be requested by Agent Bank; all of which shall be in a form
and substance acceptable to Agent Bank.
"MPI Title Insurance Company" shall mean Commonwealth Land Title Insurance
Company, with offices located at 300 Bilmar Drive, Suite 150 in Pittsburgh,
Pennsylvania, together with such reinsurers with direct access as are requested
by Agent
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Bank or other title insurance company or companies as may be reasonably
acceptable to Agent Bank.
"MPI Title Insurance Policy" shall mean a collective reference to the
Existing MPI Title Insurance Policy and the MPI Title Endorsements.
"MPI Trailer Park Leases" shall mean collective reference to the leases of
trailer spaces at Mountaineer Mobile City which are more particularly described
on Schedule 4.15(A).
"MTRI" shall have the meaning ascribed to such term in the Preamble of this
Credit Agreement.
"MTRI Financing Statements" shall mean a collective reference to the
Uniform Commercial Code financing statements which were filed: (i) in the Office
of the Secretary of State of the State of West Virginia, on December 23, 1999
under File No. 531359 in accordance with the Uniform Commercial Code as enacted
in the State of West Virginia; and (ii) in the Office of the Secretary of State
of the State of Delaware, on December 23, 1999 under File No. 9968346 in
accordance with the Uniform Commercial Code as enacted in the State of Delaware,
which financing statements will provide for perfection of the security interest
granted to Agent Bank on behalf of Lenders under the MTRI Security Agreement as
such financing statements may be amended, modified, extended, renewed or
restated from time to time.
"MTRI Permitted Encumbrances" shall mean, at any particular time, (i) liens
for taxes, assessments or governmental charges not then due and payable or not
then delinquent, (ii) statutory liens for labor and/or materials and liens for
taxes, assessments or governmental charges the validity of which, in either
instance, are being contested in good faith by Borrowers by appropriate
proceedings, and as provided in Sections 5.03 and 5.10 hereof, respectively,
provided that, Borrowers shall have maintained adequate reserves in accordance
with GAAP for payment of same, (iii) liens incurred or deposits made in the
ordinary course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds, bids,
leases, government contracts, trade contracts, performance and return-of-money
bonds and other similar obligations (exclusive of obligations for the payment of
borrowed money); (iv) liens created or contemplated by the MTRI Security
Agreement and MTRI Financing Statements; (v) liens consented to in writing by
Agent Bank upon the approval of Requisite Lenders, (vi) liens of legally valid
capital leases and purchase money security interests for SGRI FF&E to the extent
permitted by Section 6.09(c); and (vii) judgment liens, writs, warrants, levies,
distraints, attachments and other similar process which do not constitute an
Event of Default.
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"MTRI Security Agreement" shall mean a collective reference to the Existing
MTRI Security Agreement as amended by the Second Amendment to MTRI Security
Agreement, and as it may be further amended, modified, extended, renewed or
restated from time to time.
"Maintenance Capital Expenditures" shall mean collective reference to
Capital Expenditures made to or for the benefit of or for use in connection with
the Hotel/Casino Facilities which are for the purpose of maintaining, repairing
and/or replacing existing assets of the Borrower Consolidation.
"Margin Stock" shall have the meaning provided in Regulation U of the Board
of Governors of the Federal Reserve System.
"Material Adverse Change" shall mean: (i) any set of circumstances of
events which, other than with respect to the Representations and Warranties set
forth in Article IV of the Credit Agreement which shall be construed to be
applicable to circumstances and events existing both as of the Closing Date (or
such earlier date as may be referenced in each particular provision) and
subsequent to the Closing Date, are not in existence as of the Closing Date,
which are material and adverse to (a) the Collateral or (b) the condition
(financial or otherwise) or business operations of the Borrower Consolidation
taken as a whole, or (c) the ability of any of the Lenders to enforce any of
their material rights or remedies under any of the Loan Documents, or (ii) any
events or changes, which, other than with respect to the Representations and
Warranties set forth in Article IV of the Credit Agreement which shall be
construed to be applicable to events and changes existing both as of the Closing
Date (or such earlier date as may be referenced in each particular provision)
and subsequent to the Closing Date, are not in existence as of the Closing Date
and which have or result in a material adverse effect upon (a) the value of the
Hotel/Casino Facilities taken as a whole or the priority of the security
interests granted to Agent Bank, (b) the validity of any of the Loan Documents,
or (c) the use, occupancy or operation of the Hotel/Casino Facilities taken as a
whole.
"Maturity Date" shall mean August 15, 2005.
"Maximum Availability" shall mean the Maximum Permitted Balance less the
Aggregate Outstandings.
"Maximum Maintenance Cap Ex Limit" shall have the meaning ascribed to such
term in Section 6.06(a) of the Credit Agreement.
"Maximum Permitted Balance" shall mean the Aggregate Commitment as may be
voluntarily reduced by Borrowers pursuant to Section 2.01(c) or is otherwise
reduced or limited pursuant to Sections 5.01, 5.12, 5.23, 6.12(b) or 8.02.
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"Minimum Maintenance Cap Ex Requirement" shall have the meaning ascribed to
such term in Section 6.06(a) of the Credit Agreement.
"Net Income" shall mean with respect to any Person for any fiscal period,
the net income of such Person (determined without regard to any Insider Non-Cash
Loans) during such fiscal period determined in accordance with GAAP.
"Net Proceeds" shall mean the aggregate cash proceeds received by the
Borrower Consolidation in respect of (a) Capital Proceeds net of the direct
costs relating to such sale, transfer, conveyance or disposition of FF&E,
amounts required to be applied to the repayment of Indebtedness secured by a
Lien on the asset or assets that were the subject of such sale, transfer,
conveyance or disposition of FF&E and all Indebtedness assumed by the purchaser
in connection with such sale, transfer, conveyance or disposition of FF&E and
all taxes paid or payable as a result of such sale, transfer, conveyance or
disposition, and (b) any Equity Offering issued by MTRI, in each case less all
costs, fees and expenses (including without limitation underwriting, placement,
financial advisory and similar fees and expenses) incurred in connection with
the issuance of such Equity Offering, but shall not include the proceeds of
Insider Cash Loan and Insider Non-Cash Loans.
"Nevada Gaming Authorities" shall mean, without limitation, the Nevada
Gaming Commission and the State Gaming Control Board and any other applicable
governmental or administrative state or local agency involved in the regulation
of gaming and gaming activities conducted by the Borrower Consolidation in the
State of Nevada.
"New Venture" means a casino, hotel, casino/hotel, resort, casino/resort,
riverboat casino, dock casino, dog or horse racing business, entertainment
center or similar facility (or any site or proposed site for any of the
foregoing or entity that provides management or other services or goods to any
of the foregoing) owned in whole by any member of the Borrower Consolidation
(including each Subsidiary created in accordance with Section 6.16) or which is
owned by a Person in which any member of the Borrower Consolidation is an owner
or equity investor, but shall not include the Hotel/Casino Facilities or
Expansion Capital Expenditures to the extent permitted under Section 6.06(b).
"New Venture Investment" shall mean any Investment made by the Borrower
Consolidation in or to any New Venture.
"New Venture Investments" shall mean collective reference to each and every
New Venture Investment.
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"Non-Financed Capital Expenditures" shall mean Capital Expenditures
(exclusive of the Expansion Capital Expenditures permitted under Section 6.06(b)
and Indebtedness incurred under Section 6.04(d)) which are paid by Borrowers
from assets of the Borrower Consolidation and not from the Credit Facility or
through any other loan, credit agreement, lease or financing from any source.
"Non Pro Rata Borrowing" means a Borrowing with respect to which fewer than
all Lenders have funded their respective Pro Rata Shares of such Borrowing and
the failure of the non-funding Lender or Lenders to fund its or their respective
Pro Rata Shares of such Borrowing constitutes a breach of this Credit Agreement.
"Notes" shall mean collective reference to the Revolving Credit Note and
the Swingline Note.
"Notice of Borrowing" shall have the meaning set forth in Section 2.03.
"Notice of Swingline Advance" shall have the meaning set forth in
Section 2.08(b).
"Obligations" means, from time to time, all Indebtedness of Borrowers owing
to Agent Bank, any Lender or any Person entitled to indemnification pursuant to
Section 5.14, or any of their respective successors, transferees or assigns, of
every type and description, whether or not evidenced by any note, guaranty or
other instrument, arising under or in connection with this Credit Agreement, any
other Loan Document or any Interest Rate Hedge, whether or not for the payment
of money, whether direct or indirect (including those acquired by assignment),
absolute or contingent, due or to become due, now existing or hereafter arising
and however acquired. The term includes, without limitation, all interest,
charges, expenses, fees, reasonable attorneys' fees and disbursements,
reasonable fees and disbursements of expert witnesses and other consultants, and
any other sum now or hereinafter chargeable to Borrowers under or in connection
with Credit Agreement or any other Loan Document. Notwithstanding the foregoing
definition of "Obligations", Borrowers' obligations under any environmental
indemnity agreement constituting a Loan Document, or any environmental
representation, warranty, covenant, indemnity or similar provision in this
Credit Agreement or any other Loan Document, shall be secured by the Collateral
only to the extent, if any, specifically provided in the Security Documentation.
"Pension Plan" means any "employee pension benefit plan" (other than a
"multi-employer plan" as defined in Title IV of ERISA which is maintained by any
Person which is not a member of the Borrower Consolidation) that is subject to
Title IV of ERISA and which is maintained for employees of Borrowers or any of
its ERISA Affiliates.
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"Permitted Encumbrances" shall mean collective reference to the MPI
Permitted Encumbrances, SGLVI Permitted Encumbrances, the SGRI Permitted
Encumbrances and the MTRI Permitted Encumbrances.
"Person" means an individual, firm, corporation, limited liability company,
trust, association, partnership, joint venture, tribunal or other entity.
"Policies of Insurance" shall mean the insurance to be obtained and
maintained by Borrowers throughout the term of this Credit Agreement as provided
by Section 5.09 herein.
"Post Foreclosure Plan" shall have the meaning set forth in
Section 9.11(e).
"Pricing Certificate" shall have the meaning set forth in Section 5.08(b).
"Prime Rate" means at any time, and from time to time, the rate of interest
most recently announced within WFB at its principal office in San Francisco,
California, as its "Prime Rate", with the understanding that WFB's "Prime Rate"
is one of its base rates and serves as the basis upon which effective rates of
interest are calculated for those loans and extensions of credit making
reference thereto, and is evidenced by the recording thereof after its
announcement in such internal publication or publications as WFB may designate.
Each change in the Prime Rate shall be effective on the day the change is
announced within WFB.
"Principal Prepayments" shall have the meaning set forth in Section 2.07(a)
of this Credit Agreement.
"Pro Rata Share" shall mean, with respect to any Lender, a percentage equal
to such Lender's Syndication Interest in the Credit Facility as set forth on the
Schedule of Lenders' Proportions in Credit Facility.
"Protective Advance" means all sums expended as determined by Agent Bank to
be necessary to: (a) protect the priority, validity and enforceability of the
Security Documentation on, and security interests in, any Collateral and the
instruments evidencing or securing the Obligations, or (b) prevent the value of
any Collateral from being materially diminished (assuming the lack of such a
payment within the necessary time frame could potentially cause such Collateral
to lose value), or (c) protect any of the Collateral from being materially
damaged, impaired, mismanaged or taken, including, without limitation, any
amounts expended in accordance with Section 10.20 or post-foreclosure ownership,
maintenance, operation or marketing of any Collateral.
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"Qualified Appraisal" shall mean reference to an appraisal or appraisals of
the Hotel/Casino Facilities and Collateral, or any portion thereof, acceptable
to Agent Bank, prepared at Borrowers' expense in compliance with FIRREA by an
appraiser acceptable to Agent Bank, with sufficient copies delivered to Agent
Bank for distribution to each of the Lenders.
"Rate Adjustment Date" shall mean December 1, 2000.
"Related Entities" shall mean collective reference to all stockholders,
employees, Affiliates and Subsidiaries of the Borrowers, or any of them, other
than another Borrower.
"Replacement Note(s)" shall have the meaning set forth in Section 2.06(i)
of the Credit Agreement.
"Reportable Event" shall mean any of the events described in
Section 4043(b) of ERISA, other than an event for which the thirty (30) day
notice requirement is waived by regulations.
"Requisite Lenders" means, as of any date of determination prior to the
occurrence of an Event of Default, Lenders holding Syndication Interests equal
to or in excess of seventy-five percent (75.0%) of the Credit Facility; and at
all times during which an Event of Default has occurred and remains continuing,
Lenders holding a percentage equal to or in excess of seventy-five percent (75%)
of the Funded Outstandings; PROVIDED THAT, (i) in determining such percentage at
any given time, all then existing Defaulting Lenders will be disregarded and
excluded and the Pro Rata Shares of Lenders shall be redetermined, for voting
purposes only, to exclude the Pro Rata Shares of such Defaulting Lenders, and
(ii) notwithstanding the foregoing, at all times when two or more Lenders are
party to this Credit Agreement, the term Requisite Lenders shall in no event
mean less than two (2) Lenders.
"Revolving Credit Note" shall mean the Amended and Restated Revolving
Credit Promissory Note, a copy of which is marked "Exhibit A", affixed hereto
and by this reference incorporated herein and made a part hereof, to be executed
by Borrowers on the Closing Date, payable to the order of Agent Bank on behalf
of the Lenders, evidencing the Credit Facility, as may be amended, modified,
extended, renewed or restated from time to time.
"Revolving Credit Period" shall mean the period commencing on the Closing
Date and terminating on the Maturity Date.
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"SABAL Loan" shall mean the obligation of MTRI to lend to SABAL Corp. up to
Five Hundred Thousand Dollars ($500,000.00) (of which Three Hundred Eighty-Three
Thousand Three Hundred Twenty-Six Dollars and Fourteen Cents ($383,326.14) had
been lent as of November 30, 1999) pursuant to a December 30, 1998 non-revolving
Term Loan Agreement entered by SABAL Corp. and ExCal Energy Corporation, a
wholly owned subsidiary of MTRI, in connection with MTRI's divestiture of its
oil and gas assets.
"SGLVI" shall have the meaning ascribed to such term in the
Preamble of this Credit Agreement.
"SGLVI Assignment of Entitlements, Contracts, Rents and Revenues" shall
mean that certain Assignment of Entitlements, Contracts, Rents and Revenues
(SGLVI) which was executed by SGLVI on December 20, 1999 and recorded in the
Official Records of Clark County, Nevada on December 23, 1999 in Book 991223 as
Instrument No. 02089, pursuant to which SGLVI assigned to Agent Bank on behalf
of Lenders, on a present and continuing basis (reserving a revocable license to
retain and use during any period in which there is no continuing Event of
Default): (a) all of its right, title and interest under all SGLVI Spaceleases
and SGLVI Equipment Leases and Contracts relating to the SGLVI Hotel/Casino
Facility, (b) all of its right, title and interest in and to all permits,
licenses and contracts relating to the SGLVI Hotel/Casino Facilities, except
Gaming Permits and those permits, licenses and contracts which are unassignable,
and (c) all rents, issues, profits, revenues and income from the SGLVI Real
Property and the SGLVI Hotel/Casino Facility and any other business activity
conducted on the SGLVI Real Property, together with any and all future
expansions thereof, related thereto or used in connection therewith, as such
assignment may be amended, modified, extended, renewed or restated from time to
time.
"SGLVI Closing Instructions" shall mean the Closing Instructions to be
given by Agent Bank to the SGLVI Title Insurance Company on or before the
Closing Date setting forth the requirements of Lenders for the issuance of the
SGLVI Title Endorsements and other conditions for the funding of the Closing
Disbursements to the reasonable satisfaction of Agent Bank, Lenders and the
Borrowers.
"SGLVI Collateral" shall mean collective reference to: (i) all of the SGLVI
Real Property, SGLVI FF&E, and the contract rights, leases, intangibles and
other interests of SGLVI, which are subject to the liens and security interests
of the SGLVI Security Documents; (ii) all rights of SGLVI presently assigned
pursuant to the terms of the SGLVI Security Documents; and (iii) any and all
other property and/or intangible rights, interest or benefits inuring to or in
favor of SGLVI, which are in any manner assigned, pledged, encumbered or
otherwise hypothecated in favor of Agent Bank on behalf of Lenders to secure
payment of the Credit Facility.
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"SGLVI Deed of Trust" shall mean the Existing SGLVI Deed of Trust as
amended by the Second Amendment to SGLVI Deed of Trust and as it may be further
amended, modified, extended, renewed or restated from time to time.
"SGLVI Equipment Leases and Contracts" shall mean the executed leases and
purchase contracts pertaining to the SGLVI FF&E wherein SGLVI is the lessee or
vendee, as the case may be, as set forth on that certain schedule marked
"Schedule 4.16(B)", affixed hereto and by this reference incorporated herein and
made a part hereof.
"SGLVI FF&E" shall mean the furniture, fixtures and equipment and all
gaming equipment and devices which have been installed or are to be installed
and used, owned or leased by SGLVI in connection with the operation of the SGLVI
Hotel/Casino Facility.
"SGLVI Financing Statements" shall mean a collective reference to the
Uniform Commercial Code financing statements which were filed: (i) in the Office
of the Secretary of State of the State of Nevada, on December 27, 1999 under
File No. 9919684 in accordance with the requirements of the Uniform Commercial
Code as enacted in the State of Nevada; (ii) in the Official Records of Clark
County, Nevada on December 23, 1999 in Book 991223 as Instrument No. 02089 in
accordance with the requirements of the Uniform Commercial Code as enacted in
the State of Nevada; and (iii) in the office of the West Virginia Secretary of
State on December 23, 1999 under File No. 531358 in accordance with the
requirements of the Uniform Commercial Code as enacted in the State of West
Virginia; which financing statements will provide for perfection of the security
interest granted to Agent Bank on behalf of Lenders under the SGLVI Deed of
Trust and other SGLVI Security Documents, as such financing statements may be
amended, modified, extended, renewed or restated from time to time.
"SGLVI Hotel/Casino Facility" shall mean the improvements and the hotel and
casino business and related activities conducted on the SGLVI Real Property
under the trade name of Ramada Inn and Speedway Casino.
"SGLVI Permitted Encumbrances" shall mean, at any particular time,
(i) liens for taxes, assessments or governmental charges not then due and
payable or not then delinquent, (ii) statutory liens for labor and/or materials
and liens for taxes, assessments or governmental charges the validity of which,
in either instance, are being contested in good faith by Borrowers by
appropriate proceedings, and as provided in Sections 5.03 and 5.10 hereof,
respectively, provided that, Borrowers shall have maintained adequate reserves
in accordance with GAAP for payment of same, (iii) liens incurred or deposits
made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security,
or to secure the performance of tenders,
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statutory obligations, surety and appeal bonds, bids, leases, government
contracts, trade contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of borrowed
money); (iv) leases or subleases granted to others (including, without
limitation, any Subsidiary) not interfering in any material respect with the
ordinary conduct of the business of the SGLVI Hotel/Casino Facility; (v) liens
created or contemplated by the SGLVI Security Documents, (vi) the liens,
encumbrances and restrictions on the SGLVI Real Property, SGLVI FF&E and
existing improvements which are shown as exceptions on Schedule B of the SGLVI
Title Insurance Policy, (vii) liens consented to in writing by Agent Bank upon
the approval of Requisite Lenders, (viii) liens of legally valid capital leases
and purchase money security interests for SGLVI FF&E to the extent permitted by
Section 6.09(c), and (ix) each and every easement, license, restriction or
right-of-way that (A) is hereafter granted to any Governmental Authority or
public utility providing services to the SGLVI Real Property or (B) does not
interfere in any material respect with the SGLVI Hotel/Casino Facility; and
(x) judgment liens, writs, warrants, levies, distraints, attachments and other
similar process which do not constitute an Event of Default.
"SGLVI Real Property" shall mean the real property owned by SGLVI which is
more particularly described on that certain exhibit marked "Exhibit L", affixed
hereto and by this reference incorporated herein and made a part hereof.
"SGLVI Security Documents" shall mean collective reference to the SGLVI
Deed of Trust, SGLVI Assignment of Entitlements, Contracts, Rents and Revenues,
the SGLVI Financing Statements and all other documents, instruments or
agreements which are executed or delivered by or on behalf of SGLVI, and
accepted by Agent Bank, on behalf of the Lenders, as security for payment of the
Credit Facility.
"SGLVI Spaceleases" shall mean the executed leases and concession
agreements pertaining to the SGLVI Hotel/Casino Facility, or any portion
thereof, wherein SGLVI is the lessor, as set forth on that certain schedule
marked "Schedule 4.15(B)", affixed hereto and by this reference incorporated
herein and made a part hereof.
"SGLVI Title Endorsements" shall mean a collective reference to the
following endorsements, which shall be issued to the Existing SGLVI Title
Insurance Policy by the MPI Title Insurance Company, as of the Closing Date, in
accordance with the SGLVI Closing Instructions: (i) Modification and Additional
Advance Endorsement (Special 254); (ii) Tie-In Endorsement; and (iii) such other
endorsements as may be requested by Agent Bank; all of which shall be in a form
and substance acceptable to Agent Bank.
"SGLVI Title Insurance Company" shall mean Nevada Title Company, with
offices located at 3800 Howard Hughes Parkway, Suite 920, Las Vegas, Nevada, as
the
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issuing agent for Commonwealth Land Title Insurance Company, together with such
reinsurers with direct access as are requested by Agent Bank or other title
insurance company or companies as may be reasonably acceptable to Agent Bank.
"SGLVI Title Insurance Policy" shall mean a collective reference to the
Existing SGLVI Title Insurance Policy and the SGLVI Title Endorsements.
"SGRI" shall have the meaning ascribed to such term in the Preamble of this
Credit Agreement.
"SGRI Assignment of Entitlements, Contracts, Rents and Revenues" shall mean
that certain Assignment of Entitlements, Contracts, Rents and Revenues (SGRI)
which was executed by SGRI on December 20, 1999 and recorded in the Official
Records of Washoe County, Nevada on December 23, 1999 as Document No. 2408914,
pursuant to which SGRI assigned to Agent Bank on behalf of Lenders, on a present
and continuing basis (reserving a revocable license to retain and use during any
period in which there is no continuing Event of Default): (a) all of its right,
title and interest under all SGRI Spaceleases and SGRI Equipment Leases and
Contracts relating to the SGRI Hotel/Casino Facilities, (b) all of its right,
title and interest in and to all permits, licenses and contracts relating to the
SGRI Hotel/Casino Facilities, except Gaming Permits and those permits, licenses
and contracts which are unassignable, and (c) all rents, issues, profits,
revenues and income from the SGRI Real Property and the operation of the SGRI
Hotel/Casino Facilities and any other business activity conducted on the SGRI
Real Property, together with any and all future expansions thereof, related
thereto or used in connection therewith, as such assignment may be amended,
modified, extended, renewed or restated from time to time.
"SGRI Closing Instructions" shall mean the Closing Instructions to be given
by Agent Bank to the SGRI Title Insurance Company on or before the Closing Date
setting forth the requirements of Lenders for the issuance of the SGRI Title
Endorsements and other conditions for the funding of the Closing Disbursements
to the reasonable satisfaction of Agent Bank, Lenders and the Borrowers.
"SGRI Collateral" shall mean collective reference to: (i) all of the SGRI
Real Property, SGRI FF&E and the contract rights, leases, intangibles and other
interests of SGRI which are subject to the liens and security interests of the
SGRI Security Documents; (ii) all rights of SGRI presently assigned pursuant to
the terms of the SGRI Security Documents; and (iii) any and all other property
and/or intangible rights, interest or benefits inuring to or in favor of
Borrowers, which are in any manner assigned, pledged, encumbered or otherwise
hypothecated in favor of Agent Bank on behalf of Lenders to secure payment of
the Credit Facility.
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"SGRI Deed of Trust" Existing SGRI Deed of Trust as amended by the Second
Amendment to SGRI Deed of Trust and as it may be further amended, modified,
extended, renewed or restated from time to time.
"SGRI Equipment Leases and Contracts" shall mean the executed leases and
purchase contracts pertaining to the SGRI FF&E wherein SGRI is the lessee or
vendee, as the case may be, as set forth on that certain schedule marked
"Schedule 4.16(C)", affixed hereto and by this reference incorporated herein and
made a part hereof.
"SGRI FF&E" shall mean the furniture, fixtures and equipment and all gaming
equipment and devices which have been installed or are to be installed and used,
owned or leased by SGRI in connection with the operation of the SGRI
Hotel/Casino Facilities.
"SGRI Financing Statements" shall mean a collective reference to the
Uniform Commercial Code financing statements which were filed: (i) in the Office
of the Secretary of State of the State of Nevada, on December 27, 1999 under
File No. 9919685 in accordance with the requirements of the Uniform Commercial
Code as enacted in the State of Nevada; (ii) in the Official Records of Washoe
County, Nevada on December 23, 1999 as Document No. 2408915 in accordance with
the requirements of the Uniform Commercial Code as enacted in the State of
Nevada; and (iii) in the office of the West Virginia Secretary of State on
December 23, 1999 under File No. 531357 in accordance with the requirements of
the Uniform Commercial Code as enacted in the State of West Virginia; which
financing statements will provide for perfection of the security interest
granted to Agent Bank on behalf of Lenders under the SGRI Deed of Trust and
other SGRI Security Documents, as such financing statements may be amended,
modified, extended, renewed or restated from time to time.
"SGRI Hotel/Casino Facilities" shall mean the hotel and casino business and
related activities conducted on the SGRI Real Property under the trade names of
the Ramada Inn and Speakeasy Casino.
"SGRI Permitted Encumbrances" shall mean, at any particular time, (i) liens
for taxes, assessments or governmental charges not then due and payable or not
then delinquent, (ii) statutory liens for labor and/or materials and liens for
taxes, assessments or governmental charges the validity of which, in either
instance, are being contested in good faith by Borrowers by appropriate
proceedings, and as provided in Sections 5.03 and 5.10 hereof, respectively,
provided that, Borrowers shall have maintained adequate reserves in accordance
with GAAP for payment of same, (iii) liens incurred or deposits made in the
ordinary course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to secure the
performance of tenders,
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statutory obligations, surety and appeal bonds, bids, leases, government
contracts, trade contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of borrowed
money); (iv) leases or subleases granted to others (including, without
limitation, any Subsidiary) not interfering in any material respect with the
ordinary conduct of the business of the SGRI Hotel/Casino Facility, (v) liens
created or contemplated by the SGRI Security Documents, (vi) the liens,
encumbrances and restrictions on the SGRI Real Property, SGRI FF&E and
existing improvements which are shown as exceptions on Schedule B of the SGRI
Title Insurance Policy to be issued by SGRI Title Insurance Company as of the
Closing Date, (vii) liens consented to in writing by Agent Bank upon the
approval of Requisite Lenders, (viii) liens of legally valid capital leases
and purchase money security interests for SGRI FF&E to the extent permitted
by Section 6.09(c), (ix) each and every easement, restriction, license or
right-of-way that (A) is hereafter granted to any Governmental Authority or
public utility providing services to the SGRI Real Property or (B) does not
interfere in any material respect with the SGRI Hotel/Casino facilities; and
(x) judgment liens, writs, warrants, levies, distraints, attachments and
other similar process which do not constitute an Event of Default.
"SGRI Real Property" shall mean the real property owned by SGRI which is
more particularly described on that certain exhibit marked "Exhibit P", affixed
hereto and by this reference incorporated herein and made a part hereof.
"SGRI Security Documents" shall mean collective reference to the SGRI Deed
of Trust, SGRI Assignment of Entitlements, Contracts, Rents and Revenues, the
SGRI Financing Statements and all other documents, instruments or agreements
which are executed or delivered by or on behalf of SGRI and accepted by Agent
Bank, on behalf of Lenders, as security for payment of the Credit Facility.
"SGRI Spaceleases" shall mean the executed leases and concession
agreements pertaining to the SGRI Hotel/Casino Facility, or any portion
thereof, wherein SGRI is the lessor, as set forth on that certain schedule
marked "Schedule 4.15(C)", affixed hereto and by this reference incorporated
herein and made a part hereof.
"SGRI Title Endorsements" shall mean a collective reference to the
following endorsements, which shall be issued to the Existing SGRI Title
Insurance Policy by the SGRI Title Insurance Company, as of the Closing Date, in
accordance with the SGRI Closing Instructions: (i) CLTA Form 110.10; (ii) Tie-In
Endorsement; and (iii) such other endorsements as may be requested by Agent
Bank; all of which shall be in a form and substance acceptable to Agent Bank.
"SGRI Title Insurance Company" shall mean Western Title Company, Inc., with
offices located at 241 Ridge Street, Reno, Nevada, as the issuing agent for
Lawyers Title Insurance Corporation, together with such reinsurers with direct
access as
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are requested by Agent Bank or other title insurance company, or companies as
may be reasonably acceptable to Agent Bank.
"SGRI Title Insurance Policy" shall mean a collective reference to the
Existing SGRI Title Insurance Policy and the SGRI Title Endorsements.
"Schedule of Existing Subsidiaries" shall mean the Schedule of Existing
Subsidiaries, a copy of which is set forth as Schedule 4.24, affixed hereto and
by this reference incorporated herein and made a part hereof, setting forth the
information described in Section 4.24 with respect to each Subsidiary which
exists as of the Closing Date.
"Schedule of Lenders' Proportions in Credit Facility" shall mean the
Schedule of Lenders' Proportions in Credit Facility, a copy of which is marked
"Schedule 2.01(a)", affixed hereto and by this reference incorporated herein and
made a part hereof, setting forth the respective Syndication Interest and
maximum amount to be funded under the Credit Facility by each Lender, as the
same may be amended, modified or restated from time to time in connection with
an Assignment and Assumption Agreement.
"Schedule of Significant Litigation" shall mean the Schedule of Significant
Litigation, a copy of which is set forth as Schedule 3.18, affixed hereto and by
this reference incorporated herein and made a part hereof, setting forth the
information described in Section 3.18 with respect to each Significant
Litigation.
"Second Amendment to MPI Deed of Trust" shall mean that certain Second
Amendment to A Credit Line Deed of Trust, Fixture Filing and Security Agreement
with Assignment of Rents and Notice of Additional Commitment (MPI) which is to
be executed by MPI and by Agent Bank, on or before the Closing Date, and is to
be recorded in the Official Records of Hancock County, West Virginia
concurrently, or substantially concurrent, with the Closing Date for the purpose
of amending the Existing MPI Deed of Trust in order to provide, among other
things, for the Existing MPI Deed of Trust to reflect Borrowers' entry into the
Credit Agreement and to secure performance under the Credit Facility.
"Second Amendment to MTRI Security Agreement" shall mean that certain
Second Amendment to Security Agreement (MTRI) which is to be executed by MTRI
and by Agent Bank, on or before the Closing Date, for the purpose of amending
the Existing MTRI Security Agreement in order to provide, among other things,
for the Existing MTRI Security Agreement to reflect Borrowers' entry into the
Credit Agreement and to secure performance under the Credit Facility.
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"Second Amendment to SGLVI Deed of Trust" shall mean that certain Second
Amendment to Deed of Trust, Fixture Filing and Security Agreement with
Assignment of Rents and Notice of Additional Commitment (SGLVI) which is to be
executed by SGLVI and by Agent Bank, on or before the Closing Date, and is to be
recorded in the Official Records of Clark County, Nevada, concurrently, or
substantially concurrent, with the Closing Date for the purpose of amending the
Existing SGLVI Deed of Trust in order to provide, among other things, for the
Existing SGLVI Deed of Trust to reflect Borrowers' entry into the Credit
Agreement and to secure performance under the Credit Facility.
"Second Amendment to SGRI Deed of Trust" shall mean that certain Second
Amendment to Deed of Trust, Fixture Filing and Security Agreement with
Assignment of Rents and Notice of Additional Commitment (SGRI) which is to be
executed by SGRI and by Agent Bank, on or before the Closing Date, and is to be
recorded in the Official Records of Washoe County, Nevada concurrently, or
substantially concurrent, with the Closing Date for the purpose of amending the
Existing SGRI Deed of Trust in order to provide, among other things, for the
Existing SGRI Deed of Trust to reflect Borrowers' entry into the Credit
Agreement and to secure performance under the Credit Facility.
"Secured Interest Rate Hedge(s)" shall mean any Interest Rate Hedge entered
into between any Borrower and any Lender, or Affiliate of any Lender, which is
secured by the Security Documentation.
"Security Document Amendments" shall mean a collective reference to the
Second Amendment to MPI Deed of Trust, Second Amendment to SGLVI Deed of Trust,
Second Amendment to SGRI Deed of Trust and the Second Amendment to MTRI Security
Agreement.
"Security Documentation" shall mean a collective reference to the MPI
Security Documents, SGLVI Security Documents, SGRI Security Documents, the Stock
Pledges, the Trademark Security Agreement and all other instruments and
agreements to be executed by or on behalf of Borrowers or other applicable
Persons, in favor of Agent Bank on behalf of the Lenders securing repayment of
the Credit Facility.
"Share Repurchases" shall mean the purchase of shares of any class of
stock, option, right or other equity interest, whether voting or non-voting of
MTRI by any member of the Borrower Consolidation, or any of them.
"Significant Litigation" shall mean each action, suit, proceeding,
litigation and controversy involving Borrowers, or any of them, involving claims
in excess of One Million
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Dollars ($1,000,000.00) or which if determined adverse to the interests of
Borrowers, or any of them, could result in a Material Adverse Change.
"Spaceleases" shall mean collective reference to the MPI Spaceleases,
SGLVI Spaceleases and SGRI Spaceleases.
"Stock Pledges" shall mean collective reference to: (i) the Security
Agreement and Pledge of Stock (Nevada) dated as of February 10, 2000, executed
between MTRI, as debtor, and Agent Bank, as secured party, together with
Speakeasy Gaming of Las Vegas, Inc. Certificate No. 2 dated January 24, 2000,
for 100 shares, issued in favor of MTRI and the Irrevocable Stock Power executed
in connection therewith, and further together with Speakeasy Gaming of Reno,
Inc. Certificate No. 2 dated January 24, 2000, for 100 shares, issued in favor
of MTRI and the Irrevocable Stock Power executed in connection therewith, and
(ii) the Security Agreement and Pledge of Stock dated as of December 20, 1999,
executed between MTRI, as debtor, and Agent Bank, as secured party, together
with Mountaineer Park, Inc. Certificate No. 16 dated October 16, 1992 for 110
shares, issued in favor of MTRI (formerly Excalibur Holding Corporation) and the
Irrevocable Stock Power executed in connection therewith; in each of (i) and
(ii) executed and delivered to Agent Bank on behalf of the Lenders as security
for the Credit Facility and all other sums which may be owing by Borrowers to
the Banks from time to time under the Credit Agreement, as the same may be
amended, modified or restated from time to time (including, without limitation,
the amendment and restatement of the Existing Credit Facility, Existing
Revolving Credit Note and Existing Credit Agreement evidenced by this Credit
Agreement and the Revolving Credit Note executed concurrently herewith), as the
same may be amended, modified or restated from time to time.
"Subsidiary" shall mean, on the date in question, any Person of which an
aggregate of 50% or more of the stock of any class or classes (or equivalent
interests) is owned of record or beneficially, directly or indirectly, by
another Person and/or any of its Subsidiaries, if the holders of the stock of
such class or classes (or equivalent interests) (a) are ordinarily, in the
absence of contingencies, entitled to vote for the election of a majority of the
directors (or individuals performing similar functions) of such Person, even
though the right so to vote has been suspended by the happening of such a
contingency, or (b) are entitled, as such holders, to vote for the election of a
majority of the directors (or individuals performing similar functions) of such
Person, whether or not the right so to vote exists by reason of the happening of
a contingency.
"Subsidiary Guaranty" shall mean the General Continuing Subsidiary Guaranty
to be executed by each Subsidiary in favor of the Agent Bank on behalf of Banks
in the form of the General Continuing Subsidiary Guaranty marked "Exhibit J",
affixed hereto and by this reference incorporated herein and made a part hereof,
under the terms
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of which each Subsidiary irrevocably and unconditionally guaranties to Agent
Bank on behalf of the Banks the full and prompt payment and performance of all
Obligations.
"Swingline Advance" shall mean each advance made by Swingline Lender to
Borrowers under the Swingline Facility.
"Swingline Facility" shall mean the agreement of Swingline Lender to make
Swingline Advances to Borrowers subject to the terms and conditions and up to
the maximum amounts and for the duration as set forth in Section 2.08 of this
Credit Agreement.
"Swingline Lender" shall have the meaning set forth in the Preamble of this
Credit Agreement.
"Swingline Note" shall mean the Swingline Note, a copy of which is marked
"Exhibit P", affixed hereto and by this reference incorporated herein and made a
part hereof, to be executed by Borrowers on the Closing Date, payable to the
order of Swingline Lender evidencing the Swingline Facility, as the same may be
amended or restated from time to time.
"Swingline Outstandings" shall mean the aggregate amount of all outstanding
and unpaid Swingline Advances as of each date of determination.
"Syndication Costs" shall mean collective reference to all costs and
expenses incurred by Agent Bank in connection with the sale, transfer and/or
assignment of a Syndication Interest to any other Lender.
"Syndication Interest" shall mean the proportionate interest of each Lender
in the Credit Facility as set forth on the Schedule of Lenders' Proportions in
Credit Facility, as the same may be amended or restated from time to time.
"Tangible Net Worth" shall mean Assets, excluding Intangibles, less
Liabilities, in each instance calculated without regard to Insider Non-Cash
Loans and Insider Cash Loans.
"Title Insurance Companies" shall mean collective reference to the MPI
Title Insurance Company, the SGLVI Title Insurance Company and the SGRI Title
Insurance Company.
"Title Insurance Endorsements" shall mean a collective reference to the
MPI Title Endorsements, the SGLVI Title Endorsements and the SGRI Title
Endorsements.
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"Title Insurance Policies" shall mean collective reference to the MPI Title
Insurance Policy, SGLVI Title Insurance and SGRI Title Insurance Policy.
"Trademark Security Agreement" shall mean the Trademark Security Agreement
which was executed by Borrowers on December 20, 1999, for the purpose of
granting a security interest in favor of Agent Bank on behalf of Lenders in all
trademarks, tradenames, copyrights and servicemarks used in connection with the
Hotel/Casino Facilities, including, without limitation each registration and
application set forth on Schedule 4.27 or otherwise described on Schedule A to
the Trademark Security Agreement, as such Trademark Security Agreement may be
amended, modified, extended, renewed or restated from time to time.
"Unsuitable Lender" shall have the meaning set forth in Section 10.10(d).
"Voluntary Permanent Reduction" shall have the meaning set forth in
Section 2.01(c).
"WFB" shall mean Wells Fargo Bank, National Association.
"West Virginia Gaming Authorities" shall mean the West Virginia State
Racing Commission and West Virginia State Lottery Commission and any other
applicable governmental or administrative state or local agency involved in the
regulation of gaming and gaming activities conducted by the Borrower
Consolidation in the State of West Virginia.
"Woodview Citizens Bank Documents" shall mean a collective reference to:
(i) that certain Deed of Trust encumbering the Woodview Real Property which is
executed by Robert H. Hillis, as borrower, for the benefit of The Citizens
Banking Company, as lender, and which is recorded in the Official Records of
Hancock County, West Virginia on February 4, 1994 in Book 313 at Page 609 as
Document No. 007556; (ii) the promissory note secured by said Deed of Trust
which is executed by the Woodview Partnership under date of January 31, 1994 and
is payable to the order of The Citizens Banking Company in the original
principal amount of Two Hundred Six Thousand Dollars ($206,000.00); and
(iii) that certain Commercial Loan Modification Agreement which is executed
under date of January 21, 1999 by the Woodview Partnership, MPI,
Robert B. Hillis, Randall J. Hillis and The Citizens Banking Company.
"Woodview Citizens Bank Estoppel" shall mean the Estoppel Certificate (the
Citizens Banking Company) which was duly executed by The Citizens Banking
Company on December 13, 1999, wherein it certified and represented to Agent Bank
on behalf of the Lenders that: (a) the Woodview Citizens Bank Documents
represent the
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entire agreement between The Citizens Banking Company and the borrowers under
the Woodview Citizens Bank Documents, (b) the Woodview Citizens Bank Documents
had not been modified, supplemented or amended except as described therein,
(c) to the best knowledge of The Citizens Banking Company, there were no
defaults then existing or continuing under the Woodview Citizens Bank Documents,
and (d) other provisions are set forth regarding notice to Agent Bank on behalf
of Lenders in the event of default under the Woodview Citizens Bank Documents
and the rights of Banks to cure any such default.
"Woodview Estoppel Certificates" shall mean a collective reference to the
Woodview Citizens Bank Estoppel and the Woodview Hillis Estoppel.
"Woodview Hillis Documents" shall mean a collective reference to: (i) that
certain Deed of Trust encumbering the Woodview Real Property which is executed
by MPI, as grantor, for the benefit of Robert B. Hillis and Randall J. Hillis,
as lenders, and which is recorded in the Official Records of Hancock County,
West Virginia on January 22, 1999 in Book 379 at Page 239 as Document No.
012844; and (ii) the promissory note secured by said Deed of Trust which is
executed by MPI under date of January 21, 1999 and is payable to the order of
Robert B. Hillis and Randall J. Hillis in the original principal amount of Six
Hundred Three Thousand Four Hundred Seventy-nine Dollars and Nine Cents
($603,479.09).
"Woodview Hillis Estoppel" shall mean an Estoppel Certificate (Hillis)
which was duly executed by Robert B. Hillis and Randall J. Hillis on December
14, 1999, wherein they certified and represented to Agent Bank on behalf of the
Lenders that: (a) the Woodview Hillis Documents represent the entire agreement
between them and MPI, (b) the Woodview Hillis Documents had not been modified,
supplemented or amended except as described therein, (c) to their best
knowledge, there were no defaults then existing or continuing under the Woodview
Hillis Documents, and (d) other provisions are set forth regarding notice to
Agent Bank on behalf of Lenders in the event of default under the Woodview
Hillis Documents and the rights of Banks to cure any such default.
"Woodview Loan Documents" shall mean a collective reference to the Woodview
Citizens Bank Documents and the Woodview Hillis Documents.
"Woodview Partnership" shall mean Woodview Golf Course, a West Virginia
general partnership.
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Section 1.02. INTERPRETATION AND CONSTRUCTION. In this Credit
Agreement, unless the context otherwise requires:
(a) Articles and Sections mentioned by number only are the respective
Articles and Sections of this Credit Agreement as so numbered;
(b) Words importing a particular gender mean and include every other
gender, and words importing the singular number mean and include the plural
number and VICE VERSA;
(c) All times specified herein, unless otherwise specifically referred,
shall be the time in San Francisco, California;
(d) Any headings preceding the texts of the several Articles and
Sections of this Credit Agreement, and any table of contents or marginal notes
appended to copies hereof, shall be solely for convenience of reference and
shall not constitute a part of this Credit Agreement, nor shall they affect its
meaning, construction or effect;
(e) If any clause, definition, provision or Section of this Credit
Agreement shall be determined to be apparently contrary to or conflicting with
any other clause, definition, provision or Section of this Credit Agreement then
the clause, definition, provision or Section containing the more specific
provisions shall control and govern with respect to such apparent conflict. The
parties hereto do agree that each has contributed to the drafting of this Credit
Agreement and all Loan Documents and that the provisions herein contained shall
not be construed against either Borrowers or Lenders as having been the person
or persons responsible for the preparation thereof;
(f) The terms "herein", "hereunder", "hereby", "hereto", "hereof" and
any similar terms as used in the Credit Agreement refer to this Credit
Agreement; the term "heretofore" means before the date of execution of this
Credit Agreement; and the term "hereafter" means after the date of the execution
of this Credit Agreement;
(g) All accounting terms used herein which are not otherwise
specifically defined shall be used in accordance with GAAP;
(h) If any clause, provision or Section of this Credit Agreement shall
be ruled invalid or unenforceable by any court of competent jurisdiction, such
holding shall not invalidate or render unenforceable any of the remaining
provisions hereof;
(i) Each reference to this Credit Agreement or any other Loan Document
or any of them, as used in this Credit Agreement or in any other Loan Document,
shall be deemed a reference to this Credit Agreement or such Loan Document,
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as applicable, as the same may be amended, modified, supplemented, replaced,
renewed or restated from time to time; and
(j) Every affirmative duty, covenant and obligation of Borrowers
hereunder shall be equally applicable to each of the Borrowers individually and
where the context would result in the best interests or rights of Banks shall be
construed to mean "Borrowers or any of them" or "Borrowers and each of them", as
applicable.
Section 1.03. USE OF DEFINED TERMS. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Credit Agreement shall have such meanings when used in the Revolving Credit
Note and in each Loan Document and other communication delivered from time to
time in connection with this Credit Agreement or any other Loan Document.
Section 1.04. CROSS-REFERENCES. Unless otherwise specified, references
in this Credit Agreement and in each other Loan Document to any Article or
Section are references to such Article or Section of this Credit Agreement or
such other Loan Document, as the case may be, and, unless otherwise
specified, references in any Article, Section or definition to any clause are
references to such clause of such Article, Section or definition.
Section 1.05. EXHIBITS AND SCHEDULES. All Exhibits and Schedules to
this Credit Agreement, either as originally existing or as the same may from
time to time be supplemented, modified or amended, are incorporated herein by
this reference.
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ARTICLE II
AMOUNT, TERMS AND SECURITY OF THE CREDIT FACILITY
Section 2.01. THE CREDIT FACILITY.
a. Subject to the conditions and upon the terms hereinafter set forth and
in accordance with the terms and provisions of the Revolving Credit Note, on and
after the Closing Date Lenders severally agree in the proportions set forth on
the Schedule of Lenders' Proportions in Credit Facility to lend and advance
Borrowings to Borrowers, up to the Maximum Permitted Balance, consisting of the
Closing Disbursements on the Closing Date and such amounts as Borrowers may
request during the Revolving Credit Period by Notice of Borrowing duly executed
by an Authorized Officer and delivered to Agent Bank from time to time for
Borrowings under the Credit Facility as provided in Section 2.03.
b. Subject to the uses and purposes set forth in Section 2.02, on and after
the Closing Date Borrowers may borrow, repay and reborrow the Available
Borrowings up to the Maximum Permitted Balance from time to time. Provided,
however, amounts of Funded Outstandings bearing interest with reference to a
LIBO Rate shall be subject to Breakage Charges incident to prepayment. The
Credit Facility shall be for a term commencing on the Closing Date and
terminating on the Maturity Date, on which date the entire outstanding balance
of the Credit Facility shall be fully paid and Credit Facility Termination shall
occur. In no event shall any Lender be liable to fund any amounts under the
Credit Facility in excess of its respective Syndication Interest in any
Borrowing.
c. Borrowers may voluntarily permanently reduce the Maximum Permitted
Balance from time to time (a "Voluntary Permanent Reduction") on the following
conditions:
(i) that each such Voluntary Permanent Reduction be in the minimum
amount of One Million Dollars ($1,000,000.00) and made in writing by an
Authorized Officer, effective on the fifth (5th) Banking Business Day
following receipt by Agent Bank;
(ii) that each such Voluntary Permanent Reduction shall be irrevocable
and a permanent reduction to the Maximum Permitted Balance; and
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(iii) in the event any Voluntary Permanent Reduction reduces the
Maximum Permitted Balance to less than the sum of the Funded Outstandings,
the Borrowers shall immediately cause the Funded Outstandings to be reduced
by such amount as may be necessary to cause the Funded Outstandings to be
equal to or less than the Maximum Permitted Balance.
Section 2.02. USE OF PROCEEDS OF THE CREDIT FACILITY. Available Borrowings
shall be used for the purposes of:
a. On the Closing Date (collectively the "Closing Disbursements"):
(i) continuing the outstanding principal balance under the Existing
Credit Facility as Funded Outstandings under the Credit Facility (and in
this regard each Lender agrees to advance its Pro Rata Share of the
outstanding principal balance under the Existing Credit Facility to Agent
Bank, to be retained by WFB, as the sole lender under the Existing Credit
Agreement, in exchange for such Lender's Syndication Interest in the Credit
Facility); and
(ii) paying in full the fees due Agent Bank as set forth in the Fee
Side Letter, the costs, fees and expenses of Title Insurance Companies
incurred in connection with the issuance of the Title Endorsements, the
costs, fees and expenses of the attorneys for Borrowers and the costs, fees
and expenses of Henderson & Morgan, LLC, attorneys for Agent Bank, and
associate counsel and insurance consultants retained by them incurred to
the Closing Date.
b. During the Revolving Credit Period:
(i) funding working capital needs of the Borrower Consolidation
relating to the Hotel/Casino Facilities;
(ii) funding ongoing Capital Expenditure requirements of the Borrower
Consolidation relating to the Hotel/Casino Facilities; and
(iii) funding for other general corporate purposes.
Section 2.03. NOTICE OF BORROWINGS AND EXERCISE OF INTEREST RATE
OPTIONS.
a. An Authorized Officer may give Agent Bank, no later than 9:00 a.m.
on any Banking Business Day at Agent Bank's office specified in Section 2.07,
three
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(3) full Banking Business Days prior written notice in the form of the
Notice of Borrowing ("Notice of Borrowing"), a copy of which is marked "Exhibit
C", affixed hereto and by this reference incorporated herein and made a part
hereof, for each proposed Borrowing to be made with reference to a LIBO Rate and
at least one (1) full Banking Business Day prior notice for all other
Borrowings, specifying the date and amount of each proposed Borrowing. Agent
Bank shall give prompt notice of each Notice of Borrowing to Lenders of the
amount to be funded and specifying the Funding Date. Not later than 11:00 a.m.
on the Funding Date specified, each Lender shall disburse to Agent Bank its Pro
Rata Share of the amount to be advanced by each such Lender in lawful money of
the United States of America and in immediately available funds. Agent Bank
shall make the proceeds of such fundings received by it on or before 11:00 a.m.
from the Lenders available to Borrowers by depositing, prior to 1:00 p.m. on the
day so received (but not prior to the Funding Date) in the Designated Deposit
Account maintained with Agent Bank, the amounts received from the Lenders. No
Borrowing may exceed the Available Borrowings. Each Borrowing to be made with
reference to the Base Rate shall be in a minimum amount of Five Hundred Thousand
Dollars ($500,000.00) and in increments of One Hundred Thousand Dollars
($100,000.00). Borrowers shall be entitled to no more than three (3) Borrowings
during each calendar month, exclusive of Borrowings made for the sole purpose of
funding repayment of a Swingline Advance.
b. The failure of any Lender to fund its Pro Rata Share of any
Borrowing on any Funding Date shall neither relieve any other Lender of any
obligation hereunder to fund its Pro Rata Share of such Borrowing on such
Funding Date nor relieve such Lender which has failed to fund its Pro Rata Share
of its obligations to Borrowers hereunder. No Lender shall be responsible for
the failure of any other Lender to fund its Pro Rata Share of such Borrowing on
any Funding Date nor shall any Lender be responsible for the failure of any
other Lender to perform its respective obligations hereunder. The provisions set
forth in Section 10.10(d) shall be applicable to a Defaulting Lender to the same
extent as if such Defaulting Lender was found to be an Unsuitable Lender.
Section 2.04. CONDITIONS OF BORROWINGS. Borrowings, other than
Borrowings made at the request of Agent Bank for the purpose of funding
repayment of Swingline Outstandings as hereinafter provided, will only be
made so long as Borrowers are in full compliance with each of the
requirements and conditions precedent set forth in Article III B of this
Credit Agreement; provided, however, upon the consent of Requisite Lenders,
Lenders shall advance Borrowings notwithstanding the existence of less than
full compliance with the requirements of Article III B and Borrowings so made
shall be deemed to have been made pursuant to this Credit Agreement.
Section 2.05. THE REVOLVING CREDIT NOTE AND INTEREST RATE OPTIONS.
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a. The Credit Facility shall be further evidenced by the Revolving Credit
Note payable to the order of Agent Bank on behalf of the Lenders. Agent Bank
shall record manually or electronically the date and amount of each Borrowing
advanced by the Lenders together with the applicable Interest Period in the case
of portions of the unpaid principal under the Credit Facility bearing interest
with reference to a LIBO Rate, and the amount of each repayment of principal
made thereunder by Borrowers and the entry of such records shall be conclusive
absent manifest or demonstrable error; provided, however, the failure to make
such a record or notation with respect to any Borrowing or repayment thereof, or
an error in making such a record or notation, shall not limit or otherwise
affect the obligations of Borrowers hereunder or under the Revolving Credit
Note.
b. Interest shall accrue on the entire outstanding principal balance of the
Credit Facility at a rate per annum equal to the Base Rate plus the Applicable
Margin, unless Borrowers request a LIBOR Loan pursuant to Section 2.03 or elect
pursuant to Section 2.05(c) hereinbelow to have interest accrue on a portion or
portions of the outstanding principal balance of the Credit Facility at a LIBO
Rate ("Interest Rate Option"), in which case interest on such portion or
portions shall accrue at a rate per annum equal to such LIBO Rate plus the
Applicable Margin in effect as of the second Banking Business Day prior to the
first day of the applicable Interest Period, as long as: (i) each such LIBOR
Loan is in a minimum amount of Five Million Dollars ($5,000,000.00) plus minimum
increments of One Million Dollars ($1,000,000.00), or such lesser amount as
equals the Maximum Permitted Balance, and (ii) no more than five (5) LIBOR Loans
may be outstanding at any one time. Interest accrued on each Base Rate Loan
shall be due and payable on the first day of the month following the Closing
Date, on the first day of each successive month thereafter, and on the Maturity
Date. For each LIBOR Loan, accrued interest shall be due and payable at the end
of each Interest Period applicable thereto, but in any event no less frequently
than at the end of each three (3) month period during the term of such LIBOR
Loan. Agent Bank shall notify Borrower in writing five (5) Banking Business Days
prior to each payment of interest due herewith, detailing the amount owed and
the calculation thereof. Except as qualified above, the outstanding principal
balance hereunder may be a Base Rate Loan or one or more LIBOR Loans, or any
combination thereof, as Borrowers shall specify.
c. So long as no Default or Event of Default shall have occurred and
remains continuing, Borrowers may Convert from one Interest Rate Option to
another Interest Rate Option or continue an Interest Rate Option for another
Interest Period by giving irrevocable notice to Agent Bank of such Conversion by
9:00 a.m., on a day which is at least three (3) Banking Business Days prior to
the proposed date of such Conversion to or Continuation of each LIBOR Loan or
one (1) Banking Business Day prior to the proposed date of such Conversion to
each Base Rate Loan. Each such
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notice shall be made by an Authorized Officer by telephone and thereafter
immediately confirmed in writing by delivery to Agent Bank of a
Continuation/Conversion Notice specifying the date of such Conversion or
Continuation, the amounts to be so Converted or Continued and the Interest
Period if the Conversion or Continuation is being made with reference to a LIBOR
Loan. Upon receipt of such Continuation/Conversion Notice, Agent Bank shall
promptly set the applicable interest rate (which in the case of a LIBOR Loan
shall be the LIBO Rate plus the Applicable Margin as of the second Banking
Business Day prior to the first day of the applicable Interest Period) and the
applicable Interest Period if the Conversion or Continuation is being made with
reference to a LIBOR Loan and shall confirm the same in writing to Borrowers and
Lenders. Each Conversion or Continuation shall be on a Banking Business Day. No
LIBOR Loan shall be converted to a Base Rate Loan or renewed on any day other
than the last day of the current Interest Period relating to such amounts
outstanding unless Borrowers pay any applicable Breakage Charges. All Borrowings
advanced at the request of Agent Bank under Section 2.08 of the Credit Agreement
shall bear interest with reference to the Base Rate plus the Applicable Margin,
subject to Borrowers' right to Convert such Borrowing to a LIBOR Loan or LIBOR
Loans as provided herein. If Borrowers fail to give a Continuation/Conversion
Notice for the continuation of a LIBOR Loan as a LIBOR Loan for a new Interest
Period in accordance with this Section 2.05(c), such LIBOR Loan shall
automatically become a Base Rate Loan at the end of its then current Interest
Period.
d. Each interest period (each individually an "Interest Period" and
collectively the "Interest Periods") for a LIBOR Loan shall commence on the date
such LIBOR Loan is made or the date of Conversion or Continuation of any amount
or amounts of the outstanding Borrowings hereunder to a LIBOR Loan, as the case
may be, and shall end on the date which is one (1), two (2), three (3) or six
(6) months thereafter, as elected by Borrowers. However, no Interest Period may
extend beyond the Maturity Date. Each Interest Period for a LIBOR Loan shall
commence and end on a Banking Business Day. If any Interest Period commences on
a date for which there is no corresponding date in the month in which it is
scheduled to end, such Interest Period shall end on the last Banking Business
Day of such month. If any Interest Period would otherwise expire on a day which
is not a Banking Business Day, the Interest Period shall be extended to expire
on the next succeeding Banking Business Day, unless the result of such extension
would be to carry such Interest Period into another calendar month, in which
event such Interest Period shall end on the immediately preceding Banking
Business Day.
e. The applicable LIBO Rate and Base Rate shall be determined by the Agent
Bank, and notice thereof shall be given promptly to Borrowers and Lenders. Each
determination of the applicable Base Rate and LIBO Rate shall be
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conclusive and binding upon the Borrowers, in the absence of manifest or
demonstrable error. The Agent Bank shall, upon written request of Borrowers or
any Lender, deliver to Borrowers or such Lender, as the case may be, a statement
showing the computations used by the Agent Bank in determining any rate
hereunder.
f. Computation of fees and interest on all Base Rate Loans and LIBOR Loans
shall be calculated on the basis of a year of three hundred sixty (360) days and
the actual number of days elapsed. The applicable Base Rate shall be effective
the same day as a change in the Base Rate is announced by WFB as being
effective.
g. If with respect to any Interest Period, (a) the Agent Bank reasonably
determines (which determination shall be binding and conclusive on Borrowers)
that by reason of circumstances affecting the inter-bank eurodollar market
adequate and reasonable means do not exist for ascertaining the applicable LIBO
Rate, or (b) Requisite Lenders advise Agent Bank that the LIBO Rate as
determined by Agent Bank will not adequately and fairly reflect the cost to such
Lenders of maintaining or funding, for such Interest Period, a LIBOR Loan under
the Credit Facility, then so long as such circumstances shall continue: (i)
Agent Bank shall promptly notify Borrowers thereof, (ii) the Lenders shall not
be under any obligation to make a LIBOR Loan or Convert a Base Rate Loan into a
LIBOR Loan for which such circumstances exist, and (iii) on the last day of the
then current Interest Period, the LIBOR Loan for which such circumstances exist
shall, unless then repaid in full, automatically Convert to a Base Rate Loan.
h. Notwithstanding any other provisions of the Credit Agreement, if, after
the Closing Date, any law, rule, regulation, treaty, interpretation or directive
(whether having the force of law or not) or any change therein shall make it
unlawful for any Lender to make or maintain LIBOR Loans, then (i) the commitment
and agreement to maintain LIBOR Loans as to such Lender shall immediately be
suspended, and (ii) unless required to be terminated earlier, LIBOR Loans as to
such Lender, if any, shall be Converted on the last day of the then current
Interest Period applicable thereto to Base Rate Loans. If it shall become lawful
for such Lender to again maintain LIBOR Loans, then Borrowers may once again as
to such Lender request Conversions to the LIBO Rate. During any period of such
suspension, such Lender shall make Base Rate Loans.
i. The Borrowers agree that upon written notice by: (y) Agent Bank or (z)
any Lender to the Borrowers (with a copy of such notice concurrently
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delivered to Agent Bank) to the effect that a promissory note or other evidence
of indebtedness is required for such Lender by a Governmental Authority, banking
regulatory agency or regulatory audit in order for such Lender to evidence
(whether for the purposes of pledge, enforcement or otherwise) the Borrowings
owing to, or to be made by, such Lender:
(i) The Borrowers shall promptly execute and deliver to each Lender a
promissory note payable to the order of each such Lender (each individually
a "Replacement Note" and collectively the "Replacement Notes") in the form
of the Revolving Credit Note in the amount of each Lender's respective
Syndication Interest in the Credit Facility;
(ii) The Replacement Notes shall, in the aggregate, fully replace the
Revolving Credit Note and each reference to the Revolving Credit Note in
this Credit Agreement and each of the Loan Documents shall be deemed to be
a collective reference to the Replacement Notes;
(iii) Borrowings, Interest Rate Options, Construction/Conversion
Notices and all other provisions for the disbursement of funds, setting of
interest rates and collection of repayments of interest and principal shall
continue to be made by Agent Bank as the administrative and collateral
agent for the Lenders in the same manner and to the same extent as provided
in the Revolving Credit Note and this Credit Agreement as fully applicable
to each of the Replacement Notes;
(iv) the Agent Bank, upon the consent of Requisite Lenders, shall
cause the Title Insurance Company to issue, at the expense of Lenders, such
endorsements to the Title Insurance Policies as may be reasonably necessary
to assure the aggregate obligation evidenced by the Replacement Notes is
secured by the Deed of Trust with the same coverage and priority as the
obligation evidenced by the Revolving Credit Note; and
(v) Concurrently with the delivery of the Replacement Notes, Agent
Bank shall return the original Revolving Credit Note to Borrower marked as
superseded and replaced by the Replacement Notes.
Section 2.06. SECURITY FOR THE CREDIT FACILITY. The Security Documentation
shall secure the due and punctual payment and performance of the terms and
provisions of this Credit Agreement, the Revolving Credit Note and all of the
other Loan Documents. In furtherance of such security, the Security Document
Amendments shall be executed and delivered to Agent Bank, as of the Closing
Date, by
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the respective parties to each of the Security Document Amendments and recorded
and/or filed as required by the Closing Instructions.
Section 2.07. PLACE AND MANNER OF PAYMENT.
a. All amounts payable by Borrowers to the Lenders shall be made to Agent
Bank on behalf of Lenders pursuant to the terms of the Credit Agreement and the
Notes and shall be made on a Banking Business Day in lawful money of the United
States of America and in immediately available funds. Other than in connection
with principal payments which may be required to decrease the Funded
Outstandings to an amount equal to or less than the Maximum Permitted Balance,
Borrowers shall not make repayments ("Principal Prepayments") of the outstanding
balance of principal owing under the Revolving Credit Note more frequently than
three (3) such Principal Prepayments during each calendar month. Each such
Principal Prepayment of a Base Rate Loan shall be in a minimum amount of One
Million Dollars ($1,000,000.00) (or, if less, the outstanding principal amount
of Base Rate Loans) and in increments of One Hundred Thousand Dollars
($100,000.00) in excess thereof. Each such Principal Prepayment of a LIBOR Loan
shall be in a minimum amount of Five Million Dollars ($5,000,000.00) and in
increments of One Million Dollars ($1,000,000.00) in excess thereof; provided,
that in no event shall any outstanding LIBOR Loan have a principal balance of
less then Five Million Dollars ($5,000,000.00).
b. All such amounts payable by Borrowers shall be made to Agent Bank at its
office located at Wells Fargo Bank, Syndications Division, 201 Third Street,
Eighth Floor, San Francisco, California 94103, or at such other address as may
be directed in writing by Agent Bank from time to time. If such payment is
received by Agent Bank prior to 11:00 a.m., Agent Bank shall credit Borrowers
with such payment on the day so received and shall promptly disburse to the
appropriate Lenders on the same day the Pro Rata Share of payments relating to
the Credit Facility, in immediately available funds. If such payment is received
by Agent Bank after 11:00 a.m., Agent Bank shall credit Borrowers with such
payment as of the next Banking Business Day and disburse to the appropriate
Lenders on the next Banking Business Day such Pro Rata Share of such payment
relating to the Credit Facility in immediately available funds. Any payment on
the Credit Facility made by Borrowers to Agent Bank pursuant to the terms of
this Credit Agreement or the Revolving Credit Note for the account of Lenders
shall constitute payment to the appropriate Lenders. If the Revolving Credit
Note or any payment required to be made thereon or hereunder, is or becomes due
and payable on a day other than a Banking Business Day, the due date thereof
shall be extended to the next succeeding Banking Business Day and interest
thereon shall be payable at the then applicable rate during such extension.
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c. Subject to Section 2.07(a), the outstanding principal owing under the
Credit Facility and the Revolving Credit Note may be prepaid at any time in
whole or in part without penalty; provided, however, that any portion or
portions of the unpaid principal balance which is accruing interest at a LIBO
Rate may only be prepaid or repaid on the last day of the applicable Interest
Period unless Borrowers give three (3) days prior written notice to Agent Bank
and additionally pay concurrently with such prepayment or repayment such
additional amount or amounts as will compensate Lenders for any losses, costs or
expenses which they may incur as a result of such payment, including, without
limitation, any loss (including loss of anticipated profits), cost or expense
incurred by the liquidation or reemployment of deposits or other funds acquired
by such Lender to fund or maintain such LIBOR Loan ("Breakage Charges"). A
certificate of a Lender as to amounts payable hereunder shall be conclusive and
binding on Borrowers for all purposes, absent manifest or demonstrable error.
Any calculation hereunder shall be made on the assumption that each Lender has
funded or will fund each LIBOR Loan in the London interbank market; PROVIDED
that no Lender shall have any obligation to actually fund any LIBOR Loan in such
manner.
d. Unless the Agent Bank receives notice from an Authorized Officer prior
to the date on which any payment is due to the Lenders that the Borrowers will
not make such payment in full as and when required, the Agent Bank may assume
that the Borrowers have made such payment in full to the Agent Bank on such date
in immediately available funds and the Agent Bank may (but shall not be so
required), in reliance upon such assumption, distribute to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent the Borrowers have not made such payment in full to the Agent Bank, each
Lender shall repay to the Agent Bank on demand such amount distributed to such
Lender, together with interest thereon at the Federal Funds Rate for each day
from the date such amount is distributed to such Lender until the date repaid.
e. If, other than as expressly provided elsewhere herein, any Lender shall
obtain any payment with respect to the Credit Facility (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) in
excess of its Syndication Interest, such Lender shall immediately (a) notify the
Agent Bank of such fact, and (b) purchase from the other Lenders such
participations in the Credit Facility as shall be necessary to cause such
purchasing Lender to share the excess payment with each of them in proportion to
their respective Syndication Interests; PROVIDED, however, that if all or any
portion of such excess payment is thereafter recovered from the purchasing
Lender, such purchase shall to that extent be rescinded and each other Lender
shall repay to the purchasing Lender the purchase price paid therefor, together
with an amount equal to such paying Lender's ratable share (according to the
proportion of (i) the amount of such paying Lender's required repayment to
(ii) he total amount so
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recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Borrowers agree that any Lender so purchasing a participation from another
Lender may, to the fullest extent permitted by law, exercise all its rights of
payment with respect to such participation as fully as if such Lender were the
direct creditor of the Borrowers in the amount of such participation. The Agent
Bank will keep records (which shall be conclusive and binding in the absence of
manifest or demonstrable error) of each participation purchased under this
section and will in each case notify the Lenders following any such purchases or
repayments.
Section 2.08. THE SWINGLINE FACILITY.
a. Subject to the conditions and upon the terms hereinafter set forth and
in accordance with the terms and provisions of the Swingline Note, Exhibit P
affixed hereto, on and after the Closing Date, Swingline Lender agrees to lend
and advance Swingline Advances to Borrowers in the amounts and at the times
provided below. Notwithstanding anything herein contained to the contrary,
however, Borrower shall not be entitled to any Swingline Advances on and after
the date which is ten (10) calendar days prior to the Maturity Date.
b. With respect to each proposed Swingline Advance, an Authorized Officer
shall give Swingline Lender written notice in the form of the Notice of
Swingline Advance ("Notice of Swingline Advance"), a copy of which is marked
"Exhibit Q", affixed hereto and by this reference incorporated herein and made a
part hereof, to be received by Swingline Lender no later than 12:00 noon on the
date for each proposed Swingline Advance specifying the requested amount to be
funded or oral notice to be received by Swingline Lender no later than 12:00
noon on such date, to be followed by a duly completed and executed Notice of
Swingline Advance no later than 1:00 p.m. on the same date. Swingline Lender
shall, on the date for each proposed Swingline Advance, deposit into the
Designated Deposit Account in lawful money of the United States of America in
immediately available funds such amounts as Borrowers may request; provided,
that: (i) after giving effect to such Swingline Advance, the Swingline
Outstandings shall not exceed Five Million Dollars ($5,000,000.00), (ii) the
amount requested does not exceed the Available Borrowings, (iii) no Default or
Event of Default has occurred and is continuing, and (iv) the conditions
precedent set forth in Sections 3.23 and 3.24 shall have been satisfied. Within
the foregoing limitations, Borrowers may borrow, repay and reborrow under the
Swingline Facility. Each Swingline Advance shall be in an integral multiple of
One Hundred Thousand Dollars ($100,000.00). Promptly after receipt of each
request for a Swingline Advance, Swingline Lender shall obtain telephonic
verification from Agent Bank that, giving effect to such request, the amount of
such request does not exceed the then Available Borrowings (such verification to
be promptly confirmed in writing). Unless notified to the contrary by the
Swingline Lender, each repayment of a
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Swingline Advance shall be in an amount which is an integral multiple of One
Hundred Thousand Dollars ($100,000.00), together with the accrued interest
thereon. The Swingline Lender shall promptly notify the Agent Bank of the
Swingline Outstandings each time there is a change therein.
c. Each Swingline Advance shall bear interest at the Base Rate plus the
Applicable Margin and shall be payable at the times and in the manner set forth
below and, in any event, on or before ten (10) days prior to the Maturity Date.
Unless otherwise paid, interest accrued on the unpaid balance of Swingline
Outstandings for the period commencing on the first calendar day and ending on
the last calendar day of each and every month shall be paid monthly in arrears
on or before the fifth (5th) day following receipt by Borrowers of an invoice
from Swingline Lender setting forth the amount of such accrued interest. In the
event any Swingline Advance is outstanding for ten (10) consecutive Banking
Business Days or as of the tenth (10th) day prior to the Maturity Date, then on
the next Banking Business Day (unless Borrowers have made other arrangements
acceptable to the Swingline Lender to pay the Swingline Outstanding in full or
to continue such Swingline Outstanding), Borrowers shall request a Borrowing
under the Credit Facility in an amount sufficient to pay the applicable
Swingline Advance in full, together with all interest accrued thereon. Upon
receipt of the amount of the Borrowing from the Lenders, the Agent Bank shall
provide such amount to the Swingline Lender for repayment of the applicable
Swingline Advance and the balance of the Borrowing, if any, shall be deposited
in immediately available funds to the Designated Deposit Account. In the event
Borrowers fail to request a Borrowing within the period specified above, Agent
Bank shall, without notice to the Borrowers and without regard to any other
conditions precedent for the making of Borrowings under the Credit Facility,
including, without limitation the remedies set forth in Section 7.02, promptly
(but subject to the notice periods for Borrowings set forth in Section 2.03)
cause a Borrowing to be made and funded by the Lenders under the Credit Facility
in the amount necessary to pay the applicable Swingline Advance in full,
together with all interest accrued thereon, to the extent of Available
Borrowings, and the Borrowers shall be deemed to have requested such Borrowing
and consented to its being made as provided for herein.
d. Each Lender's obligation to advance Borrowings in the proportionate
amount of its Syndication Interest in the Credit Facility of any unreimbursed
Swingline Outstandings pursuant hereto is several, and not joint or joint and
several. The failure of any Lender to perform its obligation to advance a
Borrowing in a proportionate amount of such Lender's Syndication Interest of any
unreimbursed Swingline Outstandings shall neither relieve any other Lender of
its obligation hereunder to advance such Borrowing in the amount of such other
Lender's proportionate Syndication Interest of such amount, nor relieve the
Lender which has failed to fund of its obligations to Borrowers hereunder. The
Borrowers agree to accept the Borrowings for payment of Swingline
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Outstandings as provided hereinabove, whether or not such Borrowings could have
been made pursuant to the terms of Article III B or any other section of this
Credit Agreement.
Section 2.09. FEES.
a. On the Closing Date and on each other applicable date, Borrowers shall
pay the fees as required in the Fee Side Letter, each of such fees to be
retained by Agent Bank or distributed to Lenders as agreed between Agent Bank
and each Lender.
b. Borrowers shall pay a quarterly nonusage fee (the "Commitment Fee") to
the Agent Bank for the account of Lenders based on the Leverage Ratio,
calculated as of each Fiscal Quarter end following the Closing Date with
reference to the Borrower Consolidation, to determine the applicable Commitment
Percentage determined as set forth in Table Two of the definition of Applicable
Margin. As of the Closing Date, the Commitment Percentage shall be set in
accordance with the Pricing Certificate to be delivered by Borrowers to Agent
Bank on the Closing Date pursuant to Section 3.04.
The Commitment Fee shall commence to accrue on the Closing Date and shall be
calculated as the product of (i) the applicable Commitment Percentage multiplied
by (ii) the daily average of the Maximum Permitted Balance less the daily
average of the Funded Outstandings computed on the basis of a three hundred
sixty (360) day year based on the number of actual days elapsed. Each Commitment
Fee shall be payable in arrears on a quarterly basis on or before the fifth
(5th) day following receipt by Borrowers of an invoice from Agent Bank setting
forth the amount of such Commitment Fee for each applicable Fiscal Quarter, and
upon Bank Facility Termination. Each Commitment Fee shall be promptly
distributed by Agent Bank to Lenders in proportion to their respective
Syndication Interests in the Credit Facility, as in effect from time to time
during each applicable Fiscal Quarter.
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Section 2.10. LATE CHARGES AND DEFAULT RATE.
a. If any payment due under the Revolving Credit Note is not paid within
three (3) Banking Business Days after receipt by Borrowers of written notice of
such nonpayment from Agent Bank, Borrowers promise to pay a late charge in the
amount of three percent (3%) of the amount of such delinquent payment and Agent
Bank need not accept any late payment made unless it is accompanied by such
three percent (3%) late payment charge. Any late charge shall be paid to Lenders
in proportion to their respective Syndication Interests.
b. In the event of the existence of an Event of Default, commencing on the
first (1st) Banking Business Day following the receipt by Borrowers of written
notice of the occurrence of such Event of Default from Agent Bank, the total of
the unpaid balance of the principal and the then accrued and unpaid interest
owing under the Revolving Credit Note shall commence accruing interest at a rate
equal to two percent (2.0%) over the interest rate otherwise applicable to the
Revolving Credit Note (the "Default Rate") until all Events of Default which may
exist have been cured, at which time the interest rate shall revert to the rate
of interest otherwise accruing pursuant to the terms of the Revolving Credit
Note.
c. In the event of the occurrence of an Event of Default, Borrowers agree
to pay all reasonable costs of collection, including the reasonable attorneys'
fees incurred by Agent Bank, in addition to and at the time of the payment of
such sum of money and/or the performance of such acts as may be required to cure
such Event of Default. In the event legal action is commenced for the collection
of any sums owing hereunder or under the terms of the Revolving Credit Note, the
Borrowers agree that any judgment issued as a consequence of such action against
Borrowers shall bear interest at a rate equal to the Default Rate until fully
paid.
Section 2.11. NET PAYMENTS. All payments under this Credit Agreement and/or
the Revolving Credit Note shall be made without set-off, counterclaim,
recoupment or defense of any kind and in such amounts as may be necessary in
order that all such payments, after deduction or withholding for or on account
of any future taxes, levies, imposts, duties or other charges of whatsoever
nature imposed by the United States or any Governmental Authority, other than
franchise taxes or any tax on or measured by the gross receipts or overall net
income of any Lender pursuant to the income tax laws of the United States or any
State, or the jurisdiction where each Lender's principal office is located
(collectively "Taxes"), shall not be less than the amounts otherwise specified
to be paid under this Credit
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Agreement and the Revolving Credit Note. A certificate as to any additional
amounts payable to the Lenders under this Section 2.10 submitted to the
Borrowers by the Lenders shall show in reasonable detail an accounting of the
amount payable and the calculations used to determine in good faith such amount
and shall be conclusive absent manifest or demonstrable error. Any amounts
payable by the Borrowers under this Section 2.10 with respect to past payments
shall be due within ten (10) days following receipt by the Borrowers of such
certificate from the Lenders; any such amounts payable with respect to future
payments shall be due within ten (10) days after demand with such future
payments. With respect to each deduction or withholding for or on account of any
Taxes, the Borrowers shall promptly furnish to the Lenders such certificates,
receipts and other documents as may be required (in the reasonable judgment of
the Lenders) to establish any tax credit to which the Lenders may be entitled.
Section 2.12. INCREASED COSTS. If after the date hereof the adoption of, or
any change in, any applicable law, rule or regulation (including without
limitation Regulation D of the Board of Governors of the Federal Reserve System
and any successor thereto), or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender with any future request or future directive (whether or not having
the force of law) of any such Governmental Authority, central bank or comparable
agency:
a. Shall subject any Lender to any tax, duty or other charge with respect
to the Credit Facility and/or the Revolving Credit Note or such Lender's
obligation to make any funding of the Credit Facility, or shall change the basis
of taxation of payments to such Lender of the principal of, or interest on, the
Credit Facility or any other amounts due under the Revolving Credit Note in
respect of the Credit Facility or such Lender's obligation to fund the Credit
Facility (except for changes in the rate of tax on the overall net income of
such Lender imposed by the United States or any Governmental Authority pursuant
to the income tax laws of the United States or any State, or the jurisdiction
where each Lender's principal office is located); or
b. With respect to the Credit Facility or the obligation of the Lenders to
advance Borrowings under the Credit Facility shall impose, modify or deem
applicable any reserve imposed by the Board of Governors of the Federal Reserve
System, special deposit, capitalization, capital adequacy or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
any Lender; or
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c. Shall impose on any Lender any other condition affecting the Credit
Facility, the Revolving Credit Note or such Lender's obligation to advance
Borrowings under the Credit Facility;
and the result of any of the foregoing, as set forth in subsections (a), (b) or
(c) is to increase the cost to (or in the case of Regulation D or reserve
requirements referred to above or a successor thereto, to impose a cost on) such
Lender of making or maintaining the Credit Facility, or to reduce the amount of
any sum or rate of return received or receivable by such Lender under the
Revolving Credit Note, then within ten (10) days after demand by such Lender
(which demand shall be accompanied by a certificate setting forth the basis of
such demand), the Borrowers shall pay directly to such Lender such additional
amount or amounts as will compensate such Lender for such increased cost (or in
the case of Regulation D or reserve requirements referred to above or a
successor thereto, such costs which may be imposed upon such Lender) or such
reduction of any sum or rate of return received or receivable under the
Revolving Credit Note less the amount, if any, of the reduction of the Lenders'
tax liability to another taxing authority resulting from the payment of such
taxes. A certificate as to any additional amounts payable to any Lender under
this Section 2.11 submitted to the Borrowers by such Lender shall show in
reasonable detail an accounting of the amount payable and the calculations used
to determine in good faith such amount and shall be conclusive absent manifest
or demonstrable error.
Section 2.13. MITIGATION; EXCULPATION.
a. Each Lender agrees that it will promptly notify the Borrowers in writing
upon its becoming aware that any payments are to become due to it under this
Credit Agreement pursuant to Section 2.11 or 2.12. Each Lender further agrees
that it will use reasonable efforts not materially disadvantageous to it (in its
reasonable determination) in order to avoid or minimize, as the case may be, the
payment by the Borrowers of any additional amounts pursuant to Section 2.11 or
2.12. Each Lender represents, to the best of its knowledge, that as of the
Closing Date no such amounts are payable to it.
b. Borrowers shall not be liable to any Lender for any payments under
Section 2.11 or 2.12 arising to the extent of such Lender's gross negligence or
wilful misconduct or breach of any laws (other than as a result of Borrowers'
breach), or for amounts which were incurred more than ninety (90) days prior to
the date Borrowers are notified of the incurrence of such amount.
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ARTICLE III
CONDITIONS PRECEDENT TO THE CLOSING DATE
A. CLOSING CONDITIONS. The obligation of each of the Banks to fund any
Closing Disbursement under the Credit Facility is subject to the following
conditions precedent, each of which shall be satisfied on or before August 31,
2000 (unless all of the Banks, in their sole and absolute discretion, shall
agree otherwise). The occurrence of the Closing Date is subject to and
contingent upon Agent Bank having received, in each case in form and substance
reasonably satisfactory to Agent Bank, or in the case of an occurrence, action
or event, the occurrence of, each of the following:
Section 3.01. CREDIT AGREEMENT. Executed counterparts of this Credit
Agreement in sufficient duplicate originals for Borrowers and each of the Banks.
Section 3.02. THE NOTES.
a. On or before the Closing Date, the Revolving Credit Note duly
executed by the Borrowers in favor of Agent Bank shall be delivered to Agent
Bank.
b. On or before the Closing Date, the Swingline Note duly executed by
the Borrowers in favor of Swingline Lender shall be delivered to Swingline
Lender.
Section 3.03. SECURITY DOCUMENTATION. The Security Document Amendments duly
executed by each applicable Borrowers or other parties thereto, consisting of
the following:
WITH RESPECT TO THE MPI HOTEL/CASINO FACILITIES
a. Second Amendment to MPI Deed of Trust;
WITH RESPECT TO THE SGLVI HOTEL/CASINO FACILITY
b. Second Amendment to SGLVI Deed of Trust;
WITH RESPECT TO THE SGRI HOTEL/CASINO FACILITY
c. Second Amendment to SGRI Deed of Trust;
WITH RESPECT TO THE HOTEL/CASINO FACILITIES AND BORROWERS
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d. The Stock Pledges of all issued and outstanding stock of MPI, SGLVI
and SGRI, together with the Irrevocable Stock Powers and the originals of the
stock certificates pledged thereunder; and
e. Second Amendment to MTRI Security Agreement.
Section 3.04. COMPLIANCE AND PRICING CERTIFICATES. A Compliance Certificate
and a Pricing Certificate each prepared as of the Fiscal Quarter ended June 30,
2000, in each instance after giving pro forma effect to the occurrence of the
Closing Date.
Section 3.05. ARTICLES OF INCORPORATION, BYLAWS, CORPORATE RESOLUTIONS,
CERTIFICATES OF GOOD STANDING AND CLOSING CERTIFICATE. On or before the Closing
Date, Agent Bank shall have received from each of the Borrowers: (i) a
Certificate of Good Standing issued by the Secretary of State of the applicable
state of incorporation and dated within thirty (30) Banking Business Days of the
Closing Date, (ii) a copy of the articles of incorporation and by-laws certified
to be true and correct by a duly Authorized Officer of each respective Borrower,
(iii) an original Certificate of Corporate Resolution and Certificate of
Incumbency executed by the Secretary of each respective Borrower and attested to
by its President, Vice President, or Treasurer authorizing Borrowers to enter
into all documents and agreements to be executed by it pursuant to this Credit
Agreement and further authorizing and empowering the officer or officers who
will execute such documents and agreements with the authority and power to
execute such documents and agreements on behalf of each respective Borrower,
(iv) designation by corporate certificate ("Authorized Officer Certificate"),
substantially in the form of the Authorized Officer Certificate marked "Exhibit
F", affixed hereto and by this reference incorporated herein and made a part
hereof, of the officers of each respective Borrower who are authorized to give
Notices of Borrowing, Continuation/ Conversion Notices, Pricing Certificates,
Compliance Certificates and all other notices, requests, reports, consents,
certifications and authorizations on behalf of each of the Borrowers and the
Borrower Consolidation, each individually an "Authorized Officer" and
collectively the "Authorized Officers", and (v) an original closing certificate
("Closing Certificate"), substantially in the form of the Closing Certificate
marked "Exhibit G", affixed hereto and by this reference incorporated herein and
made a part hereof, duly executed by an Authorized Officer of Borrowers.
Section 3.06. OPINION OF COUNSEL. One or more opinions of counsel to the
Borrowers, dated as of the Closing Date and addressed to the Agent Bank on
behalf of itself and each of the Banks, together with their respective
successors and assigns,
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substantially in the form of the legal opinion marked "Exhibit I", affixed
hereto and by this reference incorporated herein and made a part hereof.
Section 3.07. TITLE INSURANCE POLICIES. As of the Closing Date, the Title
Insurance Endorsements (or proforma commitment for the issuance thereof)
consistent with the requirements of the Closing Instructions.
Section 3.08. SURVEY. If required by Title Insurance Company as a condition
for the issuance of the MPI Title Endorsements, a current boundary and location
survey for the MPI Real Property, subject to exceptions approved by Lenders
prior to the Closing Date, delivered to Agent Bank no less than ten (10) Banking
Business Days prior to the Closing Date, which, if so required, must (a) be
certified to Agent Bank and the MPI Title Insurance Company, (b) show the MPI
Real Property to be free of encroachments, overlaps, and other survey defects,
(c) show the courses and distances of the lot lines for the MPI Real Property,
(d) show that all existing improvements are located within said lot and building
lines, and (e) show the location of all above and below ground easements,
improvements, appurtenances, utilities, rights-of-way, water rights and ingress
and egress, by reference to book and page numbers and/or filed map reference. On
or before the Closing Date, Borrowers shall comply with all other survey
requirements of Title Insurance Companies for the issuance of the Title
Insurance Policies without reference to any exception of title based on any
survey requirement.
Section 3.09. PAYMENT OF TAXES. Evidence satisfactory to Agent Bank that
all past and current real and personal property taxes and assessments which are
presently due and payable applicable to the Collateral Properties have been paid
in full.
Section 3.10. INSURANCE. Copies of declaration pages of each insurance
policy, certified to be true and correct in all respects by an Authorized
Officer of Borrowers, together with original binders evidencing Borrowers as the
named insured, and original certificates of insurance, loss payee and mortgagee
endorsements naming Agent Bank as mortgagee, loss payee and additional insured
as required by the insurance provisions set forth in Section 5.09 of this Credit
Agreement.
Section 3.11. PAYMENT OF FEES. Payment by Borrowers to Agent Bank of the
fees to the extent then due and payable on the Closing Date as provided in
Section 2.09(a) hereinabove.
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Section 3.12. REIMBURSEMENT FOR EXPENSES AND FEES. Reimbursement by
Borrowers for all reasonable fees and out-of-pocket expenses incurred by Agent
Bank in connection with the Credit Facility, excluding, however, all Syndication
Costs, but including, but not limited to, escrow charges, title insurance
premiums, environmental examinations, recording fees, appraisal fees, reasonable
attorney's fees of Henderson & Morgan, LLC and insurance consultant fees, and
all other like fees and expenses remaining unpaid as of the Closing Date to the
extent then due and payable on the Closing Date, provided that the amount then
invoiced shall not thereafter preclude Borrowers' obligation to pay such costs
and expenses relating to the closing of the Credit Facility following the
Closing Date or to reimburse Agent Bank for the payment thereof.
Section 3.13. SCHEDULES OF SPACELEASES AND EQUIPMENT LEASES AND CONTRACTS.
The Schedules of Spaceleases (Schedules 4.15(A), (B) and (C)) and Equipment
Leases and Contracts (Schedules 4.16(A), (B) and (C)) in each instance setting
forth the name of the other party thereto, a brief description of each
spacelease, equipment lease and contract and the commencement and ending date
thereof.
Section 3.14. PHASE I ENVIRONMENTAL SITE ASSESSMENTS.
a. A Phase I Environmental Site Assessment or Assessments of the
Collateral Properties prepared in conformance with the scope and limitations of
ASTM Standard Designation E1527-93 and approved by Agent Bank. The Phase I
Environmental Site Assessments delivered to Agent Bank in connection with the
Existing Credit Facility shall be deemed to satisfy this requirement. Any
recommended action shall have been completed by Borrowers.
b. Borrowers hereby confirm the representations contained in Sections
2.1 and 2.2 of the Environmental Certificate are true and correct in all
respects, except with respect to the matters disclosed on the Schedule of
Significant Litigation.
Section 3.15. EVIDENCE OF RIGHT TO OCCUPANCY OF COLLATERAL PROPERTIES. A
copy of the permanent certificate of occupancy issued by each applicable
Governmental Authority, evidencing the right of the Borrower Consolidation to
use and hold open for the use and occupancy of the public of the Hotel/Casino
Facilities.
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Section 3.16. GAMING PERMITS. Copies of those Gaming Permits issued by each
applicable Gaming Authority evidencing the right of the Borrower Consolidation
to conduct pari-mutuel wagering on live horseracing and simulcast horse and
greyhound racing at the MPI Hotel/Casino Facilities and to conduct gaming
activities and games of chance at each of the Hotel/Casino Facilities.
Section 3.17. FINANCIAL STATEMENTS. Audited financial statements of the
Borrower Consolidation for the most recently ended Fiscal Year, to the extent
the same have been prepared and are available.
Section 3.18. SCHEDULE OF ALL SIGNIFICANT LITIGATION. A Schedule of
Significant Litigation (Schedule 3.18) involving any member of the Borrower
Consolidation, in each instance setting forth the names of the other parties
thereto, a brief description of such litigation, whether or not such litigation
is covered by insurance and, if so, whether the defense thereof and liability
therefor has been accepted by the applicable insurance company indicating
whether such acceptance of such defenses with or without a reservation of
rights, the commencement date of such litigation and the amount sought to be
recovered by the adverse parties thereto or the amount which is otherwise in
controversy.
Section 3.19. NO INJUNCTION OR OTHER LITIGATION. No law or regulation shall
prohibit, and no order, judgment or decree of any Governmental Authority shall,
and no litigation shall be pending or threatened which in the reasonable
judgment of the Agent Bank would or would reasonably be expected to, enjoin,
prohibit, limit or restrain the execution and delivery of this Credit Agreement
or the making of any advance under the Credit Facility.
Section 3.20. ADDITIONAL DOCUMENTS AND STATEMENTS. As of the Closing Date
such additional documents, affidavits, certificates and opinions as Requisite
Lenders may reasonably require to insure compliance with this Credit Agreement.
The statements set forth in Section 3.23 shall be true and correct.
Section 3.21. WOODVIEW LOAN DOCUMENTS AND LOGAN PURCHASE AGREEMENTS.
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a. A true and correct copy of the Woodview Loan Documents and of all
amendments and modifications thereto; and
b. A true and correct copy of the Logan Purchase Agreements and of all
amendments and modifications thereto.
B. CONDITIONS PRECEDENT TO ALL BORROWINGS. The obligation of each Lender
and Agent Bank to make any Borrowing requested to be made on any Funding Date is
subject to the occurrence of each of the following conditions precedent as of
such Funding Date: Section 2.22. NOTICE OF BORROWING. With respect to any
Borrowing, the Agent Bank shall have received in accordance with Section 2.03 on
or before such Funding Date an original and duly executed Notice of Borrowing or
facsimile copy thereof, to be promptly followed by an original.
Section 3.23. CERTAIN STATEMENTS. On the Closing Date and as of the Funding
Date the following statements shall be true and correct:
a. The representations and warranties with respect to the Borrowers
contained in Article IV hereof (other than representations and warranties which
expressly speak only as of a different date which shall be true and correct as
of such date) are true and correct on and as of the Funding Date and as of the
Closing Date in all material respects as though made on and as of that date,
except to the extent that such representations and warranties are not true and
correct as a result of a change which is permitted by this Credit Agreement or
by any other Loan Document, or which is otherwise consented to by Requisite
Lenders;
b. The representations and certifications contained in the
Environmental Certificate are true and correct in all material respects (other
than representations and warranties which expressly speak only as of a different
date which shall be true and correct as of such date);
c. Since the date of the most recent financial statements referred to
in Section 3.17 and 5.08(b), no Material Adverse Change shall have occurred; and
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d. No event has occurred or as a result of any Borrowings contemplated
hereby would occur and is continuing, or would result from the making thereof,
which constitutes a Default or Event of Default hereunder.
Section 3.24. GAMING PERMITS. The Borrower Consolidation shall have all
Gaming Permits material to or required for the conduct of its gaming businesses
and the conduct of games of chance at the Hotel/Casino Facilities and such
Gaming Permits shall not then be suspended, enjoined or prohibited (for any
length of time) by any Gaming Authority or any other Governmental Authority.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce Banks to enter into this Credit Agreement, Borrowers make the
following representations and warranties:
Section 4.01. ORGANIZATION; POWER AND AUTHORIZATION. MTRI is a corporation
duly organized and validly existing under the laws of the State of Delaware.
SGLVI and SGRI are each a corporation duly organized and validly existing under
the laws of the State of Nevada. MPI is a corporation duly organized and validly
existing under the laws of the State of West Virginia. Each Borrower (i) has all
requisite corporate power, authority and legal right to execute and deliver each
document, agreement or certificate to which it is a party or by which it is
bound in connection with the Credit Facility, to consummate the transactions and
perform its obligations hereunder and thereunder, and to own its properties and
assets and to carry on and conduct its business as presently conducted or
proposed to be conducted, and (ii) has taken all necessary corporate action to
authorize the execution, delivery and performance of this Credit Agreement and
the other Loan Documents to which it is a party or by which it is bound and to
consummate the transactions contemplated hereunder and thereunder.
Section 4.02. NO CONFLICT WITH, VIOLATION OF OR DEFAULT UNDER LAWS OR OTHER
AGREEMENTS. Neither the execution and delivery of this Credit Agreement, the
Revolving Credit Note or any other Loan Document, or any other agreement,
certificate or instrument to which any Borrower is a party or by which it is
bound in connection with the Credit Facility, nor the consummation of the
transactions contemplated hereunder or thereunder, nor the compliance with or
performance of the terms and conditions herein or therein, is prevented by,
limited by, conflicts in any material respect with, or will result in a material
breach or violation of, or a material default (with due notice or lapse of time
or both) under, or the creation or imposition of any lien, charge, or
encumbrance of any
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nature whatsoever upon any of their respective property or assets by virtue of,
the terms, conditions or provisions of (a) any indenture, evidence of
indebtedness, loan or financing agreement, or other agreement or instrument of
whatever nature to which any Borrower is bound, or (b) any provision of any
existing law, rule, regulation, order, writ, injunction or decree of any court
or Governmental Authority to which Borrowers are subject.
Section 4.03. LITIGATION. Except as disclosed on the Schedule of
Significant Litigation delivered in connection with Section 3.18, to the best
knowledge of Borrowers, after due inquiry and investigation, there is no action,
suit, proceeding, inquiry, hearing or investigation pending or threatened, in
any court of law or in equity, or before any Governmental Authority, which
reasonably would be expected to (a) result in any Material Adverse Change in the
operation of the Hotel/Casino Facilities or in its business, financial
condition, properties or operations, (b) materially adversely affect the
Borrowers' ability to perform their respective obligations under the Credit
Agreement and the other Loan Documents, or (c) materially adversely affect the
validity or enforceability of this Credit Agreement and the other Loan
Documents. To the best knowledge of Borrowers, after due inquiry and
investigation, no Borrower is in violation of or default with respect to any
order, writ, injunction, decree or demand of any Governmental Authority.
Section 4.04. AGREEMENTS LEGAL, BINDING, VALID AND ENFORCEABLE. This Credit
Agreement, the Revolving Credit Note, the Security Documentation and all other
Loan Documents, when executed and delivered by Borrowers in connection with the
Credit Facility will constitute legal, valid and binding obligations of
Borrowers, enforceable against Borrowers in accordance with their respective
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws of general application relating to or affecting the
enforcement of creditors' rights and the exercise of judicial discretion in
accordance with general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law).
Section 4.05. INFORMATION AND FINANCIAL DATA ACCURATE; FINANCIAL
STATEMENTS; NO ADVERSE EVENT. To the best of Borrowers' knowledge, information
and belief, all information and financial and other data previously furnished in
writing by Borrowers in connection with the Credit Facility was true, correct
and complete in all material respects as of the date furnished (unless
subsequently corrected prior to the date hereof), and there has been no Material
Adverse Change with respect thereto to the date of this Credit Agreement since
the dates thereof. No information has been omitted which would make the
information previously furnished in such financial statements to Banks
misleading or incorrect in any material respect to the date of this
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Credit Agreement. Any and all financial statements heretofore furnished to Banks
by Borrowers: (a) present fairly the financial position of Borrowers as of their
respective dates and the results of operations and changes in financial position
for the periods to which they apply, and (b) have been prepared in conformity
with GAAP applied on a consistent basis throughout the periods involved. Since
the date of the financial statements referred to in this Section 4.05, there has
been no Material Adverse Change in the financial condition, assets, liabilities,
business or operations of Borrowers.
Section 4.06. GOVERNMENTAL APPROVALS. All timely consents, approvals,
orders or authorizations of, or registrations, declarations, notices or filings
with any Governmental Authority which are required in connection with the valid
execution and delivery of this Credit Agreement and the other Loan Documents by
Borrowers and the carry-out or performance of any of the transactions required
or contemplated hereunder, or thereunder, by Borrowers, have been obtained or
accomplished and are in full force and effect, or can be obtained or
accomplished by Borrowers. To the best of Borrowers' knowledge, all timely
consents, approvals, orders or authorizations of, or registrations,
declarations, notices or filings with any Governmental Authority which are
required by Borrowers in connection with the use and operation of the
Hotel/Casino Facilities have been obtained or accomplished and are in full force
and effect.
Section 4.07. PAYMENT OF TAXES. To the best of Borrowers' knowledge,
Borrowers have duly filed or caused to be filed all federal, state and local tax
reports and returns which are required to be filed by them and have paid or made
provisions for the payment of, all material taxes, assessments, fees and other
governmental charges which have or may have become due pursuant to said returns
or otherwise pursuant to any assessment received by Borrowers except such taxes,
assessments, fees or other governmental charges, if any, as are being contested
in good faith by Borrowers by appropriate proceedings and for which Borrowers
have maintained adequate reserves for the payment thereof in accordance with
GAAP.
Section 4.08. TITLE TO PROPERTIES. To the best of Borrowers' knowledge,
Borrowers shall have good and marketable title to the Collateral Properties as
of the Closing Date and at all times during the term of the Credit Facility
(including, without limitation, the Logan Primary Parcel subsequent to the Logan
Primary Parcel Closing and the Logan Filly Parcel subsequent to the Logan Filly
Parcel Closing). Each of the Borrowers has good and marketable title to: (a) all
of its properties and assets reflected in the most recent financial statements
referred to in Section 4.05 hereof as owned by them (except those properties and
assets disposed of since the date of said financial statements in the ordinary
course of business or those properties and assets which are
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no longer used or useful in the conduct of its businesses), including, but not
limited to, Borrowers' interest in patents, trademarks, tradenames,
servicemarks, and licenses relating to or pertaining to the Collateral
Properties or the Hotel/Casino Facilities, and (b) all properties and assets
acquired by them subsequent to the date of the most recent financial statements
referred to in Section 4.05 hereof. All such properties and assets are not
subject to any liens, encumbrances or restrictions except Permitted
Encumbrances. All roads, easements and rights of way necessary for the full
utilization of the Collateral Properties have been completed and/or obtained.
Section 4.09. NO UNTRUE STATEMENTS. To the best of Borrowers' knowledge,
all statements, representations and warranties made by Borrowers in this Credit
Agreement, any other Loan Document and any other agreement, document,
certificate or instrument previously furnished or to be furnished by Borrowers
to Banks pursuant to the provisions of this Credit Agreement, at the time they
were made and on and as of the Closing Date: (a) are and shall be true, correct
and complete in all material respects, (b) do not and shall not contain any
untrue statement of a material fact, and (c) do not and shall not omit to state
a material fact, the absence of which makes the information contained herein or
therein materially misleading or incomplete. Borrowers understand that all such
statements, representations and warranties shall be deemed to have been relied
upon by Banks as a material inducement to establish the Credit Facility.
Section 4.10. BROKERAGE COMMISSIONS. Other than with respect to the fees to
be paid by Borrowers to Friedman, Billings and Ramsey, no person is entitled to
receive any brokerage commission, finder's fee or similar fee or payment in
connection with the extensions of credit contemplated by this Credit Agreement.
No brokerage or other fee, commission or compensation is to be paid by Banks
with respect to the extensions of credit contemplated hereby and Borrowers agree
to indemnify Banks against any such claims for brokerage fees or commissions and
to pay all expenses including, without limitation, reasonable attorney's fees
incurred by Banks in connection with the defense of any action or proceeding
brought to collect any such brokerage fees or commissions.
Section 4.11. NO DEFAULTS. No Borrower has received any notice, declaration
or similar correspondence or communication, oral or written, evidencing,
declaring or claiming a violation of any applicable law and/or regulations, the
violation of which materially and adversely affects the business, financial
condition or operations of the Hotel/Casino Facilities. Borrowers are not in
violation or default (nor is there any waiver in effect which, if not in effect,
would result in a violation or default) in any material and adverse respect
under any indenture, evidence of indebtedness, loan or
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financing agreement or other agreement or instrument of whatever nature to which
they are a party or by which they are bound (except for any defaults previously
brought to Banks' attention in writing, for which Borrowers have received a
waiver from Requisite Lenders), a default under which would reasonably be
expected to result in a Material Adverse Change.
Section 4.12. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. No
Reportable Event has occurred and is continuing with respect to any Pension Plan
under ERISA, that gives rise to liabilities that would constitute a Material
Adverse Change.
Section 4.13. AVAILABILITY OF UTILITY SERVICES. All utility services and
facilities necessary for the Hotel/Casino Facilities and the Collateral
Properties including, without limitation, electrical, water, gas and sewage
services and facilities are available at the boundaries of the Collateral
Properties.
Section 4.14. POLICIES OF INSURANCE. As of the Closing Date, each of the
copies of the declaration pages, original binders and certificates of insurance
evidencing the Policies of Insurance relating to the Hotel/Casino Facilities
delivered to Agent Bank by Borrowers (i) is a true, correct and complete copy of
the respective original thereof as in effect on the date hereof, and no
amendments or modifications of any of said documents or instruments not included
in such copies have been made, and (ii) has not been terminated and is in full
force and effect. Borrowers are not in default in the observance or performance
of their respective obligations under said documents and instruments, and
Borrowers have done all things required to be done as of the Closing Date to
keep unimpaired their respective rights thereunder.
Section 4.15. SPACELEASES. Schedules of all executed Spaceleases pertaining
to the Hotel/Casino Facilities, or any portion thereof, in existence as of the
Closing Date, are set forth on Schedules 4.15(A), (B) and (C) attached hereto.
Section 4.16. EQUIPMENT LEASES AND CONTRACTS. Schedules of all executed
Equipment Leases and Contracts pertaining to the Hotel/Casino Facilities or any
portion thereof, in existence as of the Closing Date, are set forth on Schedules
4.16 (A), (B) and (C) attached hereto.
Section 4.17. GAMING PERMITS AND APPROVALS. All Gaming Permits required to
be held by Borrowers are current and in good standing and Borrowers
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presently hold all Gaming Permits necessary for the continued operation of the
Hotel/Casino Facilities.
Section 4.18. ENVIRONMENTAL CERTIFICATE. The representations and
certifications contained in the Environmental Certificate are true and correct
in all material respects.
Section 4.19. INVESTMENT COMPANY ACT. Each Borrower is neither an
"investment company" nor a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended.
Section 4.20. PUBLIC UTILITY HOLDING COMPANY ACT. Each Borrower is neither
a "holding company," nor a "subsidiary company" of a "holding company," nor an
"affiliate" of a "holding company" nor of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
Section 4.21. LABOR RELATIONS. There is no strike or work stoppage in
existence, or to the best knowledge of Borrowers threatened, involving any
Borrower or the Hotel/Casino Facilities that reasonably would be expected to
result in a Material Adverse Change.
Section 4.22. TRADEMARKS, PATENTS, LICENSES, FRANCHISES, FORMULAS AND
COPYRIGHTS. Except as disclosed in Schedule 4.22, each of the Borrowers owns all
the patents, trademarks, permits, service marks, trade names, copyrights,
licenses, franchises and formulas, or has a valid license or sublicense of
rights with respect to the foregoing, and has obtained assignments of all leases
and other rights of whatever nature, necessary for the present conduct of its
respective businesses, without any known conflict with the rights of others
which, or the failure to obtain which, as the case may be, could reasonably be
expected to result in a Material Adverse Change on the business, operations,
property, assets or condition (financial or otherwise) of Borrowers. Each of the
patents, trademarks, servicemarks, tradenames and copyrights owned by Borrowers
under the common law or which is registered with any Governmental Authority is
set forth on Schedule 4.22, attached hereto.
Section 4.23. CONTINGENT LIABILITIES. As of the Closing Date, Borrowers
have incurred no material Contingent Liabilities (any Contingent Liability in
excess of One Million Dollars ($1,000,000.00) being deemed material) other than
those described on Schedule 4.23.
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Section 4.24. SUBSIDIARIES. As of the Closing Date, no member of the
Borrower Consolidation has any Subsidiaries that are not members of the Borrower
Consolidation, other than those Subsidiaries existing as of the Closing Date
which are described on the Schedule of Existing Subsidiaries attached hereto as
Schedule 4.24.
Section 4.25. WOODVIEW LOAN DOCUMENTS AND LOGAN PURCHASE AGREEMENTS. The
copies of the Woodview Loan Documents and Logan Purchase Agreements which have
been delivered to Agent Bank in accordance with Section 3.21 are true and
correct copies of the originals thereof. Said Woodview Loan Documents and Logan
Purchase Agreement are all in full force and effect, and none of them have been
amended or otherwise modified except as set forth by documents delivered to
Agent Bank in accordance with Section 3.21.
Section 4.26. PLEDGED STOCK. The stock certificates delivered to Agent Bank
in connection with the Stock Pledges represent one hundred percent (100%) of all
of the issued and outstanding stock of MTRI, SGLVI and SGRI.
ARTICLE V
GENERAL COVENANTS OF BORROWERS
To induce the Banks to enter into this Credit Agreement, Borrowers covenant
to Banks as follows:
Section 5.01. FF&E. The Borrower Consolidation shall furnish, fixture and
equip the Hotel/Casino Facilities with FF&E it reasonably deems appropriate for
the operation of the Hotel/Casino Facilities. All FF&E that is purchased and
installed in the Hotel/Casino Facilities shall be purchased free and clear of
any liens, encumbrances or claims, other than Permitted Encumbrances. If
Borrowers should sell, transfer, convey or otherwise dispose of any FF&E and not
replace such FF&E with purchased items of equivalent value and utility or
replace said FF&E with leased FF&E of equivalent value and utility, within the
permissible leasing and purchase agreement limitation set forth in Section
6.04(d) herein, to the extent the Net Proceeds thereof not used to replace FF&E
during the twelve (12) month consecutive period following the date of such sale,
transfer, conveyance or other disposition to the extent such Net Proceeds exceed
a cumulative aggregate value of One Million Dollars ($1,000,000.00) during the
term of the Credit Facility (the "Excess Capital Proceeds"), Borrowers shall be
required to permanently reduce the Maximum Permitted Balance of the Credit
Facility by a Voluntary Permanent Reduction in the amount of the Excess Capital
Proceeds of the FF&E so disposed of, subject, however, to the right of Agent
Bank to verify to its reasonable satisfaction the amount of said Excess Capital
Proceeds.
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Section 5.02. PERMITS; LICENSES AND LEGAL REQUIREMENTS. Borrowers shall
comply in all material respects with and keep in full force and effect, as and
when required, all Gaming Permits and all material permits, licenses and
approvals obtained from any Governmental Authorities which are required for the
operation and use of the Hotel/Casino Facilities. Borrowers shall comply in all
material respects with all applicable material existing and future laws, rules,
regulations, orders, ordinances and requirements of all Governmental
Authorities, and with all recorded restrictions affecting the Collateral
Properties.
Section 5.03. PROTECTION AGAINST LIEN CLAIMS. Borrowers shall promptly pay
and discharge or cause to be paid and discharged all claims and liens for labor
done and materials and services supplied and furnished in connection with the
Hotel/Casino Facilities in accordance with this Section 5.03, except such claims
and liens, if any, as are being contested in good faith by Borrowers by
appropriate proceedings and for which Borrowers have maintained adequate
reserves for the payment thereof in accordance with GAAP. If any mechanic's lien
or materialman's lien shall be recorded, filed or suffered to exist against the
Collateral Properties or any of them or any interest therein by reason of work,
labor, services or materials supplied, furnished or claimed to have been
supplied and furnished in connection with the Hotel/Casino Facilities, upon
Borrowers receipt of written notice from Agent Bank demanding the release and
discharge of such lien, said lien or claim shall be paid, released and
discharged of record within ninety (90) days following its receipt of such
notice, or, in lieu of such payment Borrowers may (i) with respect to the SGLVI
Hotel/Casino Facility and/or SGRI Hotel/Casino Facility cause said mechanic's
lien or materialman's lien to be released of record pursuant to the provisions
set forth in the Nevada Revised Statutes 108.2413, et. seq., within one hundred
twenty (120) days of the date of such notice; and (ii) to the extent that any
such mechanic's lien or materialman's lien shall be recorded, filed or suffered
to exist in the State of West Virginia, Borrowers shall cause said mechanic's
lien to be released of record pursuant to a bonding or similar statutory
procedure under the laws of the State of West Virginia, which statutory
procedures shall be reasonably acceptable to Agent Bank and accomplished within
one hundred twenty (120) days of the date of such notice.
Section 5.04. LOGAN PROPERTY.
a. Concurrently, or substantially concurrent, with occurrence of the
Logan Primary Parcel Closing, MPI shall execute and deliver, or cause the
execution and delivery of, such documents, and take such actions (including
without limitation the purchase of appropriate title insurance coverage) as may
be required in the reasonable discretion of Agent Bank in order to: (i) cause
the Logan Primary Parcel to be
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encumbered as Collateral hereunder subject only to MPI Permitted Encumbrances;
and (ii) provide Agent Bank with adequate assurances of such encumbrance and
priority.
b. Concurrently, or substantially concurrent, with occurrence of the
Logan Filly Parcel Closing, MPI shall execute and deliver, or cause the
execution and delivery of, such documents, and take such actions (including
without limitation the purchase of appropriate title insurance coverage) as may
be required in the reasonable discretion of Agent Bank in order to: (i) cause
the Logan Filly Parcel to be encumbered as Collateral hereunder subject only to
MPI Permitted Encumbrances; and (ii) provide Agent Bank with adequate assurances
of such encumbrance and priority.
Section 5.05. NO CHANGE IN CHARACTER OF BUSINESS OR LOCATION OF CHIEF
EXECUTIVE OFFICE. At all times throughout the term of the Credit Facility (a)
the chief executive office of Borrowers shall be located at State Route 2,
South, P.O. Box 356, Chester, West Virginia 26034; provided, however, Borrowers
shall be entitled to move their chief executive office to another location upon
no less than thirty (30) days prior written notice to Agent Bank, (b) the
Hotel/Casino Facilities shall be operated by the Borrower Consolidation, and (c)
Borrowers shall not effect a material change in the nature and character of the
business at the Hotel/Casino Facilities as presently conducted and as presently
contemplated and disclosed to Banks.
Section 5.06. PRESERVATION AND MAINTENANCE OF PROPERTIES AND ASSETS;
ACQUISITION OF ADDITIONAL PROPERTY.
a. At all times throughout the term of the Credit Facility, (i) the
Borrower Consolidation shall operate, maintain and preserve all rights,
privileges, franchises, licenses, Gaming Permits and other properties and assets
necessary to conduct its businesses and the Hotel/Casino Facilities, in
accordance with all applicable governmental laws, ordinances, approvals, rules
and regulations and requirements, including, but not limited to, zoning,
sanitary, pollution, building, environmental and safety laws and ordinances,
rules and regulations promulgated thereunder, and (ii) Borrowers shall not
consolidate with, remove, demolish, materially alter, discontinue the use of,
sell, transfer, assign, hypothecate or otherwise dispose of to any Person, any
part of its properties and assets necessary for the continuance of its business,
as presently conducted and as presently contemplated, other than in the normal
course of business, alterations or modifications as are reasonably expected to
increase the value of the Collateral, or as otherwise permitted pursuant to this
Credit Agreement.
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b. Furthermore, in the event any Borrower, or any Affiliate and/or
Related Entity thereof, shall acquire any other real property or rights to the
use of real property which is: (i) adjacent to any of the Collateral Properties
and used in a material manner in connection with the use and/or operation at the
Collateral Properties, the Hotel/Casino Facilities, or any of them, or (ii) if
not so adjacent, necessary and required for the use and operation of such
Collateral Property, Hotel/Casino Facilities, or any of them, Borrowers shall
concurrently with the acquisition of such real property or the rights to the use
of such real property, execute or cause the execution of such documents as may
be necessary to add such real property or rights to the use of real property as
Collateral under the Credit Facility.
Section 5.07. REPAIR OF PROPERTIES AND ASSETS. At all times throughout the
term of the Credit Facility, Borrowers shall, at their own cost and expense, (a)
maintain, preserve and keep in a manner consistent with hotel and gaming casino
operating practices, as the case may be, applicable to hotel/casino operations
operating in the jurisdictions in which such properties are located, its assets
and properties, including, but not limited to, the Collateral Properties and all
FF&E owned or leased by Borrowers in good and substantial repair, working order
and condition, ordinary wear and tear excepted, (b) from time to time, make or
cause to be made, all necessary and proper repairs, replacements, renewals,
improvements and betterments thereto, and (c) from time to time, make such
substitutions, additions, modifications and improvements as may be necessary and
as shall not impair the structural integrity, operating efficiency and economic
value of said assets and properties. All alterations, replacements, renewals, or
additions made pursuant to this Section 5.07 shall become and constitute a part
of said assets and property and subject, INTER ALIA, to the provisions of
Section 5.01 and subject to the lien of the Loan Documents.
Section 5.08. FINANCIAL STATEMENTS; REPORTS; CERTIFICATES AND BOOKS AND
RECORDS. Until Credit Facility Termination, Borrowers shall, unless the Agent
Bank (with the written approval of the Requisite Lenders) otherwise consents, at
Borrowers' sole expense, deliver to the Agent Bank and each of the Lenders a
full and complete copy of each of the following and shall comply with each of
the following financial requirements:
a. As soon as practicable, and in any event within forty-five (45) days
after the end of each Fiscal Quarter (including the fourth Fiscal Quarter in any
Fiscal Year), the consolidated and consolidating balance sheet, income
statement, statement of cash flows, statement of retained earnings and operating
statement for the calendar month under review and reflecting year-to-date
performance of the Borrower Consolidation and a comparison of the financial
performance of the Borrower
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Consolidation to the prior Fiscal Year's operations and projected results from
operations at the Hotel/Casino Facilities (in each case reconciled with year end
audited statements and compared to budget and prior year period) of the Borrower
Consolidation all in reasonable detail. Such financial statements shall be
certified by an Authorized Officer of the Borrower Consolidation as fairly
presenting the financial condition, results of operations and cash flows of the
Borrower Consolidation in accordance with GAAP (other than footnote disclosures)
as at such date and for such periods, subject only to normal year-end accruals
and audit adjustments;
b. As soon as practicable, and in any event within forty-five (45) days
after the end of each Fiscal Quarter (including the fourth (4th) Fiscal Quarter
in any Fiscal Year), a pricing certificate in the form marked "Exhibit E",
affixed hereto and by this reference incorporated herein and made a part hereof
(the "Pricing Certificate") setting forth a preliminary calculation of the
Leverage Ratio as of the last day of such Fiscal Quarter, and providing
reasonable detail as to the calculation thereof, which calculations shall be
based on the preliminary unaudited financial statements of the Borrower
Consolidation for such Fiscal Quarter, and as soon as practicable thereafter, in
the event of any material variance in the actual calculation of the Leverage
Ratio from such preliminary calculation, a revised Pricing Certificate setting
forth the actual calculation thereof; provided, however, that in the event that
Borrowers do not deliver a Pricing Certificate when due, then until (but only
until) such Pricing Certificate is delivered as provided herein, the Leverage
Ratio shall be deemed, for the purpose of determining the Applicable Margin, to
be greater than 2.5 to 1.0 and the Applicable Margin determined with respect
thereto.
c. As soon as practicable, and in any event within ninety (90) days
after the end of each Fiscal Year, (i) the consolidated and consolidating
balance sheet, income statement, statement of retained earnings and cash flows
(reconciled with year end audited statements) of the Borrower Consolidation as
at the end of such Fiscal Year, all in reasonable detail. Such financial
statements shall be prepared in accordance with GAAP and shall be accompanied by
a report of independent public accountants of recognized standing selected by
Borrowers and reasonably satisfactory to the Agent Bank (it being understood
that BDO Seidman, LLP or any "Big 5" accounting firm shall be automatically
deemed satisfactory to the Agent Bank), which report shall be prepared in
accordance with generally accepted auditing standards as at such date, and shall
not be subject to any qualifications or exceptions as to the scope of the audit
nor to any other qualification or exception determined by the Requisite Lenders
in their good faith business judgment to be adverse to the interests of the
Banks. Such accountants' report shall be accompanied by a certificate stating
that, in making the examination pursuant to generally accepted auditing
standards necessary for the certification of such financial statements and such
report, such accountants have
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obtained no knowledge of any Default or, if, in the opinion of such accountants,
any such Default shall exist, stating the nature and status of such Default, and
stating that such accountants have reviewed the Financial Covenants as at the
end of such Fiscal Year (which shall accompany such certificate) under Sections
6.01 through 6.07, have read such Sections (including the definitions of all
defined terms used therein) and that nothing has come to the attention of such
accountants in the course of such examination that would cause them to believe
that the same were not calculated by the Borrower Consolidation in the manner
prescribed by this Credit Agreement. Such financial statements shall be
certified by an Authorized Officer of the Borrower Consolidation in the same
manner as required with respect to financial statements delivered pursuant to
Section 5.08(a);
d. As soon as practicable, and in any event no later than fifteen (15)
days prior to the commencement of each Fiscal Year, a budget (including a
Capital Expenditure budget) and projection by Fiscal Quarter for that Fiscal
Year and by Fiscal Year for the next four (4) succeeding Fiscal Years, INCLUDING
for the first such Fiscal Year, projected consolidated and consolidating balance
sheets, statements of operations and statements of cash flow and, for the second
(2nd) and third (3rd) such Fiscal Years, projected consolidated and
consolidating condensed balance sheets and statements of operations and cash
flows, of the Borrower Consolidation, all in reasonable detail;
e. Concurrently with the financial statements and reports required
pursuant to Sections 5.08(a) and 5.08(c), Compliance Certificate signed by an
Authorized Officer;
f. Promptly after the same are available, copies of each annual report,
proxy or financial statement or other report or communication that shall have
been sent to the stockholders of MTRI, and copies of all annual, regular,
periodic and special reports (including, without limitation, each 10Q and 10K
report) and registration statements which MTRI shall have filed or be required
to file with the Securities and Exchange Commission under Section 13 or 15(d) of
the Securities Exchange Act of 1934, as amended, and not otherwise required to
be delivered to the Banks pursuant to other provisions of this Section 5.08.
g. Until Credit Facility Termination, Borrowers, and each of them,
shall keep and maintain complete and accurate books and records in accordance
with GAAP, consistently applied. Subject to compliance with all applicable
Gaming Laws and the Securities and Exchange Act of 1934, as amended, Borrowers,
and each of
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them, shall permit Banks and any authorized representatives of Banks to have
reasonable access to and to inspect, examine and make copies of the books and
records, any and all accounts, data and other documents of Borrowers at all
reasonable times upon the giving of reasonable notice of such intent. In
addition: (i) in the event of the occurrence of any Default or Event of Default,
or (ii) in the event any Material Adverse Change occurs, Borrowers shall
promptly, and in any event within three (3) days after actual knowledge thereof,
notify Agent Bank in writing of such occurrence; and
h. Until Credit Facility Termination, Borrowers, and each of them,
shall furnish to Agent Bank, with sufficient copies for distribution to each of
the Banks, any financial information or other information bearing on the
financial status of the Borrowers, or any of them, which is reasonably requested
by Agent Bank or Requisite Lenders.
Section 5.09. INSURANCE. Until Credit Facility Termination, Borrowers shall
obtain, or cause to be obtained, and shall maintain or cause to be maintained
with respect to the Collateral, at their own cost and expense, and shall deposit
with Agent Bank on or before the Closing Date:
a. PROPERTY INSURANCE. Borrowers shall maintain a special causes of
loss ("All Risk" - ISO form or equivalent), perils policy covering the buildings
and improvements, and any other permanent structures for one hundred percent
(100%) of the replacement cost. Borrowers shall maintain a Ten Million Dollar
($10,000,000.00) limit of coverage for the perils of flood and earthquake
covering the Collateral. Upon the request of Agent Bank, replacement cost for
insurance purposes will be established by an independent appraiser mutually
selected by Borrowers and Agent Bank. The policy will include Agreed Amount
(waiving co-insurance), replacement cost valuation and building ordinance
endorsements. The policy will include a standard mortgagee clause (ISO form or
equivalent, i.e. Borrower's acts will not impair mortgagee's right to recover,
exclusive payment of loss to mortgagee and automatic notice of cancellation or
non-renewal to mortgagee) and provide that all losses in excess of Two Hundred
Thousand Dollars ($200,000.00) be adjusted with the Agent Bank. The Borrowers
waive any and all rights of subrogation against Banks resulting from losses to
property.
b. PERSONAL PROPERTY (INCLUDING MACHINERY, EQUIPMENT, FURNITURE,
FIXTURES, STOCK). Borrowers shall maintain a special causes of loss ("All Risk")
perils property coverage for all personal property owned, leased or for which
Borrowers are
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legally liable. The coverage will include a lenders' loss payable endorsement in
favor of Agent Bank.
The policy providing real property and personal property coverages, as
specified in 5.09(a) and (b) hereinabove, may include a deductible of no more
than Twenty-Five Thousand Dollars ($25,000.00) for any single occurrence. Flood
and earthquake deductibles can be no more than Two Hundred Fifty Thousand
Dollars ($250,000.00), if a separate deductible applies.
c. BUSINESS INTERRUPTION/EXTRA EXPENSE. Borrowers shall maintain
combined Business Interruption/Extra Expense coverage for the Hotel/Casino
Facilities with a limit representing no less than eighty percent (80%) of the
net profit plus continuing expenses (including debt service) for the race track,
hotel and casino facilities (including all video lottery/slot operations). Such
coverage shall include an extensions for off premises power losses at One
Million Dollars ($1,000,000.00) and extended period of indemnity of one hundred
eighty (180) days endorsement. These coverages may have deductible of no greater
than twenty-four (24) hours, or Twenty-Five Thousand ($25,000.00), if a separate
deductible applies. This coverage will be specifically endorsed to include Agent
Bank as loss payee.
d. BOILER AND MACHINERY. Borrowers shall maintain a Boiler and
Machinery policy for the Casino Facilities written on a Comprehensive Form with
a combined direct and indirect limit of no less than Ten Million Dollars
($10,000,000.00). The policy shall include extensions for Agreed Amount (waiving
co-insurance) and Replacement Cost Valuation. The policy may contain deductibles
of no greater than Ten Thousand Dollars ($10,000.00) direct and twenty-four (24)
hours indirect.
e. CRIME INSURANCE. Borrowers shall obtain a comprehensive crime
policy, including the following coverages:
(i) employee dishonesty - One Million Dollars ($1,000,000.00);
(ii) money and securities (inside) - Five Hundred Thousand Dollars
($500,000.00);
(iii) money and securities (outside) - Five Hundred Thousand Dollars
($500,000.00);
(iv) depositor's forgery - One Million Dollars ($1,000,000.00);
(v) computer fraud - One Million Dollars ($1,000,000.00).
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The policy must be amended so that money is defined to include "tokens
and chips" (as defined in Regulation 12.010 of the Nevada Gaming Authorities).
The policy may contain deductibles of no greater than Twenty-Five Thousand
Dollars ($25,000,000.00) for all coverages listed above.
f. COMMERCIAL GENERAL LIABILITY (1998 FORM OR EQUIVALENT). Borrowers
shall maintain a Commercial General Liability policy with a One Million Dollar
($1,000,000.00) combined single limit for bodily injury and property damage,
including Products Liability, Contractual Liability, and all standard policy
form extensions. The policy must provide a Two Million Dollar ($2,000,000.00)
general aggregate (per location, if multi-location risk) and be written on an
"occurrence form". The policy will also include extensions for Liquor Legal
Liability, Employee Benefits Legal Liability, Innkeepers Legal and Safe Deposit
Legal coverages and Spectator Liability coverages (if necessary, a separate
policy can be secured for Spectator Liability). If the general liability policy
contains a self-insured retention, it shall be no greater than Ten Thousand
Dollars ($10,000.00) per occurrence, with an aggregate retention of no more than
Two Hundred Fifty Thousand Dollars ($250,000.00), including expenses.
The policy shall be endorsed to include Agent Bank as an additional
insured on behalf of the Banks. Definition of additional insured shall include
all officers, directors, employees, agents and representatives of the additional
insured. The coverage for additional insured shall apply on a primary basis
irrespective of any other insurance whether collectible or not (ISO Form
#CG20261185 Additional Insured Designated Person or Organization, or
Equivalent).
g. CARE, CUSTODY AND CONTROL LIABILITY. Borrowers shall maintain a
care, custody and control liability policy with a single limit of no less than
One Hundred Thousand Dollars ($100,000.00) (each horse)/One Million Dollars
($1,000,000.00) (in the aggregate) per occurrence for any injury, damage or
death to horses in the care, custody and control of the Borrowers. The Agent
Bank shall be included as an additional insured under such policy.
h. AUTOMOBILE. Borrowers shall maintain a comprehensive Automobile
Liability Insurance Policy written under coverage "symbol 1", providing a One
Million Dollar ($1,000,000.00) combined single limit for bodily injury and
property damage covering all owned, non-owned and hired vehicles of the
Borrowers. If the policy contains a self insured retention it shall be no
greater than Ten Thousand Dollars ($10,000.00) per occurrence with an aggregate
retention of no more than Two Hundred Fifty Thousand Dollars ($250,000.00),
including expenses. The following additional coverages must be purchased by
Borrowers:
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(i) GARAGE LIABILITY. A One Million Dollar ($1,000,000.00)
combined single limit for bodily and property damage for the garage
operation.
(ii) GARAGEKEEPERS LEGAL LIABILITY. Five Hundred Thousand
Dollar ($500,000.00) limit for comprehensive and collision coverages
for physical damage to vehicles in the Borrowers' care, custody and
control. The policy can be subject to a deductible of no greater than
Two Thousand Five Hundred Dollars ($2,500.00) for each auto and Ten
Thousand Dollars ($10,000.00) for each loss.
i. WORKERS COMPENSATION AND EMPLOYERS LIABILITY INSURANCE. Borrowers
shall maintain a standard workers compensation policy covering the states of
Nevada, West Virginia (as West Virginia is a monopolistic state coverage must be
secured through the state fund) and any other state where the company is
operating, including employers liability coverage subject to a limit of no less
than One Million Dollars ($1,000,000.00) each employee, One Million Dollars
($1,000,000.00) each accident, One Million Dollars ($1,000,000.00) policy limit.
The policy shall include endorsements for Voluntary Compensation, Stop Gap
Liability, Long-Shoreman's and Harbors Workmans Compensation Act and Maritime
Coverages (as applicable). If the Borrowers have elected to self-insure Workers
Compensation coverage in the State of Nevada (or any other state), the Agent
Bank must be furnished with a copy of the certificate from the state(s)
permitting self-insurance and evidence of a Stop Loss Excess Workers
Compensation policy with a specific retention of no greater than One Hundred
Fifty Thousand Dollars ($150,000.00) per occurrence.
j. If Borrowers' general liability and automobile policies include a
self-insured retention, it is agreed and fully understood that Borrowers are
solely responsible for payment of all amounts due within said self-insured
retentions. Any Indemnification/Hold Harmless provision is extended to cover all
liabilities associated with said self-insured retentions.
k. UMBRELLA LIABILITY. An Umbrella Liability policy shall be purchased
with a limit of not less than Fifty Million Dollars ($50,000,000.00) providing
excess coverage over all limits and coverages indicated in paragraphs (f), (h)
and (i) above. The limits can be obtained by a combination of Primary and Excess
Umbrella policies, provided that all layers follow form with the underlying
policies indicated in (f), (h) and (i) are written on an "occurrence" form. This
policy shall be endorsed to include the Agent Bank as an additional insured on
behalf of the Banks, in the same manner set forth in Section 5.09(f)
hereinabove.
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l. KEY MAN LIFE INSURANCE. The Borrower Consolidation shall maintain
key-man life insurance on the life of Arneault in an aggregate amount of no less
than Eight Million Dollars ($8,000,000.00). Each such key man life insurance
policy or policies shall designate MTRI as the beneficiary thereof and shall
provide that written notice shall be given to Agent Bank no less than thirty
(30) days prior to any cancellation or termination thereof.
m. All policies indicated above shall be written with insurance
companies licensed and admitted to do business in all states where the Borrower
Consolidation, or any of them, is operating and shall be rated no lower than "A
XII" in the most recent addition of A.M. Best's and "AA" in the most recent
edition of Standard & Poor's, or such other carrier reasonably acceptable to
Agent Bank. All policies discussed above shall be endorsed to provide that in
the event of a cancellation, non-renewal or material modification, Agent Bank
shall receive thirty (30) days prior written notice thereof. The Borrowers shall
furnish Agent Bank with Certificates of Insurance executed by an authorized
agent evidencing compliance with all insurance provisions discussed above on an
annual basis. The Borrowers shall also furnish actual policy endorsements
evidencing appropriate status of Agent Bank (as mortgagee, loss payee and
additional insured). Certificates of Insurance executed by an authorized agent
of each carrier providing insurance evidencing continuation of all coverages
will be provided on the Closing Date and annually on or before ten (10) days
prior to the expiration of each policy. All certificates and other notices
related to the insurance program shall be delivered to Agent Bank concurrently
with the delivery of such certificates or notices to such carrier or to
Borrowers, or any of them, as applicable.
n. Any other insurance reasonably requested by Agent Bank or Requisite
Lenders in such amount and covering such risks as may be reasonably required and
customary in the race track hotel/casino industry in the general location of the
Hotel/Casino Facilities. Approval of any insurance by Agent Bank shall not be a
representation of solvency of any insurer or sufficiency of any coverage
required under this Credit Agreement. All requirements are considered minimum in
terms of the purchase and maintenance of insurance under this Credit Agreement.
Section 5.10. TAXES. Throughout the term of the Credit Facility, Borrowers
shall prepare and timely file or cause to be prepared and timely filed all
federal, state and local tax returns required to be filed by it, and Borrowers
shall pay and discharge prior to delinquency all taxes, assessments and other
governmental charges or levies imposed upon it, or in respect of any of any of
its properties and assets except such taxes, assessments and other governmental
charges or levies, if any, as are being
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contested in good faith by Borrowers in the manner which is set forth for such
contests by Section 4.07 herein.
Section 5.11. PERMITTED ENCUMBRANCES ONLY. At all times throughout the term
of the Credit Facility, Borrowers shall not create, incur, assume or suffer to
exist any mortgage, deed of trust, pledge, lien, security interest, encumbrance,
attachment, levy, distraint, or other judicial process and burdens of every kind
and nature except the Permitted Encumbrances on or with respect to the
Collateral, except (a) with respect to matters described in Sections 5.03 and
5.10 such items as are being contested in the manner described therein, and (b)
with respect to any other items, if any, as are being contested in good faith by
appropriate proceedings and for which Borrowers have maintained adequate
reserves for the payment thereof.
Section 5.12. ADVANCES. At any time during the term of the Credit Facility,
if Borrowers should fail (a) to perform or observe, or (b) to cause to be
performed or observed, any covenant or obligation of Borrowers under this Credit
Agreement or any of the other Loan Documents, then Agent Bank, upon the giving
of reasonable notice may (but shall be under no obligation to) take such steps
as are necessary to remedy any such non-performance or non-observance and
provide for payment thereof. All amounts advanced by Agent Bank or Lenders
pursuant to this Section 5.12 shall become an additional obligation of Borrowers
to Lenders secured by the Deeds of Trust and other Loan Documents, shall reduce
the amount of Available Borrowings and shall become due and payable by Borrowers
on the next interest payment date, together with interest thereon at a rate per
annum equal to the Default Rate (such interest to be calculated from the date of
such advancement to the date of payment thereof by Borrowers).
Section 5.13. FURTHER ASSURANCES. Borrowers will do, execute, acknowledge
and deliver, or cause to be done, executed, acknowledged and delivered, such
amendments or supplements hereto or to any of the Loan Documents and such
further documents, instruments and transfers as Requisite Lender or Agent Bank
may reasonably require for the curing of any defect in the execution or
acknowledgement hereof or in any of the Loan Documents, or in the description of
the Collateral Properties or other Collateral or for the proper evidencing of
giving notice of each lien or security interest securing repayment of the Credit
Facility. Further, upon the execution and delivery of the Deeds of Trust and
each of the Loan Documents and thereafter, from time to time, Borrowers shall
cause the Deeds of Trust and each of the Loan Documents and each amendment and
supplement thereto to be filed, registered and recorded and to be refiled,
re-registered and re-recorded in such manner and in such places as may be
reasonably required by the Requisite Lenders or Agent Bank, in order
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to publish notice of and fully protect the liens of the Deeds of Trust and the
Loan Documents and to protect or continue to perfect the security interests
created by the Deeds of Trust and Loan Documents in the Collateral Properties
and Collateral and to perform or cause to be performed from time to time any
other actions required by law and execute or cause to be executed any and all
instruments of further assurance that may be necessary for such publication,
perfection, continuation and protection.
Section 5.14. INDEMNIFICATION. Borrowers agree to and do hereby jointly and
severally indemnify, protect, defend and save harmless Agent Bank and each of
the Banks and their respective trustees, officers, employees, agents, attorneys
and shareholders (individually an "Indemnified Party" and collectively the
"Indemnified Parties") from and against any and all losses, damages, expenses or
liabilities of any kind or nature from any suits, claims, or demands, including
reasonable counsel fees incurred in investigating or defending such claim,
suffered by any of them and caused by, relating to, arising out of, resulting
from, or in any way connected with this Credit Agreement, with any other Loan
Document or with the transactions contemplated herein and thereby; provided,
however, Borrowers shall not be obligated to indemnify, protect, defend or save
harmless an Indemnified Party if, and to the extent, the loss, damage, expense
or liability was caused by (a) the gross negligence or intentional misconduct of
such Indemnified Party, or (b) the breach of this Credit Agreement or any other
Loan Document by such Indemnified Party or the breach of any laws, rules or
regulation by such Indemnified Party (other than those breaches of laws arising
from any Borrowers' default). In case any action shall be brought against any
Indemnified Party based upon any of the above and in respect to which indemnity
may be sought against Borrowers, Agent Bank shall promptly notify Borrowers in
writing, and Borrowers shall assume the defense thereof, including the
employment of counsel selected by Borrowers and reasonably satisfactory to
Indemnified Party, the payment of all costs and expenses and the right to
negotiate and consent to settlement upon the consent of the Indemnified Party.
Upon reasonable determination made by Indemnified Party that such counsel would
have a conflict representing such Indemnified Party and Borrowers, the
applicable Indemnified Party shall have the right to employ separate counsel in
any such action and to participate in the defense thereof. Borrowers shall not
be liable for any settlement of any such action effected without their consent,
but if settled with Borrowers' consent, or if there be a final judgment for the
claimant in any such action, Borrowers agree to indemnify, defend and save
harmless such Indemnified Parties from and against any loss or liability by
reason of such settlement or judgment. The provisions of this Section 5.14 shall
survive the termination of this Credit Agreement and the repayment of the Credit
Facility and the assignment or subparticipation of all or any portion of the
Syndication Interest held by any Lender pursuant to Section 11.10.
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Section 5.15. INSPECTION OF THE COLLATERAL AND APPRAISAL. At all
times during the term of the Credit Facility and subject to compliance with
all applicable Gaming Laws, Borrowers shall provide or cause to be provided
to Banks and any authorized representatives of Banks, accompanied by
representatives of Borrowers, the reasonable right of entry and free access
to the Collateral Properties to inspect same on reasonable prior notice to
Borrowers. Provided, however, Lenders shall use commercially reasonable
efforts to avoid undue interference with Borrowers' business operations. If
at any time any Qualified Appraisal of the Collateral Properties, or any of
them, is required to be made by any banking regulatory authority or
determined to be necessary by Agent Bank or Requisite Lenders after the
occurrence of an Event of Default, Borrowers agree to pay all fees, costs and
expenses incurred by Agent Bank in connection with the preparation of such
Qualified Appraisal.
Section 5.16. COMPLIANCE WITH OTHER LOAN DOCUMENTS. Borrowers
shall comply with each and every term, condition and agreement contained in
the Loan Documents including, without limitation, the Environmental
Certificate and all of the Security Documentation.
Section 5.17. SUITS OR ACTIONS AFFECTING BORROWERS. Throughout
the term of the Credit Facility, Borrowers shall promptly advise Agent Bank
in writing within ten (10) days after Borrowers obtain knowledge of (a) any
claims, litigation, proceedings or disputes (whether or not purportedly on
behalf of Borrowers) against, or to the actual knowledge of Borrowers,
threatened or affecting Borrowers which, if adversely determined, would
result in a Material Adverse Change in the Collateral Properties or the
business, operations or financial conditions of Borrowers, (b) any material
labor controversy resulting in or threatening to result in a strike against
any of the Collateral Properties or Hotel/Casino Facilities, or (c) any
proposal by any Governmental Authority to acquire any of the material assets
or business of Borrowers.
Section 5.18. CONSENTS OF AND NOTICE TO GAMING AUTHORITIES.
a. On or before the Closing Date, Borrowers shall make all
necessary applications to and procure all necessary consents and approvals of
the applicable Gaming Authorities to the: (i) pledge of the stock of MPI,
SGLVI and SGRI pursuant to the Stock Pledges, (ii) the restrictions on
transfer and hypothecation of the stock of MPI, SGLVI and SGRI contained in
Sections 6.12(a) and 7.01(s), and (iii) the terms set forth in the Credit
Agreement and each of the Loan Documents, to the extent which may be required
by the West Virginia Gaming Authorities; and
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b. Borrowers shall comply in all material respects with all
applicable statutes, rules and regulations requiring reports and disclosures
to all applicable Gaming Authorities, including, but not limited to,
reporting this Credit Facility transaction, within the time period required
by Regulation 8.130(2) of the Regulations of Nevada Gaming Commission and
State Gaming Control Board and as may be required by the West Virginia Gaming
Authorities.
Section 5.19. TRADENAMES, TRADEMARKS AND SERVICEMARKS. Borrowers
shall not assign or in any other manner alienate their respective interests
in any material tradenames, trademarks or servicemarks relating or pertaining
to the Hotel/Casino Facilities during the term of the Credit Facility. No
Borrower shall change its name without first giving at least thirty (30) days
prior written notice to Agent Bank.
Section 5.20. NOTICE OF HAZARDOUS MATERIALS. Within ten (10) days
after an executive officer of any of the Borrowers shall have obtained actual
knowledge thereof, Borrowers shall promptly advise Agent Bank and each of the
Lenders in writing of and deliver a copy of: (a) any and all enforcement,
clean-up, removal or other governmental or regulatory actions instituted or
threatened by any Governmental Agency pursuant to any applicable federal,
state or local laws, ordinances or regulations relating to any Hazardous
Materials (as defined in the Environmental Certificate) affecting the
Collateral Properties ("Hazardous Materials Laws"); (b) all written claims
made or threatened by any third party against Borrowers, the Collateral
Properties, the Hotel/Casino Facilities, or any of them, relating to damage,
contribution, cost recovery compensation, loss or injury resulting from any
Hazardous Materials (the matters set forth in clauses (a) and (b) above are
hereinafter referred to as "Hazardous Materials Claims"); and (c) the
discovery of any occurrence or condition on any real property adjoining or in
the vicinity of the Collateral Properties, the Hotel/Casino Facilities, or
any of them, that could cause any Borrower or any part thereof to be held
liable under the provisions of, or to be otherwise subject to any
restrictions on the ownership, occupancy, transferability or use of the
Collateral Properties or the Hotel/Casino Facilities under, any Hazardous
Materials Laws.
Section 5.21. COMPLIANCE WITH ACCESS LAWS.
a. Borrowers agree that Borrowers, the Hotel/Casino Facilities
and the Collateral Properties shall at all times strictly comply with the
requirements of the Americans with Disabilities Act of 1990; the Fair Housing
Amendments Act of 1988; and other federal, state or local laws or ordinances
related to disabled access; or any statute, rule, regulation, ordinance,
order of Governmental Authorities, or order or
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decree of any court adopted or enacted with respect thereto, as now existing
or hereafter amended or adopted (collectively, the "Access Laws"), as may be
applicable to the respective Hotel/Casino Facilities. At any time, Agent Bank
may require a certificate of compliance with the Access Laws and
indemnification agreement in a form reasonably acceptable to Agent Bank.
Agent Bank may also require a certificate of compliance with the Access Laws
from an architect, engineer, or other third party acceptable to Agent Bank.
b. Notwithstanding any provisions set forth herein or in any
other document, Borrowers shall not alter or permit any tenant or other
person to alter the Hotel/Casino Facilities or the Collateral Properties in
any manner which would increase Borrowers' responsibilities for compliance
with the Access Laws without the prior written approval of Agent Bank. In
connection with such approval, Agent Bank may require a certificate of
compliance with the Access Laws from an architect, engineer or other person
acceptable to Agent Bank.
c. Borrowers agree to give prompt written notice to Agent Bank
of the receipt by Borrowers of any claims of violation of any of the Access
Laws and of the commencement of any proceedings or investigations which
relate to compliance with any of the Access Laws.
d. Borrowers shall indemnify, defend and hold harmless
Indemnified Parties from and against any and all claims, demands, damages,
costs, expenses, losses, liabilities, penalties, fines and other proceedings
including, without limitation, reasonable attorneys' fees and expenses
arising directly or indirectly from or out of or in any way connected with
any failure of the Hotel/Casino Facilities or the Collateral Properties to
comply with any of the Access Laws as the same may have been applicable
during the term of the Credit Facility. The obligations and liabilities of
Borrowers under this section shall survive Credit Facility Termination, any
satisfaction, assignment, judicial or nonjudicial foreclosure proceeding, or
delivery of a deed in lieu of foreclosure.
Section 5.22. COMPLIANCE WITH WOODVIEW LOAN DOCUMENTS AND LOGAN
LOAN DOCUMENTS.
a. Until Credit Facility Termination, Borrowers shall fully
perform and comply with or cause to be performed and complied with all of the
respective material covenants, material terms and material conditions imposed
or assumed by
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them, or any of them, under each of the Woodview Loan Documents. Borrowers
shall not amend, modify or terminate, or enter into any agreement to amend,
modify or terminate any of the Woodview Loan Documents without the prior
written consent of Requisite Lenders.
b. Upon occurrence of the Logan Primary Parcel Closing, and
until Credit Facility Termination, Borrowers shall fully perform and comply
with or cause to be performed and complied with all of the respective
material covenants, material terms and material conditions imposed or assumed
by them, or any of them, under each of the Logan Loan Documents. Borrowers
shall not amend, modify or terminate, or enter into any agreement to amend,
modify or terminate any of the Logan Loan Documents without the prior written
consent of Requisite Lenders.
Section 5.23. KEY MAN LIFE INSURANCE. In the event of the death
of Arneault prior to Credit Facility Termination, Borrowers shall cause a
Voluntary Permanent Reduction to be made to the Credit Facility in the amount
of Four Million Dollars ($4,000,000.00), which Voluntary Permanent Reduction
shall be made on or before the earlier to occur of (a) receipt by MTRI of the
proceeds of the key man life insurance required to be maintained by the
Borrower Consolidation under Section 5.09; or (b) one hundred twenty (120)
days following the death of Arneault.
Section 5.24. INTEREST RATE PROTECTION. Commencing no later than
ninety (90) days following the Closing Date and continuing for a period of no
less than three (3) years following the date of such commencement, Borrowers
shall maintain Interest Rate Hedges which are first approved in writing by
Agent Bank, which approval shall not be unreasonably withheld or delayed, in
an aggregate principal notional amount of no less than fifty percent (50.0%)
of the total of all Indebtedness owing by the Borrower Consolidation
(exclusive of Contingent Liabilities) outstanding from time to time.
ARTICLE VI
FINANCIAL COVENANTS
Until payment in full of all sums owing hereunder and under the
Revolving Credit Note and the occurrence of Credit Facility Termination,
Borrowers agree, as set forth below, to comply or cause compliance with the
following Financial Covenants.
Section 6.01. LEVERAGE RATIO. Commencing as of the first Fiscal
Quarter ending subsequent to the Closing Date and continuing as of each
Fiscal
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Quarter end until Credit Facility Termination, the Borrower Consolidation
shall maintain a Leverage Ratio no greater than the ratios described
hereinbelow to be calculated as of the end of each Fiscal Quarter in
accordance with the following schedule:
<TABLE>
<CAPTION>
MAXIMUM
FISCAL QUARTER END LEVERAGE RATIO
------------------ --------------
<S> <C>
As of the Closing Date and as of each
Fiscal Quarter end through the Fiscal
Quarter ending March 31, 2001 2.5 to 1.00
As of the Fiscal Quarter ending June 30,
2001, and as of each Fiscal Quarter end
through the Fiscal Quarter ending March 31,
2002 2.0 to 1.00
As of the Fiscal Quarter ending June 30,
2002, and as of each Fiscal Quarter end
through Credit Facility Termination 1.5 to 1.00
</TABLE>
Section 6.02. ADJUSTED FIXED CHARGE COVERAGE RATIO. Commencing as
of the first Fiscal Quarter ending subsequent to the Closing Date and
continuing as of each Fiscal Quarter end until Credit Facility Termination,
the Borrower Consolidation shall maintain an Adjusted Fixed Charge Coverage
Ratio no less than 2.00 to 1.00.
Section 6.03. MINIMUM TANGIBLE NET WORTH. The Borrower
Consolidation shall maintain as of the last day of each Fiscal Quarter a
Tangible Net Worth equal to or greater than the sum of (a) ninety percent
(90%) of the Tangible Net Worth of the Borrower Consolidation calculated as
of the end of the most recently ended Fiscal Quarter prior to the Closing
Date, plus (b) eighty-five percent (85.0%) of Net Income after taxes realized
by the Borrower Consolidation as of each Fiscal Quarter end occurring on and
after the Closing Date, without deduction for any net losses, plus (c) ninety
percent (90.0%) of the Net Proceeds received by the Borrower Consolidation
all Equity Offerings made subsequent to the Closing Date.
Section 6.04. LIMITATION ON INDEBTEDNESS. The Borrower
Consolidation shall not owe or incur any Indebtedness, except as specifically
permitted hereinbelow:
a. Funded Outstandings under the Credit Facility;
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b. Interest Rate Hedges up to the aggregate notional amount of
Sixty Million Dollars ($60,000,000.00);
c. Indebtedness owing by Borrowers as of the Closing Date;
d. Secured purchase money Indebtedness and Capital Lease
Liabilities relating to FF&E used and to be used in connection with the
Hotel/Casino Facilities up to the maximum aggregate principal amount of
Thirteen Million Dollars ($13,000,000.00) at any time outstanding;
e. Unsecured trade payable incurred in the ordinary course of
business less than one hundred twenty (120) days past due; and
f. Indebtedness evidenced by the Logan Loan Documents.
Section 6.05. RESTRICTION ON DISTRIBUTIONS. No member of the
Borrower Consolidation shall make any Distributions, other than: (a)
Distributions to other members of the Borrower Consolidation, (b)
Distributions made in connection with Insider Cash Loans and Insider Non-Cash
Loans, (c) Share Repurchases to the extent permitted by Section 6.08(i).
Section 6.06. CAPITAL EXPENDITURE REQUIREMENTS.
a. During each Fiscal Year, commencing with the Fiscal Year
commencing January 1, 2000, Borrowers shall make or cause to be made,
Maintenance Capital Expenditures to the Hotel/Casino Facilities in a minimum
aggregate amount equal to or greater than two percent (2%) of net revenues
("Minimum Maintenance Cap Ex Requirement") derived from the Hotel/Casino
Facilities by the Borrower Consolidation during the immediately preceding
Fiscal Year, but in no event greater than a maximum aggregate amount equal to
six percent (6%) of net revenues ("Maximum Maintenance Cap Ex Limit") derived
from the Hotel/Casino Facilities by the Borrower Consolidation during the
immediately preceding Fiscal Year.
b. In no event shall the Borrower Consolidation make Expansion
Capital Expenditures greater than the cumulative maximum aggregate amount of
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Fifty-One Million Dollars ($51,000,000.00) during the period commencing on
the Closing Date and ending as of Credit Facility Termination.
Section 6.07. CONTINGENT LIABILITY(IES). The Borrower
Consolidation shall not directly or indirectly incur any Contingent
Liability(ies) without the prior written consent of Requisite Lenders. In no
event shall any Contingent Liabilities be secured by a Lien on any property
or assets of any member of the Borrower Consolidation.
Section 6.08. INVESTMENT RESTRICTIONS. Other than Investments
permitted hereinbelow or approved in writing by Requisite Lenders, the
Borrower Consolidation shall not make any Investments (whether by way of
loan, stock purchase, capital contribution, or otherwise) other than the
following:
a. Cash, Cash Equivalents and direct obligations of the United
States Government;
b. Prime commercial paper (AA rated or better);
c. Certificates of Deposit or Repurchase Agreement issued by a
commercial bank having capital surplus in excess of One Hundred Million
Dollars ($100,000,000.00);
d. Money market or other funds of nationally recognized
institutions investing solely in obligations described in (a), (b) and (c)
above;
e. Insider Cash Loans not exceeding One Million Five Hundred
Thousand Dollars ($1,500,000.00) in the aggregate during any Fiscal Year,
provided that each of such Insider Cash Loans shall bear interest at a rate
no less than the Prime Rate plus one percent (1.0%) per annum and shall in
each instance be fully due and payable on or before one (1) year from the
date such Insider Cash Loan is advanced by any member of the Borrower
Consolidation;
f. Insider Non-Cash Loans;
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g. Advances under the terms of the SABAL Loan;
h. Capital Expenditures to the extent permitted under
Section 6.06;
i. Share Repurchases up to the maximum cumulative aggregate
amount of Three Million Dollars ($3,000,000.00) during the period commencing
on December 20, 1999 and ending at Credit Facility Termination; and
j. New Venture Investments no greater than the cumulative
maximum aggregate amount of Fifteen Million Dollars ($15,000,000.00) through
Credit Facility Termination, so long as:
(i) no New Venture Investments shall be made prior to
the first annual anniversary of the Closing Date;
(ii) in each instance the New Venture or interest in the
New Venture acquired by such New Venture Investment be concurrently
pledged as additional Collateral securing the Bank Facilities; and
(iii) no Default or Event of Default shall have occurred
and remains continuing.
Section 6.09. TOTAL LIENS. The Borrower Consolidation shall not
directly or indirectly, create, incur, assume or permit to exist any Lien on
or with respect to any of the Collateral, whether now owned or hereafter
acquired, or any income or profits therefrom, or file or permit the filing
of, or permit to remain in effect, any financing statement or other similar
notice of any Lien with respect to any of the Collateral under the Uniform
Commercial Code of any State or under any similar recording or notice
statute, except:
a. Permitted Encumbrances;
b. Liens granted or permitted pursuant to the Security
Documentation;
c. Liens on the FF&E and other goods securing Indebtedness to
finance the purchase price thereof; PROVIDED that (i) such Liens shall extend
only to the equipment and other goods so financed and the proceeds thereof,
(ii) such Liens shall
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not secure Indebtedness in excess of Thirteen Million Dollars
($13,000,000.00) in the aggregate at any time, and (iii) Agent Bank, upon the
written request of an Authorized Officer, shall confirm the priority of such
Liens as paramount to the Security Documentation to the extent such Liens are
permitted under this Section 6.10(c).
Section 6.10. NO CHANGE OF CONTROL. Until the occurrence of
Credit Facility Termination, no Change of Control shall occur.
Section 6.11. CONSOLIDATION, MERGER, SALE OF ASSETS, ETC. Other
than as approved in writing by Requisite Lenders, no member of the Borrower
Consolidation shall wind up, liquidate or dissolve its affairs or enter into
any transaction of merger or consolidation (except a merger or consolidation
with another entity within the Borrower Consolidation), or convey, sell,
lease or otherwise dispose of (or make an agreement to do any of the
foregoing at any time prior to Credit Facility Termination) all or any
material part of its respective property or assets (except to another entity
within the Borrower Consolidation), except that the following shall be
permitted: (i) the Borrowers may make sales of inventory and other assets in
the ordinary course of business, and (ii) so long as no Default or Event of
Default shall have occurred and remains continuing the Borrowers may, in the
ordinary course of business, sell equipment and FF&E as provided in Section
5.01.
Section 6.12. NO TRANSFER OF OWNERSHIP; EQUITY OFFERINGS.
a. MTRI shall not transfer or hypothecate its ownership
interests in MPI, SGLVI or SGRI except in connection with the Security
Documentation.
b. MTRI shall not make any Equity Offering, unless one hundred
percent (100%) of the Net Proceeds received by the Borrower Consolidation in
connection with such Equity Offering are used to make a Voluntary Permanent
Reduction in the amount of such Net Proceeds promptly following receipt
thereof.
Section 6.13. ERISA. No Borrower shall:
a. At any time, permit any Pension Plan which is maintained by
any Borrower or to which any Borrower is obligated to contribute on behalf of
its employees, in such case if to do so would constitute a Material Adverse
Change, to:
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(i) engage in any non-exempt "prohibited transaction",
as such term is defined in Section 4975 of the Code;
(ii) incur any material "accumulated funding deficiency",
as that term is defined in Section 302 of ERISA; or
(iii) suffer a termination event to occur which may
reasonably be expected to result in liability of any Borrower to
the Pension Plan or to the Pension Benefit Guaranty Corporation
or the imposition of a lien on the Collateral pursuant to
Section 4068 of ERISA.
b. Fail, upon any Borrower becoming aware thereof, promptly to
notify the Agent Bank of the occurrence of any Reportable Event with respect
to any Pension Plan or of any non-exempt "prohibited transaction" (as defined
in Section 4975 of the Code) with respect to any Pension Plan which is
maintained by any Borrower or to which Borrowers are obligated to contribute
on behalf of their employees or any trust created thereunder which Reportable
Event or prohibited transaction would constitute a Material Adverse Change.
c. At any time, permit any Pension Plan which is maintained by
any Borrower or to which any Borrower is obligated to contribute on behalf of
its employees to fail to comply with ERISA or other applicable laws in any
respect that would result in a Material Adverse Change.
Section 6.14. MARGIN REGULATIONS. No part of the proceeds of the
Credit Facility will be used by Borrowers to purchase or carry any Margin
Stock or to extend credit to others for the purpose of purchasing or carrying
any Margin Stock. Neither the making of such loans, nor the use of the
proceeds of such loans will violate or be inconsistent with the provisions of
Regulations G, T, U or X of the Board of Governors of the Federal Reserve
System.
Section 6.15. TRANSACTIONS WITH AFFILIATES. No Borrower shall
engage in any transaction with any Affiliate of Borrowers which is not a
member of the Borrower Consolidation, other than arms length transactions for
fair market value, except to the extent more favorable to the Borrower
Consolidation.
Section 6.16. LIMITATION ON SUBSIDIARIES. No member of the
Borrower Consolidation shall create any Subsidiaries (other than subsidiaries
which are members of the Borrower Consolidation) without the prior written
consent of Requisite Lenders.
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In the event of Requisite Lenders consent to the creation of any Subsidiary,
such Subsidiary shall execute a Subsidiary Guaranty promptly following its
creation.
Section 6.17. LIMITATION ON CONSOLIDATED TAX LIABILITY. No
member of the Borrower Consolidation shall be liable for federal income taxes
relating to the taxable income of any Subsidiary or Affiliate of MTRI which
is not a member of the Borrower Consolidation, or any of them, in excess of
the amount of federal income taxes it would pay if reporting as a separate
entity, unless such member of the Borrower Consolidation is fully reimbursed
by such Subsidiary or Affiliate of MTRI on or before the payment of such
taxes.
Section 6.18. CHANGE IN ACCOUNTING PRINCIPLES. Except as
otherwise provided herein, if any changes in accounting principles from those
used in the preparation of the most recent financial statements delivered to
Agent Bank pursuant to the terms hereof are hereinafter required or permitted
by the rules, regulations, pronouncements and opinions of the Financial
Accounting Standards Board or the American Institute of Certified Public
Accountants (or successors thereto or agencies with similar functions) and
are adopted by the Borrowers with the agreement of their independent
certified public accountants and such changes result in a change in the
method of calculation of any of the financial covenants, standards or terms
found herein, the parties hereto agree to enter into negotiations in order to
amend such provisions so as to equitably reflect such changes with the
desired result that the criteria for evaluating the financial condition of
Borrowers shall be the same after such changes as if such changes had not
been made; provided, however, that no change in GAAP that would affect the
method of calculation of any of the financial covenants, standards or terms
shall be given effect in such calculations until such provisions are amended,
in a manner satisfactory to Agent Bank and Requisite Lenders, to so reflect
such change in accounting principles.
ARTICLE VII
EVENTS OF DEFAULT
Section 7.01. EVENTS OF DEFAULT. Any of the following events and
the passage of any applicable notice and cure periods shall constitute an
Event of Default hereunder:
a. Any representation or warranty made by Borrowers pursuant
to or in connection with this Credit Agreement, the Revolving Credit Note,
the Environmental Certificate, or any other Loan Document or in any report,
certificate,
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financial statement or other writing furnished by Borrowers in connection
herewith, shall prove to be false, incorrect or misleading in any materially
adverse aspect as of the date when made;
b. Borrowers shall have defaulted in the payment of any
principal or interest on the Revolving Credit Note when due, and such default
continues for a period of more than five (5) days;
c. Borrowers shall have defaulted under the terms of any other
obligation owing Agent Bank under the terms of this Credit Agreement, which
default continues beyond any applicable grace period therein contained;
d. Borrowers shall have defaulted in the payment of any late
charge, Nonusage Fees, expenses, indemnities or any other amount owing under
any Loan Document or under the Fee Side Letter for a period of five (5) days
after notice thereof to Borrowers from Agent Bank;
e. Borrowers shall fail duly and punctually to perform or
comply with: (i) any term, covenant, condition or promise contained in
Sections 6.01, 6.02, 6.03, 6.04, 6.05, 6.06, 6.07, 6.08, 6.09 or 6.10, or
(ii) any other term, covenant, condition or promise contained in this Credit
Agreement, the Revolving Credit Note, the Deeds of Trust or any other Loan
Document and, in the case of any term, covenant, condition or promise covered
by this clause (ii), such failure shall continue thirty (30) days after
written notice thereof is delivered to Borrowers by Agent Bank or any Lender
of such failure;
f. Any of the Security Documentation or any provision thereof:
(i) shall cease to be in full force and effect in any material respect and
such cessation results in a Material Adverse Change, or (ii) shall cease to
give the Agent Bank in any material respect the liens, rights, powers and
privileges purported to be created thereby, or (iii) the Borrowers shall
default in the due performance or observance of any term, covenant or
agreement on their part to be performed or observed pursuant to the Security
Documentation for a period of thirty (30) days after written notice thereof
is delivered to Borrowers by Agent Bank of such failure (or such shorter
period following such notice as may be specifically required in any Loan
Document), provided, however, that in the event the cure for such Event of
Default reasonably requires more than thirty (30) days, the cure period shall
be extended for an additional period so long as
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Borrowers diligently and promptly undertake such cure and in no event shall
the default remain uncured for a period in excess of ninety (90) days
following such written notice;
g. Any Borrower shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect
to it or its debts under the Bankruptcy Code or any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official, for all
or substantially all of its property, or shall consent to any such relief or
to the appointment or taking possession by any such official in any
involuntary case or other proceeding against it;
h. An involuntary case or other proceeding shall be commenced
against any Borrower seeking liquidation, reorganization or other relief with
respect to itself or its debts under the Bankruptcy Code or any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official, for all or substantially all of its property, and such involuntary
case or other proceeding shall remain undismissed and unstayed for a period
of ninety (90) days;
i. Any Borrower makes an assignment for the benefit of its
creditors or admits in writing its inability to pay its debts generally as
they become due;
j. Borrowers shall fail to make any payment when due (whether
by scheduled maturity, required prepayment, offer to purchase, redemption,
acceleration, demand or otherwise, in each case beyond the grace period
provided with respect to such Indebtedness) on the Indebtedness evidenced by
the Woodview Loan Documents or on any other Indebtedness, if the aggregate
amount of such Indebtedness is Two Million Five Hundred Thousand Dollars
($2,500,000.00), or more, or any breach, default or event of default shall
occur, or any other event shall occur or condition shall exist, under any
instrument, agreement or indenture pertaining thereto if the effect thereof
is to accelerate, the maturity of any such Indebtedness; or any such
Indebtedness shall be declared to be due and payable or shall be required to
be prepaid, purchased or redeemed (other than by a regularly scheduled
required prepayment) prior to the stated maturity thereof, or the holder of
any lien in any amount, shall commence foreclosure of such lien upon property
of Borrowers having a value in excess of One Million Dollars ($1,000,000.00)
and such foreclosure shall continue against such property to a date less than
thirty (30) days prior to the date of the proposed foreclosure sale;
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k. The occurrence of any event of default, beyond any
applicable grace period, under the terms of any agreement with any Lender in
connection with a Secured Interest Rate Hedge relating to the Credit Facility;
l. Any Borrower shall be voluntarily or involuntarily divested
of title or possession of any Collateral Property or shall lease or in any
other manner, voluntarily or involuntarily alienate any of its interest in
any Collateral Property or any portion of the Hotel/Casino Facilities, other
than the Permitted Encumbrances and as permitted in Section 5.01 or other
than within the Borrower Consolidation;
m. The occurrence of any Reportable Event with respect to a
Pension Plan which Agent Bank determines in good faith constitutes proper
grounds for the termination of any Pension Plan by the Pension Benefit
Guaranty Corporation or for the appointment by an appropriate United States
District Court of a trustee to administer any such plan that would result in
a Material Adverse Change, should occur and should continue for thirty (30)
days after written notice of such determination shall have been given to
Borrowers by Agent Bank;
n. Commencement against any Borrower, any time after the
execution of this Credit Agreement, of any litigation which is not stayed,
bonded, dismissed, terminated or disposed of to the satisfaction of Agent
Bank within ninety (90) days after its commencement, and which (i) has a
reasonable probability of success, and could, if successful, in the
reasonable opinion of Agent Bank, materially and adversely affect the
priority of the Liens granted Agent Bank by the Deeds of Trust in the
Collateral Properties, or (ii) results in the issuance of a preliminary or
permanent injunction which is not dissolved or stayed pending appeal within
sixty (60) days of its issuance and which preliminary or permanent injunction
materially adversely affects any Borrowers' right to use the Collateral
Properties as the Hotel/Casino Facilities;
o. The loss or suspension, other than on account of forces
majeure, of any Borrower's unrestricted Gaming Permits or the failure of any
Borrower to maintain gaming activities at the Hotel/Casino Facilities other
than on account of forces majeure at least to the same general extent as is
presently conducted thereon for a period in excess of thirty (30) consecutive
days;
p. Any money judgment, writ or warrant of attachment or
similar process involving (i) in any individual case an amount in excess of
One Million Dollars ($1,000,000.00) or (ii) in the aggregate at any time an
amount in excess of Two Million
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Dollars ($2,000,000.00) (in either case not adequately covered by insurance
as to which a solvent and unaffiliated insurance company has acknowledged
coverage) shall be entered or filed against any Borrower or any of their
respective assets and shall remain undischarged, unvacated, unbonded or
unstayed for a period of sixty (60) days (or in any event later than five (5)
days prior to the date of any proposed sale thereunder);
q. Any order, judgment or decree shall be entered against any
Borrower decreeing its involuntary dissolution or split up and such order
shall remain undischarged and unstayed for a period in excess of thirty (30)
days, or Borrowers shall otherwise dissolve or cease to exist;
r. The occurrence of any Change of Control;
s. MTRI sells, transfers, assigns, hypothecates or otherwise
alienates its interest in all or any portion of the common voting stock of
MPI, SGLVI or SGRI, other than in connection with the Stock Pledges;
t. The occurrence of any default under any Subsidiary Guaranty
delivered to Agent Bank or the revocation, termination or repudiation of such
Subsidiary Guaranty by any Subsidiary prior to Credit Facility Termination; or
u. The occurrence of any Material Adverse Change.
Section 7.02. DEFAULT REMEDIES. Upon the occurrence of any Event
of Default, Agent Bank, upon the consent or direction of Requisite Lenders,
shall declare the unpaid balance of the Revolving Credit Note, together with
the interest thereon, to be fully due and payable, and Agent Bank shall, upon
the consent or direction of Requisite Lenders, exercise any or all of the
following remedies:
a. Terminate the obligation of Lenders to make any advances
for Borrowings and may declare all outstanding unpaid Indebtedness hereunder
and under the Revolving Credit Note and other Loan Documents together with
all accrued interest thereon immediately due and payable without
presentation, demand, protest or notice of any kind. This remedy will be
deemed to have been automatically exercised on the occurrence of any event
set out in Sections 7.01 (g), (h) or (i).
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b. The Banks and/or Agent Bank may exercise any and all
remedies available to Banks or Agent Bank under the Loan Documents.
c. In the event Borrowers have failed to provide any insurance
required under Section 5.09 after the lapse of all applicable notice and cure
periods, Agent Bank may elect at its discretion to purchase such insurance.
All payments made by Agent Bank for the purpose of providing the insurance
coverages required under Section 5.09 shall be deemed amounts advanced under
Section 5.12 of this Credit Agreement.
d. The Banks and/or Agent Bank may exercise any other remedies
available to Banks or Agent Bank at law or in equity, including requesting
the appointment of a receiver to perform any acts required of Borrowers under
this Credit Agreement, and Borrowers hereby specifically consent to any such
request by Banks.
For the purpose of carrying out this section and exercising these
rights, powers and privileges and subject to all applicable Gaming Laws,
Borrowers hereby irrevocably constitute and appoint Agent Bank as their true
and lawful attorney-in-fact to execute, acknowledge and deliver any
instruments and do and perform any acts such as are referred to in this
paragraph in the name and on behalf of Borrowers. Agent Bank on behalf of
Lenders may exercise one or more of Lenders' remedies simultaneously and all
its remedies are nonexclusive and cumulative. Agent Bank and Lenders shall
not be required to pursue or exhaust any Collateral or remedy before pursuing
any other Collateral or remedy. Agent Bank and Lenders' failure to exercise
any remedy for a particular default shall not be deemed a waiver of (i) such
remedy, nor their rights to exercise any other remedy for that default, nor
(ii) their right to exercise that remedy for any subsequent default.
Section 7.03. APPLICATION OF PROCEEDS. All payments and proceeds
received and all amounts held or realized from the sale or other disposition
of the Collateral Properties and/or Collateral, which are to be applied
hereunder towards satisfaction of Borrowers' obligations under the Credit
Facility, shall be applied in the following order of priority:
a. First, to the payment of all reasonable fees, costs and
expenses (including reasonable attorney's fees and expenses) incurred by
Agent Bank and Banks, their agents or representatives in connection with the
realization upon any of the Collateral;
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b. Next, to the payment in full of any other amounts due under
this Credit Agreement, the Deeds of Trust, or any other Loan Documents (other
than the Revolving Credit Note);
c. Next, to the balance of interest remaining unpaid on the
Revolving Credit Note;
d. Next, to the balance of principal remaining unpaid on the
Revolving Credit Note;
e. Next, the balance, if any, of such payments or proceeds to
whomever may be legally entitled thereto.
Section 7.04. NOTICES. In order to entitle Agent Bank and/or
Banks to exercise any remedy available hereunder, it shall not be necessary
for Agent Bank and/or Banks to give any notice, other than such notice as may
be required expressly herein or by applicable law.
Section 7.05. AGREEMENT TO PAY ATTORNEY'S FEES AND EXPENSES.
Subject to the provisions of Section 11.14, upon the occurrence of an Event
of Default, as a result of which Agent Bank shall require and employ
attorneys or incur other expenses for the collection of payments due or to
become due or the enforcement or performance or observance of any obligation
or agreement on the part of Borrowers contained herein, Borrowers shall, on
demand, pay to Agent Bank the reasonable fees of such attorneys and such
other reasonable expenses so incurred by Agent Bank.
Section 7.06. NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER. In the
event any agreement contained in this Credit Agreement should be breached by
either party and thereafter waived by the other party, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive
any other breach hereunder.
Section 7.07. LICENSING OF AGENT BANK AND LENDERS. In the event
of the occurrence of an Event of Default hereunder or under any of the Loan
Documents and it shall become necessary, or in the opinion of Requisite
Lenders advisable, for an agent, supervisor, receiver or other representative
of Agent Bank and Banks to become licensed under the provisions of the laws
and/or regulations of any Gaming Authority as
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a condition to receiving the benefit of any Collateral encumbered by the
Deeds of Trust or other Loan Documents for the benefit of Lenders or
otherwise to enforce their rights hereunder, Borrowers hereby give their
consent to the granting of such license or licenses and agree to execute such
further documents as may be required in connection with the evidencing of
such consent.
Section 7.08. EXERCISE OF RIGHTS SUBJECT TO APPLICABLE LAW. All
rights, remedies and powers provided by this Article VII may be exercised
only to the extent that the exercise thereof does not violate any applicable
provision of the laws of any Governmental Authority and all of the provisions
of this Article VII are intended to be subject to all applicable mandatory
provisions of law that may be controlling and to be limited to the extent
necessary so that they will not render this Credit Agreement invalid,
unenforceable or not entitled to be recorded or filed under the provisions of
any applicable law.
Section 7.09. DISCONTINUANCE OF PROCEEDINGS. In case Agent Bank
and/or Banks shall have proceeded to enforce any right, power or remedy under
this Credit Agreement, the Revolving Credit Note, the Deeds of Trust or any
other Loan Document by foreclosure, entry or otherwise, and such proceedings
shall have been discontinued or abandoned for any reason or shall have been
determined adversely to Banks, then and in every such case Borrowers, Agent
Bank and/or Banks shall be restored to their former positions and rights
hereunder with respect to the Collateral, and all rights, remedies and powers
of Agent Bank and Banks shall continue as if such proceedings had not been
taken, subject to any binding rule by the applicable court or other tribunal
in any such proceeding.
ARTICLE VIII
DAMAGE, DESTRUCTION AND CONDEMNATION
Section 8.01. NO ABATEMENT OF PAYMENTS. If all or any part of
the Collateral Properties shall be materially damaged or destroyed, or if
title to or the temporary use of the whole or any part of any of the
Collateral Properties shall be taken or condemned by a competent authority
for any public use or purpose, there shall be no abatement or reduction in
the amounts payable by Borrowers hereunder or under the Revolving Credit
Note, and Borrowers shall continue to be obligated to make such payments.
Section 8.02. DISTRIBUTION OF CAPITAL PROCEEDS UPON OCCURRENCE OF
FIRE, OTHER PERILS OR CONDEMNATION. All monies received from "All Risk"
including flood
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and earthquake insurance policies covering any of the Collateral Properties
or from condemnation or similar actions in regard to said Collateral
Properties, shall be paid directly to Agent Bank. However, in the event the
amount paid to Agent Bank is equal to or less than One Million Dollars
($1,000,000.00), such amount shall be paid directly to Borrowers unless an
Event of Default (other than non-monetary Events of Default occurring as a
direct consequence of such casualty loss or condemnation) shall have occurred
and then be continuing. In the event the amount paid to Agent Bank is greater
than One Million Dollars ($1,000,000.00), then at the option of Borrowers,
unless an Event of Default (other than non-monetary Events of Default
occurring as a direct consequence of such casualty loss or condemnation) has
occurred hereunder and is then continuing, in which case at the option of
Requisite Lenders, such amount may be applied to pay the outstanding balance
of the Credit Facility or the entire amount so collected, or any part
thereof, may be released to Borrowers for repair or replacement of the
property destroyed or condemned or to reimburse Borrowers for the costs of
such repair or replacement incurred prior to the date of such release. In the
event the amount so collected is applied to reduce the outstanding balance of
the Credit Facility as a consequence of an existing Event of Default, such
reduction shall be made as a Voluntary Permanent Reduction. In the event the
Borrowers elect to, or Lenders are required to, release all or a portion of
the collected funds to Borrowers for such repair or replacement of the
property destroyed or condemned, such release of funds shall be made in
accordance with the following terms and conditions:
a. The repairs, replacements and rebuilding shall be made in
accordance with plans and specifications approved by Requisite Lenders and in
accordance with all applicable laws, ordinances, rules, regulations and
requirements of Governmental Authorities;
b. Borrowers shall provide Agent Bank with a detailed estimate
of the costs of such repairs or restorations;
c. Borrowers shall satisfy the Requisite Lenders that after
the reconstruction is completed, the value of the Collateral Properties, as
determined by the Requisite Lenders in their reasonable discretion, will not
be less than the value of the Collateral Properties prior to such destruction
or condemnation as determined by the Requisite Lenders pursuant to this
Credit Agreement;
d. In the Requisite Lenders' sole reasonable opinion, any
undisbursed portion of the Available Borrowings contemplated hereunder, after
deposit of such proceeds, is sufficient to pay all costs of reconstruction of
the Hotel/Casino
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Facility or other Collateral Property damaged, destroyed or condemned; or if
the undisbursed portion of such Credit Facility is not sufficient, Borrowers
shall deposit additional funds with the Agent Bank, sufficient to pay such
additional costs of reconstructing the Collateral Property;
e. Borrowers have delivered to the Agent Bank a construction
contract for the work of reconstruction in form and content, including
insurance requirements, acceptable to the Requisite Lenders with a contractor
acceptable to the Requisite Lenders;
f. The Requisite Lenders in their reasonable discretion have
determined that after the work of reconstruction is completed, the
Hotel/Casino Facilities or Collateral Property damaged, destroyed or
condemned will produce income sufficient to pay all costs of operations and
maintenance of the applicable Collateral Property with a reasonable reserve
for repairs, and service all debts secured by the applicable Collateral
Property;
g. No Default or Event of Default has occurred and is
continuing hereunder;
h. Borrowers have deposited with the Agent Bank that amount
reasonably determined by the Requisite Lenders (taking into consideration the
amount of Borrowings available and the amount of proceeds, if any, of
insurance policies covering property damage and business interruption, loss
or rental income in connection with the Hotel/Casino Facility or Collateral
Property damaged, destroyed or condemned accruing and immediately forthcoming
to the Agent Bank) to be sufficient to service no less than seventy-five
percent (75.0%) of the Indebtedness secured hereby during the period of
reconstruction, as reasonably estimated by the Requisite Lenders;
i. Before commencing any such work, Borrowers shall, at their
own cost and expense, furnish Agent Bank with appropriate endorsements, if
needed, to the "All Risk" insurance policy which Borrowers are then presently
maintaining, and course of construction insurance to cover all of the risks
during the course of such work;
j. Such work shall be commenced by Borrowers within one
hundred twenty (120) days after (i) settlement shall have been made with the
insurance companies or condemnation proceeds shall have been received, and
(ii) all the necessary governmental approvals shall have been obtained, and
such work shall be
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completed within a reasonable time, free and clear of all liens and
encumbrances so as not to interfere with the lien of the Deeds of Trust;
k. Disbursements of such insurance or condemnation proceeds
shall be made in the customary manner used by Agent Bank for the disbursement
of construction loans; and
l. That in the event the insurance or condemnation proceeds
are inadequate to repair or replace the property destroyed or condemned and
Requisite Lenders elect to, or are required to release all or a portion of
the funds collected for such repair or replacement, Borrowers agree to
deposit with Agent Bank sufficient funds to cover the difference between the
costs of repair or replacement and the funds released by Requisite Lenders to
Borrowers for such repair or replacement of the property destroyed.
ARTICLE IX
AGENCY PROVISIONS
Section 9.01. APPOINTMENT.
a. Each Lender hereby (i) designates and appoints WFB as the
Agent Bank of such Lender under this Credit Agreement and the Loan Documents,
(ii) authorizes and directs Agent Bank to enter into the Loan Documents other
than this Credit Agreement for the benefit of Lenders, and (iii) authorizes
Agent Bank to take such action on its behalf under the provisions of this
Credit Agreement and the Loan Documents and to exercise such powers as are
set forth herein or therein, together with such other powers as are
reasonably incidental thereto, subject to the limitations referred to in
Sections 9.10(a) and 9.10(b). Agent Bank agrees to act as such on the express
conditions contained in this Article IX.
b. The provisions of this Article IX are solely for the
benefit of Agent Bank and Lenders, and Borrowers shall not have any rights to
rely on or enforce any of the provisions hereof (other than as set forth in
the provisions of Sections 9.03, 9.09 and 10.10), provided, however, that the
foregoing shall in no way limit Borrowers' obligations under this Article IX.
In performing its functions and duties under this Credit Agreement, Agent
Bank shall act solely as Agent Bank of Lenders and does not assume and shall
not be deemed to have assumed any obligation toward or relationship of agency
or trust with or for Borrowers or any other Person.
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