UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): July 15, 1997
AMERISTAR CASINOS, INC.
(Exact name of registrant as specified in its charter)
Nevada 0-22494 88-0304799
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation or Number)
organization)
3773 Howard Hughes Parkway
Suite 490 South
Las Vegas, Nevada 89109
(Address of principal executive offices and Zip Code)
(702) 567-7000
(Registrant's telephone number, including area code)
<PAGE>ITEM 5. OTHER EVENTS.
REFINANCING OF LONG-TERM DEBT. On July 24, 1997, Ameristar
Casinos, Inc. ("Ameristar") issued a press release announcing
that it has refinanced its long-term debt through a new
$125 million revolving bank credit facility (the "Revolving
Credit Facility") and the sale of $100 million aggregate
principal amount of 10-1/2% Senior Subordinated Notes due 2004
Series A (the "Senior Subordinated Notes").
The Revolving Credit Facility was entered into on July 8,
1997, pursuant to a Credit Agreement among Ameristar and its four
principal wholly owned subsidiaries (the "Borrowers"), a
syndicate of bank lenders and Wells Fargo Bank, National
Association ("WFB") as Agent Bank, Arranger and Swingline Lender.
The Borrowers made an initial draw of $114.5 million under the
Revolving Credit Facility on July 15, 1997, which was used to
repay $94.5 million in borrowings outstanding under Ameristar's
prior revolving credit facility (the "1995 Revolving Credit
Facility") and a $20.0 million short-term loan from WFB.
The Senior Subordinated Notes were issued by Ameristar at
par in a private placement to certain initial purchasers for
resale to qualified institutional buyers pursuant to the
exemption provided by Rule 144A of the Securities and Exchange
Commission. The net proceeds from the sale of the Senior
Subordinated Notes were used to repay $82.4 million in borrowings
and interest under the Revolving Credit Facility, $13.1 million
in other indebtedness and $800,000 in loan fees for the Revolving
Credit Facility. Following the application of the net proceeds
from the sale of the Senior Subordinated Notes, the outstanding
principal balance of the Revolving Credit Facility was
$32.6 million.
THE REVOLVING CREDIT FACILITY. In addition to Ameristar,
the Borrowers under the Revolving Credit Facility include:
Cactus Pete's Inc. ("CPI"), which owns and operates Cactus Petes
Resort Casino and The Horseshu Hotel & Casino, in Jackpot,
Nevada; Ameristar Casino Vicksburg, Inc. ("ACVI"), which owns and
operates Ameristar Casino Vicksburg in Vicksburg, Mississippi;
Ameristar Casino Council Bluffs, Inc. ("ACCBI"), which owns and
operates Ameristar Casino Hotel Council Bluffs, in Council
Bluffs, Iowa; and Ameristar Casino Las Vegas, Inc. ("ACLVI"),
which owns and is developing The Reserve Hotel & Casino in
Henderson, Nevada ("The Reserve").
Until Phase I of The Reserve is completed, additional draws
under the Revolving Credit Facility may be used only for the
construction of The Reserve, the acquisition of additional land
for the development of The Reserve currently under option and the
replenishment of working capital used to fund $4.0 million in
payments due in June 1997 related to the acquisition of The
Reserve and certain expenses incurred in connection with the
Revolving Credit Facility. Draws for construction of The Reserve
will be subject to the satisfaction of various conditions
typically applicable to construction loans. Following completion
of Phase I of The Reserve, Revolving Credit Facility proceeds may
be used only for working capital purposes of the Borrowers and
funding ongoing capital expenditures for existing facilities,
including construction of Phase II of The Reserve and the
acquisition of additional land under option adjacent to The
Reserve site.
<PAGE>Borrowings under the Revolving Credit Facility will be
designated by the Borrowers on a quarterly basis as either base
rate or London Interbank Offered Rate ("LIBOR") borrowings. The
interest rate generally will be equal to WFB's per annum prime
rate in effect from time to time or the per annum LIBOR rate,
plus in each case an applicable margin determined by reference to
the Borrowers' rolling four-quarter ratio of total funded debt to
EBITDA (as defined below). The range of the base rate margin is
from 0.25 percentage points to 2.25 percentage points, and the
range of the LIBOR margin is from 1.50 percentage points to 3.50
percentage points.
The Revolving Credit Facility will mature on June 30, 2003.
Prior to maturity, the maximum principal available under the
Revolving Credit Facility will reduce semiannually (commencing on
July 1, 1999) by an aggregate of $50.0 million in increasing
increments ranging from $2.5 million to $10.0 million. The
Borrowers may prepay any borrowings under the Revolving Credit
Facility without penalty (subject to certain charges applicable
to the prepayment of LIBOR draws prior to the end of the
applicable interest period) so long as a minimum of $10.0 million
in borrowings is repaid. The Borrowers may also optionally
reduce the maximum principal available under the Revolving Credit
Facility at any time so long as any such reduction is for a
minimum of $10.0 million. The Revolving Credit Facility includes
covenants and conditions that limit the Borrowers' outstanding
borrowings under the Revolving Credit Facility to not more than
the lesser of the Borrowers' rolling four-quarter EBITDA
multiplied by 3.25 and the Borrowers' total funded debt to not
more than the Borrowers' rolling four-quarter EBITDA multiplied
initially by 5.0, which multiplier will decline to 4.5 commencing
March 31, 1999 and to 4.0 commencing March 31, 2000. For
purposes of the Revolving Credit Facility, the Borrowers' EBITDA
is generally defined as net income before interest expense,
income taxes, depreciation and amortization, preopening costs and
certain extraordinary and non-cash items.
The Revolving Credit Facility also includes covenants
requiring the Borrowers to maintain rolling four-quarter gross
fixed charge coverage and adjusted fixed charge coverage ratios
of 1.5 to 1.0 and 1.1 to 1.0, respectively. The gross fixed
charge coverage ratio is generally defined as EBITDA divided by
the aggregate sum of interest expense actually paid and current
capitalized lease obligations plus required principal reductions
on funded debt. The adjusted fixed charge coverage ratio is
generally defined as the aggregate sum of EBITDA minus income
taxes minus distributions to stockholders (other than to another
Borrower) minus repurchases of Ameristar Common Stock divided by
the aggregate sum of interest expense actually paid and current
capitalized lease obligations plus required principal reductions
on funded, debt. For purposes of these covenants, principal
payments on the $28.7 million promissory notes issued to the
former stockholders of Gem Gaming, Inc. in connection with the
acquisition of The Reserve (the "Gem Notes") will be included
only to the extent actually paid in the applicable period. The
Revolving Credit Facility prohibits Ameristar from making any
dividend or other distribution on its capital stock during any
period in which the Borrowers' rolling four-quarter ratio of
total funded debt to EBITDA is greater than 2.0 to 1.0.
<PAGE>The Revolving Credit Facility is secured by liens on
substantially all of the real and personal property of the
Borrowers. The Revolving Credit Facility prohibits any future
secondary liens on these properties without the prior written
approval of the lenders. Certain changes in control of Ameristar
may constitute a default under the Revolving Credit Facility.
The Revolving Credit Facility also requires the Borrowers to
expend two percent of their consolidated revenues on capital
maintenance annually. The Revolving Credit Facility binds the
Borrowers to a number of additional affirmative and negative
covenants, including promises to maintain certain financial
ratios and tests within defined parameters.
Following the completion of Phase I of The Reserve, the
Revolving Credit Facility also provides for WFB to make certain
swingline loans to the Borrowers generally to provide short-term
financing pending the funding of a draw by the lenders under the
Revolving Credit Facility. Such swingline loans will bear
interest based on WFB's prime rate determined from time to time
in the same manner as for other borrowings under the Revolving
Credit Facility.
The Borrowers paid various fees and other loan costs upon
the closing of the Revolving Credit Facility that will be
amortized over the term of the Revolving Credit Facility. In
addition, commencing on the first anniversary of the closing of
the Revolving Credit Facility, the Borrowers will be required to
pay quarterly commitment fees at an annual rate of 0.50% (subject
to reduction to 0.375% if the Borrowers' ratio of total funded
debt to rolling four-quarter EBITDA is less than 2.00 to 1.00) of
the unused portion of the Revolving Credit Facility.
The 1995 Revolving Credit Facility was terminated early in
connection with entering into the Revolving Credit Facility. As
a result, Ameristar will incur a $1.0 million pre-tax non-cash
extraordinary charge ($637,000 or $0.03 per share on an after-tax
basis) during the 1997 third quarter to reflect the accelerated
write-off of unamortized deferred financing costs.
THE SENIOR SUBORDINATED NOTES. The Senior Subordinated
Notes were issued under an Indenture dated July 15, 1997 (the
"Indenture"), under which the Trustee is First Trust National
Association. In addition to Ameristar and the Trustee, certain
of Ameristar's subsidiaries (the "Guarantors") are parties to the
Indenture for the purpose of guaranteeing (the "Guarantees")
payments on the Senior Subordinated Notes. The Guarantors
include ACVI, ACCBI, ACLVI, A.C. Food Services, Inc. (a food
purchasing concern) and AC Hotel Corp. (which will own and
develop a 149-room hotel at Ameristar Vicksburg). ACCBI's
obligations under its Guarantee were subject to the approval of
the Iowa Racing and Gaming Commission, which was obtained on
July 24, 1997. CPI is currently a Restricted Subsidiary (as
defined) and will become a Guarantor pursuant to a Supplemental
Indenture subject to the prior approval of the Nevada Gaming
Commission, for which an application has been submitted. Future
Restricted Subsidiaries will be required to become Guarantors.
The Senior Subordinated Notes will mature on August 1, 2004.
Interest is payable semiannually on February 1 and August 1,
commencing February 1, 1998, at the per annum rate of 10.5%. The
Senior Subordinated Notes and the Guarantees are not secured and
are subordinate to all existing and future Senior Indebtedness
(as defined), which includes the Revolving Credit Facility.
<PAGE>Ameristar may redeem the Senior Subordinated Notes, in
whole or in part, at any time on or after August 1, 2001, at
redemption prices that decline over time from 105.25% to 101.75%.
Senior Subordinated Notes may also be redeemed if the holder or
beneficial owner thereof is required to be licensed, qualified or
found suitable under applicable Gaming Laws (as defined) and is
not so licensed, qualified or found suitable. Ameristar may also
be required to redeem a portion of the Senior Subordinated Notes
in the event of certain asset sales or the loss of a material
gaming license, and each holder of the Senior Subordinated Notes
will have the right to require Ameristar to redeem such holder's
Senior Subordinated Notes upon a Change of Control (as defined)
of Ameristar. The Senior Subordinated Notes are not subject to
any mandatory redemption or sinking fund obligations.
The Indenture includes covenants that restrict the ability
of Ameristar and the Restricted Subsidiaries from incurring
future Indebtedness (as defined); provided, however, that
Ameristar or any Guarantor may incur Indebtedness if the
incurrence thereof would not result in the Consolidated Coverage
Ratio (as defined) to be greater than 2.0 to 1.0. The
Consolidated Coverage Ratio is defined generally as the ratio of
the consolidated cash flow (measured by an EBITDA formula) to
consolidated interest and other fixed charges of Ameristar and
its Restricted Subsidiaries on a rolling four-quarter basis. The
Indenture also permits Ameristar or a Restricted Subsidiary to
incur Indebtedness without regard to the Consolidated Coverage
Ratio test in certain circumstances, including borrowings of up
to $140 million under the Revolving Credit Facility, as amended
or replaced from time to time, up to $15.0 million in recourse
FF&E financings, up to $7.5 million in borrowings for the
construction of the hotel at Ameristar Vicksburg and up to
$5.0 million of other Indebtedness.
The Indenture also includes certain covenants that, among
other things, limit the ability of Ameristar and its Restricted
Subsidiaries to pay dividends or other distributions, make
investments, repurchase subordinated obligations or capital
stock, create certain liens (except those securing Senior
Indebtedness), enter into certain transactions with affiliates,
sell assets, issue or sell subsidiary stock, create or permit
restrictions on distributions from subsidiaries or enter into
certain mergers and consolidations.
Pursuant to a Registration Rights Agreement among Ameristar,
its subsidiaries and the initial purchasers of the Senior
Subordinated Notes, Ameristar and its subsidiaries have agreed to
file by September 15, 1997, a registration statement under the
Securities Act of 1933 with respect to an offer to exchange the
Senior Subordinated Notes for debt securities with terms
identical to the Senior Subordinated Notes (except for provisions
relating to transfer restrictions, registration rights and
liquidated damages) and use their best efforts to cause the
exchange offer thereunder to be consummated by January 12, 1998.
In certain circumstances, Ameristar and its subsidiaries have
agreed to file a shelf registration statement for resales of the
Senior Subordinated Notes by the holders thereof. If the
registration obligations are not satisfied, Ameristar will be
required to pay liquidated damages to the holders of the Senior
Subordinated Notes under certain circumstances.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) and (b) Financial Statements and Pro Forma Financial
Information.
None.
(c) Exhibits.
4.1 Credit Agreement, dated as of July 8, 1997, among
Ameristar Casinos, Inc., Cactus Pete's Inc.,
Ameristar Casino Vicksburg, Inc., Ameristar Casino
Council Bluffs, Inc. and Ameristar Casino Las
Vegas, Inc., as Borrowers, the Lenders named
therein, and Wells Fargo Bank, National
Association as Arranger, Agent Bank and Swingline
Lender. See also Exhibit 99.1
4.2 Indenture, dated as of July 15, 1997, among
Ameristar Casinos, Inc., Ameristar Casino Las
Vegas, Inc., Ameristar Casino Vicksburg, Inc.,
A.C. Food Services, Inc., AC Hotel Corp.,
Ameristar Casino Council Bluffs, Inc. and First
Trust National Association.
4.3 Registration Rights Agreement, dated as of
July 15, 1997, among Ameristar Casinos, Inc.,
Ameristar Casino Council Bluffs, Inc., A.C. Food
Services, Inc., AC Hotel Corp., Ameristar Casino
Las Vegas, Inc., Ameristar Casino Vicksburg, Inc.,
Cactus Pete's, Inc., Bear, Stearns & Co. Inc., BT
Securities Corporation and First Chicago Capital
Markets, Inc.
20.1 Press Release of Ameristar Casinos, Inc. dated
July 24, 1997.
99.1 Supplemental Agreement to furnish the Securities
and Exchange Commission omitted exhibits and
schedules to Exhibit 4.1.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the undersigned registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
AMERISTAR CASINOS, INC.
(Registrant)
Date: July 29, 1997
By: /s/ Thomas M. Steinbauer
Thomas M. Steinbauer,
Senior Vice President and
Chief Financial Officer
<PAGE>EXHIBIT INDEX
Exhibit
Number Description of Exhibit Method of Filing
4.1 Credit Agreement, dated as of Filed electronically
July 8, 1997, among Ameristar herewith.
Casinos, Inc., Cactus Pete's
Inc., Ameristar Casino
Vicksburg, Inc., Ameristar
Casino Council Bluffs, Inc. and
Ameristar Casino Las Vegas,
Inc., as Borrowers, the Lenders
named therein, and Wells Fargo
Bank, National Association as
Arranger, Agent Bank and
Swingline Lender. See also
Exhibit 99.1
4.2 Indenture, dated as of July 15, Filed electronically
1997, among Ameristar Casinos, herewith.
Inc., Ameristar Casino Las
Vegas, Inc., Ameristar Casino
Vicksburg, Inc., A.C. Food
Services, Inc., AC Hotel Corp.,
Ameristar Casino Council
Bluffs, Inc. and First Trust
National Association.
4.3 Registration Rights Agreement, Filed electronically
dated as of July 15, 1997, herewith.
among Ameristar Casinos, Inc.,
Ameristar Casino Council
Bluffs, Inc., A.C. Food
Services, Inc., AC Hotel Corp.,
Ameristar Casino Las Vegas,
Inc., Ameristar Casino
Vicksburg, Inc., Cactus Pete's,
Inc., Bear, Stearns & Co. Inc.,
BT Securities Corporation and
First Chicago Capital Markets,
Inc.
20.1 Press Release of Ameristar Filed electronically
Casinos, Inc. dated July 24, herewith.
1997.
99.1 Supplemental Agreement to Filed electronically
furnish the Securities and herewith.
Exchange Commission omitted
exhibits and schedules to
Exhibit 4.1.
CREDIT AGREEMENT
THIS CREDIT AGREEMENT ("Credit Agreement") is made
and entered into as of the 8th day of July, 1997, by and
among AMERISTAR CASINOS, INC., a Nevada corporation ("ACI"),
CACTUS PETE'S, INC., a Nevada corporation ("CPI"), AMERISTAR
CASINO VICKSBURG, INC., a Mississippi corporation ("ACVI"),
AMERISTAR CASINO COUNCIL BLUFFS, INC., an Iowa corporation
("ACCBI") and AMERISTAR CASINO LAS VEGAS, INC., a Nevada
corporation ("ACLVI" and together with ACI, CPI, ACVI and
ACCBI, collectively referred to as the "Borrowers"), each of
the Lenders, as hereinafter defined, WELLS FARGO BANK,
National Association, as the swingline lender (herein in
such capacity, together with its successors and assigns, the
"Swingline Lender") 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. CPI, ACVI, ACCBI and ACLVI are wholly owned
subsidiaries of ACI. On or about June 1, 1995, ACI, as
borrower, and CPI, ACVI and ACCBI, as guarantors, entered
into a Credit Agreement, dated June 1, 1995 (the "Existing
Credit Agreement") with certain banks, as lenders, described
in the Existing Credit Agreement (each individually an
"Existing Lender" and collectively the "Existing Lenders")
under the terms of which Existing Lenders established a
reducing revolving line of credit in favor of ACI, as
borrower, and CPI, ACVI and ACCBI, as guarantors, in the
amount of One Hundred Five Million Dollars ($105,000,000.00)
(the "Existing Bank Loan") as evidenced by a Promissory Note
due December 31, 2001 (the "Existing Note") executed by ACI
and payable to the order of the Existing Lenders.
<PAGE> C. Pursuant to the terms of the Merger Agreement
dated May 30, 1996 (as amended, the "GEM Merger Agreement")
executed by and among Gem Gaming, Inc., ACI, ACLVI, Steven
W. Rebeil ("Rebeil") and Dominic J. Magliarditi
("Magliarditi"), Gem Gaming, Inc. was merged with and into
ACLVI (the "Gem Merger"). As a consequence of the Gem
Merger ACLVI is the owner of the ACLVI Real Property and the
ACLVI Project.
D. ACI desires to issue up to One Hundred Twenty-
Five Million Dollars ($125,000,000.00) in Senior
Subordinated Notes due 2004 (the "Initial Senior
Subordinated Notes") in a limited offering to Qualified
Institutional Buyers (as defined in Rule 144A of the
Securities and Exchange Commission (the "SEC")), accredited
institutional investors (as defined in Rule 501(a)(1), (2),
(3) or (7) of Regulation D of the SEC) and outside the
United States to certain persons in reliance on Regulation S
of the SEC, which Initial Senior Subordinated Notes are
intended to be issued under and pursuant to an indenture
(the "Indenture") a draft of which has been provided to and
reviewed by the Lenders. ACI intends to use all net
proceeds from the issuance of the Initial Senior
Subordinated Notes to reduce Indebtedness of the Borrower
Consolidation, including Funded Obligations under the Credit
Facility.
E. Following the issuance of the Initial Senior
Subordinated Notes and in order to facilitate trading in
such debt securities, ACI intends to file a registration
statement with the SEC seeking to register an exchange offer
for the exchange of the Initial Senior Subordinated Notes
for an issue of up to One Hundred Twenty-Five Million
Dollars ($125,000,000.00) in Senior Subordinated Notes due
2004 (the "Exchange Senior Subordinated Notes") under and
pursuant to the Indenture. The Exchange Senior Subordinated
Notes will be identical in all material respects to the
Initial Senior Subordinated Notes.
F. The Borrower Consolidation desires to
refinance the Existing Bank Loan, Existing Credit Agreement
and Existing Note for the purpose of adding CPI, ACVI, ACCBI
and ACLVI as Borrowers and increasing the maximum amount
available for Borrowing to One Hundred Twenty-Five Million
Dollars ($125,000,000.00), including a swingline subfacility
for fundings in smaller minimum amounts and on shorter
notice in the maximum amount of Five Million Dollars
($5,000,000.00) at any time outstanding.
G. Lenders are willing to refinance the Existing
Credit Agreement and Existing Note for the purpose of
<PAGE>establishing the Credit Facility in the initial
principal amount of One Hundred Twenty-Five Million Dollars
($125,000,000.00), including the Swingline Facility to be
funded by the Swingline Lender, as a subfacility in the
maximum aggregate amount of Five Million Dollars
($5,000,000.00) 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:
"ACCBI Assignment of Permits, Licenses and
Contracts" shall mean the assignment to be executed by ACCBI
on or before the Closing Date, pursuant to which ACCBI
assigns to Agent Bank on behalf of the Lenders, as
additional security for the Bank Facilities, all of its
right, title and interest in and to all permits, licenses
and contracts relating to the ACCBI Riverboat/Hotel
Facilities, except those gaming permits and licenses which
are unassignable and except those permits, licenses and
contracts which may not be assigned without obtaining the
consent of ACCBI's counterparty, as such assignment may be
amended, modified, extended, renewed or restated from time
to time.
"ACCBI Assignment of Spaceleases, Contracts, Rents
and Revenues" shall mean the assignment to be executed by
ACCBI on or before the Closing Date, pursuant to which ACCBI
assigns to Agent Bank on behalf of the Lenders, as
additional security for the Bank Facilities: (a) all of its
right, title and interest under all ACCBI Equipment Leases
and Contracts and ACCBI Space Leases relating to the ACCBI
Riverboat/Hotel Facilities, and (b) all rents, issues,
profits, revenues and income from the ACCBI Premises and the
ACCBI Riverboat/Hotel Facilities and any other business
activity conducted on the ACCBI Premises, together with any
future expansions thereof, related thereto or used in
connection therewith, as such
<PAGE>assignment may be amended, modified, extended, renewed
or restated from time to time.
"ACCBI Collateral" shall mean collective reference
to: (i) all of the ACCBI Riverboat, ACCBI Premises, ACCBI
FF&E and the contract rights, leases, intangibles and other
interests of ACCBI, which are subject to the liens and
security interests of the ACCBI Security Documents; (ii) all
rights of ACCBI assigned as additional security pursuant to
the terms of the ACCBI Security Documents; and (iii) any and
all other property and/or intangible rights, interest or
benefits inuring to or in favor of ACCBI, 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 Bank Facilities.
"ACCBI Deed of Trust" shall mean the Deed of
Trust, Fixture Filing and Security Agreement with Assignment
of Rents to be executed by ACCBI on or before the Closing
Date in favor of Agent Bank, on behalf of Lenders,
encumbering the ACCBI Premises, the ACCBI FF&E and other
ACCBI Collateral therein described for the purpose of
securing the Bank Facilities and Borrowers' payment and
performance under each of the Loan Documents (other than the
Environmental Certificate) as such deed of trust may be
amended, modified, extended, renewed or restated from time
to time.
"ACCBI Equipment Leases and Contracts" shall mean
the executed leases and purchase contracts pertaining to the
ACCBI FF&E wherein ACCBI is the lessee or vendee, as the
case may be, as set forth on that certain scheduled marked
"Schedule 4.16(A)", affixed hereto and by this reference
incorporated herein and made a part hereof.
"ACCBI Equipment Lender" shall mean WFB, as the
successor by merger to First Interstate Bank of Nevada,
N.A., in its capacity as the lender under the ACCBI
Equipment Loan.
"ACCBI Equipment Loan" shall mean the loan by the
ACCBI Equipment Lender to ACCBI as evidenced by the ACCBI
Equipment Loan Documents.
"ACCBI Equipment Loan Documents" shall mean
collective reference to (i) that certain Promissory Note
dated December 12, 1995, in the original principal amount of
Seven Million One Hundred Thirty-Seven Thousand Four Hundred
Dollars ($7,137,400.00) executed by ACCBI, payable to the
order of the ACCBI Equipment Lender, (ii) that certain Loan
Agreement dated
<PAGE>December 12, 1995, executed by and among ACCBI, as
borrower, ACI, as guarantor and ACCBI Equipment Lender,
(iii) that certain Security Agreement dated December 12,
1995, executed by ACCBI, as grantor, and the ACCBI Equipment
Lender, as secured party, (iv) the ACCBI Equipment Loan
Financing Statements, and (v) the ACCBI Equipment Ship
Mortgage.
"ACCBI Equipment Loan Financing Statements" shall
mean collective reference to the UCC Financing Statements
executed by ACCBI in favor of the ACCBI Equipment Lender
filed (i) in the Office of the County Recorder of
Pottawattamie County, Iowa, on December 14, 1995, under File
No. G76353, and (ii) in the Office of the Secretary of State
of the State of Iowa on December 14, 1995, under file number
K695761.
"ACCBI Equipment Ship Mortgage" shall mean the
Preferred Ship Mortgage dated December 12, 1995, executed by
ACCBI, as grantor, in favor of the ACCBI Equipment Lender,
received by the USCG, New Orleans Office, on December 13,
1995, and recorded in the NVDC in Book 95-5, as Instrument
No. 789.
"ACCBI 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 or owned
by ACCBI in connection with the operation of the ACCBI
Riverboat/Hotel Facilities.
"ACCBI Fee Property" shall mean the real property
owned by ACCBI which is more particularly described on that
certain schedule marked "Schedule A-1", affixed hereto and
by this reference incorporated herein and made a part
hereof.
"ACCBI Financing Statements" shall mean the
Uniform Commercial Code Financing Statements to be filed in
the office of the Secretary of State of the State of Iowa,
and in the office of the County Recorder of Pottawattamie
County, Iowa, in order to perfect the security interest
granted to Agent Bank on behalf of the Lenders under the
ACCBI Deed of Trust and other ACCBI Security Documents in
accordance with the requirements of the Iowa Uniform
Commercial Code, as they may be amended, modified, extended,
renewed or restated from time to time.
"ACCBI Hotel Attornment Agreement" shall mean that
certain Second Recognition, Nondisturbance and Attornment
Agreement to be executed on or before the Closing Date by
and among Council Bluffs Hotel Associates, ACCBI, Agent Bank
and
<PAGE>Miller & Schroeder Investments Corporation, a
Minnesota corporation (as the holder of a mortgage lien on
the interest of Council Bluffs Hotel Associates under the
ACCBI Hotel Lease and the ACCBI Hotel Easement) pursuant to
which, among other things: (i) the interest of Council
Bluffs Hotel Associates under the ACCBI Hotel Lease and the
ACCBI Hotel Easement is subordinated to the lien of the
ACCBI Deed of Trust; (ii) Agent Bank agrees that, upon
acquisition of ACCBI Fee Property by Foreclosure under the
ACCBI, or conveyance in lieu thereof, Agent Bank (or any
purchaser at a foreclosure sale) will recognize and attorn
to the interest of Council Bluffs Hotel Associates under the
ACCBI Hotel Lease and the ACCBI Hotel Easement; and
(iii) Miller and Schroeder Investments Corporation consents
to the terms and conditions set forth therein.
"ACCBI Hotel Easement" shall mean that certain
Easement from ACCBI, as grantor, to Kinseth Hotel
Corporation, an Iowa corporation which is recorded in the
office of the County Recorder of Pottawattamie County, Iowa
On April 3, 1996, in Book 96, at Page 28334, as amended by
that certain Amendment to Easement by and between ACCBI and
Council Bluffs Hotel Associates as the successor to Kinseth
Hotel Corporation, which Amendment to Easement was recorded
in the office of the County Recorder of Pottawattamie
County, Iowa on June 25, 1996, in Book 96 at Page 39287, all
pursuant to which Council Bluffs Hotel Associates is
granted: (i) a nonexclusive right of way easement over and
across that portion of the ACCBI Fee Property which is
described by Exhibit "A" to said Amendment to Easement; and
(ii) a nonexclusive easement for vehicular and pedestrian
ingress and egress over roads, driveways and sidewalks which
are situate from time to time upon Ameristar Property that
is adjacent to the ACCBI Hotel Lease Parcel; both of which
easements are granted to Council Bluffs Hotel Associates to
be utilized in connection with Council Bluffs Hotel
Associates occupation and use of the ACCBI Hotel Parcel
under the ACCBI Hotel Lease; and as said Easement may be
further amended, modified, extended, renewed or restated
from time to time.
"ACCBI Hotel Lease" shall mean that certain
Amended and Restated Ground Lease Agreement under date of
September 7, 1995, by and between ACCBI, as lessor, and
Kinseth Hotel Corporation, an Iowa corporation, as lessee,
record notice of which is granted pursuant to a Memorandum
of Ground Lease that is recorded in the office of the County
Recorder of Pottawattamie County, Iowa on April 3, 1996 in
Book 96 at Page 28330, with the lessee's interest thereunder
having been
<PAGE>assigned to Council Bluffs Hotel Associates by an
Assignment of Ground Lease recorded in the office of the
County Recorder of Pottawattamie County, Iowa on May 13,
1996 in Book 96 at Page 33420, as such lease is amended by
that certain Amendment No. 1 to Amended and Restated Ground
Lease under date of May 1, 1996, record notice of which is
granted pursuant to an Amendment to Memorandum of Ground
Lease recorded in the office of the County Recorder of
Pottawattamie County, Iowa on June 25, 1996 in Book 96 at
Page 39290; all pursuant to which: (i) the ACCBI Hotel
Parcel is leased to Council Bluffs Hotel Associates for the
purpose of building and maintaining a hotel thereon;
(ii) Council Bluffs Hotel Associates is granted a right of
first refusal with respect to any sale by ACCBI of any
portion of the ACCBI Fee Property to be used for
construction of a hotel; (iii) ACCBI is granted a right of
first refusal with respect to, and an option to purchase,
the ACCBI Hotel Parcel; and (iv) Council Bluffs Hotel
Associates is granted certain licenses and easements with
respect to the ACCBI Fee Property; all as more particularly
set forth therein; as such Amended and Restated Ground Lease
Agreement may be further amended, modified, extended,
renewed or restated from time to time.
"ACCBI Hotel Parcel" shall mean that parcel of
real property which is situate within the ACCBI Fee Property
and is particularly described by Exhibit "A" to the
Amendment to Memorandum of Ground Lease under date of May 1,
1996, that is recorded in the office of the County Recorder
of Pottawattamie County, Iowa on June 25, 1996, in Book 96
at Page 39290.
"ACCBI IDNR Attornment Agreement" shall mean the
Second Attornment Agreement for the benefit of Mortgagee to
be executed on or before the Closing Date by and among ACCBI
and IDNR pursuant to which, among other things, certain
representations and assurances are made for the benefit of
the Banks with regard to the terms and conditions of the
ACCBI Land Use Agreement, and with regard to Agent Bank's
entitlement to the benefit of those provisions set forth by
the ACCBI Land Use Agreement which are defined therein as
the "Mortgagee Protection Provisions".
"ACCBI Land Use Agreement" shall mean the
Settlement Use and Management Agreement and IDNR Permit
dated May 15, 1995, executed between IDNR and Koch providing
for the occupancy and use of the IDNR Parcel, with the
interest of Koch therein having been assigned to ACCBI
pursuant to that certain Assignment and Assumption Agreement
executed by Koch and by ACCBI under date of July 26, 1995,
as such Settlement,
<PAGE>Use and Management Agreement and IDNR Permit may be
amended, modified, extended, renewed or restated from time
to time.
"ACCBI 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 ACCBI Riverboat/Hotel
Facilities; (v) liens created or contemplated by the ACCBI
Security Documents, (vi) the liens, encumbrances and
restrictions on the ACCBI Real Property, ACCBI FF&E and
existing improvements which are shown as exceptions on
Schedule B of the ACCBI Title Insurance Policy to be issued
by the 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
ACCBI FF&E to the extent permitted by Section 6.08, (ix) the
GECC Ship Mortgage and any Liens created thereby, (x) the
Liens securing the ACCBI Equipment Loan, including the ACCBI
Equipment Ship Mortgage and ACCBI Equipment Loan Financing
Statements, (xi) 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 ACCBI Premises or (B) does not interfere in
any material respect with the ACCBI Riverboat/Hotel
Facilities; and (xii) judgment liens, writs, warrants,
levies, distraints, attachments and other similar process
which do not constitute an Event of Default.
"ACCBI Premises" shall mean collective reference
to the ACCBI Fee Property and the IDNR Parcel.
<PAGE> "ACCBI Riverboat" shall mean the whole of the
vessel named below and described as follows:
Vessel Name Official Number
AMERISTAR II 1035267
together with any and all present and future engines,
boilers, machinery, components, masts, boats, anchors,
cables, chains, rigging, tackle, apparel, furniture,
capstans, outfit, tools, pumps, gear, furnishings,
appliances, fittings, spare and replacement parts, and any
and all other appurtenances thereto, appertaining or
belonging to the ACCBI Riverboat, whether now or hereafter
acquired, and whether on board or not on board, together
with any and all present and future additions, improvements,
and replacements therefor, made in or to the ACCBI
Riverboat, or any part or parts thereof; and all accounts,
earned hire, charter payments, freight, earnings, revenues,
income and profit therefrom and additionally, all log books,
manuals, trip records, maintenance records, inspection
reports, seaworthiness certificates, and other historical
records or information relating to the ACCBI Riverboat; all
of which shall be deemed to be included in any reference
herein to the term "ACCBI Riverboat".
"ACCBI Riverboat/Hotel Facilities" shall mean the
riverboat casino hotel business and related activities
conducted by ACCBI in and on the ACCBI Premises and ACCBI
Riverboat and all improvements now or hereafter situate
thereon.
"ACCBI Security Documents" shall mean collective
reference to the ACCBI Deed of Trust, ACCBI Ship Mortgage,
ACCBI Financing Statements, ACCBI Assignment of Permits,
Licenses and Contracts, ACCBI Assignment of Spaceleases,
Contracts, Rents and Revenues, ACCBI IDNR Attornment
Agreement, ACCBI Hotel Attornment Agreement and all other
documents, instruments or agreements which are executed or
delivered by or on behalf of ACCBI, and accepted by Agent
Bank, on behalf of Lenders, as security for payment of the
Bank Facilities.
"ACCBI Ship Mortgage" shall mean the Preferred
Ship Mortgage to be executed by ACCBI on or before the
Closing Date wherein ACCBI, as owner and mortgagor, grants a
first mortgage lien in favor of Agent Bank on behalf of
Lenders in and to the ACCBI Riverboat and other ACCBI
Collateral more particularly therein described, as such
ACCBI Ship Mortgage may be amended, supplemented or
otherwise modified from time to time.
<PAGE> "ACCBI Spaceleases" shall mean the executed leases
and concession agreements pertaining to the ACCBI
Riverboat/Hotel Facilities, or any portion thereof, wherein
ACCBI is the lessor as set forth on the certain schedule
marked "Schedule 4.15(A)", affixed hereto and by this
reference incorporated herein and made a part hereof.
"ACCBI Title Insurance Policy" shall mean the ALTA
Extended Coverage Lenders Policy of Title Insurance, and the
endorsements thereto, which are to be issued by the Title
Insurance Company, as of the Closing Date, in the amount of
Eighteen Million Four Hundred Thousand Dollars
($18,400,000.00), in favor of Agent Bank, insuring the ACCBI
Deed of Trust as first priority mortgage or leasehold liens,
as applicable, encumbering the ACCBI Premises subject only
to the exceptions shown therein in Schedule B, Part One,
together with such endorsements thereto as are required by
Agent Bank (including, without limitation, a Tie-In
endorsement with regard to the remaining Title Insurance
Policies) all in accordance with the Closing Instructions.
"ACLVI Assignment of Permits, Licenses and
Contracts" shall mean the assignment to be executed by ACLVI
on or before the Closing Date, pursuant to which ACLVI
assigns to Agent Bank on behalf of Lenders, as additional
security for the Bank Facilities, all of its right, title
and interest in and to all permits, licenses and contracts
relating to the ACLVI Hotel/Casino Facility, except those
gaming permits and licenses which are unassignable and
except those permits, licenses and contracts which may not
be assigned without obtaining the consent of ACLVI's
counterparty, as such assignment may be amended, modified,
extended, renewed or restated from time to time.
"ACLVI Assignment of Spaceleases, Contracts, Rents
and Revenues" shall mean the assignment to be executed by
ACLVI on or before the Closing Date, whereby ACLVI assigns
to Agent Bank on behalf of Lenders, as additional security
for the Bank Facilities: (a) all of its right, title and
interest under all ACLVI Spaceleases and ACLVI Equipment
Leases and Contracts relating to the ACLVI Hotel/Casino
Facility and (b) all rents, issues, profits, revenues and
income from the ACLVI Real Property and the ACLVI
Hotel/Casino Facility and any other business activity
conducted on the ACLVI 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.
<PAGE> "ACLVI Collateral" shall mean collective reference
to: (i) all of the ACLVI Real Property, ACLVI FF&E, and the
contract rights, leases, intangibles and other interests of
ACLVI, which are subject to the liens and security interests
of the ACLVI Security Documents; (ii) all rights of ACLVI
assigned as additional security pursuant to the terms of the
ACLVI Security Documents; and (iii) any and all other
property and/or intangible rights, interest or benefits
inuring to or in favor of ACLVI, 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 Bank Facilities.
"ACLVI Deed of Trust" shall mean the Deed of
Trust, Fixture Filing and Security Agreement with Assignment
of Rents to be executed by ACLVI on or before the Closing
Date in favor of Agent Bank on behalf of the Lenders,
encumbering the ACLVI Real Property, ACLVI FF&E and other
ACLVI Collateral therein described, together with ACLVI's
rights under the Option Agreement and all right, title and
interest of ACLVI acquired on and after the Closing Date in
and to the Option Property or any portion or portions
thereof, for the purpose of securing the Bank Facilities and
Borrowers' payment and performance under each of the Loan
Documents (other than the Environmental Certificate), as
such deed of trust may be amended, modified, extended,
renewed or restated from time to time.
"ACLVI Equipment Leases and Contracts" shall mean
the executed leases and purchase contracts pertaining to the
ACLVI FF&E wherein ACLVI is the lessee or vendee, as the
case may be, as set forth on that certain schedule marked
"Schedule 4.16(D)", affixed hereto and by this reference
incorporated herein and made a part hereof.
"ACLVI 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 or owned
by ACLVI in connection with the operation of the ACLVI
Hotel/Casino Facility.
"ACLVI Financing Statements" shall mean the
Uniform Commercial Code financing statements to be filed in
the Office of the Secretary of State of the State of Nevada
and in the Office of the County Recorder of Clark County,
Nevada, in order to perfect the security interest granted to
Agent Bank on behalf of Lenders under the ACLVI Deed of
Trust and other ACLVI Security Documents in accordance with
requirements of the Nevada Uniform Commercial Code, as such
financing
<PAGE>statements may be amended, modified, extended, renewed
or restated from time to time.
"ACLVI Hotel/Casino Facility" shall mean the
improvements and the hotel and casino business and related
activities to be conducted on the ACLVI Real Property
following completion of the ACLVI Project.
"ACLVI 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 ACLVI Hotel/Casino Facility;
(v) liens created or contemplated by the ACLVI Security
Documents, (vi) the liens, encumbrances and restrictions on
the ACLVI Real Property, ACLVI FF&E and existing
improvements which are shown as exceptions on Schedule B of
the ACLVI Title Insurance Policy to be issued by 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 ACLVI FF&E
to the extent permitted by Section 6.08, 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 ACLVI Real Property
or (B) does not interfere in any material respect with the
ACLVI Hotel/Casino Facility; and (x) judgment liens, writs,
warrants, levies, distraints, attachments and other similar
process which do not constitute an Event of Default.
<PAGE> "ACLVI Project" shall mean the Phase I of the
hotel and casino facility to be developed, constructed and
completed on the ACLVI Real Property, consisting of
approximately thirty-five thousand (35,000) square feet of
casino space, at least two hundred (200) hotel rooms, four
(4) restaurants, six (6) lounges, a race and sports book,
facilities and a pool.
"ACLVI Real Property" shall mean the real property
owned by ACLVI which is more particularly described on that
certain schedule marked "Schedule D-1", affixed hereto and
by this reference incorporated herein and made a part
hereof, together with all portions of the Option Property to
which ACLVI acquires title on and after the Closing Date.
"ACLVI Security Documents" shall mean collective
reference to the ACLVI Deed of Trust, ACLVI Assignment of
Spaceleases, Contracts, Rents and Revenues, ACLVI Assignment
of Permits, Licenses and Contracts, the ACLVI Financing
Statements, Assignment of Architect's Contract, Assignment
of Existing General Contractor's Agreement, Assignment of
New General Contractor's Agreement, Assignment of Interior
Designer's Contract, Major Subcontractor Assignments and all
other documents, instruments or agreements which are
executed or delivered by or on behalf of ACLVI, and accepted
by Agent Bank, on behalf of the Lenders, as security for
payment of the Bank Facilities.
"ACLVI Spaceleases" shall mean the executed leases
and concession agreements pertaining to the ACLVI
Hotel/Casino Operation, or any portion thereof, wherein
ACLVI is the lessor, as set forth on that certain schedule
marked "Schedule 4.15(D)", affixed hereto and by this
reference incorporated herein and made a part hereof.
"ACLVI Title Insurance Policy" shall mean the ALTA
Extended Coverage Lenders Policy of Title Insurance, and the
endorsements thereto, which are to be issued by the Title
Insurance Company, as of the Closing Date, in the amount of
Forty-Nine Million Seven Hundred Thousand Dollars
($49,700,000.00), in favor of Agent Bank, insuring the ACLVI
Deed of Trust as a first priority mortgage lien encumbering
the ACLVI Real Property therein described subject only to
the exceptions shown therein in Schedule B, Part One,
together with all such endorsements thereto as are required
by Agent Bank (including, without limitation, a Tie-In
endorsement with regard to the remaining Title Insurance
Policies); all in accordance with the Closing Instructions.
<PAGE> "ACVI Assignment of Permits, Licenses and
Contracts" shall mean the assignment to be executed by ACVI
on or before the Closing Date, pursuant to which ACVI
assigns to Agent Bank on behalf of the Lenders, as
additional security for the Bank Facilities, all of its
right, title and interest in and to all assignable permits,
licenses and contracts relating to the ACVI Casino Facility,
except those gaming permits and licenses which are
unassignable and except those permits, licenses and
contracts which may not be assigned without obtaining the
consent of ACVI's counterparty, as such assignment may be
amended, modified, extended, renewed or restated from time
to time.
"ACVI Assignment of Spaceleases, Contracts, Rents
and Revenues" shall mean the Assignment to be executed by
ACVI on or before the Closing Date, pursuant to which ACVI
assigns to Agent Bank on behalf of the Lenders, as
additional security for the Bank Facilities: (a) all of its
right, title and interest under all ACVI Equipment Leases
and Contracts and ACVI Spaceleases relating to the ACVI
Casino Facility, and (b) all rents, issues, profits,
revenues and income from the ACVI Casino Facility and any
other business activity conducted at the ACVI Casino
Facility, together with any 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.
"ACVI Casino Deed of Trust" shall mean that
certain Deed of Trust, Fixture Filing and Security Agreement
with Assignment of Rents to be executed by ACVI as of the
Closing Date in favor of Agent Bank, on behalf of Lenders,
encumbering the ACVI Fee Property and ACVI's interest in the
ACVI Leased Parcels for the purpose of securing the Bank
Facilities and all other sums which may be owing by
Borrowers to the Banks from time to time under the terms of
the Credit Agreement, as it may be amended, modified,
extended, renewed or restated from time to time.
"ACVI Casino Facility" shall mean the riverboat
casino business and related activities conducted by ACVI in
and on the ACVI Fee Property and ACVI Leased Parcels and
ACVI Riverboat and all improvements now or hereafter situate
thereon.
"ACVI Casino Financing Statements" shall mean the
Uniform Commercial Code Financing Statements to be filed in
the office of the Secretary of State of the State of
Mississippi, and in the office of the Chancery Clerk of
Warren
<PAGE>County, Mississippi, in order to perfect the security
interest granted to Agent Bank on behalf of the Lenders
under the ACVI Casino Deed of Trust in accordance with the
requirements of the Mississippi Uniform Commercial Code, as
such financing statements may be amended, modified,
extended, renewed or restated from time to time.
"ACVI Collateral" shall mean collective reference
to: (i) all of the ACVI Riverboat, ACVI Premises, ACVI FF&E
and the contract rights, leases, intangibles and other
interests of ACVI, which are subject to the liens and
security interests of the ACVI Security Documents; (ii) all
rights of ACVI assigned as additional security pursuant to
the terms of the ACVI Security Documents; and (iii) any and
all other property and/or intangible rights, interest or
benefits inuring to or in favor of ACVI, 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 Bank Facilities.
"ACVI Estoppel Certificates" shall mean collective
reference to the Brady/Lum Estoppel Certificate and Magnolia
Estoppel Certificate, Morrison Estoppel Certificate and the
Trustmark Nondisturbance Agreement.
"ACVI Equipment Leases and Contracts" shall mean
the executed leases and purchase contracts pertaining to the
ACVI FF&E wherein ACVI 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.
"ACVI 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 or owned by
ACVI in connection with the operation of the ACVI Casino
Facility.
"ACVI Fee Property" shall mean the real property
owned by ACVI which is described on that certain schedule
marked "Schedule B-1", affixed hereto and by this reference
incorporated herein and made a part hereof.
"ACVI Hotel" shall mean the hotel to be
constructed by the ACVI Hotel Subsidiary on the ACVI Hotel
Property with the proceeds of the ACVI Hotel Construction
Loan as permitted under Section 6.08(d).
<PAGE> "ACVI Hotel Construction Deed of Trust" shall mean
the Deed of Trust, Fixture Filing and Security Agreement
with Assignment of Rents to be executed by the ACVI Hotel
Subsidiary in favor of any ACVI Hotel Construction Lender
for the purpose of securing the payment of any ACVI Hotel
Construction Loan and any ACVI Hotel Construction Note.
"ACVI Hotel Construction Financing Statements"
shall mean the Uniform Commercial Code Financing Statements
to be filed in the Office of the Secretary of State of the
State of Mississippi and in the Office of the Chancery Clerk
of Warren County, Mississippi in order to perfect the
security interest granted to any ACVI Hotel Construction
Lender under any ACVI Hotel Construction Deed of Trust in
accordance with the requirements of the Mississippi Uniform
Commercial Code, as such financing statements may be
amended, modified, extended, renewed or restated from time
to time.
"ACVI Hotel Construction Lender" shall mean the
Person which funds any ACVI Hotel Construction Loan and is
the holder of the ACVI Hotel Construction Note and the
beneficiary and secured party under the ACVI Hotel
Construction Security Documents.
"ACVI Hotel Construction Loan" shall mean a loan
or loans to be made by the ACVI Hotel Construction Lender to
the ACVI Hotel Subsidiary for construction of a hotel on the
ACVI Hotel Property together with any refinancings thereof,
which ACVI Hotel Construction Loan shall not exceed a
maximum aggregate principal amount of Seven Million Dollars
($7,000,000.00) and shall contain terms consistent with the
provisions set forth in Section 6.08(d) of this Credit
Agreement.
"ACVI Hotel Construction Note" shall mean the
promissory note to be executed by the ACVI Hotel Subsidiary,
payable to the order of any ACVI Hotel Construction Lender,
evidencing any ACVI Hotel Construction Loan.
"ACVI Hotel Construction Security Documents" shall
mean collective reference to the ACVI Hotel Construction
Deed of Trust and the ACVI Hotel Construction Financing
Statements.
"ACVI Hotel Deed of Trust" shall mean that certain
Deed of Trust, Fixture Filing and Security Agreement with
Assignment of Rents to be executed by ACVI as of the Closing
Date in favor of Agent Bank, on behalf of Lenders,
encumbering the ACVI Hotel Property, all improvements
constructed thereon
<PAGE>and all ACVI FF&E located thereon for the purpose of
securing the Bank Facilities and all other sums which may be
owing by Borrowers to the Banks from time to time under the
terms of the Credit Agreement, as it may be amended,
modified, extended, renewed or restated from time to time.
"ACVI Hotel Financing Statements" shall mean the
Uniform Commercial Code Financing Statements to be filed in
the office of the Secretary of State of the State of
Mississippi, and in the office of the Chancery Clerk of
Warren County, Mississippi, in order to perfect the security
interest granted to Agent Bank on behalf of the Lenders
under the ACVI Hotel Deed of Trust in accordance with the
requirements of the Mississippi Uniform Commercial Code, as
such financing statements may be amended, modified,
extended, renewed or restated from time to time.
"ACVI Hotel Property" shall mean the real property
owned by ACVI which is described on that certain schedule
marked "Schedule B-5," affixed hereto and by this reference
incorporated herein and made a part hereof.
"ACVI Hotel Subsidiary" shall mean AC Hotel Corp.,
a Mississippi Corporation, which is the corporation formed
as a wholly owned subsidiary of ACVI for the purpose of
holding title to the ACVI Hotel Property and constructing
and owning the hotel to be constructed on the ACVI Hotel
Property.
"ACVI Land Leases" shall mean collective reference
to the Brady/Lum Lease, Magnolia Lease and Morrison Lease.
"ACVI Leased Parcels" shall mean collective
reference to the Brady/Lum Parcel, Magnolia Parcel and
Morrison Parcel.
"ACVI 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
<PAGE>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 ACVI Casino Facility;
(v) Liens created or contemplated by the ACVI Security
Documents, (vi) the liens, encumbrances and restrictions on
the ACVI Premises, ACVI FF&E and existing improvements which
are shown as exceptions on Schedule B of the ACVI Title
Insurance Policy to be issued by 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 ACVI FF&E and ACVI Hotel Construction
Security Documents to the extent permitted by Section 6.08,
(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 ACVI
Premises or (B) does not interfere in any material respect
with the ACVI Casino Facility; and (x) judgment liens,
writs, warrants, levies, distraints, attachments and other
similar process which do not constitute an Event of Default.
"ACVI Premises" shall mean collective reference to
the ACVI Fee Property, the ACVI Leased Parcels and the ACVI
Hotel Property.
"ACVI Riverboat" shall mean the whole of the
vessel named below and described as follows:
Vessel Name Official Number
AMERISTAR 515275
together with any and all present and future engines,
boilers, machinery, components, masts, boats, anchors,
cables, chains, rigging, tackle, apparel, furniture,
capstans, outfit, tools, pumps, gear, furnishings,
appliances, fittings, spare and replacement parts, and any
and all other appurtenances thereto, appertaining or
belonging to the ACVI Riverboat, whether now or hereafter
acquired, and whether on board or not on board, together
with any and all present and future additions, improvements,
and replacements therefor, made in or to the ACVI Riverboat,
or any part or parts thereof; and all accounts, earned hire,
charter payments, freight, earnings, revenues, income and
profit therefrom and additionally, all
<PAGE>log books, manuals, trip records, maintenance records,
inspection reports, seaworthiness certificates, and other
historical records or information relating to the ACVI
Riverboat; all of which shall be deemed to be included in
any reference herein to the term "ACVI Riverboat".
"ACVI Security Documents" shall mean collective
reference to the ACVI Casino Deed of Trust, ACVI Hotel Deed
of Trust, ACVI Ship Mortgage, ACVI Casino Financing
Statements, ACVI Hotel Financing Statements, ACVI Assignment
of Permits, Licenses and Contracts, ACVI Assignment of
Spaceleases, Contracts, Rents and Revenues, ACVI Estoppel
Certificates and all other documents, instruments or
agreements which are executed or delivered by or on behalf
of ACVI, and accepted by Agent Bank, on behalf of Lenders,
as security for payment of the Bank Facilities.
"ACVI Ship Mortgage" shall mean the First
Preferred Ship Mortgage to be executed by ACVI on or before
the Closing Date wherein ACVI, as owner and mortgagor,
grants a first mortgage lien in favor of Agent Bank on
behalf of Lenders in and to the ACVI Riverboat and other
ACVI Collateral more particularly therein described, as such
ACVI Ship Mortgage may be amended, supplemented or otherwise
modified from time to time.
"ACVI Spaceleases" shall mean the executed leases
and concession agreements pertaining to the ACVI Casino
Facility, or any portion thereof, wherein ACVI is the lessor
as set forth on the certain schedule marked
"Schedule 4.15(B)", affixed hereto and by this reference
incorporated herein and made a part hereof.
"ACVI Title Insurance Policy" shall mean the ALTA
Extended Coverage Lenders Policy of Title Insurance, and the
endorsements thereto, which are to be issued by Title
Insurance Company, as of the Closing Date, in the amount of
Thirty Million One Hundred Thousand Dollars ($30,100,000.00)
in favor of Agent Bank, insuring: (i) the ACVI Casino Deed
of Trust as first priority mortgage or leasehold liens, as
applicable, encumbering the ACVI Fee Property and the ACVI
Leased Parcels therein described; and (ii) the ACVI Hotel
Deed of Trust as a first priority mortgage lien encumbering
the ACVI Hotel Property therein described; both subject only
to the exceptions shown therein in Schedule B, Part One
together with such endorsements thereto as are required by
Agent Bank (including, without limitation, a Tie-In
endorsement with
<PAGE>regard to the remaining Title Insurance Policies); all
in accordance with the Closing Instructions.
"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 actually paid federal and
state taxes on or measured by income, less
(iii) Distributions actually paid, less
(iv) treasury stock purchases
Divided by ()
The sum of: (i) the aggregate amount of actually
paid Interest Expense, plus (ii) the aggregate of
Scheduled Reductions, plus (iii) the aggregate of
actual principal payments made on the Gem
Settlement Notes, plus (iv) principal payments or
reductions (without duplication) required to be
made on all other Indebtedness, plus (v) the
current portion of Capitalized Lease Liabilities,
in each case of (i) through (v) determined for the
Fiscal Quarter under review together with the most
recently ended three (3) preceding Fiscal
Quarters.
"Affiliate", as applied to any Person, means any
other Person directly or indirectly controlling, controlled
by, or under common control with, that Person (provided,
however, that Rebeil and Magliarditi shall not be deemed to
be Affiliates of any Borrower by reason of the issuance of
the Gem Settlement Notes or other payments to be made under
the Gem Merger Agreement or Gem Settlement Agreement or by
reason of the Gem Merger Agreement or Gem Settlement
Agreement). 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 and
Swingline Lender.
<PAGE> "Aggregate Commitment" shall mean reference to the
aggregate amount committed by Lenders for advance to or on
behalf of the Borrower Consolidation as Borrowings and
Construction Disbursements under the Credit Facility in the
initial principal amount of One Hundred Twenty-Five Million
Dollars ($125,000,000.00), subject to the limitations for
advance as set forth in the definition of Maximum Permitted
Balance.
"Aggregate Commitment Reduction Schedule" shall
mean the Aggregate Commitment Reduction Schedule marked
"Schedule 2.01(c)", affixed hereto and by this reference
incorporated herein and made a part hereof, setting forth
the Scheduled Reductions and Maximum Scheduled Balance as of
each Reduction Date under the Credit Facility.
"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 per annum percentage amount to
be added to the Base Rate or the LIBO Rate, as the case may
be, as follows: (i) commencing on the Closing Date and
continuing until the Rate Adjustment Date, one and one-
quarter percent (1.25%) to be added to the Base Rate and two
and one-half percent (2.5%) to be added to the applicable
LIBO Rate; (ii) commencing on the Rate Adjustment Date and
continuing until the Maturity Date, the margin rates set
forth in the table below based on the Leverage Ratio of the
Borrower Consolidation as of each Fiscal Quarter end,
commencing with the end of the Fiscal Quarter ending
September 30, 1997, 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 month immediately following each such Fiscal Quarter
end:
LIBO
LEVERAGE RATIO BASE RATE RATE
MARGIN MARGIN
Greater than 4.00 2.25% 3.5%
to 1.00
Greater than 3.00 1.75% 3.00%
to 1.00 but less
than or equal to
4.00 to 1.00
<PAGE>
LIBO
LEVERAGE RATIO BASE RATE RATE
MARGIN MARGIN
Greater than 2.0 1.25% 2.50%
to 1.0 but less
than or equal to
3.0 to 1.00
Greater than 1.00 0.75% 2.00%
to 1.0 but less
than or equal to
2.0 to 1.00
Less than or equal 0.25% 1.50%
to 1.00 to 1.00
"Architect" shall mean Morris & Brown Architects,
Ltd., 1695 Meadow Wood Lane, No. 220, Reno, Nevada 89502,
who has been engaged by ACLVI for the purpose of preparing
the Structural Plans and Specifications for the design of
the structural and exterior components of the ACLVI Project.
"Architect's Consent" shall mean that certain
Architect's Consent and Agreement which is to be executed by
the Architect and delivered to Agent Bank, on behalf of the
Lenders, prior to the Initial Construction Disbursement, for
the purpose, among other things, of evidencing the
Architect's: (i) consent to Assignment of Architect's
Contract; (ii) agreement not to modify the Architect's
Contract without Agent Bank's consent; and (iii) agreement
to continue performance under the Architect's Contract on
behalf of Agent Bank subject to the terms and conditions set
forth therein.
"Architect's Contract" shall mean the Standard
Form of Agreement Between Owner and Architect for Designated
Services, AIA Document B161, 1977 Edition, dated as of
December 12, 1996, by and between Architect and ACLVI under
the terms of which Architect agrees to provide architectural
services in connection with the design of the structural and
exterior components of the ACLVI Project including, but not
limited to, preparation of the Structural Plans and
Specifications.
"Assigned Major Subcontract(s)" shall have the
meaning set forth in Section 5.27(b).
"Assignment and Assumption Agreement" shall mean
the document evidencing an assignment of a Syndication
<PAGE>Interest by any Lender to an Eligible Assignee in the
form of the Assignment, Assumption and Consent Agreement
marked "Exhibit L", affixed hereto and by this reference
incorporated herein and made a part hereof.
"Assignment of Architect's Contract" shall mean
the Assignment of Architect's Contract with Plans and
Specifications under which ACLVI's rights under the
Architect's Contract are assigned to Agent Bank on behalf of
Lenders as additional security for the Bank Facilities.
"Assignment of Existing General Contractor's
Agreement" shall mean the Assignment of Existing General
Contractor's Agreement under which ACLVI's rights under the
Existing General Contractor's Agreement are assigned to
Agent Bank on behalf of Lenders as additional security for
the Bank Facilities.
"Assignment of Interior Designer's Contract" shall
mean the Assignment of Interior Designer's Contract with
Plans and Specifications under which ACLVI's rights under
the Interior Designer's Contract are assigned to Agent Bank
on behalf of Lenders as additional security for the Bank
Facilities.
"Assignment of New General Contractor's Agreement"
shall mean the Assignment of New General Contractor's
Agreement under which ACLVI's rights under the New General
Contractor's Agreement are assigned to Agent Bank on behalf
of Lenders as additional security for the Bank Facilities,
the terms of which shall be substantially the same as set
forth in the Assignment of Existing General Contractor's
Agreement.
"Assignments" shall mean collective reference to
the Assignments of Spaceleases, Contracts, Rents and
Revenues, Assignments of Permits, Licenses and Contracts,
Assignment of Architect's Contract, Assignment of Interior
Designer's Contract, Assignment of Existing General
Contractor's Agreement, Assignment of New General
Contractor's Agreement and Major Subcontractor Assignments.
"Assignments of Permits, Licenses and Contracts"
shall mean collective reference to the CPI Assignment of
Permits, Licenses and Contracts, ACLVI Assignment of
Permits, Licenses and Contracts, ACCBI Assignment of
Permits, Licenses and Contracts and ACVI Assignment of
Permits, Licenses and Contracts.
<PAGE> "Assignments of Spaceleases, Contracts, Rents and
Revenues" shall mean collective reference to the CPI
Assignment of Spaceleases, Contracts, Rents and Revenues,
ACLVI Assignment of Spaceleases, Contracts, Rents and
Revenues, ACCBI Assignment of Spaceleases, Contracts, Rents
and Revenues and ACVI Assignment of Spaceleases, 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, Construction Disbursement
Requests, Continuation/ Conversion Notices, Pricing
Certificates, Availability Limit Certificates, Compliance
Certificates, Notices of Swingline Advances and all other
requests, notices, reports, consents, certifications and
authorizations on behalf of Borrowers.
"Availability Determination Date" shall mean the
date upon which Agent Bank receives an Availability Limit
Certificate in accordance with Section 5.08(f) setting forth
the calculation of EBITDA as of the most recently ended
Fiscal Quarter.
"Availability Limit" shall mean three and one-
quarter (3.25) times (x) EBITDA of the Borrower
Consolidation determined as of the end of each Fiscal
Quarter together with the immediately preceding three (3)
Fiscal Quarters on a four (4) Fiscal Quarter basis as set
forth on an Availability Limit Certificate and received by
Agent Bank on each Availability Determination Date.
"Availability Limit Certificate" shall have the
meaning set forth in Section 5.08(f).
"Available Borrowings" shall mean, at any time,
and from time to time, the aggregate amount available to
Borrowers for a Borrowing, Construction Disbursement or a
Swingline Advance not exceeding the amount of the Maximum
Availability, as of each date of determination.
"Bank Facilities" shall mean collective reference
to the Credit Facility, Swingline Facility and Construction
Loan Subfacility.
<PAGE> "Bank Facility Termination" shall mean
indefeasible payment in full of all sums owing under the
Bank Facilities and each of the Loan Documents and the
irrevocable termination of the obligation of Lenders to
advance Borrowings and Construction Disbursements under the
Credit Facility and of Swingline Lender to advance Swingline
Advances under the 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.
"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 on a consolidated basis, without
regard to any other Subsidiaries or Affiliates.
"Borrower Construction Budget" shall mean the line
item breakdown for those Construction Completion Costs of
the ACLVI Project which are not a part of the General
Contractor's Agreement or General Contractor Budget.
"Borrower Construction Expenditures" shall mean
collective reference to the aggregate amount of funds which
<PAGE>may be required to be advanced by Borrowers at any
time and from time to time for payment of the costs and
expenses for construction and development of the ACLVI
Project in accordance with the Project Development Budget,
other than from the Bank Facilities or from third party
purchase money financing.
"Borrowers" shall mean collective reference to
ACI, CPI, ACLVI, ACCBI and ACVI.
"Borrowing(s)" shall mean such amounts as
Borrowers may request from Agent Bank from time to time to
be advanced under the Credit Facility by Notice of Borrowing
in the manner provided in Section 2.03 and/or Construction
Disbursement Request in the manner provided in Section 2.09
or at the request of Agent Bank pursuant to Section 2.08.
"Brady/Lum Estoppel Certificate" shall mean that
certain Acknowledgment and Estoppel Certificate duly
executed by the Brady/Lum Trustee, as lessor, and ACVI, as
lessee, under the Brady/Lum Lease, wherein each certifies
and represents to Agent Bank on behalf of Lenders that
(a) the Brady/Lum Lease represents the entire agreement
between the parties thereto with respect to the Brady/Lum
parcel, (b) the Brady/Lum Lease has not been modified,
supplemented or amended except as described herein, (c) to
the best knowledge of the Brady/Lum Trustee and to the best
knowledge of ACVI there are no defaults presently existing
or continuing under any of the provisions of the Brady/Lum
Lease, and (d) other provisions regarding notice to Agent
Bank on behalf of the Lenders in the event of default
thereunder and Agent Bank's entitlement to the benefit of
certain mortgagee protection provisions which are set forth
by the Brady/Lum Lease.
"Brady/Lum Lease" shall mean that certain
agreement dated December 11, 1992, between the Brady/Lum
Parties, as lessors, and Neilsen, as lessee, a Memorandum of
which was recorded on July 16, 1993, in Deed Book 980, at
Page 830, of the records of the Chancery Clerk of Warren
County, Mississippi, Neilsen's interest thereunder, among
other things, having been assigned to ACVI pursuant to that
certain Assignment of Leasehold and Option to Purchase
recorded in Book 990, at Page 417, of the records of the
Chancery Clerk of Warren County, Mississippi, the interest
of the Brady/Lum Parties under the Brady/Lum Lease having
been conveyed to the Brady/Lum Trustee pursuant to that
certain Deed dated May 15, 1993, recorded in the records of
the Chancery Clerk of Warren County, Mississippi, in Deed
Book 980, at Page 839, and the
<PAGE>Brady/Lum Lease having been amended pursuant to that
First Amendment to Lease Agreement dated as of June 1, 1995,
executed between the Brady/Lum Trustee, as owner, and ACVI,
as tenant, a memorandum of which was recorded on July 5,
1995 in Deed Book 1048, at Page 203, of the records of the
Chancery Clerk of Warren County, Mississippi.
"Brady/Lum Lease Parcel" shall mean the real
property and appurtenances which is the subject of the
Brady/Lum Lease, a description of which is more particularly
described on that certain schedule marked "Schedule B-3",
affixed hereto and by this reference incorporated herein and
made a part hereof.
"Brady/Lum Parties" shall mean collective
reference to Martha Ker Brady Lum, Dorothy W. Brady, James
O. Brady, Jr., Sarah Brady Noble, Anne Brady Baxter and John
B. Brady.
"Brady/Lum Trustee" shall mean Lawrence O.
Branyan, Jr., as trustee of the Brady/Lum Family Trust dated
May 15, 1993.
"Breakage Charges" shall have the meaning set
forth in Section 2.07(c) of the Credit Agreement.
"CPI Assignment of Permits, Licenses and
Contracts" shall mean the assignment to be executed by CPI
as of the Closing Date, pursuant to which CPI assigns to
Agent Bank on behalf of Lenders, as additional security for
the Bank Facilities, all of its right, title and interest in
and to all permits, licenses and contracts relating to the
CPI Hotel/Casino Facilities, except those gaming permits and
licenses which are unassignable and except those permits,
licenses and contracts which may not be assigned without the
consent of CPI's counterparty.
"CPI Assignment of Spaceleases, Contracts, Rents
and Revenues" shall mean the assignment to be executed by
CPI on or before the Closing Date, whereby CPI assigns to
Agent Bank on behalf of Lenders, as additional security for
the Bank Facilities: (a) all of its right, title and
interest under all CPI Spaceleases and CPI Equipment Leases
and Contracts relating to the CPI Hotel/Casino Facilities
and (b) all rents, issues, profits, revenues and income from
the CPI Real Property and the operation of the CPI
Hotel/Casino Facilities and any other business activity
conducted on the CPI Real Property, together with any and
all future expansions thereof, related thereto or used in
connection therewith, as such
<PAGE>assignment may be amended, modified, extended, renewed
or restated from time to time.
"CPI Collateral" shall mean collective reference
to: (i) all of the CPI Real Property, CPI FF&E and the
contract rights, leases, intangibles and other interests of
CPI which are subject to the liens and security interests of
the CPI Security Documents; (ii) all rights of CPI assigned
as additional security pursuant to the terms of the CPI
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
Bank Facilities.
"CPI Deed of Trust" shall mean the Deed of Trust,
Fixture Filing and Security Agreement with Assignment of
Rents to be executed by CPI on or before the Closing Date in
favor of Agent Bank, on behalf of Lenders, for the purpose
of securing the Bank Facilities and Borrowers payment and
performance under each of the Loan Documents (other than the
Environmental Certificate) as such deed of trust may be
amended, modified, extended, renewed or restated from time
to time.
"CPI Equipment Leases and Contracts" shall mean
the executed leases and purchase contracts pertaining to the
CPI FF&E wherein CPI 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.
"CPI 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 or owned by
CPI in connection with the operation of the CPI Hotel/Casino
Facilities.
"CPI Financing Statements" shall mean the Uniform
Commercial Code financing statements to be filed in the
Office of the Secretary of State of the State of Nevada and
in the Office of the County Recorder of Elko County, Nevada,
in order to perfect the security interest granted to Agent
Bank on behalf of Lenders under the CPI Deed of Trust and
other CPI Security Documents in accordance with requirements
of the Nevada Uniform Commercial Code, as such financing
statements may be amended, modified, extended, renewed or
restated from time to time.
<PAGE> "CPI Hotel/Casino Facilities" shall mean the hotel
and casino business and related activities conducted on the
CPI Real Property under the trade names of the Horseshu
Casino and Cactus Pete's Hotel & Casino.
"CPI 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 CPI Hotel/Casino Facilities,
(v) liens created or contemplated by the CPI Security
Documents, (vi) the liens, encumbrances and restrictions on
the CPI Real Property, CPI FF&E and existing improvements
which are shown as exceptions on Schedule B of the CPI Title
Insurance Policy to be issued by 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 CPI FF&E to the extent permitted by
Section 6.08, (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 CPI Real Property or (B) does not interfere in any
material respect with the CPI Hotel/Casino facilities; and
(x) judgment liens, writs, warrants, levies, distraints,
attachments and other similar process which do not
constitute an Event of Default.
"CPI Real Property" shall mean the real property
owned by CPI which is more particularly described on that
certain schedule marked "Schedule C-1", affixed hereto and
by this reference incorporated herein and made a part
hereof.
<PAGE> "CPI Security Documents" shall mean collective
reference to the CPI Deed of Trust, CPI Assignment of
Spaceleases, Contracts, Rents and Revenues, CPI Assignment
of Permits, Licenses and Contracts, the CPI Financing
Statements and all other documents, instruments or
agreements which are executed or delivered by or on behalf
of CPI and accepted by Agent Bank, on behalf of Lenders, as
security for payment of the Bank Facilities.
"CPI Spaceleases" shall mean the executed leases
and concession agreements pertaining to the CPI Hotel/Casino
Facilities, or any portion thereof, wherein CPI 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.
"CPI Title Insurance Policy" shall mean the ALTA
Extended Coverage Lenders Policy of Title Insurance, and the
endorsements thereto, which are to be issued by the Title
Insurance Company, as of the Closing Date, in the amount of
Twenty-Six Million Eight Hundred Thousand Dollars
($26,800,000.00), in favor of Agent Bank, insuring the CPI
Deed of Trust as a first priority mortgage lien encumbering
the CPI Real Property therein described, subject only to the
exceptions shown therein in Schedule B, Part One, together
with such endorsements thereto as are required by Agent Bank
(including, without limitation, a Tie-In endorsement with
regard to the remaining Title Insurance Policies); all in
accordance with the CPI Closing Instructions.
"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
<PAGE>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 net proceeds
(after deducting all reasonable expenses incurred in
connection therewith) available to the Borrower
Consolidation in excess of One Million Dollars
($1,000,000.00) in the aggregate during any Fiscal Year 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 or other disposition of any portion of
the Collateral in 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;
<PAGE> (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, 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 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
<PAGE>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).
"Casino Facility" shall mean individual reference
and "Casino Facilities" shall mean collective reference to
the CPI Hotel/Casino Facilities, ACLVI Hotel/Casino
Facility, the ACCBI Riverboat/Hotel Facilities and the ACVI
Casino Facility.
"Certificate of Occupancy" shall mean a final or
temporary certificate of occupancy issued by the appropriate
<PAGE>Governmental Authorities for the occupancy and use of
the ACLVI Project.
"Change in Control" shall mean the occurrence of
any of the following:
(a) any Person, other than members of the
Neilsen Family Group, owns or controls, more than
fifty percent (50%) of the common voting stock of
ACI; or
(b) ACI fails to own, directly or
indirectly, one hundred percent (100%) of the
capital stock interests of CPI, ACLVI, ACCBI or
ACVI.
"Closing Certificate" shall have the meaning
ascribed to such term in Section 3.05(v).
"Closing Date" shall mean the date upon which: (i)
each condition precedent required under Article IIIA of this
Credit Agreement has been satisfied or waived and (ii) the
Security Documentation has been filed and/or recorded in
accordance with and in the manner required by the Closing
Instructions, or such other date as to which Agent Bank and
Borrower agree in writing.
"Closing Disbursements" shall have the meaning set
forth in Section 2.02(a).
"Closing Instructions" shall mean the Closing
Instructions to be given by Agent Bank to the Title
Insurance Company on or before the Closing Date setting
forth the requirement of Lenders for issuance of the Title
Insurance Policies and other conditions for the occurrence
of the Closing Date.
"Collateral" shall mean: (a) a collective
reference to the CPI Collateral, the ACLVI Collateral, the
ACCBI Collateral, and the ACVI 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 Bank Facilities.
"Collateral Properties" shall mean collective
reference to the real properties, improvements and
associated FF&E which are pledged and encumbered as
Collateral securing
<PAGE>repayment of the Credit Facility from time to time,
which shall consist of the CPI Real Property, ACLVI Real
Property, ACCBI Premises, and ACVI Premises, 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 Bank Facilities.
"Completion Date" shall mean the date upon which:
(a) the ACLVI Project has been completed in substantial
accordance and compliance with the Plans and Specifications
and in accordance and compliance with the terms and
conditions of all Governmental Authorities, (b) the
Occupancy Date has occurred, (c) a Notice of Completion has
been posted with respect to the ACLVI Project and recorded
in the office of the County Recorder of Clark County,
Nevada, the lien period has expired or the liens have been
removed and Title Insurance Company has issued its final
101.6 indorsement to the Title Insurance Policy showing no
liens, claims or encumbrances except those approved by Agent
Bank upon the consent of Requisite Lenders, (d) Borrowers
have obtained all licenses, permits and other authorizations
from all necessary Governmental Authorities for the use and
operation of the ACLVI Project as a part of the ACLVI
Hotel/Casino Facility, and (e) each other condition
applicable to the final release of retainage, as set forth
in Section 9.15, shall have been met, other than with
respect to the completion of "Punch List" items.
"Compliance Certificate" shall mean a compliance
certificate as described in Section 5.08(e) which is more
particularly described on "Exhibit F", affixed hereto and by
this reference incorporated herein and made a part hereof.
"Construction Budgets" shall mean collective
reference to the Project Development Budget, General
Contractors Budget and Borrower Construction Budget.
"Construction Completion Costs" means, as of any
date of determination, an amount equal to the remaining
unpaid costs, including, without limitation all Hard Costs
and Soft Costs, and including retainage, of causing the
ACLVI Project to be completed and opened to the public,
together with all other requirements for the occurrence of
the Completion Date, as determined by Lenders' Consultant
and Agent Bank from time to time.
"Construction Cost Analysis" shall mean the review
and analysis of the Plans and Specifications, General
<PAGE>Contractor Budget, Borrower Construction Budget,
Project Development Budget and all other related
documentation, including, without limitations, the General
Contractor's Agreement, Architect's Contract, subcontracts,
bids and other agreements relating to and necessary for the
construction of the ACLVI Project and occurrence of the
Completion Date, to be made from time to time by Lenders'
Consultant and Agent Bank for the purpose of determining the
Construction Completion Costs as of any date of
determination.
"Construction Disbursement Request" shall mean the
form to be executed and appropriately completed by an
Authorized Officer and submitted to Agent Bank concurrently
with each request for the advance by Lenders of a
Construction Disbursement during the Construction Period, a
copy of which form is marked "Exhibit K", affixed hereto and
by this reference incorporated herein and made a part
hereof.
"Construction Disbursements" shall mean reference
to the proceeds of the Construction Loan Subfacility which
are disbursed for financing the development, furnishing,
equipping and construction of the ACLVI Project in
accordance with the Project Development Budget and as
provided in Article IX.
"Construction Loan Subfacility" shall mean the
agreement of Lenders to make Construction Disbursements
during the Construction Period to Borrowers for construction
and completion of the ACLVI Project in accordance with the
Project Development Budget subject to terms and conditions
set forth in the Credit Agreement.
"Construction Overage" shall have the meaning set
forth in Section 9.07(f) of the Credit Agreement.
"Construction Period" shall mean the period
commencing on the Closing Date and terminating on the
Completion Date.
"Construction Schedule" shall mean the anticipated
time schedule for completion of the ACLVI Project as shown
on a schedule to be delivered to Agent Bank on or before the
Initial Construction Disbursement Date.
"Contingency Reserve" shall have the meaning set
forth in Section 9.06.
"Contingency Transaction Ledger" shall have the
meaning set forth in Section 9.06.
<PAGE> "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. 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,
substantially in the form of that certain exhibit marked
"Exhibit D", 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
<PAGE>basis or conversion of one interest rate basis to
another pursuant to Section 2.05(c).
"Council Bluffs Hotel Associates" shall mean
Council Bluffs Hotel Associates, Inc., an Iowa limited
liability company.
"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 and
Swingline 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 reducing revolving line of credit
(including the Construction Loan Subfacility), 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.
"Deeds of Trust" shall mean collective reference
to the CPI Deed of Trust, ACLVI Deed of Trust, ACCBI Deed of
Trust and ACVI 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 Notice Recording" shall mean either:
(i) the recordation of a notice of default
and election to sell by Agent Bank, on behalf of
Lenders, in the office of the County Recorder of
Elko County or Clark County, Nevada, under which a
non-judicial foreclosure proceeding under NRS
Chapter 107 is initiated by Agent Bank as
beneficiary under either or both of the CPI Deed
of Trust and/or the ACLVI Deed of Trust;
(ii) the commencement of a judicial
foreclosure action in a court of competent
jurisdiction, pursuant to which Lenders or Agent
Bank, on behalf of Lenders, seek judicial
foreclosure under NRS Chapter 106 of either or
both
<PAGE>of the CPI Deed of Trust and/or the ACLVI
Deed of Trust;
(iii) the commencement of a non-judicial or
judicial foreclosure proceeding or action, as
applicable, under either or both of the ACVI Deed
of Trust and/or the ACCBI Mortgage pursuant to
which Lenders or Agent Bank on behalf of Lenders
seek non-judicial foreclosure or a judicial action
in a court of competent jurisdiction for
foreclosure under applicable law of either or both
of the ACVI Deed of Trust and/or ACCBI Mortgage;
or
(iv) commencement of a foreclosure action
pursuant to which Lenders or Agent Bank on behalf
of Lenders seek foreclosure of either or both of
the ACCBI Ship Mortgage and/or the ACVI Ship
Mortgage.
"Default Rate" shall have the meaning set forth in
Section 2.12(b) with respect to defaults occurring under the
Notes 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.
"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 11.14(a).
"Distributions" shall mean and collectively refer
to any and all cash dividends, 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.
<PAGE> "Documents" shall have the meaning set forth in
Section 11.14(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 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.
"Environmental Certificate" shall mean the
Certificate and Indemnification Regarding Hazardous
Substances to be executed by Borrowers on or before the
Closing Date as a further inducement to the Banks to
establish the Bank Facilities, as it may be amended,
modified, extended, renewed or restated from time to time.
"Equipment Leases and Contracts" shall mean
collective reference to the CPI Equipment Leases and
Contracts, ACLVI Equipment Leases and Contracts, ACCBI
<PAGE>Equipment Leases and Contracts, ACVI Equipment Leases
and Contracts.
"Equity Offering" shall mean the issuance and sale
of additional shares of common voting stock by ACI to the
public in exchange for Cash or Cash Equivalents and/or the
issuance and sale of shares of common voting stock of any
Subsidiary of ACI to the public in exchange for Cash or Cash
Equivalents.
"Event of Default" shall mean any event of default
as defined in Section 7.01 hereof.
"Exchange Senior Subordinated Notes" shall have
the meaning set forth in Recital E.
"Existing Bank Loan" shall have the meaning
ascribed to such term in Recital Paragraph B.
"Existing Bank Loan Security Documents" shall mean
collective reference to all pledges, security agreements,
mortgages, deeds of trust, financing statements, ship
mortgages and other documents and instruments securing
repayment of the Existing Bank Loans, including, without
limitation, those documents and instruments set forth on the
Schedule of Existing Bank Loan Security Documents marked
"Schedule 3.11(a), affixed hereto and by this reference
incorporated herein and made a part hereof.
"Existing Credit Agreement" shall have the meaning
ascribed to such term in Recital Paragraph B.
"Existing Equipment Intercreditor Agreement" shall
mean that certain letter agreement dated December 12, 1995,
executed by and among ACI, the ACCBI Equipment Lender and
First Interstate Bank of Nevada, N.A., as agent for the
Existing Lenders, providing for the relative priority in
right to payment as between the parties thereto upon
liquidation of the equipment and other collateral securing
repayment of the ACCBI Equipment Loan and the ACCBI
Riverboat in the event of foreclosure of the ACCBI Equipment
Ship Mortgage and/or the ship mortgages securing repayment
of the Existing Bank Loan and ACCBI's guarantee thereof.
"Existing GECC Intercreditor Agreement" shall mean
the Subordination and Intercreditor Agreement dated
December 28, 1995, executed by and among GECC, First
Interstate Bank of Nevada, N.A., as agent for Existing
<PAGE>Lenders, ACCBI Equipment Lender, ACCBI and ACI, for
the purposes of: (i) affirming the subordination of the
ACCBI Equipment Ship Mortgage and the ship mortgages
securing repayment of the Existing Bank Loan and ACCBI's
guarantee thereof to the GECC Ship Mortgage; and
(ii) providing for the relative priority in right to payment
as between GECC, on the one hand, and the ACCBI Equipment
Lender and the holders of the ship mortgages securing
repayment of the Existing Bank Loan and ACCBI's guarantee
thereof, on the other hand, in the event of foreclosure of
the GECC Ship Mortgage, ACCBI Equipment Ship Mortgage and/or
the ship mortgages securing repayment of the Existing Bank
Loan and ACCBI's guarantee thereof.
"Existing General Contractor's Agreement" shall
mean collective reference to the Standard Form of Agreement
Between Owner and Contractor for the Hotel, dated
October 25, 1995, and the Standard Form of Agreement Between
Owner and Contractor for the Casino, dated October 25, 1995,
each of which is entered into by and between ACLVI (as the
successor by merger to Gem pursuant to the Gem Merger) and
General Contractor for the construction of the structural
and exterior components of the ACLVI Project, subject to
additions and deductions as provided in the Contract
Documents, as therein defined, and consistent with the
Project Development Budget.
"Existing General Contractor's Consent" shall mean
that certain Contractor's Consent and Agreement which is to
be executed by the General Contractor and delivered to Agent
Bank, on behalf of the Lenders, prior to the Initial
Construction Disbursement, for the purpose, among other
things, of evidencing the General Contractor's: (i) consent
to the Assignment of Existing General Contractor's
Agreement; (ii) agreement not to modify the Existing General
Contractor's Agreement without Agent Bank's consent; and
(iii) agreement to continue performance under the Existing
General Contractor's Agreement on behalf of Agent Bank
subject to the terms and conditions set forth therein.
"Existing Intercompany Security Documents" shall
mean collective reference to all pledges, security
agreements, mortgages, deeds of trust, financing statements,
ship mortgages and other documents and instruments securing
repayment of any and all loans, advances and extensions of
credit as between or amongst members of the Borrower
Consolidation, including, without limitation, those
documents and instruments set forth on the Schedule of
Existing Intercompany Security Documents marked
"Schedule 3.11(b)",
<PAGE>affixed hereto and by this reference incorporated
herein and made a part hereof.
"Existing Lender(s)" shall have the meaning
ascribed to such term in Recital Paragraph B.
"Existing Note" shall have the meaning ascribed to
such term in Recital Paragraph B.
"FF&E" shall mean reference to the CPI FF&E, the
ACLVI FF&E, ACCBI FF&E and the ACVI 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 Casino
Facilities.
"FIRREA" shall mean the Financial Institutions
Reform, Recovery and Enforcement Act of 1989.
"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 Side Letter of
Understanding Regarding Fees to be executed by and between
Borrowers and Agent Bank on or before the Closing Date
<PAGE>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 CPI Financing Statements, ACLVI Financing
Statements, ACCBI Financing Statements and ACVI 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 Aggregate Outstandings for such period, plus the total
as of the last day of such period of both the long-term and
current portions (without duplication) of all other
Indebtedness and Capitalized Lease Liabilities, but
excluding the Indebtedness evidenced by the Gem Settlement
Notes.
"Funded Outstandings" shall mean the unpaid
principal amount outstanding on the Credit Facility as of
any given date of determination for Borrowings and
Construction Disbursements made thereunder, but not
including Swingline Outstandings.
"Funding Date" shall mean each date upon which
Lenders fund Borrowings or Construction Disbursements
requested by Borrowers in accordance with the provisions of
Section 2.03 or at the request of Agent Bank pursuant to
Section 2.08.
"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
<PAGE>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.
"GECC" shall mean General Electric Capital
Corporation.
"GECC Ship Mortgage" shall mean the Preferred Ship
Mortgage executed by ACCBI in favor of GECC, received by the
USCG, New Orleans office, on December 29, 1995, and recorded
in the NVDC in Book 95-7, as Instrument No. 793.
"GECC Ship Note" shall mean that certain
Promissory Note dated December 28, 1995, in the original
principal amount of Eleven Million Five Hundred Eleven
Thousand Dollars ($11,511,000.00), executed by ACCBI,
payable to the order of GECC, which is secured by the GECC
Ship Mortgage.
"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, Mississippi Gaming Authorities and Iowa
Gaming Authorities, with authority to regulate any gaming
operation (or proposed 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 Mississippi Gaming
Control Act, the Iowa Gaming Control Act and the Nevada
Gaming Control 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 Casino Facilities.
<PAGE> "Gem" shall mean Gem Gaming, Inc., a Nevada
corporation, which was merged into ACLVI pursuant to the Gem
Merger.
"Gem Merger" shall have the meaning ascribed to
such term in Recital Paragraph C.
"Gem Merger Agreement" shall have the meaning
ascribed to such term in Recital Paragraph C.
"Gem Settlement Agreement" shall mean that certain
Settlement Agreement made as of May 3, 1997, as amended by a
First Amendment to Settlement Agreement dated June 2, 1997,
each executed by and among ACI, ACLVI, Rebeil, Magliarditi
and other parties more particularly therein named for the
purpose of resolving various issues and claims and
considerations to be paid to Rebeil and Magliarditi by ACI
to conclude the Gem Merger, all subject to approval by the
Nevada Gaming Authorities.
"Gem Settlement Effective Date" shall have the
meaning ascribed to the term "Effective Date" in the Gem
Settlement Agreement.
"Gem Settlement Notes" shall mean collective
reference to the Rebeil Notes and the Magliarditi Notes.
"General Contractor" shall mean Camco Pacific
Construction Company, Inc. with respect to the Existing
General Contractor's Agreement and either Camco Pacific
Construction Company, Inc. or such other general contractor
which is licensed in the State of Nevada and approved by
Agent Bank with respect to the New General Contractor's
Agreement, in each case engaged by ACLVI for construction of
the structural and exterior components of the ACLVI Project.
"General Contractor Budget" shall mean the line
item breakdown for construction costs, materials, labor and
other payments to be made under the General Contractor's
Agreement, together with all amendments, revisions and
modifications thereto.
"General Contractor's Agreement" shall mean
collective reference to the Existing General Contractor's
Agreement and the New General Contractor's Agreement.
"Government Securities" means readily marketable
(a) direct full faith and credit obligations of the United
<PAGE>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 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 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.
"Gross Fixed Charge Coverage Ratio" as of the end
of any Fiscal Quarter shall mean with reference to the
Borrower Consolidation:
The sum of EBITDA during the Fiscal
Quarter under review, plus EBITDA during
each of the most recently ended three
(3) preceding Fiscal Quarters,
Divided by ()
The sum of: (i) the aggregate amount of actually
paid Interest Expense, plus (ii) the aggregate of
Scheduled Reductions, plus (iii) the aggregate of
actual principal payments made on the Gem
Settlement Notes, plus (iv) principal payments or
reductions (without duplication) required to be
made on all other Indebtedness, plus (v) the
current portion of Capitalized Lease Liabilities
to the extent not included in (i) above; in each
case of (i) through (v) determined for the Fiscal
Quarter under review together with the most
recently ended three (3) preceding Fiscal
Quarters.
"Gross Gaming Revenues" shall mean all income and
revenues of a Borrower, or a Casino Facility, as the context
may require, which are subject to taxation by a Gaming
Authority.
"Hard Costs" shall mean those costs which are
shown in the Construction Budgets as a "construction cost"
and any
<PAGE>adjustments to such costs pursuant to properly
approved change orders.
"Hazardous Materials Laws" shall have the meaning
set forth in Section 5.21.
"IDNR" shall mean the Iowa Department of Natural
Resources.
"IDNR Parcel" shall mean the real property which
is the subject of the ACCBI Land Use Agreement, more
particularly described on that certain schedule marked
"Schedule A-2", affixed hereto and by this reference
incorporated herein and made a part hereof.
"Indebtedness" of any Person includes all obliga
tions, 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.
"Indenture" shall have the meaning set forth in
Recital D.
"Initial Construction Disbursement" shall mean the
first Construction Disbursement to be made by Lenders to
Borrowers pursuant to the Construction Loan Subfacility.
"Initial Construction Disbursement Date" shall
mean the date upon which Borrowers request Lenders to fund
the Initial Construction Disbursement.
"Initial Senior Subordinated Notes" shall have the
meaning set forth in Recital D.
<PAGE> "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.
"Interior Designer" shall mean H.C. Designs, Inc.,
who has been engaged by ACLVI for the purpose of preparing
the Interior Plans and Specifications for the construction
of the interior components, equipment and furnishings of the
ACLVI Project.
"Interior Designer's Consent" shall mean that
certain Interior Designer's Consent and Agreement which is
to be executed by the Interior Designer and delivered to
Agent Bank, on behalf of the Lenders, prior to the initial
Construction Disbursement, for the purpose, among other
things, of evidencing the Interior Designer's: (i) consent
to
<PAGE>Assignment of Interior Designer's Contract;
(ii) agreement not to modify the Interior Designer's
Contract without Agent Bank's consent; and (iii) agreement
to continue performance under the Interior Designer's
Contract on behalf of Agent Bank subject to the terms and
conditions set forth therein.
"Interior Designer's Contract" shall mean the
Letter of Agreement executed or to be executed by and
between Interior Designer and ACLVI under the terms of which
Interior Designer agrees to provide design and consulting
services in connection with the interior components,
equipment and furnishings of the ACLVI Project, including,
but not limited to, preparation of the Interior Plans and
Specifications.
"Interior Plans and Specifications" shall mean the
plans and specifications for the development and
construction of the interior components of the ACLVI Project
and for equipping and furnishing the ACLVI Project prepared
by the Interior Designer and the Interior Designer's
consultants, as such plans and specifications may be amended
from time to time. Said plans and specifications shall
include, but not be limited to, all plans, layouts sketches,
diagrams, elevations, drawings, specifications, lists, and
all other reports, data and plans prepared by the Interior
Designer and the Interior Designer's consultants in
connection with the interior components, equipment and
furnishing of the ACLVI Project.
"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.
"Iowa Gaming Authorities" shall mean, without
limitation, the Iowa Racing and Gaming Commission and any
other applicable governmental or administrative state or
local agency involved in the regulation of gaming and gaming
activities conducted by any member of the Borrower
Consolidation in the State of Iowa.
"Koch" shall mean Koch Fuels, Inc., a Delaware
corporation.
<PAGE> "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
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 9:00 A.M. San Francisco 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 Loan Interest Period" shall mean each
portion of the Credit Facility bearing interest with
reference to a LIBO Rate which shall in each instance be
fixed for either a one (1), two (2), three (3) or six (6)
month period.
"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,
<PAGE>treaties, rules, regulations, ordinances, codes and
administrative or judicial precedents.
"Lender Reply Period" shall have the meaning set
forth in Section 10.10(d).
"Lenders" means WFB and any other bank, finance
company, insurance or other financial institution which is
or becomes a party to this Credit Agreement by execution of
a counterpart signature page hereto or an Assignment and
Assumption Agreement, as assignee. 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".
"Lenders' Consultant" shall mean the architectural
or engineering firm of Agent Bank's choice and/or affiliate
of Agent Bank to be engaged by Agent Bank in connection with
the construction and development of the ACLVI Project
pursuant to the Lenders' Consultant Contract at the expense
of Borrowers after having been first reasonably approved by
Borrowers.
"Lenders' Consultant Contract" shall mean the
agreement or agreements to be executed by and between Agent
Bank and Lenders' Consultant for the purpose set forth
herein, including, without limitation:
(a) An examination of the Plans and
Specifications, structural engineering
calculations, and geotechnical report to ascertain
completeness and acceptability of documentation
relating to the ACLVI Project and to determine
that the individual elements of documentation are
not contradictory.
(b) Periodic site inspections of the ACLVI
Project to ascertain that:
(i) Percentage of construction
completed and/or percentage of acceptably-stored
materials are in accordance with percentages
specified on the payment request document (AIA
form G-702 or a form substantially similar thereto
which has been first approved by Agent Bank);
<PAGE> (ii) the ACLVI Project is in compliance
with governing construction documentation, ie.,
plans, specifications, engineering calculations,
geotechnical recommendations, approved change
orders, etc.
(c) A review of change orders which will
physically affect the ACLVI Project. This review
will be inclusive of budgetary aspects, including
Construction Cost Analysis from time to time, as
well as physical/structural acceptability.
"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 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
Swingline 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 Bank Facilities for the benefit of Banks or Agent
Bank on behalf of the Lenders.
"Magliarditi" shall have the meaning set forth in
Recital Paragraph C.
<PAGE> "Magliarditi Notes" shall mean collective
reference to the Magliarditi Negotiable Note and the
Magliarditi Non-Negotiable Note, as defined in and in the
form attached to the Gem Settlement Agreement.
"Magnolia" shall mean Magnolia Hotel Company, a
Mississippi corporation.
"Magnolia Estoppel Certificate" shall mean the
Acknowledgement and Estoppel Certificate duly executed by
Magnolia, as lessor, and ACVI, as lessee, under the Magnolia
Lease, wherein each certifies and represents to Agent Bank
on behalf of Lenders that: (a) the Magnolia Lease represents
the entire agreement between the parties thereto with
respect to the Magnolia Parcel, (b) the Magnolia Lease has
not been modified, supplemented or amended except as
described herein, (c) to the best knowledge of Magnolia and
to the best knowledge of ACVI, there are no defaults
presently existing or continuing under any of the provisions
of the Magnolia Lease, and (d) other provisions regarding
Notice to Agent Bank on behalf of Lenders in the event of
default thereunder, and Agent Bank's entitlement to the
benefit of certain mortgagee protection provisions which are
set forth by the Magnolia Lease.
"Magnolia Lease" shall mean that certain agreement
dated September 8, 1992, executed between Magnolia, as
lessor, and Neilsen, as lessee, a Memorandum of which was
recorded in Deed Book 956, at Page 699, of the records of
the Chancery Clerk of Warren County, Mississippi, and a
restatement of which dated April 29, 1993, was recorded in
Deed Book 976, at Page 221 of the Records of the Chancery
Clerk of Warren County, Mississippi. Neilsen's interest
under the Magnolia Lease, among other things, was assigned
to ACVI pursuant to Assignment of Leasehold and Option to
Purchase recorded in Deed Book 990, at Page 410 of the
Records of the Chancery Clerk of Warren County, Mississippi,
and was further amended by First Amendment to Lease
Agreement dated as of July 14, 1993, executed between
Magnolia, as owner, and Neilsen, as tenant, a Memorandum of
which was recorded in Deed Book 980, at Page 770, of the
records of the Chancery Clerk of Warren County, Mississippi,
and was further amended by Second Amendment to Lease
Agreement dated as of June 1, 1995, between Magnolia, as
owner, and ACVI, as tenant, a Memorandum of which was
recorded in Deed Book 1048, at Page 181, of the records of
the Chancery Clerk of Warren County, Mississippi.
<PAGE> "Magnolia Parcel" shall mean the real property
which is the subject of the Magnolia Lease, a description of
which is more particularly described on that certain
schedule marked "Schedule B-2", affixed hereto and by this
reference incorporated herein and made a part hereof.
"Major Subcontractor Assignments" shall mean
collective reference to the assignments of the Assigned
Major Subcontracts which are required to be executed by
ACLVI and delivered to Agent Bank under Section 5.27(b).
"Major Subcontractor Consents" shall mean
collective reference to the consents to be executed by each
Major Subcontractor that is a party to an Assigned Major
Subcontract as required under Section 5.27(b).
"Major Subcontracts" shall mean all contracts or
subcontracts executed by a Subcontractor and either ACLVI
General Contractor or another Subcontractor in connection
with the ACLVI Project if the aggregate amount of such
contracts or subcontracts executed by such Subcontractor is
equal to or greater than One Hundred Thousand Dollars
($100,000.00).
"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 any change
which is material and adverse to the Collateral or the
condition (financial or otherwise), business operations or
prospects of: (a) any of the Borrowers, or (b) the Borrower
Consolidation, or (c) the ability of Borrowers to perform
their respective obligations under the Loan Documents or the
ability of any of the Lenders to enforce any of their rights
or remedies under any of the Loan Documents..
"Material Adverse Effect" means (i) a material
adverse effect upon (a) the business, operations,
properties, assets, condition (financial or otherwise) or
prospects of any Borrower or any of such Borrower's
Subsidiaries, (b) the value of the ACCBI Riverboat/Hotel
Facilities, the ACLVI Hotel/Casino Facility, the ACVI Casino
Facility or the CPI Hotel/Casino Facilities, (c) the
validity, priority or enforceability of any of the Loan
Documents, or (d) the construction, use, occupancy or
operation of the ACLVI Project or the use, occupancy or
operation of the ACCBI Riverboat/Hotel Facilities, the ACVI
Casino Facility or the CPI Hotel/Casino Facilities or, in
each case, any part thereof
<PAGE>or (ii) the impairment of the ability of any Borrower
to perform, or of Agent Bank or Lenders to enforce, the
Obligations in any material respect.
"Material Adverse Event" shall mean any event or
change which is material and adverse to the Casino
Facilities, the Collateral or the financial condition or
business operations of the Borrower Consolidation.
"Maturity Date" shall mean June 30, 2003.
"Maximum Availability" shall mean the Maximum
Permitted Balance less the Aggregate Outstandings.
"Maximum Permitted Balance" shall mean the maximum
amount of Aggregate Outstandings which may be outstanding on
the Bank Facilities from time to time which shall be the
lesser of: (a) the Maximum Scheduled Balance, or (b) the
amount to which the Maximum Scheduled Balance is voluntarily
reduced by Borrowers pursuant to Section 2.01(c) or is
otherwise reduced or limited pursuant to Sections 2.01(d),
5.01, 5.12 or 8.02 or by Scheduled Reductions, and, during
the Construction Period, by the amount of undisbursed
Retainage.
"Maximum Scheduled Balance" shall mean the maximum
amount of scheduled principal which may be outstanding on
the Credit Facility from time to time as set forth on the
Aggregate Commitment Reduction Schedule.
"Mississippi Gaming Authorities" means, without
limitation, the Mississippi Gaming Commission and any other
applicable governmental or administrative state or local
agency involved in the regulation of gaming and gaming
activities conducted by any member of the Borrower
Consolidation in the State of Mississippi.
"Morrison" shall mean R.R. Morrison and Son, Inc.,
a Mississippi corporation.
"Morrison Estoppel Certificate" shall mean the
Acknowledgement and Estoppel Certificate duly executed by
Morrison, as lessor, and ACVI, as lessee, under the Morrison
Lease, wherein each certifies and represents to Agent Bank
on behalf of Lenders that: (a) the Morrison Lease represents
the entire agreement between the parties thereto with
respect to the Morrison Parcel, (b) the Morrison Lease has
not been modified, supplemented or amended except as
described herein, (c) to the best knowledge of Morrison and
to the best
<PAGE>knowledge of ACVI, there are no defaults presently
existing or continuing under any of the provisions of the
Morrison Lease, and (d) other provisions regarding notice to
Agent Bank on behalf of Lenders in the event of default
thereunder and Agent Bank's entitlement to the benefit of
certain mortgagee protection provisions which are set forth
by the Morrison Lease.
"Morrison Lease" shall mean that certain Agreement
dated September 18, 1992, between R.R. Morrison, Jr., as
lessor, and Neilsen, as lessee, a Memorandum of which was
recorded on May 24, 1993, in Deed Book 976, at Page 217, of
the records of the Chancery Clerk of Warren County,
Mississippi, as was ratified by Morrison, as the successor
to R.R. Morrison, Jr., pursuant to Ratification of Lease
dated September 18, 1992, executed between Morrison and
ACVI, recorded in the Official Records on October 6, 1993,
in Book 990, Page 434, as Instrument No. 089117, Neilsen's
interest under the Morrison Lease, among other things, was
assigned to ACVI pursuant to that certain Assignment of
Leasehold and Option to Purchase recorded in Deed Book 990,
at Page 427, of the records of the Chancery Clerk of Warren
County, Mississippi, and such lease was amended pursuant to
that certain First Amendment to Lease Agreement dated as of
June 1, 1995, between Morrison, as owner, and ACVI, as
tenant, recorded in Deed Book 1048, at Page 216, of the
records of the Chancery Clerk of Warren County, Mississippi.
"Morrison Lease Parcel" shall mean the real
property and appurtenances which are the subject of the
Morrison Lease, a description of which is more particularly
described on that certain schedule marked "Schedule B-4",
affixed hereto and by this reference incorporated herein and
made a part hereof.
"NVDC" shall mean the National Vessel
Documentation Center of the USCG.
"Neilsen" shall mean Craig Neilsen.
"Neilsen Family Group" shall mean collective
reference to: (i) Neilsen and his executors, administrators,
testamentary trustees, heirs, legatees and beneficiaries,
and (ii) Neilsen as the trustee of the Trust created under
the Last Will and Testament of Ray Neilsen dated October 9,
1963, together with each successor trustee thereof.
<PAGE> "Net Income" shall mean with respect to any Person
for any fiscal period, the net income of such Person during
such fiscal period determined in accordance with GAAP.
"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 ACI
and its subsidiaries in the State of Nevada.
"New General Contractor's Agreement" shall mean
two construction contracts to be entered into by and between
ACLVI and General Contractor for the construction of those
portions of the structural and exterior components of the
ACLVI Project which are not part of the Existing General
Contractor's Agreement, subject to the additions and
deductions as provided therein, and consistent with the
Project Development Budget.
"New General Contractor's Consent" shall mean a
Contractor's Consent and Agreement, the terms of which shall
be substantially the same as set forth in the Existing
General Contractor's Consent, which is to be executed by the
General Contractor and delivered to Agent Bank, on behalf of
the Lenders, prior to the Closing Date, for the purpose,
among other things, of evidencing the General Contractor's:
(i) consent to the Assignment of New General Contractor's
Agreement; (ii) agreement not to modify the New General
Contractor's Agreement without Agent Bank's consent; and
(iii) agreement to continue performance under the New
General Contractor's Agreement on behalf of Agent Bank
subject to the terms and conditions set forth therein.
"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.
"Nonusage Fee" shall have the meaning ascribed to
such term in Section 2.10(b) 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.
<PAGE> "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 or any other Loan Document, 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.
"Occupancy Date" shall mean the date upon which
the City of Henderson issues a final or temporary
Certificate of Occupancy for the use and occupancy of all of
the public areas and hotel rooms of the ACLVI Project.
"Option Agreement" shall mean that certain Option
Agreement dated July 11, 1995, between Levy Realty Trust, as
the optionor, and ACLVI (as the successor by merger to Gem),
as optionee, under the terms of which ACLVI acquired the
exclusive option to purchase the Option Property in minimum
five (5) acre increments for the purchase price and subject
to the terms therein contained, which Option Agreement was
recorded in the Official Records of Clark County, Nevada, on
July 11, 1996, in Book 960711, as Instrument No. 00964.
"Option Disbursement" shall mean a Construction
Disbursement during the Construction Period or a Borrowing
during the Revolving Credit Period which is used for the
purpose of funding the acquisition cost of portions of the
Option Property.
<PAGE> "Option Property" shall mean the real property
located in Clark County, Nevada, which is the subject of the
Option Agreement, which real property is more particularly
described on that certain schedule marked "Schedule D-2",
affixed hereto and by this reference incorporated herein and
made a part hereof.
"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.
"Permitted Encumbrances" shall mean collective
reference to the CPI Permitted Encumbrances, the ACLVI
Permitted Encumbrances, the ACCBI Permitted Encumbrances and
the ACVI Permitted Encumbrances.
"Person" means an individual, firm, corporation,
limited liability company, trust, association, partnership,
joint venture, tribunal or other entity.
"Plans and Specifications" shall mean collective
reference to the Structural Plans and Specifications, the
Interior Plans and Specifications and all other plans and
specifications which are approved by Agent Bank in
connection with the construction and development of the
ACLVI Project, together with all additions, changes and
amendments thereto which are first approved by Agent Bank.
"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 10.11(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
<PAGE>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.
"Project Development Budget" shall mean the
detailed line item budget, a copy of which is marked
"Exhibit N", affixed hereto and by this reference
incorporated herein and made a part hereof, showing in
detail to the satisfaction of Agent Bank and each of the
Lenders the anticipated costs of the developing,
constructing, furnishing and equipping the ACLVI Project,
including the cost of gaming devices, slot machines and
other ACLVI FF&E to be used in connection therewith and
including all items shown on the General Contractor's Budget
and Borrower Construction Budget.
"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 11.20 or post-
foreclosure ownership, maintenance, operation or marketing
of any Collateral.
"Qualified Appraisal" shall mean reference to an
appraisal or appraisals of the 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,
1997.
<PAGE> "Rebeil" shall have the meaning set forth in
Recital Paragraph C.
"Rebeil Notes" shall mean collective reference to
the Rebeil Negotiable Note and the Rebeil Non-Negotiable
Note, as defined in and in the form attached to the Gem
Settlement Agreement.
"Reduction Date(s)" shall mean reference to each
date or the dates, as the context may require upon which the
Maximum Scheduled Balance is reduced by a Scheduled
Reduction as set forth on the Aggregate Commitment Reduction
Schedule.
"Related Entities" shall mean collective reference
to all stockholders, employees, Affiliates and Subsidiaries
of the Borrowers, or any of them, other than another
Borrower.
"Related Receivables" shall mean the aggregate
amount of all accounts receivable, notes receivable,
obligations, debts and other sums owing to Borrowers, or any
of them, from Related Entities.
"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 sixty-six and two-thirds percent (66-2/3%) 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 sixty-six and
two-thirds percent (66-2/3%) 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.
<PAGE> "Restated Equipment Intercreditor Agreement" shall
mean an agreement or restatement of the Existing Equipment
Intercreditor Agreement to be executed by and between the
ACCBI Equipment Lender and Agent Bank, for the purposes of:
(i) evidencing the ACCBI Equipment Lender's consent to the
encumbrance of the ACCBI Riverboat with the ACCBI Ship
Mortgage, and (ii) providing for the relative priority in
right to payment as between the ACCBI Equipment Lender, on
the one hand, and Agent Bank, on the other hand, in the
event of foreclosure of the ACCBI Equipment Ship Mortgage
and/or ACCBI Ship Mortgage, the terms of which shall be
substantially the same as set forth in the Existing
Equipment Intercreditor Agreement and otherwise as approved
by Lenders.
"Restated GECC Intercreditor Agreement" shall mean
a Subordination and Intercreditor Agreement or an amendment
to or restatement of the Existing GECC Intercreditor
Agreement to be executed by and among GECC, ACCBI Equipment
Lender and Agent Bank on or before the Closing Date, for the
purposes of: (i) evidencing GECC's consent to the
encumbrance of the ACCBI Riverboat with the ACCBI Ship
Mortgage, and (ii) providing for the relative priority in
right to payment as between GECC, on the one hand, and the
ACCBI Equipment Lender and Agent Bank, on the other hand, in
the event of foreclosure of the GECC Ship Mortgage, ACCBI
Equipment Ship Mortgage and/or ACCBI Ship Mortgage, the
terms of which shall be substantially the same as set forth
in the Existing GECC Intercreditor Agreement and otherwise
as approved by Lenders.
"Retainage" shall have the meaning ascribed to
such term in Section 9.15.
"Revolving Credit Note" shall mean the 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.
"Revolving Credit Period" shall mean the period
commencing on the Completion Date and terminating on the
Maturity 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
<PAGE>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.
"Scheduled Reductions" shall mean the amount by
which the Aggregate Commitment is reduced on each Reduction
Date as set forth on the Aggregate Commitment Reduction
Schedule.
"Second Determination Date" shall have the meaning
set forth in Section 2.01(d)(ii) of the Credit Agreement.
"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 Documentation" shall mean a collective
reference to the CPI Security Documents, the ACLVI Security
Documents, the ACCBI Security Documents, the ACVI Security
Documents and Stock Pledge, 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 Bank Facilities.
"Senior Subordinated Notes" shall mean at any time
the issued and outstanding Initial Senior Subordinated Notes
and/or the Exchange Senior Notes, as the case may be;
provided, however, that at no time may the aggregate
principal amount of outstanding Senior Subordinated Notes
exceed One Hundred Twenty-Five Million Dollars
($125,000,000.00).
"Senior Subordinated Notes Effective Date" shall
mean the date upon which the Initial Senior Subordinated
Notes shall have been issued by ACI and ACI shall have
received the proceeds thereof, net of any discounts and any
other amounts due to the initial purchasers or third parties
in connection with offering and issuance of the Initial
Senior Subordinated Notes.
<PAGE> "Significant Litigation" shall mean each action,
suit, proceeding, litigation and controversy involving
Borrowers, or any of them, involving claims in excess of One
Million Dollars ($1,000,000.00) or which if determined
adverse to the interests of Borrowers, or any of them, could
have a Material Adverse Effect.
"Soft Costs" shall mean all costs which are shown
in the Construction Budgets, other than Hard Costs,
including, without limitation, the purchase of ACLVI FF&E
and other items outside the scope of the General
Contractor's Agreement.
"Spaceleases" shall mean collective reference to
the CPI Spaceleases, ACLVI Spaceleases, ACCBI Spaceleases
and ACVI Spaceleases.
"Stock Pledges" shall mean collective reference to
the Security Agreements and Stock Pledges to be executed and
delivered into escrow on behalf of the Banks as of the
Closing Date, pursuant to which, subject to the prior
approval of all necessary Gaming Authorities, the stock of
CPI, ACLVI, ACCBI and ACVI is pledged by ACI to Agent Bank
on behalf of Lenders as security for the Bank Facilities and
all other sums which may be owing by Borrowers to the Banks
from time to time under the terms of the Credit Agreement.
"Structural Plans and Specifications" shall mean
the plans and specifications for the development and
construction of the structural and exterior components of
the ACLVI Project prepared by the Architect and the
Architect's consultants, as such plans and specifications
may be amended from time to time. Said plans and
specifications shall include, but not be limited to, all
plans, maps, sketches, diagrams, surveys, drawings,
specifications, lists, geotechnical reports, structural
engineering calculations and all other engineering reports,
data and plans prepared by the Architect and the Architect's
consultants in connection with the structural and exterior
components of the ACLVI Project.
"Subcontractor(s)" means any person(s) or firm(s),
other than an employee of the General Contractor, who is
engaged by the General Contractor, ACLVI or by another
Subcontractor to furnish labor, material, analysis or other
services with respect to a portion of the work, labor,
materials and services to be provided: (i) for General
Contractor under the General Contractor's Agreement, or
(ii) for ACLVI or another Subcontractor for work, labor,
<PAGE>materials and services not included in the General
Contractor's Agreement.
"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 contin
gencies, 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.
"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 B", 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.
"Swingline Outstandings" shall mean the aggregate
amount of all outstanding and unpaid Swingline Advances as
of each date of determination.
"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.
<PAGE> "Tangible Net Worth" shall mean ACI stockholder's
equity, minus the aggregate value of ACI treasury stock,
less Intangibles, less Related Receivables.
"Title Insurance Company" shall mean Stewart Title
Guaranty Company.
"Title Insurance Policies" shall mean collective
reference to the ACCBI Title Insurance Policy, ACLVI Title
Insurance Company, ACVI Title Insurance Company and CPI
Title Insurance Company.
"Trademark Security Agreement" shall mean the
security agreement to be executed by Borrowers as of the
Closing Date 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.
"Trustmark Nondisturbance Agreement" shall mean
that certain Nondisturbance Agreement to be executed on or
before the Closing Date by and between ACVI and Trustmark
National Bank ("Trustmark") as the holder of a deed of trust
encumbering the fee interest in the Magnolia Parcel pursuant
to which, among other things, Trustmark agrees that, upon
acquisition of the Magnolia Parcel by foreclosure under its
deed of trust, or conveyance in lieu thereof, Trustmark (or
any purchaser at such a foreclosure sale) will recognize and
will not disturb the interest of ACVI under the Magnolia
Lease, or the interest of any party acquiring ACVI's
interest under the Magnolia Lease pursuant to foreclosure
under the ACVI Deed of Trust or conveyance in lieu thereof.
"USCG" shall mean the United States Coast Guard.
"Vessels" shall mean collective reference to the
ACCBI Riverboat and the ACVI Riverboat.
"Voluntary Reduction" shall have the meaning set
forth in Section 2.01(c).
"WFB" shall mean Wells Fargo Bank, National
Association.
<PAGE> "WFB Loan" shall mean that certain unsecured loan
which was advanced to ACI by WFB, in the principal amount of
Twenty Million Dollars ($20,000,000.00), the terms of
repayment of which is evidenced by that certain Unsecured
Promissory Note dated as of March 26, 1997, executed by ACI,
payable to the order of WFB in the principal amount of
Twenty Million Dollars ($20,000,000.00), together with
interest at the rate or rates therein specified.
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
<PAGE>"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, 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 Notes 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
<PAGE>originally existing or as the same may from time to
time be supplemented, modified or amended, are incorporated
herein by this reference.
ARTICLE II
AMOUNT, TERMS AND SECURITY OF THE BANK FACILITIES
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, the Closing Disbursements on
the Closing Date and such amounts as Borrowers may request
by: (i) Notice of Borrowing duly executed by an Authorized
Officer and delivered to Agent Bank from time to time during
the Revolving Credit Period as provided in Section 2.03,
subject to the uses and purposes set forth in Section 2.02,
and (ii) Construction Disbursement Request during the
Construction Period duly executed by an Authorized Officer
and delivered to Agent Bank from time to time, together with
all other requirements as provided in Section 2.09 and
Article IX.
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 Borrowings up
to the Available Borrowings 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. 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. Notwithstanding the Scheduled Reductions
to the Maximum Permitted Balance as set forth on the
Aggregate Commitment Reduction Schedule, Borrowers may
voluntarily further reduce the Maximum Permitted Balance
from time to time (a "Voluntary Reduction") on the following
conditions:
(i) that each such Voluntary Reduction
be in the minimum amount of Ten Million Dollars
($10,000,000.00) and made in writing by an
<PAGE>Authorized Officer, effective on the fifth
(5th) Banking Business Day following receipt by
Agent Bank;
(ii) that each such Voluntary Reduction
shall be irrevocable and a permanent reduction to
the Maximum Permitted Balance; and
(iii) no Voluntary Reduction of the
Maximum Permitted Balance shall relieve or
otherwise defer the making of each Scheduled
Reduction on each Reduction Date, it being
understood that each Scheduled Reduction shall be
made on each Reduction Date to the Maximum
Permitted Balance as it may be reduced by each
Voluntary Reduction.
d. Notwithstanding anything herein
contained to the contrary, the Maximum Permitted Balance
shall be limited to the Availability Limit, as determined
from time to time. If on any Availability Determination
Date, the Aggregate Outstandings are in excess of the
Availability Limit:
(i) Borrowers shall not be entitled to
any further Borrowings, Construction Disbursements
or Swingline Advances until the Availability Limit
is demonstrated to be in excess of the Aggregate
Outstandings as of a subsequent Availability
Determination Date, and then only to the extent of
such excess;
(ii) so long as no Default or Event of
Default shall have occurred and remains
continuing, Aggregate Outstandings in excess of
the Availability Limit need not be repaid unless
as of the next occurring Availability
Determination Date (the "Second Determination
Date") the Aggregate Outstandings continue to
exceed the Availability Limit in which event the
Borrowers shall reduce the Aggregate Outstandings
to no more than the most recently determined
Availability Limit on or before thirty (30) days
following the Second Determination Date; and
(iii) notwithstanding the provisions set
forth in subparagraph (ii) hereinabove, if a
Default or Event of Default shall have occurred
and
<PAGE>remains continuing, then the Borrowers shall
cause the Aggregate Outstandings to be reduced to
no more than the most recently determined
Availability Limit on or before the Banking
Business Day following such Availability
Determination Date.
e. Other than limitations as a result of
the Availability Limit determined under Section 2.01(d), no
limitation of the Maximum Permitted Balance shall relieve or
otherwise defer the making of each Scheduled Reduction on
each Reduction Date. In the event the Maximum Permitted
Balance is less than the Maximum Scheduled Balance as of any
Reduction Date, to the extent the difference is a result of
the Availability Limit determined under Section 2.01(d), the
Scheduled Reduction shall only reduce the Maximum Scheduled
Balance. In all other instances, the amount of each
Scheduled Reduction shall further reduce the Maximum
Permitted Balance by the amount of such Scheduled Reduction.
In no event shall the Maximum Permitted Balance exceed the
Maximum Scheduled Balance as of Reduction Dates set forth on
the Aggregate Commitment Reduction Schedule.
f. In addition to the requirements set
forth in Section 2.01(d), in the event any Scheduled
Reduction or Voluntary Reduction reduces the Maximum
Permitted Balance to less than the sum of the Aggregate
Outstandings, the Borrowers shall, except as otherwise
provided in Section 2.01(d)(ii) and (iii), on or before the
next ensuing Banking Business Day cause the Aggregate
Outstandings to be reduced by such amount as may be
necessary to cause the Aggregate 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) paying in full all loans and advances
outstanding under the Existing Bank Loan and the
WFB Loan as of the Closing Date;
(ii) paying to Rebeil and Magliarditi or
reimbursing ACI for the payment to Rebeil and
Magliarditi of up to a maximum aggregate amount of
Four Million Dollars ($4,000,000.00) pursuant to
the terms of the Gem Settlement Agreement; and
<PAGE> (iii) paying in full the Upfront Fee, the
costs, fees and expenses of Title Insurance
Companies incurred in connection with the issuance
of the Title Insurance Policies, the costs, fees
and expenses of the attorneys for Borrowers and
the costs, fees and expenses of Henderson &
Nelson, attorneys for Agent Bank, and associate
counsel and insurance consultants retained by them
incurred to the Closing Date.
b. During the Construction Period:
(i) funding Construction Disbursements
under the Construction Loan Subfacility, subject
to the terms and conditions set forth in Section
2.09 and Article IX of the Credit Agreement;
(ii) funding the cost of acquiring a portion
or portions of the Option Property, subject to the
terms and conditions set forth in Article III D of
the Credit Agreement.
c. Subsequent to the Completion Date:
(i) funding the repayment of Swingline
Advances as provided in Section 2.08;
(ii) funding working capital needs of the
Borrower Consolidation relating to the Casino
Facilities;
(iii) funding ongoing Capital Expenditure
requirements of the Borrower Consolidation
relating to the Casino Facilities; and
(iv) funding the cost of acquiring a portion
or portions of the Option Property, subject to the
terms and conditions set forth in Article III D of
the Credit Agreement.
Section 2.03. Notice of Borrowings and Interest
Rate Options.
a. An Authorized Officer may give Agent
Bank, no later than 11:00 a.m. on any Banking Business Day
at Agent Bank's office specified in Section 2.07, three (3)
full Banking Business Days prior written notice in the form
of the Notice of Borrowing ("Notice of Borrowing"), a copy
of which
<PAGE>is marked "Exhibit E", 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 two (2) full Banking Business Days prior
notice for all other Borrowings, specifying the date and
amount of each proposed Borrowing. Borrowings made pursuant
to a Construction Disbursement Request shall be Base Rate
Loans as of the applicable Funding Date and shall be made in
accordance with the provisions of Section 2.09(a). Agent
Bank shall give prompt notice of all Borrowings to Lenders
of the amount to be funded and specifying the Funding Date.
Not later than 9:00 o'clock a.m. on the Funding Date
specified, each Lender shall disburse to Agent Bank the Pro
Rata Share of the amount to be advanced by Lenders in lawful
money of the United States of America and in immediately
available funds. Agent Bank shall make the proceeds of such
fundings that it receives from the Lenders on or before
11:00 o'clock a.m. available to Borrowers by depositing,
prior to 1:00 o'clock p.m. on the day so received (but not
prior to the Funding Date), the amounts received from the
Lenders in the Designated Deposit Account maintained with
Agent Bank. No Borrowing may exceed the Available
Borrowings. Each Borrowing 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 one (1)
Construction Disbursement during each month during the
Construction Period and no more than three (3) Borrowings
during each calendar month following the Completion Date,
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.
Section 2.04. Conditions of Borrowings. During
the Revolving Credit Period, 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
<PAGE>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.
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 LIBOR Loan 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 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 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, as long as: (i) each such LIBOR Loan is in a minimum
amount of Five Million Dollars ($5,000,000.00) and in
minimum increments of One Million Dollars ($1,000,000.00),
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.
Except as qualified above, the outstanding principal balance
hereunder may be a Base Rate
<PAGE>Loan or one or more LIBOR Loans, or any combination
thereof, as Borrowers shall specify.
c. Borrowers may Convert from one Interest
Rate Option to another Interest Rate Option by giving
irrevocable notice to Agent Bank of such Conversion by 10:00
A.M., on a day which is at least three (3) Banking Business
Days prior to the proposed date of such Conversion to each
LIBOR Loan or two (2) Banking Business Days prior to the
proposed date of such Conversion to each Base Rate Loan.
Each such notice shall be made by an Authorized Officer by
telephone or telex and thereafter immediately confirmed in
writing by delivery to Agent Bank of a
Continuation/Conversion Notice specifying the date of such
Conversion, the amounts to be so Converted and the initial
Interest Period if the Conversion is 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 is to a
LIBOR Loan and shall confirm the same in writing to
Borrowers and Lenders. Each Conversion 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 Sections 2.08 or 2.09 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 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
<PAGE>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 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 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, then so long as such
circumstances shall continue: (i) Agent Bank shall promptly
notify Borrowers thereof, (ii) the Agent Bank 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.
<PAGE> 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 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 subject to Scheduled Reductions to
be allocated amongst Lenders in accordance with
their respective Syndication Interests;
(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, Fixed Rate Notices and all other
provisions for the disbursement of funds, setting
of interest rates and collection of repayments of
interest and
<PAGE>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
Borrowers, 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.
As security for the due and punctual payment and performance
of the terms and provisions of this Credit Agreement, the
Notes and all of the other Loan Documents, the Security
Documentation shall be executed and delivered, as of the
Closing Date, by the respective parties to each of the
Security Documentation.
Section 2.07. Place and Manner of Payment.
a. All amounts payable by Borrowers to the
Lenders or Agent Bank on behalf of Lenders pursuant to the
Credit Facility 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:
(i) the Scheduled Reductions of principal, or (ii) principal
payments which may be required to decrease the Aggregate
Outstandings to an amount equal to or less than the Maximum
Permitted Balance, or (iii) principal payments to increase
the Available Borrowings to an amount equal to or in excess
of Construction Completion Costs as of any date of
determination, Borrowers shall not make repayments
("Principal Prepayments") of the outstanding balance of
principal owing under the Revolving Credit Note more
frequently than three such Principal Prepayments during each
calendar month. Each such
<PAGE>Principal Prepayment shall be in a minimum amount of
Ten Million Dollars ($10,000,000.00) and in increments of
One Million Dollars ($1,000,000.00) during the Construction
Period and thereafter in a minimum amount of Five Million
Dollars ($5,000,000.00) and in increments of One Million
Dollars ($1,000,000.00).
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 o'clock 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 o'clock 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.
c. The outstanding principal owing under
the Credit Facility and the Revolving Credit Note may,
subject to Section 2.07(a), 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
<PAGE>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
(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) the total
amount so 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
<PAGE>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 subsequent to the
Completion Date, Swingline Lender agrees to lend and advance
Swingline Advances to Borrowers in the amounts and at the
times provided below.
b. With respect to each proposed Swingline
Advance, an Authorized Officer shall no later than 11:00
a.m. of the date for such proposed Swingline Advance 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 E", affixed hereto and by this
reference incorporated herein and made a part hereof,
specifying the requested amount to be funded. Swingline
Lender shall deposit such amounts as Borrowers may request
into the Designated Deposit Account in lawful money of the
United States of America in immediately available funds,
provided, that: (i) after giving effect to such Swingline
Advance, the Swingline Outstandings do not exceed Five
Million Dollars ($5,000,000.00), (ii) the amount requested
does not exceed the Available Borrowings, (iii) the
Completion Date shall have occurred, and (iv) no Default or
Event of Default has occurred and remains continuing.
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 Available Borrowings (such
verification to be promptly confirmed in writing). Unless
Borrowers are notified to the contrary by the Swingline
Lender, each repayment of a 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
<PAGE>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. In the event any Swingline Advance is
outstanding for thirty (30) consecutive calendar days, 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
<PAGE>Swingline 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. Construction Loan Subfacility.
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, Lenders
severally agree to advance Construction Disbursements to
Borrowers up to the Maximum Availability in proportion to
their respective Syndication Interests in such amounts as
Borrowers may request from time to time by Construction
Disbursement Request, pursuant to Article IX of this Credit
Agreement. Borrowers shall use the proceeds of the
Construction Loan Subfacility to finance, construct, furnish
and equip the ACLVI Project on the ACLVI Real Property to
pay other costs and expenses permitted herein related to the
financing, furnishing, equipping and construction of the
ACLVI Project and otherwise as contemplated or permitted
herein for the ACLVI Project, all as more particularly
described in the Construction Budgets. Borrowers may use
proceeds of the Construction Loan Subfacility to finance the
acquisition cost of portions of the Option Property subject
to the terms and conditions set forth in Article III D of
this Credit Agreement.
b. Each Lender's obligation to advance
Construction Disbursements in the proportionate amount of
its Pro Rata Share is several, and not joint or joint and
several. The failure of any Lender to perform its
obligation to advance a Construction Disbursement in a
proportionate amount of such Lender's Pro Rata Share will
not relieve any other Lender of its obligation hereunder to
advance such Construction Disbursement Borrowing in the
amount of such other Lender's Pro Rata Share, nor relieve
the Lender which has failed to fund of its obligations to
Borrowers hereunder.
Section 2.10. 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. Commencing on the first annual
anniversary of the Closing Date, Borrowers shall be
obligated to pay a quarterly nonusage fee (the "Nonusage
Fee") to the
<PAGE>Agent Bank for the account of Lenders in the
proportions of their respective Syndication Interests based
on the Leverage Ratio, determined as of the end of the
immediately prior Fiscal Quarter with reference to the
Borrower Consolidation, in accordance with the following
schedule:
Leverage Nonusage
Ratio Percentage
Less than 2.0 to 1.0 .375%
Equal to or
greater than 2.0 to 1.0 .500%
The Nonusage Fee shall begin to accrue on the first
anniversary of the Closing Date and shall be calculated as
of the last day of each Fiscal Quarter thereafter occurring
as the product of (i) the applicable Nonusage Percentage
determined as set forth above, multiplied by (ii) as of the
end of such Fiscal Quarter, the daily average during such
Fiscal Quarter (except with respect to the Fiscal Quarter in
which the first annual anniversary of the Closing Date
occurs, which shall be calculated with reference to the
daily average during such Fiscal Quarter only for those
number of days following the first annual anniversary of the
Closing Date) of the Maximum Permitted Balance without
regard to any Availability Limit as provided in
Section 2.01(d), less the daily average during such Fiscal
Quarter of the Funded Outstandings, all on the basis of a
three hundred sixty (360) day year. Each Nonusage Fee shall
be payable in arrears on a quarterly basis on or before ten
(10) Banking Business Days following the end of each Fiscal
Quarter commencing with the Fiscal Quarter in which the
first annual anniversary of the Closing Date occurs, and
upon termination of this Credit Agreement, whether at
maturity, by acceleration or otherwise. Each Nonusage Fee
shall be promptly distributed by Agent Bank to Lenders in
proportion to their respective Syndication Interests in the
Credit Facility.
Section 2.11. Late Charges and Default Rate.
a. If any payment due under the Revolving
Credit Note is not paid within one (1) Banking Business Day
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
<PAGE>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 each of the
Notes shall commence accruing interest at a rate equal to
two percent (2.0%) over the interest rate otherwise
applicable to such 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 such 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 2.12. Net Payments. All payments under
this Credit Agreement, the Revolving Credit Note and/or the
Swingline 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 Agreement and the Notes. A
certificate as to any additional amounts payable to the
Lenders under this Section 2.12 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
<PAGE>absent manifest or demonstrable error. Any amounts
payable by the Borrowers under this Section 2.12 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 2.13. 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,
the Revolving Credit Note, the Swingline 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 and/or the Swingline 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
<PAGE> 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. A certificate as to any additional amounts
payable to any Lender under this Section 2.13 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. Each
Lender agrees to use its reasonable efforts not materially
disadvantageous to it (in its reasonable determination) to
minimize such increased or imposed costs or such reduction.
Section 2.14. 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 2.12 or 2.13. 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 2.12 or 2.13. 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 2.12 or 2.13 arising
to the extent of such Lender's gross negligence or wilful
<PAGE>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.
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 Bank
Facilities is subject to the following conditions precedent,
each of which shall be satisfied on or before July 31, 1997
(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. The Revolving Credit Note duly executed
by the Borrowers, payable to the order of Agent Bank, on
behalf of the Lenders.
b. The Swingline Note duly executed by the
Borrowers, payable to the order of Swingline Lender.
Section 3.03. Security Documentation. The
Security Documentation duly executed by each applicable
Borrowers or other party thereto, consisting of the
following:
With Respect to the CPI Hotel/Casino
Facilities
a. CPI Deed of Trust;
b. CPI Financing Statements;
c. CPI Assignment of Spaceleases,
Contracts, Rents and Revenues;
d. CPI Assignment of Permits, Licenses and
Contracts;
<PAGE> With Respect to the ACLVI Hotel/Casino
Facility
e. ACLVI Deed of Trust;
f. ACLVI Financing Statements;
g. ACLVI Assignment of Spaceleases,
Contracts, Rents and Revenues;
h. ACLVI Assignment of Permits, Licenses
and Contracts;
With Respect to the ACCBI Riverboat/Hotel
Facilities
i. ACCBI Deed of Trust;
j. ACCBI Ship Mortgage;
k. ACCBI Financing Statements;
l. ACCBI Assignment of Permits, Licenses
and Contracts;
m. ACCBI Assignment of Spaceleases,
Contracts, Rents and Revenues;
n. ACCBI Hotel Attornment Agreement;
o. ACCBI IDNR Attornment Agreement;
p. Restated GECC Intercreditor Agreement
(only required if the GECC Ship Note is not fully paid
concurrently or substantially concurrently with the Closing
Date);
q. Restated Equipment Intercreditor
Agreement (only required if the ACCBI Equipment Loan is not
fully paid concurrently or substantially concurrently with
the Closing Date);
With Respect to the ACVI Casino Facility
r. ACVI Casino Deed of Trust;
s. ACVI Hotel Deed of Trust;
t. ACVI Ship Mortgage;
<PAGE> u. ACVI Casino Financing Statements;
v. ACVI Hotel Financing Statements;
w. ACVI Assignment of Permits, Licenses and
Contracts;
x. ACVI Assignment of Spaceleases,
Contracts, Rents and Revenues;
y. Brady/Lum Estoppel Certificate;
z. Magnolia Estoppel Certificate;
aa. Morrison Estoppel Certificate;
bb. Trustmark Nondisturbance Agreement.
Section 3.04. Other Loan Documents. The
following Loan Documents duly executed by Borrowers and each
other applicable party thereto consisting of the following:
a. Environmental Certificate.
b. Stock Pledge of all issued and
outstanding stock of CPI, together with the delivery to
Agent Bank, or into an escrow pending approval of the Nevada
Gaming Authorities, of all stock certificates which are
pledged thereunder;
c. Stock Pledge of all issued and
outstanding stock of ACLVI, together with the delivery to
Agent Bank, or into an escrow pending approval of the Nevada
Gaming Authorities, of all stock certificates which are
pledged thereunder;
d. Stock Pledge of all issued and
outstanding stock of ACCBI, together with the delivery to
Agent Bank, or into an escrow pending approval of the Iowa
Gaming Authorities, if such approval is required, of all
stock certificates which are pledged thereunder;
e. Stock Pledge of all issued and
outstanding stock of ACVI, together with the delivery to
Agent Bank, or into an escrow pending approval of the
Mississippi Gaming Authorities, if such approval is
required, of all stock certificates which are pledged
thereunder; and
<PAGE> f. Trademark Security Agreement.
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 I", 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, Availability Limit Certificates,
Compliance Certificates, Notices of Swingline Advances,
Construction Disbursement Requests 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 J", 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, substantially in the form of the
legal opinion marked "Exhibit M", affixed hereto and by this
reference incorporated herein and made a part hereof.
<PAGE> Section 3.07. Title Insurance Policies. As of
the Closing Date, the Title Insurance Policies (or proforma
commitment for the issuance thereof) consistent with the
requirements of the Closing Instructions.
Section 3.08. Survey. Subject to exceptions
approved by Lenders prior to the Closing Date, a current
boundary and location survey for the ACLVI Real Property
delivered to Agent Bank no less than ten (10) Banking
Business Days prior to the Closing Date, which must (a) be
certified to Agent Bank and the Title Insurance Company, (b)
show the ACLVI Real Property to be free of encroachments,
overlaps, and other survey defects, (c) show the courses and
distances of the lot lines for the ACLVI 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,
all other survey requirements of Title Insurance Company for
the issuance of the ACLVI Title Insurance Policy.
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 and Existing Bank
Loan and Occurrence of Senior Subordinated Notes Effective
Date. Payment by Borrowers of that portion of the Upfront
Fee and Agency Fee as provided in Sections 2.10(a) and
2.10(c). Payment in full of the Existing Bank Loan from the
Closing Disbursement under the Credit Facility. As of the
Closing Date, all Existing Bank Loan Security Documents and
all Existing Intercompany Security Documents shall be fully
released and reconveyed. The Senior Subordinated Notes
<PAGE>Effective Date shall have occurred and Agent Bank
shall have received a fully executed copy of the Indenture.
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 Bank Facilities, including, but not
limited to, escrow charges, title insurance premiums,
environmental examinations, recording fees, appraisal fees,
reasonable attorney's fees of Henderson & Nelson and Iowa,
Mississippi and maritime co-counsel retained by them 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 Bank Facilities 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 4.18(A) through (D)) and Equipment
Leases and Contracts (Schedule 4.19(A) through (D)) 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 ACLVI Real Property prepared in
conformance with the scope and limitations of ASTM Standard
Designation E1527-93 and approved by Agent Bank. 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.
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 CPI Hotel/Casino Facilities, ACVI
Casino Facility and ACCBI Riverboat/Hotel Facilities.
<PAGE> 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 gaming activities and games of chance at the CPI
Hotel/Casino Facility, ACVI Casino Facility and the ACCBI
Riverboat/Hotel Facility.
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 Bank Facilities.
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 3.25 shall be true and correct.
Section 3.21. Availability Limit Certificates.
An Availability Limit Certificate executed by an Authorized
Officer and prepared with reference to the Borrower
Consolidation as of the Fiscal Quarter ended March 31, 1997.
<PAGE> Section 3.22. Subsidiary Stock. Original stock
certificates of CPI, ACLVI, ACVI and ACCBI shall be
delivered to Agent Bank on behalf of Lenders or into an
escrow pending approval of the applicable Gaming
Authorities, as may be required.
Section 3.23. Gem Settlement Agreement. Copies
of the Gem Settlement Agreement and, if issued, the Gem
Settlement Notes in the form approved by Agent Bank and
authorized by the Nevada Gaming Authorities.
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, except
Borrowings made upon the demand of Agent Bank for the
purpose of funding repayment of Swingline Outstandings, is
subject to the occurrence of each of the following
conditions precedent as of such Funding Date:
Section 3.24. Notice of Borrowing. With respect
to any Borrowing (other than in connection with a
Construction Disbursement), 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. Borrowings requested to be made under the
Construction Loan Subfacility shall be made in accordance
with the terms and procedures set forth in Section 2.09 and
Article IX.
Section 3.25. 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
<PAGE>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
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 3.26. 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 CPI Hotel/Casino Facility,
the ACVI Casino Facility, the ACCBI Riverboat/Hotel
Facilities and, on and after the Completion Date, the ACLVI
Hotel/Casino Facility 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.
C. Conditions Precedent to Initial Construction
Disbursement. In addition to the requirements set forth in
Sections 2.01(d), 2.09 and Article IX, the obligation of
each Lender and Agent Bank to advance the Initial
Construction Disbursement is subject to Agent Bank having
received, in each case in form and substance reasonably
satisfactory to Agent Bank, Lenders and Lenders' Consultant,
each of the following:
Section 3.27. Construction Schedule, Structural
Plans and Specifications and Construction Budgets. The
Construction Schedule, the Structural Plans and
Specifications, General Contractor's Budget, Borrower
Construction Budget and the Project Development Budget, each
approved by Lenders' Consultant and Agent Bank as
substantially final and complete and acceptable for the
Initial Construction Disbursement.
Section 3.28. Construction Agreements. The
Existing General Contractor's Agreement and New General
Contractor's Agreement, each duly executed by the General
Contractor and ACLVI.
Section 3.29. Architect's Contract and Interior
Designer's Contract. The Architect's Contract duly executed
by ACLVI and the Architect. The Interior Designer's
Contract duly executed by ACLVI and the Interior Designer.
<PAGE> Section 3.30. Major Subcontractor's Construction
Contracts. A copy of all Major Subcontractor's construction
contracts then executed by and between ACLVI and the Major
Subcontractors or by and between the General Contractor and
the Major Subcontractors.
Section 3.31. Evidence of Availability of
Utilities for ACLVI Project. Evidence of the availability
of water, sewer, electric, gas and telephone service to the
ACLVI Project adequate for the use and occupation of the
ACLVI Project as the ACLVI Hotel/Casino Facility.
Section 3.32. Regulatory Approvals, Permits,
Consents, Etc. Copies of all material permits, approvals or
consents by all Governmental Authorities permitting the
construction of the ACLVI Project in accordance with the
Plans and Specifications or evidence that same can be
obtained, together with all supporting documents and
materials reasonably requested by Agent Bank.
Section 3.33. Assignment of Architect's
Contract. The Assignment of Architect's Contract duly
executed by ACLVI and Architect and the Architect's Consent
duly executed by Architect.
Section 3.34. Assignment of General Contractor's
Agreement. The Assignment of Existing General Contractor's
Agreement and New General Contractor's Agreement duly
executed by ACLVI and General Contractor and the Existing
General Contractor's Consent and New General Contractor's
Consent duly executed by General Contractor.
Section 3.35. Assignment of Interior Designer's
Contract. The Assignment of Interior Designer's Contract
duly executed by ACLVI an the Interior Designer and the
Interior Designer's Consent duly executed by the Interior
Designer.
Section 3.36. Major Subcontractor Assignments.
A Major Subcontractor Agreement and Major Subcontractor
Consent for each Assigned Major Subcontract which has been
executed as of the Initial Construction Disbursement Date.
Section 3.37. Soil Test Report. A soil test
report reasonably acceptable to Agent Bank, indicating the
suitability of the ACLVI Real Property for the construction
of the ACLVI Project thereon.
<PAGE> D. Conditions Precedent to Option Disbursement.
In addition to the requirements set forth in Sections
2.01(d), 2.09 and Article IX, the obligation of each Lender
and Agent Bank to advance an Option Disbursement is subject
to Agent Bank having received, in each case in form and
substance reasonably satisfactory to Agent Bank, Lenders and
Lenders' Consultant, each of the following:
Section 3.38. Legal Description and Parcel Map.
A complete legal description of that portion of the Option
Property to be acquired together with a true, complete and
correct copy of the parcel map recorded in the Official
Records of Clark County establishing such portion as a
separate legal parcel under Chapter 278 of the Nevada
Revised Statutes.
Section 3.39. Environmental Site Assessment.
a. A Phase I Environmental Site Assessment
of the portion of the Option Property to be acquired by
ACLVI, prepared in conformance with the scope and
limitations of ASTM Standard Designation E1527-93 and
approved by Agent Bank. Any recommended action shall have
been completed by ACLVI.
b. ACLVI shall confirm in writing that the
representations contained in Sections 2.1 and 2.2 of the
Environmental Certificate are true and correct in all
respects as to the property to be acquired.
Section 3.40. Title Policy or Endorsement.
ACLVI shall cause, at its expense, concurrently with the
funding of such Option Disbursement, the Title Insurance
Company to either: (a) issue a title insurance policy in
favor of Agent Bank insuring the ACLVI Deed of Trust as a
first priority lien encumbering the portion of the Option
Property acquired with such Option Disbursement, subject
only to ACLVI Permitted Encumbrances, or (ii) issue an
endorsement to the ACLVI Title Insurance Policy insuring the
ACLVI Deed of Trust as a first priority lien encumbering the
portion of the Option Property acquired with such Option
Disbursement, subject only to ACLVI Permitted Encumbrances.
Section 3.41. Certification of Construction
Completion Costs. ACLVI shall certify to the reasonable
satisfaction of Agent Bank and Lenders' Consultant that the
Available Borrowings, after giving effect to the advance of
the Option Disbursement, will be equal to or in excess of
the
<PAGE>Construction Completion Costs as of the requested
Funding Date.
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 Author
ization. ACI, CPI and ACLVI are each a corporation duly
organized and validly existing under the laws of the State
of Nevada. ACVI is a corporation duly organized and validly
existing under the laws of the State of Mississippi. ACCBI
is a corporation duly organized and validly existing under
the laws of the State of Iowa. 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 Bank Facilities, to consummate the transactions and
perform its obligations hereunder and thereunder, and,
except with respect to ACLVI and the ACLVI Hotel/Casino
Facility prior to the Completion Date, 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, the Swingline 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 Bank Facilities, 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
nature whatsoever upon any of their respective property or
assets by virtue of, the terms, conditions or provisions of
(a) any indenture, evidence of
<PAGE>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 Event in the
Casino Operations or in the construction and development of
the ACLVI 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 Swingline Note, the Security Documentation
and all other Loan Documents, when executed and delivered by
Borrowers in connection with the Bank Facilities 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. All
information and financial and other data previously
furnished in writing by Borrowers in connection with the
Bank Facilities 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 Event
<PAGE>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
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 Event
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.
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 CPI
Hotel/Casino Facility, ACVI Casino Facility and ACCBI
Riverboat/Hotel Facility have been obtained or accomplished
and are in full force and effect.
Section 4.07. Payment of Taxes. 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.
<PAGE> Section 4.08. Title to Properties. Borrowers
shall have good and marketable title to the Collateral
Properties (other than the ACVI Leased Parcels and the IDNR
Parcel) as of the Closing Date and at all times during the
term of the Credit Facility. ACVI shall have a good and
marketable leasehold interest in the ACVI Leased Parcels,
and ACCBI shall have a good and marketable right to use the
IDNR Parcel, all as of the Closing Date and at all times
during the term of the Credit Facility. Except with respect
to the ACVI Leased Parcels and the IDNR Parcel, 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 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 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. 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 Bank Facilities.
Section 4.10. Brokerage Commissions. No person
is entitled to receive any brokerage commission, finder's
fee or similar fee or payment in connection with the
extensions of
<PAGE>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. Borrowers are not in
violation of any applicable law and/or regulations, the
violation of which materially and adversely affects the
business, financial condition or operations of the
Collateral Properties or the Casino Operations. 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 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 have a Material Adverse Effect.
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 Effect.
Section 4.13. Availability of Utility Services.
All utility services and facilities necessary for the 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 Casino Facilities
and the ACLVI Project 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
<PAGE>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 Casino Facilities, or
any portion thereof, in existence as of the Closing Date,
are set forth on Schedules 4.15(A) through (D) attached
hereto.
Section 4.16. Equipment Leases and Contracts.
Schedules of all executed Equipment Leases and Contracts
pertaining to the Casino Facilities or any portion thereof,
in existence as of the Closing Date, are set forth on
Schedules 4.16 (A) through (D) 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 presently hold all Gaming
Permits necessary for the continued operation of the CPI
Hotel/Casino Facility, ACVI Casino Facility and ACCBI
Riverboat/Hotel Facility.
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. ACVI Land Leases. The copies of
each of the ACVI Land Leases delivered to Agent Bank by
Borrowers is a true, correct and complete copy of the
original thereof, as in effect on the date hereof, and no
amendments or
modifications thereto which are not included in such copy
have been made. None of the ACVI Land Leases have been
terminated and each of the ACVI Land Leases is in full force
and effect. ACVI is not in default in the observance or
performance of its obligations under any of the ACVI Land
Leases, except and to the extent, such default reasonably
would not be expected to have a Material Adverse Effect.
ACVI has done all things required to be done as of the date
of this Credit Agreement to keep unimpaired its rights under
the ACVI Land Leases.
Section 4.20. ACCBI Land Use Agreement. The
copy of the ACCBI Land Use Agreement delivered to Agent Bank
by Borrowers is a true, correct and complete copy of the
original thereof, as in effect on the date hereof, and no
amendments or
<PAGE>modifications thereto which are not included in such
copy have been made. The ACCBI Land Use Agreement has not
been terminated and is in full force and effect. The
interest of Koch under the ACCBI Land Use Agreement has been
duly assigned to ACCBI and ACCBI is not in default in the
observance or performance of its obligations under the ACCBI
Land Use Agreement, except and to the extent, such default
reasonably would not be expected to have a Material Adverse
Effect. ACCBI has done all things required to be done as of
the date of this Credit Agreement to keep unimpaired its
rights under the ACCBI Land Use Agreement.
Section 4.21. 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 4.22. 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 4.23. Labor Relations. There is no
strike or work stoppage in existence, or to the best
knowledge of Borrowers threatened, involving any Borrower or
the Casino Facilities or the ACLVI Project that reasonably
would be expected to have a Material Adverse Effect.
Section 4.24. Trademarks, Patents, Licenses,
Franchises, Formulas and Copyrights. Except as disclosed in
Schedule 4.24, 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 Effect 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 which is
registered with any Governmental Authority is set forth on
Schedule 4.24, attached hereto.
<PAGE> Section 4.25. 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 4.25.
Section 4.26. 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 the ACVI Hotel Subsidiary,
Ameristar Casino Lawrenceberg, an Indiana corporation,
Nevada AG Air, Ltd., a Nevada limited liability company,
Kid's Quest of Council Bluffs, LLC, an Iowa limited
liability company and AC Food Services, Inc., a Nevada
corporation.
Section 4.27. Construction Permits. All permits
and authorizations by all applicable Governmental
Authorities for the construction of the ACLVI Project have
been issued in favor of and received by ACLVI and a true and
correct copy thereof delivered to Lender.
Section 4.28. The ACLVI Project. The ACLVI
Project will be carried out and undertaken by ACLVI in
complete compliance with all applicable zoning,
environmental protection, use and building codes, laws,
rules, regulations and ordinances, including, without
limitation, the Americans with Disabilities Act. The
General Contractor Budget and the Borrower Construction
Budget, as aggregated in the Project Development Budget, set
forth all Construction Completion Costs as of the Closing
Date.
Section 4.29. General Contractor Agreement,
Architect Contract and Interior Designer's Contract. The
copies of each of the General Contractor Agreement,
Architect's Contract and Interior Designer's Contract
relating to the ACLVI Project delivered to Lenders by
Borrowers 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.
Each of the General Contractor Agreement, the Architect's
Contract and Interior Designer's Contract has not been
terminated and is in full force and effect. ACLVI is not in
default in the observance or performance of its obligations
under said documents and instruments, except and to the
extent, such default reasonably would not be expected to
have a Material Adverse Effect. ACLVI has done all things
required to be done as of the date
<PAGE>of this Credit Agreement to keep unimpaired its rights
thereunder.
ARTICLE V
GENERAL COVENANTS OF BORROWERS
To induce the Banks to enter into this Credit
Agreement, Borrowers covenant to Banks as follows:
A. General Covenants.
Section 5.01. FF&E. The Borrower Consolidation
shall furnish, fixture and equip the Casino Facilities with
FF&E it reasonably deems appropriate for the operation of
the Casino Facilities. All FF&E that is purchased and
installed in the 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 herein, to the extent such
non-replaced FF&E exceeds a cumulative aggregate value of
One Hundred Thousand Dollars ($100,000.00) as to any one of
the Collateral Properties during the term of the Credit
Facility, Borrowers shall be required to immediately,
permanently reduce the Maximum Permitted Balance of the
Credit Facility by the amount of the Capital Proceeds of the
FF&E so disposed of in excess of such One Hundred Thousand
Dollars ($100,000.00), subject, however, to the right of
Agent Bank to verify to its reasonable satisfaction the
amount of said Capital Proceeds; in the event Agent Bank and
Borrowers do not agree as to the value of the FF&E disposed
of and the amount of the Capital Proceeds, then Borrowers,
at their sole cost and expense, shall obtain a written
appraisal of the FF&E disposed of, in excess of such One
Hundred Thousand Dollars ($100,000.00) from an appraiser
reasonably satisfactory to Agent Bank, setting forth said
values and amounts, and Lenders agree to accept the results
of said appraisal. The Maximum Permitted Balance shall
immediately be reduced without duplication by the amount of
such appraisal.
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
<PAGE>approvals obtained from any Governmental Authorities
which are required for the operation and use of the
Collateral Properties as the 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 ACLVI Project and the Casino Facilities in
accordance with this Section 5.03, except such claims and
liens, if any, as: (a) 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, and (b) are junior in priority to the
applicable Deed of Trust or the Title Insurance Company has
insured the applicable Deed of Trust with priority over such
claims and liens, except with respect to the ACCBI Permitted
Encumbrances which are shown as exceptions on Schedule B of
the ACCBI Title Insurance Policy. If any mechanic's lien or
materialman's lien shall be recorded, filed or suffered to
exist against the Collateral Properties 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 ACLVI Project or the 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 one hundred eighty (180) days following its
receipt of such notice with respect to liens and/or claims
against the ACCBI Riverboat/Hotel Facilities and within
sixty (60) days following its receipt of such notice with
respect to any of the other Casino Facilities.
Section 5.04. Full Payment of Existing Bank Loan
and WFB Loan. On or before the Closing Date, Borrowers
shall pay in full or cause to be fully paid all sums of
principal and interest owing under the Existing Bank Loan
and WFB Loan and shall cause all Existing Bank Loan Security
Documents and Existing Intercompany Security Documents to be
fully released, discharged and reconveyed.
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
<PAGE>executive office of Borrowers shall be located at 3773
Howard Hughes Parkway, Las Vegas, Nevada 89109; provided,
however, Borrowers shall be entitled to move their chief
executive office to another location within the State of
Nevada upon no less than thirty (30) days prior written
notice to Agent Bank, (b) the 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 Casino Facilities as
presently conducted and as presently contemplated and
disclosed to Banks.
Section 5.06. Preservation and Maintenance of
Properties and Assets. At all times throughout the term of
the Credit Facility, (a) 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
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 (b) 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. 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: (a) 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 Casino Facilities, or any of
them, or (b) if not so adjacent, necessary and required for
the use and operation of such Collateral Property, 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,
<PAGE>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 Bank 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 (4th) Fiscal Quarter in any
Fiscal Year), the consolidated and consolidating balance
sheet, income statement, operating statement setting forth
average daily room rate, hotel occupancy rate, win per slot
and win per table game, patron admission counts at the
Casino Facilities to the extent available and statement of
retained earnings and cash flows (in each case reconciled
with year end audited statements and compared to budget and
prior year period) of the Borrower Consolidation as at the
end of such Fiscal Quarter and for the portion of the Fiscal
Year ended with such Fiscal Quarter, 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,
<PAGE>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 G", 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 4.0
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 ACI and reasonably satisfactory to the
Agent Bank (it being understood that any "Big 6" 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,
<PAGE>such accountants have 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. 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) an Availability Limit Certificate in the form
marked "Exhibit H", affixed hereto and by this reference
incorporated herein and made a part hereof (the
"Availability Limit Certificate") setting forth the
calculation of EBITDA as of the last day of such Fiscal
Quarter, together with the immediately three (3) preceding
Fiscal Quarters on a four (4) Fiscal Quarter basis, and
providing reasonable detail as to the calculation thereof
and setting forth the Availability Limit as of the
Availability Determination Date as a multiple of three and
one-quarter (3.25) times (x) the aggregate EBITDA for such
four (4) Fiscal Quarters; and
<PAGE> g. 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 ACI, and copies of all annual,
regular, periodic and special reports (including, without
limitation, each 10Q and 10K report) and registration
statements which ACI 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.
h. Until Bank Facility Termination,
Borrowers, and each of them, shall keep and maintain
complete and accurate books and records in accordance with
GAAP, consistently applied. Borrowers, and each of 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.
i. Until Bank 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 Bank Facility
Termination, Borrowers shall obtain, or cause to be
obtained, and shall maintain or cause to be maintained with
respect to the Collateral, including without limitation, the
Vessels, 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 (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
<PAGE>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) and provide that all losses
in excess of Five Hundred Thousand Dollars ($500,000.00) 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 perils "All Risk" property
coverage for all personal property owned, leased or for
which Borrowers are 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 One
Hundred Thousand Dollars ($100,000.00) 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 with a limit
representing no less than Eighty percent (80%) of the
projected annual net profit plus continuing expenses
(including debt service) for the Casino Facilities with
respect to all land-based facilities. 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 sixty (60) days endorsement. These coverages
may have deductible of no greater than forty-eight (48)
hours, or One Hundred Thousand ($100,000.00), if a separate
deductible applies.
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 Twenty Million
Dollars ($20,000,000.00). The policy shall include
extensions for Agreed Amount (waiving co-insurance) and
Replacement Cost Valuation. The policy may contain
deductibles of no greater than Fifty Thousand Dollars
($50,000.00) direct and forty-eight (48) hours indirect.
<PAGE> e. Crime Insurance. Borrowers shall obtain
a comprehensive crime policy, including the following
coverages:
(i) employee dishonesty - Two Million
Dollars ($2,000,000.00);
(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).
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 Two
Hundred Thousand Dollars ($200,000.00) for employee
dishonesty and Fifty Thousand Dollars ($50,000.00) for all
coverages listed above.
f. Commercial General Liability (1996 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 be
extended to provide watercraft Liability for permanently
moored barges while stationary. The policy will also
include extensions for Liquor Legal Liability and Employee
Benefits Legal Liability, Innkeepers Legal and Safe Deposit
Box Legal coverages. If the general liability policy
contains a self-insured retention, it shall be no greater
than Fifty Thousand Dollars ($50,000.00) per occurrence.
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
<PAGE>additional insured. The coverage for additional
insured shall apply on a primary basis irrespective of any
other insurance whether collectible or not.
g. 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 Fifty Thousand
Dollars ($50,000.00) per occurrence. The following
additional coverages must be purchased by Borrowers:
(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 Five Thousand
Dollars ($5,000.00) for each auto and Twenty-Five
Thousand Dollars ($25,000.00) for each loss.
h. Workers Compensation and Employers
Liability Insurance. Borrowers shall maintain a standard
workers compensation policy covering the states of Nevada,
Mississippi, Iowa 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 Three Hundred Thousand Dollars ($300,000.00) per
occurrence.
<PAGE> i. Marine Insurance (for all vessels that
are owned or leased by any Borrower or for which any of the
Borrowers are legally liable).
(i) Hull and Machinery Coverage. This
policy will provide the broadest possible scope of
property coverage available including all
Traditional Commercial Hull insuring conditions,
American Institute clauses (including liner
negligence and SR&CC clauses) covering the vessel
for physical damage at a value that represents one
hundred percent (100%) of the replacement cost for
each Vessel. The policy will include Agreed
Amount (waving co-insurance) and replacement cost
valuation endorsements. The policy may contain a
deductible of no greater than Two Hundred Fifty
Thousand Dollars ($250,000.00) per occurrence.
(ii) Casino Boat Business Interruption.
Borrowers will purchase business interruption
coverage under a "comprehensive facility form"
indemnifying each vessel operation for loss of net
profits and continuing expenses (including debt
service) for loss arising from casualty to the
vessel and any other cause beyond the control of
the Borrowers. The limit purchase must represent
no less than fifty percent (50%) of the annual net
profit plus continuing expenses. The policy may
have a deductible of no greater than twenty-one
(21) days for each vessel.
(iii) Protection and Indemnity. Protection
and Indemnity coverage will be written through a
combination of Primary and Excess coverage with a
Twenty-Five Million Dollar ($25,000,000.00)
combined single limit for bodily injury and
property damage, including all standard policy
form extensions. The policy shall be written on
an occurrence form. The Agent Bank and Banks will
be included as additional insureds under the
policy.
(iv) Comprehensive Pollution Liability.
Borrowers shall purchase Comprehensive Pollution
Liability coverage with a limit of no less than
Twenty-Nine Million Dollars ($29,000,000.00) per
incident covering any loss or damage resulting
from any discharge, admission, spillage or leakage
on or into water, including governmental mandated
clean
<PAGE>up. The limits can be secured through the
purchase of primary and excess policies, as long
as all coverages follow form. The Agent Bank and
Banks will be included as additional insureds
under the policy.
j. Aircraft Policy. Borrowers shall
maintain aircraft liability coverage with a limit of no less
than Fifty Million Dollars ($50,000,000.00) on all aircraft
that are owned, operated or leased by any of the Borrowers.
The policy shall also provide physical damage coverage for
all "owned" aircrafts with a deductible of no greater than
Fifty Thousand Dollars ($50,000.00).
k. Underground Storage Tank Liability.
Borrowers shall maintain an underground storage tank
liability policy providing first party (property damage) and
third party (bodily/property damage) coverages for
environmental claims resulting from underground storage
tanks at the Casino Facilities. The policy will include
coverage for all governmental and regulatory agency mandated
clean ups. The policy shall provide limits of no less than
Five Million Dollars ($5,000,000.00) each incident, Five
Million Dollars ($5,000,000.00) in the aggregate, with a
sublimit of One Million Two Hundred Fifty Thousand Dollars
($1,250,000.00) for covering defense expenses for first and
third party claims. The policy may contain a deductible of
no greater than Five Hundred Thousand Dollars ($500,000.00)
for first and third party claims. This provision may be
satisfied in part by CPI's and ACLVI's participation in and
compliance with NRS 590.700 through 590.920, inclusive, and
the regulations promulgated thereunder. Borrowers shall
provide Agent Bank proof of registration of all regulated
underground storage tanks.
l. 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.
m. Umbrella/Bumbershoot Liability. An
Umbrella/Bumbershoot Liability policy shall be purchased
with a limit of not less than One Hundred Million Dollars
($100,000,000.00) providing excess coverage over all limits
and coverages indicated in paragraphs (f), (g), (h),
(i)(iii)
<PAGE>and (iv) above. Excess Umbrella/Bumbershoot policies
can be obtained by a combination of Primary and Excess
Umbrella/Bumbershoot policies, provided that all layers
follow form with the underlying policies indicated in (f),
(g), (h) and (i)(iii) and (iv) and 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.
n. 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. 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.
o. Construction Insurance Coverages.
Borrowers shall obtain, or cause to be obtained and shall
maintain, or caused to be maintained with respect to the
ACLVI Project until the occurrence of the Completion Date,
at their own cost and expense, the following policies:
(i) Builders Risk. All Risk Builders Risk
form providing property coverage during
construction on a completed value form
(representing one hundred percent (100%) of the
anticipated construction cost). The policy will
include endorsements extending coverage for
(a) Delay of Opening (Business Interruption);
(b) Soft Costs; (c) Property in Transit;
(d) Offsite Storage. The policy can be subject to
a deductible of no greater than Twenty-Five
Thousand Dollars ($25,000.00) for Property Damage
<PAGE>and ten (10) days for Delay of Opening.
Agent Bank must be included as mortgagee.
(ii) Owners/Contractors Protective Liability
Policy ("OCP"). During the Construction Period,
OCP policies will be purchased and maintained by
owner, or owners general contractor, providing
separate liability coverage for owner and Agent
Bank. The policy limit of liability will be no
less than Five Million Dollars ($5,000,000.00).
(iii) Contractors/Sub-Contractors Insurance
Requirements. ACLVI shall require that the
General Contractor and each Subcontractor party to
a Major Subcontract with an expected or stated
costs in excess of One Million Dollars
($1,000,000.00) performing work at the ACLVI
Project comply with the minimum insurance
requirements per Schedule 5.09(o) attached hereto
and by this reference incorporated herein and made
a part hereof.
(iv) On and after the Completion Date, the
ACLVI Project shall be protected by the insurance
coverages required under Section 5.09 a through j,
k, l and m.
p. Any other insurance reasonably
requested by Agent Bank or Requisite Lenders in such amount
and covering such risks as may be reasonably requested.
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 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
<PAGE>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 to publish notice of and
fully protect the liens of the Deeds of Trust and the Loan
Documents and to protect or
<PAGE>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
<PAGE>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.
Section 5.15. Inspection of the Collateral and
Appraisal. At all times during the term of the Credit
Facility, 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. 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.
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 have a
Material Adverse Effect on 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 Casino Facilities, or (c) any
proposal by any Governmental Authority to acquire any of the
material assets or business of Borrowers.
Section 5.18. Occurrence of Senior Subordinated
Notes Effective Date, Designation of Senior Debt and
Required Payments from Proceeds of Senior Subordinated
Notes. As of the Closing Date, Lenders do hereby consent to
the issuance of the Senior Subordinated Notes by ACI in
accordance with and pursuant to the Indenture, in the form
of the Senior
<PAGE>Subordinated Notes and Indenture reviewed and approved
by Lenders (with such changes as do not materially and
adversely affect the Banks), up to the aggregate outstanding
amount at any time of One Hundred Twenty-Five Million
Dollars ($125,000,000.00). The Senior Subordinated Notes
Effective Date shall occur on or before July 31, 1997.
Either (i) pursuant to the terms of the Indenture, the Bank
Facilities shall be designated as senior debt or (ii) on or
before ten (10) Banking Business Days following the Senior
Subordinated Notes Effective Date, Borrowers shall cause the
Bank Facilities to be designated as senior debt pursuant to
an officers' certificate in accordance with such procedure,
if any, as may be set forth in the Indenture. On or before
ten (10) Banking Business Days following the Senior
Subordinated Notes Effective Date, Borrowers shall pay or
cause to be paid the following Indebtedness:
a. no less than Seventy Million Dollars
($70,000,000.00) in the aggregate of the outstanding
principal then owing under the Revolving Credit Note, the
Existing Bank Loan and/or the WFB Loan;
b. all Indebtedness owing under the terms
of the GECC Ship Note and ACCBI Equipment Loan and shall
additionally cause the release and reconveyance of the GECC
Ship Mortgage, the ACCBI Equipment Ship Mortgage and other
security instruments encumbering the ACCBI Riverboat or any
equipment, furniture, fixtures or gaming devices located on
the ACCBI Riverboat other than the ACCBI Ship Mortgage and
related security interests in favor of Agent Bank on behalf
of the Lenders; and
c. other Indebtedness of the Borrower
Consolidation as determined by Borrowers.
Section 5.19. Consents of and Notice to Gaming
Authorities.
a. ACI shall make all necessary
applications to and pursue in good faith and obtain with
reasonable diligence (but in no event later than ninety (90)
days following the Closing Date) all necessary consents and
approvals of the applicable Gaming Authorities to the:
(i) pledge of the stock of CPI, ACLVI, ACCBI and ACVI
pursuant to the Stock Pledges, (ii) the restrictions on
transfer and hypothecation of the stock of CPI, ACLVI, ACCBI
and ACVI contained in Sections 6.10 and 7.01(u), and
(iii) the terms set forth in the Credit Agreement and each
of the Loan
<PAGE>Documents, to the extent which may be required by the
Iowa Gaming Authorities; and
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 Regulation
II.I. Section 11(b) of the Regulations of the Mississippi
Gaming Commission.
Section 5.20. 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 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 5.21. 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 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 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
Casino Facilities under, any Hazardous Materials Laws.
<PAGE> Section 5.22. Compliance with ACVI Land Leases
and ACCBI Land Use Agreement.
a. Until Bank Facilities 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, as lessee under each of the
ACVI Land Leases and under the ACCBI Land Use Agreement.
Except the exercise of renewal and purchase options under
the Brady/Lum Lease and the Morrison Lease in accordance
with subsections (b) and (c) below, none of the Borrowers
shall amend, modify or terminate, or enter into any
agreement to amend, modify or terminate any of the ACVI Land
Leases or the ACCBI Land Use Agreement without the prior
written consent of Requisite Lenders.
b. At least six (6) months prior to
expiration of the Primary Term under the Brady/Lum Lease (as
defined therein) and at least six (6) months prior to each
Renewal Term under the Brady/Lum Lease (as also defined
therein), ACVI shall either: (i) exercise its option to
extend the Brady/Lum Lease for a Renewal Term in accordance
with the terms and conditions set forth therein; or
(ii) provide written notice to the lessor under the
Brady/Lum Lease of its intention to exercise the Purchase
Option (as also defined therein) (a "Purchase Option
Notice") and thereafter diligently pursue the closing for
such purchase on, or before, expiration of the then current
term of the Brady/Lum Lease. Concurrently with all notices
to the lessor under the Brady/Lum Lease which are required
under this subsection (b), ACVI shall deliver copies of such
notices to Agent Bank, and if ACVI delivers a Purchase
Option Notice, ACVI shall from time to time provide Agent
Bank with such information as Agent Bank may reasonably
request, regarding actions taken by ACVI in pursuit of
closing in accordance with said Purchase Option Notice.
c. At least six (6) months prior to
expiration of the Primary Term under the Morrison Lease (as
defined therein), ACVI shall provide written notice to the
lessor under the Morrison Lease of its intention to exercise
the Purchase Option (as also defined therein) and thereafter
diligently pursue the closing for such purchase on, or
before, expiration of the Primary Term under the Morrison
Lease. Concurrently with such notice, ACVI shall deliver a
copy thereof to Agent Bank, and from time to time shall
provide Agent Bank with such information as Agent Bank may
reasonably
<PAGE>request, regarding actions taken by ACVI in pursuit of
closing in accordance with the Purchase Option under the
Morrison Lease.
Section 5.23. Compliance with Access Laws.
a. Borrowers agree that Borrowers, the
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 decree of any court adopted or enacted with respect
thereto, as now existing or hereafter amended or adopted
(collectively, the "Access Laws"). 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
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 Casino
Facilities or the Collateral Properties to comply with any
of the Access Laws. The obligations and liabilities of
Borrowers under this
<PAGE>section shall survive Bank Facility Termination, any
satisfaction, assignment, judicial or nonjudicial
foreclosure proceeding, or delivery of a deed in lieu of
foreclosure.
Section 5.24. ACVI Hotel Provisions.
a. ACVI may convey the ACVI Hotel Property
to the ACVI Hotel Subsidiary at any time subsequent to the
Closing Date. Upon such conveyance ACVI shall give written
notice thereof to Agent Bank and shall promptly deliver to
Agent Bank a conformed copy of the conveyance instrument.
b. Upon the closing of the ACVI Hotel
Construction Loan in accordance with the provisions set
forth in Section 6.08(d), Agent Bank shall subordinate the
lien priority of the ACVI Hotel Deed of Trust and ACVI Hotel
Financing Statements to the ACVI Hotel Construction Deed of
Trust and ACVI Hotel Construction Financing Statements,
without further authorization or consent of the Lenders.
c. Upon completion of the ACVI Hotel, ACVI
and the ACVI Hotel Subsidiary may enter into a management
agreement under the terms of which ACVI will operate and
manage the ACVI Hotel so long as:
(i) the terms of such management
agreement are first approved in writing by Agent
Bank, and
(ii) all costs, expenses, fees and
other charges incurred by ACVI in connection with
the operation and management of the ACVI Hotel
will be fully reimbursed to ACVI by the ACVI Hotel
Subsidiary no less frequently than as of the end
of each Fiscal Quarter.
B. Construction Covenants.
Section 5.25. Commencement and Completion of the
ACLVI Project. ACLVI will commence the ACLVI Project and
shall complete the ACLVI Project with due diligence (i) in
accordance and compliance with the Plans and Specifications
prepared by the Architect and the Interior Designer in all
material respects and (ii) in accordance and compliance with
the terms and conditions of this Credit Agreement, and all
material requirements of all Governmental Authorities acting
in or for the locality in which the ACLVI Real Property is
<PAGE>situated. The Completion Date shall be no later than
June 30, 1998.
Section 5.26. Master Set of Plans and
Specifications.
a. A master set of the final Structural
Plans and Specifications shall be furnished to Agent Bank
and Lenders' Consultant at least ten (10) Banking Business
Days prior to the Initial Construction Disbursement and
shall be held by Agent Bank throughout the term of the
Credit Facility, and said set of Structural Plans and
Specifications shall govern all matters that may arise with
respect to the construction and completion of the structural
and exterior components of the ACLVI Project.
b. A master set of the final Interior
Plans and Specifications shall be furnished to Agent Bank
and Lenders' Consultant at least ten (10) Banking Business
Days prior to the advance of any Construction Disbursement
relating to the payment of any amounts not set forth on the
General Contractor's Budget and shall be held by Agent Bank
throughout the term of the Credit Facility, and said set of
Interior Plans and Specifications shall govern all matters
that may arise with respect to the construction and
completion of the interior components, equipment and
furnishing of the ACLVI Project.
Section 5.27. Construction of the ACLVI Project
Entirely on the ACLVI Real Property. The ACLVI Project
shall be constructed entirely on the ACLVI Real Property and
shall not encroach upon or overhang any real property,
easement (other than Permitted Encumbrances) or restriction
rights owned by any other person or entity unless such other
person or entity has consented or waived such encroachment
to the reasonable satisfaction of Agent Bank and Requisite
Lenders.
Section 5.28. List and Assignment of Major
Subcontracts.
a. ACLVI shall furnish to Agent Bank from
time to time during the Construction Period, within a
reasonable time after written request by Agent Bank to
ACLVI, in a form reasonably acceptable to Agent Bank, a then
current correct list and copy of all contracts, subcontracts
and material suppliers, including, without limitation, all
Major Subcontracts executed by any Borrower and/or General
Contractor in connection with the ACLVI Project. Borrowers
<PAGE>agree that Agent Bank or Lenders' Consultant may
contact any such contractor, subcontractor or material
supplier to verify any facts disclosed in the lists.
b. Concurrently with the execution of each
Major Subcontract requiring payment thereunder in excess of
Five Million Dollars ($5,000,000.00) in the aggregate (each
individually an "Assigned Major Subcontract" and
collectively the "Assigned Major Subcontracts"), ACLVI shall
cause such Assigned Major Subcontract to be assigned to
Agent Bank on behalf of Lenders as additional security for
the Credit Facility and the Subcontractor party thereto to
consent to such assignment, each in substantially the form
of the Assignment of General Contractor's Agreement and
General Contractor's Consent, or as otherwise reasonably
required by Agent Bank.
Section 5.29. Project Sign. During the
construction of the ACLVI Project, Agent Bank may require
the Borrowers to erect a sign at the ACLVI Project at
ACLVI's expense. The size, design, wording and location of
such a sign shall be subject to Agent Bank's approval. The
sign may be erected as soon as practical following the Agent
Bank's request.
Section 5.30. Inspection of Construction Progress
and Lenders' Consultant. Designated representatives of
Agent Bank, Lenders and Lenders' Consultant, shall, at all
times during the Construction Period, have the right of
reasonable entry and free access to the ACLVI Real Property
and the right to inspect all work done, labor performed and
materials furnished in connection with the ACLVI Project and
the right of reasonable inspection to inspect all books,
contracts and records of Borrowers relating to the ACLVI
Project. In performing such inspection, Agent Bank, Lenders
and Lenders' Consultant shall cooperate with Borrowers in
making suitable arrangements to minimize disruption of the
construction work, and pursuant to Borrowers' insurance
policies and safety and security requirements.
ARTICLE VI
FINANCIAL COVENANTS
Until payment in full of all sums owing hereunder
and under the Notes and the occurrence of Bank Facilities
Termination, Borrowers agree, as set forth below, to comply
or cause compliance with the following Financial Covenants.
<PAGE> Section 6.01. Minimum Capital Expenditures.
During each Fiscal Year, commencing with the Fiscal Year
commencing January 1, 1998, Borrowers shall make or cause to
be made, Capital Expenditures to the Collateral Properties
in a minimum aggregate amount equal to or greater than two
percent (2%) of net revenues derived from the Collateral
Properties by the Borrower Consolidation during the
immediately preceding Fiscal Year.
Section 6.02. 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) Fifty Million Dollars ($50,000,000.00),
plus (b) ninety percent (90%) of Net Income after taxes
realized as of each Fiscal Quarter end occurring on and
after March 31, 1997 (without reduction for any net losses),
plus (c) ninety percent (90%) of the proceeds received in
Cash or Cash Equivalents (net of reasonable expenses) of any
and all additional Equity Offerings made after the Closing
Date, other than proceeds of any Equity Offerings that are
required to be paid to Rebeil or Magliarditi pursuant to the
terms of the Gem Merger Agreement.
Section 6.03. Leverage Ratio. Commencing as of
the first Fiscal Quarter ending subsequent to the Closing
Date and continuing as of each Fiscal Quarter end until Bank
Facilities 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:
Fiscal Quarter End Leverage Ratio
As of the Closing Date through
the Fiscal Quarter ending
December 31, 1998 5.00 to 1.00
As of the Fiscal Quarter ending
March 31, 1999, through the
Fiscal Quarter ending
December 31, 1999 4.50 to 1.00
As of the Fiscal Quarter ending
March 31, 2000, through Bank
Facilities Termination 4.00 to 1.00
Section 6.04. Gross Fixed Charge Coverage Ratio.
Commencing as of the first Fiscal Quarter ending subsequent
to
<PAGE>the Closing Date and continuing as of each Fiscal
Quarter end until Bank Facilities Termination, the Borrower
Consolidation shall maintain a Gross Fixed Charge Coverage
Ratio no less than 1.50 to 1.00.
Section 6.05. 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 Bank Facilities Termination, the
Borrower Consolidation shall maintain an Adjusted Fixed
Charge Coverage Ratio no less than 1.10 to 1.00.
Section 6.06. Contingent Liability(ies). The
Borrower Consolidation shall not directly or indirectly
incur any Contingent Liability(ies) in excess of the
cumulative aggregate amount of Five Million Dollars
($5,000,000.00) without the prior written consent of
Requisite Lenders.
Section 6.07. Investment Restrictions. Other
than Investments permitted herein 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) Loans and advances to employees in the
ordinary course of business not exceeding Two Hundred
Thousand Dollars ($200,000.00) in the aggregate at any one
time; and
(f) In addition to Investments permitted
under clause (g) below, Investments, including Investments
in Subsidiaries which are not members of the Borrower
Consolidation, at the discretion of Borrowers up to the
maximum cumulative aggregate amount of Two Million Dollars
($2,000,000.00);
<PAGE> (g) In addition to Investments permitted
under clause (f) above, investment by ACVI in the ACVI Hotel
Subsidiary up to the maximum cumulative aggregate amount of
Two Million Dollars ($2,000,000.00), together with
conveyance of title to the ACVI Hotel Property by ACVI to
the ACVI Hotel Subsidiary following the Closing Date; and
(h) Capital Expenditures for the Casino
Facilities.
Section 6.08. 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 not secure Indebtedness in
excess of Fifteen Million Dollars ($15,000,000.00) 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 6.08(c);
(d) The ACVI Hotel Construction Security
Documents and any Liens created thereunder, so long as each
of the following conditions are true and correct in all
respects:
(i) that the ACVI Hotel Construction
Loan and the ACVI Hotel Construction Date evidence
Indebtedness owing by the ACVI Hotel Subsidiary to
the ACVI Hotel Construction Lender in an aggregate
principal amount of no greater than Seven Million
Five Hundred Thousand Dollars ($7,500,000.00);
<PAGE> (ii) that the ACVI Hotel Construction
Loan and ACVI Hotel Construction Note be non-
recourse as to ACVI and each other member of the
Borrower Consolidation, except for Contingent
Liabilities that will be subject to the limitation
set forth in Section 6.06; and
(iii) that the proceeds of the ACVI
Hotel Construction Loan be used to finance the
construction and development of a hotel on the
ACVI Hotel Property containing no less than one
hundred forty (140) rooms to be constructed in
accordance with plans and specifications which are
first approved in writing by Agent Bank; and
(e) Liens described on Schedule 6.08 annexed
hereto.
Section 6.09. No Merger. No Borrower shall
merge, consolidate with or sell all or substantially all of
its assets.
Section 6.10. No Transfer of Ownership. ACI
shall not transfer or hypothecate its ownership interests in
CPI, ACLVI, ACCBI or ACVI except in connection with the
Security Documentation. This provision shall not be
effective as to ACVI until it is approved by the Mississippi
Gaming Authorities.
Section 6.11. Dividend Restriction. ACI shall
not pay or declare any dividends or Distributions on capital
stock during any period in which the most recently
calculated Leverage Ratio of the Borrower Consolidation is
greater than 2.00 to 1.00.
Section 6.12. 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
Effect, to:
(i) engage in any non-exempt
"prohibited transaction", as such term is defined
in Section 4975 of the Code;
<PAGE> (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
Effect.
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 Effect.
Section 6.13. Margin Regulations. No part of the
proceeds of the Credit Facility or Swingline 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 6.14. 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 6.15. 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
<PAGE>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 Notes, the Environmental Certificate, or any
other Loan Document or in any report, certificate, 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 Notes 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, which
default continues beyond any applicable grace period therein
contained;
<PAGE> d. Borrowers shall have defaulted in the
payment of any late charge, Nonusage Fees, Agency Fees,
expenses, indemnities or any other amount owing under any
Loan Document 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 or 6.09, or (ii) any other term,
covenant, condition or promise contained in this Credit
Agreement, the Notes, 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 has a
Material Adverse Effect, 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);
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
<PAGE>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 any
Indebtedness (other than any Indebtedness under this Credit
Agreement or under the Gem Settlement Notes), if the
aggregate amount of such Indebtedness is One Million Dollars
($1,000,000.00), 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;
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 Casino Facility, other than the
Permitted Encumbrances and as permitted in Section 5.01;
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
<PAGE>or for the appointment by an appropriate United States
District Court of a trustee to administer any such plan that
would constitute a Material Adverse Effect, 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 Borrower's right to use the Collateral
Properties as the Casino Facilities;
o. Any Borrower shall fail to perform, in a
timely manner, any material obligation which such Borrower
has under any of the ACVI Land Leases or ACCBI Land Use
Agreement and does not cure such failure prior to the
expiration of any applicable grace period;
p. 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 Casino Facilities other than on
account of forces majeure at least to the same general
extent as is presently conducted thereon or in the case of
the ACLVI Project as presently contemplated thereon for a
period in excess of thirty (30) consecutive days;
q. 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 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
<PAGE>any event later than five (5) days prior to the date
of any proposed sale thereunder);
r. 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;
s. The occurrence of any Change of Control
or the occurrence of any "Change of Control" as defined in
the Indenture which causes any holder or holders of the
Senior Subordinated Notes to require ACI to repurchase all
or any part of such holder's or holders' Senior Subordinated
Notes;
t. Any redemption, repurchase, defeasance
or pre-payment of principal owing under the Senior
Subordinated Notes, or any portion thereof, is made by any
Borrower prior to the occurrence of Bank Facility
Termination;
u. The Completion Date does not occur on or
before June 30, 1998;
v. ACI sells, transfers, assigns,
hypothecates or otherwise alienates its interest in all or
any portion of the common voting stock of CPI, ACLVI, ACCBI
or ACVI (subject to this provision being first approved by
all necessary Gaming Authorities), other than in connection
with the Stock Pledges; or
w. The failure of the Iowa Gaming
Authorities to grant all necessary approvals and consents in
connection with the execution by ACCBI of the Credit
Agreement and each of the Loan Documents to be executed by
ACCBI.
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 Notes, 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/or Construction
Disbursements and may declare all outstanding unpaid
Indebtedness hereunder and under the Revolving Credit Note
and
<PAGE>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).
b. Terminate the obligation of Swingline
Lender to make any advances under the Swingline Facility and
may declare all outstanding unpaid Indebtedness hereunder
and under the Swingline Note, 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).
c. The Banks and/or Agent Bank may exercise
any and all remedies available to Banks or Agent Bank under
the Loan Documents.
d. In the event Borrowers have failed to
provide any insurance required under Section 5.09, 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.
e. 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, 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
<PAGE>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 Real
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;
b. Next, to the payment in full of any
other amounts due under this Credit Agreement, the Deed of
Trust, or any other Loan Documents (other than the Notes);
c. Next, to the balance of interest
remaining unpaid on the Notes;
d. Next, to the balance of principal
remaining unpaid on the Notes;
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.
<PAGE> 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 applicable Gaming Authority as 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
Notes, 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.
<PAGE> 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 Notes, 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 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 Five Hundred Thousand Dollars
($500,000.00), such amount shall be paid directly to
Borrowers unless an Event of Default shall have occurred and
then be continuing. In the event the amount paid to Agent
Bank is greater than Five Hundred Thousand Dollars
($500,000.00), then at the option of Borrowers, unless an
Event of Default 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, the
entire amount received shall reduce the Maximum Principal
Balance and Borrowers shall not be entitled to any further
disbursements or Borrowings hereunder. 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
<PAGE>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 restora
tions;
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 Casino 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 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,
<PAGE>loss or rental income in connection with the Casino
Facility or Collateral Property damaged, destroyed or
condemned accruing and immediately forthcoming to the Agent
Bank) to be sufficient to service 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 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
CONSTRUCTION DISBURSEMENT PROCEDURES
Upon the satisfaction of all the terms and
conditions set forth in Article III A of this Credit
Agreement, on the Closing Date, and satisfaction of all
terms and conditions set forth in Article III B and C of
this Credit Agreement on or before the applicable Initial
Disbursement Date and Article III D with respect to Option
Disbursements,
<PAGE>Construction Disbursements shall be disbursed or
approved for payment by Lenders in the manner and subject to
the conditions provided hereunder.
Section 9.01. Advance of Construction
Disbursements. The Plans and Specifications and
Construction Budgets shall be reviewed and approved by Agent
Bank and Lenders' Consultant as provided herein.
Construction Disbursements shall be made to Borrowers in
accordance with the Construction Budgets for work performed
or materials supplied to the ACLVI Project or suitably
stored in bonded warehouses located in Clark County, Nevada,
which are first approved by Agent Bank in connection with
the ACLVI Project. Construction Disbursements for Soft
Costs and Hard Costs shall be disbursed in no event more
than once a month in anticipation of the completion of the
ACLVI Project by the end of the Construction Period. For
each Construction Disbursement, Borrowers shall submit:
(a) a Construction Disbursement Request, to Agent Bank,
Lenders' Consultant and each of the Lenders accompanied by
invoices or statements totalling the amount for which each
Construction Disbursement is requested, and (b) a line item
reconciliation of each of the Construction Budgets setting
forth for each line item the amount paid to date, the
amounts due and owing but not yet paid by Borrowers and
budgeted amounts which have not been paid and are not due
and owing. Lenders shall disburse such funds monthly in
payment of such approved Construction Disbursement Requests,
bills and invoices in a timely manner, but in no event later
than ten (10) days following the date such proper request is
approved by Agent Bank and Lender's Consultant in accordance
with the requirements of Article IX. If the tenth (10th) day
following the date of such proper request is not a Banking
Business Day, the date for payment shall be the next Banking
Business Day.
Section 9.02. Disbursement for Soft Costs. All
Construction Disbursements made hereunder for Soft Costs of
the ACLVI Project, including those portions of the cost of
purchased FF&E, shall be made by Lenders in accordance with
Section 9.01 as the work progresses upon written application
and certificate of Borrowers to Agent Bank as set forth in a
Construction Disbursement Request.
Section 9.03. Disbursement for Hard Costs. Each
Construction Disbursement Request for Hard Costs shall be
certified by ACLVI and General Contractor with respect to
components of the Structural Plans and Specifications and by
ACLVI with respect to components of the Interior Plans and
<PAGE>Specifications prior to submission to Agent Bank and
the Lenders. Each Construction Disbursement Request for
Hard Costs shall be further supported by invoices,
statements and other forms reasonably requested by Agent
Bank (AIA Forms G702 or forms substantially similar thereto
if first approved by Agent Bank). Each Subcontractor,
material and labor supplier for whose labor or work of
improvement such Construction Disbursement is made, together
with the General Contractor, shall, prior to the
Construction Disbursement next requested, execute and
deliver labor and/or materialmen mechanics lien releases in
favor of Borrowers, Agent Bank and Lenders releasing all
lien rights and claims as of the date of such prior
Construction Disbursement to the extent of payment received.
Each Construction Disbursement Request shall be submitted to
Lenders' Consultant at the address set forth in the Lenders'
Consultant Contract and to Agent Bank and each of the
Lenders in accordance with Section 11.03.
Section 9.04. A Construction Disbursement Does
Not Mean Approval of Work or Materials. Each Construction
Disbursement Request shall be subject to the approval of
Agent Bank and Lenders' Consultant, but the making of any
Construction Disbursement or part thereof shall not
constitute an approval or acceptance of the work or
material, nor be binding upon Agent Bank, Lenders and
Lenders' Consultant, except to the extent that the facts
actually are as so represented when so approved, nor shall
such approval give rise to any liability or responsibility
related to:
(i) the quality of the work, the quantity of
the work, the rate or progress in completion of the work, or
the sufficiency of materials or labor being supplied in
connection therewith; and
(ii) any errors, omissions, inconsistencies
or other defects of any nature in the Plans and
Specifications. Any inspection of the work that Agent Bank,
Lenders and Lenders' Consultant may choose to make, whether
through any consulting engineer, agent or employee or
officer, during the progress of the work shall be solely for
Agent Bank's and Lenders' information and under no
circumstances will any such inspection be deemed to have
been made for the purpose of supervising or superintending
the work, or for the information or protection of any right
or interest of any Persons or entities other than Agent Bank
and Lenders.
Section 9.05. Method of Disbursement. All
Construction Disbursements for payment of approved Hard
Costs
<PAGE>and for approved Soft Costs shall be payable to ACLVI
or in the sole and absolute discretion of Agent Bank jointly
to ACLVI and the Person to whom payment is due. However, in
no event shall Banks be liable for any liens or encumbrances
which may be filed against the ACLVI Real Property, and
ACLVI agrees to remove any liens or encumbrances filed
against the ACLVI Real Property in accordance with Section
5.03.
Section 9.06. Changes in the Construction Budgets
and Work to be Performed Under the Plans and Specifications.
The Project Development Budget shall be a detailed line item
construction budget for the ACLVI Project (inclusive of all
items shown on the General Contractor's Budget and the
Borrower Construction Budget), which budget shall include a
contingency reserve ("Contingency Reserve") as of the
Closing Date in the amount of Three Million One Hundred
Ninety-One Thousand Four Hundred Twenty-Eight Dollars
($3,191,428.00). Borrowers may make usual and ordinary
changes in the work to be performed under the Plans and
Specifications during the Construction Period provided
Borrowers shall not approve any single change order to the
General Contractor's Agreement or to any Major Subcontract
exceeding the amount of One Hundred Thousand Dollars
($100,000.00) without the prior written consent of Agent
Bank. All increases to a line item amount as shown on the
Project Development Budget shall be deducted from the
Contingency Reserve. Any decreases to a line item amount as
shown on the Project Development Budget shall be added to
the Contingency Reserve. Borrowers shall be entitled to
utilize savings in any completed line item by adding such
savings to the Contingency Reserve which shall be reported
monthly on a Contingency Transaction Ledger to be prepared
in connection with the ACLVI Project. In this regard,
Borrowers shall prepare a "Contingency Transaction Ledger"
each month which shall detail increases and decreases to
budget line items and the Contingency Reserve as shown on
the Project Development Budget. All change orders to the
General Contractor's Agreement or to any Major Subcontract
and changes to budget line items and the Contingency Reserve
shall be detailed on the Contingency Transaction Ledger and
Borrowers shall further provide Agent Bank with copies of
all change orders for the portions of the ACLVI Project to
which such Construction Disbursement relates. When the
aggregate of all change orders to the General Contractor's
Agreement or to any Major Subcontract and changes to budget
line items in connection with the ACLVI Project results in a
net decrease to the Contingency Reserve in the amount of One
Million Dollars ($1,000,000.00) or more, Borrowers shall not
approve any further change orders to the General
Contractor's Agreement or
<PAGE>any Major Subcontract or any further changes to budget
line items, regardless of amount, without the prior written
consent of Agent Bank and all additional costs shall be
first approved in writing by Agent Bank. When the aggregate
of all change orders to the General Contractor's Agreement
or to any Major Subcontracts and changes to budget line
items results in a net decrease to the Contingency Reserve
in the amount of Three Million Dollars ($3,000,000.00), or
more, Borrowers shall not approve any further change orders
of further changes to budget line items, regardless of
amount, without the prior written consent of Requisite
Lenders. Further, all re-allocations of line items on the
Project Development Budget greater than ten percent (10%) of
any budgeted line item shall be first consented to by Agent
Bank upon the approval of Requisite Lenders.
Notwithstanding the foregoing, no structural changes to the
Structural Plans and Specifications (other than minor
changes not inconsistent with the Plans and Specifications
taken as a whole) shall be made without the prior written
consent of Agent Bank. Subject to the provisions set forth
hereinabove, within the foregoing limitations, the amounts
allocated on the Project Development Budget for Contingency
Reserve may be allocated amongst the other line item
categories at the discretion of Borrowers.
Section 9.07. Conditions Precedent to
Construction Disbursement. No Construction Disbursement
shall be made to Borrowers with respect to the ACLVI Project
until:
a. Agent Bank and Lenders' Consultant
shall have completed Construction Cost Analysis as of the
applicable Funding Date and have reviewed and approved as
adequate the Plans and Specifications and all engineering
reports and any subsequent change orders to the General
Contractor's Agreement or to any Major Subcontract or
modification to the Plans and Specifications, and the
Project Development Budget, each review of which shall be
completed on or before ten (10) Banking Business Days after
receipt of such Plans and Specifications and/or engineering
reports or on or before five (5) Banking Business Days with
respect to change orders to the General Contractor's
Agreement or any Major Subcontract;
b. Borrowers shall have actually paid for,
other than the work of improvement for which the
Construction Disbursement Request relates, all of the costs
of the ACLVI Project as set forth on the itemized Project
Development Budget (other than such costs incurred as:
(i) have not been billed or invoiced to Borrowers, or (ii)
for which Borrowers have received such billing or invoice
within fifteen (15) days
<PAGE>of such Construction Disbursement Request, or (iii)
Borrowers dispute or contest such costs in good faith) for
work completed on the ACLVI Project to the date of
commencement of the period covered by such Construction
Disbursement Request, less the Retainage required hereby;
c. Borrowers and Lenders' Consultant shall
have certified to Agent Bank that to the date of such
Construction Disbursement Request the ACLVI Project has been
constructed in substantial compliance with the approved
Plans and Specifications and any change orders theretofore
issued and in substantial compliance with all necessary
Governmental Authorities, ordinances and regulations;
d. ACLVI, to the best of its knowledge,
the General Contractor and Lenders' Consultant shall have
certified to Agent Bank that the portion of the ACLVI
Project to be constructed by the General Contractor under
the General Contractor's Agreement can be completed in
overall compliance with the General Contractor's Budget and
that portion of the Project Development Budget allocated for
payment to the General Contractor;
e. ACLVI shall have certified to Agent
Bank, to the best of its knowledge, and Lenders' Consultant
shall have approved such certification, that the ACLVI
Project can be completed in substantial compliance with the
Plans and Specifications and the Project Development Budget
for an aggregate amount of Construction Completion Costs
equal to or less than the amount of Available Borrowings for
Construction Disbursement under the Construction Loan
Subfacility;
f. Additionally, no Construction
Disbursement shall be made to Borrowers if, in the opinion
of Lenders' Consultant, the value of the construction in
place on the site and materials delivered and suitably
stored on site or in a warehouse acceptable to Agent Bank
and insured for at least the value of such material in a
manner satisfactory to Agent Bank is less than the total of
all costs disbursed in connection with the construction of
the ACLVI Project. However, Construction Disbursements
shall resume when said value exceeds the total of all costs
disbursed. If at any time Lenders' Consultant or Agent Bank
determine as a result of a Construction Cost Analysis that
as of the date of such determination the aggregate amount of
Construction Completion Costs exceeds the then amount of
Available Borrowings for Construction Disbursement under the
Construction Loan Subfacility (the amount of such excess, as
the same may exist
<PAGE>at any time or from time to time, being herein
referred to as a "Construction Overage"), Borrowers shall
have ten (10) days from written notice thereof from Agent
Bank in which to: (i) increase the Available Borrowings by
reducing the Aggregate Outstanding by the amount of such
Construction Overage, (ii) deposit in an interest bearing
account with Agent Bank, Cash in the amount of such
Construction Overage, which Cash shall be disbursed by Agent
Bank for the payment of such Construction Overages prior to
the making of any further Construction Disbursements, or
(iii) make alternative arrangements satisfactory to
Requisite Lenders for the payment of Borrower Construction
Expenditures in the amount of such Construction Overage. In
the event of (ii) above, Borrowers shall have the right to
select the type of interest bearing account so as to
maximize the interest to be earned which shall accrue to the
benefit of Borrowers. In the event of a Construction
Overage, all Construction Disbursements for the ACLVI
Project shall cease until Borrowers shall have complied with
the requirements set forth in Subsections 9.07(f)(i), (ii)
or (iii) hereinabove; and
g. Agent Bank and Lenders' Consultant
shall have approved each Construction Disbursement Request
and/or payments made by Borrowers for items as shown on the
Project Development Budget.
By Borrowers requesting Construction Disbursements
under this Article IX, Borrowers shall be deemed to have
reaffirmed all representations and warranties contained in
Article IV and confirmed that Borrowers are in full
compliance with each covenant contained in Article V
concurrently with the making of each Construction
Disbursement Request.
Section 9.08. No Obligation to See to Proper
Application of Construction Disbursements. Nothing
contained herein or in any other documents and agreements
contemplated hereby or executed approximately simultaneously
herewith shall impose upon Banks any obligation to see to
the proper application of any Construction Disbursements by
Borrowers, the Architect, the General Contractor or
Subcontractors, and nothing shall prevent Lenders, at their
option, from deducting from any Construction Disbursements
any sums owed to Banks by Borrowers for unpaid interest or
principal, or for sums paid and expended by Lenders for
taxes, assessments, insurance and other like payments (after
the expiration of any applicable notice and cure period),
pursuant to their rights under the terms of this Credit
Agreement, the Notes or the Deeds of Trust.
<PAGE> Section 9.09. No Construction Disbursements
Required in Event of Default. Lenders shall not be required
to make any Construction Disbursements hereunder if, at the
time when a Construction Disbursement Request is made, there
exists an Event of Default hereunder or under any of the
other Loan Documents; provided, however, Lenders may, in
their sole discretion upon the approval of Requisite
Lenders, make Construction Disbursements notwithstanding the
existence of an Event of Default and any Construction
Disbursements so made shall be deemed to have been made
pursuant to this Credit Agreement.
Section 9.10. No Construction Disbursements
Required if Cloud on Title Exists. Lenders shall not be
obligated to make any Construction Disbursements while there
is any lien or encumbrance upon the Collateral Properties,
other than the Permitted Encumbrances or as provided in
Sections 5.03 and 5.10 hereof, which, in the reasonable
opinion of counsel for Lenders, may invalidate or have
priority over the encumbrance, liens and security interests
granted pursuant to the Deeds of Trust.
Section 9.11. Indorsement from Title Insurance
Company. Title Insurance Company shall update the Title
Insurance Policy issued as of the Closing Date in favor of
Lenders concurrently with each Construction Disbursement at
Borrowers' expense insuring Agent Bank on behalf of Lenders
against any further liens, encumbrances or exceptions to the
state of title to the ACLVI Real Property as of the date of
each advance. Each such update shall be in the form of a
written 122 Indorsement (except for the final indorsements
as provided in Section 9.15) to the ACLVI Title Insurance
Policy together with any other indorsements which Lenders
reasonably require. Additionally, Borrowers shall cause
Title Insurance Company to issue its 102.5 Foundation
Indorsement to the ACLVI Title Insurance Policy upon
completion of the foundations for the ACLVI Project as set
forth in the Plans and Specifications and shall deliver or
cause to be delivered an "as built" survey of the ACLVI
Project within ninety (90) days following the Completion
Date.
Section 9.12. Ownership of all Materials Used on
the ACLVI Project. All materials incorporated into the
construction of the ACLVI Project, other than ACLVI FF&E
leased by Borrowers in accordance with this Credit
Agreement, shall have been purchased and paid for in a
timely manner so that the absolute ownership thereof shall
have vested in Borrowers, subject to any purchase money
security or leasehold
<PAGE>interest allowed under Section 6.08 herein, and
Borrowers shall have furnished to Agent Bank, if required by
Agent Bank, copies of the contracts, bills of sale, lease or
other agreements under which title or possession thereto is
claimed.
Section 9.13. Accuracy of Representations and
Warranties. Lenders shall not be required to make any
Construction Disbursements unless and until the
representations and warranties contained in Article IV of
this Credit Agreement are true and correct in all material
respects on and as of the date of such Construction
Disbursement, as though made on and as of such date.
Section 9.14. Waiver of Requirements by Requisite
Lenders. Lenders reserve the right, in their sole
discretion upon the approval of Requisite Lenders, from time
to time to make any Construction Disbursements without
regard to any condition herein. The Lenders further reserve
the right to withhold any payment of any statements or
invoices, payment of which is requested, if, in the opinion
of the Agent Bank or Lenders' Consultant, the percentage of
completion is less than indicated by such statement or
invoice.
Section 9.15. Disbursement of Retainage During
Construction Period. Lenders shall retain (collectively the
"Retainage") from the gross amount approved for each
Construction Disbursement for Hard Costs made from the
proceeds of the Construction Loan Subfacility, ten percent
(10%) of the amount of each such Construction Disbursement
for Hard Costs until fifty percent (50%) of the Hard Cost
component of the Project Development Budget has been
expended for work performed and has been verified by the
Lenders' Consultant. Thereafter, so long as no Event of
Default shall have occurred and be continuing no further
Retainage shall be retained from Construction Disbursements
thereafter made unless Lenders are otherwise instructed by
Borrowers. Retainage withheld by Lenders from the proceeds
of the Construction Loan Subfacility shall not bear interest
and shall be deemed not disbursed under the Construction
Loan Subfacility until released as provided hereinbelow.
Notwithstanding the foregoing, Lenders agree to release all
Retainage for construction costs relating to excavation,
footings and structural steel at such time as the respective
work is 100% complete and upon such additional conditions
and requirements as may be required by Agent Bank, to Agent
Bank's reasonable satisfaction including, without
limitation, final lien releases and other evidence that such
work will be, with the release of such retention, fully
paid. All remaining
<PAGE>funds held for Retainage by Lenders shall be released
at such time as:
a. The ACLVI Project has been
substantially completed with only "Punch List" items
remaining to be completed which do not materially impair the
ability of Borrowers to occupy and operate the ACLVI Project
for its intended purpose, no single item exceeding a
completion cost in excess of One Hundred Thousand Dollars
($100,000.00) and the aggregate of such "Punch List" items
not exceeding One Million Dollars ($1,000,000.00) in
substantial compliance with the Plans and Specifications and
the terms and requirements of all Governmental Authorities,
including, without limitation, compliance with the Americans
with Disabilities Act, compliance with which shall be
certified to the best knowledge of the Architect, after due
inquiry and investigation;
b. The ACLVI Project has been accepted by
Borrowers as substantially complete and certified
substantially completed and the "Punch List" shall be
prepared by the Architect, the General Contractor, Interior
Designer and Lenders' Consultant after an inspection which
shall be made within ten (10) days of the filing of the
notice of completion;
c. The General Contractor has made a
satisfactory account that all Hard Costs covered by the
General Contractor's Agreement and Borrowers have made a
satisfactory account that all other Hard Costs shown on the
Borrower Construction Budget and all Soft Costs have been
paid in full, with the exception of the unreleased
Retainage, including, but not by way of limitation, all
material and labor costs and have delivered copies of all
lien releases to Agent Bank and have certified that no
claims with respect to the ACLVI Project remain outstanding,
including any claims which might give rise to a lien or
liens against the ACLVI Project, except for work described
in the "Punch List" or as to which Borrowers are contesting
the validity or amount;
d. The Occupancy Date shall have occurred
and a copy of the temporary or final Certificate of
Occupancy (if temporary, ACLVI agrees to promptly deliver a
copy of the final Certificate of Occupancy to Agent Bank
when received by ACLVI) has been issued to ACLVI by the
appropriate Governmental Authority and a copy thereof
delivered to Agent Bank and ACLVI has taken beneficial
occupancy of the entire ACLVI Project, including, without
limitation, all public areas
<PAGE>which shall be open for the use and occupancy by the
public; and
e. Borrowers have delivered an "as-built"
survey of the ACLVI Project and an "as-built" set of plans
and specifications of the ACLVI Project to Agent Bank.
From the amounts released as provided
hereinabove, one hundred fifty percent (150%) of the
Architect, Interior Designer and Lender's Consultants'
reasonable estimate of the cost of completing the "Punch
List" shall be withheld. Such amounts shall be released
monthly upon Construction Disbursement Request submitted by
Borrowers. Within forty-five (45) days following final
completion of the ACLVI Project, Borrowers shall cause (i)
Lender's Consultant to certify completion of the "Punch
List"; (ii) a notice of completion to be posted on the ACLVI
Real Property and recorded in the Office of the County
Recorder of Clark County at final completion, and
(iii) Title Insurance Company to issue its final 100, 101.2,
102.5 and 103.1 indorsements to the title policy showing no
liens, claims or encumbrances on the ACLVI Real Property
except those approved by Requisite Lenders.
Section 9.16. Construction Disbursements if a
Lender Fails to Provide Funds. Borrowers acknowledge and
agree that each of the Lenders shall only be responsible for
its respective Pro Rata Share of any Construction
Disbursement. In the event any of the Lenders fail to
provide its Pro Rata Share of any Construction Disbursement,
then the remaining Lenders' obligations to provide their
respective Pro Rata Share shall not terminate nor shall
Borrowers' obligation to comply with the terms of this
Credit Agreement and each of the Loan Documents terminate.
If any Lender defaults in providing its Pro Rata Share of
any Construction Disbursement, then Agent Bank and Borrowers
shall use their best efforts to find a replacement lender.
Section 9.17. Possession and Completion of
Construction. Upon the occurrence of any Event of Default,
Borrowers agree, upon the request of Agent Bank at the
direction of Requisite Lenders, to vacate the ACLVI Real
Property and permit Lenders:
a. To enter directly, or through a
receiver or other designated representative, into possession
of the ACLVI Project;
<PAGE> b. To perform or cause to be performed any
and all work and labor necessary, in the discretion of Agent
Bank, to complete the ACLVI Project in accordance with the
Plans and Specifications;
c. To employ security watchmen to protect
the ACLVI Project; and
d. To advance any portion of the
Construction Loan Subfacility not previously advanced
(including any retainage and any reserved funds) to the
extent necessary or desirable, in the sole discretion of
Agent Bank, to complete construction of the ACLVI Project
without substantial departure from the Plans and
Specifications, and if the completion requires a larger sum
than the unadvanced portion of the Construction Loan
Subfacility, to advance such additional funds, all of which
funds so advanced by Lenders shall be deemed to have been
advanced to Borrowers and shall be part of the Indebtedness
evidenced by the Revolving Credit Note and secured by the
Security Documentation. For this purpose, Borrowers
constitute and appoint Agent Bank the true and lawful
attorney-in-fact for Borrowers, with full power of
substitution, to complete the construction of the ACLVI
Project in the name of Borrowers, and hereby empower Agent
Bank as such attorney to take all actions that Agent Bank
considers necessary or desirable in connection therewith,
including but not limited to the following: (i) to use any
funds of Borrowers, including any balance that may be held
in escrow and any funds that may remain unadvanced under
this agreement, for the purpose of completing the ACLVI
Project in substantially the manner called for by the Plans
and Specifications; (ii) to make such additions, changes and
corrections in the Plans and Specifications as Agent Bank
may consider necessary or desirable to complete the ACLVI
Project in substantially the manner contemplated by the
Plans and Specifications; (iii) to employ such contractors,
subcontractors, agents, engineers, architects, inspectors,
attorneys and other Persons as Agent Bank may consider
necessary or desirable for such purposes; (iv) to pay,
settle or compromise all existing or future bills and claims
that are or may be or become liens against the ACLVI Real
Property, or may be necessary or desirable for the
completion of the ACLVI Project or the clearance of title to
the ACLVI Real Property; (v) to execute in the name of
Borrowers all applications and certificates that may be
required by any construction contract; and (vi) to do any
act with respect to the construction of the ACLVI Project
that Borrowers or ACLVI could do on their own behalf. This
power of attorney is a
<PAGE>power coupled with an interest and cannot be revoked
by death or otherwise. Such attorney-in-fact shall also
have power to prosecute and defend all actions or
proceedings in connection with the construction of the ACLVI
Project and to take such action and require such performance
as Agent Bank considers necessary.
ARTICLE X
AGENCY PROVISIONS
Section 10.01. 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 10.10(a) and 10.10(b). Agent Bank
agrees to act as such on the express conditions contained in
this Article X.
b. The provisions of this Article X 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 10.03, 10.09 and 11.10), provided,
however, that the foregoing shall in no way limit Borrowers'
obligations under this Article X. 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.
Section 10.02. Nature of Duties. Agent Bank
shall not have any duties or responsibilities except those
expressly set forth in this Credit Agreement or in the Loan
Documents. The duties of Agent Bank shall be administrative
in nature. Subject to the provisions of Sections 10.05 and
10.07, Agent Bank shall administer the Bank Facilities in
the same manner as it administers its own loans. Promptly
following the effectiveness of this Credit Agreement, Agent
Bank shall send to each Lender a duplicate executed
original, to the extent
<PAGE>the same are available in sufficient numbers, of the
Credit Agreement and a copy of each other Loan Document in
favor of Lenders and a copy of the filed or recorded
Security Documentation, with the originals of the latter to
be held and retained by Agent Bank for the benefit of all
Lenders. Agent Bank shall not have by reason of this Credit
Agreement a fiduciary relationship in respect of any Lender.
Nothing in this Credit Agreement or any of the Loan
Documents, expressed or implied, is intended or shall be
construed to impose upon Agent Bank any obligation in
respect of this Credit Agreement or any of the Loan
Documents except as expressly set forth herein or therein.
Each Lender shall make its own independent investigation of
the financial condition and affairs of the Borrowers and the
Collateral in connection with the making and the continuance
of the Credit Facility hereunder and shall make its own
appraisal of the creditworthiness of the Borrowers and the
Collateral, and, except as specifically provided herein,
Agent Bank shall not have any duty or responsibility, either
initially or on a continuing basis, to provide any Lender
with any credit or other information with respect thereto,
whether coming into its possession before the Closing Date
or at any time or times thereafter.
Section 10.03. Disbursement of Borrowings.
a. Not later than the next Banking
Business Day following receipt of a Notice of Borrowing,
Agent Bank shall send a copy thereof by facsimile to each
other Lender and shall otherwise notify each Lender of the
proposed Borrowing and the Funding Date. Each Lender shall
make available to Agent Bank (or the funding bank or entity
designated by Agent Bank), the amount of such Lender's Pro
Rata Share of such Borrowing in immediately available funds
not later than the times designated in Section 10.03(b).
Unless Agent Bank shall have been notified by any Lender not
later than the close of business (San Francisco time) on the
Banking Business Day immediately preceding the Funding Date
in respect of any Borrowing that such Lender does not intend
to make available to Agent Bank such Lender's Pro Rata Share
of such Borrowing, Agent Bank may assume that such Lender
shall make such amount available to Agent Bank. If any
Lender does not notify Agent Bank of its intention not to
make available its Pro Rata Share of such Borrowing as
described above, but does not for any reason make available
to Agent Bank such Lender's Pro Rata Share of such
Borrowing, such Lender shall pay to Agent Bank forthwith on
demand such amount, together with interest thereon at the
Federal Funds Rate. In any case where a Lender does not for
any reason make available to Agent
<PAGE>Bank such Lender's Pro Rata Share of such Borrowing,
Agent Bank, in its sole discretion, may, but shall not be
obligated to, fund to Borrowers such Lender's Pro Rata Share
of such Borrowing. If Agent Bank funds to Borrowers such
Lender's Pro Rata Share of such Borrowing and if such Lender
subsequently pays to Agent Bank such corresponding amount,
such amount so paid shall constitute such Lender's Pro Rata
Share of such Borrowing. Nothing in this Section 10.03(a)
shall alter the respective rights and obligations of the
parties hereunder in respect of a Defaulting Lender or a Non-
Pro Rata Borrowing.
b. Requests by Agent Bank for funding by
Lenders of Borrowings will be made by telecopy. Each Lender
shall make the amount of its Pro Rata Share of such
Borrowing available to Agent Bank in Dollars and in
immediately available funds, to such bank and account, in
San Francisco, California as Agent Bank may designate, not
later than 9:00 A.M. (San Francisco time) on the Funding
Date designated in the Notice of Borrowing with respect to
such Borrowing.
c. Nothing in this Section 10.03 shall be
deemed to relieve any Lender of its obligation hereunder to
make its Pro Rata Share of Borrowings on any Funding Date,
nor shall any Lender be responsible for the failure of any
other Lender to perform its obligations to advance its Pro
Rata Share of any Borrowing hereunder, and the Pro Rata
Share of the Aggregate Commitment of any Lender shall not be
increased or decreased as a result of the failure by any
other Lender to perform its obligation to advance its Pro
Rata Share of any Borrowing.
Section 10.04. Distribution and Apportionment of
Payments.
a. Subject to Section 10.04(b), payments
actually received by Agent Bank for the account of Lenders
shall be paid to them promptly after receipt thereof by
Agent Bank, but in any event within one (1) Banking Business
Day, provided that Agent Bank shall pay to Lenders interest
thereon, at the Federal Funds Rate from the Banking Business
Day following receipt of such funds by Agent Bank until such
funds are paid in immediately available funds to Lenders.
Subject to Section 10.04(b), all payments of principal and
interest in respect of Funded Outstandings, all payments of
the fees described in this Credit Agreement, and all
payments in respect of any other Obligations shall be
allocated among such other Lenders as are entitled thereto,
in proportion to their respective Pro Rata Shares or
otherwise as provided
<PAGE>herein. Agent Bank shall promptly distribute, but in
any event within one (1) Banking Business Day, to each
Lender at its primary address set forth on the appropriate
signature page hereof or on the applicable Assignment and
Assumption Agreement, or at such other address as a Lender
may request in writing, such funds as it may be entitled to
receive, provided that Agent Bank shall in any event not be
bound to inquire into or determine the validity, scope or
priority of any interest or entitlement of any Lender and
may suspend all payments and seek appropriate relief
(including, without limitation, instructions from Requisite
Lenders or all Lenders, as applicable, or an action in the
nature of interpleader) in the event of any doubt or dispute
as to any apportionment or distribution contemplated hereby.
The order of priority herein is set forth solely to
determine the rights and priorities of Lenders as among
themselves and may at any time or from time to time be
changed by Lenders as they may elect, in writing in
accordance with Section 11.01, without necessity of notice
to or consent of or approval by Borrowers or any other
Person. All payments or other sums received by Agent Bank
for the account of Lenders (including, without limitation,
principal and interest payments, the proceeds of any and all
insurance maintained with respect to any of the Collateral,
and any and all condemnation proceeds with respect to any of
the Collateral) shall not constitute property or assets of
the Agent Bank and shall be held by Agent Bank, solely in
its capacity as administrative and collateral agent for
itself and the other Lenders, subject to the Loan Documents.
b. Notwithstanding any provision hereof to
the contrary, until such time as a Defaulting Lender has
funded its Pro Rata Share of Borrowing which was previously
a Non Pro Rata Borrowing, or all other Lenders have received
payment in full (whether by repayment or prepayment) of the
principal due in respect of such Non Pro Rata Borrowing, all
principal sums owing to such Defaulting Lender hereunder
shall be subordinated in right of payment to the prior
payment in full of all principal, in respect of all Non Pro
Rata Borrowing in which the Defaulting Lender has not funded
its Pro Rata Share. This provision governs only the
relationship among Agent Bank, each Defaulting Lender, and
the other Lenders; nothing hereunder shall limit the
obligation of Borrowers to repay all Borrowings in
accordance with the terms of this Credit Agreement. The
provisions of this section shall apply and be effective
regardless of whether an Event of Default occurs and is then
continuing, and notwithstanding (i) any other provision of
this Credit Agreement to the
<PAGE>contrary, (ii) any instruction of Borrowers as to
their desired application of payments or (iii) the
suspension of such Defaulting Lender's right to vote on
matters which are subject to the consent or approval of
Requisite Lenders or all Lenders. No Nonusage Fee shall
accrue in favor of, or be payable to, such Defaulting Lender
from the date of any failure to fund Borrowings or reimburse
Agent Bank for any Liabilities and Costs as herein provided
until such failure has been cured, and Agent Bank shall be
entitled to (A) withhold or setoff, and to apply to the
payment of the defaulted amount and any related interest,
any amounts to be paid to such Defaulting Lender under this
Credit Agreement, and (B) bring an action or suit against
such Defaulting Lender in a court of competent jurisdiction
to recover the defaulted amount and any related interest.
In addition, the Defaulting Lender shall indemnify, defend
and hold Agent Bank and each of the other Lenders harmless
from and against any and all Liabilities and Costs, plus
interest thereon at the Default Rate, which they may sustain
or incur by reason of or as a direct consequence of the
Defaulting Lender's failure or refusal to abide by its
obligations under this Credit Agreement.
Section 10.05. Rights, Exculpation, Etc. Neither
Agent Bank, any Affiliate of Agent Bank, nor any of their
respective officers, directors, employees, agents, attorneys
or consultants, shall be liable to any Lender for any action
taken or omitted by them hereunder or under any of the Loan
Documents, or in connection herewith or therewith, except
that Agent Bank shall be liable for its gross negligence or
willful misconduct. In the absence of gross negligence or
willful misconduct, Agent Bank shall not be liable for any
apportionment or distribution of payments made by it in good
faith pursuant to Section 10.04, and if any such
apportionment or distribution is subsequently determined to
have been made in error the sole recourse of any Person to
whom payment was due, but not made, shall be to recover from
the recipients of such payments any payment in excess of the
amount to which they are determined to have been entitled.
Agent Bank shall not be responsible to any Lender for any
recitals, statements, representations or warranties herein
or for the execution, effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Credit
Agreement, any of the Security Documentation or any of the
other Loan Documents, or any of the transactions
contemplated hereby and thereby; or for the financial
condition of the Borrowers or any of their Affiliates.
Agent Bank shall not be required to make any inquiry
concerning either the performance or observance of any
<PAGE>of the terms, provisions or conditions of this Credit
Agreement or any of the Loan Documents or the financial
condition of the Borrowers or any of their Affiliates, or
the existence or possible existence of any Default or Event
of Default.
Section 10.06. Reliance. Agent Bank shall be
entitled to rely upon any written notices, statements,
certificates, orders or other documents, telecopies or any
telephone message believed by it in good faith to be genuine
and correct and to have been signed, sent or made by the
proper Person, and with respect to all matters pertaining to
this Credit Agreement or any of the Loan Documents and its
duties hereunder or thereunder, upon advice of legal counsel
(including counsel for Borrowers), independent public
accountant and other experts selected by it.
Section 10.07. Indemnification. To the extent
that Agent Bank is not reimbursed and indemnified by
Borrowers, Lenders will reimburse, within ten (10) Banking
Business Days after notice from Agent Bank, and indemnify
and defend Agent Bank for and against any and all
Liabilities and Costs which may be imposed on, incurred by,
or asserted against it in any way relating to or arising out
of this Credit Agreement, the Security Documentation or any
of the other Loan Documents or any action taken or omitted
by Agent Bank or under this Credit Agreement, the Security
Documentation or any of the other Loan Documents, in
proportion to each Lender's Pro Rata Share; provided that no
Lender shall be liable for any portion of such Liabilities
and Costs resulting from Agent Bank's gross negligence or
willful misconduct. The obligations of Lenders under this
Section 10.07 shall survive the payment in full of all
Obligations and the termination of this Credit Agreement.
In the event that after payment and distribution of any
amount by Agent Bank to Lenders, any Lender or third party,
including Borrowers, any creditor of Borrowers or a trustee
in bankruptcy, recovers from Agent Bank any amount found to
have been wrongfully paid to Agent Bank or disbursed by
Agent Bank to Lenders, then Lenders, in proportion to their
respective Pro Rata Shares, shall reimburse Agent Bank for
all such amounts. Notwithstanding the foregoing, Agent Bank
shall not be obligated to advance Liabilities and Costs and
may require the deposit by each Lender of its Pro Rata Share
of any material Liabilities and Costs anticipated by Agent
Bank before they are incurred or made payable.
Section 10.08. Agent Individually. With respect
to its Pro Rata Share of the Aggregate Commitment hereunder
<PAGE>and the Borrowings made by it, Agent Bank shall have
and may exercise the same rights and powers hereunder and is
subject to the same obligations and liabilities as and to
the extent set forth herein for any other Lender. The terms
"Lenders", "Requisite Lenders" or any similar terms may
include Agent Bank in its individual capacity as a Lender or
one of the Requisite Lenders, but Requisite Lenders shall
not include Agent Bank solely in its capacity as Agent Bank
and need not necessarily include Agent Bank in its capacity
as a Lender. Agent Bank and any Lender and its Affiliates
may accept deposits from, lend money to, and generally
engage in any kind of banking, trust or other business with
Borrowers or any of their Affiliates as if it were not
acting as Agent Bank or Lender pursuant hereto.
Section 10.09. Successor Agent Bank; Resignation
of Agent Bank; Removal of Agent Bank.
a. Agent Bank may resign from the
performance of all its functions and duties hereunder at any
time by giving at least thirty (30) Banking Business Days'
prior written notice to Lenders and Borrowers, and shall
automatically cease to be Agent Bank hereunder in the event
a petition in bankruptcy shall be filed by or against Agent
Bank or the Federal Deposit Insurance Corporation or any
other Governmental Authority shall assume control of Agent
Bank or Agent Bank's interests under the Bank Facilities.
Further, Lenders (other than Agent Bank) may unanimously
remove Agent Bank at any time upon the occurrence of gross
negligence or wilful misconduct by Agent Bank by giving at
least thirty (30) Banking Business Days' prior written
notice to Agent Bank, Borrowers and all other Lenders. Such
resignation or removal shall take effect upon the acceptance
by a successor Agent Bank of appointment pursuant to clause
(b) or (c).
b. Upon any such notice of resignation by
or removal of Agent Bank, Requisite Lenders shall appoint a
successor Agent Bank which appointment shall be subject to
Borrowers' consent (other than upon the occurrence and
during the continuance of any Event of Default), which shall
not be unreasonably withheld or delayed. Any successor
Agent Bank must be a bank (i) the senior debt obligations of
which (or such bank's parent's senior unsecured debt
obligations) are rated not less than Baa-2 by Moody's
Investors Services, Inc. or a comparable rating by a rating
agency acceptable to Requisite Lenders and (ii) which has
total assets in excess of Ten Billion Dollars
($10,000,000,000.00).
<PAGE> c. If a successor Agent Bank shall not
have been so appointed within said thirty (30) Banking
Business Day period, the retiring or removed Agent Bank,
with the consent of Borrowers (other than upon the
occurrence and during the continuance of any Event of
Default) (which may not be unreasonably withheld or
delayed), shall then appoint a successor Agent Bank who
shall meet the requirements described in subsection (b)
above and who shall serve as Agent Bank until such time, if
any, as Requisite Lenders, with the consent of Borrowers
(other than upon the occurrence and during the continuance
of any Event of Default), appoint a successor Agent Bank as
provided above.
Section 10.10. Consent and Approvals.
a. Each consent, approval, amendment,
modification or waiver specifically enumerated in this
Section 10.10(a) shall require the consent of Requisite
Lenders:
(i) Approval of Borrowings with less
than full compliance with requirements of Article
IIIB and C or Article IX (Section 2.04);
(ii) Consent to modification to
financial reporting requirements or production of
additional financial or other information (Section
5.08);
(iii) Approval of Investments
(Section 6.07);
(iv) Approval of a change in the
method of calculation of any financial covenants,
standards or terms as a result of a change in
accounting principle (Section 6.14);
(v) Direct Agent Bank to declare the
unpaid balance of the Credit Facility fully due
and payable (Section 7.02);
(vi) Direct the disposition of
insurance proceeds or condemnation awards under
certain circumstances (Section 8.02);
(vii) Approval of change orders to the
General Contractor's Agreement and Major
Subcontracts and re-allocations of line items on
the Project Development Budget after the
<PAGE>Contingency Reserve has been reduced by more
than Three Million Dollars ($3,000,000.00) or a
line item of the Project Development Budget
increases by more than ten percent (10%) of the
amount of such line item (Section 9.06);
(viii) Approval of Construction
Disbursements notwithstanding the existence of an
Event of Default (Section 9.09);
(ix) Approval of Construction
Disbursement without regard to any condition
(Section 9.14);
(x) Approve possession of the ACLVI
Project and Completion of Construction upon the
occurrence of an Event of Default (Section 9.17);
(xi) Approval of appointment of
successor Agent Bank (Section 10.09);
(xii) Approval of certain Protective
Advances (Section 10.11(a));
(xiii) Approval of a Post-Foreclosure
Plan and related matters (Section 10.11(e));
(xiv) Consent to action or proceeding
against Borrowers or the Collateral by any Lender
(Section 10.12);
(xv) Except as referred to in
subsection (b) below, approval of any amendment,
modification or termination of this Credit
Agreement, or waiver of any provision herein
(Section 11.01).
b. Each consent, approval, amendment,
modification or waiver specifically enumerated in
Section 11.01 shall require the consent of all Lenders.
c. In addition to the required consents or
approvals referred to in subsection (a) above, Agent Bank
may at any time request instructions from Requisite Lenders
with respect to any actions or approvals which, by the terms
of this Credit Agreement or of any of the Loan Documents,
Agent Bank is permitted or required to take or to grant
without instructions from any Lenders, and if such
instructions are
<PAGE>promptly requested, Agent Bank shall be absolutely
entitled to refrain from taking any action or to withhold
any approval and shall not be under any liability whatsoever
to any Person for refraining from taking any action or
withholding any approval under any of the Loan Documents
until it shall have received such instructions from
Requisite Lenders. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against
Agent Bank as a result of Agent Bank acting or refraining
from acting under this Credit Agreement, the Security
Documentation or any of the other Loan Documents in
accordance with the instructions of Requisite Lenders or,
where applicable, all Lenders. Agent Bank shall promptly
notify each Lender at any time that the Requisite Lenders
have instructed Agent Bank to act or refrain from acting
pursuant hereto.
d. Each Lender agrees that any action taken
by Agent Bank at the direction or with the consent of
Requisite Lenders in accordance with the provisions of this
Credit Agreement or any Loan Document, and the exercise by
Agent Bank at the direction or with the consent of Requisite
Lenders of the powers set forth herein or therein, together
with such other powers as are reasonably incidental thereto,
shall be authorized and binding upon all Lenders, except for
actions specifically requiring the approval of all Lenders.
All communications from Agent Bank to Lenders requesting
Lenders' determination, consent, approval or disapproval (i)
shall be given in the form of a written notice to each
Lender, (ii) shall be accompanied by a description of the
matter or thing as to which such determination, approval,
consent or disapproval is requested, or shall advise each
Lender where such matter or thing may be inspected, or shall
otherwise describe the matter or issue to be resolved,
(iii) shall include, if reasonably requested by a Lender and
to the extent not previously provided to such Lender,
written materials and a summary of all oral information
provided to Agent Bank by Borrowers in respect of the matter
or issue to be resolved, and (iv) shall include Agent Bank's
recommended course of action or determination in respect
thereof. Each Lender shall reply promptly, but in any event
within ten (10) Banking Business Days (the "Lender Reply
Period"). Unless a Lender shall give written notice to
Agent Bank that it objects to the recommendation or
determination of Agent Bank (together with a written
explanation of the reasons behind such objection) within the
Lender Reply Period, such Lender shall be deemed to have
approved of or consented to such recommendation or
determination. With respect to decisions requiring the
approval of Requisite Lenders or all Lenders, Agent Bank
shall
<PAGE>submit its recommendation or determination for
approval of or consent to such recommendation or
determination to all Lenders and upon receiving the required
approval or consent shall follow the course of action or
determination recommended to Lenders by Agent Bank or such
other course of action recommended by Requisite Lenders, and
each non-responding Lender shall be deemed to have concurred
with such recommended course of action.
Section 10.11. Agency Provisions Relating to
Collateral.
a. Agent Bank is hereby authorized on
behalf of all Lenders, without the necessity of any notice
to or further consent from any Lender, from time to time
prior to an Event of Default, to take any action with
respect to any Collateral or Loan Document which may be
necessary to perfect and maintain Liens of the Security
Documentation upon the Collateral granted pursuant to the
Loan Documents. Agent Bank may make, and shall be
reimbursed by Lenders (in accordance with their Pro Rata
Shares), to the extent not reimbursed by Borrowers, for,
Protective Advance(s) during any one (1) calendar year with
respect to the Collateral up to the sum of (i) amounts
expended to pay real estate taxes, assessments and
governmental charges or levies imposed upon such Collateral,
(ii) amounts expended to pay insurance premiums for policies
of insurance related to such Collateral, and (iii) One
Hundred Thousand Dollars ($100,000.00). Protective Advances
in excess of said sum during any calendar year for any
Collateral shall require the consent of Requisite Lenders.
In addition, Agent Bank is hereby authorized on behalf of
all Lenders, without the necessity of any notice to or
further consent from any Lender, to waive the imposition of
the late fees provided for in Section 2.09(a) up to a
maximum of two (2) times per calendar year, including any
extensions.
b. Lenders hereby irrevocably authorize
Agent Bank, at its option and in its discretion, to release
any Security Documentation granted to or held by Agent Bank
upon any Collateral (i) upon Bank Facilities Termination and
repayment and satisfaction of all Borrowings, and all other
Obligations and the termination of this Credit Agreement, or
(ii) if approved, authorized or ratified in writing by Agent
Bank at the direction of all Lenders. Agent Bank shall not
be required to execute any document to evidence the release
of the Security Documentation granted to Agent Bank for the
benefit of Lenders herein or pursuant hereto upon any
Collateral if, in Agent Bank's opinion, such document would
<PAGE>expose Agent Bank to liability or create any
obligation or entail any consequence other than the release
of such Security Documentation without recourse or warranty,
and such release shall not in any manner discharge, affect
or impair the Obligations or any Security Documentation upon
(or obligations of Borrowers in respect of) any property
which shall continue to constitute part of the Collateral.
c. Except as provided in this Credit
Agreement, Agent Bank shall have no obligation whatsoever to
any Lender or to any other Person to assure that the
Collateral exists or is owned by Borrowers or is cared for,
protected or insured or has been encumbered or that the
Security Documentation granted to Agent Bank herein or in
any of the other Loan Documents or pursuant hereto or
thereto have been properly or sufficiently or lawfully
created, perfected, protected or enforced or are entitled to
any particular priority.
d. Should Agent Bank (i) employ counsel for
advice or other representation (whether or not any suit has
been or shall be filed) with respect to any Collateral or
any part thereof, or any of the Loan Documents, or the
attempt to enforce any security interest or Security
Documentation on any of the Collateral, or (ii) commence any
proceeding or in any way seek to enforce its rights or
remedies under the Loan Documents, irrespective of whether
as a result thereof Agent Bank shall acquire title to any
Collateral, either through foreclosure, deed in lieu of
foreclosure or otherwise, each Lender, upon demand therefor
from time to time, shall contribute its share (based on its
Pro Rata Share) of the reasonable costs and/or expenses of
any such advice or other representation, enforcement or
acquisition, including, but not limited to, fees of
receivers or trustees, court costs, title company charges,
filing and recording fees, appraisers' fees and fees and
expenses of attorneys to the extent not otherwise reimbursed
by Borrowers; provided that Agent Bank shall not be entitled
to reimbursement of its attorneys' fees and expenses
incurred in connection with the resolution of disputes
between Agent Bank and other Lenders unless Agent Bank shall
be the prevailing party in any such dispute. Any loss of
principal and interest resulting from any Event of Default
shall be shared by Lenders in accordance with their
respective Pro Rata Shares. It is understood and agreed
that in the event Agent Bank determines it is necessary to
engage counsel for Lenders from and after the occurrence of
an Event of Default, said counsel shall be selected by Agent
Bank.
<PAGE> e. In the event that all or any portion of
the Collateral is acquired by Agent Bank as the result of a
foreclosure or the acceptance of a deed or assignment in
lieu of foreclosure, or is retained in satisfaction of all
or any part of Borrowers' obligations, title to any such
Collateral or any portion thereof shall be held in the name
of Agent Bank or a nominee or subsidiary of Agent Bank, as
agent, for the ratable benefit of Agent Bank and Lenders.
Agent Bank shall prepare a recommended course of action for
such Collateral (the "Post-Foreclosure Plan"), which shall
be subject to the approval of the Requisite Lenders. Unless
a Lender shall give written notice to Agent Bank that it
objects to the recommended Post-Foreclosure Plan or any
alternative Post-Foreclosure Plan as set forth below, within
the Lender Reply Period, such Lender shall be deemed to have
approved such Post-Foreclosure Plan. In the event that
Requisite Lenders do not approve such Post-Foreclosure Plan,
any Lender shall be permitted to submit an alternative Post-
Foreclosure Plan to Agent Bank, and Agent Bank shall submit
any and all such additional Post-Foreclosure Plans to the
Lenders for evaluation and the approval of Requisite
Lenders. In accordance with the approved Post-Foreclosure
Plan, Agent Bank shall manage, operate, repair, administer,
complete, construct, restore or otherwise deal with the
Collateral acquired and administer all transactions relating
thereto, including, without limitation, employing a
management agent, leasing agent and other agents,
contractors and employees, including agents of the sale of
such Collateral, and the collecting of rents and other sums
from such Collateral and paying the expenses of such
Collateral; actions taken by Agent Bank with respect to the
Collateral, which are not provided for in the approved Post-
Foreclosure Plan or reasonably incidental thereto, shall
require the consent of Requisite Lenders by way of
supplement to such Post-Foreclosure Plan. Upon demand
therefor from time to time, each Lender will contribute its
share (based on its Pro Rata Share) of all reasonable costs
and expenses incurred by Agent Bank pursuant to the Post-
Foreclosure Plan in connection with the construction,
operation, management, maintenance, leasing and sale of such
Collateral. In addition, Agent Bank shall render or cause
to be rendered by the managing agent, to each of the
Lenders, monthly, an income and expense statement for such
Collateral, and each of the Lenders shall promptly
contribute its Pro Rata Share of any operating loss for such
Collateral, and such other expenses and operating reserves
as Agent Bank shall deem reasonably necessary pursuant to
and in accordance with the Post-Foreclosure Plan. To the
extent there is net operating income from such Collateral,
Agent Bank shall, in
<PAGE>accordance with all applicable Gaming Laws and the
Post-Foreclosure Plan, determine the amount and timing of
distributions to Lenders. All such distributions shall be
made to Lenders in accordance with their respective Pro Rata
Shares. Lenders acknowledge that if title to any Collateral
is obtained by Agent Bank or its nominee, such Collateral
will not be held as a permanent investment but will be
liquidated as soon as practicable. Agent Bank shall
undertake to sell such Collateral, at such price and upon
such terms and conditions as the Requisite Lenders shall
reasonably determine to be most advantageous. Any purchase
money mortgage or deed of trust taken in connection with the
disposition of such Collateral in accordance with the
immediately preceding sentence shall name Agent Bank, as
agent for Lenders, as the beneficiary or mortgagee. In such
case, Agent Bank and Lenders shall enter into an agreement
with respect to such purchase money mortgage defining the
rights of Lenders in the same Pro Rata Shares as provided
hereunder, which agreement shall be in all material respects
similar to this Article X insofar as the same is appropriate
or applicable.
Section 10.12. Lender Actions Against
Collateral. Each Lender agrees that it will not take any
action, nor institute any actions or proceedings, against
Borrowers or any other obligor hereunder, under the Security
Documentation or under any other Loan Documents with respect
to exercising claims against or rights in any Collateral
without the consent of Requisite Lenders.
Section 10.13. Ratable Sharing. Subject to
Section 10.03 and 10.04, Lenders agree among themselves that
(i) with respect to all amounts received by them which are
applicable to the payment of the Obligations, equitable
adjustment will be made so that, in effect, all such amounts
will be shared among them ratably in accordance with their
Pro Rata Shares, whether received by voluntary payment, by
counterclaim or cross action or by the enforcement of any or
all of the Obligations, or the Collateral, (ii) if any of
them shall by voluntary payment or by the exercise of any
right of counterclaim or otherwise, receive payment of a
proportion of the aggregate amount of the Obligations held
by it which is greater than its Pro Rata Share of the
payments on account of the Obligations, the one receiving
such excess payment shall purchase, without recourse or
warranty, an undivided interest and participation (which it
shall be deemed to have done simultaneously upon the receipt
of such payment) in such Obligations owed to the others so
that all such recoveries with respect to such Obligations
shall be applied ratably in
<PAGE>accordance with their Pro Rata Shares; provided, that
if all or part of such excess payment received by the
purchasing party is thereafter recovered from it, those
purchases shall be rescinded and the purchase prices paid
for such participations shall be returned to that party to
the extent necessary to adjust for such recovery, but
without interest except to the extent the purchasing party
is required to pay interest in connection with such
recovery. Borrowers agree that any Lender so purchasing a
participation from another Lender pursuant to this Section
10.13 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
Borrowers in the amount of such participation. No Lender
shall exercise any setoff, banker's lien or other similar
right in respect to any Obligations without the prior
written approval by Agent Bank.
Section 10.14. Delivery of Documents. Agent
Bank shall as soon as reasonably practicable distribute to
each Lender at its primary address set forth on the
appropriate counterpart signature page hereof, or at such
other address as a Lender may request in writing, (i)copies
of all documents to which such Lender is a party or of which
is executed or held by Agent Bank on behalf of such Lender,
(ii) all documents of which Agent Bank receives copies from
Borrowers pursuant to Article VI and Section 11.03,
(iii) all other documents or information which Agent Bank is
required to send to Lenders pursuant to the terms of this
Credit Agreement, (iv) other information or documents
received by Agent Bank at the request of any Lender, and
(v) all notices received by Agent Bank pursuant to Section
5.20. In addition, within fifteen (15) Banking Business
Days after receipt of a request in writing from a Lender for
written information or documents provided by or prepared by
Borrowers, Agent Bank shall deliver such written information
or documents to such requesting Lender if Agent Bank has
possession of such written information or documents in its
capacity as Agent Bank or as a Lender.
Section 10.15. Notice of Events of Default.
Agent Bank shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default (other
than nonpayment of principal of or interest on the Credit
Facility) unless Agent Bank has received notice in writing
from a Lender or Borrowers referring to this Credit
Agreement or the other Loan Documents, describing such event
or condition and expressly stating that such notice is a
notice of a Default or Event of Default. Should Agent Bank
receive such notice of the occurrence of a Default or Event
of Default, or should
<PAGE>Agent Bank send Borrowers a notice of Default or Event
of Default, Agent Bank shall promptly give notice thereof to
each Lender.
Section 10.16. Servicing Compensation. As
compensation for collecting the payments and otherwise
providing services to Lenders under the Loan Documents,
Agent Bank shall retain for itself from all payments of
interest on the Credit Facility and the Revolving Credit
Note hereunder an amount (the "Servicing Fee") equal to one-
eighth of one percent (0.125%) per annum of the principal
amount of the Credit Facility and the Revolving Credit Note
to which such interest payments relate. The Servicing Fee
shall be deducted from the interest actually paid by
Borrowers in each payment, so that the effective rates of
interest to the respective Lenders shall be:
a. with respect to Base Rate Loans, the
Base Rate plus the Applicable Base Rate Margin, less one-
eighth of one percent (0.125%) with the deducted one-eighth
of one percent (0.125%) to be retained by Agent Bank as a
Servicing Fee; and
b. with respect to LIBOR Loans, the LIBO
Rate plus the Applicable LIBO Rate Margin, less one-eighth
of one percent (0.125%) with the deducted one-eighth of one
percent (0.125%) to be retained by Agent Bank as a Servicing
Fee.
In the event Agent Bank receives less than the
full amount of interest due with respect to any installment
of interest, the amount of the applicable Servicing Fee
shall be proportionately reduced.
ARTICLE XI
GENERAL TERMS AND CONDITIONS
The following terms and conditions shall be
applicable throughout the term of this Credit Agreement:
Section 11.01. Amendments and Waivers. (a) No
amendment or modification of any provision of this Credit
Agreement shall be effective without the written agreement
of Requisite Lenders (after notice to all Lenders) and
Borrowers (except for rights and priorities of Lenders as
amongst themselves as provided in Section 10.04(a) which do
not require the consent of Borrowers), and (b) no
termination or waiver of any provision of this Credit
Agreement, or consent
<PAGE>to any departure by Borrowers therefrom (except as
expressly provided in Section 10.11(a) with respect to
waivers of late fees), shall in any event be effective
without the written concurrence of Requisite Lenders (after
notice to all Lenders), which Requisite Lenders shall have
the right to grant or withhold at their sole discretion,
except that the following amendments, modifications or
waivers shall require the consent of all Lenders:
(i) modify any requirement hereunder that
any particular action be taken by all the Lenders or by the
Requisite Lenders, modify this Section 11.01 or change the
definition of "Requisite Lenders", or remove Agent Bank
under Section 10.09(a), shall be effective unless consented
to by all of the Lenders, without regard to the vote of
Agent Bank as a Lender;
(ii) increase the Aggregate Commitment or the
Syndication Interest of any Lender, release any Collateral
except as specifically provided in the Credit Agreement,
extend the Maturity Date or change any provision expressly
requiring the consent of all Lenders shall be made without
the consent of each Lender; or
(iii) reduce any fees described in
Section 2.10 or extend the due date for, or reduce or
postpone the amount of, any Scheduled Reductions on the
Credit Facility, or reduce the rate of interest or postpone
the payment of interest on the Credit Facility, shall be
made without the consent of all of the Lenders.
No amendment, modification, termination or waiver of any
provision of Article X or any other provision referring to
Agent Bank shall be effective without the written
concurrence of Agent Bank, but only if such amendment,
modification, termination or waiver alters the obligations
or rights of Agent Bank. Any waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which it was given. No notice to or demand on
Borrowers in any case shall entitle Borrowers to any other
further notice or demand in similar or other circumstances.
Any amendment, modification, termination, waiver or consent
effected in accordance with this Section 11.01 shall be
binding on each assignee, transferee or recipient of Agent
Bank's or any Lender's Syndication Interest under this
Credit Agreement or the Credit Facility at the time
outstanding. No modification of Section 2.08 or the
Swingline Note shall be made without the consent of the
Swingline Lender.
<PAGE> Section 11.02. Failure to Exercise Rights.
Nothing herein contained shall impose upon Banks or
Borrowers any obligation to enforce any terms, covenants or
conditions contained herein. Failure of Banks or Borrowers,
in any one or more instances, to insist upon strict
performance by Borrowers or Banks of any terms, covenants or
conditions of this Credit Agreement or the other Loan
Documents, shall not be considered or taken as a waiver or
relinquishment by Banks or Borrowers of their right to
insist upon and to enforce in the future, by injunction or
other appropriate legal or equitable remedy, strict
compliance by Borrowers or Banks with all the terms,
covenants and conditions of this Credit Agreement and the
other Loan Documents. The consent of Banks or Borrowers to
any act or omission by Borrowers or Banks shall not be
construed to be a consent to any other or subsequent act or
omission or to waive the requirement for Banks' or
Borrowers' consent to be obtained in any future or other
instance.
Section 11.03. Notices and Delivery. Unless
otherwise specifically provided herein, any consent, notice
or other communication herein required or permitted to be
given shall be in writing and may be personally served,
telecopied or sent by courier service or United States mail
and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of a telecopy (or
on the next Banking Business Day if such telecopy is
received on a non-Banking Business Day or after 5:00 p.m. on
a Banking Business Day) or four (4) Banking Business Days
after deposit in the United States mail (registered or
certified, with postage prepaid and properly addressed).
Notices to Agent Bank pursuant to Articles II and IX shall
not be effective until received by Agent Bank. For the
purposes hereof, the addresses of the parties hereto (until
notice of a change thereof is delivered as provided in this
Section 11.03) shall be as set forth below each party's name
on the signature pages hereof, or, as to each party, at such
other address as may be designated by such party in an
Assignment and Assumption Agreement or in a written notice
to all of the other parties. All deliveries to be made to
Agent Bank for distribution to the Lenders shall be made to
Agent Bank at the addresses specified for notice on the
signature page hereto and in addition, a sufficient number
of copies of each such delivery shall be delivered to Agent
Bank for delivery to each Lender at the address specified
for deliveries on the signature page hereto or such other
address as may be designated by Agent Bank in a written
notice.
<PAGE> Section 11.04. Modification in Writing. This
Credit Agreement and the other Loan Documents constitute the
entire agreement between the parties and supersede all prior
agreements whether written or oral with respect to the
subject matter hereof, including, but not limited to, any
term sheets furnished by any of the Banks to Borrowers.
Neither this Credit Agreement, nor any other Loan Documents,
nor any provision herein, or therein, may be changed,
waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge or termination
is sought.
Section 11.05. Other Agreements. If the terms
of any documents, certificates or agreements delivered in
connection with this Credit Agreement are inconsistent with
the terms of the Loan Documents, Borrowers shall use their
best efforts to amend such document, certificate or
agreement to the satisfaction of Agent Bank to remove such
inconsistency.
Section 11.06. Counterparts. This Credit
Agreement may be executed by the parties hereto in any
number of separate counterparts with the same effect as if
the signatures hereto and hereby were upon the same
instrument. All such counterparts shall together constitute
but one and the same document.
Section 11.07. Rights, Powers and Remedies are
Cumulative. None of the rights, powers and remedies
conferred upon or reserved to Agent Bank, Banks or Borrowers
in this Credit Agreement are intended to be exclusive of any
other available right, power or remedy, but each and every
such right, power and remedy shall be cumulative and not
alternative, and shall be in addition to every right, power
and remedy herein specifically given or now or hereafter
existing at law, in equity or by statute. Any forbearance,
delay or omission by Agent Bank, Banks or Borrowers in the
exercise of any right, power or remedy shall not impair any
such right, power or remedy or be considered or taken as a
waiver or relinquishment of the right to insist upon and to
enforce in the future, by injunction or other appropriate
legal or equitable remedy, any of said rights, powers and
remedies given to Agent Bank, Banks or Borrowers herein.
The exercise of any right or partial exercise thereof by
Agent Bank, Banks or Borrowers shall not preclude the
further exercise thereof and the same shall continue in full
force and effect until specifically waived by an instrument
in writing executed by Agent Bank or Banks, as the case may
be.
<PAGE> Section 11.08. Continuing Representations. All
agreements, representations and warranties made herein shall
survive the execution and delivery of this Credit Agreement,
the making of the Credit Facility hereunder and the
execution and delivery of each other Loan Document until and
final payment of all sums owing under the Bank Facilities
and each of the Bank Facilities have been irrevocably
terminated.
Section 11.09. Successors and Assigns. All of
the terms, covenants, warranties and conditions contained in
this Credit Agreement shall be binding upon and inure to the
sole and exclusive benefit of the parties hereto and their
respective successors and assigns.
Section 11.10. Assignment of Loan Documents by
Borrowers or Syndication Interests by Lenders.
a. This Credit Agreement and the other Loan
Documents to which Borrowers are a party will be binding
upon and inure to the benefit of Borrowers, the Agent Bank,
each of the Banks, and their respective successors and
assigns, except that, Borrowers may not assign their rights
hereunder or thereunder or any interest herein or therein
without the prior written consent of all the Lenders. Any
attempted assignment or delegation in contravention of the
foregoing shall be null and void. Any Lender may at any
time pledge its Syndication Interest in the Credit Facility,
the Credit Agreement and the Loan Documents to a Federal
Reserve Bank, but no such pledge shall release that Lender
from its obligations hereunder or grant to such Federal
Reserve Bank the rights of a Lender hereunder absent
foreclosure of such pledge.
b. Each Lender may assign all or any part
of its Syndication Interest in the Credit Facility to any
Affiliate of such Lender which is an Eligible Assignee or to
any other Lender without consent and to one or more
financial institutions that are Eligible Assignees with the
prior consent of the Agent Bank and Borrowers (so long as no
Event of Default has occurred and remains continuing), which
consents shall not be unreasonably withheld or delayed;
provided, however, that the minimum amount of each such
assignment shall be Ten Million Dollars ($10,000,000.00), or
such lesser amount as constitutes the remaining amount of a
Lender's Syndication Interest in the Credit Facility (except
that there shall be no minimum assignment among the Lenders
or to their Affiliates), and each assignee Lender (or
assignor if so agreed between the assignee Lender and such
assignor) shall pay to the Agent Bank an assignment fee of
Two Thousand Five
<PAGE>Hundred Dollars ($2,500.00) with respect to each such
assignment. Each such assignment shall be evidenced by an
assignment substantially in the form of the Assignment and
Assumption Agreement. Upon any such assignment, the
assignee financial institution shall become a Lender for all
purposes under the Credit Agreement and each of the Loan
Documents and the assigning Lender shall be released from
its further obligations hereunder to the extent of such
assignment. Agent Bank agrees to give prompt notice to
Borrowers of each assignment made under this
Section 11.10(b) and to deliver to Borrowers each revision
to the Schedule of Lenders' Proportions in Credit Facility
made as a consequence of each such assignment.
c. Each Lender may sell participations for
all or any part of its Syndication Interest in the Credit
Facility; provided, however, that (i) such Lender shall
remain responsible for its total obligations under the
Credit Agreement and each of the Loan Documents, (ii) the
Borrowers and the Agent Bank shall continue to deal solely
with such Lender in connection with such Lender's rights and
obligations under the Credit Agreement and each of the Loan
Documents, and (iii) such Lender shall not sell any
participation under which the participant would have rights
to approve any amendment or waiver relating to the Credit
Agreement or any Loan Document except to the extent any such
amendment or waiver would (w) extend the final Maturity Date
or the date for the payment or any installments of fees,
principal or interest due in respect of the Credit Facility,
(x) reduce the amount of any Scheduled Reduction in respect
to the Credit Facility, (y) reduce the interest rates or
fees applicable to the Credit Facility or (z) release any
material portion of the Collateral. Notwithstanding the
foregoing, the rights of the Lenders to make assignments and
to grant participations shall be subject to the approval by
the Gaming Authorities of the assignee or participant, to
the extent required by applicable Gaming Laws, and to
applicable securities laws.
Section 11.11. Action by Lenders. Whenever
Banks shall have the right to make an election, or to
exercise any right, or their consent shall be required for
any action under this Credit Agreement or the Loan
Documents, then such election, exercise or consent shall be
given or made for all Banks by Agent Bank in accordance with
the provisions of Section 11.01. Notices, reports and other
documents required to be given by Borrowers to Banks
hereunder may be given by Borrowers to Agent Bank on behalf
of Banks, with sufficient copies for distribution to each of
the Banks, and the delivery
<PAGE>to Agent Bank shall constitute delivery to Banks. In
the event any payment or payments are received by a Lender
other than Agent Bank, Borrowers consent to such payments
being shared and distributed as provided herein.
Section 11.12. Time of Essence. Time shall be
of the essence of this Credit Agreement.
Section 11.13. Choice of Law and Forum. This
Credit Agreement shall be governed by and construed in
accordance with the internal laws of the State of Nevada
without regard to principles of conflicts of law, except as
otherwise required by mandatory provisions of applicable
Gaming Laws and except to the extent that the perfection of
any security interests or remedies hereunder in respect of
any particular Collateral are governed by the laws of a
jurisdiction other than the State of Nevada. Borrowers
further agree that the full and exclusive forum for the
determination of any action relating to this Credit
Agreement, the Loan Documents, or any other document or
instrument delivered in favor of Banks pursuant to the terms
hereof shall be either an appropriate Court of the State of
Nevada or the United States District Court or United States
Bankruptcy Court for the District of Nevada, except that
(a) an action to foreclose the Mississippi Deed of Trust or
other ACVI Security Documents, may be brought in any state
or federal court in Warren County, Mississippi, and the
Borrowers hereby irrevocably submit to the jurisdiction
thereof, and (b) an action to foreclose the Iowa Mortgage or
other ACCBI Security Documents may be brought in any state
or federal court in Pottawattamie County, Iowa, and the
Borrowers hereby irrevocably submit to the jurisdiction
thereof.
Section 11.14. Arbitration.
a. Upon the request of any party, whether
made before or after the institution of any legal
proceeding, any action, dispute, claim or controversy of any
kind (e.g., whether in contract or in tort, statutory or
common law, legal or equitable) ("Dispute") now existing or
hereafter arising between the parties in any way arising out
of, pertaining to or in connection with the Credit
Agreement, Loan Documents or any related agreements,
documents, or instruments (collectively the "Documents"),
may, by summary proceedings (e.g., a plea in abatement or
motion to stay further proceedings), bring an action in
court to compel arbitration of any Dispute.
<PAGE> b. All Disputes between the parties shall
be resolved by binding arbitration governed by the
Commercial Arbitration Rules of the American Arbitration
Association. Judgment upon the award rendered by the
arbitrators may be entered in any court having jurisdiction.
c. No provision of, nor the exercise of any
rights under this arbitration clause shall limit the rights
of any party, and the parties shall have the right during
any Dispute, to seek, use and employ ancillary or
preliminary remedies, judicial or otherwise, for the
purposes of realizing upon, preserving, protecting or
foreclosing upon any property, real or personal, which is
involved in a Dispute, or which is subject to, or described
in, the Documents, including, without limitation, rights and
remedies relating to: (i) foreclosing against any real or
personal property collateral or other security by the
exercise of a power of sale under the Security Documentation
or other security agreement or instrument, or applicable
law, (ii) exercising self-help remedies (including setoff
rights) or (iii) obtaining provisional or ancillary remedies
such as injunctive relief, sequestration, attachment,
garnishment or the appointment of a receiver from a court
having jurisdiction before, during or after the pendency of
any arbitration. The institution and maintenance of an
action for judicial relief or pursuit of provisional or
ancillary remedies or exercise of self-help remedies shall
not constitute a waiver of the right of any party, including
the plaintiff, to submit the Dispute to arbitration nor
render inapplicable the compulsory arbitration provision
hereof.
Section 11.15. Waiver of Jury Trial. TO THE
MAXIMUM EXTENT PERMITTED BY LAW, BORROWERS AND EACH OF THE
BANKS EACH MUTUALLY HEREBY EXPRESSLY WAIVE ANY RIGHT TO
TRIAL BY JURY OF ANY ACTION, CAUSE OF ACTION, CLAIM, DEMAND,
OR PROCEEDING ARISING UNDER OR WITH RESPECT TO THIS CREDIT
AGREEMENT, THE NOTES OR ANY OF THE LOAN DOCUMENTS, OR IN ANY
WAY CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
DEALINGS OF BORROWERS AND BANKS WITH RESPECT TO THIS CREDIT
AGREEMENT, THE NOTES OR ANY OF THE LOAN DOCUMENTS, OR THE
TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING, AND IRRESPECTIVE OF WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE. TO THE MAXIMUM
EXTENT PERMITTED BY LAW, BORROWERS AND EACH OF THE BANKS
EACH MUTUALLY AGREE THAT ANY SUCH ACTION, CAUSE OF ACTION,
CLAIM, DEMAND, OR PROCEEDINGS SHALL BE DECIDED BY A COURT
TRIAL WITHOUT A JURY AND THAT THE DEFENDING PARTY MAY FILE
AN ORIGINAL COUNTERPART OF THIS SECTION WITH ANY COURT OR
OTHER TRIBUNAL AS WRITTEN EVIDENCE
<PAGE>OF THE CONSENT OF THE COMPLAINING PARTY TO THE WAIVER
OF ITS RIGHT TO TRIAL BY JURY.
Section 11.16. Scope of Approval and Review.
Any inspection of the Casino Operations or other documents
shall be deemed to be made solely for Banks' internal
purposes and shall not be relied upon by the Borrowers or
any third party. In no event shall Lenders be deemed or
construed to be joint venturers or partners of Borrowers.
Section 11.17. Severability of Provisions. In
the event any one or more of the provisions contained in
this Credit Agreement shall be invalid, illegal or
unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein
shall not in any way be affected or impaired thereby.
Section 11.18. Cumulative Nature of Covenants.
All covenants contained herein are cumulative and not
exclusive of each other covenant. Any action allowed by any
covenant shall be allowed only if such action is not
prohibited by any other covenant.
Section 11.19. Costs to Prevailing Party. If
any action or arbitration proceeding is brought by any party
against any other party under this Credit Agreement or any
of the Loan Documents, the prevailing party shall be
entitled to recover such costs and attorney's fees as the
court in such action or proceeding may adjudge reasonable.
Section 11.20. Expenses.
a. Generally. Borrowers agree upon demand
to pay, or reimburse Agent Bank for, all of Agent Bank's
documented reasonable out-of-pocket costs and expenses of
every type and nature (including travel expenses incurred by
Agent Bank both before and after the Closing Date in
connection with the sale of Syndication Interests in the
Credit Facility) incurred by Agent Bank at any time (whether
prior to, on or after the date of this Credit Agreement) in
connection with (i) any requests for consent, waiver or
other modification of any Loan Document made by Borrowers;
(ii) the negotiation, preparation and execution of this
Credit Agreement (including, without limitation, the
satisfaction or attempted satisfaction of any of the
conditions set forth in Article III), the Security
Documentation and the other Loan Documents and the advance
of Borrowings; (iii) the subordination of any Collateral,
including title charges,
<PAGE>recording fees and reasonable attorneys' fees and
costs incurred in connection therewith; (iv) any appraisals
performed after the occurrence of an Event of Default; (v)
the creation, perfection or protection of the Security
Documentation on the Collateral (including, without
limitation, any fees and expenses for title and lien
searches, local counsel in various jurisdictions, filing and
recording fees and taxes, duplication costs and corporate
search fees); (vi) all reasonable costs and expenses
incurred by Agent Bank in connection with the sale of
Syndication Interests in the Credit Facility; and (vii) the
protection, collection or enforcement of any of the
Obligations or the Collateral, including Protective
Advances.
b. After Event of Default. Borrowers
further agree to pay, or reimburse Agent Bank and Lenders,
for all reasonable out-of-pocket costs and expenses,
including without limitation reasonable attorneys' fees and
disbursements incurred by Agent Bank or Lenders after the
occurrence of an Event of Default (i) in enforcing any
Obligation or in foreclosing against the Collateral or
exercising or enforcing any other right or remedy available
by reason of such Event of Default; (ii) in connection with
any refinancing or restructuring of the credit arrangements
provided under this Credit Agreement in the nature of a
"work-out" or in any insolvency or bankruptcy proceeding;
(iii) in commencing, defending or intervening in any
litigation or in filing a petition, complaint, answer,
motion or other pleadings in any legal proceeding relating
to Borrowers and related to or arising out of the
transactions contemplated hereby; (iv) in taking any other
action in or with respect to any suit or proceeding (whether
in bankruptcy or otherwise); (v) in protecting, preserving,
collecting, leasing, selling, taking possession of, or
liquidating any of the Collateral; or (vi) in attempting to
enforce or enforcing any lien in any of the Collateral or
any other rights under the Security Documentation.
Section 11.21. Setoff. In addition to any
rights and remedies of the Agent Bank provided by law, if
any Event of Default exists, Agent Bank is authorized at any
time and from time to time, without prior notice to any
Borrower, any such notice being waived by the Borrowers to
the fullest extent permitted by law, to set-off and apply
any and all deposits (general or special, time or demand,
provisional or final) at any time held by Agent Bank to or
for the credit or the account of Borrowers against any and
all obligations of Borrowers under the Credit Facilities,
now or hereafter
<PAGE>existing, irrespective of whether or not the Agent
Bank shall have made demand under this Credit Agreement or
any Loan Document and although such amounts owed may be
contingent or unmatured. Agent Bank agrees promptly to
notify the Borrowers (and Agent Bank shall promptly notify
each other Lender) after any such setoff and application
made by Agent Bank; provided, however, that the failure to
give such notice shall not affect the validity of such set-
off and application. The rights of Agent Bank under this
Section 11.21 are in addition to the other rights and
remedies which Agent Bank may have.
Section 11.22. Borrower Waivers and Consents.
a. Each Borrower shall be jointly and
severally liable for the repayment of all sums owing under
the terms of this Credit Agreement and each the Loan
Documents.
b. Each Borrower agrees that neither the
Agent Bank nor any Bank shall have any responsibility to
inquire into the apportionment, allocation or disposition of
any Borrowings, Construction Disbursements or Swingline
Advance as among the Borrowers or within the Borrower
Consolidation.
c. For the purpose of implementing the
joint borrower provisions of this Credit Agreement and each
of the Loan Documents, each Borrower and the Collateral
Affiliate hereby irrevocably appoints each Authorized
Officer as its agent and attorney-in-fact for all purposes
of this Credit Agreement and each of the Loan Documents,
including without limitation the giving and receiving of
notices and other communications, the making of requests
for, or conversions or continuations of, Borrowings, the
execution and delivery of certificates and the receipt and
allocation of disbursements from the Banks.
d. Each Borrower acknowledges that the
handling of the Bank Facilities on a joint borrowing basis
as set forth in this Credit Agreement is solely an
accommodation to Borrowers and is done at their request.
Each Borrower agrees that neither the Agent Bank, nor any
Lender, shall incur any liability to any Borrower as a
result thereof. To induce the Agent Bank and the Lenders to
enter into this Credit Agreement, and in consideration
thereof, in accordance with the provisions set forth in
Section 5.14 of this Credit Agreement, each Borrower hereby
agrees to indemnify the Agent Bank and each Lender and hold
each such entity harmless from and against any and all
liabilities, expenses, losses, damages
<PAGE>and/or claims of damage or injury asserted against
such entity by any Borrower or by any other Person arising
from or incurred by reason of the structuring of the Bank
Facilities as herein provided, reliance by the Agent Bank or
the Lenders on any requests or instructions from any
Borrower or any Authorized Officer, or any other action
taken by the Agent Bank or a Lender under the terms of this
Credit Agreement or any of the Loan Documents at the request
of any Borrower or Authorized Officer. This Section
11.22(d) shall survive termination of this Credit Agreement.
e. Each Borrower represents and warrants to
the Agent Bank and the Lenders that (i) it has established
adequate means of obtaining from each Borrower on a
continuing basis financial and other information pertaining
to the business, operations and condition (financial and
otherwise) of each of the Borrowers and its respective
property, and (ii) each Borrower now is and hereafter will
be completely familiar with the business, operations and
condition (financial and otherwise) of each Borrower, and
its property. Each Borrower hereby waives and relinquishes
any duty on the part of the Agent Bank or any Lender to
disclose to such Borrower any matter, fact or thing relating
to the business, operations or condition (financial or
otherwise) of any Borrower, or the property of any Borrower,
whether now or hereafter known by the Agent Bank or any
Lender at any time through Bank Facilities Termination.
f. Each Borrower acknowledges that the
Aggregate Outstandings, or portions thereof, may derive from
value provided directly to another Borrower and, in full
recognition of that fact, each Borrower consents and agrees
that the Agent Bank and any Lender may, at any time and from
time to time, without notice or demand, and without
affecting the enforceability or security of the Loan
Documents:
(i) accept partial payments on the Bank
Facilities;
(ii) receive and hold additional security or
guaranties for the Bank Facilities or any part
thereof;
(iii) release, reconvey, terminate, waive,
abandon, subordinate, exchange, substitute,
transfer and enforce any security or guaranties,
and apply any security and direct the order or
manner of sale thereof, as the Agent Bank or
<PAGE>Requisite Lenders in their sole and absolute
discretion may determine;
(iv) release any party or any guarantor from
any personal liability with respect to the Bank
Facilities or any part thereof;
(v) settle, release on terms satisfactory to
the Agent Bank or Requisite Lenders or by
operation of applicable laws or otherwise
liquidate or enforce the Bank Facilities and any
security or guaranty in any manner, consent to the
transfer of any security and bid and purchase at
any sale; and/or
(vi) consent to the merger, change or any
other restructuring or termination of the
corporate existence of any other Borrower or any
other Person, and correspondingly restructure the
Bank Facilities, continuing existence of any lien
or encumbrance under any other Loan Document to
which any Borrower is a party or the
enforceability hereof or thereof with respect to
all or any part of the Bank Facilities.
Each Borrower expressly waives any right to
require the Agent Bank or any Lender to marshal
assets in favor of any Borrower, any other party
or any other Person or to proceed against any
other Borrower or any other party or any
Collateral provided by any Borrower or any other
party, and agrees that the Agent Bank and Lenders
may proceed against Borrowers and/or the
Collateral in such order as they shall determine
in their sole and absolute discretion. The Agent
Bank and Lenders may file a separate action or
actions against any Borrower, whether action is
brought or prosecuted with respect to any other
security or against any other Person, or whether
any other Person is joined in any such action or
actions. Each Borrower agrees that the Agent Bank
or Lenders and any other Borrower may deal with
each other in connection with the Bank Facilities
or otherwise, or alter any contracts or agreements
now or hereafter existing between any of them, in
any manner whatsoever, all without in any way
altering or affecting the obligations of such
Borrower under the Loan Documents or the
perfection of the Security
<PAGE>Documentation. Each Borrower expressly
waives any and all defenses now or hereafter
arising or asserted by reason of: (a) any
disability or other defense of any Borrower or any
other party with respect to any Bank Facilities,
(b) the unenforceability or invalidity as to any
Borrower, or any other party of the Bank
Facilities, (c) the unenforceability or invalidity
of any security or guaranty for the Bank
Facilities or the lack of perfection or continuing
perfection or failure of priority of any security
for the Bank Facilities, (d) the cessation for any
cause whatsoever of the liability of any Borrower
or any other party (other than by reason of the
full payment and performance of all Bank
Facilities and the occurrence of Bank Facility
Termination), (e) any failure of the Agent Bank or
any Lender to give notice of sale or other
disposition to any Borrower or any defect in any
notice that may be given in connection with any
sale or disposition, (f) any act or omission of
the Agent Bank or any Lender or others that
directly or indirectly results in or aids the
discharge or release of any Borrower or any other
Person or the Bank Facilities or any other
security or guaranty therefor by operation of law
or otherwise, (g) any law which provides that the
obligation of a surety or guarantor must neither
be larger in amount nor in other respects more
burdensome than that of the principal or which
reduces a surety's or guarantor's obligation in
proportion to the principal obligation, (h) any
failure of the Agent Bank or any Lender to file or
enforce a claim in any bankruptcy or other
proceeding with respect to any Person, (i) the
election by the Agent Bank or any Lender, in any
bankruptcy proceeding of any Person, of the
application or non-application of
Section 1111(b)(2) of the United States Bankruptcy
Code, (j) any extension of credit or the grant of
any lien or encumbrance under Section 364 of the
United States Bankruptcy Code, (k) any use of cash
collateral under Section 363 of the United States
Bankruptcy Code, (l) any agreement or stipulation
with respect to the provision of adequate
protection in any bankruptcy proceeding of any
Person, (m) the avoidance of any lien or
encumbrance in favor of the Agent Bank or any
Lender for any reason, (n) any bankruptcy,
insolvency, reorganization, arrangement,
<PAGE>readjustment of debt, liquidation or
dissolution proceeding commenced by or against any
Person, including any discharge of, or bar or stay
against collecting, all or any of the obligations
(or any interest thereon) in or as a result of any
such proceeding, or (o) any election of remedies
by the Agent Bank or any Lender, even if the
effect thereof is to destroy or impair any
Borrower's right to subrogation, reimbursement,
exoneration, indemnification or contribution.
g. Each Borrower authorizes the Agent Bank
and any Lender, upon the occurrence of any Default Notice
Recording and the acceleration of the Indebtedness then
owing under the Bank Facilities, at their sole option,
without any other notice or demand and without affecting any
of the Bank Facilities or the validity or enforceability of
any liens or encumbrance in favor of the Agent Bank or any
Lender on any Collateral, to foreclose any or all of the
Deeds of Trust by judicial or nonjudicial sale. To the
extent permitted by applicable law, each Borrower expressly
waives any defenses to the enforcement of the Loan Documents
or any liens or encumbrances created or granted under the
Loan Documents or to the recovery by the Agent Bank or any
Lender against any other Borrower or any guarantor or any
other Person liable therefor of any deficiency after a
judicial or nonjudicial foreclosure or sale, even though
such a foreclosure or sale may impair the subrogation rights
of a Borrower and may preclude a Borrower from obtaining
reimbursement or contribution from any other Borrower.
h. Notwithstanding anything to the contrary
elsewhere contained herein or in any other Loan Document to
which any Borrower is a party, each Borrower hereby
expressly agrees with respect to the Borrowers and their
successors and assigns (including any surety) and any other
Person which is directly or indirectly a creditor of the
other Borrowers or any surety for any other Borrower, not to
exercise, until Bank Facility Termination has irrevocably
occurred, any rights at law or in equity to subrogation, to
reimbursement, to exoneration, to contribution, to setoff or
to any other rights that could accrue to a surety against a
principal, to a guarantor against a maker or obligor, to an
accommodation party against the party accommodated, or to a
holder or transferee against a maker, and which such
Borrower may have or hereafter acquire against any of the
Borrowers or any other such Person in connection with or as
a result of such Borrower's execution, delivery and/or
performance of this
<PAGE>Credit Agreement or any other Loan Document to which
such Borrower is a party.
Section 11.23. Agreement to Subordinate Liens on
ACVI Hotel Property and ACCBI Riverboat. Each of the Banks
hereby agree that upon receipt of written request from
Borrowers Agent Bank shall subordinate, without further
consent or authorization of the Banks, the ACVI Hotel Deed
of Trust and applicable ACVI Financing Statements to the
ACVI Hotel Construction Security Documents so long as
Borrowers are in compliance with Section 6.08(d) in all
material respects.
Section 11.24. Designation of Revolving Credit
Note and Credit Agreement as Senior Indebtedness Under Gem
Notes. The undersigned Borrowers hereby designate, with
respect to the Gem Settlement Agreement and each of the Gem
Settlement Notes, all Indebtedness evidenced by the
Revolving Credit Note and this Credit Agreement as Senior
Indebtedness, as such term is defined in the Gem Settlement
Agreement and Gem Settlement Notes.
Section 11.25. Schedules Attached. Schedules
are attached hereto and incorporated herein and made a part
hereof as follows:
Schedule 2.01(a) - Schedule
of Lenders' Proportions in
Credit Facility
Schedule 2.01(c) - Aggregate
Commitment Reduction Schedule
Schedule 3.11(a) - Schedule
of Existing Bank Loan Security
Documents
Schedule 3.11(b) - Schedule
of Intercompany Security
Documents
Schedule 3.18 - Schedule
of Significant Litigation
Schedule 4.15 - Schedules
of Spaceleases
(A)
ACCBI Schedule of
Spaceleases
(B)
ACVI Schedule of
Spaceleases
<PAGE> (C)
CPI Schedule of
Spaceleases
(D)
ACLVI Schedule of
Spaceleases
Schedule 4.16 - Schedules
of Equipment Leases and
Contracts
(A)
ACCBI Schedule of
Equipment Leases and
Contracts
(B)
ACVI Schedule of
Equipment Leases and
Contracts
(C)
CPI Schedule of Equipment
Leases and Contracts
(D)
ACLVI Schedule of
Equipment Leases and
Contracts
Schedule 4.24 - Schedule
of Trademarks, Patents,
Licenses, Franchises, Formulas
and Copyrights
Schedule 4.25 - Schedule
of Contingent Liabilities
Schedule 5.09(o) - Schedule
of General Contractor Minimum
Insurance Requirements
Schedule 6.08 - Schedule
of Liens
Schedule A-1 - ACCBI Fee
Property -Description
Schedule A-2 - IDNR
Parcel - Description
Schedule B-1 - ACVI Fee
Property - Description
Schedule B-2 - Magnolia
Parcel - Description
Schedule B-3 - Brady/Lum
Parcel - Description
Schedule B-4 - Morrison
Parcel - Description
<PAGE> Schedule B-5 - ACVI Hotel
Property -Description
Schedule C-1 - CPI Real
Property - Description
Schedule D-1 - ACLVI Real
Property -Description
Schedule D-2 - Option
Property - Description
Section 11.26. Exhibits Attached. Exhibits are
attached hereto and incorporated herein and made a part
hereof as follows:
Exhibit A - Revolving Credit Note
Exhibit B - Swingline Note
Exhibit C - Notice of Borrowing
- Form
Exhibit D -
Continuation/Conversion Notice -
Form
Exhibit E - Notice of Swingline
Advance - Form
Exhibit F - Compliance
Certificate - Form
Exhibit G - Pricing Certificate
- Form
Exhibit H - Availability Limit
Certificate -Form
Exhibit I - Authorized Officer
Certificate -Form
Exhibit J - Closing Certificate
Exhibit K - Construction
Disbursement Request - Form
Exhibit L - Assignment and
Assumption Agreement - Form
Exhibit M - Legal Opinion -
Form
Exhibit N - Project Development
Budget
<PAGE> IN WITNESS WHEREOF, the parties hereto
have caused this Credit Agreement to be executed as of the
day and year first above written.
BORROWERS:
AMERISTAR CASINOS, INC.,
a Nevada corporation
By /s/ Thomas Steinbauer
Thomas Steinbauer,
Senior Vice President
Address:
3773 Howard Hughes Parkway
Suite 490S
Las Vegas, Nevada 89109
Telephone: (702) 567-7000
Facsimile: (702) 369-8860
<PAGE>CACTUS PETE'S, INC.,
a Nevada corporation
By /s/ Thomas Steinbauer
Thomas Steinbauer,
Vice President
Address:
3773 Howard Hughes Parkway
Suite 490S
Las Vegas, Nevada 89109
Telephone: (702) 567-7000
Facsimile: (702) 369-8860
<PAGE>AMERISTAR CASINO
VICKSBURG,
INC., a Mississippi
corporation
By /s/ Thomas Steinbauer
Thomas Steinbauer,
Vice President
Address:
3773 Howard Hughes Parkway
Suite 490S
Las Vegas, Nevada 89109
Telephone: (702) 567-7000
Facsimile: (702) 369-8860
<PAGE>AMERISTAR CASINO COUNCIL
BLUFFS, INC., an Iowa
corporation
By /s/ Thomas Steinbauer
Thomas Steinbauer,
Vice President
Address:
3773 Howard Hughes Parkway
Suite 490S
Las Vegas, Nevada 89109
Telephone: (702) 567-7000
Facsimile: (702) 369-8860
<PAGE>AMERISTAR CASINO LAS
VEGAS,
INC., a Nevada corporation
By /s/ Thomas Steinbauer
Thomas Steinbauer,
Vice President
Address:
3773 Howard Hughes Parkway
Suite 490S
Las Vegas, Nevada 89109
Telephone: (702) 567-7000
Facsimile: (702) 369-8860
<PAGE>BANKS:
WELLS FARGO BANK,
National Association,
Agent Bank, Lender and
Swingline Lender
By /s/ Casey Potter
Casey Potter,
Vice President
Address:
One East First Street
Reno, NV 89501
Telephone: (702) 334-5631
Facsimile: (702) 334-5637
<PAGE>U.S. BANK,
Lender
By /s/ Kurt Imerman
Name Kurt Imerman
Title Senior Vice President
Address:
One East Liberty
Reno, NV 89501
Attn: Kurt Imerman, S.V.P.
Telephone: (702) 688-6589
Facsimile: (702) 688-6597
<PAGE>DEPOSIT GUARANTY NATIONAL
BANK,
Lender
By /s/ Larry C. Ratzlaff
Name Larry C. Ratzlaff
Title Senior Vice President
Address:
210 East Capitol Street
Jackson, MS 39215-1200
Attn: Larry Ratzlaff, V.P.
Telephone: (601) 968-4749
Facsimile: (601) 354-8315
<PAGE>FIRST NATIONAL BANK OF
CHICAGO,
Lender
By /s/ Mark Isley
Name Mark Isley
Title Vice President
Address:
777 S. Figueroa Street
4th Floor
Los Angeles, CA 90017-5800
Attn: James Junker, V.P.
Telephone: (213) 683-4948
Facsimile: (213) 683-4999
<PAGE>BANKERS TRUST COMPANY,
Lender
By /s/ Gregory P. Shefrin
Name Gregory P. Shefrin
Title Vice President
Address:
One Bankers Trust Plaza
New York, NY 10006
Attn: Gregory Shefrin, V.P.
Telephone: (212) 250-1724
Facsimile: (212) 250-7218
<PAGE>FIRST NATIONAL BANK OF
COMMERCE,
Lender
By /s/ Steven M. Valdes
Name Steven M. Valdes
Title Vice President
Address:
210 Baronne Street
New Orleans, LA 70112
Attn: Steve Valdez, V.P.
Telephone: (504) 561-1645
Facsimile: (504) 561-1738
<PAGE>TRUSTMARK NATIONAL BANK,
Lender
By /s/ David A. Guyton
Name David A. Guyton
Title Vice President
Address:
248 E. Capitol Street, Ste. 610
Jackson, MS 39205-0291
Attn: David Guyton, V.P.
Telephone: (601) 961-6434
Facsimile: (601) 949-6250
<PAGE>IMPERIAL BANK,
Lender
By /s/ Steven K. Johnson
Name Steven K. Johnson
Title Senior Vice President
Address:
999 S. La Cienega Boulveard
Suite 1015
Inglewood, CA 90301
Attn: Steven Johnson, S.V.P.
Telephone: (310) 417-5657
Facsimile: (310) 338-2611
<PAGE>NORWEST BANK OF NEBRASKA,
N.A.,
Lender
By /s/ Michael V. Hinrichs
Name Michael V. Hinrichs
Title Vice President
Address:
1919 Douglas
Omaha, NE 68102
Attn: Deanne Winger
Telephone: (402) 536-2827
Facsimile: (402) 536-2251
_________________________________________________________________
AMERISTAR CASINOS, INC.,
SERIES A AND SERIES B
10 1/2% SENIOR SUBORDINATED NOTES DUE 2004
________________________________________
INDENTURE
Dated as of July 15, 1997
________________________________________
________________________________________
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
________________________________________
<PAGE>CROSS-REFERENCE TABLE
TIA Section Indenture
Section
310(a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(a)(5) 7.08; 7.10
(b) 7.08; 7.10;
12.02
(c) N.A.
311(a) 7.11
(b) 7.11
(c) N.A.
312(a) 2.05
(b) 12.03
(c) 12.03
313(a) 7.06
(b)(1) N.A.
(b)(2) 7.06
(c) 7.06; 12.02
(d) 7.06
314(a) 4.07; 4.08;
12.02
(b) N.A.
(c)(1) 12.04
(c)(2) 12.04
(c)(3) N.A.
(d) N.A.
(e) 12.05
(f) N.A.
315(a) 7.01(b)
(b) 7.05; 12.02
(c) 7.01(a)
(d) 7.01(c)
(e) 6.10
316(a) (last sentence) 2.09
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) N.A.
(b) 6.06
(c) 9.05
317(a)(1) 6.07
(a)(2) 6.08
(b) 2.04
318(a) 12.01
(c) 12.01
____________________
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose,
be deemed to be a part of the Indenture.
<PAGE>TABLE OF CONTENTS
ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE 7
SECTION 1.01. Definitions. 7
SECTION 1.02. Incorporation by Reference of TIA. 28
SECTION 1.03. Rules of Construction. 28
ARTICLE TWO THE NOTES 29
SECTION 2.01. Form and Dating. 29
SECTION 2.02. Execution and Authentication; Aggregate
Principal Amount. 30
SECTION 2.03. Registrar and Paying Agent. 31
SECTION 2.04. Paying Agent To Hold Assets in Trust. 31
SECTION 2.05. Noteholder Lists. 32
SECTION 2.06. Transfer and Exchange. 32
SECTION 2.07. Replacement Notes. 33
SECTION 2.08. Outstanding Notes. 33
SECTION 2.09. Treasury Notes. 33
SECTION 2.10. Temporary Notes. 34
SECTION 2.11. Cancellation. 34
SECTION 2.12. Defaulted Interest. 34
SECTION 2.13. CUSIP Number. 34
SECTION 2.14. Deposit of Money. 35
SECTION 2.15. Restrictive Legends. 35
SECTION 2.16. Book-Entry Provisions for Global
Security. 36
SECTION 2.17. Special Transfer Provisions. 38
ARTICLE THREE REDEMPTION 40
SECTION 3.01. Notices to Trustee. 40
SECTION 3.02. Selection of Notes To Be Redeemed. 40
SECTION 3.03. Notice of Redemption. 40
SECTION 3.04. Effect of Notice of Redemption. 41
SECTION 3.05. Deposit of Redemption Price. 41
SECTION 3.06. Notes Redeemed in Part. 41
SECTION 3.07. Redemption. 42
SECTION 3.08. Mandatory Disposition or Redemption
Pursuant to Gaming Laws. 42
ARTICLE FOUR COVENANTS 43
SECTION 4.01. Payment of Notes. 43
SECTION 4.02. Maintenance of Office or Agency. 44
SECTION 4.03. Corporate Existence. 44
SECTION 4.04. Payment of Taxes and Other Claims. 44
<PAGE>
SECTION 4.05. Maintenance of Properties and Insurance. 45
SECTION 4.06. Compliance Certificate; Notice of
Default. 45
SECTION 4.07. Compliance with Laws. 46
SECTION 4.08. SEC Reports. 46
SECTION 4.09. Waiver of Stay, Extension or Usury Laws. 47
SECTION 4.10. Limitation on Restricted Payments. 47
SECTION 4.11. Limitation on Transactions with
Affiliates. 49
SECTION 4.12. Limitation on Indebtedness. 49
SECTION 4.13. Limitation on Restrictions on
Distributions from Subsidiaries. 51
SECTION 4.14. Change of Control. 51
SECTION 4.15. Limitation on Sales of Assets and
Restricted Subsidiary Stock. 52
SECTION 4.16. Limitation on Issuance and Sale of
Capital Stock of Restricted
Subsidiaries. 54
SECTION 4.17. Limitation on Liens. 54
SECTION 4.18. Limitation of Layered Indebtedness. 54
SECTION 4.19. Limitation on Designations of Restricted
Subsidiaries and Unrestricted
Subsidiaries. 55
SECTION 4.20. Repurchase of Notes on Loss of Material
Gaming License. 56
SECTION 4.21. Limitation on Other Business Activities. 57
SECTION 4.22. Additional Subsidiary Guarantees. 57
SECTION 4.23. Payment for Consents. 57
SECTION 4.24. General Procedures for Purchase of
Notes. 57
ARTICLE FIVE SUCCESSOR CORPORATION 59
SECTION 5.01. Merger, Consolidation and Sale of
Assets. 59
ARTICLE SIX DEFAULT AND REMEDIES 60
SECTION 6.01. Events of Default. 60
SECTION 6.02. Acceleration. 62
SECTION 6.03. Other Remedies. 63
SECTION 6.04. Waiver of Past Defaults. 63
SECTION 6.05. Control by Majority. 63
SECTION 6.06. Rights of Holders To Receive Payment. 63
SECTION 6.07. Collection Suit by Trustee. 64
SECTION 6.08. Trustee May File Proofs of Claim. 64
SECTION 6.09. Priorities. 64
SECTION 6.10. Undertaking for Costs. 65
SECTION 6.11. Restoration of Rights and Remedies. 65
SECTION 6.12. Limitation on Suits. 65
ARTICLE SEVEN TRUSTEE 66
SECTION 7.01. Duties of Trustee. 66
<PAGE>
SECTION 7.02. Rights of Trustee. 67
SECTION 7.03. Individual Rights of Trustee. 68
SECTION 7.04. Trustee's Disclaimer. 68
SECTION 7.05. Notice of Default. 68
SECTION 7.06. Reports by Trustee to Holders. 68
SECTION 7.07. Compensation and Indemnity. 68
SECTION 7.08. Replacement of Trustee. 69
SECTION 7.09. Successor Trustee by Merger, Etc. 70
SECTION 7.10. Eligibility; Disqualification. 70
SECTION 7.11. Preferential Collection of Claims
Against Company. 71
ARTICLE EIGHT DISCHARGE OF INDENTURE; DEFEASANCE 71
SECTION 8.01. Termination of the Company's
Obligations. 71
SECTION 8.02. Legal Defeasance and Covenant
Defeasance. 72
SECTION 8.03. Conditions to Legal Defeasance or
Covenant Defeasance. 73
SECTION 8.04. Application of Trust Money. 75
SECTION 8.05. Repayment to the Company. 75
SECTION 8.06. Reinstatement. 75
ARTICLE NINE AMENDMENTS, SUPPLEMENTS AND WAIVERS 76
SECTION 9.01. Without Consent of Holders. 76
SECTION 9.02. With Consent of Holders. 77
SECTION 9.03. Effect on Senior Indebtedness. 78
SECTION 9.04. Compliance with TIA. 78
SECTION 9.05. Revocation and Effect of Consents. 78
SECTION 9.06. Notation on or Exchange of Notes. 79
SECTION 9.07. Trustee To Sign Amendments, Etc. 79
ARTICLE TEN SUBORDINATION 79
SECTION 10.01.Agreement to Subordinate. 79
SECTION 10.02.Payment to Noteholders. 80
SECTION 10.03.Subrogation of Notes. 81
SECTION 10.04.Authorization by Securityholders. 82
SECTION 10.05.Notice to Trustee. 82
SECTION 10.06.Trustee's Relation to Senior Debt
Holders. 83
SECTION 10.07.No Impairment of Subordination. 84
ARTICLE ELEVEN SUBSIDIARY GUARANTEES 84
SECTION 11.01.Subsidiary Guarantees. 84
SECTION 11.02.Release Following Disposition of Capital
Stock or Designation as an Unrestricted
Subsidiary. 86
SECTION 11.03.Rights of Contribution. 86
SECTION 11.04.Limitation on Liability. 87
<PAGE>
ARTICLE TWELVEMISCELLANEOUS 88
SECTION 12.01.TIA Controls. 88
SECTION 12.02.Notices. 88
SECTION 12.03.Communications by Holders with Other
Holders. 89
SECTION 12.04.Certificate and Opinion as to Conditions
Precedent. 89
SECTION 12.05.Statements Required in Certificate or
Opinion. 89
SECTION 12.06.Rules by Trustee, Paying Agent,
Registrar. 89
SECTION 12.07.Legal Holidays. 90
SECTION 12.08.Governing Law. 90
SECTION 12.09.No Adverse Interpretation of Other
Agreements. 90
SECTION 12.10.No Recourse Against Others. 90
SECTION 12.11.Successors. 90
SECTION 12.12.Duplicate Originals. 90
SECTION 12.13.Severability. 90
SECTION 12.14.Designation of Notes as Senior
Indebtedness Under Gem Notes. 91
SECTION 12.15.Liability of ACCBI. 91
Exhibit A - Form of Note A-1
Exhibit B - Form of Certificate To Be Delivered in
Connection with Transfers to Non-U.S Persons
Pursuant to Regulation S B-1
Exhibit C - Form of Certificate To Be Delivered in
Connection with Transfers to QIBs C-1
Exhibit D - Portions of Final Offering Memorandum D-1
Exhibit E - Form of Supplemental Indenture E-1
Exhibit F - Form of Subsidiary Guarantee F-1
Note: This Table of Contents shall not, for any purpose, be
deemed to be a part of the Indenture.
<PAGE>THIS INDENTURE, dated as of July 15, 1997 is entered
into by and among AMERISTAR CASINOS, INC., a Nevada corporation
(the "Company"), AMERISTAR CASINO LAS VEGAS, INC., a Nevada
corporation, AMERISTAR CASINO VICKSBURG, INC., a Mississippi
corporation, A.C. FOOD SERVICES, INC., a Nevada corporation, AC
HOTEL CORP., a Mississippi corporation, AMERISTAR CASINO COUNCIL
BLUFFS, INC., an Iowa corporation (collectively, the "Initial
Guarantors"), and FIRST TRUST NATIONAL ASSOCIATION, a national
banking corporation (the "Trustee").
The Company has duly authorized the creation of an issue of
10 1/2% Senior Subordinated Notes due 2004 Series A (the "Initial
Notes") and 10 1/2% Senior Subordinated Notes due 2004 Series B
(the "Exchange Notes," and together with the Initial Notes, the
"Notes"; all references to the Initial Notes, the Exchange Notes
and the Notes include the Subsidiary Guarantees endorsed thereon)
and, to provide therefor, the Company has duly authorized the
execution and delivery of this Indenture. All things necessary
to make the Notes, when duly issued and executed by the Company,
and authenticated and delivered hereunder, the valid obligations
of the Company, and to make this Indenture a valid and binding
agreement of the Company, have been done. Except for the receipt
by ACCBI of all requisite approvals under Gaming Laws of this
Indenture and the Subsidiary Guarantee made by ACCBI (as those
terms are defined herein), all things necessary to make each of
the Subsidiary Guarantees, when duly issued and executed by the
Initial Guarantor party thereto, and authenticated and delivered
hereunder, the valid obligations of such Initial Guarantor, and
to make this Indenture a valid and binding agreement of each
Initial Guarantor, have been done.
Each party hereto agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the Holders
of the Notes.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01.Definitions.
"ACCBI" means Ameristar Casino Council Bluffs, Inc., an Iowa
corporation, and its successors.
"ACFSI" means A.C. Food Services, Inc., a Nevada
corporation, and its successors.
"ACHC" means AC Hotel Corp., a Mississippi corporation, and
its successors.
"ACLVI" means Ameristar Casino Las Vegas, Inc., a Nevada
corporation, and its successors.
"ACVI" means Ameristar Casino Vicksburg, Inc., a Mississippi
corporation, and its successors.
<PAGE>"Additional Assets" means (i) any long-term property
or assets (other than Indebtedness and Capital Stock) in a
Related Business; (ii) Capital Stock of a Person that becomes a
Restricted Subsidiary as a result of the acquisition of such
Capital Stock by the Company or another Restricted Subsidiary; or
(iii) Capital Stock, not held by the Company or a Restricted
Subsidiary, constituting a minority interest in any Person that
at such time is a Restricted Subsidiary; provided, however, that,
in the case of clauses (ii) and (iii), such Restricted Subsidiary
is primarily engaged in a Related Business.
"Affiliate" of any specified Person means (i) any other
Person, directly or indirectly, controlling or controlled by or
under direct or indirect common control with such specified
Person or (ii) any other Person who is a director or officer (a)
of such specified Person, (b) of any subsidiary of such specified
Person or (c) of any Person described in clause (i) above. For
the purposes of this definition, "control" when used with respect
to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and
the terms "controlling" and "controlled" have meanings
correlative to the foregoing. For purposes of Section 4.11 only,
"Affiliate" shall also mean any beneficial owner of shares
representing 10% or more of the total voting power of the Voting
Stock (on a fully diluted basis) of the Company or of rights or
warrants to purchase such Voting Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such
beneficial owner pursuant to the first sentence hereof.
"Affiliate Transaction" is defined in Section 4.11.
"Agent" means any Registrar, Paying Agent, or co-Registrar.
"Agent Members" is defined in Section 2.16.
"Asset Disposition" means (i) the direct or indirect sale,
lease, conveyance or other disposition (each referred to for the
purposes of this definition as a "disposition") of any assets
(including, without limitation, by way of a Sale/Leaseback
Transaction) of the Company or any Restricted Subsidiary, and
(ii) the issue or sale by the Company or any of its Restricted
Subsidiaries of Capital Stock of any of the Company's Restricted
Subsidiaries, provided that Asset Disposition shall not include
(a) a disposition by a Restricted Subsidiary to the Company or by
the Company or a Restricted Subsidiary to a Specified Subsidiary
or a Guarantor, (b) a single disposition, or a series of related
dispositions of assets with an aggregate Fair Market Value and a
sale price of less than $2 million, (c) dispositions of inventory
or equipment (including gaming equipment) in the ordinary course
of business or pursuant to an established program for the
maintenance and upgrading of such equipment, (d) for purposes of
Section 4.15 only, a disposition subject to and in accordance
with the limitations set forth under Section 4.10, (e) a sale,
lease, conveyance or other disposition of all or substantially
all of the assets of the Company and its Restricted Subsidiaries,
which disposition will be governed by Section 4.14 and
Article Five, (f) any Event of Loss, or (g) any foreclosure sale
of FF&E pursuant to a Non-Recourse FF&E Financing.
"Attributable Indebtedness" means Indebtedness deemed to be
incurred in respect of a Sale/Leaseback Transaction and shall be,
at the date of determination, the greater of (i) the Fair
<PAGE>Market Value of the property subject to such Sale/Leaseback
Transaction (as determined in good faith by the Board of
Directors) or (ii) the present value (discounted at the actual
rate of interest implicit in such transaction, compounded
annually) of the total obligations of the lessee for rental
payments during the remaining term of the lease included in such
Sale/Leaseback Transaction (including any period for which such
lease has been extended).
"Authenticating Agent" is defined in Section 2.02.
"Average Life" means, as of the date of determination, with
respect to any Indebtedness or Preferred Stock, the quotient
obtained by dividing (i) the sum of the products of the numbers
of years from the date of determination to the dates of each
successive scheduled principal payment of such Indebtedness or
redemption or similar payment with respect to such Preferred
Stock multiplied by the amount of such payment by (ii) the sum of
all such payments.
"Bank Indebtedness" means any and all amounts payable from
time to time under or in respect of the Revolving Credit
Facility, including principal, premium (if any), interest
(including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the
Company whether or not a claim for post-filing interest is
allowed in such proceedings), fees, charges, expenses,
reimbursement obligations, guarantees, indemnities and all other
amounts and other liabilities payable thereunder or in respect
thereof.
"Bankruptcy Law" means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors. All
references to any Section of the Bankruptcy Law are to Title 11,
United States Code.
"Benefited Party" is defined in Section 11.01(d).
"Blockage Notice" is defined in Section 10.02(b).
"Board of Directors" means the Board of Directors of the
Company or any committee thereof duly authorized to act on behalf
of such Board.
"Board Resolution" means a duly adopted resolution of the
Board of Directors in full force and effect at the time of
determination and certified as such by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee.
"Business Day" means each day that is not a Legal Holiday.
"Capitalized Lease Obligations" means an obligation that is
required to be classified and accounted for as a capitalized
lease for financial reporting purposes in accordance with GAAP,
and the amount of Indebtedness represented by such obligation
shall be the capitalized amount of such obligation 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.
"Capital Stock" of any Person means any and all stock,
partnership interests, limited liability company interests,
shares, interests, rights to purchase, warrants, options,
participations
<PAGE>or other equivalents of or interests in (however
designated) equity of such Person, including any Preferred Stock,
but excluding any debt securities convertible or exchangeable
into such equity.
"Cede" is defined in Section 2.01.
"CEDEL" is defined in Section 2.01.
"Change of Control" means the occurrence of any of the
following events: (i) any "person" or "group" (as each such term
is used in Sections 13(d) and 14(d) of the Exchange Act) other
than the Permitted Holders or an underwriter engaged in a firm
commitment underwriting in connection with a public offering of
the Voting Stock of the Company, is or becomes the "beneficial
owner" (as that term is used in Rules 13d-3 and 13d-5 under the
Exchange Act, except that, for purposes of this definition, a
person shall be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage
of time), directly or indirectly, of more than 35% of the total
voting power of the Voting Stock of the Company, and at such time
the Permitted Holders together shall fail to "beneficially own,"
directly or indirectly, a greater percentage of the total voting
power of the Voting Stock of the Company than is "beneficially
owned" by such "person" or "group"; (ii) during any period of 12
consecutive months after the Issue Date, individuals who at the
beginning of such period constituted the Board of Directors of
the Company (together with any new directors whose election or
appointment by such Board of Directors or whose nomination for
election by the stockholders of the Company was approved by an
affirmative vote of not less than a majority of the directors of
the Company 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 Board of Directors then in office;
(iii) the Company consolidates with or merges into another Person
or any Person consolidates with or merges into the Company in any
such event pursuant to a transaction in which the outstanding
Voting Stock of the Company is reclassified into or exchanged for
cash, securities or other property, other than any such
transaction where (a) the outstanding Voting Stock of the Company
is reclassified into or exchanged for Voting Stock of the
surviving corporation that is Capital Stock and (b) the holders
of the Voting Stock of the Company immediately prior to such
transaction own, directly or indirectly, not less than a majority
of the Voting Stock of the surviving corporation immediately
after such transaction in substantially the same proportion as
before the transaction; (iv) the Company sells, leases or
otherwise transfers, directly or indirectly, all or substantially
all of its consolidated assets (including by way of sales of
assets of Subsidiaries) to any Person other than a Restricted
Subsidiary; or (v) the stockholders of the Company shall have
approved any plan of liquidation or dissolution of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" is defined in the preamble, and includes its
successors.
"Consolidated Cash Flow" for any period means the
Consolidated Net Income for such period, plus the following to
the extent deducted in calculating such Consolidated Net Income:
(i) income tax expense, (ii) Consolidated Fixed Charges, (iii)
depreciation expense and (iv) amortization expense, and (v)
preopening costs that are required by GAAP to be charged as an
<PAGE>expense prior to or upon opening, in each case for such
period and, in the case of clauses (i), (iii), (iv) and (v),
determined in accordance with GAAP.
"Consolidated Coverage Ratio" on any date of determination
(a "Transaction Date") means the ratio, on a pro forma basis, of
(a) Consolidated Cash Flow attributable to continuing operations
and businesses (exclusive of amounts attributable to assets
disposed of in Asset Dispositions and operations and businesses
discontinued or disposed of or subject to a License Loss) for the
period of the most recent four consecutive fiscal quarters ended
prior to the date of such determination for which internal
financial statements are available (the "Reference Period"), to
(b) Consolidated Fixed Charges for the Reference Period;
provided, that for purposes of such calculation, (i) Investments
in any Restricted Subsidiary (or any Person which becomes a
Restricted Subsidiary) or an acquisition of assets, which
constitute all or substantially all assets of an operating unit
of a business, and which acquisition occurred during the
Reference Period or subsequent to the Reference Period and on or
prior to the Transaction Date, shall be assumed to have occurred
on the first day of the Reference Period, (ii) transactions
(including, without limitation, the designation of an
Unrestricted Subsidiary or a Restricted Subsidiary) giving rise
to the need to calculate the Consolidated Coverage Ratio shall be
assumed to have occurred on the first day of the Reference
Period, (iii) the incurrence of any Indebtedness or issuance of
any Disqualified Stock during the Reference Period or subsequent
to the Reference Period and on or prior to the Transaction Date
(and the application of the proceeds therefrom to the extent used
to refinance or retire other Indebtedness) shall be assumed to
have occurred on the first day of such Reference Period, (iv)
Indebtedness of any Person that becomes a Restricted Subsidiary
shall be deemed to have been Incurred on the first day of such
Reference Period, and (v) Consolidated Fixed Charges attributable
to interest on any Indebtedness or dividends on any Disqualified
Capital Stock bearing a floating interest (or dividend) rate
shall be computed as if the rate in effect on the Transaction
Date had been the applicable rate for the entire period, unless
the Company or any of its Restricted Subsidiaries is a party to
an Interest Rate Protection Agreement (which shall remain in
effect for the 12-month period immediately following the
Transaction Date) that has the effect of fixing the interest rate
on the date of computation, in which case such rate (whether
higher or lower) shall be used.
"Consolidated Fixed Charges" means, for any period, the
total interest expense of the Company and its Restricted
Subsidiaries determined in accordance with GAAP, plus, to the
extent not included in such interest expense, (i) interest
expense attributable to capital leases, (ii) amortization of debt
discount and debt issuance cost, (iii) capitalized interest, (iv)
non-cash interest expense, (v) accrued interest, (vi)
commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing,
(vii) interest attributable to the Indebtedness of any other
Person for which the Company or any Restricted Subsidiary is
responsible or liable as obligor, guarantor or otherwise
(including Indebtedness Guaranteed pursuant to Guarantees) or
secured by a Lien on assets of the Company or one of its
Restricted Subsidiaries (whether or not such Indebtedness or Lien
is called upon), (viii) net costs associated with Interest Rate
Protection Agreements (including amortization of fees), (ix) the
interest portion of any deferred obligation, (x) Preferred Stock
dividends in respect of all Preferred Stock of the Company or its
Restricted Subsidiaries and Redeemable Stock of the Company held
by Persons other than the Company or a Restricted Subsidiary
multiplied by a fraction, (i) the numerator of which is one and
(ii) the denominator of which is one minus the then current
combined federal,
<PAGE>state and local statutory tax rate of the Company and its
Restricted Subsidiaries, (xi) fees payable in connection with
financings to the extent not included in (ii) above, including
commitment, availability and similar fees and (xii) the cash
contributions to any employee stock ownership plan or similar
trust to the extent such contributions are used by such plan or
trust to pay interest or fees to any Person (other than the
Company) in connection with Indebtedness Incurred by such plan or
trust; provided, however, that there shall be excluded therefrom
any such interest expense of any Unrestricted Subsidiary to the
extent related to Indebtedness that is not Guaranteed or paid by
the Company or any Restricted Subsidiary and is not secured by a
Lien on assets of the Company or one of its Restricted
Subsidiaries (whether or not such Guarantee or Lien is called
upon).
"Consolidated Net Income" means, for any period, the net
income (loss) of the Company and its Subsidiaries determined in
accordance with GAAP; provided, however, that there shall not be
included in such Consolidated Net Income (i) any net income
(loss) of any Person if such Person is not a Restricted
Subsidiary, except that (a) subject to the limitations contained
in (iv) below, the Company's equity in the net income of any such
Person for such period shall be included in such Consolidated Net
Income up to the aggregate amount of cash actually distributed by
such Person during such period to the Company or a Restricted
Subsidiary as a dividend or other distribution (subject, in the
case of a dividend or other distribution to a Restricted
Subsidiary, to the limitations contained in clause (iii) below)
and (b) the Company's equity in a net loss of any such Person
(other than an Unrestricted Subsidiary) for such period shall be
included in determining such Consolidated Net Income, (ii) any
net income (loss) of any Person acquired by the Company or a
Subsidiary in a pooling of interests transaction for any period
prior to the date of such acquisition, (iii) any net income
(loss) of any Restricted Subsidiary if such Subsidiary is subject
to restrictions, directly or indirectly, on the payment of
dividends or the making of distributions by such Restricted
Subsidiary, directly or indirectly, to the Company, except that
(a) subject to the limitations contained in (iv) below, the
Company's equity in the net income of any such Restricted
Subsidiary for such period shall be included in such Consolidated
Net Income up to the aggregate amount of cash that could have
been distributed by such Restricted Subsidiary during such period
to the Company or another Restricted Subsidiary as a dividend
(subject, in the case of a dividend to another Restricted
Subsidiary, to the limitation contained in this clause) and (b)
the Company's equity in a net loss of any such Restricted
Subsidiary for such period shall be included in determining such
Consolidated Net Income, (iv) any gain (but not loss) realized
upon the sale or other disposition of any property, plant or
equipment of the Company or its consolidated Subsidiaries
(including pursuant to any Sale/Leaseback Transaction) which is
not sold or otherwise disposed of in the ordinary course of
business and any gain (but not loss) realized upon the sale or
other disposition of any Capital Stock of any Person, (v) any
extraordinary gain or loss, (vi) write-offs or charges not to
exceed $700,000 attributable to the demolition of the 54 room
hotel owned by ACVI in Vicksburg, and (vii) the cumulative effect
of a change in accounting principles.
"Consolidated Net Worth" means the total of the amounts
shown on the balance sheet of the Company and its consolidated
Subsidiaries, determined on a consolidated basis in accordance
with GAAP, as of the end of the most recent fiscal quarter of the
Company for which internal financial statements are then
available, prior to the taking of any action for the purpose of
which the determination is being made, as (i) the par or stated
value of all outstanding Capital Stock of
<PAGE>the Company plus (ii) paid-in capital or capital surplus
relating to such Capital Stock plus (iii) any retained earnings
or earned surplus less (a) any accumulated deficit and (b) any
amounts attributable to Disqualified Stock.
"Corporate Trust Office" means the office of the Trustee
located at the address specified in Section 12.02 or such other
office as to which the Trustee may give notice to the Company.
"Covenant Defeasance" is defined in Section 8.02(c).
"CPI" means Cactus Pete's, Inc., a Nevada corporation, and
its successors.
"Custodian" means any receiver, trustee, assignee,
liquidator, custodian or similar official under any Bankruptcy
Law.
"Default" means any event which is, or after notice or
passage of time or both would be, an Event of Default.
"Depository" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified
in Section 2.03 as the Depository with respect to the Notes,
until a successor shall have been appointed and become such
pursuant to the terms hereof, and, thereafter, "Depository" shall
mean or include such successor.
"Designated Senior Indebtedness" means (i) the Bank
Indebtedness and (ii) any other Senior Indebtedness that (a) has
an outstanding principal amount of at least $25 million
(including the amount of all unpaid reimbursement obligations
pursuant to letters of credit and the maximum principal amount
available to be drawn under letters of credit, assuming that all
conditions precedent to such drawing could be satisfied), and (b)
has been designated as "Designated Senior Indebtedness" for
purposes hereof in an Officers' Certificate received by the
Trustee.
"Disqualified Stock" of a Person means Redeemable Stock of
such Person as to which the maturity, mandatory redemption,
conversion or exchange or redemption at the option of the holder
thereof occurs, or may occur, on or prior to the first
anniversary of the Stated Maturity of the Notes.
"Euroclear" is defined in Section 2.01.
"Event of Default" is defined in Section 6.01.
"Event of Loss" means, with respect to any property or asset
of the Company or any Restricted Subsidiary, any (i) loss,
destruction or damage of such property or asset; or (ii) any
condemnation, seizure or taking, by exercise of the power of
eminent domain or otherwise, of such property or asset, or
confiscation or requisition of the use of such property or asset.
"Excess Proceeds Offer" is defined in Section 4.15.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
<PAGE>"Exchange Notes" is defined in the preamble and
include the Subsidiary Guarantees endorsed thereon.
"Fair Market Value" means, with respect to any asset or
property, the price which would be negotiated in an arms' length
free market transaction, for cash, between a willing seller and a
willing buyer, neither of whom is under undue pressure or
compulsion to complete the transaction.
"FF&E" means furniture, fixtures or equipment used directly
in the operation of any Gaming Establishment owned or leased by
the Company or its Restricted Subsidiaries.
"Funding Guarantor" is defined in Section 11.03(a).
"GAAP" means generally accepted accounting principles in the
United States of America as in effect as of the Issue Date,
including those set forth in the opinions and pronouncements of
the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant
segment of the accounting profession.
"Gaming Authority" means any of the Nevada Gaming
Commission, the Nevada State Gaming Control Board, the
Mississippi Gaming Commission, the Mississippi State Tax
Commission, the Iowa Racing and Gaming Commission or any agency
(including, without limitation, any agency established by a
federally-recognized Indian tribe to regulate gaming on such
tribe's reservation) which has, or may at any time after the
Issue Date have, jurisdiction over the gaming activities of the
Company or any of its Subsidiaries or any successor to such
authority.
"Gaming Establishment" means any gaming establishment and
all other property, assets or operations directly ancillary
thereto or used in connection therewith, including any building,
restaurant, lounge, hotel, vessel, barge, ship, theater, parking
facilities, retail shops, land, child care centers,
retail/wholesale food and beverage distribution facilities, gas
stations, transportation services, swimming pools, tennis courts,
personal care services, golf courses and other leisure,
recreation and entertainment facilities and equipment.
"Gaming Laws" means the Legal Requirements of a jurisdiction
or jurisdictions to which the Company or any of its Subsidiaries
is, or may at any time after the Issue Date, be subject as a
result of the conduct or proposed conduct of gaming operations.
"Gaming License" means any license, qualification, permit,
franchise or other authorization from any Governmental Authority
required on the date hereof or at any time thereafter to own,
lease, operate or otherwise conduct the gaming business of the
Company and its Subsidiaries, including all licenses, findings of
suitability and registrations granted under Gaming Laws.
"Gem Notes" means those certain subordinated promissory
notes referred to herein as the "Gem Notes," made by the Company
in favor of certain Persons, as in effect on the Issue Date, and
any Refinancing Indebtedness with respect thereto; provided that
(i) the aggregate outstanding principal amount of such notes,
together with the principal amount of any such
<PAGE>Refinancing Indebtedness, does not exceed the sum of (a)
the aggregate initial principal amount thereof described under
"Description of Existing Indebtedness" in the Offering Memorandum
plus (b) any accrued and unpaid interest accrued at the rate set
forth in such notes on the Issue Date that is added to principal,
(ii) the other material terms and conditions of such notes or any
such Refinancing Indebtedness (including the subordination and
enforcement provisions) remain in full force and effect and
conform in all material respects to the description of the "Gem
Notes" under "Description of Existing Indebtedness" in the
Offering Memorandum and (iii) any such note and any such
Refinancing Indebtedness shall cease to constitute a "Gem Note"
at any time when the aggregate amount of "Senior Indebtedness"
(as defined in the Gem Notes) of the Company exceeds $250 million
or such higher amount of "Senior Indebtedness" as is then
permitted under all of the Gem Notes.
"Global Note" is defined in Section 2.01 and includes the
Subsidiary Guarantees endorsed thereon.
"Guarantee" means any obligation, contingent or otherwise,
of any Person directly or indirectly guaranteeing any
Indebtedness or other obligation of any other Person and any
obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation of
such other Person (whether arising by virtue of partnership
arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into
for purposes of assuring in any other manner the obligee of such
Indebtedness or other obligation of the payment thereof or to
protect such obligee against loss in respect thereof (in whole or
in part); provided, however, that the term "Guarantee" shall not
include endorsements for collection or deposit in the ordinary
course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Guarantor" means (i) any Initial Guarantor and (ii) any
other Subsidiary that, pursuant to Section 4.22, has executed and
delivered an indenture supplemental hereto guaranteeing the
Obligations of the Company under the Notes, and their respective
successors, in each case unless and until such Person is released
from its Subsidiary Guarantee in accordance with the applicable
provisions hereof. Notwithstanding the foregoing, for purposes of
Section 4.12, neither CPI nor ACCBI shall be considered a
Guarantor, unless it becomes a Guarantor, or its
previously-executed Guarantee is approved under applicable Gaming
Laws, as the case may be, within 9 months after the Issue Date.
"Holder" or "Noteholder" means a Person in whose name a Note
is registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise
become liable for; provided, however, that any Indebtedness or
Capital Stock of a Person existing at the time such person
becomes a Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be incurred by such
Subsidiary at the time it becomes a Subsidiary. The terms
"Incurred," "Incurrence" and "Incurring" shall each have a
correlative meaning.
<PAGE>"Indebtedness" means, with respect to any Person on
any date of determination (without duplication),
(i) the principal of and premium (if any) in respect
of indebtedness of such Person for borrowed money;
(ii) the principal of and premium (if any) in respect
of obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(iii) all Capitalized Lease Obligations and
Attributable Indebtedness of such Person;
(iv) all obligations of such Person to pay the deferred
and unpaid purchase price of property or services (except
Trade Payables), which purchase price is due more than six
months after the date of placing such property in service or
taking delivery and title thereto or the completion of such
services;
(v) all obligations of such Person in respect of
letters of credit, bankers' acceptances or other similar
instruments or credit transactions (including reimbursement
obligations with respect thereto);
(vi) the amount of all obligations of such Person with
respect to the redemption, repayment or other repurchase of
any Disqualified Stock and, with respect to the Company, any
Disqualified Stock or Preferred Stock of any Restricted
Subsidiary (excluding, in each case, any accrued dividends);
(vii) all Indebtedness of other Persons secured by
a Lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person; provided, however,
that the amount of such Indebtedness shall be the lesser of
(a) the Fair Market Value of such asset at such date of
determination and (b) the amount of such Indebtedness of
such other Persons;
(viii) all Indebtedness of other Persons to the
extent Guaranteed by such Person; and
(ix) to the extent not otherwise included in this
definition, obligations in respect of Interest Rate
Protection Agreements.
The amount of Indebtedness of any Person at any date shall
be the outstanding balance at such date of all unconditional
obligations as described above and the maximum liability, upon
the occurrence of the contingency giving rise to the obligation,
of any contingent obligations at such date.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Independent Director" means a director of the Company other
than a director who is a party, or who is a director, officer,
employee or Affiliate (or is related by blood or marriage to any
<PAGE>such person) of a party, to the transaction in question,
and who is, in fact, independent in respect of such transaction.
"Initial Guarantors" is defined in the preamble and includes
their respective successors.
"Initial Notes" is defined in the preamble and includes the
Subsidiary Guarantees endorsed thereon.
"Interest Payment Date" means February 1 and August 1 of
each year, commencing February 1, 1998.
"Interest Rate Protection Agreement" means, in respect of a
Person, any interest rate swap agreement, interest rate option
agreement, interest rate cap agreement, interest rate collar
agreement, interest rate floor agreement or other similar
agreement or arrangement.
"Investment" in any Person means any direct or indirect
advance, loan (other than advances to customers in the ordinary
course of business that are recorded as accounts receivable on
the balance sheet of the Person making such advances) or other
extension of credit (including by way of Guarantee or similar
arrangement) or capital contribution to (by means of any transfer
of cash or other property to others or any payment for property
or services for the account or use of others), or any purchase or
acquisition of Capital Stock, Indebtedness or other similar
instruments issued by, such Person. Upon a redesignation of any
Subsidiary previously designated as an Unrestricted Subsidiary as
a Restricted Subsidiary, the Company shall be deemed to have a
continuing Investment in an Unrestricted Subsidiary in an amount
equal to the excess, if any, of (i) the net book value of all
outstanding Investments of the Company and any of its Restricted
Subsidiaries in such redesignated Subsidiary at the time of such
redesignation over (ii) the Fair Market Value of such Investments
at the time of such redesignation.
"Issue Date" means the date of original issuance of the
Initial Notes pursuant hereto.
"Legal Defeasance" is defined in Section 8.02(b).
"Legal Holiday" is defined in Section 12.07.
"Legal Requirements" means all laws, statutes and ordinances
and all rules, orders, rulings, regulations, directives, decrees,
injunctions and requirements of all governmental authorities,
that are now or may hereafter be in existence, and that may be
applicable to the Company or any Subsidiary or Affiliate thereof
or the Trustee (including building codes, zoning and
environmental laws, regulations and ordinances), as modified by
any variances, special use permits, waivers, exceptions or other
exemptions which may from time to time be applicable.
"License Loss" is defined in Section 4.20.
"License Loss Amount" is defined in Section 4.20.
"License Loss Offer" is defined in Section 4.20.
<PAGE>"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any
conditional sale or other title retention agreement or lease in
the nature thereof) or any Sale/Leaseback Transaction.
"Liquidated Damages" means all liquidated damages owing
pursuant to Section 4 of the Registration Rights Agreement.
"Maturity Date" means August 1, 2004.
"Maximum Net Worth" is defined in Section 11.03(b).
"Net Available Cash" from an Asset Disposition or Event of
Loss means payments of cash or cash equivalents received
(including any cash payments received by way of deferred payment
of principal pursuant to a note or installment receivable or
otherwise, but only as and when received, but excluding any
consideration received in the form of assumption by the acquiring
person of Senior Indebtedness of the Company or Indebtedness of
any Restricted Subsidiary) therefrom, in each case net of (i) all
legal, title and recording tax expenses, commissions and other
fees and expenses incurred, and all Federal, state, provincial,
foreign and local taxes required to be paid or accrued as a
liability under GAAP (after taking into account any available tax
credits or deductions and any tax sharing arrangements), as a
consequence of such Asset Disposition or Event of Loss, (ii) all
payments made on any Indebtedness which is secured by any assets
subject to such Asset Disposition, in accordance with the terms
of any Lien upon such assets permitted hereunder, or any
Indebtedness (other than Subordinated Obligations) which must by
applicable law be repaid out of the proceeds from such Asset
Disposition, (iii) all distributions and other payments required
to be made to minority interest holders in Subsidiaries or joint
ventures as a result of such Asset Disposition or Event of Loss
and (iv) the deduction of appropriate amounts to be provided by
the seller as a reserve, in accordance with GAAP, against any
liabilities associated with the assets disposed of in such Asset
Disposition and retained by the Company or any Restricted
Subsidiary after such Asset Disposition.
"Net Cash Proceeds," with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale
net of attorneys' fees, accountants' fees, underwriters or
placement agents' fees, discounts or commissions and brokerage,
consultant and other fees actually incurred in connection with
such issuance or sale and net of taxes paid or payable as a
result thereof.
"Net Worth" is defined in Section 11.03(b).
"Non-Payment Default" is defined in Section 10.02(b).
"Non-Recourse FF&E Financing" means Indebtedness of the
Company or any Restricted Subsidiary (i) that is Incurred to
finance the acquisition or lease after the Issue Date of newly
acquired or leased FF&E used in the operation of any Gaming
Establishment owned or leased by the Company or its Restricted
Subsidiaries, (ii) the amount of which, together with any
Refinancing Indebtedness with respect thereto, does not exceed
100% of the lesser of the cost or Fair Market Value of the FF&E
so purchased or leased at the time such Indebtedness is incurred,
<PAGE>and (iii) that is secured by a Permitted Lien on such FF&E
but no other assets; (iv) that provides that no personal recourse
shall be had against the Company or any Restricted Subsidiary for
the payment of such Indebtedness, enforcement being limited to
such FF&E, (v) as to which neither the Company nor any of its
Restricted Subsidiaries (other than the party obligated with
respect thereto) provides any credit support or is liable, under
a Guarantee or otherwise, or constitutes the lender; (vi) as to
which no default on such Indebtedness (including any rights that
the holders thereof may have to take enforcement action against
an Unrestricted Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Indebtedness (other than
the Notes) of the Company or any of its Restricted Subsidiaries
to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated
maturity; provided, however, that any event that results in any
such Indebtedness ceasing to meet any of the foregoing conditions
shall be deemed to constitute the Incurrence of Indebtedness by
the party obligated with respect thereto.
"Non-Recourse Indebtedness" means Indebtedness of a Person
to the extent that under the terms thereof or pursuant to
applicable law (i) neither the Company nor any of its Restricted
Subsidiaries provides any credit support or is liable thereon,
under a Guarantee or otherwise, or constitutes the lender; (ii)
no default with respect to such Indebtedness (including any
rights that the holders thereof may have to take enforcement
action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other
Indebtedness (other than the Notes) of the Company or any of its
Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or
payable prior to its stated maturity; and (iii) the lenders
thereunder will not have any recourse to the stock or assets of
the Company or any of its Restricted Subsidiaries and have been
notified in writing to that effect.
"Non-U.S. Person" means a Person who is not a U.S. Person,
as defined in Rule 902 of Regulation S.
"Notes" is defined in the preamble and includes the
Subsidiary Guarantees endorsed thereon.
"Obligations" means any principal, interest, penalties,
fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any
Indebtedness.
"Obligor" means any of the Company and the Guarantors.
"Offering Memorandum" means the Company's Offering
Memorandum with respect to the Notes, dated July 10, 1997,
certain portions of which are attached hereto as Exhibit D.
"Officer" means the Chairman of the Board, the President,
any Vice President, the Treasurer or the Secretary of the
relevant Obligor.
"Officers' Certificate" means a certificate, in compliance
with Sections 12.04 and 12.05, signed by two Officers at least
one of whom shall be the principal executive officer, principal
accounting officer or principal financial officer of the relevant
Obligor.
<PAGE>"Opinion of Counsel" means a written opinion from
legal counsel who is acceptable to the Trustee, in compliance
with Sections 12.04 and 12.05. The counsel may be an employee of
or counsel to the Company or the Trustee.
"pari passu," as applied to the ranking of any Indebtedness
of a Person in relation to other Indebtedness of such Person,
means that each such Indebtedness either (i) is not subordinate
in right of payment to any Indebtedness or (ii) is subordinate in
right of payment to the same Indebtedness as is the other, and is
so subordinate to the same extent, and is not subordinate in
right of payment to each other or to any Indebtedness as to which
the other is not so subordinate.
"pay the Notes" and "payment of the Notes" are defined in
Section 10.02(a).
"Paying Agent" is defined in Section 2.03.
"Payment Blockage Notice" is defined in Section 10.02(b).
"Permitted Holders" means Craig H. Neilsen, his estate,
spouse, ancestors and their spouses and lineal descendants and
their spouses, the executors, administrators, and legal
representatives of any of the foregoing and the trustee of any
bona fide trust of which any of the foregoing are the sole
beneficiaries, or any Person of which the foregoing "beneficially
owns" (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act) Voting Stock representing at least a majority of the total
voting power of all classes of Capital Stock of such Person.
"Permitted Investment" means an Investment by the Company or
any Restricted Subsidiary in (i) a Guarantor or a Person which
will, upon the making of such Investment, become a Guarantor;
provided, however, that the primary business of such Subsidiary
is a Related Business; (ii) another Person if as a result of such
Investment such other Person is merged or consolidated with or
into, or transfers or conveys all or substantially all of its
assets to, the Company or a Guarantor; provided, however, that
such Person's primary business is a Related Business; (iii)
Temporary Cash Investments; (iv) receivables owing to the Company
or any Restricted Subsidiary, if created or acquired in the
ordinary course of business and payable or dischargeable in
accordance with customary trade terms; provided, however, that
such trade terms may include such concessionary trade terms as
the Company or any such Restricted Subsidiary deems reasonable
under the circumstances; (v) payroll, travel and similar advances
to cover matters that are expected at the time of such advances
ultimately to be treated as expenses for accounting purposes and
that are made in the ordinary course of business; (vi) loans or
advances to employees made in the ordinary course of business
consistent with past practices of the Company or such Restricted
Subsidiary, as the case may be (other than loans or advances to
finance the purchase by such employees of Capital Stock of the
Company or any Subsidiary); (vii) stock, obligations or
securities received in settlement of (or pursuant to any
bankruptcy proceeding involving the obligor under) debts created
in the ordinary course of business and owing to the Company or
any Restricted Subsidiary or in satisfaction of judgments; and
(viii) Investments received as permitted by clause (ii) of the
first paragraph of Section 4.15.
"Permitted Junior Securities" means Capital Stock or any
debt securities that are subordinated to Senior Indebtedness to
at least the same extent as the Notes.
<PAGE>"Permitted Liens" means, with respect to any Person,
(a) pledges or deposits by such Person under workmen's
compensation laws, unemployment insurance laws or similar
legislation, or good faith deposits in connection with bids,
tenders, contracts (other than for the payment of Indebtedness)
or leases to which such Person is a party, or deposits to secure
public or statutory obligations of such Person or deposits of
cash or United States government bonds to secure surety or appeal
bonds to which such Person is a party, or deposits as security
for contested taxes or import duties or for the payment of rent,
in each case Incurred in the ordinary course of business; (b)
Liens imposed by law, such as carriers', warehousemen's and
mechanics' Liens, in each case for sums not yet due or being
contested in good faith by appropriate proceedings, or other
Liens arising out of judgments or awards against such Person with
respect to which such Person shall then be prosecuting an appeal
or other proceedings for review; (c) Liens for property taxes not
yet due or payable or subject to penalties for non-payment and
which are being contested in good faith by appropriate
proceedings; (d) Liens in favor of issuers of surety bonds or
letters of credit issued pursuant to the request of and for the
account of such Person in the ordinary course of its business;
(e) minor survey exceptions, minor encumbrances, easements or
reservations of, or rights of others for, licenses, rights-of-
way, sewers, electric lines, telegraph and telephone lines and
other similar purposes, or zoning or other restrictions as to the
use of real property or Liens incidental to the conduct of the
business of such Person or to the ownership of its properties
which were not Incurred in connection with Indebtedness and which
do not in the aggregate materially adversely affect the value of
said properties or materially impair their use in the operation
of the business of such Person; (f) Liens existing on the Issue
Date; (g) Liens on property or shares of stock of a Person at the
time such Person becomes a Subsidiary; provided, however, that
any such Lien may not extend to any other property owned by the
Company or any Restricted Subsidiary; provided further, however,
that such Lien was not incurred in anticipation of or in
connection with the transaction or series of transactions
pursuant to which such Person became a Subsidiary of the Company
or any Restricted Subsidiary; (h) Liens on property at the time
the Company or a Subsidiary acquired the property, including any
acquisition by means of a merger or consolidation with or into
the Company or any Restricted Subsidiary; provided, however, that
any such Lien may not extend to any other property owned by the
Company or any Restricted Subsidiary; (i) Liens securing an
Interest Rate Protection Agreement so long as the related
Indebtedness is permitted to be Incurred hereunder, (j) Liens
securing Non-Recourse FF&E Financings or Recourse FF&E
Financings, in each case on the FF&E financed thereby, and Liens
securing the Vicksburg Note, meeting the conditions of the
definition of the Vicksburg Note; (k) Liens to secure any
refinancing, refunding, extension, renewal or replacement (or
successive refinancings, refundings, extensions, renewals or
replacements) as a whole, or in part, of any Indebtedness secured
by any Lien referred to in the foregoing clauses (f), (g), (h)
and (j); provided, however, that (x) such new Lien shall be
limited to all or part of the same property that secured the
original Lien (plus improvements on such property) and (y) the
Indebtedness secured by such Lien at such time is not increased
to any amount greater than the sum of (A) the outstanding
principal amount or, if greater, committed amount of the
Indebtedness described under the foregoing clauses (f), (g), (h)
or (j) at the time the original Lien became a Permitted Lien
hereunder and (B) an amount necessary to pay any fees and
expenses, including premiums, related to such refinancing,
refunding, extension, renewal or replacement; (l) leases or
subleases to third parties that do not materially interfere with
the operation of a Related Business by the Company and its
Restricted Subsidiaries; (m) Liens arising by reason of a
judgment or decree for
<PAGE>the payment of money to the extent not otherwise resulting
in an Event of Default; (n) Liens in favor of the Company or any
Guarantor; (o) Liens securing Senior Indebtedness; and (p) Liens
incurred in the ordinary course of business of the Company or any
Restricted Subsidiary of the Company with respect to obligations
that do not exceed $2 million in the aggregate at any one time
outstanding and that (a) are not incurred in connection with the
borrowing of money or the obtaining of advances or credit (other
than Trade Payables) and (b) do not in the aggregate materially
detract from the value of the property or materially impair the
use thereof in the operation of a Related Business by the Company
or such Restricted Subsidiary.
"Person" means any individual, corporation, partnership,
joint venture, association, Joint-stock company, trust,
unincorporated organization, government or any agency or
political subdivision thereof or any other entity.
"Physical Note" is defined in Section 2.01 and includes the
Subsidiary Guarantees endorsed thereon.
"Preferred Stock," as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however
designated) which is preferred as to the payment of dividends, or
as to the distribution of assets upon any voluntary or
involuntary liquidation or dissolution of such corporation, over
shares of Capital Stock of any other class of such corporation.
"principal" of a Note means the principal of the Note plus
the premium, if any, payable on the Note which is due or overdue
or is to become due at the relevant time.
"Private Placement Legend" is defined in Section 2.15(a).
"pro forma" means, with respect to any calculation made or
required to be made pursuant to the terms hereof, a calculation
in accordance with Article 11 of Regulation S-X promulgated under
the Securities Act (to the extent applicable), or any succeeding
provision, as interpreted in good faith by the Board of Directors
after consultation with the independent certified public
accountants of the Company, or otherwise a calculation made in
good faith by the Board of Directors after consultation with the
independent certified public accountants of the Company, as the
case may be.
"Public Equity Offering" means an underwritten public
offering of common stock of the Company meeting the registration
requirements of the Securities Act (other than a public offering
registered on Form S-8 under the Securities Act or under any
successor form) that results in Net Cash Proceeds of at least $20
million to the Company.
"Purchase Date", when used with respect to any Note to be
purchased pursuant to Sections 4.14, 4.15 or 4.20, means the date
on which such Note is required to be purchased pursuant to such
Section.
"Purchase Price", when used with respect to any Note to be
purchased pursuant to Sections 4.14, 4.15 or 4.20, means the
price fixed for such purchase pursuant to such Section.
<PAGE>"Qualified Institutional Buyer" or "QIB" has the
meaning specified in Rule 144A under the Securities Act.
"Record Date" means a record date set forth in the Notes.
"Recourse FF&E Financing" means Indebtedness of the Company
or any of its Restricted Subsidiaries (other than Non-Recourse
FF&E Financing) that is Incurred to finance the acquisition or
lease after the Issue Date of newly acquired or leased FF&E used
in the operation of any Gaming Establishment owned or leased by
the Company or its Restricted Subsidiaries and secured by a Lien
on such FF&E, provided that such Indebtedness does not exceed the
lesser of cost or Fair Market Value of such FF&E at the time of
the acquisition or lease of such FF&E.
"Redeemable Stock" means, with respect to any Person, any
Capital Stock which by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable) or
upon the happening of any event (i) matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise,
(ii) is convertible or exchangeable for Indebtedness (other than
Preferred Stock) or Disqualified Stock or (iii) is redeemable at
the option of the holder thereof, in whole or in part.
"Redemption Date" when used with respect to any Note to be
redeemed, means the date fixed for such redemption pursuant to
this Indenture and the Notes.
"Redemption Price" when used with respect to any Note to be
redeemed, means the price fixed for such redemption pursuant to
this Indenture and the Notes.
"Refinancing Indebtedness" means Indebtedness that refunds,
refinances, replaces, renews, restates, repays or extends
(including pursuant to any defeasance or discharge mechanism)
(collectively, "refinances," and "refinanced" shall have a
correlative meaning) any Indebtedness existing on the Issue Date
or Incurred in compliance herewith (including, subject to the
proviso below, Indebtedness of the Company that refinances
Indebtedness of any Restricted Subsidiary and Indebtedness of any
Restricted Subsidiary that refinances Indebtedness of another
Restricted Subsidiary) including Indebtedness that refinances
Refinancing Indebtedness; provided, however, that (i) the
Refinancing Indebtedness has a Stated Maturity no earlier than
the Stated Maturity of the Indebtedness being refinanced, (ii)
the Refinancing Indebtedness has an Average Life at the time such
Refinancing Indebtedness is Incurred that is equal to or greater
than the Average Life of the Indebtedness being refinanced, (iii)
such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an
aggregate issue price) that is equal to or less than the
aggregate principal amount (or if issued with original issue
discount, the aggregate accreted value) then outstanding of the
Indebtedness being refinanced, (iv) if the Indebtedness of the
Company or a Restricted Subsidiary being refinanced is
subordinated to other Indebtedness of the Company or a Restricted
Subsidiary in any respect, such Refinancing Indebtedness is
subordinated at least to the same extent (except that up to $22
million, less the aggregate amount of principal payments made on
the Gem Notes, of Indebtedness Incurred to refinance the Gem
Notes may rank pari passu with the Notes, if (a) the terms of
such Indebtedness (except for the interest rate) are
substantially similar to those of the Notes and (b) after giving
pro forma effect to the Incurrence of such Indebtedness, the
Consolidated Coverage
<PAGE>Ratio of the Company is at least 2.25:1 and no Default or
Event of Default shall exist) and (v) if the Indebtedness of the
Company or a Restricted Subsidiary being refinanced is a Non-
Recourse FF&E Financing or the Vicksburg Note, such Refinancing
Indebtedness shall meet the conditions set forth in the
definition of "Non-Recourse FF&E Financing" (other than clause
(i) thereof) or "Vicksburg Note," as applicable; provided
further, however, that Refinancing Indebtedness shall not include
(a) Indebtedness of a Subsidiary that refinances Indebtedness of
the Company, (b) Indebtedness of a Restricted Subsidiary that is
not a Guarantor that refinances Indebtedness of a Guarantor, or
(c) Indebtedness of the Company or a Restricted Subsidiary that
refinances Indebtedness of an Unrestricted Subsidiary.
"Registrar" is defined in Section 2.03.
"Registration Rights Agreement" means that certain
Registration Rights Agreement, dated as of July 15, 1997, by and
among the Company and the other parties named on the signature
pages thereto, as amended from time to time.
"Regulation S Global Notes" is defined in Section 2.01 and
includes the Subsidiary Guarantees endorsed thereon.
"Regulation S Permanent Global Notes" is defined in Section
2.01 and includes the Subsidiary Guarantees endorsed thereon.
"Regulation S Temporary Global Notes" is defined in Section
2.01 and includes the Subsidiary Guarantees endorsed thereon.
"Related Business" means the business conducted (or proposed
to be conducted) as of the Issue Date by the Company and its
Subsidiaries in connection with any Gaming Establishment and any
and all reasonably related businesses necessary for, in support
or anticipation of and ancillary to or in preparation for, such
business including, without limitation, the development,
expansion or operation of any Gaming Establishment (including any
land-based, dockside, riverboat or other type of casino), owned,
or to be owned, leased or managed by the Company or one of its
Restricted Subsidiaries.
"Remaining Guarantor" is defined in Section 11.03(a).
"Representative" means the trustee, agent or representative
(if any) for an issue of Senior Indebtedness.
"Repurchase Offer" is defined in Section 4.24.
"Restricted Investment" means an Investment other than a
Permitted Investment.
"Restricted Global Notes" is defined in Section 2.01 and
includes the Subsidiary Guarantees endorsed thereon.
"Restricted Payment" has the meaning set forth in
Section 4.10.
<PAGE>"Restricted Period" is defined in Section 2.01.
"Restricted Security" has the meaning assigned to such term
in Rule 144(a)(3) under the Securities Act; provided that the
Trustee shall be entitled to request and conclusively rely on an
Opinion of Counsel with respect to whether any Note constitutes a
Restricted Security.
"Restricted Subsidiary" means (i) any Specified Subsidiary
and (ii) any other Subsidiary of the Company that is not an
Unrestricted Subsidiary.
"Revolving Credit Facility" means the $125 million Revolving
Credit Facility pursuant to a Credit Agreement dated as of
July 8, 1997, as amended from time to time, among the Company,
certain of the Company's Subsidiaries, the Lenders named therein
and Wells Fargo Bank N.A., as agent, arranger and swingline
lender, and any related documents or instruments and any
extensions, revisions, refinancings or replacements thereof by a
bank or a syndicate of institutional lenders (including any
increase in the commitments thereunder to the extent otherwise
permissible under this Indenture).
"Sale/Leaseback Transaction" means an arrangement relating
to property now owned or hereafter acquired whereby the Company
or a Restricted Subsidiary transfers such property to a Person
and the Company or a Restricted Subsidiary leases it from such
Person.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as
amended from time to time.
"Senior Indebtedness" means, with respect to the Company or
any Guarantor, (i) the Bank Indebtedness of such Person and (ii)
all other Indebtedness of such Person (other than Disqualified
Stock), including interest thereon, whether outstanding on the
date of the Indenture or thereafter issued, unless in the
instrument creating or evidencing the same or pursuant to which
the same is outstanding it is provided that such obligations are
not superior in right of payment to the Notes or the Subsidiary
Guarantee of such Guarantor, as applicable; provided, however,
that Senior Indebtedness shall not include (a) any obligation of
the Company to any Subsidiary or any Affiliate, (b) any liability
for Federal, state, local or other taxes owed or owing by the
Company or any Guarantor, (c) any Trade Payables or other
liability to trade creditors arising in the ordinary course of
business (including Guarantees thereof or instruments evidencing
such liabilities), (d) any Indebtedness, Guarantee or obligation
of the Company or any Guarantor that is subordinate or junior in
any respect to any other Indebtedness, Guarantee or obligation of
such Person, including any Senior Subordinated Indebtedness and
any Subordinated Obligations, (e) any obligations with respect to
any Capital Stock, (f) any Indebtedness Incurred in violation of
the Indenture, or (g) any Indebtedness Incurred after the Issue
Date in excess of the $250 million limit (or such higher limit as
then in effect under all Gem Notes) on "Senior Indebtedness"
under, and as defined in, the Gem Notes.
"Senior Subordinated Indebtedness" means the Notes and any
other Indebtedness of the Company that specifically provides that
such Indebtedness is to rank pari passu with the Notes
<PAGE>and is not subordinated by its terms to any Indebtedness or
other obligation of the Company that is not Senior Indebtedness.
"Specified Subsidiary" means CPI, ACCBI, ACLVI, ACVI, ACHC
and any other existing or future Subsidiary of the Company that
owns, leases, operates or manages any of the assets of CPI,
ACCBI, ACLVI, ACVI or ACHC on the Issue Date, or any additions,
extensions or replacements of any such assets, or holds any
Gaming License relating to any such assets, additions, extensions
or replacements.
"Stated Maturity" means, with respect to any security or
Indebtedness, the date specified in such security or Indebtedness
as the fixed date on which the payment of principal of such
security or Indebtedness is due and payable, including pursuant
to any mandatory redemption or prepayment provision (but
excluding any provision providing for the repurchase or
prepayment of such security or Indebtedness at the option of the
holder thereof upon the happening of any contingency beyond the
control of the issuer or borrower unless such contingency has
occurred).
"Subordinated Obligation" means any Indebtedness of the
Company (whether outstanding on the date hereof or thereafter
Incurred) which is subordinate or junior in right of payment to
the Notes in any respect and, in any event, includes the Gem
Notes (except for Refinancing Indebtedness relating to the Gem
Notes that satisfies the criteria of the parenthetical provisions
to clause (iv) of the definition of "Refinancing Indebtedness").
"Subsidiary" of any Person means any corporation,
association, limited liability company, partnership or other
business entity of which more than 50% of the total voting power
of shares of Capital Stock or other interests (including limited
liability company or partnership interests) entitled (without
regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the
time owned or controlled, directly or indirectly, by (i) such
Person, (ii) such Person and one or more Subsidiaries of such
Person or (iii) one or more Subsidiaries of such Person.
"Subsidiary Guarantee" is defined in Section 11.01(a).
"Temporary Cash Investments" means any of the following: (i)
investments in U.S. Government Obligations maturing within 90
days of the date of acquisition thereof, (ii) investments in time
deposit accounts, certificates of deposit and money market
deposits maturing within 90 days of the date of acquisition
thereof issued by a bank or trust company organized under the
laws of the United States or any state thereof having capital,
surplus and undivided profits aggregating in excess of
$500,000,000 and (a) whose long-term debt is rated "A-3" or "A-"
or higher according to Moody's Investors Service, Inc. or
Standard and Poor's Ratings Group (or such similar equivalent
rating by at least one "nationally recognized statistical rating
organization" (as defined in Rule 436 under the Securities Act)
or (b) which has a Keefe Bank Watch Rating of "B" or better,
(iii) repurchase obligations with a term of not more than 7 days
for underlying securities of the types described in clause (i)
above entered into with a bank meeting the qualifications
described in clause (ii) above, and (iv) investments in
commercial paper, maturing not more than 90 days after the date
of acquisition, issued by a corporation (other than an Affiliate
of the Company) organized and in existence under the laws of the
United States of
<PAGE>America with a rating at the time as of which any
investment therein is made of "P-1 " (or higher) according to
Moody's Investors Service, Inc. or "A-1" (or higher) according to
Standard and Poor's Corporation.
"TIA" means the Trust Indenture Act of 1939, as amended from
time to time.
"Trade Payables" means, with respect to any Person, any
accounts payable or any indebtedness or monetary obligation to
trade creditors created, assumed or Guaranteed by such Person
arising in the ordinary course of business of such Person in
connection with the acquisition of goods or services.
"Trustee" means the party named in the preamble until a
successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor
serving hereunder.
"U.S. Legal Tender" means such coin or currency of the
United States of America as at the time of payment shall be legal
tender for the payment of public and private debts.
"Unrestricted Subsidiary" means (i) any Subsidiary of the
Company that at the time of determination shall be designated an
Unrestricted Subsidiary by the Board of Directors in the manner
provided under Section 4.19(b), and (ii) any Subsidiary of an
Unrestricted Subsidiary, but, in each case, only to the extent
that such Subsidiary or a Subsidiary of such Subsidiary (a) does
not own any Capital Stock or Indebtedness of, or own or hold any
Lien on any property of, the Company or any other Subsidiary of
the Company that is not a Subsidiary of such Unrestricted
Subsidiary, (b) has no Indebtedness other than Non-Recourse
Indebtedness, (c) is not a party to any agreement, contract,
arrangement or understanding with the Company or any Restricted
Subsidiary of the Company the terms of which are less favorable
to the Company or such Restricted Subsidiary than those that
might be obtained at the time from Persons who are not Affiliates
of the Company, (d) is not a Person with respect to which the
Company or any of its Restricted Subsidiaries has any direct or
indirect obligation (unless the payment or fulfillment of such
obligation is expressly conditioned upon compliance with
Section 4.10) (1) to subscribe for additional Capital Stock, or
(2) to maintain or preserve such Person's financial condition or
to cause such Person to achieve any specified levels of operating
results, and (e) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the
Company or any of its Restricted Subsidiaries. If, at any time,
any Unrestricted Subsidiary would fail to meet the requirements
set forth in the preceding sentence, it shall thereafter cease to
be an Unrestricted Subsidiary for purposes hereof and any
Indebtedness of such Subsidiary shall be deemed to be incurred by
a Restricted Subsidiary of the Company as of such date (and, if
such Indebtedness is not permitted to be incurred as of such date
under Section 4.12, the Company shall be in default of such
Section).
"U. S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such
obligations) of the United States of America (including any
agency or instrumentality thereof) for the payment of which the
full faith and credit of the United States of America is pledged
and which are not callable or redeemable at the issuer's option.
<PAGE>"Vicksburg Hotel" means the hotel being constructed
across the street from the main entrance to the Vicksburg Casino
and the underlying real estate.
"Vicksburg Note" means the promissory note made or to be
made by ACHC in favor of certain lenders (and any related loan or
collateral security agreements) the proceeds of which are used to
fund the construction costs of the Vicksburg Hotel, as described
under "Description of Existing Indebtedness," in the Offering
Memorandum provided that (i) the aggregate outstanding principal
amount thereof, together with any Refinancing Indebtedness with
respect thereto, shall not exceed $7.5 million at any time, (ii)
the Indebtedness evidenced thereby is secured by a Lien on the
Vicksburg Hotel and any other related assets, but no other
collateral, (iii) such note provides that no personal recourse
shall be had against the Company or any Restricted Subsidiary for
the payment of Indebtedness evidenced by such note, enforcement
being limited to the Vicksburg Hotel and such other related
assets, (iv) neither the Company nor any of the Restricted
Subsidiaries (other than ACHC) shall provide any credit support
or be liable with respect to such note, under a Guarantee or
otherwise, or constitute the lender with respect to such note,
and (v) any event that results in any such Indebtedness ceasing
to meet any of the foregoing conditions shall be deemed to
constitute the Incurrence of Indebtedness by the obligor thereof.
The prohibition set forth in clause (iv) above shall not restrict
ACVI and ACHC from entering into a management agreement, an
operating agreement and/or related contractual arrangements,
provided that ACVI does not Incur any liability on the Vicksburg
Note.
"Voting Stock" of a corporation means all classes of Capital
Stock of such corporation then outstanding and normally entitled
to vote in the election of directors.
"Wholly Owned Subsidiary" means a Restricted Subsidiary of
the Company all the Capital Stock of which (other than directors'
qualifying shares) is owned by the Company or another Wholly
Owned Subsidiary.
SECTION 1.02.Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA,
such provision is incorporated by reference in, and made a part
of, this Indenture. The following TIA terms used in this
Indenture have the following meanings:
"indenture securities" means the Notes, including the
Subsidiary Guarantees with respect thereto.
"indenture security holder" means a Holder or a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means any Obligor or
any other obligor on the Notes.
<PAGE>All other TIA terms used in this Indenture that are
defined by the TIA, defined by TIA reference to another statute
or defined by SEC rule and not otherwise defined herein have the
meanings assigned to them therein.
SECTION 1.03.Rules of Construction.
Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP, and unless
otherwise provided herein, all accounting determinations
shall be made in accordance with GAAP consistently applied;
(iii) "or" is not exclusive and "including" is not
limiting;
(iv) words in the singular include the plural, and
words in the plural include the singular;
(v) references in this Indenture to any agreement,
other document or law "as amended" or "as amended from time
to time," or to "amendments" of any document or law, shall
include any amendments, supplements, replacements, renewals
or other modifications from time to time, provided in the
case of modifications to documents, such modifications are
permissible hereunder;
(vi) references in this Indenture to any law include
regulations promulgated thereunder from time to time; and
(vii) The Table of Contents, Cross-Reference Table
and Headings of the Articles and Sections of this Indenture
have been inserted for convenience of reference only, are
not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions
hereof. These and any other references to any subdivision
in this Indenture are to this Indenture, and the words
"herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision.
ARTICLE TWO
THE NOTES
SECTION 2.01.Form and Dating.
The Notes, and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto (including
in the case of Initial Notes the bracketed text referred to in
footnotes 1, 3, 4, 6, 7, 9, 12, 13 and 14). The Notes may have
notations, legends or endorsements required by law, stock
exchange rule or depository rule or usage. The Company
<PAGE>and the Trustee shall approve the form of the Notes and any
notation, legend or endorsement on them. Each Note shall be
dated the date of its authentication.
The terms and provisions contained in the Notes, annexed
hereto as Exhibit A, shall constitute, and are hereby expressly
made, a part of this Indenture and, to the extent applicable, the
Obligors and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be
bound thereby.
Notes offered and sold to QIBs in reliance on Rule 144A
shall be issued initially in the form of one or more global Notes
in registered form, substantially in the form set forth in
Exhibit A (including the bracketed text referred to in footnotes
2, 5, 10, 11 and 15) (the "Restricted Global Note"). Notes
offered and sold in reliance on Regulation S shall be issued
initially in the form of one or more global Notes in registered
form, substantially in the form set forth in Exhibit A (including
the bracketed text referred to in footnotes 2, 5, 10, 11 and 15)
(the "Regulation S Temporary Global Note"). Beneficial interests
in a Regulation S Temporary Global Note will be exchanged for
beneficial interests in a single Note in permanent global form
(the "Regulation S Permanent Global Note", and, together with the
Regulation S Temporary Note, the "Regulation S Global Notes")
after the Restricted Period (as defined below) upon certification
that the beneficial interests in such global securities are owned
by either Non-U.S. Persons or QIBs. Regulation S Global Notes
and Restricted Global Notes are collectively referred to herein
as the "Global Notes." A beneficial interest in a Global Note
may be exchanged for certificated notes ("Physical Notes") in
accordance with the rules of the Depository, Section 2.16 and
Section 2.17.
The Global Notes shall be deposited with the Trustee, as
custodian for the Depository, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The Global
Notes shall be registered in the name of Cede & Co. ("Cede"), as
the Depository's nominee, for credit to an account of a direct or
indirect participant in the Depository. With respect to any
beneficial interest in a Regulation S Global Note acquired from
the Company, a distributor (as such term is defined in
Regulation S under the Securities Act) or any of their respective
affiliates, through and including August 24, 1997 (such period
through and including August 24, 1997, the "Restricted Period"),
beneficial interests in the Regulation S Global Notes may be held
only through the Euroclear System ("Euroclear") and Cedel, S.A.
("CEDEL") (as indirect participants in the Depository), unless
transferred to a person that takes delivery through the
Restricted Global Notes in accordance with the requirements of
Section 2.17.
The aggregate principal amount of a Global Note may from
time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depository, and by
corresponding adjustment to Schedule A of such Notes, as
hereinafter provided.
SECTION 2.02.Execution and Authentication; Aggregate
Principal Amount.
Two Officers, or an Officer and an Assistant Secretary,
shall sign, or one Officer shall sign and one Officer or an
Assistant Secretary (each of whom shall, in each case, have been
duly authorized by all requisite corporate actions) shall attest
to, the Notes for the Obligors by manual or facsimile signature.
The Company's seal shall also be reproduced on the Notes.
<PAGE>If an Officer or Assistant Secretary whose signature
is on a Note was an Officer or Assistant Secretary at the time of
such execution but no longer holds that office or position at the
time the Trustee authenticates the Note, the Note shall
nevertheless be valid.
A Note shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on
the Note. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
The Trustee shall authenticate (i) Initial Notes for
original issue in the aggregate principal amount not to exceed
$100,000,000, and (ii) Exchange Notes from time to time for issue
only in exchange for a like principal amount of Initial Notes, in
each case upon written orders of the Obligors in the form of an
Officers' Certificate. The Officers' Certificate shall specify
the amount of Notes to be authenticated, the date on which the
Notes are to be authenticated and the aggregate principal amount
of Notes outstanding on the date of authentication, whether the
Notes are to be Initial Notes or Exchange Notes. The aggregate
principal amount of Notes outstanding at any time may not exceed
$100,000,000, except as provided in Section 2.07.
The Trustee may appoint an authenticating agent (the
"Authenticating Agent") reasonably acceptable to the Company to
authenticate Notes. Unless otherwise provided in the
appointment, an Authenticating Agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture
to authentication by the Trustee includes authentication by such
Authenticating Agent. An Authenticating Agent has the same
rights as an Agent to deal with the Company and Affiliates of the
Company.
The Notes shall be issuable in fully registered form only,
without coupons, in denominations of $1,000 and any integral
multiple thereof.
SECTION 2.03.Registrar and Paying Agent.
The Company shall maintain an office or agency (which shall
be located in the Borough of Manhattan in The City of New York,
State of New York) where (a) Notes may be presented or
surrendered for registration of transfer or for exchange (the
"Registrar"), (b) Notes may be presented or surrendered for
payment (the "Paying Agent") and (c) notices and demands to or
upon the Company in respect of the Notes and this Indenture may
be served. The Registrar shall keep a register of the Notes and
of their transfer and exchange. The Company, upon prior written
notice to the Trustee, may have one or more co-Registrars and one
or more additional paying agents reasonably acceptable to the
Trustee. The term "Paying Agent" includes any additional Paying
Agent.
The Company shall enter into an appropriate agency agreement
with any Agent not a party to this Indenture, which agreement
shall incorporate the provisions of the TIA and implement the
provisions of this Indenture that relate to such Agent. The
Company shall notify the Trustee, in advance, of the name and
address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, or fails to give the foregoing notice,
the Trustee shall act as such.
<PAGE>The Company initially appoints the Trustee as
Registrar, Paying Agent and agent for service of demands and
notices in connection with the Notes, until such time as the
Trustee has resigned or a successor has been appointed.
The Company initially appoints The Depository Trust Company
("DTC") to act as Depository with respect to the Global Notes.
SECTION 2.04.Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that each Paying Agent shall hold in
trust for the benefit of the Holders or the Trustee all assets
held by the Paying Agent for the payment of principal of, or
premium or interest on, the Notes (whether such assets have been
distributed to it by the Company or any other obligor on the
Notes), and the Company and the Paying Agent shall notify the
Trustee of any Default by the Company (or any other obligor on
the Notes) in making any such payment. The Company at any time
may require a Paying Agent to distribute all assets held by it to
the Trustee and account for any assets disbursed and the Trustee
may at any time during the continuance of any payment Default,
upon written request to a Paying Agent, require such Paying Agent
to distribute all assets held by it to the Trustee and to account
for any assets distributed. Upon distribution to the Trustee of
all assets that shall have been delivered by the Company to the
Paying Agent, the Paying Agent shall have no further liability
for such assets. If the Company or a Subsidiary acts as Paying
Agent, it shall segregate and hold in a separate trust fund for
the benefit of the Holders all money held by it as Paying Agent.
Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.
SECTION 2.05.Noteholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of
the names and addresses of the Holders. If the Trustee is not
the Registrar, the Company shall furnish or cause the Registrar
to furnish to the Trustee promptly following each Record Date and
at such other times as the Trustee may request in writing a list
as of such date and in such form as the Trustee may reasonably
require of the names and addresses of the Holders, which list may
be conclusively relied upon by the Trustee.
SECTION 2.06.Transfer and Exchange.
Subject to Sections 2.16 and 2.17, when Notes are presented
to the Registrar or a co-Registrar with a request to register the
transfer of such Notes or to exchange such Notes for an equal
principal amount of Notes of other authorized denominations, the
Registrar or co-Registrar shall register the transfer or make the
exchange as requested if its requirements for such transaction
are met; provided, however, that the Notes presented or
surrendered for registration of transfer or exchange shall be
duly endorsed or accompanied by a written instrument of transfer
in form satisfactory to the Obligors and the Registrar or co-
Registrar, duly executed by the Holder thereof or its attorney
duly authorized in writing. To permit registrations of transfer
and exchanges, the Obligors shall execute and the Trustee shall
authenticate Notes at the Registrar's or co-Registrar's request.
No service charge shall be made for any registration of transfer
or
<PAGE>exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such
transfer taxes or similar governmental charge payable upon
exchanges or transfers pursuant to Sections 2.10, 3.06, 4.14,
4.15, 4.20 or 9.06, in which event the Company shall be
responsible for the payment of such taxes).
The Registrar or co-Registrar shall not be required to
register the transfer of or exchange of any Note (i) during a
period beginning at the opening of business 15 days before the
mailing of a notice of redemption of Notes and ending at the
close of business on the day of such mailing, (ii) selected for
redemption in whole or in part pursuant to Article Three, except
the unredeemed portion of any Note being redeemed in part, and
(iii) during a period beginning at the opening of business 15
days before an Interest Payment Date and ending at the close of
business on such Interest Payment Date.
Any Holder of a Global Note shall, by acceptance of such
Global Note, agree that transfers of beneficial interests in such
Global Notes may be effected only through a book entry system
maintained by the Holder of such Global Note (or its agent), and
that ownership of a beneficial interest in the Note shall be
required to be reflected in a book entry.
SECTION 2.07.Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the
Holder of a Note claims that the Note has been lost, destroyed or
wrongfully taken, the Obligors shall issue and the Trustee shall
authenticate a replacement Note if the Trustee's requirements are
met. If required by the Trustee or the Obligors, such Holder
must provide an affidavit of lost certificate and an indemnity
bond or other indemnity, sufficient in the judgment of both the
Obligors and the Trustee, to protect the Obligors, the Trustee or
any Agent from any loss which any of them may suffer if a Note is
replaced. The Obligor may charge such Holder for its reasonable,
out-of-pocket expenses in replacing a Note, including reasonable
fees and expenses of counsel. Every replacement Note shall
constitute an additional obligation of the Obligors.
SECTION 2.08.Outstanding Notes.
Notes outstanding at any time are all the Notes that have
been authenticated by the Trustee except those canceled by it,
those delivered to it for cancellation and those described in
this Section 2.08 as not outstanding. Subject to Section 2.09, a
Note does not cease to be outstanding because the Company or any
of its respective Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.07 (other than a
mutilated Note surrendered for replacement), it ceases to be
outstanding unless the Trustee receives an Opinion of Counsel
that the replaced Note is held by a bona fide purchaser. A
mutilated Note ceases to be outstanding upon surrender of such
Note and replacement thereof pursuant to Section 2.07.
If on a Redemption Date, any Purchase Date or the Maturity
Date, the Paying Agent holds U.S. Legal Tender sufficient to pay
all of the principal and interest and Liquidated Damages, if any,
due on the Notes payable on that date and is not prohibited from
paying such money to the
<PAGE>Holders thereof pursuant to the terms of this Indenture,
then on and after that date such Notes cease to be outstanding
and interest and Liquidated Damages, if any, on them ceases to
accrue.
SECTION 2.09.Treasury Notes.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver, consent
or notice, Notes owned by any Obligor, or any of its Affiliates
shall be considered as though they are not outstanding, except
that for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent,
only Notes that a Trust Officer of the Trustee actually knows are
so owned shall be so considered. The Company shall notify the
Trustee, in writing, when it or any of its Affiliates repurchases
or otherwise acquires Notes, of the aggregate principal amount of
such Notes so repurchased or otherwise acquired.
SECTION 2.10.Temporary Notes.
Until definitive Notes are ready for delivery, the Obligors
may prepare and the Trustee shall authenticate temporary Notes
upon receipt of a written order of the Obligors in the form of
one or more Officers' Certificates. Each Officers' Certificate
shall specify the amount of temporary Notes to be authenticated
and the date on which the temporary Notes are to be
authenticated. Temporary Notes shall be substantially in the
form of definitive Notes but may have variations that the Company
considers appropriate for temporary Notes. Without unreasonable
delay, the Obligors shall prepare and the Trustee shall
authenticate upon receipt of a written order of the Obligors
pursuant to Section 2.02 definitive Notes in exchange for
temporary Notes.
SECTION 2.11.Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward
to the Trustee any Notes surrendered to them for registration of
transfer, exchange or payment. The Trustee, or at the direction
of the Trustee, the Registrar or the Paying Agent, and no one
else, shall cancel and shall dispose of all Notes surrendered for
registration of transfer, exchange, payment or cancellation.
Subject to Section 2.07, the Company may not issue new Notes to
replace Notes that it has paid or delivered to the Trustee for
cancellation. If the Company shall acquire any of the Notes,
such acquisition shall not operate as a redemption or
satisfaction of the Indebtedness represented by such Notes unless
and until the same are surrendered to the Trustee for
cancellation pursuant to this Section 2.11.
The Trustee shall destroy all canceled Notes in accordance
with its usual procedures unless the Company by written
directions shall otherwise direct.
SECTION 2.12.Defaulted Interest.
If the Company defaults in a payment of interest on the
Notes, it shall pay the defaulted interest, plus (to the extent
lawful) any interest payable on the defaulted interest to the
Persons who are Holders on a subsequent special record date,
which date shall be the fifteenth day next preceding the date
fixed by the Company for the payment of defaulted interest or the
next
<PAGE>succeeding Business Day if such date is not a Business Day.
At least 15 days before the subsequent special record date, the
Company shall mail to each Holder, as of a recent date selected
by the Company, with a copy to the Trustee, a notice that states
the subsequent special record date, the payment date and the
amount of defaulted interest, and interest payable on such
defaulted interest, if any, to be paid.
SECTION 2.13.CUSIP Number.
The Company in issuing the Notes may use one or more "CUSIP"
numbers, and if so, the Trustee shall use the appropriate CUSIP
number in notices of redemption or exchange as a convenience to
Holders; provided that no representation is hereby deemed to be
made by the Trustee as to the correctness or accuracy of any
CUSIP number printed in the notice or on the Notes, and that
reliance may be placed only on the other identification numbers
printed on the Notes. The Company shall promptly notify the
Trustee of any change in any CUSIP number.
SECTION 2.14.Deposit of Money.
Subject to Section 4.01(b), prior to 11:00 a.m. New York
City time on each Interest Payment Date and Maturity Date, the
Company shall deposit with the Paying Agent in immediately
available funds money sufficient to make cash payments, if any,
due on such Interest Payment Date or Maturity Date, as the case
may be, in a timely manner which permits the Paying Agent to
remit payment to the Holders on such Interest Payment Date or
Maturity Date, as the case may be.
SECTION 2.15.Restrictive Legends.
(a) Each Global Note that constitutes a Restricted Security
shall bear the following legend (the "Private Placement Legend")
on the face thereof until July 15, 1999, unless otherwise agreed
by the Company and the Holder thereof:
"THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE NOTE EVIDENCED HEREBY MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE
OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE NOTE EVIDENCED HEREBY
IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A OR REGULATION S
THEREUNDER. THE HOLDER OF THE NOTE EVIDENCED HEREBY
AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH NOTE
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
(1)(a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE
144A UNDER THE
<PAGE>SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT,
(c) OUTSIDE THE UNITED STATES TO A PERSON THAT IS NOT A
U.S. PERSON (AS DEFINED IN RULE 902 UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, OR
(d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (IN THE
CASE OF (b), (c), OR (d), UPON DELIVERY OF AN OPINION
OF COUNSEL IF THE ISSUER OR TRUSTEE, REGISTRAR OR
TRANSFER AGENT FOR THE NOTES SO REQUESTS), (2) TO THE
ISSUER, (3) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THE NOTE EVIDENCED
HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A)
ABOVE."
(b) Each Global Note shall also bear the following legend
on the face thereof:
"UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY
NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY
TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH NOMINEE
OF THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF
SUCH SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF
CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL
<PAGE>BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 2.17 OF THE
INDENTURE."
SECTION 2.16.Book-Entry Provisions for Global
Security.
(a) The Global Notes initially shall (i) be registered in
the name of the Depository or the nominee of such Depository, for
credit to an account of a direct or indirect participant in the
Depository, including Euroclear or CEDEL, and (ii) be delivered
to the Trustee as custodian for such Depository and (iii) bear
legends as set forth in Section 2.15.
Members of, or participants in, the Depository, including
CEDEL and Euroclear ("Agent Members"), shall have no rights under
this Indenture with respect to any Global Note held on their
behalf by the Depository, or the Trustee as its custodian, or
under any Global Note, and the Depository may be treated by the
Obligors, the Trustee and any agent of the Obligors or the
Trustee as the absolute owner of each Global Note for all
purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Obligors, the Trustee or any agent of
the Obligors or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the
Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Note.
(b) Transfers of a Global Note shall be limited to
transfers in whole, but not in part, to the Depository, its
successors or their respective nominees. Interests of beneficial
owners in the Global Notes may be transferred or exchanged for
Physical Notes in accordance with the rules and procedures of the
Depository.
In addition, if (i) the Company notifies the Trustee in
writing that the Depository is no longer willing or able to act
as a Depository with respect to any Global Note and the Company
is unable to locate a qualified successor within 90 days, (ii)
the Company, at its option, notifies the Trustee in writing that
it elects to cause the issuance of Notes in the form of Physical
Notes under this Indenture, or (iii) if a Default or Event of
Default occurs and any owner of a beneficial interest in a Global
Note so requests, then, upon surrender by the Depository or its
nominee of a Global Note, Physical Notes will be issued to each
person that the Depository or its nominee identifies as being the
beneficial owner of the related Notes.
(c) In connection with any transfer or exchange of a
portion of the beneficial interest in a Global Note to beneficial
owners pursuant to Section 2.16(b), the Registrar shall (if one
or more Physical Notes are to be issued) reflect on its books and
records the date and a decrease in the principal amount of the
applicable Global Note in an amount equal to the principal amount
of the beneficial interest in the applicable Global Note to be
transferred, and the Company shall execute, and the Trustee shall
authenticate and deliver, one or more Physical Notes of like
tenor and amount.
(d) In connection with the transfer of an entire Global
Note to beneficial owners pursuant to Section 2.16(b), such
Global Note shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee
shall authenticate and deliver, to
<PAGE>each beneficial owner identified by the Depository in
exchange for its beneficial interest in such Global Note, an
equal aggregate principal amount of Physical Notes of authorized
denominations.
(e) Any Physical Note constituting a Restricted Security
delivered in exchange for an interest in a Global Note pursuant
to paragraph (b) or (c) shall, except as otherwise provided by
Section 2.17(a)(i)(x) and Section 2.17(c), bear the legend
regarding transfer restrictions applicable to the Physical Notes
set forth in Section 2.15.
(f) The Holder of any Global Note may grant proxies and
otherwise authorize any Person, including Agent Members and
Persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under this
Indenture or the Notes.
(g) Whenever, as a result of optional redemption by the
Company pursuant to Section 3.07, an offer to purchase as a
result of a Change of Control pursuant to Section 4.14, an Excess
Proceeds Offer pursuant to Section 4.15, a License Loss Offer
pursuant to Section 4.20, an Exchange Offer (as defined in the
Registration Rights Agreement) or an exchange for Physical Notes,
a Global Note is redeemed, repurchased or exchanged in part, such
Global Note shall be surrendered by the Holder hereof to the
Trustee who shall cause an adjustment to be made to Schedule A of
such Global Note so that the principal amount of such Global Note
will be equal to the portion not redeemed, repurchased or
exchanged and shall thereafter return such Global Note to such
Holder, provided that such Global Note shall be in a principal
amount of $1,000 or an integral multiple of $1,000.
SECTION 2.17.Special Transfer Provisions.
(a) Transfers to Non-U.S. Persons. With respect to any
proposed transfer of a Physical Note constituting a Restricted
Security or any proposed transfer of a beneficial interest in the
Restricted Global Note to any Non-U.S. Person (which Non-U.S.
Person would, in the case of a transfer of a beneficial interest
in the Restricted Global Note, take an interest in the Regulation
S Global Note):
(i) the Registrar shall register the transfer of
such Physical Note constituting a Restricted Security,
whether or not such Note bears the Private Placement
Legend, (x) if the requested transfer is after July 15,
1999, or (y) the proposed transferor has delivered to
the Registrar a certificate substantially in the form
of Exhibit B hereto; and
(ii) in the case of any transfer of any beneficial
interest in the Restricted Global Note, there shall be
delivered to the Registrar (x) the certificate, if any,
required by paragraph (i) above and (y) instructions in
accordance with the Depository's and the Registrar's
procedures.
With respect to all such transfers, (A) the Registrar shall
reflect on its books and records the date of such transfer, (B)
Schedule A to the applicable Global Note or Notes shall be
updated if and as appropriate to reflect such transfer, and (C)
if the transfer is of a Physical Note, the transferred Physical
Note shall be cancelled and, if the entire amount of such
Physical Note was not
<PAGE>transferred, a new Physical Note, in the amount of the
untransferred portion of the original Physical Note, shall be
executed by the Company, authenticated by the Trustee, and
delivered to such transferor.
(b) Transfers to QIBs. With respect to any proposed
transfer of a Physical Note constituting a Restricted Security or
any proposed transfer of a beneficial interest in the Regulation
S Global Note to a QIB (excluding transfers to Non-U.S. Persons)
(which QIB would, in the case of a transfer of a beneficial
interest in the Regulation S Global Notes, take an interest in
the Restricted Global Note):
(i) in the case of a transfer of a Physical Note,
the Registrar shall register the transfer only if the
transferor has delivered to the Registrar a certificate
substantially in the form of Exhibit C hereto; and
(ii) in the case of a transfer of any beneficial
interest in the Regulation S Global Note, there shall
be delivered to the Registrar (x) the certificate, if
any, required by paragraph (i) above and
(y) instructions in accordance with the Depository's
and the Registrar's procedures.
With respect to all such transfers, (A) the Registrar shall
reflect on its books and records the date of such transfer, (B)
Schedule A to the applicable Global Note or Notes shall be
updated if and as appropriate to reflect such transfer, and (C)
if the transfer is of a Physical Note, the transferred Physical
Note shall be cancelled and, if the entire amount of such
Physical Note was not transferred, a new Physical Note, in the
amount of the untransferred portion of the original Physical
Note, shall be executed by the Company, authenticated by the
Trustee, and delivered to such transferor.
(c) Private Placement Legend. Upon the registration of
transfer, exchange or replacement of Notes not bearing the
Private Placement Legend, the Registrar shall deliver Notes that
do not bear the Private Placement Legend. Upon the registration
of transfer, exchange or replacement of Notes bearing the Private
Placement Legend, the Registrar shall deliver only Notes that
bear the Private Placement Legend unless (i) the circumstances
contemplated by Section 2.17(a)(i)(x) exist or (ii) there is
delivered to the Registrar an Opinion of Counsel reasonably
satisfactory to the Company and the Trustee to the effect that
neither such legend nor the related restrictions on transfer are
required in order to maintain compliance with the provisions of
the Securities Act.
(d) General. By its acceptance of any Note bearing the
Private Placement Legend, each Holder of such a Note acknowledges
the restrictions on transfer of such Note set forth in this
Indenture and in the Private Placement Legend and agrees that it
will transfer such Note only as provided in this Indenture.
The Registrar shall retain copies of all letters, notices
and other written communications received pursuant to Section
2.16 or this Section 2.17 in accordance with its usual
procedures. The Company shall have the right to inspect and make
copies of all such letters, notices or other
<PAGE>written communications at any reasonable time upon the
giving of reasonable written notice to the Registrar.
ARTICLE THREE
REDEMPTION
SECTION 3.01.Notices to Trustee.
If the Company elects to redeem Notes pursuant to Section
3.07 or 3.08, it shall notify the Trustee and the Paying Agent in
writing of the Redemption Date and the principal amount of the
Notes to be redeemed. The Company shall give each notice
provided for in this Section 3.01 at least 60 days before the
Redemption Date (unless a shorter notice period shall be
satisfactory to the Trustee, as evidenced in a writing signed on
behalf of the Trustee), together with an Officers' Certificate
stating that such redemption shall comply with the conditions
contained herein and in the Notes.
SECTION 3.02.Selection of Notes To Be Redeemed.
If fewer than all the Notes are to be redeemed pursuant to
Section 3.07, selection of Notes for redemption will be made by
the Trustee, pro rata or by lot or by any other means the Trustee
determines to be fair and appropriate and which complies with
applicable legal and securities exchange requirements.
SECTION 3.03.Notice of Redemption.
At least 30 days but not more than 60 days before a
Redemption Date, the Company shall mail or cause to be mailed a
notice of redemption by first class mail, postage prepaid, to
each Holder whose Notes are to be redeemed, with a copy to the
Trustee and any Paying Agent. At the Company's written request,
the Trustee shall give the notice of redemption in the Company's
name and at the Company's expense.
Each notice for redemption shall identify the Notes to be
redeemed and shall state:
(i) the Redemption Date;
(ii) the Redemption Price and the amount of accrued
interest and Liquidated Damages, if any, to be paid;
(iii) the name and address of the Paying Agent;
(iv) the Section of this Article Three pursuant to
which such redemption is being made;
(v) that Notes called for redemption must be
surrendered to the Paying Agent to collect the Redemption
Price plus accrued interest and Liquidated Damages, if any;
<PAGE>(vi) that, unless the Company defaults in
making the redemption payment, interest on Notes called for
redemption and Liquidated Damages, if any, will cease to
accrue on and after the Redemption Date, and the only
remaining right of the Holders of such Notes is to receive
payment of the Redemption Price plus accrued interest and
Liquidated Damages, if any, upon surrender to the Paying
Agent of the Notes redeemed;
(vii) if any Note is being redeemed in part, the
portion of the principal amount of such Note to be redeemed
and that, after the Redemption Date, and upon surrender of
such Note, a new Note or Notes in the aggregate principal
amount equal to the unredeemed portion thereof will be
issued; and
(viii) if fewer than all the Notes are to be
redeemed, the identification of the particular Notes (or
portion thereof) to be redeemed, as well as the aggregate
principal amount of Notes to be redeemed and the aggregate
principal amount of Notes to be outstanding after such
partial redemption.
SECTION 3.04.Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with
Section 3.03, Notes called for redemption become due and payable
on the Redemption Date and at the Redemption Price plus accrued
interest and Liquidated Damages, if any. Upon surrender to the
Trustee or Paying Agent, such Notes called for redemption shall
be paid at the Redemption Price (which shall include accrued
interest thereon and Liquidated Damages, if any, to the
Redemption Date), but installments of interest or Liquidated
Damages, if any, the maturity of which is on or prior to the
Redemption Date, shall be payable to Holders of record at the
close of business on the relevant record dates referred to in the
Notes.
SECTION 3.05.Deposit of Redemption Price.
Subject to Section 4.01(b), prior to 11:00 A.M., New York
City time, on the Redemption Date, the Company shall deposit with
the Paying Agent U.S. Legal Tender sufficient to pay the
Redemption Price plus accrued interest and Liquidated Damages, if
any, of all Notes to be redeemed on that date. The Paying Agent
shall promptly return to the Company any U.S. Legal Tender so
deposited which is not required for that purpose, except with
respect to amounts owed as obligations to the Trustee pursuant to
Article Seven.
If the Company complies with the preceding paragraph, then,
unless the Company defaults in the payment of such Redemption
Price plus accrued interest and Liquidated Damages, if any,
interest and Liquidated Damages, if any, on the Notes to be
redeemed will cease to accrue on and after the applicable
Redemption Date, whether or not such Notes are presented for
payment.
SECTION 3.06.Notes Redeemed in Part.
Upon surrender of a Note that is to be redeemed in part, the
Trustee shall authenticate for the Holder a new Note or Notes
equal in principal amount to the unredeemed portion of the Note
surrendered.
<PAGE>SECTION 3.07. Redemption.
(a) Except as set forth in Section 3.07(b), the Notes will
not be redeemable at the option of the Company prior to August 1,
2001. On or after that date, the Notes will be redeemable at the
option of the Company, in whole at any time or in part from time
to time, at the Redemption Prices (expressed in percentages of
principal amount) specified below plus accrued and unpaid
interest and Liquidated Damages, if any, to the Redemption Date,
if redeemed during the 12-month period beginning August 1 of the
years indicated below:
Year Percentage
2001 105.25%
2002 103.50%
2003 and thereafter 101.75%
(b) Notwithstanding the foregoing, but subject to the terms
of any Designated Senior Indebtedness, on or prior to August 1,
2000, the Company may redeem up to 25% in aggregate principal
amount of the Notes originally issued hereunder at a Redemption
Price of 110.50% of the principal amount thereof plus accrued and
unpaid interest and Liquidated Damages, if any, thereon to the
Redemption Date with the net proceeds of one or more Public
Equity Offerings; provided that at least $75.0 million in
aggregate principal amount of Notes remain outstanding
immediately after the occurrence of each such redemption; and
provided, further, that notice of each such redemption shall have
been given pursuant to Section 3.03 within 30 days after the date
of the closing of each such Public Equity Offering.
(c) If an Event of Default occurs prior to August 1, 2001,
by reason of any willful action (or inaction) taken (or not
taken) by or on behalf of the Company with the intention of
avoiding the prohibition on redemption of the Notes prior to
August 1, 2001, then the premium (expressed in percentages of
principal amount) specified below shall also become immediately
due and payable to the extent permitted by law upon the
acceleration of the Notes during the 12-month period beginning
August 1 of the years indicated below:
Year Percentage
1997 (and including the
period from 10.50%
July 15, 1997 to
July 31, 1997)
1998 9.188%
1999 7.875%
2000 6.563%
SECTION 3.08.Mandatory Disposition or Redemption
Pursuant to Gaming Laws.
If a Holder or beneficial owner of a Note is required to be
licensed, qualified or found suitable under applicable Gaming
Laws and is not so licensed, qualified or found suitable, or if a
Holder or a beneficial owner of a Note fails to take the steps
necessary to seek such license, qualification or finding of
suitability, the Holder or beneficial owner of a Note shall be
obliged, at
<PAGE>the request of the Company, to dispose of such Holder's or
beneficial owner's Notes within 30 days after receipt of notice
of failure to be licensed, qualified or found suitable or such
earlier date prescribed by any Gaming Authority (in which event
the Company's obligation to pay any interest and Liquidated
Damages, if any, after the receipt of such notice shall be
limited as provided in such Gaming Laws), and thereafter, the
Company shall have the right to redeem, on the date fixed by the
Company for the redemption of such Notes, such Holder's or
beneficial owner's Notes at a Redemption Price equal to the
lowest of (i) the price at which such Holder or beneficial owner
acquired such Notes without accrued interest or Liquidated
Damages, if any, unless the payment of such interest or
Liquidated Damages, if any, is permitted by the applicable Gaming
Authority, in which case such interest and Liquidated Damages, if
any, shall be paid through the Redemption Date, (ii) the fair
market value of such Notes on such Redemption Date and (iii) the
principal amount of such Notes without accrued interest or
Liquidated Damages, if any, thereon, unless the payment of such
interest or Liquidated Damages, if any, is permitted by the
applicable Gaming Authority, in which case such interest and
Liquidated Damages, if any, shall be paid through the Redemption
Date. The Company is not required to pay or reimburse any Holder
or beneficial owner of a Note for the costs of licensure or
investigation for such licensure, qualification, or finding of
suitability. Any Holder or beneficial owner of a Note required to
be licensed, qualified or found suitable under applicable Gaming
Laws must pay all investigative fees and costs of the Gaming
Authorities in connection with such licensure, qualification,
suitability or application therefor.
ARTICLE FOUR
COVENANTS
SECTION 4.01.Payment of Notes.
(a) The Company shall pay the principal of and interest and
Liquidated Damages, if any, on the Notes on the dates and in the
manner provided in the Notes, this Indenture and the Registration
Rights Agreement. Subject to Section 4.01(b), an installment of
principal of or interest on the Notes shall be considered paid on
the date it is due if the Trustee or Paying Agent (other than the
Company or an Affiliate of the Company) holds, prior to 11:00
A.M. New York City time, on that date U.S. Legal Tender
designated for and sufficient to pay the installment in full and
is not prohibited from paying such money to the Holders pursuant
to the terms of this Indenture.
(b) Principal and interest and Liquidated Damages, if any,
will initially be payable at the offices of the Paying Agent but,
at the option of the Company, interest and Liquidated Damages, if
any, may be paid by check mailed to the persons who are
registered Noteholders at their registered addresses provided
that (i) all payments with respect to Global Notes are required
to be made in same day funds in accordance with the policies of
the Depository and (ii) all payments with respect to Notes, the
Holders or beneficial owners of which have given wire transfer
instructions to the Company, will be required to be made by wire
transfer of immediately available funds to the accounts specified
by such Persons, in each case on the due date therefor.
<PAGE>(c) The Company shall pay, to the extent such payments
are lawful, interest on overdue principal and on overdue
installments of interest and Liquidated Damages, if any, (without
regard to any applicable grace periods) from time to time on
demand at the rate borne by the Notes plus 2% per annum.
(d) Interest will be computed on the basis of a 360-day
year comprised of twelve 30-day months.
(e) Notwithstanding anything herein to the contrary
contained in this Indenture, each of the Obligors may, to the
extent it is required to do so by law, deduct or withhold income
or other similar taxes imposed by the United States of America
from principal or interest payments hereunder.
SECTION 4.02.Maintenance of Office or Agency.
The Company shall maintain the office or agency required
under Section 2.03. The Company shall give prior written notice
to the Trustee of the location, and any change in the location,
of such office or agency. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 12.02.
SECTION 4.03.Corporate Existence.
Except as otherwise permitted by Article Five and Section
4.15, the Company shall do or cause to be done, at its own cost
and expense, all things necessary to preserve and keep in full
force and effect its corporate existence and the corporate
existence of each of its Restricted Subsidiaries in accordance
with the respective organizational documents of each such
Restricted Subsidiary and the material rights (charter and
statutory) and franchises of the Company and each such Restricted
Subsidiary; provided, however, that the Company shall not be
required to preserve, with respect to itself, any material right
or franchise and, with respect to any of its Restricted
Subsidiaries, any such existence, material right or franchise, if
the Board of Directors of the Company shall determine in good
faith that the preservation thereof is no longer desirable in the
conduct of the business of the Company and the Restricted
Subsidiaries, taken as a whole.
SECTION 4.04.Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all
material taxes, assessments and governmental charges (including
withholding taxes and any penalties, interest and additions to
taxes) levied or imposed upon it or any of its Subsidiaries or
properties of it or any of its Subsidiaries and (ii) all lawful
claims for labor, materials and supplies that, if unpaid, might
by law become a Lien upon the property of it or any of its
Subsidiaries; provided, however, that the Company shall not be
required to pay or discharge or cause to be paid or discharged
any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by
appropriate proceedings
<PAGE>properly instituted and diligently conducted for which
adequate reserves, to the extent required under GAAP, have been
taken.
SECTION 4.05.Maintenance of Properties and Insurance.
(a) The Company shall, and shall cause each of its
Restricted Subsidiaries to, maintain its material properties in
good working order and condition (subject to ordinary wear and
tear) and make all necessary repairs, renewals, replacements,
additions, betterments and improvements thereto and actively
conduct and carry on its business; provided, however, that
nothing in this Section 4.05 shall prevent the Company or any of
its Restricted Subsidiaries from discontinuing the operation and
maintenance of any of its properties, if such discontinuance is,
in the good faith judgment of the Board of Directors of the
Company or the Restricted Subsidiary, as the case may be,
desirable in the conduct of their respective businesses and is
not disadvantageous in any material respect to the Holders.
(b) The Company shall provide or cause to be provided, for
itself and each of its Restricted Subsidiaries, insurance
(including appropriate self-insurance) against loss or damage of
the kinds that, in the good faith judgment of the Board of
Directors of the Company, are adequate and appropriate for the
conduct of the business of the Company and such Restricted
Subsidiaries in a prudent manner, with reputable insurers or with
the government of the United States of America or an agency or
instrumentality thereof, in such amounts, with such deductibles,
and by such methods as shall be, in the good faith judgment of
the Board of Directors of the Company, adequate and appropriate
for the conduct of the business of the Company and such
Restricted Subsidiaries.
SECTION 4.06.Compliance Certificate; Notice of
Default.
(a) The Company shall deliver to the Trustee, within 90
days after the end of the Company's fiscal year, an Officers'
Certificate signed by the chief executive officer or the chief
operating officer and the chief financial officer or the chief
accounting officer of the Company stating that a review of its
activities and the activities of its Subsidiaries during the
preceding fiscal year has been made under the supervision of the
signing Officers with a view to determining whether each of the
Company and its Subsidiaries has kept, observed, performed and
fulfilled its obligations under this Indenture and further
stating, as to each such Officer signing such certificate, that
to the best of such Officer's knowledge each of the Company and
its Subsidiaries during such preceding fiscal year has kept,
observed, performed and fulfilled each and every such covenant
and no Default or Event of Default occurred during such year and
at the date of such certificate there is no Default or Event of
Default that has occurred and is continuing or, if such signers
do know of such Default or Event of Default, the certificate
shall describe the Default or Event of Default and its status
with particularity and shall also describe what action the
Company is taking or proposes to take with respect thereto.
The Officers' Certificate shall also notify the Trustee
should the Company elect to change the manner in which it fixes
its fiscal year end.
<PAGE>(b) The annual financial statements delivered pursuant
to Section 4.08 shall be accompanied by a written report of the
Company's independent accountants (who shall be a firm of
established national reputation) that in conducting their audit
of such financial statements nothing has come to their attention
that would lead them to believe that the Company has violated any
of Article Four, Five or Six of this Indenture insofar as they
relate to accounting matters or, if any such violation has
occurred, specifying the nature and period of existence thereof,
it being understood that such accountants shall not be liable
directly or indirectly to any Person for any failure to obtain
knowledge of any such violation.
(c) (i) If any Default or Event of Default has occurred and
is continuing or (ii) if any Holder seeks to exercise any remedy
hereunder with respect to a claimed Default under this Indenture
or the Notes, the Company shall deliver to the Trustee, at its
address set forth in Section 12.02, by registered or certified
mail or by telegram, telex or facsimile transmission followed by
hard copy by registered or certified mail an Officers'
Certificate specifying such event, notice or other action within
five Business Days of its becoming aware of such occurrence.
SECTION 4.07.Compliance with Laws.
The Company shall comply, and shall cause each of its
Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of
America, all states and municipalities thereof, and of any
governmental department, commission, board, regulatory authority,
bureau, agency and instrumentality of the foregoing, in respect
of the conduct of their respective businesses and the ownership
of their respective properties, except for such noncompliances as
are not in the aggregate reasonably likely to have a material
adverse effect on the financial condition or results of
operations of the Company and its Restricted Subsidiaries, taken
as a whole.
SECTION 4.08.SEC Reports.
Notwithstanding that the Company may not be, or may not be
required to remain, subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Company shall file
with the Commission (unless the Commission will not accept such
filing) and provide the Trustee and Holders of the Notes with
such annual reports and such information, documents and other
reports as are specified in Sections 13 and 15(d) of the Exchange
Act and applicable to a U.S. corporation subject to such
Sections, such information, documents and other reports to be so
filed and provided at the times specified for the filing of such
information, documents and reports under such Sections. In
addition, for so long as any Notes remain outstanding, the
Company shall furnish to the Holders and to securities analysts
and prospective investors, upon their request, the information,
if any, required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act. Notwithstanding anything herein to the
contrary, the Trustee shall have no duty to review such documents
for purposes of determining their compliance with any provision
of this Indenture.
<PAGE>SECTION 4.09. Waiver of Stay, Extension or
Usury Laws.
Each Obligor covenants (to the extent that it may lawfully
do so) that it will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any
stay or extension law or any usury law or other law that would
prohibit or forgive any Obligor from paying all or any portion of
the principal of or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or which
may affect the covenants or the performance of this Indenture;
and (to the extent that it may lawfully do so) each Obligor
hereby expressly waives all benefit or advantage of any such law,
and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no
such law had been enacted.
SECTION 4.10.Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, (i) declare or
pay any dividend or make any distribution or other payment on or
in respect of its Capital Stock (including any payment in
connection with any merger or consolidation involving the Company
or a Restricted Subsidiary) except dividends or distributions or
payments payable solely in its Capital Stock (other than
Disqualified Stock) or in options, warrants or other rights to
purchase such Capital Stock and except dividends or distributions
payable to the Company or a Guarantor, (ii) purchase, redeem,
retire or otherwise acquire for value any Capital Stock of the
Company or any Restricted Subsidiary held by Persons other than
the Company or a Guarantor (including any payment in connection
with any merger or consolidation involving the Company or a
Restricted Subsidiary), (iii) make any payment on or with respect
to, or purchase, repurchase, redeem, defease or otherwise acquire
or retire for value, any Subordinated Obligations, except a
payment of any interest or any principal installment at its
stated maturity or due date (and except for the purchase,
repurchase or other acquisition of Subordinated Obligations
purchased in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case
due within one year of the date of acquisition); provided after
giving effect to such payment with respect to a Gem Note, no
Default or Event of Default would then exist; or (iv) make any
Restricted Investment in any Person (any such dividend,
distribution, purchase, redemption, repurchase, defeasance, other
acquisition, retirement or Investment being herein referred to as
a "Restricted Payment"), unless, at the time of and after giving
effect to such Restricted Payment:
(A) no Default or Event of Default shall have occurred and
be continuing or would occur as a consequence thereof;
(B) the Company would, at the time of such Restricted
Payment and after giving pro forma effect to such Restricted
Payment, have been permitted to incur at least $1.00 of
additional Indebtedness under the Consolidated Coverage Ratio
test set forth in Section 4.12(a); and
(C) such Restricted Payment, together with the aggregate of
all other Restricted Payments made by the Company and its
Restricted Subsidiaries after March 31, 1997 (excluding the
Restricted Payments permitted by the next succeeding paragraph),
is less than the sum of (i) 50% of the Consolidated Net Income of
the Company for the period (taken as one accounting
<PAGE>period) from March 31, 1997 to the end of the Company's
most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment
(or, if such Consolidated Net Income for such period is a
deficit, less 100% of such deficit), plus (ii) 100% of the
aggregate net cash proceeds received by the Company from capital
contributions or the issue or sale after the Issue Date of
Capital Stock of the Company or of debt securities of the Company
that have been converted into such Capital Stock (other than
Capital Stock (or convertible debt securities) sold to a
Subsidiary of the Company and other than Disqualified Stock or
debt securities that have been converted into Disqualified
Stock), plus (iii) to the extent that any Restricted Investment
that was made after the Issue Date is sold for cash or otherwise
liquidated or repaid for cash, the lesser of (A) the cash return
of capital with respect to such Restricted Investment (less the
cost of disposition, if any) and (B) the initial amount of such
Restricted Investment, plus (iv) 50% of any dividends or
distributions received by the Company or a Restricted Subsidiary
after the Issue Date with respect to a Restricted Investment, to
the extent that such dividends or distributions were not
otherwise included in Consolidated Net Income of the Company for
such period or in the immediately preceding clause (iii),
provided that clause (iii) and (iv) of this paragraph (C) shall
not include cash proceeds received from Restricted Investments
and applied pursuant to clause (iv) of Section 4.10(b).
(b) Notwithstanding the foregoing, Section 4.10(a) will not
prohibit any of (i) the payment of any dividend or other
distribution within 60 days after the date of declaration
thereof, if at said date of declaration no Default or Event of
Default exists and such payment would have complied with the
provisions of the Indenture; (ii) the making of any Restricted
Investment, or the redemption, repurchase, retirement or other
acquisition of any Capital Stock of the Company, in either case
in exchange for, or out of the proceeds of, a substantially
concurrent capital contribution or sale (other than by or to a
Subsidiary of the Company) of Capital Stock of the Company (other
than any Disqualified Stock), provided that the amount of any
such net cash proceeds that are utilized for any such redemption,
repurchase, retirement or other acquisition shall be excluded
from clause (C)(ii) of Section 4.10(a); (iii) the defeasance,
redemption, prepayment or repurchase of Subordinated Obligations
with the net cash proceeds from (a) an incurrence of Refinancing
Indebtedness or (b) a substantially concurrent capital
contribution or sale (other than by or to a Subsidiary of the
Company) of Capital Stock of the Company (other than Disqualified
Stock); provided that the amount of any such net cash proceeds
referred to in clause (b) that are utilized for any such
redemption, repurchase, prepayment, retirement or other
acquisition shall be excluded from clause (C)(ii) of Section
4.10(a); (iv) Restricted Investments in any Person or Persons
primarily engaged in a Related Business in an aggregate amount
outstanding at any time, net of any net cash proceeds received by
the Company or a Guarantor therefrom (but only to the extent not
otherwise included in the Consolidated Net Income of the
Company), not to exceed $10.0 million; and (v) any redemption
required pursuant to Section 3.08.
(c) The Company may designate any Restricted Subsidiary,
other than a Specified Subsidiary, to be an Unrestricted
Subsidiary if such designation would not cause a Default and the
other conditions set forth in Section 4.19 are satisfied. For
purposes of making such determination, all outstanding
Investments by the Company and its Restricted Subsidiaries
(except to the extent repaid in cash) in the Subsidiary so
designated will be deemed to be Restricted Payments at the time
of such designation and will reduce the amount available for
Restricted
<PAGE>Payments. All such outstanding Investments will be deemed
to constitute Investments in an amount equal to the greatest of
(i) the net book value of such Investments at the time of such
designation, (ii) the Fair Market Value of such Investments at
the time of such designation and (iii) the original Fair Market
Value of such Investments at the time they were made. Such
designation will only be permitted if such Restricted Payment
would be permitted at such time and if such Restricted Subsidiary
otherwise meets the conditions set forth in Section 4.19.
SECTION 4.11.Limitation on Transactions with
Affiliates.
(a) The Company shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, conduct any
business, enter into or permit to exist any transaction or series
of transactions (including the purchase, conveyance, disposition,
sale, lease or exchange of any property or the rendering of any
service) with any Affiliate of the Company (an "Affiliate
Transaction") unless: (i) the terms of such Affiliate Transaction
are (x) set forth in writing, (y) in the best interest of the
Company or such Restricted Subsidiary, as the case may be, (z) as
favorable to the Company or such Restricted Subsidiary, as the
case may be, as those that could be obtained at the time of such
transaction for a similar transaction in arms' length dealings
with a Person who is not such an Affiliate and (ii) (x) with
respect to an Affiliate Transaction involving aggregate payments
or value of $1 million or greater, the Board of Directors of the
Company (including a majority of the Independent Directors) have
determined in their good faith judgment that the criteria set
forth in clauses (i) (y) and (z) are satisfied and have approved
the relevant Affiliate Transaction, such approval to be evidenced
by a Board Resolution and an Officers' Certificate and (y) with
respect to an Affiliate Transaction involving aggregate payments
or value of $5 million or greater, the Company obtains from an
independent nationally recognized accounting, appraisal or
investment banking firm experienced in the review of similar
types of transactions a written opinion addressed to the Trustee
that such Affiliate Transaction is fair, from a financial point
of view, to the Company or such Restricted Subsidiary, as the
case may be.
(b) Section 4.11(a) shall not prohibit (i) any Restricted
Payment permitted to be paid pursuant to Section 4.10 above, (ii)
any issuance of securities, or other payments, awards or grants
in cash, securities or otherwise pursuant to, or the funding of,
employment arrangements, stock options and stock ownership and/or
employee benefit plans entered into in the ordinary course of
business, approved by the Board of Directors and consistent with
past practices of the Company, (iii) loans or advances to
employees in the ordinary course of business in accordance with
past practices of the Company, (iv) the payment of reasonable
fees to directors of the Company and its Restricted Subsidiaries
who are not employees of the Company or its Restricted
Subsidiaries, or (v) any transaction between the Company and a
Guarantor that is a Wholly-Owned Subsidiary or between Guarantors
that are Wholly-Owned Subsidiaries.
SECTION 4.12.Limitation on Indebtedness.
(a) The Company shall not, and shall not permit any
Restricted Subsidiary to, Incur any Indebtedness; provided,
however, that the Company or any Guarantor may Incur Indebtedness
if on the date thereof, and giving pro forma effect to the
Incurrence thereof, the Consolidated Coverage Ratio would be
greater than 2:1.
<PAGE>(b) Notwithstanding Section 4.12(a), the Company and
its Restricted Subsidiaries may Incur the following Indebtedness:
(i) Indebtedness under the Revolving Credit Facility in an
aggregate amount outstanding at any time not to exceed $140
million (less the amount of any permanent reductions in the
amount of available borrowings under the Revolving Credit
Facility as a result of repayments made thereunder pursuant to
Section 4.15; (ii) Indebtedness outstanding under any Non-
Recourse FF&E Financing or the Vicksburg Note; (iii) Indebtedness
under one or more Recourse FF&E Financings, that, when added to
all Indebtedness then outstanding under other Recourse FF&E
Financings, and all refinancing Indebtedness with respect
thereto, does not exceed $15 million in the aggregate; (iv)
Indebtedness outstanding on the Issue Date immediately after
issuance of the Notes and application of the proceeds therefrom
(other than Indebtedness described in clause (i), (ii), (iii),
(v), (vi) or (viii) of this Section 4.12(b)), provided that the
amount thereof, together with any Refinancing Indebtedness with
respect thereto, does not exceed the amount outstanding on the
Issue Date; (v) Indebtedness evidenced by the Notes, the New
Notes and the Subsidiary Guarantees; (vi) Indebtedness of the
Company owing to and held by any Guarantor or Indebtedness of a
Restricted Subsidiary owing to and held by the Company; provided,
however, that any subsequent issuance or transfer of any Capital
Stock or other event which results in any such Guarantor ceasing
to be a Guarantor or any subsequent transfer of any such
Indebtedness (except to the Company or a Guarantor) shall be
deemed, in each case, to constitute the Incurrence of such
Indebtedness by the issuer; (vii) Indebtedness under Interest
Rate Protection Agreements related to Indebtedness permitted
under the Indenture; provided, however, such Interest Rate
Protection Agreements do not increase the consolidated
Indebtedness of the Company outstanding at any time other than as
a result of fluctuations in the exchange rates or interest rates
or by reason of customary fees, indemnities and compensation
payable thereunder; (viii) Indebtedness under the Gem Notes;
provided, however, that any event that results in any Gem Note
ceasing to meet the conditions of the definition thereof shall be
deemed to constitute the Incurrence of such Indebtedness by the
obligor thereof; (ix) Indebtedness Incurred solely in respect of
performance bonds or completion guarantees, to the extent that
such Incurrence does not result in the Incurrence of any
obligation for the payment of borrowed money to others; (x)
Refinancing Indebtedness Incurred in respect of Indebtedness
Incurred pursuant to Section 4.12(a) or the foregoing clauses
(ii), (iii) and (iv); (xi) Indebtedness arising out of standby
letters of credit covering workers compensation, performance or
similar non-Indebtedness obligations in an aggregate amount not
to exceed $500,000 at any time outstanding; and (xii)
Indebtedness (other than Indebtedness permitted by Section
4.12(a) or elsewhere in this Section 4.12(b)) in an aggregate
principal amount outstanding at any time not to exceed $5
million.
(c) For purposes of determining the outstanding principal
amount of any particular Indebtedness Incurred pursuant to this
Section 4.12, (i) Indebtedness permitted by this section need not
be permitted solely by reference to one provision permitting such
Indebtedness but may be permitted in part by one such provision
and in part by one or more other provisions of this provision
permitting such Indebtedness and (ii) in the event that
Indebtedness or any portion thereof meets the criteria of more
than one of the types of Indebtedness described in this section,
the Company, in its sole discretion, shall classify such
Indebtedness and only be required to include the amount of such
Indebtedness in one of such clauses.
<PAGE>SECTION 4.13.Limitation on Restrictions on
Distributions from Subsidiaries.
The Company shall not, and shall not permit any Restricted
Subsidiary to, create or otherwise cause or permit to exist or
become effective any encumbrance or restriction on the ability of
any Restricted Subsidiary to (i) pay dividends or make any other
distributions on its Capital Stock or pay any Indebtedness owed
to the Company or any other Restricted Subsidiary, (ii) make any
loans or advances to the Company or any other Restricted
Subsidiary, or (iii) transfer any of its property or assets to
the Company or any other Restricted Subsidiary, except: (a) any
encumbrance or restriction in effect at the Issue Date pursuant
to an agreement disclosed herein; (b) any encumbrance or
restriction with respect to a Restricted Subsidiary pursuant to
an agreement relating to any Indebtedness Incurred by such
Restricted Subsidiary prior to the date on which such Restricted
Subsidiary was acquired by the Company or another Restricted
Subsidiary (other than Indebtedness Incurred as consideration in,
or to provide all or any portion of the funds or credit support
utilized to consummate, the transaction or series of related
transactions pursuant to which such Restricted Subsidiary became
a Restricted Subsidiary or was acquired by the Company or another
Restricted Subsidiary) and outstanding on such date; (c) any
encumbrance or restriction pursuant to an agreement effecting a
refinancing of Indebtedness Incurred pursuant to an agreement
referred to in clause (a) or (b) of this provision or contained
in any amendment to an agreement referred to in clause (a) or (b)
of this provision; provided however, that the encumbrances and
restrictions contained in any such refinancing agreement or
amendment are no less favorable to the Noteholders than
encumbrances and restrictions contained in such agreements; (d)
in the case of any encumbrance or restriction referred to in
clause (iii), any such encumbrance or restriction (1) that
restricts in a customary manner the subletting, assignment or
transfer of any property or asset that is a lease, license,
conveyance or contract or similar property or asset, (2) arising
by virtue of any transfer of, agreement to transfer, option or
right with respect to, or Lien on, any property or assets of the
Company or any Restricted Subsidiary not otherwise prohibited
hereby, or (3) any encumbrance or restriction pursuant to an
agreement relating to an acquisition of property, so long as such
encumbrance or restriction relates solely to the property so
acquired; (e) any encumbrance or restriction imposed by any
Gaming Authority; and (f) any encumbrance or restriction imposed
by Legal Requirements.
SECTION 4.14.Change of Control.
(a) Upon a Change of Control, each Holder shall have the
right to require that the Company repurchase all or a part of
such Holder's Notes at a Purchase Price in cash equal to 101% of
the principal amount thereof plus accrued and unpaid interest and
Liquidated Damages, if any, to the Purchase Date.
(b) Within 30 calendar days following any Change of
Control, the Company shall send, by first-class mail, a notice to
each Holder with a copy to the Trustee stating:
(i) that a Change of Control has occurred and that
such Holder has the right to require the Company to purchase
such Holder's Notes at a Purchase Price in cash equal to
101% of the principal amount thereof plus accrued and unpaid
interest and Liquidated Damages, if any, to the Purchase
Date;
<PAGE>(ii) the circumstances and relevant facts
regarding such Change of Control which the Company in good
faith believes will enable Holders to make an informed
decision (which at a minimum will include information, if
relevant, with respect to pro forma historical income, cash
flow and capitalization, each after giving effect to such
Change of Control, events causing such Change of Control and
the date such Change of Control is deemed to have occurred);
(iii) the Purchase Date (which shall be no earlier
than 30 days and no later than 60 days from the date such
notice is mailed); and
(iv) the instructions and relevant information
determined by the Company, consistent with this provision,
that a Holder must follow or consider in order to have its
Notes purchased, which in each case shall include a summary
of the procedures, set forth in Section 4.24, to be followed
with respect to such repurchase.
(c) In making such an offer to repurchase Notes upon a
Change of Control, the Company shall comply with the procedures
set forth in Section 4.24.
SECTION 4.15.Limitation on Sales of Assets and
Restricted Subsidiary Stock.
The Company shall not, and shall not permit any Restricted
Subsidiary to, make any Asset Disposition unless (i) the Company
or such Restricted Subsidiary receives consideration at the time
of such Asset Disposition at least equal to the Fair Market
Value, as determined in good faith by the Board of Directors, the
determination of which shall be evidenced by a Board Resolution
(including as to the value of all non-cash consideration), of the
shares and assets subject to such Asset Disposition; (ii) at
least 85% of the consideration thereof received by the Company or
such Restricted Subsidiary is in the form of cash or cash
equivalents; and (iii) the Company delivers an Officers'
Certificate to the Trustee certifying that such Asset Disposition
complies with clauses (i) and (ii) (if applicable), provided,
however, that the amount of (x) any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance
sheet) of the Company or any Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms
subordinated to the Notes or any Subsidiary Guarantee) that are
assumed by the transferee of any such assets pursuant to a
customary novation or other agreement that releases the Company
or such Restricted Subsidiary from further liability and (y) any
securities, notes or other obligations received by the Company or
any such Restricted Subsidiary from such transferee that are
converted by the Company or such Restricted Subsidiary into cash
(to the extent of the cash received) within 20 Business Days
after receipt, shall be deemed to be cash for purposes of this
provision.
Net Available Cash (or any portion thereof) from any
permitted Asset Disposition or from any Event of Loss shall be
applied by the Company (or such Restricted Subsidiary, as the
case may be) within 270 days from receipt of such Net Available
Cash (a) to prepay, repay or purchase Indebtedness of a
Restricted Subsidiary that is not a Guarantor (other than any
Disqualified Stock, Preferred Stock or Subordinated Obligations
or any Indebtedness owed to the Company or any Subsidiary) or
Senior Indebtedness; and/or (b) to reinvest in Additional Assets
(including by
<PAGE>means of an Investment in Additional Assets by a Guarantor
with Net Available Cash received by the Company or another
Restricted Subsidiary); provided, however, that in connection
with any prepayment, repayment or purchase of Indebtedness
pursuant to clause (a) above, the Company or such Restricted
Subsidiary shall retire such Indebtedness and shall cause the
related loan commitment (if any) to be permanently reduced in an
amount equal to the principal amount so prepaid, repaid or
purchased; provided further, that the entering into of a binding
commitment to reinvest Net Available Cash within such 270 day
period shall be deemed to constitute reinvestment pursuant to the
foregoing clause (b) so long as such reinvestment definitively
occurs within 330 days from receipt of such Net Available Cash,
after which time such Net Available Cash shall become and be
added to any then-existing "Excess Proceeds" if such reinvestment
has not definitively occurred. Any Net Available Cash that is not
applied by the Company or its Restricted Subsidiaries in the
manner and in the relevant time periods described in the
preceding sentence shall, immediately upon expiration of such
time periods, become and be added to any then-existing "Excess
Proceeds." When the aggregate amount of Excess Proceeds (together
with income earned thereon) exceeds $5 million, the Company shall
make an offer (an "Excess Proceeds Offer") to purchase Notes
pursuant to and subject to the conditions of the following
paragraph. Pending application of Net Available Cash pursuant to
this provision, such Net Available Cash shall be invested in
Temporary Cash Investments.
In the event the Company is required to make an Excess
Proceeds Offer, it shall make an offer to purchase from all
Holders on a pro rata basis the Notes at a Purchase Price of 100%
of their principal amount plus accrued and unpaid interest and
Liquidated Damages, if any, to the Purchase Date and shall
purchase from Holders accepting such offer, the maximum principal
amount of Notes that may be purchased from funds in an amount
equal to all then-existing Excess Proceeds. Upon completion of an
Excess Proceeds Offer (including payment of the Purchase Price
for Notes duly tendered) the Excess Proceeds that were the
subject of such offer shall cease to be Excess Proceeds and the
Company or the Restricted Subsidiary that engaged in the Asset
Disposition, as applicable, may use the remaining Excess Proceeds
for general corporate purposes.
Within 10 calendar days after the date on which the Company
is required to make an Excess Proceeds Offer, the Company shall
send, by first-class mail, a notice to each Holder with a copy to
the Trustee stating:
(i) that one or more Asset Dispositions or Events of
Loss have occurred and that such Holder has the right to
require the Company to purchase such Holder's Notes at a
Purchase Price in cash equal to 100% of the principal amount
thereof plus accrued and unpaid interest and Liquidated
Damages, if any, to the Purchase Date;
(ii) the circumstances and relevant facts regarding
such Asset Disposition(s) or Event(s) of Loss which the
Company in good faith believes will enable Holders to make
an informed decision (which at a minimum will include
information, if relevant, with respect to pro forma
historical income, cash flow and capitalization, each after
giving effect to such Asset Disposition(s) or Event(s) of
Loss, events causing such Asset Disposition(s) or Event(s)
of Loss and the date such Asset Disposition(s) or Event(s)
of Loss occurred);
<PAGE>(iii) the Purchase Date (which shall be no
earlier than 30 days and no later than 60 days from the date
such notice is mailed); and
(iv) the instructions and relevant information
determined by the Company, consistent with this provision
and this Indenture, that a Holder must follow or consider in
order to have its Notes purchased, which in each case shall
include a summary of the procedures set forth in
Section 4.24, to be followed with respect to such Excess
Proceeds Offer.
In making such an Excess Proceeds Offer, the Company shall
comply with the procedures set forth in Section 4.24.
SECTION 4.16.Limitation on Issuance and Sale of
Capital Stock of Restricted Subsidiaries.
The Company shall not permit any Restricted Subsidiary to,
directly or indirectly, issue or otherwise Incur any Preferred
Stock, except for any Preferred Stock issued to and held by the
Company. The Company shall not sell or otherwise transfer any
Capital Stock of any Specified Subsidiary, and shall not permit
any Specified Subsidiary to, directly or indirectly, issue or
otherwise Incur any Capital Stock, except for (a) the sale or
other transfer of 100% of the Capital Stock of a Specified
Subsidiary in accordance with Section 4.15 or (b) the issuance or
other Incurrence of Capital Stock to or held by the Company or
another Specified Subsidiary (but only so long as such Specified
Subsidiary is a Specified Subsidiary).
SECTION 4.17.Limitation on Liens.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create or permit to exist
any Lien on any of its property or assets (including Capital
Stock), whether owned on the date hereof or thereafter acquired,
or any interest therein or income or profits therefrom, securing
any obligation other than Permitted Liens.
SECTION 4.18.Limitation of Layered Indebtedness.
The Company shall not, directly or indirectly, Incur any
Indebtedness, and shall not permit any Guarantor to Incur any
Indebtedness, that is subordinate in right of payment to any
other Indebtedness of the Company or such Guarantor, as
applicable, unless such Indebtedness is subordinate in right of
payment to, or ranks pari passu with, the Notes or the Subsidiary
Guarantee of such Guarantor in all respects.
SECTION 4.19.Limitation on Designations of Restricted
Subsidiaries and Unrestricted
Subsidiaries.
(a) Designation of a Subsidiary as a Restricted Subsidiary.
Unless the Capital Stock of any such Subsidiary is disposed of in
compliance with Section 4.15, all Specified Subsidiaries will be
Restricted Subsidiaries at all times. Any newly acquired or newly
formed Subsidiary of the Company must be designated by the Board
of Directors as a Restricted Subsidiary unless (i) it may be, and
is, designated as an Unrestricted Subsidiary by the Board of
Directors in the manner
<PAGE>provided below or (ii) it is a Subsidiary of an
Unrestricted Subsidiary. Any Unrestricted Subsidiary may be
designated by the Company as a Restricted Subsidiary; provided
that (i) at the time of such designation after giving pro forma
effect thereto, the Company would be permitted to incur $1.00 of
additional Indebtedness pursuant to the Consolidated Coverage
Ratio test contained in Section 4.12(a); and (ii) no Default or
Event of Default has occurred and is continuing immediately
preceding such designation and after giving pro forma effect
thereto.
(b) Designation of a Subsidiary as an Unrestricted
Subsidiary. Any newly-organized Subsidiary may be designated by
the Company as an Unrestricted Subsidiary at the time of its
formation, provided that such Subsidiary has total assets of
$1,000 or less at the time of such designation and the conditions
set forth in the definition of "Unrestricted Subsidiary" are
satisfied. Any Restricted Subsidiary (other than a Specified
Subsidiary) may be designated by the Company as an Unrestricted
Subsidiary (at which time the Subsidiary Guarantee of such
Restricted Subsidiary will terminate); provided that:
(i) at the time of such designation and after giving
pro forma effect thereto,
(A) the Company would be permitted to incur $1.00
of additional Indebtedness pursuant to the
Consolidated Coverage Ratio test contained in
Section 4.12(a) and
(B) the Consolidated Coverage Ratio is not less
than 80% of the Consolidated Coverage Ratio
without giving pro forma effect to such
designation;
(ii) no Default or Event of Default has occurred and is
continuing immediately preceding such designation and after
giving pro forma effect thereto, including the requirement set
forth in Section 4.10(c) that any Investment in such Restricted
Subsidiary be deemed to be a Restricted Payment made on the date
of such designation; and
(iii) the conditions set forth in the definition of
"Unrestricted Subsidiary" are satisfied.
(c) Any designation by the Board of Directors pursuant to
the foregoing provisions shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the Board Resolution
giving effect to such designation and an Officers' Certificate
certifying that such designation complies with the foregoing
provisions.
SECTION 4.20.Repurchase of Notes on Loss of Material
Gaming License.
If (i) a Gaming License of the Company or any Restricted
Subsidiary is revoked or terminated, or if any such Gaming
License is suspended or otherwise ceases to be effective, in any
case resulting in the cessation or suspension of operation for a
period of more than 90 days of the gaming business of any Gaming
Establishment owned, leased or operated directly or indirectly by
the Company or any of its Restricted Subsidiaries (each a
"License Loss"), and (ii) the Gaming Establishment subject to
such License Loss, during the period of four consecutive fiscal
quarters of the Company then most recently ended for which
internal financial statements are available,
<PAGE>accounted for more than 10% of the Consolidated Cash Flow
of the Company, the Company shall apply an amount equal to four
times the contribution of such Gaming Establishment to such
Consolidated Cash Flow (the "License Loss Amount"), within 40
days after such License Loss occurs, to the prepayment, repayment
or purchase of Indebtedness of a Restricted Subsidiary that is
not a Guarantor (other than any Disqualified Stock, Preferred
Stock or Subordinated Obligations or any Indebtedness owed to the
Company or any Subsidiary) or Senior Indebtedness; provided,
however, that the related loan commitment (if any) shall be
permanently reduced by an amount equal to the principal amount so
prepaid, repaid or purchased. If any part of the License Loss
Amount is not applied by the Company or its Restricted
Subsidiaries in the manner and in the 40-day period described in
the preceding sentence, the Company shall, immediately upon
expiration of such period, make an offer to purchase from all
Holders (a "License Loss Offer"), and shall purchase from Holders
accepting such offer on a pro rata basis, the maximum principal
amount of Notes that may be purchased with such unapplied portion
of the License Loss Amount, at a Purchase Price of 101% of their
principal amount plus accrued and unpaid interest and Liquidated
Damages, if any, to the Purchase Date. Notwithstanding the
foregoing, the Company will not be required to make any such
application or a License Loss Offer if, giving effect to the
License Loss on a pro forma basis, the Company's Consolidated
Coverage Ratio at the time such License Loss occurs would be at
least 2.25 to 1.
Prior to or upon the date on which the Company is required
to make a License Loss Offer, the Company shall send, by first-
class mail, a notice to each Holder with a copy to the Trustee
stating:
(i) that one or more License Losses have occurred and
that such Holder has the right to require the Company to
purchase such Holder's Notes at a Purchase Price in cash
equal to 101% of the principal amount thereof plus accrued
and unpaid interest and Liquidated Damages, if any, to the
Purchase Date;
(ii) the circumstances and relevant facts regarding
such License Loss which the Company in good faith believes
will enable Holders to make an informed decision (which at a
minimum will include information, if relevant, with respect
to pro forma historical income, cash flow and
capitalization, each after giving effect to such License
Loss, events causing such License Loss(es) and the date such
License Loss(es) occurred);
(iii) the Purchase Date (which shall be no earlier
than 30 days and no later than 60 days from the date such
notice is mailed); and
(iv) the instructions and relevant information
determined by the Company, consistent with this Indenture,
that a Holder must follow or consider in order to have its
Notes purchased which, in each case shall include a summary
of the procedures set forth in Section 4.24, to be followed
with respect to such License Loss Offer.
In making such a License Loss Offer, the Company shall
comply with the procedures set forth in Section 4.24.
<PAGE>SECTION 4.21. Limitation on Other Business
Activities.
The Company shall not, and shall not permit any Restricted
Subsidiary to, engage, directly or indirectly, in any business
other than a Related Business.
SECTION 4.22.Additional Subsidiary Guarantees.
If (i) CPI shall have received all requisite approvals by
the relevant Gaming Authorities, or (ii) (A) the Company or any
of its Restricted Subsidiaries shall acquire, create or designate
another Restricted Subsidiary after the date hereof and (B) all
requisite approvals by the relevant Gaming Authorities shall have
been received, the Company shall cause CPI or such other
Restricted Subsidiary to execute a supplement to this Indenture
substantially in the form of Exhibit E hereto and providing for
the issuance of a Subsidiary Guarantee. ACCBI shall be a
Guarantor at all times after the approvals contemplated by
Section 12.15 have been obtained, and the Company shall notify
the Trustee and each Noteholder of the receipt of such approvals.
The Company agrees to use its best efforts to obtain all such
approvals from Gaming Authorities. Upon execution of any such
supplement providing for a Subsidiary Guarantee, the relevant
Subsidiary will deliver to the Trustee an Opinion of Counsel
(including opinions of local counsel in the relevant
jurisdictions) relating to such Subsidiary, the authorization and
enforceability of such Subsidiary Guarantee in accordance with
the terms hereof, subject to the effect of applicable bankruptcy,
insolvency or similar laws affecting creditors rights generally
and equitable principles of general applicability, and the other
matters covered by the opinions rendered with respect to the
Initial Guarantors and their respective Subsidiary Guarantees on
the Issue Date, in each case substantially similar in scope and
form to such opinions rendered on the Issue Date.
SECTION 4.23.Payment for Consents.
Neither the Company nor any of its Subsidiaries will,
directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to
any Holder of any Notes for or as an inducement to any consent,
waiver or amendment of any of the terms or provisions hereof or
the Notes unless such consideration is offered to be paid or is
paid to all Holders of the Notes that consent, waive or agree to
amend in the time frame set forth in the solicitation documents
relating to such consent, waiver or agreement.
SECTION 4.24.General Procedures for Purchase of Notes.
The following procedures shall apply to (i) any offer to
repurchase Notes upon a Change of Control pursuant to Section
4.14, (ii) any Excess Proceeds Offer pursuant to Section 4.15, or
(iii) any License Loss Offer pursuant to Section 4.20 (each a
"Repurchase Offer"):
(a) The Holders electing to have a Note purchased will be
required to surrender such Note, with an appropriate form duly
completed, to the Company at the address specified in the notice
at least five Business Days prior to the Purchase Date. Holders
will be entitled to withdraw their election if the Trustee or the
Company receives not later than three Business Days prior to the
Purchase Date, a telegram, telex, facsimile transmission or
letter setting forth the
<PAGE>name of the Holder, the principal amount of the Note which
was delivered for purchase by the Holder and a statement that
such Holder is withdrawing his election to have such Note
purchased.
(b) On the Purchase Date, (i) all Notes or portions thereof
purchased by the Company pursuant to a Repurchase Offer shall be
delivered by the Trustee for cancellation, (ii) the Company shall
pay the Purchase Price plus accrued and unpaid interest and
Liquidated Damages, if any, to the Holders entitled thereto, (ii)
the Company shall promptly issue a new Note, and (iv) the
Trustee, upon written request from the Company shall authenticate
and mail or deliver such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered,
provided that each such new Note shall be in a principal amount
of $1,000 or an integral multiple thereof. Any Note not so
accepted shall be promptly mailed or delivered by the Company to
the Holder thereof.
(c) The Company shall publicly announce the results of the
applicable Repurchase Offer on or as soon as practicable after
the Purchase Date, but in no case more than five Business Days
after such Purchase Date.
(d) If the Company complies with this Section 4.24 and the
other requirements related to a Repurchase Offer, on and after
the Purchase Date, interest shall cease to accrue on the Notes or
the portions of Notes called for repurchase. If a Note is
repurchased after a Record Date but on or prior to the related
Interest Payment Date, then any accrued and unpaid interest shall
be paid to the Person in whose name such Note was registered at
the close of business on such Record Date. If any Note called
for repurchase shall not be so paid upon surrender for repurchase
because of the failure of the Company to comply with this Section
4.24, interest shall be paid on the unpaid principal, from the
Purchase Date until such principal is paid, and to the extent
lawful on any interest not paid on such unpaid principal, in each
case at the rate provided in Section 4.01(c).
(e) The Company shall comply, to the extent applicable,
with the requirements of Section 14(e) of the Exchange Act and
any other securities laws or regulations in connection with the
Repurchase Offers described herein. To the extent that the
provisions of any securities laws or regulations conflict with
this provision, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have
breached its obligations under this provision by virtue thereof.
(f) Other than as specifically provided in this
Section 4.24, any Repurchase Offer pursuant to this Section 4.24
shall be made pursuant to the provisions of Sections 4.14, 4.15
or 4.20, as the case may be.
<PAGE>ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01.Merger, Consolidation and Sale of Assets.
The Company shall not consolidate with or merge with or
into, or convey, lease or otherwise transfer all or substantially
all its assets to, any Person, and shall not permit one or more
Restricted Subsidiaries representing all or substantially all of
the assets of the Company to consolidate with or merge with or
into or convey, lease or otherwise transfer all or substantially
all of its assets to, any Person other than the Company, unless:
(i) the resulting, surviving or transferee Person shall be a
corporation organized and existing under the laws of the United
States of America, any State thereof or the District of Columbia
and such Person (if not the Company) shall expressly assume, by
an indenture supplemental to this Indenture, executed and
delivered to the Trustee, in form satisfactory to the Trustee,
all the obligations of the Company under the Notes and this
Indenture; (ii) immediately before and after giving effect to
such transaction or series of transactions on a pro forma basis
(and treating any Indebtedness which becomes an obligation of
such Person or any Restricted Subsidiary as a result of such
transaction as having been Incurred by such Person or such
Restricted Subsidiary at the time of such transaction), no
Default or Event of Default shall have occurred and be
continuing; (iii) immediately after giving effect to such
transaction or series of transactions on a pro forma basis (and
treating any Indebtedness which becomes an obligation of such
Person or any Restricted Subsidiary as a result of such
transaction as having been Incurred by such Person or such
Restricted Subsidiary at the time of such transaction), such
Person would be able to incur an additional $1.00 of Indebtedness
under Section 4.12(a), (iv) immediately after giving effect to
such transaction or series of transactions, on a pro forma basis
(and treating any Indebtedness which becomes an obligation of
such Person or any Restricted Subsidiary as a result of such
transaction as having been Incurred by such Person or such
Restricted Subsidiary at the time of such transaction or series
of transactions), such Person shall have Consolidated Net Worth
in an amount which is not less than the Consolidated Net Worth of
the Company immediately prior to such transaction; (v) any such
transaction would not require any Holder of Notes to obtain a
Gaming License or be qualified under the laws of any applicable
gaming jurisdiction in the absence of such transaction, provided
that a transaction involving a jurisdiction that does not require
the licensing or qualification of all of the holders of the
Notes, but reserves the discretionary right to require the
licensing or qualification of any holder of Notes, shall not be
prohibited pursuant to the terms of this clause (v); (vi) any
such transaction would not result in the loss of any
qualification or any material Gaming License of the Company or
its Subsidiaries; and (vii) the Company shall have delivered to
the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and such
supplemental indenture (if any) comply herewith.
No Guarantor may consolidate with or merge with or into
(whether or not such Guarantor is the surviving Person), another
Person whether or not affiliated with such Guarantor, unless (i)
the resulting, surviving or transferee Person shall be a
corporation organized and existing under the laws of the United
States of America, any State thereof or the District of Columbia
and such Person (if not the Company) shall expressly assume, by
an indenture supplemental to this
<PAGE>Indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all the obligations of such
Guarantor under its Subsidiary Guarantee and this Indenture; (ii)
immediately before and after giving effect to such transaction or
series of transactions on a pro forma basis (and treating any
Indebtedness which becomes an obligation of such Person or any
Restricted Subsidiary as a result of such transaction as having
been Incurred by such Person or such Restricted Subsidiary at the
time of such transaction), no Default or Event of Default shall
have occurred and be continuing; (iii) immediately after giving
effect to such transaction or series of transactions on a pro
forma basis (and treating any Indebtedness which becomes an
obligation of such Person or any Restricted Subsidiary as a
result of such transaction as having been Incurred by such Person
or such Restricted Subsidiary at the time of such transaction),
the Company would be able to incur an additional $1.00 of
Indebtedness under the Section 4.12(a); (iv) immediately after
giving effect to such transaction or series of transactions, on a
pro forma basis (and treating any Indebtedness which becomes an
obligation of such Person or any Restricted Subsidiary as a
result of such transaction as having been Incurred by such Person
or such Restricted Subsidiary at the time of such transaction or
series of transactions), such Person shall have consolidated net
worth in an amount which is not less than the consolidated net
worth of such Guarantor immediately prior to such transaction;
(v) any such transaction would not result in the loss of any
qualification or any material Gaming License of the Company or
its Subsidiaries; and (vi) the Company shall have delivered to
the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and such
supplemental indenture (if any) comply with the Indenture;
provided that this paragraph shall not apply to an Asset
Disposition subject to and complying with Section 4.15.
The resulting, surviving or transferee Person in any such
transaction involving the Company or any Guarantor shall succeed
to, and be substituted for, and may exercise every right and
power of, the Company or such Guarantor under this Indenture, but
the Company in the case of a lease shall not be released from the
obligation to pay the principal of and interest on the Notes.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01.Events of Default.
(a) An "Event of Default" occurs if:
(i) the Company defaults in any payment of interest on, or
Liquidated Damages, if any, with respect to, any Note when the
same becomes due and payable (whether or not prohibited by
Article Ten), and such default continues for a period of 30 days;
(ii) the Company defaults in the payment of the principal of
any Note when the same becomes due and payable at its Stated
Maturity, on a Redemption Date, Purchase Date, upon acceleration
or otherwise (whether or not prohibited by Article Ten);
(iii) the Company or any Guarantor fails to comply with
Sections 4.10, 4.12, 4.14, 4.15 or 4.20 or Article Five;
(iv) the Company or any Guarantor fails to comply with any
of its agreements in the Notes or the Indenture (other than those
referred to in (i), (ii) or (iii) above) and such failure
continues for 30 days after the notice to the Company from the
Trustee or Holders of at least 25% in principal amount of the
Notes specified below or, if the Company fails to timely give the
notice to the Trustee specified below, such failure continues for
30 days after the date such notice should have been given by the
Company;
(v) any installment of principal of, or any premium or
accrued and unpaid interest on, any Indebtedness of the Company
or any Restricted Subsidiary is not paid within any applicable
grace period after its maturity or any such Indebtedness is
accelerated by the holders thereof because of a default, or any
such Indebtedness is required to be repurchased or prepaid, and
the total amount of interest, premium, principal or other amount
with respect to such Indebtedness that is unpaid, accelerated or
required to be repurchased or prepaid exceeds $5 million at the
time, provided that this clause (v) shall not apply to any
failure to make any scheduled payment of principal of, or
interest on, any Gem Note, but only if the consequence of such
failure is limited to an increase of the interest rate, and/or
the compounding of interest, applicable thereto and, without
limitation, does not include a right under such Gem Note or under
applicable law to accelerate the due date of, or in any way
enforce, such Gem Note;
(vi) the Company or any Restricted Subsidiary pursuant to or
within the meaning of any Bankruptcy Law: (a) commences a
voluntary case; (b) consents to the entry of an order for relief
against it in an involuntary case; (c) consents to the
appointment of a Custodian of it or for any substantial part of
its property; (d) makes a general assignment for the benefit of
its creditors; or (e) takes any comparable action under any
foreign laws relating to insolvency;
(vii) a court of competent jurisdiction enters an order
or decree under any Bankruptcy Law that: (a) is for relief
against the Company or any Restricted Subsidiary in an
involuntary case; (b) appoints a Custodian of the Company or any
Restricted Subsidiary or for any substantial part of its
property; or (c) orders the winding up or liquidation of the
Company or any Restricted Subsidiary; or any similar relief is
granted under any foreign laws and the order or decree remains
unstayed and in effect for 60 days;
(viii) any judgment or decree for the payment of money in
excess of $5 million at the time is entered against the Company
or any Restricted Subsidiary and is not discharged and either (a)
an enforcement proceeding has been commenced by any creditor upon
such judgment or decree or (b) there is a period of 60 days
following the entry of such judgment or decree during which such
judgment or decree is not discharged, waived or the execution
thereof stayed; or
(ix) except as permitted by Section 11.02, any Subsidiary
Guarantee shall be held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be in
full force and effect or any Guarantor, or any Person acting on
behalf of any Guarantor, shall deny or disaffirm its obligations
under its Subsidiary Guarantee.
<PAGE>(b) The foregoing will constitute Events of Default
whatever the reason for any such Event of Default and whether it
is voluntary or involuntary or is effected by operation of law or
pursuant to any judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental
body.
(c) A Default under clause (iv) of Section 6.01(a) is not
an Event of Default until the Trustee or the Holders of at least
25% in principal amount of the Notes notify the Company of the
Default and the Company does not cure such Default within the
time specified after receipt of such notice. Such notice must
specify the Default, demand that it be remedied and state that
such notice is a "Notice of Default."
(d) The Company shall deliver to the Trustee, promptly upon
becoming aware of the occurrence thereof, written notice in the
form of an Officers' Certificate of any Event of Default or
Default under clause (iii), (iv), (v), (vi), (vii), (viii) or
(ix) of Section 6.01(a), its status and what action the Company
is taking or proposes to take with respect thereto.
SECTION 6.02.Acceleration.
(a) If an Event of Default (other than an Event of Default
specified in clauses (vi) or (vii) of Section 6.01(a) with
respect to the Company) occurs and is continuing and has not been
waived pursuant to Section 6.04, the Trustee by notice to the
Company, or the Holders of at least 25% in principal amount of
the Notes by notice to the Company and the Trustee, may declare
the principal of and accrued interest and Liquidated Damages, if
any, on all the Notes to be due and payable. Upon such a
declaration, such principal, interest and Liquidated Damages, if
any, shall be due and payable immediately.
(b) If an Event of Default specified in clause (vi) or
(vii) of Section 6.01(a) with respect to the Company occurs, the
principal of and interest and Liquidated Damages, if any, on all
the Notes shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the
Trustee or any Noteholders.
(c) In the case of any Event of Default occurring by reason
of any willful action (or inaction) taken (or not taken) by or on
behalf of the Company with the intention of avoiding payment of
the premium that the Company would have had to pay if the Company
then had elected to redeem the Notes pursuant to Section 3.07(a),
an equivalent premium shall also become and be immediately due
and payable to the extent permitted by law upon the acceleration
of the Notes. If an Event of Default occurs prior to August 1,
2001, by reason of any willful action (or inaction) taken (or not
taken) by or on behalf of the Company with the intention of
avoiding the prohibition on redemption of the Notes prior to
August 1, 2001, then the premium specified in Section 3.07(c)
shall also become immediately due and payable to the extent
permitted by law upon the acceleration of the Notes.
(d) The Holders of a majority in principal amount of the
Notes by notice to the Trustee may rescind an acceleration and
its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have
been cured or waived except
<PAGE>nonpayment of principal or interest that has become due
solely because of acceleration. No such rescission shall affect
any subsequent Default or impair any right consequent thereto.
SECTION 6.03.Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity
to collect the payment of principal of or interest on the Notes
or to enforce the performance of any provision of the Notes or
this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the
proceeding. A delay or omission by the Trustee or any Noteholder
in exercising any right or remedy accruing upon an Event of
Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are
cumulative to the extent permitted by law.
SECTION 6.04.Waiver of Past Defaults.
The Holders of a majority in aggregate principal amount of
the Notes then outstanding may, by notice to the Trustee, on
behalf of the Holders of all of the Notes, waive any existing
Default or Event of Default and its consequences hereunder except
(i) a continuing Default or Event of Default in the payment of
principal of, or premium, interest or Liquidated Damages, if any,
on, the Notes, or (ii) any Default or Event of Default in respect
of a provision that under Article Nine hereof cannot be waived
without the consent of each Noteholder affected thereby.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other default or impair
any right consequent thereon.
SECTION 6.05.Control by Majority.
The Holders of a majority in principal amount of the
outstanding Notes may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on it, including,
without limitation, any remedies provided for in Section 6.03.
Subject to Section 7.01, however, the Trustee may refuse to
follow any direction that the Trustee reasonably believes
conflicts with any law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of another
Noteholder, or that may involve the Trustee in personal
liability; provided that the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with such
direction.
A Noteholder may not use this Indenture to prejudice the
rights of another Noteholder or to obtain a preference or
priority over another Noteholder.
SECTION 6.06.Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of principal of and
interest and Liquidated Damages, if any, on a Note, on or after
the
<PAGE>respective due dates expressed in such Note, or to bring
suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the
consent of such Holder.
SECTION 6.07.Collection Suit by Trustee.
If an Event of Default in payment of principal or interest
specified in clause (1) or (2) of Section 6.01 occurs and is
continuing, the Trustee may recover judgment in its own name and
as trustee of an express trust against the Company or any other
Obligor on the Notes for the whole amount of principal and
accrued interest, and Liquidated Damages, if any, remaining
unpaid, together with interest on overdue principal and, to the
extent that payment of such interest is lawful, interest on
overdue installments of interest at the rate set forth in Section
4.01 and such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
SECTION 6.08.Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have
the claims of the Trustee (including any claim for the reasonable
compensation, expenses, taxes, disbursements and advances of the
Trustee, its agents and counsel) and the Noteholders allowed in
any judicial proceedings relating to the Company or any other
obligor upon the Notes, any of their respective creditors or any
of their respective property and shall be entitled and empowered
to collect and receive any funds or other property payable or
deliverable on any such claims and to distribute the same, and
any Custodian in any such judicial proceedings is hereby
authorized by each Noteholder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Noteholders, to pay to
the Trustee any amount due to it for the reasonable compensation,
expenses, taxes, disbursements and advances of the Trustee, its
agent and counsel, and any other amounts due the Trustee under
Section 7.07. The Company's payment obligations under this
Section 6.08 shall be secured in accordance with Section 7.07.
Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any
Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the
claim of any Noteholder in any such proceeding.
SECTION 6.09.Priorities.
If the Trustee collects any funds or property pursuant to
this Article Six, it shall pay out the funds in the following
order:
First: to the Trustee for amounts due under Section
7.07;
Second: if the Holders are forced to proceed against
the Company directly without the Trustee, to Holders for
their collection costs;
<PAGE>Third: to Holders for amounts due and unpaid on
the Notes for principal and interest and Liquidated Damages,
if any, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for
principal and interest, respectively; and
Fourth: to Obligors or any other obligor on the Notes,
as their interests may appear, or as a court of competent
jurisdiction may direct.
The Trustee, upon prior notice to the Company, may fix a
record date and payment date for any payment to Noteholders
pursuant to this Section 6.09.
SECTION 6.10.Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action
taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having
due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section 6.10 does not apply to
a suit by the Trustee, a suit by a Holder pursuant to Section
6.06, or a suit by a Holder or Holders of more than 10% in
principal amount of the outstanding Notes.
SECTION 6.11.Restoration of Rights and Remedies.
If the Trustee or any Holder of Notes has instituted any
proceeding to enforce any right or remedy under this Indenture
and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, the Company, the
Trustee and the Holders shall, subject to any determination in
such proceeding, be restored severally and respectively to their
former positions hereunder, and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 6.12.Limitation on Suits.
A Noteholder may not pursue any remedy with respect hereto
or the Notes unless: (i) the Holder gives to the Trustee written
notice stating that an Event of Default is continuing; (ii) the
Holders of at least 25% in principal amount of the Notes make a
written request to the Trustee to pursue the remedy; (iii) such
Holder or Holders offer to the Trustee reasonable security or
indemnity against any loss, liability or expense; (iv) the
Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity;
and (v) the Holders of a majority in principal amount of the
Notes do not give the Trustee a direction inconsistent with the
request during such 60-day period.
<PAGE>ARTICLE SEVEN
TRUSTEE
SECTION 7.01.Duties of Trustee.
(a) If an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested
in it by this Indenture and use the same degree of care and skill
in its exercise thereof as a prudent person would exercise or use
under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties as are
specifically set forth in this Indenture and no covenants or
obligations shall be implied in this Indenture against the
Trustee.
(2) In the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and confirming to the requirements of this
Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein
contained, the Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(1) This paragraph does not limit the effect of
Section 7.01(b).
(2) The Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it is
proved that the Trustee was negligent in ascertaining the
pertinent facts.
(3) The Trustee shall not liable with respect to any
action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to Section 6.02,
6.04 or 6.05.
(d) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers if it
shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk or liability
is not reasonably assured to it.
(e) Every provision of this Indenture that in any way
relates to the Trustee is subject to this Article Seven.
<PAGE>(f) The Trustee shall not be liable for interest on
any money or assets received by it except as the Trustee may
agree in writing with the Company. Assets held in trust by the
Trustee need not be segregated from other assets except to the
extent required by law.
SECTION 7.02.Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely and shall be fully protected in
acting or refraining from acting upon any document believed by it
to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter
stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
consult with counsel and may require an Officers' Certificate or
an Opinion of Counsel, which shall conform to Sections 12.04 and
12.05. The Trustee shall not be liable for any action it takes
or omits to take in good faith in reliance on such Officers'
Certificate or Opinion of Counsel.
(c) The Trustee may act through its attorneys and agents
and shall not be responsible for the misconduct or negligence of
any agent appointed with due care.
(d) The Trustee shall not be liable for any action that it
takes or omits to take in good faith which it reasonably believes
to be authorized or within its rights or powers.
(e) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, notice, request,
direction, consent, order, bond, debenture, or other paper or
document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it
may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled, upon
reasonable notice to the Company, to examine the books, records,
and premises of the Company, personally or by agent or attorney
and to consult with the officers and representatives of the
Company, including the Company's accountants and attorneys.
(f) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request, order or direction of any of the Holders pursuant to the
provisions of this Indenture, unless such Holders shall have
offered to the Trustee security or indemnity reasonably
satisfactory to the Trustee against the costs, expenses and
liabilities which may be incurred by it in compliance with such
request, order or direction.
(g) The Trustee shall not be required to give any bond or
surety in respect of the performance of its powers and duties
hereunder.
(h) Except with respect to Section 4.01, the Trustee shall
have no duty to inquire as to the performance by the Company with
respect to the covenants contained in Article Four. In addition,
the Trustee shall not be deemed to have knowledge of a Default or
Event of Default except (i) any Default or Event of Default
occurring pursuant to Section 6.01(a)(i), 6.01(a)(ii) or 4.01 or
(ii) any Default or Event of Default of which the Trustee shall
have received written notification or obtained actual knowledge.
<PAGE>SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may
become the owner or pledgee of Notes and may otherwise deal with
the Company, any Subsidiary of the Company, or their respective
Affiliates with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. However,
the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04.Trustee's Disclaimer.
The Trustee makes no representation as to the validity or
adequacy of this Indenture or the Notes, and it shall not be
accountable for the Company's use of the proceeds from the Notes,
and it shall not be responsible for any statement of the Company
in this Indenture or the Notes other than the Trustee's
certificate of authentication.
SECTION 7.05.Notice of Default.
If a Default or Event of Default occurs and is continuing
and if the Trustee has actual knowledge of such Default or Event
of Default, the Trustee shall mail to Holders of Notes a notice
of the Default or Event of Default within 90 days after it
occurs. The Trustee may withhold from Holders of the Notes
notice of any continuing Default or Event of Default (except a
Default or Event of Default relating to the payment of principal,
premium, interest or Liquidated Damages, if any) if it determines
that withholding notice is in the best interest of the Holders.
SECTION 7.06.Reports by Trustee to Holders.
Within 60 days after each May 15, the Trustee shall, to the
extent that any of the events described in TIA Section 313(a) occurred
within the previous twelve months, but not otherwise, mail to
each Noteholder a brief report dated as of such date that
complies with TIA Section 313(a). The Trustee also shall comply with
TIA Sections 313(b), (c) and (d).
A copy of each report at the time of its mailing to
Noteholders shall be mailed to the Company and filed with the SEC
and each stock exchange, if any, on which the Notes are listed.
The Company shall promptly notify the Trustee if the Notes
become listed on any stock exchange and the Trustee shall comply
with TIA Section 313(d).
SECTION 7.07.Compensation and Indemnity.
The Company shall pay to the Trustee from time to time
reasonable compensation for its services. The Trustee's
compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable out-of-pocket expenses
incurred or made by it in connection with the performance of its
duties under this Indenture. Such expenses shall include the
reasonable fees and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee and its agents,
employees, stockholders and directors and officers for, and hold
them harmless against, any loss, liability or expense incurred
<PAGE>by them except for such actions to the extent caused by any
negligence, bad faith or willful misconduct on their part,
arising out of or in connection with the administration of this
trust including the reasonable costs and expenses of defending
themselves against any claim or liability in connection with the
exercise or performance of any of their rights, powers or duties
hereunder. The Trustee shall notify the Company promptly of any
claim asserted against the Trustee for which it may seek
indemnity. At the Trustee's sole discretion, the Company shall
defend the claim and the Trustee shall cooperate and may
participate in the defense; provided that any settlement of a
claim shall be approved in writing by the Trustee.
Alternatively, the Trustee may at its option have separate
counsel of its own choosing and the Company shall pay the
reasonable fees and expenses of such counsel; provided that the
Company will not be required to pay such fees and expenses if it
assumes the Trustee's defense and there is no conflict of
interest between the Company and the Trustee in connection with
such defense as reasonably determined by the Trustee. The
Company need not pay for any settlement made without its written
consent. The Company need not reimburse any expense or indemnify
against any loss or liability to the extent incurred by the
Trustee through its negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this Section
7.07, the Trustee shall have a lien prior to the Notes on all
assets or money held or collected by the Trustee, in its capacity
as Trustee, except assets or money held in trust to pay principal
of or interest on particular Notes. The Trustee's right to
receive payment of any amounts due under this Section 7.07 shall
not be subordinate to any other liability or indebtedness of the
Company (even though the Notes may be subordinate to such other
liability or indebtedness).
When the Trustee incurs expenses or renders services after
an Event of Default specified in Section 6.01(6) or (7) occurs,
such expenses and the compensation for such services are intended
to constitute expenses of administration under any Bankruptcy
Law.
This Section 7.07 shall survive the resignation or removal
of the Trustee and the discharge or other termination of this
Indenture.
SECTION 7.08.Replacement of Trustee.
The Trustee may resign by so notifying the Company. The
Holders of a majority in principal amount of the outstanding
Notes may remove the Trustee by so notifying the Company and the
Trustee and may appoint a successor Trustee. The Company may
remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of
the Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists
in the office of Trustee for any reason, the Company shall notify
each Holder of such event and shall promptly appoint a
<PAGE>successor Trustee. Within one year after the successor
Trustee takes office, the Holders of a majority in principal
amount of the Notes may appoint a successor Trustee to replace
the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of
its appointment to the retiring Trustee and to the Company.
Immediately after that, the retiring Trustee shall transfer all
property held by it as Trustee to the successor Trustee, subject
to the lien provided in Section 7.07, the resignation or removal
of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. A successor Trustee shall mail
notice of its succession to each Noteholder.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring
Trustee, the Company or the Holders of at least 10% in principal
amount of the outstanding Notes may petition any court of
competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any
Noteholder may petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor
Trustee.
Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.07 shall
continue for the benefit of the retiring Trustee.
SECTION 7.09.Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into,
or transfers all or substantially all of its corporate trust
business to, another corporation, the resulting, surviving or
transferee corporation without any further act shall, if such
resulting, surviving or transferee corporation is otherwise
eligible hereunder, be the successor Trustee; provided that such
corporation shall be otherwise qualified and eligible under this
Article Seven.
SECTION 7.10.Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA Sections 310(a)(l), (2) and (5). The Trustee (or,
in the case of a corporation included in a bank holding company
system, the related bank holding company) shall have a combined
capital and surplus of at least $50 million as set forth in its
most recent published annual report of condition. In addition,
if the Trustee is a corporation included in a bank holding
company system, the Trustee, independently of such bank holding
company, shall meet the capital requirements of TIA Section 310(a)(2).
The Trustee shall comply with TIA Section 310(b); provided, however,
that there shall be excluded from the operation of TIA Section
310(b)(1) any indenture or indentures under which other
securities, or certificates of interest or participation in other
securities, of the Company are outstanding, if the requirements
for such exclusion set forth in TIA Section 310(b)(1) are met. The
provisions of TIA Section 310 shall apply to the Company, as obligor of
the Notes.
<PAGE>SECTION 7.11. Preferential Collection of
Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the
extent indicated therein. The provisions of TIA Section 311 shall
apply to the Company, as obligor on the Notes.
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01.Termination of the Company's Obligations.
The Obligors may terminate their respective obligations
under the Notes and this Indenture, except those obligations
referred to in the penultimate paragraph of this Section 8.01, if
all Notes previously authenticated and delivered (other than
destroyed, lost or stolen Notes which have been replaced or paid
or Notes for whose payment U.S. Legal Tender have theretofore
been deposited with the Trustee or the Paying Agent or a trustee
satisfactory to the Trustee in trust or segregated and held in
trust by the Company and thereafter repaid to the Company, as
provided in Section 8.05) have been delivered to the Trustee for
cancellation and the Company has paid all sums payable by it
hereunder, or if:
(a) either (i) pursuant to Article Three, the Company
shall have given notice to the Trustee and mailed a notice
of redemption to each Holder of the redemption of all of the
Notes under arrangements satisfactory to the Trustee for the
giving of such notice or (ii) all Notes have otherwise
become due and payable hereunder;
(b) the Company shall have irrevocably deposited or
caused to be deposited with the Trustee, the Paying Agent or
a trustee satisfactory to the Trustee, under the terms of an
irrevocable trust agreement in form and substance
satisfactory to the Trustee, as trust funds in trust solely
for the benefit of the Holders for that purpose, U.S. Legal
Tender in such amount as is sufficient without consideration
of reinvestment of such interest, to pay principal of,
premium and Liquidated Damages, if any, and interest on the
outstanding Notes to maturity or redemption; provided that
the Trustee shall have been irrevocably instructed to apply
such U.S. Legal Tender to the payment of said principal,
premium and Liquidated Damages, if any, and interest with
respect to the Notes and, provided, further, that from and
after the time of deposit, the money deposited shall not be
subject to the rights of holders of Senior Indebtedness
pursuant to Article Ten;
(c) no Default or Event of Default with respect to
this Indenture or the Notes shall have occurred and be
continuing on the date of such deposit or shall occur as a
result of such deposit and such deposit will not result in a
breach or violation of, or constitute a default under, any
other instrument to which the Company is a party or by which
it is bound;
(d) the Company shall have paid all other sums payable
by it hereunder; and
<PAGE>(e) the Company shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent providing for the
termination of the Company's obligations under the Notes and
this Indenture have been complied with. Such Opinion of
Counsel shall also state that such satisfaction and
discharge does not result in a default under any agreement
or instrument then known to such counsel that binds or
affects the Company.
Notwithstanding the foregoing paragraph, the Company's
obligations in Sections 2.05, 2.06, 2.07, 2.08, 2.10, 2.15, 2.16,
2.17, 4.01, 4.02, 7.07, 8.05 and 8.06 shall survive until the
Notes are no longer outstanding pursuant to the last paragraph of
Section 2.08. After the Notes are no longer outstanding, the
Company's rights and obligations in Sections 7.07, 8.05 and 8.06
shall survive.
After such delivery or irrevocable deposit, the Trustee upon
request shall acknowledge in writing the discharge of the
Obligors' obligations under the Notes and this Indenture except
for those surviving obligations specified above.
SECTION 8.02.Legal Defeasance and Covenant Defeasance.
(a) The Company may, at its option by Board Resolution of
the Board of Directors of the Company, at any time, elect to have
either Section 8.02(b) or Section 8.02(c) be applied to all
outstanding Notes upon compliance with the conditions set forth
in Section 8.03.
(b) Upon the Company's exercise under Section 8.02(a) of
the option applicable to this Section 8.02(b), the Obligors
shall, subject to the satisfaction of the conditions set forth in
Section 8.03, be deemed to have been discharged from their
respective obligations with respect to all outstanding Notes on
the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, Legal
Defeasance means that the Company shall be deemed to have paid
and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.04 and the other
Sections of this Indenture referred to in (i) and (ii) below, and
to have satisfied all its other obligations under such Notes and
this Indenture (and the Trustee, on demand of and at the expense
of the Company, shall execute proper instruments acknowledging
the same), and Holders of the Notes and any amounts deposited
under Section 8.03 shall cease to be subject to any obligations
to, or the rights of, any holder of Senior Indebtedness under
Article Ten or otherwise, except for the following provisions,
which shall survive until otherwise terminated or discharged
hereunder: (i) the rights of Holders of outstanding Notes to
receive solely from the trust fund described in Section 8.04, and
as more fully set forth in Section 8.04, payments in respect of
the principal of and interest and Liquidated Damages, if any, on
such Notes when such payments are due, (ii) the Company's
obligations with respect to such Notes under Sections 2.05, 2.06,
2.07, 2.08, 2.10, 2.15, 2.16, 2.17, 4.01, 4.02, 7.07, 8.05 and
8.06 hereof, (iii) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and the Company's obligations
in connection therewith and (iv) this Article Eight. Subject to
compliance with this Article Eight, the Company may exercise its
option under this Section 8.02(b) notwithstanding the prior
exercise of its option under Section 8.02(c).
<PAGE>(c) Upon the Company's exercise under Section 8.02(a)
of the option applicable to this Section 8.02(c), the Obligors
shall, subject to the satisfaction of the conditions set forth in
Section 8.03, be released from their respective obligations under
the covenants contained in Sections 4.05 through 4.23, inclusive,
any covenant added to this Indenture subsequent to the date
hereof and Article Five with respect to the outstanding Notes on
and after the date the conditions set forth below are satisfied
(hereinafter, "Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such
covenants, but shall continue to be deemed "outstanding" for all
other purposes hereunder (it being understood that such Notes
shall not be deemed outstanding for accounting purposes) and
Holders of the Notes and any amounts deposited under Section 8.03
shall cease to be subject to any obligations to, or the rights
of, any holder of Senior Indebtedness under Article Ten or
otherwise. For this purpose, such Covenant Defeasance means
that, with respect to the outstanding Notes, the Obligors may
omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any
reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not
constitute a Default or an Event or Default under Section
6.01(a)(iii) or (iv), but, except as specified above, the
remainder of this Indenture and such Notes shall be unaffected
thereby. In addition, upon the Company's exercise under
Section 8.02(a) of the option applicable to this Section 8.02(c),
subject to the satisfaction of the conditions set forth in
Section 8.03, Section 6.01(a)(v), 6.01(a)(viii) and 6.01(a)(ix)
shall not constitute Events of Default.
SECTION 8.03.Conditions to Legal Defeasance or
Covenant Defeasance.
The following shall be the conditions to the application of
either Section 8.02(b) or 8.02(c) to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant
Defeasance:
(a) the Company must irrevocably deposit with the
Trustee, in trust, for the benefit of the Holders,
unencumbered U.S. Legal Tender or U.S. Government
Obligations, or a combination thereof, in such amounts as
will be sufficient, in the opinion of a nationally
recognized firm of independent public accountants, to pay
the principal of and interest and Liquidated Damages, if
any, on the Notes on the stated date for payment thereof or
on the applicable Redemption Date, as the case may be, of
such principal or installment of principal of or interest on
the Notes; provided that the Trustee shall have received an
irrevocable written order from the Company instructing the
Trustee to apply such U.S. Legal Tender or the proceeds of
such U.S. Government Obligations to said payments with
respect to the Notes;
(b) in the case of an election under Section 8.02(b),
the Company shall have delivered to the Trustee an Opinion
of Counsel in the United States reasonably acceptable to the
Trustee confirming that (A) the Company has received from,
or there has been published by, the Internal Revenue Service
a ruling or (B) since the date of this Indenture, there has
been a change in the applicable federal income tax law, in
either case to the
<PAGE>effect that, and based thereon such Opinion of Counsel
shall confirm that, the Holders of the Notes will not
recognize income, gain or loss for federal income tax
purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the
case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.02(c),
the Company shall have delivered to the Trustee an Opinion
of Counsel in the United States reasonably acceptable to the
Trustee confirming that the Holders of the Notes will not
recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the
case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default or event which with
notice or lapse of time or both would become a Default or an
Event of Default with respect to the Notes shall have
occurred and be continuing on the date of such deposit
(other than a Default or Event of Default resulting from the
incurrence of Indebtedness all or a portion of the proceeds
of which will be used to defease the Notes pursuant to this
Article Eight concurrently with such incurrence) or insofar
as Sections 6.01(vi) and 6.01(vii) are concerned, at any
time in the period ending on the 91st day after the date of
such deposit (and any such Legal Defeasance or Covenant
Defeasance shall not take effect until such day);
(e) such Legal Defeasance or Covenant Defeasance shall
not result in a breach or violation of or constitute a
default under this Indenture or any other material agreement
or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company or any of
its Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made
by the Company with the intent of preferring the Holders
over any other creditors of the Company or with the intent
of defeating, hindering, delaying or defrauding any other
creditors of the Company or others;
(g) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for or
relating to the Legal Defeasance or the Covenant Defeasance
have been complied with; and
(h) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that (i) the trust funds
will not be subject to any rights of any holders of
Indebtedness of the Company other than the Notes, and
(ii) assuming no intervening bankruptcy or insolvency of the
Company between the date of deposit and the 91st day
following the deposit and that no Holder is an insider of
the Company, after the 91st day following the deposit, the
trust funds will not be subject to the effect of any
applicable Bankruptcy Law.
<PAGE>SECTION 8.04. Application of Trust Money.
The Trustee or Paying Agent shall hold in trust U.S. Legal
Tender or U.S. Government Obligations deposited with it pursuant
to Article Eight, and shall apply the deposited U.S. Legal Tender
and the money from U.S. Government Obligations in accordance with
this Indenture to the payment of principal of and interest and
Liquidated Damages, if any, on the Notes. The Trustee shall be
under no obligation to invest said U.S. Legal Tender or U.S.
Government Obligations except as it may agree in writing with the
Company.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S.
Legal Tender or U.S. Government Obligations deposited pursuant to
Section 8.03 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law
is for the account of the Holders of the outstanding Notes.
Anything in this Article Eight to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company
from time to time upon the Company's request any U.S. Legal
Tender or U.S. Government Obligations held by it as provided in
Section 8.03 which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of
the amount thereof that would then be required to be deposited to
effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 8.05.Repayment to the Company.
Subject to the other provisions of this Article Eight, any
U.S. Legal Tender or U.S. Government Obligations deposited with
the Trustee, the Paying Agent or another trustee for payment of
the principal of, premium and Liquidated Damages, if any, or
interest on any Note and remaining unclaimed for two years after
such principal, premium and Liquidated Damages, if any, or
interest has become due and payable, shall be promptly paid to
the Company upon its written request and the Trustee and the
Paying Agent thereupon shall be relieved from all liability with
respect to such funds; provided that the Trustee or such Paying
Agent, before being required to make any payment, may at the
expense of the Company cause to be published once in a newspaper
of general circulation in The City of New York or mail to each
Holder entitled to such money notice that such money remains
unclaimed and that after a date specified therein which shall be
at least 30 days from the date of such publication or mailing any
unclaimed balance of such funds then remaining will be repaid to
the Company. After payment to the Company Noteholders entitled
to such funds must look to the Company for payment as general
creditors unless an applicable law designates another Person.
SECTION 8.06.Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S.
Legal Tender or U.S. Government Obligations in accordance with
this Article Eight by reason of any legal proceeding or by reason
of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application,
the Obligors' obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred
<PAGE>pursuant to Article Eight until such time as the Trustee or
Paying Agent is permitted to apply all such U.S. Legal Tender or
U.S. Government Obligations in accordance with Article Eight;
provided that if the Company has made any payment of interest on
or principal of any Notes because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the
Holders of such Notes to receive such payment from the U.S. Legal
Tender or U.S. Government Obligations held by the Trustee or
Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01.Without Consent of Holders.
The Obligors, when authorized by Board Resolutions, and the
Trustee, together, may amend or supplement this Indenture or the
Notes without notice to or consent of any Noteholder:
(1) to cure any ambiguity, defect or inconsistency;
provided that such amendment or supplement does not, in the
opinion of the Trustee, adversely affect the rights of any
Holder in any material respect;
(2) to provide for uncertificated Notes in addition to
or in place of certificated Notes;
(3) to comply with any requirements of the SEC in
order to effect or maintain the qualification of this
Indenture under the TIA;
(4) to make any change that would provide any
additional benefit or rights to the Noteholders or that does
not adversely affect the rights of any Noteholder;
(5) to provide for issuance of the Exchange Notes,
which will have terms substantially identical in all
material respects to the Initial Notes (except that the
transfer restrictions and the reference to the Registration
Rights Agreement with respect to Liquidated Damages and
registration rights contained in the Initial Notes will be
modified or eliminated, as appropriate), and which will be
treated together with any outstanding Initial Notes, as a
single issue of securities;
(6) to provide for the assumption of the Company's or
any Guarantor's obligations to Noteholders by a successor
company or guarantor;
(7) to release any Subsidiary Guarantee in accordance
with the provisions of this Indenture;
(8) to provide for additional Guarantors; or
(9) to make any other change that does not, in the
opinion of the Trustee, adversely affect the rights of any
Noteholders hereunder;
<PAGE>provided that the Company has delivered to the Trustee, in
addition to the documents required by Section 12.04, an Opinion
of Counsel stating that such amendment or supplement complies
with the provisions of this Section 9.01.
Upon the request of the Company accompanied by a resolution
of its Board of Directors authorizing the execution of any such
amended or supplemental Indenture, and upon receipt by the
Trustee of the documents described in Section 7.02(b), if any,
the Trustee shall join with the Obligors in the execution of any
amended or supplemental Indenture authorized or permitted by the
terms of this Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but
the Trustee shall not be obligated to enter into such amended or
supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
SECTION 9.02.With Consent of Holders.
(a) Subject to Section 6.06 and the exceptions noted below,
the Obligors, when authorized by Board Resolutions, and the
Trustee, together, with the written consent of the Holder or
Holders of at least a majority in aggregate principal amount of
then outstanding Notes, may amend or supplement this Indenture or
the Notes, without notice to any other Noteholders. Subject to
Section 6.06 and the exceptions noted below, the Holder or
Holders of a majority in aggregate principal amount of then
outstanding Notes may waive compliance by the Company with any
provision of this Indenture or the Notes without notice to any
other Noteholder. No amendment, supplement or waiver, including
a waiver pursuant to Section 6.04, shall, without the consent of
each Holder of each Note affected thereby:
(i) reduce the principal amount of Notes the Holders
of which must consent to any such amendment, supplement or
waiver;
(ii) reduce the rate or extend the time for payment of
interest on or Liquidated Damages, if any, with respect to
any Note;
(iii) reduce the principal of or extend the fixed
maturity of any Note;
(iv) reduce the price payable upon the redemption of
any Note or change the time at which any Note may or shall
be redeemed;
(v) reduce the price payable upon the repurchase of
any Note upon a Change of Control, upon an Excess Proceeds
Offer or License Loss Offer or change the time at which any
Note shall be repurchased;
(vi) waive a Default or Event of Default in the payment
of principal of, or premium, interest or Liquidated Damages
(if any) on, the Notes (except a rescission of acceleration
of the Notes by the Holders of at least a majority in
aggregate principal amount of the Notes and a waiver of the
payment default that resulted from such acceleration);
(vii) make any Note payable in money other than
that stated in the Note;
<PAGE>(viii) make any change in the provisions
concerning waiver of Defaults or Events of Default by
Holders of the Notes or rights of Holders to receive payment
of principal, interest or Liquidated Damages, if any;
(ix) make any change in the subordination provisions
herein that affects the right of any Holder; or
(x) release the Company or any Guarantor from its
obligations under the Notes or the Subsidiary Guarantee
(except pursuant to Section 4.19 or 11.02).
(b) It shall not be necessary for the consent of the
Holders under this Section 9.02 to approve the particular form of
any proposed amendment, supplement or waiver, but it shall be
sufficient if such consent approves the substance thereof.
(c) After an amendment, supplement or waiver under this
Section 9.02 becomes effective, the Company shall mail to the
Holders affected thereby a notice briefly describing the
amendment, supplement or waiver. Any failure of the Company to
mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental
indenture.
SECTION 9.03.Effect on Senior Indebtedness.
No amendment of this Indenture shall adversely affect the
rights of any holder of Senior Indebtedness under Article Ten of
this Indenture, without the consent of such holder.
SECTION 9.04.Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or
the Notes shall comply with the TIA as then in effect.
SECTION 9.05.Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective,
a consent to it by a Holder is a continuing consent by the Holder
and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the consenting Holder's Note, even if
notation of the consent is not made on any Note. Subject to the
following paragraph, any such Holder or subsequent Holder may
revoke the consent as to such Holder's Note or portion of such
Note by notice to the Trustee or the Company received before the
date on which the Trustee receives an Officers' Certificate
certifying that the Holders of the requisite principal amount of
Notes have consented (and not theretofore revoked such consent)
to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to
consent to any amendment, supplement or waiver, which record date
shall be at least 30 days prior to the first solicitation of such
consent. If a record date is fixed, then notwithstanding the
last sentence of the immediately preceding paragraph, those
Persons who were Holders at such record date (or their duly
designated proxies), and only those Persons, shall be entitled to
revoke any consent previously given, whether or not such Persons
<PAGE>continue to be Holders after such record date. No such
consent shall be valid or effective for more than 90 days after
such record date.
After an amendment, supplement or waiver becomes effective,
it shall bind every Noteholder, unless it makes a change
described in any of clauses (i) through (x) of Section 9.02(a),
in which case, the amendment, supplement or waiver shall bind
only each Holder of a Note who has consented to it and every
subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note; provided that any
such waiver shall not impair or affect the right of any Holder to
receive payment of principal of and interest on a Note, on or
after the respective due dates expressed in such Note, or to
bring suit for the enforcement of any such payment on or after
such respective dates without the consent of such Holder.
SECTION 9.06.Notation on or Exchange of Notes.
If an amendment, supplement or waiver changes the terms of a
Note, the Trustee may require the Holder of the Note to deliver
it to the Trustee. The Trustee may place an appropriate notation
on the Note about the changed terms and return it to the Holder.
Alternatively, if the Company or the Trustee so determines, the
Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms.
Any such notation or exchange shall be made at the sole cost and
expense of the Company.
SECTION 9.07.Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or
waiver authorized pursuant to this Article Nine; provided that
the Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own
rights, duties or immunities under this Indenture. The Trustee
shall be entitled to receive, and shall be fully protected in
relying upon, in addition to the documents required by Section
12.04, an Opinion of Counsel and an Officers' Certificate each
stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or
permitted by this Indenture. Such Opinion of Counsel shall not
be an expense of the Trustee.
ARTICLE TEN
SUBORDINATION
SECTION 10.01. Agreement to Subordinate.
The Company, each Guarantor and the Trustee agree, and each
Holder by its acceptance thereof likewise acknowledges and
agrees, that all Notes, Subsidiary Guarantees and the
Registration Rights Agreement shall be issued subject to this
Article Ten; and each Person holding any Note or entitled to the
benefit of any Subsidiary Guarantee, whether upon original issue
or upon transfer, assignment or exchange thereof accepts and
agrees that the payment of principal of, premium, if any, and
interest on the Notes and the Subsidiary Guarantees and
Liquidated Damages, if any, will be subordinated to the prior
payment in full of all Obligations with respect
<PAGE>to Senior Indebtedness of the Company and any Guarantor
(whether outstanding on the date of this Indenture or thereafter
incurred), to the extent set forth in this Article Ten.
SECTION 10.02. Payment to Noteholders.
(a) In the event that (i) any Designated Senior
Indebtedness is not paid when due or (ii) any other default on
Designated Senior Indebtedness occurs and the maturity of such
Designated Senior Indebtedness is accelerated in accordance with
its terms, no Obligor may pay the principal of or interest on the
Notes or make any deposit for the purpose of the discharge of its
liabilities under the Indenture or may repurchase, redeem or
otherwise retire any Notes or make any payment under any
Subsidiary Guarantee or may pay any Liquidated Damages
(collectively, "pay the Notes"; "payment of the Notes" shall have
a correlative meaning), except in Permitted Junior Securities,
unless, in either case, (a) the default has been cured or waived
and any such acceleration has been rescinded or (b) such
Designated Senior Indebtedness has been paid in full.
(b) During the continuance of any default (other than
a default described in clause (i) or (ii) of Section 10.02(a), a
"Non-Payment Default") with respect to any Designated Senior
Indebtedness as a result of which the maturity thereof may then
be accelerated immediately without further notice (except such
notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods, no Obligor may pay
the Notes, except in Permitted Junior Securities, for a period (a
"Payment Blockage Period") commencing upon the receipt by any
Obligor and the Trustee of written notice of such default from
the Representative of any Designated Senior Indebtedness
specifying an election to effect a Payment Blockage Period (a
"Blockage Notice") and ending 179 days thereafter (or earlier if
such Payment Blockage Period is terminated (i) by written notice
to the Trustee and the Company from the Person or Persons who
gave such Blockage Notice, (ii) by repayment in full of such
Designated Senior Indebtedness or (iii) because the default
giving rise to such Blockage Notice is no longer continuing or is
waived). Notwithstanding the immediately preceding sentence (but
subject to the next preceding sentence), unless the holders of
such Designated Senior Indebtedness or the Representative of such
holders shall have accelerated the maturity of such Designated
Senior Indebtedness, the Obligors may resume payments on the
Notes after such Payment Blockage Period. Not more than one
Blockage Notice may be given in any consecutive 360-day period,
irrespective of the number of defaults with respect to Designated
Senior Indebtedness during such period. No Non-Payment Default
that existed or was continuing on the date of delivery of any
Payment Blockage Notice to the Trustee shall be, or be made, the
basis for a subsequent Blockage Notice.
(c) Upon any payment or distribution of the assets of
any Obligor to creditors upon a total or partial liquidation or a
total or partial dissolution of any Obligor or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding
relating to any Obligor or its property or an assignment for the
benefit of creditors or any marshaling of any Obligor's assets
and liabilities: (i) holders of Senior Indebtedness shall be
entitled to receive payment in full of all Obligations due in
respect of the Senior Indebtedness before Noteholders shall be
entitled to receive any payment of the Notes; and (ii) until the
Senior Indebtedness is paid in full, any distribution to which
Noteholders would be entitled but for this provision shall be
made to holders
<PAGE>of the Senior Indebtedness as their interests may appear,
except that Noteholders may receive Permitted Junior Securities.
(d) Section 10.02(a), (b) and (c) shall not prevent or
delay (i) the Company from redeeming any Notes if required by any
Gaming Authority as set forth in Section 3.08 or from otherwise
purchasing any Notes pursuant to any Legal Requirement relating
to the gaming business of the Company and its Subsidiaries or
(ii) the receipt by the Noteholders of payments of principal and
interest on the Notes, as set forth in Article Eight, from the
application of any money or U.S. Government Obligations held in
trust by the Trustee.
(e) If payment of the Notes is accelerated because of
a Default or Event of Default, the Company shall promptly notify
each Representative of holders of Designated Senior Indebtedness.
(f) In the event that, notwithstanding subsection (a),
(b) or (c) of this Section 10.02, any payment or distribution of
assets of any Obligor of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be
received by the Trustee under this Indenture or the Holders
before all Senior Indebtedness is paid in full or provision is
made for such payment in accordance with its terms, such payment
or distribution shall be held in trust for the benefit of and
shall be paid over or delivered to the holders of such Senior
Indebtedness or their respective Representatives, or to the
trustee or trustees under any indenture pursuant to which any
instruments evidencing any of such Senior Indebtedness may have
been issued, as their respective interests may appear, for
application to the payment of all Senior Indebtedness remaining
unpaid until all such Senior Indebtedness shall have been paid in
full in accordance with its terms, after giving effect to any
concurrent payment or distribution to or for the holders of such
Senior Indebtedness.
(g) The consolidation of the Company or any Guarantor
with, or the merger of the Company or any Guarantor into, another
corporation or the liquidation or dissolution of the Company or
any Guarantor following the conveyance or transfer of its
property as an entirety, or substantially as an entirety, to
another corporation upon the terms and conditions provided in
Article Five shall not be deemed a dissolution, winding up,
liquidation or reorganization for the purposes of this Section
10.02 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the
conditions stated in Article Five. Nothing in this Section shall
apply to claims of, or payments to, the Trustee under or pursuant
to Article Seven, except as provided therein. This Section shall
be subject to Section 10.05.
SECTION 10.03. Subrogation of Notes.
(a) Subject to the payment in full of all Senior
Indebtedness, Holders shall be subrogated to the rights of the
holders of Senior Indebtedness to receive payments or
distributions of cash, property or securities of the Company or
any Guarantor applicable to the Senior Indebtedness until the
principal of and interest on the Notes shall be paid in full;
and, for the purposes of such subrogation, no payments or
distributions to the holders of such Senior Indebtedness of any
cash, property or securities to which the Holders or any
Guarantor or the Trustee on their behalf would be entitled except
for this Article Ten, and no payment over pursuant to this
Article Ten to the holders of such Senior Indebtedness by Holders
or the Trustee on their behalf shall, as between the Company or
any Guarantor, as the case may be, its creditors other than
holders of Senior Indebtedness and the Holders, be deemed to be a
payment by the Company or such Guarantor to or on account of such
Senior Indebtedness; and no payments or distributions of cash,
property or securities to or for the benefit of the
Securityholders pursuant to the subrogation provision of this
Article Ten, which would otherwise have been paid to the holders
of Senior Indebtedness shall be deemed to be a payment by the
Company or any Guarantor to or for the account of the Notes. It
is understood that this Article Ten is and is intended solely for
the purpose of defining the relative rights of the Holders, on
the one hand, and the holders of the Senior Indebtedness, on the
other hand.
(b) Nothing contained in this Article Ten or elsewhere
in this Indenture or in the Notes is intended to or shall impair,
as between the Company or a Guarantor, on the one hand, and their
creditors (other than the holders of Senior Indebtedness), and
the Holders, the obligation of the Company or such Guarantors,
which is absolute and unconditional, on the other, to pay to the
Holders the principal of and interest on the Notes as and when
the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of
the Holders and creditors of the Company or such Guarantors, as
the case may be, other than the holders of the Senior
Indebtedness, nor shall anything herein or therein prevent a
Holder or the Trustee on his behalf from exercising all remedies
otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article Ten
of the holders of Senior Indebtedness in respect of cash,
property or securities of the Company or any Guarantor received
upon the exercise of any such remedy.
(c) Upon any payment or distribution of assets of any
Obligor referred to in this Article Ten, the Trustee, subject to
Sections 7.01 and 7.02, and the Holders shall be entitled to rely
upon any order or decree made by any court of competent
jurisdiction in which such bankruptcy, dissolution, winding up,
liquidation, arrangement or reorganization proceedings are
pending, or a certificate of the receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders, for the
purpose of ascertaining the Persons entitled to participate in
such distribution, the holders of the Senior Indebtedness and
other indebtedness of such Obligor, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and
all other facts pertinent thereto or to this Article Ten.
SECTION 10.04. Authorization by Securityholders.
Each Holder by his acceptance thereof authorizes the Trustee
in his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this
Article Ten and appoints the Trustee his attorney in fact for any
and all such purposes.
SECTION 10.05. Notice to Trustee.
(a) The Company and each Guarantor, as the case may be,
shall give prompt written notice to the Trustee and to any Paying
Agent of any fact known to the Company or such Guarantor which
would prohibit the making of any payment of moneys to or by the
Trustee or
<PAGE>any Paying Agent in respect of the Notes pursuant to this
Article Ten. Regardless of anything to the contrary contained in
this Article Ten or elsewhere in this Indenture, the Trustee
shall not be charged with knowledge of the existence of any
Senior Indebtedness or of any default or event of default with
respect to any Senior Indebtedness or of any other facts which
would prohibit the making of any payment of moneys to or by the
Trustee, unless and until the Trustee shall have received notice
in writing at its Corporate Trust Office to that effect signed by
an officer of the Company or Guarantor, as the case may be, or by
a holder of Senior Indebtedness or Representative, who shall have
been certified by the Company or such Guarantor, or otherwise
established to the reasonable satisfaction of the Trustee to be
such holder or Representative, and, prior to the receipt of any
such written notice, the Trustee shall, subject to Sections 7.01
and 7.02, be entitled to assume that no such facts exist;
provided that if on a date at least three Business Days prior to
the date upon which by the terms hereof any such moneys shall
become payable for any purpose (including, without limitation,
the payment of the principal of, or interest on any Note) the
Trustee shall not have received with respect to such moneys the
notice provided for in this Section, then, regardless of anything
herein to the contrary, the Trustee shall have full power and
authority to receive such moneys and to apply the same to the
purpose for which they were received, and shall not be affected
by any notice to the contrary which may be received by it on or
after such prior date.
(b) Notwithstanding anything to the contrary herein,
nothing shall prevent (a) any payment by the Company or any
Guarantor or the Trustee to the Noteholders of amounts in
connection with a redemption of Notes if (i) notice of such
redemption has been given pursuant to Article Three prior to the
receipt by the Trustee of written notice as aforesaid, and
(ii) such notice of redemption is given not earlier than 60 days
before the redemption date, or (b) any payment by the Trustee to
the Noteholders of amounts deposited with it pursuant to Article
Eight.
(c) The Trustee shall be entitled to rely on the delivery
to it of a written notice by a Person representing himself to be
a holder of Senior Indebtedness (or a Representative) to
establish that such notice has been given by a holder of Senior
Indebtedness or a Representative on behalf of such holder. In
the event that the Trustee determines in good faith that further
evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article Ten, the Trustee may
request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such Person
is entitled to participate in such payment or distribution and
any other facts pertinent to the rights of such Person under this
Article Ten, and, if such evidence is not furnished the Trustee,
may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such
payment.
SECTION 10.06. Trustee's Relation to Senior Debt
Holders.
(a) The Trustee, or any agent of the Company, or a
Guarantor or the Trustee shall be entitled to all the rights set
forth in this Article Ten with respect to any Senior Indebtedness
which may at any time be held by it in its individual or any
other capacity to the same extent as any other holder of Senior
Indebtedness and nothing in this Indenture shall deprive the
Trustee or any such agent, of any of its rights as such holder.
Nothing in this Article Ten shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 7.07.
<PAGE>(b) With respect to the holders of Senior
Indebtedness, the Trustee undertakes to perform or to observe
only such of its covenants and obligations as are specifically
set forth in this Article Ten, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness of
the Company or any Guarantor shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness and the
Trustee shall not be liable to any holder of Senior Indebtedness
if it shall pay over or deliver to Holders, the Company, any
Guarantor any other Person moneys or assets to which any holder
of Senior Indebtedness shall be entitled by virtue of this
Article Ten or otherwise.
SECTION 10.07. No Impairment of Subordination.
No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at
any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or any Guarantor or by
any act or failure to act, in good faith, by any such holder, or
by any noncompliance by the Company or such Guarantor with the
terms, provisions and covenants of this Indenture, regardless of
any knowledge thereof which any such holder may have or otherwise
be charged with.
ARTICLE ELEVEN
SUBSIDIARY GUARANTEES
SECTION 11.01. Subsidiary Guarantees.
(a) Each Guarantor hereby jointly and severally
unconditionally guarantees (each such guarantee together with the
guarantee endorsement to the Notes by such Guarantor,
substantially in the form of Exhibit F hereto, being a
"Subsidiary Guarantee") to each Holder authenticated and
delivered by the Trustee irrespective of the validity or
enforceability of this Indenture, the Notes or the Obligations of
the Company under this Indenture or the Notes, that: (i) the
principal of, interest, premium, if any, and Liquidated Damages,
if any, on the Notes will be paid in full when due, whether at
the Maturity Date, any Interest Payment Date, any Redemption Date
or Purchase Date, by acceleration, call for redemption, offer to
purchase or otherwise, and interest on the overdue principal of
and interest and Liquidated Damages, if any, on the Notes and all
other Obligations of the Company to the Holders or the Trustee
under this Indenture or the Notes will be promptly paid in full
or performed, all in accordance with the terms of this Indenture
and the Notes; and (ii) in case of any extension of time of
payment or renewal of any Notes or any of such other Obligations,
they will be paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at maturity,
by acceleration or otherwise. Failing payment when due
(including any applicable grace periods) of any amount so
guaranteed for whatever reason, each Guarantor will be obligated
to pay the same pursuant to the preceding sentence whether or not
such failure to pay has become an Event of Default that could
cause acceleration pursuant to Section 6.02. Each Guarantor
agrees that this is a guarantee of payment and not a guarantee of
collection.
<PAGE>(b) For purposes of this Article Eleven, "Obligations"
means, with respect to the Company, any and all present and
future obligations and liabilities of the Company of every type
and description to the Holders under the Notes, this Indenture
and the Registration Rights Agreement, whether for principal,
premium (if any), interest, Liquidated Damages, if any, expenses,
indemnities or other amounts, in each case whether due or not
due, absolute or contingent, liquidated or unliquidated,
determined or undetermined, now or hereafter existing, renewed or
restructured, whether or not from time to time decreased or
extinguished and later increased, created or incurred, whether or
not arising after the commencement of a proceeding under any
Bankruptcy Law (including post-petition interest) and whether or
not allowed or allowable as a claim in any such proceeding.
(c) Each Guarantor's Obligations with regard to this
Subsidiary Guarantee shall be (i) joint and several,
unconditional, irrespective of the validity or enforceability of
the Notes or the Obligations of the Company under this Indenture
or the Notes, the absence of any action to enforce the same, the
recovery of any judgment against the Company or any other Obligor
with respect to this Indenture, the Notes or the Obligations of
the Company under this Indenture or the Notes, any action to
enforce the same or any other circumstances (other than complete
performance) which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor and
(ii) subordinated to the prior payment in full of all Obligations
with respect to Senior Indebtedness of such Guarantor (whether
outstanding on the date of this Indenture or thereafter
incurred) in accordance with Article Ten.
(d) Each Guarantor, to the extent permitted by law, hereby
waives and relinquishes all claims, rights and remedies accorded
by applicable law to guarantors and agrees not to assert or take
advantage of any such claims, rights or remedies, including but
not limited to: (i) any right to require the Trustee or the
Holders (each, a "Benefited Party") to proceed against the
Company, any other Obligor or any other Person or to proceed
against or exhaust any security held by a Benefited Party at any
time or to pursue any other remedy in any Benefited Party's power
before proceeding against such Guarantor; (ii) any defense that
may arise by reason of the incapacity, lack of authority, death
or disability of any other Person or the failure of a Benefited
Party to file or enforce a claim against the estate (in
administration, bankruptcy or any other proceeding) of any other
Person; (iii) demand, protest and notice of any kind including
but not limited to notice of the existence, creation or incurring
of any new or additional Indebtedness or obligation or of any
action or non-action on the part of such Guarantor, the Company,
any other Obligor, any Benefited Party, any creditor of such
Guarantor, the Company, any other Obligor or on the part of any
other Person whomsoever in connection with any Indebtedness or
Obligations hereby guaranteed; (iv) any defense based upon an
election of remedies by a Benefited Party, including but not
limited to an election to proceed against such Guarantor for
reimbursement; (v) any defense based upon any statute or rule or
law which provides that the obligation of a surety must be
neither larger in amount nor in other respects more burdensome
than that of the principal; (vi) any defense arising because of a
Benefited Party's election, in any proceeding instituted under
the Bankruptcy Law or the application of Section 1111(b)(2) of
the Bankruptcy Law; or (vii) any defense based on any borrowing
or grant of a security interest under Section 364 of the
Bankruptcy Law. Except as provided in Section 11.02, a
Subsidiary Guarantee will not be discharged except by discharge
of this Indenture pursuant to Article Eight hereof or by complete
performance of the Obligations contained in such Subsidiary
Guarantee and this Indenture.
<PAGE>(e) If any Holder or the Trustee is required by any
court or otherwise to return to either the Company or any
Guarantor, or any custodian acting in relation to either the
Company or such Guarantor, any amount paid by the Company or such
Guarantor to the Trustee or such Holder, the applicable
Subsidiary Guarantee, to the extent theretofore discharged, shall
be reinstated in full force and effect. No Guarantor shall be
entitled to any right of subrogation in relation to the Holders
in respect of any Obligations guaranteed until payment in full of
all Obligations guaranteed pursuant to such Subsidiary Guarantee.
(f) As between each Guarantor, on the one hand, and the
Holders and the Trustee, on the other, (i) the maturity of the
Obligations guaranteed pursuant to a Subsidiary Guarantee may be
accelerated pursuant to Section 6.02, notwithstanding any stay,
injunction or other prohibition preventing such acceleration as
to the Company or any other Obligor on the Notes of the
Obligations guaranteed hereby, and (ii) in the event of any
declaration of acceleration of those Obligations as provided in
Section 6.02, those Obligations (whether or not due and
payable) will forthwith become due and payable by such Guarantor
for the purpose of the Subsidiary Guarantee.
SECTION 11.02. Release Following Disposition of
Capital Stock or Designation as an
Unrestricted Subsidiary.
The Trustee shall release any Guarantor from its Subsidiary
Guarantee, and such Subsidiary Guarantee shall cease to be valid
and to have any force and effect if (i) there shall occur a sale
or other disposition (other than to the Company or any Restricted
Subsidiary) of all of the assets of any Guarantor, by way of
merger, consolidation or otherwise, or a sale or other
disposition (other than to the Company or any Restricted
Subsidiary) of all of the Capital Stock of any Guarantor;
provided that such sale or other disposition is an Asset
Disposition subject to and complying with Section 4.15, and the
Net Available Cash resulting therefrom are applied in accordance
with such Section 4.15, or (ii) such Restricted Subsidiary is
designated as an Unrestricted Subsidiary in accordance with
Section 4.19. In such event, each of the Company, the Trustee
and the remaining Guarantors shall, in accordance with Article
Nine hereof, execute an Indenture Supplemental hereto that
reflects the release of such Subsidiary Guarantee. Any Guarantor
not released from its obligations under its Subsidiary Guarantee
shall remain liable for the full amount of principal and interest
on the Notes and for the other Obligations of the Company as
provided in this Article Eleven.
SECTION 11.03. Rights of Contribution.
(a) In order to provide for just and equitable contribution
among the Guarantors in connection with their respective
Subsidiary Guarantees, the Guarantors have agreed among
themselves that if any Guarantor satisfies some or all of the
Obligations of the Company guaranteed by it hereunder (a "Funding
Guarantor"), the Funding Guarantor shall be entitled to
contribution from the other Guarantors that have positive Maximum
Net Worth (as defined below) for all payments made by the Funding
Guarantor in satisfying such Obligations, so that each Guarantor
that remains obligated under its Subsidiary Guarantee at the time
that a Funding Guarantor makes such payment (a "Remaining
Guarantor") and has a positive Maximum Net Worth shall bear a
portion of such payment equal to the percentage that such
Remaining
<PAGE>Guarantor's Maximum Net Worth bears to the aggregate
Maximum Net Worth of all Remaining Guarantors that have positive
Maximum Net Worth.
(b) For purposes of this Section 11.03, the following terms
are defined as set forth below:
"Net Worth" means, with respect to any Guarantor, the
amount, as of any date of calculation, by which the sum of such
Person's assets (including subrogation, indemnity, contribution,
reimbursement and similar rights that such Guarantor may have),
determined on the basis of a "fair valuation" or their "fair
salable value" (whichever is the applicable test under
Section 548 and other relevant provisions of Bankruptcy Law, and
the relevant state fraudulent conveyance or transfer laws) is
greater than the amount that will be required to pay all of such
Person's debts, in each case matured or unmatured, contingent or
otherwise, as of the date of calculation, but excluding
liabilities arising under its Subsidiary Guarantee and excluding,
to the maximum extent permitted by applicable law with the
objective of avoiding rendering such Person insolvent,
liabilities subordinated to the Obligations under such Subsidiary
Guarantees arising out of loans or advances made to such Person
by any other Person.
"Maximum Net Worth" means, with respect to any Guarantor,
the greatest of the Net Worths calculated as of the following
dates: (A) the date on which the Guarantor becomes a Guarantor
hereunder, (B) the date on which such Guarantor expressly
reaffirms its Subsidiary Guarantee, (C) the date on which demand
for payment is made on such Guarantor hereunder, (D) the date on
which payment is made by such Guarantor hereunder or (E) the date
on which any judgment, order or decree is entered requiring such
Guarantor to make payment hereunder or in respect hereof.
The meaning of the terms "fair valuation" and "fair salable
value" and the calculation of assets and liabilities shall be
determined and made in accordance with the relevant provisions of
any Bankruptcy Law and applicable state fraudulent conveyance or
transfer laws.
SECTION 11.04. Limitation on Liability.
If the obligations of any Guarantor hereunder otherwise
would be subject to avoidance under Section 548 of the Bankruptcy
Law or any applicable state law relating to fraudulent
conveyances or fraudulent transfers, taking into consideration
such Guarantor's (i) rights of reimbursement and indemnity from
the Company with respect to amounts paid by such Guarantor and
(ii) rights of contribution from other Guarantors pursuant to
Section 11.03, then such obligations hereby are reduced to the
largest amount that would make them not subject to such
avoidance. Any Person asserting that such Guarantor's
obligations are so avoidable shall have the burden (including the
burden of production and of persuasion) of proving (a) that,
without giving effect to this paragraph, such Guarantor's
obligations hereunder would be avoidable and (b) the extent to
which such obligations are reduced by operation of this
paragraph.
<PAGE>ARTICLE TWELVE
MISCELLANEOUS
SECTION 12.01. TIA Controls.
If any provision of this Indenture limits, qualifies, or
conflicts with another provision which is required to be included
in this Indenture by the TIA, the required provision shall
control.
SECTION 12.02. Notices.
Any notices or other communications required or permitted
hereunder shall be in writing, and shall be sufficiently given if
made by hand delivery, by telecopier or registered or certified
mail, postage prepaid, return receipt requested, addressed as
follows:
if to the Company or any Guarantor:
Ameristar Casinos, Inc.
3773 Howard Hughes Parkway
Suite 490 South
Las Vegas, Nevada 89109
Attention: Senior Vice President and Chief
Financial Officer
Telecopy: (702) 369-8860
if to the Trustee:
First Trust National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attention: Corporate Trust Administration
Telecopy: (612) 244-0711
Each of the Company and the Trustee by written notice to
each other such Person may designate additional or different
addresses for notices to such Person. Any notice or
communication to the Company or the Trustee shall be deemed to
have been given or made as of the date so delivered if personally
delivered; when receipt is acknowledged, if faxed; and five
calendar days after mailing if sent by registered or certified
mail, postage prepaid (except that a notice of change of address
shall not be deemed to have been given until actually received by
the addressee).
Any notice or communication mailed to a Noteholder shall be
mailed to him by first class mail or other equivalent means at
his address as it appears on the registration books of the
Registrar and shall be sufficiently given to him if so mailed
within the time prescribed.
Failure to mail a notice or communication to a Noteholder or
any defect in it shall not affect its sufficiency with respect to
other Noteholders. If a notice or communication is mailed in the
manner provided above, it is duly given, whether or not the
addressee receives it.
<PAGE>SECTION 12.03. Communications by Holders with
Other Holders.
Noteholders may communicate pursuant to TIA Section 312(b) with
other Noteholders with respect to their rights under this
Indenture or the Notes. The Company, the Trustee, the Registrar
and any other Person shall have the protection of TIA Section 312(c).
SECTION 12.04. Certificate and Opinion as to
Conditions Precedent.
Upon any request or application by the Company to the
Trustee to take any action under this Indenture, the Company
shall furnish to the Trustee:
(1) an Officers' Certificate, in form and substance
satisfactory to the Trustee, stating that, in the opinion of
the signers, all conditions precedent to be performed by the
Company, if any, provided for in this Indenture relating to
the proposed action have been complied with; and
(2) an Opinion of Counsel, in form and substance
satisfactory to the Trustee, stating that, in the opinion of
such counsel, all such conditions precedent to be performed
by the Company, if any, provided for in this Indenture
relating to the proposed action have been complied with.
SECTION 12.05. Statements Required in Certificate
or Opinion.
Each certificate or opinion with respect to compliance with
a condition or covenant provided for in this Indenture, other
than the Officers' Certificate required by Section 4.06, shall
include:
(1) a statement that the Person making such
certificate or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of such Person,
he has made such examination or investigation as is
reasonably necessary to enable him to express an informed
opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion
of each such Person, such condition or covenant has been
complied with.
SECTION 12.06. Rules by Trustee, Paying Agent,
Registrar.
The Trustee may make reasonable rules in accordance with the
Trustee's customary practices for action by or at a meeting of
Noteholders. The Paying Agent or Registrar may make reasonable
rules for its functions.
<PAGE>SECTION 12.07. Legal Holidays.
A "Legal Holiday" used with respect to a particular place of
payment is a Saturday, a Sunday or a day on which banking
institutions in New York, New York or at such place of payment
are not required to be open. If a payment date is a Legal
Holiday at such place, payment may be made at such place on the
next succeeding day that is not a Legal Holiday, and no interest
shall accrue for the intervening period.
SECTION 12.08. Governing Law.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF
NEW YORK. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE.
SECTION 12.09. No Adverse Interpretation of Other
Agreements.
This Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or any of its
Subsidiaries. Any such indenture, loan or debt agreement may not
be used to interpret this Indenture.
SECTION 12.10. No Recourse Against Others.
A director, officer, employee, stockholder or incorporator,
as such, of any Obligor or of the Trustee shall not have any
liability for any obligations of any Obligor under the Notes or
this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creations. Each Noteholder
by accepting a Note waives and releases all such liability. Such
waiver and release are part of the consideration for the issuance
of the Notes.
SECTION 12.11. Successors.
All agreements of the Obligors in this Indenture and the
Notes shall bind their respective successors. All agreements of
the Trustee in this Indenture shall bind its successors.
SECTION 12.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together
shall represent the same agreement.
SECTION 12.13. Severability.
In case any one or more of the provisions in this Indenture
or in the Notes shall be held invalid, illegal or unenforceable,
in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and
of the remaining provisions shall
<PAGE>not in any way be affected or impaired thereby, it being
intended that all of the provisions hereof shall be enforceable
to the full extent permitted by law.
SECTION 12.14. Designation of Notes as Senior
Indebtedness Under Gem Notes.
The Company hereby designates, with respect to each Gem
Note, all Indebtedness evidenced by the Notes and this Indenture,
including, without limitation, all Liquidated Damages, if any, as
Senior Indebtedness, as such term is defined in such Gem Note.
SECTION 12.15Liability of ACCBI.
Notwithstanding anything herein to the contrary, ACCBI shall
have no obligation or liability hereunder prior to the time, if
at all, that this Indenture, and the Subsidiary Guarantee of
ACCBI provided for herein, shall have been approved by the Iowa
Racing and Gaming Commission.
<PAGE>IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed, all as of the date first
written above.
Company:
AMERISTAR CASINOS, INC., a Nevada
corporation
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Senior Vice President
Guarantors:
AMERISTAR CASINO COUNCIL BLUFFS,
INC., an Iowa corporation
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
AMERISTAR CASINO LAS VEGAS, INC., a
Nevada corporation
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
AMERISTAR CASINO VICKSBURG, INC., a
Mississippi corporation
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
A.C. FOOD SERVICES, INC., a Nevada
corporation
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
AC HOTEL CORP., a Mississippi
corporation
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
Trustee:
FIRST TRUST NATIONAL ASSOCIATION
as Trustee
By: /s/ Richard H. Prokosch
Name: Richard H. Prokosch
Title: Trust Officer
EXHIBIT A
FORM OF NOTE
AMERISTAR CASINOS, INC.
No. _____________________ $_______________
CUSIP No. ______________
10 1/2% SENIOR SUBORDINATED NOTES DUE 2004 [SERIES A] [SERIES B]1
AMERISTAR CASINOS, Inc., a Nevada corporation (the
"Company"), for value received, hereby promises to pay to
__________, or its registered assigns, the principal sum of
________ Dollars [as reduced or increased from time to time as
indicated on Schedule A hereto],2 on August 1, 2004.
Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at
this place.
Unless the certificate of authentication hereon has been
duly executed by the Trustee (as defined on the reverse hereof)
referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture (as
defined on the reverse hereof) or be valid or obligatory for any
purposes.
IN WITNESS WHEREOF, the Company has caused this Note to be
duly executed under its corporate seal.
AMERISTAR CASINOS, INC.
By:
Name:
Title:
[Corporate Seal]
Attest:
By:
Name:
Title:
Dated:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee, certifies that this is one of
the Notes referred to in the Indenture.
By:
Authorized Signatory
FORM OF REVERSE SIDE OF NOTE
AMERISTAR CASINOS, INC.
10 1/2% Senior Subordinated NOTES DUE 2004 [SERIES A] [SERIES B]3
[THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE NOTE EVIDENCED HEREBY MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE
OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE NOTE EVIDENCED HEREBY
IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A OR REGULATION S
THEREUNDER. THE HOLDER OF THE NOTE EVIDENCED HEREBY
AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH NOTE
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
(1)(a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A
PERSON THAT IS NOT A U.S. PERSON (AS DEFINED IN RULE
902 UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT,
OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (IN THE
CASE OF (b), (c) OR (d), UPON DELIVERY OF AN OPINION OF
COUNSEL IF THE ISSUER OR TRUSTEE, REGISTRAR OR TRANSFER
AGENT FOR THE NOTES SO REQUESTS), (2) TO THE ISSUER,
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR
ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY
ANY PURCHASER FROM IT OF THE NOTE EVIDENCED HEREBY OF
THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.]4
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY
NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY
TO A NOMINEE OF THE DEPOSITARY, OR BY ANY SUCH NOMINEE
OF THE DEPOSITARY, OR BY THE DEPOSITARY OR NOMINEE OF
SUCH SUCCESSOR DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF
CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION
2.17 OF THE INDENTURE.]5
1. Indenture.
This Note is one of a duly authorized issue of debt
securities of the Company designated as its "10 1/2% Senior
Subordinated Notes due 2004 [Series A] [Series B]"6 (herein
called the "Notes") limited in aggregate principal amount to
$100,000,000, issued under an indenture dated as of July 15, 1997
(as amended or supplemented from time to time, the "Indenture")
between the Company, as Issuer, Ameristar Casino Council Bluffs,
Inc., an Iowa corporation, Ameristar Casino Las Vegas, Inc., a
Nevada corporation, Ameristar Casino Vicksburg, Inc., a
Mississippi corporation, A.C. Food Services, Inc., a Nevada
corporation and AC Hotel Corp., a Mississippi corporation, as
Guarantors (together with certain other current and future
subsidiaries of the Company that may become guarantors,
collectively, the "Guarantors") and First Trust National
Association, as trustee (the "Trustee," which term includes any
successor Trustee under the Indenture), to which Indenture
reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder
of the Company, the Guarantors, the Trustee and each Holder and
of the terms upon which the Notes are, and are to be,
authenticated and delivered. The summary of the terms of the
Indenture contained herein does not purport to be complete and is
qualified by reference to the Indenture. All terms used in this
Note which are not defined herein shall have the meanings
assigned to them in the Indenture.
The Indenture restricts, among other things, the Company's
ability to incur additional indebtedness, incur liens, pay
dividends or make certain other restricted payments, sell assets,
apply net proceeds from certain asset sales, enter into certain
transactions with affiliates, merge or consolidate with any other
person, sell stock of Subsidiaries or sell, assign, transfer,
lease, convey or otherwise dispose of substantially all of the
assets of the Company. The Indenture also imposes similar
restrictions on Restricted Subsidiaries, but permits, under
certain circumstances, Subsidiaries to be deemed Unrestricted
Subsidiaries and thus not be subject to the restrictions of the
Indenture.
2. Interest.
The Company shall pay interest on this Note at a rate of 10
1/2% per annum, semiannually in arrears on February 1 and
August 1 of each year, commencing on February 1, 1998, to the
Holder hereof until the principal amount hereof is paid or duly
provided for. The Record Dates for such Interest Payment Dates
shall be January 15 and July 15, respectively (each, a "Record
Date"). Interest shall accrue from July 15, 1997 or from the
most recent Interest Payment Date thereafter to which interest
has been paid or duly provided for. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment
Date will, subject to certain exceptions provided in the
Indenture, be paid to the Person in whose name this Note (or the
Note in exchange or substitution for which this Note was issued)
is registered at the close of business on the Record Date for
interest payable on such Interest Payment Date. Any such
interest not so punctually paid or duly provided for ("Defaulted
Interest") shall forthwith cease to be payable to the Holder on
such Record Date and shall be paid as provided in Section 2.12 of
the Indenture. Interest will be computed on the basis of a 360-
day year of twelve 30-day months.
Each payment of interest in respect of an Interest Payment
Date will include interest accrued through the day before such
Interest Payment Date. If an Interest Payment Date falls on a
day that is a Legal Holiday, the interest payment to be made on
such Interest Payment Date will be made on the next succeeding
business day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as
a result of such delayed payment.
[If this Note is exchanged pursuant to an Exchange Offer
Registration Statement (as defined in the Registration Rights
Agreement) prior to the Record Date for the first Interest
Payment Date following such exchange, accrued and unpaid
interest, if any, on this Note, up to but not including the date
of issuance of the Exchange Note or Exchange Notes issued in
exchange for this Note, shall be paid on the first Interest
Payment Date for such Exchange Note or Exchange Notes to the
Holder or Holders of such Exchange Note or Exchange Notes on the
first Record Date with respect to such Exchange Note or Exchange
Notes. If this Note is exchanged pursuant to an Exchange Offer
Registration Statement subsequent to the Record Date for the
first Interest Payment Date following such exchange but on or
prior to such Interest Payment Date, then any such accrued and
unpaid interest with respect to this Note and any accrued and
unpaid interest on the Exchange Note or Exchange Notes issued in
exchange for this Note, through the day before such Interest
Payment Date, shall be paid on such Interest Payment Date to the
Holder of the Initial Note on such Record Date.]7
[If this Note has been issued in exchange for an Initial
Note pursuant to an Exchange Offer Registration Statement (as
defined in the Registration Rights Agreement) prior to the Record
Date for such Initial Note with respect to the first Interest
Payment Date following such exchange, accrued and unpaid
interest, if any, on such Initial Note, up to but not including
the date of issuance of this Note, shall be paid on the first
Interest Payment Date for this Note to the Holder hereof on the
first Record Date with respect hereto. If this Note has been
issued in exchange for an Initial Note pursuant to an Exchange
Offer Registration Statement subsequent to the Record Date for
such Initial Note with respect to the first Interest Payment Date
following such exchange but on or prior to such Interest Payment
Date, then any such accrued and unpaid interest with respect to
the Initial Note and any accrued and unpaid interest on this
Note, through the day before such Interest Payment Date, shall be
paid on such Interest Payment Date to the Holder of this Note on
such Record Date.]8
To the extent lawful, the Company shall pay interest on
overdue principal, overdue premium, defaulted interest and
overdue Liquidated Damages (without regard to any applicable
grace period), at the interest rate borne on the Notes plus 2%
per annum. The Company's obligation pursuant to the previous
sentence shall apply whether such overdue amount is due at its
Stated Maturity, as a result of the Company's obligations
pursuant to the Indenture, or otherwise.
[3. Registration Rights; Liquidated Damages.
The Holder of this Note is entitled to the benefits of the
Registration Rights Agreement. Such benefits include the right
of the Holder to receive Liquidated Damages in the event of a
failure on the part of the Company to comply with certain
registration covenants, as provided in Section 4 of the
Registration Rights Agreement.]9
[4]. Method of Payment.
The Company, through the Paying Agent, shall pay interest on
this Note to the registered Holder of this Note, as provided
above. The Holder must surrender this Note to a Paying Agent to
collect principal payments. The Company will pay principal,
premium, if any, and interest and Liquidated Damages, if any, in
money of the United States of America that at the time of payment
is legal tender for payment of all debts public and private.
Principal, premium, if any, and interest and Liquidated Damages,
if any, will be payable at the office of the Paying Agent but, at
the option of the Company, interest and Liquidated Damages may be
paid by check mailed to the registered Holders at their
registered addresses; provided that all payments with respect to
Notes the Holders of which have given wire transfer instructions
to the Company will be required to be made by wire transfer of
immediately available funds to the accounts specified by the
Holders thereof. [Payments with respect to this Global Note are
required to be made in same day funds in accordance with the
policies of the Depository.]10
[5]. Paying Agent and Registrar.
Initially, the Trustee will act as Paying Agent and
Registrar under the Indenture. The Company may, upon written
notice to the Trustee, appoint and change any Paying Agent or
Registrar. The Company or any of its subsidiaries may act as
Paying Agent or Registrar.
[6]. Notice of Redemption; Selection of Notes to be
Redeemed.
At least 30 calendar days but not more than 60 days before a
Redemption Date, the Company shall mail or cause to be mailed a
notice of redemption by first class mail, postage prepaid, to
each Holder whose Notes are to be redeemed at the addresses of
such Holders as they appear in the Register.
If fewer than all the Notes are to be redeemed, selection of
Notes for redemption will be made by the Trustee, pro rata or by
lot or by any other means the Trustee determines to be fair and
appropriate and which complies with applicable legal and
securities exchange requirements.
[7]. Optional Redemption.
Except as described below, the Notes will not be redeemable
at the option of the Company prior to August 1, 2001. On or
after that date, the Notes will be redeemable at the option of
the Company, in whole at any time or in part from time to time,
on at least 30 but not more than 60 days' prior notice, mailed by
first-class mail to the Noteholders' registered addresses, at the
Redemption Prices (expressed in percentages of principal amount)
specified below plus accrued and unpaid interest and Liquidated
Damages, if any, to the applicable Redemption Date, if redeemed
during the 12-month period beginning August 1 of the years
indicated below:
Year Percentage
2001 105.25%
2002 103.50%
2003 and 101.75%
thereafter
Notwithstanding the foregoing, but subject to the terms of
any Designated Senior Indebtedness, on or prior to August 1,
2000, the Company may redeem up to 25% in aggregate principal
amount of the Notes originally issued under the Indenture at a
Redemption Price of 110.50% of the principal amount thereof plus
accrued and unpaid interest and Liquidated Damages, if any,
thereon to the Redemption Date with the net proceeds of one or
more Public Equity Offerings; provided that at least $75.0
million in aggregate principal amount of Notes remain outstanding
immediately after the occurrence of each such redemption; and
provided, further, that notice of each such redemption shall have
been given within 30 days after the date of the closing of such
Public Equity Offering.
If an Event of Default occurs prior to August 1, 2001, by
reason of any willful action (or inaction) taken (or not taken)
by or on behalf of the Company with the intention of avoiding the
prohibition on redemption of the Notes prior to August 1, 2001,
then the premium (expressed in percentages of principal amount)
specified below shall also become immediately due and payable to
the extent permitted by law upon the acceleration of the Notes
during the 12-month period beginning August 1 of the years
indicated below:
Year Percentage
1997 (and including the
period from 10.50%
July 15, 1997 to
July 31, 1997)
1998 9.188%
1999 7.875%
2000 6.563%
The Notes are not subject to any mandatory sinking fund
payments.
[8]. Effect of Notice of Redemption.
Once notice of redemption is mailed as described above,
Notes called for redemption become due and payable on the
Redemption Date and at the Redemption Price plus accrued interest
and Liquidated Damages, if any. Upon surrender to the Trustee or
Paying Agent, such Notes called for redemption shall be paid at
the Redemption Price (together with accrued interest, and
Liquidated Damages, if any, thereon to the Redemption Date), but
installments of interest and Liquidated Damages, if any, the
maturity of which is on or prior to the Redemption Date, shall be
payable to Holders of record at the close of business on the
relevant Record Dates referred to in the Notes.
Prior to 11:00 A.M., New York City time, on the Redemption
Date, the Company shall deposit with the Paying Agent U.S. Legal
Tender sufficient to pay the Redemption Price plus accrued
interest and Liquidated Damages, if any, on, of all Notes to be
redeemed on that date. If the Company complies with such deposit
requirements, then, unless the Company defaults in the payment of
such Redemption Price plus accrued interest and Liquidated
Damages, if any, interest and Liquidated Damages, if any, on the
Notes to be redeemed will cease to accrue on and after the
applicable Redemption Date, whether or not such Notes are
presented for payment.
[9]. Mandatory Disposition or Redemption Pursuant to Gaming
Law.
If a Holder or beneficial owner of this Note is required to
be licensed, qualified or found suitable under applicable Gaming
Laws and is not so licensed, qualified or found suitable, or if a
Holder or a beneficial owner of this Note fails to take the steps
necessary to seek such license, qualification or finding of
suitability, the Holder or beneficial owner of this Note shall be
obliged, at the request of the Company, to dispose of such
Holder's or beneficial owner's Notes within 30 days after receipt
of notice of failure to be licensed, qualified or found suitable
or such earlier date prescribed by any Gaming Authority (in which
event the Company's obligation to pay any interest and Liquidated
Damages, if any, after the receipt of such notice shall be
limited as provided in such Gaming Laws), and thereafter, the
Company shall have the right to redeem, on the date fixed by the
Company for the redemption of such Notes, such Holder's or
beneficial owner's Notes at a redemption price equal to the
lowest of (i) the price at which such Holder or beneficial owner
acquired such Notes without accrued interest or Liquidated
Damages, if any, unless the payment of such interest or
Liquidated Damages, if any, is permitted by the applicable Gaming
Authority, in which case such interest and Liquidated Damages, if
any, shall be paid through the Redemption Date, (ii) the fair
market value of such Notes on such Redemption Date and (iii) the
principal amount of such Notes without accrued interest or
Liquidated Damages, if any, thereon, unless the payment of such
interest or Liquidated Damages, if any, is permitted by the
applicable Gaming Authority, in which case such interest and
Liquidated Damages, if any, shall be paid through the Redemption
Date. The Company is not required to pay or reimburse any Holder
or beneficial owner of this Note for the costs of licensure or
investigation for such licensure, qualification, or finding of
suitability. Any Holder or beneficial owner of this Note required
to be licensed, qualified or found suitable under applicable
Gaming Laws must pay all investigative fees and costs of the
Gaming Authorities in connection with such licensure,
qualification, suitability or application therefor.
[10]. Repurchase at the Option of Holders upon Change of
Control.
Upon a Change of Control, each Holder shall have the right
to require that the Company repurchase all or a part of such
Holder's Notes at a Purchase Price in cash equal to 101% of the
principal amount thereof plus accrued and unpaid interest and
Liquidated Damages, if any, to the Purchase Date.
Within 30 calendar days following any Change of Control, the
Company shall send, by first class mail to each Holder, a notice
respecting such Change of Control. The Holder of this Note may
elect to have this Note or a portion hereof in an authorized
denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note
to the Company at the address specified in the notice at least
five Business Days prior to the Purchase Date. Holders will be
entitled to withdraw their election if the Trustee or the Company
receives not later than three Business Days prior to the Purchase
Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Note
which was delivered for purchase by the Holder and a statement
that such Holder is withdrawing its election to have such Note
purchased.
On the Purchase Date, all Notes purchased by the Company
under this provision shall be delivered by the Trustee for
cancellation, and the Company shall pay the Purchase Price plus
accrued and unpaid interest and Liquidated Damages, if any, to
the Holders entitled thereto.
[11]. Repurchase at the Option of Holders upon Sale of
Assets.
If at any time the Company or any Restricted Subsidiary
engages in any Asset Disposition, as a result of which the
aggregate amount of Excess Proceeds (together with interest
thereon) exceeds $5 million, the Company shall make an offer to
purchase from all Holders on a pro rata basis the Notes at a
Purchase Price of 100% of their principal amount plus accrued and
unpaid interest and Liquidated Damages, if any, to the Purchase
Date and shall purchase from Holders accepting such offer, the
maximum principal amount of Notes that may be purchased from
funds in an amount equal to the then-existing Excess Proceeds.
Upon completion of such an Excess Proceeds Offer (including
payment of the Purchase Price for Notes duly tendered), the
Excess Proceeds that were the subject of such offer shall cease
to be Excess Proceeds and the Company or the Restricted
Subsidiary that engaged in the Asset Disposition, as applicable,
may use the remaining Excess Proceeds for general corporate
purposes.
Within 10 calendar days of the date on which the Company is
required to make an Excess Proceeds Offer, the Company shall
send, by first-class mail, a notice to each Holder respecting the
Excess Proceeds Offer. The Holder of this Note may elect to have
this Note or a portion hereof in an authorized denomination
purchased by completing the form entitled "Option of Holder to
Elect Purchase" appearing below and tendering this Note to the
Company at the address specified in the notice at least five
Business Days prior to the Purchase Date. Holders will be
entitled to withdraw their election if the Trustee or the Company
receives not later than three Business Days prior to the Purchase
Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Note
which was delivered for purchase by the Holder and a statement
that such Holder is withdrawing his election to have such Note
purchased.
On the Purchase Date, all Notes purchased by the Company
under this provision shall be delivered by the Trustee for
cancellation, and the Company shall pay the Purchase Price plus
accrued and unpaid interest and Liquidated Damages, if any, to
the Holders entitled thereto.
[12]. Repurchase of Notes on Loss of Material Gaming
License.
If at any time a License Loss occurs with respect to the
Company or a Restricted Subsidiary, and if any part of the
License Loss Amount is not applied by the Company or its
Restricted Subsidiaries in the manner and in the 40-day period
set forth in Section 4.20 of the Indenture, subject to certain
exceptions and conditions contained in the Indenture, the Company
shall, immediately upon expiration of such period, make a License
Loss Offer to all Holders in accordance with the procedures set
forth in the Indenture, and shall purchase from Holders accepting
such offer on a pro rata basis, the maximum principal amount of
Notes that may be purchased with such unapplied portion of the
License Loss Amount, at a Purchase Price of 101% of their
principal amount plus accrued and unpaid interest and Liquidated
Damages, if any, to the Purchase Date.
Prior to or upon the date on which the Company is required
to make a License Loss Offer, the Company shall send, by first-
class mail, a notice to each Holder respecting the License Loss
Offer. The Holder of this Note may elect to have this Note or a
portion hereof in an authorized denomination purchased by
completing the form entitled "Option of Holder to Elect Purchase"
appearing below and tendering this Note to the Company at the
address specified in the notice at least five Business Days prior
to the Purchase Date. Holders will be entitled to withdraw their
election if the Trustee or the Company receives not later than
three Business Days prior to the Purchase Date, a telegram,
telex, facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Note which was delivered
for purchase by the Holder and a statement that such Holder is
withdrawing his election to have such Note purchased.
On the Purchase Date, all Notes purchased by the Company
under this provision shall be delivered by the Trustee for
cancellation, and the Company shall pay the Purchase Price plus
accrued and unpaid interest and Liquidated Damages, if any, to
the Holders entitled thereto.
[13. The Global Note.
So long as this Global Note is registered in the name of the
Depositary or its nominee, members of, or participants in, the
Depositary ("Agent Members") shall have no rights under the
Indenture with respect to this Global Note held on their behalf
by the Depositary, or the Trustee as its custodian, and the
Depositary may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of this
Global Note for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee
or any agent of the Company or the Trustee from giving effect to
any written certification, proxy or other authorization furnished
by the Depositary or impair, as between the Depositary and its
Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of Notes.
The Holder of this Global Note may grant proxies and
otherwise authorize any Person, including Agent Members and
Persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under the Indenture
or this Note.
Whenever, as a result of optional redemption by the Company,
a Change of Control offer, an Excess Proceeds Offer, a License
Loss Offer, an Exchange Offer (as defined in the Registration
Rights Agreement) or an exchange for Physical Notes, this Global
Note is redeemed, repurchased or exchanged in part, this Global
Note shall be surrendered by the Holder hereof to the Trustee who
shall cause an adjustment to be made to Schedule A hereof so that
the principal amount of this Global Note will be equal to the
portion not redeemed, repurchased or exchanged and shall
thereafter return this Global Note to such Holder, provided that
this Global Note shall be in a principal amount of $1,000 or an
integral multiple of $1,000.]11
[14. The Exchange Offer.
If this Note is presented to the Registrar for exchange
pursuant to the Exchange Offer (as defined in the Registration
Rights Agreement), it shall be exchanged for an Exchange Note of
equal principal amount in accordance with the terms of the
Exchange Offer and the Indenture.]12
[15]. Denomination, [Transfer and Exchange]13.
The Notes shall be issuable in fully registered form only,
without coupons, in denominations of $1,000 and any integral
multiple thereof. [By its acceptance of any Note bearing the
Private Placement Legend set forth above, each Holder of such a
Note acknowledges the restrictions on transfer of such Note set
forth in the Indenture and in the Private Placement Legend and
agrees that it will transfer such Note only as provided in the
Indenture.] 14
[16]. Repayment to the Company.
Subject to Article Eight of the Indenture, any U.S. Legal
Tender or U.S. Government Obligations deposited with the Trustee
or the Paying Agent or another trustee for payment of the
principal of, premium and Liquidated Damages, if any, or interest
on any Note and remaining unclaimed for two years after such
principal, premium and Liquidated Damages, if any, or interest
has become due and payable, shall be promptly paid to the Company
upon its written request and the Trustee and the Paying Agent
thereupon shall be relieved from all liability with respect to
such funds; provided that the Trustee or such Paying Agent,
before being required to make any payment, may at the expense of
the Company cause to be published once in a newspaper of general
circulation in The City of New York or mail to each Holder
entitled to such money notice that such money remains unclaimed
and that after a date specified therein which shall be at least
30 days from the date of such publication or mailing any
unclaimed balance of such funds then remaining will be repaid to
the Company. After payment to the Company Noteholders entitled
to such funds must look to the Company for payment as general
creditors unless an applicable law designates another Person.
[17]. Discharge and Defeasance.
Subject to certain conditions contained in the Indenture,
the Company at any time may terminate some or all of its
obligations under the Notes and the Indenture if the Company
irrevocably deposits with the Trustee, the Paying Agent or a
trustee satisfactory to the Trustee money or U.S. Government
Obligations for the payment of principal and interest on the
Notes to maturity or redemption, as the case may be.
[18]. Amendment, Waiver.
Subject to conditions set forth in the Indenture, the
Company and the Guarantors, when authorized by Board Resolutions,
and the Trustee, together, may amend or supplement the Indenture
or the Notes without notice to or consent of any Noteholder
(i) to cure any ambiguity, defect or inconsistency; provided that
such amendment or supplement does not, in the opinion of the
Trustee, adversely affect the rights of any Holder in any
material respect; (ii) to provide for uncertificated Notes in
addition to or in place of certificated Notes; (iii) to comply
with any requirements of the SEC in order to effect or maintain
the qualification of this Indenture under the TIA; (iv) to make
any change that would provide any additional benefit or rights to
the Noteholders or that does not adversely affect the rights of
any Noteholder; (v) to provide for issuance of the Exchange
Notes, which will have terms substantially identical in all
material respects to the Initial Notes (except that the transfer
restrictions and the reference to the Registration Rights
Agreement with respect to Liquidated Damages and registration
rights contained in the Initial Notes will be modified or
eliminated, as appropriate), and which will be treated together
with any outstanding Initial Notes, as a single issue of
securities; (vi) to provide for the assumption of the Company's
or any Guarantor's obligations to Noteholders by a successor
company or guarantor; (vii) to release any Subsidiary Guarantee
in accordance with the provisions of the Indenture; (viii) to
provide for additional Guarantors; or (ix) to make any other
change that does not, in the opinion of the Trustee, adversely
affect in any material respect the rights of any Noteholders
under the Indenture.
Subject to certain exceptions and conditions set forth in
the Indenture, the Company and the Guarantors, when authorized by
a Board Resolution, and the Trustee, together, with the written
consent of the Holder or Holders of at least a majority in
aggregate principal amount of then outstanding Notes, may amend
or supplement the Indenture or the Notes, without notice to any
other Noteholders. Subject to certain exceptions set forth in
the Indenture, the Holder or Holders of a majority in aggregate
principal amount of then outstanding Notes may waive compliance
by any Obligor with any provision of the Indenture or the Notes
without notice to any other Noteholder. After an amendment,
supplement or waiver pursuant to the Indenture becomes effective,
the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the
validity of any such supplemental indenture.
[19]. Defaults and Remedies.
If an Event of Default occurs and is continuing and has not
been waived pursuant to the Indenture, the Trustee by notice to
the Company, or the Holders of at least 25% in principal amount
of the Notes by notice to the Company and the Trustee, subject to
certain limitations, may declare the principal of and accrued
interest and Liquidated Damages, if any, on all the Notes to be
immediately due and payable. Certain events of bankruptcy or
insolvency are Events of Default and shall result in the Notes
being immediately due and payable upon the occurrence of such
Events of Default without any declaration or other act on the
part of the Trustee or any Noteholders.
In the case of any Event of Default occurring by reason of
any willful action (or inaction) taken (or not taken) by or on
behalf of the Company with the intention of avoiding payment of
the premium that the Company would have had to pay if the Company
then had elected to redeem the Notes pursuant to the optional
redemption provisions hereof, an equivalent premium shall also
become and be immediately due and payable to the extent permitted
by law upon the acceleration of the Notes. If an Event of
Default occurs prior to August 1, 2001, by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding the prohibition on
redemption of the Notes prior to August 1, 2001, then the premium
specified in the third paragraph of Section [7] of this Note
shall also become immediately due and payable to the extent
permitted by law upon the acceleration of the Notes.
Subject to certain conditions contained in the Indenture,
the Holders of a majority in principal amount of the outstanding
Notes may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it, including, without
limitation, any remedies provided for in Section 6.03 of the
Indenture. Subject to Section 7.01 of the Indenture, however,
the Trustee may refuse to follow any direction that the Trustee
reasonably believes conflicts with any law or the Indenture, that
the Trustee determines may be unduly prejudicial to the rights of
another Noteholder, or that may involve the Trustee in personal
liability; provided that the Trustee may take any other action
deemed proper by the Trustee which is not inconsistent with such
direction.
A Noteholder may not pursue any remedy with respect to the
Indenture or the Notes unless: (i) the Holder gives to the
Trustee written notice stating that an Event of Default is
continuing; (ii) the Holders of at least 25% in principal amount
of the Notes make a written request to the Trustee to pursue the
remedy; (iii) such Holder or Holders offer to the Trustee
reasonable security or indemnity against any loss, liability or
expense; (iv) the Trustee does not comply with the request within
60 days after receipt of the request and the offer of security or
indemnity; and (v) the Holders of a majority in principal amount
of the Notes do not give the Trustee a direction inconsistent
with the request during such 60-day period.
The Holders of a majority in principal amount of the Notes
by notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have
been cured or waived except nonpayment of principal or interest
that has become due solely because of acceleration. No such
rescission shall affect any subsequent Default or impair any
right consequent thereto.
[20]. Subordination; Senior Indebtedness Under Gem
Notes.
The payment of principal of, premium, if any, and interest
on the Notes is subordinated to the prior payment in full of all
Obligations with respect to Senior Indebtedness of the Company
and any Guarantor (whether outstanding on the date of this
Indenture or thereafter incurred), as set forth in Article Ten of
the Indenture. The Company hereby designates, with respect to
each Gem Note, the Indebtedness evidenced by this Note and the
Indenture as Senior Indebtedness, as such term is defined in such
Gem Notes.
[21]. Individual Rights of Trustee.
Subject to certain limitations contained in the Indenture,
the Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the
Company, any Subsidiary of the Company, or their respective
Affiliates with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights.
[22]. Trustee's Disclaimer
The Trustee makes no representation as to the validity or
adequacy of the Indenture or the Notes, and it shall not be
accountable for the Company's use of the proceeds from the Notes,
and it shall not be responsible for any statement of the Company
in the Indenture or the Notes other than the Trustee's
certificate of authentication.
[23]. No Recourse Against Certain Others.
A director, officer, employee, stockholder or incorporator,
as such, of any Obligor or of the Trustee shall not have any
liability for any obligations of any Obligor under the Notes or
the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creations. Each Noteholder
by accepting a Note waives and releases all such liability. Such
waiver and release are part of the consideration for the issuance
of the Notes.
[24]. Governing Law.
THIS NOTE AND THE INDENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF
NEW YORK. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE.
[25]. Liability of ACCBI.
Notwithstanding anything herein to the contrary, ACCBI shall
have no obligation or liability hereunder prior to the time, if
at all, the Indenture and the Subsidiary Guarantee of ACCBI
provided for therein shall have been approved by the Iowa Racing
and Gaming Commission.
The Company will furnish to any Holder of Notes upon written
request and without charge to the Holder a copy of the Indenture
which has in it the text of this Note. Requests may be made to:
Ameristar Casinos, Inc.
3773 Howard Hughes Parkway
Suite 490 South
Las Vegas, Nevada 89109
Attention: Chief Financial Officer
[SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount at maturity of this Note shall be
$___________. The following decreases/increase in the principal
amount at maturity of this Note have been made:
Total
Principal
Amount at
Date of Decrease in Increase in Maturity Notation
Decrease/ Principal Principal Following Made by or
Increase Amount at Amount at such on Behalf
Maturity Maturity Decrease/ of Trustee]15
Increase
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED ______________________________ hereby
sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
_________________________________________________________________
_____________
(Please print name and address of transferee)
_________________________________________________________________
_____________
this Note, together with all right, title and interest herein,
and does hereby irrevocably constitute and appoint
_______________________ Attorney to transfer this Note on the
Register, with full power of substitution.
Dated: __________________________
__________________________________
________________________________
Signature of Holder Signature Guaranteed:
(Signature must be guaranteed by a bank or trust company having
an office or correspondent in the United States or by a member
firm of a registered securities exchange or the National
Association of Securities Dealers, Inc. The guarantor of
signature must be a participant in the Medallion Stamp Program.)
NOTICE: The signature to the foregoing Assignment must
correspond to the Name as written upon the face of this Note in
every particular, without alteration or any change whatsoever.
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
In connection with the offer made upon a Change of
Control pursuant to Section 4.14 of the Indenture, the
undersigned hereby elects to have
the entire principal amount
$ __________________($1,000 in principal amount or
an integral multiple thereof) of this Note
repurchased by the Company. The undersigned hereby
directs the Trustee or Paying Agent to pay it or
___________________ an amount in cash equal to 101% of
the principal amount indicated in the preceding
sentence, plus accrued and unpaid interest and
Liquidated Damages, if any, to the Purchase Date.
In connection with the Excess Proceeds Offer made
pursuant to Section 4.15 of the Indenture, the
undersigned hereby elects to have
the entire principal amount (or the maximum amount
thereof after selection of Notes for repurchase on a
pro rata basis)
$ __________________($1,000 in principal amount or
an integral multiple thereof) of this Note
repurchased by the Company. The undersigned hereby
directs the Trustee or Paying Agent to pay it or
_____________________ an amount in cash equal to 100%
of the principal amount indicated in the preceding
sentence, plus accrued and unpaid interest and
Liquidated Damages, if any, to the Purchase Date.
In connection with the License Loss Offer made pursuant
to Section 4.20 of the Indenture, the undersigned
hereby elects to have
the entire principal amount (or the maximum amount
thereof after selection of Notes for repurchase on a
pro rata basis)
$ __________________($1,000 in principal amount or
an integral multiple thereof) of this Note
repurchased by the Company. The undersigned hereby
directs the Trustee or Paying Agent to pay it or
_____________________ an amount in cash equal to 100%
of the principal amount indicated in the preceding
sentence, plus accrued and unpaid interest and
Liquidated Damages, if any, to the Purchase Date.
Dated: ______________________
__________________________________
________________________________
Signature of Holder Signature Guaranteed:
(Signature must be guaranteed by a bank or trust company having
an office or correspondent in the United States or by a member
firm of a registered securities exchange or the National
Association of Securities Dealers, Inc. The guarantor of
signature must be a participant in the Medallion Stamp Program.)
NOTICE: The signature to the foregoing must correspond to the
Name as written upon the face of this Note in every particular,
without alteration or any change whatsoever.
EXHIBIT B
Form of Certificate To Be Delivered
in Connection with Transfers to Non-U.S. Persons
Pursuant to Regulation S
_______________________, ____
First Trust National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attention: Corporate Trust Administration
Re:Ameristar Casinos, Inc. (the "Company")
10 1/2% Senior Subordinated Notes due 2004 Series A
(the "Notes")
Ladies and Gentlemen:
In connection with our proposed transfer of $___________
aggregate principal amount of the Notes (the "Transfer"), we
confirm that (i) we are familiar with the transfer provisions of
the Indenture, dated as of July 15, 1997, by and among the
Company, the Guarantors named therein and you, as Trustee (the
"Indenture"), and (ii) such Transfer has been effected in
compliance with Regulation S under the Securities Act of 1933, as
amended (the "Securities Act"), and, accordingly, we represent
that:
(1) the offer of the Notes was not made to a person in
the United States;
(2) either (a) at the time the buy offer or order was
originated, the transferee was outside the United States or
we and any person acting on our behalf reasonably believed
that the transferee was outside the United States, or (b)
the transaction was executed in, on or through the
facilities of a designated off-shore securities market and
neither we nor any person acting on our behalf knows that
the transaction has been pre-arranged with a buyer in the
United States;
(3) no directed selling efforts have been made in the
United States in contravention of the requirements of Rule
903(b) or Rule 904(b) of Regulation S, as applicable;
(4) the Transfer is not part of a plan or scheme to
evade the registration requirements of the Securities Act;
(5) we have advised the transferee of the transfer
restrictions applicable to the Notes; and
(6) if the Transfer will occur prior to the expiration
of the Restricted Period (as defined in the Indenture), the
interest transferred will be held immediately hereafter
through Euroclear or CEDEL (as defined in the Indenture).
You and the Company are entitled to rely upon this letter
and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters
covered hereby. Terms used in this certificate have the meanings
set forth in Regulation S.
Very truly yours, [Name of
Transferor]
By:__________________________
Authorized Signature
EXHIBIT C
Form of Certificate To Be Delivered
in Connection with Transfers to QIBs
_______________________, ____
First Trust National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attention: Corporate Trust Administration
Re:Ameristar Casinos, Inc. (the "Company")
10 1/2% Senior Subordinated Notes due 2004 Series A
(the "Notes")
Ladies and Gentlemen:
In connection with our proposed transfer of $___________
aggregate principal amount of the Notes (the "Transfer"), we
confirm that (i) we are familiar with the transfer provisions of
the Indenture, dated as of July 15, 1997, by and among the
Company, the Guarantors named therein and you, as Trustee (the
"Indenture"), and (ii) such Transfer has been effected in
compliance with Rule 144A under the Securities Act of 1933, as
amended (the "Securities Act"), and, accordingly, we represent
that:
(1) the Transfer is being made to a person whom we
reasonably believe is purchasing for its own account or
accounts as to which it exercises sole investment discretion
and that such person and each such account is a "qualified
institutional buyer" within the meaning of Rule 144A under
the Securities Act; and
(2) the Transfer otherwise complies with the
requirements of Rule 144A.
You and the Company are entitled to rely upon this letter
and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters
covered hereby. Terms used in this certificate have the meanings
set forth in Rule 144A.
Very truly yours, [Name of
Transferor]
By:__________________________
Authorized Signature
EXHIBIT D
EXHIBIT D - PORTIONS OF FINAL OFFERING MEMORANDUM
Gem Notes
Upon the effectiveness of the Gem Settlement Agreement on
June 20, 1997, Ameristar issued the Gem Notes in the aggregate
amount of $28.7 million. See "Business - The Gem Merger." The
per annum interest rate on the Gem Notes is 8%, subject to
increase by 3.4 or 3.3 percentage points, up to a maximum of 18%
per annum, following one or more failures to make payments under
the Gem Notes by scheduled dates. Interest is scheduled to be
paid initially on a quarterly basis and on a monthly basis after
October 1998. Any interest not paid when scheduled will
thereafter accrue interest as principal. A principal reduction
payment of $2.0 million is scheduled for November 1998, followed
by semiannual principal reduction payments of $1.0 million
commencing in July 1999 until January 2002, when the semiannual
principal reduction payments will increase to $1.5 million. The
Gem Notes mature on December 31, 2004. The Gem Notes are not be
subject to acceleration or other collection efforts upon failure
to make a scheduled payment prior to maturity, and the only
remedy for such a failure to make a scheduled payment is the
increase in interest rate described above. The failure to make a
scheduled payment under the Gem Notes will not constitute an
event of default under the Revolving Credit Facility or the
Indenture.
The Gem Notes may be prepaid in whole or in part at any time
without penalty. The Gem Notes are subordinate to the Revolving
Credit Facility, the Notes and other long-term indebtedness of
Ameristar specified by Ameristar up to a maximum of $250 million,
plus additional indebtedness incurred in connection with certain
interest rate protection or similar agreements related to senior
indebtedness. The Gem Notes are unsecured and do not bind the
Company to any affirmative or negative covenants other than the
payment obligations and a covenant prohibiting Ameristar from
incurring more than $250 million in senior indebtedness. A
portion of the Gem Notes ($15 million) expressly provide that
Ameristar may set off any liabilities of the Gem Stockholders to
the Company. Ameristar will be permitted to effect such a setoff
even if such Gem Notes have been transferred to a third party
holder. The release of the Gem Stockholders provided for in the
Gem Settlement Agreement excludes certain claims that the Company
may have against the Gem Stockholders. See "Business - The Gem
Merger."
Vicksburg Hotel Loan
The Company intends that AC Hotel Corp., a newly formed
wholly owned subsidiary of ACVI, will enter into a loan agreement
in July 1997 providing for borrowings of up to $7.5 million for
the purpose of funding a portion of the construction costs of a
148-room hotel at Ameristar Vicksburg. The Company is currently
negotiating with a private lender for a nonrecourse loan that
would be secured by a deed of trust on the hotel and the
underlying land senior in priority to the liens securing the
Revolving Credit Facility. The Company anticipates that this
loan will have a maturity date of not earner than June 1, 1998
and require monthly or quarterly interest payments. However, no
assurance can be given that this or any other loan will be
obtained on these terms or other terms acceptable to the Company.
EXHIBIT E
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"),
dated as of , ____, among
(the "Additional Guarantor"), Ameristar Casinos, Inc., a Nevada
corporation (the "Company"), the other Guarantors listed on the
signature pages hereto (the "Existing Guarantors") and First
Trust National Association, as trustee under the indenture
referred to below (the "Trustee").
RECITALS
A. The Company, as Issuer, and Ameristar Casino Las Vegas,
Inc., a Nevada corporation, Ameristar Casino Council Bluffs,
Inc., an Iowa corporation, Ameristar Casino Vicksburg, Inc., a
Mississippi corporation, A.C. Food Services, Inc., a Nevada
corporation and AC Hotel Corp., a Mississippi corporation, have
heretofore executed and delivered to the Trustee an indenture
(the "Indenture"), dated as of July 15, 1997, providing for the
issuance of an aggregate principal amount at maturity of
$100,000,000 of 10 1/2 Senior Subordinated Notes due 2004 (the
"Notes");
B. Section 4.22 of the Indenture provides that under
certain circumstances the Company is required to cause the
Additional Guarantor to execute and deliver to the Trustee a
supplemental indenture pursuant to which the Additional Guarantor
shall unconditionally guarantee all of the Company's obligations
under the Notes pursuant to a Subsidiary Guarantee on the terms
and conditions set forth in Article Eleven of the Indenture; and
C. Pursuant to Section 9.01 of the Indenture, the Trustee
is authorized to execute and deliver this Supplemental Indenture.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and for
other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto mutually covenant and
agree for the equal and ratable benefit of the Holders of the
Notes as follows:
1. Capitalized Terms. Capitalized terms used herein
without definition shall have the meanings assigned to them in
the Indenture.
2. Agreement to Guarantee. The Additional Guarantor
hereby agrees, jointly and severally with all other Guarantors,
to guarantee the Company's Obligations on the terms and subject
to the conditions set forth in Article Eleven of the Indenture
and to be bound by all other provisions of the Indenture
applicable to Guarantors, subject to the terms and conditions of
the Indenture.
3. No Recourse Against Others. A director, officer,
employee, stockholder or incorporator, as such, of any Obligor or
of the Trustee shall not have any liability for any obligations
of any Obligor under the Notes, this Supplemental Indenture or
the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creations. Each Noteholder
by accepting a Note waives and releases all such liability. Such
waiver and release are part of the consideration for the issuance
of the Notes.
4. Governing Law. THIS SUPPLEMENTAL INDENTURE, THE NOTES
AND THE INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK. EACH
OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS SUPPLEMENTAL INDENTURE.
5. Counterparts. This Supplemental Indenture may be
executed in any number of counterparts and by the parties hereto
in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall
constitute one and the same agreement.
6. Effect of Headings. The Section headings herein are
for convenience only and shall not affect the construction
hereof.
7. Consent of Existing Guarantors; Status of Existing
Guarantees. By its execution hereof, each Existing Guarantor
confirms that it is a Guarantor of the Company's Obligations
pursuant to a Subsidiary Guarantee on the terms and conditions
set forth in Article Eleven of the Indenture and hereby
(i) consents to the execution of this Supplemental Indenture by
the Company and the Additional Guarantor and to the addition to
the Indenture of the Additional Guarantor, and (ii) confirms that
the Subsidiary Guarantee to which it is a party is and shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed and attested, all as
of the date first above written.
ADDITIONAL GUARANTOR
[ ]
By:
Name:
Title:
[Corporate Seal]
Attest:
By:
Name:
Title:
Dated:
AMERISTAR CASINOS, INC.
By:
Name:
Title:
[Corporate Seal]
Attest:
By:
Name:
Title:
Dated:
[EXISTING GUARANTORS]
By:
Name:
Title:
[Corporate Seal]
Attest:
By:
Name:
Title:
Dated:
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
By:_____________________________
Name:
Title:
EXHIBIT F
FORM OF SUBSIDIARY GUARANTEE
Each Guarantor listed below (hereinafter referred to as
the "Guarantors") hereby jointly and severally and
unconditionally guarantees to each Holder of a _% Senior
Subordinated Note due 2004 (the "Notes") of Ameristar Casinos,
Inc., a Nevada corporation (the "Company") authenticated and
delivered by the Trustee, irrespective of the validity or
enforceability of that certain Indenture, by and among the
Company, the Guarantors named therein, and First Trust National
Association, as Trustee, dated as of July 15, 1997, as amended or
supplemented (the "Indenture"), the Notes or the Obligations of
the Company under the Indenture or the Notes, that: (i) the
principal of, interest, premium, if any, and Liquidated Damages,
if any, on the Notes will be paid in full when due, whether at
the Maturity Date, any Interest Payment Date, any Redemption Date
or Purchase Date, by acceleration, call for redemption, offer to
purchase or otherwise, and interest on the overdue principal of
and interest and Liquidated Damages, if any, on the Notes and all
other Obligations of the Company to the Holders or the Trustee
under the Indenture or the Notes will be promptly paid in full or
performed, all in accordance with the terms of the Indenture and
the Notes; and (ii) in case of any extension of time of payment
or renewal of any Notes or any of such other Obligations, they
will be paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at maturity, by
acceleration or otherwise. Failing payment when due (including
any applicable grace periods) of any amount so guaranteed for
whatever reason, each Guarantor will be obligated to pay the same
pursuant to the preceding sentence whether or not such failure to
pay has become an Event of Default that could cause acceleration
pursuant to Section 6.02 of the Indenture. Each Guarantor agrees
that this is a guarantee of payment and not a guarantee of
collection.
The obligations of each Guarantor to the Holders of Notes
and to the Trustee pursuant to this Subsidiary Guarantee and the
Indenture are expressly set forth in Article Eleven of the
Indenture and reference is hereby made to such Indenture for the
precise terms of this Subsidiary Guarantee. THE TERMS OF ARTICLE
ELEVEN OF THE INDENTURE ARE INCORPORATED HEREIN BY REFERENCE. In
the case of any discrepancy between this writing and Article
Eleven of the Indenture, Article Eleven of the Indenture shall
control.
This is a continuing Subsidiary Guarantee and shall remain
in full force and effect and shall be binding upon each Guarantor
and its successors and assigns until full, final and indefeasible
payment of all of the Company's Obligations under the Notes and
the Indenture (subject to Section 11.02 of the Indenture) and
shall inure to the benefit of the successors and assigns of the
Trustee and the Holders of Notes and, in the event of any
transfer or assignment of rights by any Holder of Notes or the
Trustee, the rights and privileges herein conferred upon the
party shall automatically extend to and be vested in such
transferee or assignee, all subject to the terms and conditions
hereof.
If the obligations of any Guarantor hereunder otherwise
would be subject to avoidance under Section 548 of the Bankruptcy
Law or any applicable state law relating to fraudulent
conveyances or fraudulent transfers, taking into consideration
such Guarantor's (i) rights of reimbursement and indemnity from
the Company with respect to amounts paid by such Guarantor and
(ii) rights of contribution from other Guarantors pursuant to
Section 11.03 of the Indenture, then such obligations hereby are
reduced to the largest amount that would make them not subject to
such avoidance. Any Person asserting that such Guarantor's
obligations are so avoidable shall have the burden (including the
burden of production and of persuasion) of proving (a) that,
without giving effect to this paragraph, such Guarantor's
obligations hereunder would be avoidable and (b) the extent to
which such obligations are reduced by operation of this
paragraph.
This Subsidiary Guarantee shall not be valid or obligatory
for any purpose until the certificate of authentication on the
Note upon which this Subsidiary Guarantee is noted shall have
been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
Capitalized terms used herein have the same meanings given
in the Indenture unless otherwise indicated.
GUARANTORS
By:_____________________________
Name:
Title:
_______________________________
1 The Initial Notes shall be marked as Series A and the
Exchange Notes shall be marked as Series B.
2 Appears only on Global Notes.
3 The Initial Notes shall be marked as Series A and the
Exchange Notes shall be marked as Series B.
4 Appears only on the Initial Notes.
5 Appears only on the Global Notes.
6 The Initial Notes shall be marked as Series A and the
Exchange Notes shall be marked as Series B.
7 Appears only on Initial Notes.
8 Appears only on Exchange Notes.
9 Appears only on Initial Notes.
10 Appears only on Global Notes.
11 Appears only on Global Note.
12 Appears only on Initial Notes.
13 Appears only on Initial Notes.
14 Appears only on Initial Notes.
15 Schedule appears only on Global Notes.
REGISTRATION RIGHTS AGREEMENT
Dated as of July 15, 1997
by and among
AMERISTAR CASINOS, INC.
as Issuer
and
AMERISTAR CASINO COUNCIL BLUFFS, INC.,
A.C. FOOD SERVICES, INC.,
AC HOTEL CORP.,
AMERISTAR CASINO LAS VEGAS, INC.,
AMERISTAR CASINO VICKSBURG, INC.
and
CACTUS PETE'S, INC.
as Guarantors
and
BEAR, STEARNS & CO. INC.,
BT SECURITIES CORPORATION
and
FIRST CHICAGO CAPITAL MARKETS, INC.
as Initial Purchasers
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement"), is
made and entered into as of July 15, 1997, among AMERISTAR
CASINOS, INC., a Nevada corporation (the "Issuer"), and AMERISTAR
CASINO COUNCIL BLUFFS, INC., an Iowa corporation ("ACCBI"), A.C.
FOOD SERVICES, INC., a Nevada corporation, AC HOTEL CORP., a
Mississippi corporation, AMERISTAR CASINO LAS VEGAS, INC., a
Nevada corporation, AMERISTAR CASINO VICKSBURG, INC., a
Mississippi corporation, and CACTUS PETE'S, INC., a Nevada
corporation ("CPI"), (together, the "Guarantors") and BEAR,
STEARNS & CO. INC., BT SECURITIES CORPORATION and FIRST CHICAGO
CAPITAL MARKETS, INC. (together, the "Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement,
dated July 10, 1997, among the Issuer, the Guarantors and the
Initial Purchasers (the "Purchase Agreement"), which provides for
the sale by the Issuer to the Initial Purchasers of $100,000,000
aggregate principal amount of 10 1/2% Senior Subordinated Notes
due 2004 Series A (the "Initial Notes"). The Issuer's
obligation's under, among other things, the Initial Notes, are
guaranteed by the Guarantors (or, in the case of CPI and ACCBI,
will be so guaranteed upon the receipt of all requisite approvals
under Gaming Laws (as defined in the Purchase Agreement) (as in
effect from time to time, the "Subsidiary Guarantees"). In order
to induce the Initial Purchasers to enter into the Purchase
Agreement, the Issuer has agreed to provide to the Initial
Purchasers and their respective direct and indirect transferees,
among other things, the registration rights for the Initial Notes
set forth in this Agreement. The execution of this Agreement is
a condition to the closing of the transactions contemplated by
the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have
the following meanings (and, unless otherwise indicated,
capitalized terms used herein without definition shall have the
respective meanings ascribed to them in the Purchase Agreement):
Applicable Period: See Section 2(f) hereof.
Business Day: Any day except a Saturday, Sunday or other
day in the City of New York, or in the city of the corporate
trust office of the Trustee, on which banks are authorized to
close.
Closing Date: The Closing Date as defined in the Purchase
Agreement.
Direct Broker - Dealer Buyer: See Section 2(b) hereof.
Effectiveness Period: See Section 3(a) hereof.
Effectiveness Target Date: The 180th day following the
Closing Date.
Exchange Act: The Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated
thereunder, and any succeeding provisions thereto.
Exchange Notes: See Section 2(a) hereof.
Exchange Offer: See Section 2(a) hereof.
Exchange Offer Registration Statement: See
Section 2(a) hereof.
Filing Date: The 60th day after the Closing Date.
Holder: Any holder of Transfer Restricted Securities.
Indemnified Party: See Section 7 hereof.
Indemnifying Party: See Section 7 hereof.
Indenture: The Indenture, dated as of July 15, 1997, by and
among the Issuer, the Initial Guarantors, and First Trust
National Association, as Trustee, pursuant to which the Initial
Notes are being issued, as amended or supplemented from time to
time in accordance with the terms thereof.
Initial Guarantors: Each of the Guarantors except for CPI.
Initial Notes: See the introductory paragraphs to this
Agreement.
Initial Purchasers: See the introductory paragraph to this
Agreement.
Inspectors: See Section 5(m) hereof.
Issuer: See the introductory paragraph of this Agreement.
Issuer Affiliate: See Section 2(b) hereof.
Liquidated Damages: See Section 4(a) hereof.
Participating Broker-Dealer: Any broker-dealer (as defined
in the Exchange Act), other than a Direct Broker-Dealer Buyer,
that is a Holder or beneficial owner (as defined in Rule 13d-3
under the Exchange Act) of Initial Notes acquired for its own
account as a result of market-making activities or other trading
activities that are tendered for exchange in the Exchange Offer
and that thereafter holds Exchange Notes issued in exchange
therefor.
Person or person: An individual, trustee, corporation,
partnership, joint stock company, trust, unincorporated
association, union, business association, limited liability
company, limited liability partnership, firm or other legal
entity.
Prospectus: The prospectus included in any Registration
Statement (including, without limitation, any prospectus subject
to completion and a prospectus that includes any information
previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented
by any prospectus supplement, with respect to the terms of the
offering of any portion of the Exchange Notes and/or the Transfer
Restricted Securities (as applicable), covered by such
Registration Statement, and all other amendments and supplements
to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated
by reference in such Prospectus.
Purchaser Indemnitee: See Section 7 hereof.
Records: See Section 5(m) hereof.
Registration Default: See Section 4(a) hereof.
Registration Statement: Any registration statement of the
Issuer and the Guarantors, including, but not limited to, the
Exchange Offer Registration Statement, the Shelf Registration
Statement or a registration statement of the Issuer that
otherwise covers any of the Transfer Restricted Securities
pursuant to the provisions of this Agreement, including the
Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and
all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.
Rule 144: Rule 144 promulgated pursuant to the Securities
Act, as currently in effect, as such rule may be amended from
time to time, or any similar rule or regulation hereafter adopted
by the SEC.
Rule 144A: Rule 144A promulgated pursuant to the Securities
Act, as currently in effect, as such rule may be amended from
time to time, or any similar rule or regulation hereafter adopted
by the SEC.
Rule 415: Rule 415 promulgated pursuant to the Securities
Act, as such rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder, and
any succeeding provisions thereto.
Shelf Notice: See Section 2(g) hereof.
Shelf Registration Statement: See Section 3(a) hereof.
TIA: The Trust Indenture Act of 1939, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Transfer Restricted Securities: The Initial Notes upon
original issuance thereof and at all times subsequent thereto,
until (i) a Registration Statement covering such Initial Notes
has been declared effective by the SEC and such Initial Notes
have been disposed of in accordance with such effective
Registration Statement, (ii) such Initial Notes are sold in
compliance with Rule 144 or (iii) such Initial Notes cease to be
outstanding.
Trustee: The trustee under the Indenture and, if existent,
the trustee under any indenture governing the Exchange Notes.
Underwritten registration or underwritten offering: A
registration in which securities of the Issuer are sold to an
underwriter for reoffering to the public.
2. Exchange Offer
(a) The Issuer and the Guarantors agree to file with the
SEC as soon as practicable after the Closing Date, but in no
event later than the Filing Date, an offer to exchange (the
"Exchange Offer"), any and all of the Transfer Restricted
Securities for a like aggregate principal amount of debt
securities of the Issuer as guaranteed by Subsidiary Guarantees
in effect from time to time (subject to, in the case of CPI and
ACCBI, the receipt of all requisite approvals under Gaming Laws)
(the "Exchange Notes"), which Exchange Notes will be
(i) substantially identical in all material respects to the
Initial Notes, except that such Exchange Notes will not contain
terms with respect to transfer restrictions, registration rights
or the obligation to pay any Liquidated Damages, (ii) entitled to
the benefits of the Indenture or a trust indenture which is
identical to the Indenture (other than such changes to the
Indenture or any such identical trust indenture as are necessary
to comply with any requirements of the SEC or to effect or
maintain the qualification thereof under the TIA), and which, in
either case, has been qualified under the TIA, and
(iii) registered pursuant to an effective Registration Statement
in compliance with the Securities Act. The Exchange Offer will
be registered pursuant to the Securities Act on an appropriate
form of Registration Statement (the "Exchange Offer Registration
Statement"), and will comply with all applicable tender offer
rules and regulations promulgated pursuant to the Exchange Act
and shall be duly registered or qualified pursuant to all
applicable state securities or Blue Sky laws. The Exchange Offer
shall not be subject to any condition, other than that the
Exchange Offer does not violate any applicable law, policy or
interpretation of the staff of the SEC. No securities shall be
included in the Exchange Offer Registration Statement other than
the Exchange Notes. The Issuer and the Guarantors agree to
(x) use their best efforts to cause the Exchange Offer
Registration Statement to be declared effective and to cause the
Exchange Offer to be consummated on or prior to the Effectiveness
Target Date and (y) keep the Exchange Offer open for not less
than 20 Business Days (or such longer period required by
applicable law), after the date that the notice of the Exchange
Offer referred to below is mailed to Holders.
(b) Each Holder who participates in the Exchange Offer will
be required to represent (which representation may be contained
in the letter of transmittal contemplated by the Exchange Offer
Registration Statement) that (i) any Exchange Notes received by
it will be acquired in the ordinary course of its business,
(ii) at the time of the consummation of the Exchange Offer such
Holder is not engaged in, and does not intend to engage in, and
has no arrangement or
understanding with any person to participate in, the distribution
of the Exchange Notes, and (iii) such Holder is not (1) an
"affiliate" of the Issuer or any Guarantor (an "Issuer
Affiliate") or, (2) an Initial Purchaser or any other broker-
dealer that acquired such Transfer Restricted Securities directly
from the Issuer or any Guarantor or any Issuer Affiliate for
resale pursuant to Rule 144A, Regulation S or another available
exemption from the registration requirements of the Securities
Act (a "Direct Broker-Dealer Buyer"). As used herein,
"affiliate" shall be as defined in Rule 405 under the Securities
Act. Each Holder hereby acknowledges and agrees that any Issuer
Affiliate, any Direct Broker-Dealer Buyer, and any such Holder
intending to use the Exchange Offer to participate in a
distribution of the securities to be acquired in the Exchange
Offer (i) could not under SEC policy as in effect on the date of
this Agreement participate in the Exchange Offer, and (ii) must
comply with the registration and prospectus delivery requirements
of the Securities Act in connection with a secondary resale
transaction and that such a secondary resale transaction of such
Holder's Initial Notes should be covered by an effective
registration statement containing the selling security holder and
other information required by Item 507 and 508, as applicable, of
Regulation S-K under the Securities Act.
(c) Prior to the effectiveness of the Exchange Offer
Registration Statement, the Issuer and the Guarantors shall
provide a supplemental letter to the SEC (a) stating that the
Issuer and the Guarantors are seeking to register the Exchange
Offer on the basis of the position of the SEC enunciated in
Morgan Stanley and Co., Inc. (available June 5, 1991), Exxon
Capital Holdings Corporation (available May 13, 1988), and
Shearman & Sterling (available July 2, 1993), and similar no-
action letters and (B) including a representation that none of
the Issuer or the Guarantors has entered into any arrangement or
understanding with any person to distribute the Exchange Notes to
be received in the Exchange Offer and that, to the best of each
of the Issuer's and the Guarantors' knowledge, each Holder
intending to participate in the Exchange Offer is acquiring the
Exchange Notes in its ordinary course of business and has no
arrangement or understanding with any person to participate in
the distribution of the Exchange Notes received in the Exchange
Offer.
(d) The Issuer and the Guarantors hereby agree for a period
of at least 180 days after consummation of the Exchange Offer to
make available, upon written request therefor, a prospectus
meeting the requirements of the Securities Act to any
Participating Broker-Dealer for use in connection with resales of
Exchange Notes. Upon consummation of the Exchange Offer in
accordance with this Agreement, the Issuer and the Guarantors
shall have no further obligation to register Transfer Restricted
Securities pursuant to Section 3 of this Agreement, unless the
Issuer and the Guarantors are otherwise obligated to file a Shelf
Registration Statement pursuant to Section 3 hereof.
(e) The Issuer and the Guarantors shall include within the
Prospectus contained in the Exchange Offer Registration Statement
a section entitled "Plan of Distribution," reasonably acceptable
to the Initial Purchasers, which shall contain a summary
statement of the positions taken or policies made by the staff of
the SEC with respect to the potential "underwriter" status of any
Participating Broker-Dealer with respect to the Exchange Notes.
Such "Plan of Distribution" section shall also allow the use of
the Prospectus by all persons subject to the prospectus delivery
requirements of the Securities Act, including all Participating
Broker-Dealers, and include a
statement describing the means by which Participating Broker-
Dealers may resell the Exchange Notes.
(f) The Issuer and the Guarantors shall use their best
efforts to keep the Exchange Offer Registration Statement
effective and to amend and supplement the Prospectus contained
therein, in order to permit such Prospectus to be lawfully
delivered by all persons subject to the prospectus delivery
requirements of the Securities Act for such period of time as
such persons must comply with such requirements in order to
resell the Exchange Notes; provided that such period shall not
exceed 180 days after consummation of the Exchange Offer (or such
longer period if extended pursuant to Section 5(j) hereof) (the
"Applicable Period").
In connection with the Exchange Offer, the Issuer and the
Guarantors shall:
(i) mail as promptly as practicable to each Holder a
copy of the Prospectus forming part of the Exchange Offer
Registration Statement, together with an appropriate letter
of transmittal and related documents;
(ii) utilize the services of a depositary for the
Exchange Offer with an address in the Borough of Manhattan,
The City of New York; and
(iii) permit Holders to withdraw tendered Initial
Notes at any time prior to the close of business, New York
time, on the last Business Day on which the Exchange Offer
shall remain open by sending to the institution and at the
address (located in the Borough of Manhattan, The City of
New York) specified in the notice, a telegram, telex,
facsimile transmission or letter setting forth the name of
such Holder, the principal amount of Transfer Restricted
Securities delivered for exchange and a statement that such
Holder is withdrawing his or her election to have such
Transfer Restricted Securities exchanged.
As soon as practicable after the close of the Exchange
Offer, the Issuer and the Guarantors shall:
(i) accept for exchange all Initial Notes validly
tendered and not validly withdrawn in accordance with the
Exchange Offer;
(ii) deliver, or cause to be delivered, to the Trustee
for cancellation all Initial Notes so accepted for exchange;
and
(iii) cause the Trustee to authenticate and deliver
promptly to each Holder of Initial Notes, Exchange Notes
equal in principal amount to the Initial Notes of such
Holder so accepted for exchange.
(g) If (1) prior to the consummation of the Exchange Offer,
applicable interpretations of the staff of the SEC do not permit
the Issuer and the Guarantors to effect the Exchange Offer,
(2) for any other reason the Exchange Offer is not consummated on
or prior to the Effectiveness Target Date, or (3) any Holder of
Transfer Restricted Securities shall notify the Issuer within 20
Business Days of the consummation of the Exchange Offer (and
confirm such notice in writing
within five Business Days thereafter) that such Holder is a
Direct Broker-Dealer Buyer, then the Issuer and the Guarantors
shall promptly deliver to the Holders of any Transfer Restricted
Securities and the Trustee written notice thereof (the "Shelf
Notice"), and the Issuer and the Guarantors shall file a
Registration Statement pursuant to Section 3 hereof. Following
the delivery to the Holders of Transfer Restricted Securities of
a Shelf Notice, the Issuer and the Guarantors shall not have any
further obligation to conduct the Exchange Offer pursuant to this
Section 2(g), provided, that the Issuer and the Guarantors shall
have the right, nonetheless, to proceed to consummate the
Exchange Offer notwithstanding their obligation pursuant to this
Section 2(g) (and, upon such consummation, any obligation to file
a Shelf Registration Statement arising from clause (1) or (2)
(but not clause (3)) of this Section 2(g) shall terminate) and
provided that any Shelf Notice delivered to the Holders of
Transfer Restricted Securities pursuant to clause (3) of this
Section 2(g) shall result in the termination of the obligations
of the Issuer and the Guarantors to conduct the Exchange Offer
only with respect to the Holders described in clause (3) of this
Section 2(g).
3. Shelf Registration Statement
If the Issuer and the Guarantors are required to deliver a
Shelf Notice as contemplated by Section 2(g) hereof, then:
(a) Shelf Registration Statement. The Issuer and the
Guarantors shall prepare and file with the SEC, as promptly as
practicable following the Shelf Notice, a Registration Statement
for an offering to be made on a continuous basis pursuant to Rule
415 covering all of the Transfer Restricted Securities, which
registration statement, if the Shelf Notice is given pursuant to
Section 2(g)(1) or (2), may be an amendment to the Exchange Offer
Registration Statement (the "Shelf Registration Statement"). The
Shelf Registration Statement shall be on Form S-1 or another
appropriate form permitting registration of the Transfer
Restricted Securities for resale by the Holders in the manner or
manners reasonably designated by them (including, without
limitation, one or more underwritten offerings). The Issuer and
the Guarantors shall not permit any securities other than the
Transfer Restricted Securities to be included in the Shelf
Registration Statement. The Issuer and the Guarantors shall use
their best efforts, as described in Section 5(b) hereof, to cause
the Shelf Registration Statement to be declared effective
pursuant to the Securities Act as promptly as practicable after
the filing of such Shelf Registration Statement, but in no event
later than the Effectiveness Target Date (or in the case of a
Shelf Registration Statement filed pursuant to Section 2(g)(3)
hereof, by the later of the Effectiveness Target Date or 60 days
of receipt by the Issuer of the notice contemplated by
Section 2g)(3)), and to keep the Shelf Registration Statement
continuously effective under the Securities Act until the earlier
of (i) the date which is 24 months after the Closing Date,
(ii) the date that all Transfer Restricted Securities covered by
the Shelf Registration Statement have been sold in the manner set
forth and as contemplated in the Shelf Registration Statement or
(iii) the date that there ceases to be securities outstanding
that constitute Transfer Restricted Securities (the
"Effectiveness Period").
(b) Supplements and Amendments. The Issuer and the
Guarantors shall use their best efforts to keep the Shelf
Registration Statement continuously effective by supplementing
and amending the Shelf Registration Statement if required by the
rules, regulations or instructions
applicable to the registration form used for such Shelf
Registration Statement, if required by the Securities Act, or if
reasonably requested by the Holders of a majority in aggregate
principal amount of the Transfer Restricted Securities covered by
such Registration Statement or by any underwriter of such
Transfer Restricted Securities.
4. Liquidated Damages
(a) The Issuer, the Guarantors and the Initial Purchasers
agree that the Holders of Transfer Restricted Securities will
suffer damages if the Issuer and the Guarantors fail to fulfill
their obligations pursuant to Section 2 or Section 3 hereof and
that it would not be possible to ascertain the extent of such
damages. Accordingly, in the event of such failure by the Issuer
and the Guarantors to fulfill such obligations, the Issuer agrees
to pay liquidated damages ("Liquidated Damages") to each Holder
of Transfer Restricted Securities under the circumstances and to
the extent set forth below:
(i) if neither the Exchange Offer Registration
Statement nor the Shelf Registration Statement has been
filed with the SEC on or prior to the Filing Date; or
(ii) if neither the Exchange Offer Registration
Statement nor the Shelf Registration Statement is declared
effective by the SEC on or prior to the Effectiveness Target
Date; or
(iii) if an Exchange Offer Registration Statement
is declared effective by the SEC, and on or prior to the
earlier of (A) 45 days following the effectiveness thereof
or (B) the Effectiveness Target Date, the Issuer and the
Guarantors have not exchanged Exchange Notes for all Initial
Notes validly tendered in accordance with the terms of the
Exchange Offer; or
(iv) the Shelf Registration Statement has been declared
effective by the SEC and such Shelf Registration Statement
ceases to be effective or usable at any time during the
Effectiveness Period;
(any of the foregoing, a "Registration Default"), then,
during the first 90-day period following such Registration
Default, the Issuer shall pay to each Holder of Transfer
Restricted Securities, accruing from the date of the first
such Registration Default (or if such Registration Default
has been cured, from the date of the next Registration
Default), Liquidated Damages in an amount equal to one-half
of one percent (0.5%) per annum of the principal amount of
Transfer Restricted Securities held by such Holder during
the first 90-day period immediately following the occurrence
of such Registration Default.
The amount of such Liquidated Damages will increase by an
additional one-half of one percent (0.5%) per annum of the
principal amount of Transfer Restricted Securities during each
subsequent 90-day period until all Registration Defaults have
been cured; provided, however, that Liquidated Damages shall not
at any time exceed two percent (2.0%) per annum of the principal
amount of Transfer Restricted Securities (regardless of whether
one or more than one
Registration Defaults has occurred and is continuing). Following
the cure of all Registration Defaults relating to any Transfer
Restricted Securities, the accrual of Liquidated Damages with
respect to such Transfer Restricted Securities will cease. A
Registration Default under clause (i) above shall be cured on the
date that either the Exchange Offer Registration Statement or the
Shelf Registration Statement is filed with the SEC; a
Registration Default under clause (ii) above shall be cured on
the date that either the Exchange Offer Registration Statement or
the Shelf Registration Statement is declared effective by the
SEC; a Registration Default under clause (iii) above shall be
cured on the earlier of the date (A) the Exchange Offer is
consummated or (B) a Shelf Registration Statement is declared
effective; and a Registration Default under clause (iv) above
shall be cured on the earlier of (A) the date that the post-
effective amendment curing the deficiency in the Shelf
Registration Statement is declared effective or (B) the
Effectiveness Period expires.
(b) The Issuer and the Guarantors shall notify the Trustee
within one Business Day after each and every date on which a
Registration Default first occurs. Payment of Liquidated
Damages, if any, will initially be due at the offices of the
Paying Agent (as defined in the Indenture), provided that, at the
option of the Issuer and the Guarantors, Liquidated Damages may
be paid by check mailed to Holders at their registered addresses,
provided further that (i) all payments with respect to Global
Notes (as defined in the Indenture) are required to be made in
same day funds in accordance with the policies of the Depository
(as defined in the Indenture) and (ii) all payments with respect
to Notes, the Holders of which have given wire transfer
instructions to the Issuers and the Guarantors, will be required
to be made by wire transfer of immediately available funds to the
accounts specified by such Holders. Liquidated Damages shall be
paid on or before the semi-annual interest payment date provided
in the Indenture and on each payment date provided in the
Indenture including, without limitation, whether upon redemption,
maturity (by acceleration or otherwise) or purchase upon a Change
of Control. Each obligation to pay Liquidated Damages shall be
deemed to commence accruing on the date of the applicable
Registration Default and to cease accruing when all Registration
Defaults have been cured. In no event shall the Issuer pay
Liquidated Damages in excess of the applicable maximum amount set
forth above, regardless of whether one or multiple Registration
Defaults exist.
(c) The parties hereto agree that the Liquidated Damages
provided for in this Section 4 constitute a reasonable estimate
of the damages that will be suffered by Holders by reason of the
failure to file the Exchange Offer Registration Statement or the
Shelf Registration Statement, the failure of the Exchange Offer
Registration Statement or the Shelf Registration Statement to be
declared effective, the failure to consummate the Exchange Offer
or the failure of the Shelf Registration Statement to remain
effective, as the case may be, in accordance with this Agreement.
(d) The Issuer hereby designates, with respect to each Gem
Note (as defined in the Indenture), all Liquidated Damages, if
any, payable hereunder as "Senior Indebtedness," as such term is
defined in such Gem Note.
5.
Registration Procedures
In connection with the registration of any Exchange Notes or
Transfer Restricted Securities pursuant to Sections 2 or 3
hereof, the Issuer and the Guarantors shall effect such
registration to permit the exchange of such Exchange Notes for
Initial Notes or the sale of such Transfer Restricted Securities
(as applicable), in accordance with the intended method or
methods of exchange or disposition thereof, and pursuant thereto
the Issuer and the Guarantors shall:
(a) prepare and file with the SEC a Registration Statement
or Registration Statements as prescribed by Section 2 or
Section 3 hereof, and use their best efforts to cause such
Registration Statement to become effective and remain effective
as provided herein; provided that, if (1) such filing is pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof
is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, before filing any Registration
Statement or Prospectus or any amendments or supplements thereto,
the Issuer and the Guarantors shall furnish to and afford the
Holders of the Transfer Restricted Securities and each such
Participating Broker-Dealer, as the case may be, covered by such
Registration Statement, their counsel and the managing
underwriters, if any, a reasonable opportunity to review copies
of all such documents (including copies of any documents to be
incorporated by reference therein and all exhibits thereto),
proposed to be filed (at least 5 Business Days prior to such
filing, or such later date as is reasonable under the
circumstances). The Issuer and the Guarantors shall not file any
Registration Statement or Prospectus or any amendments or
supplements thereto in respect of which the Holders, pursuant to
this Agreement, must be afforded an opportunity to review prior
to the filing of such document, if the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities
covered by such Registration Statement, or such Participating
Broker-Dealer, as the case may be, their counsel, or the managing
underwriters, if any, shall reasonably object on a timely basis
(except that documents filed as exhibits that are incorporated by
reference or deemed to be incorporated by reference shall not be
subject to such objections);
(b) prepare and file with the SEC such amendments and post-
effective amendments to each Shelf Registration Statement or
Exchange Offer Registration Statement, as the case may be, as may
be necessary to keep such Registration Statement continuously
effective for the Effectiveness Period or the Applicable Period,
as the case may be, or such shorter period as will terminate when
all Transfer Restricted Securities covered by such Registration
Statement have been sold; cause the related Prospectus to be
supplemented by any required prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 (or any similar
provisions then in force), under the Securities Act; and comply
with the provisions of the Securities Act, the Exchange Act and
the rules and regulations of the SEC promulgated thereunder with
respect to the disposition of all securities covered by such
Registration Statement, as so amended, or in such Prospectus, as
so supplemented, and with respect to the subsequent resale of any
Initial Notes being sold by a Participating Broker-Dealer covered
by any such Prospectus; the Issuer and the Guarantors shall be
deemed not to have used their best efforts to keep a Registration
Statement effective during the Applicable Period or the
Effectiveness Period or otherwise when required to use their best
efforts under Sections 2, 3 and 5 hereof if any of the Issuer or
any of the Guarantors
voluntarily takes any action that would result in selling Holders
of the Transfer Restricted Securities covered thereby or
Participating Broker-Dealers seeking to sell Exchange Notes not
being able to sell such Transfer Restricted Securities or such
Exchange Notes during that period, unless (i) such action is
required by applicable law, or (ii) such action is taken by it in
good faith and for valid business reasons (not including
avoidance of its obligations hereunder), including the
acquisition or divestiture of assets or the preservation of the
confidentiality of information the disclosure of which may have a
material adverse effect on the assets, business, financial
condition or prospects of the Issuer, the Guarantors and any
other direct or indirect subsidiary of the Issuer, taken as a
whole;
(c) if (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof
is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, notify the selling Holders of
Transfer Restricted Securities, or each known Participating
Broker-Dealer, as the case may be, their counsel and the managing
underwriters, if any, promptly and confirm such notice in
writing, (i) when a Prospectus, any prospectus supplement or post-
effective amendment has been filed, and, with respect to a
Registration Statement or any post-effective amendment, when the
same has become effective (including in such notice a written
statement that any Holder may, upon request, obtain, without
charge, one conformed copy of such Registration Statement or post-
effective amendment including financial statements and schedules,
documents incorporated or deemed to be incorporated by reference
and exhibits), (ii) of the issuance by the SEC of any stop order
suspending the effectiveness of a Registration Statement or of
any order preventing or suspending the use of any preliminary
prospectus or the initiation of any proceedings for that purpose,
(iii) if at any time when a Prospectus is required by the
Securities Act to be delivered in connection with sales of the
Transfer Restricted Securities the representations and warranties
of the Issuer and the Guarantors contained in any agreement
(including any underwriting agreement) contemplated by
Section 5(l) hereof cease to be true and correct in any material
respect, (iv) of the receipt by the Issuer or the Guarantors of
any notification with respect to the suspension of the
qualification or exemption from qualification of a Registration
Statement or any of the Transfer Restricted Securities or the
Exchange Notes to be sold by any Participating Broker-Dealer for
offer or sale in any jurisdiction, or the initiation of any
proceeding for such purpose, (v) of the happening of any event or
any information becoming known that makes any statement made in
such Registration Statement or related Prospectus or any document
incorporated or deemed to be incorporated therein by reference
untrue in any material respect or that requires the making of any
changes in such Registration Statement, Prospectus or documents
so that, in the case of the Registration Statement, it will not
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case
of the Prospectus, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading, and (vi) of the reasonable determination of the
Issuer or any Guarantor that a post-effective amendment to a
Registration Statement would be appropriate;
(d) if (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof
is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, use their best efforts to prevent
the issuance of any order suspending the effectiveness of a
Registration Statement or of any order preventing or suspending
the use of a Prospectus or suspending the qualification (or
exemption from qualification), of any of the Transfer Restricted
Securities or the Exchange Notes (as applicable), to be sold by
any Participating Broker-Dealer, for sale in any jurisdiction,
and, if any such order is issued, to use their best efforts to
obtain the withdrawal of any such order at the earliest possible
moment;
(e) if a Shelf Registration Statement is filed pursuant to
Section 3 hereof and if requested by the managing underwriters,
if any, or the Holders of a majority in aggregate principal
amount of the Transfer Restricted Securities being sold in
connection with an underwritten offering, (i) promptly
incorporate in a prospectus supplement or post-effective
amendment such information relating to underwriters, if any, any
Holder of Transfer Restricted Securities or the plan of
distribution of the Transfer Restricted Securities as the
managing underwriter, if any, or such Holders may reasonably
request to be included therein, (ii) make all required filings of
such prospectus supplement or such post-effective amendment as
soon as practicable after any of the Issuer and the Guarantors
has received notification of the matters to be incorporated in
such prospectus supplement or post-effective amendment pursuant
to clause (i), and (iii) supplement or make amendments to such
Registration Statement with such information as is required in
connection with any request made pursuant to clause (i);
(f) if (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof
is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, furnish to each selling Holder of
Transfer Restricted Securities and to each such Participating
Broker-Dealer who so requests and to counsel and each managing
underwriter, if any, without charge, one conformed copy of the
Registration Statement or Registration Statements and each post-
effective amendment thereto, including financial statements and
schedules, and, if requested, all documents incorporated or
deemed to be incorporated therein by reference and all exhibits;
(g) if (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof
is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, deliver to each selling Holder of
Transfer Restricted Securities, or each such Participating Broker-
Dealer, as the case may be, its counsel, and the underwriters, if
any, without charge, as many copies of the Prospectus or
Prospectuses (including each form of preliminary Prospectus), and
each amendment or supplement thereto and any documents
incorporated by reference therein, as such Persons may reasonably
request; and, subject to the last paragraph of this Section 5
hereof, the Issuer and the Guarantors hereby consent to the use
of such Prospectus and each amendment or supplement thereto by
each of the selling Holders of Transfer Restricted Securities or
each such Participating
Broker-Dealer, as the case may be, and their underwriters or
agents, if any, and dealers, if any, in connection with the
offering and sale of the Transfer Restricted Securities covered
by or the sale by Participating Broker-Dealers of the Exchange
Notes pursuant to such Prospectus and any amendment or supplement
thereto;
(h) prior to any public offering of Transfer Restricted
Securities or any delivery of a Prospectus contained in the
Exchange Offer Registration Statement by any Participating Broker-
Dealer who seeks to sell Exchange Notes during the Applicable
Period, to use their reasonable best efforts to register or
qualify, and to cooperate with the selling Holders of Transfer
Restricted Securities or each such Participating Broker-Dealer,
as the case may be, the underwriters, if any, and their
respective counsel in connection with the registration or
qualification (or exemption from such registration or
qualification), of such Transfer Restricted Securities for offer
and sale under the securities or Blue Sky laws of such
jurisdictions as any selling Holder, Participating Broker-Dealer,
or the managing underwriters reasonably request in writing; keep
each such registration or qualification (or exemption therefrom)
effective during the period such Registration Statement is
required to be kept effective and do any and all other acts or
things reasonably necessary or advisable to enable the
disposition in such jurisdictions of the Exchange Notes held by
Participating Broker-Dealers or the Transfer Restricted
Securities covered by the applicable Registration Statement;
provided that none of the Issuer or the Guarantors shall be
required to (A) qualify generally to do business in any
jurisdiction where it is not then so qualified, (B) take any
action that would subject it to general service of process in any
such jurisdiction where it is not then so subject or (C) subject
it to taxation in any such jurisdiction where it is not so
subject;
(i) if a Shelf Registration Statement is filed pursuant to
Section 3 hereof, cooperate with the selling Holders of Transfer
Restricted Securities and the managing underwriters, if any, to
facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold, which
certificates shall not bear any restrictive legends with respect
to transfer and shall be in a form eligible for deposit with The
Depository Trust Company, ("DTC"), and enable such Transfer
Restricted Securities to be in such denominations and registered
in such names as the managing underwriters, if any, or Holders
may reasonably request at least two Business Days prior to any
sale of the Transfer Restricted Securities;
(j) if (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof
is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, upon the occurrence of any event
contemplated by paragraph 5(c)(v) or 5(c)(vi) above, as promptly
as practicable prepare and (subject to Section 5(a) hereof) file
with the SEC, at the expense of the Issuer and the Guarantors, a
post-effective amendment to the Registration Statement or a
supplement to the related Prospectus or any document incorporated
or deemed to be incorporated therein by reference, or file any
other required document so that, as thereafter delivered to the
purchasers of the Transfer Restricted Securities being sold
thereunder or to the purchasers of the Exchange Notes to whom
such Prospectus will be delivered by a Participating Broker-
Dealer, any such Prospectus will not contain an untrue statement
of a material fact or omit to state a material fact required to
be stated
therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading;
provided, however, that:
(A) the Issuer and the Guarantors may delay such
preparation and filing of such supplement or post-
effective amendment pursuant to this Section 5(j) if
(i) such action is required by applicable law, or (ii)
such action is taken by them in good faith and for
valid business reasons (not including avoidance of
their obligations hereunder), including the acquisition
or divestiture of assets or the preservation of the
confidentiality of information the disclosure of which
may have a material adverse effect on the assets,
business, financial condition or prospects of the
Issuer, the Guarantors and any other direct or indirect
subsidiaries of the Issuer, taken as a whole (in any
such case, an "Amendment Delay");
(B) the Issuer and the Guarantors may effect, in the
aggregate, no more than one Amendment Delay during the
Applicable Period and such Amendment Delay shall be for
no longer than 45 Business Days;
(C) the Issuer and the Guarantors may effect, in the
aggregate, no more than two Amendment Delays during the
Effectiveness Period, provided that no more than one
Amendment Delay shall be effected during any twelve-
month period, and each such Amendment Delay shall be
for no longer than 45 Business Days; and
(D) to the extent that the Issuer and the Guarantors
effect one or more Amendment Delays, the duration of
the Effectiveness Period (if such duration is
determined pursuant to clause (i) of the definition
thereof) or the maximum duration of the Applicable
Period, as the case may be, shall be extended for the
aggregate amount of time that any such Amendment Delays
were in effect;
(k) prior to the effective date of the first Registration
Statement relating to the Transfer Restricted Securities,
(i) provide the Trustee with certificates for the Transfer
Restricted Securities in a form eligible for deposit with DTC and
(ii) use their best efforts to provide a CUSIP number for the
Transfer Restricted Securities;
(1) in connection with an underwritten offering of Transfer
Restricted Securities pursuant to a Shelf Registration Statement,
enter into an underwriting agreement as is customary in
underwritten offerings and take all such other actions as are
reasonably requested by the managing underwriters in order to
expedite or facilitate the registration or the disposition of
such Transfer Restricted Securities, and in such connection,
(i) make such representations and warranties to the underwriters,
with respect to the business of the Issuer and the Guarantors,
the Registration Statement, Prospectus and documents, if any,
incorporated or deemed to be incorporated by reference therein,
in each case, as are customarily made by issuers to underwriters
in underwritten offerings, and confirm the same if and when
requested; (ii) obtain opinions of counsel to the Issuer and the
Guarantors and updates thereof in form and substance reasonably
satisfactory to the managing underwriters, addressed to the
underwriters covering the matters customarily covered in opinions
requested in underwritten offerings and such other matters as
may be reasonably requested by underwriters; (iii) obtain "cold
comfort" letters and updates thereof in form and substance
reasonably satisfactory to the managing underwriters from the
Independent certified public accountants of the Issuer and the
Guarantors (and, if necessary, any other independent certified
public accountants with respect to any business for which
financial statements and financial data are, or are required to
be, included in the Registration Statement), addressed to each of
the underwriters, such letters to be in customary form and
covering matters of the type customarily covered in "cold
comfort" letters in connection with underwritten offerings and
such other matters as are reasonably requested by underwriters as
permitted by Statement on Auditing Standards No. 72; and (iv) if
an underwriting agreement is entered into, the same shall contain
indemnification provisions and procedures no less favorable than
those set forth in Section 7 hereof (or such other provisions and
procedures acceptable to Holders of a majority in aggregate
principal amount of outstanding Transfer Restricted Securities
covered by such Registration Statement and the managing
underwriters or agents), with respect to all parties to be
indemnified pursuant to said Section. The above shall be done at
each closing under such underwriting agreement, or as and to the
extent required thereunder;
(m) if (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange
Offer Registration Statement filed pursuant to Section 2 hereof
is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, make available for inspection by
any selling Holder of such Transfer Restricted Securities being
sold, or each such Participating Broker-Dealer, as the case may
be, any underwriter participating in any such disposition of
Transfer Restricted Securities, if any, and any attorney,
accountant or other agent retained by any such selling Holder or
each such Participating Broker-Dealer, as the case may be, or
underwriter (collectively, the "Inspectors"), at the offices
where normally kept, during reasonable business hours, all
financial and other records, pertinent corporate documents and
properties of the Issuer and the Guarantors (collectively, the
"Records"), solely as shall be reasonably necessary to enable
them to exercise any applicable due diligence responsibilities,
and cause the officers, directors and employees of the Issuer and
the Guarantors and any of their respective subsidiaries to supply
all information in each case reasonably requested by any such
Inspector in connection with such Registration Statement, subject
to such reasonable confidentiality requirements as the Issuer,
the Guarantors or any of their respective subsidiaries may impose
with respect thereto;
(n) provide an indenture trustee for the Transfer
Restricted Securities or the Exchange Notes, as the case may be,
and cause the Indenture to be qualified under the TIA not later
than the effective date of the Exchange Offer or the first
Registration Statement relating to the Transfer Restricted
Securities; and in connection therewith, cooperate with the
trustee under any such indenture and the Holders of the Transfer
Restricted Securities, to effect such changes to such indenture
as may be required for such indenture to be so qualified in
accordance with the terms of the TIA; and execute, and use their
best efforts to cause such trustee to execute, all customary
documents as may be required to effect such changes, and all
other forms and documents required to be filed with the SEC to
enable such indenture to be so qualified in a timely manner;
(o) comply with all applicable rules and regulations of the
SEC and, as soon as reasonably practicable, make generally
available to the holders of Exchange Notes and the Holders, if
any, consolidated earning statements of the Issuer that satisfy
the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder;
(p) If an Exchange Offer is to be consummated, upon
delivery of the Transfer Restricted Securities by Holders to the
Issuer or the Guarantors (or to such other Person as directed by
the Issuer and the Guarantors), in exchange for the Exchange
Notes, the Issuer or the Guarantors shall mark, or cause to be
marked, on such Transfer Restricted Securities that such Transfer
Restricted Securities are being cancelled in exchange for the
Exchange Notes; in no event shall such Transfer Restricted
Securities be marked as paid or otherwise satisfied.
(q) reasonably cooperate with each seller of Transfer
Restricted Securities covered by any Registration Statement and
each underwriter, if any, participating in the disposition of
such Transfer Restricted Securities and their respective counsel
in connection with any filings required to be made with the
National Association of Securities Dealers, Inc. (the "NASD");
(r) use their best efforts to take all other steps
necessary to effect the registration of the Transfer Restricted
Securities or the Exchange Notes covered by a Registration
Statement contemplated hereby; and
(s) use their best efforts to cause the Transfer Restricted
Securities or the Exchange Notes, as applicable, covered by an
effective registration statement required by Section 2 or
Section 3 hereof to be rated with the appropriate rating
agencies, if so requested by the Holders of a majority in
aggregate principal amount of Transfer Restricted Securities
relating to such registration statement or the managing
underwriters in connection therewith, if any.
The Issuer and the Guarantors may require each seller of
Transfer Restricted Securities or Participating Broker-Dealer as
to which any registration is being effected to furnish to the
Issuer and the Guarantors such information regarding such seller
or Participating Broker-Dealer and the distribution of such
Transfer Restricted Securities or Exchange Notes to be sold by
such Participating Broker-Dealer, as the case may be, as required
to be included in a Registration Statement prepared in accordance
with the Securities Act or as the Issuer and the Guarantors may,
from time to time, reasonably request. The Issuer and the
Guarantors may exclude from such registration the Transfer
Restricted Securities or Exchange Notes of any seller or
Participating Broker-Dealer, as the case may be, who fails to
furnish such information within a reasonable time after receiving
such request.
Each Holder of Transfer Restricted Securities and each
Participating Broker-Dealer agrees by acquisition of such
Transfer Restricted Securities or Exchange Notes to be sold by
such Participating Broker-Dealer, as the case may be, that, upon
receipt of' any notice from the Issuer of the happening of any
event of the kind described in Section 5(c)(ii), 5(c)(iv),
5(c)(v) or 5(c)(vi) hereof, such Holder shall forthwith
discontinue disposition of such Transfer Restricted Securities
covered by such Registration Statement or Prospectus or such
Exchange Notes to be sold by such Participating Broker-Dealer, as
the case may be, until such Holder's receipt of the
copies of the supplemented or amended Prospectus contemplated by
Section 5(j) hereof, or until it is advised in writing by the
Issuer that the use of the applicable Prospectus may be resumed,
and has received copies of any amendments or supplements thereto.
6. Registration Expenses
(a) All fees and expenses incident to the performance of or
compliance with this Agreement by the Issuer and the Guarantors
shall be borne by the Issuer and the Guarantors, whether or not
the Exchange Offer or a Shelf Registration Statement is filed or
becomes effective, including, without limitation, (i) all
registration and filing fees (including, without limitation,
(a) fees with respect to filings required to be made with the
NASD in connection with an underwritten offering and (b) fees and
expenses of compliance with state securities or Blue Sky laws
(including, without limitation, reasonable fees and disbursements
of counsel in connection with Blue Sky qualifications of the
Transfer Restricted Securities or Exchange Notes (x) where the
Holders of Transfer Restricted Securities are located, in the
case of the Exchange Notes, or (y) as provided in
Section 5(h) hereof, in the case of Transfer Restricted
Securities or Exchange Notes to be sold by a Participating Broker-
Dealer during the Applicable Period)), (ii) printing expenses
(including, without limitation, expenses of printing certificates
for Transfer Restricted Securities or Exchange Notes in a form
eligible for deposit with DTC and of printing Prospectuses if the
printing of Prospectuses is requested by the managing
underwriters, if any, or, in respect of Transfer Restricted
Securities or Exchange Notes to be sold by any Participating
Broker-Dealer during the Applicable Period, by the Holders of a
majority in aggregate principal amount of the Transfer Restricted
Securities included in any Registration Statement or of such
Exchange Notes, as the case may be), (iii) messenger, telephone
and delivery expenses, (iv) fees and disbursements of counsel for
the Issuer and the Guarantors, (v) fees and disbursements of all
independent certified public accountants referred to in
Section 5(l)(iii) hereof (including, without limitation, the
expenses of any special audit and "cold comfort" letters required
by or incident to such performance), (vi) rating agency fees,
(vii) Securities Act liability insurance, if the Issuer or any of
the Guarantors desires such insurance, (viii) fees and expenses
of all other Persons retained by the Issuer and the Guarantors,
(ix) internal expenses of the Issuer and the Guarantors
(including, without limitation, all salaries and expenses of
officers and employees of the Issuer and the Guarantors
performing legal or accounting duties), (x) the expense of any
annual audit and (xi) the fees and expenses incurred in
connection with the listing of the securities to be registered on
any securities exchange. Nothing contained in this Section 6
shall create an obligation on the part of the Issuer or any
Guarantor to pay or reimburse any Holder for any underwriting
commission or discount or accountable or non-accountable expense
reimbursement attributable to any such Holder's Transfer
Restricted Securities included in an underwritten offering
pursuant to a Registration Statement filed in accordance with the
terms of this Agreement, or to guarantee such Holder any profit
or proceeds from the sale of such Notes.
(b) In connection with any Shelf Registration Statement
hereunder, the Issuer and the Guarantors shall reimburse the
Holders of the Transfer Restricted Securities being registered in
such registration for the reasonable fees and disbursements of
not more than one counsel (in addition to appropriate local
counsel), chosen by the Holders of a majority in aggregate
principal amount of the Transfer Restricted Securities to be
included in such Registration Statement.
7.
Indemnification
The Issuer and the Guarantors agree to indemnify and hold
harmless (i) each Initial Purchaser or each Holder of Transfer
Restricted Securities, each initial Holder of Exchange Notes and
each Participating Broker-Dealer, (ii) each person, if any, who
controls (within the meaning of Section 15 of the Securities Act
or Section 20(a) of the Exchange Act), any such Person (any of
the persons referred to in this clause (ii) being hereinafter
referred to as a "controlling person"), and (iii) the respective
officers, directors, partners, employees, representatives and
agents of any of such Person or any controlling person (any
person referred to in clause (i), (ii) or (iii) may hereinafter
be referred to as an "Purchaser Indemnitee"), to the fullest
extent lawful, from and against any and all losses, claims,
damages, judgments, actions, out-of-pocket expenses, and other
liabilities (the "Liabilities"), including without limitation and
as incurred, reimbursement of all reasonable costs of
investigating, preparing, pursuing or defending any claim or
action, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, including the reasonable
fees and expenses of counsel to any Purchaser Indemnitee, joint
or several, directly or indirectly related to, based upon,
arising out of or in connection with any untrue statement or
alleged untrue statement of a material fact contained in any
Registration Statement or Prospectus (as amended or supplemented
if the Issuer and the Guarantors shall have furnished to such
Purchaser Indemnitee any amendments or supplements thereto), or
any preliminary prospectus, or any omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, except
insofar as such Liabilities arise out of or are based upon
(i) any untrue statement or omission or alleged untrue statement
or omission made in reliance upon and in conformity with
information relating to any Purchaser Indemnitee furnished to the
Issuer and the Guarantors or any underwriter in writing by such
Purchaser Indemnitee expressly for use therein, or (h) any untrue
statement contained in or omission from a preliminary prospectus
if a copy of the Prospectus (as then amended or supplemented, if
the Issuer and the Guarantors shall have furnished to or on
behalf of the Holder participating in the distribution relating
to the relevant Registration Statement any amendments or
supplements thereto) was not sent or given by or on behalf of
such Holder to the person asserting any such Liabilities who
purchased Initial Notes, if such Prospectus (or Prospectus as
amended or supplemented) is required by law to be sent or given
at or prior to the written confirmation of the sale of such
Initial Notes to such person and the untrue statement contained
in or omission from such preliminary prospectus was completely
corrected in the Prospectus (or the Prospectus as amended or
supplemented). The Issuer and the Guarantors shall notify the
Holders promptly of the institution, threat or assertion of any
claim, proceeding (including any governmental investigation), or
litigation of which it shall have become aware in connection with
the matters addressed by this Agreement which involves the
Issuer, the Guarantors or an Purchaser Indemnitee.
In connection with any Registration Statement in which a
Holder of Transfer Restricted Securities or a Participating
Broker-Dealer is participating, such Holder of Transfer
Restricted Securities or Participating Broker-Dealer agrees,
severally and not jointly, to indemnify and hold harmless the
Issuer, the Guarantors, each person who controls the Issuer or
any Guarantor within the meaning of Section 15 of the Securities
Act or Section 20(a) of the Exchange Act and the
respective partners, directors, officers, members,
representatives, employees and agents of such person or
controlling person to the same extent as the foregoing indemnity
from the Issuer and the Guarantors to each Purchaser Indemnitee,
but only with reference to information relating to such Purchaser
Indemnitee furnished to the Issuer or any Guarantor in writing by
such Purchaser Indemnitee expressly for use in any Registration
Statement or Prospectus, any amendment or supplement thereto, or
any preliminary Prospectus. The liability of any Purchaser
Indemnitee pursuant to this paragraph shall in no event exceed
the net proceeds received by such Purchaser Indemnitee from sales
of Transfer Restricted Securities giving rise to such
obligations.
If any suit, action, proceeding (including any governmental
or regulatory investigation), claim or demand shall be brought or
asserted against any person in respect of which indemnity may be
sought pursuant to either of the two preceding paragraphs, such
person (the "Indemnified Party"), shall promptly notify the
person against whom such indemnity may be sought (the
"Indemnifying Party"), in writing of the commencement thereof
(but the failure to so notify an Indemnifying Party shall not
relieve it from any liability which it may have under this
Section 7), and the Indemnifying Party, upon request of the
Indemnified Party, shall retain counsel reasonably satisfactory
to the Indemnified Party to represent the Indemnified Party and
any others the Indemnifying Party may reasonably designate in
such proceeding and shall pay the reasonable fees and expenses
actually incurred by such counsel related to such proceeding.
Notwithstanding the foregoing, in any such proceeding, any
Indemnified Party shall have the right to retain its own counsel,
but the fees and expenses of such counsel shall be at the expense
of such Indemnified Party, unless (i) the Indemnifying Party and
the Indemnified Party shall have mutually agreed in writing to
the contrary, (h) the Indemnifying Party failed within a
reasonable time after notice of commencement of the action to
assume the defense and employ counsel reasonably satisfactory to
the Indemnified Party or (iii) the named parties to any such
action (including any impleaded parties), include both such
Indemnified Party and the Indemnifying Party, or any affiliate of
the Indemnifying Party, and such Indemnified Party shall have
been reasonably advised by counsel that, either (x) there may be
one or more legal defenses available to it which are different
from or additional to those available to the Indemnifying Party
or such affiliate of the Indemnifying Party or (y) a conflict may
exist between such Indemnified Party and the Indemnifying Party
or such affiliate of the Indemnifying Party (in which case the
Indemnifying Party shall not have the right to assume the defense
of such action on behalf of such Indemnified Party, it being
understood, however, that the Indemnifying Party shall not, in
connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out
of the same general allegations or circumstances, be liable for
the fees and expenses of more than one separate firm of attorneys
(in addition to any local counsel), for all such indemnified
parties, which firm shall be designated in writing by those
indemnified parties who sold a majority in outstanding aggregate
principal amount of Transfer Restricted Securities sold by all
such indemnified parties and any such separate firm for the
Issuer and the Guarantors, the directors, the officers and such
control persons of the Issuer and the Guarantors as shall be
designated in writing by the Issuer and the Guarantors. The
Indemnifying Party shall not be liable for any settlement of any
proceeding effected without its written consent, which consent
shall not be unreasonably withheld, but if settled with such
consent or if there be a final judgment for the plaintiff, the
Indemnifying Party agrees to indemnify any Indemnified Party from
and against any loss or liability by reason of such
settlement or judgment. No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any
settlement of any pending or threatened proceeding in respect of
which any Indemnified Party is or could have been a party and
indemnity could have been sought hereunder by such Indemnified
Party, unless such settlement includes an unconditional release
of such Indemnified Party from all liability on claims that are
the subject matter of such proceeding.
If the indemnification provided for in the first and second
paragraphs of this Section 7 is for any reason held to be
unavailable to an Indemnified Party in respect of any Liabilities
referred to therein (other than by reason of the exceptions
provided therein) or is insufficient to hold harmless a party
indemnified thereunder, then each Indemnifying Party under such
paragraphs, in lieu of indemnifying such Indemnified Party
thereunder, shall contribute to the amount paid or payable by
such Indemnified Party as a result of such Liabilities (i) in
such proportion as is appropriate to reflect the relative
benefits of the Indemnified Party on the one hand and the
Indemnifying Party(ies) on the other in connection with the
statements or omissions that resulted in such Liabilities, or
(ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Indemnifying
Party(ies) and the Indemnified Party, as well as any other
relevant equitable considerations. The relative fault of the
Issuer and the Guarantors on the one hand and any Purchaser
Indemnitees on the other shall be determined by reference to,
among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the
Issuer and the Guarantors or by such Purchaser Indemnitees and
the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The parties agree that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by pro
rata allocation (even if such indemnified parties were treated as
one entity for such purpose), or by any other method of
allocation that does not take account of the equitable
considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Party as
a result of any Liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any reasonable legal or other
expenses actually incurred by such Indemnified Party in
connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this Section 7, in no
event shall a Purchaser Indemnitee be required to contribute any
amount in excess of the amount by which proceeds received by such
Purchaser Indemnitee from sales of Transfer Restricted Securities
or Exchange Notes exceeds the amount of any damages that such
Purchaser Indemnitee has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged
omission. For purposes of this Section 7, each person, if any,
who controls (within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act) an Initial Purchaser, a Holder
of Transfer Restricted Securities, an initial Holder of Exchange
Notes or a Participating Broker-Dealer shall have the same rights
to contribution as such Initial Purchaser, such Holder of
Transfer Restricted Securities, such initial Holder of Exchange
Notes or such Participating Broker-Dealer, as the case may be,
and each person, if any, who controls (within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act) the
Issuer, any Guarantor, and each officer, director, partner,
employee, representative, agent or manager of
each of the Issuer and the Guarantors shall have the same rights
to contribution as the Issuer and the Guarantors. Any party
entitled to contribution will, promptly after receipt of notice
of commencement of any action, suit or proceeding against such
party in respect of which a claim for contribution may be made
against another party or parties, notify each party or parties
from whom contribution may be sought, but the omission to so
notify such party or parties shall not relieve the party or
parties from whom contribution may be sought from any obligation
it or they may have under this Section 7 or otherwise. No person
guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act), shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation.
The indemnity and contribution agreements contained in this
Section 7 will be in addition to any liability which the
indemnifying parties may otherwise have to the indemnified
parties referred to above. The Purchaser Indemnitee's
obligations to contribute pursuant to this Section 7 are several
in proportion to the respective principal amount of Initial Notes
sold by each of the Purchaser Indemnitees hereunder and not
joint.
8. Rules 144 and 144A
Each of the Issuer and the Guarantors covenants that it will
file the reports, if any, required to be filed by it pursuant to
the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder in a timely manner and,
if at any time the Issuer or any Guarantor is not required to
file such reports, it will, upon the request of any Holder of
Transfer Restricted Securities, make available information with
respect to it required by Rule 144 and Rule 144A under the
Securities Act in order to permit sales pursuant to Rule 144 and
Rule 144A. The Issuer and the Guarantors further covenant that
they will take such further action as any Holder of Transfer
Restricted Securities may reasonably request, all to the extent
required from time to time to enable such Holder to sell Transfer
Restricted Securities without registration under the Securities
Act within the limitation of the exemptions provided by (a) Rule
144 and Rule 144A or (b) any similar rule or regulation hereafter
adopted by the SEC. The Issuer agrees to cause each Guarantor to
comply with its obligations, if any, hereunder.
9. Underwritten Registrations
(a) If any of the Transfer Restricted Securities covered by
any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker or investment
bankers and manager or managers that will manage the offering
will be selected by the Holders of a majority in aggregate
principal amount of such Transfer Restricted Securities included
in such offering and shall be reasonably acceptable to the Issuer
and the Guarantors.
No Holder of Transfer Restricted Securities may participate
in any underwritten registration hereunder, unless such Holder
(a) agrees to sell such Holder's Transfer Restricted Securities
on the basis provided in any underwriting arrangements approved
by the Persons entitled hereunder to approve such arrangements
and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other
documents required under the terms of such underwriting
arrangements.
(b) Each Holder of Transfer Restricted Securities agrees,
if requested (pursuant to a timely written notice), by the
managing underwriters in an underwritten offering or by a
placement agent in a private offering of the Issuer's debt
securities, not to effect any private sale or distribution
(including a sale pursuant to Rule 144(k) or Rule 144A under the
Securities Act, but excluding non-public sales to any of its
affiliates, officers, directors, employees and controlling
persons) of any of the Initial Notes except pursuant to an
Exchange Offer, other than in compliance with applicable
securities laws and in no event during the period beginning 10
days prior to, and ending 90 days after, the closing date of the
underwritten offering.
The foregoing provisions shall not apply to any Holder of
Transfer Restricted Securities if such Holder is prevented by
applicable statute or regulation from entering into any such
agreement.
10. Miscellaneous
(a) Remedies. In the event of a breach by the Issuer and
the Guarantors of any of their obligations under this Agreement,
each Holder of Transfer Restricted Securities and each
Participating Broker-Dealer holding Exchange Notes, in addition
to being entitled to exercise all rights provided herein, in the
Indenture or, in the case of the Initial Purchasers, in the
Purchase Agreement, or granted by law, including recovery of
damages, will be entitled to specific performance of its rights
under this Agreement. Subject to Section 4, the Issuer and the
Guarantors agree that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by any
of them of any of the provisions of this Agreement and hereby
further agree that, in the event of any action for specific
performance in respect of such breach, they shall waive the
defense that a remedy at law would be adequate.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be
amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given, unless
the Issuer and the Guarantors have obtained the written consent
of holders of at least a majority of the then outstanding
aggregate principal amount of Transfer Restricted Securities and
Exchange Notes held by Participating Broker-Dealers taken as one
class. Notwithstanding the foregoing, a waiver or consent to or
departure from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders and
Participating Broker-Dealers holding Exchange Notes whose
securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect, impair, limit or
compromise the rights of other Holders and Participating Broker-
Dealers holding Exchange Notes may be given by holders of at
least a majority in aggregate principal amount of the Transfer
Restricted Securities and Exchange Notes held by Participating
Broker-Dealers being sold by such Holders and Participating
Broker-Dealers pursuant to such Registration Statement; provided
that the provisions of this sentence may not be amended, modified
or supplemented except in accordance with the provisions of the
immediately preceding sentence.
(c) Notices. All notices and other communications
(including, without limitation, any notices or other
communications to the Trustee), provided for or permitted
hereunder shall be made in writing by hand-delivery, registered
first-class mail, next-day air courier or telecopier:
(i) if to a Holder of Transfer Restricted Securities,
at the most current address given by the Trustee to the
Issuer; and
(ii) if to the Issuer or any Guarantor, c/o Ameristar
Casinos, Inc., 3773 Howard Hughes Parkway, Suite 490 South,
Las Vegas, Nevada 89109, Attention: Thomas M. Steinbauer,
Senior Vice President and Chief Financial Officer, and Brian
E. Katz, Senior Vice President, telecopier: 702-369-8860.
All such notices and communications shall be deemed to have
been duly given: when delivered by hand, if personally
delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; one Business Day after being timely
delivered to a nationally recognized next-day air courier, if
made by next-day air courier; and when receipt is acknowledged by
the addressee, if telecopied on a Business Day on such Business
Day, if not on a Business Day, on the first Business Day
thereafter.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to
the Trustee under the Indenture at the address specified in such
Indenture.
(d) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and assigns of
each of the parties hereto, including, without limitation and
without the need for an express assignment or assumption,
subsequent Holders of Transfer Restricted Securities. The Issuer
and the Guarantors agree that the Holders of Transfer Restricted
Securities and Participating Broker-Dealers holding Exchange
Notes shall be third party beneficiaries to the agreements made
hereunder by the Initial Purchasers and the Issuer and the
Guarantors, and each Holder and Participating Broker-Dealer shall
have the right to enforce such agreements directly to the extent
it deems such enforcement necessary or advisable to protect its
rights hereunder; provided, however, that such Holder or
Participating Broker-Dealer fulfills all of its obligations
hereunder.
(e) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to
be an original and all of which taken together shall constitute
one and the same agreement.
(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise
affect the meaning hereof.
(g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE
STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY SUBMITS TO
THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE
BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT
SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN
RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT, AND IRREVOCABLY ACCEPTS FOR ITSELF
AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,
THE JURISDICTION OF THE AFORESAID COURTS. EACH OF THE PARTIES
HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION THAT IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY
CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(h) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions
set forth herein shall remain in full force and effect and shall
in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the
intention of the parties hereto that they would have executed the
remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid,
illegal, void or unenforceable.
(i) Entire Agreement. This Agreement, together with the
Purchase Agreement, is intended by the parties hereto as a final
expression of their agreement, and is intended to be a complete
and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein
and therein.
(j) Transfer Restricted Securities Held by the Issuer or
its Affiliates. Whenever the consent or approval of Holders of a
specified percentage of Transfer Restricted Securities is
required hereunder, Transfer Restricted Securities held by the
Issuer or its affiliates (as such term is defined in Rule 405
under the Securities Act), shall not be counted in determining
whether such consent or approval was given by the Holders of such
required percentage.
(k) Survival. This Agreement is intended to survive the
consummation of the transactions contemplated by the Purchase
Agreement. The indemnification and contribution obligations
under Section 7 of this Agreement shall survive the termination
of the Issuer's obligations under Sections 2 and 3 of this
Agreement.
(l) Liability of ACCBI. Notwithstanding any other
provision herein to the contrary, ACCBI shall have no obligation
or liability hereunder prior to the time, if at all, that this
Agreement shall have been approved by the Iowa Racing and Gaming
Commission.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
ISSUER
AMERISTAR CASINOS, INC.
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Senior Vice President
GUARANTORS
AMERISTAR CASINO COUNCIL
BLUFFS, INC.
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
A.C. FOOD SERVICES, INC.
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
AC HOTEL CORP.
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
AMERISTAR CASINO LAS VEGAS, INC.
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
AMERISTAR CASINO VICKSBURG, INC.
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
CACTUS PETE'S, INC.
By: /s/ Thomas M. Steinbauer
Name: Thomas M. Steinbauer
Title: Vice President
INITIAL PURCHASERS
BEAR, STEARNS & CO. INC.
By: /s/ J. Andrew Bugas
Name: J. Andrew Bugas
Title:Senior Managing Director
BT SECURITIES CORPORATION
By: /s/ Michael Apfel
Name: Michael Apfel
Title: Vice President
FIRST CHICAGO CAPITAL MARKETS,
INC.
By: /s/ C. Victor Manny
Name: C. Victor Manny
Title: Managing Director
FOR IMMEDIATE RELEASE:
CONTACT: TOM STEINBAUER, SENIOR VICE PRESIDENT OF FINANCE --
(702) 567-7000
DATE: JULY 24, 1997
AMERISTAR CASINOS COMPLETES NEW $125 MILLION BANK CREDIT FACILITY
AND SALE OF $100 MILLION SENIOR SUBORDINATED NOTES DUE 2004
LAS VEGAS -- Ameristar Casinos, Inc. announced today the July
15th completion of the refinancing of its long-term credit
facilities through a new $125 million revolving bank credit
facility with a syndicate of banks led by Wells Fargo Bank, N. A.
and the sale of $100 million of 10 1/2% Senior Subordinated Notes
due 2004 in a private placement to qualified institutional
buyers. The initial bank draw and the net proceeds from the sale
of the Senior Subordinated Notes are being used to reduce
existing bank debt and other long-term debt. Future borrowings
under the new bank credit facility will be used to fund a
substantial portion of the costs of completing the Company's
latest casino-hotel project, The Reserve Hotel & Casino in the
Henderson-Green Valley suburb of Las Vegas.
The Senior Subordinated Notes have not been registered under
the Securities Act of 1933, are subject to restrictions on
transfer and may not be offered or sold in the United States
absent registration or an applicable exemption from registration
requirements. The initial purchasers of the Senior Subordinated
Notes are relying on the exemption under Rule 144A in connection
with resales of the Notes.
Ameristar Casinos, Inc., a publicly traded company (Nasdaq-
NMS ticker symbol: ASCA) with a strong background in the gaming
and hospitality industry dating back to 1954, owns and operates
Cactus Petes Resort Casino and The Horseshu Hotel & Casino in
Jackpot, Nev., Ameristar Casino Vicksburg in Vicksburg, Miss.,
and Ameristar Casino Hotel Council Bluffs in Council Bluffs,
Iowa, across the Missouri River from Omaha, Neb. Ameristar also
owns The Reserve Hotel & Casino, under development in Henderson,
Nev. in metropolitan Las Vegas.
-- AMERISTAR CASINOS, INC. --
EXHIBIT 99.1
SUPPLEMENTAL AGREEEMENT OF AMERISTAR CASINOS, INC.
Ameristar Casinos, Inc. ("ACI" hereby agrees to furnish
supplementally to the Securities and Exchange Commission a
copy of any of the exhibits and schedules to Exhibit 4.1 to
ACI's Current Report on Form 8-K dated July 15, 1997,
relating to the refinancing of ACI's long-term debt. Such
Exhibit 4.1 includes a list setting forth a description of
the omitted exhibits and schedules.
