SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM T-3
FOR APPLICATIONS FOR
QUALIFICATION OF INDENTURE
____________________
HEMMETER ENTERPRISES, INC.
(Name of Applicant)
1700 Lincoln Avenue, 49th Floor
Denver, Colorado 80203
(address of principal Executive Offices)
____________________
SECURITIES TO BE ISSUED UNDER THE INDENTURE TO BE QUALIFIED
12% Senior Secured Pay-In-Kind Up to an aggregate
Notes due 2003 principal amount
(Title of class) of $56,000,000
(Amount)
Approximate date of proposed issuance: As soon as
practicable following the effective date hereof.
Alan L. Mayer
Senior Vice President, Chief Legal Officer and Secretary
Hemmeter Enterprises, Inc.
1700 Lincoln Avenue, 49th Floor
Denver, Colorado 80203
(Name and address of agent for service)
With a copy to:
Thomas J. Moore
LeBoeuf, Lamb, Greene & MacRae, L.L.P.
633 Seventeenth Street, Suite 2800
Denver, Colorado 80202
<PAGE>
Item 1. General Information.
(a) Form of organization: A corporation
(b) State of other sovereign power under the laws
of which organized: Delaware
Item 2. Securities Act Exemption.
On November 7, 1995, Hemmeter Enterprises, Inc. (the
"Company") and three of its wholly owned subsidiaries, BWBH,
Inc., BWCC, Inc. and Millsite 27, Inc. (the "Colorado
Subsidiaries"), commenced reorganization cases by filing
voluntary petitions for relief under Chapter 11 of the
Bankruptcy Code in the U.S. Bankruptcy Court for the District
of Delaware (the "Hemmeter Bankruptcy Cases"). On December
27, 1995, the venue of the Hemmeter Bankruptcy Cases was
transferred to the United States Bankruptcy Court for the
Eastern District of Louisiana (the "Bankruptcy Court"). On
April 8, 1996, the First Amended Joint Plan of Reorganization
of the Company and its Colorado Subsidiaries (the "Plan") was
confirmed by the Bankruptcy Court.
The securities consist of (i) $50,000,000 principal
amount of 12% Senior Secured Notes Pay-In-Kind Notes due 2003
to be issued by the Company (the "Notes"), and (ii) a
guarantee (the "Guarantee") of such Notes being issued by the
Colorado Subsidiaries and Silver Hawk Casino, Inc., a wholly
owned subsidiary of the Company. The Securities are to be
issued under an indenture (the "Indenture") between the
Company and Fleet National Bank, as Trustee (the "Trustee").
The Plan of Reorganization expressly provides for the issuance
of such Notes and Guarantees to certain of the creditors of
the Company and the Colorado Subsidiaries. In addition, the
Indenture provides that through and including June 1, 1997,
the Company may, in lieu of the payment of interest on the
Notes in cash, pay interest on the Notes through the issuance
of additional Notes ("Secondary Notes"). Thus up to
$6,000,000 in principal amount of Secondary Notes may be
issued under the Indenture.
The offer and sale of the Notes will not be
registered under the Securities Act of 1933, as amended (the
"Securities Act") in reliance upon an exemption from Section 5
thereof provided by Section 1145 of the Bankruptcy Code.
Section 1145 of the Bankruptcy Code, generally, exempts from
such registration requirements the offer and sale of
securities of a debtor or, a successor to the debtor under a
plan of reorganization in the event such securities are
offered or sold in exchange for a claim against or interest in
such debtor, of if such securities are offered or sold
principally in such exchange and partly for cash.
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Item 3. Affiliates.
A. The names of the current affiliates of the Company
are as follows:
1. Subsidiaries of the Company
BWBH, Inc.
BWCC, Inc.
Millsite 27, Inc.
Silver Hawk Casino, Inc.
HEI - Mexico, Inc.
Michigan City Casino & Lodge, Inc.
HEDC, Inc.
2. 10% or Greater Stockholders:
Christopher B. Hemmeter
Daniel P. Robinowitz
B. As of the effective date of the Plan, the names of
the affiliates of the Company will be as follows:
1. Subsidiaries of the Company
BWBH, Inc.
BWCC, Inc.
Millsite 27, Inc.
Silver Hawk Casino, Inc.
HEI - Mexico, Inc.
Michigan City Casino & Lodge, Inc.
HEDC, Inc.
2. Based on the proofs of claim filed in the
Hemmeter Bankruptcy Cases, the Company believes the following
groups of affiliated entities will beneficially own 10% or
more of the Company's common stock on the effective date of
the Plan. The Company has been informed that these entities
do not believe they will control the Company as a result of
their share ownership and thus will not be affiliates as
defined in Reg. Section 260.0-2 of the General Rules and
Regulations of the Trust Indenture Act of 1939, as amended:
(a) Keystone High Income Bond Fund (B-4)
Keystone Strategic Income Fund
Keystone Small Company Growth Fund (S-4)
Equifax Inc. U.S. Retirement Income Plan
Trust
Ampex Retirement Master Trust
Buffalo Color Master Trust
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(b) Restart Partners
Restart Partners II LP
Restart Partners III LP
Restart Partners IV LP
Restart Partners V LP
Morgens Waterfall Income Partners
MW Employee Retirement Trust
The Common Fund
(c) PaineWebber Strategic Income Fund
Managed High Yield Fund Inc.
PaineWebber High Income Fund
All-American Term Trust Inc.
PaineWebber Offshore Funds, plc - The High
Income Fund
(d) SC Fundamental Value Fund LP
SC Fundamental Value Fund BVI, Limited
Item 4. Directors and Executive Officers
Set forth below is a list of all directors and
executive officers of the Company and all persons chosen to
become directors or executive officers.
Name Office Held or To Be Held
Stephen J. Szapor, Jr. Chief Executive Officer,
President and Director*
Alan L. Mayer Senior Vice President, Chief
Legal Officer and
Secretary<F1>
Richard S. Rabin Senior Vice President of
Operations<F1>
Robert Stephens Chief Accounting Officer and
Treasurer
Franklin S. Wimer Director<F1>
Steven Leonard Director<F1>
Mark Van Hartesvelt Director<F1>
The complete mailing address of each director and executive
officer of the Company is c/o Hemmeter Enterprises, 1700
Lincoln Avenue, 49th Floor, Denver, Colorado 80203.
____________________
<F1> Because each of the Company's directors must obtain a key
license from the Colorado Division of Gaming, the Company
will operate with an interim board consisting of Messrs.
Szapor, Mayer and Rabin, until such time as Messrs.
Wimer, Leonard and Van Hartesvelt obtain such licenses.
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Item 5. Principal owners of voting securities:
A. As of May 30, 1996:
Percentage of
Title of Voting
Name and Complete Class Securities
Mailing Address Owned Amount Owned
_______________ _____ ______ _____
Christopher B. Hemmeter
2090 Sunrise Hill
Los Angeles, CA 90049 common 7,698,088 65.6%
Daniel P. Robinowitz
4016 McFarlin Blvd.
Dallas, TX 75205 common 1,605,739 13.7%
B. As of the effective date of the Plan: Pursuant to
the Plan, all shares of common stock of the Company
outstanding immediately prior to the effective date of the
Plan will be cancelled and approximately 5 million shares of
newly issued common stock of the Company (the "New Common
Stock") will be issued pro rata to the holders of outstanding
notes of the Company (the "Old Notes"). The New Common Stock
will be the only authorized class of capital stock of the
Company. Because the Old Notes are primarily held in the
names of nominees, the Company is unable to determine the
identity of the Old Note holders directly. The only source of
information available to the Company concerning the identity
of the Old Note holders are the proofs of claim filed in the
Hemmeter Bankruptcy Cases. Set forth below is certain
information regarding each person who, based on those proofs
of claim, will be the beneficial owner of more than 10% of the
New Common Stock on the effective date of the Plan, determined
after giving effect to the cancellation of existing shares and
the issuance of shares of New Common Stock on the effective
date of the Plan:
Percentage
Title of of Voting
Name and Complete Class Securities
Mailing Address Owned Amount Owned
_______________ _____ ______ _____
Keystone High Income Bond Fund
(B-4) common 477,916 8.6%
Keystone Strategic Income Fund common 195,874 3.5
Keystone Small Company Growth
Fund (S-4) common 494,094 8.9
Equifax Inc. U.S. Retirement
Income Plan Trust common 26,469 *
Ampex Retirement Master Trust common 11,782 *
Buffalo Color Master Trust common 1,435 *
200 Berkeley Street
Boston, MA 02116
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Restart Partners common 226,877 4.1
Restart Partners II LP common 324,559 5.8
Restart Partners III LP common 224,680 4.0
Restart Partners IV LP common 143,275 2.6
Restart Partners V LP common 57,387 1.0
Morgens Waterfall Income
Partners common 36,902 *
MW Employee Retirement Trust common 6,769 *
The Common Fund common 71,816 1.3
10 E. 50th Street, Suite 2600
New York, NY 10022
PaineWebber Strategic Income
Fund common 13,911 *
Managed High Yield Fund Inc. common 83,394 1.5
PaineWebber High Income Fund common 768,694 13.8
All-American Term Trust Inc. common 73,300 1.3
PaineWebber Offshore Funds, plc
- The High Income Fund common 50,025 *
1285 Avenue of the Americas,
15th floor
New York, NY 10010
SC Fundamental Value Fund LP common 416,311 7.5
SC Fundamental Value Fund BVI,
Limited common 185,076 3.3
712 Fifth Avenue
New York, NY 10019
* Less then 1%.
UNDERWRITERS
Item 6. Underwriters.
(a) Within three years prior to the date of the
filing of this Application of Form T-3, no person acted as an
underwriter of any securities of the Company which are
currently outstanding.
(b) None.
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CAPITAL SECURITIES
Item 7. Capitalization.
A. As of May 30, 1996, the authorized and outstanding
amounts of classes of securities of the Company were as
follows:
Amount Amount
Title of Class Authorized Outstanding
Common Stock, par value
$.01 per share . . . . 50,000,000 11,731,235
Preferred Stock . . . . 2,000,000 None
B. On the effective date of the Plan, the authorized
and projected outstanding amounts of classes of securities of
the Company will be as follows:
Amount Amount
Title of Class Authorized Outstanding
Common Stock, par value
$.01 per share . . . . 20,000,000 5,138,888
INDENTURE SECURITIES
Item 8. Analysis of Indenture Provisions.
The following summaries of certain provisions of the
Indenture do not purport to be complete and are subject to,
and are qualified in their entirety by reference to, the Act,
and all the provisions of the Indenture, including the
definitions therein of certain terms which are not otherwise
defined in this Application on Form T-3 and those terms made a
part of the Indenture by reference to the Act. Wherever
particular provisions or defined terms of the Indenture (or of
the form of Notes which is a part thereof) are referred to,
such provisions or defined terms are incorporated herein by
reference.
The following are Events of Default under the
Indenture:
(a) the default in the payment of any interest on
any Note when it becomes due and payable and the
continuance of any such default for a period of ten (10)
days; or
(b) the default in the payment of the principal of
or premium, if any, on any Note when due at maturity,
upon acceleration, mandatory redemption, optional
redemption, required purchase or otherwise; or
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(c) the failure by the Company to own directly or
through wholly owned Company Subsidiaries subject to
certain exceptions, 100% of the Voting Stock of all
Company Subsidiaries, the failure by the Company to
maintain the required Consolidated Fixed Charges Coverage
Ratio at the required level or if the Company or any
Company Subsidiary modifies any agreement with
Christopher B. Hemmeter or Mark M. Hemmeter existing as
of the Issue Date or enters into any additional agreement
after the Issue Date with either Person.
(d) default in the performance, or breach of any
covenant or warranty of the Company or any Company
Subsidiary in the Indenture, or by the Company or any
Guarantor under any other Noteholder Document, or by any
Guarantor under its Guarantee (other than defaults
otherwise specified in this section), and the continuance
of such default or breach for a period of thirty (30)
days after written notice to the Company by the Trustee
or to the Company and the Trustee by the holders of at
least 25% in aggregate principal amount of the
outstanding New Notes; or
(e) failure by the Company or any Company
Subsidiary to make any payment when due or within
applicable grace periods with respect to any other
Indebtedness to the extent that all such payments then
due aggregate the principal amount of $1 million or more;
or
(f) a final judgment for the payment of money in
excess of $1 million shall be entered against the
Company, any Guarantor or any Company Subsidiary and
remaining undischarged for a period of thirty (30) days;
or
(g) any warrant of attachment in an amount of $1
million or more shall be issued against any portion of
the property or assets of the Company, any Guarantor or
any Company Subsidiary; or
(h) certain events of bankruptcy, insolvency or
reorganization with respect to the Company or any Company
Subsidiary shall have occurred; or
(i) any Noteholder Document ceases to be in full
force and effect or any Noteholder Documents ceases to
create in favor of the Trustee, with respect to any
portion of the Collateral, a valid and perfected Lien on
the Collateral (subject only to Permitted Liens)
purported to be covered thereby; or
(j) any Guarantee of a Guarantor is determined by a
court of competent jurisdiction to be null and void with
respect to such Guarantor or any Guarantor denies that it
has any further liability under its Guarantee or gives
notice to such effect; or
(k) the cessation of substantially all gaming
operations at any Gaming Facility which has commenced
operations, other than the Central City Casino, for more
than 45 days, except as a result of an Event of Loss (or
90 days in the case of
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cessation as a result of renovations to or construction
at or adjacent to such Gaming Facility); or
(l) the revocation, suspension or involuntary loss
of the legal right to operate any Gaming Facility which
continues for more than 45 days; or
(m) the Company ceases to own 100% of the Voting
Stock of BWBH, Inc., sells the Black Hawk Casino or all
or a significant portion of BWBH, Inc.'s assets or
properties, the occurrence of a Restricted Asset Sale
involving assets or property owned or leased by BWBH,
Inc. or used by BWBH, Inc. in the operation of the Black
Hawk Casino, or certain Events of Loss occur with respect
to the Black Hawk Casino or BWBH, Inc.
The Company is required to deliver to the Trustee on
or before the date which is 45 days after the end of each of
the first three fiscal quarter of the Company's fiscal year
and on or before the date which is 90 days after the end of
each fiscal year of the Company, an officer's certificate
stating whether or not any Default or Event of Default has
occurred. Within 45 days after the occurrence of any Default,
unless such Default shall have been cured or waived, the
Trustee must deliver notice of such Default known to the
Trustee to all Holders. Except in the case of a Default
specified in clauses (a) or (b) above, the Trustee may
withhold such notice if and so long as it determines in good
faith that withholding such notice is in the interest of the
Holders.
If an Event of Default (other than an Event of
Default specified in clause (h) above) occurs, the Trustee or
the Holders of at least 25% in principal amount of the
outstanding Notes may, by written notice, declare the
principal of, premium, if any, and accrued interest on all the
New Notes to be immediately due and payable. If an Event of
Default specified in clause (h) occurs, then the principal of
and accrued interest 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 Holder.
After a declaration of acceleration, the Holders of
a majority in principal amount of Outstanding Notes may, by
notice to the Company and the Trustee, rescind such
declaration of acceleration if (a) the Company has deposited
with the Trustee a sum sufficient to pay the unpaid principal
of (and premium, if any, on) the Notes, all overdue interest
on the Notes (including interest on overdue interest), and the
Trustee's reasonable expenses, (b) all existing Events of
Default have been cured or waived, other than nonpayment of
principal of and interest on the Notes due solely by such
acceleration, and (c) the rescission of acceleration would not
conflict with any judgment or decree.
Notwithstanding the preceding paragraph, in the
event of a declaration of acceleration in respect of the Notes
because of an Event of Default specified in clause (e), such
declaration of acceleration shall be automatically annulled if
(i) the Indebtedness that is the subject of such Event of
Default has been discharged or the holders thereof have waived
the default and rescinded their declaration of acceleration in
respect of such Indebtedness,
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(ii) the Company shall have given notice of such discharge to
the Trustee (countersigned by the holders of such Indebtedness)
within 30 days after such declaration of acceleration in respect
of the Notes, and (iii) no other Event of Default has occurred
during such 30 day period which has not been cured or waived.
Upon the occurrence of an Event of Default which is
continuing, the Trustee may, or at the direction of the
Holders of at least 25% in principal amount of the outstanding
Notes shall, initiate suit for collection of the amounts due
under the New Notes and the Guarantees, exercise all rights
and remedies in respect of the Collateral pursuant to the
Noteholder Documents or otherwise exercise any rights and
remedies available to it under the Indenture or otherwise.
No Holder of any of the Notes has any right to
institute any proceeding with respect to the Indenture or any
remedy thereunder, unless the Holders of at least 25% in
principal amount of the outstanding Notes have made written
request, and offered reasonable indemnity, to the Trustee to
institute such proceeding as Trustee, the Trustee has failed
to institute such proceeding within 15 days after receipt of
such notice and the Trustee has not within such 15-day period
received directions inconsistent with such written request by
Holders of a majority in principal amount of the outstanding
Notes. Such limitations do not apply, however, to a suit
instituted by a Holder for the enforcement of the payment of
the principal of, premium, if any, or accrued interest on,
such Note on or after the respective due dates expressed in
such Note.
During the existence of an Event of Default, the
Trustee is required to exercise such rights and powers vested
in it under the Indenture and use the same degree of care and
skill in its exercise thereof as a prudent Person would
exercise under the circumstances in the conduct of such
Person's own affairs. Subject to the provisions of the
Indenture relating to the duties of the Trustee, in case an
Event of Default shall occur and be continuing, the Trustee is
not under any obligation to exercise any of its rights or
powers under the Indenture at the request or direction of any
of the holders unless such holders shall have offered to such
Trustee reasonable security or indemnity. Subject to certain
provisions concerning the rights of the Trustee, the holders
of a majority in principal amount of the outstanding New Notes
have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the
Trustee exercising any trust or power conferred on the
Trustee.
(B) Authentication and Delivery; Application of
Proceeds.
No Note shall be valid until an authorized signatory
of the Trustee manually signs the certificate of
authentication on the Note, which signature shall be
conclusive evidence that the Note has been authenticated under
the Indenture. Upon receipt of a written order of the
Company, the Trustee will authenticate and deliver the Notes
as specified in such order.
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(C) Release of Property Subject to the Lien of the
Indenture.
Provided that no Event of Default then exists, the
Company is entitled to obtain a release of any lien securing
the Indenture Obligations with respect to any property of the
Company sold or otherwise disposed of in the ordinary course
of business (including the sale of gaming and other equipment
as part of a program to replace or upgrade gaming or such
other equipment) so long as the Company receives consideration
for such property at least equal to the Fair Market Value
thereof and the aggregate amount of the Fair Market Value of
all such property sold or otherwise disposed of does not
exceed $1,500,000 in the aggregate in any 12-month period.
The Company is also entitled to obtain a release of any lien
securing the Indenture Obligations with respect to any
property sold or otherwise transferred in any other permitted
asset sale provided that the Company complies with certain
reinvestment or Note repurchase obligations.
(D) Satisfaction and Discharge; Defeasance.
Upon the request of the Company, the Indenture will
cease to be of further effect (except as to surviving rights
of registration of transfer or exchange of Notes) as to all
outstanding Notes when either: (a) all such Notes theretofore
authenticated and delivered (except lost, stolen or destroyed
Notes which have been replaced or paid and Notes for whose
payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust) have been
delivered to the Trustee for cancellation; or (b)(i) all such
Notes not theretofore delivered to the Trustee for
cancellation have become due and payable or will become due
and payable at their Stated Maturity within one year or are to
be called for redemption within one year, and the Company has
irrevocably deposited or caused to be deposited, prior to the
date of such discharge, with the Trustee funds sufficient to
pay and discharge the entire indebtedness on the Notes not
theretofore delivered to the Trustee for cancellation, for
principal, premium, if any, and accrued interest to the date
of such deposit; (ii) the Company has paid all sums payable by
it under the Indenture, and (iii) the Company has delivered to
the Trustee an Officer's Certificate and an opinion of counsel
stating that all conditions precedent to satisfaction and
discharge have been complied with.
The Company may at any time terminate all of its
obligations with respect to the Notes and the Indenture
("Legal Defeasance"), except for certain obligations,
including those regarding any trust established for a
defeasance and obligations to register the transfer or
exchange of the Notes, to replace mutilated, destroyed, lost
or stolen Notes and to maintain agencies in respect to the
Notes. The Company may also at any time terminate its
obligations under certain covenants set forth in the Indenture
that constitute a Default or an Event of Default with respect
to the Notes issued under the Indenture ("Covenant
Defeasance"). In order to exercise either Legal Defeasance or
Covenant Defeasance, the Company must irrevocably deposit with
the Trustee in trust, for the benefit of the Holders, money or
United States Government Obligations (or a combination
thereof) in such amounts as will be sufficient to pay the
principal of, premium, if any, and interest on the Notes to
redemption or maturity, together with all other sums payable
by it under the Indenture, and
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comply with certain other conditions, including the delivery of
an opinion as to certain tax matters.
(E) Evidence as to compliance.
An officer of the Company will be required to
deliver to the Trustee a certificate, on or before a date no
more than 45 days after the end of the first, second and third
fiscal quarters of each fiscal year of the Company and not
more than 90 days after the end of each fiscal year of the
Company, stating whether or not, after a review under each
signer's supervision of the activities of the Company and the
Company Subsidiaries during such fiscal quarter or fiscal
year, as the case may be, and of the performance of the
Company and each Company Subsidiary under this Indenture and
the other Security Documents, to the best knowledge, based on
such review, of the signers thereof, a Default or Event of
Default has occurred during such fiscal quarter or fiscal
year, as the case may be, and, if there has been a Default or
Event of Default that is continuing, specifying each Default
or Event of Default and the nature and status thereof.
The Company must file with the Trustee and provide
to each Holder of the Notes of reports or other documents
filed with the Securities Exchange Commission (the
"Commission") pursuant to Sections 13, 14 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"). If the Company is not then subject to the reporting
requirements of the Exchange Act, the Company shall file with
the Trustee all such reports or documents that the Company
would have been required to file with the Commission if it
were subject to the requirements of Sections 13, 14 or 15(d)
of the Exchange Act. The Company will provide to the Trustee
and the Commission, in accordance with the rules and
regulations prescribed from time to time by the Commission,
such of the supplementary and periodic information, documents
and reports that may be required pursuant to Sections 13, 14
and 15 of the Exchange Act in respect of a security listed and
registered on a national securities exchange.
Item 9. Other Obligors.
The following entities are guarantors of the Notes:
BWBH, Inc.
1700 Lincoln Avenue, 49th Floor
Denver, CO 80203
BWCC, Inc.
1700 Lincoln Avenue, 49th Floor
Denver, CO 80203
Millsite 27, Inc.
1700 Lincoln Avenue, 49th Floor
Denver, CO 80203
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Silver Hawk Casino, Inc.
1700 Lincoln Avenue, 49th Floor
Denver, CO 80203
Contents of application for qualification. This
application for qualification comprises:
(a) Pages numbered 1 to 14, consecutively.
(b) The statement of eligibility and qualification
of the trustee under the indenture to be
qualified.
(c) The following exhibits in addition to those
filed as part of the statement of eligibility
and qualification of the trustee:
Exhibit T3A: Amended Restated Articles
of Incorporation, of the
Company to be in effect on
the effective date of the
Plan (filed as Exhibit 3.2
to the Company's Form 10,
File No. 0-28068).
Exhibit T3B: Amended and Restated Bylaws
of the Company to be in
effect on the effective
date of the Plan (filed as
Exhibit 3.2 to the
Company's Form 10, File No.
0-28068).
Exhibit T3C: Form of Indenture with
respect to the Notes
between the Company and
Fleet National Bank, as
Trustee.
Exhibit T3D: Not applicable.
Exhibit T3E-1: Disclosure Statement Relating to
Amended Joint Plan of
Reorganization of the Company
and the Colorado Subsidiaries
(filed as Exhibit 2.1 to the
Company's Form 10; File No.
0-28068).
Exhibit T3E-2: Amended Joint Plan of
Reorganization of the Company
and the Colorado subsidiaries
(filed as Exhibit 2.1 to the
Company's Form 10; File No.
0-28068).
Exhibit T3F: See Exhibit T3C for cross
reference sheet showing the
location in the Indenture
of the provisions inserted
therein pursuant to
Section 310 through 318(a),
inclusive, of the Act.
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Pursuant to the requirements of the Trust Indenture
Act of 1939, the applicant, Hemmeter Enterprises, Inc., a
corporation organized and existing under the laws of Delaware,
has duly caused this application to be signed on its behalf by
the undersigned, thereunto duly authorized, and its seal to be
hereunto affixed and attested, all in the City of Denver and
State of Colorado, on the 3rd day of June, 1996.
HEMMETER ENTERPRISES, INC.
By: /s/ Stephen J. Szapor ,Jr.
Name: Stephen J. Szapor, Jr.
Title: President and Chief
Executive Officer
Attest: /s/ /s/ Alan L. Mayer
Name: Alan L. Mayer
COLORADO GAMING & ENTERTAINMENT CO., as Issuer,
and
BWBH, INC.,
BWCC, INC.,
MILLSITE 27, INC. and
SILVER HAWK CASINO, INC.,
as Guarantors,
and
FLEET NATIONAL BANK,
as Trustee
___________
Indenture
Dated as of June 4, 1996
___________
up to $56,000,000
12% Senior Secured Pay-In-Kind Notes
Due 2003
Colorado Gaming & Entertainment Co.
Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture, dated as of June 4, 1996
Trust Indenture Indenture
Act Section Section
Section 310 (a) . . . . . . . . . . . . . 508
(1)
(a) (5) . . . . . . . . . . . . . 508
(b) . . . . . . . . . . . . . 505, 508,
509(d)
(b)(1) . . . . . . . . . . . . . 508
Section 311 . . . . . . . . . . . . . 505
(a) . . . . . . . . . . . . . 512
Section 312 (b) . . . . . . . . . . . . . 601
Section 313 . . . . . . . . . . . . . 101
(definition of
"Outstanding")
(a), (b) . . . . . . . . . . . . . 604
(c) . . . . . . . . . . . . . 604, 605(c)
Section 314 . . . . . . . . . . . . . 1109(a)
(a) . . . . . . . . . . . . . 605(c), 909(a)
(a) (4) . . . . . . . . . . . . . 908(a)
(c) . . . . . . . . . . . . . 301(d)
(d) . . . . . . . . . . . . . 1105(b)
Section 315 (b) . . . . . . . . . . . . . 501
(d) . . . . . . . . . . . . . 101
(definition of
"Outstanding")
(e) . . . . . . . . . . . . . 509(d)
Section 316 (a) . . . . . . . . . . . . . 101
(definition of
"Outstanding")
__________________
Note: This reconciliation and tie shall not, for any purpose,
be deemed to be a part of the Indenture.
RECITALS OF THE COMPANY . . . . . . . . . . . . . . . . . . . . 1
RECITALS OF THE GUARANTORS . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE 2
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION 2
Section 101. Definitions. 2
Section 102. Rules of Construction. 26
Section 103. Compliance Certificates and Opinions. 27
Section 104. Form of Documents Delivered to Trustee. 28
Section 105. Acts of Holders. 28
Section 106. Notices, Etc., to Trustee, the Company and
the Guarantors. 29
Section 107. Notice to Holders; Waiver. 30
ARTICLE TWO 30
THE NOTES 30
Section 201. Forms Generally. 30
Section 202. Title and Terms. 31
Section 203. Denominations. 32
Section 204. Execution, Authentication, Delivery and
Dating. 32
Section 205. Registration, Transfer and Exchange. 33
Section 206. Mutilated, Destroyed, Lost and Stolen Notes. 35
Section 207. Temporary Notes. 35
Section 208. Payment of Interest; Interest Rights
Preserved. 36
Section 209. Persons Deemed Owners. 37
Section 210. Cancellation. 38
Section 211. Computation of Interest. 38
ARTICLE THREE 38
SATISFACTION AND DISCHARGE 38
Section 301. Satisfaction and Discharge of Indenture. 38
Section 302. Survival of Certain Obligations. 40
Section 303. Application of Trust Money. 40
ARTICLE FOUR 40
DEFAULTS AND REMEDIES 40
Section 401. Events of Default. 40
Section 402. Acceleration of Maturity; Rescission and
Annulment. 43
Section 403. Collection of Indebtedness and Suits for
Enforcement by Trustee. 45
Section 404. Trustee May File Proofs of Claim. 46
Section 405. Trustee May Enforce Claims Without Possession
of Notes. 47
Section 406. Application of Money Collected. 47
Section 407. Limitation on Suits. 47
Section 408. Unconditional Right of Holders to Receive
Principal, Premium and Interest. 48
Section 409. Restoration of Rights and Remedies. 48
Section 410. Rights and Remedies Cumulative. 49
Section 411. Delay or Omission Not Waiver. 49
Section 412. Control by Holders. 49
Section 413. Waiver of Past Defaults. 50
Section 414. Environmental Laws and the Trustee. 50
ARTICLE FIVE 50
THE TRUSTEE 50
Section 501. Notice of Defaults. 51
Section 502. Duties of Trustee. 51
Section 503. Certain Rights of Trustee. 52
Section 504. Trustee Not Responsible for Recitals or
Issuance of Notes. 53
Section 505. May Hold Notes. 54
Section 506. Money Held in Trust. 54
Section 507. Compensation, Reimbursement and Indemnity. 54
Section 508. Corporate Trustee Required; Eligibility. 55
Section 509. Resignation and Removal; Appointment of
Successor. 56
Section 510. Acceptance of Appointment by Successor. 57
Section 511. Merger, Conversion, Consolidation or
Succession to Business. 58
Section 512. Preferential Collection of Claims Against
Company. 58
Section 513. Paying Agent; Note Registrar. 58
ARTICLE SIX 59
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY 59
Section 601. Disclosure of Names and Addresses of
Holders. 59
Section 602. Company to Furnish Trustee Names and
Addresses of Holders. 59
Section 603. Preservation of Information; Communications
to Holders. 60
Section 604. Reports by Trustee. 61
Section 605. Reports by Company. 61
ARTICLE SEVEN 62
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE 62
Section 701. Company May Consolidate, Etc., Only on
Certain Terms. 62
Section 702. Successor Substituted. 64
Section 703. Redemption. 64
ARTICLE EIGHT 64
SUPPLEMENTAL INDENTURES, AMENDMENTS AND WAIVERS 64
Section 801. Supplemental Indentures and Amendments
Without Consent of Holders. 64
Section 802. Supplemental Indentures and Amendments with
Consent of Holders. 66
Section 803. Execution or Acceptance of Supplemental
Indentures, Amendments and Waivers. 67
Section 804. Effect of Supplemental Indentures. 67
Section 805. Conformity with Trust Indenture Act. 68
Section 806. Reference in Notes to Supplemental
Indentures, Amendments or Waivers. 68
ARTICLE NINE 68
COVENANTS 68
Section 901. Payment of Principal, Premium, If Any, and
Interest. 68
Section 902. Maintenance of Note Register, Note Registrar
and Paying Agent. 68
Section 903. Money for Note Payments to Be Held in Trust. 69
Section 904. Corporate Existence and Keeping of Books. 70
Section 905. Payment of Taxes and Other Claims. 70
Section 906. Maintenance of Properties. 71
Section 907. Insurance. 71
Section 908. Statement by Officers as to Default. 72
Section 909. Provision of Financial Statements. 73
Section 910. Compliance with Laws, Etc. 74
Section 911. Limitation on Company Indebtedness. 74
Section 912. Limitation on Company Subsidiary Stock. 75
Section 913. Limitation on Restricted Payments. 75
Section 914. Limitation of Liens. 76
Section 915. Limitation on Dividends and Other Payment
Restrictions Affecting Company Subsidiaries. 76
Section 916. Limitation on Sale-Leaseback Transactions. 77
Section 917. Limitation on Restricted Asset Sales. 78
Section 918. Application of Net Cash Proceeds in Event of
Loss. 79
Section 919. Ownership of Stock of Company Subsidiaries. 80
Section 920. Limitation on Transactions with Affiliates. 80
Section 921. Change in Nature of Business. 81
Section 922. Additional Collateral. 81
Section 923. Non-Operating Subsidiaries. 83
Section 924. Maintenance of Fixed Charge Coverage. 83
Section 925. Noteholder Documents. 83
Section 926. Validity of Noteholder Security Interest. 84
Section 927. Investment Company Act. 84
Section 928. Payment for Consent. 84
Section 929. Hemmeter Consulting Agreements. 84
Section 930. Stay, Extension and Usury Laws. 85
ARTICLE TEN 85
REDEMPTIONS AND REPURCHASES OF NOTES 85
Section 1001. Right of Redemption. 85
Section 1002. Applicability of Article. 85
Section 1003. Election to Redeem; Notice to Trustee. 85
Section 1004. Selection by Trustee of Notes to Be Redeemed
or Repurchased. 86
Section 1005. Notice of Redemption. 86
Section 1006. Deposit of Redemption Price. 87
Section 1007. Notes Payable on Redemption Date. 87
Section 1008. Notes Redeemed in Part. 88
Section 1009. Redemption Pursuant to Gaming Laws. 88
Section 1010. Effect of Notice of Redemption. 88
Section 1011. Offer to Purchase Notes upon Change of
Control. 89
Section 1012. Procedure for Offers to Purchase Notes. 90
Section 1013. Effect of Purchase Notice. 92
Section 1014. Deposit of Purchase Price. 93
Section 1015. Notes Purchased in Part. 93
Section 1016. Covenant to Comply With Securities Laws Upon
Purchase of Notes. 93
Section 1017. Repayment to the Company. 93
ARTICLE ELEVEN 94
NOTEHOLDER SECURITY INTEREST 94
Section 1101. Noteholder Security Interest Generally. 94
Section 1102. Evidence of Perfection of Liens. 94
Section 1103. Suits to Protect the Collateral. 95
Section 1104. Further Assurances and Security. 95
Section 1105. Release of Collateral. 96
Section 1106. Reliance on Opinion of Counsel. 100
Section 1107. Purchaser May Rely. 100
Section 1108. Payment of Expenses. 100
Section 1109. Release and Substitution of Collateral-Trust
Indenture Act Compliance. 101
Section 1110. Release Upon Termination of the Company's
Obligations. 101
Section 1111. Trustee Duties with Respect to Collateral. 102
Section 1112. Priority of Liens. 102
ARTICLE TWELVE 106
LEGAL DEFEASANCE AND COVENANT DEFEASANCE 106
Section 1201. Option to Effect Legal Defeasance or Covenant
Defeasance. 106
Section 1202. Legal Defeasance and Discharge. 107
Section 1203. Covenant Defeasance. 107
Section 1204. Conditions to Legal Defeasance or Covenant
Defeasance. 108
Section 1205. Deposited U.S. Dollars and U.S. Government
Obligations to Be Held in Trust; Other
Miscellaneous Provisions. 110
Section 1206. Repayment to the Company. 110
Section 1207. Reinstatement. 111
ARTICLE THIRTEEN 111
GUARANTEE OF NOTES 111
Section 1301. Guarantee. 111
Section 1302. Nature of Guarantee. 112
Section 1303. Authorization. 112
Section 1304. Right to Demand Full Performance. 113
Section 1305. Certain Waivers. 114
Section 1306. The Guarantors Remain Obligated in Event the
Company Is No Longer Obligated to Discharge
Indenture Obligations. 115
Section 1307. Severability of Void Obligations under
Company Subsidiary Guarantee. 115
Section 1308. Guarantee Is in Addition to Other Security. 115
Section 1309. Release of Noteholder Security Interest. 115
Section 1310. No Bar to Further Actions. 116
Section 1311. Failure to Exercise Rights Shall Not Operate
as a Waiver; No Suspension of Remedies. 116
Section 1312. Trustee's Duties; Notice to Trustee. 116
Section 1313. Successors and Assigns. 117
Section 1314. Release of Guarantee. 117
Section 1315. Execution of Guarantee. 117
Section 1316. No Subrogation; Certain Agreements. 118
Section 1317. Bankruptcy; No Discharge. 118
Section 1318. Additional Guarantors. 119
ARTICLE FOURTEEN 119
MEETING OF NOTE HOLDERS 119
Section 1401. Purpose for Which Meeting May Be Called. 119
Section 1402. Manner of Calling Meeting. 120
Section 1403. Call of Meeting by Company or Holders. 120
Section 1404. Who May Attend and Vote at Meetings. 121
Section 1405. Regulations May Be Made by Trustee; Conduct
of the Meeting; Voting Rights; Adjournment. 121
Section 1406. Voting at the Meeting and Record to Be Kept. 122
Section 1407. Exercise of Rights of Trustee or Noteholders
May Not Be Hindered or Delayed by Call of
Meeting. 122
ARTICLE FIFTEEN 123
MISCELLANEOUS 123
Section 1501. Trust Indenture Act Controls. 123
Section 1502. Notices. 123
Section 1503. Successors and Assigns. 124
Section 1504. Benefits of Noteholder Documents. 124
Section 1505. Legal Holidays. 124
Section 1506. Exhibits and Schedules. 124
Section 1507. Governing Law. 125
Section 1508. No Adverse Interpretation of Other
Agreements. 126
Section 1509. No Recourse Against Others. 126
Section 1510. Severability Clause. 127
Section 1511. Duplicate Originals. 127
Section 1512. Table of Contents, Headings, Etc. 127
INDENTURE, dated as of June 4, 1996, among Colorado
Gaming & Entertainment Co., formerly known as Hemmeter
Enterprises, Inc., a corporation duly organized and existing
under the laws of the State of Delaware (herein called the
"Company"), as Issuer, having its principal office at One Norwest
Center, 1700 Lincoln, Denver, Colorado 80203, BWBH, Inc., a
corporation duly organized and existing under the laws of the
State of Delaware, BWCC, Inc., a corporation duly organized and
existing under the laws of the State of Delaware, Millsite 27,
Inc., a corporation duly organized and existing under the laws of
the State of Delaware, and Silver Hawk Casino, Inc., a
corporation duly organized and existing under the laws of the
State of Delaware, as Guarantors (each, a "Guarantor" and
collectively, together with any additional guarantor pursuant to
Sections 806 or 1318, the "Guarantors"), and Fleet National Bank,
a national banking association, as Trustee (herein called the
"Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an
issue of 12% Senior Secured Pay-In-Kind Notes Due 2003 (herein
called the "Notes"), of substantially the tenor and amount
hereinafter set forth, and to provide therefor the Company has
duly authorized the execution and delivery of this Indenture.
It is a condition precedent to the effectiveness of the
First Amended Joint Plan of Reorganization of Hemmeter
Enterprises, Inc., BWBH, Inc., BWCC, Inc. and Millsite 27, Inc.,
dated February 14, 1996, as the same may have been or may be
amended from time to time, in the Bankruptcy Cases that, among
other things, the Company and the Guarantors shall have executed
this Indenture, the Company shall have issued the Notes and each
of the Company and the Guarantors shall have granted and conveyed
the Noteholder Security Interest in and to the Collateral
pursuant to the Noteholder Documents.
All things necessary have been done to make the Notes,
when executed by the Company and authenticated and delivered
hereunder and duly issued by the Company, the valid obligations
of the Company and to make this Indenture a valid and binding
agreement of the Company, in accordance with their and its terms.
RECITALS OF THE GUARANTORS
Each of the Guarantors has duly authorized its
guarantee of the Notes and certain other obligations of the
Company as set forth in Article Thirteen hereof and endorsed on
the Notes (together with any amendment to the Guarantee of the
Notes to be executed by any Guarantor, the "Guarantee"), and to
provide therefor, each Guarantor has duly authorized the
execution and delivery of this Indenture.
All things necessary have been done to make the
Guarantee, when executed by the Guarantors and endorsed on the
Notes that will be authenticated and delivered hereunder and duly
issued by the Company, the valid and binding obligations of the
Guarantors and to make this Indenture a valid and binding
agreement of the Guarantors in accordance with their and its
terms.
NOW, THEREFORE, each party hereto agrees as follows for
the benefit of the other parties hereto and for the ratable
benefit of the Holders of the Notes:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
Section 101. Definitions.
"Act", when used with respect to any Holder, has the
meaning specified in Section 105.
"Additional Deed of Trust" has the meaning specified in
Section 922.
"Affiliate" of any specified Person means any other
Person that, directly or indirectly, controls, is controlled by
or is under direct or indirect common control with, such
specified Person and with respect to any natural Person, any
other Person having a relationship by blood, marriage or
adoption, not more remote than first cousins with such natural
Person. For the purposes of this definition, "control" when used
with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly,
whether through the ownership of Voting Stock or other equity
interests, by contract or otherwise, and the terms "controlling"
and "controlled" have meanings correlative to the foregoing;
provided that, in any event, any Person that owns directly or
indirectly 15% or more of the securities having ordinary voting
power for the election of directors or other governing body of
corporation or 15% or more of the partnership or other ownership
interests of any other Person (other than as a limited partner of
such other Person) will be deemed to control such corporation,
partnership or other Person.
"Affiliate Transaction" has the meaning specified in
Section 920.
"Agent" means any Note Registrar, Paying Agent, co-note
registrar, co-paying agent or other agent appointed pursuant to
Section 902.
"Amortization Expense" means, for any period, the
amount of the amortization expense, including bond discount or
premium, that is reflected on the financial statements of the
Company and any Company Subsidiaries consolidated in such
financial statements for such period in accordance with GAAP and
which was determined in accordance with GAAP.
"Asset Acquisition" means (a) any capital contribution
(including, without limitation, transfers of cash or other
property to others or payments for property or services for the
account or use of others, or otherwise), or purchase or
acquisition of Capital Stock or other similar ownership or profit
interest, by the Company or any of the Company Subsidiaries in
any other Person, in either case, pursuant to which such other
Person shall become a Company Subsidiary or any of the Company
Subsidiaries or shall be merged with or into the Company or any
of the Company Subsidiaries or (b) any acquisition by the Company
or any of the Company Subsidiaries of the assets of any Person
which constitute substantially all of an operating unit, division
or business of such Person.
"Average Life" means, as of the date of determination,
with respect to any debt security, the quotient obtained by
dividing (i) the sum of the product of the numbers of years from
the date of determination to the dates of each successive
scheduled principal (or redemption) payment of such debt security
multiplied by the amount of such principal (or redemption)
payment by (ii) the sum of all such principal (or redemption)
payments.
"Bank Documents" means each loan agreement, note,
security agreement, guaranty, mortgage, deed of trust and each
other agreement, instrument or document relating to the Bank
Indebtedness, as amended, modified or replaced from time to time.
"Bank Facility" means any revolving credit or term loan
facility, any facility providing purchase money financing for the
acquisition of equipment and any facility providing for the
creation of Capitalized Lease Obligations entered into between
the Company and/or any Company Subsidiary and one or more
financial institutions, institutional lenders, finance companies,
equipment lessors or equipment manufacturers or vendors, that, in
each case, are not Affiliates of the Company or any Company
Subsidiary, providing financing for working capital or other
corporate purposes on a secured or unsecured basis, whether now
existing or hereafter created and whether replacing or
refinancing any Bank Facility.
"Bank Indebtedness" means, at any date, all
Indebtedness of the Company and the Company Subsidiaries under
any Bank Facility and under any guarantee of such Indebtedness
executed by the Company and/or any Company Subsidiary (including,
without limitation, all principal, premium, interest, fees,
expenses, indemnities, other amounts payable in connection with
such Indebtedness and all rights, claims, demands, action or
causes of action of any nature whatsoever that the holders of
Bank Indebtedness may now hold or hereafter may acquire against
the Company and/or any Company Subsidiary, including, without
limitation, all interest accruing after commencement of any case,
proceeding, or other action relating to the bankruptcy,
insolvency, or reorganization of the Company and/or any Company
Subsidiary) that includes a provision regarding the purchase of
Bank Indebtedness by the Holders of the Notes that has
substantially the same terms and conditions as set forth in
Section __ of the Amended and Restated Loan and Security
Agreement, dated as of June 4, 1996, between Foothill Capital
Corporation, BWBH, BWCC, Inc., Millsite 27, Inc. and Silver Hawk
Casino, Inc.; provided, however, that, at any date, Bank
Indebtedness shall not include any Indebtedness of the Company or
any Company Subsidiary under any Bank Facility to the extent that
the aggregate amount of such Indebtedness under any Bank Facility
exceeds the Bank Indebtedness Amount on such date.
"Bank Indebtedness Amount" means $17,500,000, less the
aggregate payments of principal made on account of, and required
pursuant to the terms of, any Bank Indebtedness by reason of any
transaction or event (other than an Unrestricted Asset Sale)
involving all or any portion of the Collateral (including,
without limitation, a Restricted Asset Sale, an Event of Loss or
another transaction or event relating to the release of all or a
portion of the Collateral); provided, however, that if the Bank
Indebtedness Amount is reduced pursuant to the foregoing sentence
and, thereafter, the Company or any Company Subsidiary (i) makes
a Permitted Related Investment, and (ii) the Trustee receives a
valid and perfected first Lien (subject to Permitted Liens) in
and upon the assets comprising such Permitted Related Investment,
the Bank Indebtedness Amount shall be increased, but not above
$17,500,000, by the lesser of (i) the Fair Market Value of the
Collateral acquired as part of such Permitted Related Investment
(as of the date such Lien is perfected) and (ii) the amount of
such Permitted Related Investment (but only to the extent that
such Permitted Related Investment was not made with funds
withdrawn for such purpose from the Collateral Account) (it being
agreed that, notwithstanding anything herein to the contrary, any
voluntary prepayment of principal made on account of any Bank
Indebtedness or any payment of principal made on account of Bank
Indebtedness that was payable solely by reason of the occurrence
of a particular date set forth in the applicable Bank Document
and not by reason of any event or transaction involving all or a
portion of the Collateral (such as a sale or casualty) shall not
reduce the Bank Indebtedness Amount hereunder).
"Bankruptcy Cases" means Bankruptcy Case Nos. 96-
10001A, 96-10018A, 96-10019A and 96-10020A pending in the United
States Bankruptcy Court for the Eastern District of Louisiana.
"Bankruptcy Law" means any existing or future law of
any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, including,
without limitation, the Federal Bankruptcy Code or any similar
federal or state law for the relief of debtors.
"Bank Security Interest" means any Lien on the
Collateral and other assets and property of the Company and the
Company Subsidiaries securing the Bank Indebtedness.
"Black Hawk Casino" means the casino located in Black
Hawk, Colorado owned by BWBH on the date of this Indenture.
"Black Hawk Casino Event" means (i) a sale, assignment,
lease, transfer, conveyance or other disposition, directly or
indirectly, of the Black Hawk Casino or all or a significant
portion of BWBH's assets or properties, whether in a single
transaction or a series of related transactions, to any Person,
(ii) BWBH consolidates or merges with or into or winds up into
any other Person, (iii) the failure of the Company to own,
directly or indirectly, 100% of all classes of issued and
outstanding Capital Stock of BWBH, (iv) the occurrence of a
Restricted Asset Sale involving any assets or properties owned or
leased by BWBH or used by BWBH in the operation of the Black Hawk
Casino, or (v) the occurrence of an Event of Loss with respect to
BWBH or the Black Hawk Casino ; provided, however, that, with
respect to an Event of Loss involving any property or asset that
has a Fair Market Value of less than $3 million, a Black Hawk
Casino Event shall be deemed to have occurred under clause (v)
above only if the efficient operation of BWBH and the Black Hawk
Casino has not resumed within a period of twenty (20) Business
Days after the occurrence of the loss, destruction or material
damage to the property or asset giving rise to such Event of
Loss.
"Board of Directors" means either the board of
directors of the Company or any duly authorized committee of that
board.
"Board Resolution" means, with respect to any Person, a
duly adopted resolution of the board of directors of such Person.
"Business Day" means any day other than a Saturday, a
Sunday or any other day on which banking institutions or trust
companies in the State of New York, City of New York, or the city
in which the principal Corporate Trust Office of the Trustee is
located, are not required to be open.
"BWBH" means BWBH, Inc., a Delaware corporation.
"Capital Expenditure" means for any period, the sum of
the aggregate of all expenditures (whether paid in cash or
accrued as a liability) by the Company and the Company
Subsidiaries during that period which, in accordance with GAAP,
are or should be included in "additions to property, plant or
equipment" or similar items reflected in the consolidated
statement of cash flows of the Company. For purposes of this
definition, the purchase price of equipment which is purchased
simultaneously with the trade-in of existing equipment owned by
the Company or any Company Subsidiary or with insurance proceeds
(as permitted hereunder) shall be included in Capital
Expenditures only to the extent of the gross amount of such
purchase price less any credit granted by the seller of such
equipment for the equipment being traded in at such time or the
amount of such proceeds, as the case may be. For purposes of
determining the Consolidated Fixed Charges Coverage Ratio,
"Capital Expenditures" shall exclude all expenditures in respect
of the construction of Phase II of the 600-space parking garage
that the Company currently intends to construct adjacent to the
Black Hawk Casino and which is described in Appendix C to the
Disclosure Statement, dated February 14, 1996, for the Plan of
Reorganization.
"Capital Stock" means, with respect to any Person, any
and all shares, interests, participations, or other equivalents
or similar ownership or profit interest (however designated) of
such Person, including, without limitation, each class of common
stock and preferred stock of such Person or each class of
partnership interests of such Person.
"Capitalized Lease Obligation" means, with respect to
any Person, any obligation of a Person to pay rent or other
amounts under a lease of (or other agreement conveying the right
to use) any property (whether real, personal or mixed) that is
required to be classified and accounted for as a capital lease on
the face of a balance sheet of such Person prepared in accordance
with GAAP, and, for the purpose of this Indenture, the amount of
such obligation at any date of determination shall be the
capitalized amount thereof at such date, 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
(or other agreement) prior to the first date upon which such
lease (or other agreement) may be terminated by the lessee
without payment of a penalty.
"Cash Equivalents" means (a) readily marketable U.S.
Government Obligations maturing one year or less from the date of
purchase, (b) commercial paper having the highest rating
obtainable from either Moody's Investor Service, Inc. or Standard
& Poor's Corporation, Inc., (c) any certificate of deposit
maturing one year or less from the date of purchase issued by,
bankers' acceptances and deposit accounts of, and time deposits
with, a commercial bank chartered in the United States of America
or Canada with capital, surplus and undivided profits aggregating
in excess of $100,000,000, (d) any demand or fully insured time
deposit used in the ordinary course of the Company's business
with a commercial bank insured by the Federal Deposit Insurance
Corporation, and (e) any share of any money market fund that
invests solely in Cash Equivalents of the kind described in
clauses (a) through (d), above.
"Central City Casino" means the casino located in
Central City, Colorado owned by BWCC, Inc. on the date of this
Indenture.
"Change of Control" has the meaning specified in
Section 1011.
"Change of Control Purchase Offer" has the meaning
specified in Section 1011.
"Change of Control Purchase Price" has the meaning
specified in Section 1011.
"Collateral" means all "Collateral" referred to in any
of the Noteholder Documents and all other property or assets (or
interests in property or assets) that become subject to a Lien in
favor of the Trustee or the Holders under any of the Noteholder
Documents or applicable law, or by any other means.
"Collateral Account" means a deposit account in the
name of the Company, but under the sole dominion and control of
the Trustee, in which the Company and the Guarantors shall
deposit or shall cause to be deposited all Collateral Proceeds on
the Business Day on which such Collateral Proceeds are received
in accordance with Section 1105(c).
"Collateral Control Period" means the longer of:
(i) the earlier of (x) the period of one hundred eighty (180)
days after a Senior Event of Default and (y) the date on which
such Senior Event of Default shall have been cured or waived or
shall cease to exist or on which the Bank Indebtedness shall have
been discharged or paid in full in cash or in any other form
acceptable to the holders of Bank Indebtedness, and (ii) the
period during which the holders of Bank Indebtedness are
proceeding to enforce their rights and remedies with respect to
the Collateral under the Bank Documents; provided, however, that
during any 360-day period there shall be no more than one (1)
Collateral Control Period.
"Collateral Proceeds" means (a) any Net Cash Proceeds
received or receivable by the Company or any Company Subsidiary
as a result of an Event of Loss or a Restricted Asset Sale that
involves all or any portion of the Collateral and (b) all
interest or other earnings on amounts on deposit in the
Collateral Account.
"Collateral Proceeds Release Date" has the meaning
specified in Section 1105.
"Collateral Release Date" has the meaning specified in
Section 1105.
"Commission" means the Securities and Exchange
Commission, as from time to time constituted, created under the
Securities Exchange Act of 1934, or, if at any time after the
execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Common Stock" means, with respect to any Person, any
and all shares, interests, participation and other equivalents
(however designated, whether voting or non-voting) of such
Person's common stock, whether now outstanding or issued after
the date of this Indenture, and includes, without limitation, all
series and classes of such common stock.
"Company" means the Person named as the "Company" in
the first paragraph of this Indenture, until a successor Person
shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "Company" shall mean such
successor Person.
"Company Request" or "Company Order" means a written
request or order signed in the name of the Company by its
Chairman, its President, any Vice President, its Treasurer or an
Assistant Treasurer, and delivered to the Trustee.
"Company Subsidiary" means any corporation,
partnership, limited liability company, joint venture, trust,
estate or other entity of which (or in which) 50% or more of
(a) any class of the issued and outstanding Capital Stock or
other equity or ownership interest, (b) the interest in the
capital or profits of such partnership or joint venture or (c)
the beneficial interest in such trust or estate, is at the time
directly or indirectly owned or controlled by the Company, by the
Company and one or more of the Company Subsidiaries or by one or
more of the Company Subsidiaries.
"Consolidated" refers to the consolidation of accounts
in accordance with GAAP.
"Consolidated Cash Flow" means, for any fiscal quarter
in 1995, $___________, and, for any period thereafter, the sum
of:
(a) the Consolidated Net Income of the Company and the
Company Subsidiaries for such period, plus;
(b) the sum of the following items (but only to the
extent deducted in determining Consolidated Net Income and
without duplication): (i) all Consolidated Fixed Charges;
(ii) all Amortization Expense; (iii) all Depreciation
Expense; (iv) all Consolidated Income Tax Expense; (v) all
professional fees and other extraordinary expenses incurred
in connection with the Bankruptcy Cases or the restructuring
contemplated by the Plan of Reorganization; (vi) all
reductions or charges to Consolidated Net Income resulting
from the consummation of the Plan of Reorganization
(including, without limitation, as a result of the use by
the Company and the Company Subsidiaries of "fresh start"
accounting); and (vii) all charges to Consolidated Net
Income resulting from the write down or the sale or other
disposition of the investment of the Company or BWCC, Inc.
in the Central City Casino.
"Consolidated Coverage Ratio" means the ratio of (a)
Consolidated Cash Flow of the Company and the Company
Subsidiaries for the four full fiscal quarters for which
financial statements are available that immediately precede the
date of the transaction or other circumstances giving rise to the
need to calculate the Consolidated Coverage Ratio (the
"Transaction Date") to (b) the Consolidated Fixed Charges for the
fiscal quarter in which the Transaction Date occurs and to be
accrued during the three fiscal quarters immediately following
such fiscal quarter (based upon the pro forma amount of
Indebtedness of the Company and the Company Subsidiaries
outstanding on the Transaction Date and after giving effect to
the transaction in question). For purposes of this definition,
Consolidated Cash Flow and the items referred to in the preceding
clause (b) shall be calculated after giving effect on a pro forma
basis for the period of such calculation to (i) the incurrence or
retirement of any Indebtedness of the Company and the Company
Subsidiaries (including the Notes) at any time during the
Reference Period but on or after the Issue Date or subsequent to
the Reference Period and on or prior to the Transaction Date,
including, without limitation, the incurrence of the Indebtedness
giving rise to the need to make such calculation, as if such
Indebtedness were incurred on the first day of the Reference
Period; provided that if the Company or any of the Company
Subsidiaries directly or indirectly guarantees Indebtedness of a
third person, the above clause shall give effect to the
incurrence of such guaranteed Indebtedness as if the Company or
such Company Subsidiary had directly incurred such guaranteed
Indebtedness and (ii) any Restricted Asset Sale, Event of Loss or
Asset Acquisition (including, without limitation, any Asset
Acquisition giving rise to the need to make such calculation as a
result of the Company or any of the Company Subsidiaries
(including any Person who becomes a Company Subsidiary as result
of the Asset Acquisition) incurring Acquired Indebtedness)
occurring during the Reference Period and any retirement of
Indebtedness in connection with such Asset Acquisition, as if
such Restricted Asset Sale, Event of Loss or Asset Acquisition
and/or retirement occurred on the first day of the Reference
Period. Furthermore, in calculating the denominator (but not the
numerator) of "Consolidated Coverage Ratio," interest on
Indebtedness determined on a fluctuating basis that cannot be
determined in advance shall be deemed to accrue at the rate in
effect on the Transaction Date for such entire period.
"Consolidated EBITDA" means, for any period, the sum
of:
(a) the Consolidated Net Income of the Company and the
Company Subsidiaries for such period, plus;
(b) the sum of the following items (but only to the
extent deducted in determining Consolidated Net Income and
without duplication): (i) all Consolidated Fixed Charges;
(ii) all Amortization Expense; (iii) all Depreciation
Expense; and (iv) all Consolidated Income Tax Expense.
"Consolidated Fixed Charges" means as applied for any
period (a) the sum of the following items (without duplication):
(i) the aggregate amount of interest recognized by the Company
and the Company Subsidiaries in respect of their Consolidated
Indebtedness (including, without limitation, all interest
capitalized by the Company and the Company Subsidiaries during
such period, any amortization of deferred finance cost and debt
discount or premium and all commissions, discounts and other
similar fees and charges owed by the Company or any of the
Company Subsidiaries for letters of credit and bankers'
acceptance financing and the net costs associated with interest
rate protection agreements of the Company and the Company
Subsidiaries); (ii) the aggregate amount of the interest
component of rentals in respect of Capitalized Lease Obligations
recognized by the Company and the Company Subsidiaries; (iii) to
the extent any Indebtedness of any other Person is guaranteed by
the Company or any of the Company Subsidiaries, the aggregate
amount of interest paid or accrued by such other Person during
such period attributable to any such guaranteed Indebtedness;
(iv) dividends on Preferred Stock of any Company Subsidiary that
is held by a Person other than the Company or a Company
Subsidiary; (v) the interest portion of any deferred payment
obligation; and (vi) one-third of the rental expense attributable
to operating leases; and less (b) to the extent included in
clause (a) above, Amortization Expense or write-off of deferred
financing costs of the Company and the Company Subsidiaries and
any charge related to any premium or penalty paid in connection
with redeeming or retiring any Indebtedness before its stated
maturity, with the foregoing amounts in the case of both clauses
(a) and (b) above, as determined in accordance with GAAP.
"Consolidated Fixed Charges Coverage Ratio" means, with
respect to any four fiscal quarter period, the ratio of
(a) Consolidated EBITDA for such four fiscal quarter period less
Capital Expenditures for such four fiscal quarter period to
(b) Consolidated Fixed Charges for such four fiscal quarter
period.
"Consolidated Income Tax Expense" means, for any
period, federal, state, local and foreign income taxes of the
Company and the Company Subsidiaries for such period, determined
in accordance with GAAP; provided that, for purposes hereof,
"income taxes" shall specifically exclude any taxes paid to or
imposed by a Gaming Authority or a Liquor Authority.
"Consolidated Net Income" means, for any period, the
aggregate of the consolidated Net Income (or net loss) of the
Company and the Company Subsidiaries (determined in accordance
with GAAP); adjusted to exclude (to the extent included in such
consolidated Net Income) (a) the Net Income, if positive, of any
Person, other than a Company Subsidiary or any other Person whose
financial statements are (or should have been) consolidated for
financial statement reporting purposes with the financial
statements of the Company in accordance with GAAP, in which the
Company, any Company Subsidiary or such other Person has an
interest, except to the extent the amount of cash dividends or
other cash distributions in respect of Capital Stock or other
interest owned is actually paid (out of funds legally available
therefrom) to and received by the Company, any Company Subsidiary
or such other Person, but not in excess of such Person's pro rata
share of such Person's Net Income for such period; (b) all items
classified as gains (but not losses) that are either
extraordinary (as determined in accordance with GAAP) or are
nonrecurring (only to the extent included in computing such Net
Income (or net loss) and without duplication); (c) the Net
Income, if positive, of any other Person (except to the extent
includible in clause (a) above) accrued or attributable to any
period before the date on which it becomes a Company Subsidiary
or is merged into or consolidated with the Company or any of the
Company Subsidiaries or such other Person's property or Capital
Stock (or a portion thereof) is acquired by the Company or any of
the Company Subsidiaries; and (d) the Net Income, if positive, of
any Company Subsidiary to the extent that the declaration or
payment of dividends or similar distributions by such Company
Subsidiary of that income is not at the time permitted, directly
or indirectly, by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, law,
rule or governmental regulations applicable to that Company
Subsidiary or its stockholders (other than as a result of
restrictions on distribution permitted pursuant to Section 915).
"Consolidated Net Worth" means, of any Person at any
date of determination, the aggregate of capital, surplus and
retained earnings of such Person (plus amounts of equity
attributable to Preferred Stock) and its Subsidiaries and any
other Person ("Consolidated Subsidiary") whose financial
statements are (or should have been) consolidated for financial
statement reporting purposes, with the financial statements of
such Person in accordance with GAAP, as would be shown on the
consolidated balance sheet of such Person prepared in accordance
with GAAP, adjusted to exclude (to the extent included in
calculating such equity), (a) the amount of capital, surplus and
accrued but unpaid dividends attributable to any Disqualified
Stock or treasury shares, (b) all upward recalculations or other
write-ups subsequent to the date of this Indenture in the book
value of any asset owned by such Person or a Consolidated
Subsidiary of such Person, (c) goodwill and other intangible
assets and (d) Investments in Persons that are not Consolidated
Subsidiaries.
"Contingent Obligation" means, as to any Person, any
obligation of such Person guaranteeing or in effect guaranteeing
any Indebtedness, leases, dividends or other obligations
("primary obligations") of any other Person (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 or (d) otherwise to assure or
hold harmless the owner of any such primary obligation against
loss in respect thereof; provided, however, that the term
Contingent Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of
business. The amount of any Contingent Obligation shall be
deemed to be an amount equal to the stated or determinable amount
(based on the maximum reasonably anticipated net liability in
respect thereof as determined by the Company in good faith) of
the primary obligation or portion thereof in respect of which
such Contingent Obligation is made or, if not stated or
determinable, the maximum reasonably anticipated net liability in
respect thereof (assuming such Person is required to perform
thereunder) as determined by the Company in good faith.
"Corporate Trust Office" means the principal corporate
trust office of the Trustee, at which at any particular time its
corporate trust business shall be administered, which office at
the date of execution of this Indenture is located at 777 Main
Street, Hartford, Connecticut.
"Corporation" includes corporations, associations,
companies, limited liability companies and business trusts.
"Covenant Defeasance" has the meaning specified in
Section 1203.
"Custodian" means any receiver, trustee, assignee,
liquidator, or similar official under any Bankruptcy Law.
"Default" means any Event of Default, or an event that
would constitute an Event of Default but for the requirement that
notice be given or time elapse or both.
"Defaulted Interest" has the meaning specified in
Section 208.
"Default Premium Amount" means (i) for the period
following the Issue Date through June 1, 2001, an amount equal to
4% of the unpaid principal amount of all Outstanding Notes,
(ii) for the twelve-month period following June 1, 2001, an
amount equal to 3% of the unpaid principal amount of all
Outstanding Notes, and (iii) for the period subsequent to June 1,
2002, an amount equal to 2% of the unpaid principal amount of all
Outstanding Notes.
"Depreciation Expense" means, for any period, the
provision for depreciation that is reflected on the financial
statements of the Company and any Company Subsidiaries
consolidated in such financial statements for such period in
accordance with GAAP and which was determined in accordance with
GAAP.
"Disqualified Stock" means, with respect to any Person,
any Capital Stock that, 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, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or is exchangeable for Indebtedness, or is redeemable
at the option of the holder thereof, in whole or in part, on or
before the Maturity Date of the Notes.
"Environmental Law" means the common law and all
federal, state, local and foreign laws or regulations, codes,
orders, decrees, judgments or injunctions issued, promulgated,
approved or entered thereunder, now or hereafter in effect,
relating to pollution or protection of human health or the
environment, including, without limitation, laws relating to
(a) emissions, discharges, releases or threatened releases of
pollutants, contaminants, chemicals, or industrial, toxic or
hazardous constituents, substances or wastes, including, without
limitation, petroleum (including crude oil or any fraction
thereof) or any petroleum product or other wastes, chemicals or
substances regulated by any Environmental Law (collectively
referred to as "Hazardous Materials"), into the environment
(including, without limitation, ambient air, surface water,
ground water, land surface or subsurface strata), (b) the
manufacture, processing, distribution, use, generation,
treatment, storage, disposal, transport or handling of Hazardous
Materials, and (c) underground storage tanks, and related piping,
and emissions, discharges, releases or threatened release of
Hazardous Materials therefrom.
"Event of Default" has the meaning specified in Section
401.
"Event of Loss" means, with respect to any property or
asset (tangible or intangible, real or personal) that either is
(A) material to the efficient operation of any Gaming Facility of
the Company or any Company Subsidiary or (B) has a Fair Market
Value of $3 million or more, any of the following: (i) any loss,
destruction or material damage of such property or asset;
(ii) any institution of any proceedings for the condemnation or
seizure of such property or asset or for the exercise of any
right of eminent domain or navigational servitude; or (iii) any
actual condemnation, seizure or taking, by exercise of the power
of eminent domain or otherwise, of such property or asset, or
confiscation of such property or asset or the requisition of the
use of such property or asset.
"Event of Loss Offer", "Event of Loss Offer Notice" and
"Event of Loss Purchase Price" have the meanings specified in
Section 918.
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Fair Market Value" or "fair value" means, with respect
to any asset or property, the price which could be negotiated in
an arm's-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. Unless
otherwise specified by the Indenture, Fair Market Value of
property having a value in excess of $500,000 shall be determined
by the Board of Directors of the Company acting in good faith and
shall be evidenced by a Board Resolution delivered to the
Trustee.
"Federal Bankruptcy Code" means Title 11 of the United
States Code, as amended from time to time.
"GAAP" means generally accepted accounting principles
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 that are applicable as of the Issue
Date.
"Gaming Authority" means any agency, authority, board,
bureau, commission, department, office or instrumentality of any
nature whatsoever of the United States federal or foreign
government, any state, province or any city or other political
subdivision or otherwise and whether now or hereafter in
existence, or any officer or official thereof, with authority to
regulate any gaming operation (or proposed gaming operation)
owned, managed, or operated by the Company or any of the Company
Subsidiaries.
"Gaming Facilities" means any land-based, riverboat,
dockside or other casino gaming business of a Person or any
business that is related to, ancillary or supportive of,
connected with or arising out of the gaming business of such
Person (including, without limitation, developing and operating
lodging, dining, child care, amusement, sports or entertainment
facilities, transportation services or other related activities
or enterprises and any additions or improvements thereto).
"Gaming Laws" means each gaming law of any Gaming
Authority, including, without limitation, the State of Colorado,
and its political subdivisions, as amended from time to time, and
the regulations promulgated and rulings issued thereunder
applicable to the Company or any of the Company Subsidiaries or
shareholders.
"Governmental Authority" means any government (federal,
state or local), any governmental agency, bureau or board or any
governmental office, officer or official (including
environmental) having jurisdiction over the Company or any of the
Company Subsidiaries.
"Guarantee" has the meaning stated in the recital of
the Guarantors in this Indenture.
"guarantee" by any Person means any obligations,
contingent or otherwise, of such Person directly or indirectly
guaranteeing any Indebtedness of any other Person and, without
limiting the generality of the foregoing, any obligation, direct
or indirect, contingent or otherwise, of such Person: (i) to
purchase or pay (or advance or supply funds for the purchase of
payment of) such Indebtedness of such other Person (whether
arising by virtue of participation arrangements, by agreement to
keep well, to purchase assets, goods, securities or services, to
take-or-pay or to maintain a financial statement conditions or
otherwise); or (ii) entered into for the purpose of assuring the
obligee of such Indebtedness in any other manner of the payment
thereof, or to protect such obligee of such Indebtedness in any
other manner of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part), provided
that the term "guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business.
"Guarantor" and "Guarantors" means the Persons named as
Guarantors pursuant to the first paragraph of this instrument.
"Holder" means a Person in whose name a Note is
registered in the Note Register.
"Indebtedness" of any Person means (a) any liability,
contingent or otherwise, of such Person (i) for borrowed money
(whether or not the recourse of the lender is to the whole of the
assets of such Person or only to a portion thereof), (ii)
evidenced by a note, bond, debenture or similar instrument,
letters of credit, acceptances or other similar facilities (other
than accounts payable to trade creditors created or assumed by
such Person in the ordinary course of business), (iii) for any
Capitalized Lease Obligation or (iv) any obligation relating to
the balance deferred and unpaid of the purchase price of property
or services, including, without limitation, a purchase money
obligation (other than accounts payable to trade creditors
created or assumed by such Person in the ordinary course of
business); (b) any reimbursement obligations relating to letters
of credit issued for the account of such Person; (c) any
obligation secured by a Lien to which the property or assets
(including, without limitation, leasehold interests and any other
tangible or intangible property rights) of such Person are
subject, whether or not the obligations secured thereby shall
have been assumed by or shall otherwise be such Person's legal
liability; (d) all obligations of such Person to purchase,
redeem, retire, defease or otherwise make any payment in respect
of any Capital Stock of or other ownership or profit interest in
such Person or any of its Affiliates or any warrants, rights or
options to acquire such Capital Stock, valued, in the case of
Disqualified Stock, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid
dividends; (e) all indebtedness incurred by such Person in the
acquisition (whether by way of purchase, merger, consolidation or
otherwise) of any business, real property or other assets, except
assets, other than capital assets, acquired in the ordinary
course of the conduct of the acquiror's business ("Acquired
Indebtedness"); (f) all Interest Rate and Currency Protection
Obligations; (g) any guarantee by such Person of any
indebtedness, obligation or liability of any other Person of the
kind described in any of the preceding clauses; and (h) any and
all deferrals, renewals, extensions and refundings of, or
amendments, restructurings, modifications or supplements to, any
indebtedness, obligation, guarantee or liability of the kind
described in any of the preceding clauses.
"Indenture" means this instrument as originally
executed and as it may from time to time be supplemented or
amended in accordance with the terms hereof.
"Indenture Obligations" has the meaning specified in
Section 1301.
"Independent", when used with respect to any Person,
means such other Person who (a) is in fact independent, (b) does
not have any direct financial interest or any material indirect
financial interest in the Company or in any Affiliate of the
Company and (c) is not an officer, employee, promoter,
underwriter, trustee, partner or person performing similar
functions for the Company or a spouse, family member or other
relative of any such Person. Whenever it is provided in the
Indenture that any Independent Person's opinion or certificate
shall be furnished to the Trustee, such Person shall be appointed
by the Company and approved by the Trustee in the exercise of
reasonable care, and such opinion or certificate shall state that
the signer has read this definition and that the signer is
Independent within the meaning hereof.
"Interest and Currency Rate Protection Obligations"
means the obligations of any Person pursuant to any direct or
indirect interest rate swap, cap or collar agreement, interest
rate future or option contract, currency swap agreement, currency
future or option contract and other similar agreement or
arrangement designed to hedge against fluctuations in interest
rates or foreign exchange rates.
"Interest Payment Date" means December 1, 1996 and each
June 1 and December 1 thereafter.
"Investment", by any Person in any other Person, means
(without duplication) (i) any, direct or indirect, loan, advance,
deposit with, guarantee or other extension of credit or capital
contribution to (including, without limitation, transfers of cash
or other property to others or payments for property or services
for the account or use of others, or otherwise) by such Person to
such other Person, (ii) any purchase or acquisition (whether for
cash, property, services, securities or other property) by such
Person of Capital Stock, partnership or other ownership
interests, warrants, rights, options, bonds, notes, debentures or
other securities or evidences of Indebtedness issued by such
other Person or Indebtedness of such other Person secured by (or
for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on any assets
or properties (including, without limitation, accounts and
contract rights) owned by such Person, even though such Person
has not assumed or become liable for the payment of such
Indebtedness, (iii) the entering into by such Person of any
guarantee, or other Contingent Obligation, with respect to
Indebtedness or other liability of such other Person (except in
the case of the Company or a Company Subsidiary, the guarantee by
the Company of any of the obligations of any Company Subsidiary
or by any Company Subsidiary of any of the obligations of the
Company or any other Company Subsidiary) or (iv) any commitment
or agreement to do any of the foregoing. The amount of any
Investment shall be the original cost of such Investment, plus
the cost of all additions thereto, and minus the amount of any
portion of such Investment repaid to the Person making such
Investment in cash as a repayment of principal or a return of
capital, as the case may be, but without any other adjustments
for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment. In determining the
amount of any Investment involving a transfer of any property
other than cash, such property shall be valued at its fair value
at the time of such transfer, as determined in good faith by the
Board of Directors of the person making such transfer, whose
determination will be conclusive absent manifest error.
"Issue Date" means June 4, 1996.
"Legal Defeasance" has the meaning specified in Section
1202.
"Legal Requirements" means all applicable restrictive
covenants, applicable zoning and subdivision ordinances and
building codes, all applicable health and environmental
regulations, all applicable Gaming Laws, Liquor Laws and all
other applicable laws, ordinances, rules, regulations, judicial
decisions, administrative orders, and other requirements of any
Governmental Authority having jurisdiction over the Company or
any Company Subsidiary in effect either at the time of execution
of this Indenture or at any time during the term hereof.
"Lien" means any mortgage, pledge, lien (statutory or
other), encumbrance, assignment for security, deposit arrangement
or preference or other security agreement of any kind or nature
whatsoever, charge, hypothecation, interest or adverse claim
affecting title or resulting in an encumbrance upon or with
respect to any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired, or a security
interest of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell and any
filing of or agreement to give any financing statement under the
Uniform Commercial Code (or equivalent statutes) of any
jurisdiction, excluding operating leases).
"Liquor Authority" means any agency, authority, board,
bureau, commission, department, office or instrumentality of any
nature whatsoever of the United States federal or foreign
government, any state, province or any city or other political
subdivision or otherwise and whether now or hereafter in
existence, or any officer or official thereof, with authority to
regulate the service or distribution of liquor or alcoholic
beverages by the Company or any of the Company Subsidiaries.
"Liquor Laws" means each law of any Liquor Authority,
including, without limitation, the State of Colorado, and its
political subdivisions, as amended from time to time, and the
regulations promulgated and rulings issued thereunder applicable
to the sale or distribution of liquor or alcoholic beverages by
the Company or any of the Company Subsidiaries.
"Marketable Securities" means Cash Equivalents or any
fund investing exclusively in Cash Equivalents.
"Maturity", when used with respect to any Note, means
the date on which the principal of such Note or an installment of
principal becomes due and payable as therein or herein provided,
whether at the Stated Maturity or by declaration of acceleration,
notice of redemption, required purchase or otherwise.
"Maturity Date", when used with respect to any Note,
means the date specified in such Note as the fixed date on which
the principal of such Note is due and payable.
"Net Cash Proceeds" means, with respect to any
Restricted Asset Sale, Event of Loss, issuance or sale by the
Company or any Company Subsidiary of its Capital Stock or similar
equity interest or incurrence of Indebtedness, as the case may
be, the proceeds thereof in the form of cash or Cash Equivalents
received by the Company or any of the Company Subsidiaries
(whether as initial consideration, through the payment or
disposition of deferred compensation, the payment of insurance
proceeds or the release of reserves), after deducting therefrom
(without duplication): (a) reasonable and customary brokerage
commissions, underwriting fees and discounts, legal fees,
finder's fees and other similar fees and expenses incurred in
connection with such Restricted Asset Sale or Event of Loss;
(b) provisions for all taxes (other than income taxes) payable as
a result of such Restricted Asset Sale or Event of Loss; and
(c) payments made to retire Indebtedness (other than payments on
the Notes), including, but not limited to, Bank Indebtedness,
secured by the assets subject to such Restricted Asset Sale or
Event of Loss to the extent required pursuant to the terms of
such Indebtedness.
"Net Income" means, with respect to any Person for any
period, the net income (or loss) of such Person determined in
accordance with GAAP.
"Non-Operating Subsidiaries" means (i) Michigan City
Casino and Lodge, Inc., an Indiana corporation; (ii) HEI-Mexico,
Inc., a Delaware corporation; and (iii) HEDC, Inc., a Delaware
corporation.
"Noteholder Documents" means this Indenture, the Notes,
the Security Agreement, the Pledge Agreement and any other pledge
agreement, mortgage, deed of trust, security agreement or similar
instrument or document securing the Noteholder Indebtedness and
each other agreement, instrument or document relating to the
Noteholder Indebtedness, each as amended, modified or replaced
from time to time.
"Noteholder Indebtedness" means, at any date, all
Indebtedness of the Company and the Company Subsidiaries under
the Indenture, the Notes, the Noteholder Documents and the
Guarantee and under any other guarantee of such Indebtedness
executed by the Company and any Company Subsidiary (including,
without limitation, all Indenture Obligations, all obligations of
the Guarantors under the Guarantee, and all principal, premium,
interest, fees, expenses, indemnities, other amounts payable in
connection with such Indebtedness and all rights, claims,
demands, action or causes of action of any nature whatsoever that
the Holders of Notes (or the Trustee on their behalf) may now
hold or hereafter may acquire against the Company and/or any
Company Subsidiary, including, without limitation, all interest
accruing after commencement of any case, proceeding, or other
action relating to the bankruptcy, insolvency, or reorganization
of the Company and/or any Company Subsidiary, and any
Indebtedness owing to the Trustee under the Noteholder
Documents).
"Noteholder Security Interest" means any Lien on such
Collateral and other assets and property of the Company and the
Company Subsidiaries securing the Noteholder Indebtedness.
"Note Register" and "Note Registrar" have the
respective meanings specified in Section 205.
"Notes" has the meaning stated in the first recital of
this Indenture and more particularly means any securities
authenticated and delivered under this Indenture.
"Notice of Offer" means a Restricted Asset Sale Offer
Notice or an Event of Loss Offer Notice, as the case may be.
"Officers' Certificate" means a certificate signed by
the Chairman, the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion from legal
counsel, who is reasonably acceptable to the Trustee, which
counsel may be an employee of, or counsel to, the Company or the
Trustee.
"Outstanding", when used with respect to Notes, means,
as of the date of determination, all Notes (including all
Secondary Notes) theretofore authenticated and delivered under
this Indenture, except:
(i) Notes theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Notes, or portions thereof, for whose payment or
redemption money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act
as its own Paying Agent) for the Holders of such Notes;
provided that, if such Notes are to be redeemed, notice of
such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee
has been made;
(iii) Notes, except to the extent provided in
Sections 1202 and 1203, with respect to which the Company
has effected defeasance and/or covenant defeasance as
provided in Article Twelve; and
(iv) Notes which have been paid pursuant to Section 206
or in exchange for or in lieu of which other Notes have been
authenticated and delivered pursuant to this Indenture,
other than any such Notes in respect of which there shall
have been presented to the Trustee proof satisfactory to it
that such Notes are held by a bona fide purchaser in whose
hands the Notes are valid obligations of the Company;
provided, however, that in determining whether the Holders of the
requisite principal amount of Outstanding Notes have given any
request, demand, authorization, direction, consent, notice or
waiver hereunder, and for the purpose of making the calculations
required by TIA Sections 313, 315(d)(3) or 316(a), Notes owned by
the Company or any other obligor upon the Notes (including any
Guarantor) or any Affiliate of the Company or any Company
Subsidiary or such other obligor shall be disregarded and deemed
not to be Outstanding, except that, in determining whether the
Trustee shall be protected in making such calculation or in
relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Notes which a Responsible Officer
of the Trustee knows to be so owned shall be so disregarded.
Notes so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the
reasonable satisfaction of the Trustee the pledgee's right so to
act with respect to such Notes and that the pledgee is not the
Company or any other obligor upon the Notes or any Affiliate of
the Company or such other obligor.
"Paying Agent" means any Person (including the Company
acting as Paying Agent) authorized by the Company to pay the
principal of (and premium, if any, on) or interest on any Notes
on behalf of the Company.
"Permitted Liens" means:
(i) Liens on property acquired by the Company or any
of the Company Subsidiaries (including an indirect
acquisition of property by way of a merger of a Person with
or into the Company or any of the Company Subsidiaries or
the acquisition of a Person), provided that such Liens were
in existence prior to the contemplation of such acquisition,
merger or consolidation, and were not created in connection
therewith or in anticipation thereof, and provided that such
Liens do not extend to any additional property or assets of
the Company or any of the Company Subsidiaries;
(ii) statutory Liens to secure the performance of
obligations, surety or appeal bonds, performance bonds or
other obligations of a like nature incurred in the ordinary
course of business (exclusive of obligations in respect of
the payment of borrowed money), or for taxes, assessments or
governmental charges or claims, provided that in each case
the obligations are not yet delinquent or are being
contested in good faith by appropriate proceedings promptly
instituted and diligently concluded and any reserve or other
adequate provision as shall be required in conformity with
GAAP shall have been made therefor;
(iii) leases or subleases granted to others not
interfering in any material respect with the business of the
Company or any of the Company Subsidiaries;
(iv) with respect to the property involved, easements,
rights-of-way, navigational servitudes, restrictions, minor
defects or irregularities in title and other similar charges
or encumbrances which do not interfere in any material
respect with the ordinary conduct of business of the Company
and the Company Subsidiaries as now conducted or as
contemplated herein;
(v) Liens in favor of the Company or any Guarantor
which are assigned to the Trustee as Collateral for the
Notes and the Guarantee, as applicable;
(vi) Liens in favor of the Trustee under the Indenture
and the Noteholder Documents;
(vii) Liens securing any Bank Indebtedness;
(viii) The replacement, extension or renewal of any
Lien permitted by clauses (i) through (vii) upon or in the
same property theretofore subject thereto or the
replacement, extension or renewal (except for clause (vii),
without increase in the principal amount or change in any
direct or contingent obligor) of the Indebtedness secured
thereby.
"Permitted Line of Business" means, with respect to any
Person, any land-based, riverboat, dockside or other casino
gaming business of such Person or any business that is related
to, ancillary or supportive of, connected with or arising out of
the gaming business of such Person (including, without
limitation, developing and operating lodging, dining, child care,
amusement, sports or entertainment facilities, service of
alcoholic beverages, transportation services or other related
activities or enterprises and any additions or improvements
thereto).
"Permitted Related Investment" means the acquisition of
property or assets by a Person to be used in connection with a
Permitted Line of Business of such Person, including, without
limitation, any physical improvements of existing property or
assets of such Person.
"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, limited
liability company, trust, unincorporated association, joint
venture or other entity, or a government or any political
subdivision or agency thereof.
"Plan of Reorganization" means the First Amended Joint
Plan of Reorganization of Hemmeter Enterprises, Inc., BWBH, BWCC,
Inc. and Millsite 27, Inc. which was confirmed in the Bankruptcy
Cases, as the same may have been or may be amended from time to
time.
"Pledge Agreement" means the Pledge Agreement of even
date herewith duly executed by the Company in favor of the
Trustee for its benefit and the benefit of the Holders.
"Predecessor Note" of any particular Note means every
previous Note evidencing all or a portion of the same debt as
that evidenced by such particular Note; and, for the purposes of
this definition, any Note authenticated and delivered under
Section 206 in exchange for a mutilated Note or in lieu of a
lost, destroyed or stolen Note shall be deemed to evidence the
same debt as the mutilated, lost, destroyed or stolen Note.
"Preferred Stock", as applied to the Capital Stock of
any Person, means Capital Stock of such Person of any class or
classes (however designated) that ranks prior, as to the payment
of dividends on or to the distribution of assets upon any
voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of
such Person.
"Process Agent" has the meaning specified in Section
1507.
"Purchase Date" has the meaning specified in Section
1012.
"Purchase Notice" has the meaning specified in Section
1012.
"Purchase Offer" means the Change of Control Purchase
Offer, the Restricted Asset Sale Offer or the Event of Loss
Offer, as applicable.
"Purchase Price" means the Change of Control Purchase
Price, Restricted Asset Sale Purchase Price or Event of Loss
Purchase Price, as applicable.
"Redemption Date", when used with respect to any Note
to be redeemed, in whole or in part, means the date fixed for
such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Note
to be redeemed, means the price at which it is to be redeemed
pursuant to this Indenture and such Notes.
"Reference Period" means, as of any date and with
regard to any person, the four full fiscal quarters ended
immediately preceding such date.
"Regular Record Date" for the interest payable on any
Interest Payment Date means the May 15 or November 15 (whether or
not a Business Day), as the case may be, next preceding such
Interest Payment Date.
"Responsible Officer", when used with respect to the
Trustee, means any officer in the Trustee's Corporate Trust
Office or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above-
designated officers, and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the
particular subject.
"Restricted Asset Sale" means any direct or indirect
(a) issuance by any Company Subsidiary to any Person (other than
the Company or a wholly-owned Company Subsidiary) of any Capital
Stock of any Company Subsidiary or other similar equity interest
or (b) sale, conveyance, assignment, transfer, lease or other
disposition (including, without limitation, by means of a Sale-
Leaseback Transaction) by the Company or any Company Subsidiary
to any Person (other than the Company or a wholly-owned Company
Subsidiary), in one transaction or a series of related
transactions, of any property or asset of the Company or any
Company Subsidiary, whether now owned or hereafter acquired
(excluding any Unrestricted Asset Sale).
"Restricted Asset Sale Offer", "Restricted Asset Sale
Offer Notice" and "Restricted Asset Sale Purchase Price" have the
meanings specified in Section 917.
"Restricted Payment" means any of the following:
(a) the declaration or payment of any dividend or any other
distribution (whether made in cash, property or securities) on
Capital Stock of the Company or any Company Subsidiary or any
payment made to the direct or indirect holders (in their
capacities as such) of Capital Stock of the Company or any
Company Subsidiary (other than (i) dividends or distributions
payable solely in Capital Stock (other than Disqualified Stock)
otherwise permitted by the Indenture and (ii) in the case of a
Company Subsidiary, dividends or distributions payable to the
Company or to a wholly-owned Company Subsidiary), (b) the
purchase, defeasance, redemption or other acquisition or
retirement for value of any Capital Stock, or any warrants,
rights or options to purchase such Capital Stock of the Company
or any Company Subsidiary (other than Capital Stock of such
Company Subsidiary held by the Company or any of the Company
Subsidiaries), (c) the making of any principal payment on, or the
purchase, defeasance, repurchase, redemption or other acquisition
or retirement for value, before any scheduled maturity, scheduled
repayment or scheduled sinking fund payment, of any instrument
evidencing Indebtedness which is subordinated in any manner in
right of payment to the Notes and (d) the making of any
Investment in any Person (which shall, solely for purposes of
this clause (d), exclude the payment of Capital Stock of the
Company or any other consideration to the direct holders of
Capital Stock of such Person in connection with a transaction
pursuant to which such Person shall become a wholly-owned Company
Subsidiary) or guarantee of any Investment in any Person
(including, without limitation, any Affiliate of the Company)
other than a Person that would be a wholly-owned Company
Subsidiary immediately after giving effect to such Investment;
provided, however, that any Investments made in a Company
Subsidiary which ceases to be a Company Subsidiary shall
thereafter be considered as having been Restricted Payments when
made in determining the aggregate amount of all Restricted
Payments made to a particular date.
"Sale-Leaseback Transaction" means any arrangement with
any Person providing for the leasing by the Company or any
Company Subsidiary of any real or tangible personal property,
which property has been or is to be sold or transferred by the
Company or any such Company Subsidiary to such Person in
contemplation of such leasing.
"Secondary Notes" has the meaning specified in Section
208.
"Securities Act" means the Securities Act of 1933, as
amended.
"Security Agreement" means the Security Agreement of
even date herewith, duly executed by the Company and each
Guarantor in favor of the Trustee for its benefit and the benefit
of the Holders.
"Senior Event of Default" means the occurrence of an
event of default under any of the Bank Documents.
"Silver Hawk Property" means the real property located
at 100 Chase Street, Black Hawk, Colorado 80422.
"Special Record Date" has the meaning specified in
Section 208.
"Stated Maturity" means, with respect to any
Indebtedness, the date specified in such Indebtedness as the
fixed date on which the principal of such Indebtedness or such
installment of interest is due and payable. Unless otherwise
stated, "Stated Maturity" when used with respect to any Note
refers to the Stated Maturity of the principal of (and not
interest on) the Notes.
"Subject Subsidiaries" means, collectively, the Company
Subsidiaries, other than BWBH.
"Subsidiary" means, with respect to any Person, (i) a
corporation a majority of whose Capital Stock with voting power,
under ordinary circumstances, to elect directors is at the time,
directly or indirectly, owned by such Person, by such Person and
one or more Subsidiaries of such Person or by one or more
Subsidiaries of such Person or (ii) any other Person (other than
a corporation) in which such Person, one or more Subsidiaries of
such Person, or such Person and one or more Subsidiaries of such
Person, directly or indirectly, at the date of determination
thereof has at least a majority ownership interest.
"Trust Indenture Act" or "TIA" means the Trust
Indenture Act of 1939, as amended.
"Trustee" means the Person named as the "Trustee" in
the first paragraph of this Indenture until a successor Trustee
shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "Trustee" shall mean such
successor Trustee.
"Unrestricted Asset Sale" means any sale, conveyance,
assignment, transfer, lease or other disposition by the Company
or any Company Subsidiary to any Person (other than the Company
or a Company Subsidiary) in one transaction or a series of
related transactions, of any property or asset of the Company or
the Company Subsidiaries, whether now owned or hereafter
acquired, to the extent that (a) such sale, conveyance,
assignment, transfer, lease or other disposition is in the
ordinary course of business, (b) the Company or a Company
Subsidiary, as the case may be, receives consideration at the
time of such Unrestricted Asset Sale at least equal to the Fair
Market Value (as determined in good faith by the Company taking
into account the aggregate benefits to the Company and the
Company Subsidiaries after giving effect to the proposed
Unrestricted Asset Sale) of the assets or property sold,
conveyed, assigned, transferred or otherwise disposed of and
(c) the aggregate amount of the Fair Market Value (as determined
in good faith by the Company) of the assets or property sold,
conveyed, assigned, transferred or otherwise disposed of does not
exceed $1,500,000 in any twelve-month period. For purposes of
the foregoing sentence, the sale or other disposition of any slot
machine or other equipment (i) which is obsolete or otherwise
unnecessary in the ongoing operations of the Company and the
Company Subsidiaries, or (ii) as part of a program to replace or
upgrade any part of the slot machines or other equipment of the
Company or any of the Company Subsidiaries, shall be deemed to be
a sale or other disposition in the ordinary course of business.
"U.S. Dollars" means lawful currency of the United
States.
"U.S. Government Obligations" has the meaning specified
in Section 1204.
"Vice President", when used with respect to the
Company, means any vice president, whether or not designated by a
number or a word or words added before or after the title "vice
president".
"Voting Stock" of any Person means Capital Stock of
such Person which ordinarily has voting power for the election of
directors (or persons performing similar functions) of such
Person, whether at all times or only as long as no senior class
of securities has such voting power by reason of any contingency.
Section 102. Rules of Construction.
Unless the context otherwise requires:
(1) a term defined in this Indenture has the meaning
assigned to it in the Indenture;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive and the word "including"
shall mean without limitation;
(4) words in the singular include the plural, and
words in the plural include the singular;
(5) 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; and
(6) any gender used in this Indenture shall be deemed
to include the neuter, masculine or feminine genders.
Section 103. Compliance Certificates and Opinions.
Upon any application or request by the Company to the
Trustee to take any action under any provision of this Indenture,
the Company shall furnish to the Trustee an Officers' Certificate
stating that all conditions precedent, if any, provided for in
this Indenture (including any covenant the compliance with which
constitutes a condition precedent) relating to the proposed
action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions
precedent, if any, have been complied with, except that in the
case of any such application or request as to which the
furnishing of such documents is specifically required by any
provision of this Indenture relating to such particular
application or request, no additional certificate or opinion need
be furnished.
Every certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture
(other than pursuant to Section 908(a)) shall include:
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition
and the definitions herein relating thereto;
(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 each such
individual, he has made such examination or investigation
as, is necessary to enable him to express an informed
opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been
complied with.
Section 104. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person,
it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be
so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such
Person may certify or give an opinion as to such matters in one
or several documents.
Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless
such officer knows that the certificate or opinion or
representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such
certificate or Opinion of Counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating
that the information with respect to such factual matters is in
the possession of the Company, unless such counsel knows, or in
the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates,
statements, opinions or other instruments under this Indenture,
they may, but need not, be consolidated and form one instrument.
Section 105. Acts of Holders.
(a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this
Indenture or any other Noteholder Document to be given or taken
by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders
in person or by agents duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to
the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are sometimes referred to herein
as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 502) conclusive
in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The record date for determining the Holders
entitled to give or take any request, demand, authorization,
direction, notice, consent, waiver or other Act provided by this
Indenture shall be the first date on which a signed instrument or
instruments embodying or evidencing any of the foregoing is
delivered to the Trustee, and, where it is hereby expressly
required, to the Company.
Notwithstanding the foregoing, 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 of any provision of this Indenture or to any
indenture supplemental hereto, provided that (i) the Company
gives at least 20 days' prior written notice of such record date
to the Trustee, the Note Registrar and the Holders and (ii) any
such Act of the Holders shall become effective within 30 days
after such record date.
(c) The fact and date of the execution by any Person
of any such instrument or writing may be established in any
reasonable manner that the Trustee deems sufficient, which shall
include, but not be limited to, notarization of such instrument.
(d) The ownership of Notes shall be proved by the Note
Register.
(e) Any request, demand, authorization, direction,
notice, consent, waiver or other Act by the Holder of any Note
shall bind every future Holder of the same Note or the Holder of
every Note issued upon the transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done,
suffered or omitted to be done by the Trustee, any Paying Agent
or the Company or any Guarantor in reliance thereon, whether or
not notation of such action is made upon such Note.
Section 106. Notices, Etc., to Trustee, the Company and
the Guarantors.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or
permitted by this Indenture or any other Noteholder Document to
be made upon, given or furnished to, or filed with,
(a) the Trustee by any Holder or by the Company or any
Guarantor shall be sufficient for every purpose hereunder if
made, given, furnished or filed in writing to or with the
Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administration, or at any other address previously
furnished in writing to such Person by the Trustee; or
(b) the Company or any Guarantor by the Trustee or by
any Holder shall be sufficient for every purpose hereunder
(unless otherwise herein expressly provided) if in writing
and sent via registered or certified mail, telefax, telex or
overnight delivery service to the Company or the Guarantor,
as the case may be, addressed to it at the address set forth
on Schedule 106, or at any other address previously
furnished in writing to the Trustee by the Company or such
Guarantor.
Section 107. Notice to Holders; Waiver.
Where this Indenture provides for notice of any event
to Holders by the Company or the Trustee, such notice shall be
sufficiently given (unless otherwise herein expressly provided)
if in writing and sent via certified mail, telefax or overnight
delivery service, to each Holder affected by such event, at its
address as it appears in the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice is so
provided to Holders, neither the failure to provide such notice,
nor any defect in any such notice, to any particular Holder shall
affect the sufficiency of such notice with respect to any other
Holders. Where this Indenture provides for notice in any manner,
such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice
by Holders shall be filed with the Trustee, but such filing shall
not be a condition precedent to the validity of any action taken
in reliance upon such waiver.
ARTICLE TWO
THE NOTES
Section 201. Forms Generally.
The Notes and the Trustee's certificate of
authentication and the notation with respect to the Guarantee
shall be substantially in the form of Exhibit A attached hereto,
with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture.
Exhibit A is hereby incorporated in and expressly made a part of
this Indenture. The Notes may have such letters, numbers or
other marks of identification and such legends or endorsements
placed thereon as may be required to comply with the rules of any
securities exchange or as may consistently herewith be determined
by the officers executing such Notes, as evidenced by their
execution of the Notes. Any portion of the text of any Note or
the notation with respect to the Guarantee may be set forth on
the reverse thereof, with an appropriate reference thereto on the
face of the Note.
The definitive Notes shall be printed, lithographed or
engraved on steel-engraved borders or may be produced in any
other manner, all as determined by the officers of the Company
executing such Notes, as evidenced by their execution of such
Notes.
Section 202. Title and Terms.
The aggregate principal amount of Notes which may be
authenticated and delivered under this Indenture is limited to
$50,000,000 (plus Secondary Notes, as defined in Section 208),
except for Notes authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Notes
pursuant to Sections 204, 205, 206, 207, 806, 1008 and 1015.
The Notes shall be known and designated as the 12%
Senior Secured Pay-In-Kind Notes Due 2003 of the Company. Their
Stated Maturity shall be June 1, 2003, and they shall bear
interest at the rate per annum equal to 12%, accruing from the
Issue Date (or in the case of Secondary Notes issued after the
Issue Date pursuant to Section 208, the respective dates of
issuance thereof), or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, payable on
December 1, 1996 and semiannually thereafter on June 1 and
December 1 in each year and at said Stated Maturity, until the
principal thereof is paid or duly provided for; provided,
however, that if any interest is not paid when due, such overdue
interest shall bear interest, payable in arrears on each Interest
Payment Date and on demand, at a rate per annum at all times
equal to 12%.
The principal of (and premium, if any, on) and interest
on the Notes shall be payable at the office or agency of the
Company maintained for such purpose in The City of New York, or
at such other office or agency of the Company as may be
maintained for such purpose. Notwithstanding any provisions of
this Indenture to the contrary, prior to the Stated Maturity of
the Notes, if the Company and a Holder shall so agree, payments
of interest on and principal of any Note shall be made by the
Paying Agent directly to the Holder of such Note (whether by
federal funds, wire transfer or otherwise), without any
requirement of surrender of such Note. In any such case, if the
Trustee shall then act as Paying Agent, the Company shall deliver
written instructions to the Trustee at least 15 days prior to the
relevant payment date requesting that such payment will be so
made and designating the bank account to which such payment shall
be made. Unless a new instruction is delivered to the Trustee at
least 15 days prior to any subsequent payment date, the Trustee
shall make any payment due on any such subsequent payment date in
accordance with the previous instructions. The Company will
indemnify and hold harmless the Trustee from and against any
loss, liability or expense (including attorneys' fees) resulting
from any act or omission to act on the part of the Company or any
such Holder in connection with any such agreement or which the
Trustee may incur as a result of making any payment in accordance
with any such agreement.
The payment of the Notes is guaranteed pursuant to the
Guarantee in favor of the Holders.
The Notes and the Guarantee are secured by and entitled
to the benefits of the Liens in the Collateral provided by the
Noteholder Documents.
The Notes shall be repurchased by the Company, at the
option of the Holders, pursuant to Sections 917, 918 and 1011.
The Notes shall be redeemable as provided in Article
Ten.
Section 203. Denominations.
The Notes shall be issuable only in registered form
without coupons and only in denominations of $1,000 and any
integral multiple thereof.
Section 204. Execution, Authentication, Delivery and
Dating.
The Notes shall be executed on behalf of the Company by
its Chairman, its President or a Vice President, under its
corporate seal reproduced thereon and attested by its Secretary
or an Assistant Secretary. The signature of any of these
officers on the Notes may be manual or facsimile.
The Guarantee shall be executed on behalf of each
Guarantor by an officer of the Guarantor or by an officer of the
Company authorized by power of attorney to act on behalf of such
Guarantor. Each Guarantor hereby irrevocably appoints each
officer of the Company who would be authorized to execute any of
the Notes on behalf of the Company its due and lawful attorney-
in-fact to execute the Notation of Guarantee on the face of each
Note on behalf of such Guarantor. The signature of any such
officer on the Guarantee may be manual or facsimile.
Notes and the Guarantee bearing the manual or facsimile
signatures of individuals who were at any time the proper
officers of the Company or such Guarantor shall bind the Company
and such Guarantors, notwithstanding that such individuals or any
of them have ceased to hold such offices prior to the
authentication and delivery of such Notes or Guarantee or did not
hold such offices at the date of such Notes or Guarantee.
At any time and from time to time after the execution
and delivery of this Indenture, the Company may deliver Notes
executed by the Company and the Guarantors to the Trustee for
authentication, together with a Company Order for the
authentication and delivery of such Notes, and the Trustee in
accordance with such Company Order shall authenticate and deliver
such Notes.
Each Note shall be dated the date of its
authentication.
The Company Order may also request the Trustee to
authenticate certificates representing Notes bearing any
notation, legend or endorsement permitted by Section 201 or to
remove any such notation, legend or endorsement.
The Trustee may appoint an authenticating agent to
authenticate Notes. 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 agent. An authenticating agent has the
same rights as an Agent to deal with the Company, the Guarantors
or their Affiliates.
No Note shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there
appears on such Note a certificate of authentication
substantially in the form provided for herein duly executed by
the Trustee by manual signature of an authorized officer, and
such certificate upon any Note shall be conclusive evidence, and
the only evidence, that such Note has been duly authenticated and
delivered hereunder and is entitled to the benefits of this
Indenture.
In case the Company, pursuant to Article Seven, shall
be consolidated or merged with or into any other Person or shall
convey transfer, lease or otherwise dispose of its properties and
assets substantially as an entirety to any Person, and the
successor Person resulting from such consolidation, or surviving
such merger or into which the Company shall have been merged or
the Person which shall have received a conveyance transfer, lease
or other disposition as aforesaid shall have executed an
indenture supplemental hereto with the Trustee pursuant to
Article Seven, any of the Notes authenticated or delivered prior
to such consolidation, merger, conveyance, transfer, lease or
other disposition may, from time to time, at the request of the
successor Person, be exchanged for other Notes executed in the
name of the successor Person with such changes in phraseology and
form as may be appropriate but otherwise in substance of like
tenor as the Notes surrendered for such exchange and of like
principal amount; and the Trustee, upon Company Request of the
successor Person, shall authenticate and deliver Notes as
specified in such request for the purpose of such exchange. If
Notes shall at any time be authenticated and delivered in any new
name of a successor Person pursuant to this Section in exchange
or substitution for or upon registration of transfer of any
Notes, such successor Person, at the option of the Holders but
without expense to them, shall provide for the exchange of all
Notes at the time Outstanding for Notes authenticated and
delivered in such new name.
Section 205. Registration, Transfer and Exchange.
(a) The Company shall cause to be kept at the
Corporate Trust Office of the Trustee a register (the register
maintained in such office and in any other office or agency
designated pursuant to Section 902 being herein sometimes
referred to as the "Note Register") in which the Company shall
provide for the registration of Notes and of transfers of Notes.
The Note Register shall be in written form or any other form
capable of being converted into written form within a reasonable
time. At all reasonable times, the Note Register shall be open
to inspection by the Trustee. The Trustee is hereby initially
appointed as security registrar (the "Note Registrar") for the
purpose of registering Notes and transfers of Notes as herein
provided.
Upon surrender for registration of transfer of any Note
at the office or agency of the Company designated pursuant to
Section 902, the Company and the Guarantors shall execute, and
the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Notes of
any authorized denomination or denominations of a like aggregate
principal amount.
At the option of a Holder, Notes may be exchanged for
other Notes of any authorized denomination and of a like
aggregate principal amount upon surrender of the Notes to be
exchanged at such office or agency. Whenever any Notes are so
surrendered for exchange, the Company and the Guarantors shall
execute, and the Trustee shall authenticate and deliver, the
Notes which the Holder making the exchange is entitled to
receive.
All Notes issued upon any registration of transfer or
exchange of Notes shall be the valid obligations of the Company
and the Guarantors, evidencing the same debt (including, without
limitation, the Guarantee), and entitled to the same benefits
under this Indenture, as the Notes surrendered upon such
registration of transfer or exchange.
Every Note presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or
the Note Registrar) be duly endorsed, or be accompanied by a
written instrument of transfer, in form satisfactory to the
Company and the Note Registrar duly executed by the Holder
thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange or redemption of Notes, but the Company may
require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any
registration of transfer or exchange of Notes, other than
exchanges pursuant to Section 207, 806, 1008 and 1015.
The Company shall not be required (i) to issue,
register the transfer of or exchange any Note during a period
beginning at the opening of business 15 days before mailing of a
notice of redemption of or of an offer to repurchase the Notes
selected for redemption or repurchase and ending at the close of
business on the day of such mailing, (ii) to register the
transfer of or exchange any Note so selected for redemption in
whole or in part, except in the case of any Note to be redeemed
in part, the portion thereof not to be redeemed, or (iii) to
register the transfer of or exchange any Note in respect of which
a Purchase Notice has been given to any Paying Agent until the
earlier of (A) such time as such notice has been withdrawn in
accordance with Section 1013 or (B) the Purchase Date.
Section 206. Mutilated, Destroyed, Lost and Stolen
Notes.
If (i) any mutilated Note is surrendered to the
Trustee, or (ii) the Company and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any Note,
and there is delivered to the Company and the Trustee such Note
or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Company or the
Trustee that such Note has been acquired by a bona fide
purchaser, the Company and the Guarantors shall execute, and upon
Company Order, the Trustee shall authenticate and deliver, in
exchange for any such mutilated Note or in lieu of any such
destroyed, lost or stolen Note, a new Note of like tenor and
principal amount, bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen
Note has become or is about to become due and payable, the
Company in its discretion may, instead of issuing a new Note, pay
such Note.
Upon the issuance of any new Note under this Section,
the Company may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section in lieu
of any destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Company and the
Guarantors, whether or not the destroyed, lost or stolen Note
shall be at any time enforceable by anyone, and shall be entitled
to all benefits of this Indenture equally and proportionately
with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies
with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Notes.
Section 207. Temporary Notes.
Pending the preparation of definitive Notes, the
Company and the Guarantors may execute, and upon Company Order,
the Trustee shall authenticate and deliver, temporary Notes which
are printed, lithographed, typewritten, mimeographed or otherwise
produced in any authorized denomination, substantially of the
tenor of the definitive Notes in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions
and other variations as the officers executing such Notes may
determine as conclusively evidenced by their execution of such
Notes.
If temporary Notes are issued, the Company and the
Guarantors will cause definitive Notes to be prepared without
unreasonable delay. After the preparation of definitive Notes,
the temporary Notes shall be exchangeable for definitive Notes
upon surrender of the temporary Notes at the office or agency of
the Company designated for such purpose pursuant to Section 902,
without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Notes, the Company and the Guarantors
shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like principal amount of definitive Notes of
authorized denominations. Until so exchanged, the temporary
Notes shall in all respects be entitled to the same benefits
under this Indenture as definitive Notes.
Section 208. Payment of Interest; Interest Rights
Preserved.
Interest on any Note which is payable, and is
punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name such Note (or one
or more Predecessor Notes) is registered at the close of business
on the Regular Record Date for such interest.
Through and including June 1, 1997, on each Interest
Payment Date, the Company may, at its option and in its sole
discretion, in lieu of the payment in whole or in part of
interest in cash on the Notes (other than any Notes that were
issued after the Issue Date as Secondary Notes pursuant to this
Section 208) pay interest on the Notes through the issuance of
additional Notes ("Secondary Notes") in an aggregate principal
amount equal to the amount of interest that would be payable with
respect to the Notes, if such interest were paid in cash;
provided, however, that the Company shall only be permitted to
issue Secondary Notes pursuant to this paragraph if there is, as
of the date of such issuance, an effective registration statement
under the Securities Act covering such issuance or such issuance
is exempt from registration under the Securities Act. On each
Interest Payment Date following June 1, 1997, the Company shall
pay interest on the Notes in cash. The Company shall notify the
Trustee in writing of such election not less than ten nor more
than 45 days prior to the Regular Record Date for an Interest
Payment Date on which Secondary Notes will be issued. On each
such Interest Payment Date, the Trustee shall authenticate
Secondary Notes for original issuance to each Holder on the
relevant Regular Record Date in the aggregate principal amount
required to pay the amount of interest on the Notes that the
Company has elected to pay through its issuance of Secondary
Notes in lieu of cash. Notwithstanding any other provision of
this paragraph to the contrary, the Company shall pay cash in
lieu of issuing Secondary Notes in any denomination of less than
$1,000 (which shall be determined with respect to the aggregate
amount of Notes held by each Holder as shown by the records of
the Trustee). Notwithstanding anything contained in this
Indenture to the contrary, interest on any Secondary Note shall
be payable only in cash.
Any interest on any Note that is payable, but is not so
paid or duly provided for, on or before any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be
payable to the Holder of record on the relevant Regular Record
Date by virtue of having been such Holder; and such Defaulted
Interest shall be paid by the Company to the Persons in whose
names the Notes (or their respective Predecessor Notes) are
registered at the close of business on the day fixed by the
Company to determine which Holders shall receive the payment of
Defaulted Interest (the "Special Record Date"). The Company
shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Note, and shall deposit with
the Trustee an amount of U.S. Dollars equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest
in immediately available funds by 10:00 a.m. (New York time) on
the Business Day immediately preceding the payment date, such
U.S. Dollars when deposited to be held in trust for the benefit
of the Persons entitled to such Defaulted Interest as in this
Section provided. In the name and at the expense of the Company,
the Trustee shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be
sent via registered or certified mail, telefax, telex or
overnight delivery service, to each Holder at its address as it
appears in the Note Register, provided that the Company shall
deliver notice to the Trustee at least 15 days' prior to the date
notice is to be given to the Holders. The Trustee shall pay such
Defaulted Interest forthwith to the Persons in whose names the
Notes (or their respective Predecessor Notes) are registered on
such Special Record Date.
Subject to the foregoing provisions of this Section,
each Note delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Note shall
carry the rights to interest accrued and unpaid, and to accrue,
which were carried by such other Note.
Section 209. Persons Deemed Owners.
Prior to and at the time of the due presentment of a
Note for registration of transfer, the Company, the Trustee and
any agent of the Company or the Trustee may treat the Person in
whose name such Note is registered as the owner of such Note for
the purpose of receiving payment of principal of (and premium, if
any, on) and (subject to Sections 205 and 208) interest on such
Note and for all other purposes whatsoever, whether or not such
Note be overdue, and neither the Company, the Trustee nor any
agent of the Company or the Trustee shall be affected by notice
to the contrary.
Section 210. Cancellation.
All Notes surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and
shall be promptly canceled by it. The Company may at any time
deliver to the Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and may deliver to the Trustee
(or to any other Person for delivery to the Trustee) for
cancellation any Notes previously authenticated hereunder which
the Company has not issued and sold, and all Notes so delivered
shall be promptly canceled by the Trustee. If the Company shall
so acquire any of the Notes, however, 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. No Notes shall be
authenticated in lieu of or in exchange for any Notes canceled as
provided in this Section, except as expressly permitted by this
Indenture. All canceled Notes held by the Trustee shall be
disposed of by the Trustee in accordance with its customary
procedures and certification of their disposal delivered to the
Company, unless by Company Order, the Company shall direct that
canceled Notes be returned to it. The Company may not issue new
Notes to replace Notes that it has paid or delivered to the
Trustee for cancellation.
Section 211. Computation of Interest.
Interest on the Notes shall be computed on the basis of
a 360-day year of twelve 30-day months.
ARTICLE THREE
SATISFACTION AND DISCHARGE
Section 301. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be
of further effect (except as to surviving rights of registration
of transfer or exchange of Notes herein expressly provided for)
and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of
this Indenture when
(a) either
(i) all Notes theretofore authenticated and
delivered (other than (A) Notes which have been
destroyed, lost or stolen and which have been
replaced or paid as provided in Section 206 and
(B) Notes for whose payment U.S. Dollars have
theretofore been deposited in trust with the
Trustee or any Paying Agent or segregated and held
in trust by the Company and thereafter repaid to
the Company or discharged from such trust, as
provided in Section 903) have been delivered to
the Trustee for cancellation; or
(ii) all such Notes not theretofore delivered to
the Trustee for cancellation
(A) have become due and payable, or
(B) will become due and payable at their
Stated Maturity within one year, or
(C) are to be called for redemption within
one year under arrangements satisfactory to
the Trustee for the giving of notice of
redemption by the Trustee in the name, and at
the expense, of the Company,
and the Company, in the case of subclause (A), (B) or
(C) of clause (ii) above, has irrevocably deposited or
caused to be deposited with the Trustee as trust funds,
in trust for such purpose an amount in U.S. Dollars
sufficient to pay and discharge the entire indebtedness
on such Notes not theretofore delivered to the Trustee
for cancellation, as certified to the Trustee by a
nationally recognized firm of independent public
accountants, for principal (and premium, if any) and
interest to the date of such deposit (in the case of
Notes which have become due and payable) or to the
Stated Maturity or Redemption Date, as the case may be;
(b) the Company, any Guarantor or any other obligor
under the Notes has paid or caused to be paid all other
sums payable hereunder by the Company, the Guarantors
and any other obligor under the Notes, including,
without limitation, all sums due to the Trustee;
(c) the Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this
Indenture have been complied with; and
(d) the Company and each Guarantor has complied with
Section 314(c) of the Trust Indenture Act in connection
with such satisfaction and discharge.
Section 302. Survival of Certain Obligations.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under
Section 507 and, if U.S. Dollars shall have been deposited with
the Trustee pursuant to subclause (ii) of clause (a) of
Section 301, the obligations of the Trustee under Section 303 and
the last paragraph of Section 903 shall survive.
Section 303. Application of Trust Money.
Subject to the provisions of the last paragraph of
Section 903, all U.S. Dollars deposited with the Trustee pursuant
to Section 301 shall be held in trust and applied by it, in
accordance with the provisions of the Notes and this Indenture,
to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the
principal (and premium, if any) and interest for whose payment
such U.S. Dollars has been deposited with the Trustee.
ARTICLE FOUR
DEFAULTS AND REMEDIES
Section 401. Events of Default.
"Event of Default", wherever used herein, means any one
of the following events (whatever the reason for such Event of
Default and whether it shall be occasioned by the provisions of
Article Thirteen or be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative
or governmental body):
(a) default in the payment of any interest on any Note
when the same becomes due and payable, and such default
continues for a period of 10 days; or
(b) default in the payment of the principal of (or
premium, if any, on) any Note when the same becomes due and
payable at Stated Maturity, upon redemption pursuant to
Sections 1001 and 1007, upon repurchase pursuant to
Sections 917, 918, 1011 and 1012, by acceleration or
otherwise, including failure to make payment of any Purchase
Price or Redemption Price, as and when due; or
(c) default in the due observance or performance of
any covenant, condition or agreement contained in Section
919, 924 or 929; or
(d) default in the performance, or breach, of any
covenant or warranty of the Company or any Company
Subsidiary in this Indenture, or by the Company or any
Guarantor under the Security Agreement, or any other
Noteholder Document, or by any Guarantor under the Guarantee
on its part to be performed (other than a default in the
performance, or breach, of a covenant or warranty which is
specifically dealt with elsewhere in this Section), and
continuance of such default or breach for a period of 30
days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and
the Trustee by the Holders of at least 25% in principal
amount of the Outstanding Notes a written notice specifying
such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder;
or
(e) default by the Company or any of the Company
Subsidiaries in (i) any payment of principal of or interest
on any Indebtedness (including, without limitation, any Bank
Indebtedness) or in the payment of any Contingent
Obligation, beyond the period of grace, if any, provided in
the instrument or agreement under which such Indebtedness or
Contingent Obligation was created; or (ii) the observance or
performance of any other agreement or condition relating to
any such Indebtedness or Contingent Obligation or contained
in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders
of such Indebtedness or beneficiary or beneficiaries of such
Contingent Obligation (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to
cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity, any
applicable grace period having expired, or such Contingent
Obligation to become payable, any applicable grace period
having expired, provided that the aggregate principal amount
of all such Indebtedness and Contingent Obligations which
would then become due or payable, together with the
principal amount of any other such Indebtedness under which
such a default then exists or with respect to which the
maturity thereof has been so accelerated or that has not
been paid at maturity, aggregates $1,000,000 or more; or
(f) any Person entitled to take the actions described
in this Section 401(f), after the occurrence of any event of
default under any agreement or instrument evidencing any
Indebtedness in excess of $1,000,000 in the aggregate of the
Company or any Company Subsidiary, shall notify the Trustee
of the intended sale or disposition of any assets of the
Company or any Company Subsidiary that have been pledged to
or for the benefit of such Person to secure such
Indebtedness or shall commence proceedings, or take any
action (including by way of set-off) to retain in
satisfaction of any Indebtedness, or to collect on, seize,
dispose of or apply, any such assets of the Company or any
Company Subsidiary (including funds on deposit or held
pursuant to lock-box and other similar arrangements),
pursuant to the terms of any agreement or instrument
evidencing, securing or relating to any such Indebtedness of
the Company or any Company Subsidiary or in accordance with
applicable law; or
(g) any warrant of attachment in an amount of
$1,000,000 or more is issued against any portion of the
property or assets of the Company or any Company Subsidiary
and is not quashed within 30 days after issuance, or final
judgments not covered by insurance for the payment of money
which in the aggregate at any one time exceeds $1,000,000
shall be rendered against the Company or any Company
Subsidiary by a court of competent jurisdiction and shall
remain undischarged for a period (during which execution
shall not be effectively stayed) of 30 days after such
judgment becomes final and nonappealable; or
(h) a court of competent jurisdiction enters a
judgment decree or order for relief under any Bankruptcy Law
which shall (i) approve as properly filed a petition seeking
reorganization, arrangement, adjustment or composition in
respect of the Company or any Company Subsidiary, (ii)
appoint a Custodian of the Company or any Company
Subsidiary, or for any part of their respective properties
or (iii) order the winding-up or liquidation of the
Company's or any Company Subsidiary's affairs; and such
judgment, decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or any
bankruptcy or insolvency petition or application is filed,
or any bankruptcy or insolvency proceeding is commenced,
against the Company or any Company Subsidiary and such
petition, application or proceeding is not dismissed within
60 days; or
(i) the Company or any Company Subsidiary, pursuant to
or within the meaning of any Bankruptcy Law, (i) becomes
insolvent, (ii) fails generally to pay its debts as they
become due, (iii) admits in writing its inability to pay its
debts generally as they become due, (iv) commences any case,
proceeding or other action seeking to have an order for
relief entered with respect to it, or seeking to adjudicate
it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it
or its debts, (v) consents to the entry of a judgment,
decree or order for relief against it in an involuntary case
or proceeding under any Bankruptcy Law, (vi) consents to the
appointment of a Custodian of it or for any part of its
property, (vii) consents to or acquiesces in the institution
of a bankruptcy or an insolvency proceeding against it,
(viii) applies for, consents to or acquiesces in the
appointment of or taking possession by a Custodian of the
Company or any Company Subsidiary, or for any part of its
property, (ix) makes a general assignment for the benefit of
its creditors, or (x) takes any corporate action in
furtherance of any of the foregoing; or
(j) any Noteholder Document ceases to be in full force
and effect or any Noteholder Document ceases to create in
favor of the Trustee, with respect to any amount of
Collateral, a valid and perfected first priority Lien
(subject only to Permitted Liens) on the Collateral
purported to be covered thereby; or
(k) the Guarantee is determined by a court of
competent jurisdiction to be null and void with respect to
any Guarantor or any Guarantor denies that it has any
further liability under the Guarantee or gives notice to
such effect (other than by reason of: (i) the indefeasible
payment in full of all principal of, premium, if any, and
interest on the Notes; (ii) the termination of this
Indenture; or (iii) a release pursuant to the provisions
described under Section 1204 or 1314); or
(l) the cessation of substantially all gaming
operations at any Gaming Facility which has commenced
operations, other than the Central City Casino, for more
than 45 consecutive days, except as a result of an Event of
Loss; provided, however, that the cessation of substantially
all gaming operations at any Gaming Facility as a result of
renovations of or construction at or adjacent to such Gaming
Facility for 90 consecutive days or less shall not
constitute an Event of Default under this Section 401(l); or
(m) the occurrence of a Black Hawk Casino Event; or
(n) the revocation, suspension or involuntary loss of
the legal right to own or operate any Gaming Facility and
such revocation, suspension or involuntary loss shall be
continuing for more than 45 consecutive days; or
(o) the Company or any Company Subsidiary shall fail
to comply with its obligations under Article Seven hereof.
Section 402. Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default (other than an Event of Default
specified in Section 401(h) or 401(i)) occurs and is continuing,
then and in every such case the Trustee or the Holders of not
less than 25% in principal amount of the Notes Outstanding may
declare the principal amounts of all the Notes to be due and
payable immediately, together with (A) unpaid interest thereon
and (B) in the case of an Event of Default under Section 401(a),
(b), (d), (e), (j), (k), (l), (m), (n) or (o), the Default
Premium Amount in effect at the time such Event of Default
occurs, by a notice in writing to the Company (and to the Trustee
if given by Holders), and upon any such declaration such amounts
shall become immediately due and payable. If an Event of Default
specified in Section 401(h) or 401 (i) occurs and is continuing,
then the principal amount of all the Notes, together with unpaid
interest thereon, shall ipso facto become and be immediately due
and payable without any declaration or other act on the part of
the Trustee or any Holder.
At any time after a declaration of acceleration has
been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount
of the Notes Outstanding, by written notice to the Company and
the Trustee, may rescind and annul such declaration and its
consequences if
(a) the Company has paid or deposited with the Trustee
a sum sufficient to pay,
(i) all overdue interest on all Notes,
(ii) all unpaid principal of (and premium, if any,
on) any Notes which has become due otherwise than by
such declaration of acceleration, and interest thereon
as provided herein,
(iii) to the extent that payment of such
interest is lawful, interest on overdue interest at the
rate borne by the Notes, and
(iv) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents
and counsel;
(b) all Events of Default, other than the non-payment
of principal of the Notes that has become due solely by such
declaration of acceleration, have been cured or waived as
provided in Section 413; and
(c) the rescission would not conflict with any
judgment or decree of a court of competent jurisdiction.
No such rescission shall affect any subsequent default or impair
any right consequent thereon.
Notwithstanding the preceding paragraph, in the event
of a declaration of acceleration in respect of the Notes because
of an Event of Default specified in Section 401(e) shall have
occurred and be continuing, such declaration of acceleration
shall be automatically annulled if the Indebtedness that is the
subject of such Event of Default has been discharged or the
holders thereof have waived all defaults in respect of such
Indebtedness triggering such acceleration and (if applicable)
rescinded their declaration of acceleration in respect of such
Indebtedness, and written notice of such discharge or waiver and
(if applicable) rescission, as the case may be, shall have been
given to the Trustee by the Company and countersigned by the
holders of such Indebtedness or a trustee, fiduciary or agent for
such holders, within 30 days after such declaration of
acceleration in respect of the Notes, and no other Event of
Default has occurred during such 30 day period which has not been
cured or waived during such period.
Notwithstanding any provision contained herein to the
contrary, the Trustee acknowledges that the Legal Requirements
may mandate either gaming approvals, liquor approvals, or both,
before, during or after the exercise of any right or remedy
provided for herein.
Section 403. Collection of Indebtedness and Suits for
Enforcement by Trustee.
The Company and each Guarantor covenant that if
(a) default is made in the payment of any installment
of interest on any Note when such interest becomes due and
payable and such default continues for a period of 10 days,
or
(b) default is made in the payment of the principal of
(or premium, if any, on) any Note at the Maturity thereof,
the Company and each Guarantor (and, in the case of each
Guarantor, subject to the provisions of Article Thirteen) will,
upon demand of the Trustee, pay to the Trustee for the benefit of
the Holders of such Notes, the whole amount then due and payable
on such Notes for principal (and premium, if any) and interest,
and interest on any overdue principal (and premium, if any) and,
to the extent that payment of such interest shall be legally
enforceable, upon any overdue installment of interest, at the
rate borne by the Notes, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel.
If the Company or any Guarantor, as the case may be,
fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may
(or, at the direction of Holders of not less than 25% of
Outstanding Notes shall) institute a judicial proceeding for the
collection of the sums so due and unpaid, may prosecute such
proceeding to judgment or final decree and may enforce the same
against the Company or any Guarantor or any other obligor upon
the Notes and collect the moneys adjudged or decreed to be
payable in the manner provided by law out of the property of the
Company or any Guarantor or any other obligor upon the Notes,
wherever situated.
If an Event of Default occurs and is continuing, the
Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect
and enforce any such rights, including seeking recourse from any
Guarantor pursuant to the terms of the Guarantee, whether for the
specific enforcement of any covenant or agreement in this
Indenture or in the other Noteholder Documents or in aid of the
exercise of any power granted herein, or to enforce any other
proper remedy. The Trustee may, in connection with the matters
covered by the two preceding paragraphs, take such actions under
any of the Noteholder Documents as shall be required or available
thereunder or under applicable law.
Section 404. Trustee May File Proofs of Claim.
In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Notes, including any
Guarantor, or assets or the property of the Company or of such
other obligor, including any Guarantor, or their creditors, the
Trustee (irrespective of whether the principal of the Notes shall
then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made
any demand on the Company or any Guarantor for the payment of
overdue principal, premium, if any, or interest) shall be
entitled and empowered, by intervention in such proceedings or
otherwise,
(i) to file and prove a claim for the whole amount of
principal (and premium, if any) and interest owing and
unpaid in respect of the Notes and to file such other papers
or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel) and of the
Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other
property payable or deliverable on any such claims and to
distribute the same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or similar official in any such judicial proceeding
is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section
507.
Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of
any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 405. Trustee May Enforce Claims Without
Possession of Notes.
All rights of action and claims under this Indenture,
the Guarantee or the Notes may be prosecuted and enforced by the
Trustee without the possession of any of the Notes or the
production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its
own name and as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Notes in respect of which such judgment has
been recovered.
Section 406. Application of Money Collected.
Subject to the provisions of Section 1112, any money
collected by the Trustee pursuant to the Indenture, the Notes,
the Guarantee or the Noteholder Documents shall be applied in the
following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal
(or premium, if any) or interest, upon presentation of the Notes
and the notation thereon of the payment if only partially paid
and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee
under Section 507;
SECOND: To the payment of all amounts due the Trustee
under the Noteholder Documents;
THIRD: To the payment of the amounts then due and
unpaid for principal of (and premium, if any, on) and
interest on the Notes in respect of which or for the benefit
of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts
due and payable on such Notes for principal (and premium, if
any) and interest, respectively; and
FOURTH: To the ratable payment of all other amounts
due the Holders under the Noteholder Documents; and
FIFTH: To the payment of the remainder, if any, to the
Company, its successors or assigns or to whomsoever may be
lawfully entitled to receive the same or as a court of
competent jurisdiction may direct.
Section 407. Limitation on Suits.
No Holder of any Notes shall have any right to
institute any proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee,
or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to
the Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in principal
amount of the Outstanding Notes shall have made written
request to the Trustee to institute proceedings in respect
of such Event of Default in its own name as Trustee
hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request;
(4) the Trustee for 15 days after its receipt of such
notice, request and offer of indemnity has failed to
institute any such proceedings; and
(5) no direction inconsistent with such written
request has been given to the Trustee during such 15-day
period by the Holders of a majority or more in principal
amount of the Outstanding Notes;
it being understood and intended that no one or more Holders
shall have any right in any manner whatever by virtue of, or by
availing itself of, any provision of this Indenture to affect,
disturb or prejudice the rights of any other Holders, or to
obtain or to seek to obtain priority or preference over any other
Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit
of all the Holders.
Section 408. Unconditional Right of Holders to Receive
Principal, Premium and Interest.
Notwithstanding any other provision in this Indenture,
the Holder of any Note shall have the right, which is absolute
and unconditional, to receive payment, as provided herein
(including, if applicable, Article Twelve) and in such Note, of
the principal of (and premium, if any, on) and interest on such
Note on the respective Stated Maturities expressed in such Note
(or, in the case of redemption, on the Redemption Date or in the
case of repurchase, on the Purchase Date) and to institute suit
for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
Section 409. Restoration of Rights and Remedies.
If the Trustee or any Holder 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, subject to any
determination in such proceeding, the Company, each of the
Guarantors, the Trustee and the Holders shall 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 410. Rights and Remedies Cumulative.
Except as otherwise provided in Section 206, no right
or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 411. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of
any Note to exercise any right or remedy accruing upon any Event
of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Indenture, the Notes, the
other Noteholder Documents, the Guarantee or by law to the
Trustee or to the Holders may be exercised from time to time, and
as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.
Section 412. Control by Holders.
The Holders of not less than a majority in principal
amount of the Outstanding Notes shall have the right to direct
the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee, provided that
(a) such direction shall not be in conflict with any
rule of law or with this Indenture,
(b) the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such
direction, and
(c) the Trustee need not take any action which might
involve it in personal liability or be unjustly prejudicial
to the Holders not consenting.
Section 413. Waiver of Past Defaults.
The Holders of not less than a majority in principal
amount of the Outstanding Notes may on behalf of the Holders of
all the Notes waive any past default hereunder and its
consequences, except a default
(1) in respect of the payment of the principal of (or
premium, if any, on) or interest on any Note, or
(2) in respect of a covenant or provision hereof which
under Article Eight cannot be modified or amended without
the consent of the Holder of each Outstanding Note affected.
Upon any such waiver, such default shall cease to
exist, and any Event of Default arising therefrom shall be deemed
to have been cured, for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other default or
Event of Default or impair any right consequent thereon.
Section 414. Environmental Laws and the Trustee.
Notwithstanding anything to the contrary contained in
this Indenture, or the other Noteholder Documents, in the event
the Trustee is entitled or required to commence an action to
foreclose on any Collateral or otherwise exercise its remedies to
acquire control or possession of any part of the Collateral and
solely to the extent that the Trustee shall have determined in
good faith that the indemnification provided to the Trustee under
Section 507(4) does not or will not adequately protect and
indemnify it from and against the foregoing liability, the
Trustee shall not be required to commence any such action or
exercise any such remedy with respect to such part of the
Collateral if the Trustee has determined in good faith (and upon
written advice of outside counsel) that the Trustee may incur
liability under the Environmental Laws as the result of the
presence at, or release on or from such part of the Collateral of
any Hazardous Materials unless the Trustee has received security
or indemnity, from a Holder or Holders, in an amount and in a
form all satisfactory to the Trustee, in its sole discretion,
protecting the Trustee from all such liability.
ARTICLE FIVE
THE TRUSTEE
The Trustee hereby accepts the trust imposed upon it by
this Indenture and covenants and agrees to perform the same as
herein expressed.
Section 501. Notice of Defaults.
Within 45 days after the occurrence of any Default
hereunder, unless such Default shall have been cured or waived,
the Trustee shall transmit by mail to all Holders, as their names
and addresses appear in the Note Register, notice of such Default
hereunder known to a Responsible Officer of the Trustee. Except
in the case of a Default in the payment of the principal of (or
premium, if any, on) or interest on any Note or in the payment of
any Redemption Price or Purchase Price, the Trustee may withhold
such notice if and so long as the board of directors, the
executive committee or a committee of Responsible Officers of the
Trustee in good faith determines that withholding such notice is
in the interest of the Holders. The provisions of Section 315(b)
of the Trust Indenture Act are hereby excluded from this
Indenture.
Section 502. Duties of Trustee.
(a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise its rights and powers
and use the same degree of care and skill in their exercise
as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs;
(b) Except during the continuance of an Event of
Default known to a Responsible Officer of the Trustee:
(1) the Trustee need perform only those duties
that are specifically set forth (or incorporated by
reference) in this Indenture or the other Noteholder
Documents and no others, and no covenants or
obligations shall be implied in or read into this
Indenture or the other Noteholder Documents which are
adverse to the Trustee; and
(2) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the
requirements of this Indenture or the other Noteholder
Documents ; provided, however, that the Trustee shall
examine reports, certificates and opinions specifically
required to be furnished to the Trustee under this
Indenture to determine whether or not they conform to
the requirements of this Indenture;
(c) 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
paragraph (b) of this Section 502;
(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 is negligent in
ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect
to action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to
Section 412 hereof;
(d) Every provision of this Indenture or the other
Noteholder Documents that in any way relates to the Trustee
is subject to this Section 502, including without
limitation, paragraphs (a), (b) and (c) of this Section 502;
and
(e) No provision of this Indenture or the other
Noteholder Documents 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 to take or omit to take any action under this Indenture
or the other Noteholder Documents or at the request, order
or direction of the Holders or in 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.
Section 503. Certain Rights of Trustee.
Subject to the provisions of Section 502:
(a) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Company Request
or Company Order and any resolution of the Board of
Directors may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture
or any other Noteholder Document the Trustee shall deem it
desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the
written advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it
hereunder in good faith in reliance thereon;
(e) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any of the Holders
pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness 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 to examine the books, records and premises
of the Company, personally or by agent or attorney during
regular business hours and upon reasonable prior
notification;
(g) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys, and the
Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed
with due care by it hereunder; and
(h) except with respect to Section 901 (including the
payment as and when due of any Redemption Price or Purchase
Price), the Trustee shall have no duty to inquire as to the
performance of the covenants set forth in Article Nine. In
addition, the Trustee shall not be deemed to have knowledge
of any Default or Event of Default except (i) any Event of
Default under Section 401(a) or 401(b) or (ii) any Default
or Event of Default of which (or of the facts forming the
basis of which) a Responsible Officer of the Trustee shall
have received written notification or obtained actual
knowledge.
All references in this Section 503 shall be deemed to
include the Trustee's duties under the Noteholder Documents.
Section 504. Trustee Not Responsible for Recitals or
Issuance of Notes.
The recitals contained herein and in the Notes, except
for the Trustee's certificates of authentication, shall be taken
as the statements of the Company and the Guarantors, and the
Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Notes, except that the
Trustee represents that it is duly authorized to execute and
deliver this Indenture, authenticate the Notes and perform its
obligations hereunder and under the other Noteholder Documents to
which it is a party and that the statements made by it in a
Statement of Eligibility and Qualification of Form T-1 supplied
to the Company are true and accurate, subject to the
qualifications set forth therein.
The Trustee makes no representations with respect to
the effectiveness or adequacy of any Noteholder Document, or the
validity, perfection or priority of Liens granted to it under
this Indenture or the Noteholder Documents. The Trustee shall
not be responsible for ascertaining or maintaining such validity,
perfection or priority and shall be fully protected in relying
upon certificates and opinions delivered to it in accordance with
the terms of this Indenture or the Noteholder Documents.
Section 505. May Hold Notes.
The Trustee, any Paying Agent, any Note Registrar or
any other agent of the Company or of the Trustee, in its
individual or any other capacity, may become the owner or pledgee
of Notes and, subject to TIA Sections 310(b) and 311, may
otherwise deal with the Company with the same rights it would
have if it were not Trustee, Paying Agent, Note Registrar or such
other agent.
Section 506. Money Held in Trust.
Money held by the Trustee in trust hereunder need not
be segregated from other funds except to the extent required by
law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed with
the Company.
Section 507. Compensation, Reimbursement and Indemnity.
The Company agrees:
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder
(which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express
trust);
(2) to reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or
made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it
harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of
or in connection with the acceptance or administration of
this trust, including the costs and expenses of defending
itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties
hereunder (the Trustee shall notify the Company promptly of
any claim for which it may seek indemnity); and
(4) without in any way limiting the foregoing
subsection (3), to indemnify the Trustee for, and hold it
harmless against, any loss or liability incurred by the
Trustee (including reasonable attorneys' and consultants'
fees and court costs) arising from or relating to any
Environmental Laws or Hazardous Materials concerning the
Collateral or any breach or alleged breach by the Company of
any representations, warranty or covenant in the Noteholder
Documents, provided such is not due to the Trustee's willful
violation of any Environmental Laws.
The obligations of the Company under this Section 507
to compensate the Trustee, to pay or reimburse the Trustee for
expenses, disbursements and advances and to indemnify and hold
harmless the Trustee shall constitute additional indebtedness
hereunder. To secure the Company's payment obligations in this
Section 507, the Trustee shall have a Lien (subject to Permitted
Liens) prior to that of the Holders upon all property and funds
held or collected by the Trustee as such, except funds held in
trust for the payment of principal of (and premium, if any, on)
or interest on particular Notes. When the Trustee incurs
expenses or renders services after an Event of Default specified
in Sections 401(h) or (i) occurs, the expenses and the
compensation for the services are intended to constitute expenses
of administration under any Bankruptcy Law.
The Company's obligations under this Section 507 and
any Lien arising hereunder shall survive the resignation or
removal of the Trustee, the discharge of the Company's
obligations pursuant to Article Three of this Indenture and any
rejection or termination of this Indenture under any Bankruptcy
Law.
The rights and protections set forth in Sections 503
and 507 afforded the Trustee pursuant to this Article Five shall
also be afforded the Note Registrar, the Paying Agent and the
Trustee in its capacity as collateral agent under the Noteholder
Documents.
Section 508. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which
shall be eligible to act as Trustee under TIA Sections 310(a)(1)
and 310(a)(5) and shall have a combined capital and surplus of at
least $100 million. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of federal, state, territorial or District of
Columbia supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of
such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so
published. 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. If at any time the Trustee shall
cease to be eligible in accordance with the provisions of this
Section, it shall resign in the manner and with the effect
hereinafter specified in this Article.
Section 509. Resignation and Removal; Appointment of
Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the
successor Trustee in accordance with the applicable requirements
of Section 510.
(b) The Trustee may resign at any time by giving
written notice thereof to the Company. If the instrument of
acceptance by a successor Trustee required by Section 510 shall
not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment
of a successor Trustee.
(c) The Trustee may be removed at any time by Act of
the Holders of not less than a majority in principal amount of
the Outstanding Notes, delivered to the Trustee and to the
Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the
provisions of TIA Section 310(b) after written request
therefor by the Company or by any Holder who has been a bona
fide Holder of a Note for at least six months, or
(2) the Trustee shall cease to be eligible under
Section 508 and shall fail to resign after written request
therefor by the Company or by any Holder who has been a bona
fide Holder of a Note for at least six months, or
(3) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of
the Trustee or of its property shall be appointed by any
public officer shall take charge or control of the Trustee
or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company, by a Board Resolution,
may remove the Trustee, or (ii) subject to TIA Section 315(e),
any Holder who has been a bona fide Holder of a Note for at least
six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor
Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of
Trustee for any cause, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee. Within one year after such
resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee may be appointed by Act of the
Holders of a majority in principal amount of the Outstanding
Notes by delivery of written notice thereof to the Company and
the retiring Trustee. If a successor Trustee is so appointed by
the Holders, such successor Trustee shall, forthwith upon its
acceptance of such appointment, become the successor Trustee and
supersede the successor Trustee appointed by the Company. If no
successor Trustee shall have been so appointed by the Company or
the Holders and accepted appointment in the manner provided in
Section 510, any Holder who has been a bona fide Holder of a Note
for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction
for the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation
and each removal of the Trustee and each appointment of a
successor Trustee to the Holders of Notes in the manner provided
for in Section 107. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.
Section 510. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall
execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and
thereupon, the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but,
on request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of its expenses, execute and deliver
an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee hereunder. Upon
request of any such successor Trustee, the Company shall execute
any and all instruments to more fully and certainly vest in and
confirm to such successor Trustee all such rights, powers and
trusts.
No successor Trustee shall accept its appointment
unless, at the time of such acceptance, such successor Trustee
shall be qualified and eligible under this Article. Both the
retiring Trustee and the successor Trustee shall be entitled to
receive an Opinion of Counsel stating that all conditions
precedent have been complied with and that the appointment of
such successor Trustee is enforceable against the Company,
subject to bankruptcy, insolvency, reorganization, moratorium,
arrangement or other similar laws relating to creditors' rights
generally, and general principles of equity (regardless whether
considered in a proceeding at law or in equity), including
concepts of materiality, reasonableness, good faith and fair
dealing and the possible unavailability of specific performance
or other equitable relief.
Section 511. Merger, Conversion, Consolidation or
Succession to Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the
corporate trust business of the Trustee, shall be the successor
of the Trustee hereunder, provided such corporation shall be
otherwise qualified and eligible under this Article, without the
execution or filing of any paper or any further act on the part
of any of the parties hereto. In case any Notes shall have been
authenticated, but not delivered, by the Trustee then in office,
any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver
the Notes so authenticated with the same effect as if such
successor Trustee had itself authenticated such Notes.
Section 512. Preferential Collection of Claims Against
Company.
The Trustee shall comply with TIA Section 311(a). A
Trustee who has resigned or been removed shall be subject to TIA
Section 311(a) to the extent indicated therein.
Section 513. Paying Agent; Note Registrar.
(a) Each Paying Agent or Note Registrar (other than
the Company) shall be a corporation organized and doing business
under the laws of the United States of America or of any State
and having a combined capital and surplus of at least
$500,000,000.
(b) Each Agent may resign at any time by giving
written notice thereof to the Company. The Company, by a Board
Resolution and upon giving written notice thereof to the Agent,
may remove each Agent at any time.
(c) If any Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of
any Agent for any cause, the Company, by a Board Resolution,
shall promptly appoint a successor Agent.
(d) The Company shall give notice of each resignation
and each removal of any Agent and each appointment of a successor
Agent by mailing written notice of such event by first-class
mail, postage prepaid, to the Trustee. Each Notice shall include
the name and address of the successor Agent.
(e) The Trustee is hereby initially appointed Paying
Agent and Note Registrar.
(f) The Company shall enter into an appropriate
written agency agreement with any Agent not a party to this
Indenture, which agreement shall implement the provisions of this
Indenture that relate to such Agent. The Company shall notify
the Trustee in writing of the name and address of any such Agent.
ARTICLE SIX
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 601. Disclosure of Names and Addresses of
Holders.
Every Holder of Notes, by receiving and holding the
same, agrees with the Company and the Trustee that neither the
Company, the Guarantors nor the Trustee shall be held accountable
by reason of the disclosure of any such information as to the
names and addresses of the Holders, regardless of the source from
which such information was derived, and that the Trustee shall
not be held accountable by reason of mailing any material
pursuant to a request made under TIA Section 312(b).
Section 602. Company to Furnish Trustee Names and
Addresses of Holders.
(a) The Company will furnish or cause to be furnished
to the Trustee
(i) semiannually, not more than five Business
Days after each Regular Record Date pertaining to the Notes,
a list, in such form as the Trustee may reasonably require,
of the names and addresses of the Holders as of such Regular
Record Date; and
(ii) at such other times as the Trustee may
request in writing, within 30 days after receipt by the
Company of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time
such list is furnished; provided, however, that if and so
long as the Trustee shall be the Note Registrar, no such
list need be furnished.
(b) If and whenever the Company, any Company
Subsidiary or any Affiliate of the Company or any Company
Subsidiary acquires any Notes, the Company shall within 10
Business Days after such acquisition by the Company or any
Company Subsidiary and within 10 Business Days after the
date on which it obtains knowledge of any such acquisition
by any Affiliate of the Company or any Company Subsidiary,
provide the Trustee with written notice of such acquisition,
the aggregate principal amount so acquired (to the extent
known by the Company), the Holder from whom such Notes were
acquired and the date of such acquisition.
Section 603. Preservation of Information;
Communications to Holders.
(a) The Trustee shall preserve, in as current a form
as is reasonably practicable, the names and addresses of Holders
contained in the most recent list furnished to the Trustee as
provided in Section 602 and the names and addresses of Holders
received by the Trustee in its capacity as Note Registrar. The
Trustee may destroy any list furnished to it as provided in
Section 602 upon receipt of a new list so furnished.
(b) If three or more Holders (referred to as
"applicants" in this Section 603(b)) apply in writing to the
Trustee and furnish to the Trustee reasonable proof that each
such applicant has owned a Note for a period of at least six
months preceding the date of such application, and such
application states that the applicants desire to communicate with
other Holders with respect to their rights under the Noteholder
Documents and is accompanied by a copy of the form of proxy or
other communication which such applicants propose to transmit,
then the Trustee shall, within five Business Days after the
receipt of such application, at its election, either:
(i) afford to such applicants access to the
information preserved at the time by the Trustee in
accordance with the provisions of Section 603(a); or
(ii) inform such applicants as to the approximate
number of Holders whose names and addresses appear in
the information preserved at the time by the Trustee in
accordance with the provisions of Section 603(a), and
as to the approximate cost of mailing to such Holders
the form of proxy or other communication, if any,
specified in such application.
If the Trustee shall elect not to afford to such
applicants access to such information, the Trustee shall, upon
the written request of such applicants, mail to each Holder whose
name and address appears in the information preserved at the time
by the Trustee in accordance with the provisions of Section
603(a), a copy of the form of proxy or other communication which
is specified in such request, with reasonable promptness after a
tender, to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses
of mailing, unless within five Business Days after such tender
the Trustee shall mail to such applicants and file with the
Commission, together with a copy of the material to be mailed, a
written statement to the effect that, in the opinion of the
Trustee, such mailing would be contrary to the best interests of
the Holders of Notes or would be in violation of applicable law.
Such written statement shall specify the basis of such opinion.
If the Commission, after opportunity for a hearing upon the
objection specified in the written statement so filed, shall
enter an order refusing to sustain any of such objections or if,
after the entry of any order sustaining one or more of such
objections, the Commission shall find, after notice and
opportunity for hearing, that all the objections so sustained
have been met, and shall enter an order so declaring, the Trustee
shall mail copies of such material to all such Holders with
reasonable promptness after the entry of such order and the
renewal of such tender; otherwise, the Trustee shall be relieved
of any obligation or duty to such applicants respecting their
application.
Section 604. Reports by Trustee.
To the extent required by the Trust Indenture Act, on
or before July 15 of each year commencing with the first July 15
after the date of this Indenture, the Trustee shall transmit by
mail to the Company and to all Holders, if required, as provided
in Section 313(c) of the Trust Indenture Act, a brief report
dated as of the immediately preceding May 15 that complies with
Section 313(a) of the Trust Indenture Act. The Trustee also
shall comply with Section 313(b) of the Trust Indenture Act.
If and so long as this Indenture is qualified under the
Trust Indenture Act, a copy of each such report shall, at the
time of such transmission to Holders, be filed by the Trustee
with each stock exchange upon which the Notes are listed (if
any), with the Commission and with the Company. The Company will
notify the Trustee if and when the Notes are listed on any stock
exchange.
Section 605. Reports by Company.
If and so long as this Indenture is qualified under the
Trust Indenture Act, the Company shall:
(a) file with the Trustee, within 15 days after the
Company or any Guarantor is required to file the same with the
Commission, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules
and regulations prescribe) that the Company or any Guarantor may
be required to file with the Commission pursuant to Section 13,
14 or Section 15(d) of the Exchange Act; or, if the Company is
not required to file information, documents or reports pursuant
to any of such Sections, then it shall file with the Trustee and
the Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports
that may be required pursuant to Section 13 of the Exchange Act
in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in
such rules and regulations;
(b) file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to
time by the Commission, such additional information, documents
and reports with respect to compliance by the Company and the
Guarantors with the conditions and covenants of this Indenture as
may be required from time to time by such rules and regulations;
and
(c) transmit by mail to all Holders, as provided in
Section 313(c) of the Trust Indenture Act, within five days after
the filing thereof with the Trustee, summaries of any
information, documents and reports required to be filed by the
Company or any Guarantor pursuant to subsections (a) and (b) of
this Section 605 as may be required by rules and regulations
prescribed from time to time by the Commission.
The Company shall also comply with the other
provisions of Section 314(a) of the Trust Indenture Act to the
extent such provisions are applicable.
ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 701. Company May Consolidate, Etc., Only on
Certain Terms.
Except as part of a Restricted Asset Sale involving a
Subject Subsidiary that is permitted pursuant to Section 917,
neither the Company nor any Company Subsidiary shall consolidate
with or merge with or into or wind up into another Person or,
directly or indirectly, sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its properties
or assets, whether in a single transaction or a series of related
transactions, to another Person or group of affiliated Persons,
except that the Company may consolidate with or merge with or
into or sell, assign, convey, lease or transfer all or
substantially all of its properties and assets to any Person or
group of affiliated Persons in a single transaction or through a
series of transactions:
(a) if (i) the Company shall be the continuing Person
or the resulting, surviving or transferee Person (the "surviving
entity") shall be a corporation organized under the laws of the
United States, any state thereof or the District of Columbia,
(ii) the surviving entity expressly assumes by supplemental
indenture or other appropriate document all of the obligations of
the Company in connection with the Noteholder Documents, the
Notes and the Indenture (including any Liens thereunder) and the
Company shall have taken all steps necessary or desirable to
perfect and protect the Noteholder Security Interest granted or
purported to be granted by the Noteholder Documents and
(iii) each Guarantor shall have entered into amendments to the
Guarantee to reflect the guarantee of the obligations of the
surviving entity and the Company has delivered to the Trustee an
Opinion of Counsel that all such steps have been taken;
(b) immediately before and immediately after giving
effect to such transaction, or series of transactions (including,
without limitation, any Indebtedness incurred or anticipated to
be incurred in connection with or in respect of such transaction
or series of transactions), no Default or Event of Default shall
have occurred and be continuing;
(c) the Company or the surviving entity (if the
transaction or series of transactions involves the Company) shall
immediately before and after giving effect to such transaction or
series of transactions (including, without limitation, any
Indebtedness incurred or anticipated to be incurred in connection
with or in respect of the transaction or series of transactions)
have a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of the Company immediately prior to such
transaction or series of transactions;
(d) immediately after giving effect to such
transaction or series of transactions on a pro forma basis, the
Company or the surviving entity could incur at least $1.00 of
additional Indebtedness pursuant to clause (c) of Section 911;
(e) the Company or the surviving entity shall have
delivered to the Trustee an Officer's Certificate and an Opinion
of Counsel stating that such consolidation, merger, conveyance,
transfer or lease and, if a supplemental indenture is required in
connection with such transaction or series of transactions, such
supplemental indenture, complies with this covenant and that all
conditions precedent in the Indenture and the Noteholder
Documents relating to the transaction or series of transactions
have been satisfied;
(f) such transaction will not result in the loss of
any Gaming License or other license necessary for the continued
operations of the Company or any Company Subsidiary as conducted
immediately prior to such consolidation, merger, conveyance,
transfer or lease;
(g) neither the Company nor any Company Subsidiary
would thereupon become obligated with respect to any
Indebtedness, nor any of its property subject to any Lien, unless
the Company or such Company Subsidiary could incur such
Indebtedness or create such Lien under each of the Noteholder
Documents; and
(h) each Guarantor shall have by supplemental
indenture confirmed that its Guarantee shall apply to the
Company's or the surviving entity's obligations under this
Indenture and the Notes and the other Noteholder Documents.
Section 702. Successor Substituted.
Upon any consolidation, merger or disposal of all or
substantially all of the assets of the Company in accordance with
Section 701, the successor Person formed by such consolidation or
into which the Company is merged or the successor Person to which
such disposition is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under
this Indenture, the Notes and the other Noteholder Documents,
with the same effect as if such successor had been named as the
Company herein or therein. Any such Person will be required to
ensure, by executing and delivering appropriate instruments and
opinions of counsel, that the Trustee continues to hold the
Noteholder Security Interest with the required priority on all
Collateral for the benefit of the Holders of the Notes.
Section 703. Redemption.
The provisions of this Article Seven shall not impair
the Holders' right of repurchase following a Change of Control as
provided in Section 1011 herein.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES,
AMENDMENTS AND WAIVERS
Section 801. Supplemental Indentures and Amendments
Without Consent of Holders.
Without the consent of any Holders, the Company and any
Company Subsidiary, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto or amendments to the
Indenture (including any amendment to the Guarantee), the Notes
or the Noteholder Documents, in form satisfactory to the Trustee,
for any of the following purposes:
(a) to evidence the succession of another Person to
the Company, in accordance with Article Seven, or a Subject
Subsidiary, in accordance with a Restricted Asset Sale
permitted pursuant to Section 917, and the assumption by any
such successor of the covenants of the Company, in
accordance with Article Seven, or such Subject Subsidiary,
in accordance with a Restricted Asset Sale permitted
pursuant to Section 917, contained herein, in the Notes, in
the Noteholder Documents or in the Guarantee; or
(b) to add to the covenants of the Company or any
Company Subsidiary or Guarantor for the benefit of the
Holders or to surrender any right or power herein conferred
upon the Company or any Company Subsidiary or Guarantor; or
(c) to add any additional Events of Default; or
(d) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee pursuant to the
requirements of Section 510 hereof; or
(e) to cure any ambiguity, to correct or supplement
any provision herein, in the Noteholder Documents, in the
Notes or in the Guarantee which may be inconsistent with any
other provision herein or therein, or to make any other
provisions with respect to matters or questions arising
under this Indenture, under the Noteholder Documents or
under the Guarantee that shall not be inconsistent with the
provisions herein or therein; provided that, in each case,
any such provisions shall not adversely affect the interests
of the Holders; or
(f) to comply with Sections 1314 and 1318 hereof; or
(g) to effectuate any release of Collateral expressly
permitted by Section 1105; or
(h) to establish or maintain the Noteholder Security
Interest as a senior, first priority Lien (subject only to
Permitted Liens) and prior to all other Liens (other than
Permitted Liens) or to correct or amplify the description of
any Collateral subject to the Noteholder Security Interest,
or to subject additional property to the Lien of this
Indenture or other Noteholder Documents; or
(i) to comply with any requirement of the Commission
or state securities regulators in connection with the
qualification of the Indenture under the TIA or any
registration or qualification of the Notes under the
Securities Act or state securities laws.
Section 802. Supplemental Indentures and Amendments
with Consent of Holders.
(a) Subject to Section 408, with the written consent
of the Holders of a majority in principal amount of the
Outstanding Notes, by Act of such Holders delivered to the
Company and the Trustee, the Company and the Guarantors,
when authorized by a Board Resolution, and the Trustee may
amend or supplement the Indenture, the Noteholder Documents
or the Notes for the purpose of adding any provisions to or
changing in any manner or eliminating or waiving any of the
provisions of this Indenture, the Noteholder Documents or
the Notes or of modifying in any manner the rights of the
Holders under this Indenture, the Noteholder Documents or
the Notes; provided, however, that
(i) no such amendment, supplement or waiver
shall, without the consent of the Holder of each
Outstanding Note affected thereby,
(A) extend the Stated Maturity of the principal
of, or any installment of interest on, any Note, or
reduce the principal amount thereof or the rate of
interest thereon or any premium payable upon the
redemption or repurchase thereof or the Default Premium
Amount payable pursuant to Section 402, or change the
coin or currency in which the principal of any Note or
any premium or the interest thereon is payable, or
impair the right to institute suit for the enforcement
of any such payment after the Stated Maturity thereof
(or, in the case of redemption, after the Redemption
Date or, in the case of repurchase, after the Purchase
Date), or affect the ranking (in terms of right or time
of payment) of the Notes or the Guarantee,
(B) release any Guarantor from the Guarantee or
amend Article Thirteen, except as contemplated by
Section 801(a),
(C) except as expressly provided in Section
801(a), 914 or 1105 or the Noteholder Documents,
release any Collateral, permit the creation of any Lien
senior to or ranking equally with the Noteholder
Security Interest, deprive the Holders of the security
of the Collateral, or amend Section 914, 917, 922, or
923, or Article Eleven,
(D) reduce the percentage in principal amount of
the Outstanding Notes the consent of whose Holders is
required for any such supplemental indenture, or the
consent of whose Holders is required for any waiver (of
compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences)
provided for in this Indenture,
(E) modify any provision of Article Ten or the
definitions used therein if the effect of such
modification or waiver is to decrease the amount of any
payment required to be made by the Company thereunder
or extend the Maturity Date of such payment,
(F) modify in any respect Section 408, or
(G) modify any of the provisions of this Section
802 or Section 413, except to increase any such
percentage or to provide that certain other provisions
of this Indenture cannot be modified or waived without
the consent of the Holder of each Note affected
thereby; and
(ii) no such supplemental indenture shall,
without the consent of the Holders of 66-2/3% in
principal amount of the Outstanding Notes, modify
Section 1011 in any respect or modify in any respect,
or waive a Default or Event of Default under,
Section 401(m).
(b) It shall not be necessary for any Act of Holders
under this Section 802 to approve the particular form of any
proposed supplemental indenture, but it shall be sufficient if
such Act and such notice shall approve the substance thereof.
Section 803. Execution or Acceptance of Supplemental
Indentures, Amendments and Waivers.
In executing, or accepting the additional trusts
created by, any supplement, amendment or waiver permitted by this
Article Eight or the modifications thereby of the trusts created
by this Indenture, the Trustee shall receive, and (subject to
Section 502) shall be fully protected in relying upon, an Opinion
of Counsel stating that this Indenture, the Guarantee, the Notes
and the Noteholder Documents, as amended by such supplement,
amendment or waiver, constitute the legal, valid and binding
obligations of the Company and the Guarantors, enforceable
against each of them in accordance with its terms.
No waiver of any term, provision or condition contained
in the Notes, the Indenture, or the Noteholder Documents shall
extend to or affect such term, provision or condition except to
the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the
Guarantors and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and
effect.
Section 804. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture or
amendment under this Article, this Indenture, the Notes, or the
Noteholder Documents, as the case may be, shall be modified in
accordance therewith, and such supplemental indenture or
amendment shall form a part of this Indenture, the Notes, or the
Noteholder Documents, as the case may be, for all purposes, and
every Holder of Notes theretofore or thereafter authenticated and
delivered hereunder shall be bound thereby and entitled to the
benefits thereof (including the benefits of any amendment to the
Guarantee).
Section 805. Conformity with Trust Indenture Act.
Every supplemental indenture or amendment made pursuant
to this Article shall conform to the requirements of the TIA as
then in effect.
Section 806. Reference in Notes to Supplemental
Indentures, Amendments or Waivers.
Notes authenticated and delivered after any supplement,
amendment or waiver has been made pursuant to this Article Eight
may, and shall if required by the Trustee, bear a notation in
form acceptable to the Trustee as to any matter provided for in
such supplemental indenture. If the Company shall so determine,
new Notes so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any such supplement,
amendment or waiver may be prepared and executed by the Company
and the Guarantors and authenticated and delivered by the Trustee
in exchange for Outstanding Notes. Without limiting Section 804,
in the case of any amendment to the Guarantee to add a Guarantor
to the Guarantee, whether or not any or all new Notes are so
executed, authenticated and exchanged for previously Outstanding
Notes, the Guarantor added to the Guarantee by such amendment
shall be obligated with respect to the Guarantee as if all
Outstanding Notes had been exchanged for Notes executed by the
Company and all Guarantors, including such added Guarantor.
ARTICLE NINE
COVENANTS
Section 901. Payment of Principal, Premium, If Any, and
Interest.
The Company will duly and punctually pay the principal
of (and premium, if any, on) and interest on the Notes in
accordance with the Notes and this Indenture.
Section 902. Maintenance of Note Register, Note
Registrar and Paying Agent.
The Company shall maintain or cause to be maintained in
the State of New York and the City of New York, (i) an office or
agency where Notes may be presented for registration of transfer
or exchange and at which the Notes registrar will be maintained;
and (ii) an office or agency where Notes may be presented for
payment by the Paying Agent. The Note Registrar shall maintain
the Note Register. The Company may appoint the Paying Agent, the
Note Registrar, one or more co-note registrars, and one or more
additional paying agents. The terms "Paying Agent" and "Note
Registrar" include any additional paying agent or co-
note registrar. The Trustee hereby designates the office of
Shawmut Trust Company, 14 Wall Street, 8th Floor, New York, New
York 10005, as the office of the Trustee at which Notes may be
presented for payment or presented for registration of transfer
or exchange in accordance with the terms of this Indenture as
long as the Trustee acts as Note Registrar or Paying Agent.
Section 903. Money for Note Payments to Be Held in
Trust.
If the Company shall at any time act as its own Paying
Agent, it will, on or before each due date of the principal of
(and premium, if any, on) or interest on any of the Notes,
segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal (and
premium, if any) or interest so becoming due until such sums
shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or
failure so to act.
Whenever the Company shall have one or more Paying
Agents for the Notes, it will, on or before each due date of the
principal of (and premium, if any, on), or interest on, any
Notes, timely deposit with a Paying Agent in immediately
available funds a sum sufficient to pay the principal (and
premium, if any) or interest so becoming due, such sum to be held
in trust for the benefit of the Persons entitled to such
principal, premium or interest, and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of such
action or any failure so to act.
The Company will cause each Paying Agent (other than
the Trustee) to execute and deliver to the Trustee an instrument
in which such Paying Agent shall agree with the Trustee, subject
to the provisions of this section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of (and premium, if any, on) or interest on Notes
in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(2) give the Trustee notice of any default by the
Company (or any other obligor upon the Notes) in the making
of any payment of principal (and premium, if any) or
interest; and
(3) at any time during the continuance of any such
default, upon the written request of the Trustee, forthwith
pay to the Trustee all sums so held in trust by such Paying
Agent.
The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture or for
any other purpose, pay, or by Company Order direct any Paying
Agent to pay, to the Trustee all sums held in trust by the
Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by
the Company or such Paying Agent, and, upon such payment by any
Paying Agent to the Trustee, such Paying Agent shall be released
from all further liability with respect to such sums.
Any money deposited with the Trustee or any Paying
Agent, or then held by the Company, in trust for the payment of
the principal of (and premium, if any, on) or interest on any
Note and remaining unclaimed for two years after such principal
(and premium, if any) or interest has become due and payable
shall, subject to applicable escheat laws, be paid to the Company
on Company Request, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all
liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent,
subject to applicable escheat laws, before being required to make
any such repayment, may at the expense (and upon written request)
of the Company cause to be published once, in The New York Times
and The Wall Street Journal (national edition), and mail to each
such Holder, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30
days from the date of such publication, any unclaimed balance of
such money then remaining will, subject to applicable escheat
laws, promptly be repaid to the Company.
Section 904. Corporate Existence and Keeping of Books.
Subject to Article Seven and Section 917, the Company
will do or cause to be done all things necessary to preserve and
keep in full force and effect the corporate, partnership or other
existence, rights (charter and statutory) and franchises of the
Company and each of the Company Subsidiaries. The Company will
keep, and cause each of the Company Subsidiaries to keep, proper
records and books of account, in which full and correct entries
shall be made of all financial transactions and the assets and
business of the Company and each such Company Subsidiary in
accordance with GAAP in all material respects.
Section 905. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid
or discharged, before the same shall become delinquent, (a) all
taxes, assessments and governmental charges levied or imposed
upon the Company or any Company Subsidiary or any of their
respective properties and (b) all lawful claims for labor,
materials and supplies, which, if unpaid, might by law become a
Lien upon the property of the Company or any Company Subsidiary;
provided, however, that except as otherwise provided in the
Noteholder Documents, the Company and any such Company Subsidiary
shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim (i) that is
being contested in good faith by appropriate proceedings and for
which adequate reserves have been established as required by GAAP
or (ii) if the failure to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim would not
have a material adverse effect on the financial condition,
results of operations, business or properties of the Company and
the Company Subsidiaries taken as a whole.
Section 906. Maintenance of Properties.
With respect to all properties owned by the Company or
any Company Subsidiary or used or held for use in the conduct of
its business or the business of any Company Subsidiary, the
Company will, and will cause the Company Subsidiaries to,
maintain and keep such property in good condition, repair and
working order and supplied with all necessary equipment and will
cause all necessary repairs, renewals, replacements, betterments
and improvements thereof to be made, all as required by the
Noteholder Documents and as otherwise may be necessary so that
the business carried on in connection therewith may be properly
and advantageously conducted at all times; provided, however,
that nothing in this Section shall prevent the Company and the
Company Subsidiaries from discontinuing the maintenance of any of
such properties if such discontinuance is (i) in the judgment of
the Company or such Company Subsidiary (which shall, in the case
of properties having an aggregate value of $500,000 or more, be
evidenced by a Board Resolution of the Board of Directors),
desirable in the conduct of the business of the Company or any
Company Subsidiary and (ii) not disadvantageous in any material
respect to the Holders.
Section 907. Insurance.
(a) The Company shall, and shall cause the Company
Subsidiaries to, have in effect customary insurance against such
risks, on terms, with deductibles and in amounts as are
customarily carried by similar businesses conducting gaming in
the jurisdictions of the gaming operations of the Company and the
Company Subsidiaries and reasonably sufficient to avoid a
material adverse change in the financial condition, results of
operation, business or properties of the Company and the Company
Subsidiaries taken as a whole. All such insurance shall be
issued by carriers having an A.M. Best & Company, Inc. rating of
A- or higher, or if such carrier is not rated by A.M. Best &
Company, Inc., having the financial stability and size deemed
appropriate by a reputable insurance broker.
(b) Without limitation of subsection (a) of this
Section 907, customary insurance coverage for the purposes of
this Section 907 shall include, where appropriate, the following:
(i) workers' compensation insurance in full compliance with all
applicable state and federal laws and regulations, (ii) property
insurance protecting property against loss or damage by fire,
lightning, windstorm, tornado, water damage, vandalism, riot,
civil commotion, malicious mischief, hurricane, and such other
risks and hazards as are from time to time covered by an "all-
risk" policy or a property policy covering "special" causes of
loss, (iii) business interruption insurance and (iv) such other
insurance as is in effect on the date hereof, in the case of each
of (i), (ii), (iii) and (iv) in amounts and with deductibles and
other significant terms at least as favorable as those in effect
on the date hereof (which are described on Schedule 907).
(c) All insurance shall name the Trustee as an
additional insured (in the case of liability insurance) or loss
payee (in the case of casualty insurance with respect to
Collateral), as applicable. To the extent obtainable on
commercially reasonable terms, all required insurance shall
contain an endorsement or agreement by the insurer (i) that any
loss shall be payable in accordance with the terms of such policy
notwithstanding any act or negligence of the Company and the
Company Subsidiaries that might otherwise result in forfeiture of
such insurance, (ii) that such policies will not be canceled or
materially amended, which term shall include any reduction in the
scope or limits of coverage, without at least 20 days prior
written notice to the Trustee, (iii) providing for no recourse to
the Holders for the payment of premiums and waiving all rights of
set off, counterclaim or deductions against the Trustee and
(iv) that its liability to the Trustee will not be affected by
acts outside of the Trustee's control. All policies of required
casualty insurance shall have attached thereto a lender's loss
payable endorsement for the benefit of the Holders.
Section 908. Statement by Officers as to Default.
(a) The Company will deliver to the Trustee, on or
before a date not more than 45 days after the end of the first,
second and third fiscal quarters of each fiscal year of the
Company and not more than 90 days after the end of each fiscal
year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not, after a review under each
signer's supervision of the activities of the Company and the
Company Subsidiaries during such fiscal quarter or fiscal year,
as the case may be, and of the performance of the Company and
each Company Subsidiary under this Indenture and the other
Noteholder Documents, to the best knowledge, based on such
review, of the signers thereof, a Default or Event of Default has
occurred during such fiscal quarter or fiscal year, as the case
may be, and, if there has been a Default or Event of Default that
is continuing, specifying each Default or Event of Default and
the nature and status thereof. Each such statement shall comply
with Section 314(a)(4) of the Trust Indenture Act and shall,
commencing with the fiscal quarter ending March 31, 1998, set
forth all computations, in reasonable detail satisfactory to the
Trustee, demonstrating compliance with the provisions of
Section 924.
(b) When the Company is aware that any Default, or
Event of Default or if any holder or the trustee for the holder
of any other evidence of Indebtedness of the Company or any
Company Subsidiary gives any notice to the Company or takes any
other action of which the Company is aware with respect to a
claimed default, the Company shall deliver to the Trustee by
registered or certified mail or by telegram, telex or facsimile
transmission an Officers' Certificate specifying such event,
notice or other action within three Business Days after the
Company becomes aware of its occurrence.
Section 909. Provision of Financial Statements.
(a) The Company shall file with the Trustee, within 15
days after it files them with the Commission, copies of the
annual, quarterly and periodic reports, and of the information,
documents and other reports, which the Company is required to
file with the Commission pursuant to Section 13, 14 or 15(d) of
the Exchange Act. If the Company is not subject to the
requirements of Section 13, 14 or 15(d) of the Exchange Act, the
Company shall file with the Trustee, within 15 days after it
would have been required to file such information with the
Commission were it subject to Section 13, 14 or 15(d) of the
Exchange Act, financial statements, including any notes thereto
(and with respect to annual reports, an auditors' report by a
firm of established national reputation), and a "Management's
Discussion and Analysis of Financial Condition and Results of
Operations," both comparable to that which the Company would have
been required to include in the annual and quarterly reports the
Company would have been required to file if the Company were
subject to the requirements of Section 13, 14 or 15(d) of the
Exchange Act. The Company also shall comply with the provisions
of TIA Section 314(a).
(b) If the Company is required to furnish annual or
quarterly reports to its stockholders pursuant to the Exchange
Act, so long as any Notes remain outstanding, the Company shall
cause any annual report to stockholders and any quarterly or
other financial reports furnished by it to stockholders to be
filed with the Trustee at the time of such mailing or furnishing
to stockholders. If the Company is not required to furnish
annual or quarterly reports to its stockholders pursuant to the
Exchange Act, the Company shall cause its financial statements
referred to in Section 909(a) above, including any notes thereto
(and with respect to annual reports, an auditors' report by a
firm of established national reputation), and a "Management's
Discussion and Analysis of Financial Condition and Results of
Operations," comparable to that which would have been required to
appear in annual or quarterly reports filed under Section 13 or
15(d) of the Exchange Act to be filed with the Trustee within 105
days after the end of each of the Company's fiscal years and
within 60 days after the end of each of the Company's first three
fiscal quarters of such fiscal year. The Company shall file with
the Trustee and the Commission, in accordance with rules and
regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to
compliance by the Company with the conditions and covenants of
this Indenture as may be required from time to time by such rules
and regulations. The Trustee will make such reports available
for inspection and copying by, and will provide copies to, each
Holder requesting the reports described in this Section 909(b).
(c) The Company shall provide the Trustee with a
sufficient number of copies of all reports and other documents
and information that the Trustee may be required to provide to
the Holders upon request under Section 909(b) to permit the
Trustee to satisfy that requirement.
(d) If any Company Subsidiary is required to file
reports or other information with the Commission pursuant to
Section 13, 14 or 15(d) of the Exchange Act separately from the
Company, the Company shall file or cause to be filed with the
Trustee, and supply or cause to be supplied to each Holder of
Notes, without cost to such Holder, copies of such reports or
other information, within fifteen days after the same shall be
filed with the Commission.
Section 910. Compliance with Laws, Etc.
The Company will comply, and cause each of the Company
Subsidiaries to comply, with all applicable laws, unless the
failure to so comply would not have a material adverse effect on
the financial condition, results of operations, business or
properties of the Company and the Company Subsidiaries taken as a
whole.
Section 911. Limitation on Company Indebtedness.
The Company shall not, and shall not permit any of the
Company Subsidiaries to, directly or indirectly, create, incur,
assume, suffer to exist, guarantee or in any manner become
directly or indirectly liable for the payment of ("incur"), any
Indebtedness other than:
(a) Indebtedness under the Notes, the Indenture and
the other Noteholder Documents;
(b) Bank Indebtedness and any renewals, replacements
and/or refinancings thereof, so long as the aggregate
principal amount of Bank Indebtedness at any one time
outstanding pursuant to this paragraph (b) does not exceed
the Bank Indebtedness Amount;
(c) Any Indebtedness, if (i) no Default or Event of
Default shall have occurred and be continuing at the time
of, or would occur after giving effect to, on a pro forma
basis, such incurrence of such Indebtedness and
(ii) immediately after giving effect to the incurrence
thereof, and the receipt and the application of the proceeds
thereof, the Consolidated Coverage Ratio would be greater
than (A) 1.75 to 1, in the case of such Indebtedness
incurred or to be incurred on or prior to December 31, 1996
and (B) 2.0 to 1, in the case of such Indebtedness incurred
or to be incurred on or after January 1, 1997; provided that
any such Indebtedness shall mature at a date not earlier
than the Stated Maturity of the Notes and shall have an
Average Life to Stated Maturity equal to or greater than the
remaining Average Life to Stated Maturity of the Notes;
(d) Any Indebtedness issued in exchange for or to
repay, prepay, repurchase, redeem, defease, retire or
refinance ("refinance") any Indebtedness permitted by
clauses (a) or (c) above; provided that (i) if the principal
amount of the Indebtedness so issued shall exceed the
principal amount of the Indebtedness so exchanged or
refinanced, then such excess shall be permitted only to the
extent that it is otherwise permitted to be incurred under
this Section 911 and (ii) the Indebtedness so issued (A) has
a Stated Maturity later than the Stated Maturity of the
Indebtedness so exchanged or refinanced, (B) has an Average
Life to Stated Maturity equal to or greater than the
remaining Average Life to Stated Maturity of the
Indebtedness so exchanged or refinanced, and (C) is
subordinated to the Notes to at least the same extent as the
Indebtedness so exchanged or refinanced.
Section 912. Limitation on Company Subsidiary Stock.
The Company shall not sell, and shall not cause or
permit any Company Subsidiary to issue or sell directly or
indirectly, any of the Capital Stock of such Company Subsidiary
(including, without limitation, any of its Common Stock,
Preferred Stock or Disqualified Stock) to any Person other than
the Company or a wholly-owned Company Subsidiary.
Section 913. Limitation on Restricted Payments.
The Company shall not, and shall not permit any of the
Company Subsidiaries to, make, directly or indirectly, any
Restricted Payment if, after giving effect thereto, on a pro
forma basis:
(a) a Default or Event of Default shall have occurred
and is continuing or would occur as a consequence thereof;
(b) the Company would not have been permitted, at the
time of such Restricted Payment and after giving pro forma
effect thereto as if such Restricted Payment had been made
at the beginning of the applicable Reference Period, to
incur at least $1.00 of additional Indebtedness pursuant to
Section 911(c); or
(c) the aggregate amount of all Restricted Payments
declared or made after the Issue Date would exceed the sum
of a (i) 50% of the aggregate Consolidated Net Income (or in
the event such Consolidated Net Income shall be a deficit,
minus 100% of such deficit) accrued during the period
(treated as one accounting period) commencing on the first
full fiscal quarter commencing after the Issue Date, to and
including the last day of the fiscal quarter ended
immediately prior to the date of each such calculation,
minus (ii) 100% of the amount of any write downs, write-
offs, or negative extraordinary charges not otherwise
reflected in Consolidated Net Income during such period,
plus (iii) an amount equal to the aggregate Net Cash
Proceeds received by the Company from the issuance or sale
(other than to a Company Subsidiary) of its Capital Stock
(excluding Disqualified Stock, but including Capital Stock
issued upon conversion of convertible Indebtedness and from
the exercise of options, warrants or rights to purchase
Capital Stock (other than Disqualified Stock) of the
Company) after the Issue Date;
provided, however, that the foregoing provisions will not
prevent, provided that no Default or Event of Default shall have
occurred and be continuing at the time of and after giving effect
to such Restricted Payment: (i) the payment of any dividend
within 60 days after the date of its declaration if, at the date
of declaration, such payment would be permitted by such
provisions; (ii) the payment of dividends or the making of
distributions on shares of Capital Stock of the Company solely in
shares of Capital Stock of the Company; and (iii) Restricted
Payments not otherwise permitted by this Section 913 which do not
exceed $200,000 in any fiscal year.
Section 914. Limitation of Liens.
The Company shall not, and shall not permit any of the
Company Subsidiaries to, create, incur, assume or suffer to exist
any Lien in or on any right, title or interest to any of their
properties or assets (including, without limitation, any income
or profits) now owned or hereafter acquired by it, other than
Permitted Liens.
Section 915. Limitation on Dividends and Other Payment
Restrictions Affecting Company
Subsidiaries.
The Company shall not, and shall not permit any of the
Company Subsidiaries to, directly or indirectly, create, assume
or suffer to exist any consensual encumbrance or restriction on
the ability of such Company Subsidiary to pay dividends, or make
any other distributions on the Capital Stock of such Company
Subsidiary or pay any obligation to the Company or the Company
Subsidiaries, or otherwise transfer assets or make or pay loans
or advances to the Company or any Company Subsidiary, except
(a) restrictions imposed by the Noteholder Documents;
(b) restrictions set forth on Schedule 915;
(c) customary non-assignment provisions restricting
subletting or assignment of any lease entered into in the
ordinary course of business, consistent with industry
practices,
(d) restrictions imposed by applicable Gaming Laws or
Liquor Laws or any applicable Gaming Authority or Liquor
Authority,
(e) restrictions under any agreement relating to any
property, assets or business acquired by the Company or the
Company Subsidiaries, which restrictions existed at the time
of acquisition, were not put in place in anticipation of
such acquisition and are not applicable to any Person, other
than the Person acquired or to any property, assets or
business other than the property, assets and business of the
Person so acquired,
(f) any restrictions (continuing for a period of not
more than 90 consecutive days) with respect to Capital Stock
or assets, as the case may be, of a Subject Subsidiary
imposed pursuant to an agreement that has been entered into
for the sale or disposition, constituting a Restricted Asset
Sale permitted under Section 917, of all or substantially
all of the Capital Stock or assets of such Subject
Subsidiary, and
(g) replacements of restrictions imposed pursuant to
clauses (a) through (e) that are no more restrictive than
those being replaced.
Section 916. Limitation on Sale-Leaseback Transactions.
The Company shall not, directly or indirectly, and
shall not permit any of the Company Subsidiaries to, directly or
indirectly, enter into, guarantee or otherwise become liable with
respect to any Sale-Leaseback Transaction unless (a) after giving
effect to any such Sale-Leaseback Transaction the Company could
incur $1.00 of additional Indebtedness pursuant to Section
911(c), (b) such Sale-Leaseback Transaction is otherwise
permitted under Section 914, (c) the consideration received by
the Company and/or any of the Company Subsidiaries for such Sale-
Leaseback Transaction are at least equal to the Fair Market Value
of such property being transferred, and (d) the Company shall
apply the Net Cash Proceeds of the sale as provided under Section
917. Notwithstanding anything contained in this covenant, the
Company shall not, and shall not permit any of the Company
Subsidiaries to, directly or indirectly, enter into, guarantee or
otherwise become liable with respect to any Sale-Leaseback
Transaction with respect to any Collateral.
Section 917. Limitation on Restricted Asset Sales.
(a) The Company shall not, and shall not permit any
Subject Subsidiary to, directly or indirectly, make any
Restricted Asset Sale unless (i) at the time of such Restricted
Asset Sale, the Company or such Subject Subsidiary, as the case
may be, receives consideration at least equal to the Fair Market
Value of the assets sold or otherwise disposed of; (ii) at least
90% in value of the form of the consideration therefore received
by the Company or such Subject Subsidiary is in U.S. Dollars;
provided, however, that the amount of (A) any liabilities (as
shown on the Company's or the Subject Subsidiary's most recent
balance sheet or in the notes thereto) of the Company or any
Subject Subsidiary that are assumed by the transferee in any such
transaction, and (B) any notes, obligations or other marketable
securities received by the Company or any Subject Subsidiary from
such transferee that are immediately converted by the Company or
such Subject Subsidiary into the form of consideration
constituting U.S. Dollars, shall both be deemed to be U.S.
Dollars for purposes of this provision; provided, further,
however, that the 90% limitation referred to above shall not
apply to (I) the sale by the Company of all of the Capital Stock
of BWCC, Inc. or the sale by BWCC, Inc. of substantially all of
the assets of the Central City Casino, or (II) any Restricted
Asset Sale in which the portion of the consideration received in
U.S. Dollars is equal to or greater than what the net after-tax
proceeds would have been had such Restricted Asset Sale complied
with the aforementioned 90% limitation; (iii) no Default or Event
of Default shall have occurred and be continuing at the time of
or after giving effect to such Restricted Asset Sale; and
(iv) unless otherwise expressly provided in the Indenture, the
Company shall apply the Net Cash Proceeds of such Restricted
Asset Sale in connection with the offer to purchase the Notes
described below; provided, however, that notwithstanding anything
contained herein to the contrary, other than as expressly
permitted by Section 1105, in no event shall the Company or any
Subject Subsidiary be permitted to, directly or indirectly,
engage in any Restricted Asset Sale involving any Collateral.
(b) On or before the 180th day after the date on which
the Company or any Subject Subsidiary consummates the relevant
Restricted Asset Sale, the Company shall make an offer to
purchase (the "Restricted Asset Sale Offer") from all holders of
Notes up to a maximum principal amount (expressed as a multiple
of $1,000) of Notes equal to the Net Cash Proceeds from such
Restricted Asset Sale at a purchase price equal to 101% of the
principal amount thereof plus accrued and unpaid interest
thereon, if any, to the date of purchase (the "Restricted Asset
Sale Purchase Price"); provided that the Company will not be
required to make a Restricted Asset Sale Offer if, and only to
the extent that, on or before the 165th day after the date on
which the Company or such Subject Subsidiary consummates the
relevant Restricted Asset Sale, the Company or any Subject
Subsidiary applies all of such portion thereof that is not
applied in connection with an Restricted Asset Sale Offer to make
a Permitted Related Investment and upon consummation thereof the
Trustee shall have or shall have received a senior, first
priority fully perfected Lien (subject only to the Permitted
Liens) in and upon the property or assets acquired by the Company
or any of its Subject Subsidiaries in connection therewith, and
the Company has delivered to the Trustee an Opinion of Counsel
with respect to the validity and perfection of such Lien. If the
Company is required to make a Restricted Asset Sale Offer
pursuant to this Section 917, on or prior to the 165th day
following the date on which the Company or any Company Subsidiary
consummates the relevant Restricted Asset Sale, the Company shall
deliver a written notice (a "Restricted Asset Sale Offer Notice")
via telefax or overnight delivery to the Trustee that the Company
is required to make a Restricted Asset Sale Offer that specifies
the Restricted Asset Sale Purchase Price that will be paid by the
Company in connection therewith. Each Restricted Asset Sale
Offer shall remain open for a period of at least 20 Business
Days. To the extent the Restricted Asset Sale Offer is not fully
subscribed to by the Holders of the Notes, the Company may retain
such unutilized portion of the Net Cash Proceeds. Holders whose
Notes are purchased only in part will be issued new Notes equal
in part in principal amount to the unpurchased portion of the
Notes surrendered.
The Company shall comply with applicable tender offer
rules, including Rule 14e-1 under the Exchange Act, in connection
with an Restricted Asset Sale Offer.
Section 918. Application of Net Cash Proceeds in Event
of Loss.
In the event that the Company or any Subject Subsidiary
suffers any Event of Loss that does not otherwise constitute a
Default or an Event of Default, on or before the 360th day after
the Company or such Subject Subsidiary receives any Net Cash
Proceeds from such Event of Loss, the Company shall make an offer
to purchase (the "Event of Loss Offer") from all holders of Notes
up to a maximum principal amount (expressed as a multiple of
$1,000) of Notes equal to the Net Cash Proceeds at a purchase
price equal to 101% of the principal amount thereof plus accrued
and unpaid interest thereon, if any, to the date of purchase (the
"Event of Loss Purchase Price"); provided that the Company will
not be required to make an Event of Loss Offer if, and only to
the extent that, on or before the 345th day after the date on
which the Company or such Subject Subsidiary receives any Net
Cash Proceeds from the relevant Event of Loss, the Company or any
Subject Subsidiary applies all or such portion thereof that is
not applied in connection with an Event of Loss Offer to make a
Permitted Related Investment and, upon consummation thereof, the
Trustee shall have or shall have received a senior, first
priority fully perfected Lien (subject only to Permitted Liens)
in and upon the property or assets acquired by the Company or any
of its Subject Subsidiaries in connection therewith, and the
Company has delivered to the Trustee an Opinion of Counsel as to
the validity and perfection of such Lien. If the Company is
required to make an Event of Loss Offer pursuant to this Section
918, on or prior to the 345th day following the date on which the
Company or any Company Subsidiary suffers the relevant Event of
Loss, the Company shall deliver a written notice (an "Event of
Loss Offer Notice") via telefax or overnight delivery to the
Trustee that the Company is required to make an Event of Loss
Offer that specifies the Event of Loss Purchase Price that will
be paid by the Company in connection therewith. Each Event of
Loss Offer shall remain open for a period of at least 20 Business
Days. To the extent the Event of Loss Offer is not fully
subscribed to by the holders of the Notes, the Company may retain
such unutilized portion of the Net Cash Proceeds. Holders whose
Notes are purchased only in part will be issued new Notes equal
in principal amount to the unpurchased portion of the Notes
surrendered. The Company shall comply with applicable tender
offer rules, including Rule 14e-1 under the Exchange act, in
connection with an Event of Loss Offer.
In the event any Event of Loss involves any Collateral,
the Company or the Company Subsidiary, as the case may be, shall
cause such Net Cash Proceeds to be deposited in the Collateral
Account on the Business Day on which such Net Cash Proceeds are
received by the Company or such Company Subsidiary. Collateral
Proceeds (including any earnings thereon) may be released from
the Collateral Account only in accordance with Section 1105.
Section 919. Ownership of Stock of Company
Subsidiaries.
(a) The Company shall at all times have, or cause a
wholly-owned Company Subsidiary (other than a Non-Operating
Subsidiary) to have, ownership of 100% of each class of Voting
Stock of, and all other equity securities in, each Company
Subsidiary (other than a Non-Operating Subsidiary), except
(i) any Subject Subsidiary that shall be disposed of in its
entirety in accordance with Section 917, and (ii) any Company
Subsidiary which becomes a Company Subsidiary by means of an
Investment by the Company or any Company Subsidiary expressly
permitted pursuant to Section 913.
Section 920. Limitation on Transactions with
Affiliates.
(a) Subject to subsection (b) below, the Company shall
not, and shall not permit any Company Subsidiary to, enter into,
renew or extend any transaction or series of related transactions
with any of their respective Affiliates (each an "Affiliate
Transaction"), unless (i) the Affiliate Transaction is on terms
at least as favorable to the Company or such Company Subsidiary,
as the case may be, as those that could have been obtained in a
comparable transaction on an arm's-length basis with an
unaffiliated third party; (ii) in the case of an Affiliate
Transaction (including any series of related transactions) with a
value to either party in excess of $500,000, a majority of the
Independent directors of the Board of Directors has determined in
good faith that such Affiliate Transaction complies with clause
(i), as evidenced by a Board Resolution; and (iii) in the case of
any Affiliate Transactions (including any series of related
transactions) with an aggregate value (to either party) in excess
of $1,000,000, the Company or such Company Subsidiary obtains a
written favorable opinion as to the fairness of such transaction
to the Company or such Company Subsidiary from a financial point
of view from any national or regional independent investment
banking firm with recognized experience in the gaming industry.
The Company, and any Company Subsidiary that is a Guarantor, may
only sell, transfer, convey, lease or assign any Collateral to
the Company or a Company Subsidiary if the Trustee has or
receives a senior, first priority fully perfected Lien (subject
only to the Permitted Liens) in and upon such Collateral upon
such sale, transfer, conveyance, lease or assignment and the
Company has delivered to the Trustee an Opinion of Counsel with
respect to the validity and perfection of such Lien.
(b) Subsection (a) shall not apply to any of the
following: (i) transactions between one or more Guarantors that
are wholly-owned Company Subsidiaries or between the Company and
one or more Guarantors that are wholly-owned Company
Subsidiaries, (ii) Restricted Payments permitted to be made under
Section 913 or (iii) customary directors' fees and indemnities.
Section 921. Change in Nature of Business.
The Company shall not, and shall not permit any of the
Company Subsidiaries to, directly or indirectly, own, acquire,
manage or conduct any operation, line of business or business or
other enterprise, other than a Permitted Line of Business.
Section 922. Additional Collateral.
The Company will, and will cause each of the Company
Subsidiaries that now owns or hereafter owns any assets or
property to, grant to the Trustee a valid and perfected senior,
first priority Lien (subject only to the Permitted Liens) in and
upon such assets or property enforceable against all third
parties and to execute and deliver all documents and to take all
action necessary or desirable to perfect and protect the
Noteholder Security Interest in favor of the Trustee, including,
without limitation, the following:
(i) executing and delivering to the Trustee (A) a
first priority mortgage and/or a deed of trust (subject only
to the Permitted Liens) which is (a) in the case of any
Colorado real property interests, in substantially the form
of the deeds of trust filed in respect of the fee or
leasehold interests in real property securing the Notes as
of the date of this Indenture, and (b) in the case of real
property interests in any other jurisdiction, in
substantially the form of the deed of trust referred to in
clause (a), appropriately modified to reflect the local law
of the jurisdiction in which such real property interest is
located, in any event with such modifications as are
acceptable to the Trustee and covering each real property
interest that is or becomes part of such assets (an
"Additional Deed of Trust"), together with (1) evidence that
counterparts of such Additional Deed of Trust have been duly
filed or recorded in all filing or recording offices
necessary or desirable in order to create a valid and
enforceable senior, first priority Lien (subject only to the
Permitted Liens) on such real property interest in favor of
the Trustee for its benefit and the benefit of the Holders,
and that all filing and recording taxes and fees have been
paid; (2) a fully paid American Land Title Association
Lender's Extended Coverage title insurance policy (or
written commitment to issue such policy) in an amount not
less than the fair market value, reasonably determined by
the Company, of such real property interest, insuring the
Additional Deed of Trust to be a valid and enforceable first
priority Lien (subject only to the Permitted Liens) on such
real property interest, free and clear of all defects and
encumbrances; (3) if necessary, copies of all
authorizations, consents and approvals of, evidence of other
actions by, and notices to and filings with, all
governmental authorities and regulatory bodies required for
the due execution, delivery or performance by the Company or
such Company Subsidiary of the Additional Deed of Trust
certified as to accuracy and completeness by a duly
authorized officer of the Company or such Company
Subsidiary; and (4) all necessary documentation or consents
required to perfect and maintain the validity, effectiveness
and enforceability of the Additional Deed of Trust,
including, without limitation, with respect to leasehold
interests acquired by the Company or such Company
Subsidiary, fully executed memoranda of lease, in recordable
form, and consents to assignment of the lease, provided that
where any such documentation or consents are required from a
third party, the Company or such Company Subsidiary will use
all reasonable efforts to obtain such documentation or
consent;
(ii) executing and delivering additional security
agreements or supplements to the Security Agreement (and the
schedules thereto) so as to create a senior, first priority
Lien (subject only to the Permitted Liens) on all personal
property that is or becomes part of such assets or property
(including the filing of Uniform Commercial Code financing
statements, endorsement and physical delivery, if
applicable, and the giving of notices and obtaining
appropriate consents), and otherwise complying with all of
the terms and conditions of the Security Agreement;
(iii) executing and delivering additional pledge
agreements or supplements to the Pledge Agreement (and the
schedules thereto) so as to create a senior, first priority
Lien (subject only to Permitted Liens) on all Capital Stock
that is or becomes part of such assets or property
(including the filing of Uniform Commercial Code financing
statements, endorsement and physical delivery thereof, if
applicable, and the giving of notice and obtaining
appropriate consents) and otherwise complying with all of
the terms and conditions of the Pledge Agreement; and
(iv) delivering to the Trustee within 30 days after
taking any of the foregoing actions a favorable Opinion of
Counsel as to the matters described in clause (i), (ii) or
(iii) being legal, valid and binding obligations of the
Person delivering the same and the Company has delivered to
the Trustee an Opinion of Counsel with respect to the
validity and perfection of the Noteholder Security Interest.
Section 923. Non-Operating Subsidiaries.
The Company shall not permit any of its Non-Operating
Subsidiaries to engage in, or conduct, any business whatsoever or
hold for use or own any assets or property (including, without
limitation, any equity securities), except for the assets or
property listed on Schedule 923. Without limiting the generality
of the foregoing, the Company shall not permit any Non-Operating
Subsidiary to (i) incur any Indebtedness or (ii) issue or sell
any Capital Stock, including, without limitation, any Common
Stock, Preferred Stock or Disqualified Stock of such Non-
Operating Subsidiary to any Person.
Section 924. Maintenance of Fixed Charge Coverage.
As of the end of each fiscal quarter commencing with
the fiscal quarter ending March 31, 1998, the Company shall not
permit the Consolidated Fixed Charges Coverage Ratio for the four
fiscal quarters ended as of such fiscal quarter to be less than
1.25 to 1.
Section 925. Noteholder Documents.
Simultaneously herewith, the Company shall execute, or
cause the Company Subsidiaries and Guarantors to execute, the
respective Noteholder Documents, as appropriate, securing the
Company's and the Guarantor's obligations under this Indenture
(including the Guarantee), the Noteholder Documents and the
Notes. Each Holder, by accepting a Note, agrees to all terms and
provisions of the Noteholder Documents as the same may be amended
or supplemented from time to time pursuant to the provisions
hereof and thereof. The terms of the release of the Collateral
and the rights of the Holders with respect thereto shall be
governed by the Noteholder Documents and this Indenture;
provided, however, that in the event of a conflict between the
terms of the Indenture and the terms of any other Noteholder
Documents, the terms of this Indenture shall govern.
Section 926. Validity of Noteholder Security Interest.
The Company represents and warrants that it has, and
covenants that it shall continue to have, full power and lawful
authority to grant, release, convey, assign, transfer, mortgage,
pledge, hypothecate and otherwise create the Noteholder Security
Interest referred to in Article Eleven, and the Company shall
warrant, preserve and defend the Noteholder Security Interest of
the Trustee in and to the Collateral or any asset or property
that should constitute Collateral but for the fact that the
Company and/or the Company Subsidiaries failed to comply with the
provisions of the Indenture or the Noteholder Documents against
the claims of all persons, and will maintain and preserve the
Noteholder Security Interest contemplated by Article Eleven. No
assets or property may be used at or in connection with a Gaming
Facility or any other property of the Company and/or the Company
Subsidiaries unless the Company and/or the Company Subsidiaries
have done all things necessary or desirable to create and perfect
a senior, first priority Lien (subject only to the Permitted
Liens) in such assets or property, and the Company has delivered
to the Trustee an Opinion of Counsel with respect to the validity
and perfection of such Lien.
Section 927. Investment Company Act.
Neither the Company nor any of the Company Subsidiaries
shall become an investment company subject to registration under
the Investment Company Act of 1940, as amended.
Section 928. Payment for Consent.
The Company shall not, and shall cause the Company
Subsidiaries not to, 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 of this Indenture or the other Noteholder Documents
unless such consideration is offered to be paid or agreed to be
paid to all Holders 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 929. Hemmeter Consulting Agreements.
The Company shall not, and shall not permit any Company
Subsidiary to, amend, modify or extend the term of any consulting
agreement entered into between the Company or any Company
Subsidiary and Christopher B. Hemmeter and the Company or any
Company Subsidiary and Mark M. Hemmeter as of the Issue Date, nor
thereafter enter into any additional agreements or arrangements
with either Christopher B. Hemmeter or Mark M. Hemmeter or any
Affiliate of either of them.
Section 930. Stay, Extension and Usury Laws.
Each of the Company, the Guarantors and the Company
Subsidiaries covenants (to the extent permissible under
applicable law) 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, wherever enacted, now or at any time hereafter in force,
that would prohibit or forgive the Company or the Guarantors from
paying all or any portion of the principal of, premium, if any,
or interest on the Notes and amounts from time to time payable
under the Guarantees, in each case as contemplated herein, or
that may materially affect the covenants or the performance of
this Indenture or the other Noteholder Documents in a manner
inconsistent with the provisions of this Indenture or such
Noteholder Documents and (to the extent that it may lawfully do
so) each of the Company and the Guarantors 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.
ARTICLE TEN
REDEMPTIONS AND REPURCHASES OF NOTES
Section 1001. Right of Redemption.
(a) The Notes may be redeemed, at the election of the
Company, as a whole or from time to time in part, by payment
thereof in accordance with Paragraph 5 of the Notes.
(b) All references in Article Ten to "Holder" shall
include any beneficial owner of Notes
Section 1002. Applicability of Article.
Redemption of Notes at the election of the Company or
otherwise, as permitted or required by any provision of this
Indenture, shall be made in accordance with such provision and
this Article.
Section 1003. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Notes
pursuant to Section 1001 shall be evidenced by a Board
Resolution. The Company shall, at least 45 and no more than 60
days prior to the Redemption Date fixed by the Company
(a) deliver an Officers' Certificate to the Trustee notifying the
Trustee of such Redemption Date and of the principal amount of
Notes to be redeemed and (b) provide the Trustee with an Opinion
of Counsel stating that such redemption is authorized or
permitted by this Indenture.
Section 1004. Selection by Trustee of Notes to Be
Redeemed or Repurchased.
Except as contemplated by Section 1009, if less than
all the Outstanding Notes are to be redeemed or repurchased, the
particular Notes or portions thereof to be redeemed or
repurchased shall be determined on a pro rata basis, by lot or by
such other method determined by the Trustee to be fair and
appropriate (subject to the requirements of any securities
exchange or trading system on which the Notes are then listed or
approved for trading) in principal amounts of $1,000 or integral
multiples thereof from the Outstanding Notes not previously
called for redemption or repurchase.
The Trustee shall promptly notify the Company and each
Note Registrar in writing of the Notes to be redeemed or
repurchased and, in the case of any Notes which will be redeemed
or repurchased in part, the principal amount thereof to be
redeemed or repurchased.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to redemption or
repurchase of Notes shall relate, in the case of any Note
redeemed or repurchased, or to be redeemed or repurchased only in
part, to the portion of the principal amount of such Note which
has been or is to be redeemed or repurchased.
Section 1005. Notice of Redemption.
Notice of redemption shall be given in the manner
provided for in Section 107 not less than 30 nor more than 60
days prior to the Redemption Date, to each Holder of Notes to be
redeemed at the address appearing in the Note Register. All
notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price, including the amount of
accrued and unpaid interest to the Redemption Date;
(3) if less than all Outstanding Notes are to be
redeemed, the identification (and in the case of a partial
redemption, the principal amounts) of the particular Notes
to be redeemed;
(4) that on the Redemption Date, the Redemption Price
(together with accrued interest, if any, to the Redemption
Date payable as provided in Section 1007) will become due
and payable upon each such Note, or the portion thereof, to
be redeemed, and that interest thereon will cease to accrue
on and after said date; and
(5) the place or places where such Notes are to be
surrendered for payment of the Redemption Price.
Notice of redemption of Notes to be redeemed at the
election of the Company shall be given by the Company or, at the
Company's request, by the Trustee in the name and at the expense
of the Company, provided that the text of any such notice shall
be determined by the Company.
Section 1006. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as
provided in Section 903) an amount of money in same day funds by
10:00 a.m. New York time on the Business Day immediately
preceding the Redemption Date sufficient to pay the Redemption
Price of, and (if the Redemption Date shall not be an Interest
Payment Date, but subject to 1009) accrued and unpaid interest
on, all the Notes or portions thereof which are to be redeemed on
the Redemption Date.
Section 1007. Notes Payable on Redemption Date.
Notice of redemption having been given as aforesaid,
the Notes so to be redeemed shall, on the Redemption Date, become
due and payable at the Redemption Price for such Notes and from
and after such date (unless the Company shall default in the
payment of the Redemption Price and, subject to Section 1009,
accrued interest to the Redemption Date) such Notes shall cease
to bear interest. Upon the later of the Redemption Date or
surrender of any such Note for redemption in accordance with said
notice, such Note shall be paid by the Company at the Redemption
Price, together with, subject to Section 1009, accrued and unpaid
interest to the Redemption Date; provided, however, that
installments of interest whose Stated Maturity is on or prior to
the Redemption Date shall be payable to the Holders of such Notes
or one or more Predecessor Notes, registered as such on the
relevant Record Dates according to their terms and the provisions
of Section 208.
If any Note called for redemption shall not be so paid
or duly provided for upon the later of the Redemption Date or
surrender thereof for redemption, the principal (and premium, if
any) shall, until paid, bear interest from the Redemption Date as
provided herein.
Section 1008. Notes Redeemed in Part.
Any Note which is to be redeemed only in part shall be
surrendered to the Paying Agent or Note Registrar (with, if the
Company, the Paying Agent, the Registrar or the Trustee so
requires, due endorsement by, or a written instrument of transfer
in form satisfactory to the Company, the Paying Agent, the
Registrar or the Trustee duly executed by, the Holder thereof or
such Holder's attorney duly authorized in writing), and the
Company and the Guarantors shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Note without
service charge, a new Note or Notes, of any authorized
denomination as requested by such Holder, in an aggregate
principal amount equal to, and in exchange for, the unredeemed
portion of the principal of the Note so surrendered.
Section 1009. Redemption Pursuant to Gaming Laws.
Each Holder, by accepting the Notes, shall be deemed to
have agreed (to the extent permitted by applicable law) that if
the Gaming Authority of any jurisdictions in which the Company or
any of the Company Subsidiaries conducts or proposes to conduct
gaming requires that a Person who is a Holder must be licensed or
found suitable under Gaming Laws, such Holder shall apply for a
license or a finding of suitability within the required time
period. If such Person fails to apply or become licensed or is
found unsuitable, the Company shall have the right, at its
option, (i) to require such Person to dispose of its Notes or
beneficial interest therein within 30 days of receipt of notice
of the Company's election or such earlier date as may be ordered
by such Gaming Authority or (ii) to redeem such Notes at a
Redemption Price equal to the lesser of (A) such Person's cost
and (B) 100% of the principal amount thereof, plus accrued and
unpaid interest to the earlier of the Redemption Date and the
date of the finding of unsuitability, which may be less than 30
days following the notice of redemption if so ordered by the
Gaming Authority. The Company shall notify the Trustee in
writing of any such redemption as soon as practicable. The
Company shall not be responsible for any costs or expenses any
such Holder may incur in connection with its application for a
license, qualification or a finding of suitability.
Section 1010. Effect of Notice of Redemption.
Once notice of redemption is mailed, Notes called for
redemption shall become due and payable on the Redemption Date at
the Redemption Price, together with, subject to Section 1009,
accrued and unpaid interest on such Notes through the Redemption
Date. Upon surrender to the Paying Agent, such Notes shall be
paid on the Redemption Date at the Redemption Price, together
with, subject to Section 1009, accrued and unpaid interest on
such Notes through the Redemption Date. If a Redemption Date is
a date other than a Business Day, payment shall be made on the
next succeeding Business Day and no interest shall accrue for the
period from such Redemption Date to such succeeding Business Day.
Section 1011. Offer to Purchase Notes upon Change of
Control.
(a) If a Change of Control (as defined below) shall
occur, subject to Section 1112 (including, without limitation the
rights of the holders of Bank Indebtedness under Section 1112),
the Company shall offer (a "Change of Control Purchase Offer") to
purchase from Holders of the Notes, and shall purchase from
Holders accepting such offer, Notes, at a purchase price equal to
101% of the aggregate principal amount of the Notes, plus accrued
and unpaid interest to the Purchase Date (the "Change of Control
Purchase Price"), subject to satisfaction by or on behalf of the
Holder of the requirements set forth in Section 1012(c). "Change
of Control" means (i) a sale, assignment, lease, transfer,
conveyance or other disposition, directly or indirectly, of all
or substantially all of the Company's assets or properties,
whether in a single transaction or a series of related
transactions (other than by way of merger or consolidation), to
any "person" or "group" (as such terms are used for purposes of
Sections 13(d) and 14(d) of the Exchange Act), (ii) the
liquidation or dissolution of the Company, (iii) the time that
the Company first determines or reasonably should have known that
any "person" or "group" (as such terms are used for purposes of
Section 13(d) and 14(d) of the Exchange Act, whether or not
applicable) is or becomes the "beneficial owner" (as such terms
is used in Rules 13d-3 and 13d-5 under the Exchange Act, whether
or not applicable, except that 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
(including as a result of a merger or consolidation), of more
than 50% of the total voting power in the aggregate of all
classes of Capital Stock then outstanding of the Company normally
entitled to vote in elections of directors, or (iv) 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 (determined after the resignation of
interim directors who are serving as directors only until all of
the individuals who are proposed by the Plan of Reorganization as
the initial directors (other than Thomas Thorsen) (the "Initial
Directors") of the Company are approved by the applicable Gaming
Authorities) together with any new directors whose election by
such board or whose nomination for election by the shareholders
of the Company was approved by a vote of a majority of the
directors then still in office who were directors at the
beginning of such period, cease for any reason to constitute a
majority of the Board of Directors of the Company then in office.
Notwithstanding anything contained herein to the contrary, (A)
any interim director of the Company who is still serving as a
director of the Company six months after the Issue Date shall be
deemed to be an Initial Director as of the Issue Date for
purposes of clause (iv) hereof and (B) the occurrence of a Black
Hawk Casino Event shall not give rise to a Change of Control.
(b) Within 15 Business Days after the occurrence of a
Change of Control, the Company shall given written notice of
Change of Control to the Trustee. Within 15 Business Days after
the Trustee receives such notice, the Trustee shall send, via
registered or certified mail, telefax, telex or overnight
delivery, a copy of such written notice to each Holder (and to
beneficial owners if required by applicable law as certified to
the Trustee in an Opinion of Counsel). The Trustee shall be
under no obligation to ascertain the occurrence of a Change of
Control or to give notice with respect thereto other than as
provided above upon receipt of the written notice of Change of
Control from the Company. The Trustee may conclusively assume,
in the absence of written notice to the contrary from the
Company, that no Change of Control has occurred.
Section 1012. Procedure for Offers to Purchase Notes.
(a) Within 5 days after delivery by the Company to the
Trustee of any Notice of Offer pursuant to Section 917 or 918,
the Trustee shall select, in the manner specified in
Section 1004, the Notes or portions thereof as to which the
Company will make the Restricted Asset Sale Offer or the Event of
Loss Offer, as applicable, relating to such Notice of Offer,
unless the Restricted Asset Sale Offer or the Event of Loss
Offer, as applicable, will be made as to all Outstanding Notes.
Within 15 days after delivery to the Trustee of such Notice of
Offer (or, if applicable, following such selection by the
Trustee, pursuant to the immediately preceding sentence, of the
Notes to be so purchased by the Company), the Company will, or
will cause the Trustee to, send to each Holder of Notes whose
Notes have been selected to be offered to be repurchased by the
Company, at its address appearing in the Note Register, by
registered or certified mail, telegraph, telefax, telex, cable or
overnight delivery, an offer to repurchase such Notes or a
portion thereof determined in accordance with Section 1004.
(b) Any notice to a Holder given pursuant to
Section 1012(a) or 1011(b) shall include a form of Purchase
Notice (as defined in subsection (c) below) and shall state:
(i) that the Company thereby offers to repurchase
at the applicable Purchase Price those Notes of such
Holder as shall be specified therein (or, in the case
of a Change of Control Purchase Price, all Notes of
such Holder);
(ii) in the case of a Change of Control Purchase
Offer, the events causing the Change of Control and the
date on which such Change of Control is deemed to have
occurred for purposes of this Section 1012;
(iii) the date by which the Purchase Notice
must be delivered to the Paying Agent;
(iv) the date as of which Notes will be purchased
pursuant to the Purchase Offer (the "Purchase Date"),
which shall be the date 20 Business Days (unless a
longer period is required by applicable law) after the
date on which the notice pursuant to Section 1011(b) or
Section 1012(a), as applicable, is given to the Holders
of the Notes;
(v) the name and address of the Paying Agent;
(vi) that Notes must be surrendered to the Paying
Agent at the office of the Paying Agent to collect
payment;
(vii) that the Purchase Price for any Notes as
to which a Purchase Notice has been duly given and not
withdrawn will be paid on the later of (A) the Purchase
Date and (B) the first Business Day following the date
of surrender of such Notes as described in clause (vi);
(viii) the procedures the Holder must follow to
exercise rights under Section 917, 918 or 1011, as
applicable, and this Section 1012 and a brief
description of those rights; and
(ix) the procedures for withdrawing a Purchase
Notice.
If any such notice is given by the Trustee at the
Company's request, the text of such notice shall be determined by
the Company.
(c) A Holder may exercise its rights under
Section 917, 918 or 1011, as applicable, and this Section 1012 by
delivering to the Paying Agent at the office of the Paying Agent
a written notice of purchase (a "Purchase Notice") at any time
prior to midnight on the Purchase Date, stating:
(i) the certificate numbers of the Notes that the
Holder will deliver to be purchased; and
(ii) the portion of the principal amount of the
Notes that the Holder will deliver to be purchased,
which portion must be $1,000 or an integral multiple
thereof.
The delivery of such Notes (together with all necessary
endorsements) to the Paying Agent at the office of the Paying
Agent prior to, on or after the Purchase Date shall be a
condition to the receipt by the Holder of the Purchase Price
therefor; provided that such Purchase Price shall be so paid
pursuant to this Section 1012 only if the Notes so delivered
shall conform in all respects to the description thereof set
forth in the related Purchase Notice.
Notwithstanding anything herein to the contrary, any
Holder delivering to the Paying Agent at the office of the Paying
Agent the Purchase Notice contemplated by this Section 1012(c)
shall have the right to withdraw such Purchase Notice in
accordance with Section 1013.
The Paying Agent shall promptly notify the Company by
telecopier of the receipt by the former of any Purchase Notice or
written notice of withdrawal thereof.
Section 1013. Effect of Purchase Notice.
Upon receipt by the Company or the Paying Agent of any
Purchase Notice, the Holder of the Note in respect of which such
Purchase Notice was given shall (unless such Purchase Notice is
withdrawn as specified in the following two paragraphs of this
Section 1013) thereafter be entitled to receive solely the
applicable Purchase Price with respect to such Note. Such
Purchase Price shall be paid to such Holder on the later of
(a) the applicable Purchase Date with respect to such Note
(provided the conditions in Section 1012(c) have been satisfied)
and (b) the first Business Day following the date of delivery of
such Note to the Paying Agent at the office of the Paying Agent
by the Holder thereof in the manner required by Section 1013.
A Purchase Notice may be withdrawn before or after
delivery by the Holder to the Paying Agent at the office of the
Paying Agent of the Note to which such Purchase Notice relates,
by means of a written notice of withdrawal delivered by the
Holder to the Paying Agent at the office of the Paying Agent at
any time prior to midnight on the Purchase Date, specifying, as
applicable:
(a) the certificate number and series of the Note in
respect of which such notice of withdrawal is being submitted,
(b) the principal amount of the Note with respect to
which such notice of withdrawal is being submitted, and
(c) the principal amount, if any, of such Note that
remains subject to the original Purchase Notice, and that has
been or will be delivered for purchase by the Company.
The Paying Agent will promptly return to the respective
Holders thereof any Notes with respect to which a Purchase Notice
has been withdrawn in compliance with this Indenture.
Section 1014. Deposit of Purchase Price.
No later than 10:00 a.m. (local time at the office of
the Paying Agent) on the Business Day immediately succeeding the
Purchase Date, the Company shall deposit with the Trustee or with
the Paying Agent (or, if the Company or a Company Subsidiary or
an Affiliate of either of them is acting as the Paying Agent,
shall segregate and hold in trust, or cause to be segregated and
held in trust, as provided in Section 903) an amount of cash
sufficient to pay the aggregate Purchase Price of all the Notes
or portions thereof that are to be purchased as of the Purchase
Date. Upon such deposit or segregation, all Notes or portions
thereof that are to be purchased shall cease to bear interest
after the Purchase Date.
Section 1015. Notes Purchased in Part.
Any Note that is to be purchased only in part shall be
surrendered to the Paying Agent at the office of the Paying Agent
or Note Registrar (with, if the Company, the Paying Agent, the
Note Registrar or the Trustee so requires, due endorsement by, or
a written instrument of transfer in form satisfactory to the
Company, the Paying Agent, the Note Registrar and the Trustee
duly executed by, the Holder thereof or such Holder's attorney
duly authorized in writing) and the Company shall execute and the
Trustee shall authenticate and deliver to the Holder of such
Note, without service charge, a new Note or Notes, of any
authorized denomination as requested by such Holder in an
aggregate principal amount equal to, and in exchange for, the
portion of the principal amount of the Note so surrendered that
is not purchased.
Section 1016. Covenant to Comply With Securities Laws
Upon Purchase of Notes.
In connection with any offer to purchase or purchase of
Notes under Section 917, 918, 1011 or 1012, notwithstanding
anything herein to the contrary, the Company shall comply with
all applicable federal and state securities laws so as to permit
the rights and obligations under Section 917, 918, 1011 or 1012
to be exercised to the greatest extent practicable in the time
and in the manner specified in such Sections.
Section 1017. Repayment to the Company.
The Trustee and the Paying Agent shall return to the
Company upon written order any cash that remains unclaimed,
together with interest, if any, accrued thereon, held by them for
the payment of the Purchase Price two years after the related
Purchase Date.
ARTICLE ELEVEN
NOTEHOLDER SECURITY INTEREST
Section 1101. Noteholder Security Interest Generally.
(a) In order to secure the performance of the
Company's obligation to pay the principal amount of, premium, if
any, and interest on the Notes when and as the same shall be due
and payable, whether at maturity or on an Interest Payment Date,
by acceleration, call for redemption or otherwise, and interest
on the overdue principal of and interest on, if any, the Notes
and performance of all other obligations of the Company to the
Holders and the Trustee under this Indenture and the Notes,
according to the terms hereunder or thereunder, and to secure the
obligations of the Guarantors under the Guarantee, the Company
and the Guarantors pursuant to the Noteholder Documents have
unconditionally and absolutely granted and conveyed to the
Trustee for the benefit of itself and all Holders the Noteholder
Security Interest which shall constitute a senior, first priority
Lien in and upon the Collateral and all other assets and property
of the Company and the Company Subsidiaries securing the
Noteholder Indebtedness, subject only to the Permitted Liens.
(b) The Noteholder Security Interest as now or
hereafter in effect shall be held for the Trustee and for the
equal and ratable benefit and security of the Notes without
preference, priority or distinction of any thereof over any other
by reason, or difference in time, of issuance, sale or otherwise,
and, without limiting the generality of subsection (a) of this
Section 1101, for the enforcement of the payment of principal of,
premium, if any, and interest on the Notes in accordance with
their terms.
(c) The Company and the Guarantors have executed and
delivered, filed and recorded and/or will execute and deliver,
file and record, all instruments and documents, and have done or
will do or cause to be done all such acts and other things as are
necessary to subject the Collateral to the Lien of the Noteholder
Documents. The Company and the Guarantors will execute and
deliver, file and record all instruments and do all acts and
other things as may be reasonably necessary or advisable to
perfect, maintain and protect the Noteholder Security Interest
and shall pay all filing, recording, mortgage or other taxes or
fees incidental thereto.
(d) The Company shall establish the Collateral Account
with the Trustee on or prior to the Issue Date.
Section 1102. Evidence of Perfection of Liens.
The Company and the Guarantors shall furnish to the
Trustee:
(a) On the Issue Date, an Opinion of Counsel stating
that, in the opinion of such counsel, all recordings, filings and
other actions contemplated by such Noteholder Documents necessary
to make effective or perfect the Noteholder Security Interest
have been taken, reciting such actions;
(b) On or prior to each anniversary of the date
hereof, an Opinion of Counsel, dated as of such date, either (i)
stating that, in the opinion of such counsel, such action has
been taken with respect to the recording, registering, filing,
re-recording, re-registering and re-filing of the Noteholder
Documents, or financing statements, continuation statements or
other instruments of further assurance, as is necessary to
maintain the Liens of the Noteholder Documents to the extent
required hereby, until the next such anniversary, and reciting
the details of such action, or (ii) stating that, in the opinion
of such counsel no such action is necessary to maintain such
Liens.
Section 1103. Suits to Protect the Collateral.
To the extent permitted under the Noteholder Documents
and this Indenture, the Trustee shall have power to institute and
maintain such suits and proceedings as it may deem expedient to
prevent any impairment of the Collateral by any acts which may be
unlawful or in violation of this Indenture or the Noteholder
Documents and such suits and proceedings as the Trustee may deem
expedient to preserve or protect its interests and the interest
of the Holders in the Collateral and in the profits, rents,
revenues and other income arising therefrom (including power to
institute and maintain suits or proceedings to restrain the
enforcement of or compliance with any legislative or other
governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the
Noteholder Security Interest thereunder or be prejudicial to the
interest of the Holders or of the Trustee).
Section 1104. Further Assurances and Security.
The Company and the Guarantors represent and warrant
that at the time the Noteholder Documents and this Indenture are
executed, the Company and/or the Guarantors (i) will have full
right, power and lawful authority to grant, bargain, sell,
release, convey, hypothecate, assign, mortgage, pledge, transfer
and confirm, absolutely, the Collateral, in the manner and form
done, or intended to be done, in the Noteholder Documents, free
and clear of all Liens, except for the Permitted Liens,and will
forever warrant and defend the title to the same against the
claims of all Persons whatsoever; (ii) will execute, acknowledge
and deliver to the Trustee, at the Company's and the Guarantor's
expense, at any time and from time to time such further
assignments, transfer, assurances or other instruments as may be
required to effectuate the terms of this Indenture or the
Noteholder Documents; and (iii) will at any time and from time to
time do or cause to be done all such acts and things as may be
necessary or proper, or as may be required by the Trustee (which
shall have no duty to so require), to assure and confirm to the
Trustee the Noteholder Security Interest contemplated hereby and
by the Noteholder Documents.
Section 1105. Release of Collateral.
(a) The Company or any Company Subsidiary (including
any Guarantor) shall have the right, in connection with any
Unrestricted Asset Sale involving Collateral, to release from the
Noteholder Security Interest any Collateral sold, conveyed,
assigned, transferred, leased or otherwise disposed of as part of
such Unrestricted Asset Sale, provided that immediately before
and after giving effect to such release and proposed Unrestricted
Asset Sale, no Default or Event of Default has occurred and is
continuing and upon compliance by the Company of each of the
following:
(1) Receipt by the Trustee of a Company Request
at least ten (10) Business Days in advance of the
requested date for the delivery of the release
instruments, requesting that the Trustee execute one or
more specifically described release instruments; and
(2) Receipt by the Trustee on or before the date
scheduled for such release of an Officer's Certificate
certifying that the conditions of this Section 1105(a)
with respect to such release have been fulfilled and
setting forth a description of each item of Collateral
to be released, the Fair Market Value of any such item
of Collateral, the total consideration, if any, that
the Company, any Company Subsidiary, or any Guarantor
will receive in connection with the Unrestricted Asset
Sale and, that in the opinion of the signors, the
security interest in favor of the Trustee in the
remaining Collateral would not be impaired by such
release.
(b) The Company or any Company Subsidiary or any
Guarantor shall have the right, in connection with any Restricted
Asset Sale involving Collateral that is otherwise expressly
permitted in accordance with the terms and conditions set forth
in Section 917, to release from the Noteholder Security Interest
any Collateral, provided that immediately before and after giving
effect to such release and the proposed Restricted Asset Sale:
(x) the Consolidated Coverage Ratio immediately after giving
effect to such release (assuming that the Net Cash Proceeds to be
received are applied immediately after the Restricted Asset Sale
first, to reduce the principal amount of any outstanding Bank
Indebtedness to the extent required by the terms thereof, and
thereafter to the extent of any remaining Net Cash Proceeds, to
reduce the principal amount of Notes Outstanding) would be no
less than the Consolidated Coverage Ratio immediately prior to
such release, (y) no Default or Event of Default has occurred and
is continuing, and (z) upon compliance by the Company with each
of the following:
(1) Receipt by the Trustee of a Company Request
at least ten (10) Business Days in advance of the
requested date for the delivery of the release
instruments, requesting the Trustee to execute one or
more specifically described release instruments;
(2) Receipt by the Trustee on or before the date
scheduled for such release (the "Collateral Release
Date") of an Officers' Certificate certifying that the
conditions of this Section 1105 set forth below have
been fulfilled. Such Officers' Certificate shall also
set forth:
(A) a description of each item of Collateral
to be released, the Fair Market Value of each such
item of Collateral, the total consideration that
the Company, any Company Subsidiary or any
Guarantor will receive in connection with the
Restricted Asset Sale and the amount of cash
and/or Cash Equivalents that the Company, any
Company Subsidiary or any Guarantor shall receive
in connection with such Restricted Asset Sale;
(B) that, in the opinion of the signers, (x)
the Noteholder Security Interest in the remaining
Collateral will not be impaired by such release,
and (y) the Collateral to be released is not
necessary for the efficient operation of the Black
Hawk Casino or for the conduct of the business of
the Company and the Company Subsidiaries (taken as
a whole) as conducted immediately prior thereto;
and
(C) that (x) the Consolidated Coverage Ratio
immediately after giving effect to such release
(assuming that the Net Cash Proceeds to be
received are applied immediately after the
Restricted Asset Sale first, to reduce the
principal amount of any outstanding Bank
Indebtedness to the extent required by the terms
thereof, and thereafter to the extent of any
remaining Net Cash Proceeds, to reduce the
principal amount of Notes Outstanding) would be no
less than the Consolidated Coverage Ratio
immediately prior to such release; (y) no Default
or Event of Default has occurred and is
continuing; and (z) all conditions precedent in
the Indenture and the Noteholder Documents
relating to the release of such Collateral have
been complied with; and
(D) (i) whether the aggregate amount of the
fair value of the property to be released at the
date of the Company Request and the fair value of
all securities or other property released since
the commencement of the then current calendar year
(as previously certified to the Trustee in
connection with releases) is 5% or more of the
aggregate principal amount of the Notes at the
time Outstanding and (ii) whether said fair value
of the property to be released is at least $25,000
and at least 1% of the aggregate principal amount
of the Notes at the time Outstanding; and
(E) if the criteria in (D) are met, that a
certificate or opinion of an Independent Person
selected and approved as required by TIA
Section 314(d) is being furnished pursuant to
paragraph (3) of this Section 1105; and
(F) the Bank Indebtedness Amount immediately
after giving effect to the Restricted Asset Sale.
(3) The Company shall deliver to the Trustee any
certificate or opinion of an engineer, appraiser or
other expert required by TIA Section 314(d) as to the
Fair Market Value of the Collateral to be released,
dated or updated as of the date not more than 90 days
prior to the date of release; such certificate or
opinion shall state that the proposed release of
Collateral will not impair the Noteholder Security
Interest in contravention of the terms hereof. Any
certificate or opinion required by TIA Section 314(d)
may be made by an officer of the Company, except in
cases as to which TIA Section 314(d) required that such
certificate or opinion be made by an Independent
Person, in which case, such certificate or opinion
shall be made by an Independent Person selected and
approved as required by TIA Section 314(d).
(4) The Company shall deliver to the Trustee an
Opinion of Counsel stating that the certificate,
opinions, other instruments or cash which have been or
are therewith delivered to and deposited with the
Trustee conform to the requirements of this Indenture
and the other Noteholder Documents, that the property
to be released pursuant to a Company Request may be
lawfully released from the Noteholder Security Interest
and that all conditions precedent in this Indenture and
the Noteholder Documents relating to such release have
been complied with.
(c) The Company shall deposit, and shall cause each
Company Subsidiary to deposit, all Net Cash Proceeds of any
Restricted Asset Sale pursuant to Section 917 that involves
Collateral or any Event of Loss that involves Collateral in the
Collateral Account on the Business Day on which such Net Cash
Proceeds are received by the Company or such Company Subsidiary.
Upon receipt by the Trustee of a Company Request, Collateral
Proceeds (including any earnings thereon) may be released from
the Collateral Account in order to, and in only such amount as is
required to, (i) pay the principal amount of Notes tendered
pursuant to a Restricted Asset Sale Offer or Event of Loss Offer
or (ii) make a Permitted Related Investment; provided that upon
consummation of such Permitted Related Investment, the Trustee
shall have received a senior, first priority Lien (subject only
to the Permitted Liens) in the property or assets acquired by the
Company or any Company Subsidiary in connection therewith,
provided that prior to such release of Collateral Proceeds from
the Collateral Account the Company delivers to the Trustee each
of the following:
(1) an Officer's Certificate, dated the date on which
Collateral Proceeds shall be released from the Collateral
Account (the "Collateral Proceeds Release Date"), stating
in substance as to certain matters (which statements shall,
on the Collateral Proceeds Release Date, be true and
correct), including the following:
(A) the reason that the Company is requesting a
release of the Collateral Proceeds and a description of
the use to be made of the Collateral Proceeds to be
released;
(B) in the case of clause (i) above, the
aggregate principal amount of Notes purchased on the
Collateral Proceeds Release Date and, in the case of
clause (ii) above, a description of the property or
assets being acquired and the Fair Market Value and the
purchase price of each such property or asset to be
acquired by the Company and/or the Company Subsidiaries
(if more than one);
(C) that the amount to be released from the
Collateral Account does not exceed the aggregate
principal amount of Notes to be purchased on the
Collateral Proceeds Release Date or the purchase price
of the property or assets to acquired by the Company or
any of the Company Subsidiaries, as the case may be;
(D) that, in the case of clause (ii) above, the
Company and/or the Company Subsidiaries, as the case
may be, have taken all steps necessary or desirable so
that upon consummation of such Permitted Related
Investment, the Trustee shall receive a senior, first
priority Lien in and upon such property or assets
(subject only to Permitted Liens);
(E) that no Default or Event of Default has
occurred and is continuing at the time of, or after
giving effect to, such release of Collateral Proceeds;
and
(F) that all conditions precedent in the
Indenture and the Noteholder Documents relating to the
release of the Collateral Proceeds have been complied
with; and
(2) an Opinion of Counsel stating that the
certificate, opinions, other instruments or cash which have
been or are therewith delivered to and deposited with the
Trustee conform to the requirements of this Indenture and
the other Noteholder Documents, that the Collateral Proceeds
to be released pursuant to such Company Request referred to
above may be lawfully released from the Noteholder Security
Interest and that all conditions precedent in this Indenture
and the other Noteholder Documents relating to such release
(including, without limitation, the requirement that in the
case of clause (ii) above the Trustee receive a senior,
first priority Lien in and upon the property or assets
acquired, subject only to Permitted Liens), have been
complied with.
Section 1106. Reliance on Opinion of Counsel.
The Trustee shall, before taking any action under this
Article Eleven, be entitled to receive an Opinion of Counsel,
stating the legal effect of such action, the steps necessary to
consummate the same and to perfect the Trustee's priority with
respect to any Lien in connection therewith and that such action
will not be in contravention of the provisions of this Indenture
or the other Noteholder Documents and such opinion shall be full
protection to the Trustee for any action taken or omitted to be
taken in reliance thereon.
Section 1107. Purchaser May Rely.
A purchaser in good faith of the Collateral or any part
thereof or interest therein which is purported to be transferred,
granted or released by the Trustee as provided in this Article
Eleven shall not be bound to ascertain, and may rely on the
authority of the Trustee to execute, transfer, grant or release,
or to inquire as to the satisfaction of any conditions precedent
to the exercise of such authority, or to see to the application
of the purchase price therefor.
Section 1108. Payment of Expenses.
On demand of the Trustee, the Company forthwith shall
pay or satisfactorily provide for the payment of all reasonable
expenditures incurred by the Trustee under this Article Eleven,
including, without limitation, the costs of title insurance,
surveys, attorneys' fees and expenses, recording fees and taxes,
transfer taxes, taxes on indebtedness and other expenses
incidental thereto and all such sums shall be a Lien (subject to
Permitted Liens) upon the Collateral prior to the Notes and shall
be secured thereby.
Section 1109. Release and Substitution of Collateral-
Trust Indenture Act Compliance.
At all times after qualification of this Indenture
under the Trust Indenture Act:
(a) To the extent applicable, the Company and each
Guarantor shall comply with Section 314 of the Trust Indenture
Act relating to the release of property or securities from the
Noteholder Security Interest.
(b) The release of any Collateral from the Noteholder
Security Interest or the subordination of the Noteholder Security
Interest shall not be deemed to impair the Noteholder Security
Interest or the Collateral under the Noteholder Documents in
contravention of the provisions of this Indenture or such
Noteholder Document if and to the extent the Collateral or the
Noteholder Security Interest is released or subordinated pursuant
to, and in accordance with, this Indenture and such Noteholder
Documents.
Section 1110. Release Upon Termination of the
Company's Obligations.
(a) If (i) the Company delivers an Officers'
Certificate certifying that all of its obligations under this
Indenture have been indefeasibly satisfied and discharged by
complying with the provisions of Article Three or Twelve hereof
or (ii) all Outstanding Notes issued under this Indenture shall
have been surrendered to the Trustee for cancellation, the
Trustee, subject to compliance by the Company with Section 1109,
shall deliver to the Company and the Guarantors a certificate
stating that the Trustee, on behalf of the Holders, disclaim and
have given up any and all rights they have in or to the
Collateral, and any rights they have under the Noteholder
Documents, and, upon and after the receipt by the Company and the
Guarantors of such certificate, the Trustee shall no longer be
deemed to hold the Noteholder Security Interest for the benefit
of the Holders.
(b) Any release of Collateral made in compliance with
this Section 1110 shall not be deemed to impair the Noteholder
Security Interest or the Collateral under the Noteholder
Documents in contravention of the provisions of this Indenture or
the Noteholder Documents.
(c) Nothing in this Section 1110 shall impair the
first priority Lien and trust created pursuant to Article Three
or Twelve in any funds or securities deposited with the Trustee
pursuant to such Articles.
Section 1111. Trustee Duties with Respect to
Collateral.
(a) The Trustee shall:
(i) to the extent contemplated by the relevant
Noteholder Documents and this Indenture, execute and deliver all
Noteholder Documents required to be executed by the Trustee and
hold in its possession all Collateral Proceeds from time to time
delivered to it; and
(ii) take all steps the Trustee is entitled to
take under the relevant Noteholder Documents for the protection
of the Collateral or the Liens of the Holders therein or its
priority (including by discharging or paying Liens and claims the
Trustee is entitled to discharge or pay), provided the Trustee
has received notice of facts indicating that such steps are
required for the protection of the Collateral or such Lien or its
priority, whether in the Opinion of Counsel required by Section
1102, pursuant to any requirement of the Noteholder Documents to
give such notice, or otherwise.
(b) The Trustee shall have only such duties with
respect to the Collateral as are set forth in this Indenture and
the Noteholder Documents.
(c) In the performance of its duties hereunder and the
Noteholder Documents, the Trustee shall be fully protected and
indemnified to the full extent of the indemnity provided in
Section 503 and Section 507.
Section 1112. Priority of Liens.
Notwithstanding anything to the contrary contained in
Noteholder Documents, the Company, each Company Subsidiary and
the Trustee agree, and each Holder by accepting a Note agrees,
that:
(a) Relative Lien Priorities. As between the holders
of Bank Indebtedness, on the one hand, and the Trustee and the
Holders of the Notes, on the other hand, and notwithstanding the
terms (including the description of the Collateral), time, order
or method of granting or perfection of any security interest or
Lien, the time or order of filing or recording of any financing
statements, assignments, deeds of trust, mortgages, or any other
documents, instruments, or agreements under the Uniform
Commercial Code or any other applicable law: the Bank Security
Interest is and shall be a senior, first priority Lien in and
upon the Collateral and any and all other assets and property of
the Company and the Company Subsidiaries as may now or hereafter
constitute Collateral, and the Noteholder Security Interest is
and shall be a junior, second priority Lien in and upon the
Collateral and any and all assets or property of the Company and
the Company Subsidiaries as may now or hereafter constitute
Collateral, except that so long as Millsite 20 Limited Liability
Company LLC, a Colorado limited liability company, holds a first
deed of trust on the Silver Hawk Property, the Bank Security
Interest is and shall be a second priority Lien in and upon the
Silver Hawk Property, and the Noteholder Security Interest is and
shall be a third priority Lien in and upon the Silver Hawk
Property. The Lien priorities provided herein shall not be
altered or otherwise affected by any amendment, modification,
supplement, extension, renewal, restatement, replacement or
refinancing of any Bank Indebtedness or any Noteholder
Indebtedness, nor by any action or inaction which the holders of
Bank Indebtedness, the Trustee or the Holders of the Notes may
take or fail to take in respect of any of the Collateral. The
Trustee and the Holders of the Notes hereby acknowledge that this
Section 1112 shall constitute notice of the interests in the
Collateral of the holders of Bank Indebtedness as provided by
Section 9-504 of the Uniform Commercial Code. The Trustee and
the Holders of the Notes waive any right to compel the holders of
Bank Indebtedness to marshal assets or property of the Company or
the Company Subsidiaries or to seek payment from any particular
assets of the Company or the Company Subsidiaries or from any
other Person. The Company and the Guarantors hereby agree that
no action taken by any holder of Bank Indebtedness shall impair,
preclude or restrict in any way (and the Company and each
Guarantor hereby waives any right to assert that any such action
impairs, precludes or restricts in any way) the right of any
Holder of the Notes or the Trustee under the Noteholder
Documents, including the right to exercise any remedy under any
Noteholder Document or to seek, or assert a right to, payment of
the Noteholder Indebtedness or any portion thereof. Without
limiting the generality of the foregoing, the provisions of this
Section 1112 are and are intended solely for the purpose of
defining the relative lien priorities of the Bank Security
Interest and the Noteholder Security Interest. Nothing contained
in this Section 1112 or elsewhere in this Indenture or any other
Noteholder Documents or in the Notes is intended to or shall (a)
impair, as among the Company and/or the Company Subsidiaries,
their respective secured creditors and other creditors, and the
Holders of the Notes, the obligation of the Company and the
Guarantors, which is absolute and unconditional (and which is
intended to rank equally with all other Indebtedness of the
Company and the Guarantors (including, without limitation, Bank
Indebtedness)) to pay to the Holders of the Notes the principal
of (and premium, if any) and interest on the Notes as and when
the same shall become due and payable in accordance with their
terms (including, without limitation, demanding payment on the
Notes or the Guarantee and taking any action to accelerate the
maturity of the Notes in accordance with the terms of this
Indenture); or (b) affect the relative rights as among the
Company and/or the Company Subsidiaries, their respective secured
creditors and other creditors (other than the holders of Bank
Indebtedness) and the Holder of the Notes, regarding the relative
priority of the Noteholder Security Interest as a senior Lien in
and upon the Collateral to all other Liens in and upon the
Collateral such that, except for the Bank Security Interest and
other Permitted Liens, the Noteholder Security Interest shall be
a senior, first priority Lien in and upon the Collateral and any
and all other assets and property of the Company and the Company
Subsidiaries as may now or hereafter constitute Collateral; or
(c) subject to the rights of the holders of Bank Indebtedness
under this Section 1112, prevent the Trustee or any Holder of
Notes from exercising any remedy with respect to, or asserting
any right against, the Collateral, the Company or any Guarantor
permitted under the Noteholder Documents or under applicable law
upon a Default or Event of Default or from receiving cash,
property or securities otherwise payable or deliverable to the
Trustee or the Holders of the Notes.
(b) Management and Sale of Collateral. From and after
a Senior Event of Default and through the end of any Collateral
Control Period:
(i) The holders of Bank Indebtedness shall have the
sole and exclusive right to manage, perform and enforce all
rights and remedies with respect to the Collateral and to
exercise and enforce all privileges and rights under the Bank
Documents according to their discretion and the exercise of their
business judgment, including, without limitation, the exclusive
right to approve the enforcement or settlement of any insurance
claims, take or retake control or possession of any of the
Collateral, notify account debtors, collect accounts receivable,
and hold, prepare for sale, process, sell, lease, dispose of, or
liquidate any of the Collateral. Until all obligations with
respect to the Bank Indebtedness have been discharged in full,
any and all proceeds of the Collateral which shall come into the
possession, control, or custody of the Trustee or the Holders of
Notes shall be held in trust by the Trustee and the Holders of
the Notes and immediately paid over to the holders of Bank
Indebtedness. Nothing contained herein or in any Noteholder
Document or any Bank Document shall be deemed to in any way
impair, restrict or otherwise adversely affect the right of the
Trustee or the Holders of Notes to bring, or join with any
creditor in bringing, any proceeding against the Company or any
Company Subsidiary under any bankruptcy, reorganization,
readjustment or arrangement of debt, suspension of payments,
receivership, liquidation or insolvency or similar law or statute
now or hereafter in effect ("Insolvency Proceeding"), to vote on
any plan of reorganization, arrangement, adjustment or
composition involving any obligor of the Notes or to file proofs
of claim as secured creditors in respect of the Noteholder
Security Interest or the Noteholder Indebtedness or assert any
right to adequate protection in any Insolvency Proceeding
involving the Company or the Company Subsidiaries.
(ii) The Trustee and the Holders of the Notes shall not
enforce or attempt to enforce any rights or remedies with respect
to the Collateral or exercise or enforce any privileges or rights
under the Noteholder Documents with respect to the Collateral
including, without limitation, enforcing or settling insurance
claims, taking or retaking control or possession of any of the
Collateral, notifying account debtors, or collecting accounts
receivable or selling, leasing, disposing of, or liquidating any
of the Collateral.
(iii) The Trustee and the Holders of the Notes
will, immediately upon the request of the holders of a majority
of the outstanding Bank Indebtedness, release or otherwise
terminate their Noteholder Security Interest in any portion of
the Collateral but only to the extent such portion of the
Collateral is sold, or otherwise disposed of by the Company or
any Company Subsidiary with the consent of the holders of Bank
Indebtedness to any Person that is not a holder of Bank
Indebtedness or an Affiliate of any holder of Bank Indebtedness,
and the Trustee and the Holders of the Notes will immediately
deliver such release documents as the holders of Bank
Indebtedness may require in connection therewith; provided,
however, that notwithstanding anything contained herein or in any
other Noteholder Document to the contrary, neither the Trustee
nor any Holder of Notes shall have any obligation to release or
otherwise terminate the Noteholder Security Interest in any
portion of the Collateral unless simultaneously therewith, the
holders of the Bank Indebtedness shall have released or otherwise
terminated the Bank Security Interest in such portion of the
Collateral. The holders of Bank Indebtedness are hereby granted
an irrevocable power of attorney, coupled with an interest,
exercisable in the event the Trustee or the Holders of the Notes
fail to comply with the foregoing covenant, to execute in the
name of the Trustee and the Holders of the Notes any such release
documents.
(c) Modification of Documents. The holders of Bank
Indebtedness may grant extensions of the time of payment or
performance for Bank Indebtedness and make compromises and
settlements with the Company and/or the Company Subsidiaries and
all other persons with respect to Bank Indebtedness, release all
or any portion of the Collateral from the Bank Security Interest,
or otherwise amend any of the Bank Documents or waive any of the
provisions thereof, all without the consent of the Trustee or the
Holders of the Notes and without affecting the agreements of the
Trustee and the Holders of the Notes or the Company and the
Company Subsidiaries set forth in this Section 1112. If the
holders of Bank Indebtedness shall, for any reason, determine to
discontinue the extension of credit to the Company and/or the
Company Subsidiaries, the holders of Bank Indebtedness may do so.
The Company, the Company Subsidiaries, the Trustee and the
Holders of the Notes shall not amend or modify the Noteholder
Documents in any respect which would adversely affect the rights
of the holders of Bank Indebtedness under this Section 1112.
(d) No Impairment. No right of any holder of Bank
Indebtedness to enforce the subordination of the Noteholder
Security Interest shall be impaired by any act or failure to act
by the Company, any Company Subsidiary, the Trustee or any Holder
of Notes or by failure of the Company, any Company Subsidiary,
the Trustee or any Holder of Notes to comply with this Indenture
or the Noteholder Documents.
(e) Notice of Event of Default Under Indenture. The
Company shall promptly notify the holders of Bank Indebtedness of
the occurrence of any Event of Default.
(f) Cure of Event of Default. The holders of Bank
Indebtedness shall have the option exercisable in their sole
discretion to cure any Event of Default on behalf of Company and
the Company Subsidiaries.
(g) Injunctive Relief. If the Trustee or any Holders
of the Notes shall take or attempt to take any action in
violation of this Section 1112: (i) the Company and the Company
Subsidiaries may interpose as a defense or dilatory plea the
making of this Section 1112 and the holders of the Bank
Indebtedness may intervene and interpose such defense or plea in
the name of the holders of Bank Indebtedness or in the name of
the Company and the Company Subsidiaries, and (ii) the holders of
Bank Indebtedness, the Company or the Company Subsidiaries may
restrain the enforcement thereof in the name of holders of Bank
Indebtedness or in the name of the Company and the Company
Subsidiaries.
(h) Continuing Offer. The provisions of this Section
1112 shall constitute a continuing offer to all Persons who, in
reliance upon such provisions, become holders of, or continue to
hold, Bank Indebtedness, and such provisions are made for the
benefit of the holders of Bank Indebtedness, and such holders are
made obligees hereunder and they or each of them may enforce such
provisions.
(i) Ability to Retire Bank Indebtedness. The Holders
of Notes shall have the option exercisable in their sole
discretion, at any time following a Senior Event of Default, to
advance any and all amounts to the Company to satisfy the then
outstanding Bank Indebtedness in full. All sums so advanced and
all expenses incurred by the holders of the Notes in connection
with such advances or actions shall be deemed to be additional
Noteholder Indebtedness and shall bear interest from the date any
sums are advanced or expenses are incurred by the Holders of
Notes at a rate equal 12% per annum.
ARTICLE TWELVE
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 1201. Option to Effect Legal Defeasance or
Covenant Defeasance.
The Company may, at its option by Board Resolution, at
any time, with respect to the Notes, elect to have the provisions
set forth in either Section 1202 or Section 1203 applied to all
Outstanding Notes upon compliance with the conditions set forth
below in this Article Twelve.
Section 1202. Legal Defeasance and Discharge.
Upon the Company's exercise under Section 1201 of the
option applicable to this Section 1202, the Company and the
Guarantors shall be deemed to have been discharged from their
obligations with respect to all Outstanding Notes on the date the
conditions set forth in Section 1204 are satisfied (hereinafter,
"Legal Defeasance"). For these purposes, such Legal Defeasance
means that the Company and each Guarantor shall be deemed to have
paid and discharged the entire Indebtedness represented by the
Outstanding Notes and this Indenture shall cease to be of further
effect as to all Outstanding Notes (except as to the rights of
Holders to receive payment which shall thereafter be deemed to be
"Outstanding" only for the purposes of Section 1205 and the other
Sections of this Indenture referred to in (a) and (b) below), and
to have satisfied all its other obligations under such Notes,
this Indenture and the Guarantee insofar as such Notes are
concerned (and the Trustee, on demand of and at the expense of
the Company, shall execute proper instruments acknowledging the
same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (a) the rights of
Holders of Outstanding Notes to receive, solely from the trust
fund described in Section 1204 and as more fully set forth in
such Section, payments in respect of the principal of (and
premium, if any, on) and interest on such Notes when such
payments are due, (b) the Company's and the Guarantor's
obligations with respect to such Notes under Sections 205, 206,
702 and 903 and Article Thirteen, (c) the rights, powers, trusts,
duties, indemnities and immunities of the Trustee hereunder and
the Company's and the Guarantors' obligations in connection
therewith and (d) this Article Twelve. Subject to compliance
with this Article Twelve, the Company may exercise its option
under this Section 1202 notwithstanding the prior exercise of its
option under Section 1203 with respect to the Notes.
Section 1203. Covenant Defeasance.
Upon the Company's exercise under Section 1201 of the
option applicable to this Section 1203, the Company and the
Guarantors shall be released from their obligations under any
covenant contained in Article Seven and Sections 904, 906, 907
and 911 through 929 with respect to the Outstanding Notes on and
after the date the conditions set forth in Section 1204 are
satisfied (hereinafter, "Covenant Defeasance"), and the Notes
shall thereafter be deemed not to be "Outstanding" for the
purposes of any direction, waiver, consent or declaration or Act
of Holders (and the consequences of any thereof) in connection
with such covenants, but shall continue to be deemed
"Outstanding" for all other purposes hereunder. For this
purpose, such Covenant Defeasance means that, with respect to the
Outstanding Notes, the Company and the Guarantors need not 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, but, except as specified above, the remainder of this
Indenture (including the Guarantee) and such Notes shall be
unaffected thereby. In addition, upon the Company's exercise
under Section 1201 of the option applicable to this Section 1203,
the events specified in clauses (c) and (d) (to the extent they
relate to any of the covenants from which the Company and the
Guarantors are being released pursuant to this Section 1203) and
clauses (e) through (o) of Section 401 shall not constitute
Events of Default.
Section 1204. Conditions to Legal Defeasance or
Covenant Defeasance.
The following shall be the conditions to application of
either Section 1202 or Section 1203 to the Outstanding Notes:
(1) The Company shall irrevocably deposit or cause to
be deposited with the Trustee (or another trustee satisfying
the requirements of Section 508 who shall agree to comply
with the provisions of this Article Twelve applicable to it)
as trust funds, in trust for the purpose of making the
following payments, specifically pledged as security for,
and dedicated solely to, the benefit of the Holders of such
Notes, (A) U.S. Dollars in an amount, or (B) U.S. Government
Obligations that through the scheduled payment of principal
and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due
date of any payment, U.S. Dollars in an amount, or (C) a
combination thereof, as in each case will be sufficient, in
the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and
which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge the principal of (and premium,
if any, on) and interest on the Outstanding Notes on the
stated date for payment thereof (or on the Redemption Date,
as the case may be, of such principal (and premium, if any)
or installment of principal, premium, if any or interest on
such Notes, and the Trustee on behalf of the Holders must
have a valid, perfected and exclusive security interest in
such trust; provided that the Trustee shall have been
irrevocably instructed to apply such U.S. Dollars or the
proceeds of such U.S. Government Obligations to such
payments with respect to the Notes. Before such a deposit,
the Company may give to the Trustee, in accordance with
Section 1003 hereof, a notice of its election to redeem all
of the Outstanding Notes at a future date in accordance with
Article Ten hereof, which notice shall be irrevocable. Such
irrevocable redemption notice, if given, shall be given
effect in applying the foregoing. For purposes of this
Article Twelve, "U.S. Government Obligations" means direct
non-callable obligations of, or non-callable obligations
guaranteed by, the United States of America for the payment
of which obligation or guarantee the full faith and credit
of the United States is pledged.
(2) No Default or Event of Default with respect to the
Notes shall have occurred and be continuing on the date of
such deposit or, insofar as paragraphs (h) and (i) of
Section 401 hereof are concerned, at any time during the
period ending on the ninety-first day after the date of such
deposit (it being understood that this condition shall not
be deemed satisfied until the expiration of such period).
(3) Such 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 the
Company Subsidiaries is a party or by which the Company or
any of the Company Subsidiaries is bound.
(4) In the case of an election under Section 1202, the
Company shall have delivered to the Trustee an Opinion of
Counsel, reasonably satisfactory in form and substance to
the Trustee, stating that (x) the Company has received from,
or there has been published by, the Internal Revenue Service
a ruling, or (y) since the date of this Indenture, there has
been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such
opinion shall confirm that, the Holders of the Outstanding
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.
(5) In the case of an election under Section 1203, the
Company shall have delivered to the Trustee an Opinion of
Counsel, reasonably satisfactory in form and substance to
the Trustee, to the effect that the Holders of the
Outstanding 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.
(6) The Company and Guarantors shall have delivered to
the Trustee Officers' Certificates stating that the deposit
made by the Company pursuant to its election under
Section 1202 or 1203 was not made with the intent of
preferring the Holders of such Notes over any other
creditors of the Company or such Guarantors or with the
intent of defeating, hindering, delaying or defrauding any
other creditors of the Company or such Guarantors or others.
(7) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for relating
to either the Legal Defeasance under Section 1202 or the
Covenant Defeasance under Section 1203 (as the case may be)
have been complied with.
Section 1205. Deposited U.S. Dollars and U.S.
Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of
Section 903 and Section 1206, all U.S. Dollars and U.S.
Government Obligations (including the proceeds thereof) deposited
with the Trustee (or other qualifying trustee, collectively for
purposes of this Section 1205, the "Trustee") pursuant to Section
1204 in respect of the Outstanding Notes shall be held in trust
(and subject to a first priority Lien in favor of the Trustee for
the benefit of the Holders) and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture,
to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums
due and to become due thereon in respect of principal (and
premium, if any) and interest, but such money need not be
segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against
any tax, fee or other charge imposed on, or assessed against, the
U.S. Government Obligations deposited pursuant to Section 1204 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 Twelve to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company
from time to time upon Company Request any U.S. Dollars or U.S.
Government Obligations held by it as provided in Section 1204
which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of
the amount thereof which would then be required to be deposited
to effect an equivalent Legal Defeasance or Covenant Defeasance,
as applicable, in accordance with this Article.
Section 1206. Repayment to the Company.
Any money deposited with the Trustee or any Paying
Agent, or then held by the Company, in trust for the payment of
the principal of, premium, if any, or interest on any Note and
remaining unclaimed for two years after such principal, and
premium, if any, or interest has become due and payable, shall be
paid to the Company on its request, and the Holder of such Note
shall thereafter look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with
respect to such trust money shall thereupon cease; provided,
however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the
Company cause to be published once, in The New York Times and The
Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such notification
or publication, any unclaimed balance of such money then
remaining will be repaid to the issuers.
Section 1207. Reinstatement.
If the Trustee or any Paying Agent is unable to apply
any U.S. Dollars or the proceeds of any U.S. Government
Obligations in accordance with Section 1205 by reason of any
order or judgment of any court or Governmental Authority
enjoining, restraining or otherwise prohibiting such application,
then the Company's and the Guarantor's obligations under this
Indenture (including the Guarantee) and the Notes shall be
revived and reinstated as though no deposit had occurred pursuant
to Section 1202 or 1203, as the case may be, until such time as
the Trustee or Paying Agent is permitted to apply all such U.S.
Dollars or the proceeds of any U.S. Government Obligations in
accordance with Section 1205; provided, however, that if the
Company makes any payment of principal of (or premium, if any,
on) or interest on any Note following 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 money held
by the Trustee or Paying Agent.
ARTICLE THIRTEEN
GUARANTEE OF NOTES
Section 1301. Guarantee.
Each of the Guarantors, for consideration received,
jointly and severally unconditionally and irrevocably guarantees
to each Holder of a Note and to the Trustee, the due and punctual
payment of the Indenture Obligations. The term "Indenture
Obligations" means any and all present and future obligations and
liabilities of the Company of every type and description to the
Holders under the Indenture, the Notes and any other Noteholder
Document, whether for principal, premium (if any), interest,
expenses, indemnities or other amounts, in each case whether due
or not due, absolute or contingent, voluntary or involuntary,
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, and whether or not recovery of
any such obligation or liability may be barred by a statute of
limitations or such obligation or liability may otherwise be
unenforceable. All Indenture Obligations shall be conclusively
presumed to have been created in reliance on the Guarantee. The
Guarantee is a continuing guaranty of the Indenture Obligations
and may not be revoked and shall not otherwise terminate unless
and until any and all Indenture Obligations have been
indefeasibly paid and performed in full, except as otherwise
provided in Section 1314.
Section 1302. Nature of Guarantee.
The liability of each Guarantor under the Guarantee is
independent of and not in consideration of or contingent upon the
liability of the Company or any other Guarantor and a separate
action or actions may be brought and prosecuted against any
Guarantor, whether or not any action is brought or prosecuted
against the Company or any other Guarantor or whether the Company
or any other Guarantor is joined in any such action or actions.
The Guarantee given by each Guarantor shall be construed as a
continuing, absolute and unconditional guaranty of payment (and
not merely of collection) without regard to:
(a) the legality, validity or enforceability of the
Notes, this Indenture or any other Noteholder Document, any of
the Indenture Obligations, any Lien on Collateral, the
Noteholder Security Interest or the Guarantee given by any other
Guarantor;
(b) any defense (other than payment), set-off or
counterclaim that may at any time be available to the Company or
any other Guarantor against, and any right of setoff at any time
held by, any Holder; or
(c) any other circumstance whatsoever (with or without
notice to or knowledge of any Guarantor or the Company), whether
or not similar to any of the foregoing, that constitutes, or
might be construed to constitute, an equitable or legal discharge
of the Company or any other Guarantor, in bankruptcy or in any
other instance.
Any payment by the Company or any Guarantor or other
circumstance that operates to toll any statute of limitations
applicable to such Persons shall also operate to toll the statute
of limitations applicable to each Guarantor.
Section 1303. Authorization.
Each Guarantor authorizes each Holder and the Trustee,
without notice to or further assent by such Guarantor, and
without affecting any Guarantor's liability hereunder (regardless
of whether any subrogation or similar right that such Guarantor
may have or any other right or remedy of such Guarantor is
extinguished or impaired), from time to time to do any or all of
the following:
(a) permit the Company to increase or create Indenture
Obligations, or terminate, release, compromise, subordinate,
extend, accelerate or otherwise change the amount or time, manner
or place of payment of, or rescind any demand for payment or
acceleration of, the Indenture Obligations or any part thereof,
consent or enter into supplemental indentures or otherwise amend
the terms and conditions of the Noteholder Documents or any
provision thereof;
(b) take and hold Collateral from the Company or any
other Person, perfect or refrain from perfecting a Lien on such
Collateral, and exchange, enforce, subordinate, release (whether
intentionally or unintentionally), or take or fail to take any
other action in respect of, any such Collateral or Lien or any
part thereof;
(c) exercise in such manner and order as it elects in
its sole discretion, fail to exercise, waive, suspend, terminate
or suffer expiration of, any of the remedies or rights of such
Holder against the Company or any Guarantor in respect of any
Indenture Obligation or any Collateral;
(d) release, add or settle with any Guarantor or the
Company in respect of the Guarantee or the Indenture Obligations;
(e) accept partial payments on the Indenture
Obligations and apply any and all payments or recoveries from any
Guarantor or the Company or Collateral to such of the Indenture
Obligations as any Holder may elect in its sole discretion,
whether or not such Indenture Obligations are secured or
guaranteed;
(f) refund at any time, at such Holder's sole
discretion, any payments or recoveries received by such Holder in
respect of any Indenture Obligations or Collateral; and
(g) otherwise deal with the Company, any Guarantor and
any Collateral as such Holder may elect in its sole discretion.
Section 1304. Right to Demand Full Performance.
In the event of any demand for payment or performance
by the Trustee from any Guarantor hereunder, the Trustee or the
Holders shall have the right to demand its full claim and to
receive all dividends or other payments in respect thereof until
the Indenture Obligations have been paid in full, and the
Guarantors shall continue to be jointly and severally liable
hereunder for any balance which may be owing to the Trustee or
the Holders by the Company under this Indenture and the Notes.
The retention by the Trustee or the Holders of any security,
prior to the realization by the Trustee or the Holders of its
rights to such security upon foreclosure thereon, shall not, as
between the Trustee and any Guarantor, be considered as a
purchase of such security, or as payment, satisfaction or
reduction of the Indenture Obligations due to the Trustee or the
Holders by the Company or any part thereof. Each Guarantor,
promptly after demand, will reimburse the Trustee and the Holders
for all costs and expenses of collecting such amount under, or
enforcing this Guarantee, including, without limitation, the
reasonable fees and expenses of counsel.
Section 1305. Certain Waivers.
Each Guarantor waives:
(a) the right to require the Holders to proceed
against the Company or any other Guarantor, to proceed against or
exhaust any Collateral or to pursue any other remedy in any
Holder's power whatsoever and the right to have the property of
the Company or any other Guarantor first applied to the discharge
of the Indenture Obligations;
(b) all rights and benefits under applicable law
purporting to reduce a guarantor's obligations in proportion to
the obligation of the principal or providing that the obligation
of a surety or guarantor must neither be larger nor in other
respects more burdensome than that of the principal;
(c) the benefit of any statute of limitations
affecting the Indenture Obligations or any Guarantor's liability
hereunder;
(d) any requirement of marshaling or any other
principle of election of remedies;
(e) any right to assert against any Holder any defense
(legal or equitable), set-off, counterclaim and other right that
any Guarantor may now or any time hereafter have against the
Company or any other Guarantor;
(f) presentment, demand for payment or performance
(including diligence in making demands hereunder), notice of
dishonor or nonperformance, protest, acceptance and notice of
acceptance of this Guarantee, and, except to the extent expressly
required by the Noteholder Documents, all other notices of any
kind, including (i) notice of any action taken or omitted by the
Holders in reliance hereon, (ii) notice of any default by the
Company or any other Guarantor, (iii) notice that any portion of
the Indenture Obligations is due, (iv) notice of any action
against the Company or any other Guarantor, or any enforcement of
other action with respect to any Collateral, or the assertion of
any right of any Holder hereunder; and
(g) all defenses that at any time may be available to
any Guarantor by virtue of any valuation, stay, moratorium or
other law now or hereafter in effect.
Section 1306. The Guarantors Remain Obligated in Event
the Company Is No Longer Obligated to
Discharge Indenture Obligations.
It is the express intention of the Trustee and the
Guarantors that if for any reason the Company has no legal
existence, is or becomes under no legal obligation to discharge
the Indenture Obligations owing to the Trustee or the Holders by
the Company or if any of the Indenture Obligations owing by the
Company to the Trustee or the Holders becomes irrecoverable from
the Company by operation of law or for any reason whatsoever,
this Guarantee and the covenants, agreements and obligations of
the Guarantors contained in this Article Thirteen shall
nevertheless be binding upon the Guarantors, as principal debtor,
until such time as all such Indenture Obligations have been paid
in full to the Trustee and all Indenture Obligations owing to the
Trustee or the Holders by the Company have been discharged, or
such earlier time as Section 1202 shall apply to the Notes, and
the Guarantors shall be responsible for the payment thereof to
the Trustee or the Holders upon demand.
Section 1307. Severability of Void Obligations under
Company Subsidiary Guarantee.
The obligations of any Guarantor hereunder shall be
limited to the maximum amount that would not render its
obligations hereunder subject to avoidance under Section 548 of
the Federal Bankruptcy Code or any applicable provisions of
comparable state law.
Section 1308. Guarantee Is in Addition to Other
Security.
This Guarantee shall be in addition to and not in
substitution for any other guarantees or other security which the
Trustee may now or hereafter hold in respect of the Indenture
Obligations owing to the Trustee or the Holders by the Company
and (except as may be required by law) the Trustee shall be under
no obligation to marshal in favor of each of the Guarantors any
other guarantees or other security or any moneys or other assets
which the Trustee may be entitled to receive or upon which the
Trustee or the Holders may have a claim.
Section 1309. Release of Noteholder Security Interest.
Without limiting the generality of the foregoing and
except as otherwise provided in this Indenture, each Guarantor
hereby consents and agrees, to the fullest extent permitted by
applicable law, that the rights of the Trustee hereunder, and the
liability of the Guarantors hereunder, shall not be affected by
any and all releases for any purpose of any Collateral, if any,
from the Noteholder Security Interest created by any Noteholder
Documents and that this Guarantee shall continue to be effective
or be reinstated, as the case may be, if at any time any payment
of any of the Indenture Obligations is rescinded or must
otherwise be returned by the Trustee upon the insolvency,
bankruptcy or reorganization of the Company or otherwise, all as
though such payment had not been made.
Section 1310. No Bar to Further Actions.
Except as provided by law, no action or proceeding
brought or instituted under Article Thirteen and the Guarantee
and no recovery or judgment in pursuance thereof shall be a bar
or defense to any further action or proceeding which may be
brought under Article Thirteen and the Guarantee by reason of any
further default or defaults under Article Thirteen and the
Guarantee or in the payment of any of the Indenture Obligations
owing by the Company.
Section 1311. Failure to Exercise Rights Shall Not
Operate as a Waiver; No Suspension of
Remedies.
(a) No failure to exercise and no delay in exercising,
on the part of the Trustee or the Holders, any right, power,
privilege or remedy under this Article Thirteen and the Guarantee
shall operate as a waiver thereof, nor shall any single or
partial exercise of any rights, power, privilege or remedy
preclude any other or further exercise thereof, or the exercise
of any other rights, powers, privileges or remedies. The rights
and remedies herein provided for are cumulative and not exclusive
of any rights or remedies provided in law or equity.
(b) Nothing contained in this Article Thirteen shall
limit the right of the Trustee or the Holders to take any action
to accelerate the maturity of the Notes pursuant to Article Four
and as set forth in the Indenture or to pursue any rights or
remedies hereunder or under applicable law.
Section 1312. Trustee's Duties; Notice to Trustee.
(a) Any provision in this Article Thirteen or
elsewhere in this Indenture allowing the Trustee to request any
information or to take any action authorized by, or on behalf of
any Guarantor, shall be permissive and shall not be obligatory on
the Trustee except as the Holders may direct in accordance with
the provisions of this Indenture or where the failure of the
Trustee to request any such information or to take any such
action arises from the Trustee's negligence, bad faith or willful
misconduct.
(b) The Trustee shall not be required to inquire into
the existence, powers or capacities of the Company, any Guarantor
or the officers, directors or agents acting or purporting to act
on their respective behalf.
Section 1313. Successors and Assigns.
All terms, agreements and conditions of this Article
Thirteen shall extend to and be binding upon each Guarantor and
its successors and permitted assigns and shall inure to the
benefit of and may be enforced by the Trustee and its successors
and assigns.
Section 1314. Release of Guarantee.
(a) In the event of a Restricted Asset Sale permitted
under Section 917 involving the sale by the Company of all of the
Capital Stock of any Company Subsidiary (other than BWBH or a
Non-Operating Subsidiary) or the sale by any Company Subsidiary
(other than BWBH or a Non-Operating Subsidiary) of all or
substantially all of the assets of such Company Subsidiary, other
than to another Company Subsidiary ("Subject Restricted Asset
Sale"), and subject to compliance with the provisions of Section
1105 (including the delivery of all required Officer's
Certificates) and to the requirements of subsection (b) of this
Section 1314, the Company Subsidiary whose Capital Stock or
assets are so sold shall be released from and relieved of its
obligations under this Article Thirteen.
(b) The Company shall deliver to the Trustee an
Officers' Certificate and an Opinion of Counsel to the effect
that the Subject Restricted Asset Sale giving rise to the release
of this Guarantee was consummated in accordance with the
provisions of this Indenture, the Notes and the other Noteholder
Documents, and upon receipt thereof by the Trustee, the Trustee
shall execute any documents reasonably required in order to
evidence the release of the Company Subsidiary relating to such
Subject Restricted Asset Sale from its obligations under this
Guarantee.
(c) Concurrently with the payment in full of all of
the Indenture Obligations, the Guarantors shall be released from
and relieved of their obligations under this Article Thirteen.
If any of the Indenture Obligations are revived and reinstated
after the termination of this Guarantee, then all of the
obligations of the Guarantors (other than any Company Subsidiary
that is otherwise released from the Guarantee pursuant to
subsection (a) of this Section 1314) under this Guarantee shall
be revived and reinstated as if this Guarantee had not been
terminated until such time as the Indenture Obligations are paid
in full, and each Guarantor shall enter into an amendment to this
Guarantee, reasonably satisfactory to the Trustee, evidencing
such revival and reinstatement.
Section 1315. Execution of Guarantee.
To evidence the Guarantee, each Guarantor hereby agrees
to execute a notation relating to the Guarantee to be endorsed on
each Note authenticated and delivered by the Trustee. Each
Guarantor agrees that this Indenture shall be executed on behalf
of each Guarantor by its Chairman of the Board, its President,
its Chief Executive Officer, Chief Operating Officer or one of
its Vice Presidents, under its corporate seal reproduced thereon
attested by its Secretary or one of its Assistant Secretaries.
The signature of any of these officers on the Notes may be manual
or facsimile.
If an officer whose signature is on this Indenture no
longer holds that office at the time the Trustee authenticates a
Note on which this Guarantee is endorsed, such Guarantee shall be
valid nevertheless.
Section 1316. No Subrogation; Certain Agreements.
(a) EACH GUARANTOR WAIVES ANY AND ALL RIGHTS OF
SUBROGATION, INDEMNITY OR REIMBURSEMENT, AND ANY AND ALL BENEFITS
OF AND RIGHTS TO ENFORCE ANY POWER, RIGHT OR REMEDY THAT ANY
HOLDER OR THE TRUSTEE MAY NOW OR HEREAFTER HAVE IN RESPECT OF THE
INDENTURE OBLIGATIONS AGAINST THE COMPANY OR ANY OTHER OBLIGOR
(OTHER THAN RIGHTS OF CONTRIBUTION FROM OTHER GUARANTORS), ANY
AND ALL BENEFITS OF AND RIGHTS TO PARTICIPATE IN ANY COLLATERAL,
WHETHER REAL OR PERSONAL PROPERTY, NOW OR HEREAFTER HELD BY ANY
HOLDER OR THE TRUSTEE, AND ANY AND ALL OTHER RIGHTS AND CLAIMS
(AS DEFINED IN THE FEDERAL BANKRUPTCY CODE) ANY GUARANTOR MAY
HAVE AGAINST THE COMPANY, UNDER APPLICABLE LAW OR OTHERWISE, AT
LAW OR IN EQUITY, BY REASON OF ANY PAYMENT UNDER THE GUARANTEE,
UNLESS AND UNTIL THE INDENTURE OBLIGATIONS SHALL HAVE BEEN PAID
IN FULL.
(b) Each Guarantor assumes the responsibility for
being and keeping itself informed of the financial condition of
each other Guarantor and of all other circumstances bearing upon
the risk of nonpayment of the Indenture Obligations or the
Guarantee of any other Guarantor that diligent inquiry would
reveal, and agrees that neither the Holders nor the Trustee shall
have any duty to advise any Guarantor of information regarding
such condition or any such circumstances.
Section 1317. Bankruptcy; No Discharge.
(a) Without limiting Section 1302 or any other
provision of this Article Thirteen, the Guarantee shall not be
discharged or otherwise affected by any bankruptcy,
reorganization or similar proceeding commenced by or against the
Company or any other Guarantor, including (i) any discharge of,
or bar or stay against collecting, all or any part of the
Indenture Obligations in or as a result of any such proceeding,
whether or not assented to by any Holder, (ii) any disallowance
of all or any portion of any Holder's claim for repayment of the
Indenture Obligations, (iii) any use of cash or other collateral
in any such proceeding, (iv) any agreement or stipulation as to
adequate protection in any such proceeding, (v) any failure by
any Holder to file or enforce a claim against the Company or any
other Guarantor or its estate in any bankruptcy or reorganization
case, (vi) any amendment, modification, stay or cure of any
Holder's rights that may occur in any such proceeding, (vii) any
election by any Holder under Section 1112(b)(2) of the Federal
Bankruptcy Code, or (viii) any borrowing or grant of a Lien under
Section 364 of the Federal Bankruptcy Code. Each Guarantor
understands and acknowledges that by virtue of this Guarantee, it
has specifically assumed any and all risks of any such proceeding
with respect to the Company and each other Guarantor.
(b) Notwithstanding anything in this Article Thirteen
to the contrary, any Event of Default under Section 401(h) or (i)
of this Indenture shall render all Indenture Obligations
automatically due and payable for purposes of the Guarantee,
without demand on the part of the Trustee or any Holder.
(c) Notwithstanding anything to the contrary herein
contained, the Guarantee (and any Lien on the Collateral securing
the Guarantee or the Indenture Obligations) shall continue to be
effective or be reinstated, as the case may be, if at any time
any payment, or any part thereof, of any or all of the Indenture
Obligations is rescinded, invalidated, declared to be fraudulent
or preferential or otherwise required to be restored or returned
by any Holder or the Trustee in connection with any bankruptcy,
reorganization or similar proceeding involving the Company, any
other Guarantor or otherwise, if the proceeds of any Collateral
are required to be returned by such Holder or the Trustee under
any such circumstances, or if any Holder or the Trustee elects to
return any such payment or proceeds or any part thereof in its
sole discretion, all as though such payment had not been made or
such proceeds not been received.
Section 1318. Additional Guarantors.
Each Company Subsidiary that executes and delivers to
the Trustee from time to time an amendment to the Guarantee after
the Issue Date shall be a Guarantor as if such Company Subsidiary
had been a signatory to this Indenture, and no such amendment to
the Guarantee must be executed and delivered by any other
Guarantor. Each Guarantor hereby consents to any such amendment,
whether or not it receives notice thereof.
ARTICLE FOURTEEN
MEETING OF NOTE HOLDERS
Section 1401. Purpose for Which Meeting May Be Called.
A meeting of Holders may be called at any time and from
time to time pursuant to the provisions of this Article Fourteen
for any of the following purposes:
(a) to give any notice to the Company or to the
Trustee, or to give any directions to the Trustee, or to
waive or consent to the waiver of any Default or Event of
Default hereunder and its consequences, or to take any other
action authorized to be taken by Holders pursuant to any of
the provisions of Article Four;
(b) to remove the Trustee or appoint a successor
Trustee pursuant to the provisions of Article Five;
(c) to consent to an amendment, supplement or
waiver pursuant to the provisions of Section 802; or
(d) to take any other action (i) authorized to be
taken by or on behalf of the Holder or Holders of any
specified aggregate principal amount of the Notes under any
other provision of this Indenture or the other Noteholder
Documents, or authorized or permitted by law or (ii) which
the Trustee deems necessary or appropriate in connection
with the administration of this Indenture or the other
Noteholder Documents.
Section 1402. Manner of Calling Meeting.
The Trustee may at any time call a meeting of the
Holders to take any action specified in Section 1401 to be held
at such time and at such place in the City of New York, State of
New York or elsewhere as the Trustee shall determine. Notice of
every meeting of Holders, setting forth the time and place of
such meeting and in general terms the action proposed to be taken
at such meeting, shall be mailed by the Trustee, first-class
postage prepaid, to the Company and to the Holders at their last
addresses as they shall appear on the registration books of the
Note Registrar, not less than 10 nor more than 60 days prior to
the date fixed for a meeting.
Any meeting of Holders shall be valid without notice if
the Holders of all Notes then outstanding are present in person
or by proxy, or if notice is waived before or after the meeting
by the Holders of all Notes outstanding, and if the Company and
the Trustee are either present by duly authorized representatives
or have received notice of the meeting or, before or after the
meeting, waived notice.
Section 1403. Call of Meeting by Company or Holders.
In case at any time the Company, pursuant to a Board
Resolution, or the Holders of not less than 10% in aggregate
principal amount of the Notes then outstanding shall have
requested the Trustee to call a meeting of Holders to take any
action specified in Section 1401, by written request setting
forth in reasonable detail the action proposed to be taken at the
meeting, and the Trustee shall not have mailed the notice of such
meeting within 20 days after receipt of such request, then the
Company or such Holders of Notes may determine the time and place
in the City of New York, State of New York or elsewhere for such
meeting and may call such meeting for the purpose of taking such
action, by mailing or causing to be mailed notice thereof as
provided in Section 1402, or by causing notice thereof to be
published at least once in each of two successive calendar weeks
(on any Business Day during such week) in a newspaper or
newspapers of general circulation in the City of New York, State
of New York printed in the English language and customarily
published at least five days a week, the first such publication
to be not less than 10 nor more than 60 days prior to the date
fixed for the meeting.
Section 1404. Who May Attend and Vote at Meetings.
To be entitled to vote at any meeting of Holders, a
Person must be (a) a registered Holder of one or more Notes, or
(b) a Person appointed by an instrument in writing as proxy for
the registered Holder or Holders of Notes. The only persons who
shall be entitled to be present or to speak at any meeting of
Holders shall be the Persons entitled to vote at such meeting and
their counsel, representatives of the Trustee and its counsel and
representatives of the Company, any of the Guarantors and their
counsel.
Section 1405. Regulations May Be Made by Trustee;
Conduct of the Meeting; Voting Rights;
Adjournment.
Notwithstanding any other provision of this Indenture,
the Trustee may make such reasonable regulations as it may deem
advisable for any action by or any meeting of Holders regarding
proof of the holding of Notes and of the appointment of proxies,
and regarding the appointment and duties of inspectors of votes,
and submission and examination of proxies, certificates and other
evidence of the right to vote, and such other matters concerning
the conduct of the meeting as it shall deem appropriate. Such
regulations may fix a record date and time for determining the
Holders of record of Notes entitled to vote at such meeting, in
which case those and only those Persons who are Holders of Notes
at the record date and time so fixed, or their proxies, shall be
entitled to vote at such meeting whether or not they shall be
such Holders at the time of the meeting.
The Trustee shall, by an instrument in writing, appoint
a temporary chairman of the meeting, unless the meeting shall
have been called by the Company or by Holders as provided in
Section 1403, in which case, the Company or Holders calling the
meeting, as the case may be, shall in like manner appoint a
temporary chairman. A permanent chairman and permanent secretary
of the meeting shall be elected by vote of the Holders of a
majority in principal amount of the Outstanding Notes represented
at the meeting and entitled to vote.
At any meeting each Holder or proxy shall be entitled
to one vote for each $100 principal amount of Notes held or
represented by such Holder; provided, however, that no vote shall
be cast or counted at any meeting in respect of any Notes
challenged as not Outstanding and ruled by the chairman of the
meeting to be not Outstanding. The chairman of the meeting shall
have no right to vote other than by virtue of the Notes held by
him or instruments in writing as aforesaid duly designating him
as the proxy to vote on behalf of other Holders. Any meeting of
Holders duly called pursuant to the provisions of Section 1402 or
Section 1403 may be adjourned from time to time by vote of the
Holder or Holders of a majority in aggregate principal amount of
the Notes represented at the meeting and entitled to vote, and
the meeting may be held as so adjourned without further notice.
Section 1406. Voting at the Meeting and Record to Be
Kept.
The vote upon any resolution submitted to any meeting
of Holders shall be by written ballots on which shall be
subscribed the signatures of the Holders of Notes or of their
representatives by proxy and the principal amount of the Notes
voted by the ballot. The permanent chairman of the meeting shall
appoint two inspectors of votes, who shall count all votes cast
at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record
in duplicate of the proceedings of each meeting of Holders shall
be prepared by the secretary of the meeting and there shall be
attached to such record the original reports of the inspectors of
votes on any vote by ballot taken thereat and affidavits by one
or more Persons having knowledge of the facts, setting forth a
copy of the notice of the meeting and showing that such notice
was mailed as provided in Section 1402 or published as provided
in Section 1403. The record shall be signed and verified by the
affidavits of the permanent chairman and the secretary of the
meeting and one of the duplicates shall be delivered to the
Company and the other to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at
the meeting.
Any record so signed and verified shall be conclusive
evidence of the matters therein stated.
Section 1407. Exercise of Rights of Trustee or
Noteholders May Not Be Hindered or
Delayed by Call of Meeting.
Nothing contained in this Article Fourteen shall be
deemed or construed to authorize or permit, by reason of any call
of a meeting of Holders or any rights conferred hereunder,
expressed or implied, to make such call, any hindrance or delay
in the exercise of any right or rights conferred upon or reserved
to the Trustee or to the Holders under any of the provisions of
the Indenture (including with respect to the Guarantee), the
Notes or the other Noteholder Documents.
ARTICLE FIFTEEN
MISCELLANEOUS
Section 1501. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with any other provision hereof that is then required
to be included in this Indenture by any of the provisions of the
Trust Indenture Act, such required provision shall control.
Section 1502. Notices.
Any notice or communication shall be sufficiently given
if in writing and delivered in person or mailed by certified or
registered mail (return receipt requested) or sent by facsimile
transmission addressed as follows:
If to the Company:
Colorado Gaming & Entertainment Co.
One Norwest Center
1700 Lincoln
Denver, Colorado 80203
Attn.: Alan Mayer, Esq.
with a copy to:
LeBoeuf, Lamb, Greene & MacRae, L.L.P.
633 Seventeenth Street - Suite 2800
Denver, Colorado 80202
Attn.: Thomas J. Moore, Esq.
If to the Trustee:
Fleet National Bank
777 Main Street
Hartford, Connecticut
Attn.: Corporate Trust Department
with a copy to:
Shipman & Goodwin
One American Row
Hartford, Connecticut 06103-2819
Attn.: Thomas F. Tresselt, Esq.
The Company or the Trustee by notice to the other may
designate an additional or different address for subsequent
notices or communications.
Any notice or communication mailed to a Holder shall be
mailed to him by first-class mail at his address as it appears on
the registration books of the Note Registrar and shall be
sufficiently given to him if so mailed within the time prescribed
herein.
Failure to mail, or any defect in, a notice or
communication to a Holder shall not affect the sufficiency
thereof with respect to other Holders. If a notice or
communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
Section 1503. Successors and Assigns.
All covenants and agreements in this Indenture and in
the other Noteholder Documents by the Company and each Guarantor
shall bind their respective successors and permitted assigns,
whether so expressed or not.
Section 1504. Benefits of Noteholder Documents.
Nothing in this Indenture, the Notes or the other
Noteholder Documents, express or implied, shall give to any
Person, other than the parties hereto, any Paying Agent, any Note
Registrar and their successors hereunder, and the Holders, any
benefit or any legal or equitable right, remedy or claim under
this Indenture.
Section 1505. Legal Holidays.
In any case where any Interest Payment Date, Redemption
Date, Purchase Date or Stated Maturity or Maturity of any Note
shall not be a Business Day, then (notwithstanding any other
provision of this Indenture or of the Notes) payment of interest
or principal (and premium, if any) need not be made on such date,
but may be made on the next succeeding Business Day with the same
force and effect as if made on the Interest Payment Date,
Redemption Date, Purchase Date or at the Stated Maturity or
Maturity of such Note without additional interest.
Section 1506. Exhibits and Schedules.
All of the Exhibits and Schedules attached to this
Indenture shall be deemed incorporated herein by reference and
made a part of this Indenture.
Section 1507. Governing Law.
(a) THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW. EACH
OF THE COMPANY, THE GUARANTORS, THE TRUSTEE AND THE HOLDERS
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 INDENTURE AND THE
NOTES, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE
AFORESAID COURTS. EACH OF THE COMPANY, THE GUARANTORS, THE
TRUSTEE AND THE HOLDERS IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, TRIAL BY JURY AND
ANY OBJECTION WHICH 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. EACH OF THE COMPANY, THE GUARANTORS, THE TRUSTEE AND THE
HOLDERS IRREVOCABLY CONSENTS, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, TO THE SERVICE OF PROCESS
OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY AT ITS SAID
ADDRESS, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH
MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR
ANY HOLDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE
COMPANY OR ANY GUARANTOR IN ANY OTHER JURISDICTION.
(b) The Company and each Guarantor hereby irrevocably
appoints CT Corporation System (the "Process Agent," which has
consented thereto) with offices on the date hereof at
[__________], as Process Agent to receive for and on behalf of
the Company or such Guarantor, as the case may be, service of
process in the County of New York relating to this Indenture and
the Notes. SERVICE OF PROCESS IN ANY SUIT, ACTION OR PROCEEDING
AGAINST THE COMPANY OR ANY GUARANTOR MAY BE MADE ON THE PROCESS
AGENT BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED,
OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER APPLICABLE
LAWS IN EFFECT IN THE STATE OF NEW YORK, AND THE PROCESS AGENT IS
HEREBY AUTHORIZED AND DIRECTED TO ACCEPT SUCH SERVICE FOR AND ON
BEHALF OF THE COMPANY OR SUCH GUARANTOR, AS THE CASE MAY BE, AND
TO ADMIT SERVICE WITH RESPECT THERETO. SUCH SERVICE UPON THE
PROCESS AGENT SHALL BE DEEMED EFFECTIVE PERSONAL SERVICE ON THE
COMPANY OR SUCH GUARANTOR, AS THE CASE MAY BE, SUFFICIENT FOR
PERSONAL JURISDICTION, 10 DAYS AFTER MAILING, AND SHALL BE LEGAL
AND BINDING UPON THE COMPANY OR SUCH GUARANTOR, AS THE CASE MAY
BE, FOR ALL PURPOSES, NOTWITHSTANDING ANY FAILURE OF THE PROCESS
AGENT TO MAIL COPIES OF SUCH LEGAL PROCESS TO THE COMPANY OR SUCH
GUARANTOR, AS THE CASE MAY BE, OR ANY FAILURE ON THE PART OF THE
COMPANY OR SUCH GUARANTOR, AS THE CASE MAY BE, TO RECEIVE THE
SAME. The Company and each Guarantor confirms that it has
instructed the Process Agent to mail to such Person, upon service
of process being made on the Process Agent pursuant to this
Section, a copy of the summons and complaint or other legal
process served upon it, by registered mail, return receipt
requested, at such Person's address set forth in Schedule 106, or
to such other address as such Person may notify the Process Agent
in writing. The Company and each Guarantor agrees that it will
at all times maintain a process agent to receive service of
process in the County of New York on its behalf with respect to
this Indenture and the Notes. If for any reason the Process
Agent or any successor thereto shall no longer serve as such
process agent or shall have changed its address without
notification thereof to the Trustee, the Company or such
Guarantor, as the case may be, immediately after gaining
knowledge thereof, irrevocably shall appoint a substitute process
agent acceptable to the Trustee in the County of New York and
advise the Trustee thereof.
Section 1508. No Adverse Interpretation of Other
Agreements.
This Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or a Company
Subsidiary. Any such indenture, loan or debt agreement may not
be used to interpret this Indenture.
Section 1509. No Recourse Against Others.
A director, officer, employee, stockholder or
incorporator, as such, of the Company, any Guarantor or any
Company Subsidiary shall not have any liability for any
obligations of the Company, any Guarantor or any Company
Subsidiary under the Notes, this Indenture, the other Noteholder
Documents or the Guarantee or for any claim based on, in respect
of or by reason of, such obligations or their creation. Each
Holder by accepting a Note waives and releases all such
liability.
Section 1510. Severability Clause.
In case any provision in this Indenture or in the Notes
shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
Section 1511. Duplicate Originals.
The 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 instrument.
Section 1512. Table of Contents, Headings, Etc.
The Article and Section headings herein and the Table
of Contents are for convenience only and shall not affect the
construction hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate
seals to be hereunto affixed and attested, all as of the day and
year first above written.
COLORADO GAMING & ENTERTAINMENT CO.
By: . . . . . . . . . . . . . . . . . . .
Name:
Title:
BWBH, INC.
By: . . . . . . . . . . . . . . . . . . .
Name:
Title:
BWCC, INC.
By: . . . . . . . . . . . . . . . . . . .
Name:
Title:
MILLSITE 27, INC.
By: . . . . . . . . . . . . . . . . . . .
Name:
Title:
SILVER HAWK CASINO, INC.
By: . . . . . . . . . . . . . . . . . . .
Name:
Title:
FLEET NATIONAL BANK, as Trustee
By: . . . . . . . . . . . . . . . . . . .
Name:
Title:
