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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 30, 1996
FITZGERALDS GAMING CORPORATION
(Exact name of registrant as specified in its charter)
NEVADA
(State or other jurisdiction of incorporation)
0-26518 88-0329170
(Commission File Number) (IRS Employer Identification No.)
301 FREMONT STREET, LAS VEGAS, NEVADA 89101
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code): (702) 388-2400
NA
(Former name or former address, if changed since last report)
Page 1 of 4
Exhibit Index at Page 4
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ITEM 5. OTHER EVENTS.
Priority Secured Notes Borrowing
On December 30, the Registrant sold $5,882,000 principal
amount of 13% Priority Secured Notes due December 31, 1998 (the "Priority
Secured Notes") from which it received net proceeds of $4,910,464. Such amount
will be reduced by approximately $180,000 in related expenses. The Priority
Secured Notes mature on December 31, 1998, but may be retired earlier at any
time at the option of the Registrant, and bear interest at 13% per annum,
payable semi-annually. Repayment of the Priority Secured Notes is guaranteed by
the Registrant's subsidiaries. The Priority Secured Notes and subsidiary
guarantees are secured, directly or indirectly, by some or all of the same
assets of the Registrant and its subsidiaries which serve as collateral for the
Registrant's existing 13% Senior Secured Notes due 2002 With Contingent Interest
(the "Senior Secured Notes") issued on December 19, 1995.
The Priority Secured Notes rank senior to the Senior Secured
Notes and the liens securing the Priority Secured Notes rank senior to the liens
securing the Senior Secured Notes. As a result, the holders of the Priority
Secured Notes are entitled to have their Priority Secured Notes paid from the
proceeds obtained upon liquidation of the Registrant's assets before any such
proceeds are used to pay the Senior Secured Notes. Similarly, in the event of a
sale of assets requiring the application of net cash proceeds to repurchase
Senior Secured Notes, the holders of the Priority Secured Notes are entitled to
have their Priority Secured Notes repaid first. Except as described above, the
covenants, events of default and other provisions imposed under the Priority
Secured Notes are substantially the same as those contained in the Indenture
governing the Senior Secured Notes (the "Senior Secured Notes Indenture").
In connection with the issuance of the Priority Secured Notes,
the Registrant solicited and obtained the consents of all the holders of the
Senior Secured Notes to amend the Senior Secured Notes Indenture and to make
conforming changes to the collateral documents relating to the Senior Secured
Notes pursuant to a First Supplemental Indenture and Global Amendment to
Collateral Documents, each dated as of December 30, 1996, in the forms attached
as Exhibits hereto.
Management Changes
In an effort to reduce administrative costs, effective January
1, 1997, Jerome H. Turk resigned from his positions as Chairman of the Board and
a Director, and became a part-time employee of the Registrant. In addition, the
Registrant is considering reducing the size of its Board of Directors from four
to three members and restructuring the membership thereof by replacing the two
outside directors, Patricia W. Becker and Michael A. Ficaro, with executive
officers of the Company who would serve on the Board without separate
compensation therefor. Mr. Turk resigned voluntarily and did not resign because
of a disagreement with the
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Exhibit Index at Page 4
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Registrant on any matter relating to the Registrant's operations, policies or
practices. Similarly, the additional Board changes under consideration do not
relate to any disagreement with the Registrant.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
FITZGERALDS GAMING CORPORATION
(Registrant)
January 10, 1997 By: /s/ FERNANDO BENSUASKI
------------------------ -----------------------------------
Date Fernando Bensuaski
Executive Vice President, Chief
Financial Officer and Secretary
Page 3 of 4
Exhibit Index at Page 4
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
4.1 First Supplemental Indenture
10.1 Note Purchase Agreement
10.2 Global Amendment to Collateral Documents
Page 4 of 4
Exhibit Index at Page 4
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EXHIBIT 4.1
================================================================================
FITZGERALDS GAMING CORPORATION
Issuer
AND
FITZGERALDS SOUTH, INC.
FITZGERALDS RENO, INC.
FITZGERALDS INCORPORATED
FITZGERALDS LAS VEGAS, INC.
FITZGERALDS FREMONT EXPERIENCE CORPORATION
FITZGERALDS MISSISSIPPI, INC. (Formerly POLK
LANDING ENTERTAINMENT CORPORATION)
FITZGERALDS BLACK HAWK, INC.
Subsidiary Guarantors
AND
WELLS FARGO BANK, N.A. (Formerly
FIRST INTERSTATE BANK OF NEVADA, N.A.)
Trustee
----------------------------
FIRST SUPPLEMENTAL INDENTURE
----------------------------
Dated as of December 30, 1996
----------------------------
$123,000,000
13% Senior Secured Notes Due 2002 With Contingent Interest
================================================================================
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FIRST SUPPLEMENTAL INDENTURE (hereinafter, the "FIRST SUPPLEMENTAL
INDENTURE"), dated as of December 30, 1996, among FITZGERALDS GAMING
CORPORATION, a Nevada corporation, as Issuer (the "COMPANY"), and FITZGERALDS
SOUTH, INC., a Nevada corporation, FITZGERALDS RENO, INC., a Nevada corporation,
FITZGERALDS INCORPORATED, a Nevada corporation, FITZGERALDS LAS VEGAS, INC., a
Nevada corporation, FITZGERALDS FREMONT EXPERIENCE CORPORATION, a Nevada
corporation, FITZGERALDS MISSISSIPPI, INC. (formerly named POLK LANDING
ENTERTAINMENT CORPORATION), a Mississippi corporation, and FITZGERALDS BLACK
HAWK, INC., a Nevada corporation, as Subsidiary Guarantors, and WELLS FARGO
BANK, N.A. (formerly FIRST INTERSTATE BANK OF NEVADA, N.A.), as Trustee (the
"Trustee").
A. The Company and the Subsidiary Guarantors have executed and
delivered to the Trustee an Indenture dated as of December 19, 1995 (the
"Indenture"), providing for the issuance of $123,000,000 principal amount of the
Company's 13% Senior Secured Notes due 2002 with Contingent Interest (the
"NOTES").
B. The Company and the Subsidiary Guarantors desire to amend the
Indenture in accordance with Article Nine thereof as follows, which amendments
have been authorized by the holders of all of the outstanding Notes pursuant to
Section 902 of the Indenture.
In consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the Company, the
Subsidiary Guarantors and the Trustee hereby amend the Indenture as follows:
1. SECTION 101 IS HEREBY AMENDED TO ADD THE FOLLOWING DEFINED
TERMS (TO APPEAR IN ALPHABETICAL ORDER WITH ALL DEFINED TERMS IN SUCH SECTION
101) TO READ IN THEIR ENTIRETIES AS FOLLOWS:
"BANKRUPTCY CODE" means Title 11 of the United States Code.
"BANKRUPTCY, INSOLVENCY OR LIQUIDATION PROCEEDING" means (i)
any case commenced by or against the Company or any Subsidiary Guarantor under
any chapter of the Bankruptcy Code, any other proceeding for the reorganization,
recapitalization or adjustment or marshaling of the assets or liabilities of the
Company or any Subsidiary Guarantor, any receivership or assignment for the
benefit of creditors relating to the Company or any Subsidiary Guarantor or any
similar case or proceeding relative to the Company or any Subsidiary Guarantor
or their respective creditors, as such, in each case whether or not voluntary,
(ii) any liquidation, dissolution, marshaling of assets or liabilities or other
winding up of or relating to the Company or any Subsidiary Guarantor, in each
case whether or not voluntary and whether or not involving bankruptcy or
insolvency, and (iii) any other
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proceeding of any type or nature in which claims against the Company or any
Subsidiary Guarantor generally are determined, proven or paid.
"DISALLOWED POST-PETITION INTEREST/EXPENSE CLAIMS" means any
claim for interest on the Priority Notes (including accretion of original issue
discount and any applicable post-default rate) accruing after the commencement
of any Bankruptcy, Insolvency or Liquidation Proceeding at the rate (including
any applicable post-default rate) set forth in the Priority Notes or the
Priority Notes Agreement or for fees, expense reimbursements, indemnification or
other similar obligations arising or accruing under the Priority Notes Agreement
after the commencement of any Bankruptcy, Insolvency or Liquidation Proceeding,
if such claim is not allowed, allowable or enforceable in such Bankruptcy,
Insolvency or Liquidation Proceeding.
"DISCHARGE OF THE PRIORITY OBLIGATIONS" means that all
Priority Note Obligations and all Senior Claims (except indemnification
obligations which are then contingent and as to which no payment is then due and
no claim or demand has then been made) have been paid in full and in cash.
"FIRST SUPPLEMENTAL INDENTURE" means the First Supplemental
Indenture dated as of December 30, 1996, among the Company, the Subsidiary
Guarantors and Wells Fargo Bank, N.A., as Trustee.
"FITZGERALDS BLACK HAWK" means Fitzgeralds Black Hawk Casino
located in Black Hawk, Colorado.
"PRIORITY NOTE OBLIGATIONS" means the obligations of the
Company to pay principal of (and premium, if any) and interest (including
accretion of original issue discount and any applicable post-default rate) on
the Priority Notes, all guaranties thereof made by any Subsidiary Guarantors,
and all obligations of the Company or any Subsidiary Guarantor for fees, expense
reimbursement, compensation, indemnification or other similar obligations at any
time arising or accruing under the Priority Notes Agreement.
"PRIORITY NOTES" means the Company's Priority Secured Notes
due December 31, 1998 outstanding pursuant to the Priority Notes Agreement and
all other instruments evidencing the indebtedness that is evidenced by such
Priority Secured Notes, as such Priority Secured Notes and instruments from time
to time may be amended.
"PRIORITY NOTES AGREEMENT" means the Note Purchase Agreement
dated as of December 30, 1996, among the Company, the Subsidiary Guarantors and
the purchasers listed on the signature pages thereto, as such agreement from
time to time may be amended.
"PRIORITY NOTES COLLATERAL" means all Collateral upon which a
Lien securing any of the Priority Note Obligations is held by the Trustee or
Collateral Agent.
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"PRIORITY NOTES COLLATERAL DOCUMENTS" means the Global
Amendment to Collateral Documents dated as of December 30, 1996, by and among
the Company and the then Subsidiary Guarantors and Trustee, all Collateral
Documents executed and delivered after delivery of the First Supplemental
Indenture and prior to Discharge of the Priority Obligations, and each other
instrument or agreement by which any of the Priority Note Obligations becomes
secured by any Lien granted to the Trustee or Collateral Agent.
"PRIORITY NOTES DEFAULT" means the failure to pay when due any
principal of or interest on the Priority Notes or any event upon the occurrence
of which one or more of the holders of Priority Notes are permitted (under the
terms of the Priority Notes Agreement) either to accelerate the maturity of the
Priority Notes or to direct the Trustee or Collateral Agent to foreclose upon or
enforce any Lien upon any Priority Notes Collateral and specifically includes
each "Event of Default," as that term is defined in the Priority Notes Agreement
as in effect on the date of the First Supplemental Indenture.
"SENIOR CLAIMS" means the Priority Note Obligations and
Disallowed Post-Petition Interest/Expense Claims.
"SUBORDINATED CLAIMS" means the principal of (and premium, if
any) and interest, including Contingent Interest, on the Notes and all other
obligations arising under the Notes and Subsidiary Guarantee.
2. SECTION 101 IS HEREBY FURTHER AMENDED TO MODIFY THE
FOLLOWING DEFINED TERMS TO READ IN THEIR ENTIRETIES AS FOLLOWS:
"COLLATERAL" means all property and interests in property now
owned or hereafter acquired by any Note Party in or upon which a Lien is granted
for the benefit of the Beneficiaries (whether directly or by way of assignment
of a Lien granted to the Company) under any of the Collateral Documents, which
Lien shall, until Discharge of the Priority Obligations, also serve the Priority
Note Obligations.
"COLLATERAL AGENT" means (i) First Interstate, as collateral
agent for itself and the Holders and, until Discharge of the Priority
Obligations, the Holders of Priority Note Obligations under the Collateral
Documents, or (ii) the "Collateral Agent" as defined in and under any
Intercreditor Agreement.
"COLLATERAL DOCUMENTS" means, collectively, (i) the Company
Accounts Pledge Agreement, the Company Pledge Agreement, the Company Security
Agreement, the Subsidiary Pledge Agreement, the Subsidiary Security Agreement,
the FLVI Mortgage, the FRI Mortgage (if any), the PLEC Mortgage, the PLEC Ship
Mortgage, and the Disbursement Agreements, and (ii) any other Mortgages, Ship
Mortgages, Accounts Pledge Agreements and other security documents entered into
by the Company or any Restricted Subsidiary to secure their respective
obligations under the Note Documents, in each case as amended from time to time,
including amendments pursuant to any Priority Notes Collateral Document.
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"EXCLUDED ASSETS" means:
(i) the leased portions of Fitzgeralds Las Vegas, unless
and until the consent of the related lessors to pledge the leases is obtained,
(ii) except to the extent such assets are covered by Exhibit
A to the FLVI Mortgages, the assets of FRI, including Fitzgeralds Reno, but only
for so long as such assets are subject to a Lien listed on Schedule 101B (or any
Permitted Lien under clause (g) of the definition of "Permitted Lien" with
respect to such Lien);
(iii) cash, deposit accounts and other cash equivalents,
including those derived from the operation of Gaming Equipment (as defined in
the Company Security Agreement or the Subsidiary Security Agreement) and related
food and beverage service, but excluding (A) those included in the Note Proceeds
Accounts, Note Proceeds Account Collateral or Asset Sale Account Collateral, (B)
proceeds, products, rents and issues of any Collateral (other than proceeds and
products of food, beverage and gift shop inventories), and (C) without
limitation of clause (B), all rights to payment and payments for hotel room
occupancy (and related reservations, tour and junket proceeds, and deposits for
convention and party reservations);
(iv) (A) any equipment subject to Liens listed on Schedule
101B securing Existing Indebtedness and (B) any newly acquired or leased assets
financed with Permitted FF&E Financing or Non-Recourse Indebtedness to the
extent that a Lien on any such assets is expressly prohibited by the terms of
such permitted FF&E Financing or Non-Recourse Indebtedness and the lender under
such Permitted FF&E Financing or Non-Recourse Indebtedness has not consented to
a Lien on such assets;
(v) any agreement with a third party, existing on the date
on which the relevant Collateral Document is required to be executed hereunder,
that prohibits the grant of a Lien on such agreement or any of the relevant
rights thereunder without the consent of such party or under which a consent to
such grant is otherwise required, which consent has not been obtained, except to
the extent rights under any such agreement are covered by Section 9-318 of the
relevant Uniform Commercial Code (or any successor provision);
(vi) any license, permit or other Governmental Approval that,
under the terms and conditions of such Governmental Approval or under Applicable
Law, cannot be subjected to a Lien in favor of the Company or the Collateral
Agent, as applicable, without the consent of the relevant Governmental
Authority, which consent has not been obtained;
(vii) Capital Stock of any Unrestricted Subsidiary; and
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(viii) In the event that a Subsidiary Guarantor Incurs
Permitted Black Hawk Indebtedness in the form of Non-Recourse Indebtedness to
acquire Main Street pursuant to the Main Street Option Agreement, Fitzgeralds
Black Hawk and the other assets, if any, of Main Street;
provided, however, that Excluded Assets shall not include the
proceeds, products, rents, issues, income and profits (collectively, the
"PROCEEDS") of the assets referred to in clause (i), (ii), (iv), (v), (vi) or
(vii) above to the extent such Proceeds do not constitute Excluded Assets
pursuant to clause (iii) above.
"PARI PASSU INDEBTEDNESS" means Indebtedness of the Company or
any Subsidiary Guarantor that (i) is not Subordinated Indebtedness, (ii) except
in the case of Permitted Construction Indebtedness, matures not before the
Stated Maturity, (iii) except in the case of Permitted Construction
Indebtedness, has an Average Life not shorter than that applicable to the Notes,
and (iv) if such Indebtedness is secured by any assets, (A) the Notes or the
Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, are
secured by a first Priority Lien on the same assets, and (B) the Lien securing
such Indebtedness is equal and ratable with the Lien securing the Notes or the
Subsidiary Guarantee, as applicable, pursuant to an Intercreditor Agreement;
provided that such Liens shall be subject and subordinate to Liens under the
Priority Notes Collateral Documents securing Priority Note Obligations.
"PERMITTED BLACK HAWK INDEBTEDNESS" means, in the alternative,
either (x) Pari Passu Indebtedness or Subordinated Indebtedness of the Company
(and Pari Passu Indebtedness or Subordinated Indebtedness of any Subsidiary
Guarantor in the form of Guarantees of such Pari Passu Indebtedness or
Subordinated Indebtedness of the Company, as applicable) or (y) Non-Recourse
Indebtedness of any Subsidiary Guarantor, in each case in respect of the
purchase price payable by the Company to exercise its rights to acquire
membership interests in Main Street pursuant to the Main Street Option Agreement
(including Indebtedness of Main Street outstanding at the time of such
acquisition), provided that such Indebtedness does not exceed in aggregate
principal amount (including any Refinancing Indebtedness with respect to such
Indebtedness and together with any Indebtedness of Main Street outstanding at
the time of such incurrence) the lesser of (a) $65,000,000 and (b) in the case
of Pari Passu Indebtedness only, 75% of the higher of (i) such purchase price
and (ii) the Fair Market Value of the membership interests so purchased, as set
forth in an appraisal from a national or regional independent investment banking
firm with recognized experience in the gaming industry, which appraisal shall
have been delivered to the Trustee; provided, however, that the Trustee shall
have no duty to review or examine such appraisal.
"PERMITTED INTERCOMPANY LOAN" means any loan made by the
Company to any Restricted Subsidiary that (i) is evidenced by a Permitted
Intercompany Note, (ii) provides for interest payments at the same rate and at
the same times as the Notes and the principal amount of and all accrued interest
on such loan is due and payable on demand, (iii) ranks at least pari passu in
right of payment with all other Indebtedness of such Restricted Subsidiary,
except as contemplated by the Company Pledge Agreement, (iv) except as provided
herein, is secured by a Lien on substantially all assets of such Restricted
Subsidiary other than Negative Pledge
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Assets, which Lien shall be (a) of first priority or, in the case of a
Restricted Subsidiary that is a Subsidiary Guarantor, which Lien shall be
subject only to a prior Lien (or, until Discharge of the Priority Obligations,
junior Lien) on the same assets securing the Subsidiary Guarantee, and (b) equal
and ratable with any other Liens securing Indebtedness on the same assets
pursuant to an Intercreditor Agreement, and (v) together with the Permitted
Intercompany Note and any related Collateral and Liens, is pledged to the
Collateral Agent for the benefit of the Holders and, until Discharge of the
Priority Obligations, the Holders of Priority Note Obligations.
"PERMITTED LIENS" means any of the following:
(a) Liens arising by reason of any judgment, decree or order
of any court only to the extent for an amount and for a period not resulting in
an Event of Default with respect thereto and so long as such Lien is being
contested in good faith and is adequately bonded, and any appropriate legal
proceedings that may have been duly initiated for the review of such judgment,
decree or order shall not have been finally adversely terminated or the period
within which such proceedings may be initiated shall not have expired;
(b) Security for the performance of bids, tenders, trade,
contracts (other than contracts for the payment of money) or leases, surety
bonds, performance bonds and other obligations of a like nature Incurred in the
ordinary course of business or appeal bonds, and public and statutory bonds;
(c) Liens (other than Liens arising under ERISA) for taxes,
assessments or other governmental charges not yet due or which are being
contested in good faith and by appropriate proceedings by the Company if
adequate reserves with respect thereto are maintained on the books of the
Company in accordance with GAAP;
(d) Liens of carriers, warehouse men, mechanics, landlords,
material men, repairmen or other like Liens arising by operation of law in the
ordinary course of business (other than Liens arising under ERISA) and
consistent with industry practices and Liens on deposits made to obtain the
release of such Liens if (i) the underlying obligations are not overdue for a
period of more than 30 days or (ii) such Liens are being contested in good faith
and by appropriate proceedings by the Company and adequate reserves with respect
thereto are maintained on the books of the Company in accordance with GAAP;
(e) Easements, rights of way, zoning and similar restrictions
and other similar encumbrances or title defects incurred in the ordinary course
of business and consistent with industry practices that, in the aggregate, are
not substantial in amount, and that do not in any case materially detract from
the value of the property subject thereto (as such property is used by the
Company or a Subsidiary) or interfere with the ordinary conduct of the business
of the Company or any of its Subsidiaries; provided that any such Liens are not
incurred in connection with any borrowing of money or any commitment to loan any
money or to extend any credit;
(f) Pledges or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance and
other types of social security legislation;
(g) Liens, incurred in connection with the Incurrence of
Refinancing Indebtedness in compliance with this Indenture with respect to
Indebtedness secured by Liens,
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provided (i) such Liens do not extend to any additional property or assets, (ii)
if the Liens securing the Indebtedness being refinanced, retired or amended by
such Refinancing Indebtedness was subordinated to or pari passu with the Liens
securing the Notes, the Subsidiary Guarantee or any Permitted Intercompany Loan,
as applicable, such new Liens are subordinated to or pari passu with such Liens
to the same extent, and any related subordination or intercreditor agreement is
confirmed, and (iii) such Liens are no more adverse to the interests of Holders
than the Liens replaced or extended thereby;
(h) Such Liens and items described in paragraph (e) above in
existence and outstanding on the Issue Date as are disclosed in the policies of
title insurance issued on or about the Issue Date;
(i) Liens that secure Indebtedness of any Person existing at
the time such Person becomes a Subsidiary of the Company or is merged or
consolidated into or with the Company or a Subsidiary of the Company, provided
that such Liens do not extend to or cover any other property or assets and were
not put in place in anticipation of such acquisition;
(j) Liens in favor of the Collateral Agent (including, in the
case of Liens securing Permitted Intercompany Loans, as collateral agent for the
Company) under the Collateral Documents;
(k) Liens in favor of the Company or any Subsidiary
Guarantor, which are assigned to the Trustee as Collateral;
(l) Liens of the Company or its Restricted Subsidiaries
in existence on the Issue Date and set forth on Schedule 101B;
(m) with respect to any vessel included in the Collateral,
maritime Liens for crew's wages, general average, salvage and damages arising
out of maritime torts permitted to exist pursuant to Section 4.6 of the related
Ship Mortgage;
(n) Liens that secure Pari Passu Indebtedness or Subordinated
Indebtedness, other than Non-Recourse Indebtedness, (a) permitted to be Incurred
under clauses (d), (e), (f) (if to refinance Existing Indebtedness of FRI) and
(h) of Section 1012 (or constituting Refinancing Indebtedness with respect to
such Indebtedness), which Liens may cover the assets financed with such
Indebtedness as well as other Collateral;
(o) Liens that secure Non-Recourse Indebtedness permitted to
be Incurred pursuant to clauses (d), (e) and (h) of Section 1012 (or
constituting Refinancing Indebtedness with respect to such Indebtedness), which
Liens under shall attach only to the assets of the Restricted Subsidiary
Incurring such Indebtedness;
(p) Liens that secure Permitted FF&E Financing permitted to be
Incurred under clause (c) of Section 1012, which Liens shall not attach to any
assets other than the assets financed thereby; and
(q) Liens granted to the Trustee or Collateral Agent to
secure the Priority Note Obligations.
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"RESTRICTED PAYMENT" means, with respect to any Person,
(a) the declaration or payment of any dividend or other
distribution in respect of Equity Interests of such Person (including the
Preferred Stock) or any Subsidiary of such Person (other than dividends or
distributions payable in Equity Interests (other than Disqualified Capital
Stock) of the Company, dividends or distributions payable to the Company or any
Wholly Owned Subsidiary of the Company that is a Subsidiary Guarantor, and pro
rata dividends or distributions payable to a minority stockholder of a
Subsidiary of the Company);
(b) any payment on account of the purchase, redemption or
other acquisition or retirement for value of Equity Interests of such Person or
any Subsidiary of such Person other than any such Equity Interests owned by the
Company or any Subsidiary Guarantor, and other than a redemption of the
Preferred Stock required as a result of an order of any Gaming Authority
(provided no Default or Event of Default then exists);
(c) any purchase, redemption, or other acquisition or
retirement for value of, any payment in respect of any amendment of the terms of
or any defeasance of, any Subordinated Indebtedness or Senior Indebtedness
(unless Notes are purchased, redeemed or otherwise acquired or retired for value
on a pro rata basis with such Senior Indebtedness and except for (i) any such
purchase, redemption, acquisition, retirement or payment of Priority Note
Obligations, (ii) any Refinancing of such Senior Indebtedness (other than the
Priority Notes) with Refinancing Indebtedness and (iii) the reduction of amounts
outstanding under revolving lines of credit), directly or indirectly, by such
Person or a Restricted Subsidiary of such Person prior to the scheduled
maturity, any scheduled repayment of principal, or scheduled sinking fund
payment, as the case may be, of such Indebtedness; and
(d) any Restricted Investment by such Person.
3. SECTION 201 IS HEREBY AMENDED TO ADD A NEW PARAGRAPH AT
THE END THEREOF TO READ IN ITS ENTIRETY AS FOLLOWS:
Each Note Unit Certificate and Note Certificate issued by the
Trustee after the date of the First Supplemental Indenture and prior to
Discharge of the Priority Obligations shall include the following legend:
The principal of (and premium, if any) and interest,
including Contingent Interest, on the indebtedness
represented hereby and all other obligations
hereunder and the Subsidiary Guarantee are
subordinated as set forth in the First Supplemental
Indenture dated as of December 30, 1996.
In lieu of physical presentation of the Note Unit Certificate
or Note Certificates to the Trustee for notation of such legend, the Trustee may
instruct any depository to make the
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appropriate notation of such legend with respect to Note Unit Certificates or
Note Certificates that are held in book entry form.
4. SECTION 501 IS HEREBY AMENDED TO MODIFY PARAGRAPH (e) TO
READ IN ITS ENTIRETY AS FOLLOWS:
(e) default under any indenture, loan agreement, mortgage,
bond, promissory note or other agreement or instrument (other than any Note
Document), under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any Restricted
Subsidiary, or the payment of which is Guaranteed by the Company or any
Restricted Subsidiary, whether such Indebtedness exists on the Issue Date or is
created or Incurred thereafter, and such default is either (i) caused by a
failure to pay when due principal or interest on such Indebtedness within any
grace period applicable thereto (a "PAYMENT DEFAULT") or (ii) results in or
requires the prepayment, repurchase, redemption, or defeasance of any such
Indebtedness prior to its express maturity, or requires that the Company or any
Restricted Subsidiary offer to take any of the foregoing actions (any such
event, an "ACCELERATION") and, in each case, either (i) such Indebtedness
consists of Priority Note Obligations or (ii) the principal amount of such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or with respect to which there has
been an Acceleration, aggregates $5,000,000 or more; or
5. SECTION 503 IS HEREBY AMENDED TO ADD A NEW PARAGRAPH AT
THE END THEREOF TO READ IN ITS ENTIRETY AS FOLLOWS:
Subject to the provisions of Article Six, prior to Discharge
of the Priority Obligations, the Trustee shall foreclose on the Collateral and
otherwise enforce its Liens on the Collateral, or direct the Collateral Agent to
foreclose upon the Collateral and enforce its Liens on the Collateral, in
accordance with any instructions given by Holders of a majority in principal
amount of Outstanding Notes, by Act of such Holders delivered to the Company and
the Trustee; provided, however, that if the Trustee receives written notice
purporting to be signed by the holders of a majority in principal amount of
outstanding Priority Notes (which notice shall state the outstanding principal
amount of the Priority Notes and the outstanding principal amount of the
Priority Notes held by the signers of such notice and shall contain an express
representation that the signers are holders of Priority Notes and are authorized
to give such notice), stating that the Priority Notes are due and payable in
full (whether at maturity, by acceleration or otherwise) and have not been paid
in full and that such holders direct the Trustee to foreclose upon or enforce
the Liens upon the Priority Notes Collateral, then the Trustee shall commence
and prosecute such foreclosure and enforcement, or direct the Collateral Agent
to do so. In commencing such foreclosure and enforcement, the Trustee may act in
accordance with instructions given by Holders of a majority in principal amount
of Outstanding Notes, by act of such Holders delivered to the Trustee and
neither the Trustee nor Collateral Agent shall have any liability whatsoever to
the holders of the Priority Notes as a result of any action in accordance with
instructions given by Holders of a majority in principal amount of the
Outstanding Notes; provided, however, that neither the Trustee nor the
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<PAGE> 11
Collateral Agent shall be entitled to rely on, and shall not be bound by,
instructions from the Holders of a majority in principal amount of the
Outstanding Notes which direct the Trustee or the Collateral Agent to terminate
any foreclosure or other enforcement proceeding or which would unreasonably
delay the prosecution thereof. The Trustee or Collateral Agent shall be under no
obligation to take any action or to exercise any remedies hereunder unless the
Holders of the Outstanding Notes or the holders of the Priority Notes shall have
provided the Trustee or Collateral Agent written instructions and
indemnification to the satisfaction of the Trustee or Collateral Agent for fees,
expenses, counsel fees and any liabilities which they may incur. All proceeds of
such foreclosure and enforcement shall be applied in the order of priority set
forth in Section 506.
6. SECTION 506 IS HEREBY AMENDED TO MODIFY CLAUSE "THIRD"
THEREOF TO READ IN ITS ENTIRETY AS FOLLOWS:
THIRD: To the payment, first and on a priority basis, of all
Priority Note Obligations and Senior Claims and, second, after Discharge of the
Priority Obligations, to the payment of the amounts then due and unpaid upon the
Notes for principal (and premium, if any) and interest, in respect of which or
for the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts due and payable on
such Notes for principal (and premium, if any) and interest;
7. SECTION 512 IS HEREBY AMENDED TO ADD A NEW CLAUSE (c) TO
READ IN ITS ENTIRETY AS FOLLOWS (AND TO MOVE THE WORD "and" FROM THE END OF
CLAUSE (a) TO THE END OF CLAUSE (b)):
(c) The Trustee shall foreclose upon and enforce the Priority
Notes Collateral as provided in the last paragraph of Section 503.
8. SECTION 902 IS HEREBY AMENDED TO ADD A NEW CLAUSE (iii) AT
THE END OF PARAGRAPH (a) TO READ IN ITS ENTIRETY AS FOLLOWS (AND TO MOVE THE
WORD "and" FROM THE END OF SUBCLAUSE (F) OF CLAUSE (i) OF PARAGRAPH (a) TO THE
END OF CLAUSE (ii) OF PARAGRAPH (a)):
(iii) until Discharge of the Priority Obligations, no such
supplemental indenture shall, without the written consent of the holders of at
least 66 2/3% in principal amount of outstanding Priority Notes (pursuant to a
written agreement executed and delivered by them, and all such written
agreements shall be binding upon and may be enforced against all other holders
of Senior Claims, without any requirement that such other holders receive notice
thereof or give consent thereto), amend, qualify, negate, discharge or limit the
effect of any of the amendments to this Indenture made pursuant to the First
Supplemental Indenture (other than those set forth in paragraph (b) of Section
1702) or any Lien securing Priority Note Obligations.
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<PAGE> 12
9. SECTION 1012 IS HEREBY AMENDED TO MODIFY CLAUSE (h) AND
TO ADD CLAUSE (i) TO READ IN THEIR ENTIRETIES AS FOLLOWS:
(h) The Company may Incur Pari Passu Indebtedness or
Subordinated Indebtedness (and the Subsidiary Guarantors may Incur Pari Passu
Indebtedness or Subordinated Indebtedness in the form of Guarantees of such Pari
Passu Indebtedness or Subordinated Indebtedness of the Company, as applicable)
and any Subsidiary Guarantor may Incur Non-Recourse Indebtedness, in an
aggregate amount for all such Indebtedness (including any related Refinancing
Indebtedness) at any time outstanding not to exceed $20,000,000, less the
principal amount (or, if less, the accreted value) of Priority Notes then
outstanding.
(i) The Company and the Restricted Subsidiaries may Incur the
Priority Note Obligations.
10. SECTION 1014 IS HEREBY AMENDED TO MODIFY CLAUSES (a), (e)
AND (h) AND TO ADD A NEW CLAUSE (i) TO READ IN THEIR ENTIRETIES AS FOLLOWS:
(a) restrictions imposed by the Note Documents, the Priority
Note Agreement, the Priority Notes or the Priority Notes Collateral Documents.
* * *
(e) any such contractual encumbrance imposed by or in
connection with the Incurrence of any Permitted FF&E Financing or working
capital Indebtedness permitted pursuant to clause (c) of Section 1012, provided
such encumbrance does not have the effect of restricting the payment of
dividends to the Company or any Restricted Subsidiary or the payment of
Indebtedness owed to the Company or any Subsidiary Guarantor or reducing the
amount of any such dividends or payments,
* * *
(h) subject only to the consent of the Holders of a majority
in principal amount of the Outstanding Notes, any such contractual encumbrances
imposed on Main Street in connection with the acquisition thereof with Permitted
Black Hawk Indebtedness in the form of Non-Recourse Indebtedness, and
(i) replacements of restrictions imposed pursuant to clauses
(a) through (h) that are no more restrictive than those being replaced.
11. SECTION 1016 IS HEREBY AMENDED TO MODIFY SUBCLAUSE (A) OF
PARAGRAPH (a) TO READ IN ITS ENTIRETY AS FOLLOWS:
(A) within 210 days after the date of the Asset Sale (the
"REINVESTMENT PERIOD"), the Net Cash Proceeds therefrom are either (1)
reinvested in assets or property directly related to a Related Business of the
Company or such Restricted Subsidiary (or the
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<PAGE> 13
Company or such Restricted Subsidiary shall have entered into a binding
obligation to make such an investment), (2) applied to pay Priority Note
Obligations, or (3) in accordance with the procedures set forth in this Section
1016 and Section 1110, applied, pursuant to an offer (a "ASSET SALE PURCHASE
OFFER") to purchase from the Holders, to the repurchase for cash from Holders
accepting such Asset Sale Purchase Offer, of the maximum principal amount of
Notes that may be purchased out of that portion, if any, of the Net Cash
Proceeds of such Asset Sale that is not reinvested pursuant to clause (1) or
applied pursuant to clause (2) within the Reinvestment Period ("EXCESS
PROCEEDS"), at a purchase price of 100% of principal amount, plus accrued
interest to the Purchase Date (the "ASSET SALE PURCHASE PRICE"),
12. SECTION 1017 IS HEREBY AMENDED TO MODIFY PARAGRAPH (b) TO
READ IN ITS ENTIRETY AS FOLLOWS:
(b) Notwithstanding the foregoing, (i) no Liens referred to in
clauses (n) through (o) of the definition of Permitted Liens may attach to any
Excluded Assets (other than Liens granted on Fitzgeralds Black Hawk and the
other assets of Main Street in connection with the incurrence of Permitted Black
Hawk Indebtedness which is Non-Recourse Indebtedness), and (ii) no Lien referred
to in clauses (n) through (p) of the definition of Permitted Lien may attach to
any assets of FNYI or FAMI. Without limitation of the other provisions of the
Note Documents, this subsection (b) shall apply to the assets referred to in
this subsection notwithstanding any transfer thereof to any other Restricted
Subsidiary or the Company after the Issue Date.
13. SECTION 1020 IS HEREBY AMENDED TO MODIFY SUBCLAUSES (A),
(B) AND (E) OF CLAUSE (iii) OF PARAGRAPH (a) TO READ IN THEIR ENTIRETIES AS
FOLLOWS:
(A) in the case of the Company, an Accounts Pledge Agreement
securing the Secured Obligations of the Company and, until Discharge of the
Priority Obligations, the Priority Note Obligations with a first priority Lien
in the Asset Sale Account, the Net Cash Proceeds deposited therein, and all
proceeds thereof (including all Cash Equivalents in which such Net Cash Proceeds
or proceeds may from time to time be invested (collectively, the "ASSET SALE
ACCOUNT COLLATERAL");
(B) in the case of a Subsidiary Guarantor, (1) an Accounts
Pledge Agreement securing the Subsidiary Guarantee of and all Permitted
Intercompany Loans from time to time made to such Person and, until Discharge of
the Priority Obligations, the Priority Note Obligations with priority Liens in
the Asset Sale Account Collateral, and (2) an amendment to Schedule B-2 of the
Company Pledge Agreement and the related financing statements, adding the
Accounts Pledge Agreement referred to in (1) to the Collateral listed therein;
* * *
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<PAGE> 14
(E) an Opinion of Counsel to the effect that (1) each Accounts
Pledge Agreement and other Collateral Document required by this Section 1020(a)
is the legal, valid and binding obligation of the Note Party thereto and creates
a perfected security interest in the Collateral thereunder, as security for the
Secured Obligations, any Permitted Intercompany Loans or Permitted Intercompany
Notes and, until Discharge of the Priority Obligations, the Priority Note
Obligations, in the order of priority set forth in Section 1202(b), and (2) the
Company has taken all steps required to be taken under Sections 1016(c) and
1202(c) and this Section 1020(a).
14. SECTION 1020 IS HEREBY FURTHER AMENDED TO MODIFY SUBCLAUSE
(A) OF CLAUSE (ii) OF PARAGRAPH (c) TO READ IN ITS ENTIRETY AS FOLLOWS:
(A) such amendments to the Subsidiary Security Agreement or
Subsidiary Pledge Agreement and such Subsidiary Mortgages, Subsidiary Ship
Mortgages, financing statements, notices of security interest, assignments or
other Collateral Documents executed by such Subsidiary, as may be reasonably
required to create first priority and second priority Liens in favor of the
Collateral Agent on behalf of the Beneficiaries and the Company, respectively,
on all Additional Collateral, securing the Secured Obligations of such
Subsidiary under the Subsidiary Guarantee (if any), the Permitted Intercompany
Loans and, until Discharge of the Priority Obligations, the Priority Note
Obligations;
15. SECTION 1020 IS HEREBY FURTHER AMENDED TO MODIFY SUBCLAUSE
(A) OF CLAUSE (ii) OF PARAGRAPH (d) TO READ IN ITS ENTIRELY AS FOLLOWS:
(A) such amendments to existing Collateral Documents and
additional Mortgages, Ship Mortgages or other Collateral Documents, executed by
the Company, as may be reasonably required to create first priority Liens in
favor of the Collateral Agent on behalf of the Beneficiaries on all Additional
Collateral, securing the Secured Obligations of the Company and, until Discharge
of the Priority Obligations, the Priority Note Obligations;
16. SECTION 1201 IS HEREBY AMENDED TO ADD A NEW PARAGRAPH
(d) TO READ IN ITS ENTIRETY AS FOLLOWS:
(d) Until Discharge of the Priority Obligations, the Trustee
shall act as Collateral Agent for the holders of Priority Note Obligations, as
well as for the Beneficiaries, and in such capacity shall (i) enter into and
accept the Priority Notes Collateral Documents, (ii) accept or enter into any
additional Collateral Documents which the Company or any Restricted Subsidiary
may be required to deliver only if such Collateral Documents state that, until
Discharge of the Priority Obligations, the Priority Note Obligations shall be
secured thereby and the Collateral Agent shall hold the Priority Notes
Collateral both for the holders of the Priority Notes and other Priority Note
Obligations and for the Beneficiaries, and (iii) hold and enforce the Liens
created by the Priority Notes Collateral Documents for the benefit of both
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<PAGE> 15
the holders of the Priority Notes and other Priority Note Obligations and the
Beneficiaries, subject to the provisions of this Indenture.
17. SECTION 1202 IS HEREBY AMENDED TO MODIFY PARAGRAPHS (a),
(b) AND (d) TO READ IN THEIR ENTIRETIES AS FOLLOWS:
(a) The Company shall furnish to the Trustee:
(i) 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 Collateral Documents necessary to make
effective or perfect the Lien have been taken, reciting such actions;
(ii) On or prior to each anniversary of the date
hereof, an Opinion of Counsel, dated as of such date, either (A)
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 Collateral Documents, or financing
statements, continuation statements or other instruments of further
assurance, as is necessary to maintain the Liens of the Collateral
Documents to the extent required hereby, until the next such
anniversary, and reciting the details of such action, or (B) stating
that, in the opinion of such counsel, no such action is necessary to
maintain such Liens; and
(iii) As soon as practicable, and in any event prior
to January 31, 1997, an Opinion of Counsel stating that, in the opinion
of such counsel, all amendments and modifications to the Collateral
Documents, and all recordings, filings and other actions necessary to
make effective or perfect the Lien on the Collateral in favor of the
holders of the Priority Obligations have been taken, reciting such
amendments, modifications and actions.
(b) Notwithstanding any provision to the contrary in this
Indenture or any of the Collateral Documents, until Discharge of the Priority
Obligations, (i) all Liens held by the Trustee or Collateral Agent as security
both for Priority Note Obligations and for Secured Obligations shall secure
Priority Note Obligations in preference and priority over Secured Obligations,
(ii) all Liens held by the Trustee or Collateral Agent upon any property of any
Subsidiary Guarantor as security for Priority Note Obligations and also as
security for Permitted Intercompany Notes or Permitted Intercompany Loans and
for the Subsidiary Guarantee and other Secured Obligations shall secure, in
order of preference and priority, first, the Priority Note Obligations, second,
such Permitted Intercompany Notes and Permitted Intercompany Loans, and third,
the Subsidiary Guarantee and such other Secured Obligations, and (iii) all
proceeds received by the Collateral Agent under any policy of casualty insurance
or title insurance covering any Collateral shall be applied in the order of
priority set forth in clause (ii) herein.
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<PAGE> 16
The Company, Subsidiary Guarantors, Trustee and Holders
acknowledge and agree that the purpose and intent of the foregoing provision is
that, until Discharge of the Priority Obligations:
(i) All Liens held by the Trustee or Collateral Agent
pursuant to the Collateral Documents shall secure the Priority Note Obligations,
and, to the extent a grant of such security may be required under the laws of
any jurisdiction in which any Collateral is located, the Company and the
Subsidiary Guarantors hereby grant to the Trustee, as Collateral Agent, a
security interest in and Lien upon all of the Collateral as security for the
payment when due of each and all of the Priority Note Obligations upon the terms
and conditions set forth in the Collateral Documents;
(ii) All Liens held by the Trustee or Collateral Agent as
security for Priority Note Obligations shall secure the Priority Note
Obligations in preference and priority over the Notes, the Subsidiary Guarantees
and all other Secured Obligations;
(iii) All Liens granted by any Subsidiary Guarantor pursuant
to the Collateral Documents upon any property of such Subsidiary Guarantor,
whether real, personal or mixed, as security both for Permitted Intercompany
Loans or Permitted Intercompany Notes and as security for a Subsidiary Guarantee
or other Secured Obligations shall be (and hereby are) reprioritized so that
such Liens shall be (and are hereby declared and agreed to be) first, prior and
senior Liens insofar as they secure such Permitted Intercompany Loans or
Permitted Intercompany Notes and junior Liens (subject only to the provisions of
clause (ii) above and to such first, prior and senior Liens) insofar as they
secure such Subsidiary Guarantee and other Secured Obligations; and
(iv) The Trustee or Collateral Agent shall hold and be
entitled to enforce all such Permitted Intercompany Loans and Permitted
Intercompany Notes, as secured by such reprioritized first, prior and senior
Liens, as part of the Priority Notes Collateral and as first and prior
collateral security for the Priority Note Obligations.
The Company, Subsidiary Guarantors and Trustee agree to
execute and deliver (if required, in duly attested and recordable form) any and
all amendments and supplements to the Collateral Documents that may reasonably
be requested by any holder of Priority Notes in order to further assure that the
foregoing purpose and intent are reflected in any instrument or agreement that
may be required or appropriate under the laws of any jurisdiction in which any
Collateral is located or to reflect the agreements herein set forth in a
document filed for public record or otherwise to perfect and prioritize any Lien
held by the Trustee or Collateral Agent as security for Priority Note
Obligations.
Subject to the foregoing and except as otherwise expressly
provided herein and the other Note Documents, at all times while any Notes
remain Outstanding, (i) the Secured Obligations of the Company are required to
be secured by a first priority, perfected Lien on all of the following (not
including Excluded Assets):
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<PAGE> 17
(A) the Company's Equity Interests in all
present and future Restricted Subsidiaries held by the Company, substantially on
the terms set forth in and contemplated by the Company Pledge Agreement;
(B) all existing and later created Permitted
Intercompany Loan Collateral, substantially on the terms set forth in and
contemplated by the Company Pledge Agreement;
(C) the Note Proceeds Account Collateral,
substantially on the terms set forth in and contemplated by the Company Accounts
Pledge Agreement;
(D) under the circumstances described in Section
1020(a) with respect to the Company, all Asset Sale Account Collateral,
substantially on the terms set forth in and contemplated by the Company Accounts
Pledge Agreement; and
(E) substantially all of the Company's present
and future assets not referred to in (A), (B), (C) or (D), including real estate
(including leasehold properties), fixtures and personal property, substantially
on the terms set forth in and contemplated by the Company Security Agreement, a
Mortgage, a Ship Mortgage or other relevant Collateral Documents covering
Collateral of the same type.
(ii) The Subsidiary Guarantee of each Subsidiary Guarantor
shall be secured by first priority perfected Liens on all of the following (not
including Excluded Assets):
(A) all Equity Interests in other present and
future Restricted Subsidiaries held by such Subsidiary Guarantor, substantially
on the terms set forth in and contemplated by the Subsidiary Pledge Agreement;
(B) in the case of PLEC and each other
Subsidiary Guarantor that may from time to time acquire a vessel eligible for
registration with the US Coast Guard, the Fitzgeralds Tunica Gaming Vessel or
such other vessel, as the case may be, substantially on the terms set forth in
and contemplated by the PLEC Ship Mortgage or any other Subsidiary Ship
Mortgage;
(C) under the circumstances described in Section
1020(a) with respect to such Subsidiary Guarantor, all Asset Sale Account
Collateral, substantially on the terms set forth in and contemplated by an
Accounts Pledge Agreement; and
(D) substantially all present and future assets
of such Subsidiary not referred to in (A), (B) or (C), including real estate
(including leasehold properties), fixtures and personal property, in each case
substantially on the terms set forth in and contemplated by the Subsidiary
Security Agreement, a Subsidiary Mortgage or other relevant Collateral Documents
covering Collateral of the same type.
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<PAGE> 18
(iii) All Permitted Intercompany Loans to present and future
Restricted Subsidiaries shall be secured by first (or, in the case of Permitted
Intercompany Loans to any Subsidiary Guarantor, second) priority perfected Liens
on substantially all assets of such Restricted Subsidiaries, other than Excluded
Assets, in each case substantially on the terms set forth in and contemplated by
the relevant Collateral Documents referred to in Section 1202(b)(ii).
Without limitation, if any assets of Fitzgeralds Las Vegas or
Fitzgeralds Reno cease to constitute Excluded Assets at any time, the Company or
the relevant Restricted Subsidiary shall take such steps are may be required to
grant the Liens contemplated by clauses (ii) and (ii) of this subsection (b) in
accordance with subsection (d) below.
Notwithstanding the foregoing, (i) neither the Company nor any
Restricted Subsidiary shall be required to grant a Lien, as security for
Priority Note Obligations, upon the capital stock of any Subsidiary of the
Company which holds, or which owns a Subsidiary which holds, a Gaming License
issued by a Gaming Authority in the State of Nevada or in the State of
Mississippi, unless and until all such Gaming Authorities in such State have
approved the grant of a Lien upon such capital stock as security for Priority
Note Obligations, (ii) any provision of this Section 1202(b) or any Priority
Notes Collateral Documents pursuant to which Priority Note Obligations would
(but for this clause (ii)) become secured by any such capital stock shall become
effective only if and when such approval is granted, and (iii) such provision
shall become effective, automatically, unconditionally and irrevocably and
without necessity for any further act or deed, immediately when such approval is
granted in such State. The Company will file appropriate applications for all
such approvals no later than January 10, 1997, will diligently prosecute such
applications and will use its best efforts to obtain such approvals in
accordance with gaming laws and practice and as promptly as practicable.
* * *
(d) If, at any time after the Issue Date, pursuant to
subsection (b) of this Section 1202 or otherwise, Liens are required to be
created on (i) assets acquired after the Issue Date (including assets acquired
in connection with an Asset Sale), (ii) assets that previously constituted
Excluded Assets, (iii) assets or Capital Stock of a Person that was not
previously a Restricted Subsidiary or Significant Restricted Subsidiary or that
did not have outstanding any Permitted Affiliate Loans, or (iv) any other assets
not previously subject to a Lien securing the Secured Obligations and, until
Discharge of the Priority Obligations, the Priority Note Obligations, the
relevant Note Party shall take all necessary steps toward the creation of such
Liens within 10 days after the acquisition of such assets or the date on which
such assets first ceased to constitute Excluded Assets or such Person first
constituted a Restricted Subsidiary or Significant Restricted Subsidiary or
first incurred such Permitted Affiliate Loan, or the date on which such Liens
are first required to exist hereunder, as applicable. With respect to assets
referred to in clause (iv)(B) of the definition of "Excluded Assets" over which
a lien may be granted in favor of the Collateral Agent, if requested by the
Company and upon receipt of an Officer's Certificate from the Company certifying
that no Default or Event of Default has occurred and is continuing, the
Collateral Agent will execute
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<PAGE> 19
and deliver to the lender under the Permitted FF&E Financing or Non-Recourse
Indebtedness, as the case may be, a subordination agreement, in form and
substance satisfactory to the Collateral Agent, subordinating the lien in favor
of the Collateral Agent in such assets, in order of priority, to the lien in
favor of such lender.
18. SECTION 1203 IS HEREBY AMENDED TO MODIFY THE FIRST
PARAGRAPH TO READ IN ITS ENTIRETY AS FOLLOWS:
The Company and the Collateral Agent may amend any Collateral
Document, and the Company and such of the Trustee and Collateral Agent as may be
a party thereto may amend any other Note Document (other than this Indenture and
the Notes), without notice to or the consent of any Holder or any holder of
Priority Notes.
19. SECTION 1204 IS HEREBY AMENDED TO MODIFY PARAGRAPH (a) TO
READ IN ITS ENTIRETY AS FOLLOWS:
(a) Except as otherewise provided in Section 902 or in the
other Note Documents, with the written consent of Holders of at least a majority
in principal amount of the Outstanding Notes, by Act of the Holders delivered to
the Trustee (but without notice to or the consent of any holders of Priority
Notes, except as provided in Section 902), any Note Party may enter into, when
authorized by a Board Resolution, and the Trustee and Collateral Agent may enter
into or consent to, any amendment of any Collateral Document or other Note
Document (other than this Indenture and the Notes), without further notice to
any Holder.
20. SECTION 1207 IS HEREBY AMENDED TO MODIFY PARAGRAPH (a) TO
READ IN ITS ENTIRETY AS FOLLOWS:
(a) If (i) each Obligor 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 Four or Fourteen hereof or (ii) all Outstanding Notes issued under this
Indenture shall have been surrendered to the Trustee for cancellation, and if
the Trustee receives evidence reasonably satisfactory to it that there has been
a Discharge of the Priority Obligations and that all Secured Obligations have
been paid in full, the Collateral Agent shall no longer be deemed to hold the
Lien in the Collateral for the benefit of the Beneficiaries and the holders of
Priority Notes.
21. SECTION 1208 IS HEREBY AMENDED TO MODIFY CLAUSE (ii)
OF PARAGRAPH (a) TO READ IN ITS ENTIRETY AS FOLLOWS:
(ii) take all steps the Collateral Agent is entitled to take
under the relevant Collateral Documents for the protection of the Collateral or
its priority (including by discharging or paying Liens and claims the Collateral
Agent is entitled to discharge or pay from funds available to the Collateral
Agent therefor), provided the Collateral Agent 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
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<PAGE> 20
1202(a), pursuant to any requirement of the Collateral Documents to give such
notice, or otherwise.
22. SECTION 1309 IS HEREBY AMENDED TO ADD A NEW PARAGRAPH AT
THE END THEREOF TO READ IN ITS ENTIRETY AS FOLLOWS:
Notwithstanding anything contained herein to the contrary, in
the event that a Subsidiary Guarantor acquires Main Street pursuant to the Main
Street Option Agreement with Permitted Black Hawk Indebtedness in the form of
Non-Recourse Indebtedness (for which only Main Street is liable), the Subsidiary
Guarantee of Main Street shall provide that it will not become enforceable
unless and until the lender of such Permitted Black Hawk Indebtedness exercises
any remedy available to it under the agreements governing such Permitted Black
Hawk Indebtedness for the acceleration or collection of such Permitted Black
Hawk Indebtedness or for the foreclosure or any other enforcement of any Lien
governing such Permitted Black Hawk Indebtedness.
23. A NEW ARTICLE SIXTEEN IS HEREBY ADDED TO READ IN ITS
ENTIRETY AS FOLLOWS:
ARTICLE SIXTEEN
SUBORDINATION OF NOTES TO PRIORITY NOTES
SECTION 1601. SUBORDINATION.
The Company, each Subsidiary Guarantor and each Holder hereby
covenant and agree, for the benefit of each present and future holder of any
Senior Claims, that the Subordinated Claims are and shall be postponed,
subordinated and junior in right of payment to the prior payment in full of all
Senior Claims, on the terms and conditions set forth in this Article Sixteen.
SECTION 1602. PAYMENT.
Until Discharge of the Priority Obligations, the Company and
its Restricted Subsidiaries shall not make, and the Holders of the Notes will
not demand, accept, receive or retain, any payment or distribution of any kind
or character, whether in cash, property, securities or otherwise, on account or
in respect of any Subordinated Claim, PROVIDED, HOWEVER, that
(a) interest (including Contingent Interest) on the
Notes may be paid on or after the date payment thereof is due, if no
payment of principal or interest on the Priority Notes is then past
due,
(b) the Company may make and perform an Asset Sale
Purchase Offer from Excess Proceeds pursuant to Section 1016, but only
(i) to the extent the holders of the Priority Notes have declined to
accept an offer by the Company to apply
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<PAGE> 21
the Net Cash Proceeds from which such Excess Proceeds were derived
first to the payment of the Priority Notes (with premium, if any) and
(ii) if no Bankruptcy, Insolvency or Liquidation Proceeding is then
pending, and
(c) the Company may make and perform a Change of
Control Purchase Offer pursuant to Section 1109, but only (i) to the
extent that the holders of the Priority Notes have declined to accept
an offer by the Company to repurchase or retire the Priority Notes in
full (with premium, if any) and (ii) if not Bankruptcy, Insolvency or
Liquidation Proceeding is then pending.
SECTION 1603. BANKRUPTCY, INSOLVENCY OR LIQUIDATION PROCEEDINGS.
(a) In the event of any Bankruptcy, Insolvency or
Liquidation Proceeding:
(i) all Senior Claims shall be paid in full in cash
before any holder of Subordinated Claims shall be entitled to receive
any payment or distribution of any kind or character, whether in cash,
property, securities or otherwise, in such Bankruptcy, Insolvency or
Liquidation Proceeding on account or in respect of any Subordinated
Claim;
(ii) the holders of Senior Claims shall be entitled
to receive any and all payments and distributions of every kind or
character, whether in cash, property, securities or otherwise
(including, without limitation, any such payment or distribution which
may become payable or deliverable by reason of the payment of any other
claim against the Company or any Subsidiary Guarantor being
subordinated to the payment of any Subordinated Claim), that may become
payable or deliverable on account or in respect of any Subordinated
Claim, for application to the payment of all Senior Claims, until the
holders of Senior Claims have received payment of all Senior Claims in
full and in cash; and
(iii) all such payments and distributions on account
or in respect of Subordinated Claims shall be delivered by the debtor,
trustee, receiver, disbursing agent or other person making such payment
or distribution in such Bankruptcy, Insolvency or Liquidation
Proceeding directly to the holders of Senior Claims. If such payment or
distribution consists of any property or securities other than cash,
(i) such payment or distribution shall not be deemed applied to the
payment of Senior Claims at any adjudicated or imputed value and (ii)
such payment or distribution and all other and future non-cash payments
and distributions on account or in respect of Subordinated Claims shall
be delivered to and held by the holders of Senior Claims, until cash
proceeds from such non-cash payments and distributions have been
received by the holders of Senior Claims in an amount sufficient (with
any other cash paid or distributed to them by or on behalf of the
Company or any Subsidiary Guarantor) to pay, in full and in cash, all
Senior Claims (including, without limitation, all Disallowed
Post-Petition Interest/Expense Claims accrued or arising through the
date on which cash proceeds in such amount are received).
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<PAGE> 22
(b) If the holder of any Subordinated Claim fails to file a
proof of claim or other statement or demand in respect of such Subordinated
Claim in a Bankruptcy, Insolvency or Liquidation Proceeding prior to the 30th
day preceding any bar date or other deadline for filing a proof of claim or
other such statement or demand therein, or if any such proof of claim, statement
or demand filed by such holder prior to such day is in any respect inadequate or
insufficient (in the good faith opinion of any holder of a Senior Claim), then
each holder of a Senior Claim shall have the right, but not the obligation, to
execute and deliver (in the name of the holder of such Subordinated Claim or in
its own name but on behalf of the holder of such Subordinated Claim, as such
holder of a Senior Claim may elect) and file in such Bankruptcy, Insolvency or
Liquidation Proceeding any proof of claim, statement or demand which such holder
of a Senior Claim may determine to be required or appropriate in respect of such
Subordinated Claim.
(c) To the extent necessary or reasonably appropriate to
permit the holders of Senior Claims to exercise the right granted to them under
this Section 1603(d), each holder of Subordinated Claims hereby constitutes and
appoints each holder of a Senior Claim as its attorney-in-fact and agent, with
full power of substitution and delegation, to execute, deliver and file any such
proof of claim, statement or demand as herein provided, and the power of
attorney granted herein (being coupled with an interest) is and shall be in all
respects irrevocable.
(d) No holder of a Senior Claim shall, by executing,
delivering or filing any such proof of claim, statement or demand, become liable
or responsible in any respect for the legality, adequacy or sufficiency thereof.
(e) No holder of a Senior Claim shall have the right, as
holder of a Senior Claim or by reason of the subordination provided herein, to
vote any Subordinated Claim in any Bankruptcy, Insolvency or Liquidation
Proceeding.
SECTION 1604. TURNOVER.
If and in each instance that, notwithstanding the provisions
of Sections 1602 and 1603, the Trustee or any holder of any Subordinated Claim
receives any payment or distribution of any kind or character, whether in cash,
property, securities or otherwise (including, without limitation, any such
payment or distribution which may become payable or deliverable by reason of the
payment of any other claim against the Company or any Subsidiary Guarantor being
subordinated to the payment of any Subordinated Claim but excluding any payment
or distribution expressly permitted to be made pursuant to Section 1602), on
account or in respect of any Subordinated Claim at any time when any Senior
Claim is outstanding, then and in each such event:
(a) the Trustee or the holder of such
Subordinated Claim shall forthwith pay over, transfer and deliver such payment
or distribution to the holders of Senior
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<PAGE> 23
Claims, whether or not any Bankruptcy, Insolvency or Liquidation Proceeding is
then pending, until all Senior Claims have been paid in full in cash; and
(b) the Trustee and each holder of a
Subordinated Claim shall, and hereby agrees to, hold in trust for the holders
of Senior Claims, in the identical form received (except for any necessary
endorsement to holders of Senior Claims) and as trustee of an express trust, all
payments and distributions required to be paid over, transferred and delivered
pursuant to this Section 1604.
SECTION 1605. PROCEEDS OF COLLATERAL SUBJECT TO
SUBORDINATION.
All proceeds of Collateral that may at any time be or become
payable or deliverable to any holder of any Subordinated Claim shall be
delivered directly to the holders of Senior Claims, in the same manner and on
the same terms as any other payment or distribution on account or in respect of
any Subordinated Claim.
SECTION 1606. SUBROGATION.
In any Bankruptcy, Insolvency or Liquidation Proceeding,
subject to the prior payment in full and in cash of all Senior Claims, the
holders of Subordinated Claims shall have and may enforce any and all rights of
subrogation accorded by law in respect of any payment or distribution on account
of any Subordinated Claim that is applied to the payment of any Senior Claim
pursuant to the provisions of this Article Sixteen. For such purposes:
(a) no right of subrogation shall be available to or may
be enforced by any holder of any Subordinated Claim, unless and until there has
been a Discharge of the Priority Obligations;
(b) no holder of any Senior Claim makes any
representation or warranty, or shall otherwise have any responsibility, as to
whether any such right of subrogation is accorded or available to any holder of
any Subordinated Claim or is enforceable by it in any particular circumstance;
(c) no holder of any Senior Claim shall have any duty to
any holder of any Subordinated Claim to ensure, perfect, protect, enforce or
maintain any right, remedy, lien or interest that might otherwise be accorded or
available to or enforceable by it or by any holder of any Senior Claim or
Subordinated Claim. The subordination provided herein and the rights of the
holders of Senior Claims hereunder shall remain fully enforceable on the terms
set forth herein, regardless of any act, omission or circumstance (whether or
not attributable to any holder of any Senior Claim and whether or not wrongful)
which does or might in any manner or in any respect destroy, limit, reduce,
affect or impair any right of subrogation otherwise accorded or available to or
enforceable by any holder of any Subordinated Claim. Each holder of any Senior
Claim shall remain utterly free to take or fail to take any and all actions in
respect of any Senior Claim or any person or entity liable therefor or any
collateral security therefor (including, without limitation, each and all of the
acts, omissions and matters
-22-
<PAGE> 24
described in Section 1607), without exonerating any holder of a Subordinated
Claim, even if any right of subrogation is destroyed, limited, reduced, affected
or impaired thereby;
(d) the subordination provided herein and the rights of
the holders of Senior Claims hereunder shall be fully enforceable as to all
Senior Claims that are Disallowed Post-Petition Interest/Expense Claims, even if
and even though no right of subrogation is available in respect of such
Disallowed Post-Petition Interest/Expense Claims; and
(e) for purposes of enforcing any right of subrogation on
the terms set forth in this Section 1606, no payment or distribution on account
of any Subordinated Claim applied to the payment of a Senior Claim shall, as
between the Company and the Subsidiary Guarantors and the holder of such
Subordinated Claim and to the extent of the payment or distribution so applied,
discharge the liability of the Company or any Subsidiary Guarantor for the
payment of such Senior Claim or any Lien securing such Senior Claim and, to this
end, the Company and the Subsidiary Guarantors shall remain obligated to pay
such Senior Claim in full and all Liens securing such Senior Claim shall remain
outstanding and enforceable, notwithstanding any such application. To the extent
necessary to accomplish the foregoing, the provisions of this Section 1606(e)
and all provisions added to the Indenture by the First Supplemental Amendment
and all provisions of the Priority Notes Collateral Documents shall survive and
remain enforceable after Discharge of the Priority Obligations and any discharge
of the First Supplemental Indenture.
SECTION 1607. SUBORDINATION NOT PREJUDICED, AFFECTED OR
IMPAIRED.
(a) No right of the holders of Senior Claims to enforce
subordination as provided in this Article Sixteen shall at any time in any way
be prejudiced, affected or impaired by any act or failure to act on the part of
the Company or any Subsidiary Guarantor or by any act or failure to act on the
part of any holder of Senior Claims or by any breach or default by the Company
or any Subsidiary Guarantor in the performance or observance of any promise,
covenant or obligation enforceable by any holder of Subordinated Claims,
regardless of any knowledge thereof that any holder of Senior Claims may have or
otherwise be charged with, or by any breach or default by any holder of Senior
Claims in the performance or observance of any promise, obligation or duty
enforceable by the Company or any of its Subsidiaries.
(b) Without in any way limiting the generality of the
foregoing, each holder of Senior Claims may at any time and from time to time,
without the consent of or notice to any holder of Subordinated Claims, without
incurring any responsibility or liability to any holder of Subordinated Claims
and without in any manner prejudicing, affecting or impairing the subordination
provided herein or the obligations of the holders of Subordinated Claims under
this Article Sixteen:
(i) purchase securities of, make loans and
advances to, or otherwise extend credit to or for account of the Company or any
Restricted Subsidiary, subject to Section 1012; provided, however, that, except
for the Priority Notes, no such securities, loans,
-23-
<PAGE> 25
advances or extensions of credit shall, even if permitted under Section 1012,
constitute Senior Claims;
(ii) change the manner, place or terms of payment
or extend the maturity to no later than December 31, 1999, alter, compromise,
accelerate or modify any Senior Claim or any agreement or obligation of the
Company or any Subsidiary Guarantor or any other person or entity in any manner
related thereto;
(iii) reduce the amount of any Senior Claim or the
interest thereon;
(iv) release or discharge any Senior Claim or any
guaranty thereof or any agreement or obligation of the Company or any Subsidiary
Guarantor or any other person or entity with respect thereto;
(v) take or fail to take any collateral security
for any Senior Claim (except that Senior Claims shall only be secured pursuant
to Priority Financing Collateral Documents) or take or fail to take any action
which may be necessary or appropriate to ensure that any Lien upon any property
securing any Senior Claim is duly enforceable or perfected or entitled to
priority as against any other Lien or to ensure that any proceeds of any
property subject to any Lien are applied to the payment of any Senior Claim;
(vi) release, discharge or permit the lapse of
any or all Liens at any time securing any Senior Claim; or
(vii) direct the Trustee or Collateral Agent to
exercise or enforce, in any manner, order or sequence, or fail to direct the
Trustee or Collateral Agent as to the exercise or enforcement of, any right or
remedy against the Company or any Subsidiary Guarantor or any collateral
security or any other person, entity or property in respect of any Senior Claim
or Lien securing any Senior Claim or any right under this Article Sixteen or
take or fail to take any other action as to any Priority Notes Collateral.
(c) No exercise, delay in exercising or failure to exercise
any right arising under this Article Sixteen, no act or omission of any holder
of any Senior Claim in respect of the Company or any Subsidiary Guarantor or any
other person or entity or any collateral security for any Senior Claim or any
right arising under this Article Sixteen, no change, impairment, or suspension
of any right or remedy of any holder of any Senior Claim, and no other act,
failure to act, circumstance, occurrence or event which, but for this provision,
would or could act as a release or exoneration of the obligations of the holders
of Subordinated Claims hereunder shall in any way affect, decrease, diminish or
impair any of the obligations of any holder of Subordinated Claims under this
Article Sixteen or give any holder of Subordinated Claims or any other person or
entity any recourse or defense against any holder of Senior Claims in respect of
any right arising under this Article Sixteen.
-24-
<PAGE> 26
SECTION 1608. REDEMPTION, PURCHASE, DEFEASEANCE OR EXCHANGE.
Any redemption, purchase, defeasance or exchange of any
Subordinated Claim, whether or not required or permitted under this Indenture,
shall, for the purposes of this Article Sixteen, constitute a payment or
distribution on account of such Subordinated Claim.
Section 1609. Reinstatement.
If any payment or distribution at any time made on account or
in respect of any Senior Claim is thereafter rescinded, recovered, set aside,
avoided or required to be returned, then such Senior Claim and all rights of the
holder of such Senior Claim to enforce subordination as set forth herein and all
Liens securing Priority Note Obligations shall be automatically and
unconditionally reinstated, as fully as if such payment or distribution had
never been made. To the extent necessary to accomplish the foregoing, the
provisions of this Article Sixteen and all Liens securing Priority Note
Obligations shall survive and remain enforceable after Discharge of the Priority
Obligations and discharge of the First Supplemental Indenture.
24. A NEW ARTICLE SEVENTEEN IS HEREBY ADDED TO
READ IN ITS ENTIRETY AS FOLLOWS:
ARTICLE SEVENTEEN
MODIFICATION AND DISCHARGE
OF
THE FIRST SUPPLEMENTAL INDENTURE
SECTION 1701. ENFORCEABLE BY PRIORITY HOLDERS; ACCEPTANCE;
RELIANCE.
Each and all of the amendments made to this Indenture by the
First Supplemental Indenture and each and all of the Priority Notes Collateral
Documents and the benefit of the Liens securing Priority Note Obligations
created thereby are intended to inure directly to the benefit of each present
and future holder of Priority Note Obligations or Senior Claims and may be
enforced by them in any lawful manner. Notice of acceptance thereof by any such
holder is hereby waived. Reliance thereon by each such holder shall be
conclusively presumed.
SECTION 1702. DISCHARGE OF THE FIRST SUPPLEMENTAL INDENTURE
AND PRIORITY LIENS.
(a) Subject only to Sections 1606(e) and 1609 and to paragraph
(b) of this Section 1702, the amendments made to this Indenture by the First
Supplemental Indenture and, to the extent they secure Priority Note Obligations,
all Liens securing Priority Note Obligations shall be discharged upon Discharge
of the Priority Obligations.
-25-
<PAGE> 27
(b) The following amendments made to this Indenture by the
First Supplemental Indenture shall survive Discharge of the Priority
Obligations:
(i) the addition of the defined term
"Fitzgeralds Black Hawk" to Section 101;
(ii) the amendment of the defined term "Excluded
Assets" and "Permitted Black Hawk
Indebtedness" in Section 101;
(iii) the amendment of clause (h) and addition of
clause (i) to Section 1014;
(iv) the amendment of paragraph (b) of Section
1017;
(v) the amendment of Section 1309 to add a new
paragraph thereto; and
(vi) this paragraph (b) of Section 1702.
25. FOR ALL PURPOSES OF THIS FIRST SUPPLEMENTAL INDENTURE, EXCEPT
AS OTHERWISE HEREIN EXPRESSLY PROVIDED OR UNLESS THE CONTEXT OTHERWISE REQUIRES,
THE TERMS AND EXPRESSIONS USED HEREIN SHALL HAVE THE SAME MEANINGS AS
CORRESPONDING TERMS AND EXPRESSIONS USED IN THE INDENTURE.
26. EXCEPT AS HEREBY EXPRESSLY AMENDED, THE INDENTURE AND THE
NOTES ISSUED THEREUNDER ARE IN ALL RESPECTS RATIFIED AND CONFIRMED AND ALL
TERMS, CONDITIONS AND PROVISIONS THEREOF SHALL REMAIN IN FULL FORCE AND EFFECT.
27. THIS FIRST SUPPLEMENTAL INDENTURE SHALL FORM A PART OF THE
INDENTURE FOR ALL PURPOSES, AND EVERY HOLDER OF NOTES HERETOFORE OR HEREAFTER
AUTHENTICATED AND DELIVERED SHALL BE BOUND HEREBY.
28. THIS FIRST SUPPLEMENTAL INDENTURE MAY BE EXECUTED IN ANY
NUMBER OF COUNTERPARTS, EACH OF WHICH WHEN SO EXECUTED SHALL BE DEEMED TO BE AN
ORIGINAL, AND ALL OF WHICH WHEN TAKEN TOGETHER SHALL CONSTITUTE ONE AND THE SAME
INSTRUMENT.
29. THIS FIRST SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF NEW YORK.
30. THIS FIRST SUPPLEMENTAL INDENTURE SHALL BE EFFECTIVE ONLY UPON
RECEIPT BY THE TRUSTEE OF (i) THE OPINION OF COUNSEL REQUIRED BY SECTION 903 OF
THE INDENTURE, (ii) AN OPINION OF COUNSEL
-26-
<PAGE> 28
STATING THAT THE INDENTURE AS AMENDED PURSUANT TO THIS FIRST SUPPLEMENTAL
INDENTURE CONFORMS TO THE REQUIREMENTS OF THE TRUST INDENTURE ACT, AND (iii)
COPIES OF ALL OPINIONS OF COUNSEL DELIVERED TO THE HOLDERS OF THE PRIORITY NOTES
IN CONNECTION WITH THE CLOSING OF THE SALE OF THE PRIORITY NOTES WHICH OPINIONS
(OR A SEPARATE LETTER) SHALL STATE THAT THE TRUSTEE IS AUTHORIZED TO RELY
THEREON. THE TRUSTEE'S EXECUTION OF THIS FIRST SUPPLEMENTAL INDENTURE SHALL
ESTABLISH CONCLUSIVELY THAT THE TRUSTEE HAS RECEIVED THE OPINIONS REFERRED TO
ABOVE AND THAT, SUBJECT TO EXECUTION BY THE OTHER PARTIES HERETO, THE FIRST
SUPPLEMENTAL INDENTURE HAS BECOME EFFECTIVE.
-27-
<PAGE> 29
IN WITNESS WHEREOF, the parties have caused this First Supplemental
Indenture to be duly executed, and their respective seals to be affirmed, all as
of the date and year first written above.
ISSUER
Attest: FITZGERALDS GAMING CORPORATION
_________________________ By: ___________________________________________
Name: Fernando Bensuaski, Chief Executive Officer
Title:
SUBSIDIARY GUARANTORS
Attest: FITZGERALDS SOUTH, INC.
_________________________ By: ___________________________________________
Name: Fernando Bensuaski, Chief Executive Officer
Title:
Attest: FITZGERALDS RENO, INC.
_________________________ By: ___________________________________________
Name: Fernando Bensuaski, Chief Executive Officer
Title:
Attest: FITZGERALDS INCORPORATED
_________________________ By: ___________________________________________
Name: Fernando Bensuaski, Chief Executive Officer
Title:
Attest: FITZGERALDS LAS VEGAS, INC.
_________________________ By: ___________________________________________
Name: Fernando Bensuaski, Chief Executive Officer
Title:
Attest: FITZGERALDS FREMONT EXPERIENCE CORPORATION
By: ___________________________________________
_________________________ Fernando Bensuaski, Chief Executive Officer
Name:
Title:
-28-
<PAGE> 30
Attest: FITZGERALDS MISSISSIPPI, INC. (Formerly
POLK LANDING ENTERTAINMENT
CORPORATION)
By: ___________________________________________
_________________________ Fernando Bensuaski, Chief Executive Officer
Name:
Title:
Attest: FITZGERALDS BLACK HAWK, INC.
_________________________ By: ___________________________________________
Name: Fernando Bensuaski, Chief Executive Officer
Name:
Title:
TRUSTEE AND COLLATERAL AGENT
Attest: WELLS FARGO BANK, N.A. (Formerly FIRST
INTERSTATE BANK OF NEVADA, N.A.)
_________________________ By: ___________________________________________
Name:
Title:
-29-
<PAGE> 1
EXHIBIT 10.1
- --------------------------------------------------------------------------------
FITZGERALDS GAMING CORPORATION
$5,882,000 Principal Amount
of
13% Priority Secured Notes Due December 31, 1998
NOTE PURCHASE AGREEMENT
- --------------------------------------------------------------------------------
Dated as of December 30, 1996
<PAGE> 2
TABLE OF CONTENTS
PAGE
----
SECTION 1. DEFINITIONS................................................ 1
1.1 Terms Defined in the Indenture............................. 1
1.2 Additional Definitions..................................... 1
1.3 Rules of Construction...................................... 3
SECTION 2. PURCHASE AND SALE OF PRIORITY NOTES........................ 3
2.1 Issuance of Priority Notes................................. 3
2.2 Purchase and Sale of Priority Notes........................ 4
2.3 Registration and Transfer of Priority Notes .............. 4
2.4 Payment of the Priority Notes.............................. 5
2.5 Optional and Mandatory Prepayments; Ratable Purchases...... 6
2.7 Back-Stop Fee.............................................. 8
2.8 Taxes...................................................... 8
2.9 Indemnification............................................ 8
SECTION 3. CLOSING CONDITIONS......................................... 10
3.1 Delivery of Documents...................................... 10
3.2 Legal Investment........................................... 12
3.3 Payment of Expenses........................................ 13
3.4 Compliance with this Agreement............................. 13
3.5 Compliance with Laws....................................... 13
3.6 Representations and Warranties............................. 13
3.7 No Default................................................. 13
3.8 Proceedings Satisfactory................................... 13
3.9 No Legal Proceedings....................................... 14
3.10 No Material Adverse Change................................. 14
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
AND THE SUBSIDIARY GUARANTORS.............................. 14
4.1 Organization; Corporate Power.............................. 14
4.2 Good Standing.............................................. 14
4.3 Business................................................... 15
4.4 Subsidiaries............................................... 15
4.5 Authorization of Financing................................. 15
4.6 No Conflict................................................ 15
i
<PAGE> 3
PAGE
----
4.7 Governmental Approvals........................................ 16
4.8 Due Execution and Delivery; Binding Obligations............... 16
4.9 Securities Law Exemption...................................... 16
4.10 First Supplemental Indenture.................................. 17
4.11 Liens Securing Priority Note Obligations...................... 17
4.12 Financial Condition; Ownership of Property.................... 18
4.13 Litigation; Adverse Facts..................................... 18
4.14 Payment of Taxes.............................................. 19
4.15 No Indenture Defaults; Main Street Option Agreement in Effect 19
4.16 Las Vegas and Tunica Expansions............................... 19
4.17 Governmental Regulation....................................... 20
4.18 Disclosure.................................................... 20
4.19 Licenses, Permits and Authorizations.......................... 20
4.20 Hazardous Materials........................................... 20
4.21 Margin Stock.................................................. 21
4.22 Permitted Intercompany Notes.................................. 21
4.23 Brokers....................................................... 22
4.24 Solvency...................................................... 22
SECTION 5. REPRESENTATIONS AND WARRANTIES OF EACH
PURCHASER..................................................... 22
5.1 Purchase for Own Account...................................... 22
5.2 Accredited Investor........................................... 23
5.3 Authorization................................................. 23
SECTION 6. COVENANTS..................................................... 24
6.1 Additional Guarantors......................................... 24
6.2 Indenture Covenants........................................... 24
6.3 Note Documents................................................ 24
6.4 Use of Proceeds............................................... 24
6.5 Private Placement Number...................................... 25
SECTION 7. GUARANTY...................................................... 25
7.1 Guaranty...................................................... 25
7.2 Acceleration of Payment....................................... 25
7.3 Guaranty Absolute and Unconditional ......................... 25
7.4 Guaranty Irrevocable and Continuing........................... 26
7.5 Reinstatement................................................. 26
ii
<PAGE> 4
PAGE
----
7.6 Waiver ...................................................... 26
7.7 Subrogation................................................... 28
7.8 Fraudulent Transfer Limitation .............................. 29
7.9 Contribution among Subsidiary Guarantors .................... 29
7.10 No Limitation of Liability.................................... 30
7.11 Joint and Several Obligation.................................. 30
7.12 Condition of the Company...................................... 30
7.13 Amendment or Modification of Priority Notes Documents......... 31
7.14 Payments Free and Clear of Taxes.............................. 31
7.15 No Waiver; Remedies........................................... 32
7.16 Remedies Cumulative........................................... 32
7.17 Severally Enforceable......................................... 33
SECTION 8. DEFAULTS AND REMEDIES......................................... 33
8.1 Priority Notes Defaults....................................... 33
8.2 Acceleration.................................................. 34
8.3 Enforcement of Security....................................... 34
8.4 Right of Set-off.............................................. 35
8.5 Remedies Cumulative........................................... 35
SECTION 9. AMENDMENTS AND WAIVERS........................................ 35
SECTION 10. MISCELLANEOUS................................................. 36
10.1 Survival of Representations and Warranties.................... 36
10.2 Entire Agreement.............................................. 36
10.3 Successors and Assigns........................................ 37
10.4 Disclosure to Other Persons................................... 37
10.5 Notices....................................................... 37
10.6 Descriptive Headings.......................................... 38
10.7 Satisfaction Requirement...................................... 38
10.8 Independence of Covenants..................................... 38
10.9 Severability.................................................. 38
10.10 Waiver of Jury Trial; Consent to Jurisdiction................. 38
10.11 Waiver of Claim for Special, Indirect,
Consequential and Punitive Damages............................ 39
10.12 Governing Law................................................. 39
10.13 Counterparts.................................................. 40
10.14 Dating........................................................ 40
iii
<PAGE> 5
PAGE
----
iv
<PAGE> 6
ANNEX
1 Accretion Schedule
2 Purchaser Schedule
EXHIBITS
A Form of Priority Notes
B First Supplemental Indenture
C Global Amendment to Collateral Documents
D Certificate of Trustee
E-1 Amendment to Deed of Trust (Nevada)
E-2 Amendment to Deed of Trust (Mississippi)
E-3 Amendment to Preferred Ship Mortgage
F Opinion of Hughes Hubbard & Reed LLP
G Opinion of Schreck, Jones, Bernhard, Woloson & Godfrey
H-1 Opinion of Mississippi counsel
H-2 Opinion of Colorado counsel
I Opinion of Cara Brown, General Counsel
J Opinion of Latham & Watkins
K Officers' Certificate
L Receipt for Funding
SCHEDULES
4.4 Issued and Outstanding Stock of Company Subsidiaries
4.7 Governmental Approvals
4.16(a) Las Vegas Project and Tunica Project Unpaid Project Costs
4.16(b) Mechanics Liens
v
<PAGE> 7
NOTE PURCHASE AGREEMENT
This NOTE PURCHASE AGREEMENT is dated as of December 30, 1996
(this "Agreement") and entered into by and among (i) FITZGERALDS GAMING
CORPORATION, a Nevada corporation (the "Company"), (ii) FITZGERALDS SOUTH, INC.,
a Nevada corporation, FITZGERALDS RENO, INC., a Nevada corporation, FITZGERALDS
INCORPORATED, a Nevada corporation, FITZGERALDS LAS VEGAS, INC., a Nevada
corporation, FITZGERALDS FREMONT EXPERIENCE CORPORATION, a Nevada corporation,
FITZGERALDS MISSISSIPPI, INC., a Mississippi corporation formerly known as Polk
Landing Entertainment Corporation, and FITZGERALDS BLACK HAWK, INC., a Nevada
corporation (collectively, the "Subsidiary Guarantors"), and (iii) the
purchasers listed on the signature pages hereto (each a "Purchaser" and
collectively, the "Purchasers").
In consideration of the premises, mutual covenants and
agreements hereinafter contained and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
SECTION 1. DEFINITIONS
1.1 Terms Defined in the Indenture
Capitalized terms not otherwise defined herein shall have the
meanings ascribed to such terms in the Indenture dated as of December 19, 1995
delivered by the Company and the Subsidiary Guarantors to First Interstate Bank
of Nevada, N.A., as trustee, as amended as of the Closing Date pursuant to the
First Supplemental Indenture dated as of December 30, 1996 entered into by and
among the Company, the Subsidiary Guarantors and Wells Fargo Bank, N.A., as
successor trustee (the "Indenture"), on the terms and conditions and in the form
in effect on the Closing Date without giving effect to any subsequent amendment
thereto, waiver thereunder or discharge thereof, except any amendment or waiver
expressly approved in writing in accordance with Section 9.
1.2 Additional Definitions
As used in this Agreement:
"ACCOUNT MANAGER" means each Purchaser, if any, duly
authorized to act as attorney-in-fact on behalf of any Person in purchasing, in
the name of and using funds provided by such Person, Priority Notes thereunder.
<PAGE> 8
"ACCRETED VALUE" means, as to each Priority Note, (i) on and
after December 31, 1998, if the maturity of the Priority Notes has not been
accelerated pursuant to Section 8.2, 100% of the then Outstanding Stated Amount
of such Priority Note, (ii) as of any date of determination that occurs prior to
December 31, 1998 and is listed on the Accretion Schedule, an amount determined
by applying the percentage set forth next to such date in the Accretion Schedule
to the then Outstanding Stated Amount of such Priority Note, and (iii) as of any
date of determination that falls between any two dates listed on the Accretion
Schedule, an amount determined by applying an interpolated percentage, based on
the percentage set forth next to each of such two dates in the Accretion
Schedule and the portion of the period between them that has elapsed on such
date of determination, to the then Outstanding Stated Amount of such Priority
Note.
"ACCRETION SCHEDULE" means the schedule attached as Annex 1
hereto.
"BENEFICIARY" is defined in Section 7.1.
"CLOSING" is defined in Section 2.2(b).
"CLOSING DATE" is defined in Section 2.2(b).
"CONTINUING" means, as to any event constituting an Event of
Default, that such event occurred and has not been cured or corrected or
expressly waived in writing by the Required Priority Noteholders.
"DEFAULT PREMIUM" means, for any day when any Event of Default
has occurred and is Continuing, additional interest on the face amount of all
outstanding Priority Notes calculated at the rate of 2% per annum.
"EVENT OF DEFAULT" is not used as defined in the Indenture
and, instead, means each of the occurrences described in Section 8.1
"EFFECTIVE EQUIVALENT RATE" means 22.615% per annum.
"GUARANTEED OBLIGATIONS" is defined in Section 7.1.
"INDENTURE EVENT OF DEFAULT" means any "Event of Default," as
that term is defined in the Indenture.
2
<PAGE> 9
"MATERIAL ADVERSE EFFECT" means (i) a material adverse effect
upon the business, operations, properties, assets or condition (financial or
otherwise) of the Company and the Subsidiary Guarantors, taken as a whole, (ii)
a material adverse effect on the ability of the Company and the Subsidiary
Guarantors to pay the Priority Notes when due or to perform their obligations
under the Priority Notes Documents, or (iii) any material adverse change, after
the Closing Date, in the enforceability of any rights purporting to be granted
under the Priority Notes Documents or on the validity, perfection, priority or
enforceability of any Liens securing Priority Note Obligations. In determining
whether any individual event would result in a Material Adverse Effect,
notwithstanding that such event does not of itself have such effect, a Material
Adverse Effect shall be deemed to have occurred if the cumulative effect of such
event and all other then existing events would result in a Material Adverse
Effect.
"OUTSTANDING STATED AMOUNT" means, as to any Priority Note,
the stated principal amount thereof, reduced as necessary to give effect to any
partial prepayment of such Priority Note that has theretofore been made pursuant
to Section 2.5(a) or Section 2.5(b).
"PRIORITY NOTES DOCUMENTS" means this Agreement, the Priority
Notes, the First Supplemental Indenture (including the amendments to the
Indenture made by the First Supplemental Indenture) and the Priority Notes
Collateral Documents.
"PURCHASE PRICE" means $5,010,464.
"PURCHASER SCHEDULE" means the schedule attached as Annex 2
hereto.
"REQUIRED PRIORITY NOTEHOLDERS" means (i) on or prior to the
Closing Date, the Purchasers, and (ii) thereafter, subject to the provisions of
Section 9, the registered holders of a majority in principal amount of Priority
Notes then outstanding.
1.3 Rules of Construction
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) words in the singular include the plural, and words
in the plural include the singular;
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(d) provisions apply to successive events and
transactions;
(e) "herein," "hereof" and other words of similar import
refer to this Agreement as a whole and not to any
particular Section or other subdivision;
(f) "including" and "include" are used for purposes of
illustration or clarity and shall not qualify,
characterize or limit the class in which an item is
included; and
(g) references to a Section, when not qualified by
reference to any other document, are references to
the Sections in this Agreement.
SECTION 2. PURCHASE AND SALE OF PRIORITY NOTES
2.1 Issuance of Priority Notes
(a) Authorization. On or before the Closing Date, the
Company will have authorized the issuance of $5,882,000 aggregate principal
amount of its 13% Priority Secured Notes due December 31, 1998 in substantially
in the form attached hereto as Exhibit A and the sale of such Priority Notes on
the Closing Date for the Purchase Price on the terms and conditions set forth
herein.
(b) Form and Amount. The Priority Notes shall be issued
on the Closing Date in substantially in the form attached hereto as Exhibit A
and shall be dated as of the Closing Date. The aggregate principal amount of the
Priority Notes issued on the Closing Date shall not exceed $5,882,000, and no
Priority Notes shall thereafter be issued by the Company except pursuant to
Section 2.3.
2.2 Purchase and Sale of Priority Notes
(a) Purchase and Sale. The Company agrees to sell and,
subject to the terms and conditions set forth herein and in reliance on the
representations and warranties of the Company and the Subsidiary Guarantors set
forth herein, each Purchaser agrees, severally and not jointly, to purchase
Priority Notes in the stated principal amount set forth below such Purchaser's
name on the Purchaser Schedule, at a purchase price equal to 85.183% of such
stated principal amount and, in the aggregate for all Purchasers, equal to the
Purchase Price.
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(b) Closing. The purchase and sale of the Priority Notes
shall take place at a closing (the "Closing") at the offices of Schreck, Jones,
Bernhard, Woloson & Godfrey in Las Vegas, Nevada at 10:00 a.m. on December 30,
1996, or such other business day on or prior to December 31, 1996, as may be
agreed by the Purchasers and the Company (the "Closing Date"). At the Closing,
the Company will deliver to each Purchaser the Priority Notes to be purchased by
such Purchaser (for the amount of its aggregate purchase commitment and
registered in its name or in such other permitted denominations and registered
in such other name as may be set forth as to such Purchaser in the Purchaser
Schedule), dated the Closing Date, against payment of the purchase price
therefor by intra-bank or federal funds bank wire transfer of same day funds to
such bank account as the Company shall designate at least one Business Days
prior to the Closing. If, at the Closing, the Company fails to tender any of the
Priority Notes to the Purchasers or any condition set forth in Section 3 is not
satisfied or waived by the Purchasers, each Purchaser shall be relieved of its
obligation to purchase the Priority Notes.
2.3 Registration and Transfer of Priority Notes
(a) Issued in Registered Form. The Priority Notes shall
be issued as registered notes only, each without coupons in denominations of at
least $100,000 or any smaller denomination upon transfer of any Priority Note on
which the outstanding principal amount is less than $100,000.
(b) Transfer. Subject only to applicable securities laws,
the Purchaser and each other holder of any of the Priority Notes shall have the
unqualified right freely and without any restriction or limitations whatsoever,
and both before and after the maturity of the Priority Notes, (i) to sell,
pledge or otherwise transfer any of the Priority Notes in any denomination
permitted under Section 2.3(a) and in any transaction to any Person, and (ii) to
sell or grant participations or other interests in any of the Priority Notes to
any Person while remaining a holder thereof for purposes of the Priority Notes
Documents and giving the owner of such participation or interest such approval
or consent rights as such holder and owner may privately agree.
(c) Maintenance of Office. The Company will maintain, in
The City of New York, an office where the Company shall maintain a note register
of all registered holders of Priority Notes. The Company will allow any holder
of any Priority Note to inspect and copy such note register at such office
during normal business hours, without any other restriction as to the time,
frequency or purpose thereof.
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(d) Exchange and Reissuance. Upon surrender of any
Priority Notes for registration of transfer or for exchange into other
authorized denominations at the office in The City of New York maintained by the
Company pursuant to Section 2.3(c), the Company shall at its expense execute and
deliver new Priority Notes in the same aggregate amount, dated the Closing Date
and in such denominations and registered in such name as the registered holder
of the surrendered Priority Note may direct. If the Company receives, at such
office, an affidavit of the registered holder of any Priority Note or other
evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of such Priority Note, together with indemnity reasonably
satisfactory to the Company, the Company will execute and deliver at such office
a new Priority Note on the identical terms.
(e) Registered Holder Deemed Owner. Until a Priority Note
is surrendered for registration of transfer, duly endorsed, the Company may
treat the registered holder thereof as the owner and holder of such Priority
Note for all purposes, and the Company shall not be affected by notice to the
contrary.
(f) Surviving Obligations. Notwithstanding any
registration or transfer of any Priority Note, each Purchaser, each prior or
current beneficial owner and each prior or current registered holder of each
Priority Note shall be and remain entitled to enforce all obligations of the
Company and Subsidiary Guarantors under the Priority Notes Documents, including
expense reimbursement, tax and indemnification obligations, that survive the
repayment of the Priority Notes.
2.4 Payment of the Priority Notes
(a) Payment of Principal. The Company promises to pay the
stated principal amount of each Priority Note to the registered holder thereof
on December 31, 1998. If the maturity of the Priority Notes is accelerated
pursuant to Section 8.2, the Company promises to pay the Accreted Value of each
Priority Note, determined as of the date such acceleration becomes effective, to
the registered holder thereof. Presentment of the Priority Notes for payment
and, to the fullest extent permitted by law, all other demands for payment and
notices of nonpayment of the Priority Notes are hereby waived.
(b) Payment of Interest. The Company promises to pay
interest on each Priority Note (i) through and including December 31, 1998, if
the maturity of the Priority Notes has not been accelerated, at the rate of 13%
per annum applied to the Outstanding Stated Amount of such Priority Note from
time to time as interest accrues, computed on the basis of a year of 360 days
consisting of 12 months of 30 days each
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and payable semi-annually on each June 30 and December 31, commencing June 30,
1997, to the registered holder of such Priority Note on the fifteenth day of
such month, plus, for any day on which any Event of Default has occurred and is
Continuing, the Default Premium, payable on demand to the registered holder of
such Priority Note on the date such Default Premium is paid, and (ii) commencing
on the day on which the Priority Notes are due and payable in full (whether at
maturity or by acceleration or otherwise), at the Effective Equivalent Rate plus
the Default Premium, applied to the Accreted Value of such Priority Note on the
day the Priority Notes became due and payable in full, payable on demand to the
registered holder of such Priority Note on the date payment is made.
2.5 Optional and Mandatory Prepayments; Ratable Purchases
(a) Voluntary Prepayment. The Company may prepay the
Priority Notes at any time, in whole or in part, but only by paying the Accreted
Value of all outstanding Priority Notes determined as of the date on which the
prepayment is made (or, in the case of a prepayment in part, by paying a portion
of such Accreted Value) plus all interest accrued and unpaid on the Priority
Notes as of such date (or, if only a portion of such Accreted Value is prepaid,
an equivalent portion of such interest). Each prepayment in part shall be made
in accordance with this Section 2.5 and in a minimum amount of not less than
$500,000 in stated principal amount.
(b) Mandatory Prepayment. The Company shall prepay the
Priority Notes as follows:
(1) On the fifteenth Business Day after the
occurrence of any Change of Control (as that term is defined in Section
1109 of the Indenture), the Company shall prepay the Priority Notes in
full at the then Accreted Value and further shall pay all interest then
accrued and unpaid on the Priority Notes.
(2) Within 210 days after the occurrence of any Asset
Sale (as that term is defined in Section 1016(a) of the Indenture),
other than in a transaction permitted under Section 1016(b) of the
Indenture, and prior to making any Asset Sale Purchase Offer in respect
of such Asset Sale pursuant to Section 1016(a) of the Indenture, the
Company shall prepay the Priority Notes (based on their then Accreted
Value) and interest then accrued and unpaid on the portion of the
principal of the Priority Notes represented by such Accreted Value in
an amount that is equal to (i) the Net Cash Proceeds from such Asset
Sale less (ii) all such Net Cash Proceeds that have then been
reinvested in assets or property directly related to a Related Business
of the Company or a Restricted
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Subsidiary (or to be so reinvested pursuant to a binding obligation
that has then been entered into by the Company or such Restricted
Subsidiary).
(c) Notice of Prepayments. The Company shall give each
registered holder of Priority Notes written notice of each optional prepayment
of Priority Notes pursuant to Section 2.5(a) not less than ten Business Days
prior to the prepayment date, which notice shall (i) specify the prepayment date
(which shall be a Business Day), (ii) state the amount to be applied to
prepayment of the Priority Notes on such date, and (iii) set forth in reasonable
detail calculations specifying the Accreted Value of the Priority Notes as of
such date and all accrued and unpaid interest outstanding on the Priority Notes
to and including such date. Upon the giving of any such prepayment notice, such
amount shall become due and payable on such prepayment date.
(d) Partial Prepayments Made Ratably and Applied First to
Interest. No partial prepayment of Priority Notes may be made unless, in the
case of each such prepayment, the aggregate amount of principal being prepaid is
allocated ratably among all Priority Notes then outstanding in proportion to the
respective unpaid principal amount of each outstanding Priority Note. All
prepayments in part shall be applied first to pay interest required to be
prepaid.
(e) Purchase of Priority Notes. The Company shall not,
and shall not permit any of its Subsidiaries or Affiliates to, purchase, redeem
or otherwise acquire any Priority Note from any holder, except pursuant to a
payment or prepayment in accordance with the specific terms of this Agreement or
pursuant to a ratable purchase offer which is set forth in a writing submitted
on identical terms to all holders of Priority Notes at least ten Business Days
prior to the date on which such offer expires. Any Priority Note purchased,
redeemed or otherwise acquired by the Company or any of its Subsidiaries shall
immediately be retired and discharged and may not be reissued.
2.6 Costs and Expenses
Whether or not the Priority Notes are sold, the Company and
the Subsidiary Guarantors agree to bear their own costs and expenses (including
the fees and disbursements of counsel acting for any of them) and further
jointly and severally agree upon demand to pay and make reimbursement for all
expenses relating to this Agreement, including:
(a) each Purchaser's reasonable out-of-pocket
expenses incurred in connection with the transactions contemplated by
this Agreement;
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(b) the reasonable fees and other charges of the
Purchasers' counsel, Latham & Watkins, in connection herewith;
(c) the cost of delivering to each Purchaser's
home office or the office of such Purchaser's designee, insured to such
Purchaser's satisfaction, the Priority Notes and the other documents
contemplated hereby;
(d) any reasonable out-of-pocket fees and
expenses (including the reasonable fees and expenses of counsel) in
connection with any registration or qualification of the Priority Notes
required in connection with the offer and sale of the Priority Notes at
the Closing pursuant to this Agreement under the securities or "blue
sky" laws of any jurisdiction requiring such registration or
qualification or in connection with obtaining any exemptions from such
requirements;
(e) all reasonable out-of-pocket expenses
(including all reasonable fees and expenses of counsel, advisors and
expert witnesses, subject to receipt of reasonably detailed
documentation thereof) incurred by any Purchaser or any beneficial
owner or holder of any of the Priority Notes in connection with any
amendment or modification of any of the Priority Notes Documents, or
any waiver or consent granted thereunder or while any Event of Default
is Continuing or in connection with the protection, preservation,
collection or enforcement of any rights under this Agreement, the
Priority Notes or any other Priority Notes Documents or the Priority
Notes Collateral in any debt restructuring, legal proceedings or
Bankruptcy, Insolvency or Liquidation Proceeding; and
(f) all other reasonable costs and expenses,
including reasonable counsel fees and all fees and expenses payable to
the Trustee, incurred in connection with the transactions contemplated
by this Agreement.
The Company shall deliver to each Purchaser or to such other
persons as such Purchaser shall direct, at the Closing, by intra-bank or federal
funds bank wire transfer of same day funds, payment for all out-of-pocket
expenses for which such Purchaser is entitled to reimbursement pursuant to this
Section 2.6 and the fees and expenses of the Purchasers' counsel payable
pursuant to this Section 2.6, or at such Purchaser's election shall authorize
such Purchaser to deduct such amount from the Purchase Price.
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The obligations set forth in this Section 2.6 shall survive
the payment of the Priority Notes and the termination of this Agreement.
2.7 Back-Stop Fee
At the Closing, the Company shall pay to TCW SHARED
OPPORTUNITY FUND II, L.P., a Delaware limited partnership ("TCW"), a fee in the
amount of $100,000, by intra-bank or federal funds bank wire transfer of same
day funds or at TCW's election shall authorize TCW to deduct such amount from
that portion of the Purchase Price payable by it. Such fee is payable solely as
compensation for an offer by TCW (which offer lapsed upon execution and delivery
of this Agreement by the Purchasers) to purchase any and all Priority Notes on
the Closing Date on the terms herein set forth and is fully earned at the
Closing and nonrefundable when paid.
2.8 Taxes
The Company and the Subsidiary Guarantors jointly and
severally agree to pay all taxes, and all interest and penalties thereon,
payable in connection with the issuance, sale, delivery or transfer of the
Priority Notes and the execution, delivery, recordation, amendment or
performance of the instruments and agreements contemplated hereby and will
indemnify and hold harmless each Purchaser and each beneficial owner and
registered holder of any of the Priority Notes against any and all liabilities
with respect to all such taxes, without limitation as to time. The obligations
set forth in this Section 2.8 shall survive the payment of the Priority Notes
and the termination of this Agreement.
2.9 Indemnification
The Company and the Subsidiary Guarantors jointly and
severally agree to defend, indemnify, pay and hold harmless the Purchasers and
each present and future beneficial owner and registered holder of the Priority
Notes, or any interest therein, and each of their respective Account Managers,
officers, directors, employees, attorneys, agents and Affiliates (collectively,
the "Indemnitees") from and against any and all actions, causes of action, suits
and claims of any nature by any Person other than the Company or a Subsidiary
Guarantor (collectively, "Claims") and all losses, liabilities, damages and
expenses (including the reasonable fees and expenses of counsel engaged by any
Indemnitee, whether or not suit is brought) in connection with any such Claim
(collectively, the "Indemnified Liabilities") incurred by any Indemnitee as a
result of, or arising out of, or relating to this Agreement, the Priority Notes,
any of the
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other Priority Notes Documents, or, in each case, any of the documents, acts or
events contemplated or referred to therein or transactions contemplated thereby
or the enforcement of any of the terms thereof; provided, however, that the
Company shall not be liable to any Indemnitee for Indemnified Liabilities
consisting of an award of damages assessed against such Indemnitee in a judicial
proceeding in which a final, non-appealable determination has been made that
such damages are directly attributable to the gross negligence or willful
misconduct of such Indemnitee.
In addition, the Company and the Subsidiary Guarantors
jointly and severally agree to defend, indemnify, pay and hold the Indemnitees
harmless from and against and shall reimburse the Indemnitees for, any and all
losses, claims, liabilities, damages, injunctive relief, injuries to person,
property or natural resources, fines, penalties, costs, expenses (including the
reasonable fees and disbursements of counsel, whether or not suit is brought and
specifically including special and local counsel and allocated costs of internal
counsel, costs of any appeal, and costs of settlement actually incurred),
actions and causes of action (collectively, "Hazardous Materials Costs and
Liabilities") arising directly or indirectly, in whole or in part, out of the
release, discharge, deposit, presence, transportation or storage or alleged
release, alleged discharge, alleged deposit, alleged presence, alleged
transportation or alleged storage of any hazardous materials at, on, under or
from any real or personal property owned or leased by the Company or any
Subsidiary or in or adjacent to any part of such property or in the soil or
groundwater on or under such property, whether or not known to the Company or
any of its Subsidiaries or to any Indemnitee, whether foreseeable or
unforeseeable, regardless of the source of such release, discharge, deposit,
presence, transportation or storage. The foregoing indemnity and the Hazardous
Materials Costs and Liabilities shall include all costs in law or in equity of
cleanup, removal, remediation and restoration of any kind and disposal of any
such hazardous materials (whether or not now existing), all costs of determining
whether any real or personal property owned or leased by the Company or any of
its Subsidiaries is in compliance and causing such property to be or become in
compliance with all applicable environmental laws, all costs and liabilities
associated with claims for damages to persons, property or natural resources,
and all environmental consultants' and attorneys' fees and costs. In no event
shall any provision of this Section 2.9 be deemed to be a waiver of or to be in
lieu of any right or claim, including any right of contribution or other right
of recovery, that any Indemnitee might otherwise have against the Company or any
of its Subsidiaries under any environmental laws or that the Company or any of
its Subsidiaries might otherwise have against any third party.
If and to the extent any indemnification obligation set forth
in this Section 2.9 is unenforceable as a matter of law for any reason or in any
particular
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circumstance, the Company and each Subsidiary Guarantor shall make
the maximum contribution to the payment and satisfaction of such obligation that
it is permitted to make under applicable law.
The obligations set forth in this Section 2.9 shall survive
the repayment of the Priority Notes.
SECTION 3. CLOSING CONDITIONS
The obligation of each Purchaser to purchase and pay for the
Priority Notes to be delivered to such Purchaser at the Closing shall be subject
to the satisfaction of the following conditions on or before the Closing Date:
3.1 Delivery of Documents
The Company shall have delivered to each Purchaser, in form
and substance satisfactory to such Purchaser, the following:
(a) Counterparts of this Agreement duly executed
and delivered by the Company, each Subsidiary Guarantor and each
Purchaser.
(b) The Priority Notes being purchased by such
Purchaser, duly executed by the Company, in the aggregate principal
amount set forth below such Purchaser's name on the signature pages
hereto.
(c) The First Supplemental Indenture, in
substantially the form of Exhibit B attached hereto, duly executed and
delivered by the Company, the Subsidiary Guarantors and the Trustee,
together with (i) all directions, certificates and legal opinions
delivered to the Trustee in connection therewith, accompanied by a
letter from the issuers thereof stating that the Purchasers shall have
the right to rely thereon, (ii) a certificate of the Trustee, addressed
to the Purchasers, certifying that an attached copy of the Indenture,
as amended by the First Supplemental Indenture, is a true, correct and
complete copy thereof and is in full force and effect, and (iii) a
certificate of the registered holder of each Note Unit Certificate or
Note Certificate that is Outstanding under the Indenture, certifying
that the legend required under Section 201 of the Indenture has been
placed thereon and attaching a copy thereof, showing such legend.
(d) A Global Amendment to Collateral Documents
in substantially the form of Exhibit C attached hereto, duly executed
by the
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Company, the Subsidiary Guarantors and the Trustee, together with (i) a
certificate of the Trustee in the form of Exhibit D attached hereto,
(ii) mortgage amendments in the form of Exhibits E-1, E-2 and E-3
attached hereto, duly executed, delivered and acknowledged by the
Trustee and Subsidiary Guarantors named therein as party thereto, and
(iii) an amendment to each financing statement on file against the
Company or any Subsidiary Guarantor in any public office that names the
Trustee as secured party, stating that Wells Fargo Bank, N.A. is the
successor Trustee and Collateral Agent, setting forth an address of
Wells Fargo Bank, N.A. from which information concerning the security
interest may be obtained, and stating that the Trustee and Collateral
Agent also act as agent for all present and future holders of
$5,882,000 in principal amount of the Company's 13% Priority Secured
Notes due December 31, 1998 and certain related guaranties and
obligations.
(e) Legal opinion letters, dated the Closing
Date and addressed to the Purchasers, by:
(1) Hughes Hubbard & Reed LLP, counsel
for the Company and the Subsidiary Guarantors, in
substantially the form of Exhibit F attached hereto.
(2) Schreck, Jones, Bernhard, Woloson &
Godfrey, Nevada counsel for the Company and the Subsidiary
Guarantors incorporated in the State of Nevada, in
substantially the form of Exhibit G attached hereto.
(3) The Company's counsel in the States
of Mississippi and Colorado, in substantially the form of
Exhibits H-1 and H-2, respectively, attached hereto.
(4) Cara Brown, the Company's General
Counsel, in substantially the form of Exhibit I attached
hereto.
(5) Latham & Watkins, special counsel
for the Purchasers, in substantially the form of Exhibit J
attached hereto.
(f) A certificate of the Chief Financial Officer
and Vice President and General Counsel of the Company, dated the
Closing Date, in substantially the form of Exhibit K attached hereto.
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(g) Certificates of the Secretary or an
Assistant Secretary of the Company and each Subsidiary Guarantor,
certifying (i) copies of resolutions of the Board of Directors of the
Company or such Subsidiary Guarantor, as in effect on the Closing Date,
authorizing the execution, delivery and performance of this Agreement
and the other Priority Notes Documents, the issuance and sale of the
Priority Notes, and the consummation of transactions contemplated
thereby, (ii) copies of the articles of incorporation and by-laws of
the Company or such Subsidiary Guarantor, as in effect on the Closing
Date, and (iii) as to the incumbency and signatures of each officer of
the Company or such Subsidiary Guarantor who executed any document or
otherwise acted for it as to the documents and matters set forth in
this Section 3.
(h) A good standing certificate for the Company
and each Subsidiary Guarantor issued by the Secretary of State for the
State of Nevada and issued by the Secretary of State of the State of
Mississippi as to the good standing of Fitzgeralds Mississippi, Inc.
(i) A Receipt for Funding in substantially the
form of Exhibit L, duly executed by an authorized officer of the
Company and each Subsidiary Guarantor.
(j) Such additional documents and materials as
any Purchaser may reasonably request, including copies of any material
contracts to which the Company or any Subsidiaries is a party.
3.2 Legal Investment
Each Purchaser's acquisition of the Priority Notes shall
constitute a legal investment as of the Closing Date under the laws and
regulations and orders of each jurisdiction to which such Purchaser may be
subject (without resort to any "basket" or "leeway" provision which permits the
making of an investment without restriction as to the character of the
particular investment being made), and such acquisition shall not subject such
Purchaser to any penalty or, in its reasonable judgment, other onerous condition
in or pursuant to any such law, regulation or order; and such Purchaser shall
have received such certificates or other evidence as such Purchaser may
reasonably request to establish compliance with this condition.
3.3 Payment of Expenses
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The Company shall have paid or reimbursed all of the
Purchasers' expenses as provided in Section 2.6, including the reasonable fees
and disbursements of Latham & Watkins through the date of Closing, and shall
have paid the fee payable under Section 2.7.
3.4 Compliance with this Agreement
The Company and the Subsidiary Guarantors shall have performed
and observed all obligations, covenants and conditions contained in any of the
Priority Notes Documents which are required to be performed or observed by any
of them on or before the Closing Date.
3.5 Compliance with Laws
The offering, issuance and sale of the Priority Notes under
this Agreement shall be in compliance with all applicable requirements of
federal and state securities laws and the Company and the Subsidiary Guarantors
shall in all other respects have complied with all requirements of law
applicable to the authorization, execution, delivery and performance of the
Priority Notes Documents.
3.6 Representations and Warranties
Each statement, representation or warranty made in Section 4
or in any document delivered pursuant to Section 3.1 shall be true and correct
on and as of the Closing Date.
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3.7 No Default
No event which constitutes, or which upon the giving of notice
or lapse of time (or both) would constitute, an Event of Default shall have
occurred and be Continuing or would result from the issuance, sale or purchase
of the Priority Notes.
3.8 Proceedings Satisfactory
All proceedings taken in connection with the sale of the
Priority Notes, the transactions contemplated hereby, and all documents and
papers relating thereto, shall be reasonably satisfactory to each Purchaser.
Each Purchaser and its counsel shall have received copies of such documents and
papers as they may reasonably request in connection therewith, or that are
relied on or referred to in any certificates or opinions delivered at the
Closing, all of which shall be in form and substance reasonably satisfactory to
such Purchaser. Any document annexed to this Agreement or any other document
contemplated by this Agreement not approved by any Purchaser in writing as to
form and substance on the date this Agreement is executed shall be satisfactory
in form and substance to such Purchaser.
3.9 No Legal Proceedings
There shall be no action, suit, investigation or proceeding
pending or, the knowledge of the Company, any of its Subsidiaries or any
Purchaser, threatened against or affecting the Company or any of its
Subsidiaries or any Purchaser or any of their respective properties or rights or
any of their respective Affiliates, Account Managers, associates, funds,
officers or directors, before any court, arbitrator, administrative agency or
governmental authority which (i) seeks to restrain, enjoin, prevent the
consummation of or otherwise affect the transactions contemplated hereby or (ii)
questions the validity or legality of any such transactions or seeks to recover
damages or obtain other relief relating to any such transactions.
3.10 No Material Adverse Change
No event or series of events shall have occurred since
December 31, 1995, other than events disclosed in the Company's Quarterly
Reports on Form 10-Q (or Form 10Q/A) filed for the first three quarters of 1996,
that have had, or could reasonably be expected to have, a Material Adverse
Effect.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SUBSIDIARY
GUARANTORS
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Each of the Company and the Subsidiary Guarantors represents
and warrants, jointly and severally, as follows:
4.1 Organization; Corporate Power
Each of the Company and Subsidiary Guarantors is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Nevada or, in the case of Fitzgeralds Mississippi, Inc., the State of
Mississippi, and has all requisite corporate power and authority to own or lease
and operate its property, to carry on its business as now conducted and to enter
into this Agreement and the other Priority Notes Documents and to issue and sell
the Priority Notes and to carry out the transactions contemplated hereby and
thereby.
4.2 Good Standing
The Company and each of its Subsidiaries is in good standing
wherever necessary to carry on its present business and operations, except in
jurisdictions in which the failure to be in good standing has not had, would not
have, and could not reasonably be expected to have, a Material Adverse Effect.
4.3 Business
The Company and its Subsidiaries are engaged only in the
businesses described in the Prospectus or the Company's Annual Report on Form
10-K for the year ended December 31, 1995, have conducted and are conducting
such business in substantial compliance with all applicable laws and own or hold
under lease all property, have entered into all contracts and agreements, and
hold all required Gaming Licenses, necessary to conduct such businesses as
presently conducted.
4.4 Subsidiaries
All of the Company's existing Subsidiaries are identified on
Schedule 4.4. All of the outstanding capital stock of each such Subsidiary has
been duly authorized and validly issued and is fully paid and nonassessable and
such shares of capital stock are free and clear of any claim, Lien, encumbrance
or agreement with respect thereto, other than the Liens granted to the Trustee
or Collateral Agent pursuant to the Collateral Documents. Schedule 4.4 correctly
sets forth the ownership of the stock of the Company and each of its
Subsidiaries.
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4.5 Authorization of Financing
The execution, delivery and performance of this Agreement and
the other Priority Notes Documents, the issuance, sale, delivery and payment of
the Priority Notes, and the consummation of the transactions contemplated hereby
and thereby have been duly authorized by all necessary corporate action by the
Company and each Subsidiary Guarantor.
4.6 No Conflict
The execution, delivery and performance by the Company and
each Subsidiary Guarantor of each Priority Notes Document to which it is a party
and the issuance, sale, delivery and payment of the Priority Notes and, in each
case, the consummation of the transactions contemplated thereby, do not and will
not (i) violate the certificate of incorporation or bylaws of the Company or any
of its Subsidiaries, or any order, judgment or decree of any court or other
agency of government binding upon any the Company or any of its Subsidiaries,
(ii) violate any provision of law, or any rules or regulations of any
governmental authority, applicable to the Company or any of its Subsidiaries,
(iii) violate, conflict with, result in a material breach of or constitute (with
notice or lapse of time or both) a default under (A) any Gaming License, (B) any
indenture, mortgage or agreement governing or relating to the terms on which any
Indebtedness of the Company or any Restricted Subsidiary was incurred, is
secured or must be repaid, (C) any ground lease or other lease by which the
Company or a Restricted Subsidiary has the right to possess casino or hotel
space, (D) any lease of slot machines or gaming equipment, (E) the Main Street
Option Agreement, or (F) any other agreement to which the Company or any of its
Subsidiaries is a party or by which any of their property is bound, other than
agreements ("Immaterial Agreements") under which it acquires readily replaceable
goods or services or the loss of which and any liability on which could not
reasonably be expected to have a Material Adverse Effect, (iv) other than Liens
granted to the Trustee or Collateral Agent pursuant to the Priority Notes
Collateral Documents, result in or require the creation or imposition of any
Lien (other than Permitted Liens) upon any property of the Company or any of its
Subsidiaries, or (v) require any approval or consent of stockholders of the
Company or any of its Subsidiaries or require any approval or consent of any
Person under any indenture, mortgage, instrument, contract or other agreement,
except Immaterial Agreements, to which the Company or any of its Subsidiaries is
a party or by which any of their property is bound.
4.7 Governmental Approvals
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Except as otherwise set forth on Schedule 4.7, the execution,
delivery and performance by the Company and each Subsidiary Guarantor of each
Priority Notes Document to which it is a party and the issuance, sale, delivery
and payment of the Priority Notes by the Company and the consummation of the
transactions contemplated hereby and thereby and the creation, perfection, and
prioritization of Liens upon all Collateral to secure Priority Note Obligations
pursuant to the Priority Notes Collateral Documents, do not and will not require
any registration or filing with, consent or approval of, or notice to, or other
action to, with or by, any foreign or domestic federal, state or other
governmental authority or regulatory body.
4.8 Due Execution and Delivery; Binding Obligations
This Agreement has been duly executed and delivered by the
Company and the Subsidiary Guarantors and, at the Closing, each other Priority
Notes Document then delivered pursuant to Section 3.1 will have been duly
executed and delivered by the Company and the Subsidiary Guarantors and each
other Person identified therein as a signatory party thereto, other than the
Purchasers. This Agreement is, and, at the time of the Closing, the Priority
Notes and each such other Priority Notes Document will be, the legal, valid and
binding obligation of the Company, the Subsidiary Guarantors and each such other
signatory party thereto, other than the Purchasers, enforceable against each of
them in accordance with their respective terms, except for (i) the effect
thereon of bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting the rights of creditors generally, (ii)
limitations imposed by federal or state law or equitable principles upon the
specific enforceability of any of the remedies, covenants or other provisions
thereof and upon the availability of injunctive relief or other equitable
remedies and (iii) the effect of general principles of equity, including
concepts of materiality, reasonableness, good faith and fair dealing, regardless
of whether considered in a proceeding in equity or at law.
4.9 Securities Law Exemption
The offering, issuance and sale of the Priority Notes
hereunder are exempt from the registration and prospectus delivery requirements
of the Securities Act and from all registration and qualification requirements
under applicable state securities laws. With respect to the offering, issuance
and sale of the Priority Notes, no form of general solicitation or general
advertising was used by the Company or any Person acting for it as agent,
broker, dealer or otherwise in connection with the offering or sale of the
Priority Notes, including advertisements, articles, notices or other
communications published in any newspaper, magazine or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited
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by any general solicitation or general advertising. The Purchasers are the sole
purchasers of the Priority Notes. No securities of the same class as the
Priority Notes have been issued and sold by the Company within the six-month
period immediately prior to the date hereof. The Company understands that, for
purposes of rendering the legal opinions to be delivered pursuant to Section
3.1, the Company's counsel and special counsel to the Purchasers will rely on
the accuracy and truth of the foregoing representations, and the Company hereby
consents to such reliance.
4.10 First Supplemental Indenture
As of the Closing, the amendments made to the Indenture
pursuant to the First Supplemental Indenture are in full force and effect and
binding upon the Company, the Subsidiary Guarantors, the Trustee and all present
and future Holders of all Outstanding Notes.
4.11 Liens Securing Priority Note Obligations
As of the Closing, (i) the provisions of the Indenture and all
Priority Notes Collateral Documents delivered at the Closing are effective to
create legally enforceable Liens upon all of the Collateral to secure the
Priority Note Obligations, except as otherwise set forth in the last paragraph
of Section 1202(b) of the Indenture, (ii) such Liens are duly perfected as
against all subsequent Lien creditors and bona fide purchasers of the Collateral
or any such other property, except that mortgage amendments in the forms of
Exhibits E-1, E-2 and E-3 must be filed for record in order to perfect the Liens
created thereby (and will be filed promptly after the Closing) and except for
buyers of inventory in the ordinary course of business, (iii) no further actions
are required in order to perfect and maintain the perfection of such Liens upon
any and all of the Collateral or such other property, except for (x) the filing
of such mortgages for record, (y) maintenance of possession of pledged
Collateral by the Trustee or Collateral Agent or an agent acting for either of
them, and (z) the filing of continuation statements when required under the
Uniform Commercial Code, (iv) such Liens are first and prior Liens, and (v) the
provisions added to Section 1202(b) of the Indenture pursuant to the First
Supplemental Indenture are enforceable in accordance with their terms.
4.12 Financial Condition; Ownership of Property
The consolidated balance sheets of the Company and its
Subsidiaries at December 31, 1995 and the related consolidated statements of
income and cash flows, which have been examined by Deloitte & Touche, LLP, who
delivered an unqualified
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opinion with respect thereto, and the unaudited consolidated balance sheets and
related statements of income and cash flows of the Company and its Subsidiaries
as at the last day of each of the first three fiscal quarters of 1996 and the
related consolidated statements of income and cash flows for periods then ended
contained in the Company's Quarterly Reports on Form 10-Q (or Form 10-Q/A) for
such periods, were prepared in conformity with GAAP. All such financial
statements fairly present the consolidated financial position of the Company and
its Subsidiaries as at the respective dates thereof and the consolidated results
of operations and cash flows of the Company and its Subsidiaries for each of the
periods covered thereby, subject, in the case of any unaudited interim financial
statements, to changes resulting from normal year-end adjustments. Neither the
Company nor any of its Subsidiaries has any contingent liability or any
liability for taxes, long-term lease or forward or long-term commitment that is
not reflected in such financial statements or the notes thereto. The Company and
its Subsidiaries have good and valid fee title to its real property owned in fee
and a valid leasehold interest in its leased real property and valid title to or
beneficial ownership of all their other respective property reflected in such
financial statements, or the notes thereto, except for assets acquired or
disposed of in transactions that are permitted under the Indenture and except
for such defects to title that are disclosed in the title insurance policies
delivered to the Trustee to secure the Liens granted under the Collateral
Documents or that have not had, do not have, and could not reasonably be
expected to have a Material Adverse Effect. All such properties and assets are
free and clear of Liens other than Permitted Liens. The Company and its
Subsidiaries have quiet enjoyment, as sole lessee, under all of their real
property leases. All of such leases are in full force and effect and are valid
and enforceable in accordance with their terms (except for (i) the effect
thereon of bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting the rights of creditors generally, (ii)
limitations imposed by federal or state law or equitable principles upon the
specific enforceability of any of the remedies, covenants or other provisions
thereof and upon the availability of injunctive relief or other equitable
remedies and (iii) the effect of general principles of equity, including
concepts of materiality, reasonableness, good faith and fair dealing, regardless
of whether considered in a proceeding in equity or at law), and no monetary or
other material default exists under any of them.
4.13 Litigation; Adverse Facts
Except as described in the Company's Annual Report on Form
10-K for the year ended December 31, 1995 or Quarterly Reports on Form 10-Q (or
Form 10-Q/A) for the first three quarters of 1996, there is no governmental
investigation of which the Company or any of its Subsidiaries has or could
reasonably be expected to have knowledge, and there is no action, suit,
proceeding, governmental arbitration
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(whether or not purportedly on behalf of the Company or any of its Subsidiaries)
at law or in equity or before or by any federal, state, municipal or
governmental department, court, tribunal, commission, board, bureau, agency or
instrumentality, domestic or foreign, threatened and about which the Company or
any of its Subsidiaries has or could reasonably be expected to have knowledge,
or pending against or affecting any the Company or any of its Subsidiaries or
any of their respective properties which in the aggregate have or, if determined
adversely to the Company or its Subsidiaries (except where, in the opinion of
the Company's counsel, an adverse determination is improbable), would have a
Material Adverse Effect. No such investigation, proceeding or matter is pending
or has been overtly threatened by any Gaming Authority which considers or seeks,
or (if adversely determined) might be expected to lead to, denial, revocation or
suspension of any Gaming License. Neither the Company nor any of its
Subsidiaries has received any notice of default under, or notice of termination
of, any material contract, lease or other agreement or suffered any material
damage, destruction or loss (whether or not covered by insurance) or had any
employee strike, work-stoppage, slow-down or lock-out or received any overt
threat thereof that in any case, individually or in the aggregate, would have or
could reasonably be expected to have a Material Adverse Effect.
4.14 Payment of Taxes
All tax returns and reports of the Company and each of its
Subsidiaries required to be filed by any of them have been duly and timely
filed. All taxes, assessments, fees and other governmental charges upon the
Company and each of its Subsidiaries and upon any of their respective
properties, income and franchises that are due and payable have been paid when
due and payable, and there is no tax assessment pending against any of them.
4.15 No Indenture Defaults; Main Street Option Agreement in Effect.
No Default or Indenture Event of Default has occurred at any
time since December 19, 1995. The Main Street Option Agreement has not been
amended since the date of the Indenture and remains in full force and effect and
Fitzgeralds Black Hawk, Inc. owns and holds all rights thereunder, subject to
the Liens created by the Collateral Documents. Fitzgeralds Black Hawk, Inc. owns
22% of the membership interests in Main Street, subject only to the Liens
created by the Collateral Documents. Such membership interests are duly issued,
fully paid and nonassessable.
4.16 Las Vegas and Tunica Expansions
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The Fitzgeralds Las Vegas Expansion and the Fitzgeralds Tunica
Expansion have been completed, except for punchlist items which require the
completion or correction of minor aspects of the construction work. Except for
the unpaid costs listed on Schedule 4.16(a), all Project Costs at any time
incurred for the Fitzgeralds Las Vegas Expansion and the Fitzgeralds Tunica
Expansion have been paid and appropriate lien waivers therefor have been
delivered by the payee. Except for the claims and liens described on Schedule
4.16(b), no mechanics or materialsmens liens have been filed against any
property that is part of Fitzgeralds Las Vegas or Fitzgeralds Tunica. There
remains available for funding of Project Costs the sum of $4,520,947 in cash in
reserve for payment of Project Costs.
4.17 Governmental Regulation
Neither the Company nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1934, the Federal
Power Act, or the Investment Company Act of 1940, each as amended, or to any
other foreign or domestic federal or state statute or regulation (including any
applicable laws or regulations under the Interstate Commerce Act) limiting its
ability to incur Indebtedness or to create Liens on any of its properties or
assets to secure debt, except gaming laws.
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4.18 Disclosure
The statements made in the Prospectus, in the Company's Annual
Report on Form 10-K for the year ended December 31, 1995 and Quarterly Reports
on Form 10-Q (or Form 10-Q/A) for the first three quarters of 1996, and in the
Company's Solicitation of Consents of Holders dated December 23, 1996 were true
in all material respects on the date such statements were made. No such
statements, and no other statement, representation or warranty of the Company or
any of its Subsidiaries contained in this Agreement, any Priority Notes Document
or any other document, certificate, schedule or other writing furnished to the
Purchasers at the Closing by or on behalf of the Company or any of its
Subsidiaries, contained or will contain any untrue statement of a material fact
or omitted to state a material fact at the time it was or is made or furnished,
as the case may be, necessary in order to make the statements contained herein
or therein not misleading in light of the circumstances in which the same were
or are made and, to the best knowledge of each of the Company, no such
representation or warranty contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements
contained herein or therein not misleading in light of the circumstances in
which the same were made. There is no fact known to the Company or any of its
Subsidiaries that has had, would have or could reasonably be expected to have a
Material Adverse Effect that has not been disclosed therein or herein.
4.19 Licenses, Permits and Authorizations
The Company and its Subsidiaries have all approvals, licenses
and other permits of all governmental or regulatory agencies, whether foreign,
domestic, federal, state or local, including Gaming Licenses, the absence of
which could materially impair the operations of any business of the Company or
any such Subsidiary as it is presently being conducted or would have or could
reasonably be expected to have a Material Adverse Effect.
4.20 Hazardous Materials
Neither the Company nor any of its Subsidiaries and, to the
best of their knowledge, after due inquiry, no predecessor in title to any of
their property, nor any third person at any time occupying, adjacent to or
present on any property owned or leased by any of them has at any time used,
generated, disposed of, discharged, stored, transported to or from, released or
threatened the release of any hazardous materials, in any form, quantity or
concentration, on, from, under or affecting such property, and no
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hazardous materials are present or existing on, from, under or affecting any
such property.
4.21 Margin Stock
None of the Collateral consists of "margin stock," and no
proceeds of the issuance and sale of the Priority Notes will be used to purchase
or carry "margin stock," as that term is defined in or for purposes of
Regulations G, T, U and X of the Board of Governors of the Federal Reserve
System.
4.22 Permitted Intercompany Notes
As of the Closing Date, (i) Fitzgeralds Las Vegas, Inc. is
indebted to the Company (without defense, offset or counterclaim) in a principal
amount of $43,998,501, which includes $16,000,000 in Permitted Intercompany
Loans made to Fitzgeralds Las Vegas, Inc. by funding disbursed from and
available for disbursement from the Las Vegas Collateral Account, and such
indebtedness is evidenced by that certain Permitted Intercompany Note dated
December 19, 1995 pledged to and held by the Trustee as part of the Priority
Notes Collateral and is secured by Liens upon the real and personal property
comprising the assets of Fitzgeralds Las Vegas (other than Excluded Assets)
which are held and enforceable by the Trustee as security for the Priority Note
Obligations on a first and prior basis, and (ii) Fitzgeralds Mississippi, Inc.
is indebted to the Company (without defense, offset or counterclaim) in a
principal amount of $70,875,828, which includes $34,000,000 in Permitted
Intercompany Loans made to Fitzgeralds Mississippi, Inc. by funding disbursed
from and available for disbursement from the Tunica Collateral Account, and such
indebtedness is evidenced by that certain Permitted Intercompany Note dated
December 19, 1995 pledged to and held by the Trustee as part of the Collateral
and is secured by Liens upon the real and personal property comprising the
assets of Fitzgeralds Tunica (other than Excluded Assets) which are held and
enforceable by the Trustee as security for the Priority Note Obligations on a
first and prior basis.
4.23 Brokers
The Company has not dealt with any broker, finder, commission
agent or other Person in connection with the sale of the Priority Notes and the
transactions contemplated by this Agreement and the Company is not under any
obligation to pay any broker's or finder's fee or commission or similar payment
in connection with such transactions. The Company has not paid and is not
obligated to pay any fee or compensation to any Person for soliciting the
consent of Holders to the First
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Supplemental Indenture. The Company agrees to indemnify and hold the Purchasers
harmless from and against any and all actions, suits, claims, costs, expenses,
losses, liabilities and obligations in connection with or relating to any
broker's or finder's fee or commission or similar payment in connection with
such transactions, except with respect to such fees or commissions contracted by
any Purchaser for its account.
4.24 Solvency
Neither the Company nor any of its Subsidiaries is or will be,
after giving effect to the issuance of the Priority Notes and the execution,
delivery and performance of the Priority Notes Documents, insolvent or left with
unreasonably small capital with which to engage in its anticipated business.
Based on Company management's reasonable future projections as to the financial
performance of the Company and its Subsidiaries, neither the Company nor any of
its Subsidiaries has, or will have after giving effect to the issuance of the
Priority Notes and the execution, delivery and performance of the Priority Notes
Documents, incurred debts beyond its ability to pay such debts as they mature.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF EACH PURCHASER
Each Purchaser represents and warrants to the Company,
severally as to such Purchaser only and not jointly with any other Purchaser,
that:
5.1 Purchase for Own Account
Such Purchaser or its Account Manager is purchasing the
Priority Notes to be purchased by it solely for such Purchaser's own account (or
in the case of Account Managers, on behalf of managed accounts) and not as
nominee or agent for any other person (other than for any such managed accounts)
and not with a view to, or for offer or sale in connection with, any
distribution thereof (within the meaning of the Securities Act) that would be in
violation of the securities laws of the United States of America or any state
thereof, without prejudice, however, to its right at all times to sell or
otherwise dispose of all or any part of the Priority Notes pursuant to a
registration statement under the Securities Act or pursuant to an exemption from
the registration requirements of the Securities Act, and subject, nevertheless,
to the disposition of its property being at all times within its control.
5.2 Accredited Investor
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Such Purchaser or such Account Manager is knowledgeable,
sophisticated and experienced in business and financial matters. It previously
invested in securities similar to the Priority Notes. It acknowledges that the
Priority Notes have not been registered under the Securities Act and understands
that the Priority Notes must be held indefinitely unless they are subsequently
registered under the Securities Act or such sale is permitted pursuant to an
available exemption from such registration requirement. It (or, in the case of
an Account Manager, the managed account on behalf of which the Account Manager
is acting) is able to bear the economic risk of its investment in the Priority
Notes and is presently able to afford the complete loss of such investment. It
is an "accredited investor" as defined in Regulation D promulgated under the
Securities Act. It has been afforded access to information about the Company's
financial condition, results of operations, business, property, management and
prospects sufficient to enable it to evaluate its investment in the Priority
Notes. Such Purchaser or such Account Manager acknowledges that it has conducted
its own analysis of the Company's financial condition and other foregoing
factors and such Purchaser has not relied upon the analysis of any other
Purchaser in determining to make an investment in the Priority Notes.
5.3 Authorization
Such Purchaser has taken all actions necessary to authorize it
(or, in the case of an Account Manager, such Account Manager is duly authorized
by the managed account for which it is acting) to execute, deliver and perform
its obligations under this Agreement. This Agreement is a legally valid and
binding obligation of each Purchaser enforceable against it in accordance with
its terms, except for (i) the effect thereon of bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or affecting the
rights of creditors generally, (ii) limitations imposed by federal or state law
or equitable principles upon the specific enforceability of any of the remedies,
covenants or other provisions thereof and upon the availability of injunctive
relief or other equitable remedies and (iii) the effect of general principles of
equity, including concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether considered in a proceeding in equity or at law.
SECTION 6. COVENANTS
The Company and each of the Subsidiary Guarantors covenant and
agree that, until Discharge of the Priority Obligations:
6.1 Additional Guarantors
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Whenever any Subsidiary of the Company which is not, on the
Closing Date, a Subsidiary Guarantor, becomes required (under the Indenture) to
execute and deliver an Addendum to Subsidiary Guarantee, such Subsidiary will at
the same time execute and deliver to the then registered holders of the Priority
Notes an addendum to this Agreement by which such Subsidiary guarantees the
Guaranteed Obligations as set forth in Section 7 (subject, in the case of Main
Street, to the provisions of Section 1309 of the Indenture) and agrees to be
bound by each and all of the representations, warranties, covenants and
obligations binding on a Subsidiary Guarantor hereunder. Such addendum shall be
accompanied (if and to the extent requested by any holder of Priority Notes) by
each and all of the documents and assurances delivered by or relating to such
Subsidiary which would have been required to be delivered at the Closing
pursuant to Section 3.1, if such Subsidiary Guarantor had been a Subsidiary
Guarantor on the Closing Date. After delivery of such addendum, the term
"Subsidiary Guarantor" shall extend to and include such Subsidiary.
6.2 Indenture Covenants
The Company and each Subsidiary Guarantor will duly and
punctually perform and observe each and all of the covenants, agreements and
obligations set forth in Article Eight, Article Ten, Article Twelve and Article
Sixteen of the Indenture, on the terms and conditions and in the form in effect
at the Closing Date without giving effect to any subsequent amendment thereto,
waiver thereunder or discharge thereof, except any amendment or waiver expressly
approved in writing in accordance with Section 9.
6.3 Note Documents
Neither the Company nor any Subsidiary Guarantor will agree to
any modification, amendment, termination, release or other discharge of or
change in the Indenture, the Collateral Documents or any other Note Documents
except upon express prior written consent of the Required Priority Noteholders,
given in accordance with Section 9.
6.4 Use of Proceeds
The proceeds of the Purchase Price will be delivered to and
used as set forth in the Receipt for Funding delivered pursuant to Section
3.1(i).
6.5 Waivers of Defenses and Setoff Rights
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Each of Fitzgeralds Las Vegas, Inc., Fitzgeralds Mississippi,
Inc. and any other Subsidiary Guarantor which is the obligor on a Permitted
Intercompany Note acknowledges and agrees that (for as long as the Permitted
Intercompany Notes are pledged to secure Priority Note Obligations or any
Secured Obligations) it will not plead, interpose or otherwise in any manner
assert or enforce any defense, setoff, counterclaim or any other right, claim or
interest enforceable by it against the Company or any of the Company's
Subsidiaries or Affiliates (whether based on a contract, tort, duty imposed by
law, fiduciary duty or other legal obligation or any other theory of liability
and whether related to any breach, crime, wrongful conduct or any other act,
omission, event or circumstance of any and every type and description whenever
occurring), in any action by the Trustee or Collateral Agent (or the successor
or transferee of either of them) to collect any Permitted Intercompany Note or
Permitted Intercompany Loan or to foreclose upon or enforce any Lien securing
any Permitted Intercompany Note or Permitted Intercompany Loan or in any other
action or proceeding (whether for declaratory judgment or otherwise) by or
against the Trustee or Collateral Agent (or any such successor or transferee) in
any manner relating to the Collateral or the foreclosure or enforcement of any
Lien thereon.
6.6 Private Placement Number
The Company consents to the filing of copies of this Agreement
with Standard & Poor's Corporation to obtain a private placement number and with
the National Association of Insurance Commissioners.
SECTION 7. GUARANTIES
7.1 Subsidiary Guaranties
The Subsidiary Guarantors unconditionally and jointly and
severally guaranty and promise to pay to the holders of Priority Note
Obligations and Senior Claims (each a "Beneficiary"), on demand made at any time
while any Event of Default is Continuing, in lawful money of the United States
of America, any and all Guaranteed Obligations of the Company from time to time
owed to the Beneficiaries. The term "Guaranteed Obligations" means any and all
present and future obligations and liabilities of the Company of every type and
description to the Beneficiaries under the Priority Notes, the Priority Notes
Agreenent or any of the other Priority Notes Documents, 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
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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 the Bankruptcy Code (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 Guaranteed Obligations shall be
conclusively presumed to have been created in reliance on the foregoing
guaranty, which is a continuing guaranty of the Guaranteed Obligations and,
except as otherwise provided in Section 1019(f) of the Indenture, may not be
revoked and shall not otherwise terminate unless and until any and all
Guaranteed Obligations have been indefeasibly paid and performed in full.
7.2 Nature of Guaranty
The liability of each Subsidiary Guarantor under Section 7.1
(or any addendum delivered by it pursuant to Section 6.1) is independent of and
not in consideration of or contingent upon the liability of the Company or any
other Obligor and a separate action or actions may be brought and prosecuted
against any Subsidiary Guarantor, whether or not any action is brought or
prosecuted against the Company or any other obligor or whether the Company or
any other obligor is joined in any such action or actions. The guaranty given by
each Subsidiary Guarantor pursuant to Section 7.1 (or such addendum) 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
Priority Notes, this Agreement or any other Priority Notes Document,
any of the Guaranteed Obligations, any Lien or Collateral or the
guaranty given by any other Subsidiary Guarantor;
(b) any defense (other than payment), set-off or
counterclaim that may at any time be available to the Company or any
other obligor against, and any right of setoff at any time held by, any
Beneficiary; or
(c) any other circumstance whatsoever (with or
without notice to or knowledge of any Subsidiary Guarantor or any other
obligor), 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 obligor, in bankruptcy or in any
other instance.
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Any payment by the Company or any Subsidiary Guarantor or any
other Person obligated in respect of any of the Guaranteed Obligations or any
other circumstance that operates to toll any statute of limitations applicable
to the Company, any Subsidiary Guarantor or any such other Person shall also
operate to toll the statute of limitations applicable to the Company and each
Subsidiary Guarantor.
7.3 Authorization
Each Subsidiary Guarantor authorizes each Beneficiary, without
notice to or further assent by such Subsidiary Guarantor, and without affecting
any Subsidiary Guarantor's liability hereunder (regardless of whether any
subrogation or similar right that such Subsidiary Guarantor may have or any
other right or remedy of such Subsidiary 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
Guaranteed 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 Guaranteed Obligations or any part thereof, consent or enter
into supplemental indentures or otherwise amend the terms and
conditions of the Priority Notes 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 Beneficiary
against the Company or any other obligor in respect of any Guaranteed
Obligations or any Collateral;
(d) release, add or settle with the Company, any
Subsidiary Guarantor or any other obligor in respect of any of the
Guaranteed Obligations or any guaranty thereof or other obligation in
respect thereof;
(e) accept partial payments on the Guaranteed
Obligations and apply any and all payments or recoveries from any
obligor or Collateral to such of
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the Guaranteed Obligations as any Beneficiary may elect in its sole
discretion, whether or not such Guaranteed Obligations are secured or
guaranteed;
(f) refund at any time, at such Beneficiary's
sole discretion, any payments or recoveries received by such
Beneficiary in respect of any Guaranteed Obligations or Collateral; and
(g) otherwise deal with the Company, any other
Subsidiary Guarantor, any other Person obligated in respect of the
Guaranteed Obligations and any Collateral as such Beneficiary may elect
in its sole discretion.
7.4 Certain Waivers
Each Subsidiary Guarantor waives:
(a) the right to require the Beneficiaries to
proceed against the Company, any other Subsidiary Guarantor or any
other Person obligated in respect of the Guaranteed Obligations or to
proceed against or exhaust any Collateral or to pursue any other remedy
in any Beneficiary's power whatsoever and the right to have the
property of the Company, any other Subsidiary Guarantor or any such
other obligor first applied to the discharge of the Guaranteed
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 Guaranteed Obligations or any Subsidiary Guarantor's
liability hereunder;
(d) any requirement of marshaling or any other
principle of election of remedies;
(e) any right to assert against any Beneficiary
any defense (legal or equitable), set-off, counterclaim and other right
that any Subsidiary Guarantor may now or any time hereafter have
against the Company, any other Subsidiary Guarantor or any such other
obligor;
(f) presentment, demand for payment or
performance (including diligence in making demands hereunder), notice
of dishonor or nonperformance,
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protest, acceptance and notice of acceptance of this Subsidiary
Guarantee, and, except to the extent expressly required by the Priority
Notes Documents, all other notices of any kind, including (i) notice of
any action taken or omitted by the Beneficiaries in reliance hereon,
(ii) notice of any default by the Company, any other Subsidiary
Guarantor or any such other obligor, (iii) notice that any portion of
the Guaranteed Obligations is due, (iv) notice of any action against
the Company, any other Subsidiary Guarantor or any such other obligor,
or any enforcement of other action with respect to any Collateral, or
the assertion of any right of any Beneficiary hereunder;
(g) all defenses that at any time may be
available to any Subsidiary Guarantor by virtue of any valuation, stay,
moratorium or other law now or hereafter in effect; and
(h) to the extent provided under Section 40.495
of Nevada Revised Statutes ("N.R.S."), the applicable provisions of
N.R.S. Section 40.430 and applicable laws of the State of Mississippi.
7.5 No Subrogation; Certain Agreements
(a) EACH SUBSIDIARY 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
BENEFICIARY MAY NOW OR HEREAFTER HAVE IN RESPECT OF THE GUARANTEED
OBLIGATIONS AGAINST THE COMPANY OR ANY OTHER OBLIGOR (OTHER THAN RIGHTS
OF CONTRIBUTION FROM OTHER SUBSIDIARY GUARANTORS), ANY AND ALL BENEFITS
OF AND RIGHTS TO PARTICIPATE IN ANY COLLATERAL, WHETHER REAL OR
PERSONAL PROPERTY, NOW OR HEREAFTER HELD BY ANY BENEFICIARY, AND ANY
AND ALL OTHER RIGHTS AND CLAIMS (AS DEFINED IN THE BANKRUPTCY CODE) ANY
SUBSIDIARY GUARANTOR MAY HAVE AGAINST THE COMPANY, UNDER APPLICABLE LAW
OR OTHERWISE, AT LAW OR IN EQUITY, BY REASON OF ANY PAYMENT UNDER THE
SUBSIDIARY GUARANTEE, UNLESS AND UNTIL THE GUARANTEED OBLIGATIONS SHALL
HAVE BEEN PAID IN FULL.
(b) Each Subsidiary Guarantor assumes the
responsibility for being and keeping itself informed of the financial
condition of the Company, each
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other Subsidiary Guarantor and each other Person at any time obligated
in respect of the Guaranteed Obligations and of all other circumstances
bearing upon the risk of nonpayment of the Guaranteed Obligations or
the Subsidiary Guarantee of any other Subsidiary Guarantor that
diligent inquiry would reveal, and agrees that the Beneficiaries shall
have no duty to advise any Subsidiary Guarantor of information
regarding such condition or any such circumstances.
7.6 Bankruptcy No Discharge
(a) Without limiting Section 7.2, the liability
of any Subsidiary Guarantor under Section 7.1 (or any addendum executed
and delivered by it pursuant to Section 6.1) shall not be discharged or
otherwise affected by any bankruptcy, reorganization or similar
proceeding commenced by or against the Company or any other Subsidiary
Guarantor or any other Person obligated in respect of the Guaranteed
Obligations, including (i) any discharge of, or bar or stay against
collecting, all or any part of the Guaranteed Obligations in or as a
result of any such proceeding, whether or not assented to by any
Beneficiary, (ii) any disallowance of all or any portion of any
Beneficiary's claim for repayment of the Guaranteed 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 Beneficiary to file or enforce a
claim against the Company, any Subsidiary Guarantor or any such other
obligor or its estate in any bankruptcy or reorganization case, (vi)
any amendment, modification, stay or cure of any Beneficiary's rights
that may occur in any such proceeding, (vii) any election by any
Beneficiary under Section 1111(b)(2) of the Bankruptcy Code, or (viii)
any borrowing or grant of a Lien under Section 364 of the Bankruptcy
Code. Each Subsidiary Guarantor understands and acknowledges that by
virtue of its guaranty of the Guaranteed Obligations, it has
specifically assumed any and all risks of any such proceeding with
respect to the Company, any other Subsidiary Guarantor or any such
other obligor.
(b) Notwithstanding anything in this Section 7
to the contrary, any Event of Default shall render all Guaranteed
Obligations automatically due and payable for purposes of the liability
of each Subsidiary Guarantor under Section 7.1 (or any addendum
executed and delivered by it pursuant to Section 6.1), without demand
on the part of any Beneficiary, the Trustee, the Collateral Agent or
any other Person.
(c) Notwithstanding anything to the contrary
herein contained, the liability of each Subsidiary Guarantor under
Section 7.1 (or any addendum
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executed and delivered by it pursuant to Section 6.1), and all Liens on
the Collateral securing the Guaranteed Obligations, shall continue to
be effective or be reinstated, as the case may be, if at any time (i)
any payment, or any part thereof, of any or all of the Guaranateed
Obligations is rescinded, invalidated, declared to be fraudulent or
preferential or otherwise required to be restored or returned by any
Beneficiary in connection with any bankruptcy, reorganization or
similar proceeding involving the Company, any other Subsidiary
Guarantor or any other Person or otherwise, (ii) the proceeds of any
Collateral are required to be returned by any Beneficiary under any
such circumstances, or (iii) any Beneficiary 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.
7.7 Severability of Void Obligations under Subsidiary Guarantee
The obligations of any Subsidiary Guarantor hereunder shall be
limited to the maximum amount that would not render its obligations hereunder
subject to avoidance under Section 548 of the Bankruptcy Code or any applicable
provisions of comparable state law.
7.8 Right of Contribution
In order to provide for just and equitable contribution among
the Subsidiary Guarantors in connection with their guaranties of the Guaranteed
Obligations, the Subsidiary Guarantors have agreed among themselves that if any
Subsidiary Guarantor satisfies some or all of the Guaranteed Obligations (a
"Funding Subsidiary Guarantor"), the Funding Subsidiary Guarantor shall be
entitled to contribution from the other Subsidiary Guarantors that have positive
Maximum Net Worth (as defined below) for all payments made by the Funding
Subsidiary Guarantor in satisfying the Guaranteed Obligations, so that each
Subsidiary Guarantor that remains obligated under the Subsidiary Guarantee at
the time that a Funding Subsidiary Guarantor makes such payment (a "Remaining
Subsidiary Guarantor") and has a positive Maximum Net Worth shall bear a portion
of such payment equal to the percentage that such Remaining Subsidiary
Guarantor's Maximum Net Worth bears to the aggregate Maximum Net Worth of all
Remaining Subsidiary Guarantors that have positive Maximum Net Worth.
As used herein, "Net Worth" means, with respect to any
Subsidiary Guarantor, the amount, as of any date of calculation, by which the
sum of a Person's assets (including subrogation, indemnity, contribution,
reimbursement and similar rights that such Subsidiary Guarantor may have),
determined on the basis of a "fair valuation" or their "fair salable value"
(whichever is the applicable test under Section 548 and other
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relevant provisions of the Bankruptcy Code and the relevant state fraudulent
conveyance or transfer laws) is greater than the amount that will be required to
pay all of such Person's debts, in each case matured or unmatured, contingent or
otherwise, as of the date of calculation, but excluding liabilities arising
under the Subsidiary Guarantee and excluding, to the maximum extent permitted by
Applicable Law with the objective of avoiding rendering such Person insolvent,
liabilities subordinated to the Guaranteed Obligations arising out of loans or
advances made to such Person by any other Person. "Maximum Net Worth" means,
with respect to any Subsidiary Guarantor, the greatest of the Net Worths
calculated as of the following dates: (A) the date on which the Subsidiary
Guarantor becomes a Subsidiary Guarantor hereunder, (B) the date on which such
Subsidiary Guarantor expressly reaffirms the Subsidiary Guarantee, (C) the date
on which demand for payment is made on such Subsidiary Guarantor hereunder, (D)
the date on which payment is made by such Subsidiary Guarantor hereunder or (E)
the date on which any judgment, order or decree is entered requiring such
Subsidiary Guarantor to make payment hereunder or in respect hereof. The meaning
of the terms "fair valuation" and "fair salable value" and the calculation of
assets and liabilities shall be determined and made in accordance with the
relevant provisions of the Bankruptcy Code and applicable state fraudulent
conveyance or transfer laws.
7.9 Additional Subsidiary Guarantors
Each Subsidiary of the Company that executes and delivers an
addendum pursuant to Section 6.1 shall be a Subsidiary Guarantor as if such
Subsidiary had been a signatory to this Agreement, and no such addendum must be
executed and delivered by any other Subsidiary Guarantor or any other Person.
Each of the Company and the Subsidiary Guarantors hereby consents to any such
addendum, whether or not it receives notice thereof.
SECTION 8. DEFAULTS AND REMEDIES
8.1 Events of Default
Each of the following occurrences shall constitute an Event of
Default:
(1) Any Indenture Event of Default occurs, whether or not such
Indenture Event of Default is effectively waived by or on behalf of the Trustee
or the Holders of Outstanding Notes.
(2) The Company fails to pay when due the principal of the
Priority Notes, or any interest thereon, or any mandatory prepayment required
under Section
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2.5(b), or any optional prepayment of which the Company has given notice
pursuant to Section 2.5(c).
(3) Any statement, representation or warranty made in Section
4 proves to have been inaccurate, untrue or misleading in any material respect
when it was made.
(4) A Subsidiary of the Company fails to execute and deliver
any addendum which it is required to execute and deliver pursuant to Section
6.1, and such failure continues for ten Business Days after notice thereof is
given to the Company and the Trustee.
(5) The Company or any Subsidiary Guarantor fails to perform
any obligation set forth in this Agreement (other than those referred to
elsewhere in this Section 8.1) and such failure continues for ten Business Days
after notice thereof is given to the Company and the Trustee.
(6) The Trustee or Collateral Agent fails to hold lawful,
enforceable, duly perfected first priority Liens, as first and prior security
for the Priority Note Obligations, on (i) the Permitted Intercompany Note issued
by Fitzgeralds Las Vegas, Inc., secured by Liens on all of its property (except
Excluded Assets) that are effectively reprioritized pursuant to Section 1202(b)
of the Indenture, (ii) the Permitted Intercompany Note issued by Fitzgeralds
Mississippi, Inc., secured by Liens on all of its property (other than Excluded
Assets) that are effectively reprioritized pursuant to Section 1202(b) of the
Indenture, (iii) all interest of Fitzgeralds Black Hawk, Inc. in the membership
interests in Main Street and under the Main Street Option Agreement, or (iv) any
other Collateral having a value in excess of $10,000,000, and such failure
continues for ten Business Days after notice thereof is given to the Company and
the Trustee.
(7) The guaranty given by any Subsidiary Guarantor in Section
7, or in an addendum to this Agreement delivered pursuant to Section 6.1, shall
be held invalid or unenforceable in any judicial proceedings, or the payment of
the Guaranteed Obligations under such guaranty in accordance with the terms of
Section 7 or such addendum shall for any reason cease to be valid and binding on
such Subsidiary Guarantor, or the validity or enforceability of such guaranty
shall be contested or disavowed by such Subsidiary Guarantor.
8.2 Acceleration
Upon and at any time after the occurrence of any Event of
Default, for as long as such Event of Default may be Continuing, the Required
Priority Noteholders may
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declare the Priority Notes to be immediately due and payable and thereupon (and,
in the case of any Event of Default consisting of the commencement or
continuation of any Bankruptcy, Insolvency or Liquidation Proceeding,
automatically and without any need for such declaration) the Priority Notes
shall immediately become and be fully due and payable, in an amount equal to the
then Accreted Value thereof, together with (i) all unpaid interest then accrued
thereon and (ii) additional interest then and thereafter accruing on such
Accreted Value at the Effective Equivalent Rate plus the Default Premium.
Each registered holder of any Priority Note may enforce
collection of the payment of such Priority Note or any Subsidiary Guarantor's
guarantee thereof by any lawful means, acting independently, whether or not
enforcement is also sought by any other holder.
8.3 Enforcement of Security
At any time after the Company fails to pay the Priority Notes
in full and in cash at their scheduled maturity or after the maturity of the
Priority Notes is accelerated pursuant to Section 8.2, the Required Priority
Noteholders may deliver to the Trustee or Collateral Agent such notice thereof
and such direction with respect to the foreclosure and enforcement of the Liens
securing Priority Note Obligations as may be permitted under the Indenture.
8.4 Right of Set-off
Whenever any Event of Default is Continuing, each beneficial
owner and each registered holder of any Priority Note (and each holder of a
participation or other interest therein) and each of their transferees and
successors shall have the right, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other liability at any time owing by
such owner, holder, participant, transferee or successor to or for the credit or
the account of the Company or any Subsidiary Guarantor against any and all
liability of the Company or such Subsidiary Guarantor for Priority Note
Obligations, whether or not any demand for payment has then been made or any
notice has then been given under this Agreement and whether or not such deposit
or liability is then due or unmatured. Prompt notice of any such setoff shall be
given by the Person effectuating such setoff to the Company and any affected
Subsidiary Guarantor, but the failure to give such notice shall not affect the
validity of such set-off and application. The rights of such owners, holders,
participants, transferees and successors under this Section 8.4 are in addition
to
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all other rights and remedies (including other rights of set-off) granted or
available to any of them.
8.5 Remedies Cumulative
Each right and remedy granted or available to any owner or
holder of Priority Notes upon the occurrence of an Event of Default may be
exercised and enforced either before or concurrently with or after, and
independently of, any exercise or enforcement of any other right or remedy of
any such owner or holder (or any holder of a participation) against any Person
or property. All such rights and remedies shall be cumulative, and no one of
them shall exclude or preclude any other.
SECTION 9. AMENDMENTS AND WAIVERS
This Agreement and the other Priority Notes Documents may not
be changed orally, but (subject to the provisions of this Section 9) only by an
agreement in writing signed by the party against whom enforcement of any waiver,
change, modification or discharge is sought. Any term, covenant, agreement or
condition of this Agreement or any of the other Priority Notes Documents may,
with the consent of the Company, be amended or compliance therewith may be
waived (either generally or in a particular instance and either retroactively or
prospectively), if the Company shall have obtained the consent in writing of the
Required Priority Noteholders and, in the case of any matter governed by clause
(iii) in Section 902(a) of the Indenture, the consent in writing of the holders
of at least 66 2/3% in principal amount of outstanding Priority Notes; provided,
however, that:
(a) Without the written consent of the holders of all
of Priority Notes then outstanding, no such amendment or waiver shall
be effective that (i) extends the time of payment or mandatory
prepayment on any Priority Note or changes the definition of "Accreted
Value" or reduces the principal amount or Accreted Value of any
Priority Note or the rate of interest thereon, (ii) alters any of the
prepayment provisions of Section 2.5, (iii) changes the currency in
which the Priority Notes are payable, (iv) directs the Trustee to
release or subordinate, or amends the Indenture or Priority Notes
Collateral Documents so as to release or subordinate, all or
substantially all of the Priority Notes Collateral, (v) changes the
definition of "Required Priority Noteholders" or (vi) alters the
provisions of this Section 9, and
(b) For the purposes of this Section 9 and the
definition of "Required Priority Noteholders," no Priority Note in
which the Company, any
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Subsidiary of the Company or any shareholder, director or Affiliate of
the Company or any Subsidiary of the Company owns any beneficial
interest shall be deemed (to the extent of such beneficial interest) to
be outstanding.
The Company shall promptly send copies of any request for
consent, amendment or waiver (and any request for any such amendment, consent or
waiver) relating to this Agreement or the Priority Notes to the registered
holder of each Priority Note. No waiver of any right or remedy hereunder shall
be effective unless in writing and then only with the written concurrence of the
Required Priority Noteholders or all holders as set forth above. No fee or other
consideration of any kind may be paid in connection with any amendment,
modification or waiver under any Priority Notes Document unless such fee or
other consideration is offered on a ratable basis to all holders of Priority
Notes who give their timely consent thereto.
Any such waiver shall be effective only in the specific
instance and for the specific purpose for which it was given. No course of
dealing between the Company and any holder and no failure to exercise or delay
in exercising any rights or remedies hereunder or under any Priority Note or any
other Priority Notes Document shall operate as a waiver of any rights or
remedies of any holder, and no single or partial exercise by any holder of any
right or remedy under this Agreement or any other Priority Notes Document shall
preclude any other or further exercise thereof or the exercise of any right or
remedy.
SECTION 10. MISCELLANEOUS
10.1 Survival of Representations and Warranties
All representations and warranties contained herein or made in
writing by or on behalf of the Company and the Subsidiary Guarantors in
connection herewith shall survive the execution and delivery of this Agreement,
the Priority Notes Documents and the Priority Notes, the transfer of any
Priority Notes or portion thereof or interest therein and the payment of any
Priority Note, and may be relied upon by the Purchasers, each present and future
holder of the Priority Notes and present and future owner of any beneficial
interest in the Priority Notes, regardless of any investigation made at any time
by or on behalf of the Purchasers or any holders of any Priority Note or any
beneficial interest therein.
10.2 Entire Agreement
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This Agreement, the Priority Notes and the other Priority
Notes Documents embody the entire agreement and understanding between the
parties hereto and supersede all prior agreements and understandings, if any,
relating to the subject matter hereof.
10.3 Successors and Assigns
All covenants and agreements in this Agreement and each other
Priority Notes Document by or on behalf of any of the parties hereto shall bind
and inure to the benefit of the respective successors and assigns of the parties
hereto (including all future holders of Priority Notes and owners of a
beneficial interest therein), whether so expressed or not; provided, however,
that the Company may not transfer or assign any of its rights or obligations
under this Agreement or any other Priority Notes Document (except in a
transaction permitted under Section 801 of the Indenture), without the prior
written consent of all holders of Priority Notes.
10.4 Disclosure to Other Persons
Each holder of Priority Notes agrees to hold in confidence and
not disclose any written information (other than information (i) that was
publicly known or otherwise known to such holder at the time of disclosure,
except pursuant to disclosure in connection with this Agreement, (ii) that
subsequently becomes publicly known through no act or omission by such holder,
or (iii) that otherwise becomes known to such holder, other than through
disclosure by the Company or any of its Subsidiaries) delivered or made
available by or on behalf of the Company or any of its Subsidiaries to such
holder in connection with or pursuant to this Agreement that is proprietary in
nature and clearly marked or labeled as being confidential information;
provided, however, that nothing herein shall prevent the holder of any Priority
Notes from delivering copies of any financial statements and other documents
delivered to such holder, and disclosing any other proprietary and confidential
information disclosed to such holder by or on behalf of the Company or any of
its Subsidiaries to (a) the owner of a beneficial interest in such holder's
Priority Notes, if bound in writing by the terms of this Section 10.4, (b) such
holder's or beneficial owner's directors, officers, employees, agents and
professional consultants, if so bound, (c) any other holder or beneficial owner
of any Priority Notes that is so bound, (d) any Person, so bound, to which such
holder or beneficial owner sells or offers to sell such Priority Notes or any
part thereof, (e) any Person, so bound, to which such holder or beneficial owner
sells or offers to sell a participation in all or any part of such Priority
Notes, (f) any federal or state regulatory authority having jurisdiction over
such holder, (g) the National Association of Insurance Commissioners or any
similar organization or (h) any other Person to which such delivery or
disclosure may be necessary or appropriate (1) in compliance with any law, rule,
regulation or order
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applicable to such holder, (2) in response to any subpoena or other legal
process, (3) in connection with any litigation to which such holder or
beneficial owner is a party or (4) in order to protect such holder's or
beneficial owner's investment in such Priority Notes.
10.5 Notices
All communications provided for hereunder shall be in writing
and sent by telecopier, certified or registered first class mail or nationwide
overnight delivery service (with charges prepaid) and (i) if to a Purchaser,
addressed to it at the address specified for such communications on the
Purchaser Schedule, or to such other address as such Purchaser may then most
recently have designated to the Company in writing, (ii) if to any other holder
of any Priority Notes, addressed to such holder at the registered address of
such holder as set forth in the register kept by the Company at its office as
provided in Section 2.3, and (iii) if to the Company or any Subsidiary of the
Company, addressed to it at 310 Fremont Street, Las Vegas, Nevada 89101
(telecopier number: (702) 382-5562), Attention: Chief Financial Officer.
10.6 Descriptive Headings
Descriptive headings of sections of this Agreement are for
convenience of reference only, do not constitute a part of this Agreement, and
shall not be used to construe, interpret, limit or expand the provisions herein.
10.7 Satisfaction Requirement
If any agreement, certificate or other writing, or any action
taken or to be taken, is by the terms of this Agreement required to be
satisfactory to any party, the determination of such satisfaction shall be made
by such party in its own independent judgment exercised in good faith and
without regard to what others may consider reasonable unless a different
standard is required by law or provided by agreement in any specific instance.
10.8 Independence of Covenants
All covenants hereunder shall be given independent effect.
10.9 Severability
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In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstances, is held invalid,
illegal or unenforceable in any respect for any reason, the validity, legality
and enforceability of any such provision in every other respect and of the
remaining provisions hereof shall not be in any way impaired or affected, it
being intended that all rights and privileges of each Purchaser and each other
holder of Priority Note Obligations shall be enforceable to the fullest extent
permitted by law.
10.10 Waiver of Jury Trial; Consent to Jurisdiction
TO THE FULLEST EXTENT PERMITTED BY LAW, EACH OF THE COMPANY,
SUBSIDIARY GUARANTORS AND PURCHASERS HEREBY IRREVOCABLY WAIVES ANY RIGHT TO A
TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF THIS AGREEMENT OR ANY
OTHER PRIORITY NOTES DOCUMENTS. EACH OF THE COMPANY, SUBSIDIARY GUARANTORS AND
PURCHASERS FURTHER IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS
TO SERVICE OF PROCESS BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED,
AGREES THAT ANY JUDICIAL PROCEEDING BROUGHT BY OR AGAINST THE COMPANY, ANY
SUBSIDIARY GUARANTOR OR ANY PURCHASER WITH RESPECT TO ANY OF THE PRIORITY NOTE
OBLIGATIONS, THIS AGREEMENT, ANY OTHER PRIORITY NOTES DOCUMENT OR ANY RELATED
AGREEMENT, BREACH, ACT, OMISSION, TRANSACTION OR EVENT MAY BE BROUGHT IN ANY
COURT OF COMPETENT JURISDICTION IN THE STATE OF NEW YORK, UNITED STATES OF
AMERICA, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, ACCEPTS FOR ITSELF
AND IN CONNECTION WITH ITS AND THEIR PROPERTIES, GENERALLY AND UNCONDITIONALLY,
THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND IRREVOCABLY AGREES TO
BE BOUND BY ANY FINAL, NON-APPEALABLE JUDGMENT RENDERED THEREBY. EACH OF THE
COMPANY, SUBSIDIARY GUARANTORS AND PURCHASERS FURTHER IRREVOCABLY WAIVES ANY
OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED IN THE AFORESAID
COURTS AND SHALL NOT ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OF VENUE
OR BASED UPON FORUM NON CONVENIENS. NOTHING HEREIN SHALL AFFECT THE RIGHT TO
SERVE PROCESS IN ANY MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE
COMPANY, SUBSIDIARY GUARANTORS AND PURCHASERS TO BRING PROCEEDINGS AGAINST THE
COMPANY, SUBSIDIARY GUARANTORS AND PURCHASERS IN THE COURTS OF ANY OTHER
JURISDICTION.
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10.11 Waiver of Claim for Special, Indirect, Consequential and Punitive Damages
Neither the Purchasers nor any of the Purchasers' affiliates,
Account Managers, directors, officers, employees, attorneys or agents shall ever
be liable under or in respect of this Agreement or any other Priority Notes
Document or the financing transactions contemplated hereby or any act, omission,
breach, tort, wrongful conduct, occurrence or event in any manner related
hereto, on any theory of liability (whether contract, tort, duty imposed by law,
or otherwise), for any special, indirect or consequential damages or, to the
fullest extent a claim for punitive damages may be waived by law, for punitive
damages, and the Company and each Subsidiary Guarantor hereby waive, release and
agree never to sue upon any claim for any such damages.
10.12 Governing Law
THIS AGREEMENT AND THE PRIORITY NOTES SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY,
THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW).
10.13 Counterparts
This Agreement and any amendments, waivers, consents, or
supplements hereto or hereunder may be executed in any number of counterparts,
and by different parties hereto or thereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument. This
Agreement shall become effective upon the execution and delivery of a
counterpart hereof by each of the parties hereto; provided, however, that any
Purchaser may deliver its counterpart signature page hereto by telecopy to the
special counsel to the Purchasers, which delivery shall be binding on such
Purchaser, and provided further, that any such Purchaser shall promptly provide
such special counsel with an adequate number (as determined by such special
counsel) of originally executed signature pages hereto.
44
<PAGE> 51
IN WITNESS WHEREOF, this Agreement has been duly executed by
the parties set forth below as of the date first written above.
FITZGERALDS GAMING CORPORATION, a Nevada corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS SOUTH, INC., a Nevada corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS RENO, INC., a Nevada corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS INCORPORATED, a Nevada corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
<PAGE> 52
FITZGERALDS LAS VEGAS, INC., a Nevada corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS FREMONT EXPERIENCE CORPORATION, a Nevada corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS MISSISSIPPI, INC., a Mississippi corporation
formerly known as Polk Landing Entertainment Corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS BLACK HAWK, INC., a Nevada corporation
By:
---------------------------------------------------
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
<PAGE> 53
THE NOTE PURCHASERS
TCW SHARED OPPORTUNITY FUND II, L.P.
By: TCW INVESTMENT MANAGEMENT COMPANY,
its Investment Advisor
By:
-----------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
JEFFERIES & COMPANY, INC.
By:
-----------------------------------
Name:
Title:
PUTNAM HIGH YIELD ADVANTAGE FUND
By:
-----------------------------------
Name:
Title:
<PAGE> 1
EXHIBIT 10.2
GLOBAL AMENDMENT TO COLLATERAL DOCUMENTS
This GLOBAL AMENDMENT TO COLLATERAL DOCUMENTS, dated as of
December 30, 1996 (this "Global Amendment"), is entered into by and among (i)
Fitzgeralds Gaming Corporation, a Nevada corporation (the "Company"), (ii)
Fitzgeralds South, Inc., a Nevada corporation, Fitzgeralds Reno, Inc., a Nevada
corporation, Fitzgeralds Incorporated, a Nevada corporation, Fitzgeralds Las
Vegas, Inc., a Nevada corporation, Fitzgeralds Fremont Experience Corporation,
a Nevada corporation, Fitzgeralds Mississippi, Inc. (formerly named Polk
Landing Entertainment Corporation), a Mississippi corporation, and Fitzgeralds
Black Hawk, Inc., a Nevada corporation (collectively, the "Subsidiary
Guarantors"), (iii) Wells Fargo Bank, N.A., formerly First Interstate Bank of
Nevada, N.A., not in its individual capacity but solely as indenture trustee
under the Indenture hereinafter described (the "Indenture Trustee"), and (iv)
Wells Fargo Bank, N.A., formerly First Interstate Bank of Nevada, N.A., not in
its individual capacity but solely as collateral agent under the Collateral
Documents hereinafter described (the "Collateral Agent").
Recitals
A. The Company has issued $123,000,000 in aggregate
outstanding principal amount of the Company's 13% Senior Secured Notes Due 2002
With Contingent Interest (the "1995 Secured Notes") pursuant to an Indenture
dated as of December 19, 1995 entered into by and among the Company, the
Subsidiary Guarantors and First Interstate Bank of Nevada, N.A., as trustee
(the "Indenture").
B. The Subsidiary Guarantors are direct or indirect
subsidiaries of the Company and have guaranteed payment of the 1995 Secured
Notes pursuant to the Indenture (the "Subsidiary Guarantee").
C. The 1995 Secured Notes, the Subsidiary Guarantee and
certain other secured obligations (the "Secured Obligations") are secured by
liens granted to the Indenture Trustee and the Collateral Agent by the Company
and the Subsidiary Guarantors pursuant to the instruments and agreements listed
on Schedule A attached hereto (the "Collateral Documents").
D. The Company proposes to issue Priority Secured Notes
due December 31, 1998 (the "Priority Notes"), for a discount purchase
consideration on terms and conditions set forth in the Note Purchase Agreement
dated as of December 30, 1996 (the "Priority Notes Agreement") among the
Company, the Subsidiary Guarantors and the purchasers listed on the signature
pages thereto.
<PAGE> 2
E. The Priority Notes will be guaranteed by the
Subsidiary Guarantors pursuant to the Priority Notes Agreement.
F. It is a condition to the issuance and sale of the
Priority Notes pursuant to the Priority Notes Agreement that the Priority Notes
and certain other related obligations be secured by liens granted to the
Indenture Trustee and the Collateral Agent under the Collateral Documents,
which shall secure the Priority Notes and such other obligations in preference
and priority over the 1995 Secured Notes, the Subsidiary Guarantee and such
other Secured Obligations.
G. In order to accomplish the foregoing, the holders of
all outstanding 1995 Secured Notes have consented to, and the Company, the
Subsidiary Guarantors and Indenture Trustee have executed and delivered, a
First Supplemental Indenture dated as of December 30, 1996 (the "First
Supplemental Indenture"), and the Company, the Subsidiary Guarantors, the
Indenture Trustee and the Collateral Agent are executing this Global Amendment.
NOW THEREFORE, in consideration of the premises, to induce the
holders of the Priority Notes to purchase the Priority Notes and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company, the Subsidiary Guarantors, the Indenture Trustee and
the Collateral Agent hereby agree for the direct, intended and legally
enforceable benefit of the present and future holders of Priority Note
Obligations (as defined in the First Supplemental Indenture) and each other
present and future holder of any Senior Claim (as defined in the First
Supplemental Indenture) as follows:
PART I
AMENDMENT OF THE COMPANY PLEDGE AGREEMENT
The Company Pledge Agreement is hereby amended as follows:
1. THE PREAMBLE TO THE COMPANY PLEDGE AGREEMENT IS
HEREBY AMENDED BY INSERTING, IN THE SIXTH LINE THEREOF IMMEDIATELY FOLLOWING
THE WORDS "(THE "HOLDERS")", THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, HOLDERS OF PRIORITY NOTE OBLIGATIONS".
2. THE COMPANY PLEDGE AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL A THE FOLLOWING NEW RECITAL B:
"B. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
2
<PAGE> 3
3. RECITAL B TO THE COMPANY PLEDGE IS HEREBY AMENDED BY
REDESIGNATING SUCH RECITAL AS RECITAL C.
4. RECITAL C TO THE COMPANY PLEDGE AGREEMENT IS HEREBY
AMENDED BY:
(i) redesignating such Recital as Recital D;
(ii) inserting, in the first line thereof immediately
following the words "under the Indenture", the words "and to the issuance and
sale of the Priority Notes under the Priority Notes Agreement"; and
(iii) deleting, in the third line thereof, the words "and
the Holders" and substituting in lieu thereof the words ", the Holders and,
until Discharge of the Priority Obligations, the holders of the Priority Note
Obligations".
5. THE COMPANY PLEDGE AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL D (AS REDESIGNATED) THE FOLLOWING NEW
RECITAL E:
"E. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all other Priority Note Obligations
(as defined therein) are to be secured by first and prior liens on all
collateral security granted herein."
6. SECTION 1.1. OF THE COMPANY PLEDGE AGREEMENT IS
HEREBY AMENDED BY INSERTING, IN THE SECOND LINE OF THE FIRST PARAGRAPH THEREOF
IMMEDIATELY FOLLOWING THE WORDS "THE INDENTURE", THE WORDS ", AS AMENDED BY THE
FIRST SUPPLEMENTAL INDENTURE".
7. SECTION 2.2. OF THE COMPANY PLEDGE AGREEMENT IS
HEREBY AMENDED BY:
(i) deleting the word "or" in the last line of Section
2.2.1. thereof;
(ii) inserting the following new Section 2.2.2.:
"2.2.2. arising under or in connection with the Priority
Notes or the Priority Notes Agreement, whether for principal (or
premium, if any) or interest (including accretion of original issue
discount and any applicable post-default rate) on the Priority Notes,
all guaranties thereof made by any Subsidiary Guarantors, and all
obligations of the Company or any Subsidiary
3
<PAGE> 4
Guarantor for fees, expense reimbursement, compensation,
indemnification or other similar obligations at any time arising or
accruing under the Priority Notes Agreement; or", and
(iii) redesignating the existing Section 2.2.2. as Section
2.2.3.
8. SECTION 4.7.1.1. OF THE COMPANY PLEDGE AGREEMENT IS
HEREBY AMENDED BY DELETING, IN THE THIRD FROM THE LAST LINE THEREOF, THE WORDS
"THE NOTES, THE INDENTURE" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "THE
NOTES, THE PRIORITY NOTES, THE INDENTURE (AS AMENDED BY THE FIRST SUPPLEMENTAL
INDENTURE), THE PRIORITY NOTES AGREEMENT".
9. SECTION 5.3.1. OF THE COMPANY PLEDGE AGREEMENT IS
HEREBY AMENDED BY:
(i) deleting, from the end of the second line of Section
5.3.1.1., the word "and"; and
(ii) deleting Section 5.3.1.2. in its entirety and
inserting in lieu thereof the following new Sections 5.3.1.2. and 5.3.1.3.:
"5.3.1.2. second, to pay the Priority Note Obligations and
Senior Claims as set forth in Section 506 of the Indenture, as amended
by the First Supplemental Indenture; and
5.3.1.3. third, to pay the other Secured Obligations in the
order set forth in the Indenture."
PART II
AMENDMENT OF THE SUBSIDIARY PLEDGE AGREEMENT
The Subsidiary Pledge Agreement is hereby amended as follows:
1. THE PREAMBLE TO THE SUBSIDIARY PLEDGE AGREEMENT IS
HEREBY AMENDED BY INSERTING, IN THE NINTH LINE THEREOF IMMEDIATELY FOLLOWING
THE WORDS (THE "HOLDERS"), THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, HOLDERS OF PRIORITY NOTE OBLIGATIONS".
2. THE SUBSIDIARY PLEDGE AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL B THE FOLLOWING NEW RECITAL C:
4
<PAGE> 5
"C. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
3. THE SUBSIDIARY PLEDGE AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL C (AS REDESIGNATED) THE FOLLOWING NEW
RECITAL D:
"D. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all other Priority Note Obligations
(as defined therein) are to be secured by first and prior liens on all
collateral security granted herein."
4. RECITALS C THROUGH F TO THE SUBSIDIARY PLEDGE
AGREEMENT ARE HEREBY AMENDED BY REDESIGNATING SUCH RECITALS AS RECITALS E
THROUGH H, RESPECTIVELY.
5. RECITAL E (AS REDESIGNATED) TO THE SUBSIDIARY PLEDGE
AGREEMENT IS HEREBY AMENDED BY:
(i) by inserting, in the first line thereof immediately
following the words "the Indenture", the words "and in the Priority Notes
Agreement"; and
(ii) deleting, in the third line thereof, the words "the
Notes, the Indenture" and substituting in lieu thereof the words "the Notes,
the Priority Notes, the Indenture (as amended by the First Supplemental
Indenture), the Priority Notes Agreement".
6. SECTION 1.1. OF THE SUBSIDIARY PLEDGE AGREEMENT IS
HEREBY AMENDED BY:
(i) inserting, in the second line of the first paragraph
thereof immediately following the words "the Indenture", the words ", as
amended by the First Supplemental Indenture";
(ii) inserting, in the first line of the definition of
"Applicable Priority" immediately following the word "means,", the words
"subject in each case to the priority of the Superpriority Lien,";
(iii) inserting, in appropriate alphabetical order, the
following new definitions:
5
<PAGE> 6
""PRIORITY NOTE OBLIGATIONS" has the meaning set forth in
Section 2.2.
"SUPERPRIORITY LIEN" has the meaning set forth in Section
2.3"; and
(iv) deleting the definition of "Secured Parties" in its
entirety and substituting in lieu thereof the following new definition:
""SECURED PARTIES" means, collectively, the Collateral Agent,
the Trustee, the Holders, and until Discharge of the Priority
Obligations, the holders of Priority Note Obligations, and, solely
with respect to the Senior Lien, Fitzgeralds, and the respective
successors and permitted assigns of such Persons."
7. SECTION 2.1. OF THE SUBSIDIARY PLEDGE AGREEMENT IS
HEREBY AMENDED BY DELETING, IN THE FOURTH LINE THEREOF, THE WORDS "AND THE
HOLDERS" AND SUBSTITUTING IN LIEU THEREOF THE WORDS ", THE HOLDERS AND, UNTIL
DISCHARGE OF THE PRIORITY OBLIGATIONS, THE HOLDERS OF THE PRIORITY NOTE
OBLIGATIONS".
8. SECTION 2.2.1. OF THE SUBSIDIARY PLEDGE AGREEMENT IS
HEREBY AMENDED BY:
(i) inserting the following new Sections 2.2.1.1. and
2.2.1.2.:
"2.2.1.1. with respect to each Pledgor, the due and punctual
payment and performance of any and all present and future obligations
and liabilities of such Pledgor of every type or description arising
under or in connection with the Priority Notes or the Priority Notes
Agreement, whether for principal (or premium, if any) or interest
(including accretion of original issue discount and any applicable
post-default rate) on the Priority Notes, all guaranties thereof made
by any Subsidiary Guarantors, and all obligations of the Company or
any Subsidiary Guarantor for fees, expense reimbursement,
compensation, indemnification or other similar obligations at any time
arising or accruing under the Priority Notes Agreement (collectively,
the "Priority Note Obligations");
2.2.1.2. with respect to each Pledgor, the due and punctual
payment and performance of any and all present and future obligations
and liabilities of such Pledgor of every type or description to
Fitzgeralds (the assigns of which shall include the Collateral Agent,
as agent for the Trustee, the Holders and, until Discharge of the
Priority Obligations, the holders of the Priority Note Obligations,
pursuant to the Company Pledge Agreement), arising under or in
connection with any Permitted Intercompany Note signed by it or any
Permitted
6
<PAGE> 7
Intercompany Loan evidenced thereby, whether for principal thereof, or
premium, if any, or interest thereon, indemnities or other amounts
(including attorneys' fees and expenses) (collectively, the "Permitted
Intercompany Loan Obligations");"
(ii) renumbering the existing Section 2.2.1.1. as Section
2.2.1.3., deleting the existing Section 2.2.1.2. and renumbering the existing
Section 2.2.1.3. as Section 2.2.1.4;
(iii) by inserting, in the third from last line thereof
immediately following the words "without limitation,", the words "the Priority
Note Obligations"; and
(iv) by inserting at the end of the last line thereof the
following new language:
"Notwithstanding anything to the contrary in this Agreement,
including, without limitation, Section 2.3, until Discharge of the
Priority Obligations, the Liens held by the Collateral Agent hereunder
as security for the Secured Obligations shall secure, in order of
preference and priority, first, the Priority Note Obligations, second,
the Permitted Intercompany Loan Obligations, and, third, the
Subsidiary Guarantee Obligations."
9. SECTION 2.3. OF THE SUBSIDIARY PLEDGE AGREEMENT IS
HEREBY AMENDED BY:
(i) deleting, in the first line thereof, the words "With
respect" and substituting in lieu thereof the words "Subject to the last
sentence of Section 2.2.1., with respect";
(ii) deleting, in the fourth line thereof, the words
"Permitted Intercompany Loan Obligations" and substituting in lieu thereof the
words "Subsidiary Guarantee Obligations";
(iii) deleting, in the sixth line thereof, the words
"Subsidiary Guarantee Obligations" and substituting in lieu thereof the words
"Permitted Intercompany Loan Obligations"; and
(iv) deleting the last sentence thereof in its entirety
and substituting in lieu thereof the following new sentence:
"The parties hereto intend that the Security Interest granted by each
Pledgor to the Collateral Agent as security for the Priority Note
Obligations (the "Superpriority Lien") shall at all times be separate
and apart from the Junior
7
<PAGE> 8
Lien and the Senior Lien, notwithstanding that the holder of all such
Liens may be the Collateral Agent, and that such Liens shall not be
merged."
10. SECTION 5.3.1. OF THE SUBSIDIARY PLEDGE AGREEMENT IS
HEREBY AMENDED BY DELETING SECTIONS 5.3.1.2. AND 5.3.1.3. IN THEIR ENTIRETY AND
SUBSTITUTING IN LIEU THEREOF THE FOLLOWING NEW SECTIONS:
"5.3.1.2. second, to pay the Priority Note Obligations and
Senior Claims as set forth in Section 506 of the Indenture, as amended
by the First Supplemental Indenture;
5.3.1.3. third, to pay accrued interest on and principal of
Permitted Intercompany Notes; and
5.3.1.4. fourth, to pay the other Subsidiary Guarantee
Obligations in the order set forth in the Indenture (as amended by the
First Supplemental Indenture) with respect to the obligations of
Fitzgeralds underlying such obligations."
Section 5.3.4. of the Subsidiary Pledge Agreement is hereby
amended by deleting, in the fourth line thereof, the words "and Holders" and
substituting in lieu thereof the words ", Holders and, until Discharge of the
Priority Obligations, holders of the Priority Note Obligations".
PART III
AMENDMENT OF THE COMPANY SECURITY AGREEMENT
The Company Security Agreement is hereby amended as follows:
1. THE PREAMBLE TO THE COMPANY SECURITY AGREEMENT IS
HEREBY AMENDED BY INSERTING, IN THE SIXTH LINE THEREOF IMMEDIATELY FOLLOWING
THE WORDS "(THE "HOLDERS")", THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, THE HOLDERS OF PRIORITY NOTE OBLIGATIONS".
2. THE COMPANY SECURITY AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL A THE FOLLOWING NEW RECITAL B:
"B. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
8
<PAGE> 9
3. THE COMPANY SECURITY AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL B (AS REDESIGNATED) THE FOLLOWING NEW
RECITAL C:
"C. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all other Priority Note Obligations
(as defined therein) are to be secured by first and prior liens on all
collateral security granted herein."
4. RECITAL B OF THE COMPANY SECURITY AGREEMENT IS HEREBY
AMENDED BY:
(i) redesignating such Recital as Recital D;
(ii) inserting, in the first line thereof immediately
following the words "under the Indenture", the words "and to the issuance of
the Priority Notes under the Priority Notes Agreement"; and
(iii) deleting, in the third line thereof, the words "and
the Holders" and substituting in lieu thereof the words ", the Holders and,
until Discharge of the Priority Obligations, the holders of the Priority Note
Obligations".
5. SECTION 1.1. OF THE COMPANY SECURITY AGREEMENT IS
HEREBY AMENDED BY INSERTING, IN THE SECOND LINE OF THE FIRST PARAGRAPH THEREOF
IMMEDIATELY FOLLOWING THE WORDS "THE INDENTURE", THE WORDS ", AS AMENDED BY THE
FIRST SUPPLEMENTAL INDENTURE".
6. SECTION 2.2. OF THE COMPANY SECURITY AGREEMENT IS
HEREBY AMENDED BY:
(i) deleting the word "or" in the last line of Section
2.2.1. thereof;
(ii) inserting the following new Section 2.2.2.:
"2.2.2. arising under or in connection with the Priority
Notes or the Priority Notes Agreement, whether for principal of or
premium (if any) or interest (including accretion of original issue
discount and any applicable post-default rate) on the Priority Notes,
all guaranties thereof made by any Subsidiary Guarantors, and all
obligations of the Company or any Subsidiary Guarantor for fees,
expense reimbursement, compensation, indemnification or other similar
obligations at any time arising or accruing under the Priority Notes
Agreement; or", and
9
<PAGE> 10
(iii) renumbering the existing Section 2.2.2. as Section
2.2.3.
7. SECTION 5.3.1. OF THE COMPANY SECURITY AGREEMENT IS
HEREBY AMENDED BY:
(i) deleting, from the end of the second line of Section
5.3.1., the word "and"; and
(ii) deleting Section 5.3.1.2. in its entirety and
substituting in lieu thereof the following new Sections 5.3.1.2. and 5.3.1.3.:
"5.3.1.2. second, to pay the Priority Note Obligations and
Senior Claims as set forth in Section 506 of the Indenture, as amended
by the First Supplemental Indenture; and
5.3.1.3. third, to pay the other Secured Obligations in the
order set forth in the Indenture."
PART IV
AMENDMENT OF THE SUBSIDIARY SECURITY AGREEMENT
The Subsidiary Security Agreement is hereby amended as
follows:
1. THE PREAMBLE TO THE SUBSIDIARY SECURITY AGREEMENT IS
HEREBY AMENDED BY INSERTING, IN THE EIGHTH LINE THEREOF IMMEDIATELY FOLLOWING
THE WORDS "(THE "HOLDERS")", THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, HOLDERS OF PRIORITY NOTE OBLIGATIONS".
2. THE SUBSIDIARY SECURITY AGREEMENT IS HEREBY AMENDED
BY INSERTING IMMEDIATELY FOLLOWING RECITAL B THE FOLLOWING NEW RECITAL C:
"C. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
3. THE SUBSIDIARY SECURITY AGREEMENT IS HEREBY AMENDED
BY INSERTING IMMEDIATELY FOLLOWING RECITAL C (AS REDESIGNATED) THE FOLLOWING
NEW RECITAL D:
"D. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors
10
<PAGE> 11
and Wells Fargo Bank, N.A., as successor Trustee, such Priority Notes
and all other Priority Note Obligations (as defined therein) are to be
secured by first and prior liens on all collateral security granted
herein."
4. RECITAL C TO THE SUBSIDIARY SECURITY AGREEMENT IS
HEREBY AMENDED BY:
(i) redesignated such Recital as Recital E;
(ii) inserting, in the first line thereof immediately
following the words "in the Indenture", the words "and in the Priority Notes
Agreement"; and
(iii) deleting, in the third line thereof, the words
"Notes, the Indenture" and substituting in lieu thereof the words "Notes, the
Priority Notes, the Indenture (as amended by the First Supplemental Indenture),
the Priority Notes Agreement".
5. RECITALS D THROUGH G TO THE SUBSIDIARY SECURITY
AGREEMENT ARE HEREBY REDESIGNATED AS RECITALS F THROUGH I, RESPECTIVELY.
6. RECITAL H (AS REDESIGNATED) TO THE SUBSIDIARY
SECURITY AGREEMENT IS HEREBY AMENDED BY DELETING, IN THE FIFTH LINE THEREOF,
THE WORDS "THE NOTES, THE INDENTURE" AND SUBSTITUTING IN LIEU THEREOF THE WORDS
"THE NOTES, THE PRIORITY NOTES, THE INDENTURE (AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE), THE PRIORITY NOTES AGREEMENT".
7. SECTION 1.1. OF THE SUBSIDIARY SECURITY AGREEMENT IS
HEREBY AMENDED BY:
(i) inserting, in the second line of the first paragraph
thereof immediately following the words "the Indenture", the words ", as
amended by the First Supplemental Indenture";
(ii) by inserting, in the first line of the definition of
"Applicable Priority" immediately following the word "means,", the words
"subject in each case to the priority of the Superpriority Lien,";
(iii) inserting, in appropriate alphabetical order, the
following new definitions:
""PRIORITY NOTE OBLIGATIONS" has the meaning set forth in
Section 2.2.
"SUPERPRIORITY LIEN" has the meaning set forth in Section 2.3"; and
11
<PAGE> 12
(iv) deleting the definition of "Secured Parties" in its
entirety and substituting in lieu thereof the following new definition:
""SECURED PARTIES" means, collectively, the Collateral Agent,
the Trustee, the Holders, and until Discharge of the Priority
Obligations, the holders of Priority Note Obligations, and, solely
with respect to the Senior Lien, Fitzgeralds, and the respective
successors and permitted assigns of such Persons."
8. SECTION 2.2.1. OF THE SUBSIDIARY SECURITY AGREEMENT
IS HEREBY AMENDED BY:
(i) inserting the following new Sections 2.2.1.1. and
2.2.1.2.:
"2.2.1.1. with respect to each Grantor, the due and punctual
payment and performance of any and all present and future obligations
and liabilities of such Grantor of every type or description arising
under or in connection with the Priority Notes or the Priority Notes
Agreement, whether for principal (or premium, if any) or interest
(including accretion of original issue discount and any applicable
post-default rate) on the Priority Notes, all guaranties thereof made
by any Subsidiary Guarantors, and all obligations of the Company or
any Subsidiary Guarantor for fees, expense reimbursement,
compensation, indemnification or other similar obligations at any time
arising or accruing under the Priority Notes Agreement (collectively,
the "Priority Note Obligations");
2.2.1.2. with respect to each Grantor, the due and punctual
payment and performance of any and all present and future obligations
and liabilities of such Grantor of every type or description to
Fitzgeralds (the assigns of which shall include the Collateral Agent,
as agent for the Trustee, the Holders and, until Discharge of the
Priority Obligations, the holders of the Priority Note Obligations,
pursuant to the Company Pledge Agreement), arising under or in
connection with any Permitted Intercompany Note signed by it or any
Permitted Intercompany Loan evidenced thereby, whether for principal
thereof, or premium, if any, or interest thereon, indemnities or other
amounts (including attorneys' fees and expenses) (collectively, the
"Permitted Intercompany Loan Obligations");"
(ii) renumbering the existing Section 2.2.1.1. as Section
2.2.1.3., deleting the existing Section 2.2.1.2. and renumbering the existing
Section 2.2.1.3. as Section 2.2.1.4;
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(iii) by inserting, in the third from last line thereof
immediately following the words "without limitation,", the words "the Priority
Note Obligations,"; and
(iv) by inserting at the end of the last line thereof the
following new language:
"Notwithstanding anything to the contrary in this Agreement,
including, without limitation, Section 2.3, until Discharge of the
Priority Obligations, the Liens held by the Collateral Agent hereunder
as security for the Secured Obligations shall secure, in order of
preference and priority, first, the Priority Note Obligations, second,
the Permitted Intercompany Loan Obligations, and, third, the
Subsidiary Guarantee Obligations."
9. SECTION 2.3. OF THE SUBSIDIARY SECURITY AGREEMENT IS
HEREBY AMENDED BY:
(i) deleting, in the first line thereof, the words "With
respect" and substituting in lieu thereof the words "Subject to the last
sentence of Section 2.2.1., with respect";
(ii) deleting, in the third line thereof, the words
"Permitted Intercompany Loan Obligations" and substituting in lieu thereof the
words "Subsidiary Guarantee Obligations";
(iii) deleting, in the sixth line thereof, the words
"Subsidiary Guarantee Obligations" and substituting in lieu thereof the words
"Permitted Intercompany Loan Obligations"; and
(iv) deleting the last sentence thereof in its entirety
and substituting in lieu thereof the following new sentence:
"The parties hereto intend that the Security Interest granted by each
Grantor to the Collateral Agent as security for the Priority Note
Obligations (the "Superpriority Lien") shall at all times be separate
and apart from the Junior Lien and the Senior Lien, notwithstanding
that the holder of all such Liens may be the Collateral Agent, and
that such Liens shall not be merged."
Section 3.2. of the Subsidiary Security Agreement is hereby
amended by inserting, in the ninth line thereof immediately following the words
"each other Note", the word "Document".
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10. SECTION 5.3.1. OF THE SUBSIDIARY SECURITY AGREEMENT
IS HEREBY AMENDED BY DELETING SECTIONS 5.3.1.2. AND 5.3.1.3. IN THEIR ENTIRETY
AND SUBSTITUTING IN LIEU THEREOF THE FOLLOWING NEW SECTIONS:
"5.3.1.2. second, to pay the Priority Note Obligations and
Senior Claims as set forth in Section 506 of the Indenture, as amended
by the First Supplemental Indenture;
5.3.1.3. third, to pay accrued interest on and principal of
Permitted Intercompany Notes; and
5.3.1.4. fourth, to pay the Subsidiary Guarantee Obligations
in the order set forth in the Indenture with respect to the
obligations of Fitzgeralds underlying such obligations."
Section 5.3.4. of the Subsidiary Security Agreement is hereby
amended by deleting, in the fourth line thereof, the words "and Holders" and
substituting in lieu thereof the words ", Holders and, until Discharge of the
Priority Obligations, holders of the Priority Note Obligations".
PART V
AMENDMENT OF THE COMPANY ACCOUNTS PLEDGE AGREEMENT
The Company Accounts Pledge Agreement is hereby amended as
follows:
1. THE PREAMBLE TO THE COMPANY ACCOUNTS PLEDGE AGREEMENT
IS HEREBY AMENDED BY INSERTING, IN THE SIXTH LINE THEREOF IMMEDIATELY FOLLOWING
THE WORDS "(THE "HOLDERS")", THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, HOLDERS OF THE PRIORITY NOTE OBLIGATIONS".
2. THE COMPANY ACCOUNTS PLEDGE AGREEMENT IS HEREBY
AMENDED BY INSERTING IMMEDIATELY FOLLOWING RECITAL D THE FOLLOWING NEW RECITAL
E:
"E. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
3. THE COMPANY ACCOUNTS PLEDGE AGREEMENT IS HEREBY
AMENDED BY INSERTING IMMEDIATELY FOLLOWING RECITAL E (AS REDESIGNATED) THE
FOLLOWING NEW RECITAL F:
"F. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First
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Supplemental Indenture") by and among the Pledgor, the Subsidiary
Guarantors and Wells Fargo Bank, N.A., as successor Trustee, such
Priority Notes and all other Priority Note Obligations (as defined
therein) are to be secured by first and prior liens on all collateral
security granted herein."
4. RECITAL E TO THE COMPANY ACCOUNTS PLEDGE AGREEMENT IS
HEREBY AMENDED BY REDESIGNATING SUCH RECITAL AS RECITAL G.
5. SECTION 1.1. OF THE COMPANY ACCOUNTS PLEDGE AGREEMENT
IS HEREBY AMENDED BY:
(i) inserting, in the third line of the first paragraph
thereof immediately following the words "the Indenture", the words ", as
amended by the First Supplemental Indenture"; and
(ii) deleting, in the first line of the definition of
"Secured Parties", the words "and the Holders of the Notes" and substituting in
lieu thereof the words ", the Holders of the Notes and, until Discharge of the
Priority Obligations, the holders of the Priority Note Obligations".
6. SECTION 2.1. OF THE COMPANY ACCOUNTS PLEDGE AGREEMENT
IS HEREBY AMENDED BY:
(i) deleting the word ";or" in the last line of Section
2.1.1. thereof;
(ii) inserting the following new Section 2.1.2.:
"2.1.2. arising under or in connection with the Priority
Notes or the Priority Notes Agreement, whether for principal of (or
premium, if any) or interest (including accretion of original issue
discount and any applicable post-default rate) on the Priority Notes,
all guaranties thereof made by any Subsidiary Guarantors, and all
obligations of the Company or any Subsidiary Guarantor for fees,
expense reimbursement, compensation, indemnification or other similar
obligations at any time arising or accruing under the Priority Notes
Agreement; or", and
(iii) renumbering the existing Section 2.1.2. as Section
2.1.3.
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<PAGE> 16
PART VI
AMENDMENT OF THE FLVI
DISBURSEMENT AND ESCROW AGREEMENT
The Disbursement and Escrow Agreement, dated as of December
19, 1995, among FLVI, the Collateral Agent and First Interstate Bank of Nevada,
N.A., as escrow agent (the "Escrow Agent") (the "FLVI Disbursement Agreement")
is hereby amended as follows:
1. THE PREAMBLE TO THE FLVI DISBURSEMENT AGREEMENT IS
HEREBY AMENDED BY:
(i) inserting, in the seventh line thereof immediately
following the words "(the "Holders")", the words "and, until Discharge of the
Priority Obligations, holders of the Priority Note Obligations"; and
(ii) deleting, in the second from last line thereof, the
words "and the Holders" and substituting in lieu thereof the words ", the
Holders and, until Discharge of the Priority Obligations, the holders of the
Priority Note Obligations".
2. RECITAL D TO THE FLVI DISBURSEMENT AGREEMENT IS
HEREBY AMENDED BY DELETING, FROM THE FIFTH LINE THEREOF, THE WORDS "THE NOTES,
THE INDENTURE" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "THE NOTES, THE
INDENTURE (AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE), THE PRIORITY NOTES,
THE PRIORITY NOTES AGREEMENT (AS DEFINED IN RECITAL E BELOW)".
3. THE FLVI DISBURSEMENT AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL D THE FOLLOWING NEW RECITAL E:
"E. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
4. THE FLVI DISBURSEMENT AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL E (AS REDESIGNATED) THE FOLLOWING NEW
RECITAL F:
"F. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all
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<PAGE> 17
other Priority Note Obligations (as defined therein) are to be secured
by first and prior liens on all collateral security granted herein."
5. RECITAL E TO FLVI DISBURSEMENT AGREEMENT IS HEREBY
AMENDED BY REDESIGNATING SUCH RECITAL AS RECITAL G.
6. SECTION 1.1. OF THE FLVI DISBURSEMENT AGREEMENT IS
HEREBY AMENDED BY:
(i) inserting, in the second line thereof immediately
following the words "the Indenture", the words ", as amended by the First
Supplemental Indenture"; and
(ii) deleting, in the first line of the definition of
"Secured Parties", the words "and the Holders" and substituting in lieu thereof
the words ", the Holders and, until Discharge of the Priority Obligations, the
holders of Priority Note Obligations".
PART VII
AMENDMENT OF THE PLEC
DISBURSEMENT AND ESCROW AGREEMENT
The Disbursement and Escrow Agreement, dated as of December
19, 1995, among PLEC, the Collateral Agent and the Escrow Agent (the "PLEC
Disbursement Agreement") is hereby amended as follows:
1. THE PREAMBLE TO THE PLEC DISBURSEMENT AGREEMENT IS
HEREBY AMENDED BY:
(i) inserting, in the seventh line thereof immediately
following the words "(the "Holders")", the words "and, until Discharge of the
Priority Obligations, holders of the Priority Note Obligations"; and
(ii) deleting, in the second from last line thereof, the
words "and the Holders" and substituting in lieu thereof the words ", the
Holders and, until Discharge of the Priority Obligations, the holders of the
Priority Note Obligations".
2. RECITAL D TO THE PLEC DISBURSEMENT AGREEMENT IS
HEREBY AMENDED BY DELETING, FROM THE FIFTH LINE THEREOF, THE WORDS "THE NOTES,
THE INDENTURE" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "THE NOTES, THE
INDENTURE (AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE), THE PRIORITY NOTES,
THE PRIORITY NOTES AGREEMENT (AS DEFINED IN RECITAL E BELOW)".
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<PAGE> 18
3. THE PLEC DISBURSEMENT AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL D THE FOLLOWING NEW RECITAL E:
"E. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
4. THE PLEC DISBURSEMENT AGREEMENT IS HEREBY AMENDED BY
INSERTING IMMEDIATELY FOLLOWING RECITAL E (AS REDESIGNATED) THE FOLLOWING NEW
RECITAL F:
"F. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all other Priority Note Obligations
(as defined therein) are to be secured by first and prior liens on all
collateral security granted herein."
5. RECITAL E TO PLEC DISBURSEMENT AGREEMENT IS HEREBY
AMENDED BY REDESIGNATING SUCH RECITAL AS RECITAL G.
6. SECTION 1.1. OF THE PLEC DISBURSEMENT AGREEMENT IS
HEREBY AMENDED BY:
(i) inserting, in the second line thereof immediately
following the words "the Indenture", the words ", as amended by the First
Supplemental Indenture"; and
(ii) deleting, in the first line of the definition of
"Secured Parties", the words "and the Holders" and substituting in lieu thereof
the words ", the Holders and, until Discharge of the Priority Obligations, the
holders of Priority Note Obligations".
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<PAGE> 19
PART VIII
AMENDMENT OF PLEC MORTGAGE
The PLEC Mortgage is hereby amended as follows:
1. THE PREAMBLE TO THE PLEC MORTGAGE IS HEREBY AMENDED
BY:
(i) deleting, in each place that it appears in the first
paragraph on the cover page thereof and in the second paragraph on the first
page thereof, the amount "$123,000,000" and substituting in lieu thereof the
amount "$128,882,000";
(ii) inserting, in the sixth from last line of the first
paragraph on the first page thereof immediately following the words "(the
"Holders")", "and, until Discharge of the Priority Obligations, holders of
Priority Note Obligations"; and
(iii) deleting, in the fifth from last line of the second
paragraph on the first page thereof, the words "(A) THE SUBSIDIARY GUARANTEE
OBLIGATIONS AND (B) THE PERMITTED INTERCOMPANY LOAN OBLIGATIONS" and
substituting in lieu thereof the words "(A) THE PRIORITY NOTE OBLIGATIONS, (B)
THE PERMITTED INTERCOMPANY LOAN OBLIGATIONS AND (C) THE SUBSIDIARY GUARANTEE
OBLIGATIONS".
2. THE PLEC MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING RECITAL B THE FOLLOWING NEW RECITAL C:
"C. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
3. THE PLEC MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING SUCH NEW RECITAL C THE FOLLOWING NEW RECITAL D:
"D. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all other Priority Note Obligations
(as defined therein) are to be secured by first and prior liens on all
collateral security granted herein."
4. RECITALS C THROUGH G TO THE PLEC MORTGAGE ARE HEREBY
AMENDED BY REDESIGNATING SUCH RECITALS AS RECITALS E THROUGH I, RESPECTIVELY.
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<PAGE> 20
5. RECITAL E (AS REDESIGNATED) TO THE PLEC MORTGAGE IS
HEREBY AMENDED BY:
(i) inserting, in the first line thereof immediately
following the words "the Indenture", the words "and in the Priority Notes
Agreement"; and
(ii) deleting, in the third line thereof, the words "the
Notes, the Indenture" and substituting in lieu thereof the words "the Notes,
the Priority Notes, the Indenture (as amended by the First Supplemental
Indenture), the Priority Notes Agreement".
6. RECITAL G (AS REDESIGNATED) TO THE PLEC MORTGAGE IS
DELETED IN ITS ENTIRETY AND THE FOLLOWING NEW RECITAL G IS SUBSTITUTED IN LIEU
THEREOF:
"G. Pursuant to the Indenture (as amended by the First
Supplemental Indenture) and the Priority Notes Agreement, the Priority
Note Obligations, the Subsidiary Guarantee and the Permitted
Intercompany Loans of Trustor are required to be secured, directly or
indirectly, by, among other things, the Deed of Trust."
7. RECITAL H (AS REDESIGNATED) TO THE PLEC MORTGAGE IS
HEREBY AMENDED BY DELETING, IN THE LAST LINE THEREOF, THE WORDS "NOTES, THE
INDENTURE" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "NOTES, THE PRIORITY
NOTES, THE INDENTURE (AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE), THE
PRIORITY NOTES AGREEMENT".
8. THE PREAMBLE TO THE GRANTING CLAUSES (AS IT APPEARS
ON THE SECOND PAGE OF THE PLEC MORTGAGE) IS HEREBY AMENDED BY DELETING, IN THE
FOURTH LINE THEREOF, THE WORDS "AND THE HOLDERS" AND SUBSTITUTING IN LIEU
THEREOF THE WORDS ", THE HOLDERS AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, THE HOLDERS OF PRIORITY NOTE OBLIGATIONS".
9. THE PLEC MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING GRANTING CLAUSE FOURTEEN (AS IT APPEARS ON THE SIXTH PAGE
OF THE PLEC MORTGAGE) THE FOLLOWING NEW PARAGRAPH A:
"A. With respect to Trustor in its capacity both as a
Restricted Subsidiary and as a Subsidiary Guarantor, the due and
punctual payment and performance of any and all present and future
obligations and liabilities of Trustor of every type or description
arising under or in connection with the Priority Notes or the Priority
Notes Agreement, whether for principal (or premium, if any) or
interest (including accretion of original issue discount and any
applicable post-default rate) on the Priority Notes, all guaranties
thereof made by Trustor, and all obligations of Trustor for fees,
expense
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<PAGE> 21
reimbursement, compensation, indemnification or other similar
obligations at any time arising or accruing under the Priority Notes
Agreement (collectively, the "Priority Note Obligations");"
10. PARAGRAPHS A THROUGH D IMMEDIATELY FOLLOWING GRANTING
CLAUSE FOURTEEN (AS THEY APPEAR APPEARS ON THE SIXTH AND SEVENTH PAGES OF THE
PLEC MORTGAGE) ARE HEREBY AMENDED BY:
(i) redesignating Paragraphs A through D as Paragraphs B
through E, respectively;
(ii) reversing the order in which Paragraphs B and C (as
redesignated) appear, redesignating Paragraph B as Paragraph C and
redesignating Paragraph C and Paragraph B;
(iii) deleting, in the fourth line of Paragraph B (as
redesignated) the words "the Holders" and substituting in lieu thereof the
words ", the Holders and, until Discharge of the Priority Obligations, the
holders of the Priority Note Obligations".
11. THE CARRY-OVER PARAGRAPH IMMEDIATELY FOLLOWING
PARAGRAPH E (AS REDESIGNATED) (AS IT APPEARS ON THE SEVENTH PAGE OF THE PLEC
MORTGAGE) IS HEREBY AMENDED BY INSERTING, IN THE SECOND FROM LAST LINE THEREOF
IMMEDIATELY FOLLOWING THE WORD "LIMITATION,", THE WORDS "THE PRIORITY NOTE
OBLIGATIONS,".
12. THE PARAGRAPH BEGINNING WITH THE WORDS "FOR PURPOSES
OF THIS DEED OF TRUST" (AS IT APPEARS ON THE SEVENTH PAGE OF THE PLEC MORTGAGE)
IS HEREBY AMENDED BY:
(i) deleting the amount "$123,000,000" in each place that
it appears and substituting in lieu thereof the amount "$128,882,000";
(ii) deleting, in the fifth line thereof, the words "(a)
the Subsidiary Guarantee Obligations and (b) the Permitted Intercompany Loan
Obligations" and substituting in lieu thereof the words "(a) the Priority Note
Obligations, (b) the Permitted Intercompany Loan Obligations and (c) the
Subsidiary Guarantee Obligations"; and
(iii) inserting, in the last line thereof immediately
following the word "Holders", the word "and, until Discharge of the Priority
Obligations, the holders of the Priority Note Obligations".
13. THE PLEC MORTGAGE IS HEREBY AMENDED BY INSERTING,
IMMEDIATELY PRIOR TO THE PARAGRAPH (AS IT APPEARS ON THE SEVENTH PAGE OF THE
PLEC MORTGAGE)
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<PAGE> 22
BEGINNING WITH THE WORDS "THE LIEN GRANTED BY TRUSTOR AS SECURITY", THE
FOLLOWING NEW PARAGRAPH:
"Notwithstanding anything to the contrary in this Deed of Trust,
including, without limitation, the immediately succeeding paragraph,
until Discharge of the Priority Obligations, the Liens granted by
Trustor hereunder as security for the Secured Obligations shall
secure, in order of preference and priority, first, the Priority Note
Obligations, second, the Permitted Intercompany Loan Obligations, and,
third, the Subsidiary Guarantee Obligations."
14. THE PARAGRAPH (AS IT APPEARS ON THE SEVENTH PAGE OF
THE PLEC MORTGAGE) BEGINNING WITH THE WORDS "THE LIEN GRANTED BY TRUSTOR AS
SECURITY" IS HEREBY AMENDED BY:
(i) deleting, in the first line thereof, the words "The
Lien granted" and substituting in lieu thereof the words "Subject to the
immediately preceding paragraph, the Lien granted";
(ii) deleting, in the first line thereof, the words
"Permitted Intercompany Loan Obligations" and substituting in lieu thereof the
words "Subsidiary Guarantee Obligations";
(iii) deleting, in the third line thereof, the words
"Subsidiary Guarantee Obligations" and substituting in lieu thereof the words
"Permitted Intercompany Loan Obligations"; and
(iv) deleting the last sentence thereof in its entirety
and substituting in lieu thereof the following new sentence:
"The parties hereto intend that the Lien granted by Trustor as
security for the Priority Note Obligations (the "Superpriority Lien")
shall at all times be separate and apart from the Junior Lien and the
Senior Lien, notwithstanding that the beneficiary of all such Liens
may be the Beneficiary, and that such Liens shall not be merged."
15. SECTION 1.1. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY:
(i) inserting, in the second line thereof immediately
following the words "the Indenture", the words ", as amended by the First
Supplemental Indenture";
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<PAGE> 23
(ii) by inserting, in the first line of the definition of
"Applicable Priority" immediately following the word "means,", the words
"subject in each case to the priority of the Superpriority Lien,";
(iii) by inserting, immediately following the definition of
"Personalty", the following new definition:
""PRIORITY NOTE OBLIGATIONS" has the meaning set forth
hereinabove.";
(iv) by deleting the definition of "Secured Parties" in
its entirety and substituting in lieu thereof the following new definition:
""SECURED PARTIES" means, collectively, the Collateral Agent,
the Trustee, the Holders and, until Discharge of the Priority
Obligations, the holders of Priority Note Obligations, and, solely,
with respect to the Senior Lien, Fitzgeralds and the respective
successors and assigns of such Persons."; and
(v) by inserting, immediately following the definition of
"Subsidiary Guarantee Obligations" the following new definition:
""SUPERPRIORITY LIEN" has the meaning set forth hereinabove."
16. ARTICLE II OF THE PLEC MORTGAGE IS HEREBY AMENDED BY
INSERTING, IN THE SEVENTH AND NINTH LINES THEREOF IMMEDIATELY FOLLOWING THE
WORDS "THE INDENTURE" THE WORDS ", AS AMENDED BY THE FIRST SUPPLEMENTAL
INDENTURE".
17. SECTION 4.4. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE FOURTH LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "THE
INDENTURE", THE WORDS ", AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE,".
18. SECTION 4.5.1. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE THIRD FROM LAST LINE THEREOF, THE WORDS "LIEN JUNIOR TO THE
SENIOR LIEN AND JUNIOR LIEN" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "LIEN
JUNIOR TO THE SUPERPRIORITY LIEN, SENIOR LIEN AND JUNIOR LIEN".
19. SECTION 4.7.1. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY:
(i) deleting, in the third line thereof, the words "the
Senior Lien" and substituting in lieu thereof the words "the Superpriority
Lien, Senior Lien";
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<PAGE> 24
(iii) inserting, in the sixth line thereof immediately
following the word "Indenture", the words ", as amended by the First
Supplemental Indenture"; and
(iii) deleting, in the eleventh line thereof, the words
"the Senior Lien" and substituting in lieu thereof "the Superpriority Lien".
20. SECTION 4.7.2. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE FIRST LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "THE
INDENTURE", THE WORDS ", AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE,".
21. SECTION 4.13. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE FIFTEENTH LINE THEREOF, THE WORDS "SENIOR LIEN" AND
SUBSTITUTING IN LIEU THEREOF THE WORDS "SUPERPRIORITY LIEN".
22. SECTION 7.1.2. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE FIRST LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS
"SECTION 1016 OF THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE)".
23. SECTION 8.2.5. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE SECOND LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS
"SECTION 502 OF THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE)".
24. SECTION 9.1. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE FOURTH LINE THEREOF, THE WORDS "AND THE HOLDERS" AND
SUBSTITUTING IN LIEU THEREOF THE WORDS ", THE HOLDERS AND, UNTIL DISCHARGE OF
THE PRIORITY OBLIGATIONS, THE HOLDERS OF PRIORITY NOTE OBLIGATIONS".
25. SECTION 9.4.2. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE NINTH LINE THEREOF, THE WORDS "SENIOR LIEN" AND
SUBSTITUTING IN LIEU THEREOF THE WORDS "SUPERPRIORITY LIEN".
26. SECTION 10.2. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE SECOND LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "THE
NOTES", THE WORDS "OR THE PRIORITY NOTES".
27. SECTION 11.2.7. OF THE PLEC MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE SECOND LINE THEREOF IMMEDIATELY FOLLOWING THE
WORDS "THE HOLDERS", THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, THE HOLDERS OF PRIORITY NOTE OBLIGATIONS".
28. SECTION 12.6. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY:
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<PAGE> 25
(i) inserting, in the sixth line thereof immediately
following the words "Section 501 of the Indenture", the words "(as amended by
the First Supplemental Indenture)"; and
(ii) deleting, in the third from last line thereof, the
words "Senior Lien and the Junior Lien" and substituting in lieu thereof the
words "the Superpriority Lien, the Senior Lien and the Junior Lien".
29. SECTION 12.11. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE SIXTH LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "IN THE
INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE)".
30. SECTION 12.12. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY:
(i) deleting, in the fifth line thereof, the word
"either" and substituting in lieu thereof the word "any";
(ii) inserting, in the sixth from last line thereof
immediately following the words "by the Indenture", the words ", as amended by
the First Supplemental Indenture"; and
31. SECTION 12.16. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING IN THE SECOND AND FIFTH LINES THEREOF IMMEDIATELY FOLLOWING THE
WORDS "SECTION 1202 OF THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE)".
PART IX
AMENDMENT OF FLVI MORTGAGE
The FLVI Mortgage is hereby amended as follows:
1. DELETING IN EACH PLACE THAT IT APPEARS IN THE FLVI
MORTGAGE, "FIRST INTERSTATE BANK OF NEVADA, N.A., A NATIONAL BANKING
ASSOCIATION, HAVING ITS PRINCIPAL OFFICE AT 3800 HOWARD HUGHES PARKWAY, SUITE
200, LAS VEGAS, NV 89109 ("FIRST INTERSTATE")" AND SUBSTITUTING IN LIEU
THEREOF "WELLS FARGO BANK, N.A., HAVING ITS PRINCIPAL OFFICE AT 633 17TH
STREET, 21ST FLOOR, DENVER, CO 80270 ("WELLS FARGO")".
2. THE PREAMBLE TO THE FLVI MORTGAGE IS HEREBY AMENDED
BY:
(i) inserting, in the sixth from last line of the first
paragraph thereof immediately following the words "(the "Holders")", "and,
until Discharge of the Priority Obligations, holders of Priority Note
Obligations";
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(ii) inserting, in the first line of the second paragraph
thereof immediately following the word "MORTGAGE", ".";
(iii) deleting, in the fifth from last line of the second
paragraph thereof, the words "(A) THE SUBSIDIARY GUARANTEE OBLIGATIONS AND (B)
THE PERMITTED INTERCOMPANY LOAN OBLIGATIONS" and substituting in lieu thereof
the words "(A) THE PRIORITY NOTE OBLIGATIONS, (B) THE PERMITTED INTERCOMPANY
LOAN OBLIGATIONS AND (C) THE SUBSIDIARY GUARANTEE OBLIGATIONS"; and
(iv) inserting, after the second paragraph thereof the
following new paragraph:
"SAID INSTRUMENT, AS AMENDED HEREBY, SHALL ALSO SECURE
PRIORITY NOTE OBLIGATIONS LIMITED IN PRINCIPAL AMOUNT TO $5,882,000.".
3. THE FLVI MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING RECITAL B THE FOLLOWING NEW RECITAL C:
"C. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
4. THE FLVI MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING SUCH NEW RECITAL C THE FOLLOWING NEW RECITAL D:
"D. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all other Priority Note Obligations
(as defined therein) are to be secured by first and prior liens on all
collateral security granted herein."
5. RECITALS C THROUGH H TO THE FLVI MORTGAGE ARE HEREBY
AMENDED BY REDESIGNATING SUCH RECITALS AS RECITALS E THROUGH J, RESPECTIVELY.
6. RECITAL E (AS REDESIGNATED) TO THE FLVI MORTGAGE IS
HEREBY AMENDED BY:
(i) inserting, in the first line thereof immediately
following the words "the Indenture", the words "and in the Priority Notes
Agreement"; and
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(ii) deleting, in the third line thereof, the words "the
Notes, the Indenture" and substituting in lieu thereof the words "the Notes,
the Priority Notes, the Indenture (as amended by the First Supplemental
Indenture), the Priority Notes Agreement".
7. RECITAL G (AS REDESIGNATED) TO THE FLVI MORTGAGE IS
DELETED IN ITS ENTIRETY AND THE FOLLOWING NEW RECITAL G IS SUBSTITUTED IN LIEU
THEREOF:
"G. Pursuant to the Indenture (as amended by the First
Supplemental Indenture) and the Priority Notes Agreement, the Priority
Note Obligations, the Subsidiary Guarantee and the Permitted
Intercompany Loans of Trustor are required to be secured, directly or
indirectly, by, among other things, the Deed of Trust."
8. RECITAL H (AS REDESIGNATED) TO THE FLVI MORTGAGE IS
HEREBY AMENDED BY DELETING, IN THE SECOND FROM LAST LINE THEREOF, THE WORDS
"THE NOTES, THE INDENTURE" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "THE
NOTES, THE PRIORITY NOTES, THE INDENTURE (AS AMENDED BY THE FIRST SUPPLEMENTAL
INDENTURE), THE PRIORITY NOTES AGREEMENT".
9. THE PREAMBLE TO THE GRANTING CLAUSES (AS IT APPEARS
ON THE SECOND PAGE OF THE FLVI MORTGAGE) IS HEREBY AMENDED BY DELETING, IN THE
FOURTH LINE THEREOF, THE WORDS "AND THE HOLDERS" AND SUBSTITUTING IN LIEU
THEREOF THE WORDS ", THE HOLDERS AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, THE HOLDERS OF PRIORITY NOTE OBLIGATIONS".
10. THE FLVI MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING GRANTING CLAUSE FOURTEEN (AS IT APPEARS ON THE SIXTH PAGE
OF THE FLVI MORTGAGE) THE FOLLOWING NEW PARAGRAPH A:
"A. With respect to Trustor in its capacity both as a
Restricted Subsidiary and as a Subsidiary Guarantor, the due and
punctual payment and performance of any and all present and future
obligations and liabilities of Trustor of every type or description
arising under or in connection with the Priority Notes or the Priority
Notes Agreement, whether for principal (or premium, if any) or
interest (including accretion of original issue discount and any
applicable post-default rate) on the Priority Notes, all guaranties
thereof made by Trustor, and all obligations of Trustor for fees,
expense reimbursement, compensation, indemnification or other similar
obligations at any time arising or accruing under the Priority Notes
Agreement (collectively, the "Priority Note Obligations");"
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<PAGE> 28
11. PARAGRAPHS A THROUGH D IMMEDIATELY FOLLOWING GRANTING
CLAUSE FOURTEEN (AS THEY APPEAR ON THE SIXTH AND SEVENTH PAGES OF THE FLVI
MORTGAGE) ARE HEREBY AMENDED BY:
(i) renumbering Paragraphs A through D as Paragraphs B
through E, respectively;
(ii) reversing the order in which Paragraphs B and C (as
redesignated) appear, redesignating Paragraph B as Paragraph C and
redesignating Paragraph C and Paragraph B; and
(iii) deleting, in the fourth line of Paragraph B (as
redesignated) the words "the Holders" and substituting in lieu thereof the
words ", the Holders and, until Discharge of the Priority Obligations, the
holders of the Priority Note Obligations".
12. THE CARRY-OVER PARAGRAPH IMMEDIATELY FOLLOWING
PARAGRAPH E (AS REDESIGNATED) (AS IT APPEARS ON THE SEVENTH PAGE OF THE FLVI
MORTGAGE) IS HEREBY AMENDED BY INSERTING, IN THE SECOND FROM LAST LINE THEREOF
IMMEDIATELY FOLLOWING THE WORD "LIMITATION,", THE WORDS "THE PRIORITY NOTE
OBLIGATIONS,".
13. THE FLVI MORTGAGE IS HEREBY AMENDED BY INSERTING,
IMMEDIATELY PRIOR TO THE PARAGRAPH (AS IT APPEARS ON THE SEVENTH PAGE OF THE
FLVI MORTGAGE) BEGINNING WITH THE WORDS "THE LIEN GRANTED BY TRUSTOR AS
SECURITY", THE FOLLOWING NEW PARAGRAPH:
"Notwithstanding anything to the contrary in this Deed of Trust,
including, without limitation, the immediately succeeding paragraph,
until Discharge of the Priority Obligations, the Liens granted by
Trustor hereunder as security for the Secured Obligations shall
secure, in order of preference and priority, first, the Priority Note
Obligations, second, the Permitted Intercompany Loan Obligations, and,
third, the Subsidiary Guarantee Obligations."
14. THE PARAGRAPH (AS IT APPEARS ON THE SEVENTH PAGE OF
THE FLVI MORTGAGE) BEGINNING WITH THE WORDS "THE LIEN GRANTED BY TRUSTOR AS
SECURITY" IS HEREBY AMENDED BY:
(i) deleting, in the first line thereof, the words "The
Lien granted" and substituting in lieu thereof the words "Subject to the
immediately preceding paragraph, the Lien granted"; and
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<PAGE> 29
(ii) deleting, in the first line thereof, the words
"Permitted Intercompany Loan Obligations" and substituting in lieu thereof the
words "Subsidiary Guarantee Obligations";
(iii) deleting, in the third line thereof, the words
"Subsidiary Guarantee Obligations" and substituting in lieu thereof the words
"Permitted Intercompany Loan Obligations"; and
(iv) deleting the last sentence thereof in its entirety
and substituting in lieu thereof the following new sentence:
"The parties hereto intend that the Lien granted by Trustor as
security for the Priority Note Obligations (the "Superpriority Lien")
shall at all times be separate and apart from the Junior Lien and the
Senior Lien, notwithstanding that the beneficiary of all such Liens
may be the Beneficiary, and that such Liens shall not be merged."
15. SECTION 1.1. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY:
(i) inserting, in the second line thereof immediately
following the words "the Indenture", the words ", as amended by the First
Supplemental Indenture";
(ii) inserting, in the first line of the definition of
"Applicable Priority" immediately following the word "means,", the words
"subject in each case to the priority of the Superpriority Lien,";
(iii) deleting the definition of "Casino Lease" in its
entirety and substituting in lieu thereof the following new definition:
""CASINO LEASE" has the meaning set forth in Recital J.";
(iv) inserting, immediately following the definition of
"Personalty", the following new definition:
""PRIORITY NOTE OBLIGATIONS" has the meaning set forth
hereinabove.";
(v) deleting the definition of "Secured Parties" in its
entirety and substituting in lieu thereof the following new definition:
""SECURED PARTIES" means, collectively, the Collateral Agent,
the Trustee, the Holders and, until Discharge of the Priority
Obligations, the holders of Priority Note Obligations, and, solely,
with respect to the Senior
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<PAGE> 30
Lien, Fitzgeralds and the respective successors and assigns of such
Persons."; and
(vi) inserting, immediately following the definition of
"Subsidiary Guarantee Obligations" the following new definition:
""SUPERPRIORITY LIEN" has the meaning set forth hereinabove."
16. ARTICLE 2 OF THE FLVI MORTGAGE IS HEREBY AMENDED BY
INSERTING, IN THE SEVENTH AND NINTH LINES THEREOF IMMEDIATELY FOLLOWING THE
WORDS "THE INDENTURE" THE WORDS "(AS AMENDED BY THE FIRST SUPPLEMENTAL
INDENTURE)".
17. SECTION 4.4. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE FOURTH LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "THE
INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE)".
18. SECTION 4.5.1. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE THIRD FROM LAST LINE THEREOF, THE WORDS "LIEN JUNIOR TO THE
SENIOR LIEN AND JUNIOR LIEN" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "LIEN
JUNIOR TO THE SUPERPRIORITY LIEN, SENIOR LIEN AND JUNIOR LIEN".
19. SECTION 4.7.1. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY:
(i) deleting, in the third line thereof, the words "the
Senior Lien" and substituting in lieu thereof the words "the Superpriority
Lien, Senior Lien";
(ii) inserting, in the sixth line thereof immediately
following the word "Indenture", the words "(as amended by the First
Supplemental Indenture)"; and
(iii) deleting, in the eleventh line thereof, the words
"the Senior Lien" and substituting in lieu thereof "the Superpriority Lien".
20. SECTION 4.7.2. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE FIRST LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "THE
INDENTURE", THE WORDS "(AS AMENDED BY IN THE FIRST SUPPLEMENTAL INDENTURE)".
21. SECTION 4.13. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE FIFTEENTH LINE THEREOF, THE WORDS "SENIOR LIEN" AND
SUBSTITUTING IN LIEU THEREOF THE WORDS "SUPERPRIORITY LIEN".
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<PAGE> 31
22. SECTION 5.2.12. OF THE FLVI MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE TWELFTH LINE THEREOF IMMEDIATELY FOLLOWING THE
WORDS "THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST SUPPLEMENTAL
INDENTURE)".
23. SECTION 7.1.2. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE FIRST LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS
"SECTION 1016 OF THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE)".
24. SECTION 8.2.5. OF THE PLEC MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE SECOND LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS
"SECTION 502 OF THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE)".
25. SECTION 9.1. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE FOURTH LINE THEREOF, THE WORDS "AND THE HOLDERS" AND
SUBSTITUTING IN LIEU THEREOF THE WORDS ", THE HOLDERS AND, UNTIL DISCHARGE OF
THE PRIORITY OBLIGATIONS, THE HOLDERS OF PRIORITY NOTE OBLIGATIONS".
26. SECTION 9.4.2. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY DELETING, IN THE NINTH LINE THEREOF, THE WORDS "SENIOR LIEN" AND
SUBSTITUTING IN LIEU THEREOF THE WORDS "SUPERPRIORITY LIEN".
27. SECTION 10.2. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE SECOND LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "THE
NOTES", THE WORDS "OR THE PRIORITY NOTES".
28. SECTION 11.2.7. OF THE FLVI MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE SECOND LINE THEREOF IMMEDIATELY FOLLOWING THE
WORDS "THE HOLDERS", THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, THE HOLDERS OF PRIORITY NOTE OBLIGATIONS".
29. SECTION 12.6. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY:
(i) inserting, in the sixth line thereof immediately
following the words "Section 501 of the Indenture", the words "(as amended by
the First Supplemental Indenture)"; and
(ii) deleting, in the third from last line thereof, the
words "Senior Lien and the Junior Lien" and substituting in lieu thereof the
words "the Superpriority Lien, the Senior Lien and the Junior Lien".
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<PAGE> 32
30. SECTION 12.11. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY INSERTING, IN THE SIXTH LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS "IN THE
INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE)".
31. SECTION 12.12. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY:
(i) deleting, in the fifth line thereof, the word
"either" and substituting in lieu thereof the word "any"; and
(ii) inserting, in the sixth from last line thereof
immediately following the words "by the Indenture", the words "(as amended by
the First Supplemental Indenture)".
32. SECTION 12.16. OF THE FLVI MORTGAGE IS HEREBY AMENDED
BY INSERTING IN THE SECOND AND FIFTH LINES THEREOF IMMEDIATELY FOLLOWING THE
WORDS "SECTION 1202 OF THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE)".
PART X
AMENDMENT OF PLEC SHIP MORTGAGE
The PLEC Ship Mortgage is hereby amended as follows:
1. THE PRELIMINARY MORTGAGE DATA (AS IT APPEARS ON THE
FIRST PAGE OF THE PLEC SHIP MORTGAGE) IS HEREBY AMENDED BY DELETING, IN EACH
PLACE THAT IT APPEARS, THE AMOUNT "$246,000,000" AND SUBSTITUTING IN LIEU
THEREOF THE AMOUNT "$257,764,000".
2. THE PREAMBLE TO THE PLEC SHIP MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE EIGHTH LINE THEREOF IMMEDIATELY FOLLOWING THE
WORDS "(THE "HOLDERS")", THE WORDS "AND, UNTIL DISCHARGE OF THE PRIORITY
OBLIGATIONS, HOLDERS OF PRIORITY NOTE OBLIGATIONS".
3. THE PLEC SHIP MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING RECITAL B THE FOLLOWING NEW RECITAL C:
"C. The Pledgor will issue Priority Secured Notes due
December 31, 1998 in an aggregate principal amount of up to $5,882,000
(the "Priority Notes"), subject to the terms and conditions set forth
in a Note Purchase Agreement dated as of December 30, 1996 (the
"Priority Notes Agreement")."
4. THE PLEC SHIP MORTGAGE IS HEREBY AMENDED BY INSERTING
IMMEDIATELY FOLLOWING RECITAL C (AS REDESIGNATED) THE FOLLOWING NEW RECITAL D:
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"D. Pursuant to the First Supplemental Indenture, dated as of
December 30, 1996 (as supplemented or otherwise amended from time to
time, the "First Supplemental Indenture") by and among the Pledgor,
the Subsidiary Guarantors and Wells Fargo Bank, N.A., as successor
Trustee, such Priority Notes and all other Priority Note Obligations
(as defined therein) are to be secured by first and prior liens on all
collateral security granted herein."
5. RECITALS C THROUGH G TO THE PLEC SHIP MORTGAGE ARE
HEREBY AMENDED BY REDESIGNATING SUCH RECITALS AS RECITALS E THROUGH I,
RESPECTIVELY.
6. RECITAL E (AS REDESIGNATED) TO THE PLEC SHIP MORTGAGE
IS HEREBY AMENDED BY:
(i) inserting, in the first line thereof immediately
following the words "the Indenture", the words "and in the Priority Notes
Agreement"; and
(ii) deleting, in the third line thereof, the words "the
Notes, the Indenture" and substituting in lieu thereof the words "the Notes,
the Priority Notes, the Indenture (as amended by the First Supplemental
Indenture), the Priority Notes Agreement".
7. RECITAL G (AS REDESIGNATED) TO THE PLEC SHIP MORTGAGE
IS DELETED IN ITS ENTIRETY AND THE FOLLOWING NEW RECITAL G IS SUBSTITUTED IN
LIEU THEREOF:
"G. Pursuant to the Indenture (as amended by the First
Supplemental Indenture) and the Priority Notes Agreement, the Priority
Note Obligations, the Subsidiary Guarantee and the Permitted
Intercompany Loans are required to be secured, directly or indirectly,
by, among other things, the Deed of Trust."
8. RECITAL H (AS REDESIGNATED) TO THE PLEC SHIP MORTGAGE
IS HEREBY AMENDED BY DELETING, IN THE SECOND FROM LAST LINE THEREOF, THE WORDS
"NOTES, THE INDENTURE" AND SUBSTITUTING IN LIEU THEREOF THE WORDS "NOTES, THE
PRIORITY NOTES, THE INDENTURE (AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE),
THE PRIORITY NOTES AGREEMENT".
9. THE PLEC SHIP MORTGAGE IS HEREBY AMENDED BY
INSERTING, IN THE DEFINITION OF "SECURED OBLIGATIONS" IN THE GRANTING CLAUSE
THEREOF, THE FOLLOWING NEW PARAGRAPH (A):
"(a) any Secured Party, the due and punctual payment and
performance of any and all present and future obligations and
liabilities of the Mortgagor of every type or description arising
under or in connection with the Priority Notes or the Priority Notes
Agreement, whether for principal (or premium, if any) or
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interest (including accretion of original issue discount and any
applicable post-default rate) on the Priority Notes, all guaranties
thereof made by the Mortgagor, and all obligations of the Mortgagor
for fees, expense reimbursement, compensation, indemnification or
other similar obligations at any time arising or accruing under the
Priority Notes Agreement (collectively, the "Priority Note
Obligations");"
10. PARAGRAPHS (A) THROUGH (C) IN THE DEFINITION OF
"SECURED OBLIGATIONS" ARE HEREBY AMENDED BY:
(i) redesignating paragraphs (a) through (c) as
paragraphs (b) through (d), respectively; and
(ii) reversing the order in which paragraphs (b) and (c)
(as redesignated) appear, redesignating paragraph (b) as paragraph (c) and
redesignating paragraph (c) and paragraph (b).
11. SECTION 1.1 OF THE PLEC SHIP MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE SECOND LINE THEREOF IMMEDIATELY FOLLOWING THE
WORDS "THE INDENTURE", THE WORDS ", AS AMENDED BY THE FIRST SUPPLEMENTAL
INDENTURE".
12. ARTICLE 2 TO THE PLEC SHIP MORTGAGE IS HEREBY AMENDED
BY DELETING, IN EACH PLACE THAT IT APPEARS, THE AMOUNT "$246,000,000" AND
SUBSTITUTING IN LIEU THEREOF THE AMOUNT "$257,764,000".
13. SECTION 4.6.2 OF THE PLEC SHIP MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE SECOND FROM LAST LINE THEREOF IMMEDIATELY
FOLLOWING THE WORDS "(AS DEFINED IN THE INDENTURE" THE WORDS "(AS AMENDED BY
THE FIRST SUPPLEMENTAL INDENTURE)".
14. SECTION 4.9.1 OF THE PLEC SHIP MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE FIRST LINE THEREOF IMMEDIATELY FOLLOWING THE WORDS
"SECTION 1016 OF THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST
SUPPLEMENTAL INDENTURE)".
15. SECTION 5.1.1 OF THE PLEC SHIP MORTGAGE IS HEREBY
AMENDED BY INSERTING, IN THE FIRST LINE THEREOF IMMEDIATELY AFTER THE WORDS
"THE INDENTURE", THE WORDS "(AS AMENDED BY THE FIRST SUPPLEMENTAL INDENTURE)".
16. SECTION 5.7.1 OF THE PLEC SHIP MORTGAGE IS HEREBY
AMENDED BY:
(i) deleting clauses "Second", "Third" and "Fourth"
thereof and substituting in lieu the following new clauses:
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<PAGE> 35
"Second: To pay the Priority Note Obligations in the order
set forth in the Indenture, as amended by the First Supplemental
Indenture;
Third: To pay accrued interest on and principal of the
Permitted Intercompany Notes;
Fourth: To pay the Subsidiary Guarantee in the order set
forth in the Indenture with respect the obligations of Fitzgeralds
underlying such obligations; and"; and
(ii) redesignating clause "Fourth" as clause "Fifth".
17. SECTION 6.12 OF THE PLEC SHIP MORTGAGE IS HEREBY
AMENDED BY:
(i) inserting the following new paragraph (a):
"Notwithstanding anything to the contrary in this Mortgage, including,
without limitation, Section 6.12(b) below, until Discharge of the
Priority Obligations, the Liens held by the Collateral Agent hereunder
as security for the Secured Obligations shall secure, in order of
preference and priority, first, the Priority Note Obligations, second,
the Permitted Intercompany Loan Obligations, and, third, the
Subsidiary Guarantee Obligations.";
(ii) numbering the paragraph beginning with the words "The
Permitted Intercompany Loan Obligations" as paragraph (b);
(iii) deleting, in the first line of paragraph (b) (as
newly numbered), the words "The Permitted Intercompany Loan Obligations" and
substituting in lieu thereof the words "Subject to paragraph (a) above, the
Permitted Intercompany Loan Obligations";
(iv) deleting, in each place that they appear in paragraph
(b) (as newly numbered), the words "Permitted Intercompany Loan Obligations"
and substituting in lieu thereof the words "Subsidiary Guarantee Obligations",
and deleting, in each place that they appear in such paragraph (b), the words
"Subsidiary Guarantee Obligations" and substituting in lieu thereof the words
"Permitted Intercompany Loan Obligations" so that in each place that the words
"Permitted Intercompany Loan Obligations" formerly appeared, the words
"Subsidiary Guarantee Obligations" appear, and vice versa; and
(v) deleting the last sentence thereof in its entirety
and substituting in lieu thereof the following new sentence:
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<PAGE> 36
"The parties hereto intend that the Priority Note Obligations shall at
all times be separate and apart from the Permitted Intercompany Loan
Obligations and the Subsidiary Guarantee Obligations, notwithstanding
that the holder of each such Secured Obligation may be the
Trustee-Mortgagee."
PART XI
AMENDMENT OF CERTAIN OTHER COLLATERAL DOCUMENTS
1. Without prejudice to the generality of Section 5 of
Part XII, the parties hereto agree and covenant, concurrently with the
execution and delivery of the amendments of the PLEC Mortgage and the FLVI
Mortgage, to, and to use their best efforts to cause the counterparties thereto
to, execute and deliver (if required, in duly attested and recordable form), at
their sole cost and expense (including, without limitation, any recordation
fees and expenses), Contractor's Subordination Agreements in substantially the
form of the Contractor's Subordination Agreements listed on Schedule B hereto,
with such changes as are necessary to reflect the execution of such instruments
and to ensure that the Liens held by the Trustee or the Collateral Agent under
such instruments secure the Priority Note Obligations in preference and
priority over the Notes, the Subsidiary Guarantees and all other Secured
Obligations.
PART XII
MISCELLANEOUS
1. Notwithstanding the foregoing provisions of this
Global Amendment, (i) neither the Company nor any Restricted Subsidiary shall
be required to pledge, or to grant a Lien, as security for Priority Note
Obligations, upon, the capital stock of any Subsidiary of the Company which
holds, or which owns a Subsidiary which holds, a Gaming License issued by a
Gaming Authority in the State of Nevada or in the State of Mississippi, unless
and until all such Gaming Authorities in such State have approved the pledge or
grant of a Lien upon such capital stock as security for Priority Note
Obligations, (ii) any provision of this Global Amendment pursuant to which
Priority Note Obligations would (but for this clause (ii)) become secured by
any such capital stock shall become effective only if and when such approval is
granted, and (iii) such provision shall become effective, automatically,
unconditionally and irrevocably and without necessity of any further act or
deed, immediately when such approval is granted in such State.
2. Unless otherwise expressly provided herein,
references in each of the Collateral Documents amended by this Global Amendment
to "the Indenture", or to any section or subsection thereof or to any schedule
thereto, shall be construed, where the context so requires, to additionally or
alternatively (as applicable) include the section, subsection or schedule of or
to the Indenture, as amended by the First Supplemental Indenture, corresponding
to the section, subsection or schedule of the Indenture so referenced.
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3. The Company hereby agrees and covenants to file
appropriate applications for all Gaming Authority approvals referred to in
Section 1 of this Part VIII no later than January 10, 1997, to diligently
prosecute such applications and to use its best efforts to obtain such
approvals in accordance with gaming laws and practice and as promptly as
practicable.
4. Upon Discharge of the Priority Obligations (as
defined in the Indenture, as amended by the First Supplemental Indenture), the
agreements and amendments set forth herein shall be discharged and each of the
Collateral Documents shall continue in full force and effect upon the terms and
conditions set forth therein, as such terms and conditions were in effect
immediately prior to the effectiveness of the amendments made herein, as such
terms and conditions from time to time hereafter may be amended.
5. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned such terms in the Indenture, as
amended by the First Supplemental Indenture.
6. As amended by the amendments expressly provided
herein, the Collateral Documents shall continue to be, and shall remain, in
full force and effect in accordance with their respective terms. The
amendments provided for herein shall be limited precisely as drafted and shall
not be construed as an amendment or waiver of any other provisions of the
Collateral Documents other than as expressly provided herein.
7. The parties hereto agree to execute and deliver, at
the sole cost and expense of such parties (including, without limitation, any
recordation fees and expenses), any and all amendments and supplements of the
Collateral Documents (if required, in duly attested and recordable form) that
may reasonably be requested by any holder of Priority Notes in order to further
assure that the purpose and intent of this Global Amendment are reflected in
any instrument or agreement that may be required or appropriate under the laws
of any jurisdiction in which any Collateral is located or to reflect the
agreements herein set forth in a document filed for public record or otherwise
to perfect and prioritize any Lien held by the Indenture Trustee or the
Collateral Agent as security for the Priority Note Obligations.
8. This Global Amendment may be executed in any number
of counterparts by the parties hereto, and all of said counterparts shall be
deemed to constitute one and the same instrument.
9. THIS GLOBAL AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS THAT GOVERN THE CORRESPONDING COLLATERAL
DOCUMENT.
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IN WITNESS WHEREOF, the parties hereto have caused this Global
Collateral Documents Amendment to be duly executed as of the day and year first
written above.
FITZGERALDS GAMING CORPORATION, a Nevada
corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS SOUTH, INC., a Nevada corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS RENO, INC., a Nevada corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS INCORPORATED, a Nevada corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
<PAGE> 39
FITZGERALDS LAS VEGAS, INC., a Nevada
corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS FREMONT EXPERIENCE CORPORATION, a
Nevada corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS MISSISSIPPI, INC., a Nevada
corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
FITZGERALDS BLACK HAWK, INC., a Nevada
corporation
By:__________________________________________
Name: Fernando Bensuaski
Title: Executive Vice President & Secretary
<PAGE> 40
WELLS FARGO BANK, N.A., a National
Banking Association, as successor to First
Interstate Bank of Nevada, N.A., as Trustee
By:__________________________________________
Name:________________________________________
Title:_______________________________________
WELLS FARGO BANK, N.A., a National
Banking Association, as successor to First
Interstate Bank of Nevada, N.A., as Collateral
Agent
By:__________________________________________
Name:________________________________________
Title:_______________________________________
<PAGE> 41
SCHEDULE A
TO THE GLOBAL COLLATERAL DOCUMENTS AMENDMENT
1. Company Pledge Agreement, dated as of December 19, 1995, between
Fitzgeralds Gaming Corporation (the "Company"), and First Interstate
Bank of Nevada, N.A., as collateral agent (in such capacity, the
"Collateral Agent").
2. Subsidiary Pledge Agreement, dated as of December 19, 1995, among
Fitzgeralds South, Inc. ("FSI"), Fitzgeralds Reno, Inc. ("FRI"),
Fitzgeralds Incorporated ("FI"), Fitzgeralds Los Vegas, Inc.
("FLVI"), Fitzgeralds Fremont Experience Corporation ("FFEC"), Polk
Landing Entertainment Corporation ("PLEC"), Fitzgeralds Black Hawk,
Inc. ("FBHI" and together with FSI, FRI, FI, FLVI, FFEC and PLEC,
the "Subsidiary Guarantors"), the Company and the Collateral Agent.
3. Company Security Agreement, dated as of December 19, 1995, between
the Company and the Collateral Agent.
4. Subsidiary Security Agreement, dated as of December 19, 1995, among
the Subsidiary Guarantors, the Company and the Collateral Agent.
5. Company Accounts Pledge Agreement, dated as of December 19, 1995,
between the Company and First Interstate Bank of Nevada, N.A., as
trustee and Collateral Agent.
6. Disbursement and Escrow Agreement, dated as of December 19, 1995,
among FLVI, the Collateral Agent and First Interstate Bank of
Nevada, N.A., as escrow agent (the "Escrow Agent").
7. Disbursement and Escrow Agreement, dated as of December 19, 1995,
among PLEC, the Collateral Agent and the Escrow Agent.
8. Construction and Permanent Deed of Trust, Security Agreement and
Fixture Filing with Assignment of Rents, dated as of December 19,
1995, among PLEC, as trustor, First Interstate Bank of Nevada, N.A.,
as beneficiary, and Commonwealth Land Title Insurance Company, as
trustee.
9. Construction and Permanent Deed of Trust, Security Agreement and
Fixture Filing with Assignment of Rents, dated as of December 19,
1995, among FVLI and FRI, as trustor, First Interstate Bank of
Nevada, N.A., as beneficiary, and Nevada Title Company, as trustee.
10. Preferred Ship Mortgage, dated as of December 19, 1995, by PLEC in
favor of the Collateral Agent.
<PAGE> 42
SCHEDULE B
TO THE GLOBAL COLLATERAL DOCUMENTS AMENDMENT
1. Contractor's Subordination Agreement, dated October 11, 1995,
between the Company, the Collateral Agent, FLVI, Commonwealth Land
Title Insurance Company and Martin-Hartin Construction.
2. Contractor's Subordination Agreement, dated December 19, 1995,
between the Company, the Collateral Agent, PLEC, Commonwealth Land
Title Insurance Company and W.G. Yates & Sons Construction Company.
