EXHIBIT 10.104
INTERCREDITOR AGREEMENT
between
CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC
SUNAMERICA LIFE INSURANCE COMPANY
Dated: As of November 25, 1997
Company: Sahara Las Vegas Corp.
Loan Amount: $57,500,000
INTERCREDITOR AGREEMENT
TABLE OF CONTENTS
-----------------
Page
RECITALS............................................................................... 1
1. Interests of Holders......................................................... 1
2. Expenses..................................................................... 1
3. Subordination of Notes....................................................... 2
4. Equal Liens.................................................................. 7
5. Notes and Basic Documents.................................................... 7
6. Company Defaults, Acceleration, Enforcement Expenses......................... 8
7. Subordinate Holders Rights to Purchase the Senior Note....................... 9
8. Other Financing.............................................................. 10
9. Interest Not A Security...................................................... 10
10. Insolvency................................................................... 10
11. No Third-Party Beneficiaries................................................. 11
12. No Partnership............................................................... 11
13. No Warranty.................................................................. 11
14. Notices...................................................................... 11
15. Modification and Waiver...................................................... 12
16. Governing Law................................................................ 12
17. Binding Effect............................................................... 12
18. Entire Agreement............................................................. 13
19. Termination.................................................................. 13
20. Severability................................................................. 13
21. Counterparts................................................................. 13
22. No Assignment................................................................ 13
i
This Intercreditor Agreement (this "Agreement") is dated as of this 25th
day of November, 1997 by and among CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL
LLC, a Delaware limited liability company ("a "Senior Holder" and, together with
its successors and assigns, the "Senior Holders"), and SUNAMERICA LIFE INSURANCE
COMPANY, an Arizona corporation (a "Subordinate Holder" and together with its
successors and assigns, the "Subordinate Holders") (the Senior Holders and the
Subordinate Holders are sometimes herein referred to each individually as a
"Holder" and collectively as the "Holders").
RECITALS
--------
WHEREAS, the Holders and, SunAmerica Life Insurance Company, in its
capacity as the Collateral Agent (the "Collateral Agent") have made or are about
to enter into the Second Amended and Restated Note Purchase Agreement dated as
of the date hereof (as amended, modified or supplemented from time to time, the
"Note Purchase Agreement"), pursuant to which the Holders will acquire certain
secured notes (collectively, the "Loan") in the aggregate principal amount of
Fifty-Seven Million Five Hundred Thousand Dollars ($57,500,000) from Sahara Las
Vegas Corp., a Nevada corporation (the "Company"), comprised of Tranche A Notes
in the aggregate principal amount of $37,000,000, which is or will be in favor
of the Senior Holders (the "Senior Notes"), and Tranche B Notes in the aggregate
principal amount of $20,500,000, which is or will be in favor of the Subordinate
Holders (the "Subordinate Notes") (each a "Note" and, collectively, the
"Notes"). All terms not otherwise defined herein shall have the meanings set
forth in the Note Purchase Agreement.
WHEREAS, the Loan is or will be secured by a first deed of trust liens on
the Company's fee interests in certain real properties, together with
improvements thereon and related personal property owned by Company, referred to
as the Wet 'N' Wild Property and the Henderson Property, located in Las Vegas
and ▇▇▇▇▇▇▇▇▇, Nevada, respectively, certain 11% Mortgage Bonds issued by Santa
Fe Hotel, Inc. owned by Company and certain cash collateral and other property
(the "Security"), all as more particularly set forth in the Security Agreements
and other Basic Documents (as defined in the Note Purchase Agreement) (all Basic
Documents, including all instruments evidencing, securing or otherwise relating
to the Loan, as the same may be amended or modified in writing from time to time
are referred to herein as the "Basic Documents").
WHEREAS, the Holders desire to set forth the terms of their relationship as
co-lenders relating to the enforcement of, and their respective rights in, to
and under the Basic Documents and otherwise with respect to, the Loan.
NOW, THEREFORE, in consideration of the premises, and the mutual promises
set forth herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree as follows:
1. INTERESTS OF HOLDERS. No amount paid by any Senior Holder for the
--------------------
Senior Notes, and no amount paid by any Subordinate Holder for the Subordinate
Notes, shall be considered a loan by any Holder to any other Holder.
1
2. EXPENSES. In accordance with the Basic Documents, (a) a Holder or the
--------
Collateral Agent may make any payment for expenses under the Basic Documents or
an advance for the purposes of avoiding a threat to any lien created under the
Basic Documents, the priority of any lien created under the Basic Documents, or
a significant threat to the Security or the safety of any person at the Security
or in connection with the exercise of any rights or remedies under the Basic
Documents, including, without limitation, advances (i) to pay or discharge taxes
immediately prior to such time as such taxes may become a lien on the Security,
(ii) to pay insurance premiums no earlier than thirty (30) days prior to when
any policy may be cancelled for nonpayment of same, (iii) to pay the cost of
emergency repairs to protect the Security from damage or to minimize such
damage, (iv) to pay any amount which, if unpaid, might result in a lien on the
Security with priority over the lien or liens created under the Basic Documents
or (v) to pay any costs or expenses of the Collateral Agent in connection with
the exercise of any rights or remedies of the Collateral Agent under the Basic
Documents; (any such payment or advance, together with interest as provided in
the Basic Documents, shall be deemed an "Expense Advance"). Any Expense Advance
described in clause (i), or (ii) or (v) of the preceding sentence and any other
Expense Advance that is made with the consent of Requisite Tranche A Holders or
Requisite Tranche B Holders (any such Expense Advance, a "Senior Expense
Advance") shall be senior and superior in right of payment to the outstanding
principal balance of, prepayment premium (if any) and interest on, and all other
amounts due in respect of, the Notes and shall be pari passu with all other
Senior Expense Advances. Any Expense Advance that is not a Senior Expense
Advance shall be junior in right of payment to the outstanding principal balance
of, prepayment premium (if any) and interest on, and all other amounts due in
respect of the Notes and shall be pari passu with all other Expense Advances
that are not Senior Expense Advances.
3. SUBORDINATION OF NOTES.
----------------------
A. SUBORDINATE NOTE IS SUBORDINATE TO SENIOR NOTE.
----------------------------------------------
The Subordinate Holders covenant and agree that the Subordinate Note
is hereby expressly made subordinate and subject in right of payment to the
prior payment in full in cash or cash equivalents of the outstanding
principal balance of, prepayment premium (if any) and interest on, and all
other amounts due in respect of the Senior Notes but excluding the loan fee
payable pursuant to Section 2.4F of the Note Purchase Agreement (the
"Senior Obligations"). Notwithstanding the foregoing, at all times prior
to a Payment Blockage (as hereinafter defined) the Subordinate Holders may
receive and retain payments of the outstanding principal balance of,
prepayment premium (if any) and interest on, and all other amounts due in
respect of the Subordinate Notes (the "Subordinate Obligations"). Any
payments so received shall remain the property of the Subordinate Holders
and under no circumstances shall the Subordinated Holders be obligated to
deliver the same to any Senior Holder.
This Section 3 shall constitute a continuing obligation on the part of
any and all holders of the Subordinate Notes to all persons who become
holder(s) of or continue to hold the Senior Notes; and such provisions are
deemed made by any and all holders of the Subordinate Notes for the benefit
of the holder(s) of the Senior Notes; and such holder(s) of the Senior
Notes are deemed made obligees hereunder and they or each of them may
enforce such provisions.
The Holders agree that the additional loan fees payable to Credit
Suisse First Boston Mortgage Capital LLC and SunAmerica Life Insurance
Company pursuant to subsection 2.4F of the Note Purchase Agreement shall be
subordinate and subject in right of payment to the prior payment in full in
cash or cash equivalent of the Senior Obligations and the Subordinate
2
Obligations; provided, however, that this sentence shall not prohibit or
restrict the payment of the loan fee to Credit Suisse First Boston Mortgage
Capital LLC upon the payment in full of the Senior Notes so long as no
Event of Default has occurred and is continuing.
B. PAYMENT OVER OF PROCEEDS UPON BANKRUPTCY, ETC.
----------------------------------------------
In the event of (a) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relating to the Company or to its
assets, (b) any liquidation, dissolution or other winding-up of the
Company, whether voluntary or involuntary or (c) any assignment for the
benefit of creditors or any other marshalling of assets or liabilities of
the Company, then and in any such event:
(1) the holder(s) of the Senior Notes shall be entitled to
receive payment in full in cash or cash equivalents of the Senior
Obligations, whether or not such amount(s) are an allowed claim under
applicable law, before the holders of the Subordinate Notes are
entitled to receive any payment or distribution of any kind or
character on account of the Subordinate Obligations (other than Junior
Securities issued in connection with a reorganization pursuant to the
bankruptcy laws of any jurisdiction); and
(2) any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, by set-off
or otherwise, to which the holders of the Subordinate Notes would be
entitled but for the provisions of this Section 3B (other than Junior
Securities issued in connection with a reorganization pursuant to the
bankruptcy laws of any jurisdiction) shall be paid by the liquidating
trustee or agent or other person making such payment or distribution,
whether a trustee in bankruptcy, a receiver or liquidating trustee or
otherwise, directly to the holder(s) of the Senior Notes or their
representative or representatives, ratably according to the aggregate
amounts remaining unpaid on account of all of the Senior Obligations
held or represented by each, to the extent necessary to make payment
in full in cash or cash equivalents of the same after giving effect to
any concurrent payment or distribution to the holder(s) of the Senior
Notes; and
(3) in the event that, notwithstanding the foregoing provisions
of this Section 3B, any holder of a Subordinate Note shall have
received (after the occurrence of an event described in (a) through
(c) in the first grammatical paragraph of this Section 3B) any payment
or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, in respect of the Subordinate
Obligations (other than Junior Securities issued in connection with a
reorganization pursuant to the bankruptcy laws of any jurisdiction)
before the Senior Obligations are paid in full in cash or cash
equivalents or payment thereof provided for, then and in such event
such payment or distribution shall be received and held in trust for
the holder(s) of the Senior Notes and shall be paid over or delivered
forthwith to the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee, agent or other person making payment or
distribution of assets of the Company for application to the payment
of all of the Senior Obligations to the extent necessary to pay the
same in full in cash or cash equivalents after giving effect to any
concurrent payment or distribution to or for the holder(s) of the
Senior Notes.
3
(4) for purposes hereof, "Junior Securities" means securities
(including capital stock) issued by the Company to a Holder on account
of the Subordinate Notes that by their terms or by law are
subordinated to Senior Notes of the Company outstanding on the date of
issuance of such Junior Securities at least to the same extent as
provided herein. As used herein, "Senior Notes of Company outstanding
on the date of issuance of such Junior Securities" shall include
securities issued in connection with a reorganization pursuant to the
bankruptcy laws of any jurisdiction to persons which held the Senior
Notes in such reorganization proceeding.
(5) upon any payment or distribution of assets of the Company
referred to in this Agreement, the Collateral Agent and the Holders of
the Notes shall be entitled to rely upon any order or decree made by
any court of competent jurisdiction in which any insolvency,
bankruptcy, receivership, dissolution, winding-up, liquidation,
reorganization or similar case or proceeding is pending, or upon a
certificate of the receiver, trustee in bankruptcy, liquidating
trustee, receiver, assignee for the benefit of creditors, agent or
other person making such payment or distribution, delivered to the
Collateral Agent or the Holders of the Notes, for the purpose of
ascertaining the persons entitled to participate in such payment or
distribution, the Holders of the Notes and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other fact pertinent thereto or to
this Agreement.
C. SUSPENSION OF PAYMENT WHEN SENIOR NOTE IN DEFAULT.
-------------------------------------------------
(1) Unless Section 3B shall be applicable, upon the occurrence of
any default in the payment of principal, premium, if any, or interest
on the Senior Notes beyond any applicable cure period with respect
thereto (a "Payment Default"), no payment or distribution of any
assets of the Company of any kind or character may be made by or on
behalf of the Company on account of the Subordinate Obligations or by
or on behalf of the Company on account of the purchase, redemption or
other acquisition of the Subordinate Obligations (a "Payment
Blockage") unless and until such Payment Default shall have been cured
or waived or shall have ceased to exist or the Senior Obligations
shall have been paid in full in cash or cash equivalents, after which,
subject to Section 3B (if applicable), the making of any and all
required payments in respect of the Subordinate Obligations, including
any missed payments, may be resumed by or on behalf of the Company.
(2) Unless Section 3B shall be applicable, upon the occurrence of
any event (other than a Payment Default) the occurrence of which
entitles the Senior Holders to act to accelerate the maturity of the
Senior Note (a "Non-payment Default") and upon the earlier to occur of
(i) the receipt by the Company and the Collateral Agent
from the holder or holders representing not less than a majority
of the principal amount of the Senior Notes of written notice of
such occurrence stating that such notice is a payment blockage
notice pursuant to this Section 3C(2) or
(ii) if such Non-payment Default results from acceleration
of any Subordinate Notes, from the date of such acceleration.
4
there shall be a Payment Blockage for a period ("Payment Blockage
Period") commencing on the receipt by the Company and the Collateral
Agent of such notice or the date of acceleration referred to in clause
(ii) above, as the case may be, unless and until the earliest to occur
of the following events:
(w) 179 days shall have elapsed since receipt of such
written notice by the Company or the date of such acceleration
(provided the Senior Note shall not theretofore have been
accelerated),
(x) such Non-payment Default shall have been cured or waived
or shall have ceased to exist.
(y) the Senior Notes shall have been discharged or paid in
full in cash or cash equivalents, or
(z) such Payment Blockage Period shall have been terminated
by written notice to the Company or the Collateral Agent from the
holder or holders of the Senior Notes initiating such Payment
Blockage Period.
after which, in each case, the making of any and all required payments
in respect of the Subordinate Notes, including any missed payments,
may be resumed by or on behalf of the Company. During such Payment
Blockage Period, any payments in excess of amounts necessary to pay
the Senior Holders shall be held by the Collateral Agent.
Notwithstanding any other provision of this Agreement, only one
Payment Blockage Period may be commenced within any consecutive 365-
day period. No Non-payment Default with respect to the Senior Note
which existed or was continuing on the date of the commencement of any
Payment Blockage Period shall be, or be made, the basis for the
commencement of a second Payment Blockage Period, whether or not
within a period of 365 consecutive days, unless such default shall
have been cured or waived for a period of not less than 90 consecutive
days. In no event shall a Payment Blockage Period extend beyond 179
days from the receipt by the Company and the Collateral Agent of the
notice referred to in clause (i) above or the date of the acceleration
referred to in clause (ii) above and there must be a 186 consecutive
day period in any 365 consecutive day period during which no Payment
Blockage Period is in effect. In the event that such Non-payment
Default is not cured within the Payment Blockage Period, and the
Senior Holders accelerate the maturity of the indebtedness evidenced
by the Senior Notes, then the Senior Holders may instruct the
Collateral Agent to retain the funds received by it during such
Payment Blockage Period and apply the same to the Senior Obligations.
(3) In the event that, notwithstanding the foregoing, any holder
of any Subordinate Note shall have received any payment prohibited by
the foregoing provisions of this Section 3C, then and in such event
such payment shall be received and held in trust for the holder(s) of
the Senior Notes and shall be paid over and delivered forthwith to
such holder(s) of the Senior Notes or as a court of competent
jurisdiction shall direct for application to the payment of any Senior
Obligations, to the extent necessary to pay all such Senior
Obligations in cash or cash equivalents, after giving effect to any
concurrent payment or distributions to the holder(s) of the Senior
Note. However, in no event shall
5
any Subordinate Holders be required to hold in trust or return any
payment unless a Senior Holder shall have delivered notice of a
Payment Blockage to such Subordinate Holder.
D. NO WAIVER OF SUBORDINATION PROVISIONS.
-------------------------------------
(1) No right of any present or future holder of any Senior Note
to enforce subordination as herein provided shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part
of any Subordinate Holder, or by any non-compliance by any Subordinate
Holder with the terms, provisions and covenants of this Agreement,
regardless of any knowledge thereof any such holder may have or be
otherwise charged with, or by any non-compliance by the Company or any
other person with the terms, provisions and covenants of the Basic
Documents, regardless of any knowledge thereof any holder of any of
the Notes may have or be otherwise charged with.
(2) Without limiting the generality of Section 3D(1), any holder
of any Senior Note may, at any time and from time to time, without the
consent of or notice to the Company or any holder of the Subordinate
Notes except to the extent provided in the Basic Documents, without
incurring responsibility to any holder of the Subordinate Notes and
without impairing or releasing the subordination provided in this
Section 3 or the obligations hereunder of the holders of the
Subordinate Notes to the holder(s) of the Senior Notes, do any one, or
more of the following on behalf of all holders of the Notes: (a)
change the manner, place or terms of payments (other than increasing
the interest rate, principal amount or amortization of a Senior Note)
or extend the time of payment of, or renew or alter, a Senior Note or
any instrument evidencing the same or any agreement under which a
Senior Note is outstanding; (b) sell, exchange, release or otherwise
deal with any property or other collateral pledged, mortgaged or
otherwise securing a Senior Note (but in no event may any Senior
Holder release any collateral, or alter the priority of the lien,
securing any Subordinate Notes other than in the course of a
foreclosure thereof); (c) release any person liable in any manner for
the collection or payment of any Senior Note with respect to any
Senior Note (but in no event may a Senior Holder release any person
liable in any manner for the collection or payment of any Subordinate
Note with respect to any Subordinate Note other than in the course of
a foreclosure thereof); and (d) exercise or refrain from exercising
any rights against the Company and/or any other person. In connection
with the foregoing, no Senior Holder shall engage in a course of
conduct the primary purpose of which is to willfully and directly
impair the security of the Subordinate Holders collateral.
(3) No notice of acceleration issued by any Subordinate Holder
shall be effective (a) unless a copy thereof has been delivered to the
Senior Holders that have been identified to the Collateral Agent and
such Subordinate Holder and (b) until the earlier of (i) five (5)
business days after such notice has been delivered to the Company and
the Senior Holders or (ii) the acceleration of the Senior Notes.
E. SUBROGATION.
-----------
Subject to the payment in full in cash or cash equivalents of the
Senior Notes, the holders of the Subordinate Notes shall be subrogated
to the rights of the holder(s) of the Senior Notes to receive payments
or distributions of cash, property or securities of the
6
Company applicable to the Senior Notes until the Subordinate Notes
shall be paid in full; and, for the purposes of such subrogation, no
such payments or distributions to the holder(s) of the Senior Notes by
or on behalf of the Company or by or on behalf of the holders by
virtue of this Agreement which otherwise would have been made to the
holders of the Subordinate Notes shall, as between the Company and the
holders of the Subordinate Notes, be deemed to be a payment by the
Company to or on account of the Senior Notes, it being understood that
the provisions of this Agreement are and are intended solely for the
purpose of defining the relative rights of the holders of the
Subordinate Notes, on the one hand, and the holders of the Senior
Notes, on the other hand.
F. OBLIGATIONS OF THE COMPANY UNCONDITIONAL.
----------------------------------------
Nothing contained in this Agreement is intended to or shall
impair, as among the Company, its creditors other than the Holder(s)
of the Senior Notes, and the Holders of the Subordinate Notes, the
obligation of the Company, which is absolute and unconditional, to pay
to the holders of the Subordinate Notes, the principal of, prepayment
premium (if any) and any interest on and all other amounts due in
respect of the Subordinate Notes as and when the same shall become due
and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the holders of the Subordinate Notes and
creditors of the Company other than the holder(s) of the Senior Note,
nor shall anything herein or therein prevent the holders of the
Subordinate Notes from exercising all remedies otherwise permitted by
applicable law upon default under any Basic Document, subject to the
rights, if any, in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.
4. EQUAL LIENS. Each of the Holders shall have an interest in each item
-----------
of Security, each Security Document, and all proceeds thereof, equal to the
ratio of the obligations due such Holders to the aggregate obligations due both
Holders in all cases subject to the priority of payments set forth in Section 3
hereof, regardless of whether such Holder has been granted a lien or security
interest in such item of Security pursuant to the Security Document or otherwise
or whether the Basic Documents relating to such item of Security are in favor or
for the benefit of such Holders. Notwithstanding the date, manner, time or
order of attachment or perfection of any such lien or security interest, and
notwithstanding any provision of the applicable Uniform Commercial Code, any
applicable law or decision or any Security Document, or whether either of the
Holders holds possession of all or any part of such Security, the interest of
each Holder in each item of Security shall be a co-equal first and paramount
lien or security interest in such item of Security to the extent of such
interest without any preference or priority over the interest of the other
Holders in such item of Security, except as otherwise provided in Section 3
hereof.
5. NOTES AND BASIC DOCUMENTS.
-------------------------
A. REPRESENTATIONS AND WARRANTIES. None of the Holders makes or will
------------------------------
make any representation or warranty to any other party to this Agreement as
to the adequacy, validity or binding effect of the Notes or the Basic
Documents. Each Holder hereby represents and warrants to the other, by
execution of this Agreement, that it has not relied, is not relying and
will not rely upon the other Holders with respect to, and that it has made
or will make its own independent judgment with respect to, the following:
(i) the creditworthiness of the Company and any other
7
Credit Party, (ii) the adequacy, effectiveness, enforceability,
genuineness, validity or due execution of any of the Basic Documents or any
other documents referred to or provided for therein or in this Agreement;
(iii) any representation, warranty, document, certificate, report or
statement contained in the Basic Documents; (iv) the collectability of the
Loan, adequacy of collateral for the obligations of the Company and the
other Credit Parties under the Basic Documents, and all other underwriting
aspects of the Loan, (v) the existence, priority or perfection of any liens
or security interest granted or purported to be granted in connection with
any of the Basic Documents, or (v) observation of or compliance with any of
the terms, covenants or conditions of any of the documents on the part of
the Company and any other Credit Party. Each of the Holders further
represents and warrants to the other that it has knowledge and experience
in financial and business matters, it is capable of evaluating the risk of
the proposed investment in the Loan, it has received or has access to all
information required for making its investment decision regarding the Loan,
the interest of such Holders has not been registered under the Securities
Act of 1933, as amended, and it has made no separate or independent
agreement or contract with the Company or any other Credit Party with
respect to the Loan or the Security, except for the Basic Documents.
B. ORIGINALS. The Senior Holders shall retain the original Senior
---------
Notes, and the Subordinate Holders shall retain the original Subordinate
Notes. The Collateral Agent shall retain originals of all recorded and
unrecorded Basic Documents, and the initial Senior Holders and Subordinate
Holders shall receive duplicate originals of all unrecorded Basic Documents
and photocopies of all recorded Basic Documents.
▇. ▇▇▇▇▇▇ CERTIFICATIONS. Each Holder shall, at any time, upon
---------------------
request of any other Holder, deliver to the other a written statement
certifying the outstanding principal balance of its Note, whether it has
transferred or encumbered its interest in the Loan or the Security and if
so, the details relating to such transfer or encumbrance.
D. COMMUNICATIONS WITH COMPANY. Each of the Holders shall be
---------------------------
entitled to individually deal with and communicate with the Company and the
other Credit Parties, subject, in all events, to the terms and provisions
of Section 6 hereof and the Basic Documents.
E. The parties agree that, as to the relative obligations and rights
between the Senior Holders and the Subordinate Holders. In the event of
any conflict or inconsistency between the Basic Documents and this
Agreement, this Agreement shall control.
6. COMPANY DEFAULTS, ACCELERATION, ENFORCEMENT EXPENSES.
----------------------------------------------------
A. NOTICE OF LOAN DEFAULT. Prior to sending any notice of default to
----------------------
the Company, any Holder or Holders or a representative of such Holder or
Holders shall notify the other Holders of the existence and nature of any
act or omission by the Company or any other circumstance which would, with
or without the passage of time or giving of notice or both, give rise to a
right of the Holders to accelerate the Notes or exercise any other rights
or remedies under the Basic Documents (a "Loan Default"), to the extent
such Holder or Holders have actual knowledge of such Loan Default.
Thereafter, such Holder or Holders or a representative of such Holder or
Holders may deliver a notice of default to the Company.
8
B. NOTICE OF ACCELERATION. If, following a Loan Default and
----------------------
expiration of any applicable notice and cure periods, any Holder desires to
accelerate the maturity of its indebtedness and/or commence the exercise of
remedies under the Basic Documents, such Holders shall notify the other
Holders in writing of its desire to do so. The Holders will accelerate the
Notes as provided in the Note Purchase Agreement provided, however, if an
Event of Default under subsection 7.1 of the Note Purchase Agreement with
respect to the Senior Notes shall have occurred and be continuing for
ninety (90) days, Requisite Tranche A Holders (as defined in the Note
Purchase Agreement) may, by written notice to Company, declare all or a
portion of the amounts described in clause (i) in the provision immediately
following Section 7.14 of the Note Purchase Agreement relating to the
Senior Notes and all other Obligations owed to Holders of the Senior Notes
to be, and the same shall forthwith become, immediately due and payable;
provided further, if an Event of Default under subsection 7.1 of the Note
Purchase Agreement with respect to the Subordinate Notes shall have
occurred and be continuing for ninety (90) days, Requisite Tranche B
Holders (as defined in the Note Purchase Agreement) may, by written notice
to Company, declare all or a portion of the amounts described in clause (i)
in the provision immediately following Section 7.14 of the Note Purchase
Agreement relating to the Tranche B Notes and all other Obligations owed to
Holders of the Tranche B Notes to be, and the same shall forthwith become,
immediately due and payable.
C. ENFORCEMENT OF REMEDIES. Requisite Holders, either by themselves
-----------------------
or through the Collateral Agent, shall determine for the Holders what
remedies, if any, provided under the Basic Documents to utilize as provided
in the Basic Documents, including, without limitation, directing that one
or more the Notes be foreclosed upon, and when and how such remedies shall
be implemented. Notwithstanding the foregoing, if an Event of Default
under Section 7.1 of the Note Purchase Agreement has occurred and is
continuing for ninety (90) days with respect to the Tranche A Notes and
Requisite Holders have not initiated any foreclosure or similar proceedings
upon any Security, then Requisite Tranche A Holders may initiate and direct
foreclosure or similar proceedings upon any Security, it being understood
that to the extent that any direction by Requisite Holders and by Requisite
Tranche A Holders is in conflict or otherwise inconsistent, the direction
of Requisite Holders shall prevail. Any proceeds from such sale or
foreclosure in excess of the Senior Obligations shall be paid toward the
Subordinate Obligations before being returned to the Company. Except for
Sections 6D and 6E below, this Section 6 shall not apply in the event that
the Company becomes a debtor in a bankruptcy proceeding.
D. In any case commenced by or against the Company under Chapter 11
of the Bankruptcy Code or any similar provision thereof of any similar
federal or state statute (a "Reorganization Proceeding"), the Senior
-------------------------
Holders shall have the exclusive right to exercise any voting rights in
respect of the Senior Notes and the Subordinate Holders shall have the
exclusive right to exercise any voting rights in respect of the Subordinate
Notes against the Company, except that the Subordinate Holders shall not
have the right to vote affirmatively in favor of any plan of reorganization
unless the Holders of more than 50% in principal amount of the Senior Notes
grants its permission thereto or the Holders of more than 50% in principal
amount of the Senior Notes votes to accept such plan;
E. In any Reorganization Proceeding with respect to the Company, (i)
each Subordinate Holders shall file a proof of claim in respect of its
claims against the Company and shall send to Senior Holders a copy thereof
together with evidence of the filing with the appropriate court or other
authority, (ii) if any Subordinate Holder should fail to file such proof of
9
claim by the tenth (10th) business day before the last day for filing of
proofs of claim, or if the Holders of more than 50% in principal amount of
the Senior Notes reasonably believes that the proof of claim so filed is
less than the proper amount thereof, then the Holders of more than 50% in
principal amount of the Senior Notes may file such proof of claim, or
corrected proof of claim, on behalf of such Subordinate Holder, and (iii)
if objection is made to the allowance of any claim of any Subordinate
Holder, the Holders of more than 50% in principal amount of the Senior
Notes shall have the right to intervene and fully participate in such
proceedings and if such rights are denied and such Subordinate Holder fails
to defend such claim, the Holders of more than 50% in principal amount of
the Senior Notes may defend such claim in the name of such Subordinate
Holder.
7. SUBORDINATE HOLDERS RIGHTS TO PURCHASE THE SENIOR NOTES. At any time
-------------------------------------------------------
after delivery of notice by any Senior Holder to the Collateral Agent or the
Subordinate Holders that an "Event of Default" has occurred under any of the
Basic Documents, a Subordinate Holder or Holders representing more than 50% of
the Subordinate Notes (the "Majority Subordinate Holder") may deliver to the
Senior Holders a notice of election to purchase the Senior Note from the Senior
Holders for a purchase price equal to the Senior Obligations, excluding any
prepayment premium which would have been due had the Company prepaid the Senior
Notes at the time of such purchase or any fee payable upon the payment in full
of the Senior Notes, but including only the reasonable expenses of such Note
purchase. At any time within twenty (20) days after the Majority Subordinate
Holder(s) has delivered such notice to the Senior Holders (time being of the
essence), a Senior Holder or Holders representing more than 50% of the Senior
Notes (the "Majority Senior Holder") may deliver to the Subordinate Holders a
notice of election to purchase the Subordinate Notes from the Subordinate
Holders for a purchase price equal to the Subordinate Obligations, excluding any
prepayment premium which would have been due had the Company prepaid the
Subordinate Notes at the time of such purchase or any fee payable upon the
payment in full of the Subordinate Notes, but including only the reasonable
expenses of such Note purchase. Either of such notices notice shall set forth
the date (no earlier than ten (10) days, nor later than forty-five (45) days,
after the date of delivery of such notice) on which such Holder(s) shall tender
such purchase price in immediately available funds to the other Holder(s) and
each other Holder(s) is to tender its Note duly endorsed, without
representation, warranty or recourse, to the purchasing Holder(s), together with
an assignment, in due form for recording, of all of such other Holder's right,
title and interest in and to the Loan and the Basic Documents. On the appointed
day and at the appointed time (time being of the essence), each party shall make
its tenders. Each party shall bear its own expenses in connection with such
purchase, but the purchasing Holder(s) shall pay any and all filing and/or
recording charges, fees and/or taxes in connection therewith. If the Majority
Senior Holder timely delivers its notice to the Subordinate Holders, then the
Majority Senior Holders shall be the purchasing Holder. If the Majority
Subordinate Holders timely delivers its notice to the Majority Senior Holder,
but the Majority Senior Holder fails to timely deliver its notice to the
Subordinate Holders, then such Majority Subordinate Holder shall be the
purchasing Holder. Any such notice shall be binding, non-contingent and
irrevocable.
8. OTHER FINANCING. Without limiting rights to which each of the Holders
---------------
otherwise is or may become entitled, none of the Holders shall have any interest
solely by virtue of this Agreement in (a) any present or future loans from,
letters of credit issued by, or leasing, note, or other financing transactions
by any other Holder(s) or any affiliate thereof to, or on behalf of, or with the
Company, any other Credit Party or any affiliate thereof (collectively, the
"Other Financing") other than as provided under the Basic Documents or as
expressly provided in this Agreement, (b) any present or future guaranties by or
for the account of the Company, any other Credit Party or any affiliate thereof
in connection with such Other Financing, (c) any present or future offset
exercised by any other Holder in
10
respect of such Other Financing, (d) any present or future property taken as
security for any such Other Financing, or (e) any property now or hereafter in
the possession or control of any other Holder which may be or become security
for the obligations of the Company, any other Credit Party or any affiliate
thereof arising under any loan document by reason of the general description of
indebtedness secured or of property contained in any other agreements,
documents, or instruments related to any such Other Financing; provided,
however, that if payments in respect of such guaranties or such property or the
proceeds thereof shall be applied to the obligations of the Company arising
under the Basic Documents, then each Holder shall be entitled to share in the
amounts so applied in accordance with Section 3 hereof.
9. INTEREST NOT A SECURITY. Each of the Holders represents and warrants
-----------------------
to the others that (a) such Holder does not consider its interest in the Loan to
constitute the "purchase" or "sale" of a "security" within the meaning of the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, or Rule 10b-5 promulgated thereunder, the Trust Indenture Act of 1939,
as amended, or any other applicable securities statute or law, or any rule or
regulation under any of the foregoing (collectively, the "Acts"), (b) such
Holder has no expectation that it will derive profits from the efforts of any
other Holder or any third party in respect of the acquisition of such Holder's
Note hereunder, (c) such Note merely constitutes a commercial transaction by
such Holder with the Company and the other Credit Parties and the other Holder
and does not represent an "investment" (as that term is commonly understood) in
any other Holder or the Company or any other Credit Party, (d) such Holder is
acquiring its Note for its own account in respect of a commercial transaction
made in the ordinary course of its business and not with a view to or in
connection with any subdivision, resale, or distribution thereof, and (e) such
Holder can bear the economic risk related to the purchase of the same, and has
had access to all information deemed necessary by it in making its decision
whether or not to purchase the same.
10. INSOLVENCY. In the event that (a) a Holder becomes insolvent or makes
----------
a transfer in fraud of creditors, or makes a general assignment for the benefit
of creditors, or admits in writing its inability to pay its debts as they become
due or is generally not paying its debts as such debts become due, or (b) a
receiver, trustee or custodian is appointed for, or takes possession of, all or
substantially all of the assets of a Holder, either in a proceeding brought by
such Holder or in a proceeding brought against such Holder, and such appointment
is not discharged or such possession is not terminated within sixty (60) days
after the effective date thereof or such Holder consents to or acquiesces in
such appointment or possession, or (c) a Holder files a petition for relief
under the Bankruptcy Code, as amended, or any other present or future federal or
state insolvency, bankruptcy or similar law (collectively, "applicable
Bankruptcy Law") or an involuntary petition for relief is filed against a Holder
under any applicable Bankruptcy Law and such petition is not dismissed within
sixty (60) days after the filing thereof, or an order for relief naming a Holder
is entered under any applicable Bankruptcy Law, or any composition,
rearrangement, extension, reorganization or other relief of debtors now or
hereafter existing is requested or consented to by a Holder, or (d) the interest
of a Holder in the Loan or any part thereof is taken on execution or other
process of law in any action against such Holder, or (e) the Holder is taken
over or subject to rehabilitation by any Commissioner of Insurance or state or
federal regulatory agency (a Holder who becomes insolvent or makes a transfer in
fraud of creditors or who is otherwise described by clauses (a) through (e)
above is hereinafter called an "Insolvent Holder"), to the extent the Insolvent
Holder holds Senior Notes, then any other Holder that holds Senior Notes or, to
the extent the Insolvent Holder holds the Subordinate Notes, then any other
Holder that holds Subordinate Notes (any such Holder, a "Solvent Holder") shall
have the right, but not the obligation, to purchase the Insolvent Holder's Note.
In order to exercise this right, such Solvent Holder shall give written notice
to the Insolvent Holder of its intention to exercise such option and shall
conclude the purchase of the Insolvent Holder's Note as soon as reasonably
practicable thereafter. The purchase price for the Insolvent Holder's Note shall
be the appraised fair market value thereof. In the
11
event a Solvent Holder acquires the interest of the Insolvent Holder pursuant to
this Section 10, such Solvent Holder shall, on request of the Insolvent Holder,
certify in writing that it is acquiring such Note for the purpose of investment
and not with a view to such distribution thereof within the meaning of the
Securities Act of 1933, as amended, and the Insolvent Holder shall deliver to
the Solvent Holder (i) such of the original Basic Documents as are in the
Insolvent Holder's possession, if any, (ii) an assignment of all of the
Insolvent Holder's right, title and interest in the Loan and the Basic
Documents, and (iii) such evidence of the Insolvent Holder's existence, good
standing and authority and the due execution and delivery by the Insolvent
Holder of the assignment and any documents related thereto.
11. NO THIRD-PARTY BENEFICIARIES. This Agreement is made and entered into
----------------------------
for the sole protection and benefit of the parties and their successors and
permitted assigns and nothing in this Agreement, whether express or implied,
shall inure to the benefit of, or confer any rights or remedies upon the
Company, any other Credit Party or any person other than the Holders and their
permitted successors and assigns. Consequently, the Company, the other Credit
Parties and any person other than the Holders shall not be entitled to rely upon
or raise as a defense, in any manner whatsoever, the failure of any Holders to
comply with the provisions of this Agreement or any other intercreditor
agreement among any Holders.
12. NO PARTNERSHIP. Neither the execution of this Agreement, nor the
--------------
ownership of interests in the Loan or the security for the Loan is intended to
be, nor shall it be construed to be, the formation of a partnership, trust,
joint venture or agency between the parties. In addition, no Holder owes any
fiduciary duty to any other Holder with respect to the making, administration
and/or enforcement of the Loan, but is obligated to exercise good faith.
13. NO WARRANTY. No provision of this Agreement will be construed as a
-----------
warranty or guaranty by any Subordinate Holder or Senior Holder as to future
payments by the Company or any other person obligated to pay the Loan.
14. NOTICES. All notices, consents, demands, requests and other
-------
communications pursuant to this Agreement shall be deemed to have been properly
given, when made in writing, three business days after receipt, when delivered
personally or when sent either through United States Postal Service post-paid,
registered or certified mail with return receipt requested or by overnight mail
(such as Airborne, Federal Express, Purolator or similar service) at the expense
of the sender, addressed to the Senior Holders or the Subordinate Holders to
receive such notice at the following addresses or at such address as may
hereafter be specified by written notice given as set forth in this Section 14:
If to CSFB: Credit Suisse First Boston Mortgage
Capital LLC
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Cadwalder, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
12
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to SunAmerica: SunAmerica Life Insurance Company
SunAmerica, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ III
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: O'Melveny & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
15. MODIFICATION AND WAIVER. This Agreement may be modified, amended or
-----------------------
cancelled and compliance with any of its provisions waived, only by an
instrument in writing executed by all the parties hereto. No failure by any
party hereto to enforce compliance with any provision hereof at any time shall
affect the right at a later time to enforce its compliance. No waiver of
compliance with any provision hereof in any instance by any party shall, except
as otherwise provided in the instrument granting such waiver, operate as or be
construed as a further or continuing waiver of compliance with such provision or
other provision. The parties hereto waive the right to trial by jury.
16. GOVERNING LAW. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of New York, without giving consideration
to principles of conflict of law.
17. BINDING EFFECT. This Agreement shall inure to the benefit of and be
--------------
binding on the parties hereto and their respective successors and assigns, and
the successors and assigns of all or any part of the interest of any party
hereto. Any Holder party may endorse, assign, sell or otherwise transfer its
Note or Notes as provided in the Note Purchase Agreement; provided that any such
endorsement, assignment, sale or transfer shall be made expressly subject to
this Agreement and such Holder shall cause such buyer, assignee or transferee to
unconditionally and irrevocably agree to be bound by all of the provisions
hereof and deliver an Intercreditor Assumption Agreement to the other Holders in
the form of Exhibit A hereto. In the event that any Holder defaults in any of
its obligations hereunder, the other Holders have the right to seek specific
performance of such Holder's obligations hereunder.
18. ENTIRE AGREEMENT. This Agreement sets forth the entire Agreement and
----------------
understanding of the parties hereto with respect to the transactions
contemplated hereby and the subject matter hereof and supersedes all prior
agreements or understandings relating thereto.
19. TERMINATION. This Agreement shall remain in full force and effect so
-----------
long as the Holders, their successors and permitted assigns shall have any
interest in any portion of the Loan or the Security, including, without
limitation, after acquisition of the Security by both Holders through
foreclosure, deed in lieu of foreclosure, or otherwise.
13
20. SEVERABILITY. Any provision of this Agreement which is prohibited or
------------
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. To the extent permitted by applicable law, the parties
hereto waive any provision of law which prohibits or renders unenforceable any
provision hereof.
21. COUNTERPARTS. This Agreement may be executed in counterparts, each of
------------
which shall be deemed an original and all of which, when taken together, shall
constitute one and the same instrument, binding on the Holders, and the
signature of any party to any counterpart shall be deemed a signature to, and
may be appended to, any other counterpart.
22. NO ASSIGNMENT. This Agreement may not be assigned, except in
-------------
connection with the endorsement, assignment, sale or other transfer of such
assignor's Note.
14
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
CREDIT SUISSE FIRST BOSTON MORTGAGE
CAPITAL LLC
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Its: Vice President
SUNAMERICA LIFE INSURANCE COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. Hanover
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. Hanover
Its: Authorized Agent
Acknowledged (including with
respect to Section 11 hereof):
SAHARA LAS VEGAS CORP.
By: /s/ ▇▇▇▇▇▇ ▇. Land
------------------------------
Name: ▇▇▇▇▇▇ ▇. Land
Its: Treasurer & Asst. Secretary
S-1
