Exhibit 10.4
DEED OF TRUST NOTE
$10,000,000 June 26, 1997
Pittsburgh, Pennsylvania
The undersigned, COLONIAL DOWNS, L.P., a Virginia limited partnership,
having its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇. Box 456, Providence
Forge, Virginia 23140 (the "Borrower"), promises to pay to the order of PNC
BANK, NATIONAL ASSOCIATION, a national banking association (the "Bank"), at its
principal office located at One PNC Plaza, Real Estate Banking, P1-▇▇▇▇-19-2,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, the principal sum of TEN
MILLION DOLLARS ($10,000,000) lawful money of the United States of America, or
so much thereof as shall have been advanced under that certain Construction Loan
Agreement (the "Loan Agreement") of even date herewith by and between Borrower
and the Bank, and to pay interest from the date of the initial advance on the
unpaid balance of the principal sum hereof in like money at the rates per annum
hereinafter set forth, payable as follows:
A. Beginning on August 1, 1997 and on the first (1st) day of each
calendar month thereafter, ▇▇▇▇▇▇▇▇ shall pay interest on the outstanding
principal amount of advances evidenced hereby at the rates specified and subject
to the terms and conditions set forth in Article 3 of, and as otherwise provided
in, the Loan Agreement.
B. Beginning on the first (1st) day of each calendar quarter during the
Amortization Period and on the first day of each calendar quarter thereafter,
throughout the remaining term of the Construction Loan, the Borrower shall make
quarterly payments of the outstanding principal balance of the Construction Loan
in the amount of Five Hundred Thousand Dollars ($500,000) each.
C. Subject to the provisions of Section 2.4 of the Loan Agreement, the
entire outstanding principal hereof, together with all unpaid interest at the
aforesaid rate, shall be due and payable on June 30, 2000, which date is
thirty-six (36) months following the date hereof, exclusive of all duly
exercised extension options, unless earlier due by acceleration or otherwise
(the "Expiration Date").
All capitalized terms employed herein shall have the meanings ascribed
thereto in the Loan Agreement unless otherwise defined herein. Upon the
occurrence and during the continuation of any Remedies Event specified in the
Loan Agreement, Borrower shall pay interest on the entire principal amount then
outstanding and all other sums due at the Default
Rate specified in Section 3.3 of the Loan Agreement. Said interest rate shall
accrue before and after any judgment has been entered. Borrower shall also pay a
late payment charge, upon demand, as specified in Section 3.3 of the Loan
Agreement on any payment due hereunder, or under the Loan Agreement which is not
received within ten (10) days after the date such payment is due.
This Note is secured, inter alia, by a certain Deed of Trust and
Security Agreement (the "Deed of Trust ") of even date herewith from Borrower
and Colonial Downs Holdings, Inc., a Virginia corporation to Lawyers Title
Realty Services, Inc., a Virginia corporation as Trustee for the benefit of the
Bank, covering certain property more particularly described therein. This Note
is the Deed of Trust Note referred to in, and is entitled to the benefits of,
the Loan Agreement and other Loan Documents, including the representations,
warranties, covenants, conditions, security interests and liens contained or
granted therein. The Loan Agreement, among other things, contains provisions for
acceleration of the maturity hereof upon the happening of certain stated events
and also for prepayments, in certain circumstances, on account of principal
hereof prior to maturity upon the terms and conditions therein specified.
Borrower may prepay this Note in whole or in part only in accordance
with the terms set forth in Sections 3.9 and 3.10 of the Loan Agreement. All
partial prepayments shall be applied in the manner set forth in Section 3.11 of
the Loan Agreement.
Notwithstanding any provision of this Note to the contrary, it is the
intent of Borrower and the Bank that the Bank shall not at any time be entitled
to receive, collect or apply, and Borrower and the Bank shall not be deemed to
have contracted for, as interest on the principal indebtedness evidenced hereby,
any amount in excess of the maximum rate of interest permitted to be charged by
applicable Law, and in the event the Bank ever receives, collects or applies as
interest any such excess, such excess shall be deemed partial payment of the
principal indebtedness evidenced hereby, and if such principal shall be paid in
full, any such excess shall forthwith be paid to Borrower.
No delay or omission on the part of the Bank or of any holder hereof in
exercising any right hereunder or under the Loan Agreement shall operate as a
waiver of such right or of any other right of such holder, nor shall any delay,
omission or waiver on any one occasion be deemed a bar to or waiver of the same
or any other right on any future occasion. Borrower and every endorser of this
Note, regardless of the time, order or place of signing, consent to any one or
more extensions or postponements of the time of payment or any other
indulgences, to any substitutions, exchanges, renewals or releases of collateral
for this Note, and to the additions or releases of any other parties or persons
primarily or secondarily liable.
The rights and obligations of the parties under this Note shall be
governed by and interpreted and enforced in accordance with the substantive laws
of the Commonwealth of Pennsylvania, without giving effect to the principles of
conflict of laws.
The obligations and liability of the Borrower hereunder shall not be
subject to any counterclaim, recoupment, set-off, reduction or defense based
upon any claim that the Borrower may have against the Bank.
No change, modification or amendment to any term or provision of this
Note shall be valid unless consented to in writing by the Bank and the Borrower.
Borrower hereby waives presentment for payment, demand, protest, notice
of protest and notice of dishonor, and notice of non-payment.
CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO
THE NONEXCLUSIVE JURISDICTION OF THE COURT OF COMMON PLEAS OF ALLEGHENY COUNTY
AND THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA,
AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL
SUCH SERVICE OF PROCESS BE MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO THE
BORROWER AT THE ADDRESSES PROVIDED FOR IN THE FIRST PARAGRAPH HEREOF AND SERVICE
SO MADE SHALL BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. THE
BORROWER WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED
AGAINST IT AS PROVIDED ▇▇▇▇▇▇ AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK
OF JURISDICTION OR VENUE.
WAIVER BY JURY TRIAL. EACH OF BORROWER AND BANK WAIVES THE RIGHT TO A
TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON OR RELATED TO THE SUBJECT
MATTER OF THIS NOTE OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY OF THE
TRANSACTIONS RELATED TO ANY OF THE LOAN DOCUMENTS. THIS WAIVER IS KNOWINGLY,
INTENTIONALLY AND VOLUNTARILY MADE BY ▇▇▇▇▇▇▇▇ AND BANK AND BORROWER AND BANK
EACH ACKNOWLEDGES THAT NEITHER BORROWER NOR BANK NOR ANY PERSON ACTING ON BEHALF
OF BORROWER OR BANK HAS OR HAVE MADE ANY REPRESENTATIONS OF FACT TO INDUCE THIS
WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT. EACH OF
BORROWER AND BANK FURTHER ACKNOWLEDGES THAT EACH PARTY HAS BEEN REPRESENTED (OR
HAS HAD THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF THIS AGREEMENT AND
IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN
FREE WILL, AND THAT EACH PARTY HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER
WITH COUNSEL. ▇▇▇▇▇▇▇▇ AGREES THAT THE OBLIGATIONS EVIDENCED BY THIS NOTE ARE
EXEMPTED TRANSACTIONS UNDER THE TRUTH-IN-LENDING ACT, 15 U.S.C. SECTION 1061, ET
SEQ.
Borrower shall have the right to assign this Note only in accordance
with Section 11.11 of the Loan Agreement.
This Note shall bind Borrower and ▇▇▇▇▇▇▇▇'s successors and assigns and
the benefits hereof shall inure to the benefit of the Bank and the Bank's
successors and assigns. All references herein to the "Borrower" and the "Bank"
shall be deemed to apply to the Borrower and the Bank, respectively, and their
respective successors and assigns.
This is a sealed instrument.
[REMAINDER OF ▇▇▇▇ LEFT INTENTIONALLY BLANK]
WITNESS the due execution of this Note as of the day and year first
above written.
ATTEST: COLONIAL DOWNS, L.P.,
a Virginia limited partnership
By: STANSLEY RACING CORP.,
a Virginia corporation,
its sole general partner
___________________________ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: --------------------------------
Title: Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: CEO
STATE OF )
)ss
COUNTY OF )
On this _____ day of ____________, 1997, before me, a notary public, personally
appeared ______________________________________, who acknowledged
himself/herself to be the _______________________ STANSLEY RACING CORP., a
Virginia corporation, the general partner of COLONIAL DOWNS, L.P., a Virginia
limited partnership, and that he/she, as such officer, being authorized to do
so, executed the foregoing instrument for the purposes therein contained by
signing the name of the corporation as the general partner of said limited
partnership by himself/herself as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
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Notary Public
My Commission expires:
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