THIS INDENTURE IS, FOR PURPOSES OF TITLE 38 OF THE COLORADO REVISED STATUTES,
THE "ORIGINAL EVIDENCE OF INDEBTEDNESS" SECURED BY THE DEED OF TRUST (AS DEFINED
HEREIN).
--------------------------------------------------------------------------------
RIVIERA BLACK HAWK, INC.
$45,000,000
13% FIRST MORTGAGE NOTES DUE 2005
WITH CONTINGENT INTEREST
---------------------------
INDENTURE
Dated as of June 3, 1999
---------------------------
IBJ WHITEHALL BANK & TRUST COMPANY
Trustee
--------------------------------------------------------------------------------
CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310(a)(1)................................................ 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.
(a)(4).............................................. N.A.
(a)(5).............................................. 7.10
(b)................................................. 7.10
(c)................................................. N.A.
311(a)................................................... 7.11
(b)................................................. 7.11
(c)................................................. N.A.
312(a)................................................... 2.05
(b)................................................. 11.03
(c)................................................. 11.03
313(a)................................................... 7.06
(b)(1).............................................. 10.03
(b)(2).............................................. 7.07
(c)................................................. 7.06;11.02
(d)................................................. 7.06
314(a)................................................... 4.03;11.02
(b)................................................. 10.02
(c)(1).............................................. 11.04
(c)(2).............................................. 11.04
(c)(3).............................................. N.A.
(d).......................................... 10.03, 10.04, 10.05
(e)................................................. 11.05
(f)................................................. N.A.
315(a)................................................... 7.01
(b)................................................. 7.05,11.02
(c)................................................. 7.01
(d)................................................. 7.01
(e)................................................. 6.11
316(a) (last sentence)................................... 2.09
(a)(1)(A)........................................... 6.05
(a)(1)(B)........................................... 6.04
(a)(2).............................................. N.A.
(b)................................................. 6.07
(c)................................................. 2.12
317(a)(1)................................................ 6.08
(a)(2).............................................. 6.09
(b)................................................. 2.04
318(a)................................................... 11.01
(b)................................................. N.A.
(c)................................................. 11.01
N.A. means not applicable.
* This Cross Reference Table is not part of the Indenture.
i
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.........................................................................................1
Section 1.02. Other Definitions..................................................................................23
Section 1.03. Incorporation by Reference of Trust Indenture Act..................................................24
Section 1.04. Rules of Construction..............................................................................24
ARTICLE 2 THE NOTES
Section 2.01. Form and Dating....................................................................................25
Section 2.02. Execution and Authentication.......................................................................26
Section 2.03. Registrar and Paying Agent.........................................................................26
Section 2.04. Paying Agent to Hold Money in Trust................................................................26
Section 2.05. Holder Lists.......................................................................................27
Section 2.06. Transfer and Exchange..............................................................................27
Section 2.07. Replacement Notes..................................................................................39
Section 2.08. Outstanding Notes..................................................................................39
Section 2.09. Treasury Notes.....................................................................................40
Section 2.10. Temporary Notes....................................................................................40
Section 2.11. Cancellation.......................................................................................40
Section 2.12. Defaulted Interest.................................................................................40
Section 2.13. CUSIP Number.......................................................................................41
Section 2.14. Exchange Registration..............................................................................41
ARTICLE 3 REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.................................................................................41
Section 3.02. Selection of Notes to Be Redeemed..................................................................41
Section 3.03. Notice of Redemption...............................................................................42
Section 3.04. Effect of Notice of Redemption.....................................................................42
Section 3.05. Deposit of Redemption Price........................................................................43
Section 3.06. Notes Redeemed in Part.............................................................................43
Section 3.07. Optional Redemption................................................................................43
Section 3.08. Mandatory Redemption...............................................................................44
Section 3.09. Gaming Redemption..................................................................................44
Section 3.10. Offer to Purchase by Application of Excess Proceeds................................................45
ARTICLE 4 COVENANTS
Section 4.01. Payment of Notes...................................................................................47
Section 4.02. Maintenance of Office or Agency....................................................................47
Section 4.03. Reports............................................................................................48
Section 4.04. Compliance Certificate.............................................................................48
Section 4.05. Taxes..............................................................................................49
Section 4.06. Stay, Extension and Usury Laws.....................................................................49
Section 4.07. Restricted Payments................................................................................49
Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries.....................................52
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock.........................................52
Section 4.10. Asset Sales........................................................................................55
Section 4.11. Transactions with Affiliates.......................................................................56
ii
Section 4.12. Liens..............................................................................................57
Section 4.13. Line of Business...................................................................................57
Section 4.14. Corporate Existence................................................................................58
Section 4.15. Offer to Repurchase Upon Change of Control.........................................................58
Section 4.16. Limitation on Sale and Leaseback Transactions......................................................59
Section 4.17. Limitation on Issuances and Sales of Equity Interests in Wholly Owned Subsidiaries.................59
Section 4.18. Advances to Subsidiaries...........................................................................60
Section 4.19. Payments for Consent...............................................................................60
Section 4.20. Additional Subsidiary Guarantees...................................................................60
Section 4.21. Insurance..........................................................................................60
Section 4.22. Limitation on Status as Investment Company.........................................................62
Section 4.23. Further Assurances.................................................................................62
Section 4.24. Construction.......................................................................................62
Section 4.25. Limitation on Use of Proceeds......................................................................62
Section 4.26. Collateral Documents, Completion Capital Commitment and Keep-Well Agreement........................63
Section 4.27. Restriction on Payment of Management Fees..........................................................63
Section 4.28. Event of Loss......................................................................................64
Section 4.29. Excess Cash Purchase Offers........................................................................65
ARTICLE 5 SUCCESSORS
Section 5.01. Xxxxxx, Consolidation, or Sale of Assets...........................................................65
Section 5.02. Successor Corporation Substituted..................................................................66
ARTICLE 6 DEFAULTS AND REMEDIES
Section 6.01. Events of Default..................................................................................67
Section 6.02. Acceleration.......................................................................................69
Section 6.03. Other Remedies.....................................................................................69
Section 6.04. Waiver of Past Defaults............................................................................69
Section 6.05. Control by Majority................................................................................70
Section 6.06. Limitation on Suits................................................................................70
Section 6.07. Rights of Holders of Notes to Receive Payment......................................................70
Section 6.08. Collection Suit by Trustee.........................................................................71
Section 6.09. Trustee May File Proofs of Claim...................................................................71
Section 6.10. Priorities.........................................................................................71
Section 6.11. Undertaking for Costs..............................................................................72
ARTICLE 7 TRUSTEE
Section 7.01. Duties of Trustee..................................................................................72
Section 7.02. Rights of Trustee..................................................................................74
Section 7.03. Individual Rights of Trustee.......................................................................74
Section 7.04. Trustee's Disclaimer...............................................................................74
Section 7.05. Notice of Defaults.................................................................................75
Section 7.06. Reports by Trustee to Holders of the Notes.........................................................75
Section 7.07. Compensation and Indemnity.........................................................................76
Section 7.08. Replacement of Trustee.............................................................................77
Section 7.09. Successor Trustee by Xxxxxx, etc...................................................................78
Section 7.10. Eligibility; Disqualification......................................................................78
Section 7.11. Preferential Collection of Claims Against Company..................................................78
iii
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance...........................................78
Section 8.02. Legal Defeasance and Discharge.....................................................................79
Section 8.03. Covenant Defeasance................................................................................79
Section 8.04. Conditions to Legal or Covenant Defeasance.........................................................80
Section 8.05. Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions......81
Section 8.06. Repayment to Company...............................................................................81
Section 8.07. Reinstatement......................................................................................82
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes................................................................82
Section 9.02. With Consent of Holders of Notes...................................................................83
Section 9.03. Compliance with Trust Indenture Act................................................................84
Section 9.04. Revocation and Effect of Consents..................................................................84
Section 9.05. Notation on or Exchange of Notes...................................................................85
Section 9.06. Trustee to Sign Amendments, etc....................................................................85
ARTICLE 10 COLLATERAL AND SECURITY
Section 10.01. Security..........................................................................................85
Section 10.02. Recording and Opinions............................................................................86
Section 10.03. Release of Collateral.............................................................................87
Section 10.04. Certificates of the Company.......................................................................88
Section 10.05. Certificates of the Trustee.......................................................................88
Section 10.06. Authorization of Actions to Be Taken by the Trustee Under the Collateral Documents................88
Section 10.07. Authorization of Receipt of Funds by the Trustee Under the Collateral Documents...................89
Section 10.08. Termination of Security Interest..................................................................89
Section 10.09. Cooperation Of Trustee............................................................................89
Section 10.10. Collateral Agent..................................................................................90
ARTICLE 11 MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls......................................................................90
Section 11.02. Notices...........................................................................................90
Section 11.03. Communication by Holders of Notes with Other Holders of Notes.....................................91
Section 11.04. Certificate and Opinion as to Conditions Precedent................................................91
Section 11.05. Statements Required in Certificate or Opinion.....................................................92
Section 11.06. Rules by Trustee and Agents.......................................................................92
Section 11.07. No Personal Liability of Directors, Officers, Employees and Stockholders..........................92
Section 11.08. Governing Law.....................................................................................92
Section 11.09. No Adverse Interpretation of Other Agreements.....................................................93
Section 11.10. Successors........................................................................................93
Section 11.11. Severability......................................................................................93
Section 11.12. Counterpart Originals.............................................................................93
Section 11.13. Table of Contents, Headings, etc..................................................................93
Section 11.14. Gaming and Liquor Laws............................................................................93
iv
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E FORM OF INTERCOMPANY NOTE
Exhibit F FORM OF PLEDGE AGREEMENT
Exhibit G FORM OF COLLATERAL ASSIGNMENT OF PATENT
Exhibit H FORM OF COLLATERAL ASSIGNMENT OF COPYRIGHT
Exhibit I FORM OF SUPPLEMENTAL INDENTURE
v
THIS INDENTURE IS, FOR PURPOSES OF TITLE 38 OF THE COLORADO REVISED STATUTES,
THE "ORIGINAL EVIDENCE OF INDEBTEDNESS" SECURED BY THE DEED OF TRUST (AS DEFINED
HEREIN).
INDENTURE dated as of June 3, 1999, between Riviera Black Hawk, Inc., a
Colorado corporation (the "Company"), and IBJ Whitehall Bank & Trust Company, as
trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each other
and for the equal and ratable benefit of the Holders (as defined below) of the
13% Series A First Mortgage Notes due 2005 With Contingent Interest (the "Series
A Notes") and the 13% Series B First Mortgage Notes due 2005 With Contingent
Interest (the "Series B Notes" and, together with the Series A Notes, the
"Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions
"144A Global Note" means a global note substantially in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, whether or
not such Indebtedness is incurred in connection with, or in contemplation of,
such other Person merging with or into, or becoming a Subsidiary of, such
specified Person; and (ii) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.
"Additional Notes" means additional Notes (other than the Initial Notes)
issued under this Indenture, as part of the same series as the Initial Notes.
"Adjusted Fixed Charge Coverage Ratio" means, with respect to any Person
for any period, the ratio of the Consolidated Cash Flow of such Person and its
Subsidiaries for such period to Adjusted Fixed Charges of such Person and its
Subsidiaries for such period (calculated in the same manner as the Fixed Charge
Coverage Ratio is calculated).
"Adjusted Fixed Charges" means, with respect to any Person for any period,
the Fixed Charges of such Person and its Subsidiaries for such period plus any
Contingent Interest accrued with respect to the Consolidated Cash Flow of such
Person and its Subsidiaries for such period.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person shall be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" shall have correlative meanings.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or exchange of
or for beneficial interests in any Global Note, the rules and procedures of the
Depositary that apply to such transfer or exchange.
"Asset Sale" means: (i) the sale, lease, conveyance or other disposition of
any assets or rights; provided that the sale, conveyance or other disposition of
all or substantially all of the assets of the Company and its Restricted
Subsidiaries taken as a whole will be governed by Sections 4.15 and 5.01 and not
by Section 4.10 hereof; and (ii) the issuance of Equity Interests by any of the
Company's Restricted Subsidiaries or the sale of Equity Interests by the Company
in any of its Subsidiaries. Notwithstanding the preceding, the following items
shall not be deemed to be Asset Sales: (i) any single transaction or series of
related transactions that involves assets having a fair market value of less
than $250,000; (ii) a transfer of assets between or among the Company and its
Wholly Owned Restricted Subsidiaries; (iii) an issuance of Equity Interests by a
Wholly Owned Restricted Subsidiary to the Company or to another Wholly Owned
Restricted Subsidiary; (iv) the sale, lease or exchange of equipment, inventory,
accounts receivable or other assets in the ordinary course of business; (v) the
sale or other disposition of cash or Cash Equivalents; (vi) a Restricted Payment
or Permitted Investment that is permitted by Section 4.07 hereof; and (vii) the
granting of a Permitted Lien.
"Attributable Debt" in respect of a sale and leaseback transaction means,
at the time of determination, the present value of the obligation of the lessee
for net rental payments during the remaining term of the lease included in such
sale and leaseback transaction including any period for which such lease has
been extended or may, at the option of the lessor, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and
Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as that term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
2
exercisable only upon the occurrence of a subsequent condition. The terms
"Beneficially Owns" and "Beneficially Owned" shall have a corresponding meaning.
"Board of Directors" means: (i) with respect to a corporation, the board of
directors of the corporation; (ii) with respect to a partnership, the Board of
Directors of the general partner of the partnership; and (iii) with respect to
any other Person, the board or committee of such Person serving a similar
function.
"Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at that time be required to be capitalized on a balance sheet in accordance with
GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate stock;
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock; (iii) in the case of a partnership or limited liability
company, partnership or membership interests (whether general or limited); and
(iv) any other interest or participation that confers on a Person the right to
receive a share of the profits and losses of, or distributions of assets of, the
issuing Person.
"Cash Collateral Accounts" means, collectively, the Construction
Disbursement Account, the Interest Reserve Account, the Completion Reserve
Account and the Disbursed Funds Account (as defined in the Cash Collateral and
Disbursement Agreement).
"Cash Collateral and Disbursement Agreement" means the Cash Collateral and
Disbursement Agreement among the Company, the Trustee, the Independent
Construction Consultant and the Disbursement Agent in connection with the
Riviera Black Hawk.
"Cash Equivalents" means (i) United States dollars; (ii) securities issued
or directly and fully guaranteed or insured by the United States government or
any agency or instrumentality thereof (provided that the full faith and credit
of the United States is pledged in support thereof) having maturities of not
more than six months from the date of acquisition; (iii) certificates of deposit
and eurodollar time deposits with maturities of six months or less from the date
of acquisition, bankers' acceptances with maturities not exceeding six months
and overnight bank deposits, in each case, with any domestic commercial bank
having capital and surplus in excess of $500.0 million and a Thomson Bank Watch
Rating of "B" or better; (iv) repurchase obligations with a term of not more
than seven days for underlying securities of the types described in clauses (ii)
and (iii) above entered into with any financial institution meeting the
qualifications specified in clause (iii) above; (v) commercial paper having the
highest rating obtainable from Xxxxx'x Investors Service, Inc. or Standard &
Poor's Rating Services and in each case maturing within six months after the
date of acquisition; and (vi) money market funds at least 95% of the assets of
which constitute Cash Equivalents of the kinds described in clauses (i) through
(v) of this definition.
3
"Change of Control" means the occurrence of any of the following: (i) the
direct or indirect sale, transfer, conveyance or other disposition (other than
by way of merger or consolidation), in one or a series of related transactions,
of all or substantially all of the properties or assets of Riviera Holdings and
its Subsidiaries taken as a whole to any "person" (as that term is used in
Section 13(d)(3) of the Exchange Act), other than one or more of the Existing
Significant Holders or any of their Related Parties; (ii) the expiration or
termination of the Management Agreement or the replacement of Riviera Management
as manager under the Management Agreement with any Person other than an
Affiliate of Riviera Management; (iii) the adoption of a plan relating to the
liquidation or dissolution, of the Company or Riviera Holdings or any successor
thereto; (iv) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above), other than one or more of the Existing Significant
Holders and any of their respective Related Parties, becomes the Beneficial
Owner, directly or indirectly, of (a) more than 35% of the outstanding Voting
Stock of the Riviera Holdings, measured by voting power rather than number of
shares and (b) a greater percentage of the outstanding Voting Stock of Riviera
Holdings than is Beneficially Owned by the Existing Significant Holders and of
their respective Related Parties holding the largest such percentage; (v) the
first day on which a majority of the members of the Board of Directors of
Riviera Holdings are not Continuing Directors; (vi) Riviera Holdings
consolidates with, or merges with or into, any Person or sells, assigns,
conveys, transfers, leases or otherwise disposes of all or substantially all of
its assets to any Person, or any Person consolidates with, or merges with or
into, Riviera Holdings, in any such event pursuant to a transaction in which any
of the outstanding Voting Stock of Riviera Holdings is converted into or
exchanged for cash, securities or other property, other than any such
transaction where the Voting Stock of Riviera Holdings outstanding immediately
prior to such transaction is converted into or exchanged for Voting Stock (other
than Disqualified Stock) of the surviving or transferee Person constituting a
majority of the outstanding shares of such Voting Stock of such surviving or
transferee Person (immediately after giving effect to such issuance); or (vii)
the first day on which Riviera Holdings ceases to own at least 51% of the
outstanding Equity Interests of the Company.
"Closing Date" means the closing date for the sale and original issuance of
the Series A Notes.
"Collateral" means all assets, now owned or hereafter acquired, of the
Company or any of its Subsidiaries, that are pledged or assigned, or required to
be pledged or assigned under this Indenture or the Collateral Documents, to the
Trustee, together with the proceeds thereof (including, without limitation, the
proceeds of Asset Sales), in each case excluding FF&E acquired, refinanced or
leased with FF&E Financing, gaming and liquor licenses and certain other
exceptions and assets of future unrestricted subsidiaries of the Company.
"Collateral Documents" means, collectively, the Deed of Trust, the Security
Agreement by the Company in favor of the Trustee, the Assignments of Patent,
Trademark and Copyright by the Company in favor of the Trustee (to the extent
that it is entered into following the Closing Date), the Collateral Assignments
by the Company in favor of the Trustee, the Cash Collateral and Disbursement
Agreement, the Pledge Agreement by the Company in favor of the Trustee (to the
extent that it is entered into following the Closing Date), the Pledge and
Assignment Agreement by the Company in favor of the Trustee, the Manager
Subordination Agreement,
4
Uniform Commercial Code financing statements and fixture filings, and any other
agreements, instruments, documents, pledges or filings executed in connection
therewith or that otherwise evidence, set forth or limit the Lien of the Trustee
or the Disbursement Agent in the Collateral.
"Company" means Riviera Black Hawk, Inc., and any and all successors
thereto.
"Completion Capital Commitment" means the Completion Capital Commitment
dated as of the date of the indenture executed by Riviera Holdings and the
Company.
"Completion Reserve Account" means the account to be maintained by the
Disbursement Agent and pledged to the Trustee pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $5.0 million of
the proceeds of the Offering shall be deposited.
"Consolidated Cash Flow" means, with respect to any specified Person for
any period, the Consolidated Net Income of such Person for such period plus: (i)
an amount equal to any extraordinary loss plus any net loss realized by such
Person or any of its Subsidiaries in connection with an Asset Sale, to the
extent such losses were deducted in computing such Consolidated Net Income; plus
(ii) provision for taxes based on income or profits of such Person and its
Restricted Subsidiaries for such period, to the extent that such provision for
taxes was deducted in computing such Consolidated Net Income; plus (iii)
consolidated interest expense of such Person and its Restricted Subsidiaries for
such period, whether paid or accrued and whether or not capitalized (including,
without limitation, amortization of debt issuance costs and original issue
discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with
Capital Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net of the effect of all
payments made or received pursuant to Hedging Obligations), to the extent that
any such expense was deducted in computing such Consolidated Net Income; plus
(iv) depreciation, amortization (including amortization of goodwill and other
intangibles but excluding amortization of prepaid cash expenses that were paid
in a prior period) and other non-cash expenses (excluding any such non-cash
expense to the extent that it represents an accrual of or reserve for cash
expenses in any future period or amortization of a prepaid cash expense, other
than pre-opening expenses, that was paid in a prior period) of such Person and
its Restricted Subsidiaries for such period to the extent that such
depreciation, amortization and other non-cash expenses were deducted in
computing such Consolidated Net Income; minus (v) non-cash items increasing such
Consolidated Net Income for such period, other than the accrual of revenue in
the ordinary course of business, in each case, on a consolidated basis and
determined in accordance with GAAP. Notwithstanding the preceding, the provision
for taxes based on the income or profits of, and the depreciation and
amortization and other non-cash expenses of, a Restricted Subsidiary of the
Company shall be added to Consolidated Net Income to compute Consolidated Cash
Flow of the Company only to the extent that a corresponding amount would be
permitted at the date of determination to be dividended to the Company by such
Restricted Subsidiary without prior governmental approval (that has not been
obtained), and without direct or indirect restriction pursuant to the terms of
its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to that Subsidiary or
its stockholders.
5
"Consolidated Net Income" means, with respect to any specified Person for
any period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that: (i) the Net Income (but not loss) of any Person that
is not a Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash to the specified Person or a Wholly Owned Restricted
Subsidiary thereof; (ii) the Net Income of any Restricted Subsidiary shall be
excluded to the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at the
date of determination permitted without any prior governmental approval (that
has not been obtained) or, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to that Restricted Subsidiary or its
stockholders; (iii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition shall
be excluded; (iv) the Net Income (but not loss) of any Unrestricted Subsidiary
shall be excluded, whether or not distributed to the specified person or one of
its Subsidiaries; (v) the Net Income of any Person and its Restricted
Subsidiaries shall be calculated without any deduction for preopening expenses
determined in accordance with GAAP; and (vi) the cumulative effect of a change
in accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any specified Person as of
any date, the sum of: (i) the consolidated equity of the common stockholders of
such Person and its consolidated Subsidiaries as of such date; plus (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of preferred stock (other than Disqualified Stock) that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such preferred stock.
"Construction Disbursement Account" means the account to be maintained by
the Disbursement Agent and pledged to the Trustee pursuant to the terms of the
Cash Collateral and Disbursement Agreement, into which approximately $31.9
million of the net proceeds of the Offering shall be deposited.
"Construction Disbursement Budget" means itemized schedules setting forth
on a line item basis all of the costs (including financing costs) estimated to
be incurred in connection with the financing, design, development, construction
and equipping of the Riviera Black Hawk, as such schedules are delivered to the
Disbursement Agent on the Closing Date and as amended from time to time in
accordance with the terms of the Cash Collateral and Disbursement Agreement.
"Contingent Interest" means interest payable on each Interest Payment Date
with respect to any principal amount of outstanding Notes in an amount equal to
the product of (1) 5% of the Company's Consolidated Cash Flow for its two most
recently completed fiscal quarters prior to the Record Date applicable to that
Interest Payment Date and (2) a fraction, the numerator of which is the
principal amount of Notes outstanding on the close of business on that Record
Date and the denominator of which is $45.0 million; provided, that Contingent
Interest
6
will cease to accrue during a Semiannual Period on any principal amount of
outstanding Notes if the aggregate amount of Contingent Interest in respect of
any four consecutive fiscal quarters (excluding any Contingent Interest deferred
from prior periods) exceeds the product of (a) $1.75 million and (b) a fraction,
the numerator of which is such principal amount of outstanding Notes and the
denominator of which is $45.0 million.
"Continuing Directors" means, as of any date of determination, any member
of the Board of Directors of Riviera Holdings who: (i) was a member of such
Board of Directors on the date hereof; or (ii) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 11.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Custodian" means the Trustee, as custodian with respect to the Notes in
global form, or any successor entity thereto.
"Deed of Trust" means the Deed of Trust to the Public Trustee, Security
Agreement, Fixture Filing and Assignment of Rents, Leases and Leasehold
Interests dated as of the date hereof, by the Company to the Public Trustee of
the County of Xxxxxx, Colorado, for the benefit of the Trustee.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of the
Holder thereof and issued in accordance with Section 2.06 hereof, substantially
in the form of Exhibit A hereto except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in whole
or in part in global form, the Person specified in Section 2.03 hereof as the
Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disbursement Agent" means IBJ Whitehall Bank and Trust Company, as
disbursement agent.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
date on which the Notes mature. Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to
7
repurchase such Capital Stock upon the occurrence of a change of control or an
asset sale shall not constitute Disqualified Stock if the terms of such Capital
Stock provide that the Company may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption complies
with Section 4.07 hereof.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Event of Loss" means, with respect to any property or asset (tangible or
intangible, real or personal), any of the following: (i) any loss, destruction
or damage of such property or asset; (ii) any institution of any proceedings for
the condemnation or seizure of such property or asset or for the exercise of any
right of eminent domain; (iii) any actual condemnation, seizure or taking by
exercise of the power of eminent domain or otherwise of such property or asset,
or confiscation of such property or asset or the requisition of the use of such
property or asset; or (iv) any settlement in lieu of clauses (ii) or (iii)
above.
"Excess Cash Flow" means, with respect to the Company for any Operating
Year, the Consolidated Cash Flow of the Company and its Subsidiaries for such
Operating Year, minus (i) cash interest expense (excluding any Contingent
Interest and including the portion of any payments associated with Capital Lease
Obligations) of the Company and its Subsidiaries that is paid during such
Operating Year and, without duplication, Contingent Interest of the Company and
its Subsidiaries that is paid or deferred in accordance with the provisions of
this Indenture during such Operating Year, but only to the extent that such
Contingent Interest was not deferred in any prior Operating Year, minus (ii) up
to $4.0 million in capital expenditures of the Company and its Subsidiaries paid
to maintain or improve the Riviera Black Hawk that are actually paid during such
Operating Year (excluding any capital expenditures made with the proceeds from
the sale of the Notes), minus (iii) principal payments on Indebtedness permitted
to be incurred pursuant to Section 4.09 hereof and minus (iv) amounts paid by
the Company to Riviera Holdings pursuant to the Tax Sharing Agreement as in
effect on the date hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"Exchange Notes" means the Notes issued in the Exchange Offer pursuant to
Section 2.06(f) hereof.
"Existing Significant Holder" means the Morgens Entities named in the
Offering Circular, Sun America Life Insurance Company and Keyport Life Insurance
Company.
"FF&E" means furniture, fixtures or equipment used in the ordinary course
of the business of the Company and its Subsidiaries.
8
"FF&E Financing" means the incurrence of Indebtedness, the proceeds of
which are utilized solely to finance the acquisition of (or entry into a capital
lease by the Company or a Subsidiary with respect to) FF&E.
"Final Plans" with respect to any particular work or improvement means
Plans which (i) have received final approval from all governmental authorities
required to approve such Plans prior to completion of the work or improvements
and (ii) contain sufficient specificity to permit the completion of the work or
improvement.
"Fixed Charge Coverage Ratio" means with respect to any specified Person
for any period, the ratio of the Consolidated Cash Flow of such Person and its
Restricted Subsidiaries for such period to the Fixed Charges of such Person for
such period. In the event that the specified Person or any of its Restricted
Subsidiaries incurs, assumes, Guarantees, repays, repurchases or redeems any
Indebtedness (other than ordinary working capital borrowings) or issues,
repurchases or redeems preferred stock subsequent to the commencement of the
period for which the Fixed Charge Coverage Ratio is being calculated and on or
prior to the date on which the event for which the calculation of the Fixed
Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed Charge
Coverage Ratio shall be calculated giving pro forma effect to such incurrence,
assumption, Guarantee, repayment, repurchase or redemption of Indebtedness, or
such issuance, repurchase or redemption of preferred stock, and the use of the
proceeds therefrom as if the same had occurred at the beginning of the
applicable four-quarter reference period. In addition, for purposes of
calculating the Fixed Charge Coverage Ratio: (i) acquisitions that have been
made by the specified Person or any of its Restricted Subsidiaries, including
through mergers or consolidations and including any related financing
transactions, during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date shall be given pro
forma effect as if they had occurred on the first day of the four-quarter
reference period and Consolidated Cash Flow for such reference period shall be
calculated on a pro forma basis in accordance with Regulation S-X under the
Securities Act, but without giving effect to clause (iii) of the proviso set
forth in the definition of Consolidated Net Income; (ii) the Consolidated Cash
Flow attributable to discontinued operations, as determined in accordance with
GAAP, and operations or businesses disposed of prior to the Calculation Date,
shall be excluded; and (iii) the Fixed Charges attributable to discontinued
operations, as determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, shall be excluded, but only to the
extent that the obligations giving rise to such Fixed Charges shall not be
obligations of the specified Person or any of its Restricted Subsidiaries
following the Calculation Date.
"Fixed Charges" means, with respect to any specified Person for any period,
the sum, without duplication, of (i) the consolidated interest expense
(excluding Contingent Interest, if any, paid or accrued) of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued, excluding
amortization of debt issuance costs and issuance discounts in connection with
the issuance of the Notes, but including, without limitation, amortization of
debt issuance costs and original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, imputed interest with
respect to Attributable Debt, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings, and
net of the effect of all payments made or received pursuant to Hedging
Obligations; plus (ii) the
9
consolidated interest of such Person and its Restricted Subsidiaries that was
capitalized during such period; plus (iii) any interest expense on Indebtedness
of another Person that is Guaranteed by such Person or one of its Restricted
Subsidiaries or secured by a Lien on assets of such Person or one of its
Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon;
plus (iv) the product of (a) all dividends, whether paid or accrued and whether
or not in cash, on any series of preferred stock of such Person or any of its
Restricted Subsidiaries, other than dividends on Equity Interests payable solely
in Equity Interests of the Company (other than Disqualified Stock) or to the
Company or a Restricted Subsidiary of the Company, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current combined federal, state and local statutory tax rate of such Person,
expressed as a decimal, in each case, on a consolidated basis and in accordance
with GAAP.
"Fixed Interest" means the fixed interest payable on the Notes.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Gaming Authority" means any agency, authority, board, bureau, commission,
department, office or instrumentality of any nature whatsoever of the United
States federal government, any foreign government, any state, province or city
or other political subdivision or otherwise, whether now or hereafter in
existence, including the Colorado Limited Gaming Commission and the Colorado
Division of Gaming, and any other applicable gaming regulatory authority with
authority to regulate any gaming operation (or proposed gaming operation) owned,
managed or operated by the Company, Riviera Holdings, Riviera Management or any
of their respective Subsidiaries.
"Gaming Business" means the gaming business and includes all businesses
either licensed or unlicensed by a Gaming Authority necessary for, incident to
or connected with or arising out of the operation of a gaming establishment or
facility (including developing and operating lodging, retail and restaurant
facilities, sports or entertainment facilities, transportation services or other
related activities or enterprises and any additions or improvements thereto) and
any businesses incident and useful to the gaming business, including, without
limitation, food and beverage distribution operations to the extent that they
are operated in connection with a gaming business.
"Gaming Facility" means any tangible building or other structure used or
expected to be used to enclose space in which a gaming operation is conducted
and (i) is wholly or partially owned, directly or indirectly, by the Company or
any Restricted Subsidiary of the Company or (ii) any portion or aspect of which
is managed or used, or expected to be managed or used, by the Company or a
Restricted Subsidiary of the Company.
"Gaming Law" means the gaming laws of any jurisdiction or jurisdictions to
which the Company or any of its Subsidiaries is subject on the date hereof.
10
"Gaming License" means any license, permit, franchise or other
authorization from any Gaming Authority necessary on the date hereof or at any
time thereafter to own, lease, operate or otherwise conduct the business of the
Company or any of its Restricted Subsidiaries.
"Global Notes" means, individually and collectively, each of the Restricted
Global Notes and the Unrestricted Global Notes, substantially in the form of
Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(iv),
2.06(d)(ii) or 2.06(f) hereof.
"Global Note Legend" means the legend set forth in Section 2.06(g)(ii)
hereof, which is required to be placed on all Global Notes issued under this
Indenture.
"Government Securities" means securities that are: (i) direct obligations
of the United States of America for the timely payment of which its full faith
and credit is pledged; or (ii) obligations of a Person controlled or supervised
by and acting as an agency or instrumentality of the United States of America
the timely payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act of 1933, as amended), as custodian with respect to any such
Government Security or a specific payment of principal of or interest on any
such Government Security held by such custodian for the account of the holder of
such depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the Government Security or the specific payment of principal of or
interest on the Government Security evidenced by such depository receipt.
"Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.
"Guarantor" means any Subsidiary that executes a Note Guarantee in
accordance with the provisions of the Indenture, and its respective successors
and assigns.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under: (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements; and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means the global Note substantially in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of and registered in the name of the Depositary
or its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold to Institutional Accredited Investors.
11
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent, in respect of: (i)
borrowed money, including accrued and unpaid Contingent Interest; (ii) evidenced
by bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof); (iii) banker's acceptances; (iv)
representing Capital Lease Obligations; (v) the balance deferred and unpaid of
the purchase price of any property, except any such balance that constitutes an
accrued expense or trade payable; or (vi) representing any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any indebtedness of any other Person. The amount of
any Indebtedness outstanding as of any date shall be: (i) the accreted value
thereof, in the case of any Indebtedness issued with original issue discount;
and (ii) the principal amount thereof, together with any interest thereon that
is more than 30 days past due, in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Independent Construction Consultant" means the independent construction
consultant retained in connection with the construction of the Riviera Black
Hawk, or any successor independent construction consultant appointed by the
Trustee pursuant to the terms of the Cash Collateral and Disbursement Agreement.
"Indirect Participant" means a Person who holds a beneficial interest in a
Global Note through a Participant.
"Initial Notes" means the $45,000,000 aggregate principal amount of Notes
issued under this Indenture on the date hereof.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Intercompany Notes" means the intercompany notes issued by Subsidiaries of
the Company in favor of the Company to evidence advances by the Company in the
form attached as Exhibit E to this Indenture.
"Interest" means Fixed Interest and Contingent Interest, if any.
"Interest Payment Date" means each May 1 and November 1 or if any such day
is not a Business Day, the next succeeding Business Day.
"Interest Reserve Account" means the account to be maintained by the
Disbursement Agent and pledged to the Trustee pursuant to the terms of the Cash
Collateral and Disbursement Agreement, into which approximately $5.1 million of
the proceeds of the Offering shall be deposited.
12
"Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If the Company
or any Restricted Subsidiary of the Company sells or otherwise disposes of any
Equity Interests of any direct or indirect Restricted Subsidiary of the Company
such that, after giving effect to any such sale or disposition, such Person is
no longer a Restricted Subsidiary of the Company, the Company shall be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Restricted Subsidiary not sold
or disposed of in an amount determined as provided in the final paragraph of
Section 4.07 hereof. The acquisition by the Company or any Restricted Subsidiary
of the Company of a Person that holds an Investment in a third Person shall be
deemed to be an Investment by the Company or such Restricted Subsidiary in such
third Person in an amount equal to the fair market value of the Investment held
by the acquired Person in such third Person in an amount determined as provided
in the final paragraph of Section 4.07 hereof.
"Keep-Well Agreement" means the Keep-Well Agreement dated as of the date of
this Indenture executed by Riviera Holdings and the Company.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared by
the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"License Agreement" means the Trademark License Agreement as in effect on
the date of this Indenture between Riviera Operating Corporation, a Nevada
corporation, and the Company.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Liquidated Damages" means all liquidated damages then owing pursuant to
Section 5 of the Registration Rights Agreement.
13
"Liquor License" means any license, permit, franchise or other
authorization from any Liquor Licensing Authority necessary on the date of this
Indenture or at any time thereafter to own, lease, operate or otherwise conduct
the retail, restaurant or other entertainment facilities of the Company or any
of its Restricted Subsidiaries in the manner described in the Offering Circular.
"Liquor Licensing Authority" means any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
the United States federal government, any foreign government, any state,
province or city or other political subdivision or otherwise, whether now or
hereafter in existence, including the Colorado Liquor Enforcement Division and
the City of Black Hawk Liquor Licensing Authority and any other applicable
liquor licensing regulatory authority with authority to regulate any liquor
licensed operation (or proposed liquor licensed operation) owned, managed or
operated by the Company, Riviera Holdings, Riviera Management or any of their
respective Subsidiaries.
"Management Agreement" means the Management Agreement as in effect on the
date of this Indenture between the Company and Riviera Management relating to
the management of the Riviera Black Hawk.
"Management Fees" means any amounts payable to Riviera Management pursuant
to the Management Agreement.
"Manager Subordination Agreement" means the Manager Subordination Agreement
dated as of the date of this Indenture among the Company, Riviera Management and
the Trustee.
"Minimum Facilities" means, with respect to the Riviera Black Hawk, a
casino which has in operation at least 900 slot machines and 12 table games,
related amenities (including a restaurant, a bar and an entertainment area) and
has parking for at least 442 vehicles.
"Net Income" means, with respect to any specified Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however: (i) any
gain (but not loss), together with any related provision for taxes on such gain
(but not loss), realized in connection with: (a) any Asset Sale; or (b) the
disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries; and (ii) any extraordinary gain (but not loss),
together with any related provision for taxes on such extraordinary gain (but
not loss).
"Net Loss Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Event of Loss,
including, without limitation, insurance proceeds from condemnation awards or
damages awarded by any judgment, net of the direct costs in recovery of such Net
Loss Proceeds (including, without limitation, legal, accounting, appraisal and
insurance adjuster fees and any relocation expenses incurred as a result
thereof), amounts required to be applied to the repayment of Indebtedness
secured by a Lien on the asset or assets that were the subject of such Event of
Loss, and any taxes paid or payable as a result thereof.
14
"Net Proceeds" means the aggregate cash proceeds received by the Company or
any of its Subsidiaries in respect of any Asset Sale (including, without
limitation, any cash received upon the sale or other disposition of any non-cash
consideration received in any Asset Sale), net of the direct costs relating to
such Asset Sale, including, without limitation, legal, accounting and investment
banking fees, sales commissions, relocation expenses incurred as a result
thereof and taxes paid or payable as a result thereof, in each case, after
taking into account any available tax credits or deductions and any tax sharing
arrangements, and amounts required to be applied to the repayment of
Indebtedness secured by a Lien on the asset or assets that were the subject of
such Asset Sale and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the Company
nor any of its Restricted Subsidiaries (a) provides credit support of any kind
(including any undertaking, agreement or instrument that would constitute
Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise,
or (c) constitutes the lender; (ii) no default with respect to which (including
any rights that the holders thereof may have to take enforcement action against
an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any
holder of any other Indebtedness (other than the Notes) of the Company or any of
its Restricted Subsidiaries to declare a default on such other Indebtedness or
cause the payment thereof to be accelerated or payable prior to its stated
maturity; and (iii) as to which the lenders have been notified in writing that
they shall not have any recourse to the stock or assets of the Company or any of
its Restricted Subsidiaries.
"Note Guarantee" means the Guarantee by each Guarantor of the Company's
payment obligations under this Indenture and on the Notes executed pursuant to
the provisions of this Indenture.
"Notes" has the meaning assigned to it in the preamble to this Indenture.
The Initial Notes and the Additional Notes shall be treated as a single class
for all purposes under this Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of the Series A Notes by the Company.
"Offering Circular" means the offering circular of the Company dated May
27, 1999 relating to the Series A Notes.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary or any Vice-President of such Person.
15
"Officers' Certificate" means a certificate signed on behalf of the Company
by two Officers of the Company, one of whom must be the principal executive
officer, the principal financial officer, the treasurer or the principal
accounting officer of the Company, that meets the requirements of Section 11.05
hereof.
"Operating" means, with respect to the Riviera Black Hawk, the first time
that: (i) all Gaming Licenses have been granted and have not been revoked or
suspended; (ii) all Liens (other than Liens created by the Collateral Documents
or Permitted Liens) related to the development, construction and equipping of,
and beginning operations at, the Riviera Black Hawk have been discharged or, if
payment is not yet due or if such payment is contested in good faith by the
Company, sufficient funds remain in the Construction Disbursement Account to
discharge such Liens and the Company has taken any action (including the
institution of legal proceedings) necessary to prevent the sale of any or all of
the Riviera Black Hawk or the real property on which the Riviera Black Hawk
shall be constructed; (iii) the Independent Construction Consultant shall
deliver a certificate to the Trustee certifying that the Riviera Black Hawk is
substantially complete in all material respects in accordance with the Final
Plans with respect to the Minimum Facilities; (iv) the Riviera Black Hawk is in
a condition (including installation of furnishings, fixtures and equipment) to
receive customers in the ordinary course of business; (v) the Minimum Facilities
are open to the general public and operating in accordance with applicable law;
and (vi) a permanent or temporary certificate of occupancy has been issued for
the Riviera Black Hawk by the appropriate governmental authorities.
"Operating Deadline" means May 31, 2000.
"Operating Year" means the four consecutive fiscal quarter period of the
Company beginning immediately after the date that the Riviera Black Hawk first
becomes Operating, and each succeeding four consecutive fiscal quarter period
thereafter that begins immediately after each anniversary of the date the
Riviera Black Hawk becomes Operating.
"Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee, that meets the requirements of Section 11.05 hereof.
The counsel may be an employee of or counsel to the Company, any Subsidiary of
the Company or the Trustee.
"Participant" means, with respect to the Depositary, a Person who has an
account with the Depositary.
"Permitted Business" means (i) the gaming business; (ii) all businesses
whether or not licensed by a Gaming Authority which are necessary for, incident
to, useful to or arising out of the operation of a Gaming Facility; (iii) any
development or operation of lodging, including hotels and timeshares, retail and
restaurant facilities, sports or entertainment facilities, food and beverage
distribution operations, transportation services or other activities related to
the foregoing and any additions or improvements thereto; and (iv) any business
that is a reasonable extension, development or expansion of any of the
foregoing.
"Permitted Investments" means (i) any Investment in the Company or in a
Wholly Owned Restricted Subsidiary of the Company that is engaged in a Permitted
Business and that is
16
evidenced by Capital Stock or Intercompany Notes that are pledged to the Trustee
as Collateral; (ii) any Investment in Cash Equivalents; (iii) any Investment by
the Company or any Restricted Subsidiary of the Company in a Person that is
engaged in a Permitted Business and that is evidenced by Capital Stock or
Intercompany Notes that are pledged to the Trustee as Collateral, if as a result
of such Investment: (a) such Person becomes a Wholly Owned Restricted Subsidiary
of the Company; or (b) such Person is merged, consolidated or amalgamated with
or into, or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Wholly Owned Restricted Subsidiary of the
Company; (iv) Investments in any Person the primary business of which is
related, ancillary or complementary to the businesses of the Company and its
Subsidiaries; provided that the aggregate amount of such Investments does not
exceed $5.0 million; (v) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10 hereof; (vi) any acquisition of assets solely in
exchange for the issuance of Equity Interests (other than Disqualified Stock) of
the Company; (vii) Hedging Obligations; and (viii) after the Riviera Black Hawk
is Operating, any purchases from time to time by the Company of Notes.
"Permitted Liens" means (i) Liens on property of a Person existing at the
time such Person is merged into or consolidated with the Company or any
Restricted Subsidiary of the Company; provided that such Liens were in existence
prior to the contemplation of such merger or consolidation and do not extend to
any assets other than those of the Person merged into or consolidated with the
Company or any Restricted Subsidiary; (ii) Liens on property existing at the
time of acquisition thereof by the Company or any Restricted Subsidiary of the
Company (other than materials, supplies or FF&E acquired in connection with
developing, constructing or equipping of, or commencing operations at, the
Riviera Black Hawk), provided that such Liens were in existence prior to the
contemplation of such acquisition; (iii) Liens existing on the date of this
Indenture and disclosed to the Trustee in writing or disclosed in the title
commitment for the Deed of Trust; (iv) statutory Liens of landlords and
carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or other
like Liens arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by an appropriate
process of law; provided that (a) a reserve or other appropriate provision as
shall be required by GAAP shall have been made therefor and (b) with respect to
such Liens arising in connection with the Riviera Black Hawk, the Company has
obtained any title insurance endorsements required by, and has otherwise
complied with the provisions relating thereto contained in, the Cash Collateral
and Disbursement Agreement; (v) Liens for taxes, assessments or governmental
charges or claims that are not yet delinquent or that are being contested in
good faith by appropriate proceedings promptly instituted and diligently
concluded; provided that any reserve or other appropriate provision as shall be
required in conformity with GAAP shall have been made therefor; (vi) Liens
securing obligations in respect of this Indenture or the Notes; (vi) Liens on
FF&E to secure Indebtedness permitted by clause (vi) of the second paragraph of
Section 4.09 hereof; (viii) pledges or deposits in the ordinary course of
business to secure lease obligations or nondelinquent obligations under workers'
compensation, unemployment insurance or similar legislation; and (ix) easements,
rights-of-way, restrictions, minor defects or irregularities in title and other
similar charges or encumbrances not interfering in any material respect with the
business or assets of the Company or any Subsidiary incurred in the ordinary
course of business.
17
"Permitted Refinancing Indebtedness" means any Indebtedness of the Company
or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided that: (i) the principal amount
(or accreted value, if applicable) of such Permitted Refinancing Indebtedness
does not exceed the principal amount (or accreted value, if applicable) of the
Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded
(plus all accrued interest thereon and the amount of all expenses and premiums
incurred in connection therewith); provided, if such Indebtedness is secured by
a Lien described in clause (vii) of the definition of "Permitted Liens," then
the principal amount (or accreted value, if applicable) of such Permitted
Refinancing Indebtedness shall not exceed the then current fair market value of
the asset so encumbered; (ii) such Permitted Refinancing Indebtedness has a
final maturity date later than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average Life to
Maturity of, the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; (iii) if the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded is subordinated in right of payment to
the Notes, such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and is subordinated in right of payment
to, the Notes on terms at least as favorable to the Holders as those contained
in the documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; and (iv) such Indebtedness is incurred
either by the Company or by the Restricted Subsidiary who is the obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other entity.
"Plans" means the plans, specifications, working drawings, change orders,
correspondence and related items that collectively (i) provide for and detail
the manner of development, construction and equipping of the Riviera Black Hawk;
(ii) call for construction which shall permit the Riviera Black Hawk to be
Operating on or prior to the Operating Deadline; (iii) call for construction
which shall cause the Riviera Black Hawk to be Operating for a total cost
consistent with its Construction Disbursement Budget (as defined in the Cash
Collateral and Disbursement Agreement) and the line items set forth therein;
(iv) to the extent such Plans are amended, in the reasonable, professional
judgment of the Independent Construction Consultant, continue to represent a
logical evolution consistent with previous Plans; and (v) together with any
amendments, are consistent with the description of the Riviera Black Hawk
contained in the Offering Circular, and are consistent with all governmental
approvals and requirements, including, without limitation, the Black Hawk
Building Department, Historical Architecture Review Commission and Gaming
Authorities.
"Private Placement Legend" means the legend set forth in Section 2.06(g)(i)
hereof to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
18
"Qualified Public Offering" means (i) an underwritten initial public
offering of the Company's common stock that is registered under the Securities
Act and results in net proceeds to the Company of at least $25.0 million; or
(ii) a privately placed offering of Riviera Holdings' common stock that is
subject to an obligation of Riviera Holdings to register such common stock under
the Securities Act within one year of the consummation of such offering or an
underwritten public offering of Riviera Holdings' common stock, in either case
which results in net proceeds of at least $25.0 million to Riviera Holdings, but
only to the extent that the net proceeds of the offering are contributed as
equity by Riviera Holdings to the Company.
"Record Date" means the April 15 or October 15 immediately preceding an
Interest Payment Date, as applicable.
"Registration Rights Agreement" means the Registration Rights Agreement,
dated as of the Closing Date, among the Company and the other parties named on
the signature pages thereof, as such agreement may be amended, modified or
supplemented from time to time and, with respect to any Additional Notes, one or
more registration rights agreements between the Company and the other parties
thereto, as such agreement(s) may be amended, modified or supplemented from time
to time, relating to rights given by the Company to the purchasers of Additional
Notes to register such Additional Notes under the Securities Act.
"Related Party" means, with respect to any Existing Significant Holder: (i)
any Affiliate, spouse or immediate family member (in the case of an individual)
of such Existing Significant Holder; (ii) any trust, corporation, partnership or
other entity, the beneficiaries, stockholders, partners, owners or Persons
beneficially holding a majority interest of which consist of such Existing
Significant Holder and such other Persons referred to in the immediately
preceding clause (i); or (iii) any trustee, executor or receiver appointed to
manage or administer the assets of an Existing Significant Holder who is an
individual following the death of such individual.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the Private
Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private Placement
Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Riviera Advance" means the amount set forth in the section entitled "Use
of Proceeds" in the Offering Circular to be repaid to Riviera Holdings with
proceeds of the Offering.
19
"Riviera Black Hawk" means the project to develop, construct, equip and
operate the Riviera Black Hawk and related amenities as described in the
Offering Circular.
"Riviera Holdings" means Riviera Holdings Corporation, a Nevada
corporation.
"Riviera Holdings Indenture" means the Indenture dated as of August 13,
1997, among Riviera Holdings, the guarantors named therein and Norwest Bank
Minnesota, a National Association, as trustee, as in effect on the date of this
Indenture.
"Riviera Management" means Riviera Gaming Management of Colorado, Inc., a
Colorado corporation.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Semiannual Period" means each period that begins on April 1 and ends on
the next succeeding September 30 or each period that begins on October 1 and
ends on the next succeeding March 31.
"Shelf Registration Statement" means the Shelf Registration Statement as
defined in the Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would be a "significant
subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the date
hereof.
"Special Assessment Bonds" means the Special Assessment Bonds dated July
15, 1998, issued by the Black Hawk Improvement District of Xxxxxx County,
Colorado, Special Improvement District No. 1997-1.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any specified Person: (i) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and (ii) any partnership (a) the sole general partner or
the managing general
20
partner of which is such Person or a Subsidiary of such Person or (b) the only
general partners of which are such Person or one or more Subsidiaries of such
Person (or any combination thereof).
"Subsidiary Guarantee" means the Guarantee by a Subsidiary of the Company's
payment obligations under this Indenture and on the Notes, executed pursuant to
the provisions of this Indenture.
"Tax Sharing Agreement" means the Tax Sharing Agreement dated the date of
this Indenture, between the Company and Riviera Holdings.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ssss77aaa-77bbbb)
as in effect on the date on which this Indenture is qualified under the TIA.
"Trustee" means the party named as such above until a successor replaces it
in accordance with the applicable provisions of this Indenture and thereafter
means the successor serving hereunder.
"Unrestricted Global Note" means a permanent global Note substantially in
the form of Exhibit A attached hereto that bears the Global Note Legend and that
has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Definitive Note" means one or more Definitive Notes that do
not bear and are not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
resolution, but only to the extent that such Subsidiary (i) has no Indebtedness
other than Non-Recourse Debt; (ii) is not party to any agreement, contract,
arrangement or understanding with the Company or any Restricted Subsidiary of
the Company unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to the Company or such Restricted Subsidiary
than those that might be obtained at the time from Persons who are not
Affiliates of the Company; (iii) is a Person with respect to which neither the
Company nor any of its Restricted Subsidiaries has any direct or indirect
obligation (a) to subscribe for additional Equity Interests or (b) to maintain
or preserve such Person's financial condition or to cause such Person to achieve
any specified levels of operating results; (iv) has not guaranteed or otherwise
directly or indirectly provided credit support for any Indebtedness of the
Company or any of its Restricted Subsidiaries; and (v) has at least one director
on its board of directors that is not a director or executive officer of the
Company or any of its Restricted Subsidiaries and has at least one executive
officer that is not a director or executive officer of the Company or any of its
Restricted Subsidiaries. Any designation of a Subsidiary of the Company as an
Unrestricted Subsidiary shall be evidenced to the Trustee by filing with the
Trustee a certified copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by Section 4.07 hereof.
If, at any time, any Unrestricted Subsidiary would fail to meet the preceding
requirements as an Unrestricted
21
Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for
purposes of this Indenture and any Indebtedness of such Subsidiary shall be
deemed to be incurred by a Restricted Subsidiary of the Company as of such date
and, if such Indebtedness is not permitted to be incurred as of such date under
Section 4.09 hereof, the Company shall be in default of such covenant. The Board
of Directors of the Company may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that such designation shall
be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the
Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such
designation shall only be permitted if (i) such Indebtedness is permitted under
Section 4.09 hereof, calculated on a pro forma basis as if such designation had
occurred at the beginning of the four-quarter reference period and (ii) no
Default or Event of Default would be in existence following such designation.
"Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing: (i) the sum of the
products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that shall elapse
between such date and the making of such payment; by (ii) the then outstanding
principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any specified Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person.
Section 1.02. Other Definitions.
Defined
in
Term Section
---- -------
"Affiliate Transaction".......................................... 4.11
"Asset Sale Offer"............................................... 4.10
"Authentication Order............................................ 2.02
"Bankruptcy Law"................................................. 4.01
"Change of Control Offer"........................................ 4.15
"Change of Control Payment"...................................... 4.15
"Change of Control Payment Date"................................. 4.15
"Collateral Agent"............................................... 10.10
"Covenant Defeasance"............................................ 8.03
"DTC"............................................................ 2.03
"Event of Default"............................................... 6.01
"Event of Loss Offer"............................................ 4.28
"Excess Cash Flow Offer"......................................... 4.29
"Excess Cash Flow Offer Amount".................................. 4.29
22
Defined
in
Term Section
---- -------
"Excess Cash Flow Purchase Price................................. 4.29
"Excess Cash Purchase Offer"..................................... 4.29
"Excess Loss Proceeds"........................................... 4.28
"Excess Proceeds"................................................ 4.10
"Excess Proceeds Offer".......................................... 3.10
"Gaming and Liquor Laws"......................................... 11.14
"incur".......................................................... 4.09
"Legal Defeasance"............................................... 8.02
"Offer Amount"................................................... 3.10
"Offer Period"................................................... 3.10
"Paying Agent"................................................... 2.03
"Permitted Debt"................................................. 4.09
"Purchase Date".................................................. 3.10
"Registrar"...................................................... 2.03
"Restricted Payments"............................................ 4.07
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor upon the
Notes.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to it
in accordance with GAAP;
23
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the plural include the
singular;
(e) provisions apply to successive events and transactions; and
(f) references to sections of or rules under the Securities Act shall be
deemed to include substitute, replacement of successor sections or rules adopted
by the SEC from time to time.
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and are
hereby expressly made, a part of this Indenture and the Company and the Trustee,
by their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby. However, to the extent any provision of
any Note conflicts with the express provisions of this Indenture, the provisions
of this Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form shall be substantially in the
form of Exhibit A attached hereto (including the Global Note Legend thereon and
the "Schedule of Exchanges of Interests in the Global Note" attached thereto).
Notes issued in definitive form shall be substantially in the form of Exhibit A
attached hereto (but without the Global Note Legend thereon and without the
"Schedule of Exchanges of Interests in the Global Note" attached thereto). Each
Global Note shall represent such of the outstanding Notes as shall be specified
therein and each shall provide that it shall represent the aggregate principal
amount of outstanding Notes from time to time endorsed thereon and that the
aggregate principal amount of outstanding Notes represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding Notes
represented thereby shall be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
Section 2.02. Execution and Authentication
An Officer shall sign the Notes for the Company by manual or facsimile
signature. If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid. A Note shall not be valid until authenticated
24
by the manual signature of the Trustee. The signature shall be conclusive
evidence that the Note has been authenticated under this Indenture. The Trustee
shall, upon a written order of the Company signed by an Officer (an
"Authentication Order"), authenticate Notes for original issue up to the
aggregate principal amount stated in paragraph 4 of the Notes. The aggregate
principal amount of Notes outstanding at any time may not exceed such amount
except as provided in Section 2.07 hereof. The Trustee may appoint an
authenticating agent acceptable to the Company to authenticate Notes. An
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with Holders or an Affiliate of the Company.
Section 2.03. Registrar and Paying Agent
The Company shall maintain an office or agency where Notes may be presented
for registration of transfer or for exchange ("Registrar") and an office or
agency where Notes may be presented for payment ("Paying Agent"). The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Company may appoint one or more co-registrars and one or more additional paying
agents. The term "Registrar" includes any co-registrar and the term "Paying
Agent" includes any additional paying agent. The Company may change any Paying
Agent or Registrar without notice to any Holder. The Company shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar. The Company initially
appoints The Depository Trust Company ("DTC") to act as Depositary with respect
to the Global Notes. The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes.
Section 2.04. Paying Agent to Hold Money in Trust
The Company shall require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent shall hold in trust for the benefit of Holders
or the Trustee all money held by the Paying Agent for the payment of principal,
premium or Liquidated Damages, if any, or Interest on the Notes, and shall
notify the Trustee of any default by the Company in making any such payment.
While any such default continues, the Trustee may require a Paying Agent to pay
all money held by it to the Trustee. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee. Upon payment over to
the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall
have no further liability for the money. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy
or reorganization proceedings relating to the Company, the Trustee shall serve
as Paying Agent for the Notes.
Section 2.05. Holder Lists
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply
25
with TIA ss 312(a). If the Trustee is not the Registrar, the Company shall
furnish to the Trustee at least seven Business Days before each Interest Payment
Date and at such other times as the Trustee may request in writing, a list in
such form and as of such date as the Trustee may reasonably require of the names
and addresses of the Holders of Notes and the Company shall otherwise comply
with TIA ss 312(a).
Section 2.06. Transfer and Exchange
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if (i) the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the
Company within 120 days after the date of such notice from the Depositary or
(ii) the Company in its sole discretion determines that the Global Notes (in
whole but not in part) should be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee. Upon the occurrence of either of
the preceding events in (i) or (ii) above, Definitive Notes shall be issued in
such names as the Depositary shall instruct the Trustee. Global Notes also may
be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes. The
transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes shall be subject to restrictions on transfer comparable to those
set forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also shall require compliance with
either subparagraph (i) or (ii) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend. Beneficial
interests in any Unrestricted Global Note may be transferred to Persons who
take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note. No written orders or instructions shall be
required to be delivered to the Registrar to effect the transfers described
in this Section 2.06(b)(i).
26
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(i) above, the transferor
of such beneficial interest must deliver to the Registrar either (A) (1) a
written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in
another Global Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the Participant
account to be credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to cause
to be issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2) instructions given by the
Depositary to the Registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to effect the transfer
or exchange referred to in (1) above. Upon consummation of an Exchange
Offer by the Company in accordance with Section 2.06(f) hereof, the
requirements of this Section 2.06(b)(ii) shall be deemed to have been
satisfied upon receipt by the Registrar of the instructions contained in
the Letter of Transmittal delivered by the Holder of such beneficial
interests in the Restricted Global Notes (which instructions may be
delivered by electronic transmission in accordance with the Applicable
Procedures). Upon satisfaction of all of the requirements for transfer or
exchange of beneficial interests in Global Notes contained in this
Indenture and the Notes or otherwise applicable under the Securities Act,
the Trustee shall adjust the principal amount of the relevant Global
Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof; and
(B) if the transferee will take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications and certificates of Opinion of Counsel required by item
(2) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof
27
for a beneficial interest in an Unrestricted Global Note or transferred to
a Person who takes delivery thereof in the form of a beneficial interest in
an Unrestricted Global Note if the exchange or transfer complies with the
requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of the beneficial interest to be transferred, in the
case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal (or pursuant to
instructions delivered by electronic transmission in accordance with
the Applicable Procedures) that it is not (1) a broker-dealer, (2) a
Person participating in the distribution of the Exchange Notes or (3)
a Person who is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to the
Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D) above
at a time when an Unrestricted Global Note has not yet been issued, the Company
shall issue and, upon receipt of an Authentication Order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the aggregate principal
amount of beneficial interests transferred pursuant to subparagraph (B) or (D)
above. Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
28
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder in the form
of Exhibit C hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item (1) thereof;
(C) if such beneficial interest is being transferred pursuant to
an exemption from the registration requirements of the Securities Act
in accordance with Rule 144 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in item (3)(a) thereof;
(D) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) and (C) above, a certificate to the effect
set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(E) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
thereof; or
(F) if such beneficial interest is being transferred pursuant to
an effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a
29
beneficial interest in a Restricted Global Note pursuant to this Section
2.06(c)(i) shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in
the applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in Rule
144) of the Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to the
Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a Definitive Note that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for
30
a Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Definitive Note, then, upon
satisfaction of the conditions set forth in Section 2.06(b)(ii) hereof, the
Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall be registered in such
name or names and in such authorized denomination or denominations as the
holder of such beneficial interest shall instruct the Registrar through
instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the Persons
in whose names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iii)
shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
(i) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note or
to transfer such Restricted Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in a Restricted Global Note,
then, upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global
Note, a certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to a
QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(D) if such Restricted Definitive Note is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) and (C) above, a certificate to the effect
set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(E) if such Restricted Definitive Note is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
31
(F) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause
to be increased the aggregate principal amount of, in the case of clause
(A) above, the appropriate Restricted Global Note, in the case of clause
(B) above, the 144A Global Note, and in all other cases, the IAI Global
Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Restricted Definitive Note to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global Note
only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in the
case of a transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant
to the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes
to exchange such Notes for a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes
to transfer such Notes to a Person who shall take delivery
thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in the
form of Exhibit B hereto, including the certifications in item
(4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
32
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note at any
time. Upon receipt of a request for such an exchange or transfer, the
Trustee shall cancel the applicable Unrestricted Definitive Note and
increase or cause to be increased the aggregate principal amount of one of
the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D)
or (iii) above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an Authentication
Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of Definitive Notes so
transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon
request by a Holder of Definitive Notes and such Holder's compliance with the
provisions of this Section 2.06(e), the Registrar shall register the transfer or
exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder shall present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the name
of Persons who take delivery thereof in the form of a Restricted Definitive
Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under the
Securities Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item (1)
thereof; and
(B) if the transfer will be made pursuant to any other exemption
from the registration requirements of the Securities Act, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive
33
Note or transferred to a Person or Persons who take delivery thereof in the form
of an Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in the
case of a transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Broker-Dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted Definitive
Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive Note, a
certificate from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or transfer
is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such Notes
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer,
the Registrar shall register the Unrestricted Definitive Notes pursuant to
the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the Exchange
Notes and (z) they are not affiliates
34
(as defined in Rule 144) of the Company, and accepted for exchange in the
Exchange Offer and (ii) Definitive Notes in an aggregate principal amount equal
to the principal amount of the Restricted Definitive Notes accepted for exchange
in the Exchange Offer. Concurrently with the issuance of such Notes, the Trustee
shall cause the aggregate principal amount of the applicable Restricted Global
Notes to be reduced accordingly, and the Company shall execute and the Trustee
shall authenticate and deliver to the Persons designated by the Holders of
Definitive Notes so accepted Definitive Notes in the appropriate principal
amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each Global
Note and each Definitive Note (and all Notes issued in exchange
therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (the "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER: (1)
REPRESENTS THAT (i) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (as defined in Rule
144A under the Act) (a "QIB"), (ii) IT HAS ACQUIRED THIS NOTE IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE ACT OR (iii) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (as defined in Rule 501(A)(1), (2), (3) OR
(7) of Regulation D under the Act (an "IAI"), (2) AGREES THAT IT WILL NOT RESELL
OR OTHERWISE TRANSFER THIS NOTE EXCEPT (i) TO THE COMPANY OR ANY OF ITS
SUBSIDIARIES, (ii) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QIB
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (iii) IN AN OFFSHORE TRANSACTION MEETING
THE REQUIREMENTS OF RULE 903 OR 904 OF THE ACT, (iv) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144 UNDER THE ACT, (v) TO AN IAI THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS NOTE (the form
of which can be obtained from the Trustee) AND, IF SUCH TRANSFER IS IN RESPECT
OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
ACT, (vi) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY) OR (vii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY
35
OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND
"UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S
UNDER THE ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO
REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv), (c)(ii),
(c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this Section
2.06 (and all Notes issued in exchange therefor or substitution
thereof) shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend
in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY."
(h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who shall take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who shall take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
36
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Global Notes and
Definitive Notes upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer pursuant
to Sections 2.10, 3.06, 3.10, 4.10, 4.15, 4.28, 4.29 and 9.05 hereof).
(iii) The Registrar shall not be required to register the transfer of
or exchange any Note selected for redemption in whole or in part, except
the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global Notes
or Definitive Notes surrendered upon such registration of transfer or
exchange.
(v) The Company shall not be required (A) to issue, to register the
transfer of or to exchange any Notes during a period beginning at the
opening of business 15 days before the day of any selection of Notes for
redemption under Section 3.02 hereof and ending at the close of business on
the day of selection, (B) to register the transfer of or to exchange any
Note so selected for redemption in whole or in part, except the unredeemed
portion of any Note being redeemed in part or (C) to register the transfer
of or to exchange a Note between a Record Date and the next succeeding
Interest Payment Date.
(vi) Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of and Interest on
such Notes and for all other purposes, and none of the Trustee, any Agent
or the Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive Notes
in accordance with the provisions of Section 2.02 hereof.
(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06 to
effect a registration of transfer or exchange may be submitted by
facsimile.
37
Section 2.07. Replacement Notes
If any mutilated Note is surrendered to the Trustee or the Company and the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and shall
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.08. Outstanding Notes
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this Section as
not outstanding. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Note; however, Notes held by the Company or a Subsidiary of the Company
shall not be deemed to be outstanding for purposes of Section 3.07(b) hereof. If
a Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Note is
held by a bona fide purchaser. If the principal amount of any Note is considered
paid under Section 4.01 hereof, it ceases to be outstanding and Interest on it
ceases to accrue. If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
Interest.
Section 2.09. Treasury Notes
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.
Section 2.10. Temporary Notes
Until certificates representing Notes are ready for delivery, the Company
may prepare and the Trustee, upon receipt of an Authentication Order, shall
authenticate temporary Notes. Temporary Notes shall be substantially in the form
38
of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as shall be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate definitive Notes in exchange for temporary Notes. Holders of
temporary Notes shall be entitled to all of the benefits of this Indenture.
Section 2.11. Cancellation
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes shall be delivered
to the Company. The Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation.
Section 2.12. Defaulted Interest
If the Company defaults in a payment of Interest on the Notes, it shall pay
the defaulted Interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted Interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall notify the Trustee in writing of
the amount of defaulted Interest proposed to be paid on each Note and the date
of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
Interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
Interest to be paid.
Section 2.13. CUSIP Number
The Company in issuing the Notes may use a "CUSIP" number and if so the
Trustee shall use the CUSIP number in notices of redemption or exchange as a
convenience to Holders, provided that any such notice may state that no
representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Notes and that reliance may be placed only on
the other identification numbers printed on the Notes. The Company shall
promptly notify the Trustee of any change in the CUSIP number.
Section 2.14. Exchange Registration
In the event that the Company delivers to the Trustee a copy of an order of
effectiveness or a certification of the Company with respect to such
effectiveness with respect to the Exchange Offer, the Trustee shall, at the
Company's expense, notify the Holders of the receipt of such order of
effectiveness or certification and upon the request of any Holder shall exchange
such Holder's Notes upon the terms set forth in the Exchange Offer.
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ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, it shall furnish to the Trustee, at least 30
days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the clause of this Indenture pursuant to which the
redemption shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.
Section 3.02. Selection of Notes to Be Redeemed
If less than all of the Notes are to be redeemed at any time, the Trustee
will select Notes for redemption as follows: (i) if the Notes are listed, in
compliance with the requirements of the principal national securities exchange
on which the Notes are listed; or (ii) if the Notes are not so listed, on a pro
rata basis, by lot or by such method as the Trustee shall deem fair and
appropriate. No Notes of $1,000 or less shall be redeemed in part. Notices of
redemption shall be mailed by first class mail at least 30 but not more than 60
days before the redemption date to each Holder of Notes to be redeemed at its
registered address. Notices of redemption may not be conditional. If any Note is
to be redeemed in part only, the notice of redemption that relates to that Note
shall state the portion of the principal amount thereof to be redeemed. A new
Note in principal amount equal to the unredeemed portion of the original Note
will be issued in the name of the Holder thereof upon cancellation of the
original Note. Notes called for redemption become due on the date fixed for
redemption. On and after the redemption date, Interest ceases to accrue on Notes
or portions of them called for redemption.
Section 3.03. Notice of Redemption
Subject to the provisions of Section 3.09 hereof, at least 30 days but not
more than 60 days before a redemption date, the Company shall mail or cause to
be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
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(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
Interest on Notes called for redemption ceases to accrue on and after the
redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant to
which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy of the
CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense; provided, however, that the Company
shall have delivered to the Trustee, at least 45 days prior to the redemption
date, an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.
Section 3.04. Effect of Notice of Redemption
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional.
Section 3.05. Deposit of Redemption Price
One Business Day prior to the redemption date, the Company shall deposit
with the Trustee or with the Paying Agent money sufficient to pay the redemption
price of and accrued Interest on all Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption price of, and accrued Interest on, all
Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph, on
and after the redemption date, Interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after a
Record Date but on or prior to the related Interest Payment Date, then any
accrued and unpaid Interest shall be paid to the Person in whose name such Note
was registered at the close of business on such Record Date. If any Note called
for redemption shall not be so paid upon surrender for redemption because of the
failure of the Company to comply with the preceding paragraph, Interest shall be
paid on the unpaid principal, from the redemption date until such principal is
paid, and to the extent lawful on any Interest not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01
hereof.
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Section 3.06. Notes Redeemed in Part
Upon surrender of a Note that is redeemed in part, the Company shall issue
and, upon the Company's written request, the Trustee shall authenticate for the
Holder at the expense of the Company a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
Section 3.07. Optional Redemption
(a) Except as set forth in clause (b) of this Section 3.07, the Company
shall not have the option to redeem the Notes pursuant to this Section 3.07
prior to May 1, 2002. Thereafter, the Company may redeem all or a part of the
Notes upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid Interest and Liquidated Damages thereon, if any, to the
applicable redemption date, if redeemed during the twelve-month period beginning
on May 1 of the years indicated below:
Year Percentage
---- ----------
2002................................................ 106.50%
2003................................................ 103.25%
2004 and thereafter................................. 100.00%
(b) Notwithstanding the provisions of clause (a) of this Section 3.07, at
any time prior to May 1, 2001, the Company may redeem up to 35% of the aggregate
principal amount of Notes at a redemption price of 113% of the principal amount
thereof, plus accrued and unpaid Interest and Liquidated Damages, if any, to the
redemption date, with the net cash proceeds of a Qualified Public Offering;
provided that (i) at least 65% in aggregate principal amount of the Notes issued
under this Indenture remains outstanding immediately after the occurrence of
such redemption (excluding Notes held by the Company and its Subsidiaries) and
(ii) the redemption must occur within 45 days of the date of the closing of such
Qualified Public Offering.
(c) Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof.
Section 3.08. Mandatory Redemption
Except as set forth under Sections 3.09, 4.10, 4.15, 4.28 and 4.29 hereof,
the Company shall not be required to make mandatory redemption or sinking fund
payments with respect to the Notes.
Section 3.09. Gaming Redemption
Notwithstanding any other provision of this Indenture, if any Gaming
Authority requires that a Holder or beneficial owner of Notes must be licensed,
qualified or found suitable under any applicable gaming law and such Holder or
beneficial owner fails to apply for a license, qualification or finding of
suitability within 30 days after being requested to do so by such Gaming
Authority (or such lesser period that may be required by such Gaming Authority),
42
or if such Holder or such beneficial owner is notified by such Gaming Authority
that such Holder or beneficial owner shall not be so licensed, qualified or
found suitable, the Company shall have the right, at its option, (i) to require
such Holder or beneficial owner to dispose of such Holder's or beneficial
owner's Notes within 30 days (or such lesser period as may be required by such
Gaming Authority) of (a) the termination of the period described above for such
Holder or beneficial owner to apply for a license, qualification or finding or
suitability or (b) receipt of the notice from such Gaming Authority that such
Holder or beneficial owner shall not be licensed, qualified or found suitable by
such Gaming Authority or (ii) to redeem the Notes of such Holder or beneficial
owner at a redemption price equal to the lesser of the principal amount thereof
or the price at which such Holder or beneficial owner acquired such Notes,
together with, in either case, accrued and unpaid Interest and Liquidated
Damages, if any, thereon to the earlier of the date of redemption or such
earlier date as may be required by such Gaming Authority or the date of the
finding of unsuitability by such Gaming Authority, which may be less than 30
days following the notice of redemption, if so ordered by such Gaming Authority.
Immediately upon a determination by a Gaming Authority that a Holder or
beneficial owner of Notes shall not be licensed, qualified or found suitable by
such Gaming Authority, such Holder or beneficial owner shall have no further
rights with respect to the Notes (i) to exercise, directly or indirectly,
through any Person, any right conferred by the Notes and (ii) to receive any
Interest or any other distribution or payment with respect to the Notes, or any
remuneration in any form from the Company for services rendered or otherwise,
except the redemption price of the Notes. The Company shall not be required to
pay or reimburse any Holder or beneficial owner of Notes who is required to
apply for such license, qualification or finding of suitability for the costs
relating thereto. Such expense shall, therefore, be the obligation of such
Holder or beneficial owner.
Section 3.10. Offer to Purchase by Application of Excess Proceeds
In the event that, pursuant to Section 4.10, 4.28 and 4.29 hereof, the
Company shall be required to commence an offer to all Holders to purchase Notes
(an "Asset Sale Offer," an "Event of Loss Offer" or an "Excess Cash Purchase
Offer," respectively, and each of which is referred to herein as an "Excess
Proceeds Offer"), it shall follow the applicable procedures specified below.
The Excess Proceeds Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law or permitted by another applicable
provision of this Indenture (the "Offer Period"). No later than five Business
Days after the termination of the Offer Period (the "Purchase Date"), the
Company shall purchase the principal amount of Notes required to be purchased
pursuant to Section 4.10, 4.28 or 4.29 hereof (the "Offer Amount") or, if less
than the Offer Amount has been tendered, all Notes tendered in response to the
Excess Proceeds Offer. Payment for any Notes so purchased shall be made in the
same manner as Interest payments are made.
If the Purchase Date is on or after a Record Date and on or before the
related Interest Payment Date, any accrued and unpaid Interest shall be paid to
the Person in whose name a Note is registered at the close of business on such
Record Date, and no additional Interest shall be payable to Holders who tender
Notes pursuant to the Excess Proceeds Offer.
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Upon the commencement of an Excess Proceeds Offer, the Company shall send,
by first class mail, a notice to the Trustee and each of the Holders, with a
copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Excess Proceeds
Offer. The Excess Proceeds Offer shall be made to all Holders. The notice, which
shall govern the terms of the Excess Proceeds Offer, shall state:
(a) that the Excess Proceeds Offer is being made pursuant to this Section
3.10 and either Section 4.10, 4.28 or 4.29 hereof and the length of time the
Excess Proceeds Offer shall remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue to
accrete or accrue Interest;
(d) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Excess Proceeds Offer shall cease to
accrete or accrue Interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an Excess
Proceeds Offer may elect to have Notes purchased in integral multiples of $1,000
only;
(f) that Holders electing to have a Note purchased pursuant to any Excess
Proceeds Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Company, a depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Xxxxxx is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by Holders
exceeds the Offer Amount, the Trustee shall select the Notes to be purchased on
a pro rata basis (with such adjustments as may be deemed appropriate by the
Company so that only Notes in denominations of $1,000, or integral multiples
thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Excess Proceeds
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
44
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in accordance
with the terms of this Section 3.10. The Company, the Depositary or the Paying
Agent, as the case may be, shall promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Notes tendered by such Holder and accepted by
the Company for purchase, and the Company shall promptly issue a new Note, and
the Trustee, upon written request from the Company shall authenticate and mail
or deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Excess Proceeds Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.10, any purchase
pursuant to this Section 3.10 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4 COVENANTS
Section 4.01. Payment of Notes
The Company shall pay or cause to be paid the principal of, premium, if
any, and Interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and Interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and Interest then due. If Interest payable on
the Notes includes Contingent Interest, the Company shall provide a calculation
of such Contingent Interest in reasonable detail to the Trustee in the form of
an Officer's Certificate at the time of depositing the amount of such Contingent
Interest with the Trustee. If Interest payable on the Notes does not include
Contingent Interest, the Company shall provide notice to the Trustee to that
effect. The Company shall pay all Liquidated Damages, if any, in the same manner
on the dates and in the amounts set forth in the Registration Rights Agreement.
If a Holder has given wire transfer instructions to the Company, the
Company will pay all principal, Interest, premium and Liquidated Damages, if
any, on that Holder's Notes in accordance with those instructions. All other
payments on notes shall be made at the office or agency of the Paying Agent and
Registrar within the City and State of New York unless the Company elects to
make Interest payments by check mailed to the Holders at their addresses set
forth in the register of Holders.
Section 4.02. Maintenance of Office or Agency
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
45
upon the Company in respect of the Notes and this Indenture may be served. The
Company shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Company may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
the City of New York for such purposes. The Company shall give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee as
one such office or agency of the Company in accordance with Section 2.03 hereof.
Section 4.03. Reports
(a) Whether or not required by the rules and regulations of the SEC, so
long as any Notes are outstanding, the Company shall furnish to the Holders of
Notes (i) all quarterly and annual financial information that would be required
to be contained in a filing with the SEC on Forms 10-Q and 10-K if the Company
were required to file such forms, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and, with respect to
the annual information only, a report thereon by the Company's certified
independent accountants and (ii) all current reports that would be required to
be filed with the SEC on Form 8-K if the Company were required to file such
reports, in each case, within the time periods specified in the SEC's rules and
regulations. If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by the preceding paragraph shall include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
thereto, and in Management's Discussion and Analysis of Financial Condition and
Results of Operations, of the financial condition and results of operations of
the Company and its Restricted Subsidiaries separate from the financial
condition and results of operations of the Unrestricted Subsidiaries of the
Company. In addition, following consummation of the Exchange Offer, whether or
not required by the rules and regulations of the SEC, the Company shall file a
copy of all such information and reports with the SEC for public availability
within the time periods specified in the SEC's rules and regulations (unless the
SEC will not accept such a filing) and make such information available to
securities analysts and prospective investors upon request. The Company shall at
all times comply with TIA ss 314(a).
(b) For so long as any Notes remain outstanding, the Company shall furnish
to the Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act.
46
Section 4.04. Compliance Certificate
(a) The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture and the Collateral Documents, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and the Collateral Documents
and is not in default in the performance or observance of any of the terms,
provisions and conditions of this Indenture or the Collateral Documents (or, if
a Default or Event of Default shall have occurred, describing all such Defaults
or Events of Default of which he or she may have knowledge and what action the
Company is taking or proposes to take with respect thereto) and that to the best
of his or her knowledge no event has occurred and remains in existence by reason
of which payments on account of the principal of or Interest, if any, on the
Notes is prohibited or if such event has occurred, a description of the event
and what action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Notes are outstanding, deliver
to the Trustee, forthwith upon any Officer becoming aware of any Default or
Event of Default or any Default (as defined in the Cash Collateral and
Disbursement Agreement) or Event of Default (as defined in the Cash Collateral
and Disbursement Agreement), an Officers' Certificate specifying such Default or
Event of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05. Taxes
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
47
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.07. Restricted Payments
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly: (i) declare or pay any dividend or make any other
payment or distribution on account of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any payment in
connection with any merger or consolidation involving the Company or any of its
Restricted Subsidiaries) or to the direct or indirect holders of the Company's
or any of its Restricted Subsidiaries' Equity Interests in their capacity as
such (other than dividends or distributions payable in Equity Interests (other
than Disqualified Stock) of the Company or dividends or distributions payable to
the Company or a Restricted Subsidiary of the Company); (ii) purchase, redeem or
otherwise acquire or retire for value (including without limitation, in
connection with any merger or consolidation involving the Company) any Equity
Interests of the Company or any direct or indirect parent of the Company; (iii)
make any payment on or with respect to, or purchase, redeem, defease or
otherwise acquire or retire for value any Indebtedness that is pari passu with
or subordinated to the Notes, except a payment of Interest or principal at
Stated Maturity thereof; or (iv) make any Restricted Investment (all such
payments and other actions set forth in clauses (i) through (iv) above being
collectively referred to as "Restricted Payments"), unless, at the time of and
after giving effect to such Restricted Payment:
(a) the Riviera Black Hawk is Operating;
(b) no Default or Event of Default shall have occurred and be continuing or
would occur as a consequence thereof; and
(c) the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in clause (ii) of the first paragraph of Section
4.09 hereof; and
(d) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Company and its Restricted Subsidiaries
after the date of this Indenture (excluding Restricted Payments permitted by
clause (ii) through (vii) of the next succeeding paragraph), is less than the
sum, without duplication, of (i) 50% of the Consolidated Net Income of the
Company for the period (taken as one accounting period) from the beginning of
the first fiscal quarter commencing after the date of this Indenture to the end
of the Company's most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a deficit, less 100% of such
48
deficit), plus (ii) 100% of the aggregate net cash proceeds received by the
Company since the date of this Indenture as a contribution to its common equity
capital (other than pursuant to the Completion Capital Commitment, the Keep-Well
Agreement and any contribution to the Company from Riviera Holdings of the net
proceeds of a Qualified Public Offering which are used to repurchase Notes) or
from the issue or sale of Equity Interests of the Company (other than
Disqualified Stock) or from the issue or sale of convertible or exchangeable
Disqualified Stock or convertible or exchangeable debt securities of the Company
that have been converted into or exchanged for such Equity Interests (other than
Equity Interests (or Disqualified Stock or debt securities) sold to a Subsidiary
of the Company), plus (iii) to the extent that any Restricted Investment that
was made after the date of this Indenture is sold for cash or otherwise
liquidated or repaid for cash, the lesser of (A) the cash return of capital with
respect to such Restricted Investment (less the cost of disposition, if any) and
(B) the initial amount of such Restricted Investment.
With respect to any payments made pursuant to clauses (i) through (vii)
below, so long as no Default has occurred and is continuing or would be caused
thereby and, with respect to any payments made pursuant to clause (viii) below,
no Event of Default or Default in the payment when due of any principal,
Interest, premium or Liquidated Damages on the Notes shall have occurred or be
continuing or would occur as a consequence thereof, the foregoing provisions
shall not prohibit (i) the payment of any dividend within 60 days after the date
of declaration thereof, if at said date of declaration such payment would have
complied with the provisions of this Indenture; (ii) the redemption, repurchase,
retirement, defeasance or other acquisition of any pari passu or subordinated
Indebtedness or Equity Interests of the Company in exchange for, or out of the
net cash proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Company) of, Equity Interests of the Company (other than any
Disqualified Stock); provided that the amount of any such net cash proceeds that
are utilized for any such redemption, repurchase, retirement, defeasance or
other acquisition shall be excluded from clause (d)(ii) of the preceding
paragraph; (iii) the defeasance, redemption, repurchase or other acquisition of
pari passu or subordinated Indebtedness with the net cash proceeds from an
incurrence of Permitted Refinancing Indebtedness; (iv) the payment to Riviera
Management of amounts owing to it pursuant to Section 3.4 and Article 4 of the
Management Agreement as in effect on the date of this Indenture, subject to the
terms of the Manager Subordination Agreement relating thereto between Riviera
Management and the Trustee and subject to the requirement that all such payments
are made in compliance with Section 4.27 hereof; provided, however, that
payments may be made pursuant to Section 3.4 of the Management Agreement whether
or not a Default has occurred and is continuing or would be caused thereby; (v)
any redemption required pursuant to Section 3.09 hereof; (vi) the repayment by
the Company to Riviera Holdings on the date of this Indenture of the Riviera
Advance; (vii) the payment by the Company to Riviera Holdings at any time after
the Riviera Black Hawk has been Operating for 180 consecutive days equal to the
amount contained in the Completion Reserve Account at the end of that period if
the Company's Fixed Charge Coverage Ratio for its most recently ended four
fiscal quarters after the date on which the Riviera Black Hawk became Operating
for which internal financial statements are available immediately preceding the
date on which such payment is to be made is at least 1.5 to 1; provided that if
at the time of such payment the Riviera Black Hawk has been Operating for less
than four fiscal quarters, such Fixed Charge Coverage Ratio will be calculated
with respect to the number of full fiscal quarters (but in no event less than
49
one full fiscal quarter) for which internal financial statements are available
following the date the Riviera Black Hawk first became Operating; and (viii) the
payment by the Company of amounts owing to Riviera Holdings pursuant to Sections
3 and 5 of the Tax Sharing Agreement as in effect on the date of this Indenture.
The amount of all Restricted Payments (other than cash) shall be the fair
market value on the date of the Restricted Payment of the asset(s) or securities
proposed to be transferred or issued by the Company or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any assets or securities that are required to be valued by this
Section 4.07 shall be determined by the Board of Directors whose resolution with
respect thereto shall be delivered to the Trustee, such determination to be
based upon an opinion or appraisal issued by an accounting, appraisal or
investment banking firm of national standing if such fair market value exceeds
$5.0 million. Not later than the date of making any Restricted Payment, the
Company shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed, together with a copy
of any fairness opinion or appraisal required by this Indenture.
Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective any encumbrance or restriction on the ability of any Restricted
Subsidiary to (a) pay dividends or make any other distributions on its capital
stock to the Company or any of its Restricted Subsidiaries or with respect to
any other interest or participation in, or measured by, its profits or pay any
indebtedness owed to the Company or any of its Restricted Subsidiaries, (b) make
loans or advances to the Company or any of its Restricted Subsidiaries or (c)
transfer any of its properties or assets to the Company or any of its Restricted
Subsidiaries, except for such encumbrances or restrictions existing under or by
reasons of (i) the Notes, this Indenture or the Collateral Documents; (ii) the
Riviera Holdings Indenture as in effect on the date of this Indenture; (iii)
applicable law; (iv) customary non-assignment provisions in leases entered into
in the ordinary course of business and consistent with past practices; (v)
Permitted Refinancing Indebtedness, provided that the restrictions contained in
the agreements governing such Permitted Refinancing Indebtedness are no more
restrictive, taken as a whole, than those contained in the agreements governing
the Indebtedness being refinanced; (vi) the acquisition of the Capital Stock of
any Person, or property or assets of any Person by the Company or any Restricted
Subsidiary, if the encumbrances or restrictions (a) existed at the time of the
acquisition and were not incurred in contemplation thereof and (b) are not
applicable to any Person or the property or assets of any Person other than the
Person acquired or the property or assets of the Person acquired; or (vii)
purchase money obligations or capital lease obligations for FF&E acquired with
FF&E Financing that impose restrictions of the type described in clause (c) of
the first paragraph of this Section 4.08 on the FF&E so acquired.
50
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect to
(collectively, "incur") any Indebtedness (including Acquired Debt) and the
Company shall not issue any Disqualified Stock and shall not permit any of its
Subsidiaries to issue any shares of preferred stock; provided, however, that so
long as no Default or Event of Default has occurred and is continuing, the
Company may incur Indebtedness (including Acquired Debt) or issue shares of
Disqualified Stock if:
(i) the Riviera Black Hawk is Operating;
(ii) the Fixed Charge Coverage Ratio for the Company's most recently
ended four full fiscal quarters for which internal financial statements are
available immediately preceding the date on which such additional
Indebtedness is incurred or such Disqualified Stock is issued would have
been at least 2.0 to 1, determined on a pro forma basis (including a pro
forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred, or preferred stock or the Disqualified
Stock had been issued, as the case may be, at the beginning of such
four-quarter period;
(iii) the Weighted Average Life to Maturity of such Indebtedness is
greater than the remaining Weighted Average Life to Maturity of the Notes;
The provisions of the first paragraph of this Section 4.09 shall not apply
to the incurrence of any of the following items of Indebtedness so long as no
Default or Event of Default has occurred and is continuing (collectively,
"Permitted Debt"):
(i) the incurrence by the Company and its Subsidiaries of (a)
Indebtedness represented by the Notes to be issued on the date of this
Indenture and the Series B Notes to be issued pursuant to the Registration
Rights Agreement and (b) their respective obligations arising under the
Collateral Documents to the extent such obligations would represent
Indebtedness;
(ii) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the
net proceeds of which are used to refund, refinance or replace Indebtedness
(other than intercompany Indebtedness) that was permitted by this Indenture
to be incurred under the first paragraph of this Section 4.09 or clauses
(i), (ii), (vi), (viii) or (x) of this paragraph;
(iii) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company and
any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
(a) such Indebtedness must be expressly subordinated to the prior
payment in full in cash of all Obligations with respect to the Notes;
and
51
(b) (1) any subsequent issuance or transfer of Equity Interests
that results in any such Indebtedness being held by a Person other
than the Company or a Wholly Owned Restricted Subsidiary thereof, (2)
any sale or other transfer of any such Indebtedness to a Person that
is not either the Company or a Wholly Owned Restricted Subsidiary
thereof shall be deemed, in each case, to constitute an incurrence of
such Indebtedness by the Company or such Restricted Subsidiary, as the
case may be, that was not permitted by this clause (iii) and (3) if
any Restricted Subsidiary is the obligor on such Indebtedness, such
Indebtedness is represented by an Intercompany Note that is pledged to
the Trustee as security for the Notes;
(iv) the incurrence by the Company or any of the Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose of
fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Indenture to be
outstanding;
(v) the incurrence by the Company of Indebtedness solely in respect of
performance or similar bonds or standby letters of credit; provided that
any such bond or standby letter of credit is incurred in the ordinary
course of the Company's business in an aggregate amount not to exceed $2.0
million at any one time outstanding; and provided, further, that any such
bond or standby letter of credit is incurred on terms customary for
operations similar to the Company's;
(vi) the incurrence by the Company of FF&E Financing; provided,
however, that (a) the principal amount of such Indebtedness does not exceed
the cost (including sales and excise taxes, installation and delivery
charges and other direct costs of, and other direct expenses paid or
charged in connection with, such purchase) of the FF&E purchased or leased
with the proceeds thereof, (b) no Indebtedness incurred under the Notes is
utilized for the purchase or lease of such FF&E and (c) the aggregate
principal amount of such Indebtedness, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any Indebtedness
incurred pursuant to this clause, does not exceed $15.0 million outstanding
at any time;
(vii) bond or surety obligations posted by the Company or any of its
Subsidiaries in order to prevent the loss or material impairment of or to
obtain a Gaming License or as otherwise required by an order of any Gaming
Authority to the extent required by applicable law and consistent in
character and amount with customary industry practice so long as such
Indebtedness does not result in, and is not secured by, a Lien on any of
the Collateral;
(viii) the incurrence by the Company of Indebtedness solely in respect
of Special Assessment Bonds, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any Indebtedness
incurred pursuant to this clause, and standby letters of credit or surety
bonds required to be issued in connection therewith, in an aggregate amount
not to exceed $400,000;
52
(ix) the Guarantee by the Company or a Restricted Subsidiary of
Indebtedness permitted to be incurred by another provision of this Section
4.09;
(x) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal amount
(or accreted value, as applicable) at any time outstanding, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or replace
any Indebtedness incurred pursuant to this clause, not to exceed $2.0
million; and
(xi) the incurrence by the Company's Unrestricted Subsidiaries of
Non-Recourse Debt; provided, however, that if any such Indebtedness ceases
to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be
deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of
the Company that was not permitted by this clause (xi).
The Company shall not incur any Indebtedness (including Permitted Debt)
that is contractually subordinated in right of payment to any other Indebtedness
of the Company unless such Indebtedness is also contractually subordinated in
right of payment to the Notes on substantially identical terms; provided,
however, that no Indebtedness of the Company shall be deemed to be contractually
subordinated in right of payment to any other Indebtedness of the Company solely
by virtue of being unsecured.
For purposes of determining compliance with this Section 4.09, in the event
that an item of proposed Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (xi) above or is
entitled to be incurred pursuant to the first paragraph of this Section 4.09,
the Company shall, in its sole discretion, classify such item of Indebtedness in
any manner that complies with this Section 4.09 and such item of Indebtedness
shall be treated as having been incurred pursuant to only one of such clauses or
pursuant to the first paragraph of this Section 4.09.
Section 4.10. Asset Sales
The Company shall not, and shall not permit any of its Subsidiaries to:
consummate an Asset Sale, unless:
(i) the Riviera Black Hawk is Operating;
(ii) the Company (or the Restricted Subsidiary, as the case may be)
receives consideration at the time of such Asset Sale at least equal to the
fair market value (evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee) of the assets
or Equity Interests issued or sold or otherwise disposed of;
(iii) such fair market value is determined by the Company's Board of
Directors and evidenced by a resolution of the Board of Directors set forth
in an Officers' Certificate delivered to the Trustee; and
53
(iv) at least 80% of the consideration received therefor by the
Company or such Restricted Subsidiary is in the form of cash or Cash
Equivalents; provided, however, that the amount of (A) any liabilities (as
shown on the Company's or such Restricted Subsidiary's most recent balance
sheet), of the Company or any Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms subordinated to the
Notes) that are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases the Company or such Restricted
Subsidiary from further liability; and (B) any securities, notes or other
obligations received by the Company or any such Restricted Subsidiary from
such transferee that, within 30 days of receipt, are converted by the
Company or such Restricted Subsidiary into cash (to the extent of the cash
received in that conversion), shall be deemed to be cash for purposes of
this provision.
Within 180 days after the receipt of any Net Proceeds from an Asset Sale,
the Company may apply such Net Proceeds to make a capital expenditure, improve
real property or acquire long-term assets that are used or useful in a line of
business permitted by Section 4.13 hereof; provided that the Company or such
Subsidiary, as the case may be, grants to the Trustee, on behalf of the Holders,
a first priority perfected security interest on any such property or assets
acquired or constructed with the Net Proceeds of any such Asset Sale on the
terms set forth in this Indenture and the Collateral Documents. Pending the
final application of any such Net Proceeds, the Company may invest such Net
Proceeds in Cash Equivalents which shall be pledged to the Trustee as security
for the Notes.
Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the preceding paragraph shall be deemed to constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds exceeds $5.0 million,
the Company shall make an offer to all Holders (an "Asset Sale Offer") and all
holders of other Indebtedness that is pari passu with the Notes to purchase the
maximum principal amount of Notes and such other pari passu Indebtedness that
may be purchased out of the Excess Proceeds, at an offer price in cash in an
amount equal to 100% of principal amount thereof plus accrued and unpaid
Interest and Liquidated Damages, if any, to the date of purchase, and shall be
in accordance with the provisions set forth in Section 3.10 hereof. If any
Excess Proceeds remain after consummation of an Asset Sale Offer, the Company
may use such Excess Proceeds for any purpose not otherwise prohibited by this
Indenture and the Collateral Documents. If the aggregate principal amount of
Notes and such other pari passu Indebtedness tendered into such Asset Sale Offer
exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and
such other pari passu Indebtedness to be purchased on a pro rata basis based on
the principal amount of Notes and such other pari passu Indebtedness tendered.
Upon completion of each Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero.
Section 4.11. Transactions with Affiliates
The Company shall not, and shall not permit any of its Subsidiaries to,
make any payment to, or sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter into
or make or amend any transaction, contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate (each of the
54
foregoing, an "Affiliate Transaction"), unless (a) such Affiliate Transaction is
on terms that are no less favorable to the Company or the relevant Restricted
Subsidiary than those that would have been obtained in a comparable transaction
by the Company or such Restricted Subsidiary with an unrelated Person and (b)
the Company delivers to the Trustee (i) with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $1.0 million, a resolution of the Board of Directors
set forth in an Officers' Certificate certifying that such Affiliate Transaction
complies with clause (a) above and that such Affiliate Transaction has been
approved unanimously by the Board of Directors and (ii) with respect to any
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $5.0 million, an opinion as to the fairness
to the Holders of such Affiliate Transaction from a financial point of view
issued by an accounting, appraisal or investment banking firm of national
standing; provided, however, that (i) payments made pursuant to the Completion
Capital Commitment, the Keep-Well Agreement, the Management Agreement, the
License Agreement and the Tax Sharing Agreement, in each case as in effect on
the date of this Indenture; (ii) purchases of goods and services in the ordinary
course of business; (iii) any employment agreement entered into by the Company
or any of its Restricted Subsidiaries in the ordinary course of business on
terms customary in the gaming industry; (iv) transactions between or among the
Company and/or its Restricted Subsidiaries; (v) Restricted Payments that are
permitted under Section 4.07 hereof; and (vi) reasonable fees and compensation
(including, without limitation, bonuses, retirement plans and securities, stock
options and stock ownership plans) paid or issued to and indemnities provided on
behalf of, officers, directors, employees or consultants of the Company or any
Restricted Subsidiary in the ordinary course of business shall not be deemed
Affiliate Transactions; provided, further, that subject to clauses (i) through
(vi) in the immediately preceding proviso, the Company will not make any loans,
advances or other payments to Riviera Holdings, except as permitted pursuant to
this Indenture, including Section 4.07 hereof.
Section 4.12. Liens
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly create, incur, assume or suffer to exist any Lien on any
asset now owned or hereafter acquired, or any income or profits therefrom or
assign or convey any right to receive income therefrom, except Permitted Liens.
Section 4.13. Line of Business
The Company shall not, and shall not permit any Subsidiary to, engage in
any business or investment activities other than the Permitted Business. Neither
the Company nor any of its Subsidiaries may conduct a Permitted Business in any
gaming jurisdiction in which the Company or such Subsidiary is not licensed on
the date of this Indenture if the Holders of the Notes would be required to be
licensed as a result thereof; provided that the provisions described in this
sentence shall not prohibit the Company or any of its Subsidiaries from
conducting a Permitted Business in any jurisdiction that does not require the
licensing or qualification of all the Holders, but reserves the discretionary
right to require the licensing or qualification of any Holders. The Company
shall not, and shall not permit any of its Subsidiaries to, engage in any
55
business, development or investment activity other than at or in conjunction
with the Riviera Black Hawk until the Riviera Black Hawk is Operating.
Section 4.14. Corporate Existence
Subject to Article 5 hereof, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence, and the corporate, partnership or other existence of each of its
Subsidiaries, in accordance with the respective organizational documents (as the
same may be amended from time to time) of the Company or any such Subsidiary and
(ii) the rights (charter and statutory), licenses and franchises of the Company
and its Subsidiaries; provided, however, that the Company shall not be required
to preserve any such right, license or franchise, or the corporate, partnership
or other existence of any of its Subsidiaries, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Notes.
Section 4.15. Offer to Repurchase Upon Change of Control
Upon the occurrence of a Change of Control, the Company shall make an offer
(a "Change of Control Offer") to each Holder to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of each Holder's Notes at a
purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid Interest and Liquidated Damages thereon, if any, to the date
of purchase (the "Change of Control Payment"). Within 10 days following any
Change of Control, the Company shall mail a notice to each Holder stating: (i)
that the Change of Control Offer is being made pursuant to this Section 4.15 and
that all Notes tendered shall be accepted for payment; (ii) the purchase price
and the purchase date, which shall be no earlier than 30 days and no later than
60 days from the date such notice is mailed (the "Change of Control Payment
Date"); (iii) that any Note not tendered shall continue to accrue Interest; (iv)
that, unless the Company defaults in the payment of the Change of Control
Payment, all Notes accepted for payment pursuant to the Change of Control Offer
shall cease to accrue Interest after the Change of Control Payment Date; (v)
that Holders electing to have any Notes purchased pursuant to a Change of
Control Offer shall be required to surrender the Notes, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Notes completed, to
the Paying Agent at the address specified in the notice prior to the close of
business on the third Business Day preceding the Change of Control Payment Date;
(vi) that Holders shall be entitled to withdraw their election if the Paying
Agent receives, not later than the close of business on the second Business Day
preceding the Change of Control Payment Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of Notes delivered for purchase, and a statement that such Xxxxxx is
withdrawing his election to have the Notes purchased; and (vii) that Holders
whose Notes are being purchased only in part shall be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered, which
unpurchased portion must be equal to $1,000 in principal amount or an integral
multiple thereof. The Company shall comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder
to the extent such laws and regulations are applicable in connection with the
repurchase of Notes in connection with a Change of Control.
56
On the Change of Control Payment Date, the Company shall, to the extent
lawful, (i) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all Notes or
portions thereof so tendered and (iii) deliver or cause to be delivered to the
Trustee the Notes so accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to each Holder of Notes so
tendered payment in an amount equal to the purchase price for the Notes, and the
Trustee shall promptly authenticate and mail (or cause to be transferred by book
entry) to each Holder a new Note equal in principal amount to any unpurchased
portion of the Notes surrendered by such Holder, if any; provided, that each
such new Note shall be in a principal amount of $1,000 or an integral multiple
thereof. The Company shall publicly announce the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date.
Notwithstanding the foregoing, the Company shall not be required to make a
Change of Control Offer upon a Change of Control if a third party makes the
Change of Control Offer in the manner, at the times and otherwise in compliance
with the requirements set forth in this Indenture applicable to a Change of
Control Offer made by the Company and purchases all Notes validly tendered and
not withdrawn under such Change of Control Offer.
Section 4.16. Limitation on Sale and Leaseback Transactions
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company may enter into a sale and leaseback transaction if (i) the Company
could have (a) incurred Indebtedness in an amount equal to the Attributable Debt
relating to such sale and leaseback transaction pursuant to the Fixed Charge
Coverage Ratio test set forth in the first paragraph of Section 4.09 hereof and
(b) incurred a Lien to secure such Indebtedness pursuant to the provisions of
Section 4.12 hereof, (ii) the gross cash proceeds of such sale and leaseback
transaction are at least equal to the fair market value (as determined in good
faith by the Board of Directors and set forth in an Officers' Certificate
delivered to the Trustee) of the property that is the subject of such sale and
leaseback transaction and (iii) the transfer of assets in such sale and
leaseback transaction is permitted by, and the Company applies the proceeds of
such transaction in compliance with, Section 4.10 hereof.
Section 4.17. Limitation on Issuances and Sales of Equity Interests in
Wholly Owned Subsidiaries
The Company (i) shall not, and shall not permit any Restricted Subsidiary
of the Company to, transfer, convey, sell, lease or otherwise dispose of any
Equity Interests of any Wholly Owned Subsidiary of the Company to any Person
(other than the Company or a Wholly Owned Subsidiary of the Company), unless (a)
such transfer, conveyance, sale, lease or other disposition is of all the Equity
Interests of such Wholly Owned Restricted Subsidiary and (b) the cash Net
Proceeds from such transfer, conveyance, sale, lease or other disposition are
applied in accordance with Section 4.10 hereof and (ii) shall not permit any
57
Wholly Owned Restricted Subsidiary of the Company to issue any of its Equity
Interests to any Person other than to the Company or a Wholly Owned Restricted
Subsidiary of the Company.
Section 4.18. Advances to Subsidiaries
All advances to Restricted Subsidiaries made by the Company after the date
of this Indenture shall be evidenced by unsecured Intercompany Notes in favor of
the Company that shall be pledged to the Trustee as Collateral to secure the
Notes. Each Intercompany Note shall be payable upon demand and shall bear
interest at the same rate as the Notes. A form of Intercompany Note is attached
as Exhibit E hereto. Repayments of principal with respect to any Intercompany
Note shall be required to be pledged to the Trustee as Collateral to secure the
Notes until such amounts are advanced to a Restricted Subsidiary in accordance
with the Indenture.
Section 4.19. Payments for Consent
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, to or for the benefit of
any Holder for or as an inducement to any consent, waiver or amendment of any of
the terms or provisions of this Indenture or the Notes unless such consideration
is offered to be paid or is paid to all Holders that consent, waive or agree to
amend in the time frame set forth in the solicitation documents relating to such
consent, waiver or agreement.
Section 4.20. Additional Subsidiary Guarantees
If the Company or any of its Restricted Subsidiaries shall acquire or
create another Subsidiary after the date of this Indenture, then such newly
acquired or created Restricted Subsidiary must become a Guarantor and execute a
Supplemental Indenture in the form attached as Exhibit I hereto and deliver an
Opinion of Counsel to the Trustee within ten Business Days of the date on which
it was acquired or created.
Section 4.21. Insurance
Until the Notes have been paid in full, the Company shall, and shall cause
its Restricted Subsidiaries to, maintain insurance with responsible carriers
against such risks and in such amounts as is customarily carried by similar
businesses with such deductibles, retentions, self insured amounts and
coinsurance provisions as are customarily carried by similar businesses of
similar size, including, without limitation, property and casualty, and, with
respect to insurance on the Collateral, shall have provided insurance
certificates evidencing such insurance to the Trustee on or prior to the Closing
Date and shall thereafter provide such certificates prior to the anniversary or
renewal date of each such policy, which certificate shall expressly state the
expiration date for each policy. Customary insurance coverage shall be deemed to
include the following:
(i) workers' compensation insurance to the extent required to comply
with all applicable state, territorial or United States laws and
regulations, or the laws and regulations of any other applicable
jurisdiction;
58
(ii) comprehensive general liability insurance with minimum limits of
$1.0 million;
(iii) umbrella or excess liability insurance providing excess
liability coverages over and above the foregoing underlying insurance
policies up to a minimum limit of $25.0 million;
(iv) business interruption insurance at all times on and after the
Riviera Black Hawk is Operating; and
(v) property insurance protecting the property against loss or damage
by fire, lightning, windstorm, tornado, water damage, vandalism, riot,
earthquake, civil commotion, malicious mischief, hurricane and such other
risks and hazards as are from time to time covered by an "all-risk" policy
or a property policy covering "special" causes of loss; provided, that such
insurance shall provide coverage of not less than the lesser of (a) 120% of
the outstanding principal amount of the Notes plus accrued and unpaid Fixed
Interest and (b) 100% of actual replacement value (as determined at each
policy renewal based on the X.X. Xxxxx Building Index or some other
recognized means) of any improvements customarily insured consistent with
industry standards and, in each case, with a deductible no greater than 2%
of the insured value of the Riviera Black Hawk or such greater amount as is
available on commercially reasonable terms (other than earthquake or flood
insurance, for which the deductible may be up to 10% of such replacement
value).
All insurance required under this Indenture (except worker's compensation)
shall name the Company and the Trustee as additional insureds or loss payees, as
the case may be, with losses in excess of $1.0 million payable jointly to the
Company and the Trustee (unless a Default or Event of Default has occurred and
is then continuing, in which case all losses are payable solely to the Trustee),
with no recourse against the Trustee for the payment of premiums, deductibles,
commissions or club calls, and for at least 30 days notice of cancellation. All
such insurance policies shall be issued by carriers having an A.M. Best &
Company, Inc. rating of A or higher and a financial size category of not less
than X, or if such carrier is not rated by A.M. Best & Company, Inc., having the
financial stability and size deemed appropriate by an opinion from a reputable
insurance broker. The Company shall deliver to the Trustee on the Closing Date
and each anniversary thereafter a certificate of an insurance agent stating that
the insurance policies obtained by the Company and its Restricted Subsidiaries
comply with this Section 4.21 and the related applicable provisions of the
Collateral Documents.
Section 4.22. Limitation on Status as Investment Company
The Company and its Subsidiaries are prohibited from being required to
register as an "investment company" (as that term is defined in the Investment
Company Act of 1940, as amended), or from otherwise becoming subject to
regulation under the Investment Company Act of 1940.
59
Section 4.23. Further Assurances
The Company shall, and shall cause each of its Restricted Subsidiaries to
do, execute, acknowledge, deliver, record, re-record, file, re-file, register
and re-register, as applicable, any and all such further acts, deeds,
conveyances, security agreements, mortgages, assignments, estoppel certificates,
financing statements and continuations thereof, termination statements, notices
of assignment, transfers, certificates assurances and other instruments as may
be required from time to time in order to: (i) carry out more effectively the
purposes of the Collateral Documents; (ii) subject to the Liens created by any
of the Collateral Documents any of the properties, rights or interests required
to be encumbered thereby; (iii) to perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and the Liens
intended to be created thereby; and (iv) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Trustee any of the rights
granted now or hereafter intended by the parties thereto to be granted to the
Trustee or under any other instrument executed in connection therewith or
granted to the Company under the Collateral Documents or under any other
instrument executed in connection therewith.
Section 4.24. Construction
The Company shall construct the Riviera Black Hawk, including the
furnishing, fixturing and equipping thereof, with diligence and continuity in a
good and workmanlike manner substantially in accordance with the Plans to which
the Company is a party and in accordance with the Cash Collateral and
Disbursement Agreement.
Section 4.25. Limitation on Use of Proceeds
The Company shall deposit $5.1 million of the net proceeds of the Offering
into the Interest Reserve Account, $31.9 million of the net proceeds of the
Offering in the Construction Disbursement Account and $5.0 million of the net
proceeds of the Offering in the Completion Reserve Account. The funds in the
Interest Reserve Account, the Construction Disbursement Account and the
Completion Reserve Account shall be invested solely in Government Securities.
All funds in the Cash Collateral Accounts shall be disbursed only in accordance
with the Cash Collateral and Disbursement Agreement.
Section 4.26. Collateral Documents, Completion Capital Commitment and Keep-Well
Agreement
Neither the Company nor any of its Restricted Subsidiaries shall amend,
waive or modify, or take or refrain from taking any action that has the effect
of amending, waiving or modifying any provision of any of the Collateral
Documents, the Completion Capital Commitment or the Keep-Well Agreement, to the
extent that such amendment, waiver, modification or action could reasonably be
expected to have an adverse effect on the rights of the Trustee or the Holders;
provided that (i) the Collateral may be released or modified as expressly
provided in this Indenture and in the Collateral Documents; (ii) the Plans and
the Construction Disbursement Budget may be amended as expressly provided in the
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Cash Collateral and Disbursement Agreement; and (iii) this Indenture and any of
the Collateral Documents may be otherwise amended, waived or modified as set
forth in Article 9 hereof.
Section 4.27. Restriction on Payment of Management Fees
The Company shall not, directly or indirectly, pay to Riviera Management or
any of its Affiliates any Management Fees, except pursuant to the Management
Agreement as in effect on the date of, and in accordance with, this Indenture.
Amounts payable pursuant to the Management Agreement shall not be prepaid, and
no payment of Management Fees, either current or accrued, shall be made if at
the time of payment of such Management Fees (i) a Default or an Event of Default
shall have occurred and be continuing or shall occur as a result thereof; or
(ii) the Company's Fixed Charge Coverage Ratio for its most recently ended four
full fiscal quarters for which internal financial statements are available
immediately preceding the date on which such Management Fee is proposed to be
paid would have been less than 1.5 to 1 (calculated on a pro forma basis after
deducting Management Fees to the extent paid in cash and not deferred and any
Management Fees deferred from a prior period proposed to be paid in cash during
such period, but excluding any Management Fees deferred or accrued and not paid
in cash during such period). With respect to periods following the date the
Riviera Black Hawk first becomes Operating and prior to the time when internal
financial statements are available for four full fiscal quarters following the
date the Riviera Black Hawk first becomes Operating, such Fixed Charge Coverage
Ratio shall be calculated with respect to the number of full fiscal quarters
(but in no event less than one full fiscal quarter) for which internal financial
statements are available following the date the Riviera Black Hawk first becomes
Operating. Any Management Fees not permitted to be paid pursuant to this Section
4.27 shall be deferred and shall accrue and may be paid only at such time that
they would otherwise be permitted to be paid hereunder. The right to receive
payment of the Management Fee shall be subordinate in right of payment to the
right of the Holders to receive payments pursuant to the Notes. The Company
shall not amend the Management Agreement to increase amounts to be paid
thereunder, or in any other manner which would be adverse to the Company or the
Holders, including without limitation, to amend the method of computing the
Management Fee; provided, however, that the foregoing shall not prohibit any
amendment required by any Gaming Law or Gaming Authority.
Section 4.28. Event of Loss
Within 360 days after any Event of Loss with respect to any Collateral with
a fair market value (or replacement cost, if greater) in excess of $1.0 million,
the Company or the affected Restricted Subsidiary of the Company, as the case
may be, may apply the Net Loss Proceeds from such Event of Loss to the
rebuilding, repair, replacement or construction of improvements to the Riviera
Black Hawk, with no concurrent obligation to make any purchase of any Notes;
provided that (i) the Company delivers to the Trustee within 60 days of such
Event of Loss a written opinion from a reputable architect that the Riviera
Black Hawk with at least the Minimum Facilities can be rebuilt, repaired,
replaced or constructed and Operating within 360 days of the Event of Loss; (ii)
an Officers' Certificate certifying that the Company has available from Net Loss
Proceeds or other sources sufficient funds to complete the rebuilding, repair,
replacement or construction described in clause (i) above; and (iii) the Net
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Loss Proceeds are less than $20.0 million. If the Net Loss Proceeds to be used
for rebuilding, repair, replacement or construction exceed $5.0 million, then
the Net Loss Proceeds shall be deposited in the Construction Disbursement
Account and disbursed in accordance with the procedures set forth in the Cash
Collateral and Disbursement Agreement. Any Net Loss Proceeds that are not
reinvested or not permitted to be reinvested as provided in the first sentence
of this paragraph shall be deemed "Excess Loss Proceeds." When the aggregate
amount of Excess Loss Proceeds exceeds $5.0 million, the Company shall make an
offer to all Holders (an "Event of Loss Offer") to purchase the maximum
principal amount of Notes that may be purchased out of the Excess Loss Proceeds,
at a purchase price in cash in an amount equal to 100% of the principal amount
thereof, plus accrued and unpaid Interest and Liquidated Damages, if any,
thereon to the date of purchase. The Event of Loss Offer shall be conducted in
accordance with Section 3.10. The date of purchase shall not be less than 30 or
more than 60 days from the date of the Event of Loss Offer. To the extent that
the aggregate principal amount of Notes tendered pursuant to an Event of Loss
Offer exceeds the Excess Loss Proceeds, the Trustee shall select the Notes to be
purchased in the manner described under Section 3.02 hereof. To the extent that
the aggregate amount of Notes tendered pursuant to any Event of Loss Offer is
less than the Excess Loss Proceeds, the Company may, subject to the other
provisions of this Indenture and the Collateral Documents, use any remaining
Excess Loss Proceeds for general corporate purposes. Upon completion of any such
Event of Loss Offer, the amount of Excess Loss Proceeds shall be reset at zero.
Pending any permitted rebuilding, repair, replacement or construction or the
completion of any Event of Loss Offer, the Company or the affected Restricted
Subsidiary, as the case may be, shall pledge to the Trustee as additional
Collateral any Net Loss Proceeds or other cash on hand required for such
permitted rebuilding, repair, replacement or construction pursuant to the terms
of the Collateral Documents. These pledged funds shall be released to the
Company to pay for or reimburse the Company for the actual cost of such
permitted rebuilding, repair, replacement or construction, or such Event of Loss
Offer, pursuant to the terms of the Collateral Documents. Pending the final
application of the Net Loss Proceeds, such proceeds shall be invested in Cash
Equivalents which shall be pledged to the Trustee as security for the Notes. The
Company or the applicable Restricted Subsidiary shall grant to the Trustee, on
behalf of the Holders, a first priority lien, subject to Permitted Liens, on any
property or asset rebuilt, repaired, replaced or constructed with such Net Loss
Proceeds on the terms set forth in this Indenture and the Collateral Documents.
With respect to any Event of Loss pursuant to clause (iv) of the definition of
"Event of Loss" that has a fair market value (or replacement cost, if greater)
in excess of $5.0 million, the Company (or the affected Restricted Subsidiary,
as the case may be), shall be required to receive consideration at least (i)
equal to the fair market value (evidenced by a resolution of the Board of
Directors set forth in an Officers' Certificate delivered to the Trustee) of the
assets subject to the Event of Loss and (ii) at least 90% of which is in the
form of Cash Equivalents.
Section 4.29. Excess Cash Purchase Offers
Within 120 days after each Operating Year of the Company, beginning with
the first Operating Year after the Riviera Black Hawk becomes Operating, the
Company shall make an offer to all Holders (the "Excess Cash Flow Offer") to
purchase the maximum principal amount of Notes that is an integral multiple of
$1,000 that may be purchased with 50% of the Company's Excess Cash Flow in
respect of the Operating Year then ended (the "Excess Cash Flow Offer Amount"),
at a purchase price in cash equal to 101% of the principal amount of the Notes
to be purchased, plus accrued and unpaid Interest and Liquidated Damages, if
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any, thereon to the date fixed for the closing of the Excess Cash Flow Offer
(the "Excess Cash Flow Purchase Price"), in accordance with this Indenture. The
Event of Loss Offer shall be conducted in accordance with Section 3.10. Upon the
expiration of the Event of Loss Offer, the Company shall apply the Excess Cash
Flow Offer Amount to the purchase of all Notes tendered at the Excess Cash Flow
Offer Purchase Price. If the aggregate principal amount of Notes tendered
pursuant to an Excess Cash Flow Offer exceeds the Excess Cash Flow Offer Amount
with respect thereto, the Trustee shall select the Notes to be repurchased in
the manner described under Section 3.02 hereof. To the extent that the aggregate
amount of Notes tendered pursuant to any Excess Cash Flow Offer is less than the
Excess Cash Flow Offer Amount, the Company may, subject to the other provisions
of this Indenture and the Collateral Documents, use any remaining Excess Cash
Flow for general corporate purposes.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets
The Company shall not, directly or indirectly, consolidate or merge with or
into (whether or not the Company is the surviving corporation), or sell, assign,
transfer, convey or otherwise dispose of all or substantially all of its
properties or assets of the Company and its Subsidiaries taken as a whole, in
one or more related transactions to, another Person unless (i) the Company is
the surviving corporation or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, conveyance or other disposition shall have been made is a
corporation organized or existing under the laws of the United States, any state
thereof or the District of Columbia, (ii) the Person formed by or surviving any
such consolidation or merger (if other than the Company) or the Person to which
such sale, assignment, transfer, conveyance or other disposition shall have been
made assumes all the obligations of the Company under the Notes, this Indenture
and the Collateral Documents pursuant to a supplemental indenture in a form
reasonably satisfactory to the Trustee, (iii) immediately after such
transaction, no Default or Event of Default exists (iv) such transaction would
not result in the loss or suspension or material impairment of any Gaming
License unless a comparable replacement Gaming License is effective prior to or
simultaneously with such loss, suspension or material impairment; (v) the
Company or the Person formed by or surviving any such consolidation or merger
(if other than the Company), or to which such sale, assignment, transfer,
conveyance or other disposition shall have been made: (a) shall have
Consolidated Net Worth immediately after the transaction equal to or greater
than the Consolidated Net Worth of the Company immediately preceding the
transaction; and (b) shall, on the date of such transaction after giving pro
forma effect thereto and any related financing transactions as if the same had
occurred at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in clause (ii) of the first paragraph of Section
4.09 hereof; and (vi) such transaction would not require any Holder or
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beneficial owner of Notes to obtain a Gaming License or be qualified or found
suitable under the law of any applicable gaming jurisdiction; provided that such
Holder or beneficial owner would not have been required to obtain a Gaming
License or be qualified or found suitable under the laws of any applicable
gaming jurisdiction in the absence of such transaction. In addition, the Company
shall not, directly or indirectly, lease all or substantially all of its
properties or assets, in one or more related transactions, to any other Person.
The provisions of this Section 5.01 shall not be applicable to a sale,
assignment, transfer, conveyance or other disposition of assets between or among
the Company and any of its Wholly Owned Subsidiaries.
Section 5.02. Successor Corporation Substituted
Upon any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company in accordance with Section 5.01 hereof, the successor corporation formed
by such consolidation or into or with which the Company is merged or to which
such sale, assignment, transfer, lease, conveyance or other disposition is made
shall succeed to, and be substituted for (so that from and after the date of
such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and Interest on the Notes except in the case of a sale of all of
the Company's assets that meets the requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default
An "Event of Default" occurs and is continuing under this Indenture if:
(a) the Company defaults for 30 days in the payment when due of Interest
on, or Liquidated Damages with respect to, the Notes; provided that payments of
Contingent Interest that are permitted to be deferred as provided in this
Indenture will not become due for this purpose until such payment is required to
be made pursuant to the terms of this Indenture;
(b) the Company defaults in the payment when due of principal of or
premium, if any, on the Notes;
(c) the Company fails to comply with any of the provisions of Section 4.09,
4.10, 4.15, 4.25 or 5.01 hereof;
(d) the Company or any of its Restricted Subsidiaries for 30 days after
notice thereof fails to comply with the provisions of Section 4.07 hereof and
any of the other agreements in this Indenture not set forth in clause (c) above;
(e) a default occurs under any mortgage, indenture or instrument 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 of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
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Restricted Subsidiaries) whether such Indebtedness or guarantee now exists, or
is created after the date of this Indenture, if that default: (i) is caused by a
failure to pay principal of, or interest or premium, if any, on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (ii) results
in the acceleration of such Indebtedness prior to its express maturity, and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$5.0 million or more;
(f) the Company or any of its Restricted Subsidiaries fails to pay final
judgments aggregating in excess of $5.0 million, which judgments are not paid,
discharged or stayed for a period of 60 days; and
(g) the Company or any of its Affiliates breaches any representation or
warranty in any material respect in the Collateral Documents or any certificates
delivered in connection therewith, the Company or any of its Affiliates fails
for 30 days (or such other period as specifically provided therein) after notice
thereof to comply with any covenant or agreement set forth in the Collateral
Documents, the Company repudiates any of its obligations under the Collateral
Documents, the Collateral Documents become unenforceable against the Company or
perfection or priority of the Liens granted by the Company thereunder is lost
for any reason;
(h) the Company or any of its Significant Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary
pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors, or
(v) generally is not paying its debts as they become due; or
(i) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary in an involuntary case;
(ii) appoints a custodian of the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary or for all or substantially all of the
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property of the Company or any of its Significant Subsidiaries or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary; or
(iii) orders the liquidation of the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days;
(j) the revocation, termination, suspension or other cessation of
effectiveness for a period of more than 90 consecutive days of any Gaming
License results in the cessation or suspension of gaming operations at any
Gaming Facility;
(k) Riviera Holdings defaults in the performance of its obligations set
forth in, or repudiates its obligations under, the Completion Capital Commitment
or the Keep-Well Agreement; or
(l) the Riviera Black Hawk fails to be Operating by the Operating Deadline
or fails to remain Operating thereafter, except (a) as the hours of operation of
the Riviera Black Hawk may be limited by any Gaming Authority or Gaming Law or
(b) for a period of time not to exceed 30 days during any 45-day period and not
to exceed 60 days during any one-year period; provided, however, that, in any
event, there shall not be an Event of Default under this clause if the failure
to remain Operating during such period results from an Event of Loss pursuant to
the terms of this Indenture.
Section 6.02. Acceleration
If any Event of Default (other than an Event of Default specified in clause
(h) or (i) of Section 6.01 hereof with respect to the Company, any Restricted
Subsidiary that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary)
occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately. Upon any such declaration, the Notes shall become
due and payable immediately. Notwithstanding the foregoing, if an Event of
Default specified in clause (h) or (i) of Section 6.01 hereof occurs with
respect to the Company, any Restricted Subsidiary that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary, all outstanding Notes shall be due and
payable immediately without further action or notice. In the case of any Event
of Default occurring by reason of any willful action or inaction taken or not
taken by or on behalf of the Company with the intention of avoiding payment of
the premium that the Company would have had to pay if the Company then had
elected to redeem the Notes pursuant to Section 3.07 hereof, an equivalent
premium shall also become and be immediately due and payable to the extent
permitted by law upon the acceleration of the Notes. If an Event of Default
occurs prior to May 1, 2002, by reason of any willful action (or inaction) taken
66
(or not taken) by or on behalf of the Company with the intention of avoiding the
prohibition on redemption of the Notes prior to May 1, 2002, then the premium
specified in this Indenture shall also become immediately due and payable to the
extent permitted by law upon the acceleration of the Notes.
Section 6.03. Other Remedies
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal, premium, if any, and
Interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes by notice to the Trustee may on behalf of the Holders of
all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium and Liquidated Damages, if any, or Interest
on, the Notes (including in connection with an offer to purchase) (provided,
however, that the Holders of a majority in aggregate principal amount of the
then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration).
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
Section 6.05. Control by Majority
Holders of a majority in principal amount of the then outstanding Notes may
direct the time, method and place of conducting any proceeding for exercising
any remedy available to the Trustee or exercising any trust or power conferred
on it. However, the Trustee may refuse to follow any direction that conflicts
with law or this Indenture that the Trustee determines may be unduly prejudicial
to the rights of other Holders of Notes or that may involve the Trustee in
personal liability.
Section 6.06. Limitation on Suits
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
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(b) the Holders of at least 25% in principal amount of the then outstanding
Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal amount
of the then outstanding Notes do not give the Trustee a direction inconsistent
with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07. Rights of Holders of Notes to Receive Payment
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and Interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder;
provided that a Holder shall not have the right to institute any such suit for
the enforcement of payment if and to the extent that the institution or
prosecution thereof or the entry of judgment therein would, under applicable
law, result in the surrender, impairment, waiver or loss of the Lien of the
Indenture upon any property subject to such Lien.
Section 6.08. Collection Suit by Trustee
If an Event of Default specified in Section 6.01(a) or (b) hereof occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and Interest remaining
unpaid on the Notes and Interest on overdue principal and, to the extent lawful,
Interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim
The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
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the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof and amounts due to the Trustee under the Collateral
Documents, including without limitation, the Cash Collateral and
Disbursement Agreement, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium and Liquidated Damages, if any, and Interest,
ratably, without preference or priority of any kind, according to the
amounts due and payable on the Notes for principal, premium and Liquidated
Damages, if any and Interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section does
not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant to
Section 6.07 hereof, or a suit by Holders of more than 10% in principal amount
of the then outstanding Notes.
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ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the express
provisions of this Indenture and the Trustee need perform only those duties that
are specifically set forth in this Indenture and no others, and no implied
covenants or obligations shall be read into this Indenture against the Trustee;
and
(ii) in the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture. However, the Trustee shall
examine the certificates and opinions to determine whether or not they conform
to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(iii)the Trustee shall not be liable with respect to any action it takes or
omits to take in good faith in accordance with a direction received by it
pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
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(g) Notwithstanding anything to the contrary contained in this Indenture,
or the other Collateral Documents, in the event the Trustee is entitled or
required to commence an action to foreclose on any Collateral or otherwise
exercise its remedies to acquire control or possession of any part of the
Collateral and solely to the extent that the Trustee shall have determined in
good faith that the indemnification provided to the Trustee under Section 7.07
does not or will not adequately protect and indemnify it from and against the
liability described immediately below, the Trustee shall not be required to
commence any such action or exercise any such remedy with respect to such part
of the Collateral if the Trustee has determined in good faith (and upon written
advice of outside counsel) that the Trustee is reasonably likely to incur
liability under any foreign, federal, state or local law or regulation relating
to the protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants unless the Trustee has
received security or indemnity or other surety in an amount and in a form
reasonably satisfactory to the Trustee protecting the Trustee from all such
liability.
Section 7.02. Rights of Trustee
(a) The Trustee may conclusively rely upon any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company shall be sufficient if signed by
an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
Section 7.03. Individual Rights of Trustee
The Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee. However, in
the event that the Trustee acquires any conflicting interest it must eliminate
such conflict within 90 days, apply to the SEC for permission to continue as
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trustee or resign. Any Agent may do the same with like rights and duties. The
Trustee is also subject to Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium, if any,
Interest or Liquidated Damages on any Note, the Trustee may withhold the notice
if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of the Holders of the
Notes.
Section 7.06. Reports by Trustee to Holders of the Notes
(a) Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA ss 313(a) (but if no event described in
TIA ss 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA ss
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss 313(c).
(b) A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA ss 313(d). The
Company shall promptly notify the Trustee when the Notes are listed on any stock
exchange.
(c) At the expense of the Company, the Trustee or, if the Trustee is not
the Registrar, the Registrar, shall report the names of record holders of the
Notes to any Gaming Authority when requested to do so by the Company.
(d) At the express direction of the Company and at the Company's expense,
the Trustee shall provide any Gaming Authority with:
(i) copies of all notices, reports and other written communications
which the Trustee gives to Holders;
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(ii) a list of all of the Holders promptly after the original issuance
of the Notes and periodically thereafter if the Company so directs;
(iii) notice of any Default under this Indenture, any acceleration of
the Indebtedness evidenced hereby, the institution of any legal actions or
proceedings before any court or governmental authority in respect of a
Default or Event of Default hereunder;
(iv) notice of the removal or resignation of the Trustee within five
Business Days of the effectiveness thereof;
(v) notice of any transfer or assignment of rights under this
Indenture known to the Trustee within five Business Days thereof; and
(vi) a copy of any amendment to the Notes or this Indenture within
five Business Days of the effectiveness thereof.
(e) To the extent requested by the Company and at the Company's expense,
the Trustee shall cooperate with any Gaming Authority in order to provide such
Gaming Authority with the information and documentation requested and as
otherwise required by applicable law.
Section 7.07. Compensation and Indemnity
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture and the
Collateral Documents, including the costs and expenses of enforcing this
Indenture against the Company (including this Section 7.07) and defending itself
against any claim (whether asserted by the Company or any Holder or any other
person) or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its negligence or bad faith. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Company shall not relieve the Company of
its obligations hereunder. The Company shall defend the claim and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel. The Company
need not pay for any settlement made without its consent, which consent shall
not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive the
satisfaction and discharge of this Indenture.
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To secure the Company's payment obligations in this Section, the Trustee
shall have a Lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and Interest on
particular Notes. Such Lien shall survive the satisfaction and discharge of this
Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(h) or (i) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss 313(b)(2) to the
extent applicable.
Section 7.08. Replacement of Trustee
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section; provided, however, that if the Trustee
does not receive the security, indemnity or surety described in Section 7.01(g)
in connection with any potential liability described therein, the Trustee may
resign effective upon 30 days written notice to the Holders and the Company.
The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Company. The Holders of a majority in
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company in writing. The Company may remove the
Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company. If
any Gaming Authority requires a Trustee to be approved, licensed or qualified
and the Trustee fails or declines to do so, such approval, license or
qualification shall be obtained upon the request of, and at the expense of, the
Company unless the Trustee declines to do so, or, if the Trustee's relationship
with the Company may, in the Company's discretion, jeopardize any material
gaming license or franchise or right or approval granted thereto, the Trustee
shall resign, and, in addition, the Trustee may at its option resign if the
Trustee in its sole discretion determines not to be as approved, licensed or
qualified.
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If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in principal amount of the then outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder who has been a Holder
for at least six months, fails to comply with Section 7.10 hereof, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders. The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee, provided all sums owing to the Trustee
hereunder have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Xxxxxx, etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the requirements
of TIA ss310(a)(1), (2) and (5). The Trustee is subject to TIA ss310(b).
Section 7.11. Preferential Collection of Claims Against Company
The Trustee is subject to TIA ss 311(a), excluding any creditor
relationship listed in TIA ss 311(b). A Trustee who has resigned or been removed
shall be subject to TIA ss311(a) to the extent indicated therein.
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ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article Eight. Upon
either legal Defeasance or Covenant Defeasance, the security interests in
Collateral shall be terminated pursuant to Section 10.08 hereof.
Section 8.02. Legal Defeasance and Discharge
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in Section
8.04 hereof, and as more fully set forth in such Section, payments in respect of
the principal of, premium, if any, Liquidated Damages, if any, and Interest on
such Notes when such payments are due, (b) the Company's obligations with
respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Company's
obligations in connection therewith and (d) this Article Eight. Subject to
compliance with this Article Eight, the Company may exercise its option under
this Section 8.02 notwithstanding the prior exercise of its option under Section
8.03 hereof.
Section 8.03. Covenant Defeasance
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Sections 4.03, 4.04, 4.05, 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18, 4.19, 4.20, 4.21,
4.23, 4.24, 4.25, 4.26, 4.27, 4.28, 4.29 and 5.01 hereof with respect to the
outstanding Notes on and after the date the conditions set forth in Section 8.04
hereof are satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
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purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Notes shall
be unaffected thereby. In addition, upon the Company's exercise under Section
8.01 hereof of the option applicable to this Section 8.03 hereof, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, Sections
6.01(c) through 6.01(g), 6.01(j) through 6.01(l) hereof shall not constitute
Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance
The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders, cash in U.S. dollars, non-callable Government
Securities, or a combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public accountants,
to pay the principal of, and Fixed Interest, the maximum amount payable as
Contingent Interest and premium and Liquidated Damages, if any, on the
outstanding notes on the stated maturity or on the applicable redemption date,
as the case may be, and the Company must specify whether the Notes are being
defeased to maturity or to a particular redemption date;
(b) in the case of Legal Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that (i) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling or (ii) since the date of this
Indenture, there has been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such Opinion of Counsel shall
confirm that, the Holders of the outstanding Notes will not recognize income,
gain or loss for federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such Legal
Defeasance had not occurred;
(c) in the case of Covenant Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that the Holders of the outstanding Notes will not recognize income,
gain or loss for federal income tax purposes as a result of such Covenant
Defeasance and will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be continuing on
the date of such deposit (other than a Default or Event of Default resulting
from the borrowing of funds to be applied to such deposit);
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(e) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under any material agreement or
instrument (other than the indenture) to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound;
(f) the Company must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders over the other creditors of the Company with the intent
of defeating, hindering, delaying or defrauding creditors of the Company or
others; and
(g) the Company must deliver to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent relating to the
Legal Defeasance or the Covenant Defeasance have been complied with.
Section 8.05. Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and Interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article Eight to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a) hereof), are in excess of the amount thereof that would then be required
to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06. Repayment to Company
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
Interest on any Note and remaining unclaimed for two years after such principal,
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and premium, if any, or Interest has become due and payable shall be paid to the
Company on its request or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Note shall thereafter look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining shall be repaid to the Company.
Section 8.07. Reinstatement
If the Trustee or Paying Agent is unable to apply any United States dollars
or non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, premium, if any, or Liquidated Damages, if any, or
Interest on any Note following the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Notes to receive such
payment from the money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes
Notwithstanding Section 9.02 of this Indenture, without the consent of any
Holder of Notes, the Company and the Trustee may amend or supplement this
Indenture or the Notes :
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Notes by a successor to the Company pursuant to Article 5 hereof;
(d) to make any change that would provide any additional rights or benefits
to the Holders of the Notes or that does not adversely affect the legal rights
hereunder of any Holder;
(e) to comply with requirements of the SEC in order to effect or maintain
the qualification of this Indenture under the TIA;
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(f) to provide for the issuance of Additional Notes in accordance with the
limitations set forth in this Indenture as of the date hereof; or
(g) to provide for additional Subsidiary Guarantees as set forth in Section
4.20 hereof.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company in the execution of any
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes
Except as provided below in this Section 9.02, the Company and the Trustee
may amend or supplement this Indenture (including Sections 3.10, 4.10, 4.15,
4.28 and 4.29 hereof) and the Notes with the consent of the Holders of at least
a majority in principal amount of the Notes (including Additional Notes, if any)
then outstanding consents obtained in connection with a tender offer or exchange
offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07
hereof, any existing Default or Event of Default (other than a Default or Event
of Default in the payment of the principal of, premium, if any, or Interest on
the Notes, except a payment default resulting from an acceleration that has been
rescinded) or compliance with any provision of this Indenture or the Notes may
be waived with the consent of the Holders of a majority in principal amount of
the then outstanding Notes (including consents obtained in connection with a
tender offer or exchange offer for, or purchase of, the Notes). Without the
consent of at least 66-2/3% in aggregate principal amount of the Notes then
outstanding an amendment or waiver may not affect the Liens in favor of the
Trustee and the Holders created under the Collateral Documents in a manner
adverse to the Holders or release all or substantially all of the Collateral, in
each case, other than pursuant to the release of Collateral in accordance with
the provisions of this Indenture and of the applicable Collateral Documents.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Company in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but shall not be obligated to, enter into
such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
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After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes then outstanding may waive
compliance in a particular instance by the Company with any provision of this
Indenture or the Notes. However, without the consent of each Holder affected, an
amendment or waiver under this Section 9.02 may not (with respect to any Notes
held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent to an
amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note or
alter or waive any of the provisions with respect to the redemption of the Notes
except as provided above with respect to Sections 3.10, 4.10 and 4.15 hereof;
(c) reduce the rate of or change the time for payment of Interest on any
Note;
(d) waive a Default or Event of Default in the payment of principal of, or
Interest or premium, or Liquidated Damages, if any, on the Notes (except a
rescission of acceleration of the Notes by the Holders of at least a majority in
aggregate principal amount of the Notes and a waiver of the payment default that
resulted from such acceleration);
(e) make any Note payable in money other than that stated in the Notes;
(f) make any change in the provisions of this Indenture relating to waivers
of past Defaults or the rights of Holders of Notes to receive payments of, or
Interest or premium or Liquidated Damages, if any, on the Notes; or
(g) waive a redemption payment with respect to any Note (other than a
payment required by Sections 3.10, 4.10 and 4.15 hereof).
Section 9.03. Compliance with Trust Indenture Act
Every amendment or supplement to this Indenture or the Notes shall be set
forth in a amended or supplemental Indenture that complies with the TIA as then
in effect.
Section 9.04. Revocation and Effect of Consents
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Xxxxxx's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
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revoke the consent as to its Note if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article Nine if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully
protected in relying upon, in addition to the documents required by Section
11.04 hereof, an Officer's Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental indenture is authorized or
permitted by this Indenture.
ARTICLE 10
COLLATERAL AND SECURITY
Section 10.01. Security
The due and punctual payment of the principal of and Interest and premium,
if any, and Liquidated Damages, if any, on the Notes when and as the same shall
be due and payable, whether on an Interest Payment Date, at maturity, by
acceleration, repurchase, redemption or otherwise, and Interest on the overdue
principal of and Interest and Liquidated Damages (to the extent permitted by
law), if any, on the Notes and performance of all other obligations of the
Company to the Holders of Notes or the Trustee under this Indenture and the
Notes, according to the terms hereunder or thereunder, shall be ratably secured
by a Lien on the Collateral owned by the Company. Each Holder of Notes, by its
acceptance thereof, consents and agrees to the terms of the Collateral Documents
(including, without limitation, the provisions providing for foreclosure and
release of Collateral) as the same may be in effect or may be amended from time
to time in accordance with its terms and authorizes and directs the Trustee to
enter into the Collateral Documents and to perform its obligations and exercise
its rights thereunder in accordance therewith. The Company shall deliver to the
Trustee copies of all documents executed pursuant to this Indenture and the
Collateral Documents, and shall do or cause to be done all such acts and things
as may be necessary or proper, or as may be required by the provisions of the
Collateral Documents, to assure and confirm to the Trustee the security interest
82
in the Collateral contemplated hereby, as from time to time constituted, so as
to render the same available for the security and benefit of this Indenture and
of the Notes secured hereby, according to the intent and purposes herein
expressed. The Company shall take, or shall cause its Subsidiaries to take, upon
request of the Trustee, any and all actions reasonably required to create and
maintain, as security for the Obligations of the Company hereunder, a valid and
enforceable perfected first priority Lien in and on all the Collateral, in favor
of the Trustee for the benefit of the Holders of Notes, superior to and prior to
the rights of all third Persons and subject to no other Liens than Permitted
Liens, including executing, as applicable, a Pledge Agreement in the form
attached hereto as Exhibit F, a Collateral Assignment of Patent in the form
attached hereto as Exhibit G and a Collateral Assignment of Copyright in the
form attached hereto as Exhibit H.
Section 10.02. Recording and Opinions
(a) The Company shall cause the applicable Collateral Documents including
the Deed of Trust and any financing statements, fixture filings, intellectual
property filings, all amendments or supplements to each of the foregoing and any
other similar security documents as necessary, to be registered, recorded and
filed and/or re-recorded, re-filed and renewed in such manner and in such place
or places, if any, as may be required by law or reasonably requested by the
Trustee in order fully to preserve and protect the Liens, and the priority
thereof, securing the obligations under the Notes pursuant to the Collateral
Documents.
(b) The Company shall furnish to the Trustee:
(i) promptly after the execution and delivery of this Indenture, and
promptly after the execution and delivery of any supplemental indenture or
other amendment to any Collateral Document, an Opinion of Counsel in the
United States either (A) stating that in the opinion of such counsel, this
Indenture, the Collateral Documents and all other instruments of further
assurance or amendment have been properly recorded, registered and filed to
the extent necessary to make effective the Lien intended to be created by
such Collateral Documents and other instruments and reciting the details of
such action or refer to prior Opinions of Counsel in which such details are
given, and stating that, as to such Collateral Documents and such other
instruments, such recording, registering and filing are the only
recordings, registering and filings necessary to give notice thereof and
that no re-recordings, re-registering or re-filings are necessary to
maintain such notice, and further stating that all financing statements,
continuation statements, fixture filings and intellectual property filings
have been executed and filed that are necessary fully to preserve and
protect the rights of the Holders of Notes and the Trustee hereunder and
under the Collateral Documents and other instruments or (B) stating that,
in the opinion of such counsel, no such action is necessary to make any
other Lien created under any of the Collateral Documents effective as
intended by such Collateral Documents; and
(ii) On June 1, in each year beginning with the year 2000, 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 this
Indenture and all supplemental indentures, financing statements,
continuation statements, fixture filings, intellectual property filings, or
other instruments of further assurance as is necessary to maintain the
83
Liens of this Indenture, and the Collateral Documents and other instruments
until the next Opinion of Counsel is required to be rendered pursuant to
this paragraph and reciting the details of such action or referring to
prior Opinions of Counsel in which such details are given, and stating that
all financing statements, continuation statements, fixture filings,
intellectual property filings, have been executed and filed that are
necessary to preserve and protect the rights of the Holders and the Trustee
hereunder, and under the Collateral Documents and other instruments or (B)
stating that, in the opinion of such counsel, no such action is necessary
to maintain such Liens, until the next Opinion of Counsel is required to be
rendered pursuant to this paragraph.
(c) The Company shall otherwise comply with the provisions of TIA
ss314(b).
Section 10.03. Release of Collateral
(a) Subject to subsections (b), (c) and (d) of this Section 10.03,
Collateral may be released from the Lien and security interest created by this
Indenture and the Collateral Documents at any time or from time to time in
accordance with the provisions of the Collateral Documents or as provided
hereby. In addition, upon the request of the Company pursuant to an Officers'
Certificate certifying that all conditions precedent hereunder have been met and
stating whether or not such release is in connection with an Asset Sale, and the
Trustee shall release (at the sole cost and expense of the Company) (i)
Collateral that is sold, conveyed or disposed of in compliance with the
provisions of this Indenture; provided, that if such sale, conveyance or
disposition constitutes an Asset Sale, the Company shall apply the Net Proceeds
in accordance with Section 4.10 hereof. Upon receipt of such Officers'
Certificate the Trustee shall execute, deliver or acknowledge any necessary or
proper instruments of termination, satisfaction or release to evidence the
release of any Collateral permitted to be released pursuant to this Indenture or
the Collateral Documents.
(b) No Collateral shall be released from the Lien and security interest
created by the Collateral Documents pursuant to the provisions of the Collateral
Documents unless there shall have been delivered to the Trustee the certificate
required by this Section 10.03.
(c) At any time when a Default or Event of Default shall have occurred and
be continuing and the maturity of the Notes shall have been accelerated (whether
by declaration or otherwise) and the Trustee shall have delivered a notice of
acceleration to the Trustee, no release of Pledged Collateral pursuant to the
provisions of the Collateral Documents shall be effective as against the Holders
of Notes.
(d) The release of any Collateral from the terms of this Indenture and the
Collateral Documents shall not be deemed to impair the security under this
Indenture in contravention of the provisions hereof if and to the extent the
Collateral is released pursuant to the terms hereof. To the extent applicable,
the Company shall cause TIA ss 313(b), relating to reports, and TIA ss 314(d),
relating to the release of property or securities from the Lien and security
interest of the Collateral Documents and relating to the substitution therefor
of any property or securities to be subjected to the Lien and security interest
of the Collateral Documents, to be complied with. Any certificate or opinion
required by TIA ss 314(d) may be made by an Officer of the Company except in
84
cases where TIA ss 314(d) requires that such certificate or opinion be made by
an independent Person, which Person shall be an independent engineer, appraiser
or other expert selected or approved by the Trustee in the exercise of
reasonable care.
Section 10.04. Certificates of the Company
The Company shall furnish to the Trustee, prior to each proposed release of
Collateral pursuant to the Collateral Documents, (i) all documents required by
TIA ss314(d) and (ii) an Opinion of Counsel, which may be rendered by internal
counsel to the Company, to the effect that such accompanying documents
constitute all documents required by TIA ss314(d). The Trustee may, to the
extent permitted by Sections 7.01 and 7.02 hereof, accept as conclusive evidence
of compliance with the foregoing provisions the appropriate statements contained
in such documents and such Opinion of Counsel.
Section 10.05. Certificates of the Trustee
In the event that the Company wishes to release Collateral in accordance
with the Collateral Documents and has delivered the certificates and documents
required by the Collateral Documents and Sections 10.03 and 10.04 hereof, the
Trustee shall determine whether it has received all documentation required by
TIA ss314(d) in connection with such release and, based on such determination
and the Opinion of Counsel delivered pursuant to Section 10.04(b) hereof, shall
deliver a certificate to the Company setting forth such determination.
Section 10.06. Authorization of Actions to Be Taken by the Trustee Under the
Collateral Documents
Subject to the provisions of Section 7.01 and 7.02 hereof, the Trustee may,
in its sole discretion and without the consent of the Holders of Notes, take on
behalf of the Holders of Notes, all actions it deems necessary or appropriate in
order to (a) enforce any of the terms of the Collateral Documents and (b)
collect and receive any and all amounts payable in respect of the Obligations of
the Company hereunder. The Trustee shall have power to institute and maintain
such suits and proceedings as it may deem expedient to prevent any impairment of
the Collateral by any acts that may be unlawful or in violation of the
Collateral Documents or this Indenture, and such suits and proceedings as the
Trustee may deem expedient to preserve or protect its interests and the
interests of the Holders of Notes in the Collateral (including power to
institute and maintain suits or proceedings to restrain the enforcement of or
compliance with any legislative or other governmental enactment, rule or order
that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of the Holders of Notes or
of the Trustee).
Subject to certain gaming and bankruptcy laws, upon an Event of Default and
so long as such Event of Default continues, the Trustee may exercise in respect
of the Collateral, in addition to the other rights and remedies provided for
herein, in the Collateral Documents or otherwise available to it, all of the
rights and remedies of a secured party under the Uniform Commercial Code or
other applicable law, and the Trustee may also upon obtaining possession of the
Collateral as set forth herein, without notice to the Company, except as
85
specified below, sell the Collateral or any part thereof in one or more parcels
at public or private sale, at any exchange, broker's board or at any of the
Trustee's offices or elsewhere, for cash, on credit or for future delivery, and
upon such other terms as the Trustee may deem commercially reasonable. The
Company acknowledges and agrees that any such private sale may result in prices
and other terms less favorable to the seller than if such a sale were a public
sale. The Company agrees that, to the extent notice of sale shall be required by
law, at least ten days' notice to the Company of the time and place of any
public sale or the time after which any private sale is to be made shall
constitute reasonable notification. The Trustee shall not be obligated to make
any sale regardless of notice of sale having been given. The Trustee may adjourn
any public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
Section 10.07. Authorization of Receipt of Funds by the Trustee Under the
Collateral Documents
The Trustee is authorized to receive any funds for the benefit of the
Holders of Notes distributed under the Collateral Documents, and to make further
distributions of such funds to the Holders of Notes according to the provisions
of this Indenture.
Section 10.08. Termination of Security Interest
Upon the payment in full of all Obligations of the Company under this
Indenture, the Collateral Documents and the Notes, or upon Legal Defeasance or
Covenant Defeasance, the Trustee shall, at the request of the Company, deliver a
certificate to the Company stating that such Obligations have been paid in full,
and take all actions necessary to release the Liens pursuant to this Indenture
and the Collateral Documents.
Section 10.09. Cooperation Of Trustee
In the event the Company pledges or grants a security interest in
additional Collateral, the Trustee shall cooperate with the Company in
reasonably and promptly agreeing to the form of, and executing as required, any
instruments or documents necessary to make effective the security interest in
the Collateral to be so substituted or pledged. To the extent practicable, the
terms of any security agreement or other instrument or document necessitated by
any such substitution or pledge shall be comparable to the provisions of the
existing Collateral Documents. Subject to, and in accordance with the
requirements of this Article 10 and the terms of the Collateral Documents, in
the event that the Company engages in any transaction pursuant to Section 10.3
hereof, the Trustee shall cooperate with the Company in order to facilitate such
transaction in accordance with any reasonable time schedule proposed by the
Company, including delivering and releasing the Collateral in a prompt and
reasonable manner.
Section 10.10. Collateral Agent
The Trustee may, from time to time, appoint one or more collateral agents
hereunder ("Collateral Agents"). Each of such Collateral Agents may be delegated
any one or more of the duties or rights of the Trustee hereunder or under the
Collateral Documents or that are specified in any Collateral Documents,
86
including, without limitation, the right to hold any Collateral in the name of,
registered to, or in the physical possession of, such Collateral Agent, for the
ratable benefit of the Holders of the Notes. Each such Collateral Agent shall
have such rights and duties as may be specified in an agreement between the
Trustee and such Collateral Agent.
ARTICLE 11
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA ss318(c), the imposed duties shall control.
Section 11.02. Notices
Any notice or communication by the Company or the Trustee to the others is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company: Riviera Black Hawk, Inc.
000 Xxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: President
With a copy to: Dechert Price & Xxxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxx, Esq.
If to the Trustee: IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Department
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
87
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA ss 313(c), to the extent required by the TIA. Failure to
mail a notice or communication to a Holder or any defect in it shall not affect
its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
Section 11.03. Communication by Holders of Notes with Other Holders of Notes
Holders may communicate pursuant to TIA ss 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA
ss 312(c).
Section 11.04. Certificate and Opinion as to Conditions Precedent
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 11.05
hereof) stating that, in the opinion of the signers, all conditions precedent
and covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory to
the Trustee (which shall include the statements set forth in Section 11.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
Section 11.05. Statements Required in Certificate or Opinion
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss 314(a)(4)) shall comply with the provisions of TIA ss 314(e)
and shall include:
(a) a statement that the Person making such certificate or opinion has read
such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
88
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been satisfied.
Section 11.06. Rules by Trustee and Agents
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 11.07. No Personal Liability of Directors, Officers, Employees and
Stockholders
No past, present or future director, officer, employee, incorporator or
stockholder of the Company, as such, shall have any liability for any
obligations of the Company under the Notes, this Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
Section 11.08. Governing Law
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 11.09. No Adverse Interpretation of Other Agreements
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 11.10. Successors
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
Section 11.11. Severability
In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
89
Section 11.12. Counterpart Originals
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 11.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
Section 11.14. Gaming and Liquor Laws
The terms and provisions of this Indenture, including, but not limited to,
all rights and remedies of the Trustee and powers of attorney and appointment,
are expressly subject to all laws, statutes, regulations and orders affecting
limited gaming or the sale of liquor (collectively, the "Gaming and Liquor
Laws"), in the State of Colorado, which may include, but not be limited to, the
necessity for the Trustee to obtain the prior approval of the regulatory
agencies enforcing the Gaming or Liquor Laws before taking any action hereunder
and to be licensed by such regulatory agencies before exercising certain rights
and remedies hereunder.
[Signatures on following page]
SIGNATURES
Dated as of June 3, 1999 RIVIERA BLACK HAWK, INC.
By:
--------------------------------------
Name: Xxxxx Xxxxx
Title: Chief Financial Officer, Treasurer
and Secretary
Dated as of June 3, 1999 IBJ WHITEHALL BANK & TRUST
COMPANY
By:
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Assistant Vice President
[Signature page to the Indenture]
EXHIBIT A
[Face of Note]
--------------------------------------------------------------------------------
CUSIP NO: 76962P AA 8
% [Series A] [Series B] First Mortgage Notes due 2005
---
With Contingent Interest
No. $
---- -------------
RIVIERA BLACK HAWK, INC.
promises to pay to
-------------------------------------------------------------
or registered assigns,
the principal sum of
-----------------------------------------------------------
Dollars on May 1, 2005.
Interest Payment Dates: May 1 and November 1
Record Dates: April 15 and October 15
Dated: ,
--------------- ------
RIVIERA BLACK HAWK, INC.
By:
------------------------------------
Name:
Title:
This is one of the [Global] Notes referred to
in the within-mentioned Indenture:
IBJ WHITEHALL BANK & TRUST COMPANY,
as Trustee
By:
-----------------------------------
Authorized Signatory
A-1
[Back of Note]
-----% [Series A] [Series B] First Mortgage Notes due 2005
With Contingent Interest
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used herein shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
1. Interest. Riviera Black Hawk, Inc., a Colorado corporation (the
"Company"), promises to pay Fixed Interest on the principal amount of this Note
at 13% per annum from June 3, 1999 until maturity and shall pay the Liquidated
Damages payable pursuant to Section 5 of the Registration Rights Agreement
referred to below. The Company shall pay Fixed Interest and Liquidated Damages
semi-annually in arrears on May 1 and November 1 of each year, or if any such
day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Fixed Interest on the Notes shall accrue from the most
recent date to which Fixed Interest has been paid or, if no Fixed Interest has
been paid, from the date of issuance; provided that if there is no existing
Default in the payment of Fixed Interest, and if this Note is authenticated
between a record date referred to on the face hereof (each a "Record Date") and
the next succeeding Interest Payment Date, Interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be November 1, 1999. Interest shall be computed on the basis
of a 360-day year of twelve 30-day months.
In addition, the Notes will bear Contingent Interest after the Riviera
Black Hawk begins Operating. Installments of accrued Contingent Interest will be
payable semi-annually in arrears on each Interest Payment Date after the Riviera
Black Hawk begins Operating to the Holders on the Record Date applicable to the
relevant Interest Payment Date, unless all or a portion of the installment is
permitted to be deferred as described in the next sentence; provided, that no
Contingent Interest is payable with respect to any period prior to the date on
which the Riviera Black Hawk becomes Operating. The Company may defer payment of
all or a portion of any installment of Contingent Interest then otherwise due
and may continue to defer the payment of any installment of Contingent Interest
which has already been deferred if, and only to the extent that:
(1) the payment of that portion of Contingent Interest will cause the
Company's Adjusted Fixed Charge Coverage Ratio for the four
consecutive fiscal quarters ending immediately prior to the
applicable Record Date to be less than 1.5 to 1.0 on a pro forma
basis after giving effect to the assumed payment of the Contingent
Interest (but may not defer such portion, which, if paid, would
not cause such Adjusted Fixed Charge Coverage Ratio to be less
than 1.5 to 1.0); and
(2) the principal amount of the Notes corresponding to that Contingent
Interest has not then matured and become due and payable, whether
A-2
at stated maturity, upon acceleration, upon redemption, upon
maturity of a repurchase obligation or otherwise.
Contingent Interest that is deferred will become due and payable, in whole
or in part, upon the earlier of:
(1) the next succeeding Interest Payment Date on which all or a
portion of that Contingent Interest is not permitted to be
deferred; and
(2) the maturity of the corresponding principal amount of the Notes,
whether at stated maturity, upon acceleration, upon redemption,
upon maturity of a repurchase obligation or otherwise.
However, all installments of accrued or deferred Contingent Interest will
become immediately payable with respect to any Notes that mature, whether at
stated maturity, upon acceleration, upon redemption, upon maturity of a
repurchase obligation or otherwise.
The amount of Contingent Interest payable for any period will be reduced
pro rata for reductions in the outstanding principal amount of the Notes prior
to the close of business on the Record Date immediately preceding the applicable
Interest Payment Date. No interest will accrue on any Contingent Interest that
is deferred and which does not become due and payable.
Each installment of Contingent Interest will be calculated to accrue (each
an "Accrual Period") as follows:
(1) from, but not including, the most recent Semiannual Period for
which Contingent Interest has been paid or through which
Contingent Interest had been calculated and deferred; or
(2) if no installment of Contingent Interest has been paid for or
deferred, from and including the date on which the Riviera Black
Hawk becomes Operating;
to, and including, the earlier of:
(a) the last day of the Semiannual Period immediately following the
Semiannual Period referred to in clause (1) above if the
corresponding principal amount of the Notes has not become due and
payable; or
(b) the date of payment if the corresponding principal amount of the
Notes has become due and payable, whether at stated maturity, upon
acceleration, upon redemption, upon maturity of repurchase
obligation or otherwise.
With respect to each Accrual Period, Contingent Interest will accrue daily
on the principal amount of each Note outstanding during such period as follows:
A-3
(1) for any portion of an Accrual Period which consists of all or part
of a Semiannual Period that ends during such Accrual Period, 1/180
of the Contingent Interest with respect to such principal amount
for such Semiannual Period until fully accrued; and
(2) for any other portion of an Accrual Period, 1/180 of the
Contingent Interest with respect to such principal amount for the
Semiannual Period that began and last ended after the date on
which the Riviera Black Hawk becomes Operating.
2. Method of Payment. The Company shall pay Interest on the Notes (except
defaulted Interest) and Liquidated Damages to the Persons who are registered
Holders of Notes at the close of business on the Record Dates next preceding the
Interest Payment Date, even if such Notes are canceled after such Record Date
and on or before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted Interest. The Notes shall be payable
as to principal, premium and Liquidated Damages, if any, and Interest at the
office or agency of the Company maintained for such purpose within or without
the City and State of New York, or, at the option of the Company, payment of
Interest and Liquidated Damages may be made by check mailed to the Holders at
their addresses set forth in the register of Holders, and provided that payment
by wire transfer of immediately available funds shall be required with respect
to principal of and Interest, premium and Liquidated Damages on, all Global
Notes and all other Notes the Holders of which shall have provided wire transfer
instructions to the Company or the Paying Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
3. Paying Agent and Registrar. Initially, IBJ Whitehall Bank & Trust
Company, the Trustee under the Indenture, shall act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. Indenture and Collateral Documents. The Company issued the Notes under
an Indenture dated as of June 3, 1999 ("Indenture"), between the Company and the
Trustee. The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S. Code ssss 77aaa-77bbbb). The Notes are subject to all such
terms, and Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are obligations of the Company that are limited in
aggregate principal amount to the amount borrowed under the Indenture and are
secured by a first lien on the Collateral, whether now owned or hereafter
acquired, subject to Permitted Liens, pursuant to the terms of the Collateral
Documents.
A-4
5. Optional Redemption.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the
Company shall not have the option to redeem the Notes prior to May 1, 2002. On
or after such date, the Company may redeem all or a part of the Notes upon not
less than 30 nor more than 60 days' notice, at the redemption prices (expressed
as percentages of principal amount) set forth below plus accrued and unpaid
Interest and Liquidated Damages thereon to the applicable redemption date, if
redeemed during the twelve-month period beginning on May 1 of the years
indicated below:
Year Percentage
---- ----------
2002.................................................... 106.50%
2003.................................................... 103.25%
2004 and thereafter..................................... 100.000%
(b) Notwithstanding the provisions of subparagraph (a) of this Paragraph 5,
at any time prior to May 1, 2001, the Company may redeem up to 35% of the
aggregate principal amount of the Notes at a redemption on price of 113% of the
principal amount thereof, plus accrued and unpaid Interest and Liquidated
Damages, if any, to the redemption date, with the net proceeds of a Qualified
Public Offering; provided that (i) at least 65% of the aggregate principal
amount of the Notes issued under the Indenture remain outstanding immediately
after the occurrence of such redemption (excluding Notes held by the Company and
its Subsidiaries); and (ii) the redemption must occur within 45 days of the date
of the closing of such Qualified Public Offering.
6. Gaming Redemption. Notwithstanding the provisions of subparagraph (a) of
Paragraph 5 above, if any Gaming Authority requires that a Holder or beneficial
owner of Notes must be licensed, qualified or found suitable under any
applicable gaming law and such Holder or beneficial owner fails to apply for a
license, qualification or finding of suitability within 30 days after being
requested to do so by such Gaming Authority (or such lesser period that may be
required by such Gaming Authority), or if such Holder or such beneficial owner
is notified by such Gaming Authority that such Holder or beneficial owner shall
not be so licensed, qualified or found suitable, the Company shall have the
right, at its option, (i) to require such Holder or beneficial owner to dispose
of such Holder's or beneficial owner's Notes within 30 days (or such lesser
period as may be required by such Gaming Authority) of (a) the termination of
the period described above for such Holder or beneficial owner to apply for a
license, qualification or finding or suitability or (b) receipt of the notice
from such Gaming Authority that such Holder or beneficial owner shall not be
licensed, qualified or found suitable by such Gaming Authority or (ii) to redeem
the Notes of such Holder or beneficial owner at a redemption price equal to the
lesser of the principal amount thereof or the price at which such Holder or
beneficial owner acquired such Notes, together with, in either case, accrued and
unpaid Interest and Liquidated Damages, if any, thereon to the earlier of the
date of redemption or such earlier date as may be required by such Gaming
Authority or the date of the finding of unsuitability by such Gaming Authority,
which may be less than 30 days following the notice of redemption, if so ordered
by such Gaming Authority.
A-5
7. Mandatory Redemption.
Except as set forth in paragraph 8 below, the Company shall not be required
to make mandatory redemption or sinking fund payments with respect to the Notes.
8. Repurchase at Option of Holder.
(a) If there is a Change of Control, the Company shall be required to make
an offer (a "Change of Control Offer") to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of each Holder's Notes at a purchase
price equal to 101% of the aggregate principal amount thereof plus accrued and
unpaid Interest and Liquidated Damages thereon, if any, to the date of purchase.
Within 10 days following any Change of Control, the Company shall mail a notice
to each Holder setting forth the procedures governing the Change of Control
Offer as required by the Indenture.
(b) If the Company or a Subsidiary consummates any Asset Sales, within five
days of each date on which the aggregate amount of Excess Proceeds exceeds $5.0
million, the Company shall commence an offer to all Holders of Notes (an "Asset
Sale Offer") pursuant to Section 3.10 of the Indenture to purchase the maximum
principal amount of Notes that may be purchased out of the Excess Proceeds at an
offer price in cash in an amount equal to 100% of the principal amount thereof
plus accrued and unpaid Interest and Liquidated Damages thereon, if any, to the
date fixed for the closing of such offer, in accordance with the procedures set
forth in the Indenture. To the extent that the aggregate amount of Notes
tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the
Company (or such Subsidiary) may use such deficiency for general corporate
purposes. If the aggregate principal amount of Notes surrendered by Holders
thereof exceeds the amount of Excess Proceeds, the Trustee shall select the
Notes to be purchased on a pro rata basis. Holders of Notes that are the subject
of an offer to purchase shall receive an Asset Sale Offer from the Company prior
to any related purchase date and may elect to have such Notes purchased by
completing the form entitled "Option of Holder to Elect Purchase" on the reverse
of the Notes.
(c) Within 120 days after each Operating Year of the Company, beginning
with the first Operating Year after the Riviera Black Hawk becomes Operating,
the Company shall make an offer to all Holders (an "Excess Cash Flow Offer") to
purchase the maximum principal amount of Notes that is an integral multiple of
$1,000 that may be purchased with 50% of the Company's Excess Cash Flow in
respect of the Operating Year then ended (the "Excess Cash Flow Offer Amount"),
at a purchase price equal to 101% of the principal amount of Notes to be
purchased, plus accrued and unpaid Interest and Liquidated Damages, if any, to
the date fixed for the closing of such Excess Cash Flow Offer (the "Excess Cash
Flow Purchase Price"), in accordance with the procedures set forth in Section
3.10 of the Indenture. To the extent that the aggregate principal amount of
Notes tendered pursuant to any Excess Cash Flow Offer is less than the Excess
Cash Flow Offer Amount with respect thereto, the Company may, subject to the
other provisions of the Indenture, use any remaining Excess Cash Flow for
general corporate purposes. Holders of Notes that are the subject of an offer to
purchase shall receive an Excess Cash Flow Offer from the Company prior to any
A-6
related purchase date and may elect to have such Notes purchased by completing
the form entitled "Option of Holder to Elect Purchase" on the reverse of the
Notes.
(d) If the Company or a Restricted Subsidiary suffers an Event of Loss,
then pursuant to Section 4.28 of the Indenture, when the aggregate amount of
Excess Loss Proceeds exceeds $5.0 million, the Company shall make an offer to
all Holders (an "Event of Loss Offer") to purchase the maximum principal amount
of Notes that may be purchased out of the Excess Loss Proceeds, at a purchase
price in cash in an amount equal to 100% of the principal amount thereof, plus
accrued and unpaid Interest and Liquidated Damages, if any, thereon to the date
fixed for the closing of such offer, in accordance with the procedures set forth
in Section 3.10 of the Indenture. To the extent that the aggregate amount of
Notes tendered pursuant to any Event of Loss Offer is less than the Excess Loss
Proceeds, the Company may use any remaining Excess Loss Proceeds for general
corporate purposes. Holders of Notes that are the subject of an offer to
purchase may elect to have such Notes purchased by completing the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Notes.
9. Notice of Redemption. Notice of redemption shall be mailed at least 30
days but not more than 60 days before the redemption date to each Holder whose
Notes are to be redeemed at its registered address. Notes in denominations
larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000, unless all of the Notes held by a Holder are to be redeemed. On and
after the redemption date Interest ceases to accrue on Notes or portions thereof
called for redemption.
10. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a Record
Date and the corresponding Interest Payment Date.
11. Persons Deemed Owners. The registered Holder of a Note may be treated
as its owner for all purposes.
12. Amendment, Supplement and Waiver. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with the consent of the
Holders of at least a majority in principal amount of the then outstanding
Notes, and any existing default or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Without the consent
of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company's obligations to Holders of the Notes
A-7
in case of a merger or consolidation, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights under the Indenture of any such Holder, to
comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act or to provide for
the issuance of Additional Notes in accordance with the limitations set forth in
the Indenture.
13. Defaults and Remedies. Events of Default include: (a) default for 30
days in the payment when due of Interest or Liquidated Damages on the Notes;
provided that payments of Contingent Interest that are permitted to be deferred
as provided in this provision will not become due for this purpose until such
payment is required to be made pursuant to the terms of the Indenture; (b)
default in payment when due of principal of or premium, if any, on the Notes,
(c) failure by the Company to comply with Sections 4.09, 4.10, 4.15 or 5.01 of
the Indenture; (d) the Company or any of its Restricted Subsidiaries for 30 days
after notice thereof fails to comply with the provisions of Section 4.07 and any
of the other agreements in this Indenture not set forth in clause (c) above; (e)
a default occurs under any mortgage, indenture or instrument 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 of its Restricted Subsidiaries (or the
payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries) whether such Indebtedness or guarantee now exists, or is created
after the date of this Indenture, if that default: (i) is caused by a failure to
pay principal of, or interest or premium, if any, on such Indebtedness prior to
the expiration of the grace period provided in such Indebtedness on the date of
such default (a "Payment Default"); or (ii) results in the acceleration of such
Indebtedness prior to its express maturity, and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any other
such Indebtedness under which there has been a Payment Default or the maturity
of which has been so accelerated, aggregates $5.0 million or more; (f) the
Company or any of its Restricted Subsidiaries fails to pay final judgments
aggregating in excess of $5.0 million, which judgments are not paid, discharged
or stayed for a period of 60 days; and (g) the Company or any of its Affiliates
breaches any representation or warranty in any material respect in the
Collateral Documents or any certificates delivered in connection therewith, the
Company or any of its Affiliates fails for 30 days (or such other period as
specifically provided therein) after notice thereof to comply with any covenant
or agreement set forth in the Collateral Documents, the Company repudiates any
of its obligations under the Collateral Documents, the Collateral Documents
become unenforceable against the Company or perfection or priority of the Liens
granted by the Company thereunder is lost for any reason; (h) certain events of
bankruptcy or insolvency occurs with respect to the Company or any of its
Restricted Subsidiaries; (i) the revocation, termination, suspension or other
cessation of effectiveness for a period of more than 90 consecutive days of any
Gaming License results in the cessation or suspension of gaming operations at
any Gaming Facility; (j) Riviera Holdings defaults in the performance of its
obligations set forth in, or repudiates its obligations under, the Completion
Capital Commitment or the Keep-Well Agreement; or (k) the Riviera Black Hawk
fails to be Operating by the Operating Deadline or fails to remain Operating
thereafter, except (a) as the hours of operation of the Riviera Black Hawk may
be limited by any Gaming Authority or Gaming Law or (b) for a period of time not
to exceed 30 days during any 45-day period and not to exceed 60 days during any
A-8
one-year period; provided, however, that, in any event, there shall not be an
Event of Default under this clause if the failure to remain Operating during
such period results from an Event of Loss pursuant to the terms of this
Indenture.
14. Trustee Dealings with Company. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if it were not the Trustee.
15. No Recourse Against Others. A director, officer, employee, incorporator
or stockholder, of the Company, as such, shall not have any liability for any
obligations of the Company under the Notes or the Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Notes.
16. Security. The due and punctual payment of the principal of, Interest
and premium, if any, and Liquidated Damages, if any, on the Notes when and as
the same shall be due and payable, whether on an Interest Payment Date, at
maturity, by acceleration, repurchase, redemption or otherwise, and Interest and
Liquidated Damages (to the extent permitted by law), if any, on the Notes and
performance of all other obligations of the Company to the Holders of Notes or
the Trustee under the Indenture and the Notes, according to the terms hereunder
or thereunder, shall be ratably secured by a Lien on the Collateral owned by the
Company, subject to Permitted Liens. Each Holder of Notes, by its acceptance
thereof, consents and agrees to the terms of the Collateral Documents
(including, without limitation, the provisions providing for foreclosure and
release of Collateral) as the same may be in effect or may be amended from time
to time in accordance with its terms and authorizes and directs the Trustee to
enter into the Collateral Documents and to perform its obligations and exercise
its rights thereunder in accordance therewith.
17. Authentication. This Note shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent.
18. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
19. Additional Rights of Holders of Restricted Global Notes and Restricted
Definitive Notes. In addition to the rights provided to Holders of Notes under
the Indenture, Holders of Restricted Global Notes and Restricted Definitive
Notes shall have all the rights set forth in the Registration Rights Agreement
dated as of June 3, 1999, between the Company and the parties named on the
signature pages thereof or, in the case of Additional Notes, Holders of
Restricted Global Notes and Restricted Definitive Notes shall have the rights
set forth in one or more registration rights agreements, if any, between the
Company and the other parties thereto, relating to the rights given by the
Company to the purchasers of any Additional Notes (collectively, the
"Registration Rights Agreement").
A-9
20. CUSIP Numbers. The Company in issuing the Notes may use a "CUSIP"
number. No representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes and that reliance may be placed
only on the other identification numbers printed on the Notes.
The Company shall furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Riviera Black Hawk, Inc.
000 Xxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxx 00000
Attention: Corporate Secretary
A-10
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
-----------------------------------
(Insert assignee's legal name)
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:
Your Signature:
-------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee:
-----------------------
A-11
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.10, 4.15, 4.28 or 4.29 of the Indenture, check the appropriate box
below:
[ ] Section 4.10 [ ] Section 4.15 [ ] Section 4.28 [ ] Section 4.29
If you want to elect to have only part of the Note purchased by the Company
pursuant to Section 4.10, 4.15, 4.28 or 4.29 of the Indenture, state the amount
you elect to have purchased:
$
----------------
Date:
--------------
Your Signature:
---------------------------
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.:
-------------------
Signature Guarantee:
-----------------
A-12
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Amount Signature of
Amount of decrease in Amount of increase in of this Global Note authorized officer of
Principal Amount of Principal Amount following such decrease Trustee or Note
Date of Exchange this Global Note of this Global Note (or increase) Custodian
---------------- ---------------------- ---------------------- ---------------------- ----------------------
* This schedule should be included only if the Note is issued in global form.
A-13
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Riviera Black Hawk, Inc.
000 Xxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: President
IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Department
Re: 13% First Mortgage Notes due 2005 With Contingent Interest
----------------------------------------------------------
Reference is hereby made to the Indenture, dated as of June 3, 1999
(the "Indenture"), between Riviera Black Hawk, Inc., as issuer (the "Company")
and IBJ Whitehall Bank & Trust Company, as trustee. Capitalized terms used but
not defined herein shall have the meanings given to them in the Indenture.
___________________ (the "Transferor") owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to ___________________________ (the "Transferee"), as further specified in Annex
A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] Check if Transferee will take delivery of a beneficial interest
in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer
is being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.
B-1
2. [ ] Check and complete if Transferee will take delivery of a
beneficial interest in a Definitive Note pursuant to any provision of the
Securities Act other than Rule 144A. The Transfer is being effected in
compliance with the transfer restrictions applicable to beneficial interests in
Restricted Global Notes and Restricted Definitive Notes and pursuant to and in
accordance with the Securities Act and any applicable blue sky securities laws
of any state of the United States, and accordingly the Transferor hereby further
certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a
subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with
the prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A or Rule 144,
and the Transferor hereby further certifies that it has not engaged in
any general solicitation within the meaning of Regulation D under the
Securities Act and the Transfer complies with the transfer restrictions
applicable to beneficial interests in a Restricted Global Note or
Restricted Definitive Notes and the requirements of the exemption
claimed, which certification is supported by (1) a certificate executed
by the Transferee in the form of Exhibit D to the Indenture and (2) if
such Transfer is in respect of a principal amount of Notes at the time
of transfer of less than $100,000, an Opinion of Counsel acceptable to
the Company provided by the Transferor or the Transferee (a copy of
which the Transferor has attached to this certification), to the effect
that such Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of
the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Definitive Notes and in the
Indenture and the Securities Act.
3. [ ] Check if Transferee will take delivery of a beneficial interest
in an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) [ ] Check if Transfer is pursuant to Rule 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any
B-2
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(b) [ ] Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144 and in
compliance with the transfer restrictions contained in the Indenture and any
applicable blue sky securities laws of any State of the United States and (ii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will not be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
-----------------------------------------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
Dated:
----------------
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP ), or
(ii) [ ] IAI Global Note (CUSIP ), or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP ), or
(ii) [ ] IAI Global Note (CUSIP ), or
(iii) [ ] Unrestricted Global Note (CUSIP ); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Riviera Black Hawk, Inc.
000 Xxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: President
IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Department
Re: 13% First Mortgage Notes due 2005 With Contingent Interest
----------------------------------------------------------
Dear Sirs:
Reference is hereby made to the Indenture, dated as of June 3, 1999
(the "Indenture"), between Riviera Black Hawk, Inc., as issuer (the "Company")
and IBJ Whitehall Bank & Trust Company, as trustee. Capitalized terms used but
not defined herein shall have the meanings given to them in the Indenture.
__________________________ (the "Owner") owns and proposes to exchange
the Note[s] or interest in such Note[s] specified herein, in the principal
amount of $____________ in such Note[s] or interests (the "Exchange"). In
connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests
in an Unrestricted Global Note
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to beneficial interest in an Unrestricted Global Note. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the United States Securities Act of
1933, as amended (the "Securities Act"), (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the beneficial
interest in an Unrestricted Global Note is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.
C-1
(b) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to Unrestricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) [ ] Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests
in Restricted Global Notes
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to Restricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
C-2
(b) [ ] Check if Exchange is from Restricted Definitive Note to
beneficial interest in a Restricted Global Note. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] [ ] 144A Global Note, [ ] IAI Global Note with an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer and (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, and in compliance with any applicable blue sky securities laws of any state
of the United States. Upon consummation of the proposed Exchange in accordance
with the terms of the Indenture, the beneficial interest issued will be subject
to the restrictions on transfer enumerated in the Private Placement Legend
printed on the relevant Restricted Global Note and in the Indenture and the
Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
-----------------------------------------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
Dated:
----------------
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Riviera Black Hawk, Inc.
000 Xxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: President
IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Department
Re: 13% First Mortgage Notes due 2005 With Contingent Interest
----------------------------------------------------------
Dear Sirs:
Reference is hereby made to the Indenture, dated as of June 3, 1999
(the "Indenture"), between Riviera Black Hawk, Inc., as issuer (the "Company")
and IBJ Whitehall Bank & Trust Company, as trustee. Capitalized terms used but
not defined herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to a person whom we reasonably believe to be a qualified
institutional buyer (as defined in Rule 144A under the Securities Act) in a
transaction meeting the requirements of Rule 144A, in a transaction meeting the
D-1
requirements of Rule 144 under the Securities Act, outside the United States in
a transaction meeting the requirements of Rule 904 under the Securities Act, or
in accordance with another exemption from the registration requirements of the
Securities Act (and based upon an opinion of counsel if the Company so
requests), (B) to the Company or (C) pursuant to an effective registration
statement, and, in each case, in accordance with any applicable securities laws
of any State of the United States or any other applicable jurisdiction, and we
further agree to provide to any person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) and (B) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
-----------------------------------------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
Dated:
----------------
EXHIBIT E
FORM OF INTERCOMPANY NOTE
$ Black Hawk, Colorado
--------------------
,
---------------- ---
For value received, the undersigned, [INSERT NAME OF SUBSIDIARY], a
("Maker"), hereby promises to pay to the order of Riviera Black
Hawk, Inc., a Colorado corporation ("Lender"), the principal amount of
$ on , , and to pay interest thereon from the date
hereof, semiannually on and of each year (each, an
"Interest Payment Date"), commencing , at the rate of % per
annum, until the principal hereof is paid or duly made available for payment.
Interest on this Note shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months. In no event shall interest be charged under
this Note which would violate any applicable law. All such payments of principal
and interest shall be payable without defense, set-off or counterclaim, in
lawful money of the United States of America, and delivered to Lender by good
and sufficient funds by wire transfer to Xxxxxx's account or by check delivered
to Xxxxxx's address or at such other place as Lender or any holder hereof shall
designate in writing for such purpose from time to time. If a payment hereunder
otherwise would become due and payable on a Saturday, Sunday or legal holiday,
the due date thereof shall be extended to the next succeeding business day.
This Note may be prepaid in whole or in part at any time. Any
prepayment shall be without penalty. Any partial principal prepayment under this
Note shall be applied against the principal due hereunder at maturity. This Note
shall be non-negotiable.
No waiver or modification of any of the terms of this Note shall be
valid or binding unless set forth in a writing specifically referring to this
Note and signed by a duly authorized officer of Lender or any holder hereof, and
then only to the extent specifically set forth therein.
If any default occurs in any payment due under this Note, Maker and all
guarantors and endorsers hereof, if any, and their successors and assigns,
promise to pay all costs and expenses, including attorneys' fees, incurred by
each holder hereof in collecting or attempting to collect the indebtedness under
this Note, whether or not any action or proceeding is commenced. None of the
provisions hereof and none of the holder's rights or remedies hereunder on
account of any past or future defaults shall be deemed to have been waived by
the holder's acceptance of any past due installments or by any indulgence
granted by the holder to Maker.
This Note shall inure to the benefit of Lender, its successors and
assigns and shall bind the heirs, executors, administrators, successors and
assigns of Maker.
E-1
In the event that any one or more provisions of this Note shall be held
to be illegal, invalid or otherwise unenforceable, the same shall not affect any
other provision of this Note and the remaining provisions of this Note shall
remain in full force and effect.
This Note shall be governed by and construed in accordance with the
internal laws of the State of Colorado.
IN WITNESS WHEREOF, Maker has caused this Note to be duly executed the
day and year first written above.
[INSERT NAME OF SUBSIDIARY]
By:
----------------------------
Name:
Title:
E-2
EXHIBIT F
FORM OF PLEDGE AGREEMENT
F-1
EXHIBIT G
FORM OF COLLATERAL ASSIGNMENT OF PATENT
G-1
EXHIBIT H
FORM OF COLLATERAL ASSIGNMENT OF COPYRIGHT
H-1
EXHIBIT I
FORM OF SUPPLEMENTAL INDENTURE
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
______________,____, among _________________________ (the "Guaranteeing
Subsidiary"), a subsidiary of Riviera Black Hawk, Inc. (or its permitted
successor), a Colorado corporation (the "Company"), the Company, the other
Persons (as defined in the Indenture referred to herein) that have previously
entered into a supplemental indenture pursuant to the terms of the Indenture
(each an "Existing Guarantor" and, together with the Guaranteeing Subsidiary,
each a "Guarantor") and IBJ Whitehall Bank & Trust Company, as trustee under the
Indenture (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of June 3, 1999, providing for
the issuance of an aggregate principal amount of $45,000,000 of 13% First
Mortgage Notes due 2005 With Contingent Interest (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations (as defined in the Indenture) under
the Notes and the Indenture on the terms and conditions set forth herein (the
"Note Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AMENDMENTS TO THE INDENTURE.1 (a) Section 1.01 of the Indenture is
hereby amended to add the following definitions:
"Guarantor" means any Restricted Subsidiary that executes a
Note Guarantee in accordance with the provisions of this Indenture, and
its respective successors and assigns.
"Note Guarantee" means the Guarantee by each Guarantor of the
Company's payment obligations under this Indenture and on the Notes,
executed pursuant to the provisions of this Indenture.
--------------------------
1 This section should be included only the first time that this supplemental
indenture is executed.
I-1
(b) The definition of "obligor" in Section 1.03 of the Indenture is
hereby amended and restated to read in its entirety as follows:
"`obligor' on the Notes and the Note Guarantees means the Company and
the Guarantors, respectively, and any successor obligor upon the Notes
and the Note Guarantees, respectively."
(c) Section 4.03(b) of the Indenture is hereby amended to include the
words "and the Guarantors" after the first time the words "the Company"
appear in such section.
(d) Section 4.04(a) of the Indenture is hereby amended to include the
words "and each Guarantor (to the extent that such Guarantor is so required
under the TIA)" after first time the words "the Company" appear in such
section.
(e) Section 4.06 of the Indenture is hereby amended to include the
words "and each of the Guarantors" after each time the words "the Company"
appear in such section.
(f) Section 6.01 of the Indenture is hereby amended to add the
following provision:
"(n) except as permitted by this Indenture, any Note Guarantee is held
in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Guarantor,
or any Person acting on behalf of any Guarantor, shall deny or
disaffirm its obligations under such Guarantor's Note Guarantee."
(g) The first clause of Section 9.01 is hereby amended and restated to
read in its entirety as follows:
"Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the
Note Guarantees or the Notes without the consent of any Holder of a
Note:"
(h) Section 9.01(c) is hereby amended and restated to read in its
entirety as follows:
(c) to provide for the assumption of the Company's or a Guarantor's
obligations to the Holders of the Notes by a successor to the Company
pursuant to Article 5 or Article 12 hereof;"
(i) The last paragraph of Section 9.01 is hereby amended to include the
words "and the Guarantors" after second time the words "the Company" appear
in such paragraph.
(j) Section 9.02 of the Indenture is hereby amended to (i) include the
phrase ", the Note Guarantees" after the first parenthetical appearing in
such section and after the second time that the word "Indenture" appears in
such section and (ii) add the following clause at the end of the section:
"(h) release any Guarantor from any of its obligations under its Note
Guarantee or this Indenture, except in accordance with the terms of
this Indenture."
I-2
(k) Section 11.02 of the Indenture is hereby amended to provide that
any notices to be given to a Guarantor pursuant to the Indenture shall be
given at the address of the Company and in the manner that notices are given
to the Company.
(l) Section 11.10 of the Indenture is hereby amended to add the
following"
"All agreements of each Guarantor in this Indenture shall bind its
successors, except as otherwise provided in Section 12.05."
(m) Section 10.01 is hereby amended and restated to read in its
entirety as follows:
"Section 10.01. Security
The due and punctual payment of the principal of and Interest and
premium, if any, and Liquidated Damages, if any, on the Notes when and
as the same shall be due and payable, whether on an Interest Payment
Date, at maturity, by acceleration, repurchase, redemption or
otherwise, and Interest on the overdue principal of and Interest and
Liquidated Damages (to the extent permitted by law), if any, on the
Notes and performance of all other obligations of the Company and the
Guarantors to the Holders of Notes or the Trustee under this Indenture
and the Notes and the Note Guarantees, according to the terms hereunder
or thereunder, shall be ratably secured by a Lien on the Collateral
owned by the Company and each Note Guarantee similarly shall be secured
as provided in the Collateral Documents. Each Holder of Notes, by its
acceptance thereof, consents and agrees to the terms of the Collateral
Documents (including, without limitation, the provisions providing for
foreclosure and release of Collateral) as the same may be in effect or
may be amended from time to time in accordance with its terms and
authorizes and directs the Trustee to enter into the Collateral
Documents and to perform its obligations and exercise its rights
thereunder in accordance therewith. The Company and the Guarantors
shall deliver to the Trustee copies of all documents executed pursuant
to this Indenture and the Collateral Documents, and shall do or cause
to be done all such acts and things as may be necessary or proper, or
as may be required by the provisions of the Collateral Documents, to
assure and confirm to the Trustee the security interest in the
Collateral contemplated hereby, as from time to time constituted, so as
to render the same available for the security and benefit of this
Indenture and of the Notes and the Note Guarantees secured hereby,
according to the intent and purposes herein expressed. The Company
shall take, or shall cause its Subsidiaries to take, upon request of
the Trustee, any and all actions reasonably required to create and
maintain, as security for the Obligations of the Company hereunder, a
valid and enforceable perfected first priority Lien in and on all the
Collateral, in favor of the Trustee for the benefit of the Holders of
Notes, superior to and prior to the rights of all third Persons and
subject to no other Liens than Permitted Liens, including executing, as
applicable, a Pledge Agreement in the form attached hereto as Exhibit
F, a Collateral Assignment of Patent in the form attached hereto as
Exhibit G and a Collateral Assignment of Copyright in the form attached
hereto as Exhibit H."
(n) Section 10.02(a) of the Indenture is hereby amended to add the
words "and the Guarantors" after the first time that the words "the
Company" appear in such section and to add the words "and the Note
Guarantees" after the first time the words "the Notes" appear in such
section.
I-3
(o) Section 10.02(b) of the Indenture is hereby amended to add the
words "and the Guarantors" after the first time that the words "the
Company" appear in such section.
(p) Section 10.09 of the Indenture is hereby amended to add the words
"or any Guarantor" after the first and third times the words "the
Company" appear in such section and the words "or such Guarantor" after
the second and fourth times the words "the Company" appear in such
section
(m) The Indenture is hereby amended to add the following provisions:
"Section 12.01. Guarantee. Subject to this Article 12, each of the
Guarantors hereby, jointly and severally, unconditionally guarantees to each
Holder of a Note authenticated and delivered by the Trustee and to the Trustee
and its successors and assigns, irrespective of the validity and enforceability
of this Indenture, the Notes or the obligations of the Company hereunder or
thereunder, that: (a) the principal of and Interest on the Notes will be
promptly paid in full when due, whether at maturity, by acceleration, redemption
or otherwise, and interest on the overdue principal of and Interest on the
Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed or any performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay the same immediately.
Each Guarantor agrees that this is a guarantee of payment and not a guarantee of
collection.
The Guarantors hereby agree that their obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Notes or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Note Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and this Indenture.
If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Note
I-4
Guarantee, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and (y) in
the event of any declaration of acceleration of such obligations as provided in
Article 6 hereof, such obligations (whether or not due and payable) shall
forthwith become due and payable by the Guarantors for the purpose of this Note
Guarantee. The Guarantors shall have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not impair the
rights of the Holders under the Guarantee.
Section 12.02. Limitation on Guarantor Liability. Each Guarantor, and
by its acceptance of Notes, each Holder, hereby confirms that it is the
intention of all such parties that the Note Guarantee of such Guarantor not
constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law,
the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or
any similar federal or state law to the extent applicable to any Note Guarantee.
To effectuate the foregoing intention, the Trustee, the Holders and the
Guarantors hereby irrevocably agree that the obligations of such Guarantor will,
after giving effect to such maximum amount and all other contingent and fixed
liabilities of such Guarantor that are relevant under such laws, and after
giving effect to any collections from, rights to receive contribution from or
payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under this Article 12, result in the
obligations of such Guarantor under its Note Guarantee not constituting a
fraudulent transfer or conveyance.
Section 12.03. Execution and Delivery of Note Guarantee. To evidence
its Note Guarantee set forth in Section 12.01, each Guarantor hereby agrees that
a notation of such Note Guarantee shall be endorsed by an Officer of such
Guarantor on each Note authenticated and delivered by the Trustee substantially
in the following form:
"For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of June 3, 1999 (the "Indenture")
among Riviera Black Hawk, Inc., a Colorado corporation, the Guarantors
listed on Schedule I thereto and IBJ Whitehall Bank & Trust Company, as
trustee (the "Trustee"), (a) the due and punctual payment of the
principal of, premium, if any, and Interest on the Notes (as defined in
the Indenture), whether at maturity, by acceleration, redemption or
otherwise, the due and punctual payment of interest on overdue
principal and premium, and, to the extent permitted by law, Interest,
and the due and punctual performance of all other obligations of the
Company to the Holders or the Trustee all in accordance with the terms
of the Indenture and (b) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that the same
will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise. The obligations of the Guarantors to the
Holders of Notes and to the Trustee pursuant to the Note Guarantee and
the Indenture are expressly set forth in Article 12 of the Indenture
and reference is hereby made to the Indenture for the precise terms of
the Note Guarantee. Each Holder of a Note, by accepting the same, (a)
agrees to and shall be bound by such provisions and (b) appoints the
Trustee attorney-in-fact of such Holder for such purpose.
I-5
[NAME OF XXXXXXXXX(S)]
By:
-------------------------------
Name:
Title:"
Each Guarantor hereby agrees that its Note Guarantee set forth in
Section 12.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Note Guarantee.
If an Officer whose signature is on this Indenture or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Note Guarantee is endorsed, the Note Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Note Guarantee set forth
in this Indenture on behalf of the Guarantors.
Section 12.04. Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 12.05, no Guarantor may consolidate with
or merge with or into (whether or not such Guarantor is the surviving Person)
another Person whether or not affiliated with such Guarantor unless:
(a) subject to Section 12.05 hereof, the Person formed by or surviving
any such consolidation or merger (if other than a Guarantor or the Company)
unconditionally assumes all the obligations of such Guarantor, pursuant to a
supplemental indenture in form and substance reasonably satisfactory to the
Trustee, under the Notes, the Indenture and the Note Guarantee on the terms set
forth herein or therein; and
(b) immediately after giving effect to such transaction, no Default or
Event of Default exists.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by the Guarantor,
such successor Person shall succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Note Guarantees theretofore and thereafter issued in
accordance with the terms of this Indenture as though all of such Note
Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 of the Indenture, and
notwithstanding clauses (a) and (b) above, nothing contained in this Indenture
or in any of the Notes shall prevent any consolidation or merger of a Guarantor
with or into the Company or another Guarantor, or shall
I-6
prevent any sale or conveyance of the property of a Guarantor as an entirety or
substantially as an entirety to the Company or another Guarantor.
Section 12.05. Releases Following Sale of Assets. In the event of a
sale or other disposition of all of the assets of any Guarantor, by way of
merger, consolidation or otherwise, or a sale or other disposition of all to the
capital stock of any Guarantor, in each case to a Person that is not (either
before or after giving effect to such transactions) a Restricted Subsidiary of
the Company, then such Guarantor (in the event of a sale or other disposition,
by way of merger, consolidation or otherwise, of all of the capital stock of
such Guarantor) or the corporation acquiring the property (in the event of a
sale or other disposition of all or substantially all of the assets of such
Guarantor) will be released and relieved of any obligations under its Note
Guarantee; provided that the Net Proceeds of such sale or other disposition are
applied in accordance with the applicable provisions of this Indenture,
including without limitation Section 4.10 hereof. Upon delivery by the Company
to the Trustee of an Officers' Certificate and an Opinion of Counsel to the
effect that such sale or other disposition was made by the Company in accordance
with the provisions of this Indenture, including without limitation Section 4.10
hereof, the Trustee shall execute any documents reasonably required in order to
evidence the release of any Guarantor from its obligations under its Note
Guarantee.
Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and Interest
on the Notes and for the other obligations of any Guarantor under this Indenture
as provided in this Article 12."
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees as
follows:
(a) Along with all other Guarantors, to jointly and severally Guarantee
to each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns, the Notes or the obligations of the
Company hereunder or thereunder, that:
(i) the principal of and Interest on the Notes will be promptly paid in
full when due, whether at maturity, by acceleration, redemption or
otherwise, and interest on the overdue principal of and Interest on the
Notes, if any, if lawful, and all other obligations of the Company to
the Holders or the Trustee hereunder or thereunder will be promptly
paid in full or performed, all in accordance with the terms hereof and
thereof; and
(ii) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that same will be promptly paid
in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or
otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors shall be
jointly and severally obligated to pay the same immediately.
(b) The obligations hereunder shall be unconditional, irrespective of
the validity, regularity or enforceability of the Notes or the Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
of the Notes with respect
I-7
to any provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a guarantor.
(c) The following is hereby waived: diligence presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Company, any right to require a proceeding first against the Company,
protest, notice and all demands whatsoever.
(d) This Note Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and the Indenture, and the
Guaranteeing Subsidiary accepts all obligations of a Guarantor under the
Indenture.
(e) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Guarantors, or any Custodian, Trustee, liquidator
or other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the Holders and the
Trustee, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article 6 of the Indenture for the
purposes of this Note Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (y) in the event of any declaration of acceleration of
such obligations as provided in Article 6 of the Indenture, such obligations
(whether or not due and payable) shall forthwith become due and payable by the
Guarantors for the purpose of this Note Guarantee.
(h) The Guarantors shall have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not impair the
rights of the Holders under the Guarantee.
(i) Pursuant to Section 12.02 of the Indenture, as amended to date,
after giving effect to any maximum amount and any other contingent and fixed
liabilities that are relevant under any applicable Bankruptcy or fraudulent
conveyance laws, and after giving effect to any collections from, rights to
receive contribution from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under Article 10
of the Indenture, this new Note Guarantee shall be limited to the maximum amount
permissible such that the obligations of such Guarantor under this Note
Guarantee will not constitute a fraudulent transfer or conveyance.
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3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the
Note Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.
(a) The Guaranteeing Subsidiary may not consolidate with or merge with
or into (whether or not such Guarantor is the surviving Person) another
corporation, Person or entity whether or not affiliated with such Guarantor
unless:
(i) subject to Sections 12.04 and 12.05 of the Indenture, as
amended to date, the Person formed by or surviving any such
consolidation or merger (if other than a Guarantor or the Company)
unconditionally assumes all the obligations of such Guarantor, pursuant
to a supplemental indenture in form and substance reasonably
satisfactory to the Trustee, under the Notes, the Indenture and the
Note Guarantee on the terms set forth herein or therein; and
(ii) immediately after giving effect to such transaction, no
Default or Event of Default exists.
(b) In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor corporation, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the Note Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of the Indenture to be
performed by the Guarantor, such successor corporation shall succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor corporation thereupon may cause to be
signed any or all of the Note Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee. All the Note Guarantees so issued shall in all
respects have the same legal rank and benefit under the Indenture as the Note
Guarantees theretofore and thereafter issued in accordance with the terms of the
Indenture as though all of such Note Guarantees had been issued at the date of
the execution hereof.
(c) Except as set forth in Articles 4 and 5 and Section 12.05 of the
Indenture, as amended to date, and notwithstanding clauses (a) and (b) above,
nothing contained in the Indenture or in any of the Notes shall prevent any
consolidation or merger of a Guarantor with or into the Company or another
Guarantor, or shall prevent any sale or conveyance of the property of a
Guarantor as an entirety or substantially as an entirety to the Company or
another Guarantor.
5. RELEASES.
(a) In the event of a sale or other disposition of all of the assets of
any Guarantor, by way of merger, consolidation or otherwise, or a sale or other
disposition of all to the capital stock of any Guarantor, in each case to a
Person that is not (either before or after giving effect to such transaction) a
Restricted Subsidiary of the Company, then such Guarantor (in the event of a
sale or other disposition, by way of merger, consolidation or otherwise, of all
of the capital stock of such Guarantor) or the corporation acquiring the
property (in the event of a sale or other disposition of all or substantially
all of the assets of such Guarantor) will be released and relieved of any
obligations under its Note Guarantee; provided that the Net Proceeds of such
sale or other disposition are applied in accordance with the applicable
provisions
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of the Indenture, including without limitation Section 4.10 of the Indenture.
Upon delivery by the Company to the Trustee of an Officers' Certificate and an
Opinion of Counsel to the effect that such sale or other disposition was made by
the Company in accordance with the provisions of the Indenture, including
without limitation Section 4.10 of the Indenture, the Trustee shall execute any
documents reasonably required in order to evidence the release of any Guarantor
from its obligations under its Note Guarantee.
(b) Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under the Indenture
as provided in Article 12 of the Indenture, as amended to date.
6. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the Company
or any Guaranteeing Subsidiary under the Notes, any Note Guarantees, the
Collateral Documents, the Indenture or this Supplemental Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of the Notes by accepting a Note waives and releases all
such liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive liabilities
under the federal securities laws and it is the view of the SEC that such a
waiver is against public policy.
7. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
8. COUNTERPARTS The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
9. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiary and the Company.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated:
-----------------, -----
[GUARANTEEING SUBSIDIARY]
By:
-------------------------------
Name:
Title:
[COMPANY]
By:
--------------------------------
Name:
Title:
[EXISTING GUARANTORS]
By:
------------------------------
Name:
Title:
[TRUSTEE],
as Trustee
By:
-------------------------------
Authorized Signatory
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Schedule I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture as of
the Issue Date:
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