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EXHIBIT 4.6
EXECUTION COPY
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT ("Agreement") is made as of May 22, 1996 by The
Majestic Star Casino, LLC, an Indiana limited liability company ("Pledgor")
and a member of Buffington Harbor Riverboats, L.L.C., a Delaware limited
liability company (the "BHR Joint Venture"), and IBJ Schroder Bank & Trust
Company (the "Trustee"), for its benefit and the benefit of the "Holders"
(as such term is defined in the "Indenture" defined below). Capitalized
terms used herein and not herein defined shall have the same meanings
assigned to such terms in the Indenture described below.
W I T N E S S E T H:
WHEREAS, Pledgor and the Trustee have entered into the Indenture dated
as of May 22, 1996 (as amended, restated, supplemented or modified from time
to time, the "Indenture"), pursuant to which Pledgor and the Trustee have
agreed to certain terms for the benefit of Pledgor and the Holders;
WHEREAS, it is a condition precedent to the Indenture that this
Agreement shall be executed and delivered by the Pledgor to the Trustee and
that this Agreement shall be in full force and effect; and
WHEREAS, the Pledgor desires to secure its "Liabilities" (as
hereinafter defined) to the Holders by the grant to the Trustee on behalf of
the Holders of a first priority security interest in the "Pledged
Collateral" (as hereinafter defined);
NOW, THEREFORE, for and in consideration of the foregoing and of any
financial accommodations or extensions of credit (including, without
limitation, the purchase of the "Notes" (as defined in the Indenture) by the
Holders) heretofore, now or hereafter made to or for the benefit of Pledgor
pursuant to the Indenture or any other agreement, instrument or document
executed pursuant to or in connection therewith, and for other good and
valuable consideration, the
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receipt and sufficiency of which are hereby acknowledged, the Pledgor and the
Trustee hereby agree as follows:
1. Pledge. The Pledgor hereby pledges, grants and assigns to the
Trustee, for the equal and ratable benefit of the Holders, and grants to the
Trustee for the equal and ratable benefit of the Holders, a security
interest in, the following (collectively, the "Pledged Collateral"):
(a) (i) The membership interest of Pledgor in the BHR Joint
Venture now or at any time or times hereafter owned by the Pledgor,
and any certificates representing such membership interest in the BHR
Joint Venture (such membership interest being identified on Exhibit A
attached hereto and made a part hereof), (ii) all of the right, title
and interest of the Pledgor in, to and under its respective percentage
interest, shares or units as a member including, without limitation,
Pledgor's interest in (or allocation of) the profits, losses, income,
gains, deductions, credits or similar items of the BHR Joint Venture
and the right to receive distributions of the BHR Joint Venture's
cash, other property, assets, and all options and warrants for the
purchase of membership interests, whether now existing or hereafter
arising, whether arising under the terms of the Certificate of
Formation, the Operating Agreement (as amended, supplemented, or
modified from time to time) or any of the other organizational
documents (such documents hereinafter collectively referred to as the
"Operating Agreements") of the BHR Joint Venture, or at law or in
equity, or otherwise and (iii) any and all of the proceeds thereof
(all of said membership interest, certificates, and warrants being
hereinafter collectively referred to as the "Pledged Membership
Interest") herewith delivered to the Trustee accompanied by the
certificates or other writings evidencing the same, accompanied by
duly executed instruments of transfer or assignments in blank, all in
form and substance satisfactory to the Trustee (such instruments being
collectively referred to hereinafter as the "Powers") duly executed in
blank, and all distributions, cash, instruments and other property
from time to time received, receivable or otherwise distributed in
respect of, or in exchange for, any or all of the Pledged Membership
Interest;
(b) Any additional membership interests in the BHR Joint Venture
from time to time acquired by the Pledgor in any manner, and any
certificates representing such
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additional membership interests or any additional percentage
interests, shares, units, options or warrants of membership interests in
the BHR Joint Venture (any such additional interests shall constitute
part of the Pledged Membership Interest and the Trustee is irrevocably
authorized to amend Exhibit A from time to time to reflect such
additional shares), and all options, warrants, distributions, cash,
instruments and other rights and options from time to time received,
receivable or otherwise distributed in respect of or in exchange for any
or all of such shares and will promptly thereafter deliver to the
Trustee, a certificate duly executed by the Pledgor describing such
percentage interests, certificates, units, options or warrants and
certifying that the same have been duly pledged hereunder;
(c) The property and interests in property described in Section
3 below; and
(d) All proceeds of the foregoing.
2. Security for Liabilities. The Pledged Collateral secures the
prompt payment, performance and observance of (i) the Obligations under the
Indenture (hereinafter referred to as the "Secured Obligations") and (ii)
the Pledgor's obligations and liabilities under this Agreement and each
agreement, document or instrument executed pursuant to or in connection with
this Agreement (all such obligations and liabilities of the Pledgor now or
hereafter existing being hereinafter referred to as the "Liabilities").
3. Pledged Collateral Adjustments. If, during the term of this
Agreement:
(a) Any reclassification, readjustment or other change is
declared or made in the capital structure of the BHR Joint Venture, or
any option included within the Pledged Collateral is exercised, or
both, or
(b) Any subscription, warrants or any other rights or options
shall be issued in connection with the Pledged Collateral,
then all new, substituted and additional membership interests, certificates,
warrants, rights, options or other securities, issued by reason of any of
the foregoing, shall be immediately delivered to and held by the Trustee
under the terms of this Agreement and shall constitute Pledged Collateral
hereunder;
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provided, however, that nothing contained in this Section 3 shall be
deemed to permit any distribution, issuance of additional membership
interests, warrants, rights or options, reclassification, readjustment or
other change in the capital structure of the BHR Joint Venture which is not
expressly permitted in the Indenture.
4. Subsequent Changes Affecting Pledged Collateral. The Pledgor
represents and warrants that it has made its own arrangements for keeping
itself informed of changes or potential changes affecting the Pledged
Collateral (including, but not limited to, rights to convert, rights to
subscribe, cash distributions or other distributions, reorganization or
other exchanges, tender offers and voting rights), and the Pledgor agrees
that neither the Trustee nor any of the Holders shall have any obligation to
inform the Pledgor of any such changes or potential changes or to take any
action or omit to take any action with respect thereto. The Trustee may,
after the occurrence of an Event of Default, without notice and at its
option, transfer or register the Pledged Collateral or any part thereof into
its or its nominee's name with or without any indication that such Pledged
Collateral is subject to the security interest hereunder. In addition, the
Trustee may at any time exchange certificates or instruments representing or
evidencing Pledged Membership Interests for certificates or instruments of
smaller or larger denominations.
5. Representations and Warranties. The Pledgor represents and
warrants as follows:
(a) The Pledgor is the sole legal and beneficial owner of the
membership interests in the BHR Joint Venture pledged to the Trustee
pursuant to this Agreement, free and clear of any Lien except for the
security interest created by this Agreement;
(b) This Agreement has been duly and validly authorized,
executed and delivered by Pledgor and constitutes the legal, valid
and binding obligation of the Pledgor enforceable against the Pledgor in
accordance with its terms except as enforcement may be limited by
bankruptcy, insolvency and other similar laws affecting the enforcement
of creditors' rights generally and by moratorium laws from time to time
in effect and general equitable principles;
(c) Such Pledgor is the direct beneficial owner of the Pledged
Collateral hereby pledged by it;
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(d) The Pledgor owns such Pledged Collateral free and clear of
any pledge, mortgage, hypothecation, lien, charge, encumbrance or any
security interest therein, except for the pledge and security interest
granted to the Trustee and the Holders hereunder and any rights of the
other members as set forth in the BHR Joint Venture Articles of
Organization and Operating Agreement (together, the "Organizational
Documents");
(e) The Pledgor shall cause the BHR Joint Venture to make a
notation on its records, which notation shall indicate the security
interest granted hereby, and such Pledgor agrees to (i) execute and
file financing statements pursuant to the Uniform Commercial Code and
continuation statements as may be required to perfect the security
interest granted hereby; (ii) execute and deliver to the BHR Joint
Venture a Pledge Instruction in the form of Exhibit B hereto; and
(iii) promptly execute and deliver to Trump Indiana, Inc. a Pledge
Notice in the form of Exhibit C hereto.
(f) The pledge of the Pledged Collateral hereby pledged by such
Pledgor does not violate (1) the Operating Agreements of the BHR Joint
Venture or any of the other organizational documents of the BHR Joint
Venture, or any indenture, mortgage, bank loan or credit agreement to
which such Pledgor or the BHR Joint Venture is a party or by which any
of their respective properties or assets may be bound; or (2) any
restriction on such transfer or encumbrance of such Pledged
Collateral;
(g) There are no restrictions upon the voting rights associated
with, or upon the transfer of, any of the Pledged Collateral
except as set forth in the Organizational Documents;
(h) The Pledgor has the right to vote, pledge, assign and grant
a security interest in or otherwise transfer such Pledged Collateral
free of any Liens;
(i) No authorization, approval, or other action by, and no
notice to or filing with, any Governmental Authority (as defined in
the Security Agreement) is required either (i) for the pledge of the
Pledged Collateral pursuant to this Agreement or for the execution,
delivery or performance of this Agreement by the Pledgor or (ii) for
the exercise by the Trustee of the voting or other rights provided for
in this Agreement or the remedies in respect
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of the Pledged Collateral pursuant to this Agreement (except as
may be required in connection with such disposition by laws affecting
the offering and sale of securities generally);
(j) The pledge of the Pledged Collateral pursuant to this
Agreement creates a valid and, upon filing of the financing statements
referred to herein, a perfected security interest in the Pledged
Collateral, in favor of the Trustee for the benefit of the Trustee and
the Holders, securing the payment and performance of the Liabilities;
6. Voting Rights and Other Powers. During the term of this Agreement,
and except as provided in this Section 6 below and the Organizational
Documents, the Pledgor shall have (i) the right to vote the Pledged
Membership Interest on all questions in a manner not inconsistent with the
terms of this Agreement, the Indenture and any other agreement, instrument
or document executed pursuant thereto or in connection therewith, and (ii)
the right to be the member and manager of the BHR Joint Venture, and shall
be entitled to exercise all managerial, election and other rights relating
to the Pledged Collateral. After the occurrence and during the continuance
of an Event of Default, the Trustee or the Trustee's nominee may, at the
Trustee's or such nominee's option and following written notice ("Election
Notice") from the Trustee to the Pledgor (x) exercise, or direct such
Pledgor as to the exercise of (whereupon such Pledgor shall exercise as so
directed) all voting, consent, managerial, election and other membership and
manager rights to the Pledged Collateral of the Pledgor; such authorization
shall constitute an irrevocable voting proxy from the Pledgor to the
Trustee or, at the Trustee's option, to the Trustee's nominee; and (y)
exercise, or direct such Pledgor as to the exercise of (whereupon the Pledgor
shall exercise as so directed) any and all rights of conversion, exchange,
subscription or any other rights, privileges or options pertaining to the
Pledged Collateral of the Pledgor as if the Trustee were the absolute owner
thereof, all without liability except to account for property actually
received by it, but the Trustee shall have no duty to exercise any of the
aforesaid rights, privileges or options and shall not be responsible for any
failure so to do or delay in so doing. Under no circumstances shall the
Trustee have, or be deemed to have or to have had, any right to exercise, or
to direct the Pledgor to exercise, any voting, managerial, election or other
rights of an owner of the Pledged Collateral, or arising under the Pledged
Collateral, unless and until the Trustee shall have delivered to such Pledgor
an Election Notice as described hereinabove.
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7. Cash and Other Distributions. (a) So long as no Event of
Default shall have occurred and be continuing:
(i) The Pledgor shall be entitled to receive and retain any and
all cash distributions and interest paid in respect of the Pledged
Collateral (including a distribution of net cash flow) to the extent
such distributions are not prohibited by the Indenture, provided,
however, that any and all
(A) distributions and interest paid or payable other than
in cash with respect to, and instruments and other property
received, receivable or otherwise distributed with respect to,
or in exchange for, any of the Pledged Collateral;
(B) other distributions paid or payable in cash with
respect to any of the Pledged Collateral on account of a
partial or total liquidation or dissolution;
(C) cash paid, payable or otherwise distributed with
respect to principal of, or in redemption of, or in exchange
for, any of the Pledged Collateral; and
(D) other distributions paid or payable in cash in
connection with a reduction of capital, capital surplus or
paid-in surplus attributable to a capital contribution made
from a Cash Collateral Account
shall be Pledged Collateral, and shall be forthwith delivered to the
Trustee to hold, for the benefit of the Trustee and the Holders, as
Pledged Collateral and shall, if received by the Pledgor, be received
in trust for the Trustee, for the benefit of the Trustee and the
Holders, be segregated from the other property or funds of the
Pledgor, and be delivered immediately to the Trustee as Pledged
Collateral in the same form as so received (with any necessary
endorsement); and
(ii) The Trustee shall execute and deliver (or cause to be
executed and delivered) to the Pledgor all such proxies and other
instruments as the Pledgor may reasonably request for the purpose of
enabling the Pledgor to receive the distributions or interest payments
which it is authorized to receive and retain pursuant to clause (i)
above.
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(b) After the occurrence and during the continuance of an Event of Default:
(i) All rights of the Pledgor to receive the distributions and
interest payments which it would otherwise be authorized to receive
and retain pursuant to Section 7(a)(i) hereof shall cease, and all
such rights shall thereupon become vested in the Trustee, for the
benefit of the Trustee and the Holders, which shall thereupon have the
sole right to receive and hold as Pledged Collateral such
distributions and interest payments;
(ii) All distributions and interest payments which are received
by the Pledgor contrary to the provisions of clause (i) of this
Section 7(b) shall be received in trust for the Trustee, for the
benefit of the Trustee and the Holders, shall be segregated from other
funds of the Pledgor and shall be paid over immediately to the Trustee
as Pledged Collateral in the same form as so received (with any
necessary endorsements).
8. Transfers and Other Liens. The Pledgor agrees that it will not (a)
sell or otherwise dispose of, or grant any option with respect to, any of
the Pledged Collateral without the prior written consent of the Trustee, or
(b) create or permit to exist any Lien upon or with respect to any of the
Pledged Collateral, except for the security interest under this Agreement.
To the extent additional or different members of the BHR Joint Venture are
permitted, Pledgor shall use its best efforts to cause such member to
consent to (i) the terms of this Agreement; (ii) the Pledge and assignment
of the Pledged Collateral; and (iii) the rights granted hereunder for the
Trustee to become the/a member of the BHR Joint Venture at its election.
9. Remedies. (a) The Trustee shall have, in addition to any other
rights given under this Agreement or by law, all of the rights and remedies
with respect to the Pledged Collateral of a secured party under the Uniform
Commercial Code as in effect in the State of Indiana. After the occurrence
and during the continuance of an Event of Default and following written
notice to the Pledgor, the Trustee (personally or through an agent) is
hereby authorized and empowered to transfer and register in its name or in
the name of its nominee the whole or any part of the Pledged Collateral, to
exercise all voting rights with respect thereto, to collect and receive all
cash distributions and other distributions made thereon, and to
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otherwise act with respect to the Pledged Collateral as though the
Trustee were the outright owner thereof and the sole member and manager of the
BHR Joint Venture, the Pledgor hereby irrevocably constituting and appointing
the Trustee as the proxy and attorney-in-fact of the Pledgor, with full power
of substitution to do so, such proxy becoming effective upon the occurrence of
an Event of Default and following written notice thereof; provided, however,
that the Trustee shall have no duty to exercise any such right or to preserve
the same and shall not be liable for any failure to do so or for any delay in
doing so. In addition, after the occurrence of an Event of Default, the
Trustee shall have such powers of sale and other powers as may be conferred by
applicable law. With respect to the Pledged Collateral or any part thereof
which shall then be in or shall thereafter come into the possession or custody
of the Trustee or which the Trustee shall otherwise have the ability to
transfer under applicable law, the Trustee may, in its sole discretion,
without notice except as specified below, after the occurrence of an Event of
Default, sell or cause the same to be sold at any exchange, broker's board
or at public or private sale, in one or more sales or lots, at such price as
the Trustee may deem best, for cash or on credit or for future delivery,
without assumption of any credit risk, and the purchaser of any or all of
the Pledged Collateral so sold shall thereafter own the same, absolutely
free from any claim, encumbrance or right of any kind whatsoever. The
Trustee and each of the Holders may, in its own name, or in the name of a
designee or nominee, buy the Pledged Collateral at any public sale and, if
permitted by applicable law, buy the Pledged Collateral at any private sale.
The Pledgor will pay to the Trustee all reasonable expenses (including,
without limitation, court costs and reasonable attorneys' and paralegals'
fees and expenses) of, or incidental to, the enforcement of any of the
provisions hereof. The Trustee agrees to distribute any proceeds of the
sale of the Pledged Collateral in accordance with the Indenture and the
Pledgor shall remain liable for any deficiency following the sale of the
Pledged Collateral.
(b) Unless any of the Pledged Collateral threatens to decline speedily
in value or is or becomes of a type sold on a recognized market, the Trustee
will give the Pledgor reasonable notice of the time and place of any public
sale thereof, or of the time after which any private sale or other intended
disposition is to be made. Any sale of the Pledged Collateral conducted in
conformity with reasonable commercial practices of banks, commercial finance
companies, insurance companies or other financial institutions disposing of
property similar to the Pledged Collateral shall be deemed to be
commercially
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reasonable. Notwithstanding any provision to the contrary contained herein,
the Pledgor agrees that any requirements of reasonable notice shall be met if
such notice is received by the Pledgor as provided in Section 25 below at
least five (5) Business Days before the time of the sale or disposition;
provided, however, that Trustee may give any shorter notice that is
commercially reasonable under the circumstances. Any other requirement of
notice, demand or advertisement for sale is waived, to the extent permitted by
law.
(c) In view of the fact that federal and state securities laws may
impose certain restrictions on the method by which a sale of the Pledged
Collateral may be effected after an Event of Default, the Pledgor agrees
that after the occurrence of an Event of Default, the Trustee may, from time
to time, attempt to sell all or any part of the Pledged Collateral by means
of a private placement restricting the bidders and prospective purchasers to
those who are qualified and will represent and agree that they are purchasing
for investment only and not for distribution. In so doing, the Trustee may
solicit offers to buy the Pledged Collateral, or any part of it, from a
limited number of investors deemed by the Trustee, in its reasonable judgment,
to be financially responsible parties who might be interested in purchasing
the Pledged Collateral. If the Trustee solicits such offers from not less
than four (4) such investors, then the acceptance by the Trustee of the
highest offer obtained therefrom shall be deemed to be a commercially
reasonable method of disposing of such Pledged Collateral; provided, however,
that this Section does not impose a requirement that the Trustee solicit
offers from four or more investors in order for the sale to be commercially
reasonable.
10. Security Interest Absolute. All rights of the Trustee and
security interests hereunder, and all obligations of the Pledgor hereunder,
shall be absolute and unconditional irrespective of:
(i) Any lack of validity or enforceability of the Indenture or
any other agreement or instrument relating thereto;
(ii) Any change in the time, manner or place of payment of, or
in any other term of, all or any part of the Liabilities, or any other
amendment or waiver of or any consent to any departure from the
Indenture;
(iii) Any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of
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or consent to departure from any guaranty, for all or any part of the
Liabilities; or
(iv) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Pledgor in respect of the
Liabilities or of this Agreement.
11. Trustee Appointed Attorney-in-Fact. The Pledgor hereby appoints
the Trustee its attorney-in-fact, with full authority, in the name of the
Pledgor or otherwise, after the occurrence and during the continuance of an
Event of Default, from time to time in the Trustee's sole discretion, to
take any action and to execute any instrument which the Trustee may deem
necessary or advisable to accomplish the purposes of this Agreement,
including, without limitation, to receive, endorse and collect all instruments
made payable to the Pledgor representing any cash distribution, interest
payment or other distribution in respect of the Pledged Collateral or any part
thereof and to give full discharge for the same, to exercise all rights of a
member and manager (upon the election of the Trustee) such as all voting,
consent, managerial and other member rights, and to arrange for the transfer
of all or any part of the Pledged Collateral on the books of the BHR Joint
Venture to the name of the Trustee or the Trustee's nominee.
12. Waivers. The Pledgor waives presentment and demand for payment of
any of the Liabilities, protest and notice of dishonor or default with
respect to any of the Liabilities and all other notices to which the Pledgor
might otherwise be entitled except as otherwise expressly provided herein or
in the Indenture.
13. Term. This Agreement shall remain in full force and effect until
the Liabilities (other than continuing indemnity obligations) have been
fully and indefeasibly paid in cash and the Indenture has terminated
pursuant to its terms. Upon the termination of this Agreement as provided
above (other than as a result of the sale of the Pledged Collateral), the
Trustee will release the security interest created hereunder and, if it then
has possession of the Pledged Membership Interest, will deliver the Pledged
Membership Interest and the Powers to the Pledgor.
14. Definitions. The singular shall include the plural and vice versa
and any gender shall include any other gender as the context may require.
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15. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the Pledgor, the Trustee, for the benefit of itself
and the Holders, and their respective successors and assigns. The Pledgor's
successors and assigns shall include, without limitation, a receiver,
trustee or debtor-in-possession of or for the Pledgor.
16. GOVERNING LAW. ANY DISPUTE BETWEEN THE TRUSTEE AND THE PLEDGOR
ARISING OUT OF OR RELATED TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH THIS AGREEMENT, AND WHETHER ARISING IN CONTRACT, TORT,
EQUITY, OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS,
AND NOT THE CONFLICTS OF LAW PROVISIONS, OF THE STATE OF INDIANA.
17. Consent to Jurisdiction; Counterclaims; Forum Non Conveniens. (A)
NON-EXCLUSIVE JURISDICTION. THE PLEDGOR HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE
COURT SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT AND THE PLEDGOR HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW
OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM, BUT THE
PLEDGOR ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD
BY A COURT LOCATED OUTSIDE OF NEW YORK, NEW YORK.
(B) OTHER JURISDICTIONS. PLEDGOR AGREES THAT THE TRUSTEE OR ANY
HOLDER SHALL HAVE THE RIGHT TO PROCEED AGAINST PLEDGOR OR ITS PROPERTY IN A
COURT IN ANY LOCATION TO ENABLE SUCH PERSON TO (1) OBTAIN PERSONAL
JURISDICTION OVER THE PLEDGOR OR (2) REALIZE ON THE COLLATERAL OR ANY OTHER
SECURITY FOR THE SECURED OBLIGATIONS OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER ENTERED IN FAVOR OF SUCH PERSON. PLEDGOR AGREES THAT IT WILL NOT
ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY SUCH PERSON
TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE SECURED
OBLIGATIONS OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH
PERSON. PLEDGOR WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF
THE COURT IN WHICH SUCH PERSON HAS COMMENCED A PROCEEDING DESCRIBED IN THIS
SUBSECTION.
(C) INCONVENIENT FORUM. THE PLEDGOR IRREVOCABLY WAIVES ANY OBJECTION
(INCLUDING, WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR
BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER
HAVE TO
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THE BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH IN NEW YORK, NEW YORK.
18. Service of Process. The Pledgor waives personal service of any
process upon it and, as security for the Liabilities, irrevocably appoints
CT Corporation System, One North Capitol Avenue, Indianapolis, Indiana 46204
as its registered agent for the purpose of accepting service of process issued
by any court.
19. WAIVER OF JURY TRIAL. EACH OF THE PLEDGOR AND THE TRUSTEE WAIVES
ANY RIGHT TO TRIAL BY JURY IN ANY DISPUTE, WHETHER SOUNDING IN CONTRACT,
TORT, OR OTHERWISE, BETWEEN THE TRUSTEE AND THE PLEDGOR ARISING OUT OF OR
RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH. EITHER THE PLEDGOR OR THE TRUSTEE MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE
OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL
BY JURY.
20. Waiver of Bond. The Pledgor waives the posting of any bond
otherwise required of the Trustee in connection with any judicial process or
proceeding to realize on the Pledged Collateral or any other security for
the Liabilities, to enforce any judgment or other court order entered in
favor of the Trustee, or to enforce by specific performance, temporary
restraining order, or preliminary or permanent injunction, this Agreement or
any other agreement or document between the Trustee and the Pledgor.
21. Advice of Counsel. The Pledgor represents and warrants to the
Trustee and the Holders that it has consulted with its legal counsel
regarding all waivers under this Agreement, including without limitation
those under Section 12 and Sections 16 through 20 hereof, that it believes
that it fully understands all rights that it is waiving and the effect of
such waivers, that it assumes the risk of any misunderstanding that it may
have regarding any of the foregoing, and that it intends that such waivers
shall be a material inducement to the Trustee and the Holders to extend the
indebtedness secured hereby.
22. Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be
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effective and valid under applicable law, but, if any provision of this
Agreement shall be held to be prohibited or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
23. Further Assurances. The Pledgor agrees that it will cooperate
with the Trustee and will execute and deliver, or cause to be executed and
delivered, all such other stock powers, proxies, instruments and documents,
and will take all such other actions, including, without limitation, the
execution and filing of financing statements, as the Trustee may reasonably
request from time to time in order to carry out the provisions and purposes
of this Agreement.
24. The Trustee's Duty of Care. The Trustee shall not be liable for
any acts, omissions, errors of judgment or mistakes of fact or law
including, without limitation, acts, omissions, errors or mistakes with
respect to the Pledged Collateral, except for those arising out of or in
connection with the Trustee's (i) gross negligence or willful misconduct, or
(ii) failure to use reasonable care with respect to the safe custody of the
Pledged Collateral in the Trustee's possession. Without limiting the
generality of the foregoing, the Trustee shall be under no obligation to
take any steps necessary to preserve rights in the Pledged Collateral
against any other parties but may do so at its option. All expenses
incurred in connection therewith shall be for the sole account of the
Pledgor, and shall constitute part of the Liabilities secured hereby.
25. Notices. All notices and other communications required or desired
to be served, given or delivered hereunder shall be made in writing or by a
telecommunications device capable of creating a written record and shall be
addressed to the party to be notified as follows:
if to the Pledgor, at
The Majestic Star Casino, LLC
c/o Barden Development, Inc.
400 Renaissance Center
Suite 2400
Detroit, Michigan 48243
Attention: Kenneth L. Kramer
Vice President
14
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if to the Trustee, at
IBJ Schroder Bank & Trust Company
One State Street
New York, New York 10004
Attention: Corporate Trust Administration
or, as to each party, at such other address as designated by such party in a
written notice to the other party. All such notices and communications
shall be deemed to be validly served, given or delivered (i) when sent after
receipt of confirmation of answer back if sent by telecopy; (ii) upon
delivery thereof if delivered by hand to the party to be notified; (iii) one
(1) business day after deposit with a reputable overnight courier service,
with all charges prepaid.
26. AMENDMENTS, ETC. EXCEPT AS OTHERWISE PROVIDED BY THE INDENTURE,
THE CONSENT OF THE HOLDERS OF AT LEAST A MAJORITY IN PRINCIPAL AMOUNT OF THE
NOTES THEN OUTSTANDING (INCLUDING CONSENTS OBTAINED IN CONNECTION WITH A
TENDER OFFER OR EXCHANGE OFFER FOR NOTES) SHALL BE REQUIRED TO AMEND,
MODIFY, SUPPLEMENT, OR WAIVE ANY PROVISION OF THIS AGREEMENT. ANY SUCH
WAIVER OR CONSENT SHALL BE EFFECTIVE ONLY IN THE SPECIFIC INSTANCE AND FOR
THE SPECIFIC PURPOSE FOR WHICH GIVEN.
27. Section Headings. The section headings herein are for convenience
of reference only, and shall not affect in any way the interpretation of any
of the provisions hereof.
28. Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which
shall together constitute one and the same agreement.
29. Merger. This Agreement represents the final agreement of the
Pledgor with respect to the matters contained herein and may not be
contradicted by evidence of prior or contemporaneous agreements, or
subsequent oral agreements, between the Pledgor and the Trustee or any
Holder.
30. GAMING LAWS. (A) EACH OF THE PROVISIONS OF THIS AGREEMENT IS
SUBJECT TO, AND SHALL BE ENFORCED IN COMPLIANCE WITH, THE PROVISIONS OF ANY
APPLICABLE LAWS, INCLUDING, WITHOUT LIMITATION, THE RULES AND REGULATIONS OF
15
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THE INDIANA GAMING COMMISSION (TOGETHER WITH THE INDIANA RIVERBOAT GAMBLING
ACT, THE "GAMING LAWS").
(B) THE TRUSTEE ACKNOWLEDGES, UNDERSTANDS AND AGREES THAT THE GAMING
LAWS MAY IMPOSE CERTAIN LICENSING OR TRANSACTION APPROVAL REQUIREMENTS PRIOR
TO THE EXERCISE OF THE RIGHTS AND REMEDIES GRANTED TO IT UNDER THE AGREEMENT
WITH RESPECT TO THE PLEDGED COLLATERAL SUBJECT TO THE GAMING LAWS.
(C) IF ANY CONSENT UNDER THE GAMING LAWS IS REQUIRED IN CONNECTION
WITH THE TAKING OF ANY OF THE ACTIONS WHICH MAY BE TAKEN BY THE TRUSTEE IN
THE EXERCISE OF ITS RIGHTS HEREUNDER, THEN PLEDGOR AGREES TO USE ITS
REASONABLE BEST EFFORTS TO SECURE SUCH CONSENT AND TO COOPERATE WITH THE
TRUSTEE IN OBTAINING ANY SUCH CONSENT. UPON THE OCCURRENCE AND DURING THE
CONTINUATION OF ANY EVENT OF DEFAULT, PLEDGOR SHALL PROMPTLY EXECUTE AND/OR
CAUSE THE EXECUTION OF ALL APPLICATIONS, CERTIFICATES, INSTRUMENTS, AND
OTHER DOCUMENTS AND PAPERS THAT THE TRUSTEE MAY BE REQUIRED TO FILE IN ORDER
TO OBTAIN ANY NECESSARY APPROVALS UNDER THE GAMING LAWS, AND IF PLEDGOR
FAILS OR REFUSES TO EXECUTE SUCH DOCUMENTS, THE TRUSTEE OR THE CLERK OF THE
COURT WITH JURISDICTION MAY EXECUTE SUCH DOCUMENTS ON BEHALF OF PLEDGOR.
(D) NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT TO THE
CONTRARY, NOTHING IN THIS AGREEMENT SHALL (I) EFFECT ANY TRANSFER OF ANY
OWNERSHIP INTEREST (WITHIN THE MEANING OF 68 INDIANA ADMINISTRATIVE CODE 5)
IN PLEDGOR OR (II) EFFECT ANY TRANSFER, SALE, PURCHASE, LEASE OR
HYPOTHECATION OF, OR ANY BORROWING OR LOANING OF MONEY AGAINST, OR ANY
ESTABLISHMENT OF ANY VOTING TRUST AGREEMENT OR OTHER SIMILAR AGREEMENT WITH
RESPECT TO (ALL WITHIN THE MEANING OF INDIANA CODE 4-33-4-21), ANY
CERTIFICATE OF SUITABILITY OR ANY OWNER'S LICENSE HERETOFORE OR HEREAFTER
ISSUED TO ANY PERSON, INCLUDING PLEDGOR, UNDER ANY GAMING LAWS, INCLUDING
INDIANA CODE 4-33.
31. INTERACTION WITH INDENTURE. ALL TERMS, COVENANTS, CONDITIONS,
PROVISIONS AND REQUIREMENTS OF THE INDENTURE ARE INCORPORATED BY REFERENCE
IN THIS AGREEMENT. IN THE EVENT OF ANY CONFLICT OR INCONSISTENCY BETWEEN
THE PROVISIONS OF THIS AGREEMENT AND THOSE OF THE INDENTURE, INCLUDING,
WITHOUT LIMITATION, ANY CONFLICTS OR INCONSISTENCIES IN ANY DEFINITIONS
HEREIN OR THEREIN, THE PROVISIONS OR DEFINITIONS OF THE INDENTURE SHALL
GOVERN.
32. TRUST INDENTURE ACT. IF ANY PROVISION OF THIS AGREEMENT CONFLICTS
WITH ANY PROVISION OF THE TRUST INDENTURE ACT, THE PROVISIONS OF THE TRUST
INDENTURE ACT SHALL CONTROL.
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33. APPOINTMENT OF COLLATERAL AGENT. THE TRUSTEE MAY, SOLELY AT ITS
DISCRETION, APPOINT A COLLATERAL AGENT TO ENFORCE THE RIGHTS AND REMEDIES
AVAILABLE TO THE TRUSTEE UNDER THIS AGREEMENT.
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IN WITNESS WHEREOF, the Pledgor and the Trustee have executed this
Agreement as of the date set forth above.
THE MAJESTIC STAR CASINO, LLC
as the Pledgor
By: Barden Development, Inc.
By: /s/ Kenneth L. Kramer
----------------------------
Name: Kenneth L. Kramer
Title: Vice President
IBJ SCHRODER BANK & TRUST COMPANY,
as Trustee
By: /s/ Nancy R. Besse
-----------------------------
Name: Nancy R. Besse
Title: Vice President
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EXHIBIT A
to
PLEDGE AGREEMENT
dated as of May 22, 1996
Pledged Membership Interests
Percentage of
Membership Interest
Name by the Pledgor
---- -------------------
Buffington Harbor Riverboats, L.L.C. 50%
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EXHIBIT B
to
PLEDGE AGREEMENT
dated as of May 22, 1996
Instruction in Connection with
Uncertificated Securities
May __, 1996
Limited Liability Company:
Buffington Harbor Riverboats, L.L.C.
MEMBERSHIP INTEREST OWNER:
THE MAJESTIC STAR CASINO, LLC
c/o Barden Development, Inc.
400 Renaissance Center
Suite 2400
Detroit, Michigan 48243
Attention: Kenneth L. Kramer
Vice President
Reference is hereby made to that certain Pledge Agreement dated as of
May 22, 1996 (the "Pledge") between The Majestic Star Casino, LLC ("Interest
Owner"), a member of Buffington Harbor Riverboats, L.L.C. (the"BHR Joint
Venture") and IBJ Schroder Bank & Trust Company as Trustee, as pledgee
("Pledgee").
1. Pledge Instructions. The BHR Joint Venture is hereby instructed by
the Interest Owner to register all of the Interest Owner's right, title and
interest in and to the fifty percent (50%) limited liability company
interest in the BHR Joint Venture currently owned by it and any limited
liability company interest in the BHR Joint Venture hereafter owned by the
Interest Owner as subject to a pledge in favor of Pledgee who, upon such
registration of pledge, shall become the registered pledgee of the limited
liability company interests with all rights incident thereto.
2. Initial Transaction Statement. The BHR Joint Venture is further
instructed by the Interest Owner to promptly inform Pledgee of the
registration of the pledge by sending the initial transaction statement, in
the form attached hereto as Annex A, to Pledgee at its office located at One
State Street, New York, New York 10004.
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3. Warranties of the Interest Owner. The Interest Owner hereby
warrants that (i) the Interest Owner is an appropriate person to originate
this instruction; (ii) the Interest Owner is entitled to effect the
instruction here given; and (iii) the Interest Owner's taxpayer
identification number is 43-1664986.
IN WITNESS WHEREOF, the Interest Owner has caused this Pledge
Instruction to be duly signed and delivered by its officer duly authorized
as of the date first above written.
THE MAJESTIC STAR CASINO, LLC
By: Barden Development, Inc.
By:__________________________
Title:_______________________
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Annex A
to
PLEDGE INSTRUCTION
dated as of May 22, 1996
Form of Initial Transaction Statement
May __, 1996
IBJ Schroder Bank & Trust Company, as Trustee
One State Street
New York, New York 10004
Attention: Corporate Trust Administration
The Majestic Star Casino, LLC
c/o Barden Development, Inc.
400 Renaissance Center
Suite 2400
Detroit, Michigan 48243
Reference is hereby made to that certain Pledge Agreement dated as of
May 22, 1996 (the "Pledge") between The Majestic Star Casino, LLC ("Interest
Owner"), a member of Buffington Harbor Riverboats, L.L.C. (the "BHR Joint
Venture") and IBJ Schroder Bank & Trust Company as Trustee, as pledgee
("Pledgee").
On ___________, 199_, the pledge of the fifty percent (50%) limited
liability company interest in the BHR Joint Venture owned by the Interest
Owner (the "Pledged Membership Interests") by Interest Owner in favor of the
Pledgee was registered on the books and records of the BHR Joint Venture.
Except for the pledge in favor of the Pledgee, there are no liens or
restrictions of the BHR Joint Venture or adverse claims (as to which the BHR
Joint Venture has a duty under Section 8-403(4) of the Uniform Commercial
Code) to which the Pledged Membership Interests are or may be subject as of
the date of the registration of this pledge.
The name of the registered owner of the Pledged Membership Interests is
The Majestic Star Casino, LLC. The address of the Interest Owner is set
forth above. The taxpayer identification number of the Interest Owner is
43-1664986.
The name of the registered pledgee of the Pledged Membership Interests
is IBJ Schroder Bank & Trust Company, as Trustee. The address of the
Pledgee is set forth above. The taxpayer identification number of the Pledgee
is 13-5375195.
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THIS STATEMENT IS MERELY A RECORD OF THE RIGHTS OF THE ADDRESSEES AS OF
THE TIME OF ITS ISSUANCE. DELIVERY OF THIS STATEMENT, OF ITSELF, CONFERS NO
RIGHTS ON THE RECIPIENTS. THIS STATEMENT IS NEITHER A NEGOTIABLE INSTRUMENT
NOR A SECURITY.
BUFFINGTON HARBOR RIVERBOATS, L.L.C.
By: The Majestic Star Casino, LLC
By: Barden Development, Inc.
By:
Name:
Title:
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EXHIBIT C
to
PLEDGE AGREEMENT
dated as of May 22, 1996
Notice in Connection with
Uncertificated Securities
May __, 1996
Facsimile and
First Class Mail
Nicholas L. Ribis
President
Trump Indiana, Inc.
725 Fifth Avenue
New York, New York 10022
Re: Buffington Harbor Riverboats, L.L.C.
NOTICE OF PLEDGE OF MEMBERSHIP INTEREST
Dear Mr. Ribis:
This will advise you that we have this date pledged our entire membership
interest in Buffington Harbor Riverboats, L.L.C. (the "Company") to IBJ
Schroder Bank & Trust Company, as trustee (the "Pledgee"), as security for
financing as permitted under Section 8 of the Company's Operating Agreement.
To register this pledge, we have made notation in the Company's records in
the form attached hereto, a copy of which is furnished for your information.
In the event that you receive written notice from the Pledgee that a default
has occurred under the terms of any of the loan documents between The
Majestic Star Casino, LLC and the Pledgee, you may agree to remit to the
Pledgee all distributions and
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payments that would otherwise be payable to us upon redemption, termination
or dissolution of the Company.
Very truly yours,
THE MAJESTIC STAR CASINO, LLC
By: Barden Development, Inc.
By: _________________________
Name:
Title: