Exhibit 10.1

AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

THIS AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this
“Amendment”) is entered into as of  August 14, 2007 with reference to the Second
Amended and Restated Credit Agreement dated as of January 3, 2007 (the “Credit
Agreement”), among Herbst Gaming, Inc., a Nevada corporation (the “Borrower”),
the lenders party thereto (collectively, the “Lenders”) and Bank of America,
N.A. as Administrative Agent (the “Administrative Agent”).  Capitalized terms
used but not defined herein are used with the meanings set forth for those terms
in the Credit Agreement.   The parties hereto hereby agree with reference to the
following facts:

A.            Borrower has requested a one time waiver of the financial
covenants contained in Sections 7.12, 7.13 and 7.14 of the Credit Agreement (the
“Financial Covenants”) for the Fiscal Quarter ended June 30, 2007.

B.            It is anticipated that, following the delivery of revised
projections referred to in Section 2, below, Borrower will request an additional
amendment to the Credit Agreement which will address any required revisions to
the Financial Covenants and any related revision to the interest rates and other
terms of the Credit Agreement required by the applicable Lenders.

NOW, THEREFORE, Borrower and the Administrative Agent, acting with the consent
of the Requisite Lenders pursuant to Section 10.01 of the Credit Agreement,
agree to amend the Credit Agreement as follows:

1.             The Comprehensive Amendment.  Borrower acknowledges that the
Lenders are not required to enter into any future amendments or waivers of  the
Credit Agreement, and that the execution of any amendment of the type described
in Recital B above shall be in the discretion of the Lenders. 

2.             Waiver.  The Lenders hereby waive the covenants contained in
Sections 7.12, 7.13 and 7.14 of the Credit Agreement for the Fiscal Quarter
ended June 30, 2007 only.  This is a one time waiver, and the Lenders shall be
entitled to require full compliance with the covenants set forth in such
Sections as of September 30, 2007 and each subsequent Fiscal Quarter. 

3.             Covenant.  Borrower covenants that it shall, not later than
October 31, 2007, deliver to the Administrative Agent (and the Administrative
Agent shall provide to each “private side” lender (i.e., those which have
elected to receive material non-public information), revised projections of its
anticipated financial performance in a format reasonably acceptable to the
Administrative Agent.

4.             Representations and Warranties.  Borrower represents and warrants
to the Administrative Agent and the Lenders that:

(a)           Giving effect to the execution and delivery of this Amendment, no
Default or Event of Default has occurred and remains continuing; and

(b)           Each of the representations and warranties set forth in Article 5
of the Credit Agreement are true and correct as of the date of this Amendment
(other than those representations which relate solely to a prior date, each of
which was true as of that date).

5.             Increase to Interest Rate and Letter of Credit Fees.  Borrower
hereby agrees that, effective as of the effective date of this Amendment (i.e.,
August 14, 2007), the Applicable Rate shall be

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increased to (a) 3.00% per annum for each Loan which is a Eurodollar Rate Loan,
(b) 1.75% per annum for each Loan which is a Base Rate Loan, and (c) 3.00% per
annum for each Letter of Credit.  Borrower further agrees that in the event that
the Borrower’s corporate family rating is reduced by Moody’s to B2, then during
the period in which such ratings are effective, the Applicable Rate shall be
increased to (a) 3.50% per annum for each Loan which is a Eurodollar Rate Loan,
(b) 2.25% per annum for each Loan which is a Base Rate Loan, and (c) 3.50% per
annum for each Letter of Credit.  No reductions to the Applicable Rate to rates
below the rates set forth in this Section (including any elimination of the 50
basis point increase resulting from ratings declines) will be effective without
the written consent of each of the Lenders party to the Credit Agreement.

6.             Prepayment Premium.  Notwithstanding Section 2.07(a) of the
Credit Agreement,  in the event that Borrower makes any prepayment of the Term B
Loans or the Delay Draw Term B Loans (other than the mandatory prepayments
required by the terms of Section 2.07(d), (e), (f) or (g) of the Credit
Agreement), Borrower shall concurrently pay to the Lenders holding the Term B
Loans or the Delayed Draw Term Loans so prepaid, a prepayment premium at the
applicable rate set forth below, in each case times the principal amount of the
Term B Loans or Delay Draw Term Loans prepaid:

Prepayments made during the period between:

 

 

 

Applicable Prepayment Premium

 

August 14, 2007 and August 13, 2008

 

2% of the principal amount prepaid

 

August 14, 2008 and August 13, 2009

 

1% of the principal amount prepaid

 

August 14, 2009 and thereafter

 

0%

 

 

Each amendment, modification or waiver of the provisions of this Section 6 shall
require the written consent of each of Lender directly affected thereby.

7.             Conditions; Effectiveness.  The effectiveness of this Amendment
shall be subject to the conditions precedent that, on or before the effective
date of this Amendment:

(a)          The Administrative Agent shall have received this Amendment
executed by Borrower;

(b)          The Administrative Agent shall have received a written consent
hereto from Borrower’s Subsidiaries in the form of Exhibit “A” hereto;

(c)          The Administrative Agent shall have received written consent of the
Requisite Lenders as required under Section 10.01 of the Credit Agreement in the
form of Exhibit “B” hereto; and

(d)          Borrower shall have paid, or shall concurrently pay, to each Lender
which has executed a consent to this Amendment and delivered it to the
Administrative Agent prior to 5:00 p.m. (New York local time) on Friday, August
10, 2007, an amendment fee in respect of its Revolving Commitments and Term
Loans at the rate advised to the Lenders by the Administrative Agent (which
amendment fee rate shall be equal for each Lender approving this Amendment).

8.             Effectiveness of the Credit Agreement.  Except as hereby
expressly amended, the Credit Agreement remains in full force and effect, and is
hereby ratified and confirmed in all respects.

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9.             Counterparts.  This Amendment may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.

 

 

HERBST GAMING, INC., a Nevada corporation,

 

as Borrower

 

 

 

 

By:

/s/ Edward J. Herbst

 

Name:

Edward J. Herbst

 

Title:

President

 

 

 

 

 

 

 

BANK OF AMERICA, N.A.,

 

as Administrative Agent and L/C Issuer

 

 

 

 

By:

/s/ Maurice E. Washington

 

Name:

Maurice E. Washington

 

Title:

Vice President

 

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Exhibit A to Amendment

CONSENT OF GUARANTORS

This Consent of Guarantors is delivered with reference to the Second Amended and
Restated Credit Agreement dated as of January 3, 2007 (the “Credit Agreement”),
among Herbst Gaming, Inc., a Nevada corporation (the “Borrower”), the lenders
from time to time party thereto (the “Lenders”) and Bank of America, N.A. as
Administrative Agent (“Administrative Agent”). Capitalized terms used herein are
used with the meanings set forth for those terms in the Credit Agreement.

The undersigned consent to and approve Borrower’s execution and delivery of the
proposed Amendment No. 1 to the Credit Agreement, and hereby reaffirm their
respective guarantees of the Credit Agreement.

 

 

CALIFORNIA PROSPECTORS, LTD.,
a Nevada limited liability company

 

CARDIVAN COMPANY, a Nevada corporation

 

CORRAL COIN, INC., a Nevada corporation

 

CORRAL COUNTRY COIN, INC., a Nevada corporation

 

DAYTON GAMING, INC., a Nevada corporation

 

E-T-T ENTERPRISES L.L.C., a Nevada limited liability company

 

E-T-T, INC., a Nevada corporation

 

FLAMINGO PARADISE GAMING, LLC, a Nevada limited liability company

 

HGI — LAKESIDE, INC., a Nevada corporation

 

HGI — MARK TWAIN, INC., a Nevada corporation

 

HGI — ST. JO, INC., a Nevada corporation

 

LAST CHANCE, INC., a Nevada corporation

 

MARKET GAMING, INC., a Nevada corporation

 

PLANTATION INVESTMENTS, INC., a Nevada corporation

 

THE PRIMADONNA COMPANY, a Nevada corporation

 

THE SANDS REGENT, a Nevada corporation

 

ZANTE INC., a Nevada corporation

 

 

 

 

By:

/s/ Edward J. Herbst

 

Authorized signatory for each of the foregoing

 

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Exhibit B to Amendment

CONSENT OF LENDER

Reference is hereby made to the Second Amended and Restated Credit Agreement
dated as of January 3, 2007 (the “Credit Agreement”), among Herbst Gaming, Inc.,
a Nevada corporation (the “Borrower”), the lenders party thereto (collectively,
the “Lenders”) and Bank of America, N.A. as Administrative Agent (the
“Administrative Agent”).  Capitalized terms used herein are used with the
meanings set forth for those terms in the Loan Agreement.

The undersigned Lender hereby consents to the execution and delivery of the
proposed Amendment No. 1 to Amended and Restated Credit Agreement by the
Administrative Agent on its behalf, substantially in the form of the most recent
draft thereof presented to the undersigned Lender.

Dated as of                         , 2007.

 

 

 

 

[Name of Lender]

 

 

 

 

 

 

 

By:

 

 

 

 

 

Title:

 

 

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