Exhibit 10.1
FORBEARANCE AGREEMENT
THIS FORBEARANCE AGREEMENT (this “Agreement”), dated as of the 19th day of
February, 2009 (the "Execution Date”), is entered into by and among Virgin River
Casino Corporation, a Nevada corporation (“Virgin River”), RBG, LLC, a Nevada
limited liability company (“RBG”), B & BB, Inc., a Nevada corporation (“B&BB”
and, together with Virgin River and RBG, the “Issuers”), Casablanca Resorts,
LLC, a Nevada limited liability company (“Casablanca”), Oasis Interval
Ownership, LLC, a Nevada limited liability company (“Oasis Ownership”), Oasis
Interval Management, LLC, a Nevada limited liability company (“Oasis
Management”), Oasis Recreational Properties, Inc., a Nevada corporation (“Oasis
Recreational”), Black Gaming, LLC, a Nevada limited liability company (“Black
Gaming”), R. Black, Inc., a Nevada corporation (“R. Black” and, together with
Casablanca, Oasis Ownership, Oasis Management, Oasis Recreational, and Black
Gaming, the “Guarantors” and, together with the Issuers, the “Obligors”) and
Drawbridge Special Opportunities Advisors LLC, as agent on behalf of certain
funds and accounts (“Drawbridge”), BlackRock Financial Management, Inc. High
Yield Group, as investment advisors/sub-advisors for certain accounts
(“BlackRock”), Midland National Life Insurance Company and 1888 FUND, LTD.
(collectively, “Guggenheim”) and Silver Point Capital Offshore Fund Ltd.
(“Silver Point” and, together with Drawbridge, BlackRock and Guggenheim, the
“Majority Note Holders”).
RECITALS
A. The Issuers and The Bank of New York Trust Company, N.A., a national banking
association (the “Trustee”), have entered into that certain Indenture dated as
of December 20, 2004 (together with all supplements thereto, the “Indenture”),
whereby the Issuers issued 9.000% Senior Secured Notes due in 2012 in the
aggregate principal amount of $125,000,000 for the benefit of the Holders
thereof (together with all modifications, extensions, renewals and replacements
thereof, if any, the “Senior Secured Notes”).
B. The Guarantors have each executed guarantees in favor of the Holders of the
Senior Secured Notes (collectively, the “Guarantees”), guaranteeing all of the
Issuers’ obligations under the Senior Secured Notes and the Indenture on the
terms and conditions set forth in such Guarantees and the Indenture. This
Agreement, the Indenture, the Senior Secured Notes, the Guarantees, and all
mortgages, deeds of trust, security agreements, pledge agreements, control
agreements, collateral assignment agreements and all other agreements,
instruments, and documents executed in connection with the Indenture and Senior
Secured Notes, including without limitation the Collateral Agreements, are
referred to collectively herein as the “Loan Documents”.
C. The next installment of interest payable on the Senior Secured Notes in the
amount of Five Million Six Hundred Twenty-Five Thousand Dollars ($5,625,000)
(the “Interest Payment”) was due on January 15, 2009 (the “Interest Due Date”),
with a thirty (30) day grace period for the payment thereof (the “Grace
Period”).
D. Issuers did not make the Interest Payment on the Interest Due Date nor within
the Grace Period, which results in an Event of Default under the terms of the
Indenture and the Senior Secured Notes (the “Payment Default”).

 

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E. In addition to the Payment Default, certain covenant defaults or other Events
of Default may also occur under the Indenture on or after the Grace Period (the
“Potential Other Defaults” and, together with the Payment Default, the
“Specified Defaults”).
F. In the event any Specified Default occurs, the Issuers have requested the
Majority Note Holders, and the Majority Note Holders have agreed, subject to and
in accordance with the terms and conditions set forth in this Agreement, to
forbear from exercising any of their rights or remedies under the Loan Documents
and from taking any action to cause the Trustee to exercise any of the Trustee’s
rights or remedies with respect to the Specified Defaults, and, furthermore, in
the event Trustee does take any action with respect to any of the Specified
Defaults, to the extent provided for in the Loan Documents, to cause the Trustee
to forbear from exercising any of its rights or remedies under the Loan
Documents, in each case, until the Scheduled Forbearance Termination Date (as
defined below) (subject to termination as set forth below).
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants hereinafter stated, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
AGREEMENT
1. Recitals. Each of the Issuers hereby acknowledges and agrees that the
recitals set forth above are true and correct and that the total aggregate
outstanding obligations under the Indenture consists of the principal balance of
the Senior Secured Notes as of the Execution Date of $125,000,000, plus all
accrued and unpaid interest thereon, and any other amounts that are due and
owing under the Loan Documents.
2. Defined Terms. All capitalized terms used herein (including, without
limitation, in the preamble and preliminary statements hereof) that are not
otherwise defined shall have the meanings ascribed to such terms in the
Indenture or the Collateral Agreements, as applicable.
3. Reaffirmation of Loan Documents. Each of the Issuers hereby acknowledges and
reaffirms each and all of the Issuers’ obligations, duties, covenants and
liabilities under the Loan Documents, including, but not limited to, the
obligation to pay all amounts due under the Senior Secured Notes. Each of the
Issuers further acknowledges and agrees that (i) the Loan Documents are valid,
binding and enforceable in accordance with their terms and remain in full force
and effect, (ii) the liens and security interests granted pursuant to the
Collateral Agreements are valid, perfected and enforceable liens, and all such
liens and security interests and all Collateral granted as security under the
Collateral Agreements continues to be and remains collateral for the
indebtedness and obligations under the Indenture, and (iii) there are no claims,
demands, offsets or defenses at law or in equity that would defeat or diminish
the Majority Note Holders’ present and unconditional right to collect the
indebtedness evidenced by the Senior Secured Notes and to proceed to enforce the
rights and remedies available to the Majority Note Holders as provided in the
Loan Documents or by law.
4. Reaffirmation of Guarantees. Each of the Guarantors hereby acknowledges and
reaffirms all of the Guarantors’ respective obligations, duties, covenants and
liabilities under the terms and conditions of the Guarantees, including, but not
limited to, the obligation to pay all amounts due under their respective
Guarantees. Each of the Guarantors further acknowledges and agrees that (i) the
Guarantees are valid, binding and enforceable in accordance with their
respective terms and remain in full force and effect, and (ii) there are no
claims, demands, offsets or defenses at law or in equity that would defeat or
diminish the Majority Note Holders’ present and unconditional right to collect
the amounts due under the Guarantees and to proceed to enforce the rights and
remedies available to the Majority Note Holders as provided in the Guarantees or
by law.

 

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5. Forbearance.
(a) So long as none of the Issuers or Guarantors defaults under the terms of
this Agreement, and otherwise subject to the terms and conditions set forth
herein, the Majority Note Holders agree to forbear from exercising any of their
rights or remedies under the Loan Documents and from taking any action to cause
the Trustee to exercise any of the Trustee’s rights or remedies, in each case,
arising out of the Specified Defaults during the period commencing on the
Effective Date and terminating on the Termination Date (as defined below) (the
“Forbearance Period”). Furthermore, in the event Trustee does take any action
with respect to any of the Specified Defaults during the Forbearance Period, to
the extent provided for in the Loan Documents, Majority Note Holders shall cause
the Trustee to forbear from exercising any of its rights or remedies under the
Loan Documents. During the Forbearance Period, interest shall continue to accrue
on the entire unrepaid balance of the Senior Secured Notes and on the Interest
Payment in accordance with Section 4.1 of the Indenture and in the Senior
Secured Notes. The “Termination Date” shall be the earlier to occur of the
Scheduled Forbearance Termination Date or the occurrence of a Forbearance Event
Default (as such terms are defined below).
(b) Notwithstanding anything to the contrary contained herein or in the Loan
Documents, each of the Obligors acknowledges and agrees that (i) except for the
limited forbearance set forth herein granted by the Majority Note Holders, the
actions of each of the Majority Note Holders in entering into this Agreement
shall not constitute or be construed or deemed as (x) a waiver or relinquishment
of, or estoppel to assert, any rights or remedies under any of the Loan
Documents, applicable law or in equity, (y) a waiver of any Event of Default or
Default under the Loan Documents, or (z) an amendment, modification or consent
to any non-compliance to any provision under the Loan Documents; (ii) except as
set forth herein, each of the Majority Note Holders reserves the right to
enforce each and every term of the Loan Documents; (iii) each of the Majority
Note Holders is under no duty or obligation of any kind or any nature to grant
any of the Issuers any additional period of forbearance beyond that provided
herein; (iv) the actions of each of the Majority Note Holders in entering into
this Agreement are without prejudice to the right of each of the Majority Note
Holders to pursue any and all remedies under the Loan Documents, pursuant to
applicable law, or in equity available to it in its sole discretion upon the
termination (whether upon expiration thereof, upon acceleration, or otherwise)
of this Agreement; (v) the Senior Secured Notes will remain in default
throughout the Forbearance Period and, but for this Agreement, the Majority Note
Holders would be entitled to exercise their rights and remedies under the Loan
Documents and applicable law in respect of the Specified Defaults; (vi) the
Obligors have no defenses, setoffs, or counterclaims against the Majority Note
Holders or, alternatively, to the extent that any defenses, setoffs, or
counterclaims exist, the Obligors hereby waive any and all defenses, setoffs,
and counterclaims which they may have or claim to have in respect of the
obligations of the Obligors under the Loan Documents; and (vi) the Forbearance
Period will expire automatically and without notice immediately upon the
occurrence, at any time prior to the expiration of the Forbearance Period, of
any breach, Default or Event of Default on the part of the Issuers or Guarantors
under this Agreement or, upon the expiration of the Forbearance Period.
(c) The Scheduled Forbearance Termination Date shall be March 9, 2009 (the
“Scheduled Forbearance Termination Date”), provided that (i) on or before
March 2, 2009, the Issuers deliver to Morgan Joseph & Co., Inc. (“Morgan
Joseph”) and Cadwalader, Wickersham & Taft LLP (“CWT” and, together with Morgan
Joseph, the “Professional Advisors”) a summary of indicative terms and
conditions in respect of the restructuring of the obligations under the
Indenture, the Credit Agreement and any other Indebtedness (the “Term Sheet”)
and (ii) on or before March 6, 2009, the Issuers deliver to the Professional
Advisors a 13-week cash flow forecast for the succeeding 13 calendar weeks in
form and substance acceptable to the Professional Advisors.

 

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6. Cure. To the extent provided for in the Loan Documents, the Majority Note
Holders acknowledge and agree that the Issuers shall have the right to cure the
Specified Defaults at any time during the Forbearance Period by indefeasible
payment of all Interest Payments and other amounts due and owing under the
Indenture, the Senior Secured Notes and the Loan Documents.
7. Representations and Warranties by Issuers and Guarantors. As a material
inducement for Majority Note Holders to enter into this Agreement, each of the
Obligors hereby represent and warrant to Majority Note Holders that:
(a) Each of the Issuers and Guarantors have full power and authority (and all
necessary action has been taken) to execute, deliver and perform its obligations
under this Agreement, and that this Agreement is binding upon and enforceable
against each of the Issuers and Guarantors in accordance with its terms.
(b) Each of the Issuers’ and Guarantors’ delivery and performance of this
Agreement does not and will not (i) violate any law, rule, regulation or court
order to which any of the Issuers or Guarantors are subject, or (ii) conflict
with or result in a breach of the articles of formation, bylaws, operating
agreement or other formation document of any of the Issuers or Guarantors or any
agreement or instrument to which any of Issuers or Guarantors are a party or by
which any of Issuers or Guarantors are bound.
(c) As of the Execution Date, each of the Obligors do not have cash or cash
equivalents in any Deposit Account, Securities Account or any other bank account
or similar account with a financial institution other than with those
institutions disclosed by the Obligors to either Morgan Joseph or CWT and set
forth on Schedule “A” hereof (the “Disclosed Banks”).
(d) Each of the representations and warranties made by all of the Obligors in
the Loan Documents are true, correct and complete as of the Execution Date in
all material respects.
8. Representations and Warranties by the Majority Note Holders. Each of the
Majority Note Holders hereby represent and warrant to the Issuers and Guarantors
that:
(a) Each of the Majority Note Holders have full power and authority (and all
necessary action has been taken) to execute, deliver and perform their
obligations under this Agreement, and that this Agreement is binding upon and
enforceable against each of the Majority Note Holders in accordance with its
terms.
(b) Each of the Majority Note Holders’ delivery and performance of this
Agreement does not and will not (i) violate any law, rule, regulation or court
order to which any of the Majority Note Holders are subject, or (ii) conflict
with or result in a breach of the articles of formation, bylaws, operating
agreement or other formation document of any of the Majority Note Holders or any
agreement or instrument to which any of Majority Note Holders are a party or by
which any of Majority Note Holders are bound.
(c) As of the Execution Date, the Majority Note Holders are the Holders of more
than seventy-five percent (75%) of the total aggregate outstanding principal
amount of the Senior Secured Notes.

 

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9. Release.
(a) In order to induce Majority Note Holders to enter into this Agreement, and
in consideration thereof, each of the Issuers and Guarantors, for themselves,
their members and their respective successors and assigns (collectively, the
“Issuers’ Parties”), hereby release and discharge each of the Majority Note
Holders, and their respective officers, directors, shareholders, partners,
agents, employees, servants, related corporations, subsidiaries, affiliates,
partnerships, or other entities related thereto and their attorneys and advisors
(collectively, the “Released Parties”) of and from any and all claims, liens,
demands, causes of action, controversies, offsets, obligations, losses, damages
and liabilities of every kind and character whatsoever, including, without
limitation, any action, omission, misrepresentation or other basis of liability
founded either in tort or contract and the duties arising thereunder, that the
Issuers’ Parties, or any one or more of them, has had in the past, or now has,
whether known or unknown, whether asserted or unasserted, by reason of any
matter, cause or thing set forth in, relating to, or arising out of, or in any
way connected with or resulting from the Loan Documents, this Agreement and/or
the transactions described in this Agreement.
(b) The Issuers’ Parties acknowledge that they may be unaware of one or more
facts or may hereafter discover facts in addition to or different from those
which it has now or believes to be true with respect to the subject matter of
this release, the Loan Documents, this Agreement and/or the transactions
described in this Agreement, but it is the Issuers’ Parties’ intention to
finally and forever release any and all of the matters as set forth herein and,
in furtherance of such intention, the release herein given shall be and remain
in effect notwithstanding the discovery of any such additional or different
facts. The Issuers’ Parties hereby acknowledge that no one has made any promise,
representation, or warranty whatsoever, express, implied or statutorily not
contained herein to induce them to execute this release in reliance on any
promise, representation, or warranty not contained herein and that they have
been given the opportunity at all times to be represented by an attorney and
have been represented and advised by an attorney.
(c) Nothing in this Agreement, or in the discussions and negotiations of the
parties which preceded its execution, shall be directly or indirectly construed,
or be admissible in any legal action or proceeding or otherwise, as an admission
by any Released Party that any obligation, liability, contract, claim or cause
of action exists which is within the scope of those released within this
Section 9.
(d) Each of the Issuers and Guarantors acknowledges that the release contained
herein constitutes a material inducement to the Majority Note Holders to enter
into this Agreement, and that the Majority Note Holders would not have done so
but for this release and the Majority Note Holders’ expectation that the same is
valid and enforceable in any and all events.
10. Covenants.
(a) Each of the Obligors shall provide to Morgan Joseph reasonably full and
timely access to each of the Obligors’ books, records, and financial personnel
upon reasonable advance notice during regular business hours.
(b) The Obligors shall notify the Majority Note Holders within forty-eight
(48) hours of any of the Obligors (i) opening a new account with a financial
institution that is not a Disclosed Bank, or (ii) transferring any cash or cash
equivalents from any Deposit Account, Securities Account or any other bank
account or similar account that any of the Obligors maintain with a Disclosed
Bank to a financial institution that is not a Disclosed Bank. Upon such
notification, the Obligors and Majority Note Holders hereby agree that Schedule
“A” is amended to include the new financial institution as a Disclosed Bank
without any further written modification necessary, and such new financial
institution shall be deemed a Disclosed Bank effective as of the date of such
notification.

 

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11. Events of Default. Each of the following events shall be an event of default
hereunder and shall, in addition to all remedies available to the Majority Note
Holders under the Loan Documents and/or applicable law, give rise to the
remedies set forth in Section 12 below. Each event of default hereunder shall
also be an Event of Default under the Loan Documents and shall give rise to the
rights and remedies thereunder (each, a “Forbearance Event of Default”).
(a) Any of the Issuers or Guarantors shall fail to perform any of their
respective obligations or any of the terms, provisions, covenants, conditions,
or agreements contained in this Agreement.
(b) Any representation or warranty made in writing by or on behalf of any of the
Issuers or Guarantors pursuant hereto or otherwise in connection with the
transactions contemplated hereby or in any report, certificate, financial
statement or other document furnished in connection with this Agreement or any
agreements, documents or instruments executed in connection herewith shall be
inaccurate or incomplete in any material respect.
(c) The occurrence of a default by any of the Issuers or Guarantors or an “Event
of Default” (or any similar such term provided therein) under that certain
Credit Agreement dated December 20, 2004 by and among the Issuers, the
Guarantors and Wells Fargo Foothill, Inc. (as amended, supplemented, modified,
renewed, extended, or restructured from time to time and expressly including any
agreement extending the maturity date thereunder or providing for the
forbearance by Wells Fargo Foothill, Inc. of any of its rights or remedies
thereunder), and an exercise by Wells Fargo Foothill, Inc. of any of its rights
or remedies against any of the Issuers or Guarantors under the terms of such
Credit Agreement.
(d) The occurrence of an Event of Default under Sections 6.1(4), (5) and
(7) through (12) of the Indenture, beyond any applicable notice and cure
periods.
(e) The failure of the Issuers to (i) deliver the Term Sheet to the Professional
Advisors by no later than March 2, 2009 and (ii) to meet in person with the
Professional Advisors during the calendar week of March 2, 2009 to discuss the
Term Sheet.
(f) The failure of the Issuers and/or Black Gaming to pay in full all incurred
and unpaid fees and expenses of the Professional Advisors pursuant to the Morgan
Joseph Agreement and the CWT Agreement, as such terms are hereinafter defined,
within five (5) days of the Execution Date.
(g) The failure of the Obligors to notify the Majority Note Holders, as required
in Section 10(b) above, within forty-eight (48) hours of any of the Obligors’
(i) opening a new account with a financial institution that is not a Disclosed
Bank, or (ii) transferring any cash or cash equivalents to a Deposit Account,
Securities Account or any other bank account or similar account that any of the
Obligors maintain with a Disclosed Bank to a financial institution that is not a
Disclosed Bank.
12. Remedies. Upon the occurrence of a Forbearance Event of Default under
Section 11 above, at the sole option and immediately upon written declaration by
the Majority Note Holders, the forbearance hereunder shall terminate, and the
Majority Note Holders may immediately, and without expiration of any period of
grace, exercise and enforce any or all of their rights and remedies under the
Loan Documents.
13. Non-Impairment. Except as expressly provided herein, nothing in this
Agreement shall alter or affect any provision, condition or covenant contained
in the Loan Documents, or affect or impair any rights, powers, or remedies
thereunder, it being the mutual intent of the parties hereto that the provisions
of the Loan Documents shall continue in full force and effect.

 

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14. No Waiver. No failure to exercise, and no delay in exercising any right,
power or remedy hereunder or under any document delivered pursuant hereto shall
impair any right, power or remedy which the Majority Note Holders may have, nor
shall any such delay be construed to be a waiver of any of such rights, powers,
or remedies, or an acquiescence in any breach or default under this Agreement or
any document delivered pursuant hereto nor shall any waiver of any breach or
default of any of the Issuers or Guarantors hereunder be deemed a waiver of any
default of breach subsequently occurring. The rights and remedies herein
specified are cumulative and not exclusive of any rights or remedies which the
Majority Note Holders would otherwise have.
15. Entire Agreement; Amendment. The Loan Documents, including this Agreement,
contain or expressly incorporate by reference the entire agreement of the
parties with respect to the matters contemplated therein, and supersede all
prior negotiations. This Agreement shall not be modified except by written
instrument executed by all parties hereto.
16. No Further Commitment. Issuers and Guarantors each expressly acknowledge
that (a) the Majority Note Holders have not made and are not making any
commitment for, and there is no understanding, explicit or implicit, relating
to, or affecting, any forbearance or forgiveness of future interest and/or
principal, or any other matter, except as set forth in this Agreement, and
(b) Majority Note Holders have made no commitment with respect to, and there is
no understanding, explicit or implicit, relating or affecting the terms of any
further forbearance, restructure, workout or extension.
17. Notices. Notwithstanding anything to the contrary contained in the Loan
Documents, all communications, notices and demands of any kind which any party
hereto may be required or may desire to serve upon any other party shall be made
in writing and shall be effective upon the earliest of the following to occur:
(a) when personally delivered to the recipient; (b) one (1) business day after
deposit with a nationally recognized overnight-guaranteed delivery service; or
(c) when sent by facsimile or electronic mail (provided confirmation of
transmission is received). The addresses for notices are as follows:

         
 
  If to the Majority    
 
  Note Holders:   BlackRock Financial Management, Inc., High Yield Group,
 
      as investment advisor/sub-advisor for certain accounts
 
      40 East 52nd Street
 
      New York, New York 10022 
 
      Facsimile No.: (212) 810-8756 
 
      Attn: Peter Schwartzman
 
       
 
      With a copy to David Maryles, Esq.
 
      Facsimile No.: (212) 810-5116 
 
       
 
      Drawbridge Special Opportunities Advisors LLC,
 
      as agent on behalf of certain funds and accounts
 
      1345 Avenue of the Americas, 46th Floor
 
      New York, New York 10105:
 
      Facsimile No.: (212) 798-6099 
 
      Attn.: Dean Dakolias
 
       
 
      Midland National Life Insurance Company
 
      1888 FUND, LTD.
 
      c/o Guggenheim Partners
 
      135 East 57th Street, 6th Floor
 
      New York, New York 10022 
 
      Facsimile No.: (212) 644-8396 
 
      Attention: Operations Team

 

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      Silver Point Capital Offshore Fund, Ltd.
 
      2 Greenwich Plaza
 
      Greenwich, Connecticut 06830 
 
      Facsimile No.: (203) 542-4162 
 
      Attn.: Benjamin Tecmire
 
      E-mail: creditadmin@silverpointcapital.com
 
       
 
  With a copy to:   Cadwalader, Wickersham & Taft LLP
 
      One World Financial Center
 
      New York, New York 10281
 
      Attn.: Scott J. Greenberg, Esq. and Michael J. Cohen, Esq.
 
      Facsimile No.: (212) 504-6666 
 
       
 
  If to the Issuers    
 
  and Guarantors:   CasaBlanca Resorts
 
      950 West Mesquite Boulevard
 
      Mesquite, Nevada 89027 
 
      Attn: Chief Executive Officer
 
      Facsimile No.: (702) 346-6862 
 
       
 
  With a copy to:   Gordon Silver
 
      3960 Howard Hughes Parkway
 
      9th Floor
 
      Las Vegas, Nevada 89169 
 
      Attn: Gregory E. Garman
 
      Facsimile No.: (702) 369-2666 

Any party may change its address by giving the other parties written notice of
its new address as herein provided.
18. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed in the State of New York, including, without limitation,
Sections 5-1401 and 5-1402 of the New York General Obligations Law and New York
Civil Practice Laws and Rules 327(b); provided that with respect to the
enforcement and remedies relating to the security interest in any real property
Collateral, the governing law may be the laws of the jurisdictions where such
Collateral is located without regard to the conflict of law provisions thereof.
19. Interpretation. The captions of the sections of this Agreement are for
convenience and reference only, and the words contained therein shall in no way
be held to explain, modify, amplify or aid in the interpretation, construction
or meaning of this Agreement. Any pronouns or references used herein shall be
deemed to include the masculine, feminine or neuter genders as appropriate. Any
expression in the singular or the plural shall, if appropriate in the context,
include both the singular and the plural.
20. Severability. If any provision of this Agreement or any provision of the
Loan Documents shall be determined by a court of competent jurisdiction to be
invalid, illegal or unenforceable, that portion shall be deemed severed
therefrom, and the remaining parts shall remain in full force as though the
invalid, illegal or unenforceable portion had never been a part thereof.

 

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21. Successors and Assigns. This Agreement shall be binding upon and shall inure
to the benefit of the parties, their heirs, executors, administrators,
successors and assigns.
22. Fees and Costs. In consideration for the agreement of Majority Note Holders
to forbear as provided in Section 5 hereof, the Issuers hereby acknowledge that
the expenses incurred by the Majority Note Holders in connection with the
preparation and negotiation of this Agreement and any other documents, including
without limitation the reasonable fees of and expenses incurred by their
attorneys and advisors, are expenses that are payable by the Issuers under the
Loan Documents, and the Issuers agree that they shall pay such expenses upon
demand.
23. Professional Fees. Black Gaming hereby acknowledges its obligation to pay
the fees and expenses of Morgan Joseph, as set forth in that certain Letter
Agreement dated as of January 8, 2009 by and between Morgan Joseph and Black
Gaming (the “Morgan Joseph Agreement”), and of CWT, as set forth in that certain
Letter Agreement dated as of October 29, 2008 by and between CWT and Black
Gaming (the “CWT Agreement”), and Black Gaming hereby agrees to continue to pay
such fees and expense in accordance with the terms and conditions of the Morgan
Joseph Agreement and the CWT Agreement during the Forbearance Period.
24. WAIVER OF RIGHT TO JURY TRIAL. EACH OF THE ISSUERS, GUARANTORS AND MAJORITY
NOTE HOLDERS HEREBY VOLUNTARILY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT
TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE, BETWEEN THE MAJORITY NOTE HOLDERS, ISSUERS,
GUARANTORS, OR ANY ONE OR MORE OF THEM, ARISING OUT OF, IN CONNECTION WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THE ISSUERS,
GUARANTORS AND MAJORITY NOTE HOLDERS IN CONNECTION WITH THE LOAN DOCUMENTS, THIS
AGREEMENT, OR ANY OTHER AGREEMENT OR DOCUMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO. THIS PROVISION IS A
MATERIAL INDUCEMENT TO THE MAJORITY NOTE HOLDERS TO ENTER INTO THIS AGREEMENT.
IT SHALL NOT IN ANY WAY AFFECT, WAIVE, LIMIT, AMEND OR MODIFY THE ABILITY OF ANY
OF THE MAJORITY NOTE HOLDERS TO PURSUE ITS RIGHTS AND REMEDIES CONTAINED IN THE
LOAN DOCUMENTS, THIS AGREEMENT, OR ANY OTHER DOCUMENT OR AGREEMENT RELATED
HERETO.
25. No Third Party Beneficiaries. No person other than the parties hereto (and
their respective successors and permitted assigns) shall have any rights
hereunder or be entitled to rely on this Agreement, and all other third-party
beneficiary rights are hereby expressly disclaimed.
26. Counterparts; Facsimile Signatures. This Agreement may be executed in
counterparts, each of which shall be considered an original instrument, but all
of which together shall be considered one and the same agreement. Facsimile
copies of the signature page hereof shall be deemed originals and shall be
binding for all purposes.
27. Effectiveness. This Agreement shall become effective immediately upon the
satisfaction of the following conditions (such date, the “Effective Date”):
(a) Each of the Issuers, the Guarantors and the Majority Note Holders shall have
executed and delivered a copy of this Agreement; and

 

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(b) The execution and delivery of the Amended and Restated Forbearance Agreement
among the Issuers, the Guarantors and Wells Fargo Foothill, Inc. in respect of
the Credit Agreement in form and substance reasonably acceptable to the Majority
Note Holders.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
Execution Date.

         
 
  ISSUERS:    
 
            VIRGIN RIVER CASINO CORPORATION,     a Nevada corporation
 
       
 
  By:   /s/ Robert R. Black, Sr. 
 
       
 
  Printed Name:   Robert R. Black, Sr. 
 
       
 
  Its:   Chief Executive Officer 
 
       
 
            RBG, LLC,     a Nevada limited liability company
 
       
 
  By:   /s/ Robert R. Black, Sr. 
 
       
 
  Printed Name:   Robert R. Black, Sr. 
 
       
 
  Its:   Chief Executive Officer 
 
       
 
            B & BB, INC.,     a Nevada corporation
 
       
 
  By:   /s/ Robert R. Black, Sr. 
 
       
 
  Printed Name:   Robert R. Black, Sr.  
 
       
 
  Its:   Chief Executive Officer 
 
       
 
            GUARANTORS:
 
            CASABLANCA RESORTS, LLC,     a Nevada limited liability company
 
       
 
  By:   /s/ Robert R. Black, Sr. 
 
       
 
  Printed Name:   Robert R. Black, Sr.  
 
       
 
  Its:   Chief Executive Officer 
 
       

 

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              OASIS INTERVAL OWNERSHIP, LLC,     a Nevada limited liability
company
 
       
 
  By:   /s/ Robert R. Black, Sr.  
 
       
 
  Printed Name:   Robert R. Black, Sr.  
 
       
 
  Its:   Chief Executive Officer 
 
       
 
            OASIS INTERVAL MANAGEMENT, LLC,     a Nevada limited liability
company
 
       
 
  By:   /s/ Robert R. Black, Sr.  
 
       
 
  Printed Name:   Robert R. Black, Sr.  
 
       
 
  Its:   Chief Executive Officer 
 
       
 
            OASIS RECREATIONAL PROPERTIES, INC.,     a Nevada corporation
 
       
 
  By:   /s/ Robert R. Black, Sr.  
 
       
 
  Printed Name:   Robert R. Black, Sr.  
 
       
 
  Its:   Chief Executive Officer 
 
       
 
            BLACK GAMING, LLC,     a Nevada limited liability company
 
       
 
  By:   /s/ Robert R. Black, Sr.  
 
       
 
  Printed Name:   Robert R. Black, Sr.  
 
       
 
  Its:   Chief Executive Officer 
 
       
 
            R. BLACK, INC.,     a Nevada corporation
 
       
 
  By:   /s/ Robert R. Black, Sr.  
 
       
 
  Printed Name:   Robert R. Black, Sr.  
 
       
 
  Its:   Chief Executive Officer 
 
       

 

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              MAJORITY NOTE HOLDERS:
 
            BLACKROCK FINANCIAL MANAGEMENT, INC.,     HIGH YIELD GROUP, as
investment     advisors/sub-advisors for certain accounts
 
       
 
  By:   /s/ Kevin J. Booth 
 
       
 
  Printed Name:   Kevin J. Booth 
 
       
 
  Its:   Managing Director 
 
       
 
            DRAWBRIDGE SPECIAL OPPORTUNITIES ADVISORS LLC,     as agent on
behalf of certain funds and accounts
 
       
 
  By:   /s/ Marc K. Furstein 
 
       
 
  Printed Name:   Marc K. Furstein 
 
       
 
  Its:   Chief Operating Officer 
 
       
 
            MIDLAND NATIONAL LIFE INSURANCE COMPANY     By: Guggenheim Partners
Advisory Company, its Agent
 
       
 
  By:   /s/ Michael Damaso 
 
       
 
  Printed Name:   Michael Damaso 
 
       
 
  Its:   Senior Managing Director 
 
       
 
            1888 FUND, LTD.     By: Guggenheim Investment Management, LLC,    
as its Collateral Manager
 
       
 
  By:   /s/ Michael Damaso 
 
       
 
  Printed Name:   Michael Damaso 
 
       
 
  Its:   Senior Managing Director 
 
       
 
            SILVER POINT CAPITAL OFFSHORE FUND, LTD.
 
            By: Silver Point Capital, L.P.,     Its Investment Manager
 
       
 
  By:   /s/ Frederick H. Fogel 
 
       
 
  Printed Name:   Frederick H. Fogel 
 
       
 
  Its:   Authorized Signatory 
 
       

 

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Schedule A
Disclosed Banks

  1.  
Colonial Bank
    2.  
Bank of America
    3.  
Bank of Nevada
    4.  
Wells Fargo