Exhibit 10.4

EXECUTION VERSION

 

 

 

SECOND LIEN CREDIT AGREEMENT

Dated as of October 20, 2017,

among

GOLDEN ENTERTAINMENT, INC.,

as Borrower,

THE SUBSIDIARIES OF BORROWER PARTY HERETO,

as Guarantors,

THE LENDERS PARTY HERETO,

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as Administrative Agent and as Collateral Agent,

 

 

and

JPMORGAN CHASE BANK, N.A., CREDIT SUISSE SECURITIES (USA) LLC,

MACQUARIE CAPITAL (USA) INC. and MORGAN STANLEY SENIOR FUNDING, INC.,

as Lead Arrangers and Bookrunners

 

 

 

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TABLE OF CONTENTS

 

         Page   ARTICLE I.    DEFINITIONS, ACCOUNTING MATTERS AND RULES OF
CONSTRUCTION   

SECTION 1.01.

  Certain Defined Terms      1  

SECTION 1.02.

  Accounting Terms and Determinations      61  

SECTION 1.03.

  Classes and Types of Loans      62  

SECTION 1.04.

  Rules of Construction      62  

SECTION 1.05.

  Pro Forma Calculations      63  

SECTION 1.06.

  Collateral      64  

SECTION 1.07.

  Limited Condition Transactions      64  

SECTION 1.08.

  Ratio Calculations; Negative Covenant Reclassification      65   ARTICLE II.
   CREDITS   

SECTION 2.01.

  Loans      66  

SECTION 2.02.

  Borrowings      67  

SECTION 2.03.

  [Reserved]      67  

SECTION 2.04.

  Termination and Reductions of Commitment      67  

SECTION 2.05.

  Fees      67  

SECTION 2.06.

  Lending Offices      68  

SECTION 2.07.

  Several Obligations of Lenders      68  

SECTION 2.08.

  Notes; Register      68  

SECTION 2.09.

  Optional Prepayments and Conversions or Continuations of Loans      69  

SECTION 2.10.

  Mandatory Prepayments      70  

SECTION 2.11.

  Replacement of Lenders      75  

SECTION 2.12.

  Incremental Loan Commitments      76  

SECTION 2.13.

  Extensions of Loans and Commitments      80  

SECTION 2.14.

  Defaulting Lender Provisions      81  

SECTION 2.15.

  Refinancing Amendments      82   ARTICLE III.    PAYMENTS OF PRINCIPAL AND
INTEREST   

SECTION 3.01.

  Repayment of Loans      83  

SECTION 3.02.

  Interest      84   ARTICLE IV.    PAYMENTS; PRO RATA TREATMENT; COMPUTATIONS;
ETC.   

SECTION 4.01.

  Payments      84  

SECTION 4.02.

  Pro Rata Treatment      85  

SECTION 4.03.

  Computations      85  

SECTION 4.04.

  Minimum Amounts      85  

SECTION 4.05.

  Certain Notices      86  

SECTION 4.06.

  Non-Receipt of Funds by Administrative Agent      87  

SECTION 4.07.

  Right of Setoff, Sharing of Payments; Etc.      87  

 

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         Page   ARTICLE V.    YIELD PROTECTION, ETC.   

SECTION 5.01.

  Increased Costs      88  

SECTION 5.02.

  Inability To Determine Interest Rate      90  

SECTION 5.03.

  Illegality      90  

SECTION 5.04.

  Treatment of Affected Loans      90  

SECTION 5.05.

  Compensation      91  

SECTION 5.06.

  Net Payments      92   ARTICLE VI.    GUARANTEES   

SECTION 6.01.

  The Guarantees      94  

SECTION 6.02.

  Obligations Unconditional      95  

SECTION 6.03.

  Reinstatement      97  

SECTION 6.04.

  Subrogation; Subordination      97  

SECTION 6.05.

  Remedies      97  

SECTION 6.06.

  Continuing Guarantee      98  

SECTION 6.07.

  General Limitation on Guarantee Obligations      98  

SECTION 6.08.

  Release of Guarantors      98  

SECTION 6.09.

  Keepwell      98  

SECTION 6.10.

  Right of Contribution      99   ARTICLE VII.    CONDITIONS PRECEDENT   

SECTION 7.01.

  Conditions to Initial Extensions of Credit      99  

SECTION 7.02.

  Conditions to All Extensions of Credit      103   ARTICLE VIII.   
REPRESENTATIONS AND WARRANTIES   

SECTION 8.01.

  Corporate Existence; Compliance with Law      104  

SECTION 8.02.

  Financial Condition; Etc.      104  

SECTION 8.03.

  Litigation      105  

SECTION 8.04.

  No Breach; No Default      105  

SECTION 8.05.

  Action      105  

SECTION 8.06.

  Approvals      105  

SECTION 8.07.

  ERISA, Foreign Employee Benefit Matters and Labor Matters      106  

SECTION 8.08.

  Taxes      107  

SECTION 8.09.

  Investment Company Act      107  

SECTION 8.10.

  Environmental Matters      107  

SECTION 8.11.

  Use of Proceeds      108  

SECTION 8.12.

  Subsidiaries      109  

SECTION 8.13.

  Ownership of Property; Liens      109  

SECTION 8.14.

  Security Interest; Absence of Financing Statements; Etc.      109  

SECTION 8.15.

  Licenses and Permits      110  

SECTION 8.16.

  Disclosure      110  

SECTION 8.17.

  Solvency      110  

SECTION 8.18.

  Senior Obligations      110  

 

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         Page  

SECTION 8.19.

  Intellectual Property      111  

SECTION 8.20.

  [Reserved]      111  

SECTION 8.21.

  [Reserved]      111  

SECTION 8.22.

  Insurance      111  

SECTION 8.23.

  Real Estate      111  

SECTION 8.24.

  Leases      112  

SECTION 8.25.

  Mortgaged Real Property      112  

SECTION 8.26.

  Material Adverse Effect      112  

SECTION 8.27.

  Anti-Corruption Laws and Sanctions      112   ARTICLE IX.    AFFIRMATIVE
COVENANTS   

SECTION 9.01.

  Existence; Business Properties      113  

SECTION 9.02.

  Insurance      114  

SECTION 9.03.

  Taxes; Performance of Obligations      114  

SECTION 9.04.

  Financial Statements, Etc.      115  

SECTION 9.05.

  Maintaining Records; Access to Properties and Inspections      118  

SECTION 9.06.

  Use of Proceeds      118  

SECTION 9.07.

  Compliance with Environmental Law      119  

SECTION 9.08.

  Pledge or Mortgage of Real Property and Vessels      119  

SECTION 9.09.

  Security Interests; Further Assurances      122  

SECTION 9.10.

  [Reserved]      123  

SECTION 9.11.

  Additional Credit Parties      123  

SECTION 9.12.

  Limitation on Designations of Unrestricted Subsidiaries      124  

SECTION 9.13.

  Limitation on Designation of Immaterial Subsidiaries      125  

SECTION 9.14.

  Ratings      125  

SECTION 9.15.

  Post-Closing Matters      125  

SECTION 9.16.

  Title Insurance      126   ARTICLE X.    NEGATIVE COVENANTS   

SECTION 10.01.

  Indebtedness      127  

SECTION 10.02.

  Liens      131  

SECTION 10.03.

  [Reserved]      135  

SECTION 10.04.

  Investments, Loans and Advances      135  

SECTION 10.05.

  Mergers, Consolidations and Sales of Assets      138  

SECTION 10.06.

  Restricted Payments      141  

SECTION 10.07.

  Transactions with Affiliates      143  

SECTION 10.08.

  [Reserved]      144  

SECTION 10.09.

  Certain Payments of Indebtedness; Amendments to Certain Agreements      144  

SECTION 10.10.

  Limitation on Certain Restrictions Affecting Subsidiaries      145  

SECTION 10.11.

  Limitation on Lines of Business      147  

SECTION 10.12.

  Limitation on Changes to Fiscal Year      147   ARTICLE XI.    EVENTS OF
DEFAULT   

SECTION 11.01.

  Events of Default      147  

SECTION 11.02.

  Application of Proceeds      150  

 

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         Page   ARTICLE XII.    AGENTS   

SECTION 12.01.

  Appointment      151  

SECTION 12.02.

  Rights as a Lender      151  

SECTION 12.03.

  Exculpatory Provisions      151  

SECTION 12.04.

  Reliance by Agents      153  

SECTION 12.05.

  Delegation of Duties      153  

SECTION 12.06.

  Resignation of Administrative Agent and Collateral Agent      153  

SECTION 12.07.

  Nonreliance on Agents and Other Lenders      154  

SECTION 12.08.

  Indemnification      155  

SECTION 12.09.

  No Other Duties      155  

SECTION 12.10.

  Holders      155  

SECTION 12.11.

  Administrative Agent May File Proofs of Claim      155  

SECTION 12.12.

  Collateral Matters      156  

SECTION 12.13.

  Withholding Tax      157   ARTICLE XIII.    MISCELLANEOUS   

SECTION 13.01.

  Waiver      157  

SECTION 13.02.

  Notices      157  

SECTION 13.03.

  Expenses, Indemnification, Etc.      159  

SECTION 13.04.

  Amendments and Waiver      161  

SECTION 13.05.

  Benefit of Agreement; Assignments; Participations      167  

SECTION 13.06.

  Survival      173  

SECTION 13.07.

  Captions      173  

SECTION 13.08.

  Counterparts; Interpretation; Effectiveness      173  

SECTION 13.09.

  Governing Law; Submission to Jurisdiction; Waivers; Etc.      174  

SECTION 13.10.

  Confidentiality      175  

SECTION 13.11.

  Independence of Representations, Warranties and Covenants      175  

SECTION 13.12.

  Severability      176  

SECTION 13.13.

  Gaming Laws      176  

SECTION 13.14.

  USA Patriot Act      176  

SECTION 13.15.

  Waiver of Claims      176  

SECTION 13.16.

  No Advisory or Fiduciary Responsibility      177  

SECTION 13.17.

  Lender Action      177  

SECTION 13.18.

  Interest Rate Limitation      178  

SECTION 13.19.

  Payments Set Aside      178  

SECTION 13.20.

  Acknowledgement and Consent to Bail-In of EEA Financial Institutions      179
 

 

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ANNEXES:      

ANNEX A

   -      Term B Facility Commitments SCHEDULES:      

SCHEDULE 1.01(A)

   -      Excluded Subsidiary Agreements

SCHEDULE 1.01(B)

   -      Guarantors

SCHEDULE 1.01(C)

   -      Mortgaged Real Property

SCHEDULE 7.01

   -      Jurisdictions of Local Counsel Opinions

SCHEDULE 8.03

   -      Litigation

SCHEDULE 8.07

   -      ERISA

SCHEDULE 8.10

   -      Environmental Matters

SCHEDULE 8.12(a)

   -      Subsidiaries

SCHEDULE 8.12(b)

   -      Immaterial Subsidiaries

SCHEDULE 8.12(c)

   -      Unrestricted Subsidiaries

SCHEDULE 8.13(a)

   -      Ownership

SCHEDULE 8.15

   -      Licenses and Permits

SCHEDULE 8.19

   -      Intellectual Property

SCHEDULE 8.23(a)

   -      Real Property

SCHEDULE 8.23(b)

   -      Real Property Takings, Etc.

SCHEDULE 8.25(a)

   -      No Certificates of Occupancy; Violations, Etc.

SCHEDULE 8.25(b)

   -      Encroachment, Boundary, Location, Possession Disputes

SCHEDULE 9.12

   -      Designated Unrestricted Subsidiaries

SCHEDULE 9.15

   -      Post-Closing Matters

SCHEDULE 10.01

   -      Existing Indebtedness

SCHEDULE 10.02

   -      Certain Existing Liens

SCHEDULE 10.04

   -      Investments

SCHEDULE 10.04(aa)

   -      Specified Land

SCHEDULE 10.07

   -      Transactions with Affiliates EXHIBITS:      

EXHIBIT A

   -      Form of Term B Facility Note

EXHIBIT B

   -      Form of Notice of Borrowing

EXHIBIT C

   -      Form of Notice of Continuation/Conversion

EXHIBIT D

   -      Forms of U.S. Tax Compliance Certificate

EXHIBIT E

   -      [Reserved]

EXHIBIT F

   -      [Reserved]

EXHIBIT G

   -      Form of Solvency Certificate

EXHIBIT H

   -      Form of Security Agreement

EXHIBIT I

   -      Form of Mortgage

EXHIBIT J

   -      Form of Affiliated Lender Assignment and Assumption

EXHIBIT K

   -      Form of Assignment and Assumption Agreement

EXHIBIT L

   -      [Reserved]

EXHIBIT M

   -      Form of Joinder Agreement

EXHIBIT N

   -      Form of Perfection Certificate

EXHIBIT O

   -      Form of Auction Procedures

EXHIBIT P

   -      Form of Open Market Assignment and Assumption Agreement

 

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EXHIBIT Q

   -     

Form of Term Loan Extension Amendment

EXHIBIT R

   -     

[Reserved]

EXHIBIT S

   -     

Form of Pari Passu Intercreditor Agreement

EXHIBIT T

   -     

Form of Second Lien Intercreditor Agreement

EXHIBIT U

   -     

Form of Custodian Agreement

EXHIBIT V

   -     

Form of Compliance Certificate

 

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SECOND LIEN CREDIT AGREEMENT, dated as of October 20, 2017 (this “Agreement”),
among GOLDEN ENTERTAINMENT, INC., a Minnesota corporation (“Borrower”); the
SUBSIDIARY GUARANTORS party hereto from time to time; the LENDERS from time to
time party hereto; CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as administrative
agent (in such capacity, together with its successors in such capacity,
“Administrative Agent”); and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as
collateral agent (in such capacity, together with its successors in such
capacity, “Collateral Agent”).

WHEREAS, Borrower has requested that the Lenders provide second lien term loan
facilities, and the Lenders have indicated their willingness to lend on the
terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties agree as follows:

ARTICLE I.

DEFINITIONS, ACCOUNTING MATTERS AND RULES OF CONSTRUCTION

SECTION 1.01. Certain Defined Terms. As used herein, the following terms shall
have the following meanings:

“ABR Loans” shall mean Loans that bear interest at rates based upon the
Alternate Base Rate.

“Acquisition” shall mean, with respect to any Person, any transaction or series
of related transactions for the (a) acquisition of all or substantially all of
the Property of any other Person, or of any business or division of any other
Person (other than any then-existing Company), (b) acquisition of more than 50%
of the Equity Interests of any other Person, or otherwise causing any other
Person to become a Subsidiary of such Person or (c) merger or consolidation of
such Person or any other combination of such Person with any other Person (other
than any of the foregoing between or among any then-existing Companies).

“Act” has the meaning set forth in Section 13.14.

“Additional Credit Party” has the meaning set forth in Section 9.11.

“Adjusted Maximum Amount” has the meaning set forth in Section 6.10.

“Administrative Agent” has the meaning set forth in the introductory paragraph
hereof.

“Affected Classes” has the meaning set forth in Section 13.04(b)(A).

“Affiliate” shall mean, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified; provided
that as to any Credit Party or any Subsidiary thereof, the term “Affiliate”
shall expressly exclude the Persons constituting Lenders as of the Closing Date
and their respective Affiliates (determined as provided herein without regard to
this proviso). “Control” shall mean the possession, directly or indirectly, of
the power to (x) vote more than fifty percent (50%) (or, for purposes of
Section 10.07 and the definition of Golden Permitted Assignee, ten percent
(10%)) of the outstanding voting interests of a Person or (y) direct or cause
the direction of the management or policies of a Person,

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whether through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

“Affiliated Lender” shall mean a Lender that is a Golden Permitted Assignee
other than any Debt Fund Affiliate.

“Affiliated Lender Assignment and Assumption” has the meaning set forth in
Section 13.05(e).

“Affiliated Lender Cap” has the meaning set forth in Section 13.05(e).

“Agent” shall mean any of Administrative Agent, Auction Manager, Collateral
Agent, and/or Lead Arrangers, as applicable.

“Agent Party” has the meaning set forth in Section 13.02(e).

“Agent Related Parties” shall mean each Agent and any sub-agent thereof and
their respective Affiliates, directors, officers, employees, agents and
advisors.

“Agreement” has the meaning set forth in the introductory paragraph hereof.

“All-In Yield” shall mean, as to any Indebtedness, the yield thereof, whether in
the form of interest rate, margin, original issue discount, upfront fees, a LIBO
Rate floor (to the extent the LIBO Rate floor applicable to the applicable
Indebtedness is greater than the LIBO Rate floor for the Term B Facility and is
in excess of the three-month LIBO Rate at the time of incurrence of such
Indebtedness) or Alternate Base Rate floor (to the extent the Alternate Base
Rate floor applicable to the applicable Indebtedness is greater than the
Alternate Base Rate floor for the Term B Facility and is in excess of the
Alternate Base Rate at the time of incurrence of such Indebtedness) or
otherwise, in each case, incurred or payable by Borrower generally to all
lenders of such Indebtedness; provided that original issue discount and upfront
fees shall be equated to interest rate assuming a 4-year life to maturity (or,
if less, the stated life to maturity at the time of incurrence of the applicable
Indebtedness); provided, further, that “All-In Yield” shall not include
arrangement, structuring, commitment, underwriting, amendment or other similar
fees (regardless of whether paid or shared in whole or in part to any or all
lenders) or other fees not paid generally to all lenders of such Indebtedness;
provided, further, that “All-In Yield” shall include any amendment to the
relevant interest rate margins and interest rate floors that became effective
after the Closing Date but prior to the applicable date of determination. For
the purposes of determining the All-In Yield of any fixed-rate Indebtedness, at
Borrower’s option, such Indebtedness be swapped to a floating rate on a
customary matched maturity basis.

“Alternate Base Rate” shall mean, for any day, a rate per annum equal to the
greatest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in
effect on such day plus  1⁄2 of 1% and (c) the LIBO Rate for a one month
Interest Period beginning on such day (or if such day is not a Business Day, the
immediately preceding Business Day) plus 1.0%; provided that, the LIBO Rate for
any day shall be based on the LIBO Rate at approximately 11:00 a.m. London time
on such day; provided, further, that with respect to the Term B Facility Loans
only, the Alternate Base Rate shall not be less than 1.75%. Any change in the
Alternate Base Rate due to a change in the Prime Rate, the NYFRB Rate or the
LIBO Rate shall be effective from and including the effective date of such
change in the Prime Rate, the NYFRB Rate or the LIBO Rate, respectively.

“Anti-Corruption Laws” shall mean the United States Foreign Corrupt Practices
Act of 1977, as amended, the UK Bribery Act 2010, as amended, and all other
laws, rules, and regulations of any

 

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jurisdiction applicable to Borrower or any of its Subsidiaries from time to time
concerning or relating to bribery or corruption.

“Applicable ECF Percentage” shall mean, for any fiscal year, commencing with the
fiscal year ended December 31, 2018, (a) 50% if the Consolidated Total Net
Leverage Ratio as of the last day of such fiscal year is greater than 5.10 to
1.00, (b) 25% if the Consolidated Total Net Leverage Ratio as of the last day of
such fiscal year is equal to or less than 5.10 to 1.00 and greater than 4.60 to
1.00 and (c) 0% if the Consolidated Total Net Leverage Ratio as of the last day
of such fiscal year is equal to or less than 4.60 to 1.00.

“Applicable Lending Office” shall mean, for each Lender and for each Type of
Loan, the “Lending Office” of such Lender (or of an Affiliate of such
Lender) (a) that is a lender on the Closing Date, designated for such Type of
Loan on Annex A hereof, (b) set forth on such Lender’s signature page to an
Incremental Joinder Agreement for any Lender making any Incremental Commitment
pursuant to Section 2.12, (c) set forth on such Lender’s signature page to any
Refinancing Amendment for any Lender providing Credit Agreement Refinancing
Indebtedness pursuant to Section 2.15, (d) set forth in the Assignment Agreement
for any Person that becomes a “Lender” hereunder pursuant to an Assignment
Agreement or (e) such other office of such Lender (or of an Affiliate of such
Lender) as such Lender may from time to time specify to Administrative Agent and
Borrower as the office by which its Loans of such Type are to be made and
maintained.

“Applicable Margin” shall mean, for each Term B Facility Loan, (i) 7.00% per
annum, with respect to LIBOR Loans and (ii) 6.00% per annum, with respect to ABR
Loans.

“Approved Fund” shall mean any Fund that is administered, advised or managed by
(a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of
an entity that administers, advises or manages a Lender.

“Asset Sale” shall mean (a) any conveyance, sale, lease, transfer or other
disposition (including by way of merger or consolidation and including any sale
and leaseback transaction) of any Property (including accounts receivable and
Equity Interests of any Person owned by Borrower or any of its Restricted
Subsidiaries but not any Equity Issuance) (whether owned on the Closing Date or
thereafter acquired) by Borrower or any of its Restricted Subsidiaries to any
Person (other than (i) with respect to any Credit Party, to any Credit Party,
and (ii) with respect to any other Company, to any Company) and (b) any issuance
or sale by any Restricted Subsidiary of its Equity Interests to any Person
(other than to Borrower or any other Restricted Subsidiary); provided that the
following shall not constitute an “Asset Sale”: (v) any conveyance, sale, lease,
transfer or other disposition of inventory, in any case in the ordinary course
of business, (w) Real Property leases and other leases, licenses, subleases or
sublicenses, in each case, granted to others in the ordinary course of business
and which do not materially interfere with the business of Borrower and the
Restricted Subsidiaries taken as a whole, (x) any conveyance, sale, lease,
transfer or other disposition of obsolete or worn out assets or assets no longer
useful in the business of the Credit Parties, (y) licenses of Intellectual
Property entered into in the ordinary course of business and (z) any conveyance,
sale, transfer or other disposition of cash and/or Cash Equivalents.

“Assignment Agreement” shall mean an Assignment and Assumption Agreement
substantially in the form attached as Exhibit K hereto.

“Auction Amount” shall have the meaning provided in Exhibit O hereto.

 

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“Auction Manager” shall mean Credit Suisse, or another financial institution as
shall be selected by Borrower in a written notice to Administrative Agent, in
each case in its capacity as Auction Manager.

“Auction Procedures” shall mean, collectively, the auction procedures, auction
notice, return bid and Borrower Assignment Agreement in substantially the form
set forth as Exhibit O hereto or such other form as is reasonably acceptable to
Auction Manager and Borrower so long as the same are consistent with the
provisions hereof; provided, however, Auction Manager, with the prior written
consent of Borrower, may amend or modify the procedures, notices, bids and
Borrower Assignment Agreement in connection with any Borrower Loan Purchase (but
excluding economic terms of a particular auction after any Lender has validly
tendered Term Loans requested in an offer relating to such auction, other than
to increase the Auction Amount or raise the Discount Range applicable to such
auction); provided, further, that no such amendments or modifications may be
implemented after 24 hours prior to the date and time return bids are due in
such auction.

“Available Amount” shall mean, on any date, an amount not less than zero, equal
to:

(a) the greater of $35,000,000 and 20% of Consolidated EBITDA at the time of
determination for the Test Period most recently ended prior to such date; plus

(b) 50.0% of the aggregate amount of Consolidated Net Income for the period
(taken as one accounting period) commencing from the first day of the fiscal
quarter of Borrower in which the Closing Date occurs to the end of the most
recent fiscal quarter of Borrower prior to such date with respect to which
internal financial statements are available (which amount shall not be
negative); plus

(c) in the event of (i) the Revocation of a Subsidiary that was designated as an
Unrestricted Subsidiary, (ii) the merger, consolidation or amalgamation of an
Unrestricted Subsidiary with or into Borrower or a Restricted Subsidiary (where
the surviving entity is Borrower or a Restricted Subsidiary) or (iii) the
transfer or other conveyance of assets of an Unrestricted Subsidiary to, or
liquidation of an Unrestricted Subsidiary into, Borrower or a Restricted
Subsidiary, an amount equal to the sum of (x) the fair market value of the
Investments deemed made by Borrower and its Restricted Subsidiaries in such
Unrestricted Subsidiary at the time such Subsidiary was designated as an
Unrestricted Subsidiary, plus (y) the amount of the Investments of Borrower and
its Restricted Subsidiaries in such Unrestricted Subsidiary made after such
designation and prior to the time of such Revocation, merger, consolidation,
amalgamation, conveyance or transfer (or of the assets transferred or conveyed,
as applicable), other than, in the case of this clause (y), to the extent such
Investments funded Investments by such Unrestricted Subsidiary into a Person
that, after giving effect to the transaction described in clauses (i), (ii) or
(iii) above, will be an Unrestricted Subsidiary, in each case, to the extent
such Investments were made in reliance on the Available Amount; provided, that
clauses (x) and (y) shall not be duplicative of any reductions in the amount of
such Investments pursuant to the proviso to the definition of “Investments”;
plus

(d) an amount equal to the returns or refunds of Qualifying Investments
(excluding (i) any interest, earnings, returns or other gains in respect of such
Qualifying Investments determined in the manner set forth in Section 1.02(b) and
(ii) Specified 10.04(k) Investment Returns) received by Borrower and its
Restricted Subsidiaries from Persons other than Credit Parties after the Closing
Date to the extent not included in Consolidated Net Income; plus

(e) the aggregate amount of Equity Issuance Proceeds (including upon conversion
or exchange of a debt instrument or Disqualified Capital Stock into or for any
Equity Interests (other than Disqualified Capital Stock) but excluding Excluded
Contributions) received by Borrower from

 

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Permitted Equity Issuances (other than Permitted Equity Issuances pursuant to
Section 11.03 of the First Lien Credit Agreement) after the Closing Date and on
or prior to such date; plus

(f) the aggregate fair market value of assets or Property acquired in exchange
for Equity Interests (other than Disqualified Capital Stock) of Borrower (other
than Permitted Equity Issuances pursuant to Section 11.03 of the First Lien
Credit Agreement) after the Closing Date and on or prior to such date; plus

(g) the aggregate principal amount of debt instruments or Disqualified Capital
Stock issued after the Closing Date that are converted into or exchanged for any
Equity Interests (other than Disqualified Capital Stock) by Borrower after the
Closing Date and on or prior to such date, together with the fair market value
of any assets or Property received in such conversion or exchange; plus

(h) the amount of any Declined Amounts; minus

(i) the aggregate amount of any (i) Investments made pursuant to
Section 10.04(l), (ii) Restricted Payments made pursuant to Section 10.06(j) and
(iii) Junior Prepayments pursuant to Section 10.09(a)(ii) (in each case, in
reliance on the then-outstanding Available Amount) made since the Closing Date
and on or prior to such date.

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers
by the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

“Bail-In Legislation” shall mean, with respect to any EEA Member Country
implementing Article 55 of Directive 2014/59/EU of the European Parliament and
of the Council of the European Union, the implementing law for such EEA Member
Country from time to time which is described in the EU Bail-In Legislation
Schedule.

“Bankruptcy Code” shall mean the Title 11 of the United States Code entitled
“Bankruptcy,” as now or hereinafter in effect, or any successor statute thereto.

“Borrower” has the meaning set forth in the introductory paragraph hereof.

“Borrower Assignment Agreement” shall mean, with respect to any assignment to
Borrower or one of its Subsidiaries pursuant to Section 13.05(d) consummated
pursuant to the Auction Procedures, an Assignment and Acceptance Agreement
substantially in the form of Annex C to the Auction Procedures (as may be
modified from time to time as set forth in the definition of Auction
Procedures).

“Borrower Loan Purchase” shall mean any purchase of Term Loans by Borrower or
one of its Subsidiaries pursuant to Section 13.05(d).

“Borrower Materials” has the meaning set forth in Section 9.04.

“Borrowing” shall mean Loans of the same Class and Type made, converted or
continued on the same date and, in the case of LIBOR Loans, as to which a single
Interest Period is in effect.

“Business Day” shall mean any day, except a Saturday or Sunday, (a) on which
commercial banks are not authorized or required to close in New York and (b) if
such day relates to a borrowing of, a payment or prepayment of principal of or
interest on, a continuation or conversion of or into, or an Interest Period for,
a LIBOR Loan or a notice by Borrower with respect to any such borrowing,
payment,

 

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prepayment, continuation, conversion or Interest Period, that is also a day on
which dealings in Dollar deposits are carried out in the London interbank
market.

“Calculation Date” shall mean the last day of the most recent Test Period.

“Capital Expenditures” shall mean, for any period any expenditures by Borrower
or its Restricted Subsidiaries for the acquisition or leasing of fixed or
capital assets (including Capital Lease Obligations) that should be capitalized
in accordance with GAAP and any expenditures by such Person for maintenance,
repairs, restoration or refurbishment of the condition or usefulness of Property
of such Person that should be capitalized in accordance with GAAP; provided that
the following items shall not constitute Capital Expenditures: (a) expenditures
made in connection with the replacement, substitution, restoration or repair of
assets to the extent financed with (x) insurance proceeds paid on account of the
loss of or damage to the assets being replaced, restored or repaired or
(y) awards of compensation arising from the taking by eminent domain or
condemnation (or transfers in lieu thereof) of the assets being replaced;
(b) the purchase price of assets purchased simultaneously with the trade-in of
existing assets solely to the extent that the gross amount of such purchase
price is reduced by the credit granted by the seller of such assets for the
asset being traded in at such time; (c) the purchase of property or equipment to
the extent financed with the proceeds of asset sales or other dispositions
outside the ordinary course of business that are not required to be applied to
prepay the Term Loans pursuant to Section 2.10(a)(iii); (d) expenditures that
constitute Permitted Acquisitions or other Acquisitions not prohibited
hereunder; (e) any capitalized interest expense reflected as additions to
property in the consolidated balance sheet of Borrower and its Restricted
Subsidiaries (including in connection with sale-leaseback transactions not
prohibited hereunder); (f) any non-cash compensation or other non-cash costs
reflected as additions to property in the consolidated balance sheet of Borrower
and its Restricted Subsidiaries; and (g) capital expenditures relating to the
construction or acquisition of any property or equipment which has been
transferred to a Person other than Borrower or any of its Restricted
Subsidiaries pursuant to a sale-leaseback transaction not prohibited hereunder
and capital expenditures arising pursuant to sale-leaseback transactions.

“Capital Lease” as applied to any Person, shall mean any lease of any Property
by that Person as lessee that, in conformity with GAAP, is required to be
classified and accounted for as a capital lease on the balance sheet of that
Person; provided, however, that for the avoidance of doubt, any lease that is
accounted for by any Person as an operating lease as of the Closing Date and any
similar lease entered into after the Closing Date by any Person may, in the sole
discretion of Borrower, be accounted for as an operating lease and not as a
Capital Lease.

“Capital Lease Obligations” shall mean, for any Person, all obligations of such
Person to pay rent or other amounts under a Capital Lease, and, for purposes of
this Agreement, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP; provided, however, that for the
avoidance of doubt, any lease that is accounted for by any Person as an
operating lease as of the Closing Date and any similar lease entered into after
the Closing Date by any Person may, in the sole discretion of Borrower, be
accounted for as an operating lease and not as a Capital Lease.

“Cash Equivalents” shall mean, for any Person: (a) direct obligations of the
United States, or of any agency thereof, or obligations guaranteed as to
principal and interest by the United States, or by any agency thereof, in either
case maturing not more than one year from the date of acquisition thereof by
such Person; (b) time deposits, certificates of deposit or bankers’ acceptances
(including eurodollar deposits) issued by (i) any bank or trust company
organized under the laws of the United States or any state thereof and having
capital, surplus and undivided profits of at least $500.0 million that is
assigned at least a “B” rating by Thomson Financial BankWatch or (ii) any Lender
or bank holding company owning

 

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any Lender (in each case, at the time of acquisition); (c) commercial paper
maturing not more than one year from the date of acquisition thereof by such
Person and (i) issued by any Lender or bank holding company owning any Lender or
(ii) rated at least “A-2” or the equivalent thereof by S&P or at least “P-2” or
the equivalent thereof by Moody’s, respectively, (in each case, at the time of
acquisition); (d) repurchase obligations with a term of not more than thirty
(30) days for underlying securities of the types described in clause (a) above
or (e) below entered into with a bank meeting the qualifications described in
clause (b) above (in each case, at the time of acquisition); (e) securities with
maturities of one year or less from the date of acquisition issued or fully
guaranteed by any state, commonwealth or territory of the United States, or by
any political subdivision or taxing authority thereof or by any foreign
government, and rated at least “A” by S&P or “A” by Moody’s (in each case, at
the time of acquisition); (f) securities with maturities of six months or less
from the date of acquisition backed by standby letters of credit issued by any
Lender or any commercial bank satisfying the requirements of clause (b) above
(in each case, at the time of acquisition); (g) money market mutual funds that
invest primarily in the foregoing items (determined at the time such investment
in such fund is made); (h) solely with respect to any Foreign Subsidiary,
(i) marketable direct obligations issued by, or unconditionally guaranteed by,
the country in which such Foreign Subsidiary maintains its chief executive
office or principal place of business, or issued by any agency of such country
and backed by the full faith and credit of such country, and rated at least “A”
or the equivalent thereof by S&P or “A2” or the equivalent thereof by Moody’s
(in each case, at the time of acquisition), (ii) time deposits, certificates of
deposit or bankers’ acceptances issued by any commercial bank which is organized
and existing under the laws of the country in which such Foreign Subsidiary
maintains its chief executive office and principal place of business, or payable
to a Company promptly following demand and maturing within one year of the date
of acquisition and (iii) other customarily utilized high-quality or cash
equivalent-type Investments in the country where such Foreign Subsidiary
maintains its chief executive office or principal place of business; (i) such
local currencies held by Borrower or any Restricted Subsidiary from time to time
in the ordinary course of business; or (j) investment funds investing at least
90% of their assets in securities of the types described in clauses (a) through
(i) above.

“Cash Management Agreement” shall mean any agreement to provide cash management
services, including treasury, depository, overdraft, credit or debit card,
electronic funds transfer and other cash management arrangements.

“Cash Management Bank” shall mean (a) any Person that is a party to a Cash
Management Agreement with Borrower and/or any of its Restricted Subsidiaries if
such Person was, at the date of entering into such Cash Management Agreement, an
Agent, a Lender or an Affiliate of an Agent or a Lender and (b) any Person that
is a party to a Cash Management Agreement with Borrower and/or any of its
Restricted Subsidiaries that was in effect on the Closing Date, if such Person
becomes an Agent, a Lender or an Affiliate of an Agent or a Lender within thirty
(30) days of the Closing Date, and in the case of each of clauses (a) and (b),
such Person executes and delivers to Administrative Agent a letter agreement in
form and substance reasonably acceptable to Administrative Agent pursuant to
which such Person (i) appoints Collateral Agent as its agent under the
applicable Credit Documents and (ii) agrees to be bound by the provisions of
Section 12.03.

“Casualty Event” shall mean any loss of title or any loss of or damage to or
destruction of, or any condemnation or other taking (or settlement in lieu
thereof) (including by any Governmental Authority) of, any Property. “Casualty
Event” shall include, but not be limited to, any taking of all or any part of
any Real Property of Borrower or any of its Restricted Subsidiaries or any part
thereof, in or by condemnation or other eminent domain proceedings pursuant to
any Law (or settlement in lieu thereof), or by reason of the temporary
requisition of the use or occupancy of all or any part of any Real Property

 

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of Borrower or any of its Restricted Subsidiaries or any part thereof by any
Governmental Authority, civil or military.

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended, 42 U.S.C. § 9601 et seq.

“CFC” shall mean a “controlled foreign corporation” within the meaning of
Section 957 of the Code.

“CFC Holdco” shall mean any Subsidiary that has no material assets other than
Equity Interests (or Equity Interests and Indebtedness) of one or more
Subsidiaries of the Borrower that are CFCs.

“Change in Law” shall mean the occurrence, after the date of this Agreement, of
any of the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation, implementation or application thereof by
any Governmental Authority or (c) the making or issuance of any request, rule,
guideline or directive (whether or not having the force of law) by any
Governmental Authority; provided that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, guidelines or directives thereunder or issued in connection
therewith and (y) all requests, rules, guidelines or directives promulgated by
the Bank for International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed to be a “Change in Law”, regardless of the date enacted,
adopted or issued.

“Change of Control” shall be deemed to have occurred if:

(a) any “Person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Exchange Act (but excluding (i) any employee benefit plan of such Person
or its subsidiaries, any Person or entity acting in its capacity as trustee,
agent or other fiduciary or administrator of any such plan, or any Person formed
as a holding company for Borrower (in a transaction where the Voting Stock of
Borrower outstanding prior to such transaction is converted into or exchanged
for the Voting Stock of the surviving or transferee Person constituting all or
substantially all of the outstanding shares of such Voting Stock of such
surviving or transferee Person (immediately after giving effect to such
issuance)), (ii) any Person that has received Voting Stock of Borrower in
consideration of any acquisition or Investment, whether by purchase, merger,
consolidation or otherwise, by Borrower or any of its Subsidiaries, which Person
is temporarily holding such Voting Stock pending distribution to other Persons
(so long as, immediately after giving effect to such distribution, no Change of
Control shall otherwise have occurred) and (iii) the Permitted Holders)),
becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), except that a Person or group shall be deemed to have “beneficial
ownership” of all securities that such Person or group has the right to acquire,
whether such right is exercisable immediately or only after the passage of time
(such right, an “option right”)), directly or indirectly, of Voting Stock
representing more than 50% of the voting power of the total outstanding Voting
Stock of Borrower (and taking into account all such securities that such
“Person” or “group” has the right to acquire pursuant to any option right); or

(b) there shall have occurred any “change of control” (or any comparable term)
in any document pertaining to (x) the First Lien Term Loans, or (y) any other
Indebtedness of Borrower or any Restricted Subsidiary constituting Material
Indebtedness.

 

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“Charges” has the meaning set forth in Section 13.18.

“Class” has the meaning set forth in Section 1.03.

“Closing Date” shall mean the date on which the initial extension of credit is
made hereunder, which date is October 20, 2017.

“Closing Date First Lien Term Loans” shall mean the term loans made by the First
Lien Lenders on the Closing Date to Borrower pursuant to the First Lien Credit
Agreement.

“Closing Date Refinancing” shall mean the repayment and replacement of all loans
and commitments under the Existing Credit Agreements.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Collateral” shall mean all of the Pledged Collateral, the Mortgaged Real
Property, the Mortgaged Vessels (if any), all Property encumbered pursuant to
Sections 9.08, 9.11 and 9.15, and all other Property of a Credit Party whether
now owned or hereafter acquired, upon which a Lien securing the Obligations is
granted or purported to be granted under any Security Document. “Collateral”
shall not include any assets or Property that has been released (in accordance
with the Credit Documents) from the Lien granted to Collateral Agent pursuant to
the Security Documents, unless and until such time as such assets or Property
are or are required by the Credit Documents to again become subject to a Lien in
favor of Collateral Agent.

“Collateral Account” shall mean (a) a Deposit Account (as defined in the UCC) of
Borrower with respect to which Collateral Agent has “control” (as defined in
Section 9-104 of the UCC) or (b) a Securities Account (as defined in the UCC) of
Borrower with respect to which Collateral Agent has “control” (as defined in
Section 9-106 of the UCC).

“Collateral Agent” has the meaning set forth in the introductory paragraph
hereof.

“Commitment Letter” shall mean (i) the Commitment Letter, dated as of June 10,
2017, among Borrower and the Lead Arrangers and (ii) the Fee Letter (as defined
in the Commitment Letter).

“Commitments” shall mean the Term Loan Commitments, any Other Term Loan
Commitments and any New Term Loan Commitments.

“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et
seq.), as amended from time to time, and any successor statute.

“Companies” shall mean Borrower and its Subsidiaries; and “Company” shall mean
any one of them.

“Consolidated Current Assets” shall mean, with respect to any Person at any
date, the total consolidated current assets of such Person and its Subsidiaries
(other than Unrestricted Subsidiaries) that would, in accordance with GAAP, be
classified as current assets on a consolidated balance sheet of such Person and
its Subsidiaries (other than Unrestricted Subsidiaries), other than (x) cash and
Cash Equivalents and (y) the current portion of deferred income tax assets.

 

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“Consolidated Current Liabilities” shall mean, with respect to any Person at any
date, all liabilities of such Person and its Subsidiaries (other than
Unrestricted Subsidiaries) at such date that would, in accordance with GAAP, be
classified as current liabilities on a consolidated balance sheet of such Person
and its Subsidiaries (other than Unrestricted Subsidiaries), other than (x) the
current portion of any Indebtedness and (y) the current portion of deferred
income taxes.

“Consolidated EBITDA” shall mean, for any Test Period, the sum (without
duplication) of Consolidated Net Income for such Test Period; plus

(a) in each case to the extent deducted in calculating such Consolidated Net
Income:

(i) provisions for taxes based on income or profits or capital gains, plus
franchise or similar taxes, of Borrower and its Restricted Subsidiaries for such
Test Period;

(ii) Consolidated Interest Expense (net of interest income (other than interest
income in respect of notes receivable and similar items)) of Borrower and its
Restricted Subsidiaries for such Test Period, whether paid or accrued and
whether or not capitalized;

(iii) any cost, charge, fee or expense (including discounts and commissions and
including fees and charges incurred in respect of letters of credit or bankers
acceptance financings) (or any amortization of any of the foregoing) associated
with any issuance (or proposed issuance) of debt, or equity or any refinancing
transaction (or proposed refinancing transaction) or any amendment or other
modification of any debt instrument;

(iv) depreciation and amortization (including amortization of goodwill and other
intangibles but excluding amortization of prepaid cash expenses that were paid
in a prior Test Period);

(v) any Pre-Opening Expenses;

(vi) the amount of any restructuring costs, charges, accruals, expenses or
reserves (including those relating to severance, relocation costs and one-time
compensation charges), costs incurred in connection with any non-recurring
strategic initiatives, other business optimization expenses (including incentive
costs and expenses relating to business optimization programs and signing,
retention and completion bonuses) (other than to the extent such items represent
the reversal of any accrual or reserve added back in a prior period);

(vii) any unusual or non-recurring costs, charges, accruals, reserves or items
of loss or expense (including, without limitation, losses on asset sales (other
than asset sales in the ordinary course of business)) (other than to the extent
such items represent the reversal of any accrual or reserve added back in a
prior period);

(viii) any charges, fees and expenses (or any amortization thereof) (including,
without limitation, all legal, accounting, advisory or other transaction-related
fees, charges, costs and expenses and any bonuses or success fee payments
related to the Transactions) related to the Transactions, any Permitted
Acquisition or Investment (including any other Acquisition) or disposition (or
any such proposed acquisition, Investment or disposition) (including
amortization or write offs of debt issuance or deferred financing costs,
premiums and prepayment penalties), in each case, whether or not successful;

 

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(ix) any losses resulting from mark to market accounting of Swap Contracts or
other derivative instruments;

(x) to the extent included in calculating such Consolidated Net Income, non-cash
items decreasing such Consolidated Net Income for such Test Period, other than
the accrual of revenue in the ordinary course of business, and other than any
items which represent the reversal of any accrual of, or cash reserve for,
anticipated cash charges for any prior Test Period subsequent to the issue date
which was not added back to Consolidated EBITDA when accrued; minus

 

  (b)

each of the following:

 

  (i)

to the extent included in calculating such Consolidated Net Income, non-cash
items increasing such Consolidated Net Income for such Test Period, other than
the accrual of revenue in the ordinary course of business, and other than any
items which represent the reversal of any accrual of, or cash reserve for,
anticipated cash charges for any prior Test Period subsequent to the issue date
which was not added back to Consolidated EBITDA when accrued;

 

  (ii)

to the extent included in calculating such Consolidated Net Income, the amount
of any gains resulting from mark to market accounting of Swap Contracts or other
derivative instruments; and

 

  (iii)

to the extent included in calculating such Consolidated Net Income, any unusual
or non-recurring items of income or gain to the extent increasing Consolidated
Net Income for such Test Period; plus

(c) the amount of cost savings, operating expense reductions, other operating
improvements and synergies projected by Borrower in good faith to be realized as
a result of specified actions taken or with respect to which steps have been
initiated (in the good faith determination of Borrower) during such Test Period
(or with respect to (x) the Transactions, are reasonably expected to be
initiated within eighteen (18) months of the Closing Date, or (y) Specified
Transactions, are reasonably expected to be initiated within eighteen
(18) months of the closing date of the Specified Transaction), including in
connection with the Transactions or any Specified Transaction (calculated on a
Pro Forma Basis as though such cost savings, operating expense reductions, other
operating improvements and synergies had been realized during the entirety of
such Test Period), net of the amount of actual benefits realized during such
Test Period from such actions; provided that (i) a duly completed Officer’s
Certificate of Borrower shall be delivered to Administrative Agent together with
the applicable Section 9.04 Financials, providing reasonable detail with respect
to such cost savings, operating expense reductions, other operating improvements
and synergies and certifying that such savings, operating expense reductions,
other operating improvements and synergies are reasonably expected to be
realized within eighteen (18) months of the taking of such specified actions and
are reasonably identifiable and factually supportable in the good faith judgment
of Borrower, (ii) such actions are to be taken within (A) in the case of any
such cost savings, operating expense reductions, other operating improvements
and synergies in connection with the Transactions, eighteen (18) months after
the Closing Date and (B) in all other cases, within eighteen (18) months after
the consummation of such Specified Transaction, restructuring or implementation
of an initiative that is expected to result in such cost savings, expense
reductions, other operating improvements or synergies, (iii) no cost savings,
operating expense reductions, other operating improvements and synergies shall
be added pursuant to this clause (c) to the extent duplicative of any expenses
or charges otherwise added to Consolidated EBITDA, whether through a pro forma
adjustment or

 

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otherwise, for such Test Period, and (iv) projected amounts (and not yet
realized) may no longer be added in calculating Consolidated EBITDA pursuant to
this clause (c) to the extent more than eighteen (18) months have elapsed after
the specified action taken in order to realize such projected cost savings,
operating expense reductions, other operating improvements and synergies;
provided, that the aggregate amount of additions made to Consolidated EBITDA for
any Test Period pursuant to this clause (c) and Section 1.05(c) shall not
(i) exceed 20.0% of Consolidated EBITDA for such Test Period (after giving
effect to this clause (c) and Section 1.05(c)) or (ii) be duplicative of one
another; plus

(d) to the extent not included in Consolidated Net Income or, if otherwise
excluded from Consolidated EBITDA due to the operation of clause (b)(iii) above,
the amount of insurance proceeds received during such Test Period or after such
Test Period and on or prior to the date the calculation is made with respect to
such Test Period, attributable to any property which has been closed or had
operations curtailed for such Test Period; provided that such amount of
insurance proceeds shall only be included pursuant to this clause (d) to the
extent the amount of insurance proceeds plus Consolidated EBITDA attributable to
such property for such Test Period (without giving effect to this clause (d))
does not exceed Consolidated EBITDA attributable to such property during the
most recently completed four fiscal quarters for which financial results are
available that such property was fully operational (or if such property has not
been fully operational for four consecutive fiscal quarters for which financial
results are available prior to such closure or curtailment, the Consolidated
EBITDA attributable to such property during the Test Period prior to such
closure or curtailment (for which financial results are available) annualized
over four fiscal quarters); plus

(e) cash receipts (or any netting arrangements resulting in reduced cash
expenditures) not representing Consolidated EBITDA or Consolidated Net Income in
any Test Period to the extent non-cash gains relating to such income were
deducted in the calculation of Consolidated EBITDA pursuant to paragraph
(b) above for any previous Test Period and not added back.

Consolidated EBITDA shall be further adjusted (without duplication):

(A) to include the Consolidated EBITDA of (i) any Person, property, business or
asset (including a management agreement or similar agreement) (other than an
Unrestricted Subsidiary) acquired by Borrower or any Restricted Subsidiary
during such Test Period and (ii) any Unrestricted Subsidiary that is revoked and
converted into a Restricted Subsidiary during such Test Period, in each case,
based on the Consolidated EBITDA of such Person (or attributable to such
property, business or asset) for such period (including the portion thereof
occurring prior to such acquisition or Revocation), determined as if references
to Borrower and its Restricted Subsidiaries in Consolidated Net Income and other
defined terms therein were to such Person and its Subsidiaries;

(B) to exclude the Consolidated EBITDA of (i) any Person, property, business or
asset (other than an Unrestricted Subsidiary) sold, transferred or otherwise
disposed of, closed or classified as discontinued operations by Borrower or any
Restricted Subsidiary during such Test Period and (ii) any Restricted Subsidiary
that is designated as an Unrestricted Subsidiary during such Test Period, in
each case based on the actual Consolidated EBITDA of such Person for such period
(including the portion thereof occurring prior to such sale, transfer,
disposition, closing, classification or conversion), determined as if references
to Borrower and its Restricted Subsidiaries in Consolidated Net Income and other
defined terms therein were to such Person and its Subsidiaries;

(C) in the event of any Expansion Capital Expenditures that were opened for
business during such Test Period, by multiplying the Consolidated EBITDA
attributable to such Expansion Capital

 

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Expenditures (as determined by Borrower in good faith) in respect of the first
three (3) complete fiscal quarters following opening of the business
representing such Expansion Capital Expenditures by: (x) 4 (with respect to the
first such quarter), (y) 2 (with respect to the first two such quarters), and
(z) 4/3 (with respect to the first three such quarters) and, for the avoidance
of doubt, excluding Consolidated EBITDA attributable to such Expansion Capital
Expenditures during the quarter in which the business representing such
Expansion Capital Expenditure opened (unless such business opened on the first
day of a fiscal quarter);

(D) in the event of any Development Project that was opened for business during
such Test Period, by multiplying the Consolidated EBITDA attributable to such
Development Project (as determined by Borrower in good faith) in respect of the
first three (3) complete fiscal quarters following opening of the business
representing such Development Project by: (x) 4 (with respect to the first such
quarter), (y) 2 (with respect to the first two such quarters), and (z) 4/3 (with
respect to the first three such quarters) and, for the avoidance of doubt,
excluding Consolidated EBITDA attributable to such Development Project during
the quarter in which such Development Project opened (unless such business
opened on the first day of a fiscal quarter); and

(E) in the event of any new operations of Borrower or any Subsidiary that have
been organically developed by Borrower or any Subsidiary (e.g., not a Permitted
Acquisition, but self-developed or self-constructed) that were opened during
such Test Period, by multiplying the Consolidated EBITDA attributable to such
new organically developed operations (as determined by Borrower in good faith)
in respect of the first three (3) complete fiscal quarters following opening of
the business representing such organically developed operations by: (x) 4 (with
respect to the first such quarter), (y) 2 (with respect to the first two such
quarters), and (z) 4/3 (with respect to the first three such quarters) and, for
the avoidance of doubt, excluding Consolidated EBITDA attributable to such new
organically developed operations during the quarter in which such new
organically developed operations opened (unless such business opened on the
first day of a fiscal quarter); and

(F) in any fiscal quarter during which a purchase of property that prior to such
purchase was subject to any operating lease that will be terminated in
connection with such purchase shall occur and during the three (3) following
fiscal quarters, by increasing Consolidated EBITDA by an amount equal to the
quarterly payment in respect of such lease (as if such purchase did not occur)
times (a) four (4) (in the case of the quarter in which such purchase occurs),
(b) three (3) (in the case of the quarter following such purchase), (c) two (2)
(in the case of the second quarter following such purchase) and (d) one (1) (in
the case of the third quarter following such purchase), all as determined on a
consolidated basis for Borrower and its Restricted Subsidiaries.

Notwithstanding anything to the contrary contained herein, Consolidated EBITDA
shall be deemed to be $38,400,000 for the fiscal quarter ended on December 31,
2016; $47,300,000 for the fiscal quarter ended on March 31, 2017; and
$46,200,000 for the fiscal quarter ended on June 30, 2017.

“Consolidated First Lien Net Leverage Ratio” shall mean, as of any date of
determination, the ratio of (a) Consolidated Net Indebtedness of Borrower and
its Restricted Subsidiaries that is secured by Liens on property or assets of
Borrower or its Restricted Subsidiaries as of such date that ranks pari passu or
senior to the Liens securing the Obligations to (b) Consolidated EBITDA for the
Test Period most recently ended prior to such date.

“Consolidated Interest Expense” shall mean, for any Test Period, the sum of
interest expense of Borrower and its Restricted Subsidiaries for such Test
Period as determined on a consolidated basis in accordance with GAAP, plus, to
the extent deducted in arriving at Consolidated Net Income and without

 

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duplication, (a) the interest portion of payments on Capital Leases,
(b) amortization of financing fees, debt issuance costs and interest or deferred
financing or debt issuance costs, (c) arrangement, commitment or upfront fees,
original issue discount, redemption or prepayment premiums, (d) commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing, (e) interest with respect to Indebtedness that
has been Discharged and any Escrowed Indebtedness, (f) the accretion or accrual
of discounted liabilities during such period, (g) interest expense attributable
to the movement of the mark-to-market valuation of obligations under Swap
Contracts or other derivative instruments, (h) net payments made under Swap
Contracts relating to interest rates with respect to such Test Period and any
costs associated with breakage in respect of hedging agreements for interest
rates, (i) all interest expense consisting of liquidated damages for failure to
timely comply with registration rights obligations and financing fees, all as
calculated on a consolidated basis in accordance with GAAP, (j) fees and
expenses associated with the consummation of the Transactions, (k) annual or
quarterly agency fees paid to Administrative Agent and (l) costs and fees
associated with obtaining Swap Contracts and fees payable thereunder.

“Consolidated Net Income” shall mean, for any Test Period, the aggregate of the
net income of Borrower and its Restricted Subsidiaries for such Test Period, on
a consolidated basis, determined in accordance with GAAP; provided that, without
duplication:

(a) any gain or loss (together with any related provision for taxes thereon)
realized in connection with (i) any asset sale or (ii) any disposition of any
securities by such Person or any of its Restricted Subsidiaries shall be
excluded;

(b) any extraordinary gain or loss (together with any related provision for
taxes thereon) shall be excluded;

(c) the net income of any Person that (i) is not a Restricted Subsidiary,
(ii) is accounted for by the equity method of accounting, (iii) is an
Unrestricted Subsidiary or (iv) is a Restricted Subsidiary (or former Restricted
Subsidiary) with respect to which a Trigger Event has occurred following the
occurrence and during the continuance of such Trigger Event shall be excluded;
provided that Consolidated Net Income of Borrower and its Restricted
Subsidiaries shall be increased by the amount of dividends or distributions or
other payments (including management fees) that are actually paid or are payable
in cash to Borrower or a Restricted Subsidiary thereof in respect of such period
by such Persons (or to the extent converted into cash);

(d) the undistributed earnings of any Restricted Subsidiary of Borrower that is
not a Guarantor to the extent that, on the date of determination the payment of
cash dividends or similar cash distributions by such Restricted Subsidiary (or
loans or advances by such subsidiary to any parent company) are not permitted by
the terms of any Contractual Obligation (other than under any Credit Document)
or Requirement of Law applicable to such Restricted Subsidiary shall be
excluded, unless such restrictions with respect to the payment of cash dividends
and other similar cash distributions have been waived; provided that
Consolidated Net Income of Borrower and its Restricted Subsidiaries shall be
increased by the amount of dividends or distributions or other payments
(including management fees) that are actually paid or are payable in cash to
Borrower or a Restricted Subsidiary (not subject to such restriction) thereof in
respect of such period by such Restricted Subsidiaries (or to the extent
converted into cash);any goodwill or other asset impairment charges or other
asset write-offs or write downs, including any resulting from the application of
Accounting Standards Codification Nos. 350 and No. 360, and any expenses or
charges relating to the amortization of intangibles as a result of the
application of Accounting Standards Codification No. 805, shall be excluded;

 

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(e) any non-cash charges or expenses related to the repurchase of stock options
to the extent not prohibited by this Agreement, and any non-cash charges or
expenses related to the grant, issuance or repricing of, or any amendment or
substitution with respect to, or otherwise in respect of, stock appreciation or
similar rights, stock options, restricted stock, or other Equity Interests or
other equity based awards or rights or equivalent instruments, shall be
excluded;

(f) the cumulative effect of a change in accounting principles shall be
excluded;

(g) any expenses or reserves for liabilities shall be excluded to the extent
that Borrower or any of its Restricted Subsidiaries is entitled to
indemnification therefor under binding agreements; provided that any such
liabilities for which Borrower or any of its Restricted Subsidiaries is not
actually indemnified shall reduce Consolidated Net Income for the period in
which it is determined that Borrower or such Restricted Subsidiary will not be
indemnified (to the extent such liabilities would otherwise reduce Consolidated
Net Income without giving effect to this clause (h));

(h) losses, to the extent covered by insurance and actually reimbursed, or, so
long as Borrower has made a determination that there exists reasonable evidence
that such amount will in fact be reimbursed by the insurer and only to the
extent that such amount is (i) not denied by the applicable carrier in writing
within 180 days and (ii) in fact reimbursed within 365 days of the date of such
evidence (with a deduction for any amount so added back to the extent not so
reimbursed within 365 days), expenses with respect to liability or casualty
events or business interruption shall be excluded;

(i) gains and losses resulting solely from fluctuations in currency values and
the related tax effects shall be excluded, and charges relating to Accounting
Standards Codification Nos. 815 and 820 shall be excluded; and

(j) the net income (or loss) of a Restricted Subsidiary that is not a Wholly
Owned Subsidiary shall be included in an amount proportional to Borrower’s
economic ownership interest therein.

“Consolidated Net Indebtedness” shall mean, as at any date of determination,
(a) the aggregate amount of all Indebtedness of Borrower and its Restricted
Subsidiaries (other than any such Indebtedness that has been Discharged and any
Escrowed Indebtedness) on such date, in an amount that would be reflected on a
balance sheet on such date prepared on a consolidated basis in accordance with
GAAP, consisting of Indebtedness for borrowed money, obligations in respect of
Capital Leases, purchase money Indebtedness, Indebtedness evidenced by
promissory notes and similar instruments and Contingent Obligations in respect
of any of the foregoing (to be included only to the extent set forth in clause
(iii) below), minus (b) Unrestricted Cash, minus (c) Development Expenses (x) of
the type in clause (a) of the definition thereof and (y) to the extent paid
using Unrestricted Cash, of the type in clause (b) in such definition thereof
(excluding Development Expenses that consist of Unrestricted Cash that was
deducted from Consolidated Net Indebtedness pursuant to clause (b) above, if
any); provided that (i) Consolidated Net Indebtedness shall not include
(A) Indebtedness in respect of letters of credit, except to the extent of
unreimbursed amounts thereunder or (B) Indebtedness of the type described in
clause (i) of the definition thereof, (ii) the amount of Consolidated Net
Indebtedness, in the case of Indebtedness of a Restricted Subsidiary that is not
a Wholly Owned Subsidiary, shall be reduced by an amount directly proportional
to the amount (if any) by which Consolidated EBITDA was reduced (including
through the calculation of Consolidated Net Income) in respect of such
non-controlling interest in such Restricted Subsidiary owned by a Person other
than Borrower or any of its Restricted Subsidiaries, (iii) Consolidated Net
Indebtedness shall not include Contingent Obligations, provided, however, that
if and when any such Contingent

 

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Obligation that does not constitute Consolidated Net Indebtedness is demanded
for payment from Borrower or any of its Restricted Subsidiaries, then the
amounts of such Contingent Obligation shall be included in such calculations of
Consolidated Net Indebtedness and (iv) the amount of Consolidated Net
Indebtedness, in the case of Indebtedness of a Subsidiary of Borrower that is
not a Guarantor and which Indebtedness is not guaranteed by any Credit Party in
an amount in excess of the proportion of such Indebtedness that would not be so
excluded shall be reduced by an amount directly proportional to the amount by
which Consolidated EBITDA was reduced due to the undistributed earnings of such
Subsidiary being excluded from Consolidated Net Income pursuant to clause
(d) thereof.

“Consolidated Secured Net Indebtedness” shall mean Consolidated Net Indebtedness
minus the sum of the portion of Indebtedness of Borrower or any Restricted
Subsidiary included in Consolidated Net Indebtedness that is not secured by any
Lien on property or assets of Borrower or any Restricted Subsidiary.

“Consolidated Total Assets” shall mean, as at any date of determination with
respect to any Person, the total amount of all assets of such Person in
accordance with GAAP, as shown on the most recent Section 9.04 Financials.

“Consolidated Total Net Leverage Ratio” shall mean, as at any date of
determination, the ratio of (a) Consolidated Net Indebtedness as of such date to
(b) Consolidated EBITDA for the Test Period most recently ended prior to such
date; provided, however that for purposes of (i) Section 2.09(b)(ii) and
(ii) determining whether the maximum permitted Consolidated Total Net Leverage
Ratio is satisfied pursuant to Sections 10.06(j), 10.06(k), 10.09(a)(ii) and
10.09(a)(iii), the amount described in clause (a) above shall be calculated
without giving effect to clause (c) of the definition of Consolidated Net
Indebtedness.

“Consolidated Total Secured Net Leverage Ratio” shall mean, as at any date of
determination, the ratio of (a) Consolidated Secured Net Indebtedness as of such
date to (b) Consolidated EBITDA for the Test Period most recently ended prior to
such date.

“Contingent Obligation” shall mean, as to any Person, any obligation of such
Person guaranteeing or intended to guarantee any Indebtedness (“primary
obligations”) of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, including any obligation of such Person, whether or not
contingent, (a) to purchase any such primary obligation or any property
constituting direct or indirect security therefor; (b) to advance or supply
funds (i) for the purchase or payment of any such primary obligation or (ii) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor; (c) to purchase
property, securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation; or (d) otherwise to assure or hold harmless
the holder of such primary obligation against loss in respect thereof; provided,
however, that the term Contingent Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business and any
lease guarantees executed by any Company in the ordinary course of business. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable pursuant to the terms of the
instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated potential liability in respect
thereof (assuming such Person is required to perform thereunder) as determined
by such Person in good faith.

 

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“Contract Consideration” has the meaning set forth in the definition of “Excess
Cash Flow.”

“Contractual Obligation” shall mean as to any Person, any provision of any
security issued by such Person or of any mortgage, deed of trust, security
agreement, pledge agreement, promissory note, indenture, credit or loan
agreement, guaranty, securities purchase agreement, instrument, lease, contract,
agreement or other contractual obligation to which such Person is a party or by
which it or any of its Property is bound or subject.

“Core Property” means, collectively, (a) (i) Stratosphere Casino, Hotel & Tower,
located in Las Vegas Nevada, (ii) Arizona Charlie’s Hotel & Casino – Boulder,
located in Las Vegas, Nevada, (iii) Arizona Charlie’s Hotel & Casino – Decatur,
located in Las Vegas, Nevada, (iv) Aquarius Casino Resort, located in Laughlin,
Nevada, and (v) the Rocky Gap Property and (b) each casino or hotel property
(for purposes of clarification, excluding Route Agreements or real property
associated therewith) hereafter owned or operated by Borrower or a Restricted
Subsidiary (but not any such property that is (i) owned by an Unrestricted
Subsidiary or (ii) so long as not owned by Borrower or a Restricted Subsidiary,
operated by an Unrestricted Subsidiary) whose individual Consolidated EBITDA
(determined in a manner acceptable to the Administrative Agent) for the then
most recently ended Test Period exceeds 5.0% of the Consolidated EBITDA of
Borrower and its Restricted Subsidiaries at the time of determination, excluding
any real property or improvements that have been released from the Liens of the
Collateral Agent in accordance with the terms of the Credit Documents.

“Covered Taxes” shall mean all (a) Taxes, other than Excluded Taxes, imposed on
or with respect to any payment made by or on account of any obligation of any
Credit Party under this Agreement, any Note, any Guarantee or any other Credit
Document and (b) to the extent not otherwise described in the foregoing clause
(a), Other Taxes.

“Credit Agreement Refinancing Indebtedness” shall mean (a) Permitted Second
Priority Refinancing Debt, (b) Permitted Unsecured Refinancing Debt or (c) other
Indebtedness incurred pursuant to a Refinancing Amendment (including, without
limitation, Other Term Loans), in each case, issued, incurred or otherwise
obtained (including by means of the extension or renewal of existing
Indebtedness) in exchange for, or to extend, renew, replace or refinance, in
whole or part, then-existing Term Loans and/or Credit Agreement Refinancing
Indebtedness (“Refinanced Debt”); provided that (i) other than in the case of
customary “bridge” facilities (so long as the long term debt into which any such
customary “bridge” facility is to be automatically converted satisfies the
following requirements), such Indebtedness has the same or a later maturity
(provided that if such Indebtedness is subordinated to the Obligations or
secured by a junior lien on the Collateral or is unsecured, then its maturity
shall be no earlier than the 91st day after the Final Maturity Date) and a
Weighted Average Life to Maturity equal to or greater than, the Refinanced Debt
(determined without giving effect to the impact of prepayments on amortization
of Term Loans being refinanced), (ii) such Indebtedness shall not have a greater
principal amount than the principal amount of the Refinanced Debt, plus, accrued
interest, fees and premiums (if any) thereon, plus, other fees and expenses
associated with the refinancing (including any arrangement fees, upfront fees
and original issue discount), plus, any unutilized commitments thereunder,
(iii) such Refinanced Debt shall be repaid, defeased or satisfied and discharged
on a dollar-for-dollar basis, and all accrued interest, fees and premiums (if
any) in connection therewith shall be paid, on the date such Credit Agreement
Refinancing Indebtedness is issued, incurred or obtained, (iv) [reserved], (v)
the terms (excluding maturity, amortization, pricing, fees, rate floors,
premiums, optional prepayment or optional redemption provisions) of such
Indebtedness are (as determined by Borrower in good faith) substantially
identical to the terms of the Term B Facility Loans as existing on the date of
incurrence of such Credit Agreement Refinancing Indebtedness except, to the
extent such terms (x) at the option of Borrower (1) reflect market terms and
conditions (taken as a whole) at the time of incurrence or issuance (as
determined by Borrower in good

 

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faith); provided that, if any financial maintenance covenant is added for the
benefit of any Credit Agreement Refinancing Indebtedness constituting term
loans, such financial maintenance covenant shall also be applicable to the Term
B Facility Loans (except to the extent such financial maintenance covenant
applies only to periods after the Final Maturity Date), (2) with respect to any
Credit Agreement Refinancing Indebtedness that is unsecured, are customary for
issuances of “high yield” securities; provided that, if any financial
maintenance covenant is added for the benefit of any such Credit Agreement
Refinancing Indebtedness, such financial maintenance covenant shall also be
applicable to the Term B Facility Loans (except to the extent such financial
maintenance covenant applies only to periods after the Final Maturity Date), or
(3) are not materially more restrictive to Borrower (as reasonably determined by
Borrower in good faith), when taken as a whole, than the terms of the Term B
Facility Loans (except for covenants or other provisions applicable only to
periods after the Final Maturity Date applicable to the Term B Facility Loans)
(it being understood that any Credit Agreement Refinancing Indebtedness may
provide for the ability to participate (i) with respect to any borrowings,
voluntary prepayments or voluntary commitment reductions, on a pro rata basis,
greater than pro rata basis or less than pro rata basis with the applicable
Loans or facility and (ii) with respect to any mandatory prepayments, on a pro
rata basis (only in respect of a Credit Agreement Refinancing Indebtedness that
ranks pari passu with the Obligations) or less than pro rata basis with the
applicable Loans (and on a greater than pro rata basis with respect to
prepayments of any such Credit Agreement Refinancing Indebtedness with the
proceeds of permitted refinancing Indebtedness), or (y) are (1) added to the
Term B Facility Loans, (2) applicable only after the Final Maturity Date or
(3) otherwise reasonably satisfactory to Administrative Agent (it being
understood that to the extent any financial maintenance covenant is added for
the benefit of any such Credit Agreement Refinancing Indebtedness, no consent
shall be required from Administrative Agent or any of the Lenders to the extent
that such financial maintenance covenant (together with any related “equity
cure” provisions) is also added for the benefit of any corresponding existing
Facility), (vi) Borrower shall be the sole borrower thereunder and no Subsidiary
of Borrower shall guaranty such Indebtedness unless such Subsidiary is also a
Guarantor hereunder, and (vii) to the extent such Indebtedness is secured, such
Indebtedness shall not be secured by any Liens on any assets, except Liens on
the Collateral. For the avoidance of doubt, the usual and customary terms of
convertible or exchangeable debt instruments issued in a registered offering or
under Rule 144A of the Securities Act shall be deemed to be no more restrictive
in any material respect to Borrower and its Restricted Subsidiaries than the
terms set forth in this Agreement, so long as the terms of such instruments do
not include any financial maintenance covenant.

“Credit Documents” shall mean (a) this Agreement, (b) the Notes, (c) the
Security Documents, (d) any Pari Passu Intercreditor Agreement, (e) any First
Lien/Second Lien Intercreditor Agreement, (f) any Incremental Joinder Agreement,
(g) any Extension Amendment, (h) any Refinancing Amendment and (i) each other
agreement entered into by any Credit Party with Administrative Agent, Collateral
Agent and/or any Lender, in connection herewith or therewith evidencing or
governing the Obligations (other than the Commitment Letter), all as amended
from time to time, but shall not include a Swap Contract or Cash Management
Agreement.

“Credit Parties” shall mean Borrower and the Guarantors.

“Credit Suisse” shall mean Credit Suisse AG, Cayman Islands Branch.

“Creditor” shall mean each of (a) each Agent and (b) each Lender.

“Custodian Agreement” shall mean that certain Custodian Agreement dated as of
the Closing Date among Wilmington Trust, National Association, as custodian, the
First Lien Administrative Agent

 

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and the Credit Parties named therein, as the same may be amended in accordance
with the terms thereof and hereof.

“Debt Fund Affiliate” shall mean (i) any affiliate of Borrower that is a bona
fide debt Fund or managed account or financial institution that is engaged in
making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course of business or (ii) any
affiliate of Borrower that is primarily engaged in, or advises funds or other
investment vehicles that are engaged in, making, purchasing, holding or
otherwise investing in commercial loans, bonds and similar extensions of credit
or securities in the ordinary course and whose managers have fiduciary duties to
the investors in such fund or other investment vehicle independent of, or in
addition to, their duties to Borrower.

“Debt Issuance” shall mean the incurrence by Borrower or any Restricted
Subsidiary of any Indebtedness after the Closing Date (other than as permitted
by Section 10.01). The issuance or sale of any debt instrument convertible into
or exchangeable or exercisable for any Equity Interests shall be deemed a Debt
Issuance for purposes of Section 2.10(a).

“Debtor Relief Laws” shall mean the Bankruptcy Code, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization or similar
debtor relief Laws of the United States or other applicable jurisdiction from
time to time in effect.

“Declined Amounts” shall have the meaning provided in Section 2.10(b).

“Default” shall mean any event or condition that constitutes an Event of Default
or that would become, with notice or lapse of time or both, an Event of Default.

“Default Rate” shall mean a per annum rate equal to, (i) in the case of
principal on any Loan, the rate which is 2% in excess of the rate borne by such
Loan immediately prior to the respective payment default or other Event of
Default, and (ii) in the case of any other Obligations, the rate which is 2% in
excess of the rate otherwise applicable to ABR Loans from time to time.

“Defaulting Lender” shall mean, subject to Section 2.14(b), any Lender that
(i) has failed to fund all or any portion of its Loans within two (2) Business
Days of the date such Loans were required to be funded hereunder unless such
Lender has notified Administrative Agent and Borrower in writing that such
failure is the result of such Lender’s good faith determination that one or more
conditions precedent to funding has not been satisfied (which conditions
precedent, together with the applicable default, if any, will be specifically
identified in such writing), (ii) has notified Borrower or Administrative Agent
in writing, or has stated publicly, that it will not comply with any such
funding obligation hereunder, unless such writing or statement states that such
position is based on such Lender’s good faith determination that one or more
conditions precedent to funding cannot be satisfied (which conditions precedent,
together with the applicable default, if any, will be specifically identified in
such writing or public statement), or has defaulted generally (excluding bona
fide disputes) on its funding obligations under other loan agreements or credit
agreements or other similar agreements, (iii) a Lender Insolvency Event has
occurred and is continuing with respect to such Lender or its Parent Company,
(iv) any Lender that has, for three or more Business Days after written request
of Administrative Agent or Borrower, failed to confirm in writing to
Administrative Agent and Borrower that it will comply with its prospective
funding obligations hereunder (provided that such Lender will cease to be a
Defaulting Lender pursuant to this clause (iv) upon Administrative Agent’s and
Borrower’s receipt of such written confirmation) or (v) becomes the

 

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subject of a Bail-in Action. Any determination of a Defaulting Lender under
clauses (i) through (v) above will be conclusive and binding absent manifest
error.

“Designated Non-Cash Consideration” shall mean the fair market value of non-cash
consideration received by Borrower or any of its Restricted Subsidiaries in
connection with an Asset Sale that is so designated as Designated Non-Cash
Consideration pursuant to an Officers’ Certificate setting forth the basis of
such valuation, executed by a financial officer of Borrower, minus the amount of
cash or Cash Equivalents received in connection with a subsequent sale of or
collection on such Designated Non-Cash Consideration.

“Designation” has the meaning set forth in Section 9.12(a).

“Designation Amount” has the meaning set forth in Section 9.12(a)(ii).

“Development Expenses” shall mean, without duplication, the aggregate principal
amount, not to exceed $90.0 million at any time, of (a) outstanding Indebtedness
incurred after the Closing Date, the proceeds of which, at the time of
determination, as certified by a Responsible Officer of Borrower, are pending
application and are required or intended to be used to fund and (b) amounts
spent after the Closing Date (whether funded with the proceeds of Indebtedness,
cash flow or otherwise) to fund, in each case, (i) Expansion Capital
Expenditures of Borrower or any Restricted Subsidiary, (ii) a Development
Project or (iii) interest, fees or related charges with respect to such
Indebtedness; provided that (A) Borrower or the Restricted Subsidiary or other
Person that owns assets subject to the Expansion Capital Expenditure or
Development Project, as applicable, is diligently pursuing the completion
thereof and has not at any time ceased construction of such Expansion Capital
Expenditure or Development Project, as applicable, for a period in excess of 90
consecutive days (other than as a result of a force majeure event or inability
to obtain requisite Gaming Approvals or other governmental authorizations, so
long as, in the case of any such Gaming Approvals or other governmental
authorizations, Borrower or a Restricted Subsidiary or other applicable Person
is diligently pursuing such Gaming Approvals or governmental authorizations),
(B) no such Indebtedness or funded costs shall constitute Development Expenses
with respect to an Expansion Capital Expenditure or a Development Project from
and after the end of the first full fiscal quarter after the completion of
construction of the applicable Expansion Capital Expenditure or Development
Project or, in the case of a Development Project or Expansion Capital
Expenditure that was not open for business when construction commenced, from and
after the end of the first full fiscal quarter after the date of opening of such
Development Project or Expansion Capital Expenditure, if earlier, and (C) in
order to avoid duplication, it is acknowledged that to the extent that the
proceeds of any Indebtedness referred to in clause (a) above have been applied
(whether for the purposes described in clauses (i), (ii) or (iii) above or any
other purpose), such Indebtedness shall no longer constitute Development
Expenses under clause (a) above (it being understood, however, that any such
application in accordance with clauses (i), (ii) or (iii) above shall, subject
to the other requirements and limitations of this definition, constitute
Development Expenses under clause (b) above).

“Development Project” shall mean Investments, directly or indirectly, (a) in any
Joint Ventures or Unrestricted Subsidiaries in which Borrower or any of its
Restricted Subsidiaries, directly or indirectly, has control or with whom it has
a management, development or similar contract and, in the case of a Joint
Venture, in which Borrower or any of its Restricted Subsidiaries owns (directly
or indirectly) at least 25% of the Equity Interest of such Joint Venture, or
(b) in, or expenditures with respect to, casinos, “racinos,” full service casino
resorts, non-gaming resorts, distributed gaming applications or taverns or
Persons that own casinos, “racinos,” full-service casino resorts, non-gaming
resorts, distributed gaming applications or taverns (including casinos,
“racinos,” full-service casino resorts, non-gaming resorts, distributed gaming
applications or taverns in development or under construction that are not
presently opening or operating)

 

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with respect to which Borrower or any of its Restricted Subsidiaries will
directly manage the development thereof or (directly or indirectly through
Subsidiaries) Borrower or any of its Restricted Subsidiaries has entered into a
management, development or similar contract (or an agreement to enter into such
a management, development or similar contract) and such contract remains in full
force and effect at the time of such Investment, though it may be subject to
regulatory approvals, in each case, used to finance, or made for the purpose of
allowing such Joint Venture, Unrestricted Subsidiary, casino, “racino,”
full-service casino resort, non-gaming resort, distributed gaming application or
tavern, as the case may be, to finance the purchase or other acquisition or
construction of any fixed or capital assets or the refurbishment of existing
assets or properties that develops, adds to or significantly improves the
property of such Joint Venture, Unrestricted Subsidiary, casino, “racino,”
full-service casino resort, non-gaming resort, distributed gaming application or
tavern and assets ancillary or related thereto, or the construction and
development of a casino, “racino,” full-service casino resort, non-gaming
resort, distributed gaming application, tavern or assets ancillary or related
thereto and including Pre-Opening Expenses with respect to such Joint Venture,
Unrestricted Subsidiary, casino, “racino,” full-service casino resort,
non-gaming resort, distributed gaming application or tavern and other fees and
payments to be made to such Joint Venture, Unrestricted Subsidiary or the owners
of such casino, “racino,” full-service casino resort, non-gaming resort,
distributed gaming application or tavern.

“Discharged” shall mean Indebtedness that has been defeased (pursuant to a
contractual or legal defeasance) or discharged pursuant to the prepayment or
deposit of amounts sufficient to satisfy such Indebtedness as it becomes due or
irrevocably called for redemption (and regardless of whether such Indebtedness
constitutes a liability on the balance sheet of the obligors thereof); provided,
however, that the Indebtedness shall be deemed Discharged if the payment or
deposit of all amounts required for defeasance or discharge or redemption
thereof have been made even if certain conditions thereto have not been
satisfied, so long as such conditions are reasonably expected to be satisfied
within 95 days after such prepayment or deposit.

“Discount Range” shall have the meaning provided in Exhibit O hereto.

“Disqualification” shall mean, with respect to any Person:

(a) the failure of such Person to timely file pursuant to applicable Gaming Laws
(i) any application required of such Person by any Gaming Authorities in
connection with any licensing required of such Person as a lender to Borrower
pursuant to applicable Gaming Laws or (ii) any application or other papers, in
each case, required by any Gaming Authority in connection with a determination
by such Gaming Authority of the suitability of such Person as a lender to
Borrower;

(b) the withdrawal by such Person (except where requested or permitted by any
Gaming Authority) of any such application or other required papers; or

(c) any final determination by a Gaming Authority pursuant to applicable Gaming
Laws (i) that such Person is “unsuitable” as a lender to Borrower, (ii) that
such Person shall be “disqualified” as a lender to Borrower or (iii) denying the
issuance to such Person of a license or finding of suitability or other
approval.

“Disqualified Capital Stock” shall mean, with respect to any Person, any Equity
Interest of such Person that, by its terms (or by the terms of any security into
which it is convertible or for which it is exchangeable), or upon the happening
of any event, matures (excluding any maturity as the result of an optional
redemption by the issuer thereof) or is mandatorily redeemable or redeemable at
the sole option of the holder thereof, pursuant to a sinking fund or otherwise
(other than solely (w) for Qualified Capital

 

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Stock or upon a sale of assets, casualty event or a change of control, in each
case, subject to the prior payment in full of the Obligations, (x) as a result
of a redemption required by Gaming Law, (y) as a result of a redemption that by
the terms of such Equity Interest is contingent upon such redemption not being
prohibited by this Agreement or (z) with respect to Equity Interests issued to
any plan for the benefit of, or to, present or former directors, officers,
consultants or employees that is required to be repurchased by the issuer
thereof in order to satisfy applicable statutory or regulatory obligations as a
result of such director’s, officer’s, consultant’s, or employee’s termination,
resignation, retirement, death or disability), or exchangeable or convertible
into debt securities of the issuer thereof at the sole option of the holder
thereof, in whole or in part, on or prior to the date that is 181 days after the
Final Maturity Date then in effect at the time of issuance thereof.

“Disqualified Lenders” shall mean (a) banks, financial institutions, other
institutions or persons identified in writing to the Lead Arrangers by Borrower
on or prior to June 10, 2017 as a disqualified lender, (b) competitors or
suppliers of Borrower or its Subsidiaries identified in writing to the Lead
Arrangers (or after the Closing Date, Administrative Agent) by Borrower from
time to time (a “Competitor”), or (c) any Affiliate of such person identified
pursuant to clauses (a) or (b) that is clearly identifiable solely on the basis
of the similarity of its name or identified in writing to the Lead Arrangers (or
after the Closing Date, Administrative Agent) by Borrower from time to time
(other than any bona fide debt fund, investment vehicle, regulated bank entity
or unregulated lending entity that is (x) engaged in making, purchasing, holding
or otherwise investing in commercial loans or similar extensions of credit in
the ordinary course of business and (y) managed, sponsored or advised by any
person controlling, controlled by or under common control with a Competitor or
Affiliate thereof, as applicable, but only to the extent that no personnel
involved with the investment in such Competitor or Affiliate thereof, as
applicable makes (or has the right to make or participate with others in making)
investment decisions on behalf of such debt fund, investment vehicle, regulated
bank entity or unregulated lending entity); provided, that (i) any subsequent
designation of a Disqualified Lender will not become effective until three
(3) Business Days after such designation is delivered pursuant to the terms of
this definition, it being understood that no such subsequent designation shall
apply to any entity that is currently a Lender or party to a pending trade and
(ii) the foregoing shall not apply retroactively to disqualify any parties that
have previously been allocated a portion of the facilities hereunder or acquired
an assignment or participation interest in the facilities hereunder to the
extent such party was not a Disqualified Lender at the time of the applicable
allocation, assignment or participation, as the case may be)). All
identification by Borrower to Administrative Agent of Disqualified Lenders
pursuant to clauses (b), or (c) of this definition, including any supplements,
modifications, and deletions thereto, must be in an email sent to the attention
of Sean Portrait (email: sean.portrait@credit-suisse.com) and any failure by
Borrower to deliver the list of Disqualified Lenders to this email address will
render any such list not so delivered, including any supplements, modifications,
or deletions thereto, not delivered and ineffective.

“Dollars” and “$” shall mean the lawful money of the United States.

“Domestic Subsidiary” of any Person shall mean any Subsidiary of such Person
incorporated, organized or formed in the United States, any state thereof or the
District of Columbia.

“EEA Financial Institution” shall mean (a) any credit institution or investment
firm established in any EEA Member Country which is subject to the supervision
of an EEA Resolution Authority, (b) any entity established in an EEA Member
Country which is a parent of an institution described in clause (a) of this
definition, or (c) any financial institution established in an EEA Member
Country which is a subsidiary of an institution described in clauses (a) or (b)
of this definition and is subject to consolidated supervision with its parent.

 

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“EEA Member Country” shall mean any of the member states of the European Union,
Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” shall mean any public administrative authority or any
Person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

“Eligible Assignee” shall mean and include (i) a commercial bank, an insurance
company, a finance company, a financial institution, any fund that invests in
loans or any other “accredited investor” (as defined in Regulation D),
(ii) solely for purposes of Borrower Loan Purchases, Borrower and its Restricted
Subsidiaries, (iii) so long as in compliance with Section 13.05(e), Affiliated
Lenders and (iv) so long as in compliance with Section 13.5(h), Debt Fund
Affiliates; provided, however, that (x) other than as set forth in clauses
(ii) and (iii) of this definition, neither Borrower nor any of Borrower’s
Affiliates or Subsidiaries shall be an Eligible Assignee, (y) Eligible Assignee
shall not include any Person that is a Disqualified Lender as of the applicable
Trade Date unless consented to in writing by Borrower and (z) Eligible Assignee
shall not include any Person who is a Defaulting Lender or subject to a
Disqualification.

“Employee Benefit Plan” shall mean an employee benefit plan (as defined in
Section 3(3) of ERISA) that is maintained or contributed to by any ERISA Entity.

“Environment” shall mean ambient air, surface water and groundwater (including
potable water, navigable water and wetlands), the land surface or subsurface
strata, natural resources, the workplace or as otherwise defined in any
Environmental Law.

“Environmental Action” shall mean (a) any notice, claim, demand or other written
or, to the knowledge of any Responsible Officer of Borrower, oral communication
alleging liability of Borrower or any of its Restricted Subsidiaries for
investigation, remediation, removal, cleanup, response, corrective action or
other costs, damages to natural resources, personal injury, property damage,
fines or penalties resulting from, related to or arising out of (i) the
presence, Release or threatened Release in or into the Environment of Hazardous
Material at any location or (ii) any violation of Environmental Law, and shall
include, without limitation, any claim seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting
from, related to or arising out of the presence, Release or threatened Release
of Hazardous Material or alleged injury or threat of injury to human health,
safety or the Environment arising under Environmental Law and (b) any
investigation, monitoring, removal or remedial activities undertaken by or on
behalf of Borrower or any of its Restricted Subsidiaries, arising under
Environmental Law whether or not such activities are carried out voluntarily.

“Environmental Law” shall mean any and all applicable treaties, laws, statutes,
ordinances, regulations, rules, decrees, judgments, orders, consent orders,
consent decrees and other binding legal requirements, and the common law,
relating to protection of public health or the Environment, the Release or
threatened Release of Hazardous Material, natural resources or natural resource
damages, or occupational safety or health.

“Equity Interests” shall mean, with respect to any Person, any and all shares,
interests, participations or other equivalents, including membership interests
(however designated, whether voting or non-voting), of equity of such Person,
including, if such Person is a partnership, partnership interests (whether
general or limited) and 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, such partnership, whether outstanding on the Closing
Date or issued after the Closing Date; provided, however, that a debt

 

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instrument convertible into or exchangeable or exercisable for any Equity
Interests or Swap Contracts entered into as a part of, or in connection with, an
issuance of such debt instrument shall not be deemed an Equity Interest.

“Equity Issuance” shall mean (a) any issuance or sale after the Closing Date by
Borrower of any Equity Interests (including any Equity Interests issued upon
exercise of any Equity Rights) or any Equity Rights, or (b) the receipt by
Borrower after the Closing Date of any capital contribution (whether or not
evidenced by any Equity Interest issued by the recipient of such contribution).
The issuance or sale of any debt instrument convertible into or exchangeable or
exercisable for any Equity Interests shall be deemed a Debt Issuance and not an
Equity Issuance for purposes of the definition of Equity Issuance Proceeds;
provided, however, that such issuance or sale shall be deemed an Equity Issuance
upon the conversion or exchange of such debt instrument into Equity Interests.

“Equity Issuance Proceeds” shall mean, with respect to any Equity Issuance, the
aggregate amount of all cash received in respect thereof by the Person
consummating such Equity Issuance net of all investment banking fees, discounts
and commissions, legal fees, consulting fees, accountants’ fees, underwriting
discounts and commissions and other fees and expenses actually incurred in
connection therewith; provided that, with respect to any Equity Interests issued
upon exercise of any Equity Rights, the Equity Issuance Proceeds with respect
thereto shall be determined without duplication of any Equity Issuance Proceeds
received in respect of such Equity Rights.

“Equity Rights” shall mean, with respect to any Person, any then-outstanding
subscriptions, options, warrants, commitments, preemptive rights or agreements
of any kind (including any stockholders’ or voting trust agreements) for the
issuance, sale, registration or voting of any additional Equity Interests of any
class, or partnership or other ownership interests of any type in, such Person;
provided, however, that a debt instrument convertible into or exchangeable or
exercisable for any Equity Interests shall not be deemed an Equity Right.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.

“ERISA Entity” shall mean any member of the ERISA Group.

“ERISA Event” shall mean (a) any “reportable event,” as defined in Section 4043
of ERISA or the regulations issued thereunder, with respect to a Pension Plan
(other than an event for which the 30-day notice requirement is waived); (b)
with respect to any Pension Plan, the failure to satisfy the minimum funding
standard under Section 412 of the Code or Section 302 of ERISA, whether or not
waived, the failure by any ERISA Entity to make by its due date a required
installment under Section 430(j) of the Code with respect to any Pension Plan or
the failure to make any required contribution to a Multiemployer Plan; (c) the
filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Pension Plan; (d) the incurrence by any ERISA Entity of any liability under
Title IV of ERISA with respect to the termination of any Pension Plan; (e) the
receipt by any ERISA Entity from the PBGC or a plan administrator of any notice
indicating an intent to terminate any Pension Plan or to appoint a trustee to
administer any Pension Plan; (f) the occurrence of any event or condition which
would reasonably constitute grounds under ERISA for the termination of or the
appointment of a trustee to administer, any Pension Plan; (g) the incurrence by
any ERISA Entity of any liability with respect to the withdrawal or partial
withdrawal from any Pension Plan or Multiemployer Plan; (h) the receipt by an
ERISA Entity of any notice, or the receipt by any Multiemployer Plan from any
ERISA Entity of any notice, concerning the imposition of Withdrawal Liability on
any ERISA Entity or a determination that a Multiemployer Plan is, or is expected

 

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to be, insolvent, within the meaning of Title IV of ERISA or is in “endangered”
or “critical” status, within the meaning of Section 432 of the Code or
Section 305 of ERISA; (i) the making of any amendment to any Pension Plan which
would be reasonably likely to result in the imposition of a lien or the posting
of a bond or other security; (j) the withdrawal of any ERISA Entity from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which such
ERISA Entity was a “substantial employer” as defined in Section 4001(a)(2) of
ERISA or a cessation of operations that is treated as such a withdrawal under
Section 4062(e) of ERISA; or (k) the occurrence of a nonexempt prohibited
transaction (within the meaning of Section 4975 of the Code or Section 406 of
ERISA) which would reasonably be expected to result in liability to Borrower or
any of its Restricted Subsidiaries.

“ERISA Group” shall mean Borrower and its Restricted Subsidiaries and all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with Borrower
or any of its Restricted Subsidiaries, are treated as a single employer under
Section 414(b) or (c) of the Code.

“Escrowed Indebtedness” shall mean Indebtedness issued in escrow pursuant to
customary escrow arrangements pending the release thereof.

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor Person), as in effect
from time to time.

“Events of Default” has the meaning set forth in Section 11.01.

“Excess Cash Flow” shall mean, for any fiscal year of Borrower, an amount, if
positive, equal to (without duplication):

(a) Consolidated Net Income; plus

(b) an amount equal to the amount of all non-cash charges or losses (including
write-offs or write-downs, depreciation expense and amortization expense
including amortization of goodwill and other intangibles) to the extent deducted
in arriving at such Consolidated Net Income (excluding any such non-cash expense
to the extent that it represents an accrual or reserve for potential cash charge
in any future period or amortization of a prepaid cash charge that was paid in a
prior period and that did not reduce Excess Cash Flow at the time paid); plus

(c) the decrease, if any, in Working Capital from the beginning of such period
to the end of such period (for the avoidance of doubt, an increase in negative
Working Capital is a decrease in Working Capital); minus

(d) all payments with respect to restricted stock units upon the Person to whom
such restricted stock units were originally issued ceasing to be a director,
officer, employee, consultant or advisor and net income or loss allocated to
unvested participating restricted stock of Borrower; plus

(e) any amounts received from the early extinguishment of Swap Contracts that
are not included in Consolidated Net Income; minus

(f) the increase, if any, of Working Capital from the beginning of such period
to the end of such period; minus

 

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(g) any amounts paid in connection with the early extinguishment of Swap
Contracts that are not included in Consolidated Net Income; minus

(h) the amount of Capital Expenditures made in cash during such period (or, at
Borrower’s election, after such period and prior to the date the applicable
Excess Cash Flow prepayment is due (without duplication of amounts deducted from
Excess Cash Flow in any other period)), except to the extent financed with the
proceeds of an Equity Issuance, Indebtedness (other than revolving
Indebtedness), Asset Sales or Casualty Events (to the extent such proceeds did
not increase Consolidated Net Income) of Borrower or its Restricted
Subsidiaries; minus

(i) the amount of principal payments made in cash during such period (or, at
Borrower’s election, after such period and prior to the date the applicable
Excess Cash Flow prepayment is due (without duplication of amounts deducted from
Excess Cash Flow in any other period)) of the Loans, Other Applicable
Indebtedness. First Lien Term Loans, First Lien Revolving Loans, Other First
Lien Indebtedness and Other Second Lien Indebtedness of Borrower and its
Restricted Subsidiaries (excluding (i) repayments of revolving indebtedness,
except to the extent the commitments in respect of such revolving debt are
permanently reduced in connection with such repayments, (ii) prepayments of
Loans, First Lien Term Loans, First Lien Revolving Loans or other Indebtedness,
in each case, that reduce the amount of Excess Cash Flow prepayment required to
be made with respect to such fiscal year under Section 2.10(a)(iv)(y) (including
as a result of Section 2.10(a)(vii)) and (iii) mandatory prepayments of
(A) Loans pursuant to Section 2.10(a)(i), 2.10(a)(ii) or 2.10(a)(iii) and
(B) First Lien Term Loans and First Lien Revolving Loans pursuant to
Section 2.10(a)(i), 2.10(a)(ii) or 2.10(a)(iii) of the First Lien Credit
Agreement, in each case in this clause (iii), except to the extent the Net
Available Proceeds from such Casualty Event or Asset Sale, as applicable, used
to make such mandatory prepayments were included in the calculation of
Consolidated Net Income), in each case, except to the extent financed with the
proceeds of an Equity Issuance, Indebtedness (other than revolving
Indebtedness), Asset Sales or Casualty Events (to the extent such proceeds did
not increase Consolidated Net Income) of Borrower or its Restricted
Subsidiaries; minus

(j) the amount of Investments made during such period (or, at Borrower’s
election, after such period and prior to the date the applicable Excess Cash
Flow prepayment is due (without duplication of amounts deducted from Excess Cash
Flow in any other period)) pursuant to Section 10.04 (other than Sections
10.04(a) (to the extent outstanding on the Closing Date), (b), (c), (d), (e),
(f) (except to the extent such amount increased Consolidated Net Income), (g)
(except to the extent that the receipt of consideration described therein
increased Consolidated Net Income), (h) (to the extent taken into account in
arriving at Consolidated Net Income), (j), (l) (except to the extent made in
reliance on clause (a) of the Available Amount), (o) (to the extent outstanding
on the date of the applicable acquisition, merger or consolidation), (q), (r),
(u), (v) and (w)), except to the extent financed with the proceeds of an Equity
Issuance, Indebtedness (other than revolving Indebtedness), Asset Sales or
Casualty Events (to the extent such proceeds did not increase Consolidated Net
Income) of Borrower or its Restricted Subsidiaries; minus

(k) the amount of all non-cash gains to the extent included in arriving at such
Consolidated Net Income (excluding any such non-cash gain to the extent it
represents the reversal of an accrual or reserve for a potential cash loss in
any prior period); minus

(l) the amount of all Restricted Payments made during such period (or, at
Borrower’s election, after such period and prior to the date the applicable
Excess Cash Flow prepayment is due (without duplication of amounts deducted from
Excess Cash Flow in any other period)) pursuant to Section 10.06(f), 10.06(g),
10.06(h) and 10.06(i); minus

 

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(m) the amount of all Junior Prepayments made during such period (or, at
Borrower’s election, after such period and prior to the date the applicable
Excess Cash Flow prepayment is due (without duplication of amounts deducted from
Excess Cash Flow in any other period)) pursuant to Section 10.09(a)(i),
10.09(a)(ii), 10.09(a)(iii) or 10.09(a)(viii); minus

(n) any expenses or reserves for liabilities to the extent that Borrower or any
Restricted Subsidiary is entitled to indemnification or reimbursement therefor
under binding agreements or insurance claims therefor to the extent Borrower has
not received such indemnity or reimbursement payment, in each case, to the
extent not taken into account in arriving at Consolidated Net Income; minus

(o) the amount of cash Taxes actually paid by Borrower and its Restricted
Subsidiaries to Governmental Authorities during such period; minus

(p) the amount of income tax benefit included in determining Consolidated Net
Income for such fiscal year (if any); minus

(q) to the extent included in Consolidated Net Income, Specified 10.04(k)
Investment Returns received during such fiscal year; minus

(r) without duplication of amounts deducted from Excess Cash Flow in prior
periods, the aggregate consideration required to be paid in cash by Borrower and
its Restricted Subsidiaries pursuant to binding contracts (the “Contract
Consideration”) entered into prior to or during such period relating to
Investments permitted under this Agreement or Capital Expenditures in each case
to the extent expected to be consummated or made during the period of four
consecutive fiscal quarters of Borrower following the end of such period
(except, in each case, to the extent financed (or anticipated to be financed)
with proceeds of an Equity Issuance, Indebtedness (other than revolving
Indebtedness), Asset Sales or Casualty Events (to the extent such proceeds do
not (or are not anticipated to) increase Consolidated Net Income)); provided
that to the extent the aggregate amount actually utilized in cash to finance
such Investments or Capital Expenditures during such period of four consecutive
fiscal quarters is less than the Contract Consideration, the amount of such
shortfall shall be added to the calculation of Excess Cash Flow at the end of
such period of four consecutive fiscal quarters; minus

(s) any other cash expenditure made during such period that does not reduce
Consolidated Net Income.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.

“Excluded Contribution” shall mean net cash proceeds received by Borrower from
the sale (other than (i) to a Subsidiary of Borrower or (ii) to any management
equity plan or stock option plan or any other management or employee benefit
plan or agreement of Borrower) of Equity Interests of Borrower in each case
(x) not including any amounts included in the Available Amount and (y) to the
extent designated as Excluded Contributions by Borrower, pursuant to an
officer’s certificate delivered to Administrative Agent, within one hundred and
eighty (180) days of the date such capital contributions are made, such
dividends, distributions, fees or other payments are paid, or the date such
Equity Interests are sold, as the case may be.

“Excluded Information” shall have the meaning provided in Section 12.07(b).

 

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“Excluded Subsidiary” shall mean (a) any Unrestricted Subsidiary, (b) any
Immaterial Subsidiary, (c) any Subsidiary that is a (i) Foreign Subsidiary,
(ii) CFC Holdco or (iii) Subsidiary of a Foreign Subsidiary of the Borrower if
such Foreign Subsidiary is a CFC, (d) any Subsidiary that is prohibited by
applicable law, rule or regulation (including, without limitation, any Gaming
Laws) or by any agreement, instrument or other undertaking to which such
Subsidiary is a party or by which it or any of its property or assets is bound
from guaranteeing the Obligations, and in each case, only for so long as such
prohibition exists; provided that any such agreement, instrument or other
undertaking (i) is in existence on the Closing Date and listed on Schedule
1.01(A) (or, with respect to a Subsidiary acquired after the Closing Date, as of
the date of such acquisition) and (ii) in the case of a Subsidiary acquired
after the Closing Date, was not entered into in connection with or anticipation
of such acquisition, (e) any Subsidiary for which guaranteeing the Obligations
would require consent, approval, license or authorization from any Governmental
Authority (including, without limitation, any Gaming Authority), unless such
consent, approval, license or authorization has been received and is in effect,
(f) any Subsidiary that is a special purpose entity, (g) any not-for-profit
Subsidiaries, (h) any captive insurance Subsidiaries and (i) any other
Subsidiary with respect to which, in the reasonable judgment of Administrative
Agent and Borrower, the cost or other consequences (including any adverse tax
consequences) of providing a guarantee shall be excessive in view of the
benefits to be obtained by the Lenders therefrom.

“Excluded Swap Obligation” shall mean, with respect to any Guarantor, (x) as it
relates to all or a portion of the Guarantee of such Guarantor, any Swap
Obligation if, and to the extent that, such Swap Obligation (or any Guarantee
thereof) is or becomes illegal under the Commodity Exchange Act or any rule,
regulation or order of the Commodity Futures Trading Commission (or the
application or official interpretation of any thereof) by virtue of such
Guarantor’s failure for any reason to constitute an “eligible contract
participant” as defined in the Commodity Exchange Act and the regulations
thereunder at the time the Guarantee of such Guarantor becomes effective with
respect to such Swap Obligation or (y) as it relates to all or a portion of the
grant by such Guarantor of a security interest, any Swap Obligation if, and to
the extent that, such Swap Obligation (or such security interest in respect
thereof) is or becomes illegal under the Commodity Exchange Act or any rule,
regulation or order of the Commodity Futures Trading Commission (or the
application or official interpretation of any thereof) by virtue of such
Guarantor’s failure for any reason to constitute an “eligible contract
participant” as defined in the Commodity Exchange Act and the regulations
thereunder at the time the security interest of such Guarantor becomes effective
with respect to such Swap Obligation. If a Swap Obligation arises under a master
agreement governing more than one swap, such exclusion shall apply only to the
portion of such Swap Obligation that is attributable to swaps for which such
Guarantee or security interest is or becomes illegal.

“Excluded Taxes” shall mean all of the following Taxes imposed on or with
respect to any Agent, any Lender, or any other recipient of any payment to be
made by or on account of any obligation of any Credit Party or required to be
deducted from a payment to such recipient, in each case, under any Credit
Document, (a) income or franchise Taxes imposed on (or measured by) such
recipient’s net income or net profits (however denominated) and branch profits
Taxes, in each case, (i) imposed by a jurisdiction as a result of such recipient
being organized under the Laws of, or having its principal office or, in the
case of any Lender, its applicable lending office located in such jurisdiction
or (ii) that are Other Connection Taxes, (b) in the case of any Lender, any U.S.
federal withholding tax that is imposed on amounts payable to or for the account
of such Lender with respect to an applicable interest in a Loan or Commitment
pursuant to a Law in effect on the date on which (i) such Lender acquires such
interest in the applicable Commitment (or, to the extent a Lender acquires an
interest in a Loan not funded pursuant to a prior Commitment, acquires such
interest in such Loan) (in each case, other than pursuant to an assignment
requested by the Borrower under Section 2.11(a)) or (ii) such Lender designates
a new applicable lending office, except in each case to the extent that
additional amounts with respect to such

 

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withholding Tax were payable pursuant to Section 5.06(a) either to such Lender’s
assignor immediately before such Lender acquired the applicable interest in the
applicable Loan or Commitment or to such Lender immediately before it designated
the new applicable lending office, (c) Taxes attributable to such recipient’s
failure to comply with Section 5.06(c), and (d) any withholding Tax imposed
under FATCA. For purposes of subclause (b) of this definition, a Lender that
acquires a participation pursuant to Section 4.07(b) shall be treated as having
acquired such participation on the earlier date(s) on which such Lender acquired
the applicable interest(s) in the Commitment(s) and/or Loan(s) to which such
participation relates.

“Existing Credit Agreements” shall mean (i) the Credit Agreement, dated as of
July 31, 2015 (as amended and otherwise modified prior to the date hereof),
among Borrower, Capital One, National Association, as administrative agent, the
lenders party thereto and the other agents party thereto and (ii) the Credit and
Guaranty Agreement, dated as of July 7, 2015 (as amended and otherwise modified
prior to the date hereof), among Padre, certain Subsidiaries of Padre, Deutsche
Bank AG New York Branch, as administrative agent and collateral agent, the
lenders party thereto and the other agents party thereto.

“Existing Term Loan Tranche” shall have the meaning provided in Section 2.13(a).

“Existing Tranche” shall mean any Existing Term Loan Tranche.

“Expansion Capital Expenditures” shall mean any capital expenditure by Borrower
or any of its Restricted Subsidiaries in respect of the purchase, construction
or other acquisition of any fixed or capital assets or the refurbishment of
existing assets or properties that, in Borrower’s reasonable determination, adds
to or significantly improves (or is reasonably expected to add to or
significantly improve) the property of Borrower and its Restricted Subsidiaries,
excluding any such capital expenditures financed with Net Available Proceeds of
an Asset Sale or Casualty Event and excluding capital expenditures made in the
ordinary course made to maintain, repair, restore or refurbish the property of
Borrower and its Restricted Subsidiaries in its then existing state or to
support the continuation of such Person’s day to day operations as then
conducted.

“Extended Term Loans” shall have the meaning provided in Section 2.13(a).

“Extending Lender” shall have the meaning provided in Section 2.13(c).

“Extension Amendment” shall have the meaning provided in Section 2.13(d).

“Extension Date” shall mean any date on which any Existing Term Loan Tranche is
modified to extend the related scheduled maturity date(s) in accordance with
Section 2.13 (with respect to the Lenders under such Existing Term Loan Tranche
which agree to such modification).

“Extension Election” shall have the meaning provided in Section 2.13(c).

“Extension Request” shall mean any Term Loan Extension Request.

“Extension Tranche” shall mean all Extended Term Loans of the same tranche that
are established pursuant to the same Extension Amendment (or any subsequent
Extension Amendment to the extent such Extension Amendment expressly provides
that the Extended Term Loans provided for therein are intended to be a part of
any previously established Extension Tranche).

 

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“fair market value” shall mean, with respect to any Property, a price (after
taking into account any liabilities relating to such Property), as determined in
good faith by Borrower, that could be negotiated in an arm’s-length free market
transaction, for cash, between a willing seller and a willing and able buyer,
neither of which is under any compulsion to complete the transaction.

“Fair Share” has the meaning set forth in Section 6.10.

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of
this Agreement (or any amended or successor version that is substantively
comparable and not materially more onerous to comply with), any current or
future regulations thereunder or official interpretations thereof, any
agreements entered into pursuant to current Section 1471(b)(1) of the Code (or
any amended or successor version described above) and any fiscal or regulatory
legislation, rules or official administrative guidance adopted pursuant to any
intergovernmental agreement, treaty or convention among Governmental Authorities
implementing the foregoing.

“Federal Funds Effective Rate” shall mean, for any day, the rate calculated by
the NYFRB based on such day’s federal funds transactions by depositary
institutions, as determined in such manner as the NYFRB shall set forth on its
public website from time to time, and published on the next succeeding Business
Day by the NYFRB as the federal funds effective rate; provided, further, that if
the aforesaid rate shall be less than zero, such rate shall be deemed to be zero
for purposes of this Agreement.

“Final Maturity Date” shall mean the latest of the Term B Facility Maturity
Date, the latest New Term Loan Maturity Date, the latest final maturity date
applicable to any Extended Term Loans and the latest final maturity date
applicable to any Other Term Loans.

“FIRREA” shall mean the Financial Institutions Reform, Recovery and Enforcement
Act of 1989, as amended.

“First Lien Administrative Agent” shall mean JPMorgan Chase Bank, N.A., in its
capacity as administrative agent and collateral agent under any of the First
Lien Credit Documents, or any successor administrative agent.

“First Lien Credit Agreement” shall mean the First Lien Credit Agreement, dated
as of the date hereof, among Borrower, the Guarantors from time to time party
thereto, the First Lien Lenders party thereto from time to time, and the First
Lien Administrative Agent, as amended, restated, amended and restated,
reaffirmed, refinanced, replaced, supplemented or otherwise modified from time
to time.

“First Lien Credit Agreement Refinancing Indebtedness” shall mean the “Credit
Agreement Refinancing Indebtedness” referred to in the First Lien Credit
Agreement that is incurred in the form of additional term loans under the First
Lien Credit Agreement.

“First Lien Credit Documents” shall mean the “Credit Documents” referred to in
the First Lien Credit Agreement.

“First Lien Extended Term Loans” shall mean the “Extended Term Loans” referred
to in the First Lien Credit Agreement.

“First Lien Incremental Term Loans” shall mean the “Incremental Term Loans”
referred to in the First Lien Credit Agreement.

 

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“First Lien/Second Lien Intercreditor Agreement” shall mean an intercreditor
agreement substantially in the form of Exhibit T hereto, dated as of the Closing
Date, between Borrower, the Guarantors from time to time party thereto,
Administrative Agent, the First Lien Administrative Agent and the representative
of any other series of Indebtedness that may become a party thereto from time to
time.

“First Lien Lenders” shall mean the Persons referred to as “Lenders” in the
First Lien Credit Agreement.

“First Lien Revolving Facility” shall mean each “Revolving Facility” referred to
in the First Lien Credit Agreement.

“First Lien Revolving Loans” shall mean the loans outstanding under any First
Lien Revolving Facility.

“First Lien Term Loan Facility” shall mean the “Term B Facility” referred to in
the First Lien Credit Agreement.

“First Lien Term Loans” shall mean any Closing Date First Lien Term Loan or any
First Lien Incremental Term Loan, First Lien Credit Agreement Refinancing
Indebtedness or First Lien Extended Term Loan designated as a “Term Loan” under
the First Lien Credit Agreement, as the context may require.

“Fixed Amounts” has the meaning set forth in Section 1.08(a).

“Flood Insurance Laws” shall mean, collectively, (a) the National Flood
Insurance Act of 1968 as now or hereafter in effect or any successor statute
thereto, (b) the Flood Disaster Protection Act of 1973 as now or hereafter in
effect or any successor statue thereto, (c) the National Flood Insurance Reform
Act of 1994 as now or hereafter in effect or any successor statute thereto,
(d) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any
successor statute thereto and (e) the Biggert-Waters Flood Insurance Reform Act
of 2012 as now or hereafter in effect or any successor statute thereto.

“Foreign Plan” shall mean any employee benefit plan, program, policy,
arrangement or agreement (excluding employment agreements) maintained or
contributed to by, or entered into with, Borrower or any Restricted Subsidiary
with respect to employees employed outside the United States.

“Foreign Subsidiary” shall mean each Subsidiary that is organized under the laws
of a jurisdiction other than the United States or any state thereof, or the
District of Columbia.

“Fund” shall mean any Person (other than a natural person) that is engaged in
making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course.

“Funding Credit Party” has the meaning set forth in Section 6.10.

“Funding Date” shall mean the date of the making of any extension of credit
hereunder (including the Closing Date).

“GAAP” shall mean generally accepted accounting principles set forth as of the
relevant date in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of

 

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Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of comparable
stature and authority within the U.S. accounting profession), including, without
limitation, any Accounting Standards Codifications, which are applicable to the
circumstances as of the date of determination.

“Gaming Approval” shall mean any and all approvals, authorizations, permits,
consents, rulings, orders or directives of any Governmental Authority
(including, without limitation, any Gaming Authority) in favor of Borrower or
any of its Restricted Subsidiaries (a) necessary to enable Borrower or any of
its Restricted Subsidiaries to engage in, operate or manage the casino,
gambling, horse racing or gaming business or otherwise continue to conduct,
operate or manage such business substantially as is presently conducted,
operated or managed or contemplated to be conducted, operated or managed
following the Closing Date (after giving effect to the Transactions), (b)
required by any Gaming Law or (c) necessary as is contemplated on the Closing
Date (after giving effect to the Transactions), to accomplish the financing and
other transactions contemplated hereby after giving effect to the Transactions.

“Gaming Authority” shall mean any Governmental Authority with regulatory,
licensing or permitting authority or jurisdiction over any gaming business or
enterprise or horse racing business or enterprise or any Gaming Facility
(including, without limitation, the following as of the Closing Date: the Nevada
Gaming Commission, the Nevada State Gaming Control Board, the Montana Gambling
Control Division, the Illinois Gaming Board and the Maryland Lottery & Gaming
Control Commission), or with regulatory, licensing or permitting authority or
jurisdiction over any gaming or racing operation (or proposed gaming or racing
operation) owned, managed, leased or operated by Borrower or any of its
Restricted Subsidiaries.

“Gaming Facility” shall mean any gaming establishment and other property or
assets ancillary thereto or used in connection therewith, including, without
limitation, any casinos, hotels, resorts, race tracks, off-track wagering sites,
gambling taverns, distributed gaming locations, theaters, parking facilities,
recreational vehicle parks, timeshare operations, retail shops, restaurants,
other buildings, land, golf courses and other recreation and entertainment
facilities, marinas, vessels, barges, ships and related equipment.

“Gaming Laws” shall mean all applicable provisions of all: (a) constitutions,
treaties, statutes or laws governing Gaming Facilities and rules, regulations,
codes and ordinances of, and all administrative or judicial orders or decrees or
other laws pursuant to which, any Gaming Authority possesses regulatory,
licensing or permit authority over gambling, gaming, racing or Gaming Facility
activities conducted, operated or managed by Borrower or any of its Restricted
Subsidiaries within its jurisdiction; (b) Gaming Approvals; and (c) orders,
decisions, determinations, judgments, awards and decrees of any Gaming
Authority.

“Gaming License” shall mean any Gaming Approval or other casino, gambling, horse
racing or gaming license issued by any Gaming Authority in favor of Borrower or
any of its Restricted Subsidiaries covering any such activity at any Gaming
Facility.

“Golden Permitted Assignees” shall mean any Affiliate of any Credit Party (other
than Borrower and its Subsidiaries).

“Governmental Authority” shall mean any government or political subdivision of
the United States or any other country, whether federal, state, provincial or
local, or any agency, authority, board, bureau, central bank, commission,
office, division, department or instrumentality thereof or therein,

 

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including, without limitation, any court, tribunal, grand jury or arbitrator, in
each case whether foreign or domestic, or any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to such government or political subdivision including, without limitation, any
Gaming Authority.

“Governmental Real Property Disclosure Requirements” shall mean any Requirement
of Law requiring notification of the buyer, mortgagee or assignee of real
property, or notification, registration or filing to or with any Governmental
Authority, in connection with the sale, lease, mortgage, assignment or other
transfer (including, without limitation, any transfer of control) of any real
property, establishment or business, of the actual or threatened presence or
release in or into the Environment, or the use, disposal or handling of
Hazardous Material on, at, under or near the real property, facility or business
to be sold, mortgaged, assigned or transferred.

“Group Investors” has the meaning set forth in the definition of the term
“Permitted Holders”.

“Guarantee” shall mean the guarantee of each Guarantor pursuant to Article VI.

“Guaranteed Obligations” has the meaning set forth in Section 6.01.

“Guarantors” shall mean each of the Persons listed on Schedule 1.01(B) attached
hereto and each Restricted Subsidiary that may hereafter execute a Joinder
Agreement pursuant to Section 9.11, together with their successors and permitted
assigns, and “Guarantor” shall mean any one of them; provided, however, that
notwithstanding the foregoing, Guarantors shall not include any Person that has
been released as a Guarantor in accordance with the terms of the Credit
Documents.

“Hazardous Material” shall mean any material, substance, waste, constituent,
compound, pollutant or contaminant including, without limitation, petroleum
(including, without limitation, crude oil or any fraction thereof or any
petroleum product or waste) subject to regulation or which could reasonably be
expected to give rise to liability under Environmental Law.

“Immaterial Subsidiary” shall mean (a) as of the Closing Date, those
Subsidiaries of Borrower which are designated as such on Schedule 8.12(b), and
(b) each additional Subsidiary of Borrower which is hereafter designated as such
from time to time by written notice to Administrative Agent in a manner
consistent with the provisions of Section 9.13; provided that no Person shall be
so designated (or in the cases of clauses (i), (ii), (iii) and (iv) below, if
already designated, remain), if, as of the date of its designation (or if
already designated, as of any date following such designation) (i) (x) such
Person’s (1) Consolidated EBITDA for the then most recently ended Test Period is
in excess of 2.5% of the Consolidated EBITDA of Borrower and its Restricted
Subsidiaries or (2) Consolidated Total Assets as of the last day of the then
most recently ended Test Period is in excess of 2.5% of the Consolidated Total
Assets of Borrower and its Restricted Subsidiaries on a consolidated basis and
(y) when such Person is taken together with all other Immaterial Subsidiaries as
of such date, all such Immaterial Subsidiaries’ (1) Consolidated EBITDA for the
then most recently ended Test Period is in excess of 10.0% of the Consolidated
EBITDA of Borrower and its Restricted Subsidiaries or (2) Consolidated Total
Assets as of the last day of the then most recently ended Test Period is in
excess of 10.0% of the Consolidated Total Assets of Borrower and its Restricted
Subsidiaries on a consolidated basis, (ii) it owns any interest in any Core
Property or any Equity Interests in any Guarantor, (iii) it owns any material
assets which are used in connection with any Gaming Facility (other than a
Gaming Facility with 200 gaming machines or less), (iv) it owns any Real
Property which would be required to be a Mortgaged Real Property hereunder if
such Subsidiary were not an Immaterial Subsidiary or (v) any Default or Event of
Default has occurred and remains continuing.

 

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“Impacted Loans” has the meaning set forth in Section 5.02.

“Increased Amount” of any Indebtedness shall mean any increase in the amount of
such Indebtedness in connection with any accrual of interest, the accretion of
accreted value, the amortization of original issue discount, the payment of
interest in the form of additional Indebtedness or in the form of common stock
of Borrower, the accretion of original issue discount or liquidation preference
and increases in the amount of Indebtedness outstanding solely as a result of
fluctuations in the exchange rate of currencies.

“Incremental Commitments” shall mean the Incremental Term Loan Commitments.

“Incremental Effective Date” has the meaning set forth in Section 2.12(b).

“Incremental Incurrence-Based Amount” has the meaning set forth in the
definition of “Incremental Loan Amount”.

“Incremental Joinder Agreement” has the meaning set forth in Section 2.12(b).

“Incremental Loan Amount” shall mean, as of any date of determination:

(a) the Shared Fixed Incremental Amount; plus

(b) (x) in the case of an Incremental Commitment or Ratio Debt that serves to
effectively extend the maturity of the Term Loans, the First Lien Term Loans
and/or the First Lien Revolving Loans, an amount equal to the reductions in the
Term Loans, the First Lien Term Loans and/or the First Lien Revolving Loans to
be replaced with such Incremental Commitment or Ratio Debt, (y) in the case of
any Incremental Commitment or Ratio Debt incurred that effectively replaces any
Term Loan repaid under Section 2.11, 13.04(b) or 13.05(k), an amount equal to
the portion of the relevant repaid Term Loans and (z) in the case of any
Incremental Commitment or Ratio Debt that effectively replaces any commitment
under the First Lien Revolving Facility terminated, or any First Lien Term Loan
repaid, under Section 2.11, 13.04(b), 13.04(h) or 13.05(k) of the First Lien
Credit Agreement, an amount equal to the portion of the relevant terminated
commitments under the First Lien Revolving Facility or repaid First Lien Term
Loans; plus

(c) the aggregate amount of any voluntary prepayment or repurchase of Term
Loans, First Lien Term Loans or First Lien Revolving Loans (to the extent
accompanied by a corresponding permanent reduction of the Revolving Commitments
(as defined in the First Lien Credit Agreement) to the extent the relevant
prepayment or reduction (x) is not funded or effected with any long term
Indebtedness and (y) does not include any prepayment that is funded with the
proceeds of an Incremental Commitment incurred in reliance on clause (b) (or on
clause (b) of the Ratio Debt Amount) (the amounts under clauses (b) and (c)
together, the “Incremental Prepayment Amount”); minus the aggregate principal
amount of all Indebtedness incurred or issued in reliance on the Ratio
Prepayment Amount; plus

(d) an unlimited amount so long as, in the case of this clause (d), the
Consolidated Total Secured Net Leverage Ratio would not exceed 5.60:1.00,
calculated on a Pro Forma Basis after giving effect thereto, including the
application of proceeds thereof, as of the last day of the most recently ended
Test Period; provided that, for such purpose, such calculation shall be made
without

 

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netting the cash proceeds of any Borrowing under such Incremental Commitment
(this clause (d), the “Incremental Incurrence-Based Amount”).

It is understood and agreed that (I) Borrower may elect to use the Incremental
Incurrence-Based Amount prior to the Shared Fixed Incremental Amount or the
Incremental Prepayment Amount and regardless of whether there is capacity under
the Shared Fixed Incremental Amount or the Incremental Prepayment Amount, and if
the Shared Fixed Incremental Amount, the Incremental Prepayment Amount and the
Incremental Incurrence-Based Amount are each available and Borrower does not
make an election, Borrower will be deemed to have elected to use the Incremental
Incurrence-Based Amount; and (II) any portion of any Incremental Term Loan,
Incremental Term Loan Commitment or Ratio Debt incurred in reliance on the
Shared Fixed Incremental Amount or the Incremental Prepayment Amount shall be
reclassified as incurred under the Incremental Incurrence-Based Amount as
Borrower may elect from time to time if Borrower meets the applicable
Consolidated Total Secured Net Leverage Ratio under the Incremental
Incurrence-Based Amount at such time on a Pro Forma Basis.

“Incremental Prepayment Amount” has the meaning set forth in the definition of
“Incremental Loan Amount”.

“Incremental Term B Loan Commitments” shall have the meaning provided in
Section 2.12(a).

“Incremental Term B Loans” shall have the meaning provided in Section 2.12(a).

“Incremental Term Loan Commitments” shall mean the Incremental Term B Loan
Commitments and the New Term Loan Commitments.

“Incremental Term Loans” shall mean the Incremental Term B Loans and any New
Term Loans.

“incur” shall mean, with respect to any Indebtedness or other obligation of any
Person, to create, issue, incur (including by conversion, exchange or
otherwise), permit to exist, assume, guarantee or otherwise become liable in
respect of such Indebtedness or other obligation (and “incurrence,” “incurred”
and “incurring” shall have meanings correlative to the foregoing).

“Incurrence-Based Amounts” has the meaning set forth in Section 1.08(a).

“Indebtedness” of any Person shall mean, without duplication, (a) all
obligations of such Person for borrowed money; (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments; (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property purchased by such Person; (d) all obligations of
such Person issued or assumed as the deferred purchase price of property or
services (excluding (i) trade accounts payable and accrued obligations incurred
in the ordinary course of business, (ii) the financing of insurance premiums,
(iii) any such obligations payable solely through the issuance of Equity
Interests and (iv) any earn-out obligation until such obligation appears in the
liabilities section of the balance sheet of such Person in accordance with GAAP
(excluding disclosure on the notes and footnotes thereto); provided that any
earn-out obligation that appears in the liabilities section of the balance sheet
of such Person shall be excluded, to the extent (x) such Person is indemnified
for the payment thereof and such indemnification is not disputed or (y) amounts
to be applied to the payment therefor are in escrow); (e) all Indebtedness
(excluding prepaid interest thereon) of others secured by any Lien on property
owned or acquired by such Person, whether or not the obligations secured thereby
have been assumed; provided, however, that if such

 

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obligations have not been assumed, the amount of such Indebtedness included for
the purposes of this definition will be the amount equal to the lesser of the
fair market value of such property and the amount of the Indebtedness secured;
(f) with respect to any Capital Lease Obligations of such Person, the
capitalized amount thereof that would appear on a balance sheet of such Person
prepared as of such date in accordance with GAAP; (g) all net obligations of
such Person in respect of Swap Contracts; (h) all obligations of such Person as
an account party in respect of letters of credit and bankers’ acceptances,
except obligations in respect of letters of credit issued in support of
obligations not otherwise constituting Indebtedness shall not constitute
Indebtedness except to the extent such letter of credit is drawn and not
reimbursed within three (3) Business Days of such drawing; (i) all obligations
of such Person in respect of Disqualified Capital Stock; and (j) all Contingent
Obligations of such Person in respect of Indebtedness of others of the kinds
referred to in clauses (a) through (i) above. The Indebtedness of any Person
shall include the Indebtedness of any partnership in which such Person is a
general partner unless recourse is limited, in which case the amount of such
Indebtedness shall be the amount such Person is liable therefor (except to the
extent the terms of such Indebtedness expressly provide that such Person is not
liable therefor). The amount of Indebtedness of the type described in clause
(d) shall be calculated based on the net present value thereof. The amount of
Indebtedness of the type referred to in clause (g) above of any Person shall be
zero unless and until such Indebtedness shall be terminated, in which case the
amount of such Indebtedness shall be the then termination payment due thereunder
by such Person. For the avoidance of doubt, it is understood and agreed that
(x) casino “chips” and gaming winnings of customers, (y) any obligations of such
Person in respect of Cash Management Agreements and (z) any obligations of such
Person in respect of employee deferred compensation and benefit plans (including
Pension Plans acquired in the Padre Acquisition) shall not constitute
Indebtedness. Operating leases shall not constitute Indebtedness hereunder
regardless of whether required to be recharacterized as Capitalized Leases
pursuant to GAAP.

“Indemnitee” has the meaning set forth in Section 13.03(b).

“Initial Financial Statement Delivery Date” shall mean the date on which
Section 9.04 Financials are delivered to Administrative Agent under
Section 9.04(a) or (b), as applicable, for the first full fiscal quarter ending
after the Closing Date.

“Initial Perfection Certificate” has the meaning set forth in the definition of
“Perfection Certificate.”

“Initial Restricted Payment Base Amount” shall mean, as of any date of
determination, an amount equal to the greater of $35.0 million and 20% of
Consolidated EBITDA calculated at the time of determination on a Pro Forma Basis
as of the most recently ended Test Period minus (x) the amount of Investments
made under Section 10.04(k)(ii) on or prior to such date, (y) the amount of
Restricted Payments made under Section 10.06(i) on or prior to such date and
(z) the amount of Junior Prepayments made under Section 10.09(a)(i) on or prior
to such date.

“Intellectual Property” has the meaning set forth in Section 8.19.

“Interest Period” shall mean, as to each LIBOR Loan, the period commencing on
the date such LIBOR Loan is disbursed or converted to or continued as a LIBOR
Loan and ending on the date one, two, three or six months thereafter, as
selected by Borrower in its Notice of Borrowing or Notice of
Continuation/Conversion, as applicable, or such other period that is twelve
months or less requested by Borrower and available to and consented to by all
the applicable Lenders (and if less than one month, the consent of
Administrative Agent shall also be required); provided that:

 

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(i) any Interest Period that would otherwise end on a day that is not a Business
Day shall be extended to the next succeeding Business Day unless, in the case of
a LIBOR Loan, such Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Business Day;

(ii) any Interest Period pertaining to a LIBOR Loan that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month at the end of such
Interest Period; and

(iii) no Interest Period for a Class shall extend beyond the maturity date for
such Class.

“Interest Rate Protection Agreement” shall mean, for any Person, an interest
rate swap, cap or collar agreement or similar arrangement between such Person
and one or more financial institutions providing for the transfer or mitigation
of interest risks either generally or under specific contingencies.

“Interpolated Rate” means, at any time, for any Interest Period, the rate per
annum (rounded to the same number of decimal places as the LIBO Screen Rate)
determined by Administrative Agent (which determination shall be conclusive and
binding absent manifest error) to be equal to the rate that results from
interpolating on a linear basis between: (a) the LIBO Screen Rate for the
longest period for which the LIBO Screen Rate is available for the applicable
currency that is shorter than the Impacted Interest Period; and (b) the LIBO
Screen Rate for the shortest period for which that LIBO Screen Rate is available
for the applicable currency that exceeds the Impacted Interest Period, in each
case, at such time.

“Investments” of any Person shall mean (a) any loan or advance of funds or
credit by such Person to any other Person, (b) any Contingent Obligation by such
Person in respect of the Indebtedness or other obligation of any other Person
(provided that upon termination of any such Contingent Obligation, no Investment
in respect thereof shall be deemed outstanding, except as contemplated in clause
(e) below), (c) any purchase or other acquisition of any Equity Interests or
indebtedness or other securities of any other Person, (d) any capital
contribution by such Person to any other Person, (e) without duplication of any
amounts included under clause (b) above, any payment under any Contingent
Obligation by such Person in respect of the Indebtedness or other obligation of
any other Person or (f) the purchase or other acquisition (in one transaction or
a series of transaction) of all or substantially all of the property and assets
or business of another Person or assets constituting a business unit, line of
business or division of such Person. For purposes of the definition of
“Unrestricted Subsidiary” and Section 10.04, “Investment” shall include the
portion (proportionate to Borrower’s Equity Interest in such Subsidiary) of the
fair market value of the net assets of any Subsidiary of Borrower at the time of
Designation of such Subsidiary as an Unrestricted Subsidiary pursuant to
Section 9.12 (excluding any Subsidiaries designated as Unrestricted Subsidiaries
on the Closing Date and set forth on Schedule 9.12); provided, however, that
upon the Revocation of a Subsidiary that was Designated as an Unrestricted
Subsidiary after the Closing Date, the amount of outstanding Investments in
Unrestricted Subsidiaries shall be deemed to be reduced by the lesser of (x) the
fair market value of such Subsidiary at the time of such Revocation and (y) the
amount of Investments in such Subsidiary deemed to have been made (directly or
indirectly) at the time of, and made (directly or indirectly) since, the
Designation of such Subsidiary as an Unrestricted Subsidiary, to the extent that
such amount constitutes an outstanding Investment under clauses (d), (i), (k),
(l), (m), (s) or (t) of Section 10.04 at the time of such Revocation.

“IRS” shall mean the United States Internal Revenue Service.

 

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“Joinder Agreements” shall mean each Joinder Agreement substantially in the form
of Exhibit M attached hereto or such other form as is reasonably acceptable to
Administrative Agent and each Joinder Agreement to be entered into pursuant to
the Security Agreement.

“Joint Venture” shall mean any Person, other than an individual or a Wholly
Owned Subsidiary of Borrower, in which Borrower or a Restricted Subsidiary of
Borrower (directly or indirectly) holds or acquires an ownership interest
(whether by way of capital stock, partnership or limited liability company
interest, or other evidence of ownership).

“Junior Financing” shall mean unsecured Indebtedness (including unsecured
Indebtedness convertible into or exchangeable or exercisable for any Equity
Interests) of Borrower or all or any Restricted Subsidiaries (a) (i) that is
subordinated in right of payment to the Loans and contains subordination
provisions that are customary in the good faith determination of Borrower for
senior subordinated notes or subordinated notes issued under Rule 144A of the
Securities Act (or other corporate issuers in private placements or public
offerings of securities) or (ii) that contains subordination provisions
reasonably satisfactory to Administrative Agent, (b) that shall not have a
scheduled maturity date or any scheduled principal payments or be subject to any
mandatory redemption, prepayment, or sinking fund (except for customary change
of control provisions and, in the case of bridge facilities, customary mandatory
redemptions or prepayments with proceeds of Permitted Refinancings thereof
(which Permitted Refinancings would constitute Junior Financing) or Equity
Issuances, and customary asset sale provisions that permit application of the
applicable proceeds to the payment of the Obligations prior to application to
such Junior Financing) due prior to the date that is 91 days after the Final
Maturity Date then in effect at the time of issuance (excluding bridge
facilities allowing extensions on customary terms to at least 91 days after such
Final Maturity Date) and (c) the terms (excluding pricing, fees, rate floors,
premiums, optional prepayment or optional redemption provisions) of which are
(as determined by Borrower in good faith), taken as a whole, no more restrictive
in any material respect to Borrower and its Restricted Subsidiaries than the
terms set forth in this Agreement (other than, in the case of any bridge
facility, covenants, defaults and remedy provisions customary for bridge
financings).

“Junior Prepayments” shall have the meaning provided in Section 10.09.

“Laws” shall mean, collectively, all common law and all international, foreign,
federal, state and local statutes, treaties, rules, guidelines, regulations,
ordinances, codes and administrative or judicial precedents, including without
limitation the interpretation thereof by any Governmental Authority charged with
the enforcement thereof.

“LCT Election” shall have the meaning provided in Section 1.07.

“LCT Test Date” shall have the meaning provided in Section 1.07.

“Lead Arrangers” shall mean JPMorgan Chase Bank, N.A., Credit Suisse Securities
(USA) LLC, Macquarie Capital (USA) Inc. and Morgan Stanley Senior Funding, Inc.,
in their capacities as joint lead arrangers and joint bookrunners hereunder.

“Lease” shall mean any lease, sublease, franchise agreement, license, occupancy
or concession agreement.

“Lender Insolvency Event” shall mean that (i) a Lender or its Parent Company is
insolvent, or is generally unable to pay its debts as they become due, or admits
in writing its inability to pay its debts as they become due, or makes a general
assignment for the benefit of its creditors, or (ii) such Lender or its

 

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Parent Company is the subject of a proceeding under any Debtor Relief Law, or a
receiver, trustee, conservator, intervenor, administrator, sequestrator,
assignee for the benefit of creditors or similar Person charged with
reorganization or liquidation of its business or assets (including the Federal
Deposit Insurance Corporation or any other state or federal regulatory
authority) has been appointed for such Lender or its Parent Company, or such
Lender or its Parent Company has taken any action authorizing or indicating its
consent to or acquiescence in any such proceeding or appointment; provided,
however, that a Lender Insolvency Event shall not be deemed to exist solely as
the result of the acquisition or maintenance of an ownership interest in such
Lender or its Parent Company by a Governmental Authority or an instrumentality
thereof so long as such ownership interest does not result in or provide such
Lender with immunity from the jurisdiction of courts within the United States or
from the enforcement of judgments or writs of attachment on its assets or permit
such Lender (or such Governmental Authority) to reject, repudiate, disavow or
disaffirm any contracts or agreements made with such Lender.

“Lenders” shall mean (a) each Person listed on Annex A, (b) any Lender providing
an Incremental Commitment pursuant to Section 2.12 and any Person that becomes a
Lender from time to time party hereto pursuant to Section 2.15 and (c) any
Person that becomes a “Lender” hereunder pursuant to an Assignment Agreement, in
each case, other than any such Person that ceases to be a Lender pursuant to an
Assignment Agreement or a Borrower Assignment Agreement.

“LIBO Base Rate” shall mean, with respect to any LIBOR Loan for any Interest
Period therefor, the London interbank offered rate (“LIBOR”) as administered by
ICE Benchmark Administration Limited (or any other Person that takes over the
administration of such rate for Dollars for a period equal in length to such
Interest Period) as displayed on pages LIBOR01 or LIBOR02 of the Reuters screen
that displays such rate (or, in the event such rate does not appear on a Reuters
page or screen, on any successor or substitute page on such screen that displays
such rate, or on the appropriate page of such other information service that
publishes such rate from time to time as selected by Administrative Agent in its
reasonable discretion (in each case the “LIBO Screen Rate”) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period (for delivery on the first day of such Interest Period);
provided that, if the LIBO Screen Rate shall be less than zero, such rate shall
be deemed to be zero for the purposes of this Agreement and provided, further,
if the LIBO Screen Rate shall not be available at such time for such Interest
Period (an “Impacted Interest Period”), then the LIBO Base Rate shall be the
Interpolated Rate, provided, that, if any Interpolated Rate shall be less than
zero, such rate shall be deemed to be zero for purposes of this Agreement;
provided that to the extent a comparable or successor rate is approved by
Administrative Agent in connection herewith, the approved rate shall be
consistent with market practice for LIBOR-based loans (and the application of
such rate shall also be in accordance with market practice); provided, further
that to the extent such market practice is not administratively feasible for
Administrative Agent, such approved rate shall be applied in a manner as
otherwise reasonably determined by Administrative Agent. Notwithstanding the
foregoing, the LIBO Base Rate shall not be less than 0.00%.

“LIBO Rate” shall mean, for any LIBOR Loan for any Interest Period therefor, a
rate per annum (rounded upwards, if necessary, to the nearest 1/100th of 1%)
equal to the LIBO Base Rate for such Loan for such Interest Period multiplied by
the Statutory Reserve Rate for such Loan for such Interest Period.
Notwithstanding the foregoing, (a) for purposes of clause (c) of the definition
of Alternate Base Rate, the rates referred to above shall be the rates as of
11:00 a.m., London, England time, on the date of determination (rather than the
second Business Day preceding the date of determination) and (b) the LIBO Rate
for Term B Facility Loans shall not be less than 0.75%.

“LIBOR Loans” shall mean Loans that bear interest at rates based on rates
referred to in the definition of “LIBO Rate.”

 

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“License Revocation” shall mean the revocation, failure to renew or suspension
of, or the appointment of a receiver, supervisor or similar official with
respect to, any Gaming License covering any Gaming Facility owned, leased,
operated or used by Borrower or any of its Restricted Subsidiaries.

“Lien” shall mean, with respect to any Property, any mortgage, deed of trust,
lien, pledge, security interest, or assignment, hypothecation or encumbrance for
security of any kind, or any filing of any financing statement under the UCC or
any other similar notice of lien under any similar notice or recording statute
of any Governmental Authority (other than such financing statement or similar
notices filed for informational or precautionary purposes only), or any
conditional sale or other title retention agreement or any lease in the nature
thereof.

“Limited Condition Transaction” shall have the meaning provided in Section 1.07.

“Liquor Authority” has the meaning set forth in Section 13.13(a).

“Liquor Laws” has the meaning set forth in Section 13.13(a).

“Loans” shall mean the Term Loans.

“Losses” of any Person shall mean the losses, liabilities, claims (including
those based upon negligence, strict or absolute liability and liability in
tort), damages, reasonable expenses, obligations, penalties, actions, judgments,
penalties, fines, suits, reasonable and documented costs or disbursements
(including reasonable fees and expenses of one primary counsel for the Secured
Parties collectively, and any special gaming and local counsel reasonably
required in any applicable jurisdiction (and solely in the case of an actual or
perceived conflict of interest, where the Persons affected by such conflict
inform Borrower in writing of the existence of an actual or perceived conflict
of interest prior to retaining additional counsel, one additional of each such
counsel for each group of similarly situated Secured Parties), in connection
with any Proceeding commenced or threatened in writing, whether or not such
Person shall be designated a party thereto) at any time (including following the
payment of the Obligations) incurred by, imposed on or asserted against such
Person.

“Margin Stock” shall mean margin stock within the meaning of Regulation T,
Regulation U and Regulation X.

“Material Adverse Effect” shall mean (a) a material adverse effect on the
business, assets, financial condition or results of operations of Borrower and
its Restricted Subsidiaries, taken as a whole and after giving effect to the
Transactions, (b) a material adverse effect on the ability of the Credit Parties
to satisfy their material payment Obligations under the Credit Documents or
(c) a material adverse effect on the legality, binding effect or enforceability
against any material Credit Party to which it is a party or any of the material
rights and remedies of any Secured Party thereunder or the legality, priority or
enforceability of the Liens on a material portion of the Collateral.

“Material Indebtedness” shall mean any Indebtedness the outstanding principal
amount of which is in excess of $30.0 million.

“Material Real Property” shall mean any Real Property located in the United
States with a fair market value in excess of $5.0 million at the Closing Date
or, with respect to Real Property acquired after the Closing Date, at the time
of acquisition, in each case, as reasonably estimated by Borrower in good faith;
provided that in no case shall Material Real Property include any Route
Agreement (or real property associated therewith) or any interest in real
property associated with distributed gaming ownership or

 

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operations. For the avoidance of doubt, “Material Real Property” shall include
each Real Property described on Schedule 1.01(C).

“Maximum Rate” has the meaning set forth in Section 13.18.

“Moody’s” shall mean Moody’s Investors Service, Inc., or any successor entity
thereto.

“Mortgage” shall mean an agreement, including, but not limited to, a mortgage,
deed of trust or any other document, creating and evidencing a second Lien
(subject only to the Permitted Liens) in favor of Collateral Agent on behalf of
the Secured Parties on each Mortgaged Real Property, which shall be in
substantially the form of Exhibit I or such other form as is reasonably
acceptable to Administrative Agent, with such schedules and including such
provisions as shall be necessary to conform such document to applicable or local
law or as shall be customary under local law, as the same may at any time be
amended in accordance with the terms thereof and hereof and such changes thereto
as shall be reasonably acceptable to Administrative Agent.

“Mortgaged Real Property” shall mean (a) each Real Property listed on Schedule
1.01(C) and (b) each Real Property, if any, which shall be subject to a Mortgage
delivered on or after the Closing Date pursuant to Section 9.08, 9.11 or 9.15
(in each case, unless and until such Real Property is no longer subject to a
Mortgage).

“Mortgaged Vessel” shall mean each Vessel or Replacement Vessel, if any, which
shall be subject to a Ship Mortgage after the Closing Date pursuant to
Section 9.08 or 9.11 (in each case, unless and until such Vessel or Replacement
Vessel is no longer subject to a Ship Mortgage).

“Multiemployer Plan” shall mean a multiemployer plan within the meaning of
Section 4001(a)(3) of ERISA (a) to which any ERISA Entity is then making or
accruing an obligation to make contributions, (b) to which any ERISA Entity has
within the preceding five plan years made contributions, including any Person
which ceased to be an ERISA Entity during such five year period or (c) with
respect to which any Company is reasonably likely to incur liability under Title
IV of ERISA.

“NAIC” shall mean the National Association of Insurance Commissioners.

“Net Available Proceeds” shall mean:

(i) in the case of any Asset Sale pursuant to Section 10.05(c), the aggregate
amount of all cash payments (including any cash payments received by way of
deferred payment of principal pursuant to a note or otherwise, but only as and
when received) received by Borrower or any Restricted Subsidiary directly or
indirectly in connection with such Asset Sale, net (without duplication) of
(A) the amount of all reasonable fees and expenses and transaction costs paid by
or on behalf of Borrower or any Restricted Subsidiary in connection with such
Asset Sale (including, without limitation, any underwriting, brokerage or other
customary selling commissions and legal, advisory and other fees and expenses,
including survey, title and recording expenses, transfer taxes and expenses
incurred for preparing such assets for sale, associated therewith); (B) any
Taxes paid or estimated in good faith to be payable by or on behalf of any
Company as a result of such Asset Sale (after application of all credits and
other offsets that arise from such Asset Sale); (C) any repayments by or on
behalf of any Company of Indebtedness (other than Indebtedness hereunder) to the
extent such Indebtedness is secured by a Lien on such Property that is permitted
by the Credit Documents and that is not junior to the Lien thereon securing the
Obligations and such Indebtedness is required to be repaid as a condition to

 

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the purchase or sale of such Property; (D) amounts required to be paid to any
Person (other than any Company) owning a beneficial interest in the subject
Property; and (E) amounts reserved, in accordance with GAAP, against any
liabilities associated with such Asset Sale and retained by Borrower or any of
its Subsidiaries after such Asset Sale and related thereto, including pension
and other post-employment benefit liabilities, purchase price adjustments,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale, all as reflected in
an Officer’s Certificate delivered to Administrative Agent; provided, that no
such amounts shall constitute Net Available Proceeds under this clause
(i) unless (x) the aggregate value of the Property sold in any single Asset Sale
or related series of Asset Sales is greater than or equal to $10.0 million (and
only net cash proceeds in excess of such amount shall constitute Net Available
Proceeds under this clause (i)) or (y) the aggregate value of all Property sold
in Asset Sales in any fiscal year exceeds $20.0 million (and thereafter only net
cash proceeds in excess of such amount shall constitute Net Available Proceeds
under this clause (i)); provided, further, that Net Available Proceeds shall
include any cash payments received upon the reversal (without the satisfaction
of any applicable liabilities in cash in a corresponding amount) of any reserve
described in clause (E) of this clause (i) or, if such liabilities have not been
satisfied in cash and such reserve is not reversed within eighteen (18) months
after such Asset Sale, the amount of such reserve;

(ii) in the case of any Casualty Event, the aggregate amount of cash proceeds of
insurance, condemnation awards and other compensation (excluding proceeds
constituting business interruption insurance or other similar compensation for
loss of revenue, but including the proceeds of any disposition of Property
pursuant to Section 10.05(l)) received by the Person whose Property was subject
to such Casualty Event in respect of such Casualty Event net of (A) fees and
expenses incurred by or on behalf of Borrower or any Restricted Subsidiary in
connection with recovery thereof, (B) any repayments by or on behalf of any
Company of Indebtedness (other than Indebtedness hereunder) to the extent such
Indebtedness is secured by a Lien on such Property that is permitted by the
Credit Documents and that is not junior to the Lien thereon securing the
Obligations and such Indebtedness is required to be repaid as a result of such
Casualty Event, and (C) any Taxes paid or payable by or on behalf of Borrower or
any Restricted Subsidiary in respect of the amount so recovered (after
application of all credits and other offsets arising from such Casualty Event)
and amounts required to be paid to any Person (other than any Company) owning a
beneficial interest in the subject Property; provided, that no such amounts
shall constitute Net Available Proceeds under this clause (ii) unless (x) the
aggregate proceeds or other compensation in respect of any single Casualty Event
is greater than or equal to $10.0 million (and only net cash proceeds in excess
of such amount shall constitute Net Available Proceeds under this clause (ii))
or (y) the aggregate proceeds or other compensation in respect of all Casualty
Events in any fiscal year exceeds $20.0 million (and thereafter only net cash
proceeds in excess of such amount shall constitute Net Available Proceeds under
this clause (ii)); provided that, in the case of a Casualty Event with respect
to property that is subject to a lease entered into for the purpose of, or with
respect to, operating or managing gaming facilities and related assets, such
cash proceeds shall not constitute Net Available Proceeds to the extent, and for
so long as, such cash proceeds are required, by the terms of such lease, (x) to
be paid to the holder of any mortgage, deed of trust or other security agreement
securing indebtedness of the lessor or (y) to be paid to, or for the account of,
the lessor or deposited in an escrow account to fund rent and other amounts due
with respect to such property and costs to preserve, stabilize, repair, replace
or restore such property (in accordance with the provisions of the applicable
lease); and

 

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(iii) in the case of any Debt Issuance or Equity Issuance, the aggregate amount
of all cash received in respect thereof by the Person consummating such Debt
Issuance or Equity Issuance in respect thereof net of all investment banking
fees, discounts and commissions, legal fees, consulting fees, accountants’ fees,
underwriting discounts and commissions and other fees and expenses, actually
incurred in connection therewith.

“New Term Loan Commitments” has the meaning set forth in Section 2.12(a).

“New Term Loan Facility” shall mean each credit facility comprising New Term
Loan Commitments and New Term Loans of a particular Tranche, if any.

“New Term Loan Maturity Date” shall mean, with respect to any New Term Loans to
be made pursuant to the related Incremental Joinder Agreement, the maturity date
thereof as determined in accordance with Section 2.12(b).

“New Term Loan Notes” shall mean the promissory notes executed and delivered in
connection with any New Term Loan Commitments and the related New Term Loans.

“New Term Loans” has the meaning set forth in Section 2.12(a).

“Non-Defaulting Lender” shall mean each Lender other than a Defaulting Lender.

“Non-Credit Party” and “Non-Credit Parties” shall mean any Subsidiary or
Subsidiaries of Borrower that is not a Credit Party or are not Credit Parties.

“Non-Credit Party Cap” shall mean, at any time, an amount equal to (i) the
greater of $42.0 million and 25% of Consolidated EBITDA calculated at the time
of determination on a Pro Forma Basis as of the most recently ended Test Period,
in the aggregate minus (ii) the then outstanding aggregate principal amount of
Indebtedness incurred (or being incurred concurrent with any determination of
the Non-Credit Party Cap) pursuant to Sections 10.01(t), 10.01(q) and 10.01(v).

“Non-U.S. Lender” has the meaning set forth in Section 5.06(b)(ii).

“Notes” shall mean the Term Loan Notes.

“Notice of Borrowing” shall mean a notice of borrowing substantially in the form
of Exhibit B or such other form as is reasonably acceptable to Administrative
Agent.

“Notice of Continuation/Conversion” shall mean a notice of
continuation/conversion substantially in the form of Exhibit C or such other
form as is reasonably acceptable to Administrative Agent.

“NYFRB” shall mean the Federal Reserve Bank of New York.

“NYFRB Rate” shall mean, for any day, the greater of (a) the Federal Funds
Effective Rate in effect on such day and (b) the Overnight Bank Funding Rate in
effect on such day (or for any day that is not a Business Day, for the
immediately preceding Business Day); provided that if none of such rates are
published for any day that is a Business Day, the term “NYFRB Rate” shall mean
the rate for a federal funds transaction quoted at 11:00 a.m. on such day
received by Administrative Agent from a Federal

 

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funds broker of recognized standing selected by it; provided, further, that if
any of the aforesaid rates shall be less than zero, such rate shall be deemed to
be zero for purposes of this Agreement.

“Obligations” shall mean all amounts, liabilities and obligations, direct or
indirect, contingent or absolute, of every type or description, and at any time
existing, owing by any Credit Party to any Secured Party or any of its Agent
Related Parties or their respective successors, transferees or assignees
pursuant to the terms of any Credit Document (including interest, fees and
expenses accruing or obligations incurred during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether
allowed or allowable in such proceeding), whether or not the right of such
Person to payment in respect of such obligations and liabilities is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured and whether or not
such claim is discharged, stayed or otherwise affected by any bankruptcy case or
insolvency or liquidation proceeding.

“Officer’s Certificate” shall mean, as applied to any entity, a certificate
executed on behalf of such entity (or such entity’s manager or member or general
partner, as applicable) by its chairman of the board of directors (or functional
equivalent) (if an officer), its chief executive officer, its president, any of
its vice presidents, its chief financial officer, its chief accounting officer
or its treasurer or controller (in each case, or an equivalent officer) in their
official (and not individual) capacities.

“Open Market Assignment and Assumption Agreement” shall mean an Open Market
Assignment and Assumption Agreement substantially in the form attached as
Exhibit P hereto or such other form as is reasonably acceptable to
Administrative Agent.

“Organizational Document” shall mean, relative to any Person, its certificate of
incorporation, its certificate of formation, its certificate of partnership, its
by-laws, its partnership agreement, its limited liability company agreement, its
memorandum or articles of association, share designations or similar
organization documents and all shareholder agreements, voting trusts and similar
arrangements applicable to any of its authorized Equity Interests.

“Other Applicable Indebtedness” shall mean Indebtedness incurred pursuant to
Section 10.01(c), (h), (k), (n), (q), (u), (v) and (w).

“Other Debt” has the meaning set forth in the definition of “Repricing
Transaction.”

“Other First Lien Indebtedness” shall mean outstanding Indebtedness that is not
incurred under the First Lien Credit Agreement and that (a) is secured by the
Collateral on a senior basis to the Obligations and (b) is “Permitted First
Priority Refinancing Debt” (as defined in the First Lien Credit Agreement) or
Ratio Debt.

“Other Junior Indebtedness” shall mean Permitted Unsecured Refinancing Debt,
Indebtedness incurred pursuant to Section 10.01(q) or Ratio Debt that is secured
by a Lien on Collateral junior to the Liens securing the Obligations or that is
unsecured.

“Other Junior Indebtedness Documentation” shall mean the documentation governing
any Other Junior Indebtedness.

“Other Second Lien Indebtedness” shall mean outstanding Indebtedness that is not
incurred under this Agreement and that (a) is secured by the Collateral on a
pari passu basis with the Obligations and (b) is Permitted Second Priority
Refinancing Debt or Ratio Debt.

 

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“Other Connection Taxes” shall mean, with respect to any Agent, any Lender or
any other recipient of any payment to be made by or on account of any obligation
of any Credit Party under any Credit Document, Taxes imposed as a result of a
present or former connection between such recipient and the jurisdiction
imposing such Tax (other than connections arising from such recipient having
executed, delivered, become a party to, performed its obligations under,
received payments under, received or perfected a security interest under,
engaged in any other transaction pursuant to or enforced any Credit Document, or
sold or assigned an interest in any Loan or Credit Document).

“Other Taxes” has the meaning set forth in Section 5.06(b).

“Other Term Loan Commitments” shall mean one or more Tranches of term loan
commitments hereunder that result from a Refinancing Amendment.

“Other Term Loans” shall mean one or more Tranches of Term Loans that result
from a Refinancing Amendment.

“Overnight Bank Funding Rate” shall mean, for any day, the rate comprised of
both overnight federal funds and overnight Eurodollar borrowings by U.S.-managed
banking offices of depository institutions (as such composite rate shall be
determined by the NYFRB as set forth on its public website from time to time),
and published on the next succeeding Business Day by the NYFRB as an overnight
bank funding rate (from and after such date as the NYFRB shall commence to
publish such composite rate).

“Padre” shall mean American Casino & Entertainment Properties, LLC, a Delaware
limited liability company.

“Padre Acquisition” shall mean the anticipated or consummated acquisition by
Borrower, directly or indirectly, of Padre pursuant to the Padre Acquisition
Agreement.

“Padre Acquisition Agreement” shall mean the Membership Interest Purchase
Agreement, dated as of June 10, 2017 (as amended, supplemented or otherwise
modified from time to time, including all exhibits and schedules attached
thereto), among Borrower and the Padre Sellers.

“Padre Material Adverse Effect” shall mean a “Company Material Adverse Effect”
(as defined in Padre Acquisition Agreement as in effect on June 10, 2017).

“Padre Sellers” shall mean W2007/ACEP Managers Voteco, LLC, a Delaware limited
liability company, and W2007/ACEP Holdings, LLC, a Delaware limited liability
company.

“Paid in Full” or “Payment in Full” and any other similar terms, expressions or
phrases shall mean, at any time, (a) with respect to obligations other than the
Obligations or the Secured Obligations (as defined in the Security Agreement),
the payment in full of all of such obligations and (b) with respect to the
Obligations or the Secured Obligations (as defined in the Security Agreement),
the irrevocable termination of all Commitments, the payment in full in cash of
all Obligations (except Unasserted Obligations), including principal, interest,
fees, expenses, costs (including post-petition interest, fees, expenses, and
costs even if such interest, fees, expenses and costs are not an allowed claim
enforceable against any Credit Party in a bankruptcy case under applicable law)
and premium (if any). For purposes of this definition, “Unasserted Obligations”
shall mean, at any time, contingent indemnity obligations in respect of which no
claim or demand for payment has been made at such time.

 

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“Parent Company” shall mean, with respect to a Lender, the bank holding company
(as defined in Federal Reserve Board Regulation Y), if any, of such Lender,
and/or any Person owning, beneficially or of record, directly or indirectly, a
majority of the shares of such Lender.

“Pari Passu Intercreditor Agreement” shall mean an intercreditor agreement
substantially in the form of Exhibit S hereto or such other form as is
reasonably acceptable to Administrative Agent.

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA, or any successor thereto.

“Pension Plan” shall mean an employee pension benefit plan (other than a
Multiemployer Plan) that is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Code or Section 302 of ERISA
and is maintained or contributed to by any ERISA Entity or with respect to which
any Company is reasonably likely to incur liability under Title IV of ERISA.

“Perfection Certificate” shall mean that certain Perfection Certificate, dated
as of the Closing Date (the “Initial Perfection Certificate”), executed and
delivered by Borrower on behalf of Borrower and each of the Guarantors existing
on the initial Funding Date, and each other Perfection Certificate (which shall
be substantially in the form of Exhibit N or such other form as is reasonably
acceptable to Administrative Agent) executed and delivered by the applicable
Credit Party from time to time, in each case, as the same may be amended,
amended and restated, supplemented or otherwise modified from time to time in
accordance with Section 9.04(h)(ii).

“Permits” has the meaning set forth in Section 8.15.

“Permitted Acquisition” shall mean any acquisition, whether by purchase, merger,
consolidation or otherwise, by Borrower or any of its Restricted Subsidiaries of
all or substantially all of the business, property or assets of, or of more than
50% of the Equity Interests in, a Person or any division or line of business of
a Person so long as (a) immediately after a binding contract with respect
thereto is entered into between Borrower or one of its Restricted Subsidiaries
and the seller with respect thereto and after giving pro forma effect to such
acquisition and related transactions, no Event of Default has occurred and is
continuing or would result therefrom, (b) immediately after giving effect
thereto, Borrower shall be in compliance with Section 10.11, (c) in the case of
a Permitted Acquisition consisting of a purchase or acquisition of the Equity
Interests in any Person that does not become a Guarantor hereunder (except to
the extent becoming a Guarantor is prohibited by applicable Gaming Laws) or of
an acquisition by a Person that is not Borrower or a Guarantor (and does not
become a Guarantor) hereunder, the consideration (excluding Equity Interests in
Borrower) paid in all such Permitted Acquisitions shall not exceed an aggregate
amount equal to the sum of (i) $42.0 million during the term of this Agreement
plus (ii) the amounts available for Investments set forth in Section 10.04(k)
and (d) with respect to a Permitted Acquisition in excess of $60.0 million,
Borrower has delivered to Administrative Agent an Officer’s Certificate to the
effect set forth in clauses (a), (b) and (c) above, together with all relevant
financial information for the Person or assets to be acquired.

“Permitted Business” shall mean any business of the type in which Borrower and
its Restricted Subsidiaries are engaged or proposed to be engaged on the date of
this Agreement, or any business reasonably related, incidental or ancillary
thereto (including assets or businesses complementary thereto).

“Permitted Business Assets” shall mean (a) one or more Permitted Businesses,
(b) a controlling equity interest in any Person whose assets consist primarily
of one or more Permitted Businesses, (c) assets that are used or useful in a
Permitted Business or (d) any combination of the preceding clauses (a),

 

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(b) and (c), in each case, as determined by Borrower’s Board of Directors or a
Responsible Officer or other management of Borrower or the Restricted Subsidiary
acquiring such assets, in each case, in its good faith judgment.

“Permitted Equity Issuance” shall mean any issuance of Equity Interests (other
than Disqualified Capital Stock) by Borrower.

“Permitted Holder” shall mean (a) Mr. Blake Sartini, Mr. Lyle Berman and
Mr. Neil Sell and, in each case, their immediate family members, lineal
descendants, heirs, estates, trusts and entities related thereto, associated
therewith or for the benefit thereof and (b) any Person with which one or more
of the foregoing Persons set forth in clause (a) (such Persons described in
clause, the “Group Investors”) form a “group” (within the meaning of
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor
provision) so long as, in the case of this clause (b), the relevant Group
Investors (taken as a whole) directly or indirectly beneficially own more than
50% of the relevant voting power of the issued and outstanding voting stock of
Borrower owned by such “group”.

“Permitted Junior Debt Conditions” shall mean that such applicable debt (i) does
not have a scheduled maturity date prior to the date that is 91 days after the
Final Maturity Date then in effect at the time of issuance (excluding bridge
facilities allowing extensions on customary terms to at least 91 days after such
Final Maturity Date), (ii) does not have a Weighted Average Life to Maturity
(excluding the effects of any prepayments of Term Loans reducing amortization)
that is shorter than that of any outstanding Term Loans (excluding bridge
facilities allowing extensions on customary terms to at least ninety-one
(91) days after the Final Maturity Date), (iii) shall not have any scheduled
principal payments or be subject to any mandatory redemption, prepayment, or
sinking fund (except for customary change of control (and, in the case of
convertible or exchangeable debt instruments, delisting) provisions (and, in the
case of bridge facilities, customary mandatory redemptions or prepayments with
proceeds of Permitted Refinancings thereof (which Permitted Refinancings would
satisfy the Permitted Junior Debt Conditions) or Equity Issuances), and
customary asset sale provisions and excess cash flow prepayment provisions that
permit application of the applicable proceeds to the payment of the Obligations
prior to application to such Junior Financing) due prior to the date that is
ninety-one (91) days after the Final Maturity Date then in effect at the time of
issuance (excluding bridge facilities allowing extensions on customary terms to
at least ninety-one (91) days after such Final Maturity Date), (iv) is not at
any time guaranteed by any Subsidiaries other than Subsidiaries that are
Guarantors and (v) has terms (excluding maturity, amortization, pricing, fees,
rate floors, premiums, optional prepayment or optional redemption provisions)
that are (as determined by Borrower in good faith) substantially identical to
the terms of the Term B Facility Loans as existing on the date of incurrence of
such Indebtedness except, to the extent such terms (x) at the option of Borrower
(1) reflect market terms and conditions (taken as a whole) at the time of
incurrence or issuance (as determined by Borrower in good faith); provided that,
if any financial maintenance covenant is added for the benefit of any such
Indebtedness constituting term loans, such financial maintenance covenant shall
also be applicable to the Term B Facility Loans (except to the extent such
financial maintenance covenant applies only to periods after the Final Maturity
Date), (2) with respect to any such Indebtedness that is unsecured, are
customary for issuances of “high yield” securities; provided that, if any
financial maintenance covenant is added for the benefit of any such
Indebtedness, such financial maintenance covenant shall also be applicable to
the Term B Facility Loans (except to the extent such financial maintenance
covenant applies only to periods after the Final Maturity Date), or (3) are not
materially more restrictive to Borrower (as determined by Borrower in good
faith), when taken as a whole, than the terms of the Term B Facility Loans
(except for covenants or other provisions applicable only to periods after the
Final Maturity Date applicable to the Term B Facility Loans) (it being
understood that any such Indebtedness may provide for the ability to participate
(i) with respect to any borrowings, voluntary prepayments or voluntary
commitment reductions, on a pro rata basis, greater than

 

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pro rata basis or less than pro rata basis with the applicable Loans or facility
and (ii) with respect to any mandatory prepayments on a less than pro rata basis
with the applicable Loans (and on a greater than pro rata basis with respect to
prepayments of any such Indebtedness with the proceeds of permitted refinancing
Indebtedness), or (y) are (1) added to the Term B Facility Loans, (2) applicable
only after the Final Maturity Date or (3) otherwise reasonably satisfactory to
Administrative Agent (it being understood that to the extent any financial
maintenance covenant is added for the benefit of any such Indebtedness, no
consent shall be required from Administrative Agent or any of the Lenders to the
extent that such financial maintenance covenant (together with any related
“equity cure” provisions) is also added for the benefit of any corresponding
existing facility). For the avoidance of doubt, the usual and customary terms of
convertible or exchangeable debt instruments issued in a registered offering or
under Rule 144A of the Securities Act shall be deemed to be no more restrictive
in any material respect to Borrower and its Restricted Subsidiaries than the
terms set forth in this Agreement, so long as the terms of such instruments do
not include any financial maintenance covenant.

“Permitted Liens” has the meaning set forth in Section 10.02.

“Permitted Refinancing” shall mean, with respect to any Indebtedness, any
refinancing thereof; provided that: (a) no Default or Event of Default shall
have occurred and be continuing or would arise therefrom; (b) any such
refinancing Indebtedness shall (i) not have a stated maturity or, other than in
the case of a revolving credit facility, a Weighted Average Life to Maturity
that is shorter than that of the Indebtedness being refinanced (determined
without giving effect to the impact of prepayments on amortization of term
Indebtedness being refinanced), (ii) if the Indebtedness being refinanced is
subordinated to the Obligations by its terms or by the terms of any agreement or
instrument relating to such Indebtedness, be at least as subordinate to the
Obligations as the Indebtedness being refinanced (and unsecured if the
refinanced Indebtedness is unsecured) and (iii) be in a principal amount that
does not exceed the principal amount so refinanced, plus, accrued interest,
plus, any premium or other payment required to be paid in connection with such
refinancing, plus, the amount of fees and expenses of Borrower or any of its
Restricted Subsidiaries incurred in connection with such refinancing, plus, any
unutilized commitments thereunder; and (c) the obligors on such refinancing
Indebtedness shall be the obligors on such Indebtedness being refinanced;
provided, however, that (i) the borrower of the refinancing indebtedness shall
be Borrower or the borrower of the indebtedness being refinanced and (ii) any
Credit Party shall be permitted to guarantee any such refinancing Indebtedness
of any other Credit Party.

“Permitted Second Priority Refinancing Debt” shall mean secured Indebtedness
incurred by Borrower (and Contingent Obligations of the Guarantors in respect
thereof) in the form of one or more series of second lien (or other junior lien)
secured notes or second lien (or other junior lien) secured loans; provided that
(a) such Indebtedness is secured by the Collateral on a pari passu (or junior
priority) basis to the liens securing the Obligations and is not secured by any
property or assets of Borrower or any Restricted Subsidiary other than the
Collateral, (b) such Indebtedness constitutes Credit Agreement Refinancing
Indebtedness (provided, that such Indebtedness may be secured by a Lien on the
Collateral that is pari passu or junior to the Liens securing the Obligations,
notwithstanding any provision to the contrary contained in the definition of
“Credit Agreement Refinancing Indebtedness”) and (c) the holders of such
Indebtedness (or their representative) shall be party to the Pari Passu
Intercreditor Agreement with Administrative Agent.

“Permitted Unsecured Refinancing Debt” shall mean unsecured Indebtedness
incurred by Borrower or its Restricted Subsidiaries in the form of one or more
series of senior unsecured notes or loans; provided that such Indebtedness
(a) constitutes Credit Agreement Refinancing Indebtedness and (b) meets the
Permitted Junior Debt Conditions.

 

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“Permitted Vessel Liens” shall mean maritime Liens on ships, barges or other
vessels for damages arising out of a maritime tort, wages of a stevedore, when
employed directly by a Person listed in 46 U.S.C. § 31341, crew’s wages, salvage
and general average, whether now existing or hereafter arising and other
maritime Liens which arise by operation of law during normal operations of such
ships, barges or other vessels.

“Person” shall mean any individual, corporation, company, association,
partnership, limited liability company, joint venture, trust, unincorporated
organization or Governmental Authority or any other entity.

“Pledged Collateral” shall mean the “Pledged Collateral” as defined in the
Security Agreement.

“Pre-Opening Expenses” shall mean, with respect to any fiscal period, the amount
of expenses (including Consolidated Interest Expense) incurred with respect to
capital projects which are appropriately classified as “pre-opening expenses” on
the applicable financial statements of Borrower and its Subsidiaries for such
period.

“Prime Rate” shall mean the rate of interest per annum publicly announced from
time to time by Credit Suisse as its prime rate in effect at its Principal
Office; each change in the Prime Rate shall be effective from and including the
date such change is publicly announced as being effective. The parties hereto
acknowledge that the rate announced publicly by Administrative Agent as its
prime rate is an index or base rate and shall not necessarily be its lowest or
best rate charged to its customers or other banks.

“Principal Office” shall mean the principal office of Administrative Agent,
located on the Closing Date at Eleven Madison Avenue, 9th Floor, New York, NY
10010, or such other office as may be designated in writing by Administrative
Agent.

“Prior Mortgage Liens” shall mean, with respect to each Mortgaged Real Property,
the Liens identified in Schedule B annexed to the applicable Mortgage as such
Schedule B may be amended from time to time to the reasonable satisfaction of
Administrative Agent.

“Pro Forma Basis” shall mean, with respect to compliance with any test or
covenant or calculation of any ratio hereunder, the determination or calculation
of such test, covenant or ratio (including in connection with Specified
Transactions) in accordance with Section 1.05.

“Proceeding” shall mean any claim, counterclaim, action, judgment, suit,
hearing, governmental investigation, arbitration or proceeding, including by or
before any Governmental Authority and whether judicial or administrative.

“Property” shall mean any right, title or interest in or to property or assets
of any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible and including all contract rights, income or revenue rights, real
property interests, trademarks, trade names, equipment and proceeds of the
foregoing and, with respect to any Person, Equity Interests or other ownership
interests of any other Person.

“Public Lender” has the meaning set forth in Section 9.04.

“Purchase Money Obligation” shall mean, for any Person, the obligations of such
Person in respect of Indebtedness incurred for the purpose of financing all or
any part of the purchase price of any Property (including Equity Interests of
any Person) or the cost of installation, construction or

 

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improvement of any property or assets and any refinancing thereof; provided,
however, that such Indebtedness is incurred (except in the case of a
refinancing) within 270 days after such acquisition of such Property or the
incurrence of such costs by such Person.

“Qualified Capital Stock” shall mean, with respect to any Person, any Equity
Interests of such Person which is not Disqualified Capital Stock.

“Qualified Contingent Obligation” shall mean Contingent Obligations permitted by
Section 10.04 in respect of (a) Indebtedness of any Joint Venture in which
Borrower or any of its Restricted Subsidiaries owns (directly or indirectly) at
least 25% of the Equity Interest of such Joint Venture or (b) Indebtedness of
casinos, “racinos”, full service casino resorts, non-gaming resorts, distributed
gaming applications or taverns (and properties ancillary or related thereto (or
owners of casinos, “racinos”, full service casino resorts, non-gaming resorts,
distributed gaming applications or taverns)) with respect to which Borrower or
any of its Restricted Subsidiaries has (directly or indirectly through
Subsidiaries) entered into a management, development or similar contract and
such contract remains in full force and effect at the time such Contingent
Obligations are incurred.

“Qualified ECP Guarantor” shall mean, in respect of any Swap Obligations, each
Guarantor that has total assets exceeding $10,000,000 at the time the relevant
Guarantee or grant of the relevant security interest becomes effective with
respect to such Swap Obligation or such other person as constitutes an “eligible
contract participant” under the Commodity Exchange Act or any regulations
promulgated thereunder and can cause another person to qualify as an “eligible
contract participant” at such time by entering into a keepwell under
Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Qualifying Investments” shall mean Investments made by Borrower and its
Restricted Subsidiaries and either outstanding on the Closing Date or made after
the Closing Date in accordance with Section 10.04 hereof.

“Quarter” shall mean each three month period ending on March 31, June 30,
September 30 and December 31.

“Quarterly Dates” shall mean the last Business Day of each Quarter in each year,
commencing with the last Business Day of the first full Quarter after the
Closing Date.

“Ratio Debt” has the meaning set forth in Section 10.01(t).

“Ratio Debt Amount” shall mean, as of any date of determination:

(a) the Shared Fixed Incremental Amount; plus

(b) (x) in the case of Indebtedness incurred under Section 10.01(t) or an
Incremental Commitment that serves to effectively extend the maturity of the
Term Loans, the First Lien Term Loans and/or the First Lien Revolving Loans, an
amount equal to the reductions in the Term Loans, the First Lien Term Loans
and/or the First Lien Revolving Loans to be replaced with such Indebtedness,
(y) in the case of any Indebtedness incurred under Section 10.01(t) or an
Incremental Commitment that effectively replaces any Term Loan repaid under
Section 2.11, 13.04(b) or 13.05(k), an amount equal to the portion of the
relevant repaid Term Loans and (z) in the case of any Indebtedness incurred
under Section 10.01(t) or an Incremental Commitment that effectively replaces
any commitment under the First Lien Revolving Facility terminated, or any First
Lien Term Loan repaid, under Section 2.11, 13.04(b), 13.04(h) or 13.05(k) of the
First Lien Credit Agreement, an

 

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amount equal to the portion of the relevant terminated commitments under the
First Lien Revolving Facility or repaid First Lien Term Loans; plus

(c) the aggregate amount of any voluntary prepayment or repurchase of Term
Loans, First Lien Term Loans or First Lien Revolving Loans (to the extent
accompanied by a corresponding permanent reduction of the Revolving Commitments
(as defined in the First Lien Credit Agreement)) to the extent the relevant
prepayment or reduction (x) is not funded or effected with any long term
Indebtedness and (y) does not include any prepayment that is funded with the
proceeds of any Indebtedness incurred in reliance on clause (b) (or on clause
(b) of the Incremental Loan Amount) (the amounts under clauses (b) and (c)
together, the “Ratio Prepayment Amount”); minus the aggregate principal amount
of all Incremental Commitments incurred or issued in reliance on the Incremental
Prepayment Amount; plus

(d) an unlimited amount so long as, in the case of this clause (d), (i) if such
Indebtedness is secured on a first lien basis, the Consolidated First Lien Net
Leverage Ratio would not exceed 4.40:1.00, (ii) if such Indebtedness is secured
on a pari passu basis with the Obligations, the Consolidated Total Secured Net
Leverage Ratio would not exceed 5.60:1.00, and (iii) if such Indebtedness is
unsecured, the Consolidated Total Net Leverage Ratio shall not exceed 5.60:1.00,
in each case, calculated on a Pro Forma Basis after giving effect thereto,
including the application of proceeds thereof, as of the last day of the most
recently ended Test Period; provided that, for such purpose, (1) in the case of
any revolving Indebtedness incurred in reliance on this clause (d), such
calculation shall be made assuming a full drawing of such revolving Indebtedness
and (2) such calculation shall be made without netting the cash proceeds of any
such Indebtedness (this clause (d), the “Ratio Incurrence-Based Amount”).

It is understood and agreed that (I) Borrower may elect to use the Ratio
Incurrence-Based Amount prior to the Shared Fixed Incremental Amount or the
Ratio Prepayment Amount and regardless of whether there is capacity under the
Shared Fixed Incremental Amount or the Ratio Prepayment Amount, and if the
Shared Fixed Incremental Amount, the Ratio Prepayment Amount and the Ratio
Incurrence-Based Amount are each available and Borrower does not make an
election, Borrower will be deemed to have elected to use the Ratio
Incurrence-Based Amount; and (II) any portion of any Indebtedness incurred in
reliance on the Shared Fixed Incremental Amount or the Ratio Prepayment Amount
shall be reclassified as incurred under the Ratio Incurrence-Based Amount as
Borrower may elect from time to time if Borrower meets the applicable
Consolidated First Lien Net Leverage Ratio, Consolidated Total Secured Net
Leverage Ratio or Consolidated Total Net Leverage Ratio, as applicable, under
the Ratio Incurrence-Based Amount at such time on a pro forma basis.

“Ratio Incurrence-Based Amount” has the meaning set forth in the definition of
“Ratio Debt Amount”.

“Ratio Prepayment Amount” has the meaning set forth in the definition of “Ratio
Debt Amount”.

“Real Property” shall mean, as to any Person, all the right, title and interest
of such Person in and to land, improvements and appurtenant fixtures, including
leaseholds (it being understood that for purposes of Schedule 8.23(a), Borrower
shall not be required to describe such improvements and appurtenant fixtures in
such Schedule).

“redeem” shall mean redeem, repurchase, repay, defease (covenant or legal),
Discharge or otherwise acquire or retire for value; and “redemption” and
“redeemed” have correlative meanings.

 

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“refinance” shall mean refinance, renew, extend, exchange, replace, defease
(covenant or legal) (with proceeds of Indebtedness), Discharge (with proceeds of
Indebtedness) or refund (with proceeds of Indebtedness), in whole or in part,
including successively; and “refinancing” and “refinanced” have correlative
meanings.

“Refinancing Amendment” shall mean an amendment to this Agreement in form and
substance reasonably satisfactory to Administrative Agent and Borrower executed
by each of (a) Borrower, (b) Administrative Agent, (c) each additional Lender
and each existing Lender that agrees to provide any portion of the Credit
Agreement Refinancing Indebtedness being incurred pursuant thereto, in
accordance with Section 2.15.

“Register” has the meaning set forth in Section 2.08(c).

“Regulation D” shall mean Regulation D (12 C.F.R. Part 204) of the Board of
Governors of the Federal Reserve System of the United States (or any successor),
as the same may be amended, modified or supplemented and in effect from time to
time and all official rulings and interpretations thereunder or thereof.

“Regulation T” shall mean Regulation T (12 C.F.R. Part 220) of the Board of
Governors of the Federal Reserve System of the United States (or any successor),
as the same may be amended, modified or supplemented and in effect from time to
time and all official rulings and interpretations thereunder or thereof.

“Regulation U” shall mean Regulation U (12 C.F.R. Part 221) of the Board of
Governors of the Federal Reserve System of the United States (or any successor),
as the same may be amended, modified or supplemented and in effect from time to
time and all official rulings and interpretations thereunder or thereof.

“Regulation X” shall mean Regulation X (12 C.F.R. Part 224) of the Board of
Governors of the Federal Reserve System of the United States (or any successor),
as the same may be amended, modified or supplemented and in effect from time to
time and all official rulings and interpretations thereunder or thereof.

“Related Indemnified Person” has the meaning set forth in Section 13.03(b).

“Related Parties” shall mean, with respect to any Person, such Person’s
Affiliates and the partners, directors, officers, employees, agents, trustees,
administrators, managers, advisors and representatives of such Person and of
such Person’s Affiliates.

“Release” shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, dispersing, emanating or migrating of any Hazardous Material in,
into, onto or through the Environment or within, from or into any building,
structure, facility or fixture.

“Removal Effective Date” has the meaning set forth in Section 12.06(b).

“Replaced Lender” has the meaning set forth in Section 2.11(a).

“Replacement Lender” has the meaning set forth in Section 2.11(a).

 

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“Replacement Vessel” shall mean the replacement of any existing Mortgaged Vessel
with a vessel, ship, riverboat, barge or improvement on real property, whether
such vessel, riverboat, barge or improvement is acquired or constructed and
whether or not such vessel, ship, riverboat, barge or improvement is temporarily
or permanently moored or affixed to any real property.

“Repricing Transaction” shall mean (i) the incurrence by Borrower of a new
tranche of replacement term loans under this Agreement (including by way of
conversion of Term B Facility Loans into any such new tranche of replacement
term loans) (x) having an All-In Yield for the respective Type of such
replacement term loan that is less than the All-In Yield for Term B Facility
Loans of the respective Type (excluding any such loans incurred in connection
with a Change of Control or a Significant Acquisition and any such loan that is
not made for the primary purposes of reducing overall yield) and (y) the
proceeds of which are used to repay, in whole or in part, principal of
outstanding Term B Facility Loans (it being understood that a conversion of Term
B Facility Loans into any such new tranche of replacement term loans shall
constitute a repayment of principal of outstanding Term B Facility Loans), (ii)
any amendment, waiver or other modification to this Agreement the primary
purpose of which would have the effect of reducing the All-In Yield for Term B
Facility Loans, excluding any such amendment, waiver or modification entered
into in connection with a Change of Control or a Significant Acquisition and/or
(iii) the incurrence by Borrower or any of its Subsidiaries of (x) any
Incremental Term Loans, (y) any other term loans (which, for the avoidance of
doubt, does not include bonds) other than under this Agreement or (z) any other
bank debt other than under this Agreement (such other term loans referred to in
clause (y) above in this clause (iii) and such other bank debt referred to in
clause (z) above in this clause (iii) are individually referred to as “Other
Debt”), the proceeds of which are used in whole or in part to prepay outstanding
Term B Facility Loans (except to the extent any such Incremental Term Loans or
Other Debt is incurred in connection with a Change of Control or a Significant
Acquisition or such Incremental Term Loans or Other Debt are not incurred for
the primary purposes of reducing overall yield) if such Incremental Term Loans
or Other Debt has an All-In Yield for the respective Type of such replacement
term loan that is less than the All-In Yield for Term B Facility Loans at the
time of the prepayment thereof. Any such determination by Administrative Agent
as contemplated by preceding clauses (i)(x), (ii) and (iii) shall be conclusive
and binding on all Lenders holding or Term B Facility Loans.

“Required Lenders” shall mean, as of any date of determination: (a) prior to the
Closing Date, Lenders holding more than 50% of the aggregate amount of the
Commitments; and (b) thereafter, Non-Defaulting Lenders the sum of whose
outstanding Term Loans and unutilized Term Loan Commitments then outstanding
represents more than 50% of the aggregate sum (without duplication) of all
outstanding Term Loans of all Non-Defaulting Lenders and all unutilized Term
Loan Commitments of all Non-Defaulting Lenders.

“Required Tranche Lenders” shall mean: (a) with respect to Lenders having Term B
Facility Loans, Term B Facility Commitments or Incremental Term B Loan
Commitments, Non-Defaulting Lenders having more than 50% of the aggregate sum of
the Term B Facility Loans, unutilized Term B Facility Commitments and unutilized
Incremental Term B Loan Commitments of Non-Defaulting Lenders then outstanding;
(b) for each New Term Loan Facility, if applicable, with respect to Lenders
having New Term Loans or New Term Loan Commitments, in each case, in respect of
such New Term Loan Facility, Non-Defaulting Lenders having more than 50% of the
aggregate sum of such New Term Loans and unutilized New Term Loan Commitments of
Non-Defaulting Lenders then outstanding; (c) for each Extension Tranche, if
applicable, with respect to Lenders having Extended Term Loans or commitments in
respect of Extended Term Loans, in each case, in respect of such Extension
Tranche, Non-Defaulting Lenders having more than 50% of the aggregate sum of
such Extended Term Loans and commitments in respect thereof, as applicable, of
Non-Defaulting Lenders then outstanding; and (d) for

 

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each Tranche of Other Term Loans, Non-Defaulting Lenders having more than 50% of
the aggregate sum of such Other Term Loans and unutilized Other Term Loan
Commitments of Non-Defaulting Lenders then outstanding.

“Requirement of Law” shall mean, as to any Person, any Law or determination of
an arbitrator or any Governmental Authority, in each case applicable to or
binding upon such Person or any of its Property or to which such Person or any
of its Property is subject.

“Resignation Effective Date” has the meaning set forth in Section 12.06(a).

“Response Action” shall mean (a) “response” as such term is defined in CERCLA,
42 U.S.C. § 9601(24), and (b) all other actions required by any Governmental
Authority or voluntarily undertaken to: (i) clean up, remove, treat, abate or in
any other way address any Hazardous Material in the Environment, (ii) prevent
the Release or threatened Release, or minimize the further Release, of any
Hazardous Material or (iii) perform studies and investigations in connection
with, or as a precondition to, clause (i) or (ii) above.

“Responsible Officer” shall mean (i) the chief executive officer of Borrower,
the president of Borrower (if not the chief executive officer), any senior or
executive vice president of Borrower, the chief financial officer, the chief
accounting officer or treasurer of Borrower or, with respect to financial
matters, the chief financial officer, the chief accounting officer, senior
financial officer or treasurer of Borrower and (ii) as to any document delivered
by a Subsidiary, any Person authorized by all necessary corporate, limited
liability company and/or other action of such Subsidiary to act on behalf of
such Subsidiary.

“Restricted Amount” has the meaning set forth in Section 2.10(a).

“Restricted Payment” shall mean dividends (in cash, Property or obligations) on,
or other payments or distributions (including return of capital) on account of,
or the setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement, defeasance, termination, repurchase or other
acquisition of, any Equity Interests or Equity Rights (other than any payment
made relating to any Transfer Agreement) in Borrower or any of its Restricted
Subsidiaries, but excluding dividends, payments or distributions paid through
the issuance of additional shares of Qualified Capital Stock and any redemption,
retirement or exchange of any Qualified Capital Stock in Borrower or such
Restricted Subsidiary through, or with the proceeds of, the issuance of
Qualified Capital Stock in Borrower or any of its Restricted Subsidiaries;
provided that any Qualified Capital Stock so issued is pledged to Collateral
Agent to secure the Obligations in accordance with the Collateral Documents.

“Restricted Subsidiaries” shall mean all existing and future Subsidiaries of
Borrower other than the Unrestricted Subsidiaries.

“Reverse Trigger Event” shall mean the transfer of Equity Interests of any
Restricted Subsidiary or any Gaming Facility from trust or other similar
arrangement to Borrower or any of its Restricted Subsidiaries from time to time.

“Revocation” has the meaning set forth in Section 9.12(b).

“Rocky Gap Property” shall mean that certain property leased by Evitts Resort,
LLC, a Maryland limited liability company, pursuant to that certain Amended and
Restated Ground Lease, dated August 3, 2012 (as amended, modified or
supplemented from time to time), with the State of Maryland, to

 

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the use of the Department of Natural Resources, for real property located in
Allegany County, Maryland consisting of approximately 268 acres generally
located at 16701 Lakeview Road NE, Flintstone, Maryland 21530.

“Route Agreement” shall mean any written agreement entered into by Borrower or
any Restricted Subsidiary with another Person providing for the right to
install, maintain and operate slot machines, video poker machines or other
approved electronic gaming devices at premises owned or operated by such Person.

“S&P” shall mean Standard & Poor’s Rating Services, a division of The
McGraw-Hill Companies, or any successor thereto.

“Sanction(s)” shall mean all economic or financial sanctions or trade embargoes
imposed, administered or enforced from time to time by (a) the U.S. government,
including those administered by the Office of Foreign Assets Control of the U.S.
Department of the Treasury or the U.S. Department of State, (b) the United
Nations Security Council, the European Union, or Her Majesty’s Treasury of the
United Kingdom or (c) other relevant sanctions authority.

“Sanctioned Country” shall mean, at any time, a country, region or territory
which is itself the subject or target of any comprehensive Sanctions (at the
time of this Agreement, Crimea, Cuba, Iran, North Korea, Sudan and Syria).

“Sanctioned Person” shall mean, at any time, (a) any Person listed in any
Sanctions-related list of designated Persons maintained by the Office of Foreign
Assets Control of the U.S. Department of the Treasury, the U.S. Department of
State, the United Nations Security Council, the European Union, or Her Majesty’s
Treasury of the United Kingdom, (b) any Person located, organized or resident in
a Sanctioned Country or (c) any Person owned 50% or more or controlled by any
such Person or Persons described in the foregoing clauses (a) or (b).

“SEC” shall mean the Securities and Exchange Commission of the United States or
any successor thereto.

“Section 9.04 Financials” shall mean the financial statements delivered, or
required to be delivered, pursuant to Section 9.04(a) or (b), together with the
accompanying certificate of a Responsible Officer of Borrower delivered, or
required to be delivered, pursuant to Section 9.04(c).

“Secured Parties” shall mean the Agents and the Lenders.

“Securities Act” shall mean the Securities Act of 1933, as amended, and all
rules and regulations of the SEC promulgated thereunder.

“Security Agreement” shall mean a security agreement substantially in the form
of Exhibit H among the Credit Parties and Collateral Agent, as the same may be
amended in accordance with the terms thereof and hereof.

“Security Documents” shall mean the Security Agreement, the Custodian Agreement,
the Mortgages, the Ship Mortgages and each other security document or pledge
agreement, instrument or other document required by applicable local law or
otherwise executed and delivered by a Credit Party to grant or perfect a
security interest in any Property acquired or developed that is of the kind and
nature that would constitute Collateral on the Closing Date, and any other
document, agreement or instrument

 

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utilized to pledge or grant as collateral (or perfect any Lien thereon) for the
Obligations any Property of whatever kind or nature.

“Shared Fixed Incremental Amount” shall mean, as of any date of determination,
(a) the greater of (i) $170,000,000 and (ii) 100% of Consolidated EBITDA
calculated at the time of determination on a Pro Forma Basis as of the most
recently ended Test Period minus (b)(i) the aggregate principal amount of all
Incremental Commitments incurred or issued in reliance on the Shared Fixed
Incremental Amount, (ii) the aggregate principal amount of all Indebtedness
incurred or issued in reliance on Section 10.01(t) in reliance on the Shared
Fixed Incremental Amount, (iii) the aggregate principal amount of all
“Incremental Commitments” (as defined in the First Lien Credit Agreement)
incurred or issued in reliance on the “Shared Fixed Incremental Amount” (as
defined in the First Lien Credit Agreement) and (iv) the aggregate principal
amount of all Indebtedness incurred or issued in reliance on Section 10.01(t) of
the First Lien Credit Agreement in reliance on the “Shared Fixed Incremental
Amount” (as defined in the First Lien Credit Agreement).

“Ship Mortgage” shall mean a Ship Mortgage in form reasonably acceptable to
Administrative Agent and Borrower made by the applicable Credit Parties in favor
of Collateral Agent for the benefit of the Secured Parties, as the same may be
amended in accordance with the terms thereof and hereof, or such other
agreements reasonably acceptable to Collateral Agent as shall be necessary to
comply with applicable Requirements of Law and effective to grant in favor of
Collateral Agent for the benefit of the Secured Parties a first preferred
mortgage on the Mortgaged Vessel covered thereby, subject only to Permitted
Liens.

“Significant Acquisitions” shall mean acquisitions that, individually or in the
aggregate, (a) are not permitted by the Credit Documents immediately prior to
the consummation of such acquisitions, or (b) would result in Consolidated
EBITDA, determined on a Pro Forma Basis after giving effect to such
acquisitions, being equal to or greater than 135% of Consolidated EBITDA
immediately prior to the consummation of such acquisitions.

“Solvent” and “Solvency” shall mean, for any Person on a particular date, that
on such date (a) the fair value of the Property of such Person is greater than
the total amount of liabilities, including, without limitation, contingent
liabilities, of such Person, (b) the present fair salable value of the Property
of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (c) such Person does not intend to, and does not believe that it will,
incur debts and liabilities beyond such Person’s ability to pay as such debts
and liabilities mature, (d) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction, for
which such Person’s Property would constitute an unreasonably small capital and
(e) such Person is able to pay its debts as they become due and payable. For
purposes of this definition, the amount of contingent liabilities at any time
shall be computed as the amount that, in the light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability, without duplication.

“Specified 10.04(k) Investment Returns” shall mean the amounts received by
Borrower and its Restricted Subsidiaries with respect to Investments made
pursuant to Section 10.04(k) (including with respect to contracts related to
such Investments and including principal, dividends, interest, distributions,
sale proceeds, payments under contracts relating to such Investments, repayments
or other amounts) that are designated by Borrower as Specified 10.04(k)
Investment Returns in the Compliance Certificate delivered to Administrative
Agent in respect of the fiscal quarter (or fiscal year) in which such amounts
were received.

 

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“Specified Land” shall mean the land specified on Schedule 10.04(aa), which land
is immaterial to Borrower’s gaming operations (as reasonably determined by
Borrower).

“Specified Representations” mean the representations and warranties of the Loan
Parties set forth in Sections 8.01(a)(i) (but only with respect to Credit
Parties), 8.04(a)(i)(x), 8.05 (but only as it relates to the Credit Documents),
8.09, 8.11(b), 8.14 (but only as it relates to security interests that may be
perfected through the filing of UCC financing statements, filing of intellectual
property security agreements with the United States Patent and Trademark Office
or United States Copyright Office or delivery of stock or equivalent
certificates representing Equity Interests in material Subsidiaries that are not
Foreign Subsidiaries (other than Equity Interests in any such Subsidiaries for
which prior approval of Liens is required under applicable Gaming Laws but has
not been obtained) (and in the case of such stock or equivalent certificates,
only to the extent received from Padre Sellers after Borrower’s commercially
reasonable efforts))), 8.17 and 8.27 (as it relates to the use of proceeds of
the Loans on the Closing Date).

“Specified Transaction” shall mean (a) any incurrence or repayment of
Indebtedness (other than for working capital purposes or under a revolving
facility), (b) any Investment that results in a Person becoming a Restricted
Subsidiary or an Unrestricted Subsidiary, (c) any Permitted Acquisition or other
Acquisition, (d) any Asset Sale or designation of a Restricted Subsidiary that
results in a Restricted Subsidiary ceasing to be a Restricted Subsidiary of
Borrower or redesignation of an Unrestricted Subsidiary that results in an
Unrestricted Subsidiary becoming a Restricted Subsidiary and (e) any Acquisition
or Investment constituting an acquisition of assets constituting a business
unit, line of business or division of another Person.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentage (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which Administrative Agent is subject with respect
to the LIBO Base Rate, for eurocurrency funding (currently referred to as
“Eurocurrency Liabilities” in Regulation D). Such reserve percentage shall
include those imposed pursuant to such Regulation D. LIBOR Loans shall be deemed
to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

“Subject Subsidiary” shall mean, at any time of determination, a Subsidiary that
(i) is an Immaterial Subsidiary, (ii) its Consolidated EBITDA for the then most
recently ended Test Period is not in excess of 2.5% of the Consolidated EBITDA
of Borrower and its Restricted Subsidiaries or (iii) its Consolidated Total
Assets as of the last day of the then most recently ended Test Period is not in
excess of 2.5% of the Consolidated Total Assets of Borrower and its Restricted
Subsidiaries on a consolidated basis.

“Subsidiary” shall mean, as to any Person, (i) any corporation more than 50% of
whose stock of any class or classes having by the terms thereof ordinary voting
power to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person and/or one or more Subsidiaries
of such Person and (ii) any partnership, limited liability company, association,
joint venture or other entity in which such Person and/or one or more
Subsidiaries of such Person has more than a 50% equity interest at the time.
Unless otherwise qualified, all references to a “Subsidiary” or to
“Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of
Borrower.

 

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“Swap Contract” shall mean any agreement entered into in the ordinary course of
business (as a bona fide hedge and not for speculative purposes) (including any
master agreement and any schedule or agreement, whether or not in writing,
relating to any single transaction) that is an interest rate swap agreement,
basis swap, forward rate agreement, commodity swap, commodity option, equity or
equity index swap or option, bond option, interest rate option, foreign exchange
agreement, rate cap, collar or floor agreement, currency swap agreement,
cross-currency rate swap agreement, swap option, currency option or any other
similar agreement (including any option to enter into any of the foregoing) and
is designed to protect any Company against fluctuations in interest rates,
currency exchange rates, commodity prices, or similar risks (including any
Interest Rate Protection Agreement). For the avoidance of doubt, the term “Swap
Contract” includes, without limitation, any call options, warrants and capped
calls entered into as part of, or in connection with, an issuance of convertible
or exchangeable debt by Borrower or its Restricted Subsidiaries.

“Swap Obligation” shall mean, with respect to any Guarantor, any obligation to
pay or perform under any agreement, contract or transaction that constitutes a
“swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

“Swap Provider” shall mean any Person that is a party to a Swap Contract with
Borrower and/or any of its Restricted Subsidiaries if such Person was, at the
date of entering into such Swap Contract, a Lender or Agent or Affiliate of a
Lender or Agent, and such Person executes and delivers to Administrative Agent a
letter agreement in form and substance reasonably acceptable to Administrative
Agent pursuant to which such Person (a) appoints Collateral Agent as its agent
under the applicable Credit Documents and (b) agrees to be bound by the
provisions of Section 12.03.

“Taking” shall mean a taking or voluntary conveyance during the term of this
Agreement of all or part of any Mortgaged Real Property or Mortgaged Vessel, or
any interest therein or right accruing thereto or use thereof, as the result of,
or in settlement of, any condemnation or other eminent domain proceeding by any
Governmental Authority affecting any Mortgaged Real Property or Mortgaged Vessel
or any portion thereof, whether or not the same shall have actually been
commenced.

“Tax Returns” has the meaning set forth in Section 8.08.

“Taxes” shall mean all present or future taxes, levies, imposts, duties,
deductions, withholdings (including backup withholding), assessments, fees or
other charges imposed by any Governmental Authority, including any interest,
additions to tax or penalties applicable thereto.

“Term B Facility” shall mean the credit facility comprising the Term B Facility
Commitments, any Incremental Term B Loan Commitments and the Term B Facility
Loans.

“Term B Facility Commitment” shall mean, for each Term B Facility Lender, the
obligation of such Lender, if any, to make a Term B Facility Loan to Borrower on
the Closing Date in a principal amount not to exceed the amount set forth
opposite such Lender’s name under the heading “Term B Facility Commitment” on
Annex A, or in the Assignment Agreement pursuant to which such Lender assumed
its Term B Facility Commitment, as applicable, as the same may be (i) changed
pursuant to Section 13.05(b) or (ii) reduced or terminated from time to time
pursuant to Section 2.04 or Section 11.01. The aggregate principal amount of the
Term B Facility Commitments of all Term B Facility Lenders on the Closing Date
is $200.0 million.

“Term B Facility Lender” shall mean (a) on the Closing Date, the Lenders having
Term B Facility Commitments on Annex A hereof and (b) thereafter, the Lenders
from time to time holding any

 

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Incremental Term B Loan Commitments and/or Term B Facility Loans, as the case
may be, after giving effect to any assignments thereof permitted by
Section 13.05(b).

“Term B Facility Loans” shall mean (a) the term loans made pursuant to
Section 2.01(a) and (b) term loans made pursuant to any Incremental Term B Loan
Commitments.

“Term B Facility Maturity Date” shall mean the date that is the eighth
anniversary of the Closing Date.

“Term B Facility Notes” shall mean the promissory notes substantially in the
form of Exhibit A-2.

“Term Facilities” shall mean, collectively, the credit facilities comprising the
Term B Facility, any New Term Loan Facilities, the credit facilities comprising
the Extended Term Loans, if any, and the credit facilities comprising Other Term
Loans, if any.

“Term Loan Commitments” shall mean, collectively, (a) the Term B Facility
Commitments, (b) any Incremental Term Loan Commitments and (c) any Other Term
Loan Commitments.

“Term Loan Extension Request” shall have the meaning provided in
Section 2.13(a).

“Term Loan Notes” shall mean, collectively, the Term B Facility Notes and any
New Term Loan Notes.

“Term Loans” shall mean, collectively, the Term B Facility Loans, any Extended
Term Loans, any Other Term Loans and any New Term Loans.

“Test Period” shall mean, for any date of determination, the period of the four
most recently ended consecutive fiscal quarters of Borrower and its Restricted
Subsidiaries for which quarterly or annual financial statements have been
delivered or are required to have been delivered to Administrative Agent or have
been filed with the SEC.

“Trade Date” shall have the meaning provided in Section 13.05(k)(i).

“Tranche” shall mean (i) when used with respect to the Lenders, each of the
following classes of Lenders: (a) Lenders having Term B Facility Loans or Term B
Facility Commitments and Incremental Term B Loan Commitments and (b) Lenders
having such other Tranche of Term Loans or Term Loan Commitments created
pursuant to an Extension Amendment, Incremental Joinder Agreement or Refinancing
Amendment, and (ii) when used with respect to Loans or Commitments, each of the
following classes of Loans or Commitments: (a) Term B Facility Loans or Term B
Facility Commitments and Incremental Term B Loan Commitments and (b) such other
Tranche of Term Loans or Term Loan Commitments created pursuant to an Extension
Amendment, Incremental Joinder Agreement or Refinancing Amendment.

“Transactions” shall mean, collectively, (a) the Closing Date Refinancing,
(b) the consummation of the Padre Acquisition and the other transactions
contemplated by the Padre Acquisition Agreement, (c) the entering into of this
Agreement and the other Credit Documents and the borrowings hereunder on the
Closing Date, (D) the entering into of the Second Lien Credit Agreement and the
other Second Lien Credit Documents and the borrowings thereunder on the Closing
Date and (e) the payment of fees and expenses in connection with the foregoing.

 

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“Transfer Agreement” shall mean any trust or similar arrangement required by any
Gaming Authority from time to time with respect to the Equity Interests of any
Restricted Subsidiary (or any Person that was a Restricted Subsidiary) or any
Gaming Facility.

“Trigger Event” shall mean the transfer of shares of Equity Interests of any
Restricted Subsidiary or any Gaming Facility into trust or other similar
arrangement required by any Gaming Authority from time to time.

“Type” has the meaning set forth in Section 1.03.

“U.S. Person” shall mean a “United States person” as defined in
Section 7701(a)(30) of the Code.

“UCC” shall mean the Uniform Commercial Code as from time to time in effect in
the applicable state or other jurisdiction.

“United States” shall mean the United States of America.

“Unrestricted Cash” shall mean, as of any date of determination, the greater of
(a) (i) unrestricted cash and Cash Equivalents of Borrower and its Restricted
Subsidiaries (regardless of whether held in a Collateral Account) plus (ii) cash
and Cash Equivalents of Borrower and its Restricted Subsidiaries that are
restricted in favor of the Obligations (which may include cash and Cash
Equivalents securing other Indebtedness secured by a Lien on the Collateral)
minus (iii) $40 million and (b) zero.

“Unrestricted Subsidiaries” shall mean (a) as of the Closing Date, the
Subsidiaries listed on Schedule 8.12(c), (b) any Subsidiary of Borrower
designated as an “Unrestricted Subsidiary” pursuant to and in compliance with
Section 9.12 and (c) any Subsidiary of an Unrestricted Subsidiary (in each case,
unless such Subsidiary is no longer a Subsidiary of Borrower or is subsequently
designated as a Restricted Subsidiary pursuant to this Agreement); provided
that, each Unrestricted Subsidiary under this Agreement shall also have been
designated as an Unrestricted Subsidiary under the Second Lien Credit Agreement.

“U.S. Tax Compliance Certificate” has the meaning set forth in
Section 5.06(b)(ii).

“Venue Documents” has the meaning set forth in Section 10.05(o).

“Venue Easements” has the meaning set forth in Section 10.05(o).

“Vessel” shall mean a gaming vessel, barge or riverboat and the fixtures and
equipment located thereon.

“Voting Stock” shall mean, with respect to any Person, the Equity Interests,
participations, rights in, or other equivalents of, such Equity Interests, and
any and all rights, warrants or options exchangeable for or convertible into
such Equity Interests of such Person, in each case, that ordinarily has voting
power for the election of directors (or Persons performing similar functions) of
such Person, whether at all times or only as long as no senior class of Equity
Interests has such voting power by reason of any contingency.

“Weighted Average Life to Maturity” shall mean, on any date and with respect to
the aggregate amount of any Indebtedness (or any applicable portion thereof), an
amount equal to (a) the scheduled repayments of such Indebtedness to be made
after such date, multiplied by the number of days from such

 

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date to the date of such scheduled repayments divided by (b) the aggregate
principal amount of such Indebtedness.

“Wholly Owned Subsidiary” shall mean, with respect to any Person, any
corporation, partnership, limited liability company or other entity of which all
of the Equity Interests (other than, in the case of a corporation, directors’
qualifying shares or nominee shares required under applicable law) are directly
or indirectly owned or controlled by such Person and/or one or more Wholly Owned
Subsidiaries of such Person. Unless the context clearly requires otherwise, all
references to any Wholly Owned Subsidiary shall mean a Wholly Owned Subsidiary
of Borrower.

“Withdrawal Liability” shall mean liability by an ERISA Entity to a
Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan, as such terms are defined in Part 1 of Subtitle E of Title
IV of ERISA.

“Working Capital” shall mean, for any Person at any date, the amount (which may
be a negative number) of the Consolidated Current Assets of such Person minus
the Consolidated Current Liabilities of such Person at such date; provided that,
for purposes of calculating Working Capital, increases or decreases in Working
Capital shall be calculated without regard to any changes in Consolidated
Current Assets or Consolidated Current Liabilities as a result of (a) any
reclassification in accordance with GAAP of assets or liabilities, as
applicable, between current and noncurrent, (b) the effects of purchase
accounting or (c) the impact of non-cash items on Consolidated Current Assets
and Consolidated Current Liabilities. For purposes of calculating Working
Capital (i) for any period in which a Permitted Acquisition or other
Acquisition, or the opening of a Development Project or Expansion Capital
Expenditure, occurs (other than with respect to any Unrestricted Subsidiary) or
any Unrestricted Subsidiary is revoked and converted into a Restricted
Subsidiary, the “consolidated current assets” and “consolidated current
liabilities” of any Person, property, business or asset so acquired, of any
Person that owns or leases such Development Project or Expansion Capital
Expenditure (to the extent related to such Development Project or Expansion
Capital Expenditure), or of any Unrestricted Subsidiary so revoked, as the case
may be (determined on a basis consistent with the corresponding definitions
herein, with appropriate reference changes) shall be excluded and (ii) for any
period in which any Person, property, business or asset (other than an
Unrestricted Subsidiary) is sold, transferred or otherwise disposed of, closed
or classified as discontinued operations by Borrower or any Restricted
Subsidiary or any Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the “consolidated current assets” and “consolidated current
liabilities” of any Person, property, business or asset so sold, transferred or
otherwise disposed of, closed or classified as discontinued operations or
Restricted Subsidiary so designated, as the case may be (determined on a basis
consistent with the corresponding definitions herein, with appropriate reference
changes) shall be excluded.

“Write-Down and Conversion Powers” shall mean, with respect to any EEA
Resolution Authority, the write-down and conversion powers of such EEA
Resolution Authority from time to time under the Bail-In Legislation for the
applicable EEA Member Country, which write-down and conversion powers are
described in the EU Bail-In Legislation Schedule.

SECTION 1.02. Accounting Terms and Determinations. Except as otherwise provided
in this Agreement, all computations and determinations as to accounting or
financial matters (including financial covenants) shall be made in accordance
with GAAP as in effect on the Closing Date consistently applied for all
applicable periods, and all accounting or financial terms shall have the
meanings ascribed to such terms by GAAP. If at any time any change in GAAP would
affect the computation of any financial ratio or requirement set forth in any
Credit Document, and Borrower notifies Administrative Agent that Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change

 

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occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if Administrative Agent notifies Borrower that
the Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. If at any time any
change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Credit Document, and Borrower, Administrative Agent
or the Required Lenders shall so request, Administrative Agent, the Lenders and
Borrower shall negotiate in good faith to amend such ratio or requirement to
preserve the original intent thereof in light of such change in GAAP (subject to
the approval of the Required Lenders, not to be unreasonably withheld).

SECTION 1.03. Classes and Types of Loans. Loans hereunder are distinguished by
“Class” and by “Type.” The “Class” of a Loan (or of a Commitment to make a Loan)
refers to whether such Loan is Term B Facility Loan, a New Term Loan of any
particular Tranche, or a Term Loan of any particular Tranche of Term Loans
created pursuant to an Extension Amendment or a Refinancing Amendment, each of
which constitutes a Class. The “Type” of a Loan refers to whether such Loan is
an ABR Loan or a LIBOR Loan, each of which constitutes a Type. Loans may be
identified by both Class and Type.

SECTION 1.04. Rules of Construction.

(a) In each Credit Document, unless the context clearly requires otherwise (or
such other Credit Document clearly provides otherwise), references to (i) the
plural include the singular, the singular include the plural and the part
include the whole; (ii) Persons include their respective permitted successors
and assigns or, in the case of governmental Persons, Persons succeeding to the
relevant functions of such Persons; (iii) statutes and regulations include any
amendments, supplements or modifications of the same from time to time and any
successor statutes and regulations; (iv) unless otherwise expressly provided,
any reference to any action of any Secured Party by way of consent, approval or
waiver shall be deemed modified by the phrase “in its/their reasonable
discretion”; (v) time shall be a reference to time of day in New York, New York;
(vi) Obligations shall not be deemed “outstanding” if such Obligations have been
Paid in Full; and (vii) except as expressly provided in any Credit Document any
item required to be delivered or performed on a day that is not a Business Day
shall not be required until the next succeeding Business Day.

(b) In each Credit Document, unless the context clearly requires otherwise (or
such other Credit Document clearly provides otherwise), (i) “amend” shall mean
“amend, restate, amend and restate, supplement or modify”; and “amended,”
“amending” and “amendment” shall have meanings correlative to the foregoing;
(ii) in the computation of periods of time from a specified date to a later
specified date, “from” shall mean “from and including”; “to” and “until” shall
mean “to but excluding”; and “through” shall mean “to and including”;
(iii) “hereof,” “herein” and “hereunder” (and similar terms) in any Credit
Document refer to such Credit Document as a whole and not to any particular
provision of such Credit Document; (iv) “including” (and similar terms) shall
mean “including without limitation” (and similarly for similar terms); (v) “or”
has the inclusive meaning represented by the phrase “and/or”; (vi) references to
“the date hereof” shall mean the date first set forth above; (vii) “asset” and
“property” shall have the same meaning and effect and refer to all Property; and
(viii) a “fiscal year” or a “fiscal quarter” is a reference to a fiscal year or
fiscal quarter of Borrower.

(c) In this Agreement unless the context clearly requires otherwise, any
reference to (i) an Annex, Exhibit or Schedule is to an Annex, Exhibit or
Schedule, as the case may be, attached to this

 

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Agreement and constituting a part hereof, and (ii) a Section or other
subdivision is to a Section or such other subdivision of this Agreement.

(d) Unless otherwise expressly provided herein, (i) references to Organizational
Documents, agreements (including the Credit Documents) and other contractual
instruments shall be deemed to include all subsequent amendments, restatements,
amendments and restatements, extensions, supplements, reaffirmations and other
modifications thereto, but only to the extent that such amendments,
restatements, amendments and restatements, extensions, supplements,
reaffirmations and other modifications are permitted by the Credit Documents;
(ii) references to any Requirement of Law shall include all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Requirement of Law, and (iii) for the avoidance of doubt, any
reference herein to “the date hereof” or words of similar import shall refer to
the date that the Credit Agreement was initially entered into (October 20,
2017).

(e) This Agreement and the other Credit Documents are the result of negotiations
among and have been reviewed by counsel to Agents, Borrower and the other
parties, and are the products of all parties. Accordingly, they shall not be
construed against the Lenders or Agents merely because of Agents’ or the
Lenders’ involvement in their preparation.

SECTION 1.05. Pro Forma Calculations.

(a) Notwithstanding anything to the contrary herein, the Consolidated Total Net
Leverage Ratio, the Consolidated Total Secured Net Leverage Ratio and the
Consolidated First Lien Net Leverage Ratio shall be calculated in the manner
prescribed by this Section 1.05.

(b) For purposes of calculating the Consolidated Total Net Leverage Ratio, the
Consolidated Total Secured Net Leverage Ratio and the Consolidated First Lien
Net Leverage Ratio, Specified Transactions (and the incurrence or repayment of
any Indebtedness in connection therewith) that have been made (i) during the
applicable Test Period and (ii) subsequent to such Test Period and prior to or
simultaneously with the event for which the calculation of any such ratio is
made shall be calculated on a pro forma basis assuming that all such Specified
Transactions (and any increase or decrease in Consolidated EBITDA and the
component financial definitions used therein attributable to any Specified
Transaction) had occurred on the first day of the applicable Test Period. If,
since the beginning of any applicable Test Period, any Person that subsequently
became a Restricted Subsidiary or was merged, amalgamated or consolidated with
or into Borrower or any of its Restricted Subsidiaries since the beginning of
such Test Period shall have made any Specified Transaction that would have
required adjustment pursuant to this Section 1.05, then the Consolidated Total
Net Leverage Ratio, the Consolidated Total Secured Net Leverage Ratio and the
Consolidated First Lien Net Leverage Ratio shall be calculated to give pro forma
effect thereto in accordance with this Section 1.05.

(c) Whenever pro forma effect is to be given to the Transactions or a Specified
Transaction, the pro forma calculations shall be made in good faith by a
Responsible Officer of Borrower and include, for the avoidance of doubt, the
amount of cost savings, operating expense reductions, other operating
improvements and synergies projected by Borrower in good faith to be realized as
a result of specified actions taken or with respect to which steps have been
initiated, or are reasonably expected to be initiated, within eighteen
(18) months of the Closing Date, in the case of the Transactions, and in the
case of any other Specified Transaction, within eighteen (18) months of the
closing date of such Specified Transaction (in the good faith determination of
Borrower) (calculated on a pro forma basis as though such cost savings,
operating expense reductions, other operating improvements and synergies had
been realized during the entirety of the applicable period), net of the amount
of actual benefits realized during such

 

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period from such actions; provided that, with respect to any such cost savings,
operating expense reductions, other operating improvements and synergies, the
limitations and requirements set forth in clause (c) of the definition of
Consolidated EBITDA (other than the requirement set forth in clause (c) of
Consolidated EBITDA that steps have been initiated or taken) shall apply;
provided, further, that the aggregate amount of additions made to Consolidated
EBITDA for any Test Period pursuant to this clause (c) and clause (c) of the
definition of “Consolidated EBITDA” shall not (i) exceed 20.0% of Consolidated
EBITDA for such Test Period (after giving effect to this clause (c) and clause
(c) of the definition of “Consolidated EBITDA”) or (ii) be duplicative of one
another.

(d) In the event that Borrower or any Restricted Subsidiary incurs (including by
assumption or guarantees) or repays (including by redemption, repayment,
prepayment, retirement, exchange or extinguishment) any Indebtedness included in
the calculations of the Consolidated Total Net Leverage Ratio, the Consolidated
First Lien Net Leverage Ratio and the Consolidated Total Secured Net Leverage
Ratio, as the case may be (in each case, other than Indebtedness incurred or
repaid under any revolving credit facility without a corresponding permanent
reduction in the commitments with respect thereto), (i) during the applicable
Test Period and/or (ii) subsequent to the end of the applicable Test Period and
prior to or simultaneously with the event for which the calculation of any such
ratio is made, then the Consolidated Total Net Leverage Ratio, the Consolidated
First Lien Net Leverage Ratio and the Consolidated Total Secured Net Leverage
Ratio shall be calculated giving pro forma effect to such incurrence or
repayment of Indebtedness, to the extent required, as if the same had occurred
on the last day of the applicable Test Period. Interest on a Capital Lease shall
be deemed to accrue at an interest rate reasonably determined by a responsible
financial or accounting officer of Borrower to be the rate of interest implicit
in such Capital Lease in accordance with GAAP. Interest on Indebtedness that may
optionally be determined at an interest rate based upon a factor of a prime or
similar rate, a London interbank offered rate, or other rate, shall be
determined to have been based upon the rate actually chosen, or if none, then
based upon such optional rate chosen as Borrower may designate.

SECTION 1.06. Collateral. With respect to any Collateral, until the Discharge of
Senior Obligations (as defined in the First Lien/Second Lien Intercreditor
Agreement), any obligation of the Credit Parties hereunder or under any other
Credit Document with respect to the delivery, transfer or control of any
Collateral, the notation of any lien, security interest or pledge on any
certificate of title, bill of lading, share register or other document or
record, or the giving of any notice to any bailee or other Person shall be
deemed to be satisfied if such Credit Party complies with the requirements of
the similar provision of the applicable Senior Debt Documents (as defined in the
First Lien/Second Lien Intercreditor Agreement). Until the Discharge of Senior
Obligations (as defined in the First Lien/Second Lien Intercreditor Agreement),
the delivery or transfer of any possessory Collateral to, or the control of any
Collateral by, the Senior Representative (as defined in the First Lien/Second
Lien Intercreditor Agreement) pursuant to the Senior Debt Documents (as defined
in the First Lien/Second Lien Intercreditor Agreement) shall satisfy any
delivery, transfer or control requirement hereunder or under any other Credit
Document.

SECTION 1.07. Limited Condition Transactions. For purposes of (i) determining
compliance with any provision of this Agreement or any other Credit Document
which requires the calculation of the Consolidated Total Net Leverage Ratio, the
Consolidated Total Secured Net Leverage Ratio or the Consolidated First Lien Net
Leverage Ratio, (ii) determining compliance with representations, warranties,
Defaults or Events of Default or (iii) testing availability under baskets set
forth in this Agreement or any other Credit Document (including baskets measured
as a percentage of Consolidated EBITDA or of Consolidated Total Assets), in each
case, in connection with a Limited Condition Transaction (a “Limited Condition
Transaction” shall be defined as any Permitted Acquisition or other acquisition
not prohibited hereunder (including repayment of Indebtedness of the

 

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Person acquired, or that is secured by the assets acquired, in such Permitted
Acquisition or other acquisition), permitted Investment or unconditional
repayment or redemption of, or offer to purchase, any Indebtedness, and, in each
case, the incurrence of Indebtedness in connection therewith), at the option of
Borrower (Borrower’s election to exercise such option in connection with any
Limited Condition Transaction, an “LCT Election”), the date of determination of
whether any such action is permitted under this Agreement and the other Credit
Documents shall be deemed to be the date the definitive agreements for such
Limited Condition Transaction are entered into (or, with respect to the
incurrence of Indebtedness, the Limited Condition Transaction for which the
proceeds will be used) (the “LCT Test Date”), and if, after giving effect on a
Pro Forma Basis to the Limited Condition Transaction and the other transactions
to be entered into in connection therewith as if they had occurred at the
beginning of the most recent Test Period ending prior to the LCT Test Date,
Borrower could have taken such action on the relevant LCT Test Date in
compliance with such representation, warranty, ratio or basket, such
representation, warranty, ratio or basket shall be deemed to have been complied
with. For the avoidance of doubt, if Borrower has made an LCT Election and any
of the ratios or baskets for which compliance was determined or tested as of the
LCT Test Date are exceeded as a result of fluctuations in any such ratio or
basket (including due to fluctuations in Consolidated EBITDA or Consolidated
Total Assets of Borrower or the Person subject to such Limited Condition
Transaction) at or prior to the consummation of the relevant transaction or
action, such baskets or ratios will not be deemed to have been exceeded as a
result of such fluctuations. If Borrower has made an LCT Election for any
Limited Condition Transaction, then in connection with any subsequent
calculation of ratios or baskets on or following the relevant LCT Test Date and
prior to the earlier of (i) the date on which such Limited Condition Transaction
is consummated or (ii) the date that the definitive agreement for such Limited
Condition Transaction is terminated or expires without consummation of such
Limited Condition Transaction, any such ratio or basket shall be calculated
(a) on a Pro Forma Basis assuming such Limited Condition Transaction and other
transactions in connection therewith (including any incurrence of Indebtedness
and the use of proceeds thereof) have been consummated and (b) in the case of
any such ratio or basket related to Restricted Payments or prepayments of Other
Junior Indebtedness, without giving effect to such Limited Condition Transaction
and other transactions in connection therewith. Notwithstanding the foregoing,
the amount of (i) any Incremental Commitments that may be incurred under the
Incremental Incurrence-Based Amount and (ii) any Indebtedness that may be
incurred under the Ratio Incurrence-Based Amount, in each case, determined at
the time of signing of definitive documentation with respect to, or giving of
notice with respect to, a Limited Condition Transaction may be recalculated, at
the option of Borrower, at the time of funding.

SECTION 1.08. Ratio Calculations; Negative Covenant Reclassification.

(a) With respect to any amounts incurred or transactions entered into (or
consummated) in reliance on a provision of any Credit Document that does not
require compliance with a financial ratio or test (including the Consolidated
Total Net Leverage Ratio, the Consolidated Total Secured Net Leverage Ratio
and/or the Consolidated First Lien Net Leverage Ratio, whether or not
specifically required to be determined on a Pro Forma Basis) (any such amounts
(which will include any related “grower” component, the “Fixed Amounts”)
substantially concurrently with any amounts incurred or transactions entered
into (or consummated) in reliance on a provision of such Credit Document that
requires compliance with a financial ratio or test (including the Consolidated
Total Net Leverage Ratio, the Consolidated Total Secured Net Leverage Ratio
and/or the Consolidated First Lien Net Leverage Ratio, whether or not
specifically required to be determined on a Pro Forma Basis) which may include
any “builder” or “grower” amount (any such amounts, the “Incurrence-Based
Amounts”), it is understood and agreed that the Fixed Amounts shall be
disregarded in the calculation of the financial ratio or test applicable to such
Incurrence-Based Amounts. For the avoidance of doubt, all Indebtedness
substantially contemporaneously incurred will be included for purposes of
determining compliance with incurrence-

 

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based ratio tests outside of the debt and liens covenants. For example, if
Borrower incurs Indebtedness under clause (a), (b) or (c) of the definition of
“Incremental Loan Amount” on the same date that it incurs Indebtedness under
clause (d) of the definition of “Incremental Loan Amount”, then the Consolidated
First Lien Net Leverage Ratio and any other applicable ratio will be calculated
with respect to such incurrence under clause (d) of the definition of
“Incremental Loan Amount” without regard to any incurrence of Indebtedness under
clause (a), (b) or (d) of the definition of “Incremental Loan Amount”. If
Borrower or its Restricted Subsidiaries enters into any revolving, delayed draw
or other committed debt facility, Borrower may elect to determine compliance of
such debt facility (including the incurrence of Indebtedness and Liens from time
to time in connection therewith) with this Agreement and each other Credit
Document on the date definitive loan documents with respect thereto are executed
by all parties thereto, assuming the full amount of such facility is incurred
(and any applicable Liens are granted) on such date, in lieu of determining such
compliance on any subsequent date (including any date on which Indebtedness is
incurred pursuant to such facility).

(b) Notwithstanding anything in this Agreement or any other Credit Document to
the contrary, (i) unless specifically stated otherwise herein, any carve-out,
basket, exclusion or exception to any affirmative, negative or other covenant in
this Agreement or the other Credit Documents may be used together by any Credit
Party and its Subsidiaries without limitation for any purpose not prohibited
hereby, and (ii) any action or event permitted by this Agreement or the other
Credit Documents need not be permitted solely by reference to one provision
permitting such action or event but may be permitted in part by one such
provision and in part by one or more other provisions of this Agreement and the
other Credit Documents. For purposes of determining compliance with Article X,
in the event that any Lien, Investment, Indebtedness (whether at the time of
incurrence or upon application of all or a portion of the proceeds thereof),
Asset Sale, disposition, fundamental change, Restricted Payment, Affiliate
transaction, contractual requirement or payment or prepayment of Indebtedness
meets the criteria of one, or more than one, of the “baskets” or categories of
transactions then permitted pursuant to any clause or subsection of Article X,
such transaction (or any portion thereof) at any time shall be permitted under
one or more of such “baskets” or categories at the time of such transaction or
any later time from time to time, in each case, as determined by Borrower in its
sole discretion at such time and thereafter may be reclassified or divided (as
if incurred at such later time) by Borrower in any manner not expressly
prohibited by this Agreement, and such Lien, Investment, Indebtedness, Asset
Sale, disposition, fundamental change, Restricted Payment, Affiliate
transaction, contractual requirement or payment or prepayment of Indebtedness
(or any portion thereof) shall be treated as having been incurred or existing
pursuant to only such “basket” or category of transactions or “baskets” or
categories of transactions (or any portion thereof) without giving pro forma
effect to such item (or portion thereof) when calculating the amount of Liens,
Investments, Indebtedness, Asset Sales, dispositions, fundamental changes,
Restricted Payments, Affiliate transactions, contractual requirements or
payments or prepayments of Indebtedness, as applicable, that may be incurred
pursuant to any other “basket” or category of transactions.

ARTICLE II.

CREDITS

SECTION 2.01. Loans.

(a) Term B Facility Loans. Each Lender with a Term B Facility Commitment agrees,
severally and not jointly, on the terms and conditions of this Agreement, to
make a Term B Facility Loan to Borrower in Dollars on the Closing Date in an
aggregate principal amount equal to the Term B Facility Commitment of such
Lender. Term B Facility Loans that are repaid or prepaid may not be reborrowed.

 

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(b) Limit on LIBOR Loans. No more than eight (8) separate Interest Periods in
respect of LIBOR Loans may be outstanding at any one time in the aggregate under
all of the facilities.

(c) [Reserved].

SECTION 2.02. Borrowings. Borrower shall give Administrative Agent notice of
each borrowing hereunder as provided in Section 4.05 in the form of a Notice of
Borrowing. Unless otherwise agreed to by Administrative Agent in its sole
discretion, not later than 12:00 p.m. (Noon), New York time, on the date
specified for each borrowing in Section 4.05, each Lender shall make available
the amount of the Loan or Loans to be made by it on such date to Administrative
Agent, at an account specified by Administrative Agent maintained at the
Principal Office, in immediately available funds, for the account of Borrower.
The amounts so received by Administrative Agent shall, subject to the terms and
conditions of this Agreement, be made available to Borrower not later than 4:00
p.m., New York time, on the actual applicable Funding Date, by depositing the
same by wire transfer of immediately available funds in (or, in the case of an
account of Borrower maintained with Administrative Agent at the Principal
Office, by crediting the same to) the account or accounts of Borrower or any
other account or accounts in each case as directed by Borrower in the applicable
Notice of Borrowing.

SECTION 2.03. [Reserved].

SECTION 2.04. Termination and Reductions of Commitment.

(a)    (i) In addition to any other mandatory commitment reductions pursuant to
this Section 2.04, the aggregate amount of the Term B Facility Commitments shall
be automatically and permanently reduced to zero at 5:00 p.m., New York time, on
the Closing Date (after giving effect to the making of the Term B Facility Loans
on such date).

(ii) In addition to any other mandatory commitment reductions pursuant to this
Section 2.04, the aggregate amount of any Incremental Term Loan Commitments of
any Tranche shall be automatically and permanently reduced by the amount of
Incremental Term Loans of such Tranche made in respect thereof from time to
time.

(b) [Reserved].

(c) Any Commitment once terminated or reduced may not be reinstated.

(d) Each reduction or termination of any of the Commitments applicable to any
Tranche pursuant to this Section 2.04 shall be applied ratably among the Lenders
with such a Commitment, as the case may be, in accordance with their respective
Commitment, as applicable.

SECTION 2.05. Fees.

(a) [Reserved].

(b) Borrower shall pay to Administrative Agent for its own account the
administrative fee separately agreed to.

(c) At the time of (i) the effectiveness of a Repricing Transaction, (ii) a
voluntary prepayment of the Term B Facility Loans pursuant to Section 2.09 or
(iii) a mandatory prepayment of the Term B Facility Loans pursuant to
Section 2.10(a)(ii), in each case that occurs prior to the date that is

 

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twenty-four (24) months after the Closing Date, Borrower agrees to pay to
Administrative Agent, for the ratable account of each Lender with outstanding
Term B Facility Loans (including, in the case of clause (i), each Lender that
withholds its consent to such Repricing Transaction and is replaced or is
removed as a Lender or is repaid under Section 2.11 or 13.04(b), as the case may
be), a fee in an amount equal (i) 2.00% of the aggregate principal amount of
Term B Facility Loans that are refinanced, converted, replaced, amended,
modified or otherwise repriced in such Repricing Transaction, voluntarily
prepaid pursuant to Section 2.09 or mandatorily prepaid pursuant to
Section 2.10(a)(ii), if such Repricing Transaction, voluntary prepayment or
mandatory prepayment occurs on or prior to the first anniversary of the Closing
Date and (ii) 1.00% of the aggregate principal amount of Term B Facility Loans
that are refinanced, converted, replaced, amended, modified or otherwise
repriced in such Repricing Transaction, voluntarily prepaid pursuant to
Section 2.09 or mandatorily prepaid pursuant to Section 2.10(a)(ii), if such
Repricing Transaction, voluntary prepayment or mandatory prepayment occurs after
the first anniversary of the Closing Date and on or prior to the second
anniversary of the Closing Date. Such fee shall be due and payable upon the date
of the effectiveness of such Repricing Transaction, voluntary prepayment or
mandatory prepayment, as applicable.

(d) Borrower shall pay to Auction Manager for its own account, in connection
with any Borrower Loan Purchase, such fees as may be agreed between Borrower and
Auction Manager.

(e) Borrower shall pay to each Term B Facility Lender, on the Closing Date, an
upfront fee equal to 1.50% of such Term B Facility Lender’s Term B Facility Loan
funded on the Closing Date.

SECTION 2.06. Lending Offices. The Loans of each Type made by each Lender shall
be made and maintained at such Lender’s Applicable Lending Office for Loans of
such Type.

SECTION 2.07. Several Obligations of Lenders. The failure of any Lender to make
any Loan to be made by it on the date specified therefor shall not relieve any
other Lender of its obligation to make its Loan on such date, but neither any
Lender nor Administrative Agent shall be responsible for the failure of any
other Lender to make a Loan to be made by such other Lender, and no Lender shall
have any obligation to Administrative Agent or any other Lender for the failure
by such Lender to make any Loan required to be made by such Lender.

SECTION 2.08. Notes; Register.

(a) At the request of any Lender, its Loans of a particular Class shall be
evidenced by a promissory note, payable to such Lender (or its nominee) and
otherwise duly completed, substantially in the form of Exhibit A of such
Lender’s Term B Facility Loans; provided that any promissory notes issued in
respect of New Term Loans, Other Term Loans or Extended Term Loans shall be in
such form as mutually agreed by Borrower and Administrative Agent.

(b) The date, amount, Type, interest rate and duration of the Interest Period
(if applicable) of each Loan of each Class made by each Lender to Borrower and
each payment made on account of the principal thereof, shall be recorded by such
Lender (or its nominee) on its books and, prior to any transfer of any Note
evidencing the Loans of such Class held by it, endorsed by such Lender (or its
nominee) on the schedule attached to such Note or any continuation thereof;
provided, however, that the failure of such Lender (or its nominee) to make any
such recordation or endorsement or any error in such recordation or endorsement
shall not affect the obligations of Borrower to make a payment when due of any
amount owing hereunder or under such Note.

 

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(c) Borrower hereby designates Administrative Agent to serve as its nonfiduciary
agent, solely for purposes of this Section 2.08, to maintain a register (the
“Register”) on which it will record the name and address of each Lender, the
Commitment from time to time of each of the Lenders, the principal amount of the
Loans made by each of the Lenders (and the related interest thereon) and each
repayment in respect of the principal amount of the Loans of each Lender.
Failure to make any such recordation or any error in such recordation shall not
affect Borrower’s obligations in respect of such Loans. The entries in the
Register shall be prima facie evidence of the information noted therein (absent
manifest error), and the parties hereto shall treat each Person whose name is
recorded in the Register as the owner of a Loan or other obligation hereunder as
the owner thereof for all purposes of the Credit Documents, notwithstanding any
notice to the contrary. The Register shall be available for inspection by
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice. No assignment shall be effective unless recorded in the
Register; provided, however, that Administrative Agent agrees to record in the
Register any assignment entered into pursuant to the term hereof promptly after
the effectiveness of such assignment.

SECTION 2.09. Optional Prepayments and Conversions or Continuations of Loans.

(a) Subject to Section 4.04, Borrower shall have the right to prepay Loans
(without premium or penalty, except as provided in Section 2.09(c)), or to
convert Loans of one Type into Loans of another Type or to continue Loans of one
Type as Loans of the same Type, at any time or from time to time. Borrower shall
give Administrative Agent notice of each such prepayment, conversion or
continuation as provided in Section 4.05 (and, upon the date specified in any
such notice of prepayment, the amount to be prepaid shall become due and payable
hereunder; provided that Borrower may make any such notice conditional upon the
occurrence of a Person’s acquisition or sale or any incurrence of indebtedness
or issuance of Equity Interests). Each Notice of Continuation/Conversion shall
be substantially in the form of Exhibit C. If LIBOR Loans are prepaid or
converted other than on the last day of an Interest Period therefor, Borrower
shall at such time pay all expenses and costs required by Section 5.05.
Notwithstanding the foregoing, and without limiting the rights and remedies of
the Lenders under Article XI, in the event that any Event of Default shall have
occurred and be continuing, Administrative Agent may (and, at the request of the
Required Lenders, shall), upon written notice to Borrower, have the right to
suspend the right of Borrower to convert any Loan into a LIBOR Loan, or to
continue any Loan as a LIBOR Loan, in which event all Loans shall be converted
(on the last day(s) of the respective Interest Periods therefor) or continued,
as the case may be, as ABR Loans.

(b) Application.

(i) The amount of any optional prepayments described in Section 2.09(a) shall be
applied to prepay Loans outstanding in order of amortization, in amounts and to
Tranches, all as determined by Borrower.

(ii) In addition to the foregoing, and provided that the Consolidated Total Net
Leverage Ratio is less than or equal to 4.60 to 1.00, Borrower shall have the
right to elect to offer to prepay the Loans at a price equal to 100% of the
principal amount thereof on a pro rata basis to the Term B Facility Loans, the
New Term Loans, the Extended Term Loans and the Other Term Loans then
outstanding and apply any amounts rejected for such prepayment to repurchase,
prepay, redeem, retire, acquire, defease or cancel Indebtedness or to make
Restricted Payments notwithstanding any then applicable limitations set forth in
Section 10.06 or 10.09, respectively. If Borrower makes such an election, it
shall provide notice thereof to Administrative Agent, who shall promptly, and in
any event within one Business Day of receipt, provide such notice to the holders
of the Term Loans. Any such notice shall specify the

 

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aggregate amount offered to prepay the Term Loans. Each holder of a Term B
Facility Loan, a New Term Loan, an Other Term Loan or an Extended Term Loan may
elect, in its sole discretion, to reject such prepayment offer with respect to
an amount equal to or less than (w) with respect to holders of Term B Facility
Loans, an amount equal to the aggregate amount so offered to prepay Term B
Facility Loans times a fraction, the numerator of which is the principal amount
of Term B Facility Loans owed to such holder and the denominator of which is the
principal amount of Term B Facility Loans outstanding, (x) with respect to
holders of New Term Loans, an amount equal to the aggregate amount so offered to
prepay New Term Loans times a fraction, the numerator of which is the principal
amount of New Term Loans owed to such holder and the denominator of which is the
principal amount of New Term Loans outstanding, (y) with respect to holders of
Other Term Loans, an amount equal to the aggregate amount so offered to prepay
Other Term Loans times a fraction, the numerator of which is the principal
amount of Other Term Loans owed to such holder and the denominator of which is
the principal amount of Other Term Loans outstanding and (z) with respect to
holders of Extended Term Loans, an amount equal to the aggregate amount so
offered to prepay Extended Term Loans times a fraction, the numerator of which
is the principal amount of Extended Term Loans owed to such holder and the
denominator of which is the principal amount of Extended Term Loans outstanding.
Any rejection of such offer must be evidenced by written notice delivered to
Administrative Agent within five Business Days of receipt of the offer for
prepayment, specifying an amount of such prepayment offer rejected by such
holder, if any. Failure to give such notice will constitute an election to
accept such offer. Any portion of such prepayment offer so accepted will be used
to prepay the Term Loans held by the applicable holders within ten Business Days
of the date of receipt of the offer to prepay. Any portion of such prepayment
rejected may be used by Borrower and its Restricted Subsidiaries to repurchase,
prepay, redeem, retire, acquire, defease or cancel Indebtedness or to make
Restricted Payments notwithstanding any then applicable limitations set forth in
Section 10.06 or 10.09, respectively.

(c) Any (i) prepayment of Term B Facility Loans pursuant to this Section 2.09
and (ii) prepayment of Term B Facility Loans pursuant to Section 13.04(b) in
connection with any Repricing Transaction, in each case, made prior to the date
that is twenty-four (24) months after the Closing Date shall be subject to the
fee described in Section 2.05(c).

SECTION 2.10. Mandatory Prepayments.

(a) Borrower shall prepay the Loans as follows (each such prepayment to be
effected in each case in the manner, order and to the extent specified in
Section 2.10(b) below):

(i) Casualty Events. Within five (5) Business Days after Borrower or any
Restricted Subsidiary receives any Net Available Proceeds from any Casualty
Event or any disposition pursuant to Section 10.05(l) (or notice of collection
by Administrative Agent of the same), in an aggregate principal amount equal to
100% of such Net Available Proceeds (it being understood that applications
pursuant to this Section 2.10(a)(i) shall not be duplicative of
Section 2.10(a)(iii) below); provided, however, that:

(x) if no Event of Default then exists or would arise therefrom, the Net
Available Proceeds thereof shall not be required to be so applied on such date
to the extent that Borrower delivers an Officer’s Certificate to Administrative
Agent stating that an amount equal to such proceeds is intended to be used to
fund the acquisition of Property used or usable in the business of (A) if such
Casualty Event relates to any Credit Party, any Credit Party or (B) if such
Casualty Event relates to any other Company, any

 

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Company, or repair, replace or restore the Property or other Property used or
usable in the business of (A) if such Casualty Event relates to any Credit
Party, any Credit Party or (B) if such Casualty Event relates to any other
Company, any Company (in accordance with the provisions of the applicable
Security Document in respect of which such Casualty Event has occurred, to the
extent applicable), in each case within (A) twelve (12) months following receipt
of such Net Available Proceeds or (B) if Borrower or the relevant Restricted
Subsidiary enters into a legally binding commitment to reinvest such Net
Available Proceeds within twelve (12) months following receipt thereof, within
the later of (1) one hundred and eighty (180) days following the date of such
legally binding commitment and (2) twelve (12) months following receipt of such
Net Available Proceeds (provided that Borrower may elect to deem expenditures
that otherwise would be permissible reinvestments that occur prior to receipt of
the proceeds of a Casualty Event to have been reinvested in accordance with the
provisions hereof, so long as such deemed expenditure shall have been made no
earlier than the applicable Casualty Event), and

(y) if all or any portion of such Net Available Proceeds not required to be
applied to the prepayment of Loans pursuant to this Section 2.10(a)(i) is not so
used within the period specified by clause (x) above, such remaining portion
shall be applied on the last day of such period as specified in Section 2.10(b).

(ii) Debt Issuance. Within five (5) Business Days after any Debt Issuance
(including, for purposes of this Section 2.10(a)(ii), Credit Agreement
Refinancing Indebtedness) on or after the Closing Date, in an aggregate
principal amount equal to 100% of the Net Available Proceeds of such Debt
Issuance.

(iii) Asset Sales. Within five (5) Business Days after receipt by Borrower or
any of its Restricted Subsidiaries of any Net Available Proceeds from any Asset
Sale pursuant to Section 10.05(c), in an aggregate principal amount equal to
100% of the Net Available Proceeds from such Asset Sale or other disposition (it
being understood that applications pursuant to this Section 2.10(a)(iii) shall
not be duplicative of Section 2.10(a)(i) above); provided, however, that:

(x) an amount equal to the Net Available Proceeds from any Asset Sale pursuant
to Section 10.05(c) shall not be required to be applied as provided above on
such date if (1) no Event of Default then exists or would arise therefrom and
(2) Borrower delivers an Officer’s Certificate to Administrative Agent stating
that an amount equal to such Net Available Proceeds is intended to be
reinvested, directly or indirectly, in assets (which may be pursuant to an
acquisition of Equity Interests of a Person that directly or indirectly owns
such assets) otherwise permitted under this Agreement of (A) if such Asset Sale
was effected by any Credit Party, any Credit Party, and (B) if such Asset Sale
was effected by any other Company, any Company, in each case within (x) twelve
(12) months following receipt of such Net Available Proceeds or (y) if Borrower
or the relevant Restricted Subsidiary enters into a legally binding commitment
to reinvest such Net Available Proceeds within twelve (12) months following
receipt thereof, within the later of (A) one hundred and eighty (180) days
following the date of such legally binding commitment and (B) twelve (12) months
following receipt of such Net Available Proceeds (which certificate shall set
forth the estimates of the proceeds to be so expended) (provided that Borrower
may elect to deem expenditures that otherwise would be permissible reinvestments
that occur prior to receipt of the proceeds of an Asset Sale to have been
reinvested in accordance with the provisions hereof, so long as such deemed

 

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expenditure shall have been made no earlier than the earlier of execution of a
definitive agreement for such Asset Sale and the consummation of such Asset
Sale); and

(y) if all or any portion of such Net Available Proceeds is not reinvested in
assets in accordance with the Officer’s Certificate referred to in clause
(x) above within the period specified by clause (x) above, such remaining
portion shall be applied on the last day of such period as specified in
Section 2.10(b).

(iv) Excess Cash Flow. For each fiscal year (commencing with the fiscal year
ending December 31, 2018), not later than five (5) Business Days after the date
on which the financial statements of Borrower referred to in Section 9.04(b) for
such fiscal year are required to be delivered to Administrative Agent, Borrower
shall prepay, in accordance with subsection (b) below, the principal amount of
the Loans in an amount equal to (x) the Applicable ECF Percentage of Excess Cash
Flow for such fiscal year, minus (y) the principal amount of (i) Term Loans
voluntarily prepaid pursuant to Section 2.09, 2.11, 13.04(b), 13.05(d) (limited
to the amount of cash actually paid) and 13.05(k) during such fiscal year (or,
at Borrower’s election, after such fiscal year and prior to the date the
applicable Excess Cash Flow prepayment is due (without duplication of amounts
deducted from Excess Cash Flow in any other period)) plus (ii) First Lien Term
Loans voluntarily prepaid pursuant to Section 2.09, 2.11, 13.04(b), 13.05(d)
(limited to the amount of cash actually paid) and 13.05(k), in each case, of the
First Lien Credit Agreement, during such fiscal year (or, at Borrower’s
election, after such fiscal year and prior to the date the applicable Excess
Cash Flow prepayment is due (without duplication of amounts deducted from Excess
Cash Flow in any other period)) plus (iii) First Lien Revolving Loans
voluntarily prepaid pursuant to Section 2.09, 2.11, 13.04(b), 13.04(h), 13.05(d)
(limited to the amount of cash actually paid) and 13.05(k), in each case, of the
First Lien Credit Agreement, to the extent accompanied by an equivalent
permanent reduction of the “Total Revolving Commitments” (as defined in the
First Lien Credit Agreement) during such fiscal year (or, at Borrower’s
election, after such fiscal year and prior to the date the applicable Excess
Cash Flow prepayment is due (without duplication of amounts deducted from Excess
Cash Flow in any other period)), plus (iv) Other First Lien Indebtedness
voluntarily prepaid (and, to the extent consisting of revolving loans, so long
as accompanied by a permanent reduction of the underlying commitments) during
such fiscal year (or, at Borrower’s election, after such period and prior to the
date the applicable Excess Cash Flow prepayment is due (without duplication of
amounts deducted from Excess Cash Flow in any other period)), plus (v) Other
Second Lien Indebtedness voluntarily prepaid during such fiscal year (or, at
Borrower’s election, after such period and prior to the date the applicable
Excess Cash Flow prepayment is due (without duplication of amounts deducted from
Excess Cash Flow in any other period)), to the extent the amount of such Other
Second Lien Indebtedness so prepaid is not proportionally larger than the amount
of Term Loans so prepaid according to the respective principal amounts of Other
Second Lien Indebtedness and Term Loans as of the beginning of the applicable
fiscal year plus the principal amount of any additional Other Second Lien
Indebtedness or Term Loans incurred during the applicable fiscal year or other
applicable period, in each case, except to the extent financed with the proceeds
of Indebtedness (other than revolving Indebtedness) of Borrower or its
Restricted Subsidiaries.

(v) [reserved].

(vi) Prepayments Not Required.

 

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(A) Notwithstanding any other provisions of this Section 2.10(a), to the extent
that any of or all the Net Available Proceeds of any Asset Sale or Casualty
Event with respect to any property or assets of Foreign Subsidiaries or any
Excess Cash Flow attributable to Foreign Subsidiaries, are prohibited or delayed
by applicable local law from being repatriated to the United States, an amount
equal to the portion of such Net Available Proceeds or Excess Cash Flow so
affected will not be required to be applied to repay Term Loans at the times
provided in this Section 2.10(a) so long as applicable local law does not permit
repatriation to the United States (Borrower hereby agreeing to cause the
applicable Foreign Subsidiary to promptly take all commercially reasonable
actions required by the applicable local law to permit such repatriation), and
once such repatriation of any of such affected Net Available Proceeds or Excess
Cash Flow is permitted under the applicable local law, (x) an amount equal to
such Net Available Proceeds shall be reinvested pursuant to Section 2.10(a)(i)
or (iii), as applicable, or applied pursuant to Section 2.10(b) within five
(5) Business Days of such repatriation, and (y) an amount equal to such Excess
Cash Flow shall be applied pursuant to Section 2.10(b) within five (5) Business
Days of such repatriation. To the extent Borrower determines in good faith that
repatriation of any of or all the Net Available Proceeds of any Asset Sale or
Casualty Event with respect to any property or assets of Foreign Subsidiaries or
any Excess Cash Flow attributable to Foreign Subsidiaries would result in a
material Tax liability to Borrower or any of its Subsidiaries (including any
material withholding Tax), the applicable mandatory prepayment shall be reduced
by the Net Available Proceeds or Excess Cash Flow so affected (the “Restricted
Amount”) until such time as Borrower determines in good faith that repatriation
of the Restricted Amount may occur without incurring such material Tax
liability, at which time, (x) an amount equal to any such Net Available Proceeds
shall be reinvested pursuant to Section 2.10(a)(i) or (iii), as applicable, or
applied pursuant to Section 2.10(b) within five (5) Business Days of such
repatriation, and (y) an amount equal to any such Excess Cash Flow shall be
applied pursuant to Section 2.10(b) within five (5) Business Days of such
repatriation.

(B) Notwithstanding anything to the contrary in this Section 2.10, except with
the proceeds of Credit Agreement Refinancing Indebtedness, no mandatory
prepayment of the Term Loans shall be made pursuant to this Section 2.10 until
all amounts outstanding under the terms of the First Lien Credit Agreement and
the other First Lien Credit Documents and all Other First Lien Indebtedness have
been paid in full in immediately available funds and all commitments under all
of the First Lien Revolving Facilities have been terminated, or to the extent
prepayments of the Term Loans are otherwise permitted under the First Lien
Credit Agreement, mandatory prepayments under this Section 2.10 shall be
permitted with amounts that constitute “First Lien Declined Amounts” under and
as defined in the First Lien Credit Agreement.

(vii) Prepayments of Other Second Lien Indebtedness. Notwithstanding the
foregoing provisions of Section 2.10(a)(i), (ii), (iii), (iv) or otherwise, any
Net Available Proceeds from any such Casualty Event, Debt Issuance or Asset Sale
and any such Excess Cash Flow otherwise required to be applied to prepay the
Loans may, at Borrower’s option, be applied to prepay the principal amount of
Other Second Lien Indebtedness only to (and not in excess of) the extent to
which a mandatory prepayment in respect of such Casualty Event, Debt Issuance,
Asset Sale or Excess Cash Flow is required under the terms of such Other Second
Lien Indebtedness (with any remaining Net Available Proceeds or Excess Cash
Flow, as applicable, applied to prepay outstanding Loans in accordance with the
terms hereof), unless such

 

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application would result in the holders of Other Second Lien Indebtedness
receiving in excess of their pro rata share (determined on the basis of the
aggregate outstanding principal amount of Term Loans and Other Second Lien
Indebtedness at such time) of such Net Available Proceeds or Excess Cash Flow,
as applicable, relative to Lenders, in which case such Net Available Proceeds or
Excess Cash Flow, as applicable, may only be applied to prepay the principal
amount of Other Second Lien Indebtedness on a pro rata basis with outstanding
Term Loans. To the extent the holders of Other Second Lien Indebtedness decline
to have such indebtedness repurchased, repaid or prepaid with any such Net
Available Proceeds or Excess Cash Flow, as applicable, the declined amount of
such Net Available Proceeds or Excess Cash Flow, as applicable, shall promptly
(and, in any event, within ten (10) Business Days after the date of such
rejection) be applied to prepay Loans in accordance with the terms hereof (to
the extent such Net Available Proceeds or Excess Cash Flow, as applicable, would
otherwise have been required to be applied if such Other Second Lien
Indebtedness was not then outstanding). Any such application to Other Second
Lien Indebtedness shall reduce any prepayments otherwise required hereunder by
an equivalent amount.

(b) Application. The amount of any mandatory prepayments described in
Section 2.10(a) shall be applied to prepay Loans as follows:

(i) First, to the outstanding Term Loans in order of amortization, in amounts
and to Tranches, all as directed by Borrower; provided that mandatory
prepayments may not be directed to a later maturing Class of Term Loans without
at least pro rata repayment of any related earlier maturing Class of Term Loans;

(ii) Second, after application of prepayments in accordance with clause
(i) above, Borrower shall be permitted to retain any such remaining excess;

provided, that the Net Available Proceeds of any Credit Agreement Refinancing
Indebtedness shall be applied to the applicable Refinanced Debt.

Notwithstanding the foregoing, any Lender holding Term Loans may elect, by
written notice to Administrative Agent at least one (1) Business Day prior to
the prepayment date, to decline all or any portion of any prepayment of its Term
Loans, pursuant to this Section 2.10(a)(i), (iii) or (iv) (the “Declined
Amounts”). Any Declined Amount shall be retained by Borrower.

Notwithstanding the foregoing, if the amount of any prepayment of Loans required
under this Section 2.10 shall be in excess of the amount of the ABR Loans at the
time outstanding, only the portion of the amount of such prepayment as is equal
to the amount of such outstanding ABR Loans shall be immediately prepaid and, at
the election of Borrower, the balance of such required prepayment shall be
either (i) deposited in the Collateral Account and applied to the prepayment of
LIBOR Loans on the last day of the then next-expiring Interest Period for LIBOR
Loans (with all interest accruing thereon for the account of Borrower) or
(ii) prepaid immediately, together with any amounts owing to the Lenders under
Section 5.05. Notwithstanding any such deposit in the Collateral Account,
interest shall continue to accrue on such Loans until prepayment.

(c) [Reserved].

(d) Prepayment of Term B Facility Loans. Any prepayment of Term B Facility Loans
pursuant to Section 2.10(a)(ii) made prior to the date that is twenty-four
(24) months after the Closing Date shall be subject to the fee described in
Section 2.05(c).

 

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SECTION 2.11. Replacement of Lenders.

(a) Borrower shall have the right to replace any Lender (the “Replaced Lender”)
with one or more other Eligible Assignees (collectively, the “Replacement
Lender”), if (x) such Lender is charging Borrower increased costs pursuant to
Section 5.01 or requires Borrower to pay any Covered Taxes or additional amounts
to such Lender or any Governmental Authority for the account of such Lender
pursuant to Section 5.06 or such Lender becomes incapable of making LIBOR Loans
as provided in Section 5.03 when other Lenders are generally able to do so,
(y) such Lender is a Defaulting Lender or (z) such Lender is subject to a
Disqualification; provided, however, that (i) at the time of any such
replacement, the Replacement Lender shall enter into one or more Assignment
Agreements (and with all fees payable pursuant to Section 13.05(b) to be paid by
the Replacement Lender or Borrower) pursuant to which the Replacement Lender
shall acquire all of the Commitments and outstanding Loans of the Replaced
Lender, (ii) at the time of any such replacement, the Replaced Lender shall
receive an amount equal to the sum of (A) the principal of, and all accrued
interest on, all outstanding Loans of such Lender (other than any Loans not
being acquired by a Replacement Lender) and (B) all accrued, but theretofore
unpaid, fees owing to the Lender pursuant to Section 2.05 with respect to the
Loans being assigned, as the case may be and (iii) all obligations of Borrower
owing to such Replaced Lender (other than those specifically described in clause
(i) above in respect of Replaced Lenders for which the assignment purchase price
has been, or is concurrently being, paid, and other than those relating to Loans
or Commitments not being acquired by a Replacement Lender, but including any
amounts which would be paid to a Lender pursuant to Section 5.05 if Borrower
were prepaying a LIBOR Loan), as applicable, shall be paid in full to such
Replaced Lender, as applicable, concurrently with such replacement, as the case
may be. Upon the execution of the respective Assignment Agreement, the payment
of amounts referred to in clauses (i), (ii) and (iii) above, as applicable, and
the receipt of any consents that would be required for an assignment of the
subject Loans and Commitments to such Replacement Lender in accordance with
Section 13.05, the Replacement Lender, if any, shall become a Lender hereunder
and the Replaced Lender, as applicable, shall cease to constitute a Lender
hereunder and be released of all its obligations as a Lender, except with
respect to indemnification provisions applicable to such Lender under this
Agreement, which shall survive as to such Lender and, in the case of any
Replaced Lender, except with respect to Loans and Commitments of such Replaced
Lender not being acquired by the Replacement Lender; provided, that if the
applicable Replaced Lender does not execute the Assignment Agreement within
three (3) Business Days (or such shorter period as is acceptable to
Administrative Agent) after Borrower’s request, execution of such Assignment
Agreement by the Replaced Lender shall not be required to effect such
assignment.

(b) If Borrower receives a notice from any applicable Gaming Authority that any
Lender is subject to a Disqualification (and such Lender is notified by Borrower
and Administrative Agent in writing of such Disqualification), Borrower shall
have the right to replace such Lender with a Replacement Lender in accordance
with Section 2.11(a) or prepay the Loans held by such Lender, in each case, in
accordance with any applicable provisions of Section 2.11(a), even if a Default
or an Event of Default exists (notwithstanding anything contained in such
Section 2.11(a) to the contrary). Any such prepayment shall be deemed an
optional prepayment, as set forth in Section 2.09 and shall not be required to
be made on a pro rata basis with respect to Loans of the same Tranche as the
Loans held by such Lender (and in any event shall not be deemed to be a
Repricing Transaction). Notice to such Lender shall be given at least ten
(10) days before the required date of transfer or prepayment (unless a shorter
period is required by any Requirement of Law), as the case may be, and shall be
accompanied by evidence demonstrating that such transfer or redemption is
required pursuant to Gaming Laws. Upon receipt of a notice in accordance with
the foregoing, the Replaced Lender shall cooperate with Borrower in effectuating
the required transfer or prepayment within the time period set forth in such
notice, not to be less than the minimum notice period set forth in the foregoing
sentence (unless a shorter period is

 

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required under any Requirement of Law). Further, if the transfer or prepayment
is triggered by notice from the Gaming Authority that the Lender is subject to a
Disqualification, commencing on the date the Gaming Authority serves the notice
of Disqualification upon Borrower, to the extent prohibited by law: (i) such
Lender shall no longer receive any interest on the Loans; (ii) such Lender shall
no longer exercise, directly or through any trustee or nominee, any right
conferred by the Loans; and (iii) such Lender shall not receive any remuneration
in any form from Borrower for services or otherwise in respect of the Loans.

SECTION 2.12. Incremental Loan Commitments.

(a) Borrower Request. Borrower may, at any time, by written notice to
Administrative Agent, request (i) the establishment of additional Term B
Facility Loans with terms and conditions identical to the terms and conditions
of existing Term B Facility Loans hereunder (“Incremental Term B Loans” and the
related commitments, “Incremental Term B Loan Commitments”), and/or (ii) the
establishment of one or more new Tranches of term loans (“New Term Loans” and
the related commitments, “New Term Loan Commitments”); provided, however, that
(x) the aggregate amount of New Term Loans and Incremental Term B Loans incurred
on such date shall not exceed the Incremental Loan Amount as of such date and
(y) any such request for Incremental Commitments shall be in a minimum amount of
$25.0 million and integral multiples of $1.0 million above such amount. Borrower
may request Incremental Commitments from existing Lenders and from Eligible
Assignees; provided, however, that (A) any existing Lender approached to provide
all or a portion of the Incremental Commitments may elect or decline, in its
sole discretion, to provide all or any portion of such Incremental Commitments
offered to it and (B) any potential Lender that is not an existing Lender and
agrees to make available an Incremental Commitment shall be required to be an
Eligible Assignee and shall require approval by Administrative Agent (such
approval not to be unreasonably withheld or delayed).

(b) Incremental Effective Date. The Incremental Commitments shall be effected by
a joinder agreement to this Agreement (the “Incremental Joinder Agreement”)
executed by Borrower, Administrative Agent and each Lender making or providing
such Incremental Commitment, in form and substance reasonably satisfactory to
each of them, subject, however, to the satisfaction of the conditions precedent
set forth in this Section 2.12. The Incremental Joinder Agreement may, without
the consent of any other Lenders, effect such amendments to this Agreement and
the other Credit Documents as may be necessary or appropriate, in the opinion of
Administrative Agent, to effect the provisions of this Section 2.12.
Administrative Agent and Borrower shall determine the effective date (each, an
“Incremental Effective Date”) of any Incremental Commitments and the final
allocation of such Incremental Commitments. The effectiveness of any such
Incremental Commitments shall be subject solely to the satisfaction of the
following conditions to the reasonable satisfaction of Administrative Agent:

(i) Borrower shall deliver or cause to be delivered any legal opinions or other
documents reasonably requested by Administrative Agent in connection with any
such Incremental Commitments;

(ii) an Incremental Joinder Agreement shall have been duly executed and
delivered by Borrower, Administrative Agent and each Lender making or providing
such Incremental Commitment;

(iii) no Event of Default shall have occurred and be continuing or would exist
immediately after giving effect to such Incremental Commitments; provided that,
if the proceeds of such Incremental Commitments are being used in connection
with a Limited Condition

 

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Transaction substantially concurrently upon the receipt thereof, the Lenders
providing such Incremental Commitments may waive such condition (other than an
Event of Default specified in Section 11.01(b) or 11.01(c) or an Event of
Default specified in Section 11.01(g) or 11.01(h) with respect to Borrower);

(iv) the representations and warranties set forth herein and in the other Credit
Documents shall be true and correct in all material respects on and as of such
Incremental Effective Date as if made on and as of such date (except where such
representations and warranties expressly relate to an earlier date, in which
case such representations and warranties shall have been true and correct in all
material respects as of such earlier date); provided that, any representation
and warranty that is qualified as to “materiality,” “Material Adverse Effect” or
similar language shall be true and correct in all respects on such dates;
provided, further, that, with respect to any Incremental Commitments the
proceeds of which are used primarily to fund a Limited Condition Transaction
substantially concurrently upon the receipt thereof, the only representations
and warranties the making of which shall be a condition to the effectiveness of
such Incremental Commitments and the funding thereof shall be (except as
otherwise agreed by Borrower and the Lenders providing such Incremental
Commitments) (x) the Specified Representations and (y) if applicable, the
representations and warranties contained in the acquisition agreement relating
to such Permitted Acquisition or other Acquisition as are material to the
interests of the Lenders, but only to the extent that Borrower or any of its
Affiliates have the right to terminate its or their obligations under such
acquisition agreement as a result of a breach of such representations and
warranties in such acquisition agreement;

(v) [reserved];

(vi) [reserved];

(vii) [reserved];

(viii) other than customary “bridge” facilities (so long as the long term debt
into which any such customary “bridge” facility is to be converted satisfies the
requirements of this clause (viii)), (x) the final stated maturity of any New
Term Loans shall not be earlier than the then-existing Final Maturity Date with
respect to any then-existing Tranche of Term Loans, and (y) the Weighted Average
Life to Maturity of any New Term Loans shall be no shorter than the Weighted
Average Life to Maturity of any then-existing Tranche of Term Loans (without
giving effect to the effect of prepayments made under any existing Tranche of
Term Loans on amortization); it being understood that, subject to the foregoing,
the amortization schedule applicable to such New Term Loans shall be determined
by Borrower and the lenders of such New Term Loans and set forth in the
applicable Incremental Joinder Agreement;

(ix) the yields and interest rate margins and, except as set forth in clause
(viii) of this Section 2.12(b), amortization schedule, applicable to any New
Term Loans shall be as determined by Borrower and the holders of such
Indebtedness;

(x) except as set forth in Section 2.12(a) and in clauses (i) – (ix) of this
Section 2.12(b), the terms (excluding maturity, amortization, pricing, fees,
rate floors, premiums, optional prepayment or optional redemption provisions) of
any New Term Loans shall be (as determined by Borrower in good faith)
substantially identical to the terms of the Term B Facility Loans as existing on
the date of incurrence of such New Term Loans except, to the extent such terms
(x) at the option of Borrower (1) reflect market terms and conditions (taken as
a whole) at

 

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the time of incurrence or issuance (as determined by Borrower in good faith);
provided that, if any financial maintenance covenant is added for the benefit of
any New Term Loans, such financial maintenance covenant shall also be applicable
to the Term B Facility Loans (except to the extent such financial maintenance
covenant applies only to periods after the Final Maturity Date) or (2) are not
materially more restrictive to Borrower (as determined by Borrower in good
faith), when taken as a whole, than the terms of the Term B Facility Loans
(except for covenants or other provisions applicable only to periods after the
Final Maturity Date applicable to the Term B Facility Loans) (it being
understood that any New Term Loans may provide for the ability to participate
(i) with respect to any borrowings, voluntary prepayments or voluntary
commitment reductions, on a pro rata basis, greater than pro rata basis or less
than pro rata basis with the applicable Loans or facility and (ii) with respect
to any mandatory prepayments, on a pro rata basis or less than pro rata basis
with the applicable Loans (and on a greater than pro rata basis with respect to
prepayments of any such New Term Loans with the proceeds of permitted
refinancing Indebtedness), or (y) are (1) added to the Term B Facility Loans,
(2) applicable only after the Final Maturity Date or (3) otherwise reasonably
satisfactory to Administrative Agent (it being understood that to the extent any
financial maintenance covenant is added for the benefit of any such New Term
Loans, no consent shall be required from Administrative Agent or any of the
Lenders to the extent that such financial maintenance covenant (together with
any related “equity cure” provisions) is also added for the benefit of any
corresponding existing Facility); and

(xi) any Incremental Term B Loans (and the corresponding Incremental Term Loan
Commitments) shall have terms substantially identical to the terms of the
existing Term Loans (and the existing Term Loan Commitments) of the relevant
Tranche hereunder; provided, however, that upfront fees or original issue
discount may be paid to Lenders providing such Incremental Term B Loans as
agreed by such Lenders and Borrower, and the conditions applicable to the
incurrence of such Incremental Term B Loans (and the corresponding Incremental
Term Loan Commitments) shall be as provided in this Section 2.12; provided,
further, that the applicable Incremental Joinder Agreement shall make
appropriate adjustments to Section 3.01(c) to address such Incremental Term B
Loans, as applicable, including such adjustments as are necessary to provide for
the “fungibility” of such Incremental Term B Loans with the existing Term B
Facility Loans.

Upon the effectiveness of any Incremental Commitment pursuant to this
Section 2.12, any Person providing an Incremental Commitment that was not a
Lender hereunder immediately prior to such time shall become a Lender hereunder.
Administrative Agent shall promptly notify each Lender as to the effectiveness
of any Incremental Commitments, and (i) any Incremental Term B Loans (to the
extent funded) shall be deemed to be Term B Facility Loans hereunder and
(ii) any New Term Loans shall be deemed to be additional Term Loans hereunder.
Notwithstanding anything to the contrary contained herein, Borrower, Collateral
Agent and Administrative Agent may (and each of Collateral Agent and
Administrative Agent are authorized by each other Secured Party to) execute such
amendments and/or amendments and restatements of any Credit Documents as may be
necessary or advisable to effectuate the provisions of this Section 2.12. Such
amendments may include provisions allowing any Incremental Term B Loans or New
Term Loans to be treated on the same basis as Term B Facility Loans in
connection with declining prepayments. In connection with the incurrence of any
Incremental Term B Loans, Borrower shall be permitted to terminate any Interest
Period applicable to Term B Facility Loans on the date such Incremental Term B
Loans are incurred.

Notwithstanding anything to the contrary in this Section 2.12 or this Agreement,
if the proceeds of any Incremental Commitments are being used to finance a
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Investment permitted hereunder and the Incremental Lenders providing such
Incremental Commitments so agree, the availability thereof shall be subject to
customary “SunGard” or “certain funds” conditionality; provided, that the amount
of any Incremental Commitments under the Incremental Incurrence-Based Amount
determined at the time of signing of definitive documentation with respect to,
or giving of notice with respect to, a Limited Condition Transaction may be
recalculated, at the option of Borrower, at the time of funding.

(c) Terms of Incremental Commitments and Loans.

Except as set forth herein, the yield applicable to the Incremental Term Loans
shall be determined by Borrower and the applicable new Lenders and shall be set
forth in each applicable Incremental Joinder Agreement; provided, however, that
in the case of any Incremental Term B Loans or New Term Loans, if the All-In
Yield applicable to such Incremental Term B Loans or New Term Loans is greater
than the All-In Yield payable pursuant to the terms of this Agreement as amended
through the date of such calculation with respect to Term B Facility Loans, plus
50 basis points per annum, then the interest rate with respect to the Term B
Facility Loans shall be increased (pursuant to the applicable Incremental
Joinder Agreement) so as to cause the then applicable All-In Yield under this
Agreement on the Term B Facility Loans to equal the All-In Yield then applicable
to the Incremental Term B Loans or New Term Loans, minus 50 basis points;
provided, however, that any increase in All-In Yield due to such Incremental
Term Loans having a higher LIBO Rate floor or Alternate Base Rate floor shall,
as the election of Borrower, be reflected solely as an increase to the
applicable LIBO Rate floor or Alternate Base Rate floor, as applicable, for the
Term B Facility.

(d) [Reserved].

(e) Equal and Ratable Benefit. The Loans and Commitments established pursuant to
this Section 2.12 shall (i) constitute Loans and Commitments under, and shall be
entitled to all the benefits afforded by, this Agreement and the other Credit
Documents, (ii) without limiting the foregoing, benefit equally and ratably from
the Guarantees and security interests created by the Security Documents,
(iii) rank pari passu in right of payment and/or with respect to security with
the then-existing Tranche of Term Loans, (iv) not be secured by any assets other
than the Collateral; and (v) not be guaranteed by any person other than a
Guarantor. The Credit Parties shall take any actions reasonably required by
Administrative Agent to ensure and/or demonstrate that the Lien and security
interests granted by the Security Documents continue to secure all the
Obligations and continue to be perfected under the UCC or otherwise after giving
effect to the establishment of any Incremental Commitments or the funding of
Loans thereunder, including, without limitation, the procurement of title
insurance endorsements reasonably requested by and satisfactory to
Administrative Agent.

(f) Incremental Joinder Agreements. An Incremental Joinder Agreement may,
subject to Section 2.12(b), without the consent of any other Lenders, effect
such amendments to this Agreement and the other Credit Documents as may be
necessary or advisable, in the reasonable opinion of Administrative Agent and
Borrower, to effect the provisions of this Section 2.12 (including, without
limitation, such technical amendments as may be necessary or advisable, in the
reasonable opinion of Administrative Agent and Borrower, to give effect to the
terms and provisions of any Incremental Commitments (and any Loans made in
respect thereof)).

(g) Supersede. This Section 2.12 shall supersede any provisions in Section 13.04
to the contrary.

 

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SECTION 2.13. Extensions of Loans and Commitments.

(a) Borrower may, at any time request that all or a portion of the Term Loans of
any Tranche (an “Existing Term Loan Tranche”) be modified to constitute another
Tranche of Term Loans in order to extend the scheduled final maturity date
thereof (any such Term Loans which have been so modified, “Extended Term Loans”)
and to provide for other terms consistent with this Section 2.13. In order to
establish any Extended Term Loans, Borrower shall provide a notice to
Administrative Agent (who shall provide a copy of such notice to each of the
Lenders of the applicable Existing Term Loan Tranche) (a “Term Loan Extension
Request”) setting forth the proposed terms of the Extended Term Loans to be
established, which terms shall be identical to those applicable to the Term
Loans of the Existing Term Loan Tranche from which they are to be modified
except (i) the scheduled final maturity date shall be extended to the date set
forth in the applicable Extension Amendment and the amortization shall be as set
forth in the Extension Amendment, (ii) (A) the Applicable Margins with respect
to the Extended Term Loans may be higher or lower than the Applicable Margins
for the Term Loans of such Existing Term Loan Tranche and/or (B) additional or
reduced fees (including prepayment or termination premiums) may be payable to
the Lenders providing such Extended Term Loans in addition to or in lieu of any
increased or decreased Applicable Margins contemplated by the preceding clause
(A), in each case, to the extent provided in the applicable Extension Amendment,
(iii) any Extended Term Loans may participate on a pro rata basis or a less than
pro rata basis (but not greater than a pro rata basis) in any optional or
mandatory prepayments or prepayment of Term Loans hereunder in each case as
specified in the respective Term Loan Extension Request and (iv) the final
maturity date and the scheduled amortization applicable to the Extended Term
Loans shall be set forth in the applicable Extension Amendment and the scheduled
amortization of such Existing Term Loan Tranche shall be adjusted to reflect the
amortization schedule (including the principal amounts payable pursuant thereto)
in respect of the Term Loans under such Existing Term Loan Tranche that have
been extended as Extended Term Loans as set forth in the applicable Extension
Amendment; provided, however, that the Weighted Average Life to Maturity of such
Extended Term Loans shall be no shorter than the Weighted Average Life to
Maturity of the Term Loans of such Existing Term Loan Tranche (determined
without giving effect to the impact of prepayments on amortization of such
Existing Term Loans Tranche) (it being understood that each Lender providing
Extended Term Loans, by executing an Extension Amendment, agrees to be bound by
such provisions and waives any inconsistent provisions set forth in
Section 4.02, 4.07(b) or 13.04). Except as provided above, each Lender holding
Extended Term Loans shall be entitled to all the benefits afforded by this
Agreement (including, without limitation, the provisions set forth in
Section 2.09(b) and 2.10(b) applicable to Term Loans) and the other Credit
Documents, and shall, without limiting the foregoing, benefit equally and
ratably from the Guarantees and security interests created by the Security
Documents. The Credit Parties shall take any actions reasonably required by
Administrative Agent to ensure and/or demonstrate that the Lien and security
interests granted by the Security Documents continue to secure all the
Obligations and continue to be perfected under the UCC or otherwise after giving
effect to the extension of any Term Loans, including, without limitation, the
procurement of title insurance endorsements reasonably requested by and
satisfactory to Administrative Agent. No Lender shall have any obligation to
agree to have any of its Term Loans of any Existing Term Loan Tranche modified
to constitute Extended Term Loans pursuant to any Term Loan Extension Request.
Any Extended Term Loans of any Extension Tranche shall constitute a separate
Tranche and Class of Term Loans from the Existing Term Loan Tranche from which
they were modified.

(b) [Reserved].

(c) Borrower shall provide the applicable Extension Request at least five
(5) Business Days prior to the date on which Lenders under the Existing Tranche
are requested to respond (or such shorter period as is agreed to by
Administrative Agent in its sole discretion). Any Lender (an “Extending

 

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Lender”) wishing to have all or a portion of its Term Loans of the Existing
Tranche subject to such Extension Request modified to constitute Extended Term
Loans shall notify Administrative Agent (an “Extension Election”) on or prior to
the date specified in such Extension Request of the amount of its Term Loans of
the Existing Tranche that it has elected to modify to constitute Extended Term
Loans. In the event that the aggregate amount of Term Loans of the Existing
Tranche subject to Extension Elections exceeds the amount of Extended Term Loans
requested pursuant to the Extension Request, Term Loans subject to such
Extension Elections shall be modified to constitute Extended Term Loans on a pro
rata basis based on the amount of Term Loans included in such Extension
Elections. Borrower shall have the right to withdraw any Extension Request upon
written notice to Administrative Agent in the event that the aggregate amount of
Term Loans of the Existing Tranche subject to such Extension Request is less
than the amount of Extended Term Loans requested pursuant to such Election
Request.

(d) Extended Term Loans shall be established pursuant to an amendment (an
“Extension Amendment”) to this Agreement (which shall be substantially in the
form of Exhibit Q to this Agreement or such other form as is reasonably
acceptable to Administrative Agent). Each Extension Amendment shall be executed
by Borrower, Administrative Agent and the Extending Lenders (it being understood
that such Extension Amendment shall not require the consent of any Lender other
than the Extending Lenders with respect to the Extended Term Loans established
thereby). An Extension Amendment may, subject to Sections 2.13(a) and (b),
without the consent of any other Lenders, effect such amendments to this
Agreement and the other Credit Documents as may be necessary or advisable, in
the reasonable opinion of Administrative Agent and Borrower, to effect the
provisions of this Section 2.13 (including, without limitation, such technical
amendments as may be necessary or advisable, in the reasonable opinion of
Administrative Agent and Borrower, to give effect to the terms and provisions of
any Extended Term Loans).

SECTION 2.14. Defaulting Lender Provisions.

(a) Notwithstanding anything to the contrary in this Agreement, if a Lender
becomes, and during the period it remains, a Defaulting Lender, the following
provisions shall apply:

(i) any payment of principal, interest, fees or other amounts received by
Administrative Agent for the account of such Defaulting Lender (whether
voluntary or mandatory, at maturity, pursuant to Article 11 or otherwise) or
received by Administrative Agent from a Defaulting Lender pursuant to
Section 4.07 shall be applied at such time or times as may be determined by
Administrative Agent as follows: first, to the payment of any amounts owing by
such Defaulting Lender to Administrative Agent hereunder; second, as Borrower
may request (so long as no Default or Event of Default exists), to the funding
of any Loan in respect of which such Defaulting Lender has failed to fund its
portion thereof as required by this Agreement, as determined by Administrative
Agent; third, if so determined by Administrative Agent and Borrower, to be held
in a non-interest bearing deposit account and released pro rata in order to
satisfy such Defaulting Lender’s potential future funding obligations with
respect to Loans under this Agreement; fourth, to the payment of any amounts
owing to the Lenders as a result of any judgment of a court of competent
jurisdiction obtained by any Lender against such Defaulting Lender as a result
of such Defaulting Lender’s breach of its obligations under this Agreement;
fifth, so long as no Default or Event of Default exists, to the payment of any
amounts owing to Borrower as a result of any judgment of a court of competent
jurisdiction obtained by Borrower against such Defaulting Lender as a result of
such Defaulting Lender’s breach of its obligations under this Agreement; and
sixth, to such Defaulting Lender or as otherwise directed by a court of
competent jurisdiction; provided that if (x) such payment is a payment of the
principal amount of any Loans in respect of which such Defaulting Lender has not
fully funded its appropriate share,

 

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and (y) such Loans were made at a time when the conditions set forth in
Section 7.02 were satisfied or waived, such payment shall be applied solely to
pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being
applied to the payment of any Loans of such Defaulting Lender. Any payments,
prepayments or other amounts paid or payable to a Defaulting Lender that are
applied (or held) to pay amounts owed by a Defaulting Lender pursuant to this
Section 2.14(a)(i) shall be deemed paid to and redirected by such Defaulting
Lender, and each Lender irrevocably consents hereto.

(b) Cure. If Borrower and Administrative Agent agree in writing in their
discretion that a Lender is no longer a Defaulting Lender, Administrative Agent
will so notify the parties hereto, whereupon as of the effective date specified
in such notice and subject to any conditions set forth therein (which may
include arrangements with respect to any amounts then held in the segregated
account referred to in Section 2.14(a)), such Lender will cease to be a
Defaulting Lender and will be a Non-Defaulting Lender.

SECTION 2.15. Refinancing Amendments.

(a) At any time after the Closing Date, Borrower may obtain Credit Agreement
Refinancing Indebtedness in respect of all or any portion of the Term Loans then
outstanding under this Agreement (which for purposes of this clause (a) will be
deemed to include any then outstanding Other Term Loans, Incremental Term Loans
or Extended Term Loans), in the form of Other Term Loans or Other Term Loan
Commitments pursuant to a Refinancing Amendment. Each issuance of Credit
Agreement Refinancing Indebtedness under this Section 2.15(a) shall be in an
aggregate principal amount that is (x) not less than $5.0 million and (y) an
integral multiple of $1.0 million in excess thereof.

(b) The effectiveness of any such Credit Agreement Refinancing Indebtedness
shall be subject solely to the satisfaction of the following conditions to the
reasonable satisfaction of Administrative Agent: (i) other than customary
“bridge” facilities (so long as the long term debt into which any such customary
“bridge” facility is to be converted satisfies the requirements of this clause
(b)), any Credit Agreement Refinancing Indebtedness in respect of Term Loans
will have a maturity date that is not prior to the maturity date of, and a
Weighted Average Life to Maturity that is not shorter than the Weighted Average
Life to Maturity of, the Term Loans being refinanced (determined without giving
effect to the impact of prepayments on amortization of Term Loans being
refinanced); (ii) the aggregate principal amount of any Credit Agreement
Refinancing Indebtedness shall not exceed the principal amount so refinanced,
plus, accrued interest, plus, any premium or other payment required to be paid
in connection with such refinancing, plus, the amount of reasonable and
customary fees and expenses of Borrower or any of its Restricted Subsidiaries
incurred in connection with such refinancing, plus, any unutilized commitments
thereunder; (iii) to the extent reasonably requested by Administrative Agent,
receipt by Administrative Agent and the Lenders of customary legal opinions and
other documents; (iv) to the extent reasonably requested by Administrative
Agent, execution of amendments to the Mortgages by the applicable Credit Parties
and Collateral Agent, in form and substance reasonably satisfactory to
Administrative Agent and Collateral Agent; (v) to the extent reasonably
requested by Administrative Agent, delivery to Administrative Agent of title
insurance endorsements reasonably satisfactory to Administrative Agent; and
(vi) execution of a Refinancing Amendment by the Credit Parties, Administrative
Agent and Lenders providing such Credit Agreement Refinancing Indebtedness.

(c) The Loans and Commitments established pursuant to this Section 2.15 shall
constitute Loans and Commitments under, and shall be entitled to all the
benefits afforded by, this Agreement and the other Credit Documents, and shall,
without limiting the foregoing, benefit equally and ratably from the Guarantees
and security interests created by the Security Documents. The Credit Parties
shall take

 

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any actions reasonably required by Administrative Agent to ensure and/or
demonstrate that the Lien and security interests granted by the Security
Documents continue to secure all the Obligations and continue to be perfected
under the UCC or otherwise after giving effect to the applicable Refinancing
Amendment.

(d) Upon the effectiveness of any Refinancing Amendment pursuant to this
Section 2.15, any Person providing the corresponding Credit Agreement
Refinancing Indebtedness that was not a Lender hereunder immediately prior to
such time shall become a Lender hereunder. Administrative Agent shall promptly
notify each Lender as to the effectiveness of such Refinancing Amendment, and
(i) any Other Term Loans resulting from such Refinancing Amendment shall be
deemed to be Term Loans hereunder (to the extent funded) and (ii) any Other Term
Loan Commitments resulting from such Refinancing Amendment shall be deemed to be
Term Loan Commitments hereunder. Notwithstanding anything to the contrary
contained herein, Borrower, Collateral Agent and Administrative Agent may (and
each of Collateral Agent and Administrative Agent are authorized by each other
Secured Party to) execute such amendments and/or amendments and restatements of
any Credit Documents as may be necessary or advisable to effectuate the
provisions of this Section 2.15. Such amendments may include provisions allowing
any Other Term Loans to be treated on the same basis as Term B Facility Loans in
connection with declining prepayments.

(e) Each of the parties hereto hereby agrees that, upon the effectiveness of any
Refinancing Amendment, this Agreement shall be deemed amended to the extent (but
only to the extent) necessary to reflect the existence and terms of the Credit
Agreement Refinancing Indebtedness incurred pursuant thereto (including any
amendments necessary to treat the Loans and Commitments subject thereto as Other
Term Loans and/or Other Term Loan Commitments). Any Refinancing Amendment may,
without the consent of any other Lenders, effect such amendments to this
Agreement and the other Credit Documents as may be necessary or appropriate, in
the reasonable opinion of Administrative Agent and Borrower, to effect the
provisions of this Section 2.15. This Section 2.15 shall supersede any
provisions in Section 4.02, 4.07(b) or 13.04 to the contrary.

ARTICLE III.

PAYMENTS OF PRINCIPAL AND INTEREST

SECTION 3.01. Repayment of Loans.

(a) [Reserved].

(b) Term B Facility Loans. Borrower hereby promises to pay to Administrative
Agent for the account of the Lenders with Term B Facility Loans in repayment of
the principal of such Term B Facility Loans, the remaining principal amount of
Term B Facility Loans on the Term B Facility Maturity Date.

(c) New Term Loans; Extended Term Loans; Other Term Loans. New Term Loans shall
mature in installments as specified in the related Incremental Joinder Agreement
pursuant to which such New Term Loans were made, subject, however, to
Section 2.12(b). Extended Term Loans shall mature in installments as specified
in the applicable Extension Amendment pursuant to which such Extended Term Loans
were established, subject, however, to Section 2.13(a). Other Term Loans shall
mature in installments as specified in the applicable Refinancing Amendment
pursuant to which such Other Term Loans were established, subject, however, to
Section 2.15(a).

 

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SECTION 3.02. Interest.

(a) Borrower hereby promises to pay to Administrative Agent for the account of
each Lender interest on the unpaid principal amount of each Loan made or
maintained by such Lender to Borrower for the period from and including the date
of such Loan to but excluding the date such Loan shall be paid in full at the
following rates per annum:

(i) during such periods as such Loan is an ABR Loan, the Alternate Base Rate (as
in effect from time to time), plus the Applicable Margin applicable to such
Loan, and

(ii) during such periods as such Loan is a LIBOR Loan, for each Interest Period
relating thereto, the LIBO Rate for such Loan for such Interest Period, plus the
Applicable Margin applicable to such Loan.

(b) To the extent permitted by Law:

(i) upon the occurrence and during the continuance of an Event of Default under
Section 11.01(b), 11.01(c), 11.01(g) or Section 11.01(h), all Obligations shall
automatically and without any action by any Person, bear interest at the Default
Rate; and

(ii) upon the occurrence and during the continuance of any other Event of
Default, at the written direction of the Required Lenders, all Obligations shall
bear interest at the Default Rate.

Interest which accrues under this paragraph shall be payable on demand.

(c) Accrued interest on each Loan shall be payable (i) in the case of each ABR
Loan, (x) quarterly in arrears on each Quarterly Date, (y) on the date of any
repayment or prepayment in full of all outstanding ABR Loans of any Tranche of
Loans (but only on the principal amount so repaid or prepaid), and (z) at
maturity (whether by acceleration or otherwise) and, after such maturity, on
demand, and (ii) in the case of each LIBOR Loan, (x) on the last day of each
Interest Period applicable thereto and, if such Interest Period is longer than
three months, on each date occurring at three-month intervals after the first
day of such Interest Period, (y) on the date of any repayment or prepayment
thereof or the conversion of such Loan to a Loan of another Type (but only on
the principal amount so paid, prepaid or converted) and (z) at maturity (whether
by acceleration or otherwise) and, after such maturity, on demand. Promptly
after the determination of any interest rate provided for herein or any change
therein, Administrative Agent shall give notice thereof to the Lenders to which
such interest is payable and to Borrower.

ARTICLE IV.

PAYMENTS; PRO RATA TREATMENT; COMPUTATIONS; ETC.

SECTION 4.01. Payments.

(a) All payments of principal, interest and other amounts to be made by Borrower
under this Agreement and the Notes, and, except to the extent otherwise provided
therein, all payments to be made by the Credit Parties under any other Credit
Document, shall be made in Dollars, in immediately available funds, without
deduction, set-off or counterclaim, to Administrative Agent at its account at
the Principal Office, not later than 2:00 p.m., New York time, on the date on
which such payment shall become due (each such payment made after such time on
such due date may, at the discretion of Administrative

 

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Agent, be deemed to have been made on the next succeeding Business Day).
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof.

(b) Borrower shall, at the time of making each payment under this Agreement or
any Note for the account of any Lender, specify (in accordance with Sections
2.09 and 2.10, if applicable) to Administrative Agent (which shall so notify the
intended recipient(s) thereof) the Class and Type of Loans or other amounts
payable by Borrower hereunder to which such payment is to be applied.

(c) Each payment received by Administrative Agent under this Agreement or any
Note for the account of any Lender shall be paid by Administrative Agent to such
Lender, in immediately available funds, (x) if the payment was actually received
by Administrative Agent prior to 12:00 p.m. (Noon), New York time on any day, on
such day and (y) if the payment was actually received by Administrative Agent
after 12:00 p.m. (Noon), New York time, on any day, by 1:00 p.m., New York time,
on the following Business Day (it being understood that to the extent that any
such payment is not made in full by Administrative Agent, Administrative Agent
shall pay to such Lender, upon demand, interest at the Federal Funds Effective
Rate from the date such amount was required to be paid to such Lender pursuant
to the foregoing clauses until the date Administrative Agent pays such Lender
the full amount).

(d) If the due date of any payment under this Agreement or any Note would
otherwise fall on a day that is not a Business Day, such date shall be extended
to the next succeeding Business Day, and interest shall be payable for any
principal so extended for the period of such extension at the rate then borne by
such principal.

SECTION 4.02. Pro Rata Treatment. Except to the extent otherwise provided
herein: (a) each borrowing of Loans of a particular Class from the Lenders under
Section 2.01 shall be made from the relevant Lenders, and each termination or
reduction of the amount of the Commitments of a particular Class under
Section 2.04 shall be applied to the respective Commitments of such Class of the
relevant Lenders pro rata according to the amounts of their respective
Commitments of such Class; (b) except as otherwise provided in Section 5.04,
LIBOR Loans of any Class having the same Interest Period shall be allocated pro
rata among the relevant Lenders according to the amounts of their respective
Term Loan Commitments (in the case of the making of Loans) or their respective
Term Loans (in the case of conversions and continuations of Loans); (c) except
as otherwise provided in Section 2.09(b), Section 2.10(b), Section 2.12,
Section 2.13, Section 2.14, Section 2.15, Section 13.04 or Section 13.05(d),
each payment or prepayment of principal of any particular Class of Term Loans
shall be made for the account of the relevant Lenders pro rata in accordance
with the respective unpaid outstanding principal amounts of the Loans of such
Class held by them; and (d) except as otherwise provided in Section 2.09(b),
Section 2.10(b), Section 2.12, Section 2.13, Section 2.14, Section 2.15,
Section 13.04 or Section 13.05(d), each payment of interest on Term Loans shall
be made for the account of the relevant Lenders pro rata in accordance with the
amounts of interest on such Loans then due and payable to the respective
Lenders.

SECTION 4.03. Computations. Interest on LIBOR Loans shall be computed on the
basis of a year of 360 days and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which such amounts are
payable and interest on ABR Loans shall be computed on the basis of a year of
365 or 366 days, as the case may be, and actual days elapsed (including the
first day but excluding the last day) occurring in the period for which such
amounts are payable.

SECTION 4.04. Minimum Amounts. Except for mandatory prepayments made pursuant to
Section 2.10 and conversions or prepayments made pursuant to Section 5.04, each
Borrowing, conversion and partial prepayment of principal of Loans shall be in
an amount at least equal to in the case of Term

 

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Loans, $5.0 million with respect to ABR Loans and $5.0 million with respect to
LIBOR Loans and in multiples of $100,000 in excess thereof or, if less, the
remaining Term Loans (borrowings, conversions or prepayments of or into Loans of
different Types or, in the case of LIBOR Loans, having different Interest
Periods at the same time hereunder to be deemed separate borrowings, conversions
and prepayments for purposes of the foregoing, one for each Type or Interest
Period). Anything in this Agreement to the contrary notwithstanding, the
aggregate principal amount of LIBOR Loans having the same Interest Period shall
be in an amount at least equal to $1.0 million and in multiples of $100,000 in
excess thereof and, if any LIBOR Loans or portions thereof would otherwise be in
a lesser principal amount for any period, such Loans or portions, as the case
may be, shall be ABR Loans during such period.

SECTION 4.05. Certain Notices. Notices by Borrower to Administrative Agent of
terminations or reductions of the Commitments, of Borrowings, conversions,
continuations and optional prepayments of Loans and of Classes of Loans, of
Types of Loans and of the duration of Interest Periods shall be irrevocable and
shall be effective only if received by Administrative Agent by telephone not
later than 1:00 p.m., New York time (promptly followed by written notice via
facsimile or electronic mail), on at least the number of Business Days prior to
the date of the relevant termination, reduction, Borrowing, conversion,
continuation or prepayment or the first day of such Interest Period specified in
the table below (unless otherwise agreed to by Administrative Agent in its sole
discretion), provided that Borrower may make any such notice conditional upon
the occurrence of a Person’s acquisition or sale or any incurrence of
indebtedness or issuance of Equity Interests.

NOTICE PERIODS

 

Notice

   Number of
Business Days Prior  

Termination or reduction of Commitments

     3  

Borrowing of, or conversions into, ABR Loans

     same day  

Optional prepayment of ABR Loans

     1  

Borrowing or optional prepayment of, conversions into, continuations as, or
duration of Interest Periods for, LIBOR Loans

     3  

Each such notice of termination or reduction shall specify the amount and the
Class of the Commitments to be terminated or reduced. Each such notice of
Borrowing, conversion, continuation or prepayment shall specify the Class of
Loans to be borrowed, converted, continued or prepaid and the amount (subject to
Section 4.04) and Type of each Loan to be borrowed, converted, continued or
prepaid and the date of borrowing, conversion, continuation or prepayment (which
shall be a Business Day). Each such notice of the duration of an Interest Period
shall specify the Loans to which such Interest Period is to relate.
Administrative Agent shall promptly notify the Lenders of the contents of each
such notice. In the event that Borrower fails to select the Type of Loan within
the time period and otherwise as provided in this Section 4.05, such Loan (if
outstanding as a LIBOR Loan) will be automatically converted into an ABR Loan on
the last day of the then current Interest Period for such Loan or (if
outstanding as an ABR Loan) will remain as, or (if not then outstanding) will be
made as, an ABR Loan. In the event that Borrower has elected to borrow or
convert Loans into LIBOR Loans but fails to select the duration of any Interest
Period for any LIBOR Loans within the time period and otherwise as provided in
this Section 4.05, such LIBOR Loan shall have an Interest Period of one month.

 

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SECTION 4.06. Non-Receipt of Funds by Administrative Agent.

(a) Unless Administrative Agent shall have received notice from a Lender prior
to the proposed date of any Borrowing of LIBOR Loans (or, in the case of any
Borrowing of ABR Loans, prior to 12:00 noon on the date of such Borrowing) that
such Lender will not make available to Administrative Agent such Lender’s share
of such Borrowing, Administrative Agent may assume that such Lender has made
such share available on such date in accordance with Section 2.02 (or, in the
case of a Borrowing of ABR Loans, that such Lender has made such share available
in accordance with and at the time required by Section 2.02) and may, in
reliance upon such assumption, make available to Borrower a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to Administrative Agent, then the applicable
Lender and Borrower severally agree to pay to Administrative Agent forthwith on
demand such corresponding amount in immediately available funds with interest
thereon, for each day from and including the date such amount is made available
to Borrower to but excluding the date of payment to Administrative Agent, at
(A) in the case of a payment to be made by such Lender, the Federal Funds
Effective Rate, plus any administrative, processing or similar fees customarily
charged by Administrative Agent in connection with the foregoing, and (B) in the
case of a payment to be made by Borrower, the interest rate applicable to ABR
Loans. If Borrower and such Lender shall pay such interest to Administrative
Agent for the same or an overlapping period, Administrative Agent shall promptly
remit to Borrower the amount of such interest paid by Borrower for such period.
If such Lender pays its share of the applicable Borrowing to Administrative
Agent, then the amount so paid shall constitute such Lender’s Loan included in
such Borrowing. Any payment by Borrower shall be without prejudice to any claim
Borrower may have against a Lender that shall have failed to make such payment
to Administrative Agent.

(b) Unless Administrative Agent shall have received notice from Borrower prior
to the date on which any payment is due to Administrative Agent for the account
of the Lenders hereunder that Borrower will not make such payment,
Administrative Agent may assume that Borrower has made such payment on such date
in accordance herewith and may, in reliance upon such assumption, distribute to
the Lenders the amount due. In such event, if Borrower has not in fact made such
payment, then each of the Lenders severally agrees to repay to Administrative
Agent forthwith on demand the amount so distributed to such Lender, in
immediately available funds with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to Administrative Agent, at the Federal Funds Effective Rate. A notice
of Administrative Agent to any Lender or Borrower with respect to any amount
owing under this subsection (b) shall be conclusive, absent manifest error.

SECTION 4.07. Right of Setoff, Sharing of Payments; Etc.

(a) If any Event of Default shall have occurred and be continuing, each Credit
Party agrees that, in addition to (and without limitation of) any right of
setoff, banker’s lien or counterclaim a Lender may otherwise have, each Lender
shall be entitled, at its option (to the fullest extent permitted by law),
subject to obtaining the prior written consent of Administrative Agent, to set
off and apply any deposit (general or special, time or demand, provisional or
final), or other indebtedness, held by it for the credit or account of such
Credit Party at any of its offices, in Dollars or in any other currency, against
any principal of or interest on any of such Lender’s Loans or any other amount
payable to such Lender hereunder that is not paid when due (regardless of
whether such deposit or other indebtedness is then due to such Credit Party), in
which case it shall promptly notify such Credit Party thereof; provided,
however, that such Lender’s failure to give such notice shall not affect the
validity thereof; and provided further that no such right of setoff, banker’s
lien or counterclaim shall apply to any funds held for further distribution to
any Governmental Authority.

 

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(b) Each of the Lenders agrees that, if it should receive (other than pursuant
to Section 2.09(b), Section 2.10(b), Section 2.11, Section 2.12, Section 2.13,
Section 2.15, Article V, Section 13.04 or Section 13.05(d) or as otherwise
specifically provided herein or in the Commitment Letter) any amount hereunder
(whether by voluntary payment, by realization upon security, by the exercise of
the right of setoff or banker’s lien, by counterclaim or cross action, by the
enforcement of any right under the Credit Documents (including any guarantee),
or otherwise) which is applicable to the payment of the principal of, or
interest on, the Loans or fees, the sum of which with respect to the related sum
or sums received by other Lenders is in a greater proportion than the total of
such amounts then owed and due to such Lender bears to the total of such amounts
then owed and due to all of the Lenders immediately prior to such receipt, then
such Lender receiving such excess payment shall purchase for cash without
recourse or warranty from the other Lenders an interest in the Obligations to
such Lenders in such amount as shall result in a proportional participation by
all of the Lenders in such amount; provided, however, that if all or any portion
of such excess amount is thereafter recovered from such Lender, such purchase
shall be rescinded and the purchase price restored to the extent of such
recovery, but without interest. Borrower consents to the foregoing arrangements.

(c) Borrower agrees that any Lender so purchasing such a participation may
exercise all rights of setoff, banker’s lien, counterclaim or similar rights
with respect to such participation as fully as if such Lender were a direct
holder of Loans or other amounts (as the case may be) owing to such Lender in
the amount of such participation.

(d) Nothing contained herein shall require any Lender to exercise any such right
or shall affect the right of any Lender to exercise, and retain the benefits of
exercising, any such right with respect to any other Indebtedness or obligation
of any Credit Party. If, under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a setoff to which
this Section 4.07 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights of the Lenders entitled under this Section 4.07 to share in the
benefits of any recovery on such secured claim.

(e) Notwithstanding anything to the contrary contained in this Section 4.07, in
the event that any Defaulting Lender exercises any right of setoff, (i) all
amounts so set off will be paid over immediately to Administrative Agent for
further application in accordance with the provisions of Section 2.14 and,
pending such payment, will be segregated by such Defaulting Lender from its
other funds and deemed held in trust for the benefit of Administrative Agent and
the Lenders and (ii) the Defaulting Lender will provide promptly to
Administrative Agent a statement describing in reasonable detail the Obligations
owing to such Defaulting Lender as to which it exercised such right of setoff.

ARTICLE V.

YIELD PROTECTION, ETC.

SECTION 5.01. Increased Costs.

(a) If any Change in Law shall:

(i) subject any Lender to any Tax with respect to this Agreement, any Note or
any Loan made by it, any deposits, reserves, other liabilities or capital
attributable thereto or change the basis of taxation of payments to such Lender
in respect thereof by any Governmental Authority (except for any Covered Taxes
or Excluded Taxes);

 

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(ii) impose, modify or hold applicable any reserve, special deposit, compulsory
loan, insurance charge or similar requirement against assets held by, deposits
or other liabilities in or for the account of, advances, loans or other
extensions of credit by, or any other acquisition of funds by, any office of
such Lender, in each case, that is not otherwise included in the determination
of the LIBO Rate hereunder; or

(iii) impose on any Lender or the London interbank market any other condition,
cost or expense (other than Taxes) affecting this Agreement or LIBOR Loans made
by such Lender;

and the result of any of the foregoing is to materially increase the cost to
such Lender of making, converting into, continuing or maintaining LIBOR Loans
(or of maintaining its obligation to make any LIBOR Loans), then, in any such
case, Borrower shall, within 10 days of written demand therefor, pay such Lender
any additional amounts necessary to compensate such Lender for such increased
cost; provided that requests for additional compensation due to increased costs
shall be limited to circumstances generally affecting the banking market and for
which it is the general policy or practice of such requesting Lender to demand
such compensation in similar circumstances under comparable provisions of other
similar agreements. If any Lender becomes entitled to claim any additional
amounts pursuant to this subsection, it shall promptly notify Borrower, through
Administrative Agent, of the event by reason of which it has become so entitled.

(b) A certificate as to any additional amounts setting forth the calculation of
such additional amounts pursuant to this Section 5.01 submitted by such Lender,
through Administrative Agent, to Borrower shall be conclusive in the absence of
clearly demonstrable error. Without limiting the survival of any other covenant
hereunder, this Section 5.01 shall survive the termination of this Agreement and
the payment of the Notes and all other Obligations payable hereunder.

(c) In the event that any Lender shall have determined that any Change in Law
affecting such Lender or any Lending Office of such Lender or the Lender’s
holding company with regard to capital or liquidity requirements, does or shall
have the effect of reducing the rate of return on such Lender’s or such holding
company’s capital as a consequence of its obligations hereunder, the Commitments
of such Lender, or the Loans made by such Lender, to a level below that which
such Lender or such holding company could have achieved but for such Change in
Law (taking into consideration such Lender’s policies and the policies of such
Lender’s holding company with respect to capital adequacy), then from time to
time, after submission by such Lender or Borrower (with a copy to Administrative
Agent) of a written request therefor (setting forth in reasonable detail the
amount payable to the affected Lender and the basis for such request), Borrower
shall promptly pay to such Lender such additional amount or amounts as will
compensate such Lender for such reduction; provided that requests for additional
compensation due to increased costs shall be limited to circumstances generally
affecting the banking market and for which it is the general policy or practice
of such requesting Lender to demand such compensation in similar circumstances
under comparable provisions of other similar agreements.

(d) Failure or delay on the part of any Lender to demand compensation pursuant
to this Section 5.01 shall not constitute a waiver of such Lender’s right to
demand such compensation; provided, however, that Borrower shall not be required
to compensate a Lender pursuant to this Section 5.01 for any increased costs or
reductions incurred more than ninety (90) days prior to the date that such
Lender notifies Borrower of the change in law giving rise to such increased
costs incurred or reductions suffered and of such Lender’s intention to claim
compensation therefor; provided, further, that if the Change in Law giving rise
to such increased costs or reductions is retroactive, then the 90-day period
referred to above shall be extended to include the period of retroactive effect
thereof.

 

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SECTION 5.02. Inability To Determine Interest Rate. If prior to the first day of
any Interest Period: (a) Administrative Agent shall have determined in good
faith (which determination shall be conclusive and binding upon Borrower) that,
by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the LIBO Base Rate for such
Interest Period or (b) Administrative Agent shall have received notice from the
Required Lenders that Dollar deposits are not available in the relevant amount
and for the relevant Interest Period available to the Required Lenders in the
London interbank market or (c) the Required Lenders determine in good faith that
the LIBO Rate for any requested Interest Period with respect to a proposed LIBOR
Loan does not adequately and fairly reflect the cost to such Lenders of funding
such LIBOR Loans (in each case, “Impacted Loans”), Administrative Agent shall
give electronic mail or telephonic notice thereof to Borrower and the Lenders as
soon as practicable thereof. If such notice is given, Borrower may revoke any
pending request for a Borrowing of, conversion to or continuation of LIBOR
Loans, or if Borrower does not make such revocation, (x) any LIBOR Loans
requested to be made on the first day of such Interest Period shall be made as
ABR Loans, (y) any Loans that were to have been converted on the first day of
such Interest Period to LIBOR Loans shall be converted to, or continued as, ABR
Loans and (z) any outstanding LIBOR Loans shall be converted, on the first day
of such Interest Period, to ABR Loans. Until such notice has been withdrawn by
Administrative Agent (which Administrative Agent agrees to do if the
circumstances giving rise to such notice cease to exist), no further LIBOR Loans
shall be made, or continued as such, nor shall Borrower have the right to
convert Loans to, LIBOR Loans.

Notwithstanding the foregoing, if there are Impacted Loans as provided above,
Administrative Agent, in consultation with Borrower and the affected Lenders,
may establish an alternative interest rate for the Impacted Loans, in which
case, such alternative rate of interest shall apply with respect to the Impacted
Loans (to the extent Borrower does not elect to maintain such Impacted Loans as
ABR Loans) until (1) Administrative Agent revokes the notice delivered with
respect to the Impacted Loans (which Administrative Agent agrees to do if the
circumstances giving rise to Impacted Loans cease to exist), (2) Administrative
Agent or the Required Lenders notify Administrative Agent and Borrower that such
alternative interest rate does not adequately and fairly reflect the cost to
such Lenders of funding the Impacted Loans, or (3) any Lender determines that
any Law has made it unlawful, or that any Governmental Authority has asserted
that it is unlawful, for such Lender or its applicable Lending Office to make,
maintain or fund Loans whose interest is determined by reference to such
alternative rate of interest or to determine or charge interest rates based upon
such rate or any Governmental Authority has imposed material restrictions on the
authority of such Lender to do any of the foregoing and provides Administrative
Agent and Borrower written notice thereof.

SECTION 5.03. Illegality. Notwithstanding any other provision of this Agreement,
in the event that any change after the date hereof in any Requirement of Law or
in the interpretation or application thereof shall make it unlawful for any
Lender or its Applicable Lending Office to honor its obligation to make or
maintain LIBOR Loans hereunder (and, in the sole opinion of such Lender, the
designation of a different Applicable Lending Office would either not avoid such
unlawfulness or would be disadvantageous to such Lender), then such Lender shall
promptly notify Borrower thereof (with a copy to Administrative Agent) and such
Lender’s obligation to make or continue, or to convert Loans of any other Type
into, LIBOR Loans shall be suspended until such time as such Lender may again
make and maintain LIBOR Loans (in which case the provisions of Section 5.04
shall be applicable).

SECTION 5.04. Treatment of Affected Loans. If the obligation of any Lender to
make LIBOR Loans or to continue, or to convert ABR Loans into, LIBOR Loans shall
be suspended pursuant to Section 5.03, such Lender’s LIBOR Loans shall be
automatically converted into ABR Loans on the last day(s) of the then current
Interest Period(s) for such LIBOR Loans (or on such earlier date as such Lender
may specify to Borrower with a copy to Administrative Agent as is required by
law) and, unless and until

 

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such Lender gives notice as provided below that the circumstances specified in
Section 5.03 which gave rise to such conversion no longer exist:

(i) to the extent that such Lender’s LIBOR Loans have been so converted, all
payments and prepayments of principal which would otherwise be applied to such
Lender’s LIBOR Loans shall be applied instead to its ABR Loans; and

(ii) all Loans which would otherwise be made or continued by such Lender as
LIBOR Loans shall be made or continued instead as ABR Loans and all ABR Loans of
such Lender which would otherwise be converted into LIBOR Loans shall remain as
ABR Loans.

If such Lender gives notice to Borrower with a copy to Administrative Agent that
the circumstances specified in Section 5.03 which gave rise to the conversion of
such Lender’s LIBOR Loans pursuant to this Section 5.04 no longer exist (which
such Lender agrees to do promptly upon such circumstances ceasing to exist) at a
time when LIBOR Loans are outstanding, such Lender’s ABR Loans shall be
automatically converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding LIBOR Loans, to the extent necessary so that,
after giving effect thereto, all Loans held by the Lenders holding LIBOR Loans
and by such Lender are held pro rata (as to principal amounts, Types and
Interest Periods) in accordance with their respective Commitments.

SECTION 5.05. Compensation.

(a) Borrower agrees to indemnify each Lender and to hold each Lender harmless
from any loss or expense (excluding any loss of profits or margin) which such
Lender may sustain or incur as a consequence of (1) default by Borrower in
payment when due of the principal amount of or interest on any LIBOR Loan,
(2) default by Borrower in making a borrowing of, conversion into or
continuation of LIBOR Loans after Borrower has given a notice requesting the
same in accordance with the provisions of this Agreement, (3) Borrower making
any prepayment other than on the date specified in the relevant prepayment
notice, or (4) the conversion or the making of a payment or a prepayment
(including any repayments or prepayments made pursuant to Sections 2.09 or 2.10
or as a result of an acceleration of Loans pursuant to Section 11.01 or as a
result of the replacement of a Lender pursuant to Section 2.11 or 13.04(b)) of
LIBOR Loans on a day which is not the last day of an Interest Period with
respect thereto, including in each case, any such loss (excluding any loss of
profits or margin) or expense arising from the reemployment of funds obtained by
it or from fees payable to terminate the deposits from which such funds were
obtained; provided that no such amounts under this Section 5.05(a) shall be
payable by Borrower in connection with any termination in accordance with
Section 2.12(b) of any Interest Period of one month or shorter.

(b) For the purpose of calculation of all amounts payable to a Lender under this
Section 5.05 each Lender shall be deemed to have actually funded its relevant
LIBOR Loan through the purchase of a deposit bearing interest at the LIBO Base
Rate in an amount equal to the amount of the LIBOR Loan and having a maturity
comparable to the relevant Interest Period; provided, however, that each Lender
may fund each of its LIBOR Loans in any manner it sees fit, and the foregoing
assumption shall be utilized only for the calculation of amounts payable under
this subsection. Any Lender requesting compensation pursuant to this
Section 5.05 will furnish to Administrative Agent and Borrower a certificate
setting forth the basis and amount of such request and such certificate, absent
manifest error, shall be conclusive. Without limiting the survival of any other
covenant hereunder, this covenant shall survive the termination of this
Agreement and the payment of the Obligations and all other amounts payable
hereunder.

 

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SECTION 5.06. Net Payments.

(a) All payments by or on account of any obligation of any Credit Party under
any Credit Document shall be made without deduction or withholding any Taxes,
except as required by applicable Laws. If any applicable Laws require the
deduction or withholding of any Tax in respect of any such payment by
Administrative Agent, a Credit Party or any other applicable withholding agent,
then (i) the applicable withholding agent shall withhold or make such deductions
as are determined by the applicable withholding agent to be required, (ii) the
applicable withholding agent shall timely pay the full amount withheld or
deducted to the relevant Governmental Authority in accordance with applicable
Law, and (iii) to the extent that the withholding or deduction is made on
account of Covered Taxes, the sum payable by the applicable Credit Party shall
be increased as necessary so that after any required withholding or deductions
are made (including withholding or deductions applicable to additional sums
payable under this Section 5.06), the applicable Lender (or, in the case of
payments made to Administrative Agent for its own account, Administrative Agent)
receives an amount equal to the sum it would have received had no such
withholding or deduction been made. Borrower shall furnish to Administrative
Agent within 45 days after the date the payment of any Taxes by a Credit Party
pursuant to this Section 5.06 documentation reasonably satisfactory to
Administrative Agent evidencing such payment by the applicable Credit Party. The
Credit Parties shall jointly and severally indemnify and hold harmless
Administrative Agent and each Lender, and reimburse Administrative Agent or such
Lender (as applicable) upon its written request, for the amount of any Covered
Taxes payable or paid by such Lender or Administrative Agent (including Covered
Taxes imposed or asserted on amounts payable under this Section 5.06) and for
any other reasonable expenses arising therefrom or with respect thereto, in each
case, whether or not such Covered Taxes were correctly or legally imposed. Such
written request shall include a certificate of such Lender or Administrative
Agent setting forth in reasonable detail the basis of such request and such
certificate, absent manifest error, shall be conclusive.

(b) In addition, Borrower agrees to (and shall timely) pay all present or future
stamp, court or documentary, intangible, recording, filing or similar Taxes
which arise from any payment made under or from the execution, delivery,
performance, enforcement filing, recordation or registration of, or otherwise
with respect to, any Credit Document (hereinafter referred to as “Other Taxes”).

(c) (i) Any Lender that is entitled to an exemption from or reduction of
withholding Tax with respect to payments made under any Credit Document shall
deliver to Borrower and Administrative Agent, at the time or times reasonably
requested by Borrower or Administrative Agent, such properly completed and
executed documentation reasonably requested by Borrower or Administrative Agent
as will permit such payments to be made without withholding or at a reduced rate
of withholding. In addition, any Lender, if reasonably requested by Borrower or
Administrative Agent, shall deliver such other documentation prescribed by
applicable Law or reasonably requested by Borrower or Administrative Agent as
will enable Borrower or Administrative Agent to determine whether or not such
Lender is subject to backup withholding or information reporting requirements.

(ii) Each Lender that is not a U.S. Person (a “Non-U.S. Lender”) agrees to the
extent it is legally eligible to do so to deliver to Borrower and Administrative
Agent on or prior to the date it becomes a party to this Agreement, and from
time to time upon the reasonable request of Borrower or Administrative Agent,
whichever of the following is applicable: (1) in the case of a Non-U.S. Lender
claiming the benefits of an income tax treaty to which the United States is a
party, two executed original copies of IRS Form W-8BEN or IRS Form W-8BEN-E
establishing an exemption from, or reduction of, U.S. federal withholding Tax;
(2) two executed original copies of IRS Form W-8ECI; (3) in the case of a
Non-U.S. Lender claiming the benefits of the exemption for portfolio interest
under Section 881(c) or 871(h) of the Code, (x) a certificate substantially in
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U.S. Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the
Code, a “10 percent shareholder” of Borrower within the meaning of
Section 871(h)(3)(B) of the Code, or a CFC related to Borrower as described in
Section 881(c)(3)(C) of the Code and that no interest payments in connection
with any Credit Documents are effectively connected with the Non-U.S. Lender’s
conduct of a U.S. trade or business (a “U.S. Tax Compliance Certificate”) and
(y) two executed original copies of IRS Form W-8BEN or IRS Form W-8BEN-E; or
(4) to the extent a Non-U.S. Lender is not the beneficial owner (for example,
where such Foreign Lender is a partnership or a participating Lender), two
executed original copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS
Form W-8BEN, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially
in the form of Exhibit D-2 or D-3, IRS Form W-9, and/or other certification
documents from each beneficial owner, as applicable; provided that if the
Non-U.S. Lender is a partnership (and not a participating Lender) and one or
more direct or indirect partners of such Non-U.S. Lender are claiming the
portfolio interest exemption, such Non-U.S. Lender may provide a U.S. Tax
Compliance Certificate substantially in the form of Exhibit D-4 on behalf of
each such direct and indirect partner. Any Non-U.S. Lender shall, to the extent
it is legally eligible to do so, deliver to Borrower and Administrative Agent
(in such number of copies as shall be requested by the recipient) on or about
the date on which such Non-U.S. Lender becomes a Lender under this Agreement
(and from time to time thereafter upon the reasonable request of Borrower or
Administrative Agent), executed copies of any other documentation prescribed by
applicable Law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by applicable Law to permit Borrower or
Administrative Agent to determine the withholding or deduction required to be
made, if any.

(iii) Each Lender that is a U.S. Person shall deliver at the time(s) and in the
manner(s) prescribed by applicable Law, to Borrower and Administrative Agent (as
applicable), a properly completed and duly executed IRS Form W-9, or any
successor form, certifying that such Person is exempt from United States backup
withholding.

(iv) If a payment made to a Lender under any Credit Document would be subject to
U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender
shall deliver to Borrower and Administrative Agent at the time or times
prescribed by Law and at such time or times reasonably requested by Borrower or
Administrative Agent such documentation prescribed by applicable Law (including
as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional
documentation reasonably requested by Borrower or Administrative Agent as may be
necessary for Borrower and Administrative Agent to comply with their obligations
under FATCA, to determine whether such Lender has complied with such Lender’s
obligations under FATCA, and to determine the amount to deduct and withhold, if
any, from such payment. For purposes of this Section 5.06(c)(iv), FATCA shall
include any amendments made to FATCA after the date of this Agreement.

(v) Each Lender agrees that if any documentation it previously delivered expires
or becomes obsolete or inaccurate in any respect, it shall update such
documentation or promptly notify Borrower and Administrative Agent in writing of
its legal ineligibility to do so. Notwithstanding any other provision of this
Section 5.06(c), a Lender shall not be required to deliver any documentation
that such Lender is not legally eligible to deliver. Each Lender hereby
authorizes Administrative Agent to deliver to the Credit Parties and to any
successor Administrative Agent any documentation provided by such Lender to
Administrative Agent pursuant to this Section 5.06(c).

(d) On or before the date Administrative Agent becomes a party to this
Agreement, if Administrative Agent is a U.S. Person, it shall deliver to
Borrower two executed originals of IRS Form

 

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W-9 certifying that it is exempt from U.S. federal backup withholding.
Otherwise, Administrative Agent (including any successor Administrative Agent
that is not a U.S. Person) shall deliver two duly completed copies of IRS Form
W-8ECI (with respect to any payments to be received on its own behalf) and IRS
Form W-8IMY (for all other payments) certifying that it is a “U.S. branch” and
that the payments it receives for the account of Lenders are not effectively
connected with the conduct of its trade or business in the United States and
that it is using such form as evidence of its agreement with the Credit Parties
to be treated as a U.S. Person with respect to such payments (and the Credit
Parties and Administrative Agent agree to so treat Administrative Agent as a
U.S. Person with respect to such payments). Notwithstanding anything to the
contrary in this Section 5.06(d), Administrative Agent shall not be required to
provide any documentation that Administrative Agent is not legally eligible to
deliver as a result of a Change in Law after the Closing Date.

(e) Any Lender requiring Borrower to pay any Covered Taxes or additional amounts
to such Lender or any Governmental Authority for the account of such Lender
pursuant to this Section 5.06 agrees to use (at the Credit Parties’ expense)
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to change the jurisdiction of its Applicable Lending Office if, in
the judgment of such Lender, the making of such change would avoid the need for,
or materially reduce the amount of, any such additional amounts that may
thereafter accrue and would not be otherwise disadvantageous to such Lender.

(f) If Administrative Agent or any Lender receives a cash refund in respect of
an overpayment of Taxes from a Governmental Authority with respect to, and
actually resulting from, an amount of Taxes actually paid to or on behalf of
Administrative Agent or such Lender by Borrower or any other Credit Party, then
Administrative Agent or such Lender shall notify Borrower of such refund and
forward the proceeds of such refund (or relevant portion thereof) to Borrower as
reduced by any reasonable expense or liability incurred by Administrative Agent
or such Lender in connection with obtaining such refund (including any Taxes
imposed with respect to such refund); provided, however, that Borrower, upon the
request of Administrative Agent or such Lender, shall repay the amount paid over
to Borrower (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to Administrative Agent or such Lender in the
event Administrative Agent or such Lender is required to repay such refund to
such Governmental Authority. This Section 5.06(f) shall not be construed to
require Administrative Agent or any Lender to make available its tax returns (or
any other information relating to its taxes that it deems confidential) to
Borrower or any other Person. Notwithstanding anything to the contrary in this
Section 5.06(f), in no event will Administrative Agent or any Lender be required
to pay any amount to any Credit Party pursuant to this Section 5.06(f) the
payment of which would place Administrative Agent or such Lender in a less
favorable net after-Tax position than it would have been in if the Tax subject
to indemnification and giving rise to such refund had not been deducted,
withheld or otherwise imposed and the indemnification payments or additional
amounts with respect to such Tax had never been paid.

(g) For the avoidance of doubt, for purposes of this Section 5.06, the term
“applicable Law” includes FATCA.

ARTICLE VI.

GUARANTEES

SECTION 6.01. The Guarantees. Each (a) Guarantor, jointly and severally with
each other Guarantor, hereby guarantees as primary obligor and not as surety to
each Secured Party and its successors and assigns the prompt payment and
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by acceleration, demand or otherwise) of the principal of and interest
(including any interest, fees, costs, expenses, or charges that would accrue but
for the provisions of the Bankruptcy Code or other applicable Debtor Relief Law
after the filing of any bankruptcy or insolvency petition) on the Loans made by
the Lenders to, and the Notes held by each Lender of, Borrower, and (b) Credit
Party, jointly and severally with each other Credit Party, hereby guarantees as
primary obligor and not as surety to each Secured Party and its successors and
assigns the prompt payment and performance in full when due (whether at stated
maturity, by acceleration or otherwise) of the principal of and interest
(including any interest, fees, costs, expenses or charges that would accrue but
for the provisions of the Bankruptcy Code or other applicable Debtor Relief Law
after the filing of any bankruptcy or insolvency petition) of all other
Obligations from time to time owing to the Secured Parties by any other Credit
Party under any Credit Document, now or hereinafter created, incurred or made,
whether absolute or contingent, liquidated or unliquidated and strictly in
accordance with the terms thereof; provided, that as to each Guarantor the
obligations guaranteed by such Guarantor hereunder shall not include any
Excluded Swap Obligations in respect of such Guarantor (such obligations being
guaranteed pursuant to clauses (a) and (b) above being herein collectively
called the “Guaranteed Obligations” (it being understood that the Guaranteed
Obligations of Borrower shall be limited to those referred to in clause
(b) above and the Guaranteed Obligations of each other Guarantor shall not
include any Obligations with respect to which such Guarantor is the primary
obligor)). Each Credit Party, jointly and severally with each other Credit
Party, hereby agrees that if any other Credit Party shall fail to pay in full
when due (whether at stated maturity, by acceleration or otherwise) any of the
Guaranteed Obligations, such Credit Party will promptly pay the same, without
any demand or notice whatsoever, and that in the case of any extension of time
of payment or renewal of any of the Guaranteed Obligations, the same will be
promptly paid in full when due (whether at extended maturity, by acceleration or
otherwise) in accordance with the terms of such extension or renewal.

SECTION 6.02. Obligations Unconditional. The obligations of the Credit Parties
under Section 6.01 shall constitute a guaranty of payment (and not of
collection) and are absolute, irrevocable and unconditional, joint and several,
irrespective of the value, genuineness, validity, regularity or enforceability
of the Guaranteed Obligations under this Agreement, the Notes or any other
agreement or instrument referred to herein or therein, or any substitution,
release or exchange of any other guarantee of or security for any of the
Guaranteed Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor
(except for Payment in Full). Without limiting the generality of the foregoing,
it is agreed that the occurrence of any one or more of the following shall not
alter or impair the liability of any of the Credit Parties with respect to its
respective guaranty of the Guaranteed Obligations which shall remain absolute,
irrevocable and unconditional under any and all circumstances as described
above:

(i) at any time or from time to time, without notice to the Credit Parties, the
time for any performance of or compliance with any of the Guaranteed Obligations
shall be extended, or such performance or compliance shall be waived;

(ii) the maturity of any of the Guaranteed Obligations shall be accelerated, or
any of the Guaranteed Obligations shall be amended in any respect, or any right
under the Credit Documents or any other agreement or instrument referred to
herein or therein shall be amended or waived in any respect or any other
guarantee of any of the Guaranteed Obligations or any security therefor shall be
released or exchanged in whole or in part or otherwise dealt with;

(iii) the release of any other Credit Party pursuant to Section 6.08;

 

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(iv) any renewal, extension or acceleration of, or any increase in the amount of
the Guaranteed Obligations, or any amendment, supplement, modification or waiver
of, or any consent to departure from, the Credit Documents;

(v) any failure or omission to assert or enforce or agreement or election not to
assert or enforce, delay in enforcement, or the stay or enjoining, by order of
court, by operation of law or otherwise, of the exercise or enforcement of, any
claim or demand or any right, power or remedy (whether arising under any Credit
Documents, at law, in equity or otherwise) with respect to the Guaranteed
Obligations or any agreement relating thereto, or with respect to any other
guaranty of or security for the payment of the Guaranteed Obligations;

(vi) any settlement, compromise, release, or discharge of, or acceptance or
refusal of any offer of payment or performance with respect to, or any
substitutions for, the Guaranteed Obligations or any subordination of the
Guaranteed Obligations to any other obligations;

(vii) the validity, perfection, non-perfection or lapse in perfection, priority
or avoidance of any security interest or lien, the release of any or all
collateral securing, or purporting to secure, the Guaranteed Obligations or any
other impairment of such collateral;

(viii) any exercise of remedies with respect to any security for the Guaranteed
Obligations (including, without limitation, any collateral, including the
Collateral securing or purporting to secure any of the Guaranteed Obligations)
at such time and in such order and in such manner as Administrative Agent and
the Secured Parties may decide and whether or not every aspect thereof is
commercially reasonable and whether or not such action constitutes an election
of remedies and even if such action operates to impair or extinguish any right
of reimbursement or subrogation or other right or remedy that any Credit Party
would otherwise have and without limiting the generality of the foregoing or any
other provisions hereof, each Credit Party hereby expressly waives any and all
benefits which might otherwise be available to such Credit Party as a surety
under applicable law, including, without limitation, California Civil Code
Sections 2809, 2810, 2819, 2939, 2845, 2848, 2849, 2850, 2855, 2899 and 3433,
and in the event that Nevada law applies to this Agreement or any portion
hereof, Guarantors, and each of them, hereby waive the provisions of
Section 40.430 of the Nevada Revised Statutes; or

(ix) any other circumstance whatsoever which may or might in any manner or to
any extent vary the risk of any Credit Party as a guarantor in respect of the
Guaranteed Obligations or which constitutes, or might be construed to
constitute, an equitable or legal discharge of any Credit Party as a guarantor
of the Guaranteed Obligations, or of such Credit Party under the guarantee
contained in this Article 6 or of any security interest granted by any Credit
Party in its capacity as a guarantor of the Guaranteed Obligations, whether in a
proceeding under the Bankruptcy Code or under any other federal, state or
foreign bankruptcy, insolvency, receivership, or similar law, or in any other
instance.

The Credit Parties hereby expressly waive diligence, presentment, demand of
payment, protest, marshaling and all notices whatsoever, and any requirement
that any Secured Party thereof exhaust any right, power or remedy or proceed
against any Credit Party under this Agreement, the Notes or any other agreement
or instrument referred to herein or therein, or against any other Person under
any other guarantee of, or security for, any of the Guaranteed Obligations. The
Credit Parties waive any and all notice of the creation, renewal, extension,
waiver, termination or accrual of any of the Guaranteed Obligations and notice
of or proof of reliance by any Secured Party thereof upon this guarantee or
acceptance of this guarantee, and the Guaranteed Obligations, and any of them,
shall conclusively be

 

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deemed to have been created, contracted or incurred in reliance upon this
guarantee, and all dealings between the Credit Parties and the Secured Parties
shall likewise be conclusively presumed to have been had or consummated in
reliance upon this guarantee. This guarantee shall be construed as a continuing,
absolute, irrevocable and unconditional guarantee of payment and performance
without regard to any right of offset with respect to the Guaranteed Obligations
at any time or from time to time held by the Secured Parties, and the
obligations and liabilities of the Credit Parties hereunder shall not be
conditioned or contingent upon the pursuit by the Secured Parties or any other
Person at any time of any right or remedy against any Credit Party or against
any other Person which may be or become liable in respect of all or any part of
the Guaranteed Obligations or against any collateral security or guarantee
therefor or right of offset with respect thereto. This guarantee shall remain in
full force and effect and be binding in accordance with and to the extent of its
terms upon the Credit Parties and the successors and assigns thereof, and shall
inure to the benefit of the Secured Parties, and their respective successors and
assigns, notwithstanding that from time to time during the term of this
Agreement there may be no Guaranteed Obligations outstanding.

For the avoidance of doubt, nothing in this Section 6.02 shall permit amendments
to the Credit Documents or an acceleration of the Obligations other than as set
forth in the Credit Documents.

SECTION 6.03. Reinstatement. The obligations of the Credit Parties under this
Article VI shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of any Credit Party in respect of the
Guaranteed Obligations is rescinded or avoided or must be otherwise restored by
any holder of any of the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise. The Credit Parties
jointly and severally agree that they will indemnify each Secured Party on
demand for all reasonable costs and expenses (including reasonable fees of
counsel) incurred by such Secured Party in connection with such rescission,
avoidance or restoration, including any such costs and expenses incurred in
defending against any claim alleging that such payment constituted a preference,
fraudulent transfer or similar payment under any bankruptcy, insolvency or
similar law, other than any costs or expenses resulting from the gross
negligence, bad faith or willful misconduct of, or material breach by, such
Secured Party.

SECTION 6.04. Subrogation; Subordination. Each Credit Party hereby agrees that
until the payment and satisfaction in full in cash of all Guaranteed Obligations
and the expiration and termination of the Commitments of the Lenders under this
Agreement it shall not exercise any right or remedy arising by reason of any
performance by it of its guarantee in Section 6.01, whether by subrogation,
contribution or otherwise, against any Credit Party of any of the Guaranteed
Obligations or any security for any of the Guaranteed Obligations. The payment
of any amounts due with respect to any indebtedness of any Credit Party now or
hereafter owing to any Credit Party by reason of any payment by such Credit
Party under the Guarantee in this Article VI is hereby subordinated to the prior
Payment in Full in cash of the Guaranteed Obligations. Upon the occurrence and
during the continuance of an Event of Default, each Credit Party agrees that it
will not demand, sue for or otherwise attempt to collect any such indebtedness
of any other Credit Party to such Credit Party until the Obligations shall have
been Paid in Full in cash. If an Event of Default has occurred and is
continuing, and any amounts are paid to the Credit Parties in violation of the
foregoing limitation, such amounts shall be collected, enforced and received by
such Credit Party as trustee for the Secured Parties and be paid over to
Administrative Agent on account of the Guaranteed Obligations without affecting
in any manner the liability of such Credit Party under the other provisions of
the guaranty contained herein.

SECTION 6.05. Remedies. The Credit Parties jointly and severally agree that, as
between the Credit Parties and the Lenders, the obligations of any Credit Party
under this Agreement and the Notes may be declared to be forthwith due and
payable as provided in Article XI (and shall be deemed to have

 

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become automatically due and payable in the circumstances provided in said
Article XI) for purposes of Section 6.01, notwithstanding any stay, injunction
or other prohibition preventing such declaration (or such obligations from
becoming automatically due and payable arising under the Bankruptcy Code or any
other federal or state bankruptcy, insolvency or other law providing for
protection from creditors) as against such other Credit Parties and that, in the
event of such declaration (or such obligations being deemed to have become
automatically due and payable), such obligations (whether or not due and payable
by Borrower) shall forthwith become due and payable by the other Credit Parties
for purposes of Section 6.01.

SECTION 6.06. Continuing Guarantee. The guarantee in this Article VI is a
continuing guarantee of payment and performance, and shall apply to all
Guaranteed Obligations whenever arising.

SECTION 6.07. General Limitation on Guarantee Obligations. In any action or
proceeding involving any state corporate law, or any state, federal or foreign
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Credit Party under Section 6.01
would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under Section 6.01, then, notwithstanding any
other provision to the contrary, the amount of such liability shall, without any
further action by such Credit Party, any Secured Party or any other Person, be
automatically limited and reduced to the highest amount that is valid and
enforceable and not subordinated to the claims of other creditors as determined
in such action or proceeding.

SECTION 6.08. Release of Guarantors. If, in compliance with the terms and
provisions of the Credit Documents, (i) the Equity Interests of any Guarantor
are directly or indirectly sold or otherwise transferred such that such
Guarantor no longer constitutes a Restricted Subsidiary (a “Transferred
Guarantor”) to a Person or Persons, none of which is Borrower or a Restricted
Subsidiary, or (ii) any Restricted Subsidiary is designated as or becomes an
Excluded Subsidiary, such Transferred Guarantor or Excluded Subsidiary, as
applicable, upon the consummation of such sale, transfer or designation or such
Person becoming an Excluded Subsidiary, as applicable, shall be automatically
released from its obligations under this Agreement (including under
Section 13.03 hereof) and the other Credit Documents, and its obligations to
pledge and grant any Collateral owned by it pursuant to any Security Document,
and the pledge of Equity Interests in any Transferred Guarantor or any
Unrestricted Subsidiary to Collateral Agent pursuant to the Security Documents
shall be automatically released, and, so long as Borrower shall have provided
the Agents such certifications or documents as any Agent shall reasonably
request, Collateral Agent shall take such actions as are necessary to effect and
evidence each release described in this Section 6.08 in accordance with the
relevant provisions of the Security Documents and this Agreement.

SECTION 6.09. Keepwell. Each Qualified ECP Guarantor hereby jointly and
severally absolutely, unconditionally and irrevocably undertakes to provide such
funds or other support as may be needed from time to time by each other Credit
Party to honor all of its obligations under the Guarantee in respect of Swap
Obligations (provided, however, that each Qualified ECP Guarantor shall only be
liable under this Section 6.09 for the maximum amount of such liability that can
be hereby incurred without rendering its obligations under this Section 6.09, or
otherwise under the Guarantee, as it relates to such Credit Party, voidable
under applicable law relating to fraudulent conveyance or fraudulent transfer,
and not for any greater amount). The obligations of each Qualified ECP Guarantor
under this Section shall remain in full force and effect until the Payment in
Full of the Guaranteed Obligations. Each Qualified ECP Guarantor intends that
this Section 6.09 constitute, and this Section 6.09 shall be deemed to
constitute, a “keepwell, support, or other agreement” for the benefit of each
other Credit Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity
Exchange Act.

 

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SECTION 6.10. Right of Contribution. Each Credit Party hereby agrees that to the
extent that a Credit Party (a “Funding Credit Party”) shall have paid more than
its Fair Share (as defined below) of any payment made hereunder, such Credit
Party shall be entitled to seek and receive contribution from and against any
other Credit Party hereunder which has not paid its Fair Share of such payment.
Each Credit Party’s right of contribution shall be subject to the terms and
conditions of Section 6.04. The provisions of this Section 6.10 shall in no
respect limit the obligations and liabilities of any Credit Party to the Secured
Parties, and each Credit Party shall remain liable to the Secured Parties for
the full amount guaranteed by such Credit Party hereunder. “Fair Share” means,
with respect to a Credit Party as of any date of determination, an amount equal
to (i) the ratio of (A) the Adjusted Maximum Amount (as defined below) with
respect to such Credit Party to (B) the aggregate of the Adjusted Maximum
Amounts with respect to all Credit Parties multiplied by (ii) the aggregate
amount paid or distributed on or before such date by all Funding Credit Parties
under this Article VI in respect of the Guaranteed Obligations. “Adjusted
Maximum Amount” means, with respect to a Credit Party as of any date of
determination, the maximum aggregate amount of the obligations of such Credit
Party under this Article VI; provided that, solely for purposes of calculating
the “Adjusted Maximum Amount” with respect to any Credit Party for purposes of
this Section 6.10, any assets or liabilities of such Credit Party arising by
virtue of any rights to subrogation, reimbursement or indemnification or any
rights to or obligations of contribution hereunder shall not be considered as
assets or liabilities of such Credit Party. The amounts payable as contributions
hereunder shall be determined as of the date on which the related payment or
distribution is made by the applicable Funding Credit Party.

ARTICLE VII.

CONDITIONS PRECEDENT

SECTION 7.01. Conditions to Initial Extensions of Credit.

The obligations of Lenders to make any initial extension of credit hereunder are
subject to the satisfaction of the following:

(a) Corporate Documents. Administrative Agent shall have received copies of the
Organizational Documents of each Credit Party and evidence of all corporate or
other applicable authority for each Credit Party (including resolutions or
written consents and incumbency certificates) with respect to the execution,
delivery and performance of such of the Credit Documents to which each such
Credit Party is intended to be a party as of the Closing Date, certified as of
the Closing Date as complete and correct copies thereof by a Responsible Officer
of each Credit Party (or the member or manager or general partner of such Credit
Party, as applicable).

(b) Officer’s Certificate. Administrative Agent shall have received an Officer’s
Certificate of Borrower, dated the Closing Date, certifying that the conditions
set forth in Sections 7.01(j)(i), 7.01(j)(iii), 7.01(j)(iv) and 7.01(t) (giving
effect to the provisions contained therein) have been satisfied.

(c) Opinions of Counsel. Administrative Agent shall have received the following
opinions, each of which shall be addressed to Administrative Agent, Collateral
Agent and the Lenders, dated the Closing Date and covering such matters as
Administrative Agent shall reasonably request in a manner customary for
transactions of this type:

(i) an opinion of Latham & Watkins LLP, special counsel to the Credit Parties;
and

 

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(ii) opinions of local counsel to the Credit Parties in such jurisdictions as
are set forth in Schedule 7.01.

(d) Notes. Administrative Agent shall have received copies of the Notes, duly
completed and executed, for each Lender that requested a Note at least three
(3) Business Days prior to the Closing Date.

(e) Credit Agreement. Administrative Agent shall have received this Agreement
(a) executed and delivered by a duly authorized officer of each Credit Party and
(b) executed and delivered by a duly authorized officer of each Person that is a
Lender on the Closing Date.

(f) Filings and Lien Searches. Administrative Agent shall have received (i) UCC
financing statements in form appropriate for filing in the jurisdiction of
organization of each Credit Party, (ii) results of lien searches conducted in
the jurisdictions in which the Credit Parties are organized and (iii) security
agreements or other agreements in appropriate form for filing in the United
States Patent and Trademark Office and United States Copyright Office with
respect to intellectual property of the Credit Parties to the extent required
pursuant to the Security Agreement.

(g) Security Documents. (i) Administrative Agent shall have received the
Security Agreement, the Custodian Agreement and the Initial Perfection
Certificate, in each case duly authorized, executed and delivered by the
applicable Credit Parties, and (ii) Collateral Agent shall have received, to the
extent required pursuant to the Security Agreement and not prohibited by
applicable Requirements of Law (including, without limitation, any Gaming Laws),
(1) original certificates representing the certificated Pledged Securities (as
defined in the Security Agreement) required to be delivered to Collateral Agent
pursuant to the Security Agreement, accompanied by original undated stock powers
executed in blank (except as set forth on Schedule 9.15) (provided that, the
pledge of any Equity Interests of any Person that is subject to the jurisdiction
of the Nevada Gaming Authorities as a licensee or registered company under the
Nevada Gaming Laws will require the approval of the Nevada Gaming Authorities in
order to be effective (the “Affected Pledged Securities”), and no certificates
evidencing the Equity Interests of such Person or any undated stock powers or
assignments separate from certificate relating thereto shall be delivered to
Administrative Agent or any custodial agent thereof until such approval has been
obtained; provided further that, all certificates representing such Equity
Interests (and the corresponding undated stock powers or assignments separate
from certificate) shall be held in the State of Nevada by a bailee reasonably
agreed to by Administrative Agent pursuant to a Custodian Agreement in the form
of Exhibit U attached hereto), and (2) the promissory notes, intercompany notes,
instruments, and chattel paper identified under the name of such Credit Parties
in Schedule 6 to the Initial Perfection Certificate (other than such
certificates, promissory notes, intercompany notes, instruments and chattel
paper that constitute “Excluded Property” (as such term is defined in the
Security Agreement)), accompanied by undated notations or instruments of
assignment executed in blank, and all of the foregoing shall be reasonably
satisfactory to Administrative Agent in form and substance (in each case to the
extent required to be delivered to Collateral Agent pursuant to the terms of the
Security Agreement); provided, that this clause (ii) shall be deemed to have
been satisfied to the extent such deliverables are delivered to, or are in the
possession of, the collateral agent under the First Lien Credit Agreement if and
only to the extent such collateral agent holds such deliverables for the benefit
of the Collateral Agent and the Secured Parties subject to the First Lien/Second
Lien Intercreditor Agreement;

provided, however, that, each of the requirements set forth in this clause (g),
including the delivery of documents and instruments necessary to provide or
perfect a security interest intended to be created by the Security Documents
(except for the execution and delivery of the Security Agreement and to the
extent that a Lien on such Collateral may be perfected (A) by the filing of a
financing statement under the

 

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Uniform Commercial Code or the filing of intellectual property security
agreements with the United States Patent and Trademark Office or the United
States Copyright Office or (B) the delivery of a stock or equivalent
certificate, along with stock powers endorsed in blank, of Borrower’s material
Subsidiaries that are not Foreign Subsidiaries (other than Affected Pledged
Securities for which prior approval of Liens is required under applicable Gaming
Laws but has not been obtained) (and in the case of such stock or equivalent
certificates, only to the extent received from Padre Sellers after Borrower’s
commercially reasonable efforts)) shall not constitute conditions precedent to
any Borrowing or other extension of credit on the Closing Date after Borrower’s
use of commercially reasonable efforts to provide such items on or prior to the
Closing Date, and in no event, later than the time period set forth in
Section 9.15.

(h) Notice of Borrowing. Administrative Agent shall have received a Notice of
Borrowing duly executed by Borrower.

(i) Financial Statements. Administrative Agent shall have received (i) the
audited consolidated balance sheets and related consolidated statements of
operations, cash flows and shareholders’ equity of each of Borrower and its
Subsidiaries (before giving effect to the Transactions) and Padre and its
Subsidiaries for each of the three most recently completed fiscal years of
Borrower and Padre, respectively, ended at least 90 days before the Closing
Date, (ii) the unaudited consolidated balance sheets and related statements of
operations and cash flows of each of Borrower and its Subsidiaries (before
giving effect to the Transactions) and Padre and its Subsidiaries for each
fiscal quarter of Borrower and Padre, respectively, ended after December 31,
2016 (other than the fourth fiscal quarter of any fiscal year) and at least 45
days before the Closing Date and (iii) a pro forma balance sheet and related
statement of operations of Borrower and its Subsidiaries (including Padre and
its Subsidiaries) as of and for the twelve-month period ending with the latest
quarterly or annual period of Borrower covered by the financial statements set
forth in clauses (i) and (ii) above, after giving effect to the Transaction.

(j) Padre Acquisition.

(i) The Padre Acquisition shall have been, or shall substantially concurrently
with the initial extension of credit hereunder be, consummated in all material
respects in accordance with the terms of the Padre Acquisition Agreement.

(ii) The Padre Acquisition Agreement shall not have been altered, amended or
otherwise changed or supplemented or any provision waived or consented to
(including any change in the purchase price) in any manner that is materially
adverse to the interests of the Lenders or the Lead Arrangers without the prior
written consent (not to be unreasonably withheld, delayed or conditioned) of the
Initial Lenders (as defined in the Commitment Letter); provided that (x) any
reduction of the purchase price in respect of the Padre Acquisition will be
materially adverse to the Lenders and the Lead Arrangers, unless there is a
concurrent reduction in an amount equal to such reduction in, on a pro rata
basis, (A) the equity received by the Padre Sellers in Borrower, on the one
hand, and (B) the aggregate principal amount of the Term B Facility Loans and
the Closing Date First Lien Term Loans, on the other hand (and on a pro rata
basis across the Term B Facility Loans and the Closing Date First Lien Term
Loans); provided that, notwithstanding the foregoing, (I) in the event that the
Consolidated EBITDA for the four fiscal quarters ending on the last day of the
most recent fiscal quarter covered by the financial statements set forth in
clauses (i) and (ii) of Section 7.01(i) above, determined on a pro forma basis
as of the Closing Date, is greater than or equal to $165.0 million, up to
$10.0 million of any reduction may, at the direction of Borrower, be applied
solely to reduce the equity received by the Padre Sellers in Borrower and
(II) up to $10.0 million of any reduction in respect of the Term

 

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B Facility Loans and the Closing Date First Lien Term Loans may, at the
direction of Borrower, be applied solely to reduce the First Lien Term Loan
Facility and (y) any increase in the purchase price in respect of the Padre
Acquisition will not be deemed to be materially adverse to the interests of the
Lenders or the Lead Arrangers to the extent that cash on hand (including as a
result of borrowings under the First Lien Revolving Facility, and/or an increase
in the equity received by the Padre Seller in Borrower is used to fund any such
increase).

(iii) The representations and warranties made by or with respect to Padre and
its Subsidiaries in the Padre Acquisition Agreement that are material to the
interests of the Lenders shall be true and correct in all material respects, but
only to the extent that Borrower has the right to terminate its obligations
under the Padre Acquisition Agreement or to decline to consummate the Padre
Acquisition (in each case in accordance with the terms of the Padre Acquisition
Agreement) as a result of such breach of such representations and warranties in
the Padre Acquisition Agreement.

(iv) The Specified Representations shall be true and correct in all material
respects.

(k) Closing Date First Lien Term Loans. Prior to or substantially simultaneously
with the initial extensions of credit hereunder, Borrower shall have received
the proceeds of the Closing Date First Lien Term Loans. Administrative Agent
shall have received the First Lien/Second Lien Intercreditor Agreement duly
executed by the Second Lien Administrative Agent and each of the Credit Parties.

(l) Insurance. Administrative Agent shall have received evidence of insurance
complying with the requirements of Sections 9.02(a) and (b) and certificates
naming Collateral Agent as an additional insured and/or loss payee to the extent
required pursuant to such Sections.

(m) [Reserved].

(n) Repayment of Indebtedness. Borrower and its Restricted Subsidiaries shall
have effected (or will, on the Closing Date, effect) the repayment in full of
all obligations and indebtedness of Borrower and its Restricted Subsidiaries in
respect of the Existing Credit Agreements, including, without limitation, the
termination of all outstanding commitments in effect under the Existing Credit
Agreements (with the exception of obligations relating to each applicable
Existing Letter of Credit (as defined in the First Lien Credit Agreement) issued
thereunder), on customary terms and conditions and pursuant to documentation
reasonably satisfactory to Administrative Agent. All Liens and guarantees in
respect of such obligations shall have been terminated or released (or
arrangements for such termination or release reasonably satisfactory to
Administrative Agent shall have been made) (with the exception of obligations
relating to each applicable Existing Letter of Credit (as defined in the First
Lien Credit Agreement) issued thereunder), and Administrative Agent shall have
received (or will, on the Closing Date, receive) evidence thereof reasonably
satisfactory to Administrative Agent and a “pay-off” letter or letters
reasonably satisfactory to Administrative Agent with respect to such obligations
and such UCC termination statements, mortgage releases and other instruments, in
each case in proper form for recording, as Administrative Agent shall have
reasonably requested to release and terminate of record the Liens securing such
obligations (or arrangements for such termination or release reasonably
satisfactory to Administrative Agent shall have been made).

(o) [Reserved].

(p) [Reserved].

 

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(q) Solvency. Administrative Agent shall have received a certificate in the form
of Exhibit G from the chief financial officer or other equivalent officer of
Borrower with respect to the Solvency of Borrower (on a consolidated basis with
its Subsidiaries), immediately after giving effect to the consummation of the
Transactions.

(r) Payment of Fees and Expenses. To the extent invoiced at least two
(2) Business Days prior to the Closing Date (unless otherwise agreed by
Borrower), all costs, fees, expenses (including, without limitation, reasonable
legal fees and expenses of Cahill Gordon & Reindel LLP, and of special gaming
and local counsel in any applicable jurisdiction, if any) of Administrative
Agent, Lead Arrangers and (in the case of fees only) the Lenders required to be
paid by this Agreement or by the Commitment Letter, in each case, payable to
Administrative Agent, Lead Arrangers and/or Lenders in respect of the
Transactions, shall have been, or shall substantially concurrently with the
initial extension of credit hereunder be, paid to the extent due.

(s) Patriot Act. On or prior to the Closing Date, Administrative Agent shall
have received at least three (3) Business Days prior to the Closing Date all
documentation and other information reasonably requested in writing at least ten
(10) Business Days prior to the Closing Date by Administrative Agent that
Administrative Agent reasonably determines is required by regulatory authorities
from the Credit Parties under applicable “know your customer” and anti-money
laundering rules and regulations, including without limitation the Act.

(t) Material Adverse Changes. Since June 10, 2017, there shall not have occurred
any change, event, circumstance or development that, individually or in the
aggregate, has had, or is reasonably likely to have a Padre Material Adverse
Effect.

SECTION 7.02. Conditions to All Extensions of Credit. Subject to the limitations
set forth in Section 2.12 and the applicable Incremental Joinder Agreement, the
obligations of the Lenders to make any Loan or otherwise extend any credit to
Borrower upon the occasion of each Borrowing or other extension of credit
hereunder (including the initial borrowing) after the Closing Date is subject to
the conditions precedent that:

(a) No Default or Event of Default; Representations and Warranties True. Both
immediately prior to the making of such Loan or other extension of credit and
also after giving effect thereto and to the intended use thereof:

(i) no Default or Event of Default shall have occurred and be continuing
(provided that this clause (i) shall not apply to any extensions of credit
pursuant to an Incremental Commitment to the extent provided in Section 2.12 and
the applicable Incremental Joinder Agreement); and

(ii) each of the representations and warranties made by the Credit Parties in
Article VIII or by each Credit Party in each of the other Credit Documents to
which it is a party shall be true and correct in all material respects on and as
of the date of the making of such Loan or other extension of credit with the
same force and effect as if made on and as of such date (it being understood and
agreed that any such representation or warranty which by its terms is made as of
an earlier date shall be required to be true and correct in all material
respects only as such earlier date, and that any representation and warranty
that is qualified as to “materiality,” “Material Adverse Effect” or similar
language shall be true and correct in all respects on the applicable date)
(provided that this clause (ii) shall not apply to any extensions of credit
pursuant to an

 

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Incremental Commitment to the extent provided in Section 2.12 and the applicable
Incremental Joinder Agreement).

(b) Notice of Borrowing. Administrative Agent shall have received a Notice of
Borrowing duly completed and complying with Section 4.05. Each Notice of
Borrowing delivered by Borrower hereunder shall constitute a representation and
warranty by Borrower that on and as of the date of such notice and on and as of
the relevant borrowing date (both immediately before and after giving effect to
such borrowing and the application of the proceeds thereof) that the applicable
conditions in Section 7.02 have been satisfied.

ARTICLE VIII.

REPRESENTATIONS AND WARRANTIES

Each Credit Party represents for itself and on behalf of its Restricted
Subsidiaries and warrants to Administrative Agent, Collateral Agent and Lenders
that, at and as of each Funding Date, in each case immediately before and
immediately after giving effect to the transactions to occur on such date
(provided, that such representations and warranties made on the Closing Date
shall be made giving effect to the Transactions and shall be limited to the
Specified Representations):

SECTION 8.01. Corporate Existence; Compliance with Law.

(a) Borrower and each Restricted Subsidiary (i) is a corporation, partnership,
limited liability company or other entity duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization; (ii)(1)
has all requisite corporate or other power and authority, and (2) has all
governmental licenses, authorizations, consents and approvals necessary to own
its Property and carry on its business as now being conducted; and (iii) is
qualified to do business and is in good standing in all jurisdictions in which
the nature of the business conducted by it makes such qualification necessary;
except, in the case of clauses (ii)(2) and (iii) where the failure thereof
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect.

(b) Neither Borrower nor any Restricted Subsidiary nor any of its Property is in
violation of, nor will the continued operation of Borrower’s or such Restricted
Subsidiary’s Property as currently conducted violate, any Requirement of Law
(including, without limitation, Gaming Laws, the Act and any zoning or building
ordinance, code or approval or permits or any restrictions of record or
agreements affecting the Real Property) or is in default with respect to any
judgment, writ, injunction, decree or order of any Governmental Authority, where
such violations or defaults would reasonably be expected to have a Material
Adverse Effect.

(c) Neither Borrower nor any Guarantor is an EEA Financial Institution.

SECTION 8.02. Financial Condition; Etc. Borrower has delivered to Administrative
Agent or made publically available (a) the audited consolidated balance sheets
and related consolidated statements of operations, cash flows and shareholders’
equity of each of Borrower and its Subsidiaries (before giving effect to the
Transactions) and Padre and its Subsidiaries for each of the three most recently
completed fiscal years of Borrower and Padre, respectively, ended at least 90
days before the Closing Date and (b) the unaudited consolidated balance sheets
and related statements of operations and cash flows of each of Borrower and its
Subsidiaries (before giving effect to the Transactions) and Padre and its
Subsidiaries for each fiscal quarter ending after December 31, 2016 (other than
the fourth fiscal quarter of any fiscal year) and at least 45 days prior to the
Closing Date. All of said financial statements,

 

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including in each case the related schedules and notes, are true, complete and
correct in all material respects and have been prepared in accordance with GAAP
consistently applied and present fairly in all material respects the financial
position of Borrower and its Subsidiaries or Padre and its Subsidiaries, as
applicable, as of the respective dates of said balance sheets and the results of
their operations for the respective periods covered thereby, subject (in the
case of interim statements) to normal period-end audit adjustments and the
absence of footnotes.

SECTION 8.03. Litigation. Except as set forth on Schedule 8.03, there is no
Proceeding (other than any normal overseeing reviews of the Gaming Authorities)
pending against, or to the knowledge of any Responsible Officer of Borrower,
threatened in writing against, Borrower or any of the Restricted Subsidiaries or
any of their respective Properties before any Governmental Authority or private
arbitrator that (i) either individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect or (ii) as of the Closing Date only,
challenges the validity or enforceability of any of the Credit Documents.

SECTION 8.04. No Breach; No Default.

(a) None of the execution, delivery and performance by any Credit Party of any
Credit Document to which it is a party nor the consummation of the transactions
herein and therein contemplated (including the Transactions) do or will
(i) conflict with or result in a breach of, or require any consent (which has
not been obtained and is in full force and effect) under (x) any Organizational
Document of any Credit Party or (y) any applicable Requirement of Law
(including, without limitation, any Gaming Law) or (z) any order, writ,
injunction or decree of any Governmental Authority binding on any Credit Party
or tortiously interfere with, result in a breach of, or require termination of,
any term or provision of any Contractual Obligation of any Credit Party or
(ii) constitute (with due notice or lapse of time or both) a default under any
such Contractual Obligation or (iii) result in or require the creation or
imposition of any Lien (except for the Liens created pursuant to the Security
Documents) upon any Property of any Credit Party pursuant to the terms of any
such Contractual Obligation, except with respect to (i)(y), (i)(z), (ii) or
(iii) which would not reasonably be expected to result in a Material Adverse
Effect.

(b) No Default or Event of Default has occurred and is continuing.

SECTION 8.05. Action. Borrower and each Restricted Subsidiary has all necessary
corporate or other organizational power, authority and legal right to execute,
deliver and perform its obligations under each Credit Document to which it is a
party and to consummate the transactions herein and therein contemplated; the
execution, delivery and performance by Borrower and each Restricted Subsidiary
of each Credit Document to which it is a party and the consummation of the
transactions herein and therein contemplated have been duly authorized by all
necessary corporate, partnership or other organizational action on its part; and
this Agreement has been duly and validly executed and delivered by each Credit
Party and constitutes, and each of the Credit Documents to which it is a party
when executed and delivered by such Credit Party will constitute, its legal,
valid and binding obligation, enforceable against each Credit Party, as
applicable, in accordance with its terms, except as such enforceability may be
limited by (a) bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or similar laws of general applicability from time to time in effect
affecting the enforcement of creditors’ rights and remedies and (b) the
application of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

SECTION 8.06. Approvals. No authorizations, approvals or consents of, and no
filings or registrations with, any Governmental Authority or any securities
exchange are necessary for the execution, delivery or performance by Borrower or
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which it is a party or for the legality, validity or enforceability hereof or
thereof or for the consummation of the Transactions (including the consummation
of the Padre Acquisition), except for: (i) authorizations, approvals or consents
of, and filings or registrations with any Governmental Authority or any
securities exchange previously obtained, made, received or issued, (ii) filings
and recordings in respect of the Liens created pursuant to the Security
Documents, (iii) the filings referred to in Section 8.14, (iv) waiver by the
Gaming Authorities of any qualification requirement on the part of the Lenders
who do not otherwise qualify and are not banks or licensed lending institutions,
(v) consents, authorizations and filings that have been obtained or made and are
in full force and effect or the failure of which to obtain would not reasonably
be expected to have a Material Adverse Effect, (vi) any required approvals
(including prior approvals) of the requisite Gaming Authorities that any Agent,
Lender or participant is required to obtain from, or any required filings with,
requisite Gaming Authorities to exercise their respective rights and remedies
under this Agreement and the other Credit Documents (as set forth in
Section 13.13), (vii) prior approval from the landlord and other Governmental
Authorities for the provision of a leasehold Mortgage encumbering the Rocky Gap
Property (viii) prior approval from the Nevada Gaming Commission of the Security
Agreement and the pledge of any Pledged Nevada Gaming Interests (as defined in
the Security Agreement) and (ix) prior approval from the Montana Gambling
Control Division of the Security Agreement and the pledge of any Pledged Montana
Gaming Interests (as defined in the Security Agreement).

SECTION 8.07. ERISA, Foreign Employee Benefit Matters and Labor Matters.

(a) No ERISA Event has occurred or is reasonably expected to occur that, when
taken together with all other such ERISA Events for which liability is
reasonably expected to occur, would reasonably be expected to result in a
Material Adverse Effect. Except as set forth on Schedule 8.07, as of the Closing
Date, no ERISA Entity maintains or contributes to any Pension Plan. Each Company
is in compliance with the presently applicable provisions of ERISA and the Code
with respect to each Employee Benefit Plan (other than to the extent such
failure to comply would not reasonably be expected to have a Material Adverse
Effect). Using actuarial assumptions and computation methods consistent with
Part I of Subtitle E of Title IV of ERISA, the aggregate liabilities of any
ERISA Entity to all Multiemployer Plans in the event of a complete withdrawal
therefrom, as of the close of the most recent fiscal year of each such
Multiemployer Plan that precedes the Closing Date, would not reasonably be
expected to result in a Material Adverse Effect.

(b) Each Foreign Plan is in compliance with all laws, regulations and rules
applicable thereto and the respective requirements of the governing documents
for such Foreign Plan (other than to the extent such failure to comply would not
reasonably be expected to have a Material Adverse Effect). The aggregate of the
liabilities to provide all of the accrued benefits under any funded Foreign Plan
(based on reasonable assumptions used by such Foreign Plan) does not as of the
most recent valuation report (or as of the end of the most recent plan year if
there is no recent valuation report) exceed the current fair market value of the
assets held in the trust or other funding vehicle for such Foreign Plan by an
amount that would reasonably be expected to have a Material Adverse Effect.
Other than to the extent such failure to comply would not reasonably be expected
to have a Material Adverse Effect, with respect to any unfunded Foreign Plan,
reasonable reserves have been established in accordance with prudent business
practice or where required by ordinary accounting practices in the jurisdiction
in which such Foreign Plan is maintained. There are no actions, suits or claims
(other than routine claims for benefits) pending or to the knowledge of any
Responsible Officer of Borrower, threatened against Borrower or any of its
Restricted Subsidiaries or any ERISA Entity with respect to any Foreign Plan
that would reasonably be expected to result in a Material Adverse Effect.

 

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(c) Except as, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect, (i) there are no strikes or other
labor disputes against Borrower or any of its Restricted Subsidiaries pending
or, to the knowledge of Borrower, threatened and (ii) the hours worked by and
payments made to employees of Borrower or any of its Restricted Subsidiaries
have not been in violation of the Fair Labor Standards Act or any other
applicable loan dealing with such matters.

SECTION 8.08. Taxes. Except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect, (i) all tax returns,
statements, reports and forms or other documents (including estimated Tax or
information returns and including any required, related or supporting
information) (collectively, the “Tax Returns”) required to be filed with any
taxing authority by, or with respect to, Borrower and each of the Restricted
Subsidiaries have been timely filed in accordance with all applicable Laws;
(ii) Borrower and each of the Restricted Subsidiaries has timely paid all Taxes
shown as due and payable on Tax Returns that have been so filed or that are
otherwise due and payable (including in its capacity as a withholding agent) and
other than Taxes which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in accordance
with GAAP and such proceedings operate to suspend collection of the contested
Taxes and enforcement of a Lien in respect thereof) and each Tax Return is
accurate and complete; and (iii) Borrower and each of the Restricted
Subsidiaries has made adequate provision in accordance with GAAP for all Taxes
payable by Borrower or such Restricted Subsidiary for which no Tax Return has
yet been filed. Neither Borrower nor any of the Restricted Subsidiaries has
received written notice of any proposed or pending Tax assessment, audit or
deficiency against Borrower or such Restricted Subsidiary that would,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

SECTION 8.09. Investment Company Act. Neither Borrower nor any of the Restricted
Subsidiaries is an “investment company,” or a company “controlled” by an
“investment company” required to be regulated under the Investment Company Act
of 1940, as amended.

SECTION 8.10. Environmental Matters. Except as set forth on Schedule 8.10 or as
would not, individually or in the aggregate, reasonably be expected to result in
a Material Adverse Effect: (i) each of Borrower and the Restricted Subsidiaries
and each of their businesses, operations and Real Property is in compliance
with, and each has no liability under any Environmental Law; (ii) each of
Borrower and the Restricted Subsidiaries has obtained all Permits required for,
the conduct of their businesses and operations, and the ownership, operation and
use of their assets, all as currently conducted, under any Environmental Law,
all such Permits are valid and in good standing and, under the currently
effective business plans of Borrower and the Restricted Subsidiaries, no
expenditures or operational adjustments would reasonably be expected to be
required during the next five years in order to renew or modify such Permits;
(iii) there has been no Release or threatened Release of Hazardous Material on,
at, under or from any real property or facility presently or formerly owned,
leased, operated or, to the knowledge of any Responsible Officer of Borrower or
any of the Restricted Subsidiaries, used for waste disposal by Borrower or any
of the Restricted Subsidiaries, or any of their respective predecessors in
interest that would reasonably be expected to result in liability to Borrower or
any of the Restricted Subsidiaries under any Environmental Law; (iv) there is no
Environmental Action pending or, to the knowledge of any Responsible Officer of
Borrower or any of the Restricted Subsidiaries, threatened, against Borrower or
any of the Restricted Subsidiaries or, relating to real property currently or
formerly owned, leased, operated or, to the knowledge of any Responsible Officer
of Borrower or any of the Restricted Subsidiaries, used for waste disposal, by
Borrower or any of the Restricted Subsidiaries or relating to the operations of
Borrower or the Restricted Subsidiaries; (v) none of Borrower or any of the
Restricted Subsidiaries is obligated to perform any action or otherwise incur
any expense under any Environmental Law pursuant to any legally binding order,
decree, judgment or agreement by which it is bound or has assumed by contract or
agreement, and none of Borrower or any of the Restricted

 

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Subsidiaries is conducting or financing any Response Action pursuant to any
Environmental Law with respect to any location; (vi) no circumstances exist that
would reasonably be expected to (a) form the basis of an Environmental Action
against Borrower or any of the Restricted Subsidiaries, or any of their Real
Property, facilities or assets or (b) cause any such Real Property, facilities
or assets to be subject to any restriction on ownership, occupancy, use or
transferability under any Environmental Law; (vii) no real property or facility
presently or formerly owned, operated or leased by Borrower or any of the
Restricted Subsidiaries and, to the knowledge of any Responsible Officer of
Borrower or any of the Restricted Subsidiaries, no real property or facility
presently or formerly used for waste disposal by Borrower or any of the
Restricted Subsidiaries or owned, leased, operated or used for waste disposal by
any of their respective predecessors in interest is (a) listed or proposed for
listing on the National Priorities List promulgated pursuant to CERCLA or
(b) included on any similar list maintained by any Governmental Authority
including, without limitation, any such list relating to petroleum; (viii) no
real property or facility presently or formerly owned, or presently leased or
operated by Borrower or any of the Restricted Subsidiaries and, to the knowledge
of any Responsible Officer of Borrower or any of the Restricted Subsidiaries, no
real property or facility formerly leased or operated by Borrower or any of the
Restricted Subsidiaries is listed on the Comprehensive Environmental Response,
Compensation, and Liability Information System promulgated pursuant to CERCLA as
potentially requiring future Response Action; (ix) no Lien has been recorded or,
to the knowledge of any Responsible Officer of Borrower or any of the Restricted
Subsidiaries, threatened under any Environmental Law with respect to any Real
Property or other assets of Borrower or any of the Restricted Subsidiaries; and
(x) the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not affect the
validity or require the transfer of any Permit held by Borrower or any of the
Restricted Subsidiaries under any Environmental Law, and will not require any
notification, registration, filing, reporting, disclosure, investigation,
remediation or cleanup pursuant to any Governmental Real Property Disclosure
Requirements with respect to each of Borrower and the Restricted Subsidiaries or
any of their respective predecessors in interest.

SECTION 8.11. Use of Proceeds.

(a) Borrower will use the proceeds of:

(i) Term B Facility Loans on the Closing Date to finance a portion of the
Transactions and for general corporate purposes; and

(ii) Term Loans made after the Closing Date for working capital, capital
expenditures, Permitted Acquisitions (and other Acquisitions not prohibited
hereunder) and general corporate purposes and for any other purposes not
prohibited by this Agreement.

(b) Neither Borrower nor any of the Restricted Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose, whether immediate, incidental or ultimate, of buying or
carrying Margin Stock. No part of the proceeds of any extension of credit
(including any Loans) hereunder will be used directly or indirectly and whether
immediately, incidentally or ultimately to purchase or carry any Margin Stock or
to extend credit to others for such purpose or to refund Indebtedness originally
incurred for such purpose or for any other purpose, in each case, that entails a
violation of, or is inconsistent with, the provisions of Regulation T,
Regulation U or Regulation X. The pledge of any Equity Interests by any Credit
Party pursuant to the Security Agreement does not violate such regulations.

 

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SECTION 8.12. Subsidiaries.

(a) Schedule 8.12(a) sets forth a true and complete list of the following:
(i) all the Subsidiaries of Borrower as of the Closing Date; (ii) the name and
jurisdiction of incorporation or organization of each such Subsidiary as of the
Closing Date; and (iii) as to each such Subsidiary, the percentage and number of
each class of Equity Interests of such Subsidiary owned by Borrower and its
respective Subsidiaries as of the Closing Date.

(b) Schedule 8.12(b) sets forth a true and complete list of all the Immaterial
Subsidiaries as of the Closing Date.

(c) Schedule 8.12(c) sets forth a true and complete list of all the Unrestricted
Subsidiaries as of the Closing Date.

SECTION 8.13. Ownership of Property; Liens. Except as set forth on Schedule
8.13(a), (a) Borrower and each of the Restricted Subsidiaries has good and valid
title to, or a valid (with respect to Real Property and Vessels) leasehold
interest in (or subleasehold interest in or other right to occupy), all material
assets and Property (including Mortgaged Real Property and Mortgaged Vessels)
(tangible and intangible) owned or occupied by it (except insofar as
marketability may be limited by any laws or regulations of any Governmental
Authority affecting such assets), and (b) all such assets and Property are
subject to no Liens other than Permitted Liens. All of the assets and Property
owned by, leased to or used by Borrower and each of the Restricted Subsidiaries
in its respective businesses are in good operating condition and repair in all
material respects (ordinary wear and tear and casualty and force majeure
excepted) except in each case where the failure of such asset to meet such
requirements would not reasonably be expected to result in a Material Adverse
Effect.

SECTION 8.14. Security Interest; Absence of Financing Statements; Etc.

(a) Subject to applicable Gaming Laws, the Security Documents, once executed and
delivered, will create, in favor of Collateral Agent for the benefit of the
Secured Parties, as security for the Obligations, a valid and enforceable
security interest in and Lien upon all of the Collateral (subject to any
applicable provisions set forth herein or in the Security Documents with respect
to limitations or exclusions from the requirement to perfect the security
interests and Liens on the collateral described therein), and upon (i) filing of
financing statements in the offices of the Secretaries of State of each Credit
Party’s jurisdiction of organization or formation or recording, registering or
taking such other actions as may be necessary with the appropriate Governmental
Authorities (including payment of applicable filing and recording taxes) and
(ii) the taking of possession or control by Collateral Agent of the Pledged
Collateral (or, prior to the Discharge of Senior Obligations (as defined in the
First Lien/Second Lien Intercreditor Agreement), by the Senior Representative
(as defined in the First Lien/Second Lien Intercreditor Agreement) in accordance
with the First Lien/Second Lien Intercreditor Agreement) with respect to which a
security interest may be perfected only by possession or control which
possession or control shall be given to Collateral Agent (or, prior to the
Discharge of Senior Obligations (as defined in the First Lien/Second Lien
Intercreditor Agreement), to the Senior Representative (as defined in the First
Lien/Second Lien Intercreditor Agreement) in accordance with the First
Lien/Second Lien Intercreditor Agreement) to the extent possession or control by
Collateral Agent is required by the Security Agreement, such security interest
shall be a perfected security interest in and Lien upon all of the Collateral
(subject to any applicable provisions set forth herein or in the Security
Documents with respect to limitations or exclusions from the requirement to
perfect the security interests and Liens on the collateral described therein)
superior to and prior to the rights of all third Persons and subject to no Liens
other than Permitted Liens.

 

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(b) Each Ship Mortgage, once executed and delivered, will create, upon filing
and recording in the National Vessel Documentation Center of the United States
Coast Guard, in favor of Collateral Agent for the benefit of the Secured Parties
a legal, valid and enforceable preferred mortgage upon the applicable Mortgaged
Vessel under Chapter 313 of Title 46 of the United States Code, subject to no
Liens other than Permitted Liens.

Notwithstanding anything herein (including this Section 8.14) or in any other
Credit Document to the contrary, neither Borrower nor any other Credit Party
makes any representation or warranty as to (A) the effects of perfection or
non-perfection, the priority or the enforceability of any pledge of or security
interest in any Equity Interests of any Foreign Subsidiary, or as to the rights
and remedies of the Agents or any Lender with respect thereto, under foreign Law
or (B) the pledge or creation of any security interest, or the effects of
perfection or non-perfection, the priority or the enforceability of any pledge
of or security interest to the extent such pledge, security interest, perfection
or priority is not required pursuant to this Agreement or any other Credit
Document.

SECTION 8.15. Licenses and Permits. Except as set forth on Schedule 8.15,
Borrower and each of its Restricted Subsidiaries hold all material governmental
permits, licenses, authorizations, consents and approvals (including Gaming
Approvals) necessary for Borrower and its Restricted Subsidiaries to own, lease,
and operate their respective Properties and to operate their respective
businesses as now being conducted (collectively, the “Permits”), except for
Permits the failure of which to obtain would not reasonably be expected to have
a Material Adverse Effect. None of the Permits has been modified in any way
since the Closing Date that would reasonably be expected to have a Material
Adverse Effect. Except as set forth on Schedule 8.15, all Permits are in full
force and effect except where the failure to be in full force and effect would
not reasonably be expected to have a Material Adverse Effect. Except as set
forth on Schedule 8.15, neither Borrower nor any of its Restricted Subsidiaries
has received written notice that any Gaming Authority has commenced proceedings
to suspend, revoke or not renew any such Permits where such suspensions,
revocations or failure to renew would reasonably be expected to have a Material
Adverse Effect.

SECTION 8.16. Disclosure. The information, reports, financial statements,
exhibits and schedules furnished in writing by or on behalf of any Credit Party
to any Secured Party prior to the Closing Date in connection with this Agreement
and the other Credit Documents, but in each case excluding all projections and
general industry or economic data, when taken as a whole and giving effect to
all supplements and updates, do not contain any untrue statement of material
fact or omit to state a material fact necessary in order to make the statements
herein or therein, in light of the circumstances under which they were made, not
materially misleading. The pro forma financial information furnished pursuant to
Section 7.01(i)(iii) was prepared in good faith based on assumptions believed by
Borrower to be reasonable at the time made, it being recognized by the Lenders
that such financial information as it relates to future events is not to be
viewed as fact and that actual results during the period or periods covered by
such financial information may differ from the projected results set forth
therein by a material amount and no Credit Party, however, makes any
representation as to the ability of any Company to achieve the results set forth
in any such projections.

SECTION 8.17. Solvency. As of the Closing Date, immediately prior to and
immediately following the consummation of the Transactions occurring on the
Closing Date, Borrower (on a consolidated basis with its Restricted
Subsidiaries) is and will be Solvent (after giving effect to Section 6.07).

SECTION 8.18. Senior Obligations. The Obligations are “Senior Debt,” “Senior
Indebtedness,” or “Senior Secured Financing” (or any comparable term) under, and
as defined in, and

 

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entitled to the subordination and/or intercreditor, as applicable, provisions of
any Permitted Unsecured Refinancing Debt and Ratio Debt that is purported to be
subordinated to the Obligations.

SECTION 8.19. Intellectual Property. Except as set forth on Schedule 8.19,
Borrower and each of its Restricted Subsidiaries owns or possesses adequate
licenses or otherwise has the right to use all of the patents, patent
applications, trademarks, trademark applications, service marks, service mark
applications, trade names, copyrights, trade secrets, know-how and processes
(collectively, “Intellectual Property”) (including, as of the Closing Date, all
Intellectual Property listed in Schedules 8(a), 8(b) and 8(c) to the Initial
Perfection Certificate) that are necessary for the operation of its business as
presently conducted except where failure to own or have such right would not
reasonably be expected to have a Material Adverse Effect and, as of the Closing
Date, all registrations listed in Schedules 8(a), 8(b) and 8(c) to the Initial
Perfection Certificate are valid and in full force and effect, except where the
invalidity of such registrations would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. Except as set forth on
Schedule 8.19, as of the Closing Date, no claim is pending or, to the knowledge
of any Responsible Officer of Borrower, threatened to the effect that Borrower
or any of its Restricted Subsidiaries infringes or conflicts with the asserted
rights of any other Person under any material Intellectual Property, except for
such claims that would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Except as set forth on Schedule
8.19, as of the Closing Date, no claim is pending or, to the knowledge of any
Responsible Officer of Borrower, threatened to the effect that any such material
Intellectual Property owned or licensed by Borrower or any of its Restricted
Subsidiaries or which Borrower or any of its Restricted Subsidiaries otherwise
has the right to use is invalid or unenforceable, except for such claims that
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

SECTION 8.20. [Reserved].

SECTION 8.21. [Reserved].

SECTION 8.22. Insurance. Borrower and each of its Restricted Subsidiaries are
insured by insurers of recognized financial responsibility (determined as of the
date such insurance was obtained) against such losses and risks (other than wind
and flood damage) and in such amounts as are prudent and customary in the
businesses in which it is engaged, except to the extent that such insurance is
not available on commercially reasonable terms. Borrower and each of its
Restricted Subsidiaries maintain all insurance required by Flood Insurance Laws
(but shall not, for the avoidance of doubt, be required to obtain insurance with
respect to wind and flood damage unless and to the extent required by such Flood
Insurance Laws).

SECTION 8.23. Real Estate.

(a) Schedule 8.23(a) sets forth a true, complete and correct list of all
Material Real Property owned and all Material Real Property leased by Borrower
or any of its Restricted Subsidiaries as of the Closing Date, including a brief
description thereof, including, in the case of leases, the street address (to
the extent available) and landlord name. Borrower has delivered to Collateral
Agent true, complete and correct copies of all such leases.

(b) Except as set forth on Schedule 8.23(b), as of the Closing Date, to the best
of knowledge of any Responsible Officer of Borrower no Taking has been commenced
or is contemplated with respect to all or any portion of the Material Real
Property or for the relocation of roadways providing access to such Material
Real Property that either individually or in the aggregate would reasonably be
expected to have a Material Adverse Effect.

 

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SECTION 8.24. Leases.

(a) [Reserved].

(b) Borrower and its Restricted Subsidiaries have paid all material payments
required to be made by it under all leases of Material Real Property where any
of the Collateral is or may be located from time to time (other than any amount
the validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of Borrower or such Restricted Subsidiary, as the case may
be, and any amounts that are due but not yet delinquent), except where failure
to make such payments would not reasonably be expected to have a Material
Adverse Effect.

(c) As of the Closing Date and thereafter, each of the material leases of
Material Real Property is in full force and effect and will be or is, as
applicable, legal, valid, binding and enforceable against the Credit Party party
thereto, in accordance with its terms, in each case, except as such
enforceability may be limited by (x) bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or similar laws of general applicability
from time to time in effect affecting the enforcement of creditors’ rights and
remedies and (y) the application of general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law),
except as would not reasonably be expected to have a Material Adverse Effect.

(d) None of the leases of Material Real Property have been amended, modified or
assigned in any manner that would reasonably be expected to result in a Material
Adverse Effect. Borrower has not received written notice of any existing breach,
default, event of default or, to the best of knowledge of any Responsible
Officer of Borrower, event that, with or without notice or lapse of time or
both, would constitute a breach, default or an event of default by any Credit
Party party to any of the leases of Material Real Property that would reasonably
be expected to have a Material Adverse Effect.

SECTION 8.25. Mortgaged Real Property. Except as set forth on Schedule 8.25(a)
or as would not reasonably be expected to have a Material Adverse Effect, with
respect to each Mortgaged Real Property, as of the Closing Date (a) there has
been issued a valid and proper certificate of occupancy or other local
equivalent, if any, for the use then being made of such Mortgaged Real Property
to the extent required by applicable Requirements of Law and there is no
outstanding citation, notice of violation or similar notice indicating that the
Mortgaged Real Property contains conditions which are not in compliance with
local codes or ordinances relating to building or fire safety or structural
soundness and (b) except as set forth on Schedule 8.25(b), there are no material
disputes regarding boundary lines, location, encroachment or possession of such
Mortgaged Real Property and no Responsible Officer of Borrower has actual
knowledge of any state of facts existing which could give rise to any such claim
other than those that would not reasonably be expected to have a Material
Adverse Effect; provided, however, that with respect to any Mortgaged Real
Property in which Borrower or a Restricted Subsidiary has a leasehold estate,
the foregoing certifications shall be to Borrower’s knowledge only.

SECTION 8.26. Material Adverse Effect. Since the Closing Date, there shall not
have occurred any event or circumstance that has had or would reasonably be
expected to have, either individually or in the aggregate, a Material Adverse
Effect.

SECTION 8.27. Anti-Corruption Laws and Sanctions. Borrower has implemented and
maintains in effect policies and procedures reasonably designed to promote
material compliance by Borrower, its Subsidiaries and their respective
directors, officers, employees and agents with Anti-Corruption Laws and
applicable Sanctions, and Borrower, its Subsidiaries and, to the knowledge of

 

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Borrower or its Subsidiaries, their respective officers, directors and
employees, are in compliance with Anti-Corruption Laws and applicable Sanctions
in all material respects and are not knowingly engaged in any activity that
would reasonably be expected to result in Borrower or its Subsidiaries being
designated as a Sanctioned Person. None of (a) Borrower, any Subsidiary or, to
the knowledge of Borrower or such Subsidiary, any of their respective directors,
officers or employees, or (b) to the knowledge of Borrower, any agent of
Borrower or any of its Subsidiaries that will act in any capacity in connection
with or benefit from the credit facility established hereby, is a Sanctioned
Person. No Borrowing, use of proceeds or other transaction contemplated by this
Agreement will violate any Anti-Corruption Law or applicable Sanctions.

ARTICLE IX.

AFFIRMATIVE COVENANTS

Each Credit Party, for itself and on behalf of its Restricted Subsidiaries,
covenants and agrees with Administrative Agent, Collateral Agent and Lenders
that until the Obligations have been Paid in Full (and each Credit Party
covenants and agrees that it will cause its Restricted Subsidiaries to observe
and perform the covenants herein set forth applicable to any such Restricted
Subsidiary until the Obligations have been Paid in Full):

SECTION 9.01. Existence; Business Properties.

(a) Borrower and each of its Restricted Subsidiaries shall do or cause to be
done all things necessary to preserve, renew and keep in full force and effect
its legal existence (in the case of Borrower, in the United States), except in a
transaction permitted by Section 10.05 or, in the case of any Restricted
Subsidiary, where the failure to perform such obligations, individually or in
the aggregate, would not reasonably be expected to result in a Material Adverse
Effect.

(b) Borrower and each of its Restricted Subsidiaries shall do or cause to be
done all things necessary to obtain, preserve, renew, extend and keep in full
force and effect the rights, licenses, permits, franchises, authorizations,
approvals, patents, copyrights, trademarks and trade names (including Gaming
Approvals) material to the conduct of its business except where the failure to
do so, individually or in the aggregate, would not reasonably be expected to
result in a Material Adverse Effect; comply with all applicable Requirements of
Law (including any and all Gaming Laws and any and all zoning, building,
ordinance, code or approval or any building permits or any restrictions of
record or agreements affecting the Real Property) and decrees and orders of any
Governmental Authority, whether now in effect or hereafter enacted, except where
the failure to comply, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect and at all times maintain and
preserve all of its property and keep such property in good repair, working
order and condition (ordinary wear and tear and casualty and force majeure
excepted) except where the failure to do so individually or in the aggregate
would not reasonably be expected to result in a Material Adverse Effect;
provided, however, that nothing in this Section 9.01(b) shall prevent (i) sales,
conveyances, transfers or other dispositions of assets, consolidations or
mergers by or involving any Company or any other transaction in accordance with
Section 10.05; (ii) the withdrawal by any Company of its qualification as a
foreign corporation in any jurisdiction where such withdrawal, individually or
in the aggregate, would not reasonably be expected to result in a Material
Adverse Effect; or (iii) the abandonment by any Company of any rights, Permits,
authorizations, copyrights, trademarks, trade names, franchises, licenses and
patents that such Company reasonably determines are not useful to its business.

 

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(c) Borrower will maintain in effect and enforce policies and procedures
reasonably designed to promote material compliance by Borrower, its Subsidiaries
and their respective directors, officers, employees and agents with
Anti-Corruption Laws and applicable Sanctions.

SECTION 9.02. Insurance.

(a) Borrower and its Restricted Subsidiaries shall maintain with insurers of
recognized financial responsibility (determined at the time such insurance is
obtained) not Affiliates of Borrower insurance on its Property in at least such
amounts and against at least such risks as are customarily insured against by
companies engaged in the same or a similar business and operating similar
properties in localities where Borrower or the applicable Restricted Subsidiary
operates; and furnish to Administrative Agent, upon written request, information
as to the insurance carried; provided that Borrower and its Restricted
Subsidiaries shall not be required to maintain insurance with respect to wind
and flood damage on any property for any insurance coverage period unless, and
to the extent, such insurance is required by an applicable Requirement of Law.
Subject to Section 9.15, Collateral Agent shall be named as an additional
insured on all third-party liability insurance policies of Borrower and each of
its Restricted Subsidiaries (other than directors and officers liability
insurance, insurance policies relating to employment practices liability, crime
or fiduciary duties, kidnap and ransom insurance policies, and insurance as to
fraud, errors and omissions), and Collateral Agent shall be named as
mortgagee/loss payee on all property insurance policies of each such Person.

(b) Borrower and each of its Restricted Subsidiaries shall deliver to
Administrative Agent on behalf of the Secured Parties, (i) on or prior to the
Closing Date, a certificate dated on or prior (but close) to the Closing Date
showing the amount and types of insurance coverage as of such date,
(ii) promptly following receipt of any notice from any insurer of cancellation
of a material policy or material change in coverage from that existing on the
Closing Date, a copy of such notice (or, if no copy is available, notice
thereof), and (iii) promptly after such information has been received in written
form by Borrower or any of its Restricted Subsidiaries, information as to any
claim for an amount in excess of $30.0 million with respect to any property and
casualty insurance policy maintained by Borrower or any of its Restricted
Subsidiaries.

(c) If any portion of any Mortgaged Real Property is at any time located in an
area identified by the Federal Emergency Management Agency (or any successor
agency) as a special flood hazard area with respect to which flood insurance has
been made available under the Flood Insurance Laws, then Borrower shall, or
shall cause the applicable Credit Party to (i) to the extent required pursuant
to the Flood Insurance Laws, maintain, or cause to be maintained, with a
financially sound and reputable insurer (determined at the time such insurance
is obtained), flood insurance in an amount and otherwise sufficient to comply
with all applicable rules and regulations promulgated pursuant to such Flood
Insurance Laws and (ii) deliver to Administrative Agent evidence of such
compliance in form and substance reasonably acceptable to Administrative Agent.

(d) In the event that the proceeds of any insurance claim are paid after
Collateral Agent has exercised its right to foreclose after an Event of Default,
such proceeds shall be paid to Collateral Agent to satisfy any deficiency
remaining after such foreclosure. Collateral Agent shall retain its interest in
the policies required to be maintained pursuant to this Section 9.02 during any
redemption period.

SECTION 9.03. Taxes; Performance of Obligations.

Borrower and each of its Restricted Subsidiaries shall timely file all material
Tax Returns required to be filed by it and pay and discharge promptly when due
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governmental charges or levies imposed upon it or upon its income or profits or
in respect of its property (including in its capacity as a withholding agent),
before the same shall become delinquent or in default; provided, however, that
such payment and discharge shall not be required with respect to any such Tax,
assessment, charge, levy or claim so long as the validity or amount thereof
shall be contested in good faith by appropriate proceedings and Borrower and
each of its Subsidiaries shall have set aside on its books adequate reserves
with respect thereto in accordance with GAAP and such contest operates to
suspend collection of the contested obligation, Tax, assessment or charge and,
in the case of Liens on the Collateral, enforcement of such Lien.

SECTION 9.04. Financial Statements, Etc. Borrower shall deliver to
Administrative Agent for distribution by Administrative Agent to the Lenders
(unless a Lender expressly declines in writing to accept):

(a) Quarterly Financials. As soon as available, but in any event within
forty-five (45) days (or sixty (60) days in the case of the first such delivery)
after the end of each fiscal quarter of Borrower beginning with the fiscal
quarter ended March 31, 2018 (other than the last fiscal quarter in any fiscal
year), (x) a consolidated balance sheet of Borrower and its Subsidiaries as at
the end of such fiscal quarter, and the related (i) consolidated statements of
income or operations for such fiscal quarter and for the portion of the fiscal
year then ended and (ii) consolidated statements of cash flows for such fiscal
quarter and the portion of the fiscal year then ended, setting forth in each
case in comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail and certified by a Responsible Officer of Borrower as
fairly presenting in all material respects the financial condition, results of
operations and cash flows of Borrower and its Subsidiaries in accordance with
GAAP, subject only to normal year-end audit adjustments and the absence of
footnotes and (y) management’s discussion and analysis of the important
operational and financial developments of Borrower and the Subsidiaries during
such fiscal quarter;

(b) Annual Financials. As soon as available, but in any event within ninety
(90) days (or one hundred twenty (120) days in the case of the fiscal year ended
December 31, 2017) after the end of each fiscal year of Borrower beginning with
the fiscal year ended December 31, 2017, (x) consolidated balance sheets of
Borrower and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, shareholders’ equity and cash
flows for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year and, in the case of each such consolidated
financial statements, audited and accompanied by a report and opinion of either
Piercy Bowler Taylor & Kern, Grant Thornton or any other independent registered
public accounting firm of nationally recognized standing, which report and
opinion shall be prepared in accordance with generally accepted auditing
standards and shall not be subject to any “going concern” or like qualification
or exception or any qualification or exception as to the scope of such audit,
other than resulting from (I) an upcoming maturity date within twelve
(12) months under any Indebtedness, or (II) any prospective or actual default of
any financial covenant with respect to the credit facilities hereunder or any
other Indebtedness, and (y) management’s discussion and analysis of the
important operational and financial developments of Borrower and the
Subsidiaries during such fiscal year;

(c) Auditor’s Certificates; Compliance Certificate. At the time it furnishes
each set of financial statements pursuant to Section 9.04(a) or Section 9.04(b),
a certificate of a Responsible Officer of Borrower in the form of Exhibit V
hereto to the effect that no Default has occurred and is continuing (or, if any
Default has occurred and is continuing, describing the same in reasonable detail
and describing the action that the Companies have taken and propose to take with
respect thereto);

 

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(d) Notice of Default. Promptly after any Responsible Officer of any Company
knows that any Default has occurred, a notice of such Default, breach or
violation describing the same in reasonable detail and a description of the
action that the Companies have taken and propose to take with respect thereto;

(e) Environmental Matters. Written notice of any claim, release of Hazardous
Material, condition, circumstance, occurrence or event arising under
Environmental Law which would reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect;

(f) Annual Budgets. As soon as available, and in any event no later than ninety
(90) days after the end of each fiscal year of Borrower (or one hundred twenty
(120) days in the case of the fiscal year ended December 31, 2017), a detailed
consolidated budget for the following fiscal year (including a projected
consolidated balance sheet of Borrower and its Subsidiaries as of the end of
each fiscal quarter of such fiscal year, the related consolidated statements of
projected cash flow and projected income and a summary of the material
underlying assumptions applicable thereto), which shall be accompanied by a
certificate of a Responsible Officer stating that such projections are based on
reasonable estimates, information and assumptions and that such Responsible
Officer has no reason to believe that such projections are incorrect or
misleading in any material respect;

(g) Auditors’ Reports. Promptly upon receipt thereof, copies of all annual,
interim or special reports issued to Borrower or any Restricted Subsidiary by
independent certified public accountants in connection with each annual, interim
or special audit of Borrower’s or such Restricted Subsidiary’s books made by
such accountants, including any management letter commenting on Borrower’s or
such Restricted Subsidiary’s internal controls issued by such accountants to
management in connection with their annual audit; provided, however, that such
reports shall only be made available to Administrative Agent and to those
Lenders who request such reports through Administrative Agent;

(h) Lien Matters; Casualty and Damage to Collateral.

(i) Prompt written notice of (i) the incurrence of any Lien (other than a
Permitted Lien) on the Collateral or any part thereof, (ii) any Casualty Event
or other insured damage to any material portion of the Collateral or (iii) the
occurrence of any other event that in Borrower’s judgment is reasonably likely
to materially adversely affect the aggregate value of the Collateral; and

(ii) Each year, at the time of delivery of annual financial statements with
respect to the preceding fiscal year pursuant to Section 9.04(b), a certificate
of a Responsible Officer of Borrower setting forth the information required
pursuant to Schedules 1(a), 1(b), 2, 3(a), 3(b), 4, 5, 6, 7, 8(a), 8(b), 8(c),
9, 10, and 11 to the Perfection Certificate or confirming that there has been no
change in such information since the date of the Initial Perfection Certificate
or the date of the most recent certificate delivered pursuant to this
Section 9.04(h)(ii);

(i) Notice of Material Adverse Effect. Written notice of the occurrence of any
event or occurrence that has had or would reasonably be expected to have a
Material Adverse Effect;

(j) ERISA Information. Promptly after the occurrence of any ERISA Event that,
alone or together with any other ERISA Events that have occurred, would
reasonably be expected to result in a Material Adverse Effect, a written notice
specifying the nature thereof, what action the Companies or other ERISA Entity
have taken, are taking or propose to take with respect thereto, and, when known,
any

 

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action taken or threatened by the IRS, Department of Labor, PBGC or
Multiemployer Plan sponsor with respect thereto;

(k) Litigation. Promptly after Borrower’s knowledge thereof, notice of the
filing or commencement of any action, suit, litigation or proceeding, whether at
law or in equity by or before any Governmental Authority against Borrower or any
of its Restricted Subsidiaries thereof that would reasonably be expected to
result in a Material Adverse Effect;

(l) Lender Calls. Commencing with the fiscal year ending December 31, 2017,
following delivery (or, if later, required delivery) of the annual financial
statements pursuant to Section 9.04(b), to the extent reasonably requested by
Administrative Agent, Borrower will host a conference call, at a time to be
mutually agreed between Borrower and Administrative Agent, with the Lenders to
review the financial information presented therein (provided that the
requirement of this call may be satisfied by Borrower’s hosting of its annual
earnings call for investors).

(m) Patriot Act. Promptly following Administrative Agent’s or any Lender’s
request therefor, all documentation and other information that Administrative
Agent or such Lender reasonably requests in order to comply with its ongoing
obligations under the applicable “know your customer” and anti-money laundering
rules and regulations, including the Patriot Act; and

(n) Miscellaneous. Promptly, such financial information, reports, documents and
other information with respect to Borrower or any of its Restricted Subsidiaries
as Administrative Agent or the Required Lenders may from time to time reasonably
request; provided that, notwithstanding the foregoing, nothing in this
Section 9.04 shall require delivery of financial information, reports, documents
or other information which constitutes attorney work product or is subject to
confidentiality agreements or to the extent disclosure thereof would reasonably
be expected to result in loss of attorney client privilege with respect thereto.

Notwithstanding the foregoing, the obligations in Section 9.04(a) and 9.04(b)
may be satisfied with respect to financial information of Borrower and the
Subsidiaries by furnishing Borrower’s Form 10-K or 10-Q, as applicable, filed
with the SEC; provided that in the case of Section 9.04(b), such Form 10-K is
furnished together with an auditor’s report and opinion satisfying the
requirements of Section 9.04(b).

Concurrently with the delivery of Section 9.04 Financials, in the event that, in
the aggregate, the Unrestricted Subsidiaries account for greater than 5.0% of
the Consolidated EBITDA of Borrower and its Subsidiaries on a consolidated basis
with respect to the Test Period ended on the last day of the period covered by
such financial statements, Borrower shall provide revenues, net income,
Consolidated EBITDA (including the component parts thereof), Consolidated Net
Indebtedness and cash and Cash Equivalents on hand of (x) Borrower and its
Restricted Subsidiaries, on the one hand, and (y) the Unrestricted Subsidiaries,
on the other hand (with Consolidated EBITDA to be determined for such
Unrestricted Subsidiaries as if references in the definition of Consolidated
EBITDA were deemed to be references to the Unrestricted Subsidiaries).

Reports and documents required to be delivered pursuant to Section 9.04 may be
delivered electronically and if so delivered, shall be deemed to have been
delivered on the date (i) on which Borrower posts such reports and/or documents,
or provides a link thereto on Borrower’s website on the Internet at the website
address specified below Borrower’s name on the signature hereof or such other
website address as provided in accordance with Section 13.02; or (ii) on which
such reports and/or documents are posted on Borrower’s behalf on an Internet or
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Lender and Administrative Agent have access (whether a commercial, third-party
website (including the website of the SEC) or whether sponsored by
Administrative Agent); provided that: Borrower shall provide to Administrative
Agent by electronic mail electronic versions (i.e., soft copies) of such reports
and/or documents and Administrative Agent shall post such reports and/or
documents and notify (which may be by facsimile or electronic mail) each Lender
of the posting of any such reports and/or documents. Notwithstanding anything
contained herein, in every instance Borrower shall be required to provide the
compliance certificate required by Section 9.04(c)(ii) to Administrative Agent
in the form of an original paper copy or a .pdf or facsimile copy of the
original paper copy.

Borrower hereby acknowledges that (a) Administrative Agent will make available
to the Lenders materials and/or information provided by or on behalf of Borrower
hereunder (collectively, “Borrower Materials”) by posting Borrower Materials on
IntraLinks/IntraAgency or another similar electronic system (the “Platform”) and
(b) certain of the Lenders (each, a “Public Lender”) may have personnel who do
not wish to receive material non-public information with respect to Borrower or
its Affiliates, or the respective securities of any of the foregoing, and who
may be engaged in investment and other market-related activities with respect to
such Persons’ securities. Borrower hereby agrees that it will use commercially
reasonable efforts to identify that portion of Borrower Materials that may be
distributed to the Public Lenders and that (w) all such Borrower Materials shall
be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean
that the word “PUBLIC” shall appear prominently on the first page thereof;
(x) by marking Borrower Materials “PUBLIC,” Borrower shall be deemed to have
authorized Administrative Agent and the Lenders to treat such Borrower Materials
as not containing any material non-public information (although it may be
sensitive and proprietary) with respect to Borrower or its securities for
purposes of United States Federal and state securities laws (provided however,
that to the extent such Borrower Materials constitute information of the type
subject to Section 13.10, they shall be treated as set forth in Section 13.10);
(y) all Borrower Materials marked “PUBLIC” are permitted to be made available
through a portion of the Platform designated “Public Side Information;” and
(z) Administrative Agent shall be entitled to treat any Borrower Materials that
are not marked “PUBLIC” as being suitable only for posting on a portion of the
Platform not designated “Public Side Information.”

SECTION 9.05. Maintaining Records; Access to Properties and Inspections.
Borrower and its Restricted Subsidiaries shall keep proper books of record and
account in which entries true and correct in all material respects and in
material conformity with GAAP and all material Requirements of Law are made.
Borrower and its Restricted Subsidiaries will, subject to applicable Gaming
Laws, permit any representatives designated by Administrative Agent or any
Lender to visit and inspect the financial records and the property of Borrower
or such Restricted Subsidiary at reasonable times, upon reasonable notice and as
often as reasonably requested, and permit any representatives designated by
Administrative Agent or any Lender to discuss the affairs, finances and
condition of such Restricted Subsidiaries with the officers thereof and
independent accountants therefor (provided Borrower has the opportunity to
participate in such meetings); provided that, in the absence of a continuing
Default or Event of Default, only one such inspection by such representatives
(on behalf of Administrative Agent and/or any Lender) shall be permitted in any
fiscal year (and such inspection shall be at Administrative Agent and/or such
Lenders’ expense, as applicable). Notwithstanding anything to the contrary in
this Agreement, no Company will be required to disclose, permit the inspection,
examination or making of extracts, or discussion of, any document, information
or other matter that (i) in respect of which disclosure to Administrative Agent
(or its designated representative) or any Lender is then prohibited by law or
contract or (ii) is subject to attorney-client or similar privilege or
constitutes attorney work product.

SECTION 9.06. Use of Proceeds. Borrower shall use the proceeds of the Loans only
for the purposes set forth in Section 8.11. Borrower will not request any
Borrowing, and Borrower shall not use, and shall procure that its Subsidiaries
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shall not use, the proceeds of any Borrowing (A) in furtherance of an offer,
payment, promise to pay, or authorization of the payment or giving of money, or
anything else of value, to any Person in violation of any Anti-Corruption Laws,
(B) for the purpose of funding, financing or facilitating any activities,
business or transaction of or with any Sanctioned Person, or in any Sanctioned
Country, to the extent such activities, business or transaction would be
prohibited by Sanctions if conducted by a corporation incorporated in the United
States or in a European Union member state, or (C) in any manner that would
result in the violation of any Sanctions applicable to any party hereto.

SECTION 9.07. Compliance with Environmental Law. Borrower and its Restricted
Subsidiaries shall (a) comply with Environmental Law, and will keep or cause all
Real Property to be kept free of any Liens imposed under Environmental Law,
unless, in each case, failure to do so would not reasonably be expected to have
a Material Adverse Effect; (b) in the event of any Hazardous Material at, on,
under or emanating from any Real Property which could result in liability under
or a violation of any Environmental Law, in each case which would reasonably be
expected to have a Material Adverse Effect, undertake, and/or cause any of their
respective tenants or occupants to undertake, at no cost or expense to
Administrative Agent, Collateral Agent or any Lender, any action required
pursuant to Environmental Law to mitigate and eliminate such condition;
provided, however, that no Company shall be required to comply with any order or
directive which is being contested in good faith and by proper proceedings so
long as it has maintained adequate reserves with respect to such compliance to
the extent required in accordance with GAAP; and (c) at the written request of
Administrative Agent, in its reasonable discretion, provide, at no cost or
expense to Administrative Agent, Collateral Agent or any Lender, an
environmental site assessment (including, without limitation, the results of any
soil or groundwater or other testing conducted at Administrative Agent’s
request) concerning any Real Property now or hereafter owned, leased or operated
by Borrower or any of its Restricted Subsidiaries, conducted by an environmental
consulting firm proposed by such Credit Party and approved by Administrative
Agent in its reasonable discretion indicating the presence or absence of
Hazardous Material and the potential cost of any required action in connection
with any Hazardous Material on, at, under or emanating from such Real Property;
provided, however, that such request may be made only if (i) there has occurred
and is continuing an Event of Default, or (ii) circumstances exist that
reasonably could be expected to form the basis of an Environmental Action
against Borrower or any Restricted Subsidiary or any Real Property of Borrower
or any of its Restricted Subsidiaries which would reasonably be expected to have
a Material Adverse Effect; if Borrower or any of its Restricted Subsidiaries
fails to provide the same within sixty (60) days after such request was made (or
in such longer period as may be approved by Administrative Agent, in its
reasonable discretion), Administrative Agent may but is under no obligation to
conduct the same, and Borrower or its Restricted Subsidiary shall grant and
hereby grants to Administrative Agent and its agents, advisors and consultants
access at reasonable times, and upon reasonable notice to Borrower, to such Real
Property and specifically grants Administrative Agent and its agents, advisors
and consultants an irrevocable non-exclusive license, subject to the rights of
tenants, to undertake such an assessment, all at no cost or expense to
Administrative Agent, Collateral Agent or any Lender. Administrative Agent will
use its commercially reasonable efforts to obtain from the firm conducting any
such assessment usual and customary agreements to secure liability insurance and
to treat its work as confidential and shall promptly provide Borrower with all
documents relating to such assessment.

SECTION 9.08. Pledge or Mortgage of Real Property and Vessels.

(a) Subject to compliance with applicable Gaming Laws, if, after the Closing
Date any Credit Party shall acquire any Property (other than any Real Property,
any Vessel or Replacement Vessel (other than leasehold interests in any Vessel
or Replacement Vessel) or any Property that is subject to a Lien permitted under
Section 10.02(i) or Section 10.02(k) to the extent and for so long as the
contract or other agreement in which such Lien is granted validly prohibits the
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Obligations on such Property and to the extent such prohibition is not
superseded by the applicable provisions of the UCC), including, without
limitation, pursuant to any Permitted Acquisition, or as to which Collateral
Agent, for the benefit of the Secured Parties, does not have a perfected Lien
and as to which the Security Documents are intended to cover, such Credit Party
shall (subject to any applicable provisions set forth in the Security Agreement
with respect to limitations on grant of security interests in certain types of
assets or Pledged Collateral and limitations or exclusions from the requirement
to perfect Liens on such assets or Pledged Collateral) promptly (i) execute and
deliver to Collateral Agent such amendments to the Security Documents or such
other documents as Collateral Agent deems necessary or advisable in order to
grant to Collateral Agent, for the benefit of the Secured Parties, security
interests in such Property and (ii) take all actions necessary or advisable to
grant to Collateral Agent, for the benefit of the Secured Parties, a perfected
second priority security interest (except to the extent limited by applicable
Requirements of Law (including, without limitation, any Gaming Laws)), subject
to no Liens other than Permitted Liens, in each case, to the extent such actions
are required by the Security Agreement; provided, that notwithstanding the
foregoing, the Credit Parties shall not be required to take such actions with
respect to (x) any leasehold interest in any Vessel or Replacement Vessel
entered into after the date hereof which leasehold interest has a fair market
value (including the reasonably anticipated fair market value of the Gaming
Facility or other improvements to be developed thereon) of less than
$20.0 million or with a remaining term (including options to extend) of less
than 10 years or (y) any leasehold interest in any Vessel or Replacement Vessel
if after the exercise of commercially reasonable efforts by the Credit Parties
(which shall not include the payment of consideration other than reasonable
attorneys’ fees and other expenses incidental thereto), the lessor under such
lease has not consented to the granting of such security interest.

(b) If, after the Closing Date, any Credit Party (x) acquires, including,
without limitation, pursuant to any Permitted Acquisition, a fee or leasehold
interest in Real Property located in the United States which Real Property (or,
in the case of a leasehold, such leasehold interest or estate) has a fair market
value in excess of $20.0 million or (y) develops a Gaming Facility on any fee or
leasehold interest in Real Property located in the United States which Real
Property (including the reasonably anticipated fair market value of the Gaming
Facility or other improvements to be developed thereon) has a fair market value
in excess of $20.0 million, determined on an as-developed basis, in each case,
with respect to which a Mortgage was not previously entered into in favor of
Collateral Agent (in each case, other than to the extent such Real Property is
subject to a Lien permitted under Section 10.02(i) or 10.02(k) securing
Indebtedness to the extent and for so long as the contract or other agreement in
which such Lien is granted validly prohibits the creation of Liens securing the
Obligations on such Real Property), such Credit Party shall promptly notify
Collateral Agent and, if requested by the Required Lenders or Collateral Agent,
within sixty (60) days of such request (in each case, or such longer period that
is reasonably acceptable to Administrative Agent), (i) take such actions and
execute such documents as Collateral Agent shall reasonably require to confirm
the Lien of an existing Mortgage, if applicable, or to create a new Mortgage on
such additional Real Property and (ii) cause to be delivered to Collateral
Agent, for the benefit of the Secured Parties, all documents and instruments
reasonably requested by Collateral Agent or as shall be necessary in the opinion
of counsel to Collateral Agent to create on behalf of the Secured Parties a
valid, perfected, mortgage Lien, subject only to Permitted Liens, including the
following:

(1) A Mortgage in favor of Collateral Agent, for the benefit of the Secured
Parties, in form for recording in the recording office of the jurisdiction where
such Mortgaged Real Property is situated, together with such other documentation
as shall be required to create a valid mortgage Lien under applicable law, which
Mortgage and other documentation shall be reasonably satisfactory to Collateral
Agent and shall be effective to create in favor of Collateral Agent for the

 

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benefit of the Secured Parties a valid, perfected, Mortgage Lien on such
Mortgaged Real Property subject to no Liens other than Permitted Liens; and

(2) with respect to each Mortgage and each Mortgaged Real Property, each of the
items set forth in Section 9.15(a)(i)(6) and, in each case to the extent
reasonably requested by the Required Lenders or Collateral Agent, each of the
items set forth in Sections 9.15(a)(i)(2) through 9.15(a)(i)(5);

provided, that notwithstanding the foregoing, the Credit Parties shall not be
required to grant a Mortgage on (i) any leasehold interest in any Real Property
entered into after the Closing Date with a remaining term (including options to
extend) of less than 10 years or (ii) any leasehold interest in any Real
Property if after the exercise of commercially reasonable efforts by the Credit
Parties (which shall not include the payment of consideration other than
reasonable attorneys’ fees and other expenses incidental thereto), the landlord
under such lease has not consented to the granting of a Mortgage; provided
further, that in no case shall the Credit Parties be required to grant a
Mortgage on any Route Agreement (or real property associated therewith), any
Real Property associated with that certain Gaming Facility commonly known as
“Gold Town Casino” located in Pahrump, Nevada or any interest in real property
associated with distributed gaming ownership or operations; provided further,
that, notwithstanding the foregoing, the delivery of the items required under
this Section 9.08(b) shall not be required prior to the date that is ninety
(90) days after the Closing Date (or such later date as agreed by Administrative
Agent).

(c) If, after the Closing Date, any Credit Party (x) acquires, including,
without limitation, pursuant to any Permitted Acquisition, a fee interest in any
Vessel or a Replacement Vessel with a fair market value in excess of
$20.0 million located or otherwise maintained in the United States and
registered with the United States Coast Guard or (y) develops a Gaming Facility
with a fair market value in excess of $20.0 million, determined on an
as-developed basis, on any such Vessel or a Replacement Vessel, located or
otherwise maintained in the United States and registered with the United States
Coast Guard, in each case, with respect to which a Ship Mortgage or other
similar instrument was not previously entered into in favor of Collateral Agent
(other than to the extent such Vessel or Replacement Vessel is subject to a Lien
permitted under Section 10.02(i) or 10.02(k) securing Indebtedness to the extent
and for so long as the contract or other agreement in which such Lien is granted
validly prohibits the creation of Liens securing the Obligations on such Vessel
or Replacement Vessel), such Credit Party shall promptly notify Collateral Agent
and, if requested by the Required Lenders or Collateral Agent, within sixty
(60) days of such request (or such longer period that is reasonably acceptable
to Administrative Agent), (i) take such actions and execute such documents as
Collateral Agent shall reasonably require to confirm the Lien of an existing
Ship Mortgage or other similar instrument, if applicable, or to create a new
Ship Mortgage or other similar instrument on such Vessel or Replacement Vessel
and (ii) cause to be delivered to Collateral Agent, for the benefit of the
Secured Parties, all documents and instruments reasonably requested by
Collateral Agent or as shall be necessary in the opinion of counsel to
Collateral Agent to create on behalf of the Secured Parties a legal, valid and
enforceable first preferred ship mortgage under Chapter 313 of Title 46 of the
United States Code (if applicable thereto) subject to Permitted Liens, including
the following:

(1) a Ship Mortgage or other similar instrument reasonably satisfactory to
Collateral Agent, granting in favor of Collateral Agent for the benefit of the
Secured Parties a legal, valid and enforceable first preferred ship mortgage on
each such Vessel or Replacement Vessel under Chapter 313 of Title 46 of the
United States Code subject to Permitted Liens, executed and delivered by a duly
authorized officer of the appropriate Credit Party, together with such
certificates, affidavits and instruments as shall be reasonably required in
connection with filing or recordation thereof and to grant a Lien on each such
Vessel or Replacement Vessel; and

 

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(2) with respect to each Ship Mortgage or other similar instrument and each such
Vessel or Replacement Vessel, in each case to the extent reasonably requested by
the Required Lenders or Collateral Agent, certificates of insurance as required
by each Ship Mortgage or other similar instrument, if applicable, which
certificates shall comply with the insurance requirements contained in
Section 9.02 and the applicable Ship Mortgage or other similar instrument;

provided, that notwithstanding the foregoing, the delivery of the items required
under this Section 9.08(c) shall not be required prior to the date that is
ninety (90) days after the Closing Date (or such later date as agreed by
Administrative Agent).

(d) Notwithstanding anything contained in Sections 9.08(a), 9.08(b) and 9.08(c)
to the contrary, in each case, it is understood and agreed that no Lien(s),
Mortgage(s) and/or Ship Mortgage(s) in favor of Collateral Agent on any after
acquired Property of the applicable Credit Party shall be required to be granted
or delivered at such time as provided in such Sections (as applicable) as a
result of such Lien(s), Mortgage(s) and/or Ship Mortgage(s) being prohibited by
the applicable Gaming Authorities or applicable Law; provided, however, that
Borrower has used its commercially reasonable efforts to obtain such approvals.

(e) With respect to Lien(s), Mortgage(s) and/or Ship Mortgage(s) relating to any
Property acquired (or leased) by any Credit Party after the Closing Date or any
Property of any Additional Credit Party or with respect to any Guarantee of any
Additional Credit Party, in each case that were not granted or delivered
pursuant to Section 9.08(d) or to the second paragraph in Section 9.11, as the
case may be, at such time as Borrower reasonably believes such prohibition no
longer exists, Borrower shall (and with respect to any items requiring approval
from Gaming Authorities, Borrower shall use commercially reasonable efforts to
seek the approval from the applicable Gaming Authorities for such Lien(s),
Mortgage(s), Ship Mortgage(s) and/or Guarantee and, if such approval is so
obtained), comply with Sections 9.08(a), 9.08(b) and/or 9.08(c) or with
Section 9.11, as the case may be.

SECTION 9.09. Security Interests; Further Assurances. Each Credit Party shall,
promptly, upon the reasonable request of Collateral Agent, and so long as such
request (or compliance with such request) does not violate any Gaming Law or, if
necessary, is approved by the Gaming Authority (which Borrower hereby agrees to
use commercially reasonable efforts to obtain), at Borrower’s expense, execute,
acknowledge and deliver, or cause the execution, acknowledgment and delivery of,
and thereafter register, file or record, or cause to be registered, filed or
recorded, in an appropriate governmental office, any document or instrument
supplemental to or confirmatory of the Security Documents or otherwise deemed by
Collateral Agent reasonably necessary or desirable to create, protect or perfect
or for the continued validity, perfection and priority of the Liens on the
Collateral covered or purported to be covered thereby (subject to any applicable
provisions set forth herein and in the Security Agreement with respect to
limitations on grant of security interests in certain types of Pledged
Collateral and limitations or exclusions from the requirement to perfect Liens
on such Pledged Collateral and any applicable Requirements of Law including,
without limitation, any Gaming Laws) subject to no Liens other than Permitted
Liens; provided that, notwithstanding anything to the contrary herein or in any
other Credit Document, in no event shall any Company be required to enter into
control agreements with respect to its deposit accounts, securities accounts or
commodity accounts. In the case of the exercise by Collateral Agent or the
Lenders or any other Secured Party of any power, right, privilege or remedy
pursuant to any Credit Document following the occurrence and during the
continuation of an Event of Default which requires any consent, approval,
registration, qualification or authorization of any Governmental Authority,
Borrower and each of its Restricted Subsidiaries shall use commercially
reasonable efforts to execute and deliver all applications, certifications,
instruments and other documents and papers that Collateral Agent or the Lenders
may be so required to obtain. If Collateral Agent

 

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reasonably determines that it is required by applicable Requirement of Law to
have appraisals prepared in respect of the Real Property of any Credit Party
constituting Collateral, Borrower shall provide to Collateral Agent appraisals
that satisfy the applicable requirements of the Real Estate Appraisal Reform
Amendments of FIRREA; provided further, that prior to the Discharge of Senior
Obligations (as defined in the First Lien/Second Lien Intercreditor Agreement),
the obligation to deliver any possessory Collateral shall be deemed to have been
satisfied to the extent such deliverables are delivered to, or are in the
possession of, the collateral agent under the First Lien Credit Agreement if and
only to the extent such collateral agent holds such deliverables for the benefit
of the Collateral Agent and the Secured Parties subject to the First Lien/Second
Lien Intercreditor Agreement.

SECTION 9.10. [Reserved].

SECTION 9.11. Additional Credit Parties. Upon (i) any Credit Party creating or
acquiring any Subsidiary that is a Restricted Subsidiary (other than any
Excluded Subsidiary) after the Closing Date, (ii) any Restricted Subsidiary of a
Credit Party ceasing to be an Excluded Subsidiary or (iii) any Revocation that
results in an Unrestricted Subsidiary becoming a Restricted Subsidiary (other
than any Excluded Subsidiary) of a Credit Party (such Restricted Subsidiary
referenced in clause (i), (ii) or (iii) above, an “Additional Credit Party”),
such Credit Party shall, assuming and to the extent that it does not violate any
Gaming Law or assuming and to the extent it obtains the approval of the Gaming
Authority to the extent such approval is required by applicable Gaming Laws
(which Borrower hereby agrees to use commercially reasonable efforts to obtain),
(A) cause each such Restricted Subsidiary to promptly (but in any event within
45 days (or 95 days, in the event of any Discharge of any Indebtedness in
connection with the acquisition of any such Subsidiary) after the later of such
event described in clause (i), (ii) or (iii) above or receipt of such approval
(or such longer period of time as Administrative Agent may agree to in its sole
discretion), execute and deliver all such agreements, guarantees, documents and
certificates (including Joinder Agreements, any amendments to the Credit
Documents and a Perfection Certificate)) as Administrative Agent may reasonably
request in order to have such Restricted Subsidiary become a Guarantor and
(B) promptly (I) execute and deliver to Collateral Agent such amendments to or
additional Security Documents as Collateral Agent deems necessary or advisable
in order to grant to Collateral Agent for the benefit of the Secured Parties, a
perfected security interest in the Equity Interests of such new Restricted
Subsidiary which are owned by any Credit Party and required to be pledged
pursuant to the Security Agreement, (II) deliver to Collateral Agent the
certificates (if any) representing such Equity Interests together with in the
case of such Equity Interests, undated stock powers endorsed in blank,
(III) cause such new Restricted Subsidiary to take such actions necessary or
advisable (including executing and delivering a Joinder Agreement) to grant to
Collateral Agent for the benefit of the Secured Parties, a perfected security
interest in the collateral described in (subject to any requirements set forth
herein and in the Security Agreement with respect to limitations on grant of
security interests in certain types of assets or Pledged Collateral and
limitations or exclusions from the requirement to perfect Liens on such Pledged
Collateral and excluding acts with respect to perfection of security interests
and Liens not required under, or excluded from the requirements under, this
Agreement and the Security Agreement) the Security Agreement and all other
Property (limited, in the case of any Subsidiary that is a CFC or CFC Holdco, to
65% of the voting Equity Interests and 100% of the non-voting Equity Interests
of such Subsidiary) of such Restricted Subsidiary in accordance with the
provisions of Section 9.08 hereof with respect to such new Restricted
Subsidiary, or by law or as may be reasonably requested by Collateral Agent, and
(IV) deliver to Collateral Agent all legal opinions reasonably requested by
Administrative Agent relating to the matters described above covering matters
similar to those covered in the opinions delivered on the Closing Date with
respect to such Guarantor; provided, however, that Borrower shall use its
commercially reasonable efforts to obtain such approvals for any Mortgage(s),
Ship Mortgage(s) and Lien(s) (including pledge of the Equity Interests of such
Subsidiary) to be granted by

 

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such Restricted Subsidiary and for the Guarantee of such Restricted Subsidiary
as soon as reasonably practicable. All of the foregoing actions shall be at the
sole cost and expense of the Credit Parties.

Notwithstanding the foregoing in this Section 9.11 to the contrary, it is
understood and agreed that no Lien(s), Mortgage(s), Ship Mortgage(s) and/or
Guarantee of the applicable Additional Credit Party shall be required to be
granted or delivered at such time as provided in the paragraph above in this
Section 9.11 as a result of such Lien(s), Mortgage(s), Ship Mortgage(s) and/or
Guarantee being prohibited by the applicable Gaming Authorities, any other
applicable Governmental Authorities or applicable Law; provided, however, that
Borrower has used its commercially reasonable efforts to obtain such approvals
for such Lien(s), Mortgage(s), Ship Mortgage(s) and/or Guarantee.

SECTION 9.12. Limitation on Designations of Unrestricted Subsidiaries.

(a) Borrower may, on or after the Closing Date, designate any Subsidiary of
Borrower as an “Unrestricted Subsidiary” under this Agreement (a “Designation”)
only if:

(i) no Event of Default shall have occurred and be continuing at the time of or
immediately after giving effect to such Designation;

(ii) Borrower would be permitted under this Agreement to make an Investment at
the time of Designation (assuming the effectiveness of such Designation) in an
amount (the “Designation Amount”) equal to the fair market value of the net
assets of such Subsidiary owned by Borrower and/or any of the Restricted
Subsidiaries on such date; and

(iii) such Subsidiary shall also have been designated as an Unrestricted
Subsidiary under the First Lien Credit Agreement.

Upon any such Designation after the Closing Date, Borrower and its Restricted
Subsidiaries shall be deemed to have made an Investment in such Unrestricted
Subsidiary in an amount equal to the Designation Amount.

(b) Borrower may revoke any Designation of a Subsidiary as an Unrestricted
Subsidiary (a “Revocation”), whereupon such Subsidiary shall then constitute a
Restricted Subsidiary, if:

(i) no Event of Default shall have occurred and be continuing at the time and
immediately after giving effect to such Revocation;

(ii) all Liens and Indebtedness of such Unrestricted Subsidiary and its
Subsidiaries outstanding immediately following such Revocation would, if
incurred at the time of such Revocation, have been permitted to be incurred for
all purposes of this Agreement; and

(iii) any designation of such Subsidiary as an “Unrestricted Subsidiary” shall
have also been revoked under the First Lien Credit Agreement.

(c) All Designations and Revocations occurring after the Closing Date must be
evidenced by an Officer’s Certificate of Borrower delivered to Administrative
Agent with the Responsible Officer so executing such certificate certifying
compliance with the foregoing provisions of Section 9.12(a) (in the case of any
such Designations) and of Section 9.12(b) (in the case of any such Revocations).

 

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(d) If Borrower designates a Guarantor as an Unrestricted Subsidiary in
accordance with this Section 9.12, the Obligations of such Guarantor under the
Credit Documents shall terminate and be of no further force and effect and all
Liens granted by such Guarantor under the applicable Security Documents shall
terminate and be released and be of no further force and effect, and all Liens
on the Equity Interests and debt obligations of such Guarantor shall be
terminated and released and of no further force and effect, in each case,
without any action required by Administrative Agent or Collateral Agent. At
Borrower’s request, Administrative Agent and Collateral Agent will execute and
deliver any instrument evidencing such termination and Collateral Agent shall
take all actions appropriate in order to effect such termination and release of
such Liens and without recourse or warranty by Collateral Agent (including the
execution and delivery of appropriate UCC termination statements and such other
instruments and releases as may be necessary and appropriate to effect such
release). Any such foregoing actions taken by Administrative Agent and/or
Collateral Agent shall be at the sole cost and expense of Borrower.

SECTION 9.13. Limitation on Designation of Immaterial Subsidiaries.

(a) At Borrower’s election, Borrower may at any time, designate a Restricted
Subsidiary as an Immaterial Subsidiary, but only to the extent that such
designation is consistent with the definition of “Immaterial Subsidiary”. Upon
any Immaterial Subsidiary’s (whether designated as such on the Closing Date or
thereafter pursuant to the preceding sentence) ceasing to satisfy any of the
requirements set forth in the definition of such term or Borrower ceasing to
satisfy clause (b) below, Borrower shall notify Administrative Agent thereof and
shall take the actions required pursuant to Section 9.11 and the applicable
Subsidiary (or in the case of a failure to satisfy clause (b) below, the
Subsidiaries selected by Borrower) shall cease to be an Immaterial Subsidiary.

(b) Any designation of a Subsidiary as an Immaterial Subsidiary, or revocation
of any such designation, must be evidenced by an Officer’s Certificate of
Borrower delivered to Administrative Agent with the Responsible Officer
executing such certificate certifying compliance with the foregoing provisions
of Section 9.13(a).

SECTION 9.14. Ratings. Borrower shall use commercially reasonable efforts to
obtain and maintain at all times on and after the Closing Date (i) a public
corporate family rating of Borrower and a rating of the Loans, in each case from
Moody’s, and (ii) a public corporate credit rating of Borrower and a rating of
the Loans, in each case from S&P (it being understood and agreed that
“commercially reasonable efforts” shall in any event include the payment by
Borrower of customary rating agency fees, cooperation with information and data
requests by Moody’s and S&P in connection with their ratings process and the
participation by senior management of Borrower in a ratings presentation to
Moody’s and S&P).

SECTION 9.15. Post-Closing Matters. Borrower will cause to be delivered or
performed, as applicable, each of the following:

(a) Mortgage Matters. On or before the date that is ninety (90) days after the
Closing Date or, in the case of the Rocky Gap Property ninety (90) days after
receipt of all necessary approvals from the landlord and other Governmental
Authorities for the provision of a leasehold Mortgage encumbering the Rocky Gap
Property (or, in each case, such later date as is permitted by Administrative
Agent in its sole discretion):

(i) Mortgaged Real Property. Administrative Agent shall have received with
respect to each Mortgaged Real Property identified on Schedule 1.01(C): (1) a
Mortgage reasonably satisfactory to Administrative Agent and in form for
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of each political subdivision where each such Mortgaged Real Property is
situated, which Mortgage shall, when recorded, be effective to create in favor
of Collateral Agent on behalf of the Secured Parties a valid, enforceable and
perfected second priority Lien (except to the extent limited by applicable
Requirements of Law (including, without limitation, any Gaming Laws)) on such
Mortgaged Real Property subordinate to no Liens other than Permitted Liens,
(2) with respect to each Mortgage, legal opinions, each of which shall be
addressed to Administrative Agent, Collateral Agent and the Lenders, dated the
effective date of such Mortgage and covering such matters as Administrative
Agent shall reasonably request, including, but not limited to, the
enforceability of such Mortgage and the due authorization, execution and
delivery of such Mortgage, in a manner customary for transactions of this type
and otherwise in form and substance reasonably satisfactory to Administrative
Agent, (3) with respect to each Mortgage, a policy or policies of title
insurance issued by a nationally recognized title insurance company insuring the
Lien of each such Mortgage as a valid second priority Lien on the Mortgaged Real
Property described therein, free of any other Liens except Permitted Liens, in
amounts and in form and substance reasonably acceptable to Administrative Agent,
together with such endorsements, coinsurance and reinsurance as Administrative
Agent may reasonably request, (4) such surveys (including existing surveys
together with affidavits of no-change) sufficient for the title company to
remove all standard survey exceptions from the mortgage title policy relating to
such Mortgaged Real Property and issue the survey-related endorsements otherwise
in form and substance reasonably satisfactory to Administrative Agent; provided,
however, that no such surveys shall be required with respect to any Specified
Land until such time as a Gaming Facility is developed thereon that has a fair
market value in excess of $20.0 million, determined on an as-developed basis,
(5) with respect to each Mortgage and/or each Mortgaged Real Property, such
fixture filings, insurance certificates, consents, estoppels, memoranda of
lease, Governmental Real Property Disclosure Requirements, certificates,
affidavits, instruments, returns and other documents as shall be deemed
reasonably necessary by Administrative Agent, in each case, in form and
substance reasonably acceptable to Administrative Agent and (6) a completed
“Life-of-Loan” Federal Emergency Management Agency standard flood hazard
determination with respect to each such Mortgaged Real Property, and if such
Mortgaged Real Property is located in a special flood hazard area, a notice
about special flood hazard area status and flood disaster assistance duly
executed by Borrower and the applicable Credit Party relating thereto together
with evidence of insurance as required pursuant to Section 9.02(c).

(b) Additional Post-Closing Deliverables. Each of the documents and other
agreements set forth on Schedule 9.15 shall be delivered or performed, as
applicable, within the respective time frames specified therein (or, in each
case, such later date as is permitted by Administrative Agent in its sole
discretion).

SECTION 9.16. Title Insurance. In the event that the Mortgages delivered
pursuant to Section 9.15(a)(i)(1) hereof at any time become first priority Liens
on the Mortgaged Real Properties encumbered thereby, then, with respect to the
title insurance policies delivered pursuant to Section 9.15(a)(i)(3) hereof,
Borrower shall obtain additional title insurance coverage such that the total
amount of coverage of all such title policies, in the aggregate, equals the
total amount of the Loans then outstanding.

 

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ARTICLE X.

NEGATIVE COVENANTS

Each Credit Party, for itself and on behalf of its Restricted Subsidiaries,
covenants and agrees with Administrative Agent, Collateral Agent and Lenders
that until the Obligations have been Paid in Full (and each Credit Party
covenants and agrees that it will cause its Restricted Subsidiaries to observe
and perform the covenants herein set forth applicable to any such Restricted
Subsidiary until the Obligations have been Paid in Full):

SECTION 10.01. Indebtedness. Borrower and its Restricted Subsidiaries will not
incur any Indebtedness, except:

(a) Indebtedness incurred pursuant to (i) this Agreement and the other Credit
Documents and (ii) (x) the First Lien Credit Agreement and the other First Lien
Credit Documents in an aggregate amount not to exceed the sum of $900.0 million
plus any additional amounts permitted to be incurred pursuant to Section 2.12 of
the First Lien Credit Agreement (as in effect on the date hereof) and (y) any
Permitted Refinancing thereof;

(b) Indebtedness outstanding on the Closing Date and listed on Schedule 10.01,
and any Permitted Refinancings thereof;

(c) Indebtedness under any Swap Contracts (including, without limitation, any
Interest Rate Protection Agreements); provided that such Swap Contracts are
entered into for bona fide hedging activities and not for speculative purposes;

(d) intercompany Indebtedness of Borrower and the Restricted Subsidiaries to
Borrower or other Restricted Subsidiaries to the extent permitted pursuant to
Section 10.04;

(e) Indebtedness representing deferred compensation to employees of Borrower and
the Restricted Subsidiaries incurred in the ordinary course of business;

(f) Indebtedness in respect of workers’ compensation claims, self-insurance
obligations, performance bonds, surety, appeal or similar bonds, completion
guarantees and letters of credit provided by Borrower or any of its Restricted
Subsidiaries in the ordinary course of its business (including to support
Borrower’s or any of its Restricted Subsidiaries’ applications for Gaming
Licenses or for the purposes referenced in this clause (f));

(g) Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument drawn against insufficient
funds in the ordinary course of business; provided, however, that such
Indebtedness is extinguished within five (5) Business Days of its incurrence;

(h) Indebtedness (other than Indebtedness referred to in Section 10.01(b)) in
respect of Purchase Money Obligations and Capital Lease Obligations and
refinancings or renewals thereof, in an aggregate principal amount not to exceed
at any time outstanding, the greater of $60.0 million and 35% of Consolidated
EBITDA at the time of determination for the Test Period most recently ended and,
without duplication, Permitted Refinancings thereof;

(i) Indebtedness arising in connection with endorsement of instruments for
deposit in the ordinary course of business;

 

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(j) guarantees by Borrower or Restricted Subsidiaries of Indebtedness otherwise
permitted to be incurred by Borrower or any Restricted Subsidiary under this
Section 10.01;

(k) Indebtedness of a Person that becomes a Subsidiary of Borrower or any of its
Restricted Subsidiaries after the date hereof in connection with a Permitted
Acquisition or other Acquisition permitted hereunder; provided, however, that
such Indebtedness existed at the time such Person became a Subsidiary and was
not created in anticipation or contemplation thereof, and Permitted Refinancings
thereof;

(l) Indebtedness that has been Discharged;

(m) Escrowed Indebtedness;

(n) unsecured Indebtedness of the kind described in clause (d) of the definition
of “Indebtedness” so long, in the case of any such Indebtedness other than
earn-out obligations, at the time of incurrence thereof, no Event of Default
shall have occurred and be continuing after giving effect thereto;

(o) Permitted Unsecured Refinancing Debt and Permitted Second Priority
Refinancing Debt;

(p) Indebtedness of Joint Ventures in an aggregate principal amount that at the
time of, and after giving effect to, the incurrence thereof, would not, at any
time outstanding, exceed the greater of $12.0 million and 5% of Consolidated
EBITDA at the time of determination for the Test Period most recently ended,
and, without duplication, any Permitted Refinancings thereof;

(q) Indebtedness of Borrower or any Restricted Subsidiary in an aggregate
principal amount outstanding at any time not to exceed the greater of
$42.0 million and25% of Consolidated EBITDA at the time of determination for the
Test Period most recently ended (provided, that Indebtedness of Non-Credit
Parties incurred pursuant to this Section 10.01(q) shall not exceed the
Non-Credit Party Cap on the date of incurrence thereof) and, without
duplication, Permitted Refinancings thereof;

(r) Indebtedness consisting of the financing of insurance premiums in the
ordinary course of business;

(s) Investments under Section 10.04(k), 10.04(l) and 10.04(m), in each case,
consisting of guarantees;

(t) (A) Indebtedness of Borrower or any Restricted Subsidiaries in respect of
one or more series of senior unsecured notes or loans, senior secured first lien
notes or loans, senior secured pari passu or junior lien notes or loans or
subordinated notes or loans that may be secured by the Collateral on a senior,
pari passu or junior basis with the Obligations, as applicable, that are issued
or made pursuant to an indenture, a loan agreement or a note purchase agreement
or otherwise (any such Indebtedness, “Ratio Debt”); provided that (i) the
aggregate principal amount of Ratio Debt issued or incurred pursuant to this
Section 10.01(t) on such date shall not exceed the Ratio Debt Amount as of such
date; (ii) no Event of Default shall have occurred and be continuing or would
exist immediately after giving effect to such Ratio Debt; provided that, if the
proceeds of such Ratio Debt are primarily being used to finance a Limited
Condition Transaction substantially concurrently upon the receipt thereof, the
lenders or other Persons providing such Ratio Debt may waive such condition
(other than an Event of Default specified in Section 11.01(b) or 11.01(c) or an
Event of Default specified in Section 11.01(g) or 11.01(h) with respect to
Borrower); (iii) other than customary “bridge” facilities (so long as the long
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such customary “bridge” facility is to be converted satisfies the requirements
of this clause (iii)), if such Ratio Debt is (x) secured on a pari passu basis
with the Obligations, such Ratio Debt shall have a maturity date and Weighted
Average Life to Maturity (without giving effect to prepayments that reduce
scheduled amortization) no shorter than any then-existing Tranche of Term Loans
or (y) secured on a junior lien basis or is unsecured, such Ratio Debt shall
satisfy the definition of Permitted Junior Debt Conditions; (iv) if such Ratio
Debt is secured (x) on pari passu basis with the Obligations, the holders of
such Indebtedness (or their representative) and Administrative Agent shall be
party to the Pari Passu Intercreditor Agreement or (y) on a first lien basis to
the Obligations, the holders of such Indebtedness (or their representative)
shall be party to the First Lien/Second Lien Intercreditor Agreement (as “First
Priority Debt Parties”) with Administrative Agent; (v) any Indebtedness of
Non-Credit Parties incurred pursuant to this Section 10.01(t) shall not exceed
the Non-Credit Party Cap on the date of incurrence thereof; (vi) except as set
forth in clauses (i) – (v) of this paragraph (t), if such Ratio Debt is secured
on pari passu basis with the Obligations the terms (excluding maturity,
amortization, pricing, fees, rate floors, premiums, optional prepayment or
optional redemption provisions) of any Ratio Debt shall be (as determined by
Borrower in good faith) substantially identical to the terms of the Term B
Facility Loans, as applicable, as existing on the date of incurrence of such
Ratio Debt except, to the extent such terms (x) at the option of Borrower
(1) reflect market terms and conditions (taken as a whole) at the time of
incurrence or issuance (as determined by Borrower in good faith); provided that,
if any financial maintenance covenant is added for the benefit of any Ratio
Debt, such financial maintenance covenant shall also be applicable to the Term B
Facility Loans (except to the extent such financial maintenance covenant applies
only to periods after the Final Maturity Date), (2) with respect to any such
Indebtedness that is unsecured, are customary for issuances of “high yield”
securities; provided that, if any financial maintenance covenant is added for
the benefit of any such Ratio Debt, such financial maintenance covenant shall
also be applicable to the Term B Facility Loans (except to the extent such
financial maintenance covenant applies only to periods after the Final Maturity
Date), or (3) are not materially more restrictive to Borrower (as determined by
Borrower in good faith), when taken as a whole, than the terms of the Term B
Facility Loans (except for covenants or other provisions applicable only to
periods after the Final Maturity Date applicable to the Term B Facility Loans)
(it being understood that any Ratio Debt may provide for the ability to
participate (i) with respect to any borrowings, voluntary prepayments or
voluntary commitment reductions, on a pro rata basis, greater than pro rata
basis or less than pro rata basis with the applicable Loans or facility and
(ii) with respect to any mandatory prepayments, on a pro rata basis or less than
pro rata basis with the applicable Loans (and on a greater than pro rata basis
with respect to prepayments of any such Ratio Debt with the proceeds of
permitted refinancing Indebtedness), or (y) are (1) added to the Term B Facility
Loans, (2) applicable only after the Final Maturity Date or (3) otherwise
reasonably satisfactory to Administrative Agent (it being understood that to the
extent any financial maintenance covenant is added for the benefit of any such
Ratio Debt, no consent shall be required from Administrative Agent or any of the
Lenders to the extent that such financial maintenance covenant (together with
any related “equity cure” provisions) is also added for the benefit of any
corresponding existing Facility); and (vii) if such Ratio Debt is secured on
pari passu basis with the Obligations, is in the form of term loan debt, then if
the All-In Yield applicable to such Ratio Debt is greater than the All-In Yield
payable pursuant to the terms of this Agreement as amended through the date of
such calculation with respect to Term B Facility Loans, plus 50 basis points per
annum, then the interest rate with respect to the Term B Facility Loans shall be
increased so as to cause the then applicable All-In Yield under this Agreement
on the Term B Facility Loans to equal the All-In Yield then applicable to such
Ratio Debt, minus 50 basis points; provided, however, that any increase in
All-In Yield due to such Ratio Debt having a higher “LIBO Rate floor” or
“Alternate Base Rate floor” shall, as the election of Borrower, be reflected
solely as an increase to the applicable LIBO Rate floor or Alternate Base Rate
floor, as applicable, for the Term B Facility; and (B) any Permitted Refinancing
in respect thereof that satisfies clause (A)(iv) and (A)(vi) above;

 

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(u) Indebtedness constituting Development Expenses that are used to finance, or
incurred or issued for the purpose of financing, Expansion Capital Expenditures
or Development Projects in an aggregate principal amount not to exceed
$90.0 million at any time outstanding so long as no Event of Default shall have
occurred and be continuing after giving effect thereto and, without duplication,
Permitted Refinancings thereof;

(v) Indebtedness of Restricted Subsidiaries that are Non-Credit Parties in an
aggregate amount not to exceed the greater of $18.0 million and 12.5% of
Consolidated EBITDA at the time of determination for the Test Period most
recently ended prior to such time, so long as such Indebtedness is not
guaranteed by any Credit Party (provided, that Indebtedness of Non-Credit
Parties incurred pursuant to this Section 10.01(v) shall not exceed the
Non-Credit Party Cap on the date of incurrence thereof) and, without
duplication, Permitted Refinancings thereof;

(w) Indebtedness consisting of promissory notes issued by Borrower to recent or
former officers, directors or employees (or heirs of, estates of or trusts
formed by such Persons) to finance the purchase or redemption of Equity
Interests of Borrower permitted by Section 10.06(f); provided that (i) such
Indebtedness shall be subordinated in right of payment to the Obligations on
terms reasonably satisfactory to Administrative Agent (it being understood that,
subject to the dollar limitation described below, such subordination provisions
shall permit the payment of interest and principal in cash if no Event of
Default has occurred and is continuing) and (ii) the aggregate amount of all
cash payments (whether principal or interest) made by Borrower in respect of
such notes, when combined with the aggregate amount of Restricted Payments made
pursuant to Section 10.06(f), shall not exceed $9.0 million in any fiscal year
of Borrower;

(x) Indebtedness incurred by Borrower or the Restricted Subsidiaries in (i) a
Permitted Acquisition, (ii) any other Investment expressly permitted hereunder
or (iii) any Asset Sale, in the case of each of the foregoing clauses (i), (ii)
and (iii), constituting customary indemnification obligations or customary
obligations in respect of purchase price or other similar adjustments;

(y) Indebtedness in an amount equal to 100% of the Net Available Proceeds of any
issuance or sale of Equity Interests or capital contribution (other than in
connection with any Permitted Equity Issuances pursuant to Section 11.03 in the
First Lien Credit Agreement) received by Borrower to the extent not otherwise
utilized in this Article X; and

(z) all premium (if any, including tender premiums), expenses, defeasance costs,
interest (including post-petition interest), fees, expenses, charges and
additional or contingent interest on obligations described in paragraphs (a)
through (y) above.

For purposes of determining compliance with this Section 10.01, the amount of
any Indebtedness denominated in any currency other than Dollars shall be
calculated based on customary currency exchange rates in effect, in the case of
such Indebtedness incurred (in respect of term Indebtedness) or committed (in
respect of revolving Indebtedness) on or prior to the Closing Date, on the
Closing Date and, in the case of such Indebtedness incurred (in respect of term
Indebtedness) or committed (in respect of revolving Indebtedness) after the
Closing Date, on the date that such Indebtedness was incurred (in respect of
term Indebtedness) or committed (in respect of revolving Indebtedness); provided
that if such Indebtedness is incurred to refinance other Indebtedness
denominated in a currency other than Dollars (or in a different currency from
the Indebtedness being refinanced), and such refinancing would cause the
applicable Dollar-denominated restriction to be exceeded if calculated at the
relevant currency exchange rate in effect on the date of such refinancing, such
Dollar-denominated restriction shall be deemed not to have been exceeded so long
as the principal amount of such refinancing Indebtedness does not exceed (i)

 

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the outstanding or committed principal amount, as applicable, of such
Indebtedness being refinanced plus (ii) the aggregate amount of fees,
underwriting discounts, premiums (including tender premiums), defeasance costs
and other costs and expenses incurred in connection with such refinancing.

For purposes of determining compliance with this Section 10.01 and the
calculation of the Incremental Loan Amount and Ratio Debt Amount, if the use of
proceeds from any incurrence, issuance or assumption of Indebtedness is to fund
the refinancing of any Indebtedness, then such refinancing shall be deemed to
have occurred substantially simultaneously with such incurrence, issuance or
assumption so long as (1) such refinancing occurs on the same Business Day as
such incurrence, issuance or assumption, (2) if such proceeds will be offered
(through a tender offer or otherwise) to the holders of such Indebtedness to be
refinanced, the proceeds thereof are deposited with a trustee, agent or other
representative for such holders pending the completion of such offer on the same
Business Day as such incurrence, issuance or assumption (and such proceeds are
ultimately used in the consummation of such offer or otherwise used to refinance
Indebtedness), (3) if such proceeds will be used to fund the redemption,
discharge or defeasance of such Indebtedness to be refinanced, the proceeds
thereof are deposited with a trustee, agent or other representative for such
Indebtedness pending such redemption, discharge or defeasance on the same
Business Day as such incurrence, issuance or assumption or (4) the proceeds
thereof are otherwise set aside to fund such refinancing pursuant to procedures
reasonably agreed with Administrative Agent. In addition, with respect to any
Indebtedness that was permitted to be incurred hereunder on the date of such
incurrence, any Increased Amount of such Indebtedness shall also be permitted
hereunder after the date of such incurrence.

SECTION 10.02. Liens. Neither Borrower nor any Restricted Subsidiary shall
create, incur, grant, assume or permit to exist, directly or indirectly, any
Lien on any Property now owned or hereafter acquired by it or on any income or
revenues or rights in respect of any thereof, except (the “Permitted Liens”):

(a) Liens for Taxes, assessments or governmental charges or levies not yet due
and payable or delinquent and Liens for Taxes, assessments or governmental
charges or levies, which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been established in accordance
with GAAP;

(b) Liens in respect of property of Borrower or any Restricted Subsidiary
imposed by law, which were incurred in the ordinary course of business and do
not secure Indebtedness for borrowed money, such as carriers’, warehousemen’s,
materialmen’s, landlord’s and mechanics’ liens, maritime liens and other similar
Liens arising in the ordinary course of business (i) for amounts not yet overdue
for a period of sixty (60) days or (ii) for amounts that are overdue for a
period in excess of sixty (60) days that are being contested in good faith by
appropriate proceedings (inclusive of amounts that remain unpaid as a result of
bona fide disputes with contractors, including where the amount unpaid is
greater than the amount in dispute), so long as adequate reserves have been
established in accordance with GAAP;

(c) Liens securing Indebtedness incurred pursuant to Section 10.01(b) and listed
on Schedule 10.02; provided, however, that (i) such Liens do not encumber any
Property of Borrower or any Restricted Subsidiary other than (x) any such
Property subject thereto on the Closing Date, (y) after-acquired property that
is affixed or incorporated into Property covered by such Lien and (z) proceeds
and products thereof, and (ii) the amount of Indebtedness secured by such Liens
does not increase, except as contemplated by Section 10.01(b);

 

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(d) easements, rights-of-way, restrictions (including zoning restrictions),
covenants, encroachments, protrusions and other similar charges or encumbrances,
and minor title deficiencies on or with respect to any Real Property, in each
case whether now or hereafter in existence, not (i) securing Indebtedness and
(ii) individually or in the aggregate materially interfering with the conduct of
the business of Borrower and its Restricted Subsidiaries, taken as a whole;
provided that upon request by Borrower, Administrative Agent shall, in its
reasonable discretion, direct Collateral Agent on behalf of the Secured Parties
to subordinate its Mortgage on any related Real Property to such easements,
rights-of-way, restrictions (including zoning restrictions), covenants,
encroachments, protrusions and other similar charges or encumbrances in such
form as is reasonably satisfactory to Administrative Agent and Borrower;

(e) Liens arising out of judgments or awards not resulting in an Event of
Default;

(f) Liens (other than any Lien imposed by ERISA) (i) imposed by law or deposits
made in connection therewith in the ordinary course of business in connection
with workers’ compensation, unemployment insurance and other types of social
security, (ii) incurred in the ordinary course of business to secure the
performance of tenders, statutory obligations (other than excise taxes), surety,
stay, customs and appeal bonds, statutory bonds, bids, leases, government
contracts, trade contracts, rental obligations (limited, in the case of rental
obligations, to security deposits and deposits to secure obligations for taxes,
insurance, maintenance and similar obligations), utility services, performance
and return of money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money), (iii) arising by virtue of
deposits made in the ordinary course of business to secure liability for
premiums to insurance carriers or (iv) Liens on deposits made to secure
Borrower’s or any of its Subsidiaries’ Gaming License applications or to secure
the performance of surety or other bonds issued in connection therewith;
provided, however, that to the extent such Liens are not imposed by Law, such
Liens shall in no event encumber any Property other than cash and Cash
Equivalents or, in the case of clause (iii), proceeds of insurance policies;

(g) Leases with respect to the assets or properties of any Credit Party or its
respective Subsidiaries, in each case entered into in the ordinary course of
such Credit Party’s or Subsidiary’s business so long as each of the Leases
entered into after the date hereof with respect to Real Property constituting
Collateral are subordinate in all respects to the Liens granted and evidenced by
the Security Documents and do not, individually or in the aggregate,
(x) interfere in any material respect with the ordinary conduct of the business
of the Credit Parties and their respective Subsidiaries, taken as a whole, or
(y) materially impair the use (for its intended purposes) or the value of the
Properties of the Credit Parties and their respective Subsidiaries, taken as a
whole; provided that upon the request of Borrower, Collateral Agent shall enter
into a customary subordination and non-disturbance and attornment agreement in
connection with any such Lease;

(h) Liens arising out of conditional sale, title retention, consignment or
similar arrangements for the sale of goods entered into by Borrower or such
Restricted Subsidiary in the ordinary course of business;

(i) Liens arising pursuant to Purchase Money Obligations or Capital Lease
Obligations (and refinancings or renewals thereof), in each case, incurred
pursuant to Section 10.01(h); provided, however, that (i) the Indebtedness
secured by any such Lien (including refinancings thereof) does not exceed 100%
of the cost of the property being acquired, constructed, improved or leased at
the time of the incurrence of such Indebtedness (plus, in the case of
refinancings, any Increased Amounts) and (ii) any such Liens attach only to the
property being financed pursuant to such Purchase Money Obligations or Capital
Lease Obligations (or in the case of refinancings which were previously financed
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Money Obligations or Capital Lease Obligations) (and directly related assets,
including proceeds and replacements thereof) and do not encumber any other
Property of Borrower or any Restricted Subsidiary (it being understood that all
Indebtedness to a single lender shall be considered to be a single Purchase
Money Obligation, whether drawn at one time or from time to time and individual
financings provided by one lender may be cross-collateralized to other
financings provided by such lender);

(j) bankers’ Liens, rights of setoff and other similar Liens existing solely
with respect to cash and Cash Equivalents on deposit in one or more accounts
maintained by Borrower or any Restricted Subsidiary, in each case granted in the
ordinary course of business in favor of the bank or banks with which such
accounts are maintained, securing amounts owing to such bank with respect to
cash management and operating account arrangements, including those involving
pooled accounts and netting arrangements, provided, however, that, unless such
Liens are non-consensual and arise by operation of law, in no case shall any
such Liens secure (either directly or indirectly) the repayment of any
Indebtedness;

(k) Liens on assets of a Person existing at the time such Person is acquired or
merged with or into or consolidated with Borrower or any Restricted Subsidiary
(and not created in connection with or in anticipation or contemplation
thereof); provided, however, that such Liens do not extend to assets not subject
to such Liens at the time of acquisition (other than improvements and
attachments thereon, accessions thereto and proceeds thereof) and are no more
favorable to the lienholders than the existing Lien;

(l) in addition to Liens otherwise permitted by this Section 10.02, other Liens
incurred with respect to any Indebtedness or other obligations of Borrower or
any of its Subsidiaries; provided, however, that the aggregate principal amount
of such Indebtedness secured by such Liens at any time outstanding shall not
exceed the greater of $42.0 million and 25% of Consolidated EBITDA at the time
of determination for the Test Period most recently ended;

(m) licenses of Intellectual Property granted by Borrower or any Restricted
Subsidiary in the ordinary course of business and not interfering in any
material respect with the ordinary conduct of the business of Borrower and its
Restricted Subsidiaries, taken as a whole;

(n) (i) Liens pursuant to the Credit Documents and (ii) Liens securing
Indebtedness permitted by Section 10.01(a)(ii); provided that the holders of
such Indebtedness (or their representative) shall be party to the First
Lien/Second Lien Intercreditor Agreement (as “First Priority Debt Parties”) or a
Pari Passu Intercreditor Agreement with Administrative Agent;

(o) Permitted Vessel Liens;

(p) Liens arising under applicable Gaming Laws; provided, however, that no such
Lien constitutes a Lien securing repayment of Indebtedness for borrowed money;

(q) (i) Liens pursuant to leases entered into for the purpose of, or with
respect to, operating or managing gaming facilities and related assets, which
Liens are limited to the leased property under the applicable lease and granted
to the landlord under such lease for the purpose of securing the obligations of
the tenant under such lease to such landlord and (ii) Liens on cash and Cash
Equivalents (and on the related escrow accounts or similar accounts, if any)
required to be paid to the lessors (or lenders to such lessors) under such
leases or maintained in an escrow account or similar account pending application
of such proceeds in accordance with the applicable lease;

 

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(r) Liens to secure Indebtedness incurred pursuant to Section 10.01(v); provided
that such Liens do not encumber any Property of Borrower or any Restricted
Subsidiary other than any Non-Credit Party and any Equity Interests in any
Non-Credit Party;

(s) Prior Mortgage Liens with respect to the applicable Mortgaged Real Property
so long as such Liens do not secure Indebtedness;

(t) Liens on cash and Cash Equivalents deposited to Discharge, redeem or defease
Indebtedness that was permitted to so be repaid and on any cash and Cash
Equivalents held by a trustee under any indenture or other debt agreement issued
in escrow pursuant to customary escrow arrangements pending the release thereof;

(u) Liens arising from precautionary UCC financing statements filings regarding
operating leases or consignment of goods entered into in the ordinary course of
business;

(v) Liens on the Collateral securing Permitted Second Priority Refinancing Debt
and subject to the Pari Passu Intercreditor Agreement;

(w) Liens securing Ratio Debt, and Permitted Refinancings thereof, in each case,
permitted under Section 10.01(t) and subject to the Pari Passu Intercreditor
Agreement or the First Lien/Second Lien Intercreditor Agreement (in the case of
Liens intended to be senior to the Liens securing the Obligations, as “First
Priority Liens”), as and to the extent applicable;

(x) Liens solely on any cash earnest money deposits made by Borrower or any of
its Subsidiaries in connection with any letter of intent or purchase agreement
in respect of a Permitted Acquisition or Investment (including any other
Acquisition) not prohibited by this Agreement;

(y) in the case of any non-Wholly Owned Subsidiary or Joint Venture, any put and
call arrangements or restrictions on disposition related to its Equity Interests
set forth in its organizational documents or any related joint venture or
similar agreement;

(z) Liens arising in connection with transactions relating to the selling or
discounting of accounts receivable in the ordinary course of business;

(aa) licenses, leases or subleases granted to other Persons not materially
interfering with the conduct of the business of Borrower and its Subsidiaries
taken as a whole;

(bb) any interest or title of a lessor, sublessor, licensee or licensor under
any lease or license agreement permitted by this Agreement;

(cc) Liens created by the applicable Transfer Agreement;

(dd) Liens arising pursuant to Indebtedness incurred pursuant to
Section 10.01(u); provided that such Liens do not encumber any Property of
Borrower or any Restricted Subsidiary other than the Property financed by the
Indebtedness incurred pursuant to Section 10.01(u);

(ee) Liens to secure Indebtedness incurred pursuant to Section 10.01(p);
provided that such Liens do not encumber any Property other than the Property of
any Joint Venture and the Equity Interests in the applicable Joint Venture;

 

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(ff) Liens on Property of any Restricted Subsidiary that is not a Credit Party
and in the Equity Interests of any applicable Non-Credit Party which Liens
secure Indebtedness of Non-Credit Parties permitted under Section 10.01; and

(gg) Liens to secure any refinancing, refunding, extension, renewal or
replacement (or successive refinancings, refundings, extensions, renewals or
replacements) as a whole, or in part, of any Indebtedness secured by any Lien
permitted by this Section 10.02; provided, however, that (x) such new Lien shall
be limited to all or part of the same type of property that secured the original
Lien (plus improvements on and accessions to such property, proceeds and
products thereof, customary security deposits and any other assets pursuant to
after-acquired property clauses to the extent such assets secured (or would have
secured) the Indebtedness being refinanced), (y) the Indebtedness secured by
such Lien at such time is not increased to any amount greater than the sum of
(A) the outstanding principal amount (or accreted value, if applicable) of such
Indebtedness or, if greater, committed amount of the applicable Indebtedness at
the time the original Lien became a Lien permitted hereunder and (B) any unpaid
accrued interest and premium (including tender premiums) thereon and an amount
necessary to pay associated underwriting discounts, defeasance costs, fees,
commissions and expenses related to such refinancing, refunding, extension,
renewal or replacement, and (z) Indebtedness secured by Liens ranking junior to
the Liens securing the Obligations may not be refinanced pursuant to this clause
(gg) with Liens ranking pari passu to the Liens securing the Obligations.

In connection with the granting of Liens of the types described in clauses (c),
(d), (g), (i), (k), (l), (m), (n), (p), (q), (r), (s), (t), (v), (w), (aa), (bb)
and (gg) of this Section 10.02 by Borrower of any of its Restricted
Subsidiaries, Administrative Agent and Collateral Agent shall be authorized to
take any actions deemed appropriate by it in connection therewith (including,
without limitation, by entering into or amending appropriate lien subordination,
non-disturbance, attornment or intercreditor agreements).

In addition, with respect to any Lien securing Indebtedness that was permitted
to secure such Indebtedness at the time of the incurrence of such Indebtedness,
such Lien shall also be permitted to secure any Increased Amount of such
Indebtedness.

SECTION 10.03. [Reserved].

SECTION 10.04. Investments, Loans and Advances. Neither Borrower nor any
Restricted Subsidiary will, directly or indirectly, make any Investment, except
for the following:

(a) Investments and commitments to make Investments outstanding on the Closing
Date and identified on Schedule 10.04 and any Investments received in respect
thereof without the payment of additional consideration (other than through the
issuance of or exchange of Qualified Capital Stock);

(b) Investments in cash and Cash Equivalents;

(c) Borrower may enter into Swap Contracts to the extent permitted by
Section 10.01(c);

(d) Investments (i) by Borrower in any Restricted Subsidiary, (ii) by any
Restricted Subsidiary in Borrower and (iii) by a Restricted Subsidiary in
another Restricted Subsidiary (provided that Investments pursuant to clauses
(i) and (iii) by Credit Parties in Non-Credit Parties shall not exceed (x)
$24.0 million in the aggregate outstanding at any time plus (y) an amount equal
to any returns (including dividends, interest, distributions, returns of
principal, profits on sale, repayments, income and similar amounts) actually
received in respect of any such Investment); provided that, in each case, any
intercompany loan (it being understood and agreed that intercompany receivables
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ordinary course of business do not constitute loans) in excess of $12.0 million
individually shall be evidenced by a promissory note and, to the extent that the
payee, holder or lender of such intercompany loan is a Credit Party, such
promissory note shall be pledged (and delivered) by such Credit Party to
Collateral Agent on behalf of the Secured Parties;

(e) Borrower and its Restricted Subsidiaries may sell or transfer assets to the
extent permitted by Section 10.05;

(f) Investments in securities of trade creditors or customers or suppliers
received pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers or suppliers or in
settlement of delinquent or overdue accounts in the ordinary course of business
or Investments acquired by Borrower as a result of a foreclosure by Borrower or
any of the Subsidiaries with respect to any secured Investments or other
transfer of title with respect to any secured Investment in default;

(g) Investments made by Borrower or any Restricted Subsidiary as a result of
consideration received in connection with an Asset Sale made in compliance with
Section 10.05;

(h) Investments consisting of (i) moving, entertainment and travel expenses,
drawing accounts and similar expenditures made to officers, directors, managers
and employees in the ordinary course of business, (ii) loans or advances to
officers, directors, managers and employees in connection with such Persons’
purchase of Equity Interests of Borrower (provided that the amount of such loans
and advances described in this clause (h)(ii) shall be contributed to Borrower
in cash as common equity) and (iii) other loans or advances to officers,
directors, managers and employees for any other purpose not described in the
foregoing clauses (i) and (ii); provided that the aggregate principal amount
outstanding at any time under the foregoing clauses (ii) and (iii) shall not
exceed $12.0 million in the aggregate at any time outstanding;

(i) Permitted Acquisitions;

(j) extensions of trade credit (including to gaming customers) and prepayments
of expenses in the ordinary course of business;

(k) in addition to Investments otherwise permitted by this Section 10.04, other
Investments by Borrower or any of its Restricted Subsidiaries in an amount not
to exceed the sum of (i) the greater of $120.0 million and 70% of Consolidated
EBITDA at the time of determination for the Test Period most recently ended
during the term of this Agreement plus (ii) the Initial Restricted Payment Base
Amount as of such date plus (iii) the Specified 10.04(k) Investment Returns
received on or prior to such date plus (iv) any reduction in the amount of such
Investments as provided in the definition of “Investments”;

(l) in addition to Investments otherwise permitted by this Section 10.04,
Investments by Borrower or any of its Restricted Subsidiaries; provided that
(i) the amount of such Investments to be made pursuant to this Section 10.04(l)
do not exceed the Available Amount determined at the time such Investment is
made and (ii) immediately before and after giving effect thereto, no Event of
Default has occurred and is continuing;

(m) additional Investments so long as, at the time such Investment is made and
after giving effect thereto, (x) no Event of Default has occurred and is
continuing and (y) the Consolidated Total Net Leverage Ratio is less than or
equal to 4.85 to 1.00 on a Pro Forma Basis as of the most recent Calculation
Date;

 

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(n) payments with respect to any Qualified Contingent Obligations, so long as,
at the time such Qualified Contingent Obligation was incurred or, if earlier,
the agreement to incur such Qualified Contingent Obligations was entered into,
such Investment was permitted under this Agreement;

(o) Investments of a Restricted Subsidiary acquired after the Closing Date or of
a Person merged or consolidated with or into Borrower or a Restricted
Subsidiary, in each case in accordance with the terms of this Agreement to the
extent that such Investments were not made in contemplation of or in connection
with such acquisition, merger or consolidation and were in existence (or were
committed) on the date of such acquisition, merger or consolidation;

(p) Investments in the nature of pledges or deposits (i) with respect to leases
or utilities provided to third parties in the ordinary course of business or
(ii) under Sections 10.02(f), (j), (t) or (x);

(q) advances of payroll payments to employees of Borrower and the Restricted
Subsidiaries in the ordinary course of business;

(r) the occurrence of a Reverse Trigger Event under any applicable Transfer
Agreement;

(s) Investments in Joint Ventures or other non-Wholly Owned Subsidiaries of
Borrower or any of its Restricted Subsidiaries taken together with all other
Investments made pursuant to this clause (s) that are at that time outstanding
not to exceed the sum of (i) the greater of $9.0 million and 7.5% of
Consolidated EBITDA at the time of determination for the Test Period most
recently ended (in each case, determined on the date such Investment is made,
with the fair market value of each Investment being measured at the time made
and without giving effect to subsequent changes in value) plus (ii) any
reduction in the amount of such Investments as provided in the definition of
“Investments”;

(t) Investments in Unrestricted Subsidiaries taken together with all other
Investments made pursuant to this clause (t) that are at that time outstanding
not to exceed the sum of (i) the greater of $9.0 million and 7.5% of
Consolidated EBITDA at the time of determination for the Test Period most
recently ended (in each case, determined on the date such Investment is made,
with the fair market value of each Investment being measured at the time made
and without giving effect to subsequent changes in value) plus (ii) any
reduction in the amount of such Investments as provided in the definition of
“Investments”;

(u) Guarantees by Borrower or any Restricted Subsidiary of operating leases
(other than Capital Lease Obligations) or of other obligations that do not
constitute Indebtedness, in each case entered into by Borrower or any Subsidiary
in the ordinary course of business;

(v) Investments to the extent that payment for such Investments is made with
Equity Interests in Borrower (other than Disqualified Capital Stock);

(w) any Investment (i) deemed to exist as a result of a Restricted Subsidiary
that is not a Credit Party distributing a note or other intercompany debt to a
parent of such Restricted Subsidiary that is a Credit Party (to the extent there
is no cash consideration or services rendered for such note) and (ii) consisting
of intercompany current liabilities in connection with the cash management, tax
and accounting operations of Borrower and the Restricted Subsidiaries;

(x) Investments in joint ventures established to develop or operate nightclubs,
bars, restaurants, recreation, exercise or gym facilities, or entertainment or
retail venues or similar or related establishments or facilities within, in
close proximity to or otherwise for the benefit of any Property of Borrower and
its Restricted Subsidiaries (as reasonably determined by Borrower) (provided
that

 

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Investments pursuant to this clause (x) shall not exceed (i) $12.0 million in
the aggregate outstanding at any time, plus (ii) an amount equal to any returns
(including dividends, interest, distributions, returns of principal, profits on
sale, repayments, income and similar amounts) actually received in respect of
any such Investment);

(y) Restricted Payments permitted by Section 10.06 and Junior Prepayments
permitted by Section 10.09;

(z) Investments in connection with the Transactions; and

(aa) Investments consisting of the contribution or other transfer of any
Specified Land.

Any Investment in any person other than a Credit Party that is otherwise
permitted by this Section 10.04 may be made through intermediate Investments in
Restricted Subsidiaries that are not Credit Parties and such intermediate
Investments shall be disregarded for purposes of determining the outstanding
amount of Investments pursuant to any clause set forth above. The amount of any
Investment made other than in the form of cash or cash equivalents shall be the
fair market value thereof valued at the time of the making thereof, and without
giving effect to any subsequent write-downs or write-offs thereof.

SECTION 10.05. Mergers, Consolidations and Sales of Assets. Neither Borrower nor
any Restricted Subsidiary will wind up, liquidate or dissolve its affairs or
enter into any transaction of merger or consolidation (other than solely to
change the jurisdiction of organization or type of organization (to the extent
in compliance with the applicable provisions of the Security Agreement)), or
convey, sell, lease or sublease (as lessor or sublessor), transfer or otherwise
dispose of any substantial part of its business, property or assets, except for:

(a) Capital Expenditures, Expansion Capital Expenditures and expenditures of
Development Expenses by Borrower and the Restricted Subsidiaries;

(b) Sales or dispositions of used, worn out, obsolete or surplus Property or
Property no longer useful in the business of Borrower by Borrower and the
Restricted Subsidiaries in the ordinary course of business and the abandonment
or other sale of Intellectual Property that is, in the reasonable judgment of
Borrower, no longer economically practicable to maintain or useful in the
conduct of the business of Borrower and its Restricted Subsidiaries taken as a
whole; and the termination or assignment of Contractual Obligations to the
extent such termination or assignment does not have a Material Adverse Effect;

(c) Asset Sales by Borrower or any Restricted Subsidiary; provided that (i) at
the time of such Asset Sale, no Event of Default then exists or would arise
therefrom, (ii) Borrower or any of its Restricted Subsidiaries shall receive not
less than 75% of such consideration in the form of (x) cash or Cash Equivalents
or (y) Permitted Business Assets (in each case, free and clear of all Liens at
the time received other than Permitted Liens) (it being understood that for the
purposes of clause (c)(ii)(x), the following shall be deemed to be cash: (A) any
liabilities (as shown on Borrower’s or such Restricted Subsidiary’s most recent
balance sheet provided hereunder or in the footnotes thereto) of Borrower or
such Restricted Subsidiary, other than liabilities that are by their terms
subordinated to the payment in cash of the Obligations, that are assumed by the
transferee with respect to the applicable Asset Sale and for which Borrower and
all of its Restricted Subsidiaries shall have been validly released by all
applicable creditors in writing, (B) any securities received by Borrower or such
Restricted Subsidiary from such transferee that are converted by Borrower or
such Restricted Subsidiary into cash or Cash Equivalents (to the extent of the
cash or Cash Equivalents received) within one hundred and eighty (180) days
following

 

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the closing of the applicable disposition, (C) any Designated Non-Cash
Consideration received in respect of such disposition having an aggregate fair
market value, taken together with all other Designated Non-Cash Consideration
received pursuant to this clause (C) that is at that time outstanding, not in
excess of the greater of $30.0 million and 17.5% of Consolidated EBITDA at the
time of determination for the Test Period most recently ended, with the fair
market value of each item of Designated Non-Cash Consideration being measured at
such date of receipt or such agreement, as applicable, and without giving effect
to subsequent changes in value) and (iii) the Net Available Proceeds therefrom
shall be applied as specified in Section 2.10(a)(iii);

(d) Liens permitted by Section 10.02, Investments may be made to the extent
permitted by Sections 10.04, Restricted Payments may be made to the extent
permitted by Section 10.06 and Junior Prepayments may be made to the extent
permitted by Section 10.09;

(e) Borrower and the Restricted Subsidiaries may dispose of cash and Cash
Equivalents;

(f) Borrower and the Restricted Subsidiaries may lease (as lessor or sublessor)
real or personal property to the extent permitted under Section 10.02;

(g) licenses and sublicenses by Borrower or any of its Restricted Subsidiaries
of software and Intellectual Property in the ordinary course of business shall
be permitted;

(h) (A) Borrower or any Restricted Subsidiary may transfer or lease Property to
or acquire or lease Property from Borrower or any Restricted Subsidiary;
provided that the sum of (x) the aggregate fair market value of all Property
transferred by Borrower and Domestic Subsidiaries of Borrower that are
Restricted Subsidiaries to Foreign Subsidiaries of Borrower under this clause
(A) plus (y) all lease payments made by Borrower and Domestic Subsidiaries of
Borrower that are Restricted Subsidiaries to Foreign Subsidiaries of Borrower in
respect of leasing of property by Borrower and Domestic Subsidiaries of Borrower
that are Restricted Subsidiaries from Foreign Subsidiaries shall not exceed
$12.0 million in any fiscal year of Borrower; (B) any Restricted Subsidiary may
merge or consolidate with or into Borrower (as long as Borrower is the surviving
Person) or any Guarantor (as long as the surviving Person is, or becomes
substantially concurrently with such merger or consolidation, a Guarantor);
(C) any Restricted Subsidiary may merge or consolidate with or into any other
Restricted Subsidiary (so long as, if either Restricted Subsidiary is a
Guarantor, the surviving Person is, or becomes substantially concurrently with
such merger or consolidation, a Guarantor); and (D) any Restricted Subsidiary
may be voluntarily liquidated, voluntarily wound up or voluntarily dissolved (so
long as any such liquidation or winding up does not constitute or involve an
Asset Sale to any Person other than to Borrower or any other Restricted
Subsidiary or any other owner of Equity Interests in such Restricted Subsidiary
unless such Asset Sale is otherwise permitted pursuant to this Section 10.05);
provided, however, that, in each case with respect to clauses (A), (B) and
(C) of this Section 10.05(h) (other than in the case of a transfer to a Foreign
Subsidiary permitted under clause (A) above), the Lien on such property granted
in favor of Collateral Agent under the Security Documents shall be maintained in
accordance with the provisions of this Agreement and the applicable Security
Documents;

(i) voluntary terminations of Swap Contracts and other assets or contracts in
the ordinary course of business;

(j) conveyances, sales, leases, transfers or other dispositions which do not
constitute Asset Sales;

 

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(k) any taking by a Governmental Authority of assets or property, or any part
thereof, under the power of eminent domain or condemnation;

(l) Borrower and its Restricted Subsidiaries may make sales, transfers or other
dispositions of property subject to a Casualty Event;

(m) Borrower and its Restricted Subsidiaries may make sales, transfers or other
dispositions of Investments in Joint Ventures to the extent required by, or made
pursuant to, customary buy/sell arrangements between the joint venture parties
set forth in joint venture arrangements and similar binding arrangements;

(n) any transfer of Equity Interests of any Restricted Subsidiary or any Gaming
Facility in connection with the occurrence of a Trigger Event;

(o) (i) the lease, sublease or license of any portion of any Property to Persons
who, either directly or through Affiliates of such Persons, intend to operate or
manage nightclubs, bars, restaurants, recreation areas, spas, pools, exercise or
gym facilities, or entertainment or retail venues or similar or related
establishments or facilities and (ii) the grant of declarations of covenants,
conditions and restrictions and/or easements with respect to common area spaces
and similar instruments benefiting such tenants of such leases, subleases and
licenses (collectively, the “Venue Easements,” and together with any such
leases, subleases or licenses, collectively the “Venue Documents”); provided
that no Venue Document or operations conducted pursuant thereto would reasonably
be expected to materially interfere with, or materially impair or detract from,
the operations of Borrower and the Restricted Subsidiaries taken as a whole;
provided further that upon request by Borrower, Collateral Agent on behalf of
the Secured Parties shall provide the tenant, subtenant or licensee under any
Venue Document with a subordination, non-disturbance and attornment agreement in
form reasonably satisfactory to Collateral Agent and the applicable Credit
Party;

(p) the dedication of space or other dispositions of Property in connection with
and in furtherance of constructing structures or improvements reasonably related
to the development, construction and operation of any project; provided that in
each case such dedication or other dispositions are in furtherance of, and do
not materially impair or interfere with the operations of Borrower and the
Restricted Subsidiaries;

(q) dedications of, or the granting of easements, rights of way, rights of
access and/or similar rights, to any Governmental Authority, utility providers,
cable or other communication providers and/or other parties providing services
or benefits to any project, any Real Property held by Borrower or the Restricted
Subsidiaries or the public at large that would not reasonably be expected to
interfere in any material respect with the operations of Borrower and the
Restricted Subsidiaries; provided that upon request by Borrower, Administrative
Agent shall, in its reasonable discretion, direct Collateral Agent on behalf of
the Secured Parties to subordinate its Mortgage on such Real Property to such
easement, right of way, right of access or similar agreement in such form as is
reasonably satisfactory to Administrative Agent and Borrower;

(r) any disposition of Equity Interests in a Restricted Subsidiary pursuant to
an agreement or other obligation with or to a person (other than Borrower and
the Restricted Subsidiaries) from whom such Restricted Subsidiary was acquired
or from whom such Restricted Subsidiary acquired its business and assets (having
been newly formed in connection with such acquisition), made as part of such
acquisition and in each case comprising all or a portion of the consideration in
respect of such sale or acquisition;

 

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(s) dispositions of non-core assets acquired in connection with a Permitted
Acquisition or other permitted Investment; provided, that (i) the amount of
non-core assets that are disposed of in connection with any such Permitted
Acquisition or other permitted Investment pursuant to this Section 10.05(s) does
not exceed 25% of the aggregate purchase price for such Permitted Acquisition or
other permitted Investment and (ii) to the extent that any such Permitted
Acquisition or other permitted Investment is financed with the proceeds of
Indebtedness of Borrower or its Restricted Subsidiaries, then any proceeds from
such Permitted Acquisition or other permitted Investment shall be used to prepay
such Indebtedness (to the extent otherwise permitted hereunder) or the Loans in
accordance with Section 2.10 hereof;

(t) other dispositions of assets with a fair market value of not more than the
greater of $9.0 million and 7.5% of Consolidated EBITDA at the time of
determination for the Test Period most recently ended; and

(u) the Transactions.

To the extent any Collateral is sold, transferred or otherwise disposed of as
permitted by this Section 10.05 or in connection with a transaction approved by
the Required Lenders, in each case, to a Person other than a Credit Party, so
long as no Event of Default exists, such Collateral shall, except as set forth
in the proviso to Section 10.05(h), be sold, transferred or otherwise disposed
of free and clear of the Liens created by the Security Documents, and Collateral
Agent shall take all actions reasonably requested by Borrower in order to effect
the foregoing at the sole cost and expense of Borrower and without recourse or
warranty by Collateral Agent (including the execution and delivery of
appropriate UCC termination statements and such other instruments and releases
as may be necessary and appropriate to effect such release). To the extent any
such sale, transfer or other disposition results in a Guarantor no longer
constituting a Subsidiary of Borrower, so long as no Event of Default exists,
the Obligations of such Guarantor and all obligations of such Guarantor under
the Credit Documents shall terminate and be of no further force and effect, and
each of Administrative Agent and Collateral Agent shall take such actions, at
the sole expense of Borrower, as are requested by Borrower in connection with
such termination.

SECTION 10.06. Restricted Payments. Neither Borrower nor any of its Restricted
Subsidiaries shall, directly or indirectly, declare or make any Restricted
Payment at any time, except, without duplication:

(a) Borrower or any Restricted Subsidiary may make Restricted Payments to the
extent permitted pursuant to Section 2.09(b)(ii);

(b) any Restricted Subsidiary of Borrower may declare and make Restricted
Payments to Borrower or any Wholly Owned Subsidiary of Borrower which is a
Restricted Subsidiary;

(c) any Restricted Subsidiary of Borrower, if such Restricted Subsidiary is not
a Wholly Owned Subsidiary, may declare and make Restricted Payments in respect
of its Equity Interests to all holders of such Equity Interests generally so
long as Borrower or its respective Restricted Subsidiary that owns such Equity
Interest or interests in the Person making such Restricted Payments receives at
least its proportionate share thereof (based upon its relative ownership of the
subject Equity Interests and the terms thereof);

(d) Borrower and its Restricted Subsidiaries may (i) make Restricted Payments in
connection with the Transactions and (ii) engage in transactions to the extent
permitted by Section 10.05;

 

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(e) Borrower and its Restricted Subsidiaries may make Restricted Payments in
respect of Disqualified Capital Stock issued in compliance with the terms
hereof;

(f) Borrower may repurchase common stock or common stock options from present or
former officers, directors or employees (or heirs of, estates of or trusts
formed by such Persons) of any Company upon the death, disability, retirement or
termination of employment of such officer, director or employee or pursuant to
the terms of any stock option plan, employment agreement, severance agreement or
like agreement; provided, however, that the aggregate amount of payments under
this clause (f) shall not exceed in any fiscal year of Borrower the greater of
$9.0 million and 7.5% of Consolidated EBITDA at the time of determination for
the Test Period most recently ended (with unused amounts in any fiscal year
being carried over to succeeding fiscal years);

(g) Borrower and its Restricted Subsidiaries may (i) repurchase Equity Interests
to the extent deemed to occur upon exercise of stock options, warrants or rights
in respect thereof to the extent such Equity Interests represent a portion of
the exercise price of such options, warrants or rights in respect thereof and
(ii) make payments in respect of withholding or similar taxes payable or
expected to be payable by any present or former member of management, director,
officer, employee, or consultant of Borrower or any of its Subsidiaries or
family members, spouses or former spouses, heirs of, estates of or trusts formed
by such Persons in connection with the exercise of stock options or grant,
vesting or delivery of Equity Interests;

(h) Borrower and its Restricted Subsidiaries may make Restricted Payments to
allow the payment of cash in lieu of the issuance of fractional shares upon the
exercise of options or, warrants or rights or upon the conversion or exchange of
or into Equity Interests, or payments or distributions to dissenting
stockholders pursuant to applicable law;

(i) Borrower and its Restricted Subsidiaries may make Restricted Payments in an
aggregate amount not to exceed the Initial Restricted Payment Base Amount as of
such date;

(j) so long as (i) immediately before and after giving effect thereto no Event
of Default has occurred and is continuing and (ii) except for Restricted
Payments made in reliance on clauses (e), (f) or (g) of the definition of
“Available Amount”, after giving effect thereto the Consolidated Total Net
Leverage Ratio will not exceed 5.10 to 1.00 calculated on a Pro Forma Basis as
of the most recent Calculation Date, Borrower and its Restricted Subsidiaries
may make Restricted Payments in an aggregate amount not to exceed the Available
Amount determined at the time such Restricted Payment is made;

(k) so long as (i) immediately before and after giving effect thereto no Event
of Default has occurred and is continuing and (ii) after giving effect thereto
the Consolidated Total Net Leverage Ratio will not exceed 4.35 to 1.00
calculated on a Pro Forma Basis as of the most recent Calculation Date, Borrower
and its Restricted Subsidiaries may make additional Restricted Payments;

(l) to the extent constituting Restricted Payments, Borrower may make payments
to counterparties under Swap Contracts entered into in connection with the
issuance of convertible or exchangeable debt;

(m) Borrower and the Restricted Subsidiaries may make Restricted Payments that
are made in an amount equal to the amount of Excluded Contributions previously
received and that Borrower elects to apply under this clause (m) and do not
increase the Available Amount; and

 

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(n) Borrower and the Restricted Subsidiaries may make payments of amounts
necessary to repurchase or retire Equity Interests of Borrower or any Subsidiary
to the extent required by any Gaming Authority in order to avoid the suspension,
revocation or denial of a Gaming License by that Gaming Authority; provided
that, in the case of any such repurchase of Equity Interests of Borrower or any
Subsidiary, if such efforts do not jeopardize any Gaming License, Borrower or
any such Subsidiary will have previously used commercially reasonable efforts to
attempt to find a suitable purchaser for such Equity Interests and no suitable
purchaser acceptable to the applicable Gaming Authority and Borrower was willing
to purchase such Equity Interests on terms acceptable to the holder thereof
within a time period acceptable to such Gaming Authority.

SECTION 10.07. Transactions with Affiliates. Neither Borrower nor any of its
Restricted Subsidiaries shall enter into any transaction involving aggregate
consideration in excess of $5.0 million, including, without limitation, any
purchase, sale, lease or exchange of Property, the rendering of any service or
the payment of any management, advisory or similar fees, with any Affiliate
(other than Borrower or any Restricted Subsidiary); provided, however, that
notwithstanding the foregoing, Borrower and its Restricted Subsidiaries:

(a) may enter into indemnification and employment and severance agreements and
arrangements with directors, officers and employees and may pay customary fees
and reasonable out of pocket costs to, and indemnities provided on behalf of,
directors, officers, board managers and employees of Borrower and its Restricted
Subsidiaries in the ordinary course of business to the extent attributable to
the ownership or operation of Borrower and its Restricted Subsidiaries;

(b) may enter into the Transactions and the transactions described in Borrower’s
SEC filings prior to the Closing Date or listed on Schedule 10.07 hereto as in
effect on the Closing Date or any amendment thereto so long as such amendment is
not adverse to the Lenders in any material respect;

(c) may make Investments and Restricted Payments permitted hereunder;

(d) may enter into the transactions contemplated by each applicable Transfer
Agreement;

(e) may enter into customary expense sharing and tax sharing arrangements
entered into between Borrower, the Restricted Subsidiaries and Unrestricted
Subsidiaries in the ordinary course of business pursuant to which such
Unrestricted Subsidiaries shall reimburse Borrower or the applicable Restricted
Subsidiaries for certain shared expenses and taxes;

(f) may enter into transactions upon fair and reasonable terms no less favorable
to Borrower or such Restricted Subsidiary, as the case may be, than it would
obtain in a comparable arm’s length transaction with a Person that is not an
Affiliate; provided that with respect to any transaction (or series of related
transactions) involving consideration of more than $24.0 million, such
transaction shall be approved by the majority of the directors of Borrower;

(g) may enter into any transactions between or among Borrower and its
Subsidiaries (for the avoidance of doubt, including Unrestricted Subsidiaries)
and Joint Ventures that are entered into in the ordinary course of business of
Borrower and its Subsidiaries and Joint Ventures and, in the good faith judgment
of Borrower are necessary or advisable in connection with the ownership or
operation of the business of Borrower and its Subsidiaries and Joint Ventures,
including, but not limited to, (i) payroll, cash management, purchasing,
insurance and hedging arrangements and (ii) management, technology and licensing
arrangements;

 

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(h) may enter to transactions with persons who have entered into an agreement,
contract or arrangement with Borrower or any of its Restricted Subsidiaries to
manage, own or operate a Gaming Facility because Borrower and its Restricted
Subsidiaries have not received the requisite Gaming Approvals or are otherwise
not permitted to manage, own or operate such Gaming Facility under applicable
Gaming Laws; provided that such transactions shall have been approved by a
majority of the directors of Borrower;

(i) may enter into transactions with any Person, which is an Affiliate solely
due to a director or directors of such Person (or a parent company of such
Person) also being a director or directors of Borrower;

(j) may enter into transactions with a Person who is not an Affiliate
immediately before the consummation of such transaction that becomes an
Affiliate as a result of such transaction; and

(k) may issue Equity Interests in Borrower to any Person.

SECTION 10.08. [Reserved].

SECTION 10.09. Certain Payments of Indebtedness; Amendments to Certain
Agreements.

(a) None of Borrower or any of its Restricted Subsidiaries will, nor will they
permit any Restricted Subsidiary to voluntarily prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in any
manner (it being understood that payments of regularly scheduled principal and
interest shall be permitted) any Disqualified Capital Stock or Other Junior
Indebtedness or make any payment in violation of any subordination terms or
intercreditor agreement applicable to any such Indebtedness (such payments,
“Junior Prepayments”), except:

(i) Borrower and its Restricted Subsidiaries may make Junior Prepayments in an
aggregate amount not to exceed the Initial Restricted Payment Base Amount as of
such date;

(ii) so long as (i) immediately before and after giving effect thereto no Event
of Default has occurred and is continuing and (ii) except for Junior Prepayments
made in reliance on clauses (e), (f) or (g) of the definition of “Available
Amount”, after giving effect thereto the Consolidated Total Net Leverage Ratio
will not exceed 5.10 to 1.00 calculated on a Pro Forma Basis as of the most
recent Calculation Date, Borrower and its Restricted Subsidiaries may make
Junior Prepayments in an aggregate amount not to exceed the Available Amount
determined at the time such Junior Prepayment is made;

(iii) so long as (i) immediately before and after giving effect thereto no Event
of Default has occurred and is continuing and (ii) after giving effect thereto
the Consolidated Total Net Leverage Ratio will not exceed 4.35 to 1.00
calculated on a Pro Forma Basis as of the most recent Calculation Date, Borrower
and its Restricted Subsidiaries may make additional Junior Prepayments;

(iv) a Permitted Refinancing of any such Indebtedness (including through
exchange offers and similar transactions);

(v) the conversion of any such Indebtedness to Equity Interests (or exchange of
any such Indebtedness for Equity Interests) of Borrower or any direct or
indirect parent of Borrower (other than Disqualified Capital Stock);

 

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(vi) with respect to intercompany subordinated indebtedness, to the extent
consistent with the subordination terms thereof;

(vii) exchanges of Indebtedness issued in private placements and resold in
reliance on Regulation S or Rule 144A for Indebtedness having substantially
equivalent terms pursuant to customary exchange offers;

(viii) prepayment, redemption, purchase, defeasance or satisfaction of
Indebtedness of Persons acquired pursuant to, or Indebtedness assumed in
connection with, Permitted Acquisitions or Investments (including any other
Acquisition) not prohibited by this Agreement;

(ix) Junior Prepayments made pursuant to Section 2.09(b)(ii);

(x) Junior Prepayments in respect of intercompany Indebtedness owing to Borrower
or its Restricted Subsidiaries will be permitted;

(xi) prepayments, redemptions, purchases, defeasance or satisfaction of
Disqualified Capital Stock with the proceeds of any issuance of Disqualified
Capital Stock permitted to be issued hereunder or in exchange for Disqualified
Capital Stock or other Equity Interests permitted to be issued hereunder; and

(xii) Borrower and its Restricted Subsidiaries may make Junior Prepayments in an
aggregate amount not to exceed an amount equal to the amount of Excluded
Contributions previously received and that Borrower elects to apply under this
clause (xii) and do not increase the Available Amount.

(b) Borrower shall not, and shall not permit any Restricted Subsidiary to amend,
modify or change in any manner adverse to the interests of the Lenders in any
material respect any term or condition of any Other Junior Indebtedness
Documentation unless such amendment, modification or change would qualify as a
Permitted Refinancing of such Other Junior Indebtedness.

SECTION 10.10. Limitation on Certain Restrictions Affecting Subsidiaries. None
of Borrower or any of its Restricted Subsidiaries shall, directly or indirectly,
create any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary (other than any Foreign Subsidiary or Immaterial
Subsidiary) of Borrower to (i) pay dividends or make any other distributions on
such Restricted Subsidiary’s Equity Interests or any other interest or
participation in its profits owned by Borrower or any of its Restricted
Subsidiaries, or pay any Indebtedness or any other obligation owed to Borrower
or any of its Restricted Subsidiaries, (ii) make Investments in or to Borrower
or any of its Restricted Subsidiaries, (iii) transfer any of its Property to
Borrower or any of its Restricted Subsidiaries or (iv) in the case of any
Guarantor, guarantee the Obligations hereunder or, in the case of any Credit
Party, subject its portion of the Collateral to the Liens securing the
Obligations in favor of the Secured Parties, except that each of the following
shall be permitted:

(a) any such encumbrances or restrictions existing under or by reason of
(x) applicable Law (including any Gaming Law and any regulations, order or
decrees of any Gaming Authority or other applicable Governmental Authority), (y)
the Credit Documents or (z) the First Lien Credit Documents and any Permitted
Refinancing thereof (so long as the restrictions in any such Permitted
Refinancing, taken as a whole, are no more restrictive in any material respect
to Borrower and its Restricted Subsidiaries than those in the Second Lien Credit
Documents on the Closing Date);

 

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(b) restrictions on the transfer of Property, or the granting of Liens on
Property, in each case, subject to Permitted Liens;

(c) customary restrictions on subletting or assignment of any lease or sublease
governing a leasehold interest of any Company;

(d) restrictions on the transfer of any Property, or the granting of Liens on
Property, subject to a contract with respect to an Asset Sale or other transfer,
sale, conveyance or disposition permitted under this Agreement;

(e) restrictions contained in the existing Indebtedness listed on Schedule 10.01
and Permitted Refinancings thereof, provided, that the restrictive provisions in
any such Permitted Refinancing, taken as a whole, are not materially more
restrictive than the restrictive provisions in the Indebtedness being
refinanced;

(f) restrictions contained in Indebtedness of Persons acquired pursuant to, or
assumed in connection with, Permitted Acquisitions or other Acquisitions not
prohibited hereunder after the Closing Date and Permitted Refinancings thereof,
provided, that the restrictive provisions in any such Permitted Refinancing,
taken as a whole, are not materially more restrictive than the restrictive
provisions in the Indebtedness being refinanced and such restrictions are
limited to the Persons or assets being acquired and of the Subsidiaries of such
Persons and their assets;

(g) with respect to clauses (i), (ii) and (iii) above, restrictions contained in
any Indebtedness permitted hereunder, in each case, taken as a whole, to the
extent not materially more restrictive than those contained in this Agreement;

(h) with respect to clauses (i), (ii) and (iii) above, restrictions contained in
any Ratio Debt and Permitted Refinancings thereof, or any other Indebtedness
permitted hereunder, in each case, taken as a whole, to the extent not
materially more restrictive than those contained in this Agreement;

(i) customary restrictions in joint venture arrangements or management
contracts; provided, that such restrictions are limited to the assets of such
joint ventures and the Equity Interests of the Persons party to such joint
venture arrangements or the assignment of such management contract, as
applicable;

(j) customary non-assignment provisions or other customary restrictions arising
under licenses, leases and other contracts entered into in the ordinary course
of business; provided, that such restrictions are limited to the assets subject
to such licenses, leases and contracts and the Equity Interests of the Persons
party to such licenses and contracts;

(k) restrictions contained in Indebtedness of Foreign Subsidiaries incurred
pursuant to Section 10.01 and Permitted Refinancings thereof; provided that such
restrictions apply only to the Foreign Subsidiaries incurring such Indebtedness
and their Subsidiaries (and the assets thereof and Equity Interests in such
Foreign Subsidiaries);

(l) restrictions contained in Indebtedness used to finance, or incurred for the
purpose of financing, Expansion Capital Expenditures and/or Development Projects
and Permitted Refinancings thereof, provided, that such restrictions apply only
to the asset (or the Person owning such asset) being financed pursuant to such
Indebtedness; and

 

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(m) restrictions contained in subordination provisions applicable to
intercompany debt owed by the Credit Parties; provided, that such intercompany
debt is subordinated to the Obligations on terms at least as favorable to the
Lenders as the subordination of such intercompany debt to any other obligations.

SECTION 10.11. Limitation on Lines of Business. Neither Borrower nor any
Restricted Subsidiary shall directly or indirectly engage to any material extent
(determined on a consolidated basis) in any line or lines of business activity
other than Permitted Business.

SECTION 10.12. Limitation on Changes to Fiscal Year. Neither Borrower nor any
Restricted Subsidiary shall change its fiscal year end to a date other than
December 31 of each year (provided that any Restricted Subsidiary acquired or
formed, or Person designated as an Unrestricted Subsidiary, in each case, after
the Closing Date may change its fiscal year to match the fiscal year of
Borrower).

ARTICLE XI.

EVENTS OF DEFAULT

SECTION 11.01. Events of Default. If one or more of the following events (herein
called “Events of Default”) shall occur and be continuing:

(a) any representation or warranty made or deemed made by or on behalf of
Borrower or any other Credit Party pursuant to any Credit Document or the
borrowings hereunder, or any representation, warranty or statement of fact made
or deemed made by or on behalf of Borrower or any other Credit Party in any
report, certificate, financial statement or other instrument furnished pursuant
to any Credit Document, shall prove to have been false or misleading (i) in any
material respect, if such representation and warranty is not qualified as to
“materiality,” “Material Adverse Effect” or similar language, or (ii) in any
respect, if such representation and warranty is so qualified, in each case when
such representation or warranty is made, deemed made or furnished;

(b) default shall be made in the payment of (i) any principal of any Loan when
and as the same shall become due and payable (whether at the stated maturity
upon prepayment or repayment or by acceleration thereof or otherwise) or
(ii) any interest on any Loans when and as the same shall become due and
payable, and such default under this clause (ii) shall continue unremedied for a
period of five (5) Business Days;

(c) default shall be made in the payment of any fee or any other amount (other
than an amount referred to in (b) above) due under any Credit Document, when and
as the same shall become due and payable, and such default shall continue
unremedied for a period of five (5) Business Days;

(d) default shall be made in the due observance or performance by Borrower or
any Restricted Subsidiary of any covenant, condition or agreement contained in
Section 9.01(a) (with respect to Borrower only) or 9.04(d) or in Article X;

(e) default shall be made in the due observance or performance by Borrower or
any of the Restricted Subsidiaries of any covenant, condition or agreement
contained in any Credit Document (other than those specified in
Section 11.01(b), 11.01(c) or 11.01(d)) and, unless such default has been
waived, such default shall continue unremedied for a period of thirty (30) days
after the earlier of (i) written notice thereof from Administrative Agent to
Borrower and (ii) a Responsible Officer of Borrower obtaining knowledge thereof;

 

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(f) Borrower or any of the Restricted Subsidiaries shall (i) fail to pay any
principal or interest, regardless of amount, due in respect of any Indebtedness
(other than the Obligations), when and as the same shall become due and payable
(after giving effect to any applicable grace period), or (ii) fail to observe or
perform any other term, covenant, condition or agreement contained in any
agreement or instrument evidencing or governing any such Indebtedness or any
event or condition occurs, if the effect of any failure or occurrence referred
to in this clause (ii) is to cause, or to permit the holder or holders of such
Indebtedness or a trustee on its or their behalf (with or without the giving of
notice but giving effect to applicable grace periods) to cause, such
Indebtedness (other than Qualified Contingent Obligations) to become due, or to
be repurchased, prepaid, defeased or redeemed (automatically or otherwise) or an
offer to repurchase, prepay, defease or redeem such Indebtedness to be made
prior to its stated maturity; provided, however, that (x) clauses (i) and
(ii) shall not apply to any offer to repurchase, prepay or redeem Indebtedness
of a Person acquired in an Acquisition permitted hereunder, to the extent such
offer is required as a result of, or in connection with, such Acquisition,
(y) any event or condition causing or permitting the holders of any Indebtedness
to cause such Indebtedness to be converted into Qualified Capital Stock
(including any such event or condition which, pursuant to its terms may, at the
option of Borrower, be satisfied in cash in lieu of conversion into Qualified
Capital Stock) shall not constitute an Event of Default pursuant to this
paragraph (f) and (z) it shall not constitute an Event of Default pursuant to
this paragraph (f) unless the aggregate amount of all such Indebtedness referred
to in clauses (i) and (ii) exceeds $30.0 million at any one time;

(g) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed in a court of competent jurisdiction in either case under the
Bankruptcy Code or any other federal, state or foreign bankruptcy, insolvency,
receivership or similar law, in each case seeking (i) relief in respect of
Borrower or any of the Restricted Subsidiaries (other than any Subject
Subsidiary), or of a substantial part of the property or assets of Borrower or
any of the Restricted Subsidiaries (other than any Subject Subsidiary); (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for Borrower or any of the Restricted Subsidiaries (other than
any Subject Subsidiary) or for a substantial part of the property or assets of
Borrower or any of the Restricted Subsidiaries (other than any Subject
Subsidiary); or (iii) the winding-up or liquidation of Borrower or of any of the
Restricted Subsidiaries (other than any Subject Subsidiary); and such proceeding
or petition shall continue undismissed for 60 days or an order or decree
approving or ordering any of the foregoing shall be entered;

(h) Borrower or any of the Restricted Subsidiaries (other than any Subject
Subsidiary) shall (i) voluntarily commence any proceeding or file any petition
seeking relief under the Bankruptcy Code or any other federal, state or foreign
bankruptcy, insolvency, receivership or similar law; (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or the filing of any petition described in Section 11.01(g); (iii)
apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for Borrower or any of the
Restricted Subsidiaries (other than any Subject Subsidiary) or for a substantial
part of the property or assets of Borrower or any of the Restricted Subsidiaries
(other than any Subject Subsidiary) in any proceeding under the Bankruptcy Code
or any other federal, state or foreign bankruptcy, insolvency, receivership, or
similar law; (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding; (v) make a general assignment
for the benefit of creditors; (vi) become unable, admit in writing its inability
or fail generally to pay its debts as they become due; (vii) take any action for
the purpose of effecting any of the foregoing; or (viii) wind up or liquidate
(except as permitted hereunder);

(i) one or more judgments for the payment of money in an aggregate amount in
excess of $30.0 million (to the extent not covered by third party insurance)
shall be rendered against Borrower or any of the Restricted Subsidiaries (other
than any Subject Subsidiary) or any combination thereof and the same shall
remain undischarged for a period of 60 consecutive days during which execution
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effectively stayed, or any action (to the extent such action is not effectively
stayed) shall be legally taken by a judgment creditor to levy upon assets or
properties of Borrower or any of the Restricted Subsidiaries to enforce any such
judgment;

(j) an ERISA Event shall have occurred that, when taken together with all other
such ERISA Events, would reasonably be expected to result in a Material Adverse
Effect;

(k) with respect to any material Collateral, any security interest and Lien
purported to be created by the applicable Security Document shall cease to be in
full force and effect, or shall cease to give Collateral Agent, for the benefit
of the Secured Parties, the first priority Liens and rights, powers and
privileges in each case purported to be created and granted under such Security
Document in favor of Collateral Agent, or shall be asserted by any Credit Party
or any Affiliate thereof not to be a valid, perfected security interest in or
Lien on the Collateral covered thereby, in each case, except (x) to the extent
that any such perfection or priority is not required pursuant to this Agreement
or the Security Documents or any loss thereof results from the failure of the
Collateral Agent to maintain possession of certificates actually delivered to it
representing securities pledged under the Security Documents or to file Uniform
Commercial Code continuation statements and (y) as to Collateral consisting of
Real Property to the extent that such losses are covered by a lender’s title
insurance policy and such insurer has not denied coverage;

(l) any Guarantee shall cease to be in full force and effect or any of the
Guarantors or Affiliates thereof repudiates, or attempts to repudiate, any of
its obligations under any of the Guarantees (except to the extent such Guarantee
ceases to be in effect in connection with any transaction permitted pursuant to
Sections 9.12 or 10.05);

(m) any Credit Document or any material provisions thereof shall at any time and
for any reason be declared by a court of competent jurisdiction to be null and
void, or a proceeding shall be commenced by any Credit Party seeking to
establish the invalidity or unenforceability thereof (exclusive of questions of
interpretation of any provision thereof), or any Credit Party shall repudiate or
deny that it has any liability or obligation for the payment of principal or
interest purported to be created under any Credit Document;

(n) there shall have occurred a Change of Control;

(o) there shall have occurred a License Revocation by any Gaming Authority in
one or more jurisdictions in which Borrower or any of its Restricted
Subsidiaries owns or operates Gaming Facilities, which License Revocation (in
the aggregate with any other License Revocations then in existence) relates to
operations of Borrower and/or the Restricted Subsidiaries that in the most
recent Test Period accounted for ten percent (10%) or more of the Consolidated
EBITDA of Borrower and its Restricted Subsidiaries; provided, however, that such
License Revocation continues for at least ninety (90) consecutive days after the
earlier of (x) the date of cessation of the affected operations as a result of
such License Revocation and (y) the date that none of Borrower, nor any of its
Restricted Subsidiaries nor the Lenders receive the net cash flows generated by
any such operations; or

(p) the provisions of any Pari Passu Intercreditor Agreement or First
Lien/Second Lien Intercreditor Agreement shall, in whole or in part, following
such Pari Passu Intercreditor Agreement or First Lien/Second Lien Intercreditor
Agreement being entered into, terminate, cease to be effective or cease to be
legally valid, binding and enforceable against the Persons party thereto, except
in accordance with its terms;

 

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then, and in every such event (other than an event described in Section 11.01(g)
or 11.01(h) with respect to Borrower), and at any time thereafter during the
continuance of such event, Administrative Agent, at the request of the Required
Lenders, shall, by notice to Borrower, take any or all of the following actions,
at the same or different times: (i) terminate forthwith the Commitments,
(ii) declare the Loans then outstanding to be forthwith due and payable in whole
or in part, whereupon the principal of the Loans so declared to be due and
payable, together with accrued interest thereon and any unpaid accrued fees and
all other liabilities and Obligations of Borrower accrued hereunder and under
any other Credit Document, shall become forthwith due and payable, without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by Borrower, anything contained herein or in any other
Credit Document to the contrary notwithstanding; and (iii) exercise any other
right or remedy provided under the Credit Documents or at law or in equity; and
in any event described in Section 11.01(g) or 11.01(h) above with respect to
Borrower, the Commitments shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon and any unpaid
accrued fees and all other liabilities and Obligations of Borrower accrued
hereunder and under any other Credit Document, shall automatically become due
and payable, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by Borrower, anything contained
herein or in any other Credit Document to the contrary notwithstanding.

SECTION 11.02. Application of Proceeds. Subject to the First Lien/Second Lien
Intercreditor Agreement, the proceeds received by Collateral Agent in respect of
any sale of, collection from or other realization upon all or any part of the
Collateral pursuant to the exercise by Collateral Agent of its remedies, or
otherwise received after acceleration of the Loans, shall be applied, in full or
in part, together with any other sums then held by Collateral Agent pursuant to
this Agreement, promptly by Collateral Agent as follows:

(a) First, to the payment of all reasonable costs and expenses, fees,
commissions and taxes of such sale, collection or other realization including
compensation to Administrative Agent and Collateral Agent and their respective
agents and counsel, and all expenses, liabilities and advances made or incurred
by Administrative Agent or Collateral Agent in connection therewith and all
amounts for which Administrative Agent or Collateral Agent, as applicable is
entitled to indemnification pursuant to the provisions of any Credit Document;

(b) Second, to the payment of all other reasonable costs and expenses of such
sale, collection or other realization and of any receiver of any part of the
Collateral appointed pursuant to the applicable Security Documents including
compensation to the other Secured Parties and their agents and counsel and all
costs, liabilities and advances made or incurred by the other Secured Parties in
connection therewith;

(c) Third, without duplication of amounts applied pursuant to clauses (a) and
(b) above, to the indefeasible payment in full in cash, pro rata, of the
Obligations; and

(d) Fourth, the balance, if any, to the Person lawfully entitled thereto
(including the applicable Credit Party or its successors or assigns) or as a
court of competent jurisdiction may direct.

In the event that any such proceeds are insufficient to pay in full the items
described in clauses (a) through (c) of this Section 11.02, the Credit Parties
shall remain liable, jointly and severally, for any deficiency.

 

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ARTICLE XII.

AGENTS

SECTION 12.01. Appointment. Each of the Lenders hereby irrevocably appoints
Credit Suisse to act on its behalf as Administrative Agent and Collateral Agent
hereunder and under the other Credit Documents (including as “trustee” or
“mortgage trustee” under the Ship Mortgages), and authorizes Administrative
Agent and Collateral Agent to take such actions on its behalf and to exercise
such powers as are delegated to Administrative Agent or Collateral Agent by the
terms hereof or thereof, together with such actions and powers as are reasonably
incidental thereto, including, in accordance with regulatory requirements of any
Gaming Authority consistent with the intents and purposes of this Agreement and
the other Credit Documents. Credit Suisse is hereby appointed Auction Manager
hereunder, and each Lender hereby authorizes the Auction Manager to act as its
agent in accordance with the terms hereof and of the other Credit Documents;
provided, that Borrower shall have the right to select and appoint a replacement
Auction Manager from time to time by written notice to Administrative Agent, and
any such replacement shall also be so authorized to act in such capacity. Each
Lender agrees that the Auction Manager shall have solely the obligations in its
capacity as the Auction Manager as are specifically described in this Agreement
and shall be entitled to the benefits of Article XII, as applicable. Each of the
Lenders hereby irrevocably authorize each of the Agents (other than
Administrative Agent, Collateral Agent and the Auction Manager) to take such
action on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to such Agent by the terms of this Agreement and the other Credit
Documents, together with such other powers as are reasonably incidental thereto.
The provisions of this Article are solely for the benefit of the Agents and the
Lenders, and neither Borrower nor any other Credit Party shall have rights as a
third party beneficiary of any of the provisions of this Article XII, except to
the extent set forth in this Section 12.01, Section 12.06 and Section 12.07(b).
It is understood and agreed that the use of the term “agent” herein or in any
other Credit Documents (or any other similar term) with reference to any Agent
is not intended to connote any fiduciary or other implied (or express)
obligations arising under agency doctrine of any applicable Law. Instead such
term is used as a matter of market custom, and is intended to create or reflect
only an administrative relationship between contracting parties. Each reference
in this Article XII to Collateral Agent shall include Collateral Agent in its
capacity as “trustee” or “mortgage trustee” under the Ship Mortgages.

SECTION 12.02. Rights as a Lender. Any Person serving as an Agent hereunder
shall have the same rights and powers in its capacity as a Lender (if
applicable) as any other Lender and may exercise the same as though it were not
an Agent, and the term “Lender” or “Lenders” shall, unless otherwise expressly
indicated or unless the context otherwise requires, include the Person serving
as such Agent hereunder in its individual capacity. Such Person and its
Affiliates may accept deposits from, lend money to, own securities of, act as
the financial advisor or in any other advisory capacity for and generally engage
in any kind of business with Borrower or any Subsidiary or other Affiliate
thereof as if such Person were not an Agent hereunder and without any duty to
account therefor to the Lenders.

SECTION 12.03. Exculpatory Provisions. No Agent shall have any duties or
obligations except those expressly set forth herein and in the other Credit
Documents, and each Agent’s duties hereunder shall be administrative in nature.
Without limiting the generality of the foregoing, no Agent:

(a) shall be subject to any fiduciary or other implied duties with respect to
any Credit Party, any Lender or any other Person, regardless of whether a
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(b) shall have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Credit Documents that the Agent is required
to exercise as directed in writing by the Required Lenders (or such other number
or percentage of the Lenders as shall be expressly provided for herein or in the
other Credit Documents), provided that no Agent shall be required to take any
action that, in its opinion or the opinion of its counsel, may expose such Agent
to liability or that is contrary to any Credit Document or applicable law,
including for the avoidance of doubt any action that may be in violation of the
automatic stay under any Debtor Relief Law or that may effect a forfeiture,
modification or termination of property of a Defaulting Lender in violation of
any Debtor Relief Law; and

(c) shall, except as expressly set forth herein and in the other Credit
Documents, have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to any of Borrower or any of its respective
Affiliates that is communicated to or obtained by the Person serving as such
Agent or any of its Affiliates in any capacity.

No Agent shall be liable for any action taken or not taken by it (i) with the
consent or at the request of the Required Lenders (or, such other number or
percentage of the Lenders as shall be necessary, or as Administrative Agent
shall believe in good faith shall be necessary, under the circumstances as
provided in Sections 11.01 and 13.04) or (ii) in the absence of its own gross
negligence or willful misconduct as determined by a court of competent
jurisdiction by final and non-appealable judgment. No Agent shall be deemed to
have knowledge of any Default or Event of Default unless and until notice
describing such Default is given in writing to such Agent by Borrower or a
Lender.

No Agent shall be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or any other Credit Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein
or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Credit Document or any
other agreement, instrument or document, (v) the satisfaction of any condition
set forth in Article VII or elsewhere herein, other than to confirm receipt of
items expressly required to be delivered to such Agent or (vi) any
representation or warranty regarding the existence, value or collectability of
the Collateral, the existence, priority or perfection of the Collateral Agent’s
Lien thereon, or any certificate prepared by any Credit Party in connection
therewith, nor shall any Agent be responsible or liable to the Lenders for any
failure to monitor or maintain any portion of the Collateral.

Administrative Agent shall not be responsible or have any liability for, or have
any duty to ascertain, inquire into, monitor or enforce, compliance with the
provisions hereof relating to Disqualified Lenders. Without limiting the
generality of the foregoing, Administrative Agent shall not (x) be obligated to
ascertain, monitor or inquire as to whether any Lender or participant or
prospective Lender or participant is a Disqualified Lender or (y) have any
liability with respect to or arising out of any assignment or participation of
Loans or Commitments, or disclosure of confidential information, to any
Disqualified Lender. Administrative Agent does not warrant, nor accept
responsibility, nor shall Administrative Agent have any liability with respect
to the administration, submission or any other matter related to the rates in
the definition of “LIBO Rate” or with respect to any comparable or successor
rate thereto.

Each of the Lenders (and each Secured Party by accepting the benefits of the
Collateral) acknowledges that Administrative Agent and/or Collateral Agent may
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classes of indebtedness under the Pari Passu Intercreditor Agreement and the
First Lien/Second Lien Intercreditor Agreement.

SECTION 12.04. Reliance by Agents.    Each Agent shall be entitled to rely upon,
and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing
(including any electronic message, Internet or intranet website posting or other
distribution) believed by it to be genuine and to have been signed, sent or
otherwise authenticated by the proper Person. Each Agent also may rely upon any
statement made to it orally or by telephone and believed by it to have been made
by the proper Person, and shall not incur any liability for relying thereon. In
determining compliance with any condition hereunder to the making of a Loan that
by its terms must be fulfilled to the satisfaction of a Lender, each Agent may
presume that such condition is satisfactory to such Lender unless such Agent
shall have received notice to the contrary from such Lender prior to the making
of such Loan. Each Agent may consult with legal counsel (who may be counsel for
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.

SECTION 12.05. Delegation of Duties. Each Agent may perform any and all of its
duties and exercise its rights and powers hereunder or under any other Credit
Document by or through any one or more sub agents appointed by such Agent. Each
Agent and any such sub agent may perform any and all of its duties and exercise
its rights and powers by or through their respective Related Parties. The
exculpatory provisions of this Article shall apply to any such sub agent and to
the Related Parties of each Agent and any such sub agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as an Agent. No Agent shall
be responsible for the negligence or misconduct of any sub-agents except to the
extent that a court of competent jurisdiction determines in a final and
non-appealable judgment that an Agent acted with gross negligence, bad faith or
willful misconduct in the selection of such sub-agents.

SECTION 12.06. Resignation of Administrative Agent and Collateral Agent

(a) Administrative Agent and Collateral Agent may at any time give notice of
their resignation to the Lenders and Borrower. Upon receipt of any such notice
of resignation, the Required Lenders shall have the right, with the prior
written consent of Borrower (unless an Event of Default specified in
Section 11.01(b) or 11.01(c) or an Event of Default specified in
Section 11.01(g) or 11.01(h) with respect to Borrower has occurred and is
continuing) to appoint a successor, which shall be a bank with an office in the
United States, or an Affiliate of any such bank with an office in the United
States. If no such successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days after the
retiring Administrative Agent and Collateral Agent gives notice of their
resignation (or such earlier day as shall be agreed by the Required Lenders and
Borrower (unless an Event of Default specified in Section 11.01(b) or 11.01(c)
or an Event of Default specified in Section 11.01(g) or 11.01(h) with respect to
Borrower has occurred and is continuing)) (the “Resignation Effective Date”),
then the retiring Administrative Agent and Collateral Agent may (but shall not
be obligated to) on behalf of the Lenders, appoint a successor Administrative
Agent and Collateral Agent meeting the qualifications set forth above. Whether
or not a successor has been appointed, such resignation shall become effective
in accordance with such notice on the Resignation Effective Date.

(b) If the Person serving as Administrative Agent and Collateral Agent is a
Defaulting Lender pursuant to clause (iii) of the definition thereof, the
Required Lenders may, to the extent permitted by applicable law, by notice in
writing to Borrower and such Person remove such Person as Administrative Agent
and Collateral Agent and, in consultation with Borrower, appoint a successor. If
no such successor shall have been so appointed by the Required Lenders and shall
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appointment within 30 days (or such earlier day as shall be agreed by the
Required Lenders) (the “Removal Effective Date”), then such removal shall
nonetheless become effective in accordance with such notice on the Removal
Effective Date.

(c) With effect from the Resignation Effective Date or the Removal Effective
Date (as applicable) (1) the retiring or removed Administrative Agent and
Collateral Agent shall be discharged from its duties and obligations hereunder
and under the other Credit Documents (except that in the case of any collateral
security held by Administrative Agent or Collateral Agent on behalf of the
Secured Parties under any of the Credit Documents, the retiring or removed
Administrative Agent or Collateral Agent, as applicable, shall continue to hold
such collateral security until such time as a successor Administrative Agent and
Collateral Agent is appointed) and (2) except for any indemnity payments or
other amounts then owed to the retiring or removed Administrative Agent or
Collateral Agent, all payments, communications and determinations provided to be
made by, to or through Administrative Agent or Collateral Agent shall instead be
made by or to each Secured Party directly, until such time, if any, as the
Required Lenders appoint a successor Administrative Agent and Collateral Agent
as provided for above. Upon the acceptance of a successor’s appointment as
Administrative Agent and Collateral Agent hereunder, such successor shall
succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring (or removed) Administrative Agent and Collateral Agent
(other than any rights to indemnity payments or other amounts owed to the
retiring or removed Administrative Agent or Collateral Agent as of the
Resignation Effective Date or the Removal Effective Date, as applicable), and
the retiring or removed Administrative Agent and Collateral Agent shall be
discharged from all of its duties and obligations hereunder or under the other
Credit Documents (if not already discharged therefrom as provided above in this
Section). The fees payable by Borrower to a successor Administrative Agent and
Collateral Agent shall be the same as those payable to its predecessor unless
otherwise agreed between Borrower and such successor. After the retiring or
removed Administrative Agent’s and Collateral Agent’s resignation or removal
hereunder and under the other Credit Documents, the provisions of this Article
and Section 13.03 shall continue in effect for the benefit of such retiring or
removed Administrative Agent and Collateral Agent, their sub agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while the retiring or removed Administrative Agent and
Collateral Agent was acting as Administrative Agent or Collateral Agent.

(d) To the extent required by applicable Gaming Laws or the conditions of any
Gaming Approval, Administrative Agent and Collateral Agent shall notify the
applicable Gaming Authorities of any change in the Administrative Agent or
Collateral Agent. Borrower shall provide advice and assistance to Administrative
Agent and Collateral Agent in making such notifications.

SECTION 12.07. Nonreliance on Agents and Other Lenders.

(a) Each Lender acknowledges that it has, independently and without reliance
upon any Agent or any other Lender or any of their Related Parties and based on
such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon any Agent or
any other Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Credit Document or any related agreement or any document furnished
hereunder or thereunder.

(b) Each Lender acknowledges that in connection with Borrower Loan Purchases,
(i) Borrower may purchase or acquire Term Loans hereunder from the Lenders from
time to time, subject to the restrictions set forth in the definition of
Eligible Assignee and in Section 13.05(d), (ii) Borrower

 

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currently may have, and later may come into possession of, information regarding
such Term Loans or the Credit Parties hereunder that is not known to such Lender
and that may be material to a decision by such Lender to enter into an
assignment of such Loans hereunder (“Excluded Information”), (iii) such Lender
has independently and without reliance on any other party made such Lender’s own
analysis and determined to enter into an assignment of such Loans and to
consummate the transactions contemplated thereby notwithstanding such Lender’s
lack of knowledge of the Excluded Information and (iv) Borrower shall have no
liability to such Lender, and such Lender hereby waives and releases, to the
extent permitted by law, any claims such Lender may have against Borrower, under
applicable laws or otherwise, with respect to the nondisclosure of the Excluded
Information; provided, however, that the Excluded Information shall not and does
not affect the truth or accuracy of the representations or warranties of
Borrower in the Standard Terms and Conditions set forth in the applicable
assignment agreement. Each Lender further acknowledges that the Excluded
Information may not be available to Administrative Agent, Auction Manager or the
other Lenders hereunder.

SECTION 12.08. Indemnification. The Lenders agree to reimburse and indemnify
each Agent in its capacity as such ratably according with its “percentage” as
used in determining the Required Lenders at such time or, if the Commitments
have terminated and all Loans have been repaid in full, as determined
immediately prior to such termination and repayment (with such “percentages” to
be determined as if there are no Defaulting Lenders), from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, reasonable expenses or disbursements of any kind whatsoever which
may at any time (including, without limitation, at any time following the
payment of the Obligations) be imposed on, incurred by or asserted against such
Agent in its capacity as such in any way relating to or arising out of this
Agreement or any other Credit Document, or any documents contemplated by or
referred to herein or the transactions contemplated hereby or any action taken
or omitted to be taken by such Agent under or in connection with any of the
foregoing, but only to the extent that any of the foregoing is not paid by
Borrower or any of its Subsidiaries; provided, however, that no Lender shall be
liable to any Agent for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements (x) resulting from the gross negligence, or willful
misconduct of such Agent (as determined by a court of competent jurisdiction in
a final and non-appealable decision) or (y) relating to or arising out of the
Commitment Letter. If any indemnity furnished to any Agent for any purpose
shall, in the opinion of such Agent be insufficient or become impaired, such
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this Section 12.08 shall survive the payment of all Obligations.

SECTION 12.09. No Other Duties. Anything herein to the contrary notwithstanding,
none of Administrative Agent, Collateral Agent or Lead Arrangers shall have any
powers, duties or responsibilities under this Agreement or any of the other
Credit Documents, except in its capacity, as applicable, as Administrative
Agent, Collateral Agent, the Auction Manager or a Lender hereunder.

SECTION 12.10. Holders. Administrative Agent may deem and treat the payee of any
Note as the owner thereof for all purposes hereof unless and until a written
notice of the assignment, transfer or endorsement thereof, as the case may be,
shall have been filed with Administrative Agent. Any request, authority or
consent of any Person or entity who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or indorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.

SECTION 12.11. Administrative Agent May File Proofs of Claim. In case of the
pendency of any proceeding under any Debtor Relief Law or any other judicial
proceeding relative to any Credit Party,

 

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Administrative Agent (irrespective of whether the principal of any Loan shall
then be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether Administrative Agent shall have made any demand on
Borrower) shall be entitled and empowered, by intervention in such proceeding or
otherwise:

(a) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans and all other Obligations that are
owing and unpaid and to file such other documents as may be necessary or
advisable in order to have the claims of the Secured Parties (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Secured Parties and their respective agents and counsel and all other
amounts due the Secured Parties under Sections 2.05 and 13.03) allowed in such
judicial proceeding; and

(b) to collect and receive any monies or other property payable or deliverable
on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender (and each Secured Party by accepting the benefits of the Collateral)
to make such payments to Administrative Agent and, in the event that
Administrative Agent shall consent to the making of such payments directly to
the Secured Parties, to pay to Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of Administrative
Agent and its agents and counsel, and any other amounts due Administrative Agent
under Sections 2.05 and 13.03.

Nothing contained herein shall be deemed to authorize Administrative Agent to
authorize or consent to or accept or adopt on behalf of any Secured Party any
plan of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Secured Party or to authorize Administrative
Agent to vote in respect of the claim of any Secured Party in any such
proceeding.

SECTION 12.12. Collateral Matters.

(a) Each Lender (and each other Secured Party by accepting the benefits of the
Collateral) authorizes and directs Collateral Agent to enter into the Security
Documents for the benefit of the Secured Parties and to hold and enforce the
Liens on the Collateral on behalf of the Secured Parties. Collateral Agent is
hereby authorized on behalf of all of the Lenders, without the necessity of any
notice to or further consent from any Lender, from time to time prior to an
Event of Default, to take any action with respect to any Collateral or Security
Documents which may be necessary to perfect and maintain perfected the security
interest in and liens upon the Collateral granted pursuant to the Security
Documents. The Lenders hereby authorize Collateral Agent to take the actions set
forth in Section 13.04(g). Upon request by Administrative Agent at any time, the
Lenders will confirm in writing Collateral Agent’s authority to release
particular types or items of Collateral pursuant to this Section 12.12.

(b) Collateral Agent shall have no obligation whatsoever to the Lenders, the
other Secured Parties or any other Person to assure that the Collateral exists
or is owned by any Credit Party or is cared for, protected or insured or that
the Liens granted to Collateral Agent pursuant to the applicable Security
Documents have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority, or to exercise
or to continue exercising at all or in any manner or under any duty of care,
disclosure or fidelity any of the rights, authorities and powers granted or
available to Collateral Agent in Section 12.01 or in this Section 12.12 or in
any of the Security Documents, it being understood and agreed that in respect of
the Collateral or any part thereof, or any act, omission or event

 

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related thereto, Collateral Agent may act in any manner it may deem appropriate,
in its sole discretion, given Collateral Agent’s own interest in the Collateral
or any part thereof as one of the Lenders and that Collateral Agent shall have
no duty or liability whatsoever to the Lenders or the other Secured Parties,
except for its gross negligence or willful misconduct (as determined by a court
of competent jurisdiction in a final and non-appealable decision).

SECTION 12.13. Withholding Tax. To the extent required by any applicable
Requirement of Law, an Agent may withhold from any payment to any Lender, an
amount equivalent to any applicable withholding Tax. Without limiting or
expanding the provisions of Section 5.06, each Lender shall indemnify the
relevant Agent, and shall make payable in respect thereof within thirty
(30) calendar days after demand therefor, against any and all Taxes and any and
all related losses, claims, liabilities and expenses (including fees, charges
and disbursements of any counsel for the Agent) incurred by or asserted against
the Agent by the IRS or any other Governmental Authority as a result of the
failure of the Agent to properly withhold Tax from amounts paid to or for the
account of any Lender for any reason (including, without limitation, because the
appropriate form was not delivered or not property executed, or because such
Lender failed to notify Administrative Agent of a change in circumstance that
rendered the exemption from, or reduction of withholding Tax ineffective). A
certificate as to the amount of such payment or liability delivered to any
Lender by Administrative Agent shall be conclusive absent manifest error. Each
Lender hereby authorizes Administrative Agent to set off and apply any and all
amounts at any time owing to such Lender under this Agreement or any other
Credit Document against any amount due Administrative Agent under this
Section 12.13. The agreements in this Section 12.13 shall survive the
resignation and/or replacement of Administrative Agent, any assignment of rights
by, or the replacement of, a Lender, and the repayment, satisfaction or
discharge of any Loans and all other amounts payable hereunder.

ARTICLE XIII.

MISCELLANEOUS

SECTION 13.01. Waiver. No failure on the part of Administrative Agent,
Collateral Agent or any other Secured Party to exercise and no delay in
exercising, and no course of dealing with respect to, any right, power or
privilege under any Credit Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power or privilege under any Credit
Document preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The remedies provided herein are cumulative and
not exclusive of any remedies provided by Law.

SECTION 13.02. Notices.

(a) General. Unless otherwise expressly provided herein, all notices and other
communications provided for hereunder shall be in writing (including by
facsimile or electronic mail). All such written notices shall be mailed
certified or registered mail, faxed or delivered to the applicable address,
telecopy or facsimile number or (subject to Section 13.02(b) below) electronic
mail address, and all notices and other communications expressly permitted
hereunder to be given by telephone shall be made to the applicable telephone
number, as follows:

(i) if to any Credit Party and any Agent, to the address, facsimile number,
electronic mail address or telephone number specified for such Person below its
name on the signature pages hereof;

 

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(ii) if to any other Lender, to the address, facsimile number, electronic mail
address or telephone number specified for such Person below its name on the
signature pages hereof or, in the case of any assignee Lender, the applicable
Assignment Agreement.

Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by facsimile shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient). Notices delivered through electronic communications to the extent
provided in Section 13.02(b) below, shall be effective as provided in such
Section 13.02(b).

(b) Electronic Communications. Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communication (including
e-mail and Internet or intranet websites) pursuant to procedures approved by
Administrative Agent; provided, however, that the foregoing shall not apply to
notices to any Lender pursuant to Article II, Article III or Article IV if such
Lender has notified Administrative Agent that it is incapable of receiving
notices under such Article by electronic communication. Each Agent or any Credit
Party may, in its discretion, agree to accept notices and other communications
to it hereunder by electronic communications pursuant to procedures approved by
it, provided that approval of such procedures may be limited to particular
notices or communications.

Unless Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an electronic mail address shall be deemed received upon
the sender’s receipt of an acknowledgement from the intended recipient (such as
by the “return receipt requested” function, as available, return electronic mail
address or other written acknowledgement); provided, however, that if such
notice or other communication is not sent during the normal business hours of
the recipient, such notice or communication shall be deemed to have been sent at
the opening of business on the next business day for the recipient, and
(ii) notices or communications posted to an Internet or intranet website shall
be deemed received upon the deemed receipt by the intended recipient at its
e-mail address (as described in the foregoing clause (i)) of notification that
such notice or communication is available and identifying the website address
therefor.

(c) Change of Address, Etc. Each Credit Party and each Agent may change its
respective address, facsimile number, electronic mail address or telephone
number for notices and other communications hereunder by notice to the other
parties hereto. Each other Lender may change its address, facsimile number,
electronic mail address or telephone number for notices and other communications
hereunder by notice to Borrower and Administrative Agent.

(d) Reliance by Agents and Lenders. Agents and the Lenders shall be entitled to
rely and act upon any notices (including telephonic Notices of Borrowing)
purportedly given by or on behalf of Borrower even if (i) such notices were not
made in a manner specified herein, were incomplete or were not preceded or
followed by any other form of notice specified herein, or (ii) the terms
thereof, as understood by the recipient, varied from any confirmation thereof.
Borrower shall indemnify each Indemnitee from all Losses resulting from the
reliance by such Indemnitee on each notice purportedly given by or on behalf of
Borrower (except to the extent resulting from such Indemnitee’s own gross
negligence, bad faith or willful misconduct or material breach of any Credit
Document) and believed by such Indemnitee in good faith to be genuine. All
telephonic notices to and other communications with Administrative Agent or
Collateral Agent may be recorded by Administrative Agent or Collateral Agent, as
the case may be, and each of the parties hereto hereby consents to such
recording.

 

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(e) The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM
LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF
ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT
PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event
shall any Agent or any of their respective Affiliates, directors, officers,
employees, counsel, agents, trustees, investment advisors and attorneys-in-fact
(collectively, the “Agent Parties”) have any liability to Borrower, any other
Credit Party, any Lender or any other Person for losses, claims, damages,
liabilities or expenses of any kind (whether in tort, contract or otherwise)
arising out of Borrower’s or Administrative Agent’s transmission of Borrower
Materials through the Internet, except to the extent that such losses, claims,
damages, liabilities or expenses are determined by a court of competent
jurisdiction by a final and non-appealable judgment to have resulted from the
gross negligence, bad faith or willful misconduct of, or material breach of any
Credit Document by, such Agent Party; provided however, that in no event shall
any Agent Party have any liability to Borrower, any other Credit Party, any
Lender or any other Person for indirect, special, incidental, consequential or
punitive damages (as opposed to direct or actual damages).

SECTION 13.03. Expenses, Indemnification, Etc.

(a) The Credit Parties, jointly and severally, agree to pay or reimburse:

(i) Agents for all of their reasonable and documented out-of-pocket costs and
expenses (including the reasonable fees, expenses and disbursements of Cahill
Gordon & Reindel LLP and one special gaming and local counsel in Nevada) in
connection with (1) the negotiation, preparation, execution and delivery of the
Credit Documents and the extension and syndication of credit (including the
Loans and Commitments) hereunder and (2) the negotiation, preparation, execution
and delivery of any modification, supplement, amendment or waiver of any of the
terms of any Credit Document (whether or not consummated or effective) requested
by the Credit Parties;

(ii) each Agent and each Lender for all reasonable and documented out-of-pocket
costs and expenses of such Agent or Lender (provided that any legal expenses
shall be limited to the reasonable fees, expenses and disbursements of one
primary legal counsel for Lenders and Agents selected by Administrative Agent
and of one special gaming and local counsel in each applicable jurisdiction
reasonably deemed necessary by Agents (and solely in the case of an actual or
perceived conflict of interest, where the Persons affected by such conflict
inform Borrower in writing of the existence of an actual or perceived conflict
of interest prior to retaining additional counsel, one additional of each such
counsel for each group of similarly situated Secured Parties)) in connection
with (1) any enforcement or collection proceedings resulting from any Default,
including all manner of participation in or other involvement with
(x) bankruptcy, insolvency, receivership, foreclosure, winding up or liquidation
proceedings, (y) judicial or regulatory proceedings and (z) workout,
restructuring or other negotiations or proceedings (whether or not the workout,
restructuring or transaction contemplated thereby is consummated), (2) following
the occurrence and during the continuance of an Event of Default, the
enforcement of any Credit Document, and (3) the enforcement of this
Section 13.03; and

 

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(iii) Administrative Agent or Collateral Agent, as applicable but without
duplication, for all reasonable and documented costs, expenses, assessments and
other charges (including reasonable fees and disbursements of one counsel in
each applicable jurisdiction) incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated by
any Credit Document or any other document referred to therein.

Without limiting the rights of any Agent under this Section 13.03(a), each
Agent, promptly after a request of Borrower from time to time, will advise
Borrower of an estimate of any amount anticipated to be incurred by such Agent
and reimbursed by Borrower under this Section 13.03(a).

(b) The Credit Parties, jointly and severally, hereby agree to indemnify each
Agent, each Lender and their respective Affiliates and their and their
respective Affiliates’, directors, trustees, officers, employees,
representatives, advisors, partners and agents (each, an “Indemnitee”) from, and
hold each of them harmless against, any and all Losses incurred by, imposed on
or asserted against any of them directly or indirectly arising out of or by
reason of or relating to the negotiation, execution, delivery, performance,
administration or enforcement of any Credit Document, any of the transactions
contemplated by the Credit Documents (including the Transactions), any breach by
any Credit Party of any representation, warranty, covenant or other agreement
contained in any Credit Document in connection with any of the Transactions, the
use or proposed use of any of the Loans or, the use of any collateral security
for the Obligations (including the exercise by any Agent or Lender of the rights
and remedies or any power of attorney with respect thereto or any action or
inaction in respect thereof), including all amounts payable by any Lender
pursuant to Section 12.08, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN
WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE
INDEMNITEE, but excluding (i) any such Losses arising from the gross negligence,
bad faith or willful misconduct or material breach of any Credit Documents by
such Indemnitee or its Related Indemnified Persons (as determined by a court of
competent jurisdiction in a final and non-appealable decision) and (ii) any such
Losses relating to any dispute between and among Indemnitees that does not
involve an act or omission by any Company or any of their respective Affiliates
(other than any claims against Administrative Agent, Collateral Agent, or any
other agent or bookrunner named on the cover page hereto, in each case, acting
in such capacities or fulfilling such roles); provided, however, this
Section 13.03(b) shall not apply with respect to Taxes other than any Taxes that
represent losses, claims, damages, etc. arising from any non-Tax claim. For
purposes of this Section 13.03(b), a “Related Indemnified Person” of an
Indemnitee means (1) any controlling person or controlled affiliate of such
Indemnitee, (2) the respective directors, officers, trustees, partners or
employees of such Indemnitee or any of its controlling persons or controlled
Affiliates and (3) the respective agents or advisors of such Indemnitee or any
of its controlling persons or controlled Affiliates, in the case of this clause
(3), acting at the instructions of such Indemnitee, controlling person or such
controlled Affiliate; provided that each reference to a controlled Affiliate or
controlling person in this sentence pertains to a controlled Affiliate or
controlling person involved in the performance of the Indemnitee’s obligations
under the facilities.

Without limiting the generality of the foregoing, the Credit Parties, jointly
and severally, will indemnify each Agent, each Lender and each other Indemnitee
from, and hold each Agent, each Lender and each other Indemnitee harmless
against, any Losses incurred by, imposed on or asserted against any of them
arising under any Environmental Law as a result of (i) the past, present or
future operations of any Company (or any predecessor-in-interest to any
Company), (ii) the past, present or future condition of any site or facility
owned, operated, leased or used at any time by any Company (or any such
predecessor-in-interest) to the extent such Losses arise from or relate to the
parties’ relationship under the Credit Documents (including the exercise or
remedies thereunder) or to (A) any Company’s (or such predecessor-in-interest’s)
ownership, operation, lease or use of such site or facility or (B) any aspect of

 

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the respective business or operations of any Company (or
predecessor-in-interest), and, in each case shall include, without limitation,
any and all such Losses for which any Company could be found liable, or
(iii) any Release or threatened Release of any Hazardous Materials at, on, under
or from any such site or facility to the extent such Losses arise from or relate
to the parties’ relationship under the Credit Documents (including the exercise
or remedies thereunder) or to (A) any Company’s (or such
predecessor-in-interest’s) ownership, operation, lease or use of such site or
facility or (B) any aspect of the respective business or operations of any
Company (or predecessor-in-interest), and, in each case shall include, without
limitation, any and all such Losses for which any Company could be found liable,
including any such Release or threatened Release that shall occur during any
period when any Agent or Lender shall be in possession of any such site or
facility following the exercise by such Agent or Lender, as the case may be, of
any of its rights and remedies hereunder or under any of the Security Documents;
provided, however, that the indemnity hereunder shall be subject to the
exclusions from indemnification set forth in the preceding sentence.

To the extent that the undertaking to indemnify and hold harmless set forth in
this Section 13.03 or any other provision of any Credit Document providing for
indemnification is unenforceable because it is violative of any Law or public
policy or otherwise, the Credit Parties, jointly and severally, shall contribute
the maximum portion that each of them is permitted to pay and satisfy under
applicable Law to the payment and satisfaction of all indemnified liabilities
incurred by any of the Persons indemnified hereunder.

To the fullest extent permitted by applicable Law, no party hereto shall assert,
and the parties hereto hereby waive, any claim against any Person, on any theory
of liability, for special, indirect, consequential or punitive damages (as
opposed to direct or actual damages) arising out of, in connection with, or as a
result of, this Agreement, any other Credit Document or any agreement or
instrument contemplated hereby, the transactions contemplated hereby or thereby,
any Loan or the use of the proceeds thereof; provided that nothing contained in
this sentence shall limit the Credit Parties’ indemnity and reimbursement
obligations to the extent set forth in this Section 13.03 (including the Credit
Parties’ indemnity and reimbursement obligations to indemnify the Indemnitees
for indirect, special, punitive or consequential damage that are included in any
third party claim in connection with which such Indemnitee is entitled to
indemnification hereunder). No Indemnitee referred to in subsection (b) above
shall be liable for any damages arising from the use by unintended recipients of
any information or other materials distributed to such unintended recipients by
such Indemnitee through telecommunications, electronic or other information
transmission systems in connection with this Agreement or the other Credit
Documents or the transactions contemplated hereby or thereby other than for
direct or actual damages resulting from the gross negligence, bad faith or
willful misconduct or material breach of any Credit Document by such Indemnitee
as determined by a final and non-appealable judgment of a court of competent
jurisdiction.

SECTION 13.04. Amendments and Waiver.

(a) Neither this Agreement nor any other Credit Document nor any terms hereof or
thereof may be amended, modified, changed or waived, unless such amendment,
modification, change or waiver is in writing signed by each of the Credit
Parties that is party thereto and the Required Lenders (or Administrative Agent
with the consent of the Required Lenders); provided, however, that no such
amendment, modification, change or waiver shall (and any such amendment,
modification, change or waiver set forth below in clauses (i) through (vi) of
this Section 13.04(a) shall only require the approval of the Agents and/or
Lenders whose consent is required therefor pursuant to such clauses):

 

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(i) extend the date for any scheduled payment of principal on any Loan or Note
or extend the termination date of any of the Commitments, or reduce the rate or
extend the time of payment of interest (other than as a result of any waiver of
the applicability of any post-default increase in interest rates) or fees
thereon, or forgive or reduce the principal amount thereof, without the consent
of each Lender directly and adversely affected thereby (it being understood that
the waiver of (or amendment to the terms of) any Default or Event of Default or
of any mandatory prepayment of the Loans or mandatory reduction in Commitments
shall not constitute a postponement of any date scheduled for the payment of
principal or interest or an extension or increase of any Commitment and any
amendment or modification to the financial definitions in this Agreement shall
not constitute a reduction in any rate of interest or fees for purposes of this
clause (i), notwithstanding the fact that such amendment or modification
actually results in such a reduction);

(ii) release (x) all or substantially all of the Collateral (except as provided
in the Security Documents) under all the Security Documents or (y) all or
substantially all of the Guarantors from the Guarantees (except as expressly
provided in this Agreement), without the consent of each Lender;

(iii) amend, modify, change or waive (x) any provision of Section 11.02 or this
Section 13.04 without the consent of each Lender, (y) any other provision of any
Credit Document or any other provision of this Agreement that expressly provides
that the consent of all Lenders or all affected Lenders is required, without the
consent of each Lender directly and adversely affected thereby or (z) any
provision of any Credit Document that expressly provides that the consent of the
Required Tranche Lenders of a particular Tranche is required, without the
consent of the Required Tranche Lenders of each Tranche (in each case, except
for technical amendments with respect to additional extensions of credit
(including Extended Term Loans) pursuant to this Agreement which afford the
benefits or protections to such additional extensions of credit of the type
provided to the Term Loans);

(iv) reduce the percentage specified in the definition of Required Lenders or
Required Tranche Lenders or otherwise amend the definition of Required Lenders
or Required Tranche Lenders without the consent of each Lender (provided that,
(x) no such consent shall be required for technical amendments with respect to
additional extensions of credit (including Extended Term Loans) pursuant to this
Agreement, and (y) with the consent of the Required Lenders, additional
extensions of credit pursuant to this Agreement may be included in the
determination of the Required Lenders and/or Required Tranche Lenders on
substantially the same basis as the extensions of Loans and Commitments are
included on the Closing Date);

(v) amend, modify, change or waive Section 4.02 or Section 4.07(b) in a manner
that would alter the pro rata sharing of payments required thereby, without the
consent of each Lender directly and adversely affected thereby (except for
technical amendments with respect to additional extensions of credit (including
Extended Term Loans) pursuant to this Agreement which afford the protections to
such additional extensions of credit of the type provided to the Term Loans); or

(vi) impose any greater restriction on the ability of any Lender under a Tranche
to assign any of its rights or obligations hereunder without the written consent
of the Required Tranche Lenders for such Tranche;

 

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provided, further, that no such amendment, modification, change or waiver shall
(A) increase the Commitments of any Lender over the amount thereof then in
effect without the consent of such Lender (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or Events of Default
or of a mandatory reduction in the total Commitments or a waiver of a mandatory
prepayment shall not constitute an increase of the Commitment of any Lender),
(B) without the consent of any applicable Agent, amend, modify, change or waive
any provision as same relates to the rights or obligations of such Agent or
(C) amend, modify, change or waive Section 2.10(b) in a manner that by its terms
adversely affects the rights in respect of prepayments due to Lenders holding
Loans of one Tranche differently from the rights of Lenders holding Loans of any
other Tranche without the prior written consent of the Required Tranche Lenders
of each adversely affected Tranche (such consent being in lieu of the consent of
the Required Lenders required above in this Section 13.04(a)) (except for
technical amendments with respect to additional extensions of credit pursuant to
this Agreement (including Extended Term Loans) so that such additional
extensions may share in the application of prepayments (or commitment
reductions) with any Tranche of Term Loans); provided, however, the Required
Lenders may waive, in whole or in part, any prepayment so long as the
application, as between Tranches, of any portion of such prepayment which is
still required to be made is not altered. Notwithstanding anything to the
contrary herein, no Defaulting Lender shall have any right to approve or
disapprove any amendment, waiver or consent hereunder, except that (x) the
Commitment of such Defaulting Lender may not be increased or extended without
the consent of such Defaulting Lender, (y) the principal and accrued and unpaid
interest of such Defaulting Lender’s Loans shall not be reduced or forgiven
(other than as a result of any waiver of the applicability of any post-default
increase in interest rates), nor shall the date for any scheduled payment of any
such amounts be postponed, without the consent of such Defaulting Lender (it
being understood that any amendment or modification to the financial definitions
in this Agreement shall not constitute a reduction in any rate of interest or
fees for purposes of this clause (y), notwithstanding the fact that such
amendment or modification actually results in such a reduction) and (z) any
waiver, amendment or modification requiring the consent of all Lenders or each
affected Lender that by its terms affects any Defaulting Lender more adversely
than other affected Lenders shall require the consent of such Defaulting Lender.

In addition, notwithstanding the foregoing, the Commitment Letter may only be
amended or changed, or rights or privileges thereunder waived, only by the
parties thereto in accordance with the respective provisions thereof.

(b) If, in connection with any proposed amendment, modification, change or
waiver of or to any of the provisions of this Agreement, the consent of the
Required Lenders (or in the case of a proposed amendment, modification, change
or waiver affecting a particular Class or Tranche, the Lenders holding a
majority of the Loans and Commitments with respect to such Class or Tranche) is
obtained but the consent of one or more of such other Lenders whose consent is
required is not obtained, then Borrower shall have the right, so long as all
non-consenting Lenders whose individual consent is required are treated as
described in either clause (A) or (B) below, to either:

(A) replace each such non-consenting Lender or Lenders (or, at the option of
Borrower, if such non-consenting Lender’s consent is required with respect to a
particular Class or Tranche of Loans (or related Commitments), to replace only
the Classes or Tranches of Commitments and/or Loans of such non-consenting
Lender with respect to which such Lender’s individual consent is required (such
Classes or Tranches, the “Affected Classes”)) with one or more Replacement
Lenders, so long as, at the time of such replacement, each such Replacement
Lender consents to the proposed amendment, modification, change or waiver;
provided, further, that (i) at the time

 

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of any such replacement, the Replacement Lender shall enter into one or more
Assignment Agreements (and with all fees payable pursuant to Section 13.05(b) to
be paid by the Replacement Lender) pursuant to which the Replacement Lender
shall acquire all of the Commitments and outstanding Loans of the Replaced
Lender (or, at the option of Borrower if the respective Lender’s consent is
required with respect to less than all Classes or Tranches of Loans (or related
Commitments), the Commitments and outstanding Loans of the Affected Classes),
(ii) at the time of any replacement, the Replaced Lender shall receive an amount
equal to the sum of (A) the principal of, and all accrued interest on, all
outstanding Loans of such Lender (other than any Loans not being acquired by the
Replacement Lender) and (B) all accrued, but theretofore unpaid, fees and other
amounts owing to the Lender with respect to the Loans being so assigned and
(iii) all obligations of Borrower owing to such Replaced Lender (other than
those specifically described in clause (ii) above in respect of Replaced Lenders
for which the assignment purchase price has been, or is concurrently being,
paid, and other than those relating to Loans or Commitments not being acquired
by the Replacement Lender, but including any amounts which would be paid to a
Lender pursuant to Section 5.05 if Borrower were prepaying a LIBOR Loan), as
applicable, shall be paid in full to such Replaced Lender, as applicable,
concurrently with such replacement. Upon the execution of the respective
Assignment Agreement, the payment of amounts referred to in clauses (i), (ii)
and (iii) above, as applicable, and the receipt of any consents that would be
required for an assignment of the subject Loans and Commitments to such
Replacement Lender in accordance with Section 13.05, the Replacement Lender, if
any, shall become a Lender hereunder and the Replaced Lender, as applicable,
shall cease to constitute a Lender hereunder and be released of all its
obligations as a Lender, except with respect to indemnification provisions
applicable to such Lender under this Agreement, which shall survive as to such
Lender and, in the case of any Replaced Lender, except with respect to Loans and
Commitments of such Replaced Lender not being acquired by the Replacement
Lender; provided, that if the applicable Replaced Lender does not execute the
Assignment Agreement within one (1) Business Day (or such shorter period as is
acceptable to Administrative Agent) after Borrower’s request, execution of such
Assignment Agreement by the Replaced Lender shall not be required to effect such
assignment; or

(B) terminate such non-consenting Lender’s Commitment and/or repay Loans held by
such Lender (or, if such non-consenting Lender’s consent is required with
respect to a particular Class or Tranche of Loans, the Commitment and Loans of
the Affected Class), in either case, upon one (1) Business Day’s (or such
shorter period as is acceptable to Administrative Agent) prior written notice to
Administrative Agent at the Principal Office (which notice Administrative Agent
shall promptly transmit to each of the Lenders). Any such prepayment of the
Loans or termination of the Commitments of such Lender shall be made together
with accrued and unpaid interest, fees and other amounts owing to such Lender
(including all amounts, if any, owing pursuant to Section 5.05) (or if the
applicable consent requires approval of all Lenders of a particular Class or
Tranche but not all Lenders, then Borrower shall terminate all Commitments
and/or repay all Loans, in each case together with payment of all accrued and
unpaid interest, fees and other amounts owing to such Lender (including all
amounts, if any, owing pursuant to Section 5.05) under such Class or Tranche).
Immediately upon any repayment of Loans by Borrower pursuant to this
Section 13.04(b)(B), such Loans repaid or acquired pursuant hereto shall be
cancelled for all purposes and no longer outstanding (and may not be resold,
assigned or participated out by Borrower) for all purposes of this Agreement and
all other Credit Documents, including, but not limited to (A) the making of, or
the application of, any payments to the Lenders under this Agreement or any
other Credit Document, (B) the making of any request, demand, authorization,
direction, notice, consent or waiver under this Agreement or any other Credit
Document, (C) the providing of any rights to Borrower as a Lender under this
Agreement or any

 

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other Credit Document, and (D) the determination of Required Lenders, or for any
similar or related purpose, under this Agreement or any other Credit Document.

(c) Administrative Agent and Borrower may (without the consent of Lenders) amend
any Credit Document to the extent (but only to the extent) necessary to reflect
the existence and terms of Incremental Term Loans, Other Term Loans and Extended
Term Loans. Notwithstanding anything to the contrary contained herein, such
amendment shall become effective without any further consent of any other party
to such Credit Document. In addition, upon the effectiveness of any Refinancing
Amendment, Administrative Agent, Borrower and the Lenders providing the relevant
Credit Agreement Refinancing Indebtedness may amend this Agreement to the extent
(but only to the extent) necessary to reflect the existence and terms of the
Credit Agreement Refinancing Indebtedness incurred pursuant thereto (including
any amendments necessary to treat the Loans and Commitments subject thereto as
Other Term Loans and/or Other Term Loan Commitments). Administrative Agent and
Borrower may effect such amendments to this Agreement and the other Credit
Documents as may be necessary or appropriate, in the reasonable opinion of
Administrative Agent and Borrower, to effect the terms of any Refinancing
Amendment. Administrative Agent and Collateral Agent may enter into
(i) amendments to this Agreement and the other Credit Documents with Borrower as
may be necessary in order to establish new tranches or sub-tranches in respect
of the Loans and/or Commitments extended pursuant to Section 2.13 or incurred
pursuant to Sections 2.12 or 2.15, (ii) such technical amendments as may be
necessary or appropriate in the reasonable opinion of Administrative Agent and
Borrower in connection with the establishment of such new tranches or
sub-tranches, in each case on terms consistent with Section 2.13, Section 2.12
or Section 2.15 and (iii) such technical amendments as may be necessary to
establish separate tranches or sub-tranches if the terms of a portion (but not
all) of an existing Tranche is amended in accordance with Section 13.04(a).

(d) Notwithstanding the foregoing, this Agreement may be amended (or amended and
restated) with the written consent of the Required Lenders, Administrative Agent
and Borrower (a) to add one or more additional credit facilities to this
Agreement and to permit extensions of credit from time to time outstanding
thereunder and the accrued interest and fees in respect thereof to share ratably
in the benefits of this Agreement and the other Credit Documents with the Term
Loans (or any Tranche thereof in the case of additional Term Loans) and the
accrued interest and fees in respect thereof and (b) to include appropriately
the Lenders holding such credit facilities in any determination of the Required
Lenders and/or Required Tranche Lenders, as applicable.

(e) Notwithstanding anything to the contrary herein, (i) upon five (5) Business
Days’ prior written notice to the Lenders, any Credit Document may be waived,
amended, supplemented or modified pursuant to an agreement or agreements in
writing entered into by Borrower and Administrative Agent (without the consent
of any Lender, unless any Lender shall have objected within such five
(5) Business Day period) solely to effect administrative changes or to correct
administrative errors or omissions or to cure an ambiguity, defect or error
(including, without limitation, to revise the legal description of any Mortgaged
Real Property based on surveys), (ii) any Credit Document may be waived,
amended, supplemented or modified pursuant to an agreement or agreements in
writing entered into by Borrower and Administrative Agent (without the consent
of any Lender) to grant a new Lien for the benefit of the Secured Parties or
extend an existing Lien over additional property or to make modifications which
are not materially adverse to the Lenders and are requested or required by
Gaming Authorities or Gaming Laws and (iii) any Credit Document may be waived,
amended, supplemented or modified pursuant to an agreement or agreements in
writing entered into by Borrower and Administrative Agent (without the consent
of any Lender) to permit any changes requested or required by any Governmental
Authority that are not materially adverse to the Lenders (including any changes
relating to qualifications as a permitted holder of debt, licensing or limits on
Property that may be pledged as Collateral or available remedies).

 

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Notwithstanding anything to the contrary herein, (A) additional extensions of
credit consented to by Required Lenders shall be permitted hereunder on a
ratable basis with the existing Loans (including as to proceeds of, and sharing
in the benefits of, Collateral and sharing of prepayments), (B) Collateral Agent
shall (and each of the Lenders (and each Secured Party by accepting the benefits
of the Collateral) hereby authorize Collateral Agent to) enter into the Pari
Passu Intercreditor Agreement upon the request of Borrower in connection with
the incurrence of Permitted Second Priority Refinancing Debt, or Ratio Debt (and
Permitted Refinancings thereof that satisfy Sections 10.01(t)(A)(iv) and
10.01(t)(A)(vi)), as applicable (or any amendments and supplements thereto in
connection with the incurrence of additional Permitted Second Priority
Refinancing Debt, or Ratio Debt (and Permitted Refinancings thereof that satisfy
Sections 10.01(t)(A)(iv) and 10.01(t)(A)(vi))), and (C) Collateral Agent (and
each of the Lenders (and each Secured Party by accepting the benefits of the
Collateral) hereby authorize Collateral Agent to) shall enter into the First
Lien/Second Lien Intercreditor Agreement on the Closing Date with the First Lien
Administrative Agent and the other parties thereto and after the Closing Date
into any appropriate (as determined by Collateral Agent) amendments,
supplements, joinders or restatements thereto upon the request of Borrower in
connection with the incurrence of any Permitted Refinancing of the First Lien
Credit Agreement or any “Permitted First Priority Refinancing Debt” (as defined
in the First Lien Credit Agreement), or Ratio Debt (and Permitted Refinancings
thereof that satisfy Sections 10.01(t)(A)(iv) and 10.01(t)(A)(vi)), as
applicable (or any amendments and supplements thereto in connection with the
incurrence of additional “Permitted First Priority Refinancing Debt” (as defined
in the First Lien Credit Agreement), or Ratio Debt (and Permitted Refinancings
thereof that satisfy Sections 10.01(t)(A)(iv) and 10.01(t)(A)(vi))). Each Lender
agrees to be bound by the terms of the Pari Passu Intercreditor Agreement and
the First Lien/Second Lien Intercreditor Agreement, from and after the
effectiveness thereof, as if directly a party thereto.

(f) Notwithstanding anything to the contrary herein, the applicable Credit Party
or Credit Parties and Administrative Agent and/or Collateral Agent may (in its
or their respective sole discretion, or shall, to the extent required by any
Credit Document) enter into any amendment or waiver of any Credit Document, or
enter into any new agreement or instrument, without the consent of any other
Person, to effect the granting, perfection, protection, expansion or enhancement
of any security interest in any Collateral or additional Property to become
Collateral for the benefit of the Secured Parties, or as required by local law
to give effect to, or protect any security interest for the benefit of the
Secured Parties, in any Property or so that the security interests therein
comply with applicable Requirements of Law or to release any Collateral which is
not required under the Security Documents.

(g) Notwithstanding anything to the contrary herein, Administrative Agent and
Collateral Agent shall (A) release any Lien granted to or held by Administrative
Agent or Collateral Agent upon any Collateral (i) upon Payment in Full of the
Obligations, (ii) upon the sale, transfer or other disposition of Collateral to
the extent required pursuant to the last paragraph in Section 10.05 (and
Administrative Agent or Collateral Agent may rely conclusively on a certificate
to that effect provided to it by any Credit Party upon its reasonable request
without further inquiry) to any Person other than a Credit Party, (iii) if
approved, authorized or ratified in writing by the Required Lenders (or all of
the Lenders to the extent required by Section 13.04(a)), (iv) if the property
subject to such Lien is owned by a Guarantor, upon release of such Guarantor
from its obligations under its Guarantee pursuant to Section 6.08, (v)
constituting Equity Interests in or property of an Unrestricted Subsidiary,
(vi) subject to Liens permitted under Sections 10.02(i) or 10.02(k), in each
case, to the extent the documents governing such Liens do not permit such
Collateral to secure the Obligations, or (vii) as otherwise may be provided
herein or in the relevant Security Documents, and (B) consent to and enter into
(and execute documents permitting the filing and recording, where appropriate)
the grant of easements and covenants and subordination rights with respect to
real property, conditions, restrictions and declarations on customary terms, and
subordination, non-disturbance and attornment agreements on customary terms
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Borrower with respect to leases entered into by Borrower and its Restricted
Subsidiaries, to the extent requested by Borrower and not materially adverse to
the interests of the Lenders.

SECTION 13.05. Benefit of Agreement; Assignments; Participations.

(a) This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and assigns of the parties hereto;
provided, however, no Credit Party may assign or transfer any of its rights,
obligations or interest hereunder or under any other Credit Document (it being
understood that a merger or consolidation not prohibited by this Agreement shall
not constitute an assignment or transfer) without the prior written consent of
all of the Lenders and provided, further, that, although any Lender may
transfer, assign or grant participations in its rights hereunder, such Lender
shall remain a “Lender” for all purposes hereunder (and may not transfer or
assign all or any portion of its Commitments, Loans or related Obligations
hereunder except as provided in Section 13.05(b)) and the participant shall not
constitute a “Lender” hereunder; and provided, further, that no Lender shall
transfer, assign or grant any participation (x) to a natural person, (y) to a
Person that is a Disqualified Lender as of the applicable Trade Date (unless
consented to by Borrower) or (z) under which the participant shall have rights
to approve any amendment to or waiver of this Agreement or any other Credit
Document except to the extent such amendment or waiver would (i) extend the date
for any scheduled payment on, or the final scheduled maturity of, any Loan or
Note in which such participant is participating, or reduce the rate or extend
the time of payment of interest or fees thereon (except in connection with a
waiver of applicability of any post-default increase in interest rates) or
reduce the principal amount thereof, or increase the amount of the participant’s
participation over the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default or of a mandatory reduction in the
total Commitments or of a mandatory prepayment shall not constitute a change in
the terms of such participation, that an increase in any Commitment (or the
available portion thereof) or Loan shall be permitted without the consent of any
participant if the participant’s participation is not increased as a result
thereof and that any amendment or modification to the financial definitions in
this Agreement shall not constitute a reduction in any rate of interest or fees
for purposes of this clause (i), notwithstanding the fact that such amendment or
modification actually results in such a reduction), (ii) consent to the
assignment or transfer by any Credit Party of any of its rights and obligations
under this Agreement or other Credit Document to which it is a party or
(iii) release all or substantially all of the Collateral under all of the
Security Documents (except as expressly provided in the Credit Documents) or all
or substantially all of the value of the Guarantees Documents (except as
expressly provided in the Credit Documents) supporting the Loans hereunder in
which such participant is participating. In the case of any such participation,
except as described below, the participant shall not have any rights under this
Agreement or any of the other Credit Documents (the participant’s rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the participant relating thereto).
Borrower agrees that each participant shall be entitled to the benefits of
Sections 5.01, and 5.06 (subject to the obligations and limitations of such
Sections, including Section 5.06(c) (it being understood that the documentation
required under Section 5.06(c) shall be delivered solely to the participating
Lender)) to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to paragraph (b) of this Section 13.05, provided that
such participant (A) shall be subject to the provisions of Section 2.11 as if it
were an assignee under paragraph (b) of this Section 13.05; and (B) shall not be
entitled to receive any greater payment under Section 5.01 or 5.06, with respect
to any participation, than its participating Lender would have been entitled to
receive, except to the extent such entitlement to receive a greater payment
results from a Change in Law that occurs after such participant acquired the
applicable participation. To the extent permitted by law, each participant also
shall be entitled to the benefits of Section 4.07 as though it were a Lender.
Each Lender that sells a participation shall, acting solely for this purpose as
a non-fiduciary agent of Borrower, maintain a register on which it enters the
name and address of each participant and the principal amounts (and related
interest amounts) of each participant’s interest in the

 

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Loans or other obligations under this Agreement (the “Participant Register”);
provided that no Lender shall have any obligation to disclose all or any portion
of the Participant Register (including the identity of any Participant or any
information relating to a Participant’s interest in any commitments, loans,
letters of credit or its other obligations under any Credit Document) to any
Person except to the extent that such disclosure is necessary to establish that
such commitment, loan, letter of credit or other obligation is in registered
form under Section 5f.103-1(c) of the United States Treasury Regulations. The
entries in the Participant Register shall be conclusive, absent manifest error,
and such Lender shall treat each Person whose name is recorded in the
Participant Register as the owner of such participation for all purposes of this
Agreement notwithstanding any notice to the contrary.

(b) No Lender (or any Lender together with one or more other Lenders) may assign
all or any portion of its Commitments, Loans and related outstanding Obligations
(or, if the Commitments with respect to the relevant Tranche have terminated,
outstanding Loans and Obligations) hereunder, except to one or more Eligible
Assignees (treating any fund that invests in loans and any other fund that
invests in loans and is managed or advised by the same investment advisor of
such fund or by an Affiliate of such investment advisor as a single Eligible
Assignee) with the consent of (x) Administrative Agent and (y) so long as no
Event of Default pursuant to Section 11.01(b) or 11.01(c), or, with respect to
Borrower, 11.01(g) or 11.01(h), has occurred and is continuing, Borrower (each
such consent not to be unreasonably withheld or delayed); provided that
(1) except in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitments and Loans at the time owing to it, the aggregate
amount of the Commitments or Loans subject to such assignment shall not be less
than $250,000; (2) no such consent shall be necessary in the case of an
assignment of Term Loans by a Lender to another Lender or an Affiliate or
Approved Fund of a Lender and (3) Borrower shall be deemed to have consented to
any such assignment with respect to a Term Loan unless it shall object thereto
by written notice to Administrative Agent within ten (10) Business Days after
having received notice thereof. Each assignee shall become a party to this
Agreement as a Lender by execution of an Assignment Agreement; provided that
(I) Administrative Agent shall, unless it otherwise agrees in its sole
discretion, receive at the time of each such assignment, from the assigning or
assignee Lender, the payment of a non-refundable assignment fee of $3,500, (II)
no such transfer or assignment will be effective until recorded by
Administrative Agent on the Register pursuant to Section 2.08, and (III) such
assignments may be made on a pro rata basis among Commitments and/or Loans (and
related Obligations). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 13.05,
whether or not such assignment or transfer is reflected in the Register, shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations. To the extent of any assignment
permitted pursuant to this Section 13.05(b), the assigning Lender shall be
relieved of its obligations hereunder with respect to its assigned Commitments
and outstanding Loans (provided that such assignment shall not release such
Lender of any claims or liabilities that may exist against such Lender at the
time of such assignment). At the time of each assignment pursuant to this
Section 13.05(b) to a Person which is not already a Lender hereunder, the
respective assignee Lender shall, to the extent legally eligible to do so,
provide to Borrower and Administrative Agent the appropriate IRS Forms (and, if
applicable, a U.S. Tax Compliance Certificate) as described in Section 5.06(c),
as applicable.

(c) Nothing in this Agreement shall prevent or prohibit any Lender from pledging
or assigning a security interest in its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment of a security
interest to a Federal Reserve Bank or other central banking authority. No pledge
pursuant to this Section 13.05(c) shall release the transferor Lender from any
of its obligations hereunder or permit the pledgee to become a lender hereunder
without otherwise complying with Section 13.05(b).

 

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(d) Notwithstanding anything to the contrary contained in this Section 13.05 or
any other provision of this Agreement, Borrower and its Subsidiaries may, but
shall not be required to, purchase outstanding Term Loans pursuant to (x) the
Auction Procedures established for each such purchase in an auction managed by
Auction Manager and (y) through open market purchases, subject solely to the
following conditions:

(i) (x) with respect to any Borrower Loan Purchase pursuant to the Auction
Procedures, at the time of the applicable Purchase Notice (as defined in Exhibit
O), no Event of Default has occurred and is continuing or would result
therefrom, and (y) with respect to any Borrower Loan Purchase consummated
through an open market purchase, at the Trade Date of the applicable assignment,
no Event of Default has occurred and is continuing or would result therefrom;

(ii) immediately upon any Borrower Loan Purchase, the Term Loans purchased
pursuant thereto shall be cancelled for all purposes and no longer outstanding
(and may not be resold, assigned or participated out by Borrower) for all
purposes of this Agreement and all other Credit Documents, including, but not
limited to (A) the making of, or the application of, any payments to the Lenders
under this Agreement or any other Credit Document, (B) the making of any
request, demand, authorization, direction, notice, consent or waiver under this
Agreement or any other Credit Document, (C) the providing of any rights to
Borrower as a Lender under this Agreement or any other Credit Document, and
(D) the determination of Required Lenders, or for any similar or related
purpose, under this Agreement or any other Credit Document;

(iii) with respect to each Borrower Loan Purchase, Administrative Agent shall
receive (x) if such Borrower Loan Purchase is consummated pursuant to the
Auction Procedures, a fully executed and completed Borrower Assignment Agreement
effecting the assignment thereof, and (y) if such Borrower Loan Purchase is
consummated pursuant to an open market purchase, a fully executed and completed
Open Market Assignment and Assumption Agreement effecting the assignment
thereof;

(iv) Borrower may not use the proceeds of any First Lien Revolving Loan to fund
the purchase of outstanding Loans pursuant to this Section 13.05(d); and

(v) neither Borrower nor any of its Subsidiaries will be required to represent
or warrant that they are not in possession of non-public information with
respect to Borrower and/or any Subsidiary thereof and/or their respective
securities in connection with any purchase permitted by this Section 13.05(d).

The assignment fee set forth in Section 13.05(b) shall not be applicable to any
Borrower Loan Purchase consummated pursuant to this Section 13.05(d).

(e) Any Lender may at any time, assign all or a portion of its rights and
obligations with respect to Term Loans under this Agreement to a Person who is
or will become, after such assignment, an Affiliated Lender through (x) Dutch
auctions open to all Lenders on a pro rata basis or (y) open market purchases on
a non-pro rata basis, in each case subject to the following limitations:

(i) the assigning Lender and the Affiliated Lender purchasing such Lender’s Term
Loans shall execute and deliver to Administrative Agent an assignment agreement
substantially in the form of Exhibit J hereto (an “Affiliated Lender Assignment
and Assumption”);

 

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(ii) Affiliated Lenders will not (i) receive information provided solely to
Lenders by Administrative Agent or any Lender and will not be permitted to
receive notice nor attend or participate in conference calls or meetings
attended solely by the Lenders and Administrative Agent, other than the right to
receive notices of prepayments and other administrative notices in respect of
its Loans or Commitments required to be delivered to Lenders or (ii) challenge
Administrative Agent and the Lenders’ attorney client privilege;

(iii) the aggregate principal amount of Term Loans held at any one time by
Affiliated Lenders shall not exceed 25% of the principal amount of all Term
Loans at such time outstanding (determined after giving effect to any
substantially simultaneous cancellations thereof) (such percentage, the
“Affiliated Lender Cap”); provided that to the extent any assignment to an
Affiliated Lender would result in the aggregate principal amount of all Loans
held by Affiliated Lenders exceeding the Affiliated Lender Cap, the assignment
of such excess amount will be void ab initio;

(iv) as a condition to each assignment pursuant to this clause (e),
Administrative Agent shall have been provided a notice in the form of Exhibit J
to this Agreement in connection with each assignment to an Affiliated Lender or
a Person that upon effectiveness of such assignment would constitute an
Affiliated Lender pursuant to which such Affiliated Lender shall waive any right
to bring any action in connection with such Term Loans against Administrative
Agent, in its capacity as such;

(v) Affiliated Lenders will not be required to represent or warrant that they
are not in possession of non-public information with respect to Borrower and/or
any Subsidiary thereof and/or their respective securities in connection with any
assignment permitted by this Section 13.05(e); and

(vi) any Term Loans acquired by any Affiliated Lender may (but shall not be
required to), with the consent of Borrower, be contributed to Borrower or any of
its Restricted Subsidiaries (it being understood that any such Term Loans shall,
to the extent permitted by applicable Law, be retired and cancelled promptly
upon such contribution) and which may be converted into or exchanged for debt or
equity securities that are permitted to be issued by such Person at such time;
provided that upon any such cancellation, of the aggregate outstanding principal
amount of the Term Loans of the applicable Tranche shall be deemed reduced, as
of the date of such contribution, by the full par value of the aggregate
principal amount of the Term Loans so contributed and cancelled, and each
principal repayment installment with respect to the Term Loans of such Tranche
pursuant to Section 3.01 shall be reduced pro rata by the full par value of the
aggregate principal amount of Term Loans so contributed and cancelled.

(f) Notwithstanding anything in Section 13.04 or the definition of “Required
Lenders” or “Required Tranche Lenders,” to the contrary, for purposes of
determining whether the Required Lenders or the Required Tranche Lenders have
(i) consented (or not consented) to any amendment, modification, waiver, consent
or other action with respect to any of the terms of any Credit Document or any
departure by any Credit Party therefrom, (ii) subject to Section 13.05(g),
consented (or not consented) to any plan of reorganization pursuant to the
Bankruptcy Code, (iii) otherwise acted on any matter related to any Credit
Document, or (iv) directed or required Administrative Agent, Collateral Agent or
any Lender to undertake any action (or refrain from taking any action) with
respect to or under any Credit Document, no Affiliated Lender shall have any
right to consent (or not consent), otherwise act or direct or require
Administrative Agent, Collateral Agent or any Lender to take (or refrain from
taking) any such action and:

 

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(i) all Term Loans held by any Affiliated Lenders shall be deemed to be not
outstanding for all purposes of calculating whether the Required Lenders or the
Required Tranche Lenders have taken any actions; and

(ii) all Term Loans held by Affiliated Lenders shall be deemed to be not
outstanding for all purposes of calculating whether all Lenders have taken any
action unless the action in question affects such Affiliated Lender in a
disproportionately adverse manner than its effect on other Lenders;

provided that, notwithstanding the foregoing, in respect of this
Section 13.05(f), such Affiliated Lender shall have the right to vote (and the
Term Loans held by such Affiliated Lender shall not be so disregarded) with
respect to any amendment, modification, waiver, consent or other such action
with respect to any of the terms of this Agreement or any other Credit Document
that (1) requires the vote of all Lenders or all Lenders directly and adversely
affected thereby, as the case may be or (2) would affect any Affiliated Lender
(in its capacity as a Lender) in a manner disproportionate to the effect on any
Lender of the same Tranche that is not an Affiliated Lender or that would
deprive such Affiliated Lender of its pro rata share of any payments to which it
is entitled, provided, further, that no amendment, modification, waiver, consent
or other such action with respect to any of the terms of this Agreement or any
other Credit Document shall (i) disproportionately affect such Affiliated Lender
in its capacity as a Lender as compared to the other Lenders of the same Tranche
that are not Affiliated Lenders, (ii) increase the Commitments or obligations of
any Affiliated Lender, (iii) extend the due dates for payments of interest and
scheduled amortization (including at maturity) of any Term Loans owed to any
Affiliated Lender, (iv) reduce the amounts owing to any Affiliated Lender or
(v) deprive any Affiliated Lender of its share of any payments which the Lenders
are entitled to share on a pro rata basis hereunder in each case without the
consent of such Affiliated Lender.

(g) Notwithstanding anything in this Agreement or the other Credit Documents to
the contrary, each Affiliated Lender hereby agrees that and each Affiliated
Lender Assignment and Assumption shall provide a confirmation that, if a
proceeding under any Debtor Relief Law shall be commenced by or against Borrower
or any other Credit Party at a time when such Lender is an Affiliated Lender,
such Affiliated Lender irrevocably authorizes and empowers Administrative Agent
to vote on behalf of such Affiliated Lender with respect to the Term Loans held
by such Affiliated Lender in any manner in Administrative Agent’s sole
discretion, unless Administrative Agent instructs such Affiliated Lender to
vote, in which case such Affiliated Lender shall vote with respect to the Term
Loans held by it as Administrative Agent directs; provided that such Affiliated
Lender shall be entitled to vote in accordance with its sole discretion (and not
in accordance with the direction of Administrative Agent) in connection with any
plan of reorganization to the extent any such plan of reorganization proposes to
treat any Obligations held by such Affiliated Lender in a disproportionately
adverse manner to such Affiliated Lender than the proposed treatment of similar
Obligations held by Term Lenders that are not Affiliated Lenders.

(h) Notwithstanding anything in Section 13.04 or the definition of “Required
Lenders” to the contrary, any Lender may at any time, assign all or a portion of
its rights and obligations with respect to Term Loans under this Agreement to a
Person who is or will become, after such assignment, a Debt Fund Affiliate
through (x) Dutch auctions open to all Lenders on a pro rata basis or (y) open
market purchases on a non-pro rata basis, in each case, provided that, for
purposes of determining whether the Required Lenders have (i) consented (or not
consented) to any amendment, modification, waiver, consent or other action with
respect to any of the terms of any Credit Document or any departure by any
Credit Party therefrom, (ii) otherwise acted on any matter related to any Credit
Document or (iii) directed or required

 

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Administrative Agent or any Lender to undertake any action (or refrain from
taking any action) with respect to or under any Credit Document, all Term Loans
held by Debt Fund Affiliates may not account for more than 49.9% (pro rata among
such Debt Fund Affiliates) of the Term Loans of consenting Lenders included in
determining whether the Required Lenders have consented to any action pursuant
to Section 13.04.

(i) [reserved].

(j) [reserved].

(k) (i) No assignment or participation shall be made to any Person that was a
Disqualified Lender as of the date (the “Trade Date”) on which the assigning or
participating Lender entered into a binding agreement to sell and assign all or
a portion of its rights and obligations under this Agreement to such Person
(unless Borrower has consented to such assignment or participation in writing in
its sole and absolute discretion, in which case such Person will not be
considered a Disqualified Lender for the purpose of such assignment or
participation). For the avoidance of doubt, with respect to any assignee or
participant that becomes a Disqualified Lender after the applicable Trade Date
(including as a result of the delivery of a notice pursuant to, and/or the
expiration of the notice period referred to in, the definition of “Disqualified
Lender”), (x) such assignee or participant shall not retroactively be
disqualified from becoming a Lender or participant and (y) the execution by
Borrower of an Assignment Agreement with respect to such assignee will not by
itself result in such assignee no longer being considered a Disqualified Lender.
Any assignment in violation of this clause (k)(i) shall not be void, but the
other provisions of this clause (k) shall apply, and nothing in this subsection
(k) shall limit any rights or remedies available to the Credit Parties at law or
in equity with respect to any Disqualified Lender and any Person that makes an
assignment or participation to a Disqualified Lender in violation of this clause
(k)(i).

(ii) If any assignment or participation is made to any Disqualified Lender
without Borrower’s prior written consent in violation of clause (k)(i) above, or
if any Person becomes a Disqualified Lender after the applicable Trade Date,
Borrower may, at its sole expense and effort, upon notice to the applicable
Disqualified Lender and Administrative Agent, (A) in the case of outstanding
Term Loans held by Disqualified Lenders, purchase or prepay such Term Loan by
paying the lesser of (x) the principal amount thereof and (y) the amount that
such Disqualified Lender paid to acquire such Term Loans, in each case plus
accrued interest, accrued fees and all other amounts (other than principal
amounts) payable to it hereunder and/or (B) require such Disqualified Lender to
assign, without recourse (in accordance with and subject to the restrictions
contained in this Section 13.04), all of its interest, rights and obligations
under this Agreement to one or more Eligible Assignees at the lesser of (x) the
principal amount thereof and (y) the amount that such Disqualified Lender paid
to acquire such interests, rights and obligations, in each case plus accrued
interest, accrued fees and all other amounts (other than principal amounts)
payable to it hereunder.

(iii) Notwithstanding anything to the contrary contained in this Agreement,
Disqualified Lenders (A) will not (x) have the right to receive information,
reports or other materials provided to Lenders by Borrower, Administrative Agent
or any other Lender, (y) attend or participate in meetings attended by the
Lenders and Administrative Agent, or (z) access any electronic site established
for the Lenders or confidential communications from counsel to or financial
advisors of Administrative Agent or the Lenders and (B) (x) for purposes of any
consent to any amendment, waiver or modification of, or any action under, and
for the purpose of any direction to Administrative Agent or any Lender to
undertake any action (or refrain from taking any action) under this Agreement or
any other Credit Document, each Disqualified Lender will be deemed to have
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Lenders that are not Disqualified Lenders consented to such matter, and (y) for
purposes of voting on any plan of reorganization or plan of liquidation pursuant
to any Debtor Relief Laws, each Disqualified Lender party hereto hereby agrees
(1) not to vote on such plan of reorganization or plan of liquidation pursuant
to any Debtor Relief Laws, (2) if such Disqualified Lender does vote on such
plan of reorganization or plan of liquidation pursuant to any Debtor Relief Laws
notwithstanding the restriction in the foregoing clause (1), such vote will be
deemed not to be in good faith and shall be “designated” pursuant to
Section 1126(e) of the Bankruptcy Code (or any similar provision in any other
Debtor Relief Laws), and such vote shall not be counted in determining whether
the applicable class has accepted or rejected such plan of reorganization or
plan of liquidation pursuant to any Debtor Relief Laws in accordance with
Section 1126(c) of the Bankruptcy Code (or any similar provision in any other
Debtor Relief Laws) and (3) not to contest any request by any party for a
determination by the Bankruptcy Court (or other applicable court of competent
jurisdiction) effectuating the foregoing clause (2).

(iv) Administrative Agent shall have the right, and Borrower hereby expressly
authorizes Administrative Agent, to provide the list of Disqualified Lenders to
each Lender specifically requesting the same.

SECTION 13.06. Survival. The obligations of the Credit Parties under Sections
5.01, 5.05, 5.06, 13.03 and 13.19, the obligations of each Guarantor under
Section 6.03, and the obligations of the Lenders under Sections 5.06 and 12.08,
in each case shall survive the repayment of the Loans and the other Obligations
and the termination of the Commitments and, in the case of any Lender that may
assign any interest in its Commitments or Loans (and any related Obligations)
hereunder, shall (to the extent relating to such time as it was a Lender)
survive the making of such assignment, notwithstanding that such assigning
Lender may cease to be a “Lender” hereunder. In addition, each representation
and warranty made, or deemed to be made by a notice of any extension of credit,
herein or pursuant hereto shall be considered to have been relied upon by the
other parties hereto and shall survive the execution and delivery of this
Agreement and the Notes and the making of any extension of credit hereunder,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that Administrative Agent or any Lender may have had notice
or knowledge of any Default or incorrect representation or warranty.

SECTION 13.07. Captions. The table of contents and captions and Section headings
appearing herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this Agreement.

SECTION 13.08. Counterparts; Interpretation; Effectiveness. This Agreement may
be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and the other
Credit Documents, constitute the entire contract among the parties thereto
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof, other than the Commitment Letter, which are not superseded and survive
solely as to the parties thereto (to the extent provided therein). This
Agreement shall become effective when the Closing Date shall have occurred, and
this Agreement shall have been executed and delivered by the Credit Parties and
when Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by facsimile or electronic mail shall be
effective as delivery of a manually executed counterpart of this Agreement.

 

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SECTION 13.09. Governing Law; Submission to Jurisdiction; Waivers; Etc.

(a) GOVERNING LAW. THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND ANY CLAIMS,
CONTROVERSIES, DISPUTES, OR CAUSES OF ACTION (WHETHER ARISING UNDER CONTRACT
LAW, TORT LAW OR OTHERWISE) BASED UPON OR RELATING TO THIS AGREEMENT OR THE
OTHER CREDIT DOCUMENTS (EXCEPT AS TO ANY OTHER CREDIT DOCUMENT, AS EXPRESSLY SET
FORTH IN SUCH OTHER CREDIT DOCUMENT), SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY
CHOICE OF LAW PRINCIPLES THAT WOULD APPLY THE LAW OF ANOTHER JURISDICTION.

(b) SUBMISSION TO JURISDICTION. EACH CREDIT PARTY IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR
PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER AT LAW OR IN EQUITY, WHETHER IN
CONTRACT OR IN TORT OR OTHERWISE, AGAINST ADMINISTRATIVE AGENT, ANY LENDER, ANY
OF THEIR RESPECTIVE AFFILIATES, OR ANY OF THE PARTNERS, DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR ADVISORS OF THE FOREGOING IN ANY WAY RELATING TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS RELATED HERETO OR
THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK SITTING IN
NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT
OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE PARTIES
HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH
COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE
PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION, LITIGATION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS
AGREEMENT OR IN ANY OTHER CREDIT DOCUMENT SHALL AFFECT ANY RIGHT THAT
ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT AGAINST ANY
CREDIT PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) WAIVER OF VENUE. EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT IN ANY
COURT REFERRED TO IN PARAGRAPH (b) OF THIS SECTION. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.

(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 13.02. NOTHING IN THIS
AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

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(e) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON
WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 13.10. Confidentiality. Each Agent and each Lender agrees to keep
information obtained by it pursuant to the Credit Documents confidential in
accordance with such Agent’s or such Lender’s customary practices and agrees
that it will only use such information in connection with the transactions
contemplated hereby and not disclose any of such information other than (a) to
such Agent’s or such Lender’s Affiliates and its and its Affiliates’ respective
employees, representatives, directors, attorneys, auditors, agents, professional
advisors or trustees who are advised of the confidential nature thereof and
instructed to keep such information confidential or to any direct or indirect
creditor or contractual counterparty in swap agreements or such creditor’s or
contractual counterparty’s professional advisor (so long as such creditor,
contractual counterparty or professional advisor to such contractual
counterparty agrees in writing to be bound by the provision of this
Section 13.10) (it being understood that the disclosing Agent or Lender shall be
responsible for such Person’s compliance with this paragraph), (b) to the extent
such information presently is or hereafter becomes available to such Agent or
such Lender on a non-confidential basis from a Person not an Affiliate of such
Agent or such Lender not known to such Agent or such Lender to be violating a
confidentiality obligation by such disclosure, (c) to the extent disclosure is
required by any Law, subpoena or judicial order or process (provided that notice
of such requirement or order shall be promptly furnished to Borrower unless such
notice is legally prohibited) or requested or required by bank, securities,
insurance or investment company regulations or auditors or any administrative
body or commission or self-regulatory organization (including the Securities
Valuation Office of the NAIC) to whose jurisdiction such Agent or such Lender is
subject, (d) to any rating agency to the extent required in connection with any
rating to be assigned to such Agent or such Lender; provided that prior notice
thereof is furnished to Borrower, (e) to pledgees under Section 13.05(c),
assignees, participants, prospective assignees or prospective participants, in
each case who agree in writing to be bound by the provisions of this
Section 13.10 or by provisions at least as restrictive as the provisions of this
Section 13.10 (it being understood that any electronically recorded agreement
from any Person listed above in this clause (e) in respect to any electronic
information (whether posted or otherwise distributed on Intralinks or any other
electronic distribution system) shall satisfy the requirements of this clause
(e)), (f) in connection with the exercise of remedies hereunder or under any
Credit Document or to the extent required in connection with any litigation with
respect to the Loans or any Credit Document or (g) with Borrower’s prior written
consent.

SECTION 13.11. Independence of Representations, Warranties and Covenants. The
representations, warranties and covenants contained herein shall be independent
of each other and no exception to any representation, warranty or covenant shall
be deemed to be an exception to any other representation, warranty or covenant
contained herein unless expressly provided, nor shall any such exception be
deemed to permit any action or omission that would be in contravention of
applicable law.

 

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SECTION 13.12. Severability. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by 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 provisions or the remaining provisions of this Agreement.

SECTION 13.13. Gaming Laws.

(a) Notwithstanding anything to the contrary in this Agreement or any other
Credit Document, this Agreement and the other Credit Documents are subject to
the Gaming Laws and the laws involving the sale, distribution and possession of
alcoholic beverages and/or tobacco, as applicable (the “Liquor Laws”). Without
limiting the foregoing, Administrative Agent, each other Agent, each Lender and
each participant acknowledges that (i) it is the subject of being called forward
by any Gaming Authority or any Governmental Authority enforcing the Liquor Laws
(the “Liquor Authority”), in each of their discretion, for licensing or a
finding of suitability or to file or provide other information, and (ii) all
rights, remedies and powers under this Agreement and the other Credit Documents,
including with respect to the entry into and ownership and operation of the
Gaming Facilities, and the possession or control of gaming equipment, alcoholic
beverages or a gaming or liquor license, may be exercised only to the extent
that the exercise thereof does not violate any applicable provisions of the
Gaming Laws and Liquor Laws and only to the extent that required approvals
(including prior approvals) are obtained from the requisite Governmental
Authorities.

(b) Notwithstanding anything to the contrary in this Agreement or any other
Credit Document, Administrative Agent, each other Agent, each Lender and each
participant agrees to cooperate with each Gaming Authority and each Liquor
Authority (and, in each case, to be subject to Section 2.11) in connection with
the administration of their regulatory jurisdiction over Borrower and the other
Credit Parties, including, without limitation, the provision of such documents
or other information as may be requested by any such Gaming Authorities and/or
Liquor Authorities relating to Administrative Agent, any other Agent, any of the
Lenders or participants, Borrower and its Subsidiaries or to the Credit
Documents.

(c) Notwithstanding anything to the contrary in this Agreement or any other
Credit Document, to the extent any provision of this Agreement or any other
Credit Document excludes any assets from the scope of the Pledged Collateral, or
from any requirement to take any action to make effective or perfect any
security interest in favor of Collateral Agent or any other Secured Party in the
Pledged Collateral, the representations, warranties and covenants made by
Borrower or any Restricted Subsidiary in this Agreement with respect to the
creation, perfection or priority (as applicable) of the security interest
granted in favor of Collateral Agent or any other Secured Party (including,
without limitation, Article VIII of this Agreement) shall be deemed not to apply
to such assets.

SECTION 13.14. USA Patriot Act. Each Lender that is subject to the Act (as
hereinafter defined) to the extent required hereby, notifies Borrower and the
Guarantors that pursuant to the requirements of the USA Patriot Act (Title III
of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is
required to obtain, verify and record information that identifies Borrower and
the Guarantors, which information includes the name and address of Borrower and
the Guarantors and other information that will allow such Lender to identify
Borrower and the Guarantors in accordance with the Act, and Borrower and the
Guarantors agree to provide such information from time to time to any Lender.

SECTION 13.15. Waiver of Claims. Notwithstanding anything in this Agreement or
the other Credit Documents to the contrary, the Credit Parties hereby agree that
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rights as a Lender under this Agreement as a result of any Borrower Loan
Purchase and may not make any claim as a Lender against any Agent or any Lender
with respect to the duties and obligations of such Agent or Lender pursuant to
this Agreement and the other Credit Documents; provided, however, that, for the
avoidance of doubt, the foregoing shall not impair Borrower’s ability to make a
claim in respect of a breach of the representations or warranties or obligations
of the relevant assignor in a Borrower Loan Purchase, including in the standard
terms and conditions set forth in the assignment agreement applicable to a
Borrower Loan Purchase.

SECTION 13.16. No Advisory or Fiduciary Responsibility. In connection with all
aspects of each transaction contemplated hereby (including in connection with
any amendment, waiver or other modification hereof or of any other Credit
Document), Borrower and each other Credit Party acknowledges and agrees, and
acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and
other services regarding this Agreement provided by Administrative Agent,
Collateral Agent, the Lead Arrangers and the Lenders are arm’s-length commercial
transactions between Borrower, each other Credit Party and their respective
Affiliates, on the one hand, and Administrative Agent, Collateral Agent, the
Lead Arrangers and the Lenders, on the other hand, (B) each of Borrower and the
other Credit Parties has consulted its own legal, accounting, regulatory and tax
advisors to the extent it has deemed appropriate, and (C) Borrower and each
other Credit Party is capable of evaluating, and understands and accepts, the
terms, risks and conditions of the transactions contemplated hereby and by the
other Credit Documents; (ii) (A) Administrative Agent, Collateral Agent, the
Lead Arrangers and each Lender is and has been acting solely as a principal and,
except as expressly agreed in writing by the relevant parties, has not been, is
not, and will not be acting as an advisor, agent or fiduciary for Borrower, any
other Credit Party or any of their respective Affiliates, or any other Person
(except as expressly set forth in any commitment letters or engagement letters
between Administrative Agent, Collateral Agent, such Lead Arranger or such
Lender and Borrower or such Credit Party or Affiliate thereof) and (B) neither
Administrative Agent, Collateral Agent, the Lead Arrangers nor any Lender has
any obligation to Borrower, any other Credit Party or any of their respective
Affiliates with respect to the transactions contemplated hereby except those
obligations expressly set forth herein and in the other Credit Documents or in
other written agreements between Administrative Agent, Collateral Agent, the
Lead Arrangers or any Lender on one hand and Borrower, any other Credit Party or
any of their respective Affiliates on the other hand; and (iii) Administrative
Agent, Collateral Agent, the Lead Arrangers and the Lenders and their respective
Affiliates may be engaged in a broad range of transactions that involve
interests that differ from, or conflict with, those of Borrower, the other
Credit Parties and their respective Affiliates, and neither Administrative
Agent, Collateral Agent, the Lead Arrangers, nor any Lender has any obligation
to disclose any of such interests to Borrower, any other Credit Party or any of
their respective Affiliates. Each Credit Party agrees that nothing in the Credit
Documents will be deemed to create an advisory, fiduciary or agency relationship
or fiduciary or other implied duty between Administrative Agent, Collateral
Agent, the Lead Arrangers and the Lenders, on the one hand, and such Credit
Party, its stockholders or its Affiliates, on the other. To the fullest extent
permitted by law, each of Borrower and each other Credit Party hereby waives and
releases any claims that it may have against Administrative Agent, Collateral
Agent, the Lead Arrangers or any Lender with respect to any breach or alleged
breach of agency or fiduciary duty in connection with any aspect of any
transaction contemplated hereby (other than any agency or fiduciary duty
expressly set forth in any commitment letter or engagement letter referenced in
clause (ii)(A)).

SECTION 13.17. Lender Action. Each Lender agrees that it shall not take or
institute any actions or proceedings, judicial or otherwise, for any right or
remedy against any Credit Party or any other obligor under any of the Credit
Documents or the Swap Contracts or (with respect to the exercise of rights
against the collateral) Cash Management Agreements (including the exercise of
any right of setoff, rights on account of any banker’s lien or similar claim or
other rights of self-help), or institute any actions or

 

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proceedings, or otherwise commence any remedial procedures, with respect to any
Collateral or any other property of any such Credit Party, without the prior
written consent of Administrative Agent. The provisions of this Section 13.17
are for the sole benefit of the Agents and Lenders and shall not afford any
right to, or constitute a defense available to, any Credit Party.

SECTION 13.18. Interest Rate Limitation. Notwithstanding anything to the
contrary contained in any Credit Document, the interest paid or agreed to be
paid under the Credit Documents (collectively, the “Charges”) shall not exceed
the maximum rate of non-usurious interest permitted by applicable Law which a
court of competent jurisdiction shall, in a final determination, deem applicable
hereto (the “Maximum Rate”). If any Agent or any Lender shall receive interest
in an amount that exceeds the Maximum Rate, the excess interest shall be applied
to the principal of the Loans or, if it exceeds such unpaid principal, refunded
to Borrower. In determining whether the interest contracted for, charged, or
received by an Agent or a Lender exceeds the Maximum Rate, such Person may, to
the extent permitted by applicable Law, (a) characterize any payment that is not
principal as an expense, fee, or premium rather than interest, (b) exclude
voluntary prepayments and the effects thereof, and (c) amortize, prorate,
allocate, and spread in equal or unequal parts the total amount of interest
throughout the contemplated term of the Obligations hereunder. To the extent
permitted by applicable Law, the interest and other Charges that would have been
payable in respect of such Loan but were not payable as a result of the
operation of this Section 13.18 shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender. Thereafter, interest
hereunder shall be paid at the rate(s) of interest and in the manner provided in
this Agreement, unless and until the rate of interest again exceeds the Maximum
Rate, and at that time this Section 13.18 shall again apply. In no event shall
the total interest received by any Lender pursuant to the terms hereof exceed
the amount that such Lender could lawfully have received had the interest due
hereunder been calculated for the full term hereof at the Maximum Rate. If the
Maximum Rate is calculated pursuant to this Section 13.18, such interest shall
be calculated at a daily rate equal to the Maximum Rate divided by the number of
days in the year in which such calculation is made. If, notwithstanding the
provisions of this Section 13.18, a court of competent jurisdiction shall
finally determine that a Lender has received interest hereunder in excess of the
Maximum Rate, Administrative Agent shall, to the extent permitted by applicable
Law, promptly apply such excess in the order specified in this Agreement and
thereafter shall refund any excess to Borrower or as a court of competent
jurisdiction may otherwise order.

SECTION 13.19. Payments Set Aside. To the extent that any payment by or on
behalf of Borrower is made to any Agent or any Lender, or any Agent or any
Lender exercises its right of setoff, and such payment or the proceeds of such
setoff or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by such Agent or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred and the Agents’ and
the Lenders’ Liens, security interests, rights, powers and remedies under this
Agreement and each Credit Document shall continue in full force and effect, and
(b) each Lender severally agrees to pay to Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by any Agent, plus
interest thereon from the date of such demand to the date such payment is made
at a rate per annum equal to the Federal Funds Effective Rate from time to time
in effect. In such event, each Credit Document shall be automatically reinstated
(to the extent that any Credit Document was terminated) and Borrower shall take
(and shall cause each other Credit Party to take) such action as may be
requested by Administrative Agent and the Lenders to effect such reinstatement.

 

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SECTION 13.20. Acknowledgement and Consent to Bail-In of EEA Financial
Institutions. Notwithstanding anything to the contrary in any Credit Document or
in any other agreement, arrangement or understanding among any such parties,
each party hereto acknowledges that any liability of any EEA Financial
Institution arising under any Credit Document may be subject to the write-down
and conversion powers of an EEA Resolution Authority and agrees and consents to,
and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution
Authority to any such liabilities arising hereunder which may be payable to it
by any party hereto that is an EEA Financial Institution; and

(b) the effects of any Bail-In Action on any such liability, including, if
applicable (i) a reduction in full or in part or cancellation of any such
liability, (ii) a conversion of all, or a portion of, such liability into shares
or other instruments of ownership in such EEA Financial Institution, its parent
entity, or a bridge institution that may be issued to it or otherwise conferred
on it, and that such shares or other instruments of ownership will be accepted
by it in lieu of any rights with respect to any such liability under this
Agreement or any other Credit Document or (iii) the variation of the terms of
such liability in connection with the exercise of the write-down and conversion
powers of any EEA Resolution Authority.

[Signature Pages Follow]

 

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

 

GOLDEN ENTERTAINMENT, INC.,
as Borrower By:  

/s/ Charles H. Protell

Name: Charles H. Protell Title: Executive Vice President, Chief Strategy Officer
and Chief Financial Officer Address for Notices for Borrower and each Subsidiary
Guarantor:

Golden Entertainment, Inc.

6595 S. Jones Blvd.

Las Vegas, NV 89118 Attn: General Counsel Fax: 702-798-7211

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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SUBSIDIARY GUARANTORS:

GOLDEN HOLDINGS, INC.

77 GOLDEN GAMING, LLC

GOLDEN ROUTE OPERATIONS-MONTANA LLC BIG SKY GAMING MANAGEMENT, LLC GOLDEN ROUTE
OPERATIONS-ILLINOIS LLC GOLDEN ROUTE OPERATIONS-PENNSYLVANIA LLC SARTINI SYNERGY
ONLINE, LLC GOLDEN GAMING, LLC,
each as a Guarantor By:  

/s/ Charles H. Protell

Name: Charles H. Protell Title: Executive Vice President, Chief Strategy Officer
and Chief Financial Officer of Golden Entertainment, Inc., in such capacity
acting as agent for each of the foregoing entities

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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GOLDEN AVIATION, LLC GOLDEN PAHRUMP NUGGET, LLC GOLDEN PAHRUMP TOWN, LLC GOLDEN
PAHRUMP LAKESIDE, LLC GOLDEN ROUTE OPERATIONS LLC GOLDEN TAVERN GROUP, LLC
SARTINI GAMING, LLC MARKET GAMING, LLC CARDIVAN, LLC

CORRAL COUNTRY COIN, LLC,

each as a Guarantor

By:  

/s/ Charles H. Protell

Name: Charles H. Protell Title: Executive Vice President, Chief Strategy Officer
and Chief Financial Officer of Golden Entertainment, Inc., in such capacity
acting as agent for each of the foregoing entities

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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GOLDEN - PT’S PUB STEWART-NELLIS 2, LLC GOLDEN - PT’S PUB EAST SAHARA 3, LLC
GOLDEN - PT’S PUB CHEYENNE-NELLIS 5, LLC GOLDEN - PT’S PUB SUMMERLIN 6, LLC
GOLDEN - PT’S PUB VEGAS VALLEY 7, LLC GOLDEN - PT’S PUB WEST SAHARA 8, LLC
GOLDEN - PT’S PUB SPRING MOUNTAIN 9, LLC GOLDEN - PT’S PUB FLAMINGO 10, LLC
GOLDEN - PT’S PUB RAINBOW 11, LLC GOLDEN - PT’S PUB DURANGO 12, LLC GOLDEN -
PT’S PUB WARM SPRINGS 13, LLC GOLDEN - PT’S PUB TWAIN 14, LLC GOLDEN - PT’S PUB
TROPICANA 15, LLC GOLDEN - PT’S PUB WINTERWOOD 16, LLC GOLDEN - PT’S PUB
SUNSET-PECOS 17, LLC GOLDEN - PT’S PUB MLK 18, LLC GOLDEN - PT’S PUB TUNES 19,
LLC GOLDEN - PT’S PUB DECATUR-HACIENDA 20, LLC GOLDEN - PT’S PUB DECATUR-SOBB
21, LLC GOLDEN - PT’S PUB SILVERADO-MARYLAND 22, LLC GOLDEN - PT’S PUB
SILVERADO-BERMUDA 23, LLC GOLDEN - PT’S PUB SUNRISE 24, LLC GOLDEN - PT’S PUB
HUALAPAI 25, LLC GOLDEN – PT’S PUB BIG GAME 26, LLC GOLDEN – PT’S PUB CANTINA
27, LLC GOLDEN – PT’S PUB FORT APACHE 29, LLC GOLDEN-PT’S PUB ANN 30, LLC GOLDEN
- PT’S PUB RUSSELL 31, LLC GOLDEN-PT’S PUB CENTENNIAL 32, LLC GOLDEN - PT’S PUB
HORIZON 33, LLC GOLDEN - PT’S PUB ST. ROSE 35, LLC GOLDEN - PT’S PUB EASTERN 36,
LLC GOLDEN - PT’S PUB RACETRACK 37, LLC GOLDEN - PT’S PUB ANTHEM 38, LLC GOLDEN
- PT’S PUB SUNSET-BUFFALO 39, LLC GOLDEN-PT’S PUB TRIPLE BAR 40, LLC GOLDEN-PT’S
PUB OCEANS 41, LLC GOLDEN-PT’S PUB DESERT INN 42, LLC

GOLDEN - PT’S PUB SPRING VALLEY 44, LLC,

each as a Guarantor

By:  

/s/ Charles H. Protell

Name: Charles H. Protell Title: Executive Vice President, Chief Strategy Officer
and Chief Financial Officer of Golden Entertainment, Inc., in such capacity
acting as agent for each of the foregoing entities

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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GOLDEN-O’ACES BAR RAINBOW 46, LLC GOLDEN-O’ACES BAR POST 47, LLC GOLDEN - PT’S
PUB FOOTHILLS 48, LLC GOLDEN-PT’S PUB FRED’S 49, LLC GOLDEN-PT’S PUB CROSSROADS
TC 50, LLC GOLDEN-PT’S PUB WHITNEY RANCH 51, LLC GOLDEN-PT’S PUB BLACK MOUNTAIN
52, LLC GOLDEN-PT’S PUB MOLLY MALONE’S 53 LLC GOLDEN-PT’S PUB KAVANAUGH’S 54 LLC
GOLDEN-PT’S PUB SEAN PATRICK’S 55 LLC GOLDEN-PT’S PUB MORRISSEY’S 56 LLC
GOLDEN-PT’S PUB GB’S 57 LLC GOLDEN-PT’S PUB OWL 58 LLC GOLDEN-PT’S PUB FIRESIDE
59 LLC GOLDEN-PT’S PUB MOUNTAINSIDE 60 LLC GOLDEN-PT’S PUB OYSTER 61 LLC
GOLDEN-PT’S PUB BEANO’S 62 LLC GOLDEN-PT’S PUB BREW 63 LLC GOLDEN-PT’S PUB RANCH
64 LLC GOLDEN-PT’S BWS 65 LLC GOLDEN-PT’S SRD 66 LLC GOLDEN-PT’S OSO BLANCA 67
LLC GOLDEN-PT’S EL CAPITAN 68 LLC GOLDEN-PT’S WEST MARTIN 69 LLC GOLDEN-PT’S
HUNTINGTON COVE 70 LLC GOLDEN-PT’S GVHR 71 L.L.C. GOLDEN-PT’S PECCOLE SAHARA 72
LLC GOLDEN-PT’S DECATUR 73 LLC GOLDEN-PT’S BUFFALO-BLUE DIAMOND 74 LLC
GOLDEN-PT’S LV CACTUS 75 LLC GOLDEN-PT’S MAULE 76 LLC GOLDEN-SIERRA GOLD DOUBLE
R 1, LLC GOLDEN-SIERRA JUNCTION DOUBLE R 2, LLC SIERRA GOLD JONES 3, LLC SIERRA
GOLD BUFFALO 4, LLC SIERRA GOLD STEPHANIE 5, LLC SIERRA GOLD ALIANTE 6, LLC
SIERRA GOLD FLAMINGO 7 LLC GOLDEN RR EASTERN 3, LLC

BONNIE’S 1 LLC,

each as a Guarantor

By:  

/s/ Charles H. Protell

Name: Charles H. Protell Title: Executive Vice President, Chief Strategy Officer
and Chief Financial Officer of Golden Entertainment, Inc., in such capacity
acting as agent for each of the foregoing entities

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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LAKES GAME DEVELOPMENT, LLC LAKES GAMING AND RESORTS, LLC LAKES JAMUL, INC.
LAKES KAR SHINGLE SPRINGS, L.L.C. LAKES KEAN ARGOVITZ RESORTS-CALIFORNIA, L.L.C.
LAKES NIPMUC, LLC LAKES PAWNEE CONSULTING, LLC LAKES SHINGLE SPRINGS, INC. LAKES
MARYLAND DEVELOPMENT, LLC

EVITTS RESORT, LLC,

each as a Guarantor

By:  

/s/ Charles H. Protell

Name: Charles H. Protell Title: Executive Vice President, Chief Strategy Officer
and Chief Financial Officer of Golden Entertainment, Inc., in such capacity
acting as agent for each of the foregoing entities

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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GOLDEN CASINOS NEVADA LLC ACEP ADVERTISING AGENCY, LLC STRATOSPHERE LEASING, LLC
ACEP INTERACTIVE, LLC STRATOSPHERE GAMING LLC AQUARIUS GAMING LLC ARIZONA
CHARLIE’S, LLC FRESCA, LLC STRATOSPHERE ENTERTAINMENT L.L.C.

W2007 STRATOSPHERE LAND PROPCO, LLC,

each as a Guarantor

By:  

/s/ Charles H. Protell

Name: Charles H. Protell Title: Executive Vice President, Chief Strategy Officer
and Chief Financial Officer of Golden Entertainment, Inc., in such capacity
acting as agent for each of the foregoing entities

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Administrative Agent

By:

 

/s/ John Toronto

 

Name: John Toronto

 

Title: Authorized Signatory

By:

 

/s/ Andrew Griffin

 

Name: Andrew Griffin

 

Title: Authorized Signatory

Address for Notices:

Credit Suisse AG

Attn: Loan Operations – Agency Manager

Eleven Madison Avenue, 9th Floor

New York, NY 10010

Facsimile No.: 212-322-2291

Telephone No.: 919-994-6369

Email: agency.loanops@credit-suisse.com

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Collateral Agent

By:

 

/s/ John Toronto

 

Name: John Toronto

 

Title: Authorized Signatory

By:

 

/s/ Andrew Griffin

 

Name: Andrew Griffin

 

Title: Authorized Signatory

Address for Notices:

Credit Suisse AG

Attn: Loan Operations – Agency Manager

Eleven Madison Avenue, 9th Floor

New York, NY 10010

Facsimile No.: 212-322-2291

Telephone No.: 919-994-6369

Email: agency.loanops@credit-suisse.com

[Signature Page to Golden Entertainment Second Lien Credit Agreement]

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JPMORGAN CHASE BANK, N.A., as a Lender

By:

 

/s/ Chiara Carter

 

Name: Chiara Carter

 

Title: Executive Director

Address for Notices:

JPMorgan Chase Bank, N.A.

Attn: GTS IB Standby

10420 Highland Manor Drive, Floor 04

Tampa, FL 33610-9128

Facsimile No.: 856-294-5267

Telephone No.: 800-634-1969

Email: GTS.IB.Standby@JPMChase.com

[Signature Page to Golden Entertainment Second Lien Credit Agreement]