Exhibit 10.4

EXECUTION COPY

GOLF COURSE USE AGREEMENT

By and Among

Rio Secco LLC, Cascata LLC, Chariot Run LLC and Grand Bear LLC

(collectively, and together with their respective successors and assigns),

as “Owner”

and

Caesars Enterprise Services, LLC and CEOC, LLC

(collectively, or if the context clearly requires, individually, and together
with their respective successors and assigns),

as “User”

and,

solely for purposes of Section 2.1(c) hereof, Caesars License Company, LLC

dated

October 6, 2017

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TABLE OF CONTENTS

 

     Page  

ARTICLE I DEFINITIONS

     1  

ARTICLE II GRANT OF LICENSE; TERM

     16  

2.1 Golf Courses; Rights and Privileges; Minimum Rounds; Trademark License

     16  

2.2 Term

     17  

2.3 Renewal Terms

     17  

ARTICLE III GOLF COURSE USE PAYMENTS

     18  

3.1 Payment of Membership Fee and CES Use Fee

     18  

3.2 Late Payment

     19  

3.3 Method of Payment

     19  

3.4 Monthly Invoice

     20  

3.5 Payment of Complimentary Golf Rounds Fee

     20  

ARTICLE IV ADDITIONAL CHARGES

     21  

ARTICLE V NO TERMINATION, ABATEMENT, ETC.

     21  

ARTICLE VI OWNERSHIP OF GOLF COURSES

     22  

ARTICLE VII PRESENT CONDITION & USE

     22  

7.1 Condition of the Golf Courses

     22  

7.2 Use of the Golf Courses

     23  

7.3 Ground Leases

     23  

ARTICLE VIII REPRESENTATIONS AND WARRANTIES

     24  

ARTICLE IX MAINTENANCE, REPAIR AND OPERATIONS

     24  

ARTICLE X INSURANCE

     25  

ARTICLE XI CASUALTY

     26  

11.1 Property Insurance Proceeds

     26  

11.2 Owner’s Obligations Following Casualty

     26  

11.3 No Abatement of Golf Course Use Payments

     27  

11.4 Waiver

     27  

ARTICLE XII EMINENT DOMAIN

     27  

12.1 Condemnation

     27  

12.2 Award Distribution

     28  

12.3 Temporary Taking

     28  

12.4 No Abatement of Membership Fee

     28  

 

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TABLE OF CONTENTS (CONT’D)

 

     Page  

ARTICLE XIII DEFAULTS & REMEDIES

     29  

13.1 User Events of Default

     29  

13.2 Owner Remedies

     30  

13.3 Owner Events of Default; User Remedies

     30  

13.4 Damages

     31  

13.5 Application of Funds

     31  

13.6 Owner’s Right to Cure User’s Default

     32  

13.7 Reduction of Minimum Rounds Per Month and Minimum Rounds Per Year

     32  

13.8 Miscellaneous.

     32  

ARTICLE XIV LICENSING EVENTS

     33  

14.1 Owner Licensing Event

     33  

14.2 User Licensing Event

     33  

ARTICLE XV INDEMNIFICATION

     34  

ARTICLE XVI TRANSFERS BY OWNER

     35  

16.1 Transfers Generally

     35  

16.2 Severance Agreements

     36  

16.3 No Release of Owner’s Obligations; Exception

     37  

ARTICLE XVII TRANSFERS BY USER

     37  

17.1 Assignment

     37  

17.2 Permitted Assignments and Transfers

     38  

17.3 Costs

     38  

17.4 No Release of User’s Obligations; Exception

     38  

17.5 Merger of CEOC

     38  

 

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TABLE OF CONTENTS (CONT’D)

 

     Page  

ARTICLE XVIII ESTOPPEL CERTIFICATES

     38  

ARTICLE XIX NO WAIVER

     39  

ARTICLE XX REMEDIES CUMULATIVE

     39  

ARTICLE XXI ACCEPTANCE OF SURRENDER

     39  

ARTICLE XXII OWNER FINANCING

     40  

ARTICLE XXIII INTENTIONALLY OMITTED

     40  

ARTICLE XXIV NOTICES

     40  

ARTICLE XXV ATTORNEYS’ FEES

     41  

ARTICLE XXVI ANTI-TERRORISM REPRESENTATIONS

     41  

ARTICLE XXVII MISCELLANEOUS

     42  

27.1 Survival

     42  

27.2 Severability

     42  

27.3 Non-Recourse

     42  

27.4 Successors and Assigns

     42  

27.5 Arbitration

     42  

27.6 Governing Law

     44  

27.7 Waiver of Trial by Jury

     44  

27.8 Entire Agreement

     44  

27.9 Headings

     44  

27.10 Counterparts

     44  

27.11 Interpretation

     45  

27.12 Further Assurances

     45  

27.13 Confidential Information.

     45  

27.14 Time of Essence

     46  

27.15 Consents, Approval and Notices

     46  

27.16 Apportionment of Revenue and Expenses

     46  

27.17 Single, Indivisible Agreement

     47  

27.18 Termination of this Agreement

     47  

 

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EXHIBITS AND SCHEDULES

 

EXHIBIT A-1

  —    GOLF COURSES

EXHIBIT A-2

  —    GROUND LEASED GOLF COURSES; EXISTING GROUND LEASES

EXHIBIT B

  —    USER RIGHTS AND PRIVILEGES

EXHIBIT C

  —    OWNER RIGHTS AND PRIVILEGES

EXHIBIT D

  —    CES USE FEE

EXHIBIT E-1

  —    MINIMUM ROUNDS

EXHIBIT E-2

  —    AGGREGATE MINIMUM ROUNDS

EXHIBIT F

  —    APPROVED CAPITAL IMPROVEMENTS

EXHIBIT G

  —    LICENSED TRADEMARKS

EXHIBIT H

  —    TERMS AND CONDITIONS FOR USE OF THE LICENSED TRADEMARKS

EXHIBIT I

  —    REQUIRED INSURANCE

 

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GOLF COURSE USE AGREEMENT

THIS GOLF COURSE USE AGREEMENT (this “Agreement”) is entered into as of
October 6, 2017, by and among Rio Secco LLC, Cascata LLC, Chariot Run LLC and
Grand Bear LLC, each a Delaware limited liability company (collectively, and
together with their respective successors and assigns, “Owner”), and Caesars
Enterprise Services, LLC and CEOC, LLC, each a Delaware limited liability
company (collectively, or if the context clearly requires, individually, and
together with their respective successors and assigns, “User”), and, solely for
purposes of Section 2.1(c) hereof, Caesars License Company, LLC, a Nevada
limited liability company (“CLC”).

RECITALS

A. Commencing on January 15, 2015 and continuing thereafter, Caesars
Entertainment Operating Company, Inc., a Delaware corporation, and certain of
its direct and indirect subsidiaries (collectively, the “Debtors”) filed
voluntary petitions for relief under Chapter 11 of Title 11 of the United States
Code in the United States Bankruptcy Court for the Northern District of Illinois
(the “Bankruptcy Court”), jointly administered under Case No. 15-01145, and the
Bankruptcy Court has confirmed the “Debtors’ Third Amended Joint Plan of
Reorganization Pursuant to Chapter 11 of the Bankruptcy Code” (as it may be
altered, amended, modified, or supplemented from time to time in accordance with
the terms of Article X thereof, the “Bankruptcy Plan”).

B. Pursuant to the Bankruptcy Plan, on the date hereof certain of the Debtors
transferred the Golf Courses to Owner, and Owner hereby grants to User certain
priority rights and privileges with respect to access and use of the Golf
Courses and User hereby secures from Owner such priority rights and privileges
with respect to access and use of the Golf Courses, and Owner and User hereby
make certain other agreements relating to User’s access and use of the Golf
Courses, in each case upon the terms set forth in this Agreement.

C. Immediately following the execution of this Agreement, Caesars Entertainment
Operating Company, Inc., a Delaware corporation, will merge into CEOC, LLC, a
Delaware limited liability company.

D. Capitalized terms used in this Agreement and not otherwise defined herein are
defined in Article I hereof.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I

DEFINITIONS

For all purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires, (i) the terms defined in this Article I
have the meanings assigned to them in this Article and include the plural as
well as the singular and any gender as the context requires; (ii) all accounting
terms not otherwise defined herein have the meanings assigned to

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them in accordance with GAAP; (iii) all references in this Agreement to
designated “Articles,” “Sections,” “Exhibits” and other subdivisions are to the
designated Articles, Sections, Exhibits and other subdivisions of this
Agreement; (iv) the word “including” shall have the same meaning as the phrase
“including, without limitation,” and other similar phrases; (v) the words
“herein,” “hereof” and “hereunder” and other words of similar import refer to
this Agreement as a whole and not to any particular Article, Section or other
subdivision; (vi) all Exhibits, Schedules and other attachments annexed to the
body of this Agreement are hereby deemed to be incorporated into and made an
integral part of this Agreement; (vii) all references to a range of Sections,
paragraphs or other similar references, or to a range of dates or other range
(e.g., indicated by “-” or “through”) shall be deemed inclusive of the entire
range so referenced; and (viii) the fact that CEOC is sometimes named herein as
“CEOC” is not intended to vitiate or supersede the fact that CEOC is included as
one of the entities constituting User.

“Additional Charges”: All amounts, liabilities and obligations (excluding the
Golf Course Use Payments) which User assumes or agrees or is obligated to pay
under this Agreement and, in the event of any failure on the part of User to pay
any of those items, every fine, penalty, interest and cost which may be added
for non-payment or late payment of such items pursuant to the terms hereof or
under applicable law.

“Adjusted Membership Fee”: An amount equal to the product of (a) the
then-applicable Membership Fee (i.e., the Membership Fee immediately prior to
the applicable adjustment), multiplied by (b) the quotient of (x) the new
monthly Rent amount payable under the Non-CPLV Lease (i.e., the monthly Rent
amount payable under the Non-CPLV Lease immediately after the applicable
adjustment), divided by (y) the then-applicable monthly Rent amount payable
under the Non-CPLV Lease (i.e., the monthly Rent amount payable under the
Non-CPLV Lease immediately prior to the applicable adjustment).

“Affiliate”: When used with respect to a specified 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. In no event
shall User or any of its Affiliates be deemed to be an Affiliate of Owner or any
of Owner’s Affiliates as a result of this Agreement and/or as a result of any
consolidation by User or Owner of the other such party or the other such party’s
Affiliates with User or Owner (as applicable) for accounting purposes.

“Aggregate Minimum Rounds Per Year”: The aggregate of the Minimum Rounds Per
Year for all of the Golf Courses during each calendar year as more particularly
set forth on Exhibit E-2 attached hereto.

“Aggregate Minimum Rounds Per Month”: The aggregate of the Minimum Rounds Per
Month for all of the Golf Courses during each calendar month as more
particularly set forth on Exhibit E-2 attached hereto.

“Agreement”: As defined in the preamble.

“Annual Minimum Rounds Fee”: With respect to each Golf Course, an annual amount
equal to the product of (1) the applicable Minimum Rounds Rate for such Golf
Course multiplied by (2) the applicable number of Minimum Rounds Per Year for
such Golf Course.

 

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“Annual Other Sponsored Rounds Fee”: With respect to each Golf Course, an annual
amount equal to the aggregate of the Other Sponsored Rounds Charges for all of
the Other Sponsored Rounds For The Year at such Golf Course.

“Approved Capital Improvements”: As defined in Article IX.

“Award”: All compensation, sums or anything of value awarded, paid or received
from the applicable authority on a total or partial Taking or Condemnation,
including any and all interest thereon.

“Beginning CPI”: As defined in the definition of CPI Increase.

“Business Day”: Each Monday, Tuesday, Wednesday, Thursday and Friday that (i) is
not a day on which national banks in the City of Las Vegas, Nevada or in New
York, New York are authorized, or obligated, by law or executive order, to
close, and (ii) is not any other day that is not a “Business Day” as defined
under any of the Leases.

“Cash”: Cash and cash equivalents and all instruments evidencing the same or any
right thereto and all proceeds thereof.

“Casualty Event”: Any loss, damage or destruction with respect to the Golf
Courses or any portion thereof.

“CEC”: Caesars Entertainment Corporation, a Delaware corporation.

“CEOC”: CEOC, LLC, a Delaware limited liability company, as successor by merger
to Caesars Entertainment Operating Company, Inc., a Delaware corporation.

“CES”: Caesars Enterprise Services, LLC, a Delaware limited liability company.

“CES Use Fee”: An annual amount payable as provided in Article III, calculated
as follows: For the first (1st) Usage Year of the Term, the CES Use Fee shall be
equal to Three Million and No/100 Dollars ($3,000,000.00), which amount is
allocable among the Golf Courses during the first (1st) Usage Year of the Term
as set forth on Exhibit D. The CES Use Fee shall thereafter be adjusted annually
as set forth in the following sentence. On each CES Use Fee Escalator Adjustment
Date during the second (2nd) Usage Year of the Term through and including the
final Usage Year of the Term, the CES Use Fee payable for such Usage Year shall
be adjusted to be equal to the CES Use Fee payable for the immediately preceding
Usage Year, multiplied by the Escalator, and shall be allocated among the Golf
Courses in the same proportions as the amounts set forth on Exhibit D.

“CES Use Fee Escalator Adjustment Date”: The first day of each Usage Year,
excluding the first Usage Year of the Initial Term.

“CES Use Fee Reduction Amount”: A proportionate reduction of the CES Use Fee,
which proportionate amount shall be determined in accordance with the following
sentence. In the event that this Agreement terminates with respect to any Golf
Course(s) pursuant to Section 11.2(a), Section 11.2(b), Section 12.1(a),
Section 12.1(b), Section 12.3 or Article XVI,

 

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the above-described proportionate amount shall be equal to the product of
(a) the then-applicable CES Use Fee (i.e., the CES Use Fee immediately prior to
the applicable adjustment) multiplied by (b) a fraction, (x) the numerator of
which shall be the amount(s) related to the applicable Golf Course(s) for which
this Agreement terminates set forth in the “Total” column on Exhibit D, and
(y) the denominator of which shall be Three Million and No/100 Dollars
($3,000,000.00).

“Change of Control”: With respect to any party, the occurrence of any of the
following: (a) the direct or indirect sale, exchange or other transfer (other
than by way of merger, consolidation or amalgamation), in one or a series of
related transactions, of all or substantially all the assets of such party and
its Subsidiaries, taken as a whole, to one or more Persons; (b) an officer of
such party becomes aware (by way of a report or any other filing pursuant to
Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) of
the consummation of any transaction or series of related transactions
(including, without limitation, any merger, consolidation or amalgamation), the
result of which is that any “person” or “group” (as used in Section 13(d)(3) of
the Exchange Act) or any successor provision) becomes the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act or any successor
provision), directly or indirectly, of more than fifty percent (50%) of the
Voting Stock of such party or other Voting Stock into which such party’s Voting
Stock is reclassified, consolidated, exchanged or changed, measured by voting
power rather than number of securities or other ownership interests; or (c) such
party consolidates with, or merges or amalgamates with or into, any other Person
(or any other Person consolidates with, or merges or amalgamates with or into,
such party), in any such event pursuant to a transaction in which any of such
party’s outstanding Voting Stock or any of the Voting Stock of such other Person
is converted into or exchanged for cash, securities or other property, other
than any such transaction where such party’s Voting Stock outstanding
immediately prior to such transaction constitutes, or is converted into or
exchanged for, a majority of the outstanding Voting Stock of the surviving
Person or any direct or indirect Parent Entity of the surviving Person
immediately after giving effect to such transaction measured by voting power
rather than number of securities or other ownership interests. For purposes of
the foregoing definition: (x) a party shall include any Parent Entity of such
party; and (y) “Voting Stock” shall mean the securities or other ownership
interests of any class or classes having general voting power under ordinary
circumstances, in the absence of contingencies, to elect the directors, managers
or trustees (or other similar governing body) of a Person. Notwithstanding the
foregoing: (A) the transfer of assets between or among a party’s wholly owned
subsidiaries and such party shall not itself constitute a Change of Control;
(B) the term “Change of Control” shall not include a merger, consolidation or
amalgamation of such party with, or the sale, assignment, conveyance, transfer
or other disposition of all or substantially all of such party’s assets to, an
Affiliate of such party (1) incorporated or organized solely for the purpose of
reincorporating such party in another jurisdiction, and (2) the owners of which
and the number and type of securities or other ownership interests in such
party, measured by voting power and number of securities or other ownership
interests, owned by each of them immediately before and immediately following
such transaction, are materially unchanged; (C) a “person” or “group” shall not
be deemed to have beneficial ownership of securities subject to a stock or asset
purchase agreement, merger agreement or similar agreement (or voting or option
or similar agreement related thereto) prior to the consummation of the
transactions contemplated by such agreement; (D) the Restructuring Transactions
(as defined in the Indenture) and any transactions related thereto shall not
constitute a Change of Control; and (E) a transaction will not be deemed to
involve a Change of Control in respect of a party if (1) such party becomes a

 

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direct or indirect wholly owned subsidiary of a holding company, and (2) the
direct or indirect owners of such holding company immediately following that
transaction are the same as the owners of such party immediately prior to that
transaction and the number and type of securities or other ownership interests
owned by each such direct and indirect holder immediately following such
transaction are materially unchanged from the number and type of securities or
other ownership interests owned by such direct and indirect holder in such party
immediately prior to that transaction.

“Commencement Date”: As defined in Section 2.2.

“Complimentary Golf Rounds”: Rounds of golf at the Golf Courses that are
(i) sponsored by User (i.e., paid for by User hereunder through the
Complimentary Golf Rounds Fee) and (ii) awarded by User (or User’s Affiliates)
to User’s (or User’s Affiliates’) guests on a complimentary basis in order to
encourage such guests to participate in Gaming Activities at User’s (or User’s
Affiliates’) casinos or for any other reason as determined by User (or User’s
Affiliates).

“Complimentary Golf Rounds Fee”: An annual amount payable as provided in Article
III, equal to the sum of (1) the aggregate of the Annual Minimum Rounds Fees for
all of the Golf Courses plus (2) the aggregate of the Annual Other Sponsored
Rounds Fees for all of the Golf Courses.

“Complimentary Golf Rounds Reimbursement Amount”: As defined in Section 3.5.

“Condemnation”: The exercise of any governmental power, whether by legal
proceedings or otherwise, by any public or quasi-public authority, or private
corporation or individual, having such power under Legal Requirements, either
under threat of condemnation or while legal proceedings for condemnation are
pending.

“Control”: The possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through
the ownership of voting securities, partnership interests or any other Equity
Interests or by contract, and “Controlling” and “Controlled” shall have meanings
correlative thereto.

“CPI”: The United States Department of Labor, Bureau of Labor Statistics Revised
Consumer Price Index for All Urban Consumers (1982-84=100), U.S. City Average,
All Items, or, if that index is not available at the time in question, then the
index designated by such Department as the successor to such index, and if there
is no index so designated, an index for an area in the United States that most
closely corresponds to the entire United States, published by such Department,
or if none, by any other instrumentality of the United States, all as reasonably
determined by Owner and User.

“CPI Increase”: The greater of (a) zero and (b) a fraction, expressed as a
decimal, determined as of each Escalator Adjustment Date, (x) the numerator of
which shall be the difference of (i) the average CPI for the three (3) most
recent calendar months (the “Prior Months”) ending prior to such Escalator
Adjustment Date (for which the CPI has been published as of such Escalator
Adjustment Date) minus (ii) the average CPI for the three (3) corresponding
calendar months occurring one (1) year prior to the Prior Months (such average
CPI, the “Beginning CPI”), and (y) the denominator of which shall be the
Beginning CPI.

 

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“CPLV Lease”: That certain Lease (CPLV), dated as of the date hereof, by and
among CPLV Property Owner LLC, a Delaware limited liability company, as
“Landlord”, and Desert Palace LLC, a Nevada limited liability company, Caesars
Entertainment Operating Company, Inc., a Delaware corporation, and CEOC, LLC, a
Delaware limited liability company (as successor by merger to Caesars
Entertainment Operating Company, Inc.), collectively as “Tenant”, as amended,
restated or otherwise modified from time to time.

“Cut-off Time”: As defined in Section 27.16.

“Dollars” and “$”: The lawful money of the United States.

“Environmental Laws”: Any and all federal, state, municipal and local laws,
statutes, ordinances, rules, regulations, orders, decrees or judgments, whether
statutory or common law, as amended from time to time, now or hereafter in
effect, or promulgated, pertaining to the environment, public health and safety
and industrial hygiene and relating to the use, generation, manufacture,
production, storage, release, discharge, disposal, handling, treatment, removal,
decontamination, cleanup, transportation or regulation of any Hazardous
Substance, including the Industrial Site Recovery Act, the Clean Air Act, the
Clean Water Act, the Toxic Substances Control Act, the Comprehensive
Environmental Response Compensation and Liability Act, the Resource Conservation
and Recovery Act, the Federal Insecticide, Fungicide, Rodenticide Act, the Safe
Drinking Water Act and relevant provisions of the Occupational Safety and Health
Act.

“Equity Interests”: With respect to any Person, any and all shares, interests,
participations, equity interests, voting interests 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 profit, and losses of, or distributions of assets of, such partnership.

“Escalator”: The sum of (a) one (1) plus (b) the greater of (i) two
one-hundredths (0.02) and (ii) the CPI Increase.

“Escalator Adjustment Date”: CES Use Fee Escalator Adjustment Date or Minimum
Rounds Rate Escalator Adjustment Date, as applicable.

“Estoppel Certificate”: As defined in Article XVIII.

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

“Existing Fee Mortgage”: The Fee Mortgages as in effect on the Commencement Date
(if any), together with any amendments, modifications, and/or supplements
thereto after the Commencement Date.

 

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“Expert”: An independent third party professional, with expertise in respect of
a matter at issue, appointed by the agreement of Owner and User or otherwise in
accordance with Section 27.5 hereof.

“Expiration Date”: The Stated Expiration Date, or such earlier date as this
Agreement is terminated pursuant to its terms.

“Fee Mortgage”: Any mortgage, pledge agreement, security agreement, assignment
of leases and rents, fixture filing or similar document creating or evidencing a
lien on Owner’s interest (which interest may be fee or leasehold) in the Golf
Courses or any portion thereof (or an indirect interest therein, including
without limitation, a lien on direct or indirect interests in Owner) in
accordance with the provisions of Article XXII hereof.

“Fee Mortgagee”: The holder(s) or lender(s) under any Fee Mortgage or the agent
or trustee acting on behalf of any such holder(s) or lender(s).

“Fiscal Quarter”: Each calendar quarter ending on
March 31, June 30, September 30 and December 31 of each year.

“Fiscal Year”: The annual period commencing January 1 and terminating
December 31 of each year.

“GAAP”: Generally accepted accounting principles in the United States
consistently applied in the preparation of financial statements, as in effect
from time to time.

“Gaming Activities”: The conduct of gaming or gambling activities, race books
and sports pools, or the use, manufacture, distribution or branding of gaming
devices, equipment and supplies in the operation of a casino, simulcasting
facility, card club or other enterprise, including, without limitation, slot
machines, video lottery terminals, gaming tables, cards, dice, gaming chips,
player tracking systems, cashless wagering systems, mobile gaming systems, poker
tournaments, inter-casino linked systems and related and associated equipment,
supplies and systems, and the distribution, sale or service of liquor. For
avoidance of doubt, the terms “gaming” and “gambling” as used in this Agreement
are intended to include the meanings of such terms under NRS 463.0153, and the
term “gaming device” as used in this Agreement is intended to include the
meaning of such term under NRS 463.0155.

“Gaming Authority” or “Gaming Authorities”: Individually or in the aggregate, as
the context may require, any foreign, federal, state or local governmental
entity or authority, or any department, commission, board, bureau, agency, court
or instrumentality thereof, regulating Gaming Activities or related activities
(including, but not limited to, the Nevada Gaming Commission, the Nevada State
Gaming Control Board and the Clark County Liquor and Gaming Licensing Board).

“Gaming Law”: Any applicable law regulating or otherwise pertaining to Gaming
Activities or related activities, including, but not limited to, the provisions
of the Nevada Gaming Control Act, as codified in NRS Chapter 463, as amended
from time to time, all regulations of the Nevada Gaming Commission promulgated
thereunder, as amended from time to time, the provisions of the Clark County
Code, as amended from time to time, and all other rules, regulations, orders,
ordinances and legal requirements of any Gaming Authority.

 

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“Gaming License”: “Gaming License” as defined in the Non-CPLV Lease.

“Golf Course” or “Golf Courses”: As defined in Section 2.1(a).

“Golf Course Use Payments”: Collectively, the Membership Fee, the CES Use Fee
and the Complimentary Golf Rounds Fee.

“Golf TRS”: VICI Golf LLC, a Delaware limited liability company, the parent of
Owner.

“Ground Leased Golf Courses”: Collectively, the Golf Courses leased pursuant to
the Ground Leases. The Ground Leased Golf Courses in respect of the Ground
Leases in effect as of the Commencement Date are described in Exhibit A-2
attached hereto. Each of the Ground Leased Golf Courses is referred to
individually herein as a “Ground Leased Golf Course.”

“Ground Leases”: Collectively, those certain leases with respect to certain of
the Golf Courses, pursuant to which Owner is a tenant and which leases are in
effect as of the Commencement Date and listed on Exhibit A-2 hereto or, subject
to Section 7.3, subsequently added to the Golf Courses in accordance with the
provisions of this Agreement. Each of the Ground Leases is referred to
individually herein as a “Ground Lease.”

“Ground Lessor”: As defined in Section 7.3.

“Hazardous Substances”: Collectively, any petroleum, petroleum product or by
product or any substance, material or waste regulated pursuant to any
Environmental Law.

“Indenture”: That certain First-Priority Senior Secured Floating Rate Notes due
2022 Indenture dated October 6, 2017, among PropCo 1, VICI FC Inc., a Delaware
corporation, VICI NC LLC, a Delaware limited liability company, the Subsidiary
Guarantors (as defined therein) party thereto from time to time, and UMB Bank,
National Association, as trustee.

“Initial Stated Expiration Date”: As defined in Section 2.2.

“Initial Term”: As defined in Section 2.2.

“Joliet Lease”: That certain Lease (Joliet), dated as of the date hereof, by and
between Harrah’s Joliet Landco LLC, a Delaware limited liability company, as
“Landlord”, and Des Plaines Development Limited Partnership, a Delaware limited
partnership, as “Tenant”, as amended, restated or otherwise modified from time
to time.

“Landlord REIT”: VICI Properties Inc., a Maryland corporation, the indirect
parent of Owner.

“Leases”: Collectively or individually, as the context may require, the Non-CPLV
Lease, the CPLV Lease and the Joliet Lease.

 

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“Leased Property”: The “Leased Property” as defined in each of the Leases,
collectively or individually, as the context may require.

“Legal Requirements”: All applicable federal, state, county, municipal and other
governmental statutes, laws (including securities laws), rules, policies,
guidance, codes, orders, regulations, ordinances, permits, licenses, covenants,
conditions, restrictions, judgments, decrees and injunctions, whether now or
hereafter enacted and in force, as applicable to any Person or to any Golf
Course, including those (a) that affect either the Golf Courses or any portion
thereof, or otherwise in any way affecting the business operated or conducted
thereat, as the context requires, and (b) which may regulate the transport,
handling, use, storage or disposal or require the cleanup or other treatment of
any Hazardous Substance.

“License Term”: As defined in Section 2.1(c).

“Licensed Trademarks”: All rights in, to and under the trademarks, service marks
and domain names set forth on Exhibit G hereto, including the registrations
shown on Exhibit G therefor, and the reputation symbolized by the foregoing.

“Membership Fee”: An annual amount payable as provided in Article III, in an
initial amount equal to Ten Million and No/100 Dollars ($10,000,000.00) per
Usage Year. The Membership Fee shall be increased or decreased, as applicable,
to be equal to the Adjusted Membership Fee, from time to time, any time the
monthly amount of Rent required to be paid under the Non-CPLV Lease is adjusted
in accordance with the terms of the Non-CPLV Lease, in which event such Adjusted
Membership Fee shall be deemed to be the Membership Fee for purposes hereof.

“Membership Fee Reduction Amount”: With respect to any Severance Agreement, a
proportionate reduction of the Membership Fee, which proportionate amount shall
be equal to the product of (a) the then-applicable Membership Fee (i.e., the
Membership Fee immediately prior to the applicable adjustment) multiplied by
(b) a fraction, (x) the numerator of which shall be the amount(s) related to the
applicable Golf Course(s) that is the subject of such Severance Agreement set
forth in the “Total” column on Exhibit D, and (y) the denominator of which shall
be Three Million and No/100 Dollars ($3,000,000.00).

“Membership Fee Retainage Election”: As defined in Section 16.2.

“Minimum Rounds Per Month”: As defined in Section 2.1.

“Minimum Rounds Per Year”: As defined in Section 2.1.

“Minimum Rounds Rate”: For each Golf Course, the rate to be used in calculating
the applicable Monthly Minimum Rounds Fee or the applicable Annual Minimum
Rounds Fee (as the case may be) for such Golf Course, determined as follows: For
the period commencing on the Commencement Date and ending on December 31, 2018,
the Minimum Rounds Rate for each Golf Course shall be the corresponding rate set
forth on Exhibit E-1 for such Golf Course. The Minimum Rounds Rate for each Golf
Course shall thereafter be adjusted annually as set forth in the following
sentence. On each Minimum Rounds Rate Escalator Adjustment Date during the Term,
the Minimum Rounds Rate for each Golf Course for such calendar year shall be
adjusted to be equal to the applicable Minimum Rounds Rate for such Golf Course
during the immediately preceding calendar year, multiplied by the Escalator.

 

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“Minimum Rounds Rate Escalator Adjustment Date”: The first day of each Fiscal
Year commencing on January 1, 2019.

“Minimum Rounds Reduction Amount”: A proportionate reduction of the minimum
number of Complimentary Golf Rounds applicable in determining the Minimum Rounds
Per Month and the Minimum Rounds Per Year, which proportionate amount shall be
determined in accordance with the following sentence. In the event that this
Agreement terminates (or expires) with respect to any Golf Course(s) (including
any Ground Leased Golf Course(s)) pursuant to Section 7.3, Section 11.2(a),
Section 11.2(b), Section 12.1(a), Section 12.1(b), Section 12.3 or Article XVI,
the above-described proportionate amount shall be equal to (a) in the case of
the Minimum Rounds Per Month, the amount(s) related to the applicable Golf
Course(s) for which this Agreement terminates (or expires) set forth in each
“Minimum # of Complimentary Golf Rounds Per Month (Minimum Rounds Per Month)”
column on Exhibit E-1, and (b) in the case of the Minimum Rounds Per Year, the
amount(s) related to the applicable Golf Course(s) for which this Agreement
terminates (or expires) set forth in the “Total (Minimum Rounds Per Year)”
column on Exhibit E-1.

“MLSA”: The “MLSA” as defined in the Non-CPLV Lease.

“Monthly Invoice”: As defined in Section 3.4.

“Monthly Minimum Rounds Fee”: With respect to each Golf Course, a monthly amount
equal to the product of (1) the applicable Minimum Rounds Rate for such Golf
Course multiplied by (2) the applicable number of Minimum Rounds Per Month for
such Golf Course.

“Monthly Other Sponsored Rounds Fee”: With respect to each Golf Course, a
monthly amount equal to the aggregate of the Other Sponsored Rounds Charges for
all of the Other Sponsored Rounds For The Month at such Golf Course.

“Non-CPLV Lease”: That certain Lease (Non-CPLV), dated as of the date hereof, by
and among the entities listed on Schedule A thereto, collectively as “Landlord”,
and CEOC, LLC, a Delaware limited liability company, and the entities listed on
Schedule B thereto, collectively as “Tenant”, as amended, restated or otherwise
modified from time to time.

“Non-CPLV Tenant”: The “Tenant” as defined in the Non-CPLV Lease.

“Notice”: A notice given in accordance with Article XXIV.

“NRS”: The Nevada Revised Statutes, as amended or supplemented from time to
time.

“OFAC”: As defined in Article XXVI.

“Other Sponsored Rounds Charge”: For each of the Other Sponsored Rounds For The
Year or each of the Other Sponsored Rounds For The Month (as the case may be),
an amount equal to seventy-five percent (75%) of the then applicable Tee Sheet
Rate.

 

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“Other Sponsored Rounds For The Month”: With respect to each Golf Course, all
Complimentary Golf Rounds, to the extent in excess of the Minimum Rounds Per
Month, at such Golf Course during the applicable calendar month.

“Other Sponsored Rounds For The Year”: With respect to each Golf Course, all
Complimentary Golf Rounds, to the extent in excess of the Minimum Rounds Per
Year, at such Golf Course during the applicable calendar year.

“Overdue Rate”: On any date, a rate equal to five (5) percentage points above
the Prime Rate, but in no event greater than the maximum rate then permitted
under applicable law.

“Owner”: As defined in the preamble.

“Owner Event of Default”: As defined in Section 13.3.

“Owner Indemnified Parties”: As defined in Article XV.

“Owner Licensing Event”: (a) Either (1) a communication (whether oral or in
writing) by or from any Gaming Authority to User or any of its Affiliates or
other action by any Gaming Authority that indicates that such Gaming Authority
may find that, or (2) a determination by User, in its sole but reasonable
discretion and pursuant to customary internal processes that, the association of
any member of the Owner Subject Group with User or any of its Affiliates is
likely to (i) result in a disciplinary action relating to, or the loss of,
inability to reinstate or failure to obtain, any registration, application or
license or any other rights or entitlements held or required to be held by User
or any of its Affiliates under any Gaming Law, or (ii) violate any Gaming Law to
which User or any of its Affiliates is subject; or (b) any member of the Owner
Subject Group is required to be licensed, registered, qualified or found
suitable under any Gaming Law, and such Person is not or does not remain so
licensed, registered, qualified or found suitable within any applicable
timeframes required by the applicable Gaming Authority, or, after becoming so
licensed, registered, qualified or found suitable, fails to remain so. For
purposes of this definition, an “Affiliate” of User includes any Person for
which User or its Affiliate is providing management services.

“Owner Rights and Privileges”: As defined in Section 2.1.

“Owner Subject Group”: Owner, Owner’s Affiliates and its and their principals,
direct or indirect shareholders, officers, directors, agents, employees and
other related Persons (including in the case of any trusts or similar Persons,
the direct or indirect beneficiaries of such trust or similar Persons),
excluding User and its Affiliates.

“Owner’s Statement”: As defined in Section 3.5.

“Parent Entity”: With respect to any Person, any corporation, association,
limited partnership, limited liability company or other entity which at the time
of determination (a) owns or controls, directly or indirectly, more than fifty
percent (50%) of the total voting power of shares of capital stock (without
regard to the occurrence of any contingency) entitled to vote in

 

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the election of directors, managers or trustees of such Person, (b) owns or
controls, directly or indirectly, more than fifty percent (50%) of the capital
accounts, distribution rights, total equity and voting interests or general and
limited partnership interests, as applicable, of such Person, whether in the
form of membership, general, special or limited partnership interests or
otherwise, or (c) is the controlling general partner or managing member of, or
otherwise controls, such entity.

“Partial Taking”: As defined in Section 12.1(b).

“Party” and “Parties”: Owner and/or User, as the context requires.

“Payment Date”: Any due date for the payment of the installments of Golf Course
Use Payments or Additional Charges payable under this Agreement.

“Permitted User Lender”: The lender or noteholder or other investor or any agent
or trustee or similar representative on behalf of one or more lenders or
noteholders or other investors in connection with indebtedness secured by a
Permitted User Security Instrument, in each case as and to the extent such
Person has the power to act (subject to obtaining the requisite instructions) on
behalf of all lenders, noteholders or other investors with respect to such
Permitted User Security Instrument; provided such lender or noteholder or other
investor or such agent or trustee or similar representative (but not necessarily
the lenders, noteholders or other investors which it represents) is a banking or
other institution that in the ordinary course acts as a lender, agent or trustee
or similar representative (in each case, on behalf of a group of lenders or
noteholders) in respect of financings of similar size as the Tenant’s Initial
Financing; and provided, further, that, in all events, (i) no agent, trustee or
similar representative shall be User, CEOC, CEC or any of their Affiliates,
respectively (each, a “ Prohibited Agent”), and (ii) no (A) Prohibited Agent
(excluding any Person that is a Prohibited Agent as a result of its ownership of
publicly-traded shares in any Person), or (B) entity that owns, directly or
indirectly (but excluding any ownership of publicly-traded shares in CEC or any
of its Affiliates), higher than the lesser of (1) ten percent (10%) of the
Equity Interests in User or (2) a Controlling legal or beneficial interest in
User, may collectively hold an amount of the indebtedness secured by a Permitted
User Security Instrument higher than the lesser of (x) twenty-five percent
(25%) thereof and (y) the principal amount thereof required to satisfy the
threshold for requisite consenting lenders to amend the terms of such
indebtedness that affect all lenders thereunder.

“Permitted User Security Instrument”: Any security agreement, pledge agreement
or similar document creating or evidencing a lien on User’s interest in this
Agreement (or all the direct or indirect interest therein at any tier of
ownership, including without limitation, a lien on direct or indirect Equity
Interests in User), granted to or for the benefit of a Permitted User Lender as
security for the indebtedness of User or its Affiliates.

“Person”: Any individual, corporation, limited liability company, partnership,
joint venture, association, joint stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other form of entity.

 

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“Primary Intended Use”: (i) Eighteen (18) hole golf course and related uses,
(ii) ancillary retail use, (iii) such other uses required under any Legal
Requirements (including those mandated by any applicable regulators), (iv) such
other ancillary uses, but in all events consistent with the current use of the
Golf Courses or any portion thereof as of the Commencement Date or with
then-prevailing golf course industry use (including developing, altering and/or
improving portions of the property on which any Golf Course is situated as
expressly permitted by the last sentence of Section 2.1(a)(i) and otherwise
provided by this Agreement), and/or (v) such other use as shall be agreed to by
Owner and User from time to time in their reasonable discretion.

“Prime Rate”: On any date, a rate equal to the annual rate on such date publicly
announced by JPMorgan Chase Bank, N.A. (provided that if JPMorgan Chase Bank,
N.A. ceases to publish such rate, the Prime Rate shall be determined according
to the comparable prime rate of another comparable nationally known money center
bank reasonably selected by Owner), to be its prime rate for ninety (90)-day
unsecured loans to its corporate borrowers of the highest credit standing, but
in no event greater than the maximum rate then permitted under applicable law.

“Prior Months”: As defined in the definition of CPI Increase.

“Products and Materials”: All products, merchandise and other materials, in any
format now or hereafter known, bearing or incorporating any of the Licensed
Trademarks, which identify or promote the Rio Secco Golf Course, or goods or
services offered thereby or in connection therewith, including goods, packaging,
labeling, point-of-sale materials, websites, social media pages, trade show
displays, sales materials and advertising.

“Prohibited Agent”: As defined in the definition of Permitted User Lender.

“Prohibited Persons”: As defined in Article XXVI.

“PropCo”: VICI Properties L.P., a Delaware limited partnership.

“PropCo 1”: VICI Properties 1 LLC, a Delaware limited liability company.

“Protected Names”: As defined in Section 27.13.

“Renewal Notice”: As defined in Section 2.3.

“Renewal Term”: As defined in Section 2.3.

“Rent”: “Rent” as defined in the Non-CPLV Lease.

“Representatives”: With respect to any Person, such Person’s officers,
employees, directors, accountants, attorneys and other consultants, experts or
agents of such Person, and actual or prospective arrangers, underwriters,
investors or lenders with respect to indebtedness or Equity Interests that may
be issued by such Person, to the extent that any of the foregoing actually
receives non-public information hereunder. In addition, and without limitation
of the foregoing, the term “Representatives” shall include, (a) in the case of
Owner, PropCo 1, PropCo, Landlord REIT, Golf TRS and any Affiliate thereof, and
(b) in the case of User, CEOC, CEC and any Affiliate thereof.

 

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“Rio”: Rio Properties, LLC, a Nevada limited liability company.

“Rio Secco Golf Course”: The Rio Secco golf course property located in
Henderson, Nevada as of the Commencement Date.

“SEC”: The United States Securities and Exchange Commission.

“Section 27.5 Dispute”: As defined in Section 27.5.

“Severance Agreement”: A separate agreement with respect to a Golf Course,
created when Owner transfers any individual Golf Course (or several Golf Courses
but not all of the Golf Courses), which agreement shall comply with the
requirements set forth in Article XVI hereof.

“Stated Expiration Date”: As defined in Section 2.2.

“Subsidiary”: As to any Person, (i) any corporation more than fifty percent
(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 of determination 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 fifty
percent (50%) Equity Interest at the time of determination.

“Taking”: Any taking of all or any part of the Golf Courses or any part thereof,
in or by Condemnation, including by reason of the temporary requisition of the
use or occupancy of all or any part of the Golf Courses by any governmental
authority, civil or military.

“Tee Sheet Rate”: With respect to an individual round of golf at a particular
Golf Course, the applicable rate which a walk-in member of the general public
would be charged to play such round of golf at such Golf Course if such member
did not pay a reduced rate based on any discount associated with such member’s
stay at any local resort or casino, including those operated by User,
promotional code, coupon or other discount.

“Tenant Event of Default”: “Tenant Event of Default” as defined in the Non-CPLV
Lease.

“Tenant’s Initial Financing”: The “Tenant’s Initial Financing” as defined in the
Non-CPLV Lease.

“Term”: As defined in Section 2.2.

“Unavoidable Delay”: Delays due to strikes, lockouts, inability to procure
materials, power failure, acts of God, governmental restrictions, enemy action,
civil commotion, fire, unavoidable casualty or other causes beyond the
reasonable control of the Party responsible for performing an obligation
hereunder; provided, that lack of funds, in and of itself, shall not be deemed a
cause beyond the reasonable control of a Party.

 

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“Unsuitable for Its Primary Intended Use”: A state or condition of any
individual Golf Course such that by reason of a Partial Taking or a sale,
assignment, transfer or conveyance of a portion (but not all) of such Golf
Course pursuant to Section 16.1 (or other event, as applicable) such Golf Course
cannot, following restoration thereof (to the extent commercially practical and
solely with respect to a Partial Taking), be operated on a commercially
practicable basis as an eighteen (18) hole golf course, taking into account,
among other relevant economic factors, the amount of square footage and the
estimated revenue affected by such Partial Taking or such sale, assignment,
transfer or conveyance of a portion (but not all) of such Golf Course pursuant
to Section 16.1 (or other event, as applicable).

“Usage Year”: The first Usage Year of the Term shall be the period commencing on
the Commencement Date and ending on the last day of the calendar month in which
the first (1st) anniversary of the Commencement Date occurs, and each subsequent
Usage Year shall be each period of twelve (12) full calendar months after the
last day of the prior Usage Year, except that the final Usage Year of the Term
shall end on the Expiration Date.

“User”: As defined in the preamble.

“User Event of Default”: As defined in Section 13.1.

“User Indemnified Parties”: As defined in Article XV.

“User Licensing Event”: (a) Either (1) a communication (whether oral or in
writing) by or from any Gaming Authority to Owner or any of its Affiliates or
other action by any Gaming Authority that indicates that such Gaming Authority
may find that, or (2) a determination by Owner, in its sole but reasonable
discretion and pursuant to customary internal processes that, the association of
any member of the User Subject Group with Owner or any of its Affiliates is
likely to, (i) result in a disciplinary action relating to, or the loss of,
inability to reinstate or failure to obtain, any registration, application or
license or any other rights or entitlements held or required to be held by Owner
or any of its Affiliates under any Gaming Law, or (ii) violate any Gaming Law to
which Owner or any of its Affiliates is subject; or (b) any member of the User
Subject Group is required to be licensed, registered, qualified or found
suitable under any Gaming Law, and such Person is not or does not remain so
licensed, registered, qualified or found suitable within any applicable
timeframes required by the applicable Gaming Authority, or, after becoming so
licensed, registered, qualified or found suitable, fails to remain so. For
purposes of this definition, an “Affiliate” of Owner includes any Person for
which Owner or its Affiliate is providing management services.

“User Rights and Privileges”: As defined in Section 2.1.

“User Subject Group”: User, User’s Affiliates and its and their principals,
direct or indirect shareholders, officers, directors, agents, employees and
other related Persons (including in the case of any trusts or similar Persons,
the direct or indirect beneficiaries of such trust or similar Persons),
excluding Owner and its Affiliates.

 

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ARTICLE II

GRANT OF LICENSE; TERM

2.1 Golf Courses; Rights and Privileges; Minimum Rounds; Trademark License.

(a) User and Owner Rights and Privileges.

(i) Upon and subject to the terms and conditions hereinafter set forth, Owner
grants to User, and User accepts from Owner, certain priority rights and
privileges with respect to access and use of the golf course properties
described on Exhibit A-1 attached hereto (each, a “Golf Course”; collectively,
the “Golf Courses”) as more particularly set forth on Exhibit B attached hereto
(collectively, the “User Rights and Privileges”). Such User Rights and
Privileges are granted subject to all covenants, conditions, restrictions,
easements and other matters of any nature, whether or not of record, affecting
the Golf Courses or any portion thereof as of the Commencement Date and such
subsequent covenants, conditions, restrictions, easements and other matters of
any nature, whether or not of record, affecting the Golf Courses or any portion
thereof that do not materially and adversely affect User’s rights under this
Agreement or as may otherwise be agreed to in writing by Owner and User, whether
or not of record, including any matters which would be disclosed by an
inspection or accurate survey of the Golf Courses or any portion thereof. With
respect to each Golf Course, Owner shall have the right to enter into any
covenants, conditions, restrictions, easements and other matters of any nature,
whether or not of record, affecting such Golf Course or any portion thereof
without having agreed to same in writing with User but Owner may do so only if
and to the extent the same does not render such Golf Course Unsuitable for Its
Primary Intended Use. In addition, Owner shall have the right to develop, alter
and/or improve portions of the property on which any Golf Course is situated for
other uses but Owner may do so only if and to the extent that doing so does not
render such Golf Course Unsuitable for Its Primary Intended Use.

(ii) In consideration of the foregoing grant of the User Rights and Privileges,
User shall (A) pay to Owner the Membership Fee and the CES Use Fee (as more
particularly described in Article III), (B) provide to Owner (or cause User’s
Affiliates to provide to Owner) the rights and privileges set forth on Exhibit C
attached hereto (collectively, the “Owner Rights and Privileges”) and
(C) sponsor (i.e., pay for, and use commercially reasonable efforts to refer to
Owner), on a monthly basis, the Aggregate Minimum Rounds Per Month and, on an
annual basis, the Aggregate Minimum Rounds Per Year (as more particularly
described in Section 2.1(b) below).

(b) Minimum Rounds.

(i) User agrees to use commercially reasonable efforts to refer to Owner, at
each Golf Course, a minimum number of Complimentary Golf Rounds per calendar
year as more particularly set forth on Exhibit E-1 attached hereto
(collectively, the “Minimum Rounds Per Year”), which Minimum Rounds Per Year
shall be apportioned among each calendar month during each such calendar year as
more particularly set forth on Exhibit E-1 attached hereto (collectively, the
“Minimum Rounds Per Month”), in each case as such amounts may be reduced by the
applicable Minimum Rounds Reduction Amount as described in Section 7.3,
Section 11.2(a), Section 11.2(b), Section 12.1(a), Section 12.1(b), Section 12.3
and Article XVI.

 

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(ii) In consideration of the tee times that will be reserved (i.e., set aside)
by Owner in order to accommodate the Aggregate Minimum Rounds Per Year and any
Other Sponsored Rounds For The Year (as applicable), User shall pay to Owner the
Complimentary Golf Rounds Fee (as more particularly described in Article III).
For the avoidance of doubt, User’s failure to refer to Owner, at each Golf
Course, the Minimum Rounds Per Year shall in no way affect User’s obligation to
pay to Owner the portion of the Complimentary Golf Rounds Fee attributable to
the aggregate of the Annual Minimum Rounds Fees for all of the Golf Courses.

(c) Trademark License. Subject to the terms and provisions set forth in this
Agreement, CLC hereby grants to Owner, and Owner hereby accepts, a worldwide,
royalty-free and non-transferable right and sublicense, for a term of eight
(8) years from the Commencement Date (the “License Term”), to use the Licensed
Trademarks solely (x) in connection with the operation, advertising, marketing
and promotion of the Rio Secco Golf Course and (y) on or in connection with the
use, manufacture, marketing, promotion, distribution, offer for sale and sale of
Products and Materials. Owner acknowledges and agrees that the Licensed
Trademarks are owned by Rio and licensed to CLC. Owner therefore agrees to
comply with the terms and conditions applicable to sublicensees of the Licensed
Trademarks, as set forth on Exhibit H hereto. The sublicense granted pursuant to
this Section 2.1(c) shall be non-exclusive, except that such license shall be
exclusive as to CES and its subsidiaries (including CLC); provided, that CES and
its subsidiaries (including CLC) may continue to use the Licensed Trademarks and
reference the Rio Secco Golf Course as necessary to comply with the terms and
conditions of this Agreement (including, e.g., for promotional purposes in
connection with the User Rights and Privileges set forth on Exhibit B hereto).

2.2 Term. The term of this Agreement (the “Term”) shall commence on the
Commencement Date and expire on the Expiration Date (i.e., the Term shall
consist of the Initial Term plus all Renewal Terms, to the extent exercised as
set forth in Section 2.3 below, subject to any earlier termination of the Term
pursuant to the terms hereof). The initial stated term of this Agreement (the
“Initial Term”) shall commence on October 6, 2017 (the “Commencement Date”) and
expire on October 31, 2032 (the “Initial Stated Expiration Date”). The “Stated
Expiration Date” means the Initial Stated Expiration Date or the expiration date
of the most recently exercised Renewal Term, as the case may be. Notwithstanding
the foregoing or anything to the contrary contained herein, (a) if all of the
Leases terminate in accordance with their respective terms, then, simultaneously
with such termination of the Lease that terminates last, this Agreement shall
automatically terminate, and (b) this Agreement may be terminated by User with
respect to one or more Golf Courses, provided that any such termination pursuant
to this clause (b) shall not relieve or diminish User’s obligation to pay the
full amount of the Membership Fee as provided herein, which obligation shall
survive the termination of this Agreement until all of the Leases have
terminated in accordance with their respective terms, nor relieve or diminish
CEC’s obligations under the MLSA.

2.3 Renewal Terms. The Term may be extended for four (4) separate “Renewal
Terms” of five (5) years each if (a) at least twelve (12), but not more than
eighteen (18), months prior to the then current Stated Expiration Date, User
delivers to Owner a “Renewal Notice” stating that it is irrevocably exercising
its right to extend this Agreement for one (1) Renewal Term; and (b) no User
Event of Default shall have occurred and be continuing on the date Owner

 

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receives the Renewal Notice or on the last day of the then current Term (other
than an User Event of Default that is in the process of being cured by a
Permitted User Lender in compliance in all respects with Section 17.2). Subject
to the provisions, terms and conditions of this Agreement, upon User’s timely
delivery to Owner of a Renewal Notice, the Term shall be extended for the then
applicable Renewal Term. During any such Renewal Term, except as specifically
provided for herein, all of the provisions, terms and conditions of this
Agreement shall remain in full force and effect. After the last Renewal Term,
User shall have no further right to renew or extend the Term. If User fails to
validly and timely exercise any right to extend this Agreement, then all
subsequent rights to extend the Term shall terminate. Notwithstanding the
foregoing or anything to the contrary contained herein, (i) if any right to
extend the term of any of the Leases is validly and timely exercised pursuant to
Section 1.4 of such Lease, then (A) User shall be required to exercise the
corresponding right to extend this Agreement for the corresponding Renewal Term
hereunder, (B) User shall be deemed to have validly and timely exercised such
right to extend this Agreement described in the foregoing clause (A), and
(C) this Agreement shall automatically be extended for the applicable Renewal
Term without any further action by User, and (ii) if all of the rights to extend
the terms of the Leases fail to be validly and timely exercised pursuant to
Section 1.4 of each of the Leases, then all corresponding and subsequent rights
to extend the Term hereunder shall terminate and User shall not have any right
to extend this Agreement.

ARTICLE III

GOLF COURSE USE PAYMENTS

3.1 Payment of Membership Fee and CES Use Fee.

(a) Generally. During the Term, User will pay to Owner each of the Golf Course
Use Payments and Additional Charges in lawful money of the United States of
America and legal tender for the payment of public and private debts, in the
manner provided in Section 3.3. On the Commencement Date, a prorated portion of
the first monthly installment of the Membership Fee shall be paid by User for
the period from the Commencement Date until the last day of the calendar month
in which the Commencement Date occurs, based on the number of days during such
period. Thereafter, the Membership Fee shall be payable by User in consecutive
monthly installments equal to one-twelfth (1/12th) of the Membership Fee amount
for the applicable Usage Year on the first (1st) day of each calendar month (or
the immediately preceding Business Day if the first (1st) day of the month is
not a Business Day), in advance for such calendar month, during that Usage Year.
With respect to the CES Use Fee, (i) on the Commencement Date, a prorated
portion of the first quarterly installment of the CES Use Fee shall be paid by
User for the period from the Commencement Date until the last day of the
calendar quarter in which the Commencement Date occurs, based on the number of
days during such period, and (ii) thereafter, the CES Use Fee shall be payable
by User in consecutive quarterly installments equal to one-fourth (1/4th) of the
CES Use Fee amount for the applicable Usage Year on the first (1st) day of each
calendar quarter (or the immediately preceding Business Day if the first
(1st) day of the quarter is not a Business Day), in advance for such calendar
quarter, during that Usage Year. The Complimentary Golf Rounds Fee shall be
payable in accordance with the terms and provisions of Section 3.5 below.

 

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(b) Proration for Partial Usage Year. Unless otherwise agreed by the Parties in
writing, the Golf Course Use Payments shall each be prorated on a per diem basis
as to any Usage Year containing less than twelve (12) full calendar months, and
with respect to any installment thereof due for any partial months at the
beginning and end of the Term.

3.2 Late Payment. User hereby acknowledges that the late payment by User to
Owner of any of the Golf Course Use Payments or Additional Charges will cause
Owner to incur costs not contemplated hereunder, the exact amount of which is
presently anticipated to be extremely difficult to ascertain. Accordingly, if
any installment of any of the Golf Course Use Payments or Additional Charges
payable directly to Owner shall not be paid within four (4) days after its due
date, User shall pay to Owner on demand a late charge equal to the lesser of
(a) five percent (5%) of the amount of such installment or Additional Charges
and (b) the maximum amount permitted by law. The Parties agree that this late
charge represents a fair and reasonable estimate of the costs that Owner will
incur by reason of late payment by User. The Parties further agree that any such
late charge constitutes Golf Course Use Payments or Additional Charges (as
applicable), and not interest, and such assessment does not constitute a lender
or borrower/creditor relationship between Owner and User. If any installment of
any of the Golf Course Use Payments (or Additional Charges payable directly to
Owner) shall not be paid within nine (9) days after its due date, the amount
unpaid, including any late charges previously accrued and unpaid, shall bear
interest at the Overdue Rate (from such ninth (9th) day after the due date of
such installment until the date of payment thereof) (including interest accruing
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, whether or not a claim for such interest is allowed or allowable in
such proceeding), and User shall pay such interest to Owner on demand. The
payment of such late charge or such interest shall not constitute a waiver of,
nor excuse or cure, any default under this Agreement, nor prevent Owner from
exercising any other rights and remedies available to Owner. No failure by Owner
to insist upon strict performance by User of User’s obligation to pay late
charges and interest on sums overdue shall constitute a waiver by Owner of its
right to enforce the provisions, terms and conditions of this Section 3.2. No
payment by User nor receipt by Owner of a lesser amount than may be required to
be paid hereunder shall be deemed to be other than on account of any such
payment, nor shall any endorsement or statement on any check or any letter
accompanying any check tendered as payment be deemed an accord and satisfaction
and Owner, in its sole discretion, may accept such check or payment without
prejudice to Owner’s right to recover the balance of such payment due or pursue
any other right or remedy in this Agreement provided.

3.3 Method of Payment. Each of the Golf Course Use Payments and Additional
Charges to be paid to Owner shall be paid by electronic funds transfer debit
transactions through wire transfer, ACH or direct deposit of immediately
available federal funds and shall be initiated by User for settlement on or
before the applicable Payment Date in each case (or, in respect of Additional
Charges, as applicable, such other date as may be applicable hereunder);
provided, however, if the Payment Date is not a Business Day, then settlement
shall be made on the preceding Business Day. Owner shall provide User with
appropriate wire transfer, ACH and direct deposit information in a Notice from
Owner to User. If Owner directs User to pay any of the Golf Course Use Payments
or any Additional Charges to any party other than Owner, User shall send to
Owner, simultaneously with such payment, a copy of the transmittal letter or
invoice and a check whereby such payment is made or such other evidence of
payment as Owner may reasonably require. No amounts due and payable under this
Agreement may be offset against any amounts due and payable under any other
agreement.

 

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3.4 Monthly Invoice. Within ten (10) Business Days after the end of each
calendar month during the Term, Owner shall furnish to User an invoice for all
Monthly Minimum Rounds Fees, Monthly Other Sponsored Rounds Fees and Additional
Charges (if any) which are then payable hereunder (each, a “Monthly Invoice”).
For the avoidance of doubt, each Monthly Invoice will be based solely on
activities at the Golf Courses for the calendar month to which such Monthly
Invoice relates, and any reconciliation credits or refunds will be applied
against the invoiced amounts only after the corresponding end-of-quarter
reconciliation (as more particularly described below) has been completed. Within
thirty (30) days following the date of the giving of a Monthly Invoice (which
shall be determined in accordance with Article XXIV hereof), User shall pay to
Owner all amounts set forth on such Monthly Invoice. No delay by Owner in
providing any statement, invoice or billing (including, without limitation, any
Monthly Invoice or any Owner’s Statement) to User shall be deemed a default by
Owner or a waiver of amounts due to Owner. User’s failure to object to any
statement, invoice or billing by Owner (including, without limitation, any
Monthly Invoice or any Owner’s Statement) within ninety (90) days after the date
of the giving thereof (which shall be determined in accordance with Article XXIV
hereof) shall constitute User’s approval of, and waiver of any objection to,
such statement, invoice or billing and shall conclusively establish such
statement, invoice or billing as being in accordance with this Agreement.

3.5 Payment of Complimentary Golf Rounds Fee. Notwithstanding the foregoing or
anything to the contrary contained herein, the provisions of this Section 3.5
shall be applicable with respect to the Complimentary Golf Rounds Fee, and in
the event of any conflict between the provisions of this Section 3.5 and the
other provisions of this Article III, the provisions of this Section 3.5 shall
govern. Payments in respect of the Complimentary Golf Rounds Fee shall be made
by User to Owner, in consecutive monthly installments on or before the thirtieth
(30th) day following the date of the giving of each Monthly Invoice (which shall
be determined in accordance with Article XXIV hereof) (in arrears for the
calendar month to which such Monthly Invoice relates), and each such payment
shall include the applicable Monthly Minimum Rounds Fees and the applicable
Monthly Other Sponsored Rounds Fees for all of the Golf Courses (subject to
quarterly reconciliation as set forth below). Within forty-five (45) days after
the end of each calendar quarter during the Term, Owner shall furnish to User a
statement showing (a) the number of Complimentary Golf Rounds attributable to
such calendar quarter, (b) the year-to-date (as of the end of such calendar
quarter) number of Complimentary Golf Rounds attributable to the calendar year
of which such calendar quarter is a part, and (c) a calculation of the
Complimentary Golf Rounds Reimbursement Amount (if any) which is then owing
hereunder (each, an “Owner’s Statement”). Within thirty (30) days following the
date of the giving of an Owner’s Statement (which shall be determined in
accordance with Article XXIV hereof), Owner shall provide to User a credit
against payments in respect of the Complimentary Golf Rounds Fee next coming due
(or a refund if at the end of the Term, subject to Article XIII) in the amount
of the Complimentary Golf Rounds Reimbursement Amount (if any) set forth on such
Owner’s Statement. For purposes hereof, the term “Complimentary Golf Rounds
Reimbursement Amount” shall mean an amount equal to the difference of (i) the
aggregate amount of the installment payments theretofore made by User to Owner
in respect of the Complimentary Golf Rounds Fee pursuant to this Section 3.5
during the applicable calendar year, minus (ii) the sum of (A) the aggregate
amount of all Monthly Minimum Rounds Fees for all of the Golf Courses,

 

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on a year-to-date basis, payable for all of the months during such calendar
year, through and including such calendar quarter, plus (B) the aggregate amount
of the following for all of the Golf Courses: with respect to each Golf Course,
the product of (1) the greater of (x) zero (0), and (y) the difference of
(I) for such Golf Course, as applicable, the aggregate number of Complimentary
Golf Rounds at such Golf Course, on a year-to-date basis, for such calendar
year, through and including such calendar quarter, minus (II) for such Golf
Course, as applicable, the aggregate number of Minimum Rounds Per Month for such
Golf Course for all of the months during such calendar year, through and
including such calendar quarter, multiplied by (2) the applicable Other
Sponsored Rounds Charge for such Golf Course. For the avoidance of doubt, in
performing any end-of-quarter reconciliation, with respect to each Golf Course,
(aa) the aggregate year-to-date number of Complimentary Golf Rounds at such Golf
Course will be applied first towards satisfaction of each of the Minimum Rounds
Per Month for such Golf Course through and including the applicable calendar
quarter (and, in connection therewith, some or all of the Other Sponsored Rounds
For The Month at such Golf Course during the applicable calendar quarter may
ultimately be applied to satisfy the Minimum Rounds Per Month of a preceding, or
subsequent, month in the calendar year of which the applicable calendar quarter
is a part); and (bb) if the aggregate year-to-date number of Other Sponsored
Rounds For The Month for such Golf Course exceeds the aggregate year-to-date
number of unsatisfied Minimum Rounds Per Month for such Golf Course, then the
reconciliation will include an adjustment of the rate applicable to such excess
for purposes of calculating the Complimentary Golf Rounds Fee (i.e., the
applicable rate with respect to such excess will be the applicable Minimum
Rounds Rate for such Golf Course (rather than the then applicable Tee Sheet
Rate)).

ARTICLE IV

ADDITIONAL CHARGES

Owner and User acknowledge and agree that the Golf Course Use Payments are in
consideration of the User Rights and Privileges and the tee times to be reserved
(i.e., set aside) to accommodate the Aggregate Minimum Rounds Per Year and any
Other Sponsored Rounds For The Year (as applicable). In addition to the Golf
Course Use Payments, User shall (a) pay Owner for charges for goods and services
(other than greens fees) provided by Owner at the Golf Courses (e.g., food,
beverages and pro shop merchandise) to, or at the written request (which may be
via electronic mail) of, User, in each case in a manner consistent with past
practice, and (b) be responsible for other Additional Charges in accordance with
the applicable terms hereof.

ARTICLE V

NO TERMINATION, ABATEMENT, ETC.

Except as otherwise specifically provided in this Agreement, User shall remain
bound by this Agreement in accordance with its terms. The obligations of Owner
and User hereunder shall be separate and independent covenants and agreements
and each of the Golf Course Use Payments and all other sums payable by User
hereunder shall continue to be payable in all events unless the obligations to
pay the same shall be terminated pursuant to the express provisions of this
Agreement or by termination of this Agreement as to all of the Golf Courses as a
result of all of the Leases having been terminated in accordance with their
respective terms other than a

 

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termination of this Agreement by Owner pursuant to Section 13.2. Without
limitation of the preceding sentence, the respective obligations of Owner and
User shall not be affected by reason of, except as expressly set forth in
Articles XI and XII, (a) any damage to or destruction of the Golf Courses or any
portion thereof from whatever cause, or any Condemnation of the Golf Courses or
any portion thereof or, discontinuance of any service or utility servicing the
same; (b) the lawful or unlawful prohibition of, or restriction upon, User’s use
of the Golf Courses or any portion thereof or the interference with such use by
any Person; (c) any claim that User has or might have against Owner by reason of
any default or breach of any warranty by Owner hereunder or under any other
agreement between Owner and User or to which Owner and User are parties; (d) any
bankruptcy, insolvency, reorganization, consolidation, readjustment,
liquidation, dissolution, winding up or other proceedings affecting Owner or any
assignee or transferee of Owner; or (e) for any other cause, whether similar or
dissimilar to any of the foregoing. User hereby specifically waives all rights
arising from any occurrence whatsoever which may now or hereafter be conferred
upon it by law (i) to modify, surrender or terminate this Agreement, or
(ii) which may entitle User to any abatement, deduction, reduction, suspension
or deferment of or defense, counterclaim, claim or set-off against any of the
Golf Course Use Payments or other sums payable by User hereunder, except in each
case as may be otherwise specifically provided in this Agreement.

ARTICLE VI

OWNERSHIP OF GOLF COURSES

Owner and User acknowledge and agree that they have executed and delivered this
Agreement with the understanding that (i) the Golf Courses are the property of
Owner, (ii) User has only the right to access and use the Golf Courses upon the
terms and conditions of this Agreement, (iii) during the Term, each Golf Course
is an amenity relating to the Leased Property under the Leases as well as a
third-party business open to the public, (iv) the business relationship created
by this Agreement and any related documents is and at all times shall remain
that of licensor and User, (v) this Agreement has been entered into by each
Party in reliance upon the mutual covenants, conditions and agreements contained
herein, and (vi) none of the agreements contained herein is intended, nor shall
the same be deemed or construed, to create a partnership between Owner and User,
to make them joint venturers, to make User an agent, legal representative,
partner, subsidiary or employee of Owner, or to make Owner in any way
responsible for the debts, obligations or losses of User.

ARTICLE VII

PRESENT CONDITION & USE

7.1 Condition of the Golf Courses. User confirms that User has examined and
otherwise has knowledge of the condition of the Golf Courses prior to and as of
the execution and delivery of this Agreement and has found the same to be
satisfactory for its purposes hereunder, it being understood and acknowledged by
User that, immediately prior to Owner’s acquisition of the Golf Courses and
contemporaneous entry into this Agreement, User (or its Affiliates) was the
owner of all of Owner’s interest in and to the Golf Courses and, accordingly,
User is charged with, and deemed to have, full and complete knowledge of all
aspects of the

 

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condition and state of the Golf Courses as of the Commencement Date. Without
limitation of the foregoing and regardless of any examination or inspection made
by User, and whether or not any patent or latent defect or condition was
revealed or discovered thereby, User is using the Golf Courses “as is” in its
present condition. Without limitation of the foregoing, User waives any claim or
action against Owner in respect of the condition of the Golf Courses including
any defects or adverse conditions not discovered or otherwise known by User as
of the Commencement Date. OWNER MAKES NO WARRANTY OR REPRESENTATION OF ANY KIND,
EXPRESS OR IMPLIED, IN RESPECT OF THE GOLF COURSES OR ANY PART THEREOF,
INCLUDING AS TO ITS FITNESS FOR USE, DESIGN OR CONDITION FOR ANY PARTICULAR USE
OR PURPOSE OR OTHERWISE. This Section 7.1 shall not be construed to limit
Owner’s express indemnities made hereunder.

7.2 Use of the Golf Courses. During the Term, each Golf Course shall be used for
the Primary Intended Use.

7.3 Ground Leases.

(a) Subject to Section 7.3(b) and Section 7.3(c) below, in the event of
cancellation or termination of any Ground Lease for any reason whatsoever
whether voluntary or involuntary (by operation of law or otherwise) prior to the
Expiration Date (other than the cancellation or termination of a Ground Lease
entered into in connection with a sale-leaseback transaction by Owner (other
than if such cancellation or termination resulted from User’s default under this
Agreement), which cancellation or termination results in the Golf Course leased
under such Ground Lease no longer being subject to this Agreement), then this
Agreement shall remain in full force and effect and User’s obligation to pay
each of the Golf Course Use Payments (excluding the portion of the Complimentary
Golf Rounds Fee attributable to such Ground Leased Golf Course) and all
Additional Charges required by this Agreement, and all other obligations of User
hereunder (other than such obligations of User hereunder that concern solely the
applicable Ground Leased Golf Course demised under the affected Ground Lease
(including, without limitation, the obligations of User hereunder with respect
to the portion of the Complimentary Golf Rounds Fee attributable to such Ground
Leased Golf Course), which, for the avoidance of doubt, shall under no
circumstances include or be deemed to include the obligations of User hereunder
with respect to all or any portion of the Membership Fee), shall continue
unabated (and, for the avoidance of doubt, the Minimum Rounds Per Month and the
Minimum Rounds Per Year shall each be adjusted in accordance with the Minimum
Rounds Reduction Amount (and the Complimentary Golf Rounds Fee shall be
re-determined in connection therewith)); provided that if Owner enters into a
replacement lease with respect to the applicable Ground Leased Golf Course on
substantially similar terms to those of such cancelled or terminated Ground
Lease, then such replacement lease shall automatically become a Ground Lease
hereunder and such Ground Leased Golf Course shall remain part of the Golf
Courses hereunder. Nothing contained in this Agreement shall create, or be
construed as creating, any privity of contract or privity of estate between the
lessor under any applicable Ground Lease (in each case, the “Ground Lessor”) and
User.

(b) With respect to any Ground Leased Golf Course, the Ground Lease for which
has an expiration date (taking into account any renewal options exercised
thereunder as of the Commencement Date or hereafter exercised) prior to the
Expiration Date, this Agreement shall

 

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expire solely with respect to such Ground Leased Golf Course concurrently with
such Ground Lease expiration date (taking into account the following sentences
of this Section 7.3(b)). There shall be no reduction in any of the Golf Course
Use Payments by reason of such expiration with respect to, and the corresponding
removal from this Agreement of, any such Ground Leased Golf Course, except that
the portion of the Complimentary Golf Rounds Fee attributable to such Ground
Leased Golf Course shall no longer constitute a part of the Golf Course Use
Payments (and, for the avoidance of doubt, the Minimum Rounds Per Month and the
Minimum Rounds Per Year shall each be adjusted in accordance with the Minimum
Rounds Reduction Amount (and the Complimentary Golf Rounds Fee shall be
re-determined in connection therewith)). Unless all of the rights to extend the
terms of the Leases fail to be validly and timely exercised pursuant to
Section 1.4 of each of the Leases, Owner (as ground lessee) shall be required to
(at the appropriate times) exercise all renewal options contained in each Ground
Lease so as to extend the term thereof, and Owner shall provide User with a copy
of Owner’s exercise of such renewal option.

(c) Notwithstanding anything to the contrary set forth in this Agreement, in the
event that, despite any cancellation or termination of any Ground Lease for any
reason whatsoever whether voluntary or involuntary (by operation of law or
otherwise), Owner continues to be able to make available to User use of the
applicable Ground Leased Golf Course demised under the affected Ground Lease for
the Primary Intended Use, then all rights and obligations of Owner and User with
respect to such Ground Leased Golf Course shall continue in full force and
effect.

(d) Nothing contained in this Agreement amends, or shall be construed to amend,
any provision of the Ground Leases.

ARTICLE VIII

REPRESENTATIONS AND WARRANTIES

Each Party represents and warrants to the other that as of the Commencement
Date: (i) this Agreement has been duly authorized and shall be binding upon it;
(ii) it is duly organized, validly existing and in good standing under the laws
of the state of its formation and, as applicable, is duly authorized and
qualified to perform this Agreement within the States where the Golf Courses are
located; and (iii) neither this Agreement nor any other document executed or to
be executed in connection herewith violates the terms of any other agreement of
such Party.

ARTICLE IX

MAINTENANCE, REPAIR AND OPERATIONS

Subject to the following provisions of this Article IX, Owner shall, at Owner’s
sole cost and expense, (a) operate, maintain, repair and replace the Golf
Courses, and every portion thereof, including, without limitation, undertaking
and performing capital improvements, in each case (i) in a manner substantially
consistent with the prior operating history of the Golf Courses and/or
applicable portion thereof, and (ii) in conformity in all material respects with
all Legal Requirements, and (b) be responsible for all taxes, utilities, and
other costs of ownership of the Golf Courses. Except to the extent necessary
during restoration after a Casualty Event, Taking

 

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or Condemnation, or necessary or appropriate for purposes of performing
maintenance and repairs and/or renovations in Owner’s (and only Owner’s)
business judgment, Owner shall keep the Golf Courses continuously open for
business and operating in the ordinary course. In the event that a Golf Course
closes as a result of any restoration or renovation, User’s obligation to pay
each of the Golf Course Use Payments and all Additional Charges required by this
Agreement shall remain unabated during the period that such Golf Course is
closed; except, however, if such Golf Course remains closed for six
(6) consecutive calendar months, then, during the period commencing on the day
immediately after the expiration of such 6-month period and ending on the day
immediately preceding the date on which such Golf Course reopens, User shall not
be required to (i) sponsor any portion of the Aggregate Minimum Rounds Per Month
and/or Aggregate Minimum Rounds Per Year that would have been attributable to
such Golf Course for such period had such Golf Course not been closed during
such period, or (ii) pay any portion of the Monthly Minimum Rounds Fee and/or
Annual Minimum Rounds Fee that would have been attributable to such Golf Course
for such period had such Golf Course not been closed during such period.
Notwithstanding anything to the contrary contained herein, (A) to the extent not
paid in full on or before the date hereof, User shall pay (or cause to be paid)
in full all costs and expenses for completing those capital improvements for the
Golf Courses (notwithstanding the amounts provided for on Exhibit F attached
hereto) that have either (1) commenced on or before the date hereof or (2) been
approved by User as of the date hereof (collectively, the “Approved Capital
Improvements”), which Approved Capital Improvements are more particularly
described on Exhibit F attached hereto, promptly following User’s receipt of an
invoice for the same, and (B) to the extent not complete on or before the date
hereof, User shall diligently prosecute completion of the Approved Capital
Improvements. User hereby represents and warrants to Owner that, as of the date
hereof, User has paid $1,892,839.36 with respect to the Approved Capital
Improvements.

ARTICLE X

INSURANCE

During the Term, Owner shall, at its own cost and expense, maintain the minimum
kinds and amounts of insurance described on Exhibit I attached hereto. Such
insurance shall apply to the ownership, maintenance, use and operations related
to the Golf Courses and all property located in or on the Golf Courses. All
policies shall be written with insurers authorized to do business in all States
where the Golf Courses are located and shall maintain A.M. Best ratings of not
less than “A-” “VII” or better in the most recent version of Best’s Key Rating
Guide. In the event that any of the insurance companies’ ratings fall below the
requirements set forth above, Owner shall have one hundred eighty (180) days
within which to replace such insurance company with an insurance company that
qualifies under the requirements set forth above. It is understood that Owner
may utilize so called Surplus lines companies and will adhere to the standard
above. In furtherance of the foregoing, Owner shall maintain, with financially
sound and reputable insurance companies, insurance (subject to customary
deductibles and retentions) in such amounts and against such risks as are
reasonable and customarily maintained by similarly situated companies engaged in
the same or similar businesses operating in the same or similar locations.
Certificates of insurance, evidencing the insurance coverage required by this
Article X shall be delivered to User as described on Exhibit I attached hereto.
The Parties hereby confirm that the amounts and types of insurance that Owner
has in effect as of the Commencement Date satisfies the requirements of this
Article X.

 

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ARTICLE XI

CASUALTY

11.1 Property Insurance Proceeds. All proceeds payable by reason of any property
loss or damage to the Golf Courses, or any portion thereof, under any property
policy of insurance required to be carried hereunder or otherwise maintained by
Owner shall be paid to Owner or as otherwise agreed between Owner and Fee
Mortgagee and, subject to the limitations set forth in this Article XI, used for
the repair of any damage to or restoration or reconstruction of the Golf
Courses, provided that the Golf Courses are rebuilt in a manner that is
substantially the same condition as existed immediately prior to the applicable
casualty or otherwise reasonably satisfactory to Owner. Any excess proceeds of
insurance remaining after the completion of the restoration or reconstruction of
the Golf Courses to substantially the same condition as existed immediately
before the damage or destruction and with materials and workmanship of like kind
and quality or otherwise to Owner’s reasonable satisfaction shall be paid to
Owner.

11.2 Owner’s Obligations Following Casualty

(a) Subject to Section 11.2(b) below, in the event of a Casualty Event with
respect to any individual Golf Course, (i) Owner shall restore such Golf Course
to substantially the same condition as existed immediately before such damage or
otherwise in a manner reasonably satisfactory to Owner and (ii) the damage
caused by the applicable Casualty Event shall not terminate this Agreement;
provided, however, that if the applicable Casualty Event shall occur not more
than two (2) years prior to the then-Stated Expiration Date and the cost to
restore the applicable Golf Course to the condition immediately preceding the
Casualty Event, as determined by a mutually approved contractor or architect,
would equal or exceed twenty-five percent (25%) of the fair market value (as
reasonably determined by the parties) of such Golf Course immediately prior to
the time of such damage or destruction, then each of Owner and User shall have
the option, exercisable in such Party’s sole and absolute discretion, to
terminate this Agreement with respect to such Golf Course, upon written notice
to the other Party hereto delivered to such other Party within thirty (30) days
of the determination of the amount of damage and the fair market value (as
reasonably determined by the parties) of such Golf Course and, if such option is
exercised by either Owner or User, (i) this Agreement shall terminate with
respect to such Golf Course and Owner shall not be required to restore such Golf
Course and any insurance proceeds payable as a result of the damage or
destruction shall be payable in accordance with Section 11.2(c), and
(ii) commencing upon the date of such termination, (A) the CES Use Fee shall be
adjusted in accordance with the CES Use Fee Reduction Amount and (B) the Minimum
Rounds Per Month and the Minimum Rounds Per Year shall each be adjusted in
accordance with the Minimum Rounds Reduction Amount (and the Complimentary Golf
Rounds Fee shall be re-determined in connection therewith). Notwithstanding
anything to the contrary contained herein, if a Casualty Event occurs (and/or if
the determination of the amount of damage and/or the thirty (30) day period
referred to in the preceding sentence is continuing) at a time when User could
send a Renewal Notice (provided, for this purpose, User shall be permitted to
send a Renewal Notice under Section 2.3 not more than twenty-four (24) months
(rather than

 

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not more than eighteen (18) months) prior to the then current Stated Expiration
Date), if User has elected or elects to exercise the same at any time following
User’s receipt of such notice of termination from Owner, neither Owner nor User
may terminate this Agreement under this Section 11.2(a).

(b) If the cost to restore any individual Golf Course exceeds the amount of
proceeds received from the insurance required to be carried hereunder, then
(i) Owner shall not be obligated to restore such Golf Course, and (ii) Owner
shall, by written notice to User delivered to User within thirty (30) days of
the final determination of the amount of proceeds received from the insurance
required to be carried hereunder or otherwise maintained by Owner, elect to
either (A) restore such Golf Course to substantially the same condition as
existed immediately before such damage or otherwise in a manner reasonably
satisfactory to Owner (in which event this Agreement shall remain in full force
and effect) or (B) terminate this Agreement with respect to such Golf Course (in
which event (1) this Agreement shall terminate with respect to such Golf Course
and any insurance proceeds payable as a result of the damage or destruction
shall be payable in accordance with Section 11.2(c), and (2) commencing upon the
date of such termination, (x) the CES Use Fee shall be adjusted in accordance
with the CES Use Fee Reduction Amount and (y) the Minimum Rounds Per Month and
the Minimum Rounds Per Year shall each be adjusted in accordance with the
Minimum Rounds Reduction Amount (and the Complimentary Golf Rounds Fee shall be
re-determined in connection therewith)).

(c) In the event Owner is not required to, and does not elect to, repair and
restore any applicable Golf Course, all insurance proceeds shall be paid to and
retained by Owner free and clear of any claim.

11.3 No Abatement of Golf Course Use Payments. Except as expressly provided in
Article IX or this Article XI, this Agreement shall remain in full force and
effect and User’s obligation to pay each of the Golf Course Use Payments and all
Additional Charges required by this Agreement shall remain unabated during any
period following a Casualty Event. Notwithstanding anything to the contrary
contained herein, for the avoidance of doubt, under no scenario, including,
without limitation, the termination of this Agreement as a result of a Casualty
Event or otherwise, shall User be relieved of its obligation to pay the
Membership Fee before all of the Leases have terminated in accordance with their
respective terms.

11.4 Waiver. User waives any statutory rights of termination which may arise by
reason of any damage or destruction of any applicable Golf Course but such
waiver shall not affect any contractual rights granted to User under this
Agreement.

ARTICLE XII

EMINENT DOMAIN

12.1 Condemnation. Owner shall promptly give User written notice of the actual
or threatened Condemnation or any Condemnation proceeding affecting any Golf
Course of which Owner has knowledge and shall deliver to User copies of any and
all papers served in connection with the same.

 

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(a) Total Taking. If all of any individual Golf Course is subject to a permanent
Taking, then (i) this Agreement shall automatically terminate with respect to
such Golf Course as of the day before the date of such Taking, and
(ii) commencing upon the date of such termination, (A) the CES Use Fee shall be
adjusted in accordance with the CES Use Fee Reduction Amount and (B) the Minimum
Rounds Per Month and the Minimum Rounds Per Year shall each be adjusted in
accordance with the Minimum Rounds Reduction Amount (and the Complimentary Golf
Rounds Fee shall be re-determined in connection therewith).

(b) Partial Taking. If a portion (but not all) of any individual Golf Course is
subject to a permanent Taking (“Partial Taking”), then (i) this Agreement shall
remain in effect so long as such Golf Course is not thereby rendered Unsuitable
for Its Primary Intended Use, and (ii) none of the Golf Course Use Payments
shall be adjusted; provided, however, that if the applicable Golf Course is
rendered Unsuitable for Its Primary Intended Use, then (A) this Agreement shall
terminate with respect to such Golf Course as of the day before the date of such
Partial Taking, and (B) commencing upon the date of such termination, (1) the
CES Use Fee shall be adjusted in accordance with the CES Use Fee Reduction
Amount and (2) the Minimum Rounds Per Month and the Minimum Rounds Per Year
shall each be adjusted in accordance with the Minimum Rounds Reduction Amount
(and the Complimentary Golf Rounds Fee shall be re-determined in connection
therewith).

(c) Restoration. If there is a Partial Taking and this Agreement remains in full
force and effect, the Award shall be paid to Owner. In such event, (i) subject
to receiving such Award, Owner shall accomplish all necessary restoration in
accordance with the following sentence (whether or not the amount of the Award
received by Owner is sufficient), and (ii) none of the Golf Course Use Payments
shall be adjusted. Owner shall restore the affected Golf Course as nearly as
reasonably possible under the circumstances to a complete architectural unit of
the same general character and condition as existed immediately prior to the
applicable Partial Taking or otherwise reasonably satisfactory to Owner (but in
any case consistent with the Primary Intended Use).

12.2 Award Distribution. The Award resulting from any Taking or Condemnation
shall be paid to and retained by Owner free and clear of any claim.

12.3 Temporary Taking. The taking of any individual Golf Course, or any part
thereof, shall constitute a Taking by Condemnation only when the use and
occupancy by the taking authority has continued for longer than one hundred
eighty (180) consecutive days. During any shorter period, which shall be a
temporary taking, all the provisions of this Agreement shall remain in full
force and effect (except that (a) the CES Use Fee shall be adjusted in
accordance with the CES Use Fee Reduction Amount and (b) the Minimum Rounds Per
Month and the Minimum Rounds Per Year shall each be adjusted in accordance with
the Minimum Rounds Reduction Amount (and the Complimentary Golf Rounds Fee shall
be re-determined in connection therewith), in each case in proportion to the
duration of such temporary taking) and the Award shall be paid to Owner.

12.4 No Abatement of Membership Fee. Notwithstanding anything to the contrary
contained herein, for the avoidance of doubt, under no scenario, including,
without limitation, the termination of this Agreement as a result of a Taking,
Partial Taking or otherwise, shall User be relieved of its obligation to pay the
Membership Fee before all of the Leases have terminated in accordance with their
respective terms.

 

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ARTICLE XIII

DEFAULTS & REMEDIES

13.1 User Events of Default. Any one or more of the following shall constitute a
“User Event of Default”:

(a) User shall fail to pay any installment of any of the Golf Course Use
Payments when due and such failure is not cured within ten (10) days after
written notice from Owner of User’s failure to pay such installment when due
(and such notice of failure from Owner may be given any time after such
installment payment is one (1) day late);

(b) User shall fail to pay any Additional Charge within ten (10) days after
written notice from Owner of User’s failure to pay such Additional Charge when
due (and such notice of failure from Owner may be given any time after such
Additional Charge payment is one (1) day late);

(c) User shall:

(i) file a petition in bankruptcy or a petition to take advantage of any
insolvency law or statute under Federal law, specifically including Title 11,
United States Code, §§ 101-1532, or analogous state law;

(ii) make an assignment for the benefit of its creditors; or

(iii) consent to the appointment of a receiver of itself or of the whole or
substantially all of its property;

(d) User shall be adjudicated as bankrupt or a court of competent jurisdiction
shall enter an order or decree appointing, without the consent of User, a
receiver of User or of all or substantially all of User’s property, or approving
a petition filed against User seeking reorganization or arrangement of User
under Federal law, specifically including Title 11, United States Code,
§§ 101-1532, or analogous state law, and such judgment, order or decree shall
not be vacated or set aside or stayed within sixty (60) days from the date of
the entry thereof;

(e) entry of an order or decree liquidating or dissolving User, provided that
the same shall not constitute an User Event of Default if such order or decree
shall be vacated, set aside or stayed within ninety (90) days from the date of
the entry thereof;

(f) a transfer of User’s interest in this Agreement (including pursuant to a
Change of Control) shall have occurred without the consent of Owner to the
extent such consent is required under Article XVII or User is otherwise in
default of the provisions set forth in Section 17.1 below;

 

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(g) User shall fail to observe or perform any other term, covenant or condition
of this Agreement and such failure is not cured within thirty (30) days after
written notice thereof from Owner, provided, however, if such failure cannot
reasonably be cured within such thirty (30) day period and User shall have
commenced to cure such failure within such thirty (30) day period and thereafter
diligently proceeds to cure the same, then such thirty (30) day period shall be
extended for such time as is reasonably necessary for User in the exercise of
due diligence to cure such failure, provided that, with respect to any failure
to perform (i) that is still continuing on or after the first day of the sixth
(6th) Usage Year such cure period shall not extend beyond the later of such
first day of the sixth (6th) Usage Year or one hundred eighty (180) days in the
aggregate, and (ii) that is first arising on or after the first day of the sixth
(6th) Usage Year, such cure period shall not exceed one hundred eighty
(180) days in the aggregate; provided, further, however, that no User Event of
Default under this clause (g) or under clause (h) below shall be deemed to exist
under this Agreement during any time the curing thereof is prevented by an
Unavoidable Delay, provided that upon the cessation of the Unavoidable Delay,
User remedies the default within the time periods otherwise required hereunder;
and

(h) the occurrence of any Tenant Event of Default under the Non-CPLV Lease.

13.2 Owner Remedies. Upon the occurrence and during the continuance of an User
Event of Default, Owner may, subject to the terms of Section 13.4 below, do any
one or more of the following: (a) terminate this Agreement by giving User no
less than ten (10) days’ notice of such termination and the Term shall terminate
and all rights and obligations of User under this Agreement shall cease, subject
to any provisions that expressly survive the Expiration Date, (b) seek damages
as provided in Section 13.4 hereof, or (c) except to the extent expressly
otherwise provided under this Agreement, exercise any other right or remedy
hereunder, at law or in equity available to Owner as a result of any User Event
of Default. User shall pay as Additional Charges all costs and expenses incurred
by or on behalf of Owner, including reasonable and documented attorneys’ fees
and expenses, as a result of any User Event of Default hereunder.

13.3 Owner Events of Default; User Remedies.

(a) An “Owner Event of Default” shall have occurred if Owner shall fail to
observe or perform any term, covenant or condition of this Agreement, which
failure materially and adversely affects User, and such failure is not cured
within thirty (30) days after written notice thereof from User, provided,
however, if such failure cannot reasonably be cured within such thirty (30) day
period and Owner shall have commenced to cure such failure within such thirty
(30) day period and thereafter diligently proceeds to cure the same, then such
thirty (30) day period shall be extended for such time as is reasonably
necessary for Owner in the exercise of due diligence to cure such failure,
provided that, with respect to any failure to perform (i) that is still
continuing on or after the first day of the sixth (6th) Usage Year such cure
period shall not extend beyond the later of such first day of the sixth
(6th) Usage Year or one hundred eighty (180) days in the aggregate, and
(ii) that is first arising on or after the first day of the sixth (6th) Usage
Year, such cure period shall not exceed one hundred eighty (180) days in the
aggregate; provided, further, however, that no Owner Event of Default under this
clause (a) shall be deemed to exist under this Agreement during any time the
curing thereof is prevented by an Unavoidable Delay, provided that upon the
cessation of the Unavoidable Delay, Owner remedies the default within the time
periods otherwise required hereunder.

 

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(b) Upon the occurrence and during the continuance of an Owner Event of Default,
User may, except to the extent expressly otherwise provided in this Agreement,
exercise any right or remedy hereunder, at law or in equity available to User as
a result of any Owner Event of Default, including, without limitation, seeking
the remedy of specific performance.

13.4 Damages. If Owner elects to terminate this Agreement in writing upon an
User Event of Default during the Term, User shall forthwith (x) pay to Owner all
Golf Course Use Payments due and payable under this Agreement to and including
the date of such termination (together with interest thereon at the Overdue Rate
from the date the applicable amount was due), and (y) pay on demand all damages
to which Owner shall be entitled at law or in equity, which, for the avoidance
of doubt, shall include the aggregate amounts of the Membership Fee and the CES
Use Fee that would have been due and payable under this Agreement throughout the
Term (including all Renewal Terms) but for such termination; provided, however,
Owner’s damages with regard to unpaid Golf Course Use Payments from and after
the date of termination shall equal, as liquidated and agreed current damages in
respect thereof, the sum of: (A) the worth at the time of award of the amount by
which the unpaid Golf Course Use Payments (excluding the portion of the
Complimentary Golf Rounds Fee attributable to the aggregate of the Annual Other
Sponsored Rounds Fees for all of the Golf Courses) that (if this Agreement had
not been terminated) would have been payable hereunder after termination until
the time of award exceeds the amount of such Golf Course Use Payments (excluding
the portion of the Complimentary Golf Rounds Fee attributable to the aggregate
of the Annual Other Sponsored Rounds Fees for all of the Golf Courses) loss that
User proves could have been reasonably avoided; plus (B) (x) the Golf Course Use
Payments (excluding the portion of the Complimentary Golf Rounds Fee
attributable to the aggregate of the Annual Other Sponsored Rounds Fees for all
of the Golf Courses) which (if this Agreement had not been terminated) would
have been payable hereunder from the time of award until the then Stated
Expiration Date, discounted to present value by applying a discount rate equal
to the discount rate of the Federal Reserve Bank of New York at the time of
award, plus one percent (1%), less (y) the Golf Course Use Payments (excluding
the portion of the Complimentary Golf Rounds Fee attributable to the aggregate
of the Annual Other Sponsored Rounds Fees for all of the Golf Courses) loss from
the time of the award until the then Stated Expiration Date that User proves
could be reasonably avoided, discounted to present value by applying a discount
rate equal to the discount rate of the Federal Reserve Bank of New York at the
time of award, plus one percent (1%) (it being understood the foregoing
calculation of damages for unpaid Golf Course Use Payments applies only to the
amount of unpaid Golf Course Use Payments damages owed to Owner pursuant to
User’s obligation to pay Golf Course Use Payments hereunder and does not
prohibit or otherwise shall not limit Owner from seeking damages for any
indemnification or any other obligations of User hereunder, with all such rights
of Owner reserved). As used in clause (A), the “worth at the time of award”
shall be computed by allowing interest at the Overdue Rate from the date the
applicable amount was due.

13.5 Application of Funds. Any payments received by Owner under any of the
provisions of this Agreement during the existence or continuance of any User
Event of Default which are made to Owner rather than User due to the existence
of an User Event of Default shall be applied to User’s obligations in the order
which Owner may reasonably determine or as may be prescribed by applicable Legal
Requirements.

 

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13.6 Owner’s Right to Cure User’s Default. If User shall fail to make any
payment or to perform any act required to be made or performed hereunder when
due, in all cases, after the expiration of any cure period provided for herein,
Owner, without waiving or releasing any obligation or default, may, but shall be
under no obligation to, make such payment or perform such act for the account
and at the expense of User. All sums so paid by Owner and all costs and
expenses, including reasonable attorneys’ fees and expenses, so incurred,
together with interest thereon at the Overdue Rate from the date on which such
sums or expenses are paid or incurred by Owner, shall be paid by User to Owner
on demand as an Additional Charge.

13.7 Reduction of Minimum Rounds Per Month and Minimum Rounds Per Year.
Notwithstanding anything in this Agreement to the contrary, if Owner breaches
its obligations under Schedule 1 to Exhibit B attached hereto to reserve (i.e.,
set aside) tee times for User’s (or User’s Affiliates’) guests’ use, then the
applicable Minimum Rounds Per Month and the applicable Minimum Rounds Per Year
shall each be reduced by the applicable number of tee times which Owner fails to
reserve (i.e., set aside) for User’s (or User’s Affiliates’) guests’ use in
accordance with Schedule 1 to Exhibit B attached hereto (and the Complimentary
Golf Rounds Fee shall be re-determined in connection therewith).

13.8 Miscellaneous.

(a) Suit or suits for the recovery of damages, or for a sum equal to any
installment or installments of Golf Course Use Payments payable hereunder, or
for any other sums payable by User to Owner pursuant to this Agreement, may be
brought by Owner from time to time at Owner’s election, and nothing herein
contained shall be deemed to require Owner to await the date whereon this
Agreement and the Term would have expired by limitation had there been no User
Event of Default or termination.

(b) No failure by either Party to insist upon the strict performance of any
agreement, term, covenant or condition of this Agreement or to exercise any
right or remedy consequent upon a breach thereof, and no acceptance by Owner of
full or partial payment of any Golf Course Use Payments during the continuance
of any such breach, shall constitute a waiver of any such breach or of such
agreement, term, covenant or condition. No agreement, term, covenant or
condition of this Agreement to be performed or complied with by either Party,
and no breach thereof, shall be or be deemed to be waived, altered or modified
except by a written instrument executed by the Parties. No waiver of any breach
shall affect or alter this Agreement, but each and every agreement, term,
covenant and condition of this Agreement shall continue in full force and effect
with respect to any other then existing or subsequent breach thereof. In the
event Owner claims in good faith that User has breached any of the agreements,
terms, covenants or conditions contained in this Agreement, Owner shall be
entitled to seek to enjoin such breach or threatened breach and shall have the
right to invoke any rights and remedies allowed at law or in equity or by
statute or otherwise as though summary proceedings or other remedies were not
provided for in this Agreement.

 

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(c) Except to the extent otherwise expressly provided in this Agreement, each
right and remedy of a Party provided for in this Agreement shall be cumulative
and shall be in addition to every other right or remedy provided for in this
Agreement or now or hereafter existing at law or in equity (subject to the
limitations on the calculation of unpaid Golf Course Use Payments set forth in
Section 13.4 above).

(d) Nothing contained in this Article XIII or otherwise shall vitiate or limit
User’s or Owner’s obligation to pay the other Party’s attorneys’ fees as and to
the extent provided in Article XXV hereof, or any indemnification obligations
under any express indemnity made by User of Owner or of any Owner Indemnified
Parties or by Owner of User or of any User Indemnified Parties as contained in
this Agreement.

ARTICLE XIV

LICENSING EVENTS

14.1 Owner Licensing Event. If there shall occur an Owner Licensing Event and
any aspect of such Owner Licensing Event is attributable to a member of the
Owner Subject Group, then User shall notify Owner as promptly as practicable
after becoming aware of such Owner Licensing Event (but in no event later than
twenty (20) days after becoming aware of such Owner Licensing Event). In such
event, Owner shall, and shall use commercially reasonable efforts to cause the
other members of the Owner Subject Group to, use commercially reasonable efforts
to assist User and its Affiliates in resolving such Owner Licensing Event within
the time period required by the applicable Gaming Authorities by submitting to
investigation by the relevant Gaming Authorities and cooperating with any
reasonable requests made by such Gaming Authorities (including filing requested
forms and delivering information to the Gaming Authorities). If, despite these
efforts, such Owner Licensing Event cannot be resolved to the satisfaction of
the applicable Gaming Authorities within the time period required by such Gaming
Authorities, User shall have the right, at its election in its sole discretion,
either to (a) terminate this Agreement or (b) cause this Agreement to
temporarily cease to be in force or effect, until such time, if any, as the
Owner Licensing Event is resolved to the satisfaction of the applicable Gaming
Authorities and User in its sole discretion, upon no less than ninety (90) days’
written notice thereof to Owner following an Owner Licensing Event which is not
cured within the period required by the applicable Gaming Authorities (or such
lesser time as required by any applicable Gaming Authority).

14.2 User Licensing Event. If there shall occur a User Licensing Event and any
aspect of such User Licensing Event is attributable to a member of the User
Subject Group, then Owner shall notify User as promptly as practicable after
becoming aware of such User Licensing Event (but in no event later than twenty
(20) days after becoming aware of such User Licensing Event). In such event,
User shall and shall use commercially reasonable efforts to cause the other
members of the User Subject Group to use commercially reasonable efforts to
assist Owner and its Affiliates in resolving such User Licensing Event within
the time period required by the applicable Gaming Authorities by submitting to
investigation by the relevant Gaming Authorities and cooperating with any
reasonable requests made by such Gaming Authorities (including filing requested
forms and delivering information to the Gaming Authorities). If, despite these
efforts, such User Licensing Event cannot be resolved to the satisfaction of the
applicable Gaming Authorities within the time period required by such Gaming
Authorities, Owner shall have the right, at its election in its sole discretion,
either to (a) terminate this Agreement or (b) cause this

 

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Agreement to temporarily cease to be in force or effect, until such time, if
any, as the User Licensing Event is resolved to the satisfaction of the
applicable Gaming Authorities and Owner in its sole discretion, upon no less
than ninety (90) days’ written notice thereof to User following a User Licensing
Event which is not cured within the period required by the applicable Gaming
Authorities (or such lesser time as required by any applicable Gaming
Authority).

ARTICLE XV

INDEMNIFICATION

In addition to the other indemnities contained herein, and notwithstanding the
existence of any insurance carried by or for the benefit of Owner or User, and
without regard to the policy limits of any such insurance, (a) User shall
protect, indemnify, save harmless and defend Owner and its principals, partners,
officers, members, directors, shareholders, employees, managers, agents and
servants (collectively, the “Owner Indemnified Parties”; each individually, an
“Owner Indemnified Party”), from and against all liabilities, obligations,
claims, damages, penalties, causes of action, suits, criminal or civil actions
or similar proceedings, costs and expenses, including reasonable documented
attorneys’, consultants’ and experts’ fees and expenses, imposed upon or
incurred by or asserted against any Owner Indemnified Party (excluding any
indirect, special, punitive or consequential damages as provided in
Section 27.3) by reason of any gross negligence or willful misconduct of any
User Indemnified Party (as hereinafter defined); and (b) Owner shall protect,
indemnify, save harmless and defend User and its principals, partners, officers,
members, directors, shareholders, employees, managers, agents and servants
(collectively, the “User Indemnified Parties”; each individually, a “User
Indemnified Party”) from and against all liabilities, obligations, claims,
damages, penalties, causes of action, suits, criminal or civil actions or
similar proceedings, costs and expenses, including reasonable documented
attorneys’, consultants’ and experts’ fees and expenses, imposed upon or
incurred by or asserted against any User Indemnified Party (excluding any
indirect, special, punitive or consequential damages as provided in
Section 27.3) by reason of any gross negligence or willful misconduct of any
Owner Indemnified Party. Any amounts which become payable by Owner or User under
this Article XV shall be paid within ten (10) days after liability therefor is
determined by a final non appealable judgment or settlement or other agreement
of the Parties, and if not timely paid shall bear interest at the Overdue Rate
from the date of such determination to the date of payment. Owner, with its
counsel and at its sole cost and expense, shall contest, resist and defend any
such claim, action or proceeding asserted or instituted against the User
Indemnified Parties; and User, with its counsel and at its sole cost and
expense, shall contest, resist and defend any such claim, action or proceeding
asserted or instituted against the Owner Indemnified Parties. For purposes of
this Article XV, any acts or omissions of Owner, or by employees, agents,
assignees, contractors, subcontractors or others acting for or on behalf of
Owner, shall be strictly attributable to Owner; and any acts or omissions of
User, or by employees, agents, assignees, contractors, subcontractors or others
acting for or on behalf of User, shall be strictly attributable to User.

 

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ARTICLE XVI

TRANSFERS BY OWNER

16.1 Transfers Generally. Owner may sell, assign, transfer or convey, without
User’s consent, all of the Golf Courses, any individual Golf Course or any
portion of any Golf Course, or any interest therein. If the subject transaction
involves a sale, assignment, transfer or conveyance of all of the Golf Courses,
then this Agreement shall be assigned to the applicable transferee such that
such transferee shall become successor Owner as if an original party to this
Agreement. If the subject transaction involves a sale, assignment, transfer or
conveyance of any individual Golf Course (or several Golf Courses but not all of
the Golf Courses), then (a) subject to Section 16.2 below, this Agreement shall
remain in full force and effect with respect to the Golf Course(s) not
transferred to the applicable transferee, and (b) a Severance Agreement with
such transferee shall be entered into with respect to the Golf Course(s)
transferred to the applicable transferee as described in Section 16.2 below. If
the subject transaction involves a sale, assignment, transfer or conveyance of a
portion (but not all) of any individual Golf Course, then (i) this Agreement
shall remain in effect so long as such Golf Course is not thereby rendered
Unsuitable for Its Primary Intended Use, and (ii) none of the Golf Course Use
Payments shall be adjusted; provided, however, that if the applicable Golf
Course is rendered Unsuitable for Its Primary Intended Use, then (A) this
Agreement shall terminate with respect to such Golf Course as of the closing of
such transaction, and (B) commencing upon the date of such termination, (1) the
CES Use Fee shall be adjusted in accordance with the CES Use Fee Reduction
Amount and (2) the Minimum Rounds Per Month and the Minimum Rounds Per Year
shall each be adjusted in accordance with the Minimum Rounds Reduction Amount
(and the Complimentary Golf Rounds Fee shall be re-determined in connection
therewith). If Owner (including any successor Owner) shall convey all of the
Golf Courses, any individual Golf Course or any portion of any Golf Course, then
Owner shall be released from all future liabilities and obligations of Owner
under this Agreement with respect to the Golf Course(s) or the applicable
portion of a Golf Course (provided such conveyance of such portion of the Golf
Course does not affect the Primary Intended Use of the remaining portion of such
Golf Course as an eighteen (18) hole golf course) transferred to the applicable
transferee upon the later of (x) such conveyance and (y) the applicable
transferee’s (A) express assumption of all liabilities and obligations of Owner
under this Agreement relating to such transferred Golf Course(s) arising after
such conveyance and (B) in the event at least one (1), but less than all, of the
Golf Courses are so conveyed, execution of a Severance Agreement, and all
liabilities and obligations of Owner hereunder relating to such transferred Golf
Course(s) shall thereafter be binding upon such transferee. Notwithstanding
anything to the contrary herein, Owner shall not sell, assign, transfer or
convey any of the Golf Courses, or assign this Agreement, to (1) a Tenant
Prohibited Person (as defined in the MLSA), (2) a Manager Prohibited Person (as
defined in the MLSA), or (3) any Person that is associated with a Person who has
been found “unsuitable”, denied a Gaming License or otherwise precluded from
participation in the gaming industry by any Gaming Authority, where such
association may adversely affect any of User’s or its Affiliates’ Gaming
Licenses or User’s or its Affiliates’ then-current standing with any Gaming
Authority. Any assignment or transfer under this Article XVI shall be subject to
all applicable Legal Requirements, and no such assignment or transfer shall be
effective until any applicable approvals, if applicable, are obtained.

 

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16.2 Severance Agreements. In the event Owner desires to sell or otherwise
transfer at least one (1), but less than all, of the Golf Courses (in whole but
not in part) to a third party or to an affiliate of Owner, then the Parties
shall enter into a Severance Agreement with respect to such Golf Course, in
accordance with the following provisions:

(a) Owner shall give User not less than fifteen (15) days’ advance written
notice of a Severance Agreement, and User shall thereafter, within said fifteen
(15)-day period (or such longer period of time as Owner may require; it being
understood that Owner may delay or cancel a Severance Agreement in the event
that the underlying sale or transfer of a Golf Course is delayed or cancelled
for any reason), execute, acknowledge and deliver a Severance Agreement to the
new owner of the applicable Golf Course for the remaining Term and on
substantially the same terms and conditions as this Agreement (except for
appropriate adjustments (including to Exhibits and Schedules), including such
adjustments as are described in this Article XVI), and in any case no less
favorable to User than the terms and conditions of this Agreement.

(b) In the event a Severance Agreement is entered into, Owner may, before the
Severance Agreement is executed, elect, in its sole discretion, for the
Membership Fee that was in effect under this Agreement immediately prior to the
effective date of such Severance Agreement to remain in full force and effect
under this Agreement (a “Membership Fee Retainage Election”). If Owner timely
makes a Membership Fee Retainage Election (which election may be included in the
notice provided pursuant to Section 16.2(a) above), then the Severance Agreement
shall provide that no amount is payable under such Severance Agreement in
respect of any Membership Fee and the Membership Fee payable under this
Agreement shall not be reduced. If Owner does not timely make a Membership Fee
Retainage Election, then (i) the Membership Fee payable under the Severance
Agreement at the time of the commencement of such Severance Agreement shall be
equal to the amount of the Membership Fee Reduction Amount for the applicable
Golf Course to be subject to such Severance Agreement, and (ii) correspondingly,
upon the effective date of the Severance Agreement, the Membership Fee payable
hereunder shall be reduced by such Membership Fee Reduction Amount.

(c) The CES Use Fee payable under the Severance Agreement at the time of the
commencement of such Severance Agreement shall be equal to the amount of the CES
Use Fee Reduction Amount for the applicable Golf Course to be subject to such
Severance Agreement. Correspondingly, upon the effective date of the Severance
Agreement, the CES Use Fee payable hereunder shall be reduced by such CES Use
Fee Reduction Amount.

(d) The Minimum Rounds Per Month and Minimum Rounds Per Year under the Severance
Agreement at the time of the commencement of such Severance Agreement shall be
determined in accordance with the Minimum Rounds Reduction Amount for the
applicable Golf Course to be subject to such Severance Agreement (and the
Complimentary Golf Rounds Fee payable under such Severance Agreement shall be
determined in connection therewith). Correspondingly, upon the effective date of
the Severance Agreement, the Minimum Rounds Per Month and Minimum Rounds Per
Year hereunder shall each be adjusted in accordance with such Minimum Rounds
Reduction Amount (and the Complimentary Golf Rounds Fee payable hereunder shall
be re-determined in connection therewith).

(e) This Agreement shall automatically terminate with respect to the applicable
Golf Course that is subject to such Severance Agreement as of the effective date
of such Severance Agreement.

 

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(f) User shall take such actions and execute and deliver such documents,
including, without limitation, amended Memorandum(s) of Agreement and, if
requested by Owner, an amendment to this Agreement, as are reasonably necessary
and appropriate to effectuate fully the provisions and intent of this Article
XVI, and as Owner may reasonably request to evidence such removal of the
applicable Golf Course from this Agreement.

(g) All reasonable, documented out-of-pocket costs and expenses actually
incurred relating to a Severance Agreement (including reasonable attorneys’ fees
and other reasonable, documented out-of-pocket costs incurred by User for
outside counsel, if any) shall (i) be borne by Owner and not User and (ii) be
reimbursed to User by Owner within ten (10) days after Owner’s receipt of
written demand therefor from User.

(h) At the option of such new owner, a Severance Agreement may provide that the
new owner of the applicable Golf Course shall have the right to terminate such
Severance Agreement on or after the date that is five (5) years after the
commencement of such Severance Agreement (the date on which such Severance
Agreement terminates pursuant to such new owner’s exercise of such termination
right, the “Severance Agreement Termination Date”), in which event such
Severance Agreement and the obligations of User to pay the Golf Course Use
Payments payable thereunder shall continue through (and including) the Severance
Agreement Termination Date.

16.3 No Release of Owner’s Obligations; Exception. The liability of Owner and
any immediate and remote successor in interest of Owner (by assignment or
otherwise), and the due performance of the obligations of this Agreement on
Owner’s part to be performed or observed, shall not in any way be discharged,
released or impaired by any (i) stipulation which extends the time within which
an obligation under this Agreement is to be performed, (ii) waiver of the
performance of an obligation required under this Agreement that is not entered
into by User in a writing executed by User and expressly stated to be for the
benefit of Owner or such successor, or (iii) failure to enforce any of the
obligations set forth in this Agreement, provided that Owner shall not be
responsible for any additional obligations or liability arising as the result of
any modification or amendment of this Agreement by User and any assignee of
Owner that is not an Affiliate of Owner.

ARTICLE XVII

TRANSFERS BY USER

17.1 Assignment. Other than as expressly provided herein (including the
permitted assignments described in this Article XVII), User shall not, without
Owner’s prior written consent (which, except as specifically set forth herein,
may be withheld in Owner’s sole and absolute discretion), voluntarily or by
operation of law assign (which term includes any transfer, sale, encumbering,
pledge or other transfer or hypothecation), directly or indirectly, in whole or
in part, this Agreement. Any Change of Control of User (or, subject to
Section 17.2 below, any transfer of direct or indirect interests in User that
results in a Change of Control) shall constitute an assignment of User’s
interest in this Agreement within the meaning of this Article XVII and the
provisions requiring consent contained herein shall apply thereto. Any
assignment or transfer under this Article XVII shall be subject to all
applicable Legal Requirements, and no such assignment or transfer shall be
effective until any applicable approvals, if applicable, are obtained.

 

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17.2 Permitted Assignments and Transfers. Notwithstanding the foregoing or
anything to the contrary contained herein, (i) the assignments, transfers and
other actions or transactions (excluding Subleases (as such term is defined in
the Non-CPLV Lease)) permitted under Section 22.2 of the Non-CPLV Lease shall be
permitted hereunder, and (ii) this Agreement may be assigned or transferred by
User to the Person(s) to whom the Non-CPLV Tenant assigns or transfers its
interest in the Non-CPLV Lease in accordance with the terms thereof. Further,
any Permitted User Lender shall have the same right to receive any notice of a
default by User under this Agreement or termination of this Agreement and the
same right to cure such default or act or omission which gave rise to such
default as such Permitted User Lender would have with respect to a default by
the Non-CPLV Tenant under the Non-CPLV Lease or termination of the Non-CPLV
Lease as set forth in Article XVII of the Non-CPLV Lease, as if such provisions
were set forth in this Agreement mutatis mutandis.

17.3 Costs. User shall reimburse Owner for Owner’s reasonable out-of-pocket
costs and expenses actually incurred in conjunction with the processing and
documentation of any assignment or transfer of this Agreement by User, including
reasonable documented attorneys’, architects’, engineers’ or other consultants’
fees whether or not such assignment or transfer is actually consummated.

17.4 No Release of User’s Obligations; Exception. No assignment shall relieve
User of its obligation to pay each of the Golf Course Use Payments and to
perform all of the other obligations to be performed by User hereunder. The
liability of User and any immediate and remote successor in interest of User (by
assignment or otherwise), and the due performance of the obligations of this
Agreement on User’s part to be performed or observed, shall not in any way be
discharged, released or impaired by any (i) stipulation which extends the time
within which an obligation under this Agreement is to be performed, (ii) waiver
of the performance of an obligation required under this Agreement that is not
entered into by Owner in a writing executed by Owner and expressly stated to be
for the benefit of User or such successor, or (iii) failure to enforce any of
the obligations set forth in this Agreement, provided that User shall not be
responsible for any additional obligations or liability arising as the result of
any modification or amendment of this Agreement by Owner and any assignee of
User that is not an Affiliate of User.

17.5 Merger of CEOC. The Parties acknowledge that, immediately following the
execution of this Agreement, Caesars Entertainment Operating Company, Inc., a
Delaware corporation, will merge into CEOC, LLC, a Delaware limited liability
company. Notwithstanding anything herein to the contrary, Owner consents to such
merger.

ARTICLE XVIII

ESTOPPEL CERTIFICATES

Each of Owner and User shall, at any time and from time to time upon receipt of
not less than ten (10) Business Days’ prior written request from the other
Party, furnish a certificate (an “Estoppel Certificate”) certifying (i) that
this Agreement is unmodified and in full force and

 

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effect, or that this Agreement is in full force and effect and, if applicable,
setting forth any modifications; (ii) each of the Golf Course Use Payments and
Additional Charges payable hereunder and the dates to which each of the Golf
Course Use Payments and Additional Charges payable have been paid; (iii) that
the address for notices to be sent to the Party furnishing such Estoppel
Certificate is as set forth in this Agreement (or, if such address for notices
has changed, the correct address for notices to such party); (iv) whether or
not, to its actual knowledge, such Party or the other Party is in default in the
performance of any covenant, agreement or condition contained in this Agreement
(together with back-up calculation and information reasonably necessary to
support such determination) and, if so, specifying each such default of which
such Party may have knowledge; and (v) responses to such other questions or
statements of fact as such other Party may reasonably request. Any such Estoppel
Certificate may be relied upon by the receiving Party and any current or
prospective Fee Mortgagee (and their successors and assigns) or purchaser of the
Golf Courses, as applicable.

ARTICLE XIX

NO WAIVER

No delay, omission or failure by Owner to insist upon the strict performance of
any term hereof or to exercise any right, power or remedy hereunder and no
acceptance of full or partial payment of any Golf Course Use Payments during the
continuance of any default or User Event of Default shall impair any such right
or constitute a waiver of any such breach or of any such term. No waiver of any
breach shall affect or alter this Agreement, which shall continue in full force
and effect with respect to any other then existing or subsequent breach.

ARTICLE XX

REMEDIES CUMULATIVE

To the extent permitted by law, each legal, equitable or contractual right,
power and remedy of Owner now or hereafter provided either in this Agreement or
by statute or otherwise shall be cumulative and concurrent and shall be in
addition to every other right, power and remedy and the exercise or beginning of
the exercise by Owner of any one or more of such rights, powers and remedies
shall not preclude the simultaneous or subsequent exercise by Owner of any or
all of such other rights, powers and remedies.

ARTICLE XXI

ACCEPTANCE OF SURRENDER

No surrender to Owner of this Agreement or of the Golf Courses or any part
thereof, or of any interest therein, shall be valid or effective unless agreed
to and accepted in writing by Owner, and no act by Owner or any representative
or agent of Owner, other than such a written acceptance by Owner, shall
constitute an acceptance of any such surrender.

 

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ARTICLE XXII

OWNER FINANCING

Owner may from time to time, directly or indirectly, create or otherwise cause
to exist any Fee Mortgage upon the Golf Courses or any portion thereof or
interest therein (including direct or indirect interests in Owner which are
pledged pursuant to a mezzanine loan or other financing arrangement). This
Agreement is and at all times shall be subject and subordinate to any Existing
Fee Mortgage and any other Fee Mortgage which may hereafter affect the Golf
Courses or any portion thereof or interest therein and in each case to all
renewals, modifications, consolidations, replacements, restatements and
extensions thereof or any parts or portions thereof. If, in connection with
obtaining any Fee Mortgage or entering into any agreement relating thereto,
Owner shall request in writing (a) reasonable cooperation from User or
(b) reasonable amendments or modifications to this Agreement, in each case
required to comply with any reasonable request made by Fee Mortgagee, User shall
reasonably cooperate with such request, so long as (i) no default in any
material respect by Owner beyond applicable cure periods is continuing, (ii) all
reasonable documented out-of-pocket costs and expenses incurred by User in
connection with such cooperation, including, but not limited to, its reasonable
documented attorneys’ fees, shall be paid by Owner and (iii) any requested
action, including any amendments or modifications of this Agreement, shall not
(A) increase User’s monetary obligations under this Agreement by more than a de
minimis extent, or increase User’s non-monetary obligations under this Agreement
in any material respect, or decrease Owner’s obligations under this Agreement in
any material respect, (B) diminish User’s rights under this Agreement in any
material respect, (C) adversely impact the value of the Golf Courses by more
than a de minimis extent or otherwise have a more than de minimis adverse effect
on the Golf Courses, User or Owner, or (D) result in a default under any
Permitted User Security Instrument.

ARTICLE XXIII

INTENTIONALLY OMITTED

ARTICLE XXIV

NOTICES

Any notice, request, demand, consent, approval or other communication required
or permitted to be given by either Party hereunder to the other Party shall be
in writing and shall be sent by registered or certified mail, postage prepaid
and return receipt requested, by hand delivery or express courier service, by
email transmission or by an overnight express service to the following address:

To Owner:

c/o VICI Golf LLC

8329 West Sunset Road, Suite 210

Las Vegas, NV 89113

Attention: General Counsel

Email: corplaw@viciproperties.com

To User:

 

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Caesars Enterprise Services, LLC and CEOC, LLC

One Caesars Palace Drive

Las Vegas, NV 89109

Attention: General Counsel

Email: corplaw@caesars.com

or to such other address as either Party may hereafter designate. Notice shall
be deemed to have been given on the date of delivery if such delivery is made on
a Business Day, or if not, on the first Business Day after delivery. If delivery
is refused, Notice shall be deemed to have been given on the date delivery was
first attempted. Notice sent by email shall be deemed given only upon an
independent, non-automated confirmation from the recipient acknowledging
receipt.

ARTICLE XXV

ATTORNEYS’ FEES

If Owner or User brings an action or other proceeding against the other to
enforce or interpret any of the terms, covenants or conditions hereof or any
instrument executed pursuant to this Agreement, or by reason of any breach or
default hereunder or thereunder, the Party substantially prevailing in any such
action or proceeding and any appeal thereupon shall be paid all of its costs and
reasonable documented outside attorneys’ fees incurred therein. In addition to
the foregoing and other provisions of this Agreement that specifically require
User to reimburse, pay or indemnify against Owner’s attorneys’ fees, User shall
pay, as Additional Charges, all of Owner’s reasonable documented outside
attorneys’ fees incurred in connection with the enforcement of this Agreement
(except to the extent provided above), including reasonable documented
attorneys’ fees incurred in connection with the review, negotiation or
documentation of any assignment or any consent requested in connection with such
enforcement, and the collection of any past due Golf Course Use Payments.

ARTICLE XXVI

ANTI-TERRORISM REPRESENTATIONS

Each Party hereby represents and warrants to the other Party that neither such
representing Party nor, to its knowledge, any persons or entities holding any
Controlling legal or beneficial interest whatsoever in it are (i) the target of
any sanctions program that is established by Executive Order of the President or
published by the Office of Foreign Assets Control, U.S. Department of the
Treasury (“OFAC”); (ii) designated by the President or OFAC pursuant to the
Trading with the Enemy Act, 50 U.S.C. App. § 5, the International Emergency
Economic Powers Act, 50 U.S.C. §§ 1701-06, the Patriot Act, Public Law 107-56,
Executive Order 13224 (September 23, 2001) or any Executive Order of the
President issued pursuant to such statutes; or (iii) named on the following list
that is published by OFAC: “List of Specially Designated Nationals and Blocked
Persons” (collectively, “Prohibited Persons”). Each Party hereby represents and
warrants to the other Party that no funds tendered to such other Party by such
tendering Party under the terms of this Agreement are or will be directly or
indirectly derived from activities that may contravene U.S. federal, state or
international laws and regulations, including anti-money laundering laws.
Neither Party will during the Term knowingly engage in any transactions or
dealings, or knowingly be otherwise associated with, any Prohibited Persons in
connection with the Golf Courses.

 

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ARTICLE XXVII

MISCELLANEOUS

27.1 Survival. Anything contained in this Agreement to the contrary
notwithstanding, all claims against, and liabilities, obligations and
indemnities of User or Owner arising or in respect of any period prior to the
Expiration Date shall survive the Expiration Date.

27.2 Severability. Subject to Section 27.17, if any term or provision of this
Agreement or any application thereof shall be held invalid or unenforceable, the
remainder of this Agreement and any other application of such term or provision
shall not be affected thereby.

27.3 Non-Recourse. User specifically agrees to look solely to the Golf Courses
for recovery of any judgment from Owner (and Owner’s liability hereunder shall
be limited solely to its interest in the Golf Courses, and no recourse under or
in respect of this Agreement shall be had against any other assets of Owner
whatsoever). The provision contained in the foregoing sentence is not intended
to, and shall not, limit any right that User might otherwise have to obtain
injunctive relief against Owner, or any action not involving the personal
liability of Owner. In no event shall either Party ever be liable to the other
Party for any indirect, consequential, lost profits, punitive, exemplary,
statutory or treble damages suffered from whatever cause (other than, as to all
such forms of damages, (i) if Owner has terminated this Agreement, any damages
as provided under Section 13.4 hereof, (ii) if Owner has not terminated this
Agreement, any damages as provided for herein, and (iii) a claim (including an
indemnity claim) for recovery of any such damages that the claiming party is
required by a court of competent jurisdiction or the expert to pay to a third
party (other than to the extent resulting from the claiming party’s gross
negligence, willful misconduct or default hereunder), and the Parties
acknowledge and agree that the rights and remedies in this Agreement, and all
other rights and remedies at law and in equity, will be adequate in all
circumstances for any claims the parties might have with respect to damages. It
is specifically agreed that no constituent member, partner, owner, director,
officer or employee of a Party shall ever be personally liable for any judgment
(in respect of obligations under or in connection with this Agreement) against,
or for the payment of any monetary obligation under or in respect of this
Agreement, such Party, to the other Party.

27.4 Successors and Assigns. This Agreement shall be binding upon Owner and its
permitted successors and assigns and, subject to the provisions of Article XVII,
upon User and its successors and assigns.

27.5 Arbitration. In the event of a dispute with respect to this Agreement, or
in any case when this Agreement expressly provides for the settlement or
determination of a dispute or question by an Expert pursuant to this
Section 27.5 (in any such case, a “Section 27.5 Dispute”) such dispute shall be
determined in accordance with an arbitration proceeding as set forth in this
Section 27.5.

 

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(a) Any Section 27.5 Dispute shall be determined by an arbitration panel
comprised of three members, each of whom shall be an Expert (the “Arbitration
Panel”). No more than one panel member may be with the same firm and no panel
member may have an economic interest in the outcome of the arbitration.

(b) The Arbitration Panel shall be selected as set forth in this
Section 27.5(b). If a Section 27.5 Dispute arises and if Owner and User are not
able to resolve such dispute after at least fifteen (15) days of good faith
negotiations, then either Party shall each have the right to submit the dispute
to the Arbitration Panel, upon written notice to the other Party (the
“Arbitration Notice”). The Arbitration Notice shall identify one member of the
Arbitration Panel who meets the criteria of the above paragraph. Within five
(5) Business Days after the receipt of the Arbitration Notice, the Party
receiving such Arbitration Notice shall respond in writing identifying one
member of the Arbitration Panel who meets the criteria of the above paragraph.
Such notices shall include the name, address and other pertinent contact
information, and qualifications of its member of the Arbitration Panel. If a
Party fails to timely select its respective panel member, the other Party may
notify such Party in writing of such failure, and if such Party fails to select
its respective panel member within three (3) Business Days after receipt of such
notice, then such other Party may select and identify to such Party such panel
member on such Party’s behalf. The third member of the Arbitration Panel will be
selected by the two (2) members of the Arbitration Panel who were selected by
Owner and User; provided, that if, within five (5) Business Days after they are
identified, they fail to select a third member, or if they are unable to agree
on such selection, Owner and User shall cause the third member of the
Arbitration Panel to be appointed by the managing officer of the American
Arbitration Association.

(c) Within ten (10) Business Days after the selection of the Arbitration Panel,
Owner and User each shall submit to the Arbitration Panel a written statement
identifying its summary of the issues. Owner and User may also request an
evidentiary hearing on the merits in addition to the submission of written
statements. The Arbitration Panel shall make its decision within twenty
(20) days after the later of (i) the submission of such written statements, and
(ii) the conclusion of any evidentiary hearing on the merits. The Arbitration
Panel shall reach its decision by majority vote and shall communicate its
decision by written notice to Owner and User.

(d) The decision by the Arbitration Panel shall be final, binding and conclusive
and shall be non-appealable and enforceable in any court having jurisdiction.
All hearings and proceedings held by the Arbitration Panel shall take place in
New York, New York unless otherwise mutually agreed by the Parties and the
Arbitration Panel.

(e) The resolution procedure described herein shall be governed by the
Commercial Rules of the American Arbitration Association and the Procedures for
Large, Complex, Commercial Disputes in effect as of the Commencement Date.

(f) Owner and User shall bear equally the fees, costs and expenses of the
Arbitration Panel in conducting any arbitration described in this Section 27.5.

 

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27.6 Governing Law. THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK,
WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND
TO THE UNDERLYING TRANSACTION EMBODIED HEREBY. ACCORDINGLY, IN ALL RESPECTS THIS
AGREEMENT (AND ANY AGREEMENT FORMED PURSUANT TO THE TERMS HEREOF) SHALL BE
GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OR CONFLICTS OF LAW) AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.

27.7 Waiver of Trial by Jury. EACH OF OWNER AND USER ACKNOWLEDGES THAT IT HAS
HAD THE ADVICE OF COUNSEL OF ITS CHOICE WITH RESPECT TO ITS RIGHTS TO TRIAL BY
JURY UNDER THE CONSTITUTION OF THE UNITED STATES AND THE STATES OF NEVADA AND
NEW YORK. EACH OF OWNER AND USER HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY
JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (i) ARISING UNDER THIS
AGREEMENT (OR ANY AGREEMENT FORMED PURSUANT TO THE TERMS HEREOF) OR (ii) IN ANY
MANNER CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF OWNER AND USER
WITH RESPECT TO THIS AGREEMENT (OR ANY AGREEMENT FORMED PURSUANT TO THE TERMS
HEREOF) OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH; OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREINAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR
TORT OR OTHERWISE; EACH OF OWNER AND USER HEREBY AGREES AND CONSENTS THAT ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY A COURT TRIAL
WITHOUT A JURY, AND THAT EITHER PARTY MAY FILE A COPY OF THIS SECTION WITH ANY
COURT AS CONCLUSIVE EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF
ITS RIGHT TO TRIAL BY JURY.

27.8 Entire Agreement. This Agreement (including the Exhibits and Schedules
hereto) constitutes the entire and final agreement of the Parties with respect
to the subject matter hereof, and may not be changed or modified except by an
agreement in writing signed by the Parties. Owner and User hereby agree that all
prior or contemporaneous oral understandings, agreements or negotiations
relative to the use of the Golf Courses are merged into and revoked by this
Agreement (together with the related agreements referenced above).

27.9 Headings. All captions, titles and headings to sections, subsections,
paragraphs, exhibits or other divisions of this Agreement, and the table of
contents, are only for the convenience of the Parties and shall not be construed
to have any effect or meaning with respect to the other contents of such
sections, subsections, paragraphs, exhibits or other divisions, such other
content being controlling as to the agreement among the Parties.

27.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be a valid and binding original, but all of
which together shall constitute one and the same instrument. This Agreement may
be effectuated by the exchange of electronic copies of signatures (e.g., .pdf),
with electronic copies of this executed Agreement having the same force and
effect as original counterpart signatures hereto for all purposes.

 

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27.11 Interpretation. Both Owner and User have been represented by counsel and
this Agreement and every provision hereof has been freely and fairly negotiated.
Consequently, all provisions of this Agreement shall be interpreted according to
their fair meaning and shall not be strictly construed against any party.

27.12 Further Assurances. The Parties agree to promptly sign all documents
reasonably requested to give effect to the provisions of this Agreement.

27.13 Confidential Information. Each Party hereby agrees to, and to cause its
Representatives to, maintain the confidentiality of all non-public information
received pursuant to this Agreement (including the names of any and all
individuals that use any Complimentary Golf Rounds (the “Protected Names”));
provided that nothing herein shall prevent any Party from disclosing any such
non-public information (a) other than with respect to the Protected Names, in
the case of Owner, to any Affiliate of Owner, (b) in the case of User, to any
Affiliate of User, (c) in any legal, judicial or administrative proceeding or
other compulsory process or otherwise as required by applicable Legal
Requirements (in which case the disclosing Party shall promptly notify the other
Parties, in advance, to the extent permitted by law), (d) upon the request or
demand of any regulatory authority having jurisdiction over a Party or its
affiliates (in which case the disclosing Party shall, other than with respect to
routine, periodic inspections by such regulatory authority, promptly notify the
other Parties, in advance, to the extent permitted by law), (e) to its
Representatives who are informed of the confidential nature of such information
and have agreed to keep such information confidential (and the disclosing Party
shall be responsible for such Representatives’ compliance therewith), (f) to the
extent any such information becomes publicly available other than by reason of
disclosure by the disclosing Party or any of its respective Representatives in
breach of this Section 27.13, (g) other than with respect to the Protected
Names, to the extent that such information is received by such Party from a
third party that is not, to such Party’s knowledge, subject to confidentiality
obligations owing to the other Parties or any of their respective affiliates or
related parties or (h) other than with respect to the Protected Names, to the
extent that such information is independently developed by such Party. The
foregoing shall not preclude Owner from sending Owner’s golf offers and other
promotional materials to (i) any individual that uses any Complimentary Golf
Rounds, provided Owner has independently obtained the name and contact
information of such individual (i.e., other than by reason of such individual’s
use of any Complimentary Golf Rounds) and such individual has consented to
receive such promotional materials, and (ii) any individual that has golfed at
any of the Golf Courses prior to the Commencement Date and whose name and
contact information are included in the Golf Database Information (as such term
is defined on Exhibit C attached hereto), provided such individual has consented
to receive such promotional materials. Each of the Parties acknowledges that it
and its Representatives may receive material non-public information with respect
to the other Party and its Affiliates and that each such Party is aware (and
will so advise its Representatives) that federal and state securities laws and
other applicable laws may impose restrictions on purchasing, selling, engaging
in transactions or otherwise trading in securities of the other Party and its
Affiliates with respect to which such Party or its Representatives has received
material non-public information so long as such information remains material
non-public information

 

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27.14 Time of Essence. TIME IS OF THE ESSENCE OF THIS AGREEMENT AND EACH
PROVISION HEREOF IN WHICH TIME OF PERFORMANCE IS ESTABLISHED.

27.15 Consents, Approval and Notices.

(a) All consents and approvals that may be given under this Agreement shall, as
a condition of their effectiveness, be in writing. The granting of any consent
or approval by Owner or User to the performance of any act by User or Owner
requiring the consent or approval of Owner or User under any of the terms or
provisions of this Agreement shall relate only to the specified act or acts
thereby consented to or approved and, unless otherwise specified, shall not be
deemed a waiver of the necessity for such consent or approval for the same or
any similar act in the future, and/or the failure on the part of Owner or User
to object to any such action taken by User or Owner without the consent or
approval of the other Party, shall not be deemed a waiver of their right to
require such consent or approval for any further similar act; and User hereby
expressly covenants and agrees that as to all matters requiring Owner’s consent
or approval under any of the terms of this Agreement, User shall secure such
consent or approval for each and every happening of the event requiring such
consent or approval, and shall not claim any waiver on the part of Owner of the
requirement to secure such consent or approval.

(b) Each Party acknowledges that in granting any consents, approvals or
authorizations under this Agreement, and in providing any advice, assistance,
recommendation or direction under this Agreement, neither such Party nor any
Affiliates thereof guarantee success or a satisfactory result from the subject
of such consent, approval, authorization, advice, assistance, recommendation or
direction. Accordingly, each Party agrees that neither such Party nor any of its
Affiliates shall have any liability whatsoever to any other Party or any third
person by reason of: (i) any consent, approval or authorization, or advice,
assistance, recommendation or direction, given or withheld; or (ii) any delay or
failure to provide any consent, approval or authorization, or advice,
assistance, recommendation or direction (except in the event of a breach of a
covenant herein not to unreasonably withhold or delay any consent or approval);
provided, however, each agrees to act in good faith when dealing with or
providing any advice, consent, assistance, recommendation or direction.

(c) Any notice, report or information required to be delivered by User hereunder
may be delivered collectively with any other notices, reports or information
required to be delivered by User hereunder as part of a single report, notice or
communication. Any such notice, report or information may be delivered to Owner
by User providing a representative of Owner with access to User’s or its
Affiliate’s electronic databases or other information systems containing the
applicable information and notice that information has been posted on such
database or system.

27.16 Apportionment of Revenue and Expenses. For the avoidance of doubt, the
Parties hereby acknowledge that (a) all items of operating revenue and operating
expenses of each Golf Course, with respect to the period prior to 12:00 a.m.
local time (the “Cut-off Time”) at such Golf Course on the Commencement Date,
shall be for the account of the entity that owned such Golf Course on the day
immediately preceding the Commencement Date, and (b) all items of operating
revenue and operating expenses of each Golf Course, with respect to the period
from and after the Cut-off Time, shall be for the account of Owner.

 

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27.17 Single, Indivisible Agreement. This Agreement constitutes one indivisible
usage agreement with respect to the Golf Courses and not separate usage
agreements governed by similar terms. The Golf Courses constitutes one economic
unit, and each of the Golf Course Use Payments and all other provisions have
been negotiated and agreed upon based on usage of all of the Golf Courses by
User as a single, composite, inseparable transaction and would have been
substantially different had separate usage agreements or a divisible usage
agreement been intended. Except as expressly provided in this Agreement for
specific, isolated purposes (and then only to the extent expressly otherwise
stated), all provisions of this Agreement apply equally and uniformly to all
components of the Golf Courses collectively as one unit. The Parties intend that
the provisions of this Agreement shall at all times be construed, interpreted
and applied so as to carry out their mutual objective to create an indivisible
usage agreement with respect to all of the Golf Courses and, in particular but
without limitation, that, for purposes of any assumption, rejection or
assignment of this Agreement under 11 U.S.C. Section 365, or any successor or
replacement thereof or any analogous state law, this is one indivisible and
non-severable usage agreement and executory contract dealing with one legal and
economic unit and that this Agreement must be assumed, rejected or assigned as a
whole with respect to all (and only as to all) of the Golf Courses. The Parties
may elect (in each Party’s respective sole discretion, but subject to the
applicable terms of this Agreement) to amend this Agreement from time to time to
exclude one or more components or portions of, and/or to include one or more
additional components as part of, the Golf Courses, and any such future
exclusion of or addition to the Golf Courses shall not in any way change the
indivisible and nonseverable nature of this Agreement and all of the foregoing
provisions shall continue to apply in full force. Furthermore, under certain
circumstances as more particularly and expressly provided in this Agreement
above, one or more of the Golf Courses hereunder may, subject to the provisions
of this Agreement, be removed from this Agreement and no longer be part of the
Golf Courses and such reduction of the Golf Courses shall not in any way change
the indivisible and nonseverable nature of this Agreement and all of the
foregoing provisions shall continue to apply in full force with respect to the
balance of the Golf Courses.

27.18 Termination of this Agreement. Wherever in this Agreement the action of
terminating this Agreement with respect to any Golf Course (or action of similar
import) is discussed, such action shall mean the termination of User’s rights in
and to the use of such Golf Course and the termination of such obligations of
User hereunder that concern solely such Golf Course (including, without
limitation, the obligations of User hereunder with respect to the portion of the
Complimentary Golf Rounds Fee attributable to such Golf Course), which, for the
avoidance of doubt, shall under no circumstances include or be deemed to include
the obligations of User hereunder with respect to all or any portion of the
Membership Fee). Notwithstanding anything in this Agreement to the contrary, if
this Agreement is terminated with respect to any Golf Course, such termination
shall not affect the applicable Term of this Agreement with respect to the
balance of the Golf Courses with respect to which this Agreement is not so
terminated, and this Agreement shall continue in

 

47

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full force and effect with respect to such balance of the Golf Courses, and User
shall remain obligated to pay the entirety of the Membership Fee (subject to the
third (3rd) sentence of Section 16.2(b)). Following any such termination, the
Parties shall execute an amendment to this Agreement to memorialize such
termination; provided, however the failure to do so will not affect the
effectiveness of such termination.

SIGNATURES ON FOLLOWING PAGE

 

48

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IN WITNESS WHEREOF, this Agreement has been executed by Owner and User as of the
date first written above.

OWNER:

 

RIO SECCO LLC, a Delaware limited liability company By:   /s/ John Payne   Name:
John Payne   Title: President

 

CASCATA LLC, a Delaware limited liability company By:   /s/ John Payne   Name:
John Payne   Title: President

 

CHARIOT RUN LLC, a Delaware limited liability company By:   /s/ John Payne  
Name: John Payne   Title: President

 

GRAND BEAR LLC, a Delaware limited liability company By:   /s/ John Payne  
Name: John Payne   Title: President

[Signatures continue on following pages]

 

Signature Page to Golf Course Use Agreement

--------------------------------------------------------------------------------

USER:

 

CAESARS ENTERPRISE SERVICES, LLC, a Delaware limited liability company By:   /s/
Eric Hession   Name: Eric Hession   Title: Chief Financial Officer

[Signatures continue on following pages]

 

Signature Page to Golf Course Use Agreement

--------------------------------------------------------------------------------

CEOC, LLC, a Delaware limited liability company By:   /s/ Eric Hession   Name:
Eric Hession   Title: Treasurer

[Signatures continue on following page]

 

Signature Page to Golf Course Use Agreement

--------------------------------------------------------------------------------

CLC:

 

CAESARS LICENSE COMPANY, LLC, a Nevada limited liability company,

  By:   /s/ Randall Eisenberg   Name:   Randall Eisenberg   Title:   Chief
Restructuring Officer

 

Signature Page to Golf Course Use Agreement

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EXHIBIT A-1

GOLF COURSES

1. Rio Secco (Henderson, NV)

2. Cascata (Boulder City, NV)

3. Chariot Run (Laconia, IN)

4. Grand Bear (Saucier, MS)

--------------------------------------------------------------------------------

EXHIBIT A-2

GROUND LEASED GOLF COURSES; EXISTING GROUND LEASES

Ground Leased Golf Courses

1. Cascata (Boulder City, NV)

Existing Ground Leases

1. Lease Agreement dated September 1, 1998, by and between the City of Boulder
City, a Nevada municipal corporation, as landlord (“Cascata Landlord”), and MGM
Grand Hotel, Inc., a Nevada corporation, as tenant (“Cascata Tenant”), evidenced
by Memorandum of Lease dated September 1, 1998, by and between Cascata Landlord
and Cascata Tenant, recorded September 23, 1998, in Book 980923 as Document
No. 00395 in the Official Records of Clark County, Nevada (as amended, modified,
supplemented and/or assigned from time to time)

--------------------------------------------------------------------------------

EXHIBIT B

USER RIGHTS AND PRIVILEGES

 

  •   Preferred access to tee times for guests of User’s (or User’s Affiliates’)
casinos and/or hotels located within the same markets as the Golf Courses, as
more particularly described on Schedule 1 attached hereto

 

  •   Preferred rates for guests of User’s (or User’s Affiliates’) casinos
and/or hotels located within the same markets as the Golf Courses, as more
particularly described on Schedule 2 attached hereto

 

  •   Availability for golf tournaments/events at preferred rates and discounts,
as more particularly described on Schedule 3 attached hereto

--------------------------------------------------------------------------------

Schedule 1

Preferred Blocked Slots

 

  •   On any and all dates (including, without limitation, during heavy traffic
periods around the Super Bowl and March Madness), a certain number of tee times
will be reserved (i.e., set aside) for User’s (or User’s Affiliates’) guests, as
follows:

 

  •   Cascata and Rio Secco: Slots will be blocked at each Golf Course for six
(6) tee times per day (up to a maximum of four (4) golfers per tee time), with
all such slots to be between the hours of 7 a.m. and 11 a.m., local time

 

  •   Grand Bear and Chariot Run: Slots will be blocked at each Golf Course for
three (3) tee times per day (up to a maximum of four (4) golfers per tee time),
with all such slots to be between the hours of 7 a.m. and 11 a.m., local time

 

  •   Once the above-described reserved tee times have been utilized, and at all
other times when tee time inventory is limited, Owner will make commercially
reasonable efforts to place User’s (or User’s Affiliates’) guests

Notwithstanding anything to the contrary contained herein, (i) any and all slots
for any reserved tee time that have not been utilized by User as of 72 hours
prior to the applicable tee time shall be forfeited by User and revert back to
Owner (and User shall thereafter have no right to utilize such slots), and
(ii) with respect to any date on which an event or tournament is being held at a
Golf Course, no slots will be blocked (i.e., no tee times will be reserved for
User’s (or User’s Affiliates’) guests) at such Golf Course on such date;
provided that, with respect to each Golf Course, Owner shall not host events or
tournaments at such Golf Course on more than 36 days in any 12-month period.

--------------------------------------------------------------------------------

Schedule 2

Discount Rate

 

  •   Tier Rate (Total Rewards members) can access blocked slots at a discount
consistent with past practice, as follows:

 

  •   Gold – 10% off the seasonal rack rate

 

  •   Platinum – 10% off the seasonal rack rate

 

  •   Diamond – 25% off the seasonal rack rate

 

  •   Seven Stars – 25% off the seasonal rack rate

Notwithstanding anything to the contrary contained herein, Owner reserves the
right to offer additional discounts at its discretion.

--------------------------------------------------------------------------------

Schedule 3

Events

 

  •   User will be entitled to a certain number of hosted event days at the Golf
Courses, as follows:

 

  •   Cascata and Rio Secco: With respect to each Golf Course, six (6) hosted
event days per year, provided that a maximum of 120 players will be allowed per
event day

 

  •   Grand Bear and Chariot Run: With respect to each Golf Course, two
(2) hosted event days per year, provided that a maximum of 120 players will be
allowed per event day

 

  •   At each of the above-described events, (1) a fifty percent (50%) discount
off the applicable rack green fees will apply and (2) merchandise
(pre-purchased) and food & beverage will be available at cost plus twenty
percent (20%)

Notwithstanding anything to the contrary contained herein, (i) each event under
this Schedule 3 requires a guaranteed number of players (such number to be
mutually and reasonably agreed upon by Owner and User), and (ii) any and all
events under this Schedule 3 must be booked nine (9) months in advance of the
event date. User shall have the right to designate which individuals shall have
which tee times at any event under this Schedule 3, provided the same is
communicated to Owner at least 24 hours in advance of the beginning of such
event.

--------------------------------------------------------------------------------

EXHIBIT C

OWNER RIGHTS AND PRIVILEGES

 

  •   Guaranteed access to use up to 120 rooms at User’s (or User’s Affiliates’)
hotels, at a cost equal to the best available NET rate per room, as more
particularly described on Schedule 1 attached hereto

 

  •   Certain rights and privileges of Owner with respect to User’s (or User’s
Affiliates’) casinos, hotels and/or other assets, as set forth on Schedule 2
attached hereto, to continue in a manner consistent with past practice

 

  •   If and to the extent feasible (as mutually and reasonably agreed upon by
Owner and User), transfers of the phone numbers currently utilized by the Golf
Courses

 

  •   To the extent permitted under applicable law, one time transfer (on a date
and at a time to be mutually and reasonably agreed upon by Owner and User) of
mutually agreed upon golf course database customer information, to be mutually
and reasonably agreed upon by Owner and User (the “Golf Database Information”)

--------------------------------------------------------------------------------

Schedule 1

Guaranteed Rooms

 

  •   60 of the 120 rooms will be available from Caesars Palace

 

  •   After accounting for the 60 rooms described in the first bullet point
above, the remaining 60 of the 120 rooms will be available from a combination of
Caesars Palace, Planet Hollywood, Harrah’s Las Vegas, The Linq and Paris

 

  •   At 60 days out, all of the 120 rooms that have not theretofore been booked
by Owner (if any) will be released back to the hotels; provided, however, that
if Owner has theretofore booked less than 60 rooms at Caesars Palace, then a
certain number of rooms, which number shall be equal to the lesser of (i) the
number of the 60 Caesars Palace rooms described in the first bullet point above
that have not theretofore been booked by Owner or (ii) 20, will continue to be
available from Caesars Palace until 14 days out

 

  •   At 14 days out, all of the 120 rooms (to the extent not theretofore booked
by Owner or already released back to the hotels) will be released back to the
hotels

--------------------------------------------------------------------------------

Schedule 2

Continued Owner Rights and Privileges

 

  •   Owner shall be entitled to the existing golf & hotel package offering that
includes Rio Secco and Cascata (in the same form as was being made available to
Owner immediately prior to the date hereof)

 

  •   Owner shall have the right to use the existing golf desk space in Caesars
Palace, Flamingo, Bally’s and Paris for no rent or other use payment, provided
that Owner shall pay all labor costs and other operating expenses for
maintaining such desk space

 

  •   Owner shall have the right to use retail kiosk space (comparable to such
space as is in existence as of the date hereof ) within User’s (or User’s
Affiliates’) casinos, which space will be staffed by casino employees and
include golf offerings

 

  •   Owner shall be entitled to exclusive mention of the Golf Courses on
websites of User’s (or User’s Affiliates’) hotels located within the same
markets as the Golf Courses (including links to the tee time booking engine,
phone number to golf call center, etc.)

 

  •   Golf reservation phone number shall be displayed in collateral, websites,
and other property of User’s (or User’s Affiliates’) hotels

 

  •   All of the concierge, VIP Services, sales departments, etc. of User’s (or
User’s Affiliates’) hotels shall refer golf inquiries exclusively to Owner

 

  •   User shall send an e-mail to the golf-course-specific Total Rewards
database six (6) times per year with a golf offer co-developed by Owner and User

--------------------------------------------------------------------------------

EXHIBIT D

CES USE FEE

 

Golf Course

   Q1      Q2      Q3      Q4      Total  

Rio Secco

   $ 156,108      $ 156,108      $ 156,108      $ 156,108      $ 624,434  

Cascata

   $ 329,149      $ 329,149      $ 329,149      $ 329,149      $ 1,316,598  

Chariot Run

   $ 130,242      $ 130,242      $ 130,242      $ 130,242      $ 520,968  

Grand Bear

   $ 134,500      $ 134,500      $ 134,500      $ 134,500      $ 538,000  

Total

   $ 750,000      $ 750,000      $ 750,000      $ 750,000      $ 3,000,000  

--------------------------------------------------------------------------------

EXHIBIT E-1

MINIMUM ROUNDS

 

Golf Course

   Minimum # of Complimentary Golf Rounds Per Month
(Minimum Rounds Per Month)      Total
(Minimum
Rounds
Per Year)      Rate        Jan      Feb      Mar      Apr      May      Jun     
Jul      Aug      Sep      Oct      Nov      Dec                

Rio Secco

     43        83        130        63        59        36        43        71  
     16        102        83        6        735      $ 199  

Cascata

     71        114        217        349        378        121        40       
44        102        261        115        15        1,827      $ 395  

Chariot Run

     21        52        120        252        359        345        398       
386        390        357        204        12        2,896      $ 69  

Grand Bear

     37        43        56        48        53        54        44        40  
     57        72        58        38        600      $ 109  

--------------------------------------------------------------------------------

EXHIBIT E-2

AGGREGATE MINIMUM ROUNDS

 

     Jan      Feb      Mar      Apr      May      Jun      Jul      Aug      Sep
     Oct      Nov      Dec      —      Total
(Aggregate
Minimum
Rounds
Per Year)  

Aggregate Minimum Rounds Per Month

     172        292        523        712        849        556        525     
  541        565        792        460        71        —          6,058  

--------------------------------------------------------------------------------

EXHIBIT F

APPROVED CAPITAL IMPROVEMENTS

 

1. The renovation of the Rio Secco Golf Course in accordance with the approved
project scope and budget applicable thereto (a copy of which is attached hereto
as Schedule 1)

--------------------------------------------------------------------------------

Schedule 1

Approved Project Scope and Budget for Renovation of Rio Secco Golf Course

On file with the Company.

--------------------------------------------------------------------------------

EXHIBIT G

LICENSED TRADEMARKS

Registered Trademarks

 

Mark

   Country      App. No.      App. Date      Reg. No.      Reg. Date      Status
     Owner  

Rio Secco Golf Club (Design)

     Nevada        32-041        5/27/1999        32-041        5/27/1999       
Registered       

Rio
Properties,
LLC  
 
 

Janelas (Design)

LOGO [g470550g1005105656589.jpg]

     United States        78/706472        9/2/2005        3126836       
8/8/2006        Registered       

Rio
Properties,
LLC  
 
 

Rio Secco Golf Club (Block)

     United States        75/370303        10/8/1997        2223924       
2/16/1999        Registered       

Rio
Properties,
LLC  
 
 

Unregistered Trademarks

1. RIO SECCO

--------------------------------------------------------------------------------

2.

  

LOGO [g470550g1005105656869.jpg]

3.

   LOGO [g470550g1005105657135.jpg]

4.

   LOGO [g470550g1005105657415.jpg]

5.

   JANELAS

6.

   LOGO [g470550g1005105657821.jpg]

--------------------------------------------------------------------------------

Domain Names

 

Domain Name

  

Owner

riosecco.com

   Rio Properties, LLC

riosecco.net

   CYBERGOLF

rioseccogolf.com

   Rio Properties, LLC

rioseccogolfclub.com

   Rio Properties, LLC

Social Media Applications

1. Twitter (twitter.com/riosecco)

2. Facebook (facebook.com/RioSeccoGolfClub)

3. LinkedIn (linkedin.com/company-beta/3918178/)

--------------------------------------------------------------------------------

EXHIBIT H

TERMS AND CONDITIONS FOR USE OF THE LICENSED TRADEMARKS

1. QUALITY CONTROL

1.1 In order to protect the Licensed Trademarks, Owner covenants and agrees as
follows:

(a) The nature and quality of all Products and Materials offered by or on behalf
of Owner in accordance with Section 2.1(c) of the Agreement shall be subject to
CLC’s approval to ensure they meet all standards and specifications which CLC
may from time to time give to Owner. Owner will comply with CLC’s existing
standards and specifications and with the Caesars Brand Standards Manual (the
“Manual”), if any, and with all changes in said standards and specifications and
in the Manual as they are made by CLC from time to time in its sole discretion.

(b) Owner will obtain CLC’s approval of any material changes in the
specifications and standards for any existing Products and Materials. Owner will
also obtain CLC’s approval of the specifications and standards for any new
Products and Materials that differ materially from existing Products and
Materials. If CLC does not respond to Owner’s request for approval within thirty
(30) days, Owner’s request for approval shall be deemed disapproved by CLC.

(c) Upon reasonable notice and solely to ascertain compliance with this
Section 1, representatives of CLC shall have the right during normal business
hours, to enter the premises of Owner to examine Owner’s business operations,
including Products and Materials in stock.

(d) At CLC’s reasonable request and expense, Owner shall, to the extent
reasonably feasible, provide to CLC samples of Products and Materials for CLC’s
review and inspection in order to evaluate Owner’s compliance with its
obligations under this Agreement.

(e) Subject to the terms and procedures of this Section 1, Owner shall make such
changes in the Products and Materials as shall be reasonably required by CLC to
comply with this Section 1.

(f) Notwithstanding any other provision of this Agreement, the Products and
Materials, and the manufacture, marketing, promotion, distribution and sale
thereof, shall comply with all applicable state, federal and local laws, rules
and regulations. To the best of Owner’s knowledge, the Products and Materials
being manufactured, advertised, publicized, promoted, marketed and sold as of
the Commencement Date, if any, comply with such laws, rules and regulations as
they exist at the time of the Commencement Date.

--------------------------------------------------------------------------------

1.2 In the event Owner fails to materially comply with the specifications and
standards established by CLC, CLC will furnish Owner with written notice
identifying such failure and, if reasonably necessary, identifying the steps to
cure such failure. Owner shall, upon receipt of such notification from CLC,
immediately commence and thereafter diligently pursue the correction of any
non-compliance and shall endeavor to achieve such correction within sixty
(60) days. If Owner fails to make such corrections within such time frame, Owner
shall, upon receipt of written notice from CLC: (a) cease the use, manufacture,
marketing, promotion, distribution or sale of the non-complying Products and
Materials; and (b) not resume the use, manufacture, marketing, promotion,
distribution or sale of such non-complying Products and Materials until it has
received written authorization from CLC to do so. CLC’s rights under this
Section 1.2 do not preclude CLC from the exercise of any rights it may have to
otherwise terminate Owner’s rights under this Agreement.

2. PROTECTION OF THE LICENSED TRADEMARKS

2.1 Owner acknowledges and agrees that:

(a) Owner shall acquire no ownership rights to any of the Licensed Trademarks by
virtue of this Agreement or otherwise, all uses by Owner of the Licensed
Trademarks and the goodwill created therein shall inure to the benefit of Rio,
and Owner will execute all documents reasonably requested by CLC or Rio to
evidence such ownership rights;

(b) Owner shall not, during the License Term, directly or indirectly, contest or
aid others in contesting Rio’s ownership of the Licensed Trademarks or the
validity of the Licensed Trademarks;

(c) Owner shall not, during the License Term, knowingly or negligently do
anything which impairs Rio’s ownership of or the validity of the Licensed
Trademarks; provided, however, that nothing herein shall require Owner to use
any Licensed Trademark; and

(d) Rio shall be responsible for maintaining or not maintaining the Licensed
Trademarks in full force and effect, by, among other means, preparing and filing
any and all necessary applications, affidavits, renewals or other documentation
as may be required by law to maintain the Licensed Trademarks and any
registrations thereof.

2.2 Owner may notify CLC of any infringement of the Licensed Trademarks or any
act of unfair competition by third parties relating to the Licensed Trademarks
whenever such infringement or act shall come to Owner’s attention. Owner
acknowledges that, as between the parties, CLC may, in its sole discretion, take
such action (including the initiation of proceedings and participation in
proceedings brought against Owner) to stop such infringement or act as CLC

--------------------------------------------------------------------------------

may deem necessary to protect the Licensed Trademarks. In connection therewith,
Owner shall cooperate to the extent reasonably requested to stop such
infringement or act, and, if so requested, shall join with CLC or Rio as a party
to any action brought by CLC or Rio for such purpose. As between the parties,
CLC shall have full control over any action taken, including without limitation,
the right to select counsel, to settle on any terms it deems advisable in its
sole discretion, to appeal any adverse decision rendered in any court, to
discontinue any action taken by it, and otherwise to make any decision in
respect thereto as it in its sole discretion deems advisable. As between the
parties, CLC shall bear all expenses connected with the foregoing. Any recovery
as a result of such action shall belong solely to CLC or Rio, as applicable.

3. TRADEMARK USAGE AND NOTICES

3.1 Owner shall use such trademark notices as shall be reasonably required by
CLC in connection with Owner’s use of the Licensed Trademarks, including the use
of such notices on Products and Materials.

3.2 Notwithstanding anything to the contrary herein, Owner shall apply to the
Products and Materials such notices and identifications as are required by law.

3.3 Owner agrees not to: (a) use the Licensed Trademarks in a descriptive or
generic manner; (b) use distinctive features of any Licensed Trademark separate
and apart from such Licensed Trademark; (c) combine any Licensed Trademark with
any third party trademark; (d) use any Licensed Trademark in conjunction with
any third party trademark so as to create an association with such third party
trademark; or (e) alter the Licensed Trademarks in any manner without CLC’s
express, written approval.

--------------------------------------------------------------------------------

EXHIBIT I

REQUIRED INSURANCE

 

I. Workers Compensation and Employers Liability Insurance

 

  A. Statutory workers compensation coverage

 

  B. Employers liability insurance:

$1,000,000 each accident

$1,000,000 disease, each employee

$1,000,000 disease, policy limit

 

II. Commercial General Liability Insurance

 

  A. Limits: $1,000,000 per occurrence

 $2,000,000 aggregate

 

  B. Limits may be met through a combination of primary and excess policies

 

  C. Products/Completed Operations

 

  D. Blanket Contractual Liability

 

  E. Independent Contractor Liability

 

  F. Broad Form Property Damage

 

  G. Cross Liability, Severability of Interests

 

  H. Personal and Advertising Injury

 

  I. Medical Expense Coverage

 

  J. Fire Legal Liability/Damage to Rented Premises

 

III. Commercial Automobile Liability Insurance (when Owner will be on any of
User’s Properties)

 

  A. Limits: $1,000,000 combined single limit

 

  B. Covers owned, hired and non-owned Vehicles

 

  C. Limits may be met through a combination of primary and excess policies

 

IV. Umbrella Liability Insurance

 

  A. Limits: $25,000,000 per occurrence and aggregate

 

  B. Provides excess limits over General Liability, Automobile Liability, and
Employers Liability coverages

 

  C. Coverage shall be no more restrictive than the applicable underlying
policies

 

V. Media Professional Liability / Cyber Liability

 

  A. Limits: $5,000,000 per occurrence and aggregate

 

  B. Coverage for various infringements including, but not limited to, claims
arising out of the actual or ALLEGED infringement of copyright, trademark, trade
name, trade dress, service mark, or service name.

 

  C. Coverage for failure to prevent denial of service, unauthorized access to,
unauthorized use of, tampering with or the introduction of malicious or damaging
code into firmware, data, software, systems or networks

 

  D. Coverage shall include Network Security and Privacy Liability, including:

 

  i. Coverage for unauthorized access/security breach and any form of invasion
of privacy including, but not limited to, the unauthorized disclosure of data,
private facts, or sensitive personal information

 

  ii. Coverage for liability arising from the failure to protect or the loss or
disclosure of private / confidential information

--------------------------------------------------------------------------------

  E. Coverage must be kept in force for at least two (2) years after termination
of this Agreement or an extended reporting period option of at least two
(2) years must be purchased

Evidence of Insurance:

Before the effective date of this Agreement, immediate upon the expiration or
replacement of any coverage above, and upon request from time-to-time but no
more than once per calendar year, Owner shall provide User with a Certificate of
Insurance in accordance with the foregoing and referencing the Golf Course Use
Agreement between Owner and User. Such certificate of insurance is to be
uploaded by Owner to their Caesars Ariba Supplier Profile in electronic format.
(Risk Management does not collect COI’s).

General Terms:

Owner agrees and represents that all policies of insurance referenced in this
section shall:

 

  1) be underwritten by insurers with a minimum A.M. Best rating of A-VII,

 

  2) be primary and non-contributory with respect to any insurance or
self-insurance program of User, and

 

  3) provide a waiver of subrogation in favor of User.

Owner further agrees that any subcontractors engaged by Owner will carry like
and similar insurance with the same additional insured requirements.

Additional Insureds:

Insurance required to be maintained by Owner pursuant to this section (excluding
workers compensation) shall name Caesars Enterprise Services, LLC, Caesars
Entertainment Operating Company, Inc., including its parents, subsidiaries,
affiliates, and managed entities (and their parents, subsidiaries, and
affiliates) that existed or may hereafter exist, and their respective agents,
officers, members, directors, employees, successors, and assigns, are included
as additional insureds. The coverage for an Additional Insured shall apply on a
primary basis and shall be to the full limits of liability purchased by Owner,
even if those limits are in excess of those required by this Agreement.

Self-Insurance:

In the event Owner elects to self-insure any of the coverage listed in this
section, the written approval of User must first be obtained and no
self-insurance limit can be over $1,000,000.

Representation of Insurance:

By requiring the insurance as set out in this section, User does not represent
that coverage and limits will necessarily be adequate to protect Owner, and such
coverage and limits shall not be deemed as a limitation on Owner’s liability
under the indemnities provided to User in this Agreement, or any other provision
of this Agreement.