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EXHIBIT 10.12

 

 
TRADEMARK SECURITY AGREEMENT

This TRADEMARK SECURITY AGREEMENT (this “Agreement”), entered into as of the
29th day of October 2009, by and between among Grantors listed on the signature
pages hereof (collectively, jointly and severally, “Grantors” and each
individually “Grantor”), and WELLS FARGO FOOTHILL, INC., a California
corporation, as agent for the Lenders (as defined in the hereinafter defined
Loan Agreement) (“Agent”).

W I T N E S S E T H:
 
WHEREAS, pursuant to that certain Amended and Restated Loan and Security
Agreement dated as of October 29, 2009 (as amended, restated, supplemented or
otherwise modified from time to time, the “Loan Agreement”), by and among
Peninsula Gaming, LLC, a Delaware limited liability company, Diamond Jo, LLC, a
Delaware limited liability company, The Old Evangeline Downs, L.L.C., a
Louisiana limited liability company, Diamond Jo Worth, LLC, a Delaware limited
liability company and Belle of Orleans, L.L.C., a Louisiana limited liability
company, as borrowers (collectively, “Borrowers”), the Lenders and Agent, the
Lender Group has agreed to extend credit to Borrowers from time to time pursuant
to the terms and conditions thereof; and

WHEREAS, it is a condition precedent to the extension of credit under the Loan
Agreement that Grantors shall have granted the security interest contemplated by
this Agreement;

NOW, THEREFORE, for and in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

1.           The Loan Agreement and the terms and provisions thereof are hereby
incorporated herein in their entirety by this reference thereto.  Capitalized
terms not otherwise defined herein shall have the meanings ascribed to those
terms in the Loan Agreement.
 
2.           To secure the complete and timely payment, performance and
satisfaction of (x) all covenants, agreements and liabilities of the Borrowers
under the Loan Documents and all now existing or hereafter arising Obligations
(including, without limitation, any interest, fees and other charges in respect
of the Loan Agreement and the other Loan Documents that would accrue but for the
filing of an Insolvency Proceeding with respect to any Borrower, regardless of
whether such claim is allowed in such Insolvency Proceeding), and (y) the
obligations of Grantors arising from this Agreement and any other Loan Document
to which Grantor are party (items (x) and (y) above are hereinafter referred to
as the “Secured Obligations”), each Grantor hereby grants to Agent, for the
benefit of the Lender Group, a security interest in, as and by way of a first
mortgage and security interest having priority over all other security
interests, with power of sale to the extent permitted by applicable law, all of
such Grantor's right, title and
 

 

LEGAL_US_W # 63043116.2
 
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interest in, to an under the following, whether presently existing or hereafter
created or acquired:  (a) all trademarks, trade names, corporate names, business
names, trade styles, service marks, logos, other source or business identifiers,
prints and labels on which any of the foregoing have appeared or appear, designs
and general intangibles of like nature (whether registered or unregistered), all
registrations and recordings thereof, and all applications in connection
therewith in the United States, Canada or any other country, including all
registrations, recordings and applications in the United States Patent and
Trademark Office or in any similar office or agency of the United States, Canada
or any State, Province or Territory thereof, or any other country or any
political subdivision thereof, including, without limitation, those listed on
Schedule 1 attached hereto and made a part hereof, and (i) all renewals thereof,
(ii) all income, royalties, damages and payments now and hereafter due and/or
payable under and with respect thereto, including, without limitation, payments
under all licenses entered into in connection therewith and damages and payments
for past or future infringements or dilutions thereof, (iii) the right to sue
for past, present and future infringements and dilutions thereof, (iv) the
goodwill of such Grantor's business symbolized by the foregoing and connected
therewith, and (v) all of such Grantor's rights corresponding thereto throughout
the world (all of the foregoing trademarks, trade names, registered trademarks
and trademark applications, service marks, registered service marks and service
mark applications, together with the items described in clauses (i)-(v) in this
paragraph 2(a), are sometimes hereinafter individually and/or collectively
referred to as the "Trademarks"); and (b) all proceeds of any and all of the
foregoing, including, without limitation, license royalties and proceeds of
infringement suits
 
3.           Each Grantor agrees that it will not, without Agent’s prior written
consent, enter into any agreement, including, without limitation, any license
agreement, which is inconsistent with this Agreement, and each Grantor further
agrees that it will not take any action, and will use its best efforts not to
permit any action to be taken by others subject to its control, including,
without limitation, licensees, or fail to take any commercially reasonable
action, which would in any material respect affect the validity or enforcement
of the rights transferred to Agent under this Agreement or the rights associated
with the Trademarks.
 
4.           Each Grantor represents and warrants that, from and after the date
hereof, (a) the Trademarks listed on Schedule 1 are all of the trademarks, trade
names, corporate names (other than the legal name of Grantors), business names,
trade styles, service marks, logos, other source or business identifiers, prints
and labels on which any of the foregoing have appeared or appear, designs and
general intangibles of like nature (whether registered or unregistered), all
registrations and recordings thereof, and all applications in connection
therewith in which Grantors now have any right, title or interest, and (b) the
Trademarks have not been adjudged invalid or unenforceable, and Grantors are the
legal and beneficial owner of the Trademarks free and clear of all liens, claims
or security interests other than (i) the lien of Agent, (ii) the lien in favor
of the Secured Notes Trustee securing the Secured Notes Documents, provided such
lien of the Secured Notes Trustee is subject to the Intercreditor Agreement at
all times, and (iii) the Liens described in clauses (b), (d) and (i) of the
definition of Permitted Liens.  If, prior to
 

 

LEGAL_US_W # 63043116.2
 
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the termination of this Agreement, any Grantor shall obtain rights to any new
trademarks, trade names, corporate names, business names, trade styles, service
marks, logos, other source or business identifiers, prints and labels on which
any of the foregoing have appeared or appear, designs or general intangibles of
like nature (whether registered or unregistered), any registrations and
recordings thereof, or any applications in connection therewith, the provisions
of paragraph 2 above shall automatically apply thereto.  Each Grantor shall give
to Agent prompt written notice of events described in the preceding sentence
promptly after the occurrence thereof.  Each Grantor authorizes Agent to modify
this Agreement by amending Schedule 1 to include any future trademarks, trade
names, corporate names, business names, trade styles, service marks, logos,
other source or business identifiers, prints and labels on which any of the
foregoing have appeared or appear, designs and general intangibles of like
nature (whether registered or unregistered), all registrations and recordings
thereof, and all applications in connection therewith which are or may become
Trademarks hereunder and to record such modifications (or notice thereof) in the
United States Patent and Trademark Office or with other applicable recording
office at the expense of Grantors.  Each Grantor agrees to execute any and all
instruments (including individual conditional assignments or security
agreements) necessary to confirm such amendment or to enable such recording.
 
5.             Each Grantor agrees, except to the extent such action would not
result in a Material Adverse Change,  not to abandon any Trademark without the
prior written consent of Agent, and  to take all action necessary to maintain in
force any registration of the Trademarks, in the United States Patent and
Trademark Office and in any other jurisdiction in which it is registered,
including (without limitation) any filing, to the extent permitted and
authorized by law, of any declarations under Sections 8 of the Trademark Act of
1946 (Lanham Act) and any renewals thereunder, with respect to the
Trademarks.  Any expense with regard to the foregoing shall be borne and paid
by  Grantors.
 
6.           At any time after the occurrence and during the continuance of an
Event of Default, Agent shall have the right, but shall not be obligated, to
bring suit in its own name to enforce the Trademarks and, if Agent shall
commence any such suit, each Grantor shall, at the request of Agent, do any and
all lawful acts and execute any and all proper documents required by Agent in
aid of such enforcement.  Each Grantor shall, upon demand, promptly reimburse
Agent for all costs and expenses incurred by Agent in the exercise of its rights
under this paragraph 6 (including, without limitation, reasonable fees and
expenses of attorneys and paralegals for Agent).
 
7.            (a)           Each Grantor hereby irrevocably designates,
constitutes and appoints Agent (and all officers and agents of Agent designated
by Agent in its sole and absolute discretion) as such Grantor's true and lawful
attorney-in-fact, and authorizes Agent and any of Agent's designees, in such
Grantor's or Agent’s name, to take any action and execute any instrument
necessary or advisable to accomplish the purposes of this Agreement, including,
without limitation, at any time after the occurrence and during the continuance
of an Event of Default, to (i) endorse such Grantor's name on all applications,
documents, papers and instruments necessary or desirable for Agent in the use of
the Trademarks, (ii) assign, pledge, convey or otherwise transfer title in or
dispose
 

 

LEGAL_US_W # 63043116.2
 
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of theTrademarks to anyone, (iii) grant or issue any exclusive or nonexclusive
license under the Trademarks to anyone, and (iv) take any other actions with
respect to the Trademarks as Agent deems in its best interest.  Each Grantor
hereby ratifies all that such attorney shall lawfully do or cause to be done by
virtue hereof.  This power of attorney is coupled with an interest and shall be
irrevocable until this Agreement is terminated.  Each Grantor acknowledges and
agrees that this Agreement is not intended to limit or restrict in any way the
rights and remedies of Agent under the Loan Agreement or any other Loan
Document, but rather is intended to facilitate the exercise of such rights and
remedies.
 
(b)           Agent shall have, in addition to all other rights and remedies
given it by the terms of this Agreement, all rights and remedies allowed by law
and the rights and remedies of a secured party under the Uniform Commercial Code
as enacted in any jurisdiction in which the Trademarks may be located or deemed
located.  Upon the occurrence and during the continuance of an Event of Default
and the election by Agent to exercise any of its remedies under the Uniform
Commercial Code as in effect in the State of New York with respect to the
Trademarks, each Grantor agrees to assign, convey and otherwise transfer title
in and to the Trademarks to Agent or any transferee of Agent and to execute and
deliver to Agent or any such transferee all such agreements, documents and
instruments as may be necessary, in Agent’s Permitted Discretion, to effect such
assignment, conveyance and transfer.  All of Agent’s rights and remedies with
respect to the Trademarks, whether established hereby, by the Loan Agreement or
by any other agreements or by law, shall be cumulative and may be exercised
separately or concurrently.  Notwithstanding anything set forth herein to the
contrary, it is hereby expressly agreed that Agent may exercise any of the
rights and remedies provided in this Agreement, the Loan Agreement or any of the
other Loan Documents.  Each Grantor agrees that any notification of intended
disposition of any of the Trademarks required by law shall be deemed reasonably
and properly given if given at least 10 days before such disposition; provided,
however, that Agent may give any shorter notice that is commercially reasonable
under the circumstances.  Each Grantor hereby acknowledges and agrees that such
notice, when filed, shall constitute a reasonable “authenticated notification of
disposition” within the meaning of Section 9-611 of the Uniform Commercial Code
as in effect from time to time in any jurisdiction.

8.           Upon the satisfaction in full of the Secured Obligations and the
termination of the Loan Agreement, including the Commitments of the Lenders
thereunder, Agent shall execute and deliver to Grantors all instruments as may
be necessary or proper to remove and terminate the security interest, and to
reassign to Grantors any and all right, title and interest in the Trademarks and
the goodwill of the business symbolized by the Trademarks, subject to any
disposition thereof which may have been made by Agent pursuant hereto.
 
9.           The provisions of this Agreement are severable, and if any clause
or provision shall be held invalid and unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect only such
clause or provision, or part thereof, in such jurisdiction, and shall not in any
manner affect such clause or provision in any other jurisdiction, or any other
clause or provision of this Agreement in any jurisdiction.
 

 

LEGAL_US_W # 63043116.2
 
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10.           This Agreement is subject to modification only by a writing signed
by the parties.
 
11.           The benefits and burdens of this Agreement shall inure to the
benefit of, and be binding upon, the respective successors and permitted assigns
of the parties.
 
12.           This Agreement may be executed in one or more counterparts, all of
which taken together shall constitute one and the same instrument and any of the
parties hereto may execute this Agreement by signing any such counterpart.
Delivery of an executed counterpart of this Agreement by telefacsimile shall be
equally as effective as delivery of an original, executed counterpart of this
Agreement.  Any party delivering an executed counterpart of this Agreement by
telefacsimile shall also deliver an original executed counterpart of this
Agreement, but the failure to deliver an original, executed counterpart shall
not affect the validity, enforceability, and binding effect of this Agreement.
 
13.           This Agreement shall be construed according to the internal laws
of the New York, without regard to the conflict of laws principles thereof.
 
14.           The powers conferred on Agent hereunder are solely to protect its
interest in the Trademarks and shall not impose any duty upon Agent to exercise
any such powers.  Except for the accounting for moneys actually received by
Agent pursuant hereto, Agent shall have no duty with respect to the Trademarks
or as to the taking of any necessary steps to preserve rights against prior
parties or any other rights pertaining to any of the Trademarks. Each reference
herein to any right granted to, benefit conferred upon or power exercisable,
exercised, or action taken by Agent shall be deemed to be a reference to, or be
deemed to have been so taken, as the case may be, by Agent in its capacity as
Agent pursuant to the Loan Agreement for the benefit of the Lender Group, all as
more fully set forth in the Loan Agreement.
 

 
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
 

 

LEGAL_US_W # 63043116.2
 
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IN WITNESS WHEREOF, each Grantor has caused this Trademark Security Agreement to
be executed and delivered by its duly authorized officer as of the date first
set forth above.
 

  PENINSULA GAMING, LLC, a Delaware limited liability company          
 
By:
/s/ Natalie Schramm       Name   Natalie Schramm       Title    CFO          

 

  DIAMOND JO, LLC, a Delaware limited liability company          
 
By:
/s/ Natalie Schramm       Name  Natalie Schra,,       Title    CFO          

  THE OLD EVANGELINE DOWNS, L.L.C., a Louisiana limited liability company      
   
 
By:
/s/ Natalie Schramm       Name  Natalie Schramm       Title    CFO          

  DIAMOND JO WORTH, LLC, a Delaware limited liability company          
 
By:
/s/ Natalie Schramm       Name   Natalie Schramm       Title     CFO          

  BELLE OF ORLEANS, L.L.C., a Louisiana limited liability company          
 
By:
/s/ Natalie Schramm       Name   Natalie Schramm       Title     CFO          

 
Trademark Security Agreement
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 ACCEPTED AND ACKNOWLEDGED BY:
 
WELLS FARGO FOOTHILL, INC., as Agent
       
/s/Patrick McCormack
   
 
 
Name:  Patrick McCormack
   
 
 
Title:    Vice President
   
 
 

 
 
Trademark Security Agreement
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SCHEDULE 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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