EXECUTION COPY

AMENDED AND RESTATED
CREDIT AGREEMENT

DATED AS OF SEPTEMBER 23, 2005

AMONG

CHURCHILL DOWNS INCORPORATED,

THE LENDERS,

THE GUARANTORS,

AND

JPMORGAN CHASE BANK, N.A.
(successor by merger to Bank One, NA)
AS AGENT AND COLLATERAL AGENT

WITH

PNC BANK, NATIONAL ASSOCIATION
AS SYNDICATION AGENT

AND

NATIONAL CITY BANK OF KENTUCKY
AS DOCUMENTATION AGENT

_______________________________________________________________

J.P. MORGAN SECURITIES INC. AND PNC CAPITAL MARKETS, INC.
AS CO-LEAD ARRANGERS AND JOINT BOOK RUNNERS

 

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TABLE OF CONTENTS

 
ARTICLE I. DEFINITIONS 
 
ARTICLE II. THE CREDITS 
2.1 Revolving Loan Commitment
2.2 Swing Line Loans.
2.2.1 Amount of Swing Line Loans.
2.3.2 Borrowing Notice.
2.2.3 Making of Swing Line Loans.
2.2.4 Repayment of Swing Line Loans
2.2.5 Working Cash Sweep Rider
2.3 Letter of Credit Subfacility.
2.3.1 Issuance.
2.3.2 Participations.
2.3.3 Notice
2.3.4 LC Fees
2.3.5 Administration; Reimbursement by Lenders
2.3.6  Reimbursement by Borrower
2.3.7 Obligations Absolute
2.3.8  Actions of LC Issuer
2.3.9 Indemnification
2.3.10 Lenders' Indemnification
2.3.11 Facility LC Collateral Account
2.3.12 Rights as a Lender
2.4 Required Payments; Termination
2.5 Ratable Loans
2.6 Types and Number of Eurodollar Advances
2.7 Commitment Fee; Reductions in Aggregate Commitment
2.8 Minimum Amount of Each Advance
2.9 Optional Principal Payments
2.10 Method of Selecting Types and Interest Periods for New Advances
2.11 Conversion and Continuation of Outstanding Advances
2.12 Changes in Interest Rate, etc
2.13 Rates Applicable After Default
2.14 Method of Payment
2.15 Noteless Agreement; Evidence of Indebtedness
2.16 Telephonic Notices
2.17 Interest Payment Dates; Interest and Fee Basis
2.18 Notification of Advances, Interest Rates, Prepayments and Commitment
Reductions
2.19 Lending Installations
2.20 Non-Receipt of Funds by the Agent
2.21 Replacement of Lender
2.22 Increase in Commitments
2.22.1  Amount of Increase in Commitments
2.22.2  Eligibility
2.22.3  Notice
2.22.4 Minimum Amount
2.22.5 Implementation of Increase
 
ARTICLE III. YIELD PROTECTION; TAXES 
3.1 Yield Protection
3.2 Changes in Capital Adequacy Regulations
3.3 Availability of Types of Advances
3.4 Funding Indemnification
3.5 Taxes
3.6 Lender Statements; Survival of Indemnity
 
ARTICLE IV. CONDITIONS PRECEDENT 
4.1. Initial Credit Extension
4.2 Each Credit Extension
 
ARTICLE V. REPRESENTATIONS AND WARRANTIES 
5.1 Existence and Standing
5.2 Authorization and Validity
5.3 No Conflict; Government Consent
5.4 Financial Statements
5.5 Material Adverse Change
5.6 Taxes
5.7 Litigation and Contingent Obligations
5.8 Subsidiaries
5.9 ERISA
5.10 Accuracy of Information
5.11 Regulation U
5.12 Material Agreements
5.13 Compliance With Laws
5.14 Ownership of Properties
5.15 Plan Assets; Prohibited Transactions
5.16 Environmental Matters
5.17 Investment Company Act
5.18 Public Utility Holding Company Act
5.19 Post-Retirement Benefits
5.20 Insurance
5.21 Solvency
5.22 Intellectual Property
5.23 Properties
5.24 Operating Locations
5.25 Certain Licenses.
5.26 Predecessor Entities of the Loan Parties
 
ARTICLE VI. COVENANTS 
6.1 Financial Reporting
6.2 Use of Proceeds
6.3 Notice of Default
6.4 Conduct of Business
6.5 Taxes
6.6 Insurance
6.7 Compliance with Laws
6.8 Maintenance of Properties
6.9 Inspection
6.10 Indebtedness
6.11 Merger
6.12 Sale of Assets
6.13 Investments and Acquisitions
6.14 Subsidiaries
6.15 Certain Transactions
6.16. Liens
6.17. Intentionally Omitted51
6.18. Rentals
6.19. Affiliates
6.20 No Prepayment of Material Indebtedness
6.21 Recordation of Calder Mortgage
6.22 Financial Contracts
6.23 Sale and Leaseback Transactions and other Off-Balance Sheet Liabilities
6.24. Financial Covenants
6.25 Loan Parties shall enter into Collateral Documents
6.26 Maintenance of Patents, Trademarks, Etc.
6.27 Plans and Benefit Arrangements
6.28 Compliance with Laws
6.29 Further Assurances
6.30 Subordination of Intercompany Loans
6.31 Plans and Benefit Arrangements
6.32 Issuance of Stock
6.33 Changes in Organizational Documents
6.35 Other Agreements
6.36 Preservation of Existence.
 
ARTICLE VII. DEFAULTS 
 
ARTICLE VIII. ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES 
8.1 Acceleration; Facility LC Collateral Accounts
8.2 Amendments
8.3 Preservation of Rights
 
ARTICLE IX. GENERAL PROVISIONS 
9.1 Survival of Representations
9.2 Governmental Regulation
9.3 Headings
9.4 Entire Agreement
9.5 Several Obligations; Benefits of this Agreement
9.6 Expenses; Indemnification
9.7 Numbers of Documents
9.8 Accounting
9.9 Severability of Provisions
9.10 Nonliability of Lenders
9.11 Confidentiality
9.12 Nonreliance
9.13 Disclosure
9.14 Joinder of Guarantors
9.15 Business Days
9.16 No Course of Dealing
9.17 Waivers by the Borrower
9.18 Incorporation by Reference
9.19  USA Patriot Act Notification
 
ARTICLE X. THE AGENT 
10.1 Appointment; Nature of Relationship
10.2 Powers
10.3 General Immunity
10.4 No Responsibility for Loans, Recitals, etc.
10.5 Action on Instructions of Lenders
10.6 Employment of Agents and Counsel
10.7 Reliance on Documents; Counsel
10.8 Agent's Reimbursement and Indemnification
10.9 Notice of Default
10.10 Rights as a Lender
10.11 Lender Credit Decision
10.12 Successor Agent
10.13 Agent and Arranger Fees.
10.14 Delegation to Affiliates
10.15 Execution of Collateral Documents
10.16 Collateral Releases
10.17. Co-Agents, Documentation Agent, Syndication Agent, etc
 
ARTICLE XI. SETOFF; RATABLE PAYMENTS 
11.1 Setoff
11.2 Ratable Payments
 
ARTICLE XII. BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS 
12.1 Successors and Assigns
12.2 Participations
12.2.1 Permitted Participants; Effect
12.2.2 Voting Rights
12.2.3 Benefit of Certain Provisions
12.3 Assignments
12.3.1 Permitted Assignments
12.3.2 Consents
12.3.3 Effect; Effective Date
12.3.4 Register
12.4 Dissemination of Information
12.5 Tax Treatment
 
ARTICLE XIII. NOTICES 
13.1 Notices
13.2 Change of Address
 
ARTICLE XIV. COUNTERPARTS; INTEGRATION; EFFECTIVENESS 
 
ARTICLE XV. CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL 
15.1 Choice of Law
15.2 Consent to Jurisdiction
15.3 Waiver of Jury Trial

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Exhibit A Borrower’s Counsel Opinion Requirements
Exhibit B Compliance Certificate
Exhibit C Form of Assignment and Assumption Agreement
Exhibit D Loan/Credit Related Money Transfer Instructions
Exhibit E Form of Note
Exhibit F Form of Notice of Acquisition
Exhibit G Intentionally Omitted
Exhibit H Form of Intercompany Subordination Agreement 
Exhibit I Forms of Mortgages and Deeds of Trust
Exhibit J Form of Negative Pledge Agreement
Exhibit K Form of Pledge and Security Agreement
Exhibit L Form of Lender Joinder
Exhibit M Form of Acquisition Compliance Certificate
Exhibit N Form of Guarantor Joinder
Exhibit O Form of Investment Compliance Certificate
Exhibit P Form of Certificate of Chief Financial Officer
Exhibit Q Form of Reimbursement Agreement
Exhibit R Form of Borrowing Notice
Exhibit S Form of Notice of Continuation / Conversion
Schedule 1 Subsidiaries and other Investments
Schedule 2 Indebtedness and Liens
Schedule 3 Less Than 100% Subsidiaries
Schedule 4.1(i)(p) Jurisdiction for Personal Property Searches
Schedule 4.1(i)(q) Certain Required Third Party Consents
Schedule 5.22 Intellectual Property
Schedule 5.23 Real Property
Schedule 5.24 Operating Locations
Schedule 5.25 Licenses
Schedule 5.26 Predecessor Entities
Schedule 6(a) Louisiana Mortgages
Schedule 6.22 Existing Rate Management Transactions

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AMENDED AND RESTATED CREDIT AGREEMENT

This Amended and Restated Credit Agreement, dated as of September 23, 2005, is
among CHURCHILL DOWNS INCORPORATED, the GUARANTORS party hereto, the LENDERS
party hereto, the DEPARTING LENDERS, if any, party hereto and JPMORGAN CHASE
BANK, N.A. (successor by merger to Bank One, NA), a national banking
association, as AGENT and as COLLATERAL AGENT to amend and restate the Previous
Credit Agreement, which is hereby amended and restated in its entirety.

WHEREAS, the Borrower has requested, and the Agent, the Collateral Agent, the
Departing Lenders and the Lenders have agreed, to amend the Previous Credit
Agreement;
 
WHEREAS, the Borrower, the Lenders, the Departing Lenders, the Collateral Agent
and the Agent have agreed (a) to enter into this Agreement in order to (i) amend
and restate the Previous Credit Agreement in its entirety; (ii) re-evidence the
Obligations, which shall be repayable in accordance with the terms of this
Agreement; and (iii) set forth the terms and conditions under which the Lenders
will, from time to time, make loans and extend other financial accommodations to
or for the benefit of the Borrower and (b) that each Departing Lender shall
cease to be a party to the Previous Credit Agreement, as evidenced by its
execution and delivery of its Departing Lender Signature Page; and
 
WHEREAS, it is the intention of the parties to this Agreement that this
Agreement not constitute a novation and that, from and after the Closing Date,
the Previous Credit Agreement shall be amended and restated hereby and all
references herein to “hereunder,”“hereof,” or words of like import and all
references in any other Loan Document to the “Credit Agreement” or words of like
import shall mean and be a reference to the Previous Credit Agreement as amended
and restated hereby (and any section references to the Previous Credit Agreement
shall refer to the applicable equivalent provision set forth herein although the
section number thereof may have changed);
 
NOW, THEREFORE, in consideration of the terms and conditions contained herein,
and of any loans or extensions of credit heretofore, now or hereafter made to or
for the benefit of the Borrower by the Lenders and the Agent, the parties hereto
agree as follows:
 
ARTICLE I

DEFINITIONS

1.1  
Certain Defined Terms. As used in this Agreement:

 
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
other Loan Party (i) acquires any going business or all or substantially all of
the assets of any Person, or division thereof, whether through purchase of
assets, merger or otherwise or (ii) directly or indirectly acquires (in one
transaction or as the most recent transaction in a series of transactions) at
least a majority (in number of votes) of the securities of a corporation which
have ordinary voting power for the election of directors (other than securities
having such power only by reason of the happening of a contingency) or a
majority (by percentage or voting power) of the outstanding ownership interests
of a partnership or limited liability company.

"Acquisition Compliance Certificate" has the meaning given it in Section 6.13.

“Adjusted EBITDA” of any person for any period means the EBITDA for that Person
for that period adjusted on a pro forma basis for the EBITDA of acquired or
divested operations, provided that any EBITDA of Churchill Downs Louisiana
Horseracing Company, L.L.C., Churchill Downs Louisiana Video Poker Company,
L.L.C. and Video Services, Inc. (whether positive or negative) for any period
prior to October 14, 2004 will not be included in the Adjusted EBITDA of those
entities.

"Advance" means a borrowing hereunder, (i) made by the Lenders on the same
Borrowing Date, or (ii) converted or continued by the Lenders on the same date
of conversion or continuation, consisting, in either case, of the aggregate
amount of the several Loans of the same Type and, in the case of Eurodollar
Loans, for the same Interest Period. The term "Advance" shall include Swing Line
Loans unless otherwise expressly provided.

"Affected Lender" has the meaning given it in Section 2.21.

"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.

"Agent" means JPMorgan in its capacity as contractual representative of the
Lenders pursuant to Article X, and not in its individual capacity as a Lender,
and any successor Agent appointed pursuant to Article X.

"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced or increased from time to time pursuant to the terms hereof.

"Aggregate Outstanding Credit Exposure" means, at any time, the aggregate of the
Outstanding Credit Exposure of all the Lenders.

"Agreement" means this Amended and Restated Credit Agreement, as it may be
amended or modified and in effect from time to time.

"Agreement Accounting Principles" means generally accepted accounting principles
as in effect from time to time, applied in a manner consistent with that used in
preparing the financial statements referred to in Section 5.4.

"Alternate Base Rate" means, for any day, a rate of interest per annum equal to
the higher of (a) the Prime Rate in effect for such date and (b) the sum of the
Federal Funds Effective Rate in effect for such day plus 1/2% per annum.

"Applicable Fee Rate" means, at any time, the percentage rate per annum at which
the Commitment Fee is accruing on the unused portion of the Aggregate Commitment
at such time as set forth in the Pricing Schedule.

"Applicable Margin" means, with respect to Advances of any Type at any time, the
percentage rate per annum which is applicable at such time with respect to
Advances of such Type as set forth in the Pricing Schedule.

"Approved Fund" means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

"Arranger" means collectively, J.P. Morgan Securities Inc., and its successors,
and PNC Capital Markets, Inc., a Pennsylvania corporation, and its successors,
in their capacity as Co-Lead Arrangers and Joint Book Runners.

"Assignment of Patents, Trademarks and Copyrights" shall mean the Assignment of
Patents, Trademarks and Copyrights from time to time executed by the Loan
Parties in favor of the Collateral Agent, as amended, restated, supplemented or
otherwise modified from time to time.

"Article" means an article of this Agreement unless another document is
specifically referenced.

"Authorized Officer" means any of the chief executive officer, chief financial
officer, any executive vice president, any senior vice president, the treasurer,
and any other officer designated as such by the board of directors of the
Borrower, acting singly.

"Available Aggregate Commitment" means, at any time, the Aggregate Commitment
then in effect minus the Aggregate Outstanding Credit Exposure at such time.

"Benefit Arrangement" shall mean at any time an "employee benefit plan," within
the meaning of Section 3(3) of ERISA, which is neither a Plan nor a
Multiemployer Plan and which is maintained, sponsored or otherwise contributed
to by any member of the Controlled Group.

"Borrower" means Churchill Downs Incorporated, a Kentucky corporation, and its
successors and assigns.

"Borrowing Date" means a date on which an Advance is made hereunder.

"Borrowing Notice" is defined in Section 2.10, and shall be in a form
satisfactory to the Agent, generally in the form of Exhibit R.

"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Louisville and New York City for the conduct
of substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in United States
dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Louisville for the conduct of substantially all of their commercial
lending activities and interbank wire transfers can be made on the Fedwire
system.

"CDMC" shall mean Churchill Downs Management Company, a Kentucky corporation,
and wholly owned subsidiary of the Borrower.

"Calder" means Calder Race Course, Inc., a Florida corporation.
 
“Calder Financing Statements” is defined in Section 6.21.
 
"Calder Mortgage" means the Mortgage executed by Calder in favor of the
Collateral Agent with respect to the Real Property owned by Calder. Calder
executed the Calder Mortgage and delivered such Calder Mortgage to the Agent on
the Previous Closing Date in a form sufficient for recordation and the Agent may
hereafter record such Mortgage at any time pursuant to Section 6.21.
 
"Capitalized Lease" of a Person means any lease of Property by such Person as
lessee which would be capitalized on a balance sheet of such Person prepared in
accordance with Agreement Accounting Principles.

"Capitalized Lease Obligations" of a Person means the amount of the obligations
of such Person under Capitalized Leases which would be shown as a liability on a
balance sheet of such Person prepared in accordance with Agreement Accounting
Principles.

"Cash Equivalent Investments" means (i) short-term obligations of, or fully
guaranteed by, the United States of America, (ii) commercial paper rated A-1 or
better by S&P or P-1 or better by Moody's, (iii) demand deposit accounts
maintained in the ordinary course of business, and (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000; provided in each case that
the same provides for payment of both principal and interest (and not principal
alone or interest alone) and is not subject to any contingency regarding the
payment of principal or interest.

"Change in Control" means the occurrence of any of the following: Any person (as
such term is used in Section 13(d) and Section 14(d)(2) of the Exchange Act as
in effect on the date of the Closing Date) or related Persons constituting a
group (as such term is used in Rule 13d-5 under the Exchange Act), other than a
group including, and under the general supervision of, the Excluded Group: (i)
become the "beneficial owners" (as such term is used in Rule 13d-3 under the
Exchange Act as in effect on the date of the Closing Date), directly or
indirectly, of more than 50% of the total voting power of all classes then
outstanding of the voting stock or membership or other equity interests of the
Borrower, or (ii) acquire after the date of the Closing Date (x) the power to
elect, appoint or cause the election or appointment of at least a majority of
the members of the board of directors of the Borrower, through beneficial
ownership of the capital stock of the Borrower or otherwise, or (y) all or
substantially all of the properties and assets of the Borrower.

"Change" has the meaning given it in Section 3.2.

"Closing Date" means September 23, 2005.

"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.

"Collateral" means and includes, collectively but without limitation, all
property and assets in which the Loan Parties grant the Collateral Agent for the
benefit of the Lenders an interest as collateral or other security for all or
any of the Secured Obligations, whether real or personal property, whether
granted directly or indirectly, whether granted now or in the future, and
whether granted in the form of a security interest, mortgage, deed of trust,
assignment, pledge, chattel mortgage, chattel trust, factor's lien, equipment
trust, conditional sale, trust receipt, lien, charge, lien or title retention,
contract, lease or consignment agreement intended as a security device, or any
other security or lien interest whatsoever, whether created by law, contract or
otherwise and is intended to and shall include all real and personal property,
tangible and intangible, of the Loan Parties; provided, however, the term
Collateral shall not include (i) the Horseman's Account, (ii) the bond issued
under the Master Plan Bond Transaction and payments owed by one Loan Party to
another Loan Party in connection with the Master Plan Bond Transaction, (iii)
ownership interests of any Loan Party in any (a) Excluded Subsidiary, (b) any
Excluded Entity, and (c) those Persons listed on Schedule 3 hereto in which, as
of the Closing Date, a Loan Party directly or indirectly owns less than 100% of
the outstanding interest of such Person and in which the organizational
agreements governing such Person prohibit the applicable Loan Party from
granting a security interest in such ownership interest, and (iv) any chattel
paper, contract rights or other general intangibles which are now held or
hereafter acquired by any Loan Party to the extent that such chattel paper,
contract rights or other general intangibles (including, but not limited to,
licenses) are not assignable or capable of being encumbered (a) as a matter of
law or (b) under the terms of any agreement applicable thereto (but solely to
the extent that any such restriction is enforceable and not ineffective under
applicable law) without the consent of the other party to such agreement where
such consent has not been obtained after the applicable Loan Party has made a
reasonably diligent effort satisfactory to the Agent to obtain such consent.

"Collateral Agent" means JPMorgan in its capacity as contractual representative
of the Lenders as Collateral Agent hereunder, and not in its individual capacity
as a Lender.

“Collateral Documents” means, collectively, all of the instruments, documents
and agreements executed in connection with this Agreement or the Previous Credit
Agreement by which any Person grants a security interest in Collateral,
including without limitation, those documents referenced in Section 6.25 of this
Agreement, which in turn includes without limitation, the Pledge and Security
Agreement, the Mortgages, the Negative Pledge Agreement, the Assignment of
Patents, Trademarks and Copyrights, the Intercompany Subordination Agreement,
the 2004B Collateral Documents, and all other documents or instruments executed
as security for the Secured Obligations from time to time, including, without
limitation, those entered into pursuant to Section 6.29 of this Agreement.

"Collateral Shortfall Amount" is defined in Section 8.1.

"Commitment" means, for each Lender, the obligation of such Lender to make
Revolving Loans to, and participate in Facility LCs issued upon the application
of, the Borrower in an aggregate amount not exceeding the amount set forth
opposite its signature below, as it may be modified as a result of any
assignment that has become effective pursuant to Section 12.3.2 or as otherwise
modified from time to time pursuant to the terms hereof.

"Commitment Fee" is defined in Section 2.7.

"Consolidated Adjusted EBITDA" for any Period means the consolidated Adjusted
EBITDA of all of the Loan Parties for that period, consolidated in accordance
with Agreement Accounting Principles. The EBITDA of the Excluded Subsidiaries
shall not be included in Consolidated Adjusted EBITDA, but EBITDA attributable
to the Borrower’s interest in Wagerco shall be included in Consolidated Adjusted
EBITDA in an amount not to exceed the amount of dividends and other similar
distributions actually received in cash by a Loan Party from Wagerco.

"Consolidated Funded Indebtedness" means at any time the aggregate dollar amount
of Consolidated Indebtedness which has actually been funded and is outstanding
at such time, whether or not such amount is due or payable at such time.
 
"Consolidated Indebtedness" means at any time the Indebtedness of the Loan
Parties calculated on a consolidated basis as of such time in accordance with
Agreement Accounting Principles.

"Consolidated Interest Expense" means, with reference to any period, the
interest expense of the Loan Parties calculated on a consolidated basis for such
period in accordance with Agreement Accounting Principles. The interest expense
paid by an Excluded Subsidiary shall not be included in Consolidated Interest
Expense.

"Consolidated Net Income" means, with reference to any period, the net income
(or loss) of all of the Loan Parties calculated on a consolidated basis for such
period in accordance with Agreement Accounting Principles.
 
"Consolidated Net Worth" means as of any date of determination total
stockholders' equity of all of the Loan Parties as of such date determined and
consolidated in accordance with Agreement Accounting Principles.

"Consolidated Rentals" means, with reference to any period, the Rentals of the
Loan Parties calculated on a consolidated basis for such period in accordance
with Agreement Accounting Principles.

"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any guaranty, comfort letter,
operating agreement, take-or-pay contract or the obligations of any such Person
as general partner of a partnership with respect to the liabilities of the
partnership.

"Controlled Group" means all members of a controlled group of corporations or
other business entities and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any of
its Subsidiaries, are treated as a single employer under Section 414 of the
Code.

"Conversion/Continuation Notice" is defined in Section 2.11, and shall be in a
form satisfactory to this Agent, generally in the form of Exhibit S.

"Credit Extension" means the making of an Advance or the issuance of a Facility
LC hereunder.

"Credit Extension Date" means the Borrowing Date for an Advance or the issuance
date for a Facility LC.

"Current Fields of Enterprise" means those fields of enterprise that each Loan
Party is engaged in as of the date of this Agreement, and activities related
thereto, including, but not limited to the acquisition of Persons that provide
wagering platforms, and shall not include any mode of gambling other than
pari-mutuel wagering on horse racing and Permitted Alternative Gaming which, in
each case, is conducted in full compliance with applicable law.

"Default" means one or more of the events described in Article VII.

“Departing Lender” means each lender under the Previous Credit Agreement that
executes and delivers to the Agent a Departing Lender Signature Page.
 
“Departing Lender Signature Page” means each signature page to this Agreement on
which it is indicated that the Departing Lender executing the same shall cease
to be a party to the Previous Credit Agreement on the Closing Date.
 
“EBITDA” for any Person for any period of determination means that Person’s net
income plus, to the extent deducted from revenues in determining net income, (i)
interest expense, (ii) expense for taxes paid or accrued, (iii) depreciation,
(iv) amortization, (v) extraordinary losses incurred other than in the ordinary
course of business, (vi) the one-time contribution by the Borrower of up to
$10,000,000 to the Churchill Downs Foundation and (vii) in the case of Ellis
Park Race Course, Inc., the lesser of (1) the one-time non-cash impairment
charge, if any, deducted from the net income of Ellis Park Race Course, Inc.
with respect to either the third fiscal quarter 2004 or the fourth fiscal
quarter 2004 (but not both quarters), or (2) $6,200,000.00; minus, to the extent
included in net income, that Person’s extraordinary gains realized other than in
the ordinary course of business and other than extraordinary gains arising from
“business interruption” insurance proceeds in connection with the Fair Grounds
Race Course and its related operations, in each case for such period determined,
in accordance with Agreement Accounting Principles.
 
"Environmental Laws" means all applicable federal, provincial, state and local
laws, rules, regulations, reported and publicly available orders, reported
judicial determinations, and reported and publicly available decisions of an
executive body or any governmental or quasi-governmental entity, whether in the
past, the present or the future, pertaining to health and/or the environment in
effect in any and all jurisdictions in which the Borrowers are at any time
leasing equipment pursuant to a Lease or otherwise doing business. The
Environmental Laws shall include, but shall not be limited to, the following:
(1) the Comprehensive Environmental Response, Compensation, and Liability Act,
42 U.S.C. Sections 9601, et seq.; the Superfund Amendments and Reauthorization
Act, Public Law 99-499, 100 Stat. 1613; the Resource Conservation and Recovery
Act, 42 U.S.C. Sections 6901, et seq.; the National Environmental Policy Act, 42
U.S.C. Section 4321; the Safe Drinking Water Act, 42 U.S.C. Sections 300F, et
seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601; the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801; the Federal Water
Pollution Control Act, 33 U.S.C. Sections 1251; et seq.; the Clean Air Act, 42
U.S.C. Section 7401, et seq.; and the regulations promulgated in connection
therewith; and (2) Environmental Protection Agency regulations pertaining to
asbestos (including 40 C.F.R. Part 61, Subpart M); Occupational Safety and
Health Administration regulations pertaining to asbes-tos (including 29 C.F.R.
Sections 1910.1001 and 1926.58); and any state, province and local laws and
regulations pertaining to Hazardous Materials and/or asbestos.
 
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and any rule or regulation issued thereunder.

"Eurodollar Advance" means an Advance which, except as otherwise provided in
Section 2.13, bears interest at the applicable Eurodollar Rate.

"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the applicable British Bankers' Association LIBOR rate
for deposits in U.S. dollars as reported on Page 3750 of the Dow Jones Market
Service or, if such service is not available, by any other generally recognized
financial information service as of 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, and having a maturity equal to
such Interest Period, provided that, if no such British Bankers' Association
LIBOR rate is available to the Agent, the applicable Eurodollar Base Rate for
the relevant Interest Period shall instead be the rate determined by the Agent
to be the rate at which JPMorgan or one of its Affiliate banks offers to place
deposits in U.S. dollars with first-class banks in the London interbank market
at approximately 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, in the approximate amount of JPMorgan's relevant
Eurodollar Loan and having a maturity equal to such Interest Period.

"Eurodollar Loan" means a Loan which, except as otherwise provided in Section
2.13, bears interest at the applicable Eurodollar Rate.

"Eurodollar Rate" means, with respect to a Eurodollar Advance for the relevant
Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base Rate
applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable Margin.

"Exchange Act" means the Securities Exchange Act of 1934.

"Excluded Entities" means any corporation, partnership, limited liability
company or other Person in which the Loan Parties hold an ownership interest,
either directly or indirectly, and which is not a Loan Party.
 
“Excluded Group” means and includes Duchossois Industries, Inc. and its
Affiliates.
 
“Excluded Subsidiaries” means any Excluded Entity which is a Subsidiary of the
Borrower. The Excluded Subsidiaries on the Closing Date are Hoosier Park, L.P.,
Churchill Downs Pennsylvania Company (formerly known as Churchill Downs
California Foodservices Company), Tracknet, LLC, Churchill Downs California
Company, Churchill Downs California Fall Operating Company, Anderson Park, Inc.
Fair Grounds International Ventures, L.L.C., a Louisiana limited liability
company, and F.G. Staffing Services, Inc., a Louisiana corporation.

"Excluded Taxes" means, in the case of each Lender or applicable Lending
Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.

"Exhibit" refers to an exhibit to this Agreement, unless another document is
specifically referenced.

"Facility LC" is defined in Section 2.3.1.

"Facility LC Application" is defined in Section 2.3.3.

"Facility LC Collateral Account" is defined in Section 2.3.11.

"Facility Termination Date" means September 23, 2010, or any earlier date on
which the Aggregate Commitment is reduced to zero or otherwise terminated
pursuant to the terms hereof.

“Fair Grounds Acquisition” shall have the meaning given it in Recital C of the
2004B Amendment.

“Fair Grounds Acquisition Documents” shall mean all of the documents through
which the Fair Grounds Acquisition is consummated, including, without
limitation, (a) the Third Amended Plan of Reorganization, filed in the United
States Bankruptcy Court for the Eastern District of Louisiana, Bankruptcy Case
No 03-16222, by Fair Grounds Corporation, as Debtor and Debtor-in-possession;
(b) the Order, dated September 28, 2004, entered by the United States Bankruptcy
Court for the Eastern District of Louisiana in Bankruptcy Case No 03-16222,
confirming the Third Amended Plan of Reorganization of Fair Grounds Corporation;
(c) the Asset Purchase Agreement, dated as of August 31, 2004, as amended by the
First Amendment, dated as September 17, 2004, among the Borrower, on behalf of
one of its wholly owned subsidiary to be formed, Fair Grounds Corporation and
the Borrower; (d) the Asset Purchase Agreement, dated as of October 14, 2004,
between Churchill Downs Louisiana Horseracing Company, L.L.C. and Finish Line
Management Corp.; and (e) the Stock Purchase Agreement, dated October 14, 2004,
between Churchill Downs Louisiana Video Poker Company, L.L.C. and Steven M.
Rittvo, Ralph Capitelli, T. Carey Wicker III and Louisiana Ventures, Inc..

“Fair Grounds Assignment and Subordination of Lease and Management Agreement”
shall mean the Assignment and Subordination of Lease and Management Agreement,
dated as of October 14, 2004, between Churchill Downs Louisiana Horseracing
Company, L.L.C., as Landlord, and Fair Grounds Corporation, as Tenant.

"Federal Funds Effective Rate" means, for any day, an interest rate per annum
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published on the next succeeding day (or, if such
day is not a Business Day, for the immediately preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations at approximately
10:00 a.m. (Louisville time) on such day on such transactions received by the
Agent from three Federal funds brokers of recognized standing selected by the
Agent in its sole discretion.

"Financial Contract" of a Person means (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, and/or (ii) any Rate Management
Transaction.

“First Amendment” means the 2004A Amendment to Loan Documents, dated as of June
1, 2004 among the Agent, the Guarantors party thereto and the Borrower.
 
"Floating Rate" means, for any day, a rate per annum equal to (i) the Alternate
Base Rate for such day plus (ii) the Applicable Margin, in each case changing
when and as the Alternate Base Rate changes.

"Floating Rate Advance" means an Advance which, except as otherwise provided in
Section 2.13, bears interest at the Floating Rate.

"Floating Rate Loan" means a Loan which, except as otherwise provided in Section
2.13, bears interest at the Floating Rate.

"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.

"Guarantor Joinder" is defined in Section 9.14.

"Guarantors" means, subject to Section 6.12(iii) collectively, Churchill Downs
Management Company, Churchill Downs Investment Company, Churchill Downs
Simulcast Productions, LLC, Charlson Industries, Inc., Racing Corporation of
America, Calder Race Course, Inc., Tropical Park, Inc., Arlington Park
Racecourse, LLC, Arlington Management Services, LLC, Arlington OTB Corp., Quad
City Downs, Inc., CDIP, LLC, CDIP Holdings, LLC, Ellis Park Race Course, Inc.,
Churchill Downs Louisiana Horseracing Company, L.L.C., Churchill Downs Louisiana
Video Poker Company, L.L.C., Video Services, Inc., any Person who becomes a
Guarantor under Section 9.14, and the successors and assigns of any of them, and
"Guarantor" means any one or more of these.

"Guaranty" means that certain Amended and Restated Guaranty dated as of the
Closing Date, executed by the Guarantors in favor of the Collateral Agent,
entered into pursuant to this Agreement, as amended, restated, supplemented or
otherwise modified and in effect from time to time.
 
"Hazardous Materials" means any substance, chemical, wastes (medical or
otherwise), or con-taminants, including, without limitation, asbestos,
polychlorinated biphenyls (“PCBs”), paint containing lead, gasoline or other
petroleum products, radioactive material, urea formaldehyde foam insulation, and
discharges of sewage or effluent that is designated or defined (either by
inclusion in a list of materials or by reference to exhibited characteristics)
as hazardous, toxic or dangerous, or as a designated or prohibited substance, in
any federal, state, provincial, municipal or local law, by-law, code having the
force of law, or ordinance, including, without limitation, the applicable
Environmental Laws, now existing or hereafter in effect, and all rules having
the force of law and regulations promulgated thereunder. 

"Horseman’s Account" means refundable deposits and amounts held by a Loan Party
for the benefit of horsemen, ownership of which deposits and amounts is vested
in such horsemen.

"Indebtedness" of a Person means such Person's (i) obligations for borrowed
money, (ii) obligations representing the deferred purchase price of Property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (iii) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
production from Property now or hereafter owned or acquired by such Person, (iv)
obligations which are evidenced by notes, acceptances, or other instruments, (v)
obligations of such Person to purchase securities or other Property arising out
of or in connection with the sale of the same or substantially similar
securities or Property, (vi) Capitalized Lease Obligations, (vii) LC
Obligations, (viii) aggregate undrawn stated amount under Letters of Credit that
are not Facility LCs, plus the aggregate amount of all reimbursement obligations
in connection therewith, and (ix) any other obligation for borrowed money or
other financial accommodation which in accordance with Agreement Accounting
Principles would be shown as a liability on the consolidated balance sheet of
such Person, but the term "Indebtedness" does not include trade payables and
accrued expenses, deferred revenue related to the annual running of the Kentucky
Derby, deferred revenue from the leasing or licensing of personal seat licenses,
and obligations not exceeding $3,000,000 under outstanding pari-mutuel tickets
that are payable with respect to races run not more than one year prior to the
date of determination which were incurred in the ordinary course of business,
which are not represented by a promissory note or other evidence of indebtedness
and (other than pari-mutuel tickets) which are not more than thirty (30) days
past due, all determined in accordance with Agreement Accounting Principles.

"Indemnity Agreement" shall mean the Environmental Indemnity Agreement, dated as
of the Previous Closing Date, among the Agent, the Borrower and the Guarantors
party thereto.

"Intercompany Subordination Agreement" shall mean a subordination agreement
among the Loan Parties in the form attached hereto as Exhibit H.

“Interest Coverage Ratio” means, as of any date of calculation, the ratio of (a)
Consolidated Adjusted EBITDA to (b) Consolidated Interest Expense, in each
instance computed as provided in Section 6.24.1 and in accordance with Agreement
Accounting Principles.
 
"Interest Period" means, with respect to a Eurodollar Advance, a period of one,
two, three or six months commencing on a Business Day selected by the Borrower
pursuant to this Agreement. Such Interest Period shall end on the day which
corresponds numerically to such date one, two, three or six months thereafter,
provided, however, that if there is no such numerically corresponding day in
such next, second, third or sixth succeeding month, such Interest Period shall
end on the last Business Day of such next, second, third or sixth succeeding
month. If an Interest Period would otherwise end on a day which is not a
Business Day, such Interest Period shall end on the next succeeding Business
Day, provided, however, that if said next succeeding Business Day falls in a new
calendar month, such Interest Period shall end on the immediately preceding
Business Day.

"Investment" of a Person means any loan, advance (other than commission, travel
and similar advances to officers and employees made in the ordinary course of
business), extension of credit (other than accounts receivable arising in the
ordinary course of business on terms customary in the trade) or contribution of
capital by such Person; stocks, bonds, mutual funds, partnership interests,
notes, debentures or other securities owned by such Person; any deposit accounts
and certificate of deposit owned by such Person; and structured notes,
derivative financial instruments and other similar instruments or contracts
owned by such Person.

“Jazz Fest Subordination Agreement and Estoppel” shall mean the Subordination,
Non-Disturbance and Attornment Agreement dated October 13, 2004, between The New
Orleans Jazz and Heritage Foundation, Inc., as Tenant, and the Collateral Agent
as mortgagee under the Mortgage defined therein, together with the Estoppel
Certificate by The New Orleans Jazz and Heritage Foundation, Inc. in favor of
the Agent and the Collateral Agent.

“JPMorgan” means JPMorgan Chase Bank, N.A. (successor by merger to Bank One,
NA), a national banking association, in its individual capacity, and its
successors.

"LC Fee" is defined in Section 2.3.4.

"LC Issuer" means PNC Bank (or any subsidiary or affiliate of PNC Bank
designated by PNC Bank) in its capacity as issuer of Facility LCs hereunder.

"Investment Compliance Certificate" is defined in Section 6.13(ii)(c).

"LC Obligations" means, at any time, the sum, without duplication, of (i) the
aggregate undrawn stated amount under all Facility LCs outstanding at such time
(including without limitation increases, if any, in the stated amount provided
in any Facility LC, whether or not the time for such increase has occurred) plus
(ii) the aggregate unpaid amount at such time of all Reimbursement Obligations.

"LC Payment Date" is defined in Section 2.3.5.

“LC Reimbursement Agreement” is defined in Section 2.3.3.

"Lenders" means the lending institutions (other than the Departing Lenders)
listed on the signature pages of this Agreement and their respective successors
and assigns, together with any lending institution that becomes a Lender under
Section 12.3. Unless otherwise specified, the term "Lenders" includes PNC Bank
in its capacity as Swing Line Lender.

"Lending Installation" means, with respect to a Lender or the Agent, the office,
branch, subsidiary or Affiliate of such Lender or the Agent listed on the
signature pages hereof or on a Schedule or otherwise selected by such Lender or
the Agent pursuant to Section 2.19.

"Letter of Credit" of a Person means a letter of credit or similar instrument
which is issued upon the application of such Person or upon which such Person is
an account party or for which such Person is in any way liable.

"Leverage Ratio" means, as of any date of calculation, the ratio of (i)
Consolidated Funded Indebtedness outstanding on such date to (ii) Consolidated
Adjusted EBITDA, in each instance computed in accordance with Section 6.24.2 and
Agreement Accounting Principles.

"Lien" means any lien (statutory or other), mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance or preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, the interest of a vendor or lessor under any
conditional sale, Capitalized Lease or other title retention agreement).

"Loan" means a Revolving Loan or a Swing Line Loan.

"Loan Documents" means this Agreement, the Facility LC Applications, the LC
Reimbursement Agreement, any Notes issued pursuant to Section 2.15, the
Collateral Documents, the Guaranty, and all other documents (excluding the
Working Cash Sweep Rider) and/or instruments executed and delivered pursuant to
and/or in connection with the Previous Credit Agreement or this Agreement.

"Loan Parties" means the Borrower and the Guarantors from time to time.

“Louisiana Mortgages” means the Mortgages, Assignments of Rents and Security
Agreements and the Leasehold Mortgages, Assignments of Rents and Security
Agreements and Deeds of Trust encumbering the Loan Parties’ fee or leasehold
interest in those properties listed on 6(a) of the 2004B Amendment and delivered
by each of the applicable Loan Parties with respect to each of the parcels of
real property listed on Schedule 6(a) to the Collateral Agent for the benefit of
the Lenders, as they may be amended and/or supplemented from time to time.

"Master Plan Bond Rentals" means rentals payable under the Master Plan Bond
Transaction.

"Master Plan Bond Transaction" means the transaction through which the City of
Louisville, Kentucky (n/k/a Louisville/Jefferson County Metro Government)
Taxable Industrial Building Revenue Bond, Series 2002 (Churchill Downs
Incorporated Project) was issued.

"Material Adverse Effect" means a material adverse effect on (i) the business,
Property, condition (financial or otherwise), results of operations, or
prospects, of the Loan Parties taken as a whole, (ii) the ability of the
Borrower to perform its obligations under the Loan Documents to which it is a
party, or (iii) the validity or enforceability of any of the Loan Documents or
the rights or remedies of the Agent, the LC Issuer, the Collateral Agent or the
Lenders thereunder.

"Material Indebtedness" means Indebtedness in an outstanding principal amount of
$3,000,000.00 or more in the aggregate (or the equivalent thereof in any
currency other than U.S. dollars), but does not include the Indebtedness under
the Convertible Promissory Note in the principal amount of $16,669,379.87 dated
October 19, 2004 payable to Brad M. Kelley.

"Material Indebtedness Agreement" means any agreement under which any Material
Indebtedness was created or is governed or which provides for the incurrence of
Indebtedness in an amount which would constitute Material Indebtedness (whether
or not an amount of Indebtedness constituting Material Indebtedness is
outstanding thereunder).

"Modify" and "Modification" are defined in Section 2.3.1.

"Moody's" means Moody's Investors Service, Inc.

"Mortgages" shall mean the Mortgages and Deeds of Trust in substantially the
form of collective Exhibit I previously executed and delivered by each of the
applicable Loan Parties with respect to each of the parcels of Real Property
Collateral to the Collateral Agent for the benefit of the Lenders. The Calder
Mortgage with respect to the Real Property in Florida was not recorded on the
Previous Closing Date, but the Agent may cause the Collateral Agent to record
the Calder Mortgage at any time pursuant to Section 6.21.

"Multiemployer Plan" means a Plan maintained pursuant to a collective bargaining
agreement or any other arrangement to which the Borrower or any member of the
Controlled Group is a party to which more than one employer is obligated to make
contributions.

"Negative Pledge Agreement" means that certain Negative Pledge Agreement in
substantially the form of Exhibit J executed and delivered by Calder and all the
Loan Parties in favor of the Agent with respect to all interest of the Loan
Parties in any Property of Calder, including without limitation any Property
subject to the Calder Mortgage and/or any Calder Financing Statements.

"Non-U.S. Lender" is defined in Section 3.5(iv).

"Note" is defined in Section 2.15(iv).

"Notice of Acquisition" is defined in Section 6.13(iii)(b).

"Obligations" means, collectively, all unpaid principal of and accrued and
unpaid interest on the Loans, all obligations, contingent or otherwise, under
and/or in connection with any Notes and/or to or for the benefit of any Lender
and/or the LC Issuer under and/or in connection with the other Loan Documents,
all Reimbursement Obligations, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Borrower to the Lenders
or to any Lender, the Agent, the Collateral Agent for the benefit of any Lender
or the LC Issuer, the LC Issuer or any indemnified party arising under the Loan
Documents, whether they exist on the date of this Agreement or the Previous
Credit Agreement, or arise or are created or acquired after the date of this
Agreement or the Previous Credit Agreement.

"Off-Balance Sheet Liability" of a Person means (i) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by
such Person, (ii) any liability under any Sale and Leaseback Transaction which
is not a Capitalized Lease, (iii) any liability under any so-called "synthetic
lease" transaction entered into by such Person, or (iv) any obligation arising
with respect to any other transaction which is the functional equivalent of or
takes the place of borrowing but which does not constitute a liability on the
balance sheets of such Person, but excluding from this clause (iv) Operating
Leases.

"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of the
lessor) of one year or more.

"Other Taxes" is defined in Section 3.5(ii).

"Outstanding Credit Exposure" means, as to any Lender at any time, the sum of
(i) the aggregate principal amount of its Loans outstanding at such time, plus
(ii) an amount equal to its Pro Rata Share of the LC Obligations at such time,
plus (iii) an amount equal to its Pro Rata Share of the aggregate principal
amount of Swing Line Loans outstanding at such time.
.
"Participants" is defined in Section 12.2.1.

"Payment Date" means the last day of each calendar quarter.

"PBGC" means the Pension Benefit Guaranty Corporation, or any successor thereto.

"Permitted Acquisitions" has the meaning given it in Section 6.13(iii).

"Permitted Alternative Gaming" means slot machines and/or video lottery
terminals and/or electronic gaming machines operated by one or more of the Loan
Parties at a facility owned or leased by, and operated by one or more of the
Loan Parties, and at which either (1) live horse racing is underway at that
facility and pari-mutuel wagering is being conducted with respect to those
races; and/or (2) live horse racing is being simulcast at that facility and
pari-mutuel wagering is being conducted with respect to those races.

“Permitted Investment” means a possible investment of up to $50,000,000 in
Wagerco.

"Permitted Liens" is defined in Section 6.16.

"Permitted Secured Rate Management Transaction" has the meaning given it in
Section 6.16(vii).

"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.

"Plan" means an employee pension benefit plan which is covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the Code
as to which the Borrower or any member of the Controlled Group may have any
liability.

"Pledge and Security Agreement" means the Amended and Restated Pledge and
Security Agreement in substantially the form of Exhibit K dated as of the
Closing Date and executed and delivered by each of the applicable Loan Parties
to the Collateral Agent for the ratable benefit of the Lenders, as amended,
restated, supplemented or otherwise modified and in effect from time to time.

"PNC Bank" means PNC Bank, National Association, a national banking association
having its principal office in Pittsburgh, Pennsylvania, and having an office in
Louisville, Kentucky, in its individual capacity, and its successors.

“Previous Closing Date” means April 3, 2003.

“Previous Credit Agreement” means that certain Credit Agreement dated as of
April 3, 2003 by and among the Borrower, the Guarantors party thereto, the
Lenders party thereto and the Agent, as the same has been amended prior to the
Closing Date.

“Pricing Schedule” means the Pricing Schedule attached to this Agreement.

"Prime Rate" means the rate of interest per annum publicly announced from time
to time by JPMorgan as its prime rate in effect at its principal office in New
York City; each change in the Prime Rate shall be effective from and including
the date such change is publicly announced as being effective.

"Prohibited Transaction" shall mean any prohibited transaction as defined in
Section 4975 of the Internal Revenue Code or Section 406 of ERISA for which
neither an individual nor a class exemption has been issued by the United States
Department of Labor.

"Pro Rata Share" means, with respect to a Lender, a portion equal to a fraction
the numerator of which is such Lender's Commitment and the denominator of which
is the Aggregate Commitment.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.

“PSL” means any agreement between any Loan Party and a Person providing for a
right to purchase or otherwise use seating accommodations in certain seating
locations at the Borrower's Property located on Central Avenue in Louisville,
Kentucky, known as the Churchill Downs racetrack facility, and which agreement
does not conflict with any of the Loan Documents, and/or result in a Default or
Unmatured Default, and expressly does not result in, or require, the creation or
imposition of any Lien in, leasehold interest in, rights in, claim to, easement
or easement by estoppel over, or similar rights or interests in any Property of
any such Loan Party, or result in, or require, the creation or imposition of any
right to possess specific property (other than the contractual right to purchase
or otherwise use the subject seating accommodations subject to the terms of such
agreement).

“PSL Buyback/Guarantee” means any promise to repurchase or buy back, guarantee
or otherwise provide credit support, directly or indirectly, given by any Loan
Party in favor of any financial institution or other Person in connection with
an obligation arising under a PSL Financing.

“PSL Financing” means any instance in which, pursuant to a PSL Financing
Program, a PSL Purchaser finances its obligations under a PSL, in whole or in
part, and which does not conflict with any of the Loan Documents, and/or result
in a Default or Unmatured Default.

“PSL Financing Program” means a financing arrangement program established by any
Loan Party with a financial institution or other Person pursuant to which such
financial institution or other Person agrees to finance, in whole or in part,
PSL Purchasers’ obligations under the PSLs, and which arrangement does not
conflict with any of the Loan Documents, and/or result in a Default or Unmatured
Default.

“PSL Purchaser” means the Person who enters into a PSL with any Loan Party.

"Purchasers" is defined in Section 12.3.1.

"Rate Management Obligations" of a Person means any and all obligations of such
Person, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.

"Rate Management Transaction" means any transaction (including an agreement with
respect thereto) now existing including, without limitation, those transactions
described on Schedule 6.22 or hereafter entered by the Borrower which is a rate
swap, basis swap, forward rate transaction, commodity swap, commodity option,
equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, forward transaction, currency swap transaction,
cross-currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions) or
any combination thereof, whether linked to one or more interest rates, foreign
currencies, commodity prices, equity prices or other financial measures.
"Real Property" means, collectively, each of the parcels of owned and/or leased
real property of any of the Loan Parties, all of which is listed on Schedule
5.23.
 
"Real Property Collateral" means each of the parcels of owned Real Property
listed on Schedule 5.23 except as set forth on such Schedule.
 
"Recorded Mortgages" means each of the Mortgages, except for the Calder
Mortgage, but if the Calder Mortgage is subsequently recorded in accordance with
Section 6.21, Recorded Mortgage shall include such Calder Mortgage on and after
the date of such recordation.

“Refinanced Indebtedness” means the Indebtedness and all other monetary
obligations under the Borrower’s “Term Notes” as defined in the Previous Credit
Agreement.

"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.

"Regulation U" means Regulation U, T, G or X of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.

"Reimbursement Obligations" means, at any time, the aggregate of all obligations
of the Borrower then outstanding under Section 2.3 to reimburse the LC Issuer
for amounts paid by the LC Issuer in respect of any one or more drawings under
Facility LCs.

"Rentals" of a Person means the aggregate fixed amounts payable by such Person
under any Operating Lease but shall not include Master Plan Bond Rentals or Tote
Rentals or rental or lease payments for the lease of Louisiana Downs or some
other facility for the conduct of the Fair Grounds winter 2005-2006 meet.

"Reportable Event" means a reportable event as defined in Section 4043 of ERISA
and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.

"Reports" is defined in Section 9.6.

"Required Lenders" means Lenders in the aggregate having at least fifty-one
percent (51%) of the Aggregate Outstanding Credit Exposure, or if the Aggregate
Commitment has been terminated, Lenders in the aggregate holding at least
fifty-one percent (51%) of the aggregate principal amount of all of the Loans
plus all of the LC Obligations.

"Reserve Requirement" means, with respect to an Interest Period, the maximum
aggregate reserve requirement (including all basic, supplemental, marginal and
other reserves) which is imposed under Regulation D on Eurocurrency liabilities.

"Restricted Assets" has the meaning given it in Section 6.13.

"Revolving Loan" means, with respect to a Lender, such Lender's Loan made
pursuant to its Commitment to lend set forth in Section 2.1 (or any conversion
or continuation thereof) and includes any “Revolving Loan” made pursuant to the
Previous Credit Agreement and outstanding on the Closing Date.

"Risk-Based Capital Guidelines" has the meaning given it in Section 3.2
 
"S&P" means Standard and Poor's Ratings Services, a division of The McGraw Hill
Companies, Inc.

"Sale and Leaseback Transaction" means any sale or other transfer of Property by
any Person with the intent to lease such Property as lessee.

"Schedule" refers to a specific schedule to this Agreement, unless another
document is specifically referenced.

“SEC” means the Securities and Exchange Commission, or any governmental
authority succeeding to any of its principal functions.

"Section" means a numbered section of this Agreement, unless another document is
specifically referenced.

"Secured Obligations" means, collectively, (i) all Obligations, (ii) all Rate
Management Obligations owing to one or more Lenders or any affiliate of any
Lender, and (iii) any and all other indebtedness and/or obligations to or for
the benefit of the Agent and/or one or more Lenders and/or the LC Issuer secured
by and/or in all or any of the Collateral Documents, in each case whether they
exist on the date of this Agreement, or arise or are created or acquired after
the date of this Agreement.

"Single Employer Plan" means a Plan maintained by the Borrower or any member of
the Controlled Group for employees of the Borrower or any member of the
Controlled Group.

"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its direct or indirect Subsidiaries or by such Person and one or more of its
direct or indirect Subsidiaries, or (ii) any partnership, limited liability
company, association, joint venture or similar business organization more than
50% of the ownership interests having ordinary voting power of which shall at
the time be so owned or controlled. Unless otherwise expressly provided, all
references herein to a "Subsidiary" shall mean a Subsidiary of the Borrower.

"Swing Line Borrowing Notice" is defined in Section 2.2.2.

"Swing Line Commitment" means the obligation of the Swing Line Lender in Section
2.2 to make Swing Line Loans up to a maximum principal amount of $15,000,000.

"Swing Line Lender" means PNC Bank, or such other Lender which may succeed to
its rights and obligations as Swing Line Lender pursuant to the terms of this
Agreement.

"Swing Line Loan" means a Loan made available to the Borrower by the Swing Line
Lender pursuant to Section 2.2.3 and includes any “Swing Line Loan” made
pursuant to the Previous Credit Agreement and outstanding on the Closing Date.

"Taxes" means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and any and all liabilities with respect to
the foregoing, but excluding Excluded Taxes and Other Taxes.

"Term Substantial Portion" means, with respect to the Property of the Borrower
and the other Loan Parties, collectively, Property which represents 20% or more
of Consolidated Net Worth or Property which is responsible for 20% of the
Consolidated Net Income, in each case, as would be shown in the consolidated
financial statements of the Loan Parties as at the end of the fiscal month next
preceding the Closing Date (or if financial statements have not been delivered
hereunder for that month, then the financial statements delivered hereunder for
the quarter ending immediately prior to that month). For purposes of determining
Term Substantial Portion of the Property of the Borrower and the other Loan
Parties, the value of any Property of Ellis Park Race Course, Inc. and/or Racing
Corporation of America sold, transferred or otherwise disposed of in connection
with the sale, transfer or other disposition of Ellis Park Race Course, Inc. or
Racing Corporation of America in compliance with this Agreement shall not be
considered.

"Title Insurer" is defined in Section 4.1.

"Tote Rentals" means all amounts paid by a Person for rental of equipment and/or
the provision of services under any agreement between such Person and a
totalisator company.

"Transferee" is defined in Section 12.4.

"Twelve Month Substantial Portion" means, with respect to the Property of the
Borrower and the other Loan Parties, collectively, Property which represents 10%
or more of Consolidated Net Worth or Property which is responsible for 10% of
the Consolidated Net Income, in each case, as would be shown in the consolidated
financial statements of the Loan Parties as at the beginning of the twelve-month
period ending with the month in which such determination is made (or if
financial statements have not been delivered hereunder for that month which
begins the twelve-month period, then the financial statements delivered
hereunder for the quarter ending immediately prior to that month). For purposes
of determining Twelve Month Substantial Portion of the Property of the Borrower
and the other Loan Parties, the value of any Property of Ellis Park Race Course,
Inc., and/or Racing Corporation of America sold, transferred or otherwise
disposed of in connection with the sale, transfer or other disposition of Ellis
Park Race Course, Inc. or Racing Corporation of America, in compliance with this
Agreement shall not be considered.

“2004B Amendment” means the 2004B Amendment to Loan Documents, dated as of
October 14, 2004, among the Agent, the Guarantors party thereto and the
Borrower.

“2004B Amendment to Pledge and Security Agreement” means the 2004B Amendment to
Pledge and Security Agreement, dated as of October 14, 2004, among the
applicable Loan Parties and the Collateral Agent, as they may be amended and/or
supplemented from time to time.

“2004B Assignments of Patent, Trademarks and Copyrights” shall mean the
Assignment of Patent, Trademarks and Copyrights, dated as of October 14, 2004,
executed by CDIP, L.L.C. in favor of the Collateral Agent and the Assignment of
Patent, Trademarks and Copyrights, dated as of October 14, 2004, executed by
Churchill Downs Louisiana Horseracing Company, L.L.C. in favor of the Collateral
Agent.

“2004B Collateral Documents” means, collectively, all of the instruments,
documents and agreements by which any Person grants a security interest in any
Collateral pursuant to the 2004B Amendment, including without limitation, those
documents referenced in Sections 6.25 and 6.29 of this Agreement, which in turn
includes without limitation, the 2004B Amendment to the Pledge and Security
Agreement, the 2004B Louisiana Addendum to Pledge and Security Agreement (as
defined in the 2004B Amendment to Pledge and Security Agreement), the 2004B
Consent Joinder and Reaffirmation, the Louisiana Mortgages, the 2004B
Assignments of Patents, Trademarks and Copyrights, the Fair Grounds Assignment
and Subordination of Lease and Management Agreement, the Jazz Fest Subordination
Agreement and Estoppel, and all other documents or instruments executed as
security for the Secured Obligations in connection with the 2004B Amendment from
time to time, as they may be amended and/or supplemented from time to time.

“2004B Consent Joinder and Reaffirmation” shall mean the Consent Joinder and
Reaffirmation, dated October 14, 2004, among the Collateral Agent, the Borrower
and the Guarantors party thereto.

“2004B Guarantor Joinder” shall mean the Guarantor Joinder, dated October 14,
2004, among the Collateral Agent, the Borrower and the Guarantors party thereto.

"Type" means, with respect to any Advance, its nature as a Floating Rate Advance
or a Eurodollar Advance and with respect to any Loan, its nature as a Floating
Rate Loan or a Eurodollar Loan.

"Unfunded Liabilities" means the amount (if any) by which the present value of
all vested and unvested accrued benefits under all Single Employer Plans exceeds
the fair market value of all such Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plans using PBGC
actuarial assumptions for single employer plan terminations.

"Unmatured Default" means an event which but for the lapse of time or the giving
of notice, or both, would constitute a Default.

“Wagerco” means an entity or entities existing or to be formed to consolidate
racing signals, wagering rights, account wagering and related businesses of the
Borrower and its Subsidiaries and third parties.

"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (ii) any partnership, limited liability company, association,
joint venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled.

"Working Cash Sweep Rider" is defined in Section 2.2.5.

The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms.

1.2  Amendment and Restatement of Previous Credit Agreement. The parties to this
Agreement agree that, upon (i) the execution and delivery by each of the parties
hereto of this Agreement and (ii) satisfaction of the conditions set forth in
Sections 4.1 and 4.2, the terms and provisions of the Previous Credit Agreement
shall be and hereby are amended, superseded and restated in their entirety by
the terms and provisions of this Agreement. This Agreement is not intended to
and shall not constitute a novation. All Loans made and Secured Obligations
incurred under the Previous Credit Agreement which are outstanding on the
Closing Date shall continue as Loans and Secured Obligations under (and shall be
governed by the terms of) this Agreement. Without limiting the foregoing, upon
the effectiveness hereof: (a) all Letters of Credit issued (or deemed issued)
under the Previous Credit Agreement which remain outstanding on the Closing Date
shall continue as Facility LCs under (and shall be governed by the terms of)
this Agreement, (b) all Secured Obligations constituting Rate Management
Obligations with any Lender or any Affiliate of any Lender which are outstanding
on the Closing Date shall continue as Secured Obligations under this Agreement
and the other Loan Documents, (c) the Agent shall make such reallocations of
each Lender’s “Outstanding Credit Exposure” under the Previous Credit Agreement
as are necessary in order that each such Lender’s Outstanding Credit Exposure
hereunder reflects such Lender’s Pro Rata Share of the outstanding Aggregate
Outstanding Credit Exposure and (d) the Previous Revolving Loans (as defined in
Section 2.1) of each Departing Lender shall be repaid in full (accompanied by
any accrued and unpaid interest and fees thereon), each Departing Lender’s
“Commitment” under the Previous Credit Agreement shall be terminated and each
Departing Lender shall not be a Lender hereunder.
 

ARTICLE II

THE CREDITS

2.1  Revolving Loan Commitment. Prior to the Closing Date, revolving loans were
previously made to the Borrower under the Previous Credit Agreement which remain
outstanding as of the date of this Agreement (such outstanding revolving loans
being hereinafter referred to as the “Previous Revolving Loans”). Subject to the
terms and conditions set forth in this Agreement, the Borrower and each of the
Lenders agree that on the Closing Date but subject to the satisfaction of the
conditions precedent set forth in Section 4.1 and 4.2 (as applicable), the
Previous Revolving Loans shall be reevidenced as Revolving Loans under this
Agreement, the terms of the Previous Revolving Loans shall be restated in their
entirety and shall be evidenced by this Agreement. From and including the date
of this Agreement and prior to the Facility Termination Date, each Lender
severally agrees, on the terms and conditions set forth in this Agreement, to
make Loans to the Borrower from time to time in amounts not to exceed in the
aggregate at any one time outstanding the amount of its Commitment. On the date
of this Agreement, the amount of the Aggregate Commitment is $200,000,000.
Subject to the terms of this Agreement, the Borrower may borrow, repay and
reborrow at any time prior to the Facility Termination Date. The Commitments to
lend hereunder shall expire on the Facility Termination Date. The Aggregate
Commitment may be increased up to a total of $250,000,000 upon compliance with
Section 2.22 below. No Lender shall have any obligation to increase its
Commitment; any such increase shall be at the sole discretion of such Lender.
 
2.2  Swing Line Loans.
 
2.2.1  Amount of Swing Line Loans. Upon the satisfaction of the conditions
precedent set forth in Section 4.2 and, if such Swing Line Loan is to be made on
the date of the initial Advance hereunder, the satisfaction of the conditions
precedent set forth in Section 4.1 as well, from and including the date of this
Agreement and prior to the Facility Termination Date, the Swing Line Lender
agrees, on the terms and conditions set forth in this Agreement, to make Swing
Line Loans to the Borrower from time to time in an aggregate principal amount
not to exceed the Swing Line Commitment, provided that the Aggregate Outstanding
Credit Exposure (including without limitation Swing Line Loans) shall not at any
time exceed the Aggregate Commitment, and provided further that at no time shall
the sum of (i) the Swing Line Lender's Pro Rata Share of the Swing Line Loans,
plus (ii) the outstanding Revolving Loans made by the Swing Line Lender pursuant
to Section 2.1, exceed the Swing Line Lender's Commitment at such time. Subject
to the terms of this Agreement, the Borrower may borrow, repay and reborrow
Swing Line Loans at any time prior to the Facility Termination Date.
 
2.2.2  Borrowing Notice. The Borrower shall deliver to the Agent and the Swing
Line Lender irrevocable notice (a "Swing Line Borrowing Notice") not later than
noon (Louisville time) on the Borrowing Date of each Swing Line Loan, specifying
(i) the applicable Borrowing Date (which date shall be a Business Day), and (ii)
the aggregate amount of the requested Swing Line Loan which shall be an amount
not less than $100,000. The Swing Line Loans shall bear interest at a rate per
annum equal to the prime rate of interest announced by the Swing Line Lender
from time to time, plus the Applicable Margin set forth in the Pricing Schedule
for the Floating Rate at that time.
 
2.2.3  Making of Swing Line Loans. Promptly after receipt of a Swing Line
Borrowing Notice, the Agent shall notify each Lender by fax, or other similar
form of transmission, of the requested Swing Line Loan. Not later than 2:00 p.m.
(Louisville time) on the applicable Borrowing Date, the Swing Line Lender shall
make available the Swing Line Loan, in funds immediately available in
Louisville, to the Agent at its address specified pursuant to Article XIII. The
Agent will promptly make the funds so received from the Swing Line Lender
available to the Borrower on the Borrowing Date at the Agent's aforesaid
address.
 
2.2.4  Repayment of Swing Line Loans. Each Swing Line Loan shall be paid in full
by the Borrower on or before the fifth (5th) Business Day after the Borrowing
Date for such Swing Line Loan. In addition, the Swing Line Lender (i) may at any
time in its sole discretion with respect to any outstanding Swing Line Loan, or
(ii) shall, except when a Working Cash Sweep Rider is in effect, on the fifth
(5th) Business Day after the Borrowing Date of any Swing Line Loan, require each
Lender (including the Swing Line Lender) to make a Revolving Loan in the amount
of such Lender's Pro Rata Share of such Swing Line Loan (including, without
limitation, any interest accrued and unpaid thereon), for the purpose of
repaying such Swing Line Loan. Not later than noon (Louisville time) on the date
of any notice received pursuant to this Section 2.2.4, each Lender shall make
available its required Revolving Loan, in funds immediately available in
Louisville to the Agent at its address specified pursuant to Article XIII.
Revolving Loans made pursuant to this Section 2.2.4 shall initially be Floating
Rate Loans and thereafter may be continued as Floating Rate Loans or converted
into Eurodollar Loans in the manner provided in Section 2.11 and subject to the
other conditions and limitations set forth in this Article II. Unless a Lender
shall have notified the Swing Line Lender, prior to its making any Swing Line
Loan, that any applicable condition precedent set forth in Sections 4.1 or 4.2
had not then been satisfied, such Lender's obligation to make Revolving Loans
pursuant to this Section 2.2.4 to repay Swing Line Loans shall be unconditional,
continuing, irrevocable and absolute and shall not be affected by any
circumstance, including, without limitation, (a) any setoff, counterclaim,
recoupment, defense or other right which such Lender may have against the Agent,
the Swing Line Lender or any other Person, (b) the occurrence or continuance of
a Default or Unmatured Default, (c) any adverse change in the condition
(financial or otherwise) of the Borrower, or (d) any other circumstance,
happening or event whatsoever. In the event that any Lender fails to make
payment to the Agent of any amount due under this Section 2.2.4, the Agent shall
be entitled to receive, retain and apply against such obligation the principal
and interest otherwise payable to such Lender hereunder until the Agent receives
such payment from such Lender or such obligation is otherwise fully satisfied.
In addition to the foregoing, if for any reason any Lender fails to make payment
to the Agent of any amount due under this Section 2.2.4, such Lender shall be
deemed, at the option of the Agent, to have unconditionally and irrevocably
purchased from the Swing Line Lender, without recourse or warranty, an undivided
interest and participation in the applicable Swing Line Loan in the amount of
such Revolving Loan, and such interest and participation may be recovered from
such Lender together with interest thereon at the Federal Funds Effective Rate
for each day during the period commencing on the date of demand and ending on
the date such amount is received. On the Facility Termination Date, the Borrower
shall repay in full the outstanding principal balance of the Swing Line Loans.
 
2.2.5 Working Cash Sweep Rider. Any provision of this Section 2.2 to the
contrary notwithstanding, the Agent and each Lender acknowledges that, at the
request of the Borrower, the Swing Line Lender has linked the Swing Line Loans
to the Borrower’s demand deposit account with the Swing Line Lender. The Agent
and the Lenders further acknowledge that the Borrower has entered into a Working
Cash, Line of Credit, Investment Sweep Rider (“Working Cash Sweep Rider”) with
the Swing Line Lender, pursuant to which certain cash management activities,
including the making of Swing Line Loans, will occur automatically in amounts
that may be less than the stated minimum Swing Line Loan set forth in Section
2.2.2 above, and without the need for a Swing Line Borrowing Notice. Each Lender
agrees that it shall be obligated, pursuant to and in accordance with Section
2.2.4, to fund such Lender’s Pro Rata Share of any such automatically-made Swing
Line Loans on the fifth (5th) Business Day following the day such advances are
made, unless the Agent shall have given the Swing Line Lender written notice
prior to the date the Swing Line Loan was made that any applicable condition
precedent set forth in Sections 4.1 or 4.2 had not then been satisfied, and the
Swing Line Lender has had a reasonable amount of time, not to exceed two (2)
Business Days from such notice, within which to act. In the event of termination
of the Working Cash Sweep Rider by either the Borrower or the Swing Line Lender,
the Swing Line Lender will promptly notify the Agent of such termination.

2.3  Letter of Credit Subfacility.
 
2.3.1  Issuance. The LC Issuer hereby agrees, on the terms and conditions set
forth in this Agreement, to issue standby and commercial letters of credit (each
such Letter of Credit, together with each Letter of Credit issued or deemed to
be issued pursuant to the Previous Credit Agreement and outstanding on the
Closing Date, a "Facility LC") and to renew, extend, increase, decrease or
otherwise modify each Facility LC ("Modify," and each such action a
"Modification"), from time to time from and including the date of this Agreement
and prior to the Facility Termination Date upon the request of the Borrower;
provided that immediately after each such Facility LC is issued or Modified, (i)
the aggregate amount of the outstanding LC Obligations shall not exceed
$25,000,000 and (ii) the Aggregate Outstanding Credit Exposure shall not exceed
the Aggregate Commitment. No Facility LC shall have an expiry date later than
the earlier of (x) the fifth Business Day prior to the Facility Termination Date
and (y) one year after its issuance; provided that any Facility LC with an
expiry date one year after issuance may provide for the renewal thereof for
additional one-year periods (which shall in no event extend beyond the date
referred to in clause (x) above).
 
2.3.2  Participations. Upon (a) the Closing Date with respect to each Facility
LC issued and outstanding under the Previous Credit Agreement and (b) the
issuance or Modification by the LC Issuer of each other Facility LC in
accordance with this Section 2.3, the LC Issuer shall be deemed, without further
action by any party hereto, to have unconditionally and irrevocably sold to each
Lender, and each Lender shall be deemed, without further action by any party
hereto, to have unconditionally and irrevocably purchased from the LC Issuer, a
participation in such Facility LC (and each Modification thereof) and the
related LC Obligations in proportion to its Pro Rata Share.
 
2.3.3  Notice. Subject to Section 2.3.1, the Borrower shall give the LC Issuer
and the Agent notice prior to 10:00 a.m. (Louisville time) at least three
Business Days, or such shorter period of time as may be acceptable to the LC
Issuer in its discretion, prior to the proposed date of issuance or Modification
of each Facility LC, specifying the beneficiary, the proposed date of issuance
(or Modification) and the expiry date of such Facility LC, and describing the
proposed terms of such Facility LC and the nature of the transactions proposed
to be supported thereby. Upon Agent’s receipt of such notice, the Agent shall
promptly notify the LC Issuer if the proposed amount of such Facility LC will
cause the Aggregate Outstanding Credit Exposure to equal or exceed the Aggregate
Commitment. The issuance or Modification by the LC Issuer of any Facility LC
shall, in addition to the conditions precedent set forth in Article IV (the
satisfaction of which the LC Issuer shall have no duty to ascertain), be subject
to the conditions precedent that such Facility LC shall be satisfactory to the
LC Issuer and that the Borrower shall have executed and delivered a
Reimbursement Agreement (“LC Reimbursement Agreement”) in the form of Exhibit Q,
and such application agreement and/or such other instruments and agreements
relating to such Facility LC as the LC Issuer shall have reasonably requested
(each, a "Facility LC Application"). The terms of the LC Reimbursement Agreement
and Facility LC Application shall supplement the terms of this Agreement, but in
the event of any conflict between the terms of this Agreement and the terms of
any LC Reimbursement Agreement and/or any Facility LC Application, the terms of
this Agreement shall control. On the date of issuance or Modification by the LC
Issuer of any Facility LC, the LC Issuer shall notify the Agent, and the Agent
shall promptly notify each Lender of the issuance or Modification of each
Facility LC, specifying the beneficiary, the date of issuance (or Modification)
and the expiry date of such Facility LC, the terms of the Facility LC and the
nature of the transactions supported by the Facility LC.
 
2.3.4  LC Fees. The Borrower shall pay to the Agent, for the account of the
Lenders ratably in accordance with their respective Pro Rata Shares, with
respect to each Facility LC, a letter of credit fee at a per annum rate equal to
the Applicable Margin for Eurodollar Loans in effect from time to time on the
average daily undrawn stated amount under such Facility LC, such fee to be
payable in arrears on each Payment Date, and such fee to be payable on the date
of such issuance or increase (each such fee described in this sentence an "LC
Fee"). In addition, the Borrower shall pay to the LC Issuer for its own account
a fronting fee equal to 12.5 basis points (0.125%) multiplied by the daily
average Letters of Credit Outstanding, payable quarterly in arrears commencing
on the first Business Day of each October, January, April and July following
issuance of each Facility LC and on the Facility Termination Date. As used
herein, “Letters of Credit Outstanding” means the aggregate amount available to
be drawn on all Facility LCs issued and outstanding (including any amounts drawn
thereunder and not reimbursed, regardless of the existence or satisfaction of
any conditions or limitations on drawing).
 
2.3.5  Administration; Reimbursement by Lenders. Upon receipt from the
beneficiary of any Facility LC of any demand for payment in connection with a
presentation of documents under such Facility LC, the LC Issuer shall notify the
Agent and the Agent shall promptly notify the Borrower and each other Lender as
to the amount to be paid by the LC Issuer as a result of such demand and the
proposed payment date (the "LC Payment Date"). The responsibility of the LC
Issuer to the Borrower and each Lender shall be only to determine that the
documents (including each demand for payment) delivered under each Facility LC
in connection with such presentment shall be in conformity in all material
respects with such Facility LC. The LC Issuer shall endeavor to exercise the
same care in the issuance and administration of the Facility LCs as it does with
respect to letters of credit in which no participations are granted, it being
understood that in the absence of any gross negligence or willful misconduct by
the LC Issuer, each Lender shall be unconditionally and irrevocably liable
without regard to the occurrence of any Default or any condition precedent
whatsoever, to reimburse the LC Issuer on demand for (i) such Lender's Pro Rata
Share of the amount of each payment made by the LC Issuer under each Facility LC
to the extent such amount is not reimbursed by the Borrower pursuant to Section
2.3.6 below, plus (ii) interest on the foregoing amount to be reimbursed by such
Lender, for each day from the date of the LC Issuer's demand for such
reimbursement (or, if such demand is made after 11:00 a.m. (Louisville time) on
such date, from the next succeeding Business Day) to the date on which such
Lender pays the amount to be reimbursed by it, at a rate of interest per annum
equal to the Federal Funds Effective Rate for the first three days and,
thereafter, at a rate of interest equal to the rate applicable to Floating Rate
Advances.
 
2.3.6  Reimbursement by Borrower. The Borrower shall be irrevocably and
unconditionally obligated to reimburse the LC Issuer on or before the applicable
LC Payment Date for any amounts to be paid by the LC Issuer upon any drawing
under any Facility LC, without presentment, demand, protest or other formalities
of any kind; provided that neither the Borrower nor any Lender shall hereby be
precluded from asserting any claim for direct (but not consequential) damages
suffered by the Borrower or such Lender to the extent, but only to the extent,
caused by the willful misconduct or gross negligence of the LC Issuer in
determining whether a request presented under any Facility LC issued by it
complied with the terms of such Facility LC. All such amounts paid by the LC
Issuer and remaining unpaid by the Borrower shall bear interest, payable on
demand, for each day until paid at a rate per annum equal to (x) the rate
applicable to Floating Rate Advances for such day if such day falls on or before
the applicable LC Payment Date and (y) the sum of 2% plus the rate applicable to
Floating Rate Advances for such day if such day falls after such LC Payment
Date. The LC Issuer will pay to each Lender ratably in accordance with its Pro
Rata Share all amounts received by it from the Borrower for application in
payment, in whole or in part, of the Reimbursement Obligation in respect of any
Facility LC issued by the LC Issuer, but only to the extent such Lender has made
payment to the LC Issuer in respect of such Facility LC pursuant to Section
2.3.5. Subject to the terms and conditions of this Agreement (including without
limitation the submission of a Borrowing Notice in compliance with Section 2.10
and the satisfaction of the applicable conditions precedent set forth in Article
IV), the Borrower may request an Advance hereunder for the purpose of satisfying
any Reimbursement Obligation.
 
2.3.7  Obligations Absolute. The Borrower's obligations under this Section 2.3
shall be absolute and unconditional under any and all circumstances and
irrespective of any setoff, counterclaim or defense to payment which the
Borrower may have or have had against the LC Issuer, any Lender or any
beneficiary of a Facility LC. The Borrower further agrees with the LC Issuer and
the Lenders that the LC Issuer and the Lenders shall not be responsible for, and
the Borrower's Reimbursement Obligation in respect of any Facility LC shall not
be affected by, among other things, the validity or genuineness of documents or
of any endorsements thereon, even if such documents should in fact prove to be
in any or all respects invalid, fraudulent or forged, or any dispute between or
among the Borrower, any of its Affiliates, the beneficiary of any Facility LC or
any financing institution or other party to whom any Facility LC may be
transferred or any claims or defenses whatsoever of the Borrower or of any of
its Affiliates against the beneficiary of any Facility LC or any such
transferee. The LC Issuer shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Facility LC. The Borrower
agrees that any action taken or omitted by the LC Issuer or any Lender under or
in connection with each Facility LC and the related drafts and documents, if
done without gross negligence or willful misconduct, shall be binding upon the
Borrower and shall not put the LC Issuer or any Lender under any liability to
the Borrower. Nothing in this Section 2.3.7 is intended to limit the right of
the Borrower to make a claim against the LC Issuer for damages as contemplated
by the proviso to the first sentence of Section 2.3.6.
 
2.3.8  Actions of LC Issuer. The LC Issuer shall be entitled to rely, and shall
be fully protected in relying, upon any Facility LC, draft, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document believed by it to
be genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by the LC Issuer. The LC Issuer shall be
fully justified in failing or refusing to take any action under this Agreement
unless it shall first have received such advice or concurrence of the Required
Lenders as it reasonably deems appropriate or it shall first be indemnified to
its reasonable satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. Notwithstanding any other provision of this Section 2.3, the LC
Issuer shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement in accordance with a request of the Required
Lenders, and such request and any action taken or failure to act pursuant
thereto shall be binding upon the Lenders and any future holders of a
participation in any Facility LC.
 
2.3.9  Indemnification. The Borrower hereby agrees to indemnify and hold
harmless each Lender, the LC Issuer and the Agent, and their respective
directors, officers, agents and employees from and against any and all claims
and damages, losses, liabilities, costs or expenses which such Lender, the LC
Issuer or the Agent may incur (or which may be claimed against such Lender, the
LC Issuer or the Agent by any Person whatsoever) by reason of or in connection
with the issuance, execution and delivery or transfer of or payment or failure
to pay under any Facility LC or any actual or proposed use of any Facility LC,
including, without limitation, any claims, damages, losses, liabilities, costs
or expenses which the LC Issuer may incur by reason of or in connection with
(i) the failure of any other Lender to fulfill or comply with its obligations to
the LC Issuer hereunder (but nothing herein contained shall affect any rights
the Borrower may have against any defaulting Lender) or (ii) by reason of or on
account of the LC Issuer issuing any Facility LC which specifies that the term
"Beneficiary" included therein includes any successor by operation of law of the
named Beneficiary, but which Facility LC does not require that any drawing by
any such successor Beneficiary be accompanied by a copy of a legal document,
satisfactory to the LC Issuer, evidencing the appointment of such successor
Beneficiary; provided that the Borrower shall not be required to indemnify any
Lender, the LC Issuer or the Agent for any claims, damages, losses, liabilities,
costs or expenses to the extent, but only to the extent, caused by the willful
misconduct or gross negligence of the LC Issuer in determining whether a request
presented under any Facility LC complied with the terms of such Facility LC.
Nothing in this Section 2.3.9 is intended to limit the obligations of the
Borrower under any other provision of this Agreement.
 
2.3.10  Lenders' Indemnification. Each Lender shall, ratably in accordance with
its Pro Rata Share, indemnify the LC Issuer, its affiliates and their respective
directors, officers, agents and employees (to the extent not reimbursed by the
Borrower) against any cost, expense (including reasonable counsel fees and
disbursements), claim, demand, action, loss or liability (except such as result
from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Section 2.3 or any
action taken or omitted by such indemnitees hereunder.
 
2.3.11  Facility LC Collateral Account. The Borrower agrees that it will, upon
the request of the Agent or the Required Lenders and until the final expiration
date of any Facility LC and thereafter as long as any amount is payable to the
LC Issuer or the Lenders in respect of any Facility LC, maintain a special
collateral account pursuant to arrangements satisfactory to the Agent (the
"Facility LC Collateral Account") at the Agent's office at the address specified
pursuant to Article XIII, in the name of the Borrower but under the sole
dominion and control of the Agent, for the benefit of the Lenders and the LC
Issuer and in which the Borrower shall have no interest other than as set forth
in Section 8.1. The Borrower hereby pledges, assigns and grants to the Agent, on
behalf of and for the ratable benefit of the Lenders, and the LC Issuer, a
security interest in all of the Borrower's right, title and interest in and to
all funds which may from time to time be on deposit in the Facility LC
Collateral Account to secure the prompt and complete payment and performance of
the Obligations. The Agent will invest any funds on deposit from time to time in
the Facility LC Collateral Account in certificates of deposit of JPMorgan having
a maturity not exceeding 30 days. Nothing in this Section 2.3.11 shall either
obligate the Agent to require the Borrower to deposit any funds in the Facility
LC Collateral Account or limit the right of the Agent to release any funds held
in the Facility LC Collateral Account in each case other than as required by
Section 8.1.
 
2.3.12  Rights as a Lender. In its capacity as a Lender, the LC Issuer shall
have the same rights and obligations as any other Lender.
 
2.4  Required Payments; Termination. Any outstanding Advances and all other
unpaid Obligations shall be paid in full by the Borrower on the Facility
Termination Date.
 
2.5  Ratable Loans. Each Advance hereunder shall consist of Loans made from the
several Lenders ratably according to their Pro Rata Shares.
 
2.6  Types and Number of Eurodollar Advances. The Advances may be Floating Rate
Advances or Eurodollar Advances, or a combination thereof, selected by the
Borrower in accordance with Sections 2.10 and 2.11, or Swing Line Loans selected
by Borrower in accordance with Section 2.2. The Borrower may have no more than
six (6) Eurodollar Advances outstanding at any one time.
 
2.7  Commitment Fee; Reductions in Aggregate Commitment. The Borrower agrees to
pay to the Agent for the account of each Lender according to its Pro Rata Share
a commitment fee (the "Commitment Fee") in arrears at a per annum rate equal to
the Applicable Fee Rate in effect from time to time on the average daily
Available Aggregate Commitment of such Lender from the date hereof to and
including the Facility Termination Date, payable on each Payment Date hereafter
and on the Facility Termination Date. Swing Line Loans shall not count as usage
of any Lender's Commitment for the purpose of calculating the commitment fee due
hereunder. In addition, on the Closing Date, the Borrower shall pay to the Agent
for the ratable account of the lenders then party to the Previous Credit
Agreement, the accrued and unpaid commitment fees under the Previous Credit
Agreement through Closing Date. The Borrower may permanently reduce the
Aggregate Commitment in whole, or in part ratably among the Lenders in integral
multiples of $5,000,000, upon at least one Business Days' written notice to the
Agent, which notice shall specify the amount of any such reduction, provided,
however, that the amount of the Aggregate Commitment may not be reduced below
the Aggregate Outstanding Credit Exposure. All accrued Commitment Fees shall be
payable on the effective date of any termination of the obligations of the
Lenders to make Credit Extensions hereunder.
 
2.8  Minimum Amount of Each Advance. Each Eurodollar Advance shall be in the
minimum amount of $500,000 (and in multiples of $100,000 if in excess thereof),
and each Floating Rate Advance (other than an advance to repay Swing Line Loans)
shall be in the minimum amount of $500,000 (and in multiples of $100,000 if in
excess thereof), provided, however, that any Floating Rate Advance may be in the
amount of the Available Aggregate Commitment.
 
2.9  Optional Principal Payments. The Borrower may from time to time pay,
without penalty or premium, all outstanding Floating Rate Advances (other than
Swing Line Loans), or, in a minimum aggregate amount of $1,000,000 or any
integral multiple of $1,000,000 in excess thereof, any portion of the
outstanding Floating Rate Advances (other than Swing Line Loans) upon one
Business Day's prior notice to the Agent. The Borrower may at any time pay,
without penalty or premium, all outstanding Swing Line Loans, or, in a minimum
amount of $100,000 and increments of $50,000 in excess thereof, any portion of
the outstanding Swing Line Loans, with notice to the Agent and the Swing Line
Lender by 11:00 a.m. (Louisville Time) on the date of repayment. The Borrower
may from time to time pay, subject to the payment of any funding indemnification
amounts required by Section 3.4 but without penalty or premium, all outstanding
Eurodollar Advances or any portion of the outstanding Eurodollar Advances upon
three (3) Business Days' prior notice to the Agent.
 
2.10  Method of Selecting Types and Interest Periods for New Advances. Each Type
of Advance shall bear interest according to its Type, from the date the Advance
is made until it is repaid. The Borrower shall select the Type of Advance and,
in the case of each Eurodollar Advance, the Interest Period applicable thereto
from time to time. The Borrower shall give the Agent irrevocable notice (a
"Borrowing Notice") not later than 11:00 a.m. (Louisville time) at least one
Business Day before the Borrowing Date of each Floating Rate Advance and three
Business Days before the Borrowing Date for each Eurodollar Advance, specifying:
 
(i)  the Borrowing Date, which shall be a Business Day, of such Advance,

(ii)  the aggregate amount of such Advance,

(iii)  the Type of Advance selected, and

(iv)  in the case of each Eurodollar Advance, the Interest Period applicable
thereto.

Not later than 1:00 p.m. (Louisville time) on each Borrowing Date, each Lender
shall make available its Loan or Loans in funds immediately available in
Louisville to the Agent at its address specified pursuant to Article XIII. The
Agent will make the funds so received from the Lenders available to the Borrower
at the Agent's aforesaid address.

2.11  Conversion and Continuation of Outstanding Advances. Floating Rate
Advances (other than Swing Line Loans) shall continue as Floating Rate Advances
unless and until such Floating Rate Advances are converted into Eurodollar
Advances pursuant to this Section 2.11 or are repaid in accordance with Section
2.9. Each Eurodollar Advance shall continue as a Eurodollar Advance until the
end of the then applicable Interest Period therefor, at which time such
Eurodollar Advance shall be automatically converted into a Floating Rate Advance
unless (x) such Eurodollar Advance is or was repaid in accordance with Section
2.9 or (y) the Borrower shall have given the Agent a Conversion/Continuation
Notice (as defined below) requesting that, at the end of such Interest Period,
such Eurodollar Advance continue as a Eurodollar Advance for the same or another
Interest Period. Subject to the terms of Section 2.10, the Borrower may elect
from time to time to convert all or any part of a Floating Rate Advance (other
than a Swing Line Loan) into a Eurodollar Advance. The Borrower shall give the
Agent irrevocable notice (a "Conversion/Continuation Notice") of each conversion
of a Floating Rate Advance into a Eurodollar Advance or continuation of a
Eurodollar Advance not later than 11:00 a.m. (Louisville time) at least three
Business Days prior to the date of the requested conversion or continuation,
specifying:

(i)  the requested date, which shall be a Business Day, of such conversion or
continuation,

(ii)  the aggregate amount and Type of the Advance which is to be converted or
continued, and

(iii)  the amount of such Advance which is to be converted into or continued as
a Eurodollar Advance and the duration of the Interest Period applicable thereto.

2.12  Changes in Interest Rate, etc. Each Floating Rate Advance (other than a
Swing Line Loan) shall bear interest on the outstanding principal amount
thereof, for each day from and including the date such Advance is made or is
automatically converted from a Eurodollar Advance into a Floating Rate Advance
pursuant to Section 2.11, to but excluding the date it is paid or is converted
into a Eurodollar Advance pursuant to Section 2.11 hereof, at a rate per annum
equal to the Floating Rate for such day. Each Swing Line Loan shall bear
interest on the outstanding principal amount thereof, for each day from and
including the day such Swing Line Loan is made to but excluding the date it is
paid, at a rate per annum equal to the Floating Rate for such day. Changes in
the rate of interest on that portion of any Advance maintained as a Floating
Rate Advance will take effect simultaneously with each change in the Alternate
Base Rate. Each Eurodollar Advance shall bear interest on the outstanding
principal amount thereof from and including the first day of the Interest Period
applicable thereto to (but not including) the last day of such Interest Period
at the interest rate determined by the Agent as applicable to such Eurodollar
Advance based upon the Borrower's selections under Sections 2.10 and 2.11 and
otherwise in accordance with the terms hereof. No Interest Period may end after
the Facility Termination Date.
 
2.13  Rates Applicable After Default. Notwithstanding anything to the contrary
contained in Section 2.10, 2.11 or 2.12, during the continuance of a Default or
Unmatured Default the Required Lenders may, at their option, by notice to the
Borrower (which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that no Advance may be made as,
converted into or continued as a Eurodollar Advance. During the continuance of a
Default the Required Lenders may, at their option, by notice to the Borrower
(which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that (i) each Eurodollar Advance
shall bear interest for the remainder of the applicable Interest Period at the
rate otherwise applicable to such Interest Period plus 2% per annum, and (ii)
each Floating Rate Advance shall bear interest at a rate per annum equal to the
Floating Rate in effect from time to time plus 2% per annum and (iii) the LC Fee
shall be increased by 2% per annum, provided that, during the continuance of a
Default under Section 7.6 or 7.7, the interest rates set forth in clauses (i)
and (ii) above and the increase in the LC Fee set forth in clause (iii) above
shall be applicable to all Credit Extensions without any election or action on
the part of the Agent or any Lender.
 
2.14  Method of Payment. All payments of the Obligations hereunder shall be
made, without setoff, deduction, or counterclaim, in immediately available funds
to the Agent at the Agent's address specified pursuant to Article XIII, or at
any other Lending Installation of the Agent specified in writing by the Agent to
the Borrower, by noon (local time) on the date when due and shall (except with
respect to repayments of Swing Line Loans, and in the case of Reimbursement
Obligations for which the LC Issuer has not been fully indemnified by the
Lenders, or as otherwise specifically required hereunder) be applied ratably by
the Agent among the Lenders. Each payment delivered to the Agent for the account
of any Lender shall be delivered promptly by the Agent to such Lender, in the
same type of funds that the Agent received, at such Lender's address specified
pursuant to Article XIII or at any Lending Installation specified in a notice
received by the Agent from such Lender. The Agent is hereby authorized to charge
the account of the Borrower maintained with JPMorgan for each payment of
principal, interest Reimbursement Obligations and fees as it becomes due
hereunder. Each reference to the Agent in this Section 2.14 shall also be deemed
to refer, and shall apply equally, to the LC Issuer, in the case of payments
required to be made by the Borrower to the LC Issuer pursuant to Section 2.3.6.
 
2.15  Noteless Agreement; Evidence of Indebtedness.
 

(i)  
Each Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Loan made by such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.

 

(ii)  
The Agent shall also maintain accounts in which it will record (a) the amount of
each Loan made hereunder, the Type thereof and the Interest Period (if
applicable) with respect thereto, (b) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder, (c) the original stated amount of each Facility LC and the amount of
LC Obligations outstanding at any time, and (d) the amount of any sum received
by the Agent hereunder from the Borrower and each Lender's share thereof.

 

(iii)  
The entries maintained in the accounts maintained pursuant to paragraphs (i) and
(ii) above shall be prima facie evidence of the existence and amounts of the
Obligations therein recorded; provided, however, that the failure of the Agent
or any Lender to maintain such accounts or any error therein shall not in any
manner affect the obligation of the Borrower to repay the Obligations in
accordance with their terms.

 

(iv)  
Any Lender may request that its Loans be evidenced by a promissory note or, in
the case of the Swing Line Lender, promissory notes representing its Revolving
Loans and Swing Line Loans, respectively, substantially in the form of Exhibit
E, with appropriate changes for notes evidencing Swing Line Loans (each, a
"Note"). In such event, the Agent shall prepare and forward to the Borrower for
execution and delivery to such Lender a Note or Notes payable to the order of
such Lender. Thereafter, the Loans evidenced by each such Note and interest
thereon shall at all times (prior to any assignment pursuant to Section 12.3) be
represented by one or more Notes payable to the order of the payee named
therein, except to the extent that any such Lender subsequently returns any such
Note for cancellation and requests that such Loans once again be evidenced as
described in paragraphs (i) and (ii) above.

 
2.16  Telephonic Notices. The Borrower hereby authorizes the Lenders and the
Agent to extend, convert or continue Advances, effect selections of Types of
Advances and to transfer funds based on telephonic notices made by any person or
persons the Agent or any Lender in good faith believes to be acting on behalf of
the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation signed by an Authorized Officer, if such
confirmation is requested by the Agent or any Lender, of each telephonic notice.
If the written confirmation differs in any material respect from the action
taken by the Agent and the Lenders, the records of the Agent and the Lenders
shall govern absent manifest error.
 
2.17  Interest Payment Dates; Interest and Fee Basis. Interest accrued on each
Floating Rate Advance shall be payable on each Payment Date, commencing with the
first such date to occur after the date hereof, on each date set forth in the
Working Cash Sweep Rider, on any date on which the Floating Rate Advance is
prepaid, whether due to acceleration or otherwise, and on the Facility
Termination Date. Interest accrued on that portion of the outstanding principal
amount of any Floating Rate Advance converted into a Eurodollar Advance on a day
other than a Payment Date shall be payable on the date of conversion. Interest
accrued on each Eurodollar Advance shall be payable on the last day of its
applicable Interest Period, on any date on which the Eurodollar Advance is
prepaid, whether by acceleration or otherwise, and on the Facility Termination
Date. Interest accrued on each Eurodollar Advance having an Interest Period
longer than three months shall also be payable on the last day of each
three-month interval during such Interest Period. Interest, Commitment Fees and
LC Fees shall be calculated for actual days elapsed on the basis of a 360-day
year, except for interest payable on Advances at the Alternate Base Rate which
shall accrue on the basis of the actual number of days elapsed over a year of
365 or 366 days, as appropriate. Interest shall be payable for the day an
Advance is made but not for the day of any payment on the amount paid if payment
is received prior to noon (local time) at the place of payment. If any payment
of principal of or interest on an Advance shall become due on a day which is not
a Business Day, such payment shall be made on the next succeeding Business Day
and, in the case of a principal payment, such extension of time shall be
included in computing interest in connection with such payment.
 
2.18  Notification of Advances, Interest Rates, Prepayments and Commitment
Reductions. Promptly after receipt thereof, the Agent will notify each Lender of
the contents of each Aggregate Commitment reduction notice, Borrowing Notice,
Conversion/Continuation Notice, and repayment notice received by it hereunder.
Promptly after notice from the LC Issuer, the Agent will notify each Lender of
the contents of each request for issuance of a Facility LC hereunder. The Agent
will notify each Lender of the interest rate applicable to each Eurodollar
Advance promptly upon determination of such interest rate and will give each
Lender prompt notice of each change in the Alternate Base Rate.
 
2.19  Lending Installations. Each Lender may book its Loans and its
participation in any LC Obligations and the LC Issuer may book the Facility LCs
at any Lending Installation selected by such Lender or the LC Issuer, as the
case may be, and may change its Lending Installation from time to time. All
terms of this Agreement shall apply to any such Lending Installation and the
Loans, Facility LCs, participations in LC Obligations and any Notes issued
hereunder shall be deemed held by each Lender or the LC Issuer, as the case may
be, for the benefit of any such Lending Installation. Each Lender and the LC
Issuer may, by written notice to the Agent and the Borrower in accordance with
Article XIII, designate replacement or additional Lending Installations through
which Loans will be made by it or Facility LCs will be issued by it and for
whose account Loan payments or payments with respect to Facility LCs are to be
made.
 
2.20  Non-Receipt of Funds by the Agent. Unless the Borrower or a Lender, as the
case may be, notifies the Agent prior to the date on which it is scheduled to
make payment to the Agent of (i) in the case of a Lender, the proceeds of a Loan
or (ii) in the case of the Borrower, a payment of principal, interest or fees to
the Agent for the account of the Lenders, that it does not intend to make such
payment, the Agent may assume that such payment has been made. The Agent may,
but shall not be obligated to, make the amount of such payment available to the
intended recipient in reliance upon such assumption. If such Lender or the
Borrower, as the case may be, has not in fact made such payment to the Agent,
the recipient of such payment shall, on demand by the Agent, repay to the Agent
the amount so made available together with interest thereon in respect of each
day during the period commencing on the date such amount was so made available
by the Agent until the date the Agent recovers such amount at a rate per annum
equal to (x) in the case of payment by a Lender, the Federal Funds Effective
Rate for such day for the first three days and, thereafter, the interest rate
applicable to the relevant Loan or (y) in the case of payment by the Borrower,
the interest rate applicable to the relevant Loan.
 
2.21  Replacement of Lender. If the Borrower is required pursuant to Section
3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any Lender's
obligation to make or continue, or to convert Floating Rate Advances into,
Eurodollar Advances shall be suspended pursuant to Section 3.3 (any Lender so
affected an "Affected Lender"), the Borrower may elect, if such amounts continue
to be charged or such suspension is still effective, to replace such Affected
Lender as a Lender party to this Agreement, provided that no Default or
Unmatured Default shall have occurred and be continuing at the time of such
replacement, and provided further that, concurrently with such replacement, (i)
another bank or other entity which is reasonably satisfactory to the Borrower
and the Agent shall agree, as of such date, to purchase for cash the Advances
and other Obligations due to the Affected Lender pursuant to an assignment
substantially in the form of Exhibit C and to become a Lender for all purposes
under this Agreement and to assume all obligations of the Affected Lender to be
terminated as of such date and to comply with the requirements of Section 12.3
applicable to assignments, and (ii) the Borrower shall pay to such Affected
Lender in same day funds on the day of such replacement (A) all interest, fees
and other amounts then accrued but unpaid to such Affected Lender by the
Borrower hereunder to and including the date of termination, including without
limitation payments due to such Affected Lender under Sections 3.1, 3.2 and 3.5,
and (B) an amount, if any, equal to the payment which would have been due to
such Lender on the day of such replacement under Section 3.4 had the Loans of
such Affected Lender been prepaid on such date rather than sold to the
replacement Lender.
 
2.22  Increase in Commitments. 
 
2.22.1  Amount of Increase in Commitments. The Borrower may at any time, with
the consent of the Agent but without the consent of the Lenders except as
provided in Sections 2.22.2 and 2.22.5(i), increase the Aggregate Commitment up
to an amount not to exceed $250,000,000, subject to satisfaction of each and all
of the requirements contained in this Section 2.22.
 
2.22.2  Eligibility. Each Lender who provides an increase in the Aggregate
Commitment (each a "New Commitment Provider") shall be either an existing Lender
at the time of the increase (each an "Existing Lender") or a financial
institution reasonably acceptable to the Agent and the Borrower (and the
Borrower’s acceptance shall not be unreasonably withheld) that is not then
currently a Lender (each a "New Lender") provided, that the Borrower shall first
offer any increase in the Commitments to the Existing Lenders by giving notice
thereof to each of the Existing Lenders and fifteen (15) Business Days to
respond to such notice (failure to respond on a timely basis shall be deemed a
rejection). Any notice given hereunder shall not be deemed to be a request for,
or requirement of, consent from any Existing Lender who is not a New Commitment
Provider to the increase in the Aggregate Commitment.
 
2.22.3  Notice. The Borrower and the Agent jointly shall notify the Lenders at
least fifteen (15) Business Days before the date ("Commitment Increase Effective
Date") any increase in the Aggregate Commitment shall become effective. Such
notice shall state the amount of the increase in the Aggregate Commitment, the
names of the Lenders providing the additional Commitments and the Commitment
Increase Effective Date. 
 
2.22.4  Minimum Amount. Any increase in the Aggregate Commitment provided by any
individual Lender shall be in an amount not less than $5,000,000 and integral
multiples of $1,000,000 in excess thereof.
 
2.22.5  Implementation of Increase. On the Commitment Increase Effective Date:
 

(i)  
Joinder. Each New Commitment Provider shall execute and deliver to the Agent two
Business Days prior to the Commitment Increase Effective Date a Joinder in the
form attached as Exhibit L ("Lender Joinder"), which shall become effective on
the Commitment Increase Effective Date. The Lender Joinder shall set forth the
Commitment provided by the New Commitment Provider if it is a New Lender and the
new amount of the Commitment and the increase in the Commitment to be provided
if it is an Existing Lender. If the New Commitment Provider is a New Lender it
shall on the Effective Date join and become a party to this Agreement and the
other Loan Documents as a Lender for all purposes hereunder and thereunder,
subject to the provisions of this Section 2.22, having a Commitment as set forth
in the Lender Joinder tendered by the same. Any Lender whose Commitment shall
remain unaffected shall be deemed to have consented and agreed to such Lender
Joinder.

 

(ii)  
Floating Rate Loans. Each New Commitment Provider shall (i) purchase from the
other Lenders such New Commitment Provider's Pro Rata Share in any Floating Rate
Loans outstanding on the Commitment Increase Effective Date, and (ii) share
ratably in all Floating Rate Loans borrowed by the Borrower after the Commitment
Increase Effective Date.

 

(iii)  
Eurodollar Rate Loans. Each New Commitment Provider shall (a) purchase from the
other Lenders such New Commitment Provider's Pro Rata Share in each outstanding
Eurodollar Loan on the date on which the Borrower either renews its Eurodollar
Loan election with respect to the Eurodollar Loan in question or converts such
Eurodollar Loan to a Floating Rate Loan, provided that the New Commitment
Providers shall not purchase an interest in such Loans from the other Lenders on
the Commitment Increase Effective Date (unless the Commitment Increase Effective
Date is a renewal or conversion date, as applicable, in which case the preceding
sentence shall apply), and (b) shall participate in all new Eurodollar Loans
borrowed by the Borrower on and after the Commitment Increase Effective Date.

 

(iv)  
Facility LCs. Each New Commitment Provider shall participate in all Facility LCs
outstanding on the Commitment Increase Effective Date according to its Pro Rata
Share and in accordance with the terms of this Agreement.

 

(v)  
Limit on Amount. Any increase in the Commitments pursuant to this Section 2.22
may not cause the total amount of the Commitments to exceed $250,000,000.

 

(vi)  
No Default or Unmatured Default; Representations and Warranties. There shall
exist no Default or Unmatured Default on the Commitment Increase Effective Date.
Without limiting that sentence, the representations and warranties contained in
Article V must be true and correct in all material respects as of such
Commitment Increase Effective Date except to the extent any such representation
is stated to relate solely to an earlier date, in which case such representation
shall have been true and correct on and as of such earlier date. If a Default or
Unmatured Default exists on such Commitment Increase Effective Date, or such
representations and warranties are not true and correct to the extent and as
required in the second sentence of this Section 2.22.5(vi), the Borrower shall
not request an increase of, and may not increase, the Aggregate Commitment.

 

(vii)  
No Obligation. No Existing Lender shall be required to increase its Commitment
in the event that the Borrower asks such Existing Lender to provide all or a
portion of any increase in the Aggregate Commitment desired by the Borrower.

 

ARTICLE III

YIELD PROTECTION; TAXES

3.1 Yield Protection. If, on or after the date of this Agreement, the adoption
of any law or any governmental or quasi-governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law), or any change
in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation or the LC Issuer with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:

(i)  
subjects any Lender or any applicable Lending Installation or the LC Issuer to
any Taxes, or changes the basis of taxation of payments (other than with respect
to Excluded Taxes) to any Lender or the LC Issuer in respect of its Eurodollar
Loans, Facility LCs or participations therein, or

(ii)  
imposes or increases or deems applicable any reserve, assessment, insurance
charge, special deposit or similar requirement against assets of, deposits with
or for the account of, or credit extended by, any Lender or any applicable
Lending Installation or the LC Issuer (other than reserves and assessments taken
into account in determining the interest rate applicable to Eurodollar
Advances), or

(iii)  
imposes any other condition the result of which is to increase the cost to any
Lender or any applicable Lending Installation or the LC Issuer of making,
funding or maintaining its Eurodollar Loans, or of issuing or participating in
Facility LCs, or reduces any amount receivable by any Lender or any applicable
Lending Installation or the LC Issuer in connection with its Eurodollar Loans,
Facility LCs or participations therein, or requires any Lender or any applicable
Lending Installation or the LC Issuer to make any payment calculated by
reference to the amount of Eurodollar Loans, Facility LCs or participations
therein held or interest received by it, by an amount deemed material by such
Lender or the LC Issuer, as the case may be,

and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation Lender or the LC Issuer, as the case may be, of
making or maintaining its Eurodollar Loans or Commitment or of issuing or
participating in Facility LCs or to reduce the return received by such Lender or
applicable Lending Installation or the LC Issuer, as the case may be, in
connection with such Eurodollar Loans, Commitment, Facility LCs or
participations therein, then, within 15 days of demand by such Lender or the LC
Issuer, as the case may be, the Borrower shall pay such Lender or the LC Issuer,
as the case may be, such additional amount or amounts as will compensate such
Lender, or the LC Issuer, as the case may be, for such increased cost or
reduction in amount received.

3.2 Changes in Capital Adequacy Regulations. If a Lender or the LC Issuer
determines the amount of capital required or expected to be maintained by such
Lender or the LC Issuer, any Lending Installation of such Lender or the LC
Issuer or any corporation controlling such Lender or the LC Issuer is increased
as a result of a Change, then, within 15 days of demand by such Lender or the LC
Issuer, the Borrower shall pay such Lender or the LC Issuer the amount necessary
to compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender or the LC Issuer determines is attributable
to this Agreement, its Outstanding Credit Exposure or its Commitment to make
Loans and issue or participate in Facility LCs, as the case may be, hereunder
(after taking into account such Lender or the LC Issuer's policies as to capital
adequacy). "Change" means (i) any change after the date of this Agreement in the
Risk-Based Capital Guidelines or (ii) any adoption of or change in any other
law, governmental or quasi-governmental rule, regulation, policy, guideline,
interpretation, or directive (whether or not having the force of law) after the
date of this Agreement which affects the amount of capital required or expected
to be maintained by any Lender or the LC Issuer or any Lending Installation or
any corporation controlling any Lender or the LC Issuer. "Risk-Based Capital
Guidelines" means (i) the risk-based capital guidelines in effect in the United
States on the date of this Agreement, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International Convergence
of Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the date of this Agreement.

3.3 Availability of Types of Advances. If any Lender determines that maintenance
of its Eurodollar Loans at a suitable Lending Installation would violate any
applicable law, rule, regulation, or directive, whether or not having the force
of law, or if the Required Lenders determine that (i) deposits of a type and
maturity appropriate to match fund Eurodollar Advances are not available or (ii)
the interest rate applicable to Eurodollar Advances does not accurately reflect
the cost of making or maintaining Eurodollar Advances, then the Agent shall
suspend the availability of Eurodollar Advances and require any affected
Eurodollar Advances to be repaid or converted to Floating Rate Advances, subject
to the payment of any funding indemnification amounts required by Section 3.4.

3.4 Funding Indemnification. If any payment of a Eurodollar Advance occurs on a
date which is not the last day of the applicable Interest Period, whether
because of acceleration, prepayment or otherwise, or a Eurodollar Advance is not
made on the date specified by the Borrower for any reason other than default by
the Lenders, the Borrower will indemnify each Lender for any loss or cost
incurred by it resulting therefrom, including, without limitation, any loss or
cost in liquidating or employing deposits acquired to fund or maintain such
Eurodollar Advance.

3.5 Taxes.

(i)  
All payments by the Borrower to or for the account of any Lender, the LC Issuer
or the Agent hereunder or under any Note or Facility LC Application shall be
made free and clear of and without deduction for any and all Taxes. If the
Borrower shall be required by law to deduct any Taxes from or in respect of any
sum payable hereunder to any Lender, the LC Issuer or the Agent, (a) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 3.5) such Lender, the LC Issuer or the Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (b) the Borrower shall make such deductions, (c) the
Borrower shall pay the full amount deducted to the relevant authority in
accordance with applicable law and (d) the Borrower shall furnish to the Agent
the original copy of a receipt evidencing payment thereof within 30 days after
such payment is made.

(ii)  
In addition, the Borrower hereby agrees to pay any present or future stamp or
documentary taxes and any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or under any Note or Facility
LC Application or from the execution or delivery of, or otherwise with respect
to, this Agreement or any Note or any Facility LC Application ("Other Taxes").

(iii)  
The Borrower hereby agrees to indemnify the Agent, the LC Issuer and each Lender
for the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed on amounts payable under this Section 3.5) paid by
the Agent, the LC Issuer or such Lender as a result of its Commitment, any Loans
made by it hereunder, or otherwise in connection with its participation in this
Agreement and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto. Payments due under this indemnification shall
be made within 30 days of the date the Agent, the LC Issuer or such Lender makes
demand therefor pursuant to Section 3.6.

(iv)  
Each Lender that is not incorporated under the laws of the United States of
America or a state thereof (each a "Non-U.S. Lender") agrees that it will, not
more than ten Business Days after the date of this Agreement, (i) deliver to the
Agent two duly completed copies of United States Internal Revenue Service Form
W-8BEN or W-8ECI, certifying in either case that such Lender is entitled to
receive payments under this Agreement without deduction or withholding of any
United States federal income taxes, and (ii) deliver to the Agent a United
States Internal Revenue Form W-8 or W-9, as the case may be, and certify that it
is entitled to an exemption from United States backup withholding tax. Each
Non-U.S. Lender further undertakes to deliver to each of the Borrower and the
Agent (x) renewals or additional copies of such form (or any successor form) on
or before the date that such form expires or becomes obsolete, and (y) after the
occurrence of any event requiring a change in the most recent forms so delivered
by it, such additional forms or amendments thereto as may be reasonably
requested by the Borrower or the Agent. All forms or amendments described in the
preceding sentence shall certify that such Lender is entitled to receive
payments under this Agreement without deduction or withholding of any United
States federal income taxes, unless an event (including without limitation any
change in treaty, law or regulation) has occurred prior to the date on which any
such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Lender from duly completing and
delivering any such form or amendment with respect to it and such Lender advises
the Borrower and the Agent that it is not capable of receiving payments without
any deduction or withholding of United States federal income tax.

(v)  
For any period during which a Non-U.S. Lender has failed to provide the Borrower
with an appropriate form pursuant to clause (iv), above (unless such failure is
due to a change in treaty, law or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
occurring subsequent to the date on which a form originally was required to be
provided), such Non-U.S. Lender shall not be entitled to indemnification under
this Section 3.5 with respect to Taxes imposed by the United States; provided
that, should a Non-U.S. Lender which is otherwise exempt from or subject to a
reduced rate of withholding tax become subject to Taxes because of its failure
to deliver a form required under clause (iv), above, the Borrower shall take
such steps as such Non-U.S. Lender shall reasonably request to assist such
Non-U.S. Lender to recover such Taxes.

(vi)  
Any Lender that is entitled to an exemption from or reduction of withholding tax
with respect to payments under this Agreement or any Note pursuant to the law of
any relevant jurisdiction or any treaty shall deliver to the Borrower (with a
copy to the Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law as
will permit such payments to be made without withholding or at a reduced rate.

(vii)  
If the U.S. Internal Revenue Service or any other governmental authority of the
United States or any other country or any political subdivision thereof asserts
a claim that the Agent did not properly withhold tax from amounts paid to or for
the account of any Lender (because the appropriate form was not delivered or
properly completed, because such Lender failed to notify the Agent of a change
in circumstances which rendered its exemption from withholding ineffective, or
for any other reason), such Lender shall indemnify the Agent fully for all
amounts paid, directly or indirectly, by the Agent as tax, withholding therefor,
or otherwise, including penalties and interest, and including taxes imposed by
any jurisdiction on amounts payable to the Agent under this subsection, together
with all costs and expenses related thereto (including attorneys fees and time
charges of attorneys for the Agent, which attorneys may be employees of the
Agent). The obligations of the Lenders under this Section 3.5(vii) shall survive
the payment of the Obligations and termination of this Agreement.

3.6 Lender Statements; Survival of Indemnity. To the extent reasonably possible,
each Lender shall designate an alternate Lending Installation with respect to
its Eurodollar Loans to reduce any liability of the Borrower to such Lender
under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of Eurodollar
Advances under Section 3.3, so long as such designation is not, in the judgment
of such Lender, disadvantageous to such Lender. Each Lender shall deliver a
written statement of such Lender to the Borrower (with a copy to the Agent) as
to the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such written
statement shall set forth in reasonable detail the calculations upon which such
Lender determined such amount and shall be final, conclusive and binding on the
Borrower in the absence of manifest error. Determination of amounts payable
under such Sections in connection with a Eurodollar Loan shall be calculated as
though each Lender funded its Eurodollar Loan through the purchase of a deposit
of the type and maturity corresponding to the deposit used as a reference in
determining the Eurodollar Rate applicable to such Loan, whether in fact that is
the case or not. Unless otherwise provided herein, the amount specified in the
written statement of any Lender shall be payable on demand after receipt by the
Borrower of such written statement. The obligations of the Borrower under
Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of the Obligations and
termination of this Agreement.

ARTICLE IV

CONDITIONS PRECEDENT

4.1. Initial Credit Extension. The effectiveness of this Agreement and the
obligation of the Lenders to make the initial Credit Extension hereunder, which
initial Credit Extension shall occur no later than September 23, 2005, shall be
subject to the satisfaction of the following conditions precedent and, if
applicable, the delivery by the Borrower to the Agent with sufficient copies for
the Lenders of the following:

(i)  
the Borrower has furnished to the Agent, with sufficient copies for the Lenders,
the following, in each case satisfactory to the Agent, in its discretion, and
its counsel:

(a)  
Copies of the articles or certificate of incorporation of the Borrower and each
other Loan Party, together with all amendments, and a certificate of good
standing (or comparable certificate in the case of those governmental offices
which do not issue good standing certificates), each certified by the
appropriate governmental officer in its jurisdiction of incorporation or
formation.

(b)  
Copies, certified by the Secretary or Assistant Secretary (or Person serving an
equivalent function) of the Borrower and each other Loan Party, of its by-laws
or operating agreement, as applicable, and of its board of directors'
resolutions and of resolutions or actions of any other body authorizing the
execution of the Loan Documents to which the Borrower and each other Loan Party
is a party.

(c)  
An incumbency certificate, executed by the Secretary or Assistant Secretary (or
Person serving an equivalent function) of, as applicable, the Borrower and each
other Loan Party, which shall identify by name and title and bear the signatures
of the Authorized Officers and any other officers or Persons of the Borrower and
each other Loan Party authorized to sign the Loan Documents to which, as
applicable, the Borrower and each other Loan Party is a party, upon which
certificate the Agent and the Lenders shall be entitled to rely until informed
of any change in writing by the Borrower and each other Loan Party.

(d)  
A certificate, signed by the chief financial officer of the Borrower, in the
form of Exhibit P stating that on the initial Credit Extension Date no Default
or Unmatured Default has occurred and is continuing.

(e)  
A written opinion of the Borrower's and the Guarantors' counsel, addressed to
the Lenders in substantially the form of Exhibit A.

(f)  
Any Notes requested by a Lender pursuant to Section 2.15 payable to the order of
each such requesting Lender.

(g)  
Written money transfer instructions from the Borrower, in substantially the form
of Exhibit D, addressed to the Agent and signed by an Authorized Officer,
together with such other related money transfer authorizations as the Agent may
have reasonably requested.

(h)  
If the initial Credit Extension will be the issuance of a Facility LC, a
properly completed Facility LC Application.

(i)  
All Collateral Documents and other Loan Documents executed by the Borrower or
the Guarantors, as the case may be, including without limitation any amendments,
reaffirmations or supplements to the Pledge and Security Agreement, the
Guaranty, the Mortgages, the Negative Pledge Agreement, the Indemnity Agreement,
the Assignment of Patents, Trademarks and Copyrights and the Intercompany
Subordination Agreement requested by the Collateral Agent to be executed and
delivered on the Closing Date.

(j)  
Intentionally Omitted.

(k)  
Intentionally Omitted.

(l)  
Intentionally Omitted.

(m)  
Intentionally Omitted.

(n)  
The insurance certificate described in Section 5.20 and 6.6(ii).

(o)  
Intentionally Omitted.

(p)  
Reports of searches of personal property of records from the appropriate
reporting agencies listed on Schedule 4.1(i)(p). The Agent may obtain such
reports but the Borrower shall pay all costs associated with obtaining them. The
reports of searches of the personal property of records shall not disclose any
security interest in the Loan Parties' personal property prior to the Collateral
Agent's security interest therein other than Permitted Liens.

(q)  
All material third-party consents required to effectuate the transactions under
the Loan Documents, including without limitation those described on Schedule
4.1(i)(q).

(r)  
Evidence satisfactory to the Agent that no action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed
before any court, governmental agency or legislative body to enjoin, restrain or
prohibit, or to obtain damages in respect of, this Agreement, the other Loan
Documents or the consummation of the transactions contemplated hereby or thereby
or which, in the Agent's sole discretion, would make it inadvisable to
consummate the transactions contemplated by this Agreement or any of the other
Loan Documents.

(s)  
Evidence satisfactory to the Agent with respect to the proper perfection and
priority of all of the Liens created in favor of the Collateral Agent securing
all of the Secured Obligations.

(t)  
Evidence satisfactory to the Agent that prior to, or simultaneously with the
closing of the transactions described herein, the Borrower has paid all of the
Refinanced Indebtedness and shall have delivered to the Agent a copy of a payoff
letter, in a form satisfactory to the Agent, in its discretion, signed by the
“Term Note Purchasers” as defined in the Previous Credit Agreement and
evidencing the payoff and termination of such Refinanced Indebtedness, as well
as termination of their interest in any Liens in connection therewith.

(u)  
Intentionally Omitted.

(v)  
Unqualified audited financial statements for the Borrower dated as of December
31, 2004.

(w)  
A certificate in the form of Exhibit P signed by the chief financial officer of
the Borrower stating that at the initial Credit Extension no Material Adverse
Effect has occurred since December 31, 2004 or is occurring, and all of the
representations and warranties made by or on behalf of any of the Loan Parties
relating to this Agreement and/or any of the other Loan Documents remain true,
correct and complete.

(x)  
Payment or reimbursement of expenses as and to the extent required under Section
9.6 and payment of fees under Section 10.13.

(y)  
Such other documents as the Agent, any Lender or their counsel may have
reasonably requested.

 
(ii)
The Agent and the Lenders shall have determined to their satisfaction:

(a)  
There exists no Default or Unmatured Default.

(b)  
No Material Adverse Effect shall have occurred since December 31, 2004.

(c)  
The Loan Parties have complied with all applicable requirements of Regulation U.

(d)  
All legal and regulatory matters (including those relating to taxes) are
satisfactory.

(e)  
No injunctions or temporary restraining orders against any Loan Party exist
which would prohibit a Credit Extension.

(f)  
No existing or potential environmental liability with respect to any Loan Party
and/or any Collateral exists that would have a Material Adverse Effect.

4.2 Each Credit Extension. The Lenders shall not be required to make any Credit
Extension unless on the applicable Credit Extension Date:

 

(i)  
There exists no Default or Unmatured Default.

 

(ii)  
The representations and warranties contained in Article V are true and correct
in all material respects as of such Credit Extension Date except to the extent
any such representation or warranty is stated to relate solely to an earlier
date, in which case such representation or warranty shall have been true and
correct on and as of such earlier date.

(iii)  
All legal matters incident to the making of such Credit Extension shall be
satisfactory to the Lenders and their counsel.

Each Borrowing Notice or request for issuance of a Facility LC with respect to
each such Credit Extension shall constitute a representation and warranty by the
Borrower that the conditions contained in Sections 4.2(i) and (ii) have been
satisfied.

ARTICLE V

REPRESENTATIONS AND WARRANTIES

The Loan Parties jointly and severally represent and warrant to the Agent and
the Lenders that:

5.1 Existence and Standing. Each of the Loan Parties and its Subsidiaries is a
corporation, partnership (in the case of Subsidiaries only) or limited liability
company duly and properly incorporated or organized, as the case may be, validly
existing and (to the extent such concept applies to such entity) in good
standing under the laws of its jurisdiction of incorporation or organization and
has all requisite authority to conduct its respective business in each
jurisdiction in which its respective business is conducted and where the failure
to do so would cause a Material Adverse Effect.

5.2 Authorization and Validity. Each Loan Party has the power and authority and
legal right to execute and deliver the Loan Documents to which it is a party and
to perform its obligations thereunder. The execution and delivery by the Loan
Party of the Loan Documents to which it is a party and the performance of its
obligations thereunder have been duly authorized by proper corporate
proceedings, and the Loan Documents to which the Loan Party is a party
constitute legal, valid and binding obligations of the applicable Loan Party
enforceable against the applicable Loan Party in accordance with their terms,
except as enforceability may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally.

5.3 No Conflict; Government Consent. Neither the execution and delivery by a
Loan Party of the Loan Documents to which it is a party, nor the consummation by
it of the transactions therein contemplated, nor compliance with the provisions
thereof by it will violate (i) any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on any such Loan Party or (ii) any such Loan
Party's articles or certificate of incorporation, partnership agreement,
certificate of partnership, articles or certificate of organization, by-laws, or
operating or other management agreement, as the case may be, or (iii) the
provisions of any indenture, instrument or agreement to which any such Loan
Party is a party or is subject, or by which it, or its Property, is bound, or
conflict with or constitute a default thereunder, or except for the Liens
required by the terms of Loan Documents, result in, or require, the creation or
imposition of any Lien in, of or on the Property of any such Loan Party pursuant
to the terms of any such indenture, instrument or agreement. Except for the
recordation of any applicable Collateral Documents with any applicable
governmental authority, no order, consent, adjudication, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, or other action in respect of any governmental or public body or
authority, or any subdivision thereof, which has not been obtained by any Loan
Party, is required to be obtained by any Loan Party in connection with the
execution and delivery of the Loan Documents, the borrowings under this
Agreement, the payment and performance by the Borrower of the Obligations or the
legality, validity, binding effect or enforceability of any of the Loan
Documents. Notwithstanding anything in this Agreement or the other Loan
Documents to the contrary, the parties to this Agreement and the other Loan
Documents acknowledge that (i) the transfer, assignment, change of ownership or
interest, foreclosure or realization on any of the Collateral or the stock of
Churchill Downs Management Company or (ii) any transfer, assignment, or change
of ownership or interest in any pari-mutuel permits or licenses must comply with
applicable law, which may require prior approval by the Florida Division of
Pari-Mutuel Wagering or comparable governmental authority in the applicable
State.

5.4 Financial Statements. The December 31, 2004 consolidated financial
statements of the Loan Parties heretofore delivered to the Lenders were prepared
in accordance with generally accepted accounting principles in effect on the
date such statements were prepared and fairly present the consolidated financial
condition and operations of the Loan Parties at such date and the consolidated
results of their operations for the period then ended.

5.5 Material Adverse Change. Since December 31, 2004 there has been no change in
the business, Property, prospects, condition (financial or otherwise) or results
of operations of the Loan Parties taken as a whole, which could reasonably be
expected to have a Material Adverse Effect.

5.6 Taxes. Each Loan Party has filed all United States federal tax returns and
all other tax returns which are required to be filed and has paid all taxes due
pursuant to said returns or pursuant to any assessment received by such Loan
Party, except such taxes, if any, as are being contested in good faith and as to
which adequate reserves have been provided in accordance with Agreement
Accounting Principles and as to which no Lien exists. The United States income
tax returns of each Loan Party and the other Loan Parties have been audited by
the Internal Revenue Service through the fiscal year ended December 31, 2000. No
tax liens have been filed and no claims are being asserted with respect to any
such taxes. The charges, accruals and reserves on the books of each Loan Party
in respect of any taxes or other governmental charges are adequate.

5.7 Litigation and Contingent Obligations. There is no litigation, arbitration,
governmental investigation, proceeding or inquiry pending or, to the knowledge
of any of their officers, threatened against or affecting any Loan Party which
could reasonably be expected to have a Material Adverse Effect or which seeks to
prevent, enjoin or delay the making of any Credit Extensions. Other than any
liability incident to any litigation, arbitration or proceeding which could not
reasonably be expected to have a Material Adverse Effect, the Loan Parties have
no material contingent obligations not provided for or disclosed in the
financial statements referred to in Section 5.4.

5.8 Subsidiaries. Schedule 1 contains an accurate list of all Subsidiaries of
the Loan Parties as of the date of this Agreement, setting forth their
respective jurisdictions of organization and the percentage of their respective
capital stock or other ownership interests owned by each Loan Party. All of the
issued and outstanding shares of capital stock or other ownership interests of
such Subsidiaries have been (to the extent such concepts are relevant with
respect to such ownership interests) duly authorized and issued and are fully
paid and non-assessable.

5.9 ERISA. Except for any Multiemployer Plan, none of the Loan Parties sponsors
or contributes to a Plan that is covered by Title IV of ERISA or that is subject
to the minimum funding standards under Section 412 of the Code. Neither any Loan
Party nor any other member of the Controlled Group has incurred, or is
reasonably expected to incur, any withdrawal liability to Multiemployer Plans in
excess of $10,000,000.00 in the aggregate. No Loan Party has any knowledge that
any Plan fails to comply in all material respects with all applicable
requirements of law and regulation. Neither the Borrower nor any other member of
the Controlled Group has withdrawn from any Plan or initiated steps to do so,
and no steps have been taken to reorganize or terminate any Plan.

5.10 Accuracy of Information. No information, exhibit or report furnished by the
Borrower or any of the other Loan Parties to the Agent or to any Lender in
connection with the negotiation of, or compliance with, the Loan Documents
contained any misstatement of material fact or omitted to state a material fact
necessary to make the statements contained therein not misleading.

5.11 Regulation U. Margin stock (as defined in Regulation U) constitutes less
than 25% of the value of those assets of the Loan Parties which are subject to
any limitation on sale, pledge, or other restriction hereunder.

5.12 Material Agreements. Neither the Borrower nor any Subsidiary is a party to
any agreement or instrument or subject to any charter or other corporate
restriction which could reasonably be expected to have a Material Adverse
Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.

5.13 Compliance With Laws. The Loan Parties have complied with all applicable
statutes, rules, regulations, orders and restrictions of any domestic or foreign
government or any instrumentality or agency thereof having jurisdiction over the
conduct of their respective businesses or the ownership of their respective
Property except for any failure to comply with any of the foregoing which could
not reasonably be expected to have a Material Adverse Effect.

5.14 Ownership of Properties. Except as set forth on Schedule 2, on the date of
this Agreement, the Loan Parties will have good title, free of all Liens other
than Permitted Liens, to all of the Property and assets reflected in the
Borrower's most recent consolidated financial statements provided to the Agent
as owned by the Loan Parties. Except for the Permitted Liens, liens granted to
the Collateral Agent for the benefit of the Lenders pursuant to the Mortgages do
constitute and will constitute valid first priority Liens under applicable law.
Borrower will take all such action as will be necessary or advisable to
establish such Lien of the Collateral Agent and its priority as described in the
preceding sentence at or prior to the time required for such purpose, and there
will be as of the date of execution and delivery of the Mortgages no necessity
for any further action in order to protect, preserve and continue such Lien and
such priority except for (i) the filing of continuation statements to continue
financing statements (filed as fixture filings) upon the expiration thereof and
(ii) for the recordation of the Calder Mortgage and for the recording of the
Mortgages (other than the Calder Mortgage) all of which recordation of such
Mortgages (other than the Calder Mortgage and Mortgages entered into after the
Previous Closing Date) shall have occurred on the Previous Closing Date (or
within one Business Day following the Previous Closing Date provided that the
title insurance policy relating to such Mortgages (other than the Calder
Mortgage and Mortgages entered into after the Previous Closing Date) provides
coverage as of the Previous Closing Date based on pro forma policies delivered
and accepted on or before the Previous Closing Date).
 
5.15 Plan Assets; Prohibited Transactions. The Borrower (a) is not an entity
deemed to hold "plan assets" within the meaning of 29 C.F.R. § 2510.3-101 of an
employee benefit plan (as defined in Section 3(3) of ERISA) which is subject to
Title I of ERISA or any plan (within the meaning of Section 4975 of the Code),
and assuming the source of the Loans does not in any case include the assets of
any employee benefit plan, neither the execution of this Agreement nor the
making of Credit Extensions hereunder gives rise to a prohibited transaction
within the meaning of Section 406 of ERISA or Section 4975 of the Code, and (b)
the Borrower is an "operating company" as defined in 29 C.F.R 2510-101 (c) or
"benefit plan investors" (as defined in 29 C.F.R. § 2510.3-101(f)) do not own
25% or more of the value of any class of equity interests in the Borrower.

5.16 Environmental Matters. In the ordinary course of its business, the officers
of the Borrower consider the effect of Environmental Laws on the business of the
Loan Parties, in the course of which they identify and evaluate potential risks
and liabilities accruing to the Borrower due to Environmental Laws. On the basis
of this consideration, the Borrower has concluded that Environmental Laws cannot
reasonably be expected to have a Material Adverse Effect. Neither the Borrower
nor any Subsidiary has received any notice to the effect that its operations are
not in material compliance with any of the requirements of applicable
Environmental Laws or are the subject of any federal or state investigation
evaluating whether any remedial action is needed to respond to a release of any
toxic or hazardous waste or substance into the environment, which non-compliance
or remedial action could reasonably be expected to have a Material Adverse
Effect.

5.17 Investment Company Act. Neither the Borrower nor any Subsidiary is an
"investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.

5.18 Public Utility Holding Company Act. Neither the Borrower nor any Subsidiary
is a "holding company" or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended.

5.19 Post-Retirement Benefits. The present value of the expected cost of
post-retirement medical and insurance benefits payable by the Loan Parties to
their employees and former employees, as estimated by the Borrower in accordance
with procedures and assumptions deemed reasonable by the Required Lenders, does
not exceed $10,000,000.00.

5.20 Insurance. The certificate signed by the President or chief financial
officer of the Borrower, that attests to the existence and adequacy of, and
summarizes, the property and casualty insurance program carried by the Borrower
with respect to itself and the other Loan Parties and that has been furnished by
the Borrower to the Agent and the Lenders, is complete and accurate. This
summary includes the insurer's or insurers' name(s), policy number(s),
expiration date(s), amount(s) of coverage, type(s) of coverage, exclusion(s),
and deductibles. This summary also includes similar information, and describes
any reserves, relating to any self-insurance program that is in effect.

5.21 Solvency. (i) Immediately after the consummation of the transactions to
occur on the date hereof and immediately following the making of each Loan, if
any, made on the date hereof and after giving effect to the application of the
proceeds of such Loans, (a) the fair value of the assets of the Loan Parties on
a consolidated basis, at a fair valuation, will exceed the debts and
liabilities, subordinated, contingent or otherwise, of the Loan Parties on a
consolidated basis; (b) the present fair saleable value of the Property of the
Loan Parties on a consolidated basis will be greater than the amount that will
be required to pay the probable liability of the Loan Parties on a consolidated
basis on their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured; (c)
the Loan Parties on a consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (d) the Loan Parties on a
consolidated basis will not have unreasonably small capital with which to
conduct the businesses in which they are engaged as such businesses are now
conducted and are proposed to be conducted after the date hereof.

(ii) The Borrower does not intend to, or to permit any of the other Loan Parties
to, and does not believe that it or any of the other Loan Parties will, incur
debts beyond such Person's ability to pay such debts as they mature, taking into
account the timing of and amounts of cash to be received by it or any such Loan
Party and the timing of the amounts of cash to be payable on or in respect of
its Indebtedness or the Indebtedness of any such Loan Party.

5.22 Intellectual Property. Schedule 5.22 sets forth a true and complete list,
differentiated by each Loan Party, of all of the patents, trademarks, licenses
not included in Schedule 5.25, copyrights and other intellectual property owned
by any of the Loan Parties or which any of them has an interest.

5.23 Properties. Schedule 5.23 sets forth a true and complete list,
differentiated by each Loan Party, of the addresses of all Real Property.

5.24 Operating Locations. Schedule 5.24 sets forth a true and complete list,
differentiated by each Loan Party, of the street addresses of each of the Loan
Parties' operating locations.

5.25 Certain Licenses. Schedule 5.25 sets forth a true and complete list,
differentiated by each Loan Party of all licenses or other authorities under
which any Loan Party is a licensee from any racing commission or authority or
holder of other racing rights.

5.26 Predecessor Entities of the Loan Parties. Schedule 5.26 sets forth a list
of any and all predecessors and/or prior names of any Loan Party within the past
five (5) years, including any entity or entities which may no longer exist,
whether by reason of merger, acquisition, consolidation, sale of its material
assets, dissolution, bankruptcy, reorganization, which may have or had an
interest in the Collateral or any part thereof, together with such predecessor's
(1) state of incorporation, (2) the jurisdictional location of all of such
entities offices and locations and (3) all jurisdictional locations where any
Collateral may have been kept.

ARTICLE VI

COVENANTS

From and after the date of this Agreement, unless the Required Lenders shall
otherwise consent in writing:

6.1 Financial Reporting. The Borrower will maintain, for itself and each
Subsidiary, a system of accounting established and administered in accordance
with Agreement Accounting Principles, and furnish to the Lenders:

 
(i) 
Within ninety (90) days after the close of each of Borrower's fiscal years, an
unqualified (except for qualifications relating to changes in Agreement
Accounting Principles or practices reflecting changes in generally accepted
accounting principles and required or approved by the Borrower's independent
certified public accountants) audit report certified by PriceWaterhouseCoopers
or such other independent certified public accountants acceptable to the
required Lenders, prepared in accordance with Agreement Accounting Principles on
a consolidated basis for itself and the other Loan Parties, including
consolidated balance sheets as of the end of such period, related consolidated
profit and loss and reconciliation of surplus statements, and a consolidated
statement of cash flows, accompanied by any management letter prepared by said
accountants, provided that satisfaction of the requirements of this Section
6.1(i) shall be deemed to have been met by delivery within the time frame
specified above of (a) copies of the Borrower's Annual Report on Form 10-K for
such fiscal year prepared in accordance with the requirements therefor and filed
with the SEC, and (b) the financial statements and reports otherwise required in
this Section 6.1(i), consolidated as to the Borrower and the other Loan Parties,
except that such financial statements and reports need not be audited and may be
internally prepared.

(ii)  
Within forty-five (45) days after the close of the first three quarterly periods
of each of its fiscal years, for itself and the other Loan Parties, consolidated
unaudited balance sheets as at the close of each such period and consolidated
profit and loss statements and a consolidated statement of cash flows for the
period from the beginning of such fiscal year to the end of such quarter, all
certified by its chief financial officer, provided that satisfaction of the
requirements of this Section 6.1(ii) shall be deemed to have been met by
delivery within the time frame specified above of copies of (a) the Borrower's
Quarterly Report on Form 10-Q prepared in accordance with the requirements
therefor and filed with the SEC, and (b) the financial statements and reports
otherwise required in this Section 6.1(ii), consolidated as to the Borrower and
the other Loan Parties.

(iii)  
As soon as available, but in any event within ninety (90) days after the
beginning of each fiscal year of the Borrower, a copy of the plan and budget
(including, at a minimum, a projected consolidated balance sheet for the
following fiscal year end and projected quarterly income statements) of the
Borrower and the other Loan Parties for such fiscal year.

(iv)  
Together with the financial statements required under Sections 6.1(i) and (ii),
a compliance certificate, in substantially the form of Exhibit B attached
hereto, signed by its chief financial officer or treasurer showing the
calculations necessary to determine compliance with this Agreement and stating
that no Default or Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof.

(v)  
Within two hundred seventy (270) days after the close of each fiscal year, a
statement of the Unfunded Liabilities of each Single Employer Plan, if any,
certified as correct by an actuary enrolled under ERISA.

(vi)  
If the Borrower has established a Plan, as soon as possible and in any event
within 10 days after the Borrower knows that any Reportable Event has occurred
with respect to any Plan, a statement, signed by the chief financial officer of
the Borrower, describing said Reportable Event and the action which the Borrower
proposes to take with respect thereto.

(vii)  
As soon as possible and in any event within 10 days after receipt by the
Borrower, a copy of (a) any notice or claim to the effect that the Borrower or
any of the other Loan Parties is or may be liable to any Person as a result of
the release by the Borrower, any of the other Loan Parties, or any other Person
of any Hazardous Materials into the environment, and (b) any notice alleging any
violation of any Environmental Laws by the Borrower or any of the other Loan
Parties, which, in either case, could reasonably be expected to have a Material
Adverse Effect.

(viii)  
Promptly upon request, copies of all annual reports to shareholders (including
without limitation annual reports to shareholders, if any, prepared pursuant to
Rule 14a-3 under the Exchange Act), financial statements, reports and proxy
statements so furnished and which are not otherwise available on the SEC’s Edgar
(or its successor) system.

(ix)  
Promptly upon request, copies of all registration statements and annual,
quarterly, monthly or other regular reports which any of the Loan Parties files
with the SEC and which are not otherwise available on the SEC’s Edgar (or its
successor) system.

(x)  
Such other information (including non-financial information) as the Agent or any
Lender may from time to time reasonably request.

6.2 Use of Proceeds. The Borrower and each other Loan Party will, and will cause
each Subsidiary to, use the proceeds of the Credit Extensions to (a) repay in
full the Refinanced Indebtedness outstanding on or prior to the Closing Date
(without giving effect to the initial Credit Extensions hereunder) and expenses
incurred in connection with such repayment and (b) for general corporate
purposes, including for working capital and Acquisition needs. The Borrower will
not, nor will it permit any Subsidiary to, use any of the proceeds of the
Advances to purchase or carry any "margin stock" (as defined in Regulation U).

6.3 Notice of Default. The Borrower and each other Loan Party will give prompt
notice in writing to the Agent of the occurrence of any Default or Unmatured
Default and of any other development, financial or otherwise, which could
reasonably be expected to have a Material Adverse Effect.

6.4 Conduct of Business. The Borrower and each other Loan Party will, and will
cause each Subsidiary (other than the Excluded Subsidiaries) to, carry on and
conduct its respective business in substantially the same manner and in
substantially the Current Fields of Enterprise, and in any other mode of
gambling, including pari-mutuel wagering on horse racing and Permitted
Alternative Gaming which, in each case, is conducted in full compliance with
applicable law, and do all things necessary to remain duly incorporated or
organized, validly existing and (to the extent such concept applies to such
entity) in good standing as a domestic corporation, partnership or limited
liability company in its jurisdiction of incorporation or organization, as the
case may be, and maintain all requisite authority to conduct its business in
each jurisdiction in which its respective business is conducted in each case in
which the failure to so maintain such authority would have a Material Adverse
Effect.

6.5 Taxes. The Borrower and each other Loan Party will, and will cause each
Subsidiary to, timely file complete and correct United States federal and
applicable foreign, state and local tax returns required by law and pay when due
all taxes, assessments and governmental charges and levies upon such Loan Party
or such Loan Party's income, profits or Property, except those which are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves have been set aside in accordance with Agreement Accounting
Principles.

6.6 Insurance.

 
(i)
The Borrower and each other Loan Party will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts and covering such risks as is consistent with
sound business practice, and the Borrower will furnish to any Lender upon
request full information as to the insurance carried.

 
(ii)
All insurance which the Loan Parties are required to maintain shall be
satis-factory to the Agent in form, amount and insurer. Such insur-ance shall
provide that any loss thereun-der shall be payable notwithstanding any action,
inaction, breach of warranty or condition, breach of declarations,
misrepresentation or negligence of any of the Loan Parties. Each policy shall
contain an agreement by the insurer that, notwithstanding lapse of a policy for
any reason, or right of cancellation by the insurer or any cancellation by any
Loan Party such policy shall continue in full force for the benefit of the
Collateral Agent for at least thirty (30) days after written notice thereof to
the Agent and the applicable Loan Party, and no alteration in any such policy
shall be made except upon thirty (30) days written notice of such proposed
alteration to the Agent and the applicable Loan Party and written approval by
the Agent. At or before the making of the first Credit Extension, each Loan
Party shall provide the Agent with certificates evidencing its due compliance
with the requirements of this Section.

6.7 Compliance with Laws. The Borrower and each other Loan Party will, and will
cause each Subsidiary to, comply with all laws, rules, regulations, orders,
writs, judgments, injunctions, decrees or awards to which such party may be
subject including, without limitation, all Environmental Laws, provided that it
shall not be deemed to be a violation of this Section 6.7 if any failure to
comply with any law would not result in fines, penalties, remediation costs,
other similar liabilities or injunctive relief which in the aggregate would
constitute a Material Adverse Effect.
 
6.8 Maintenance of Properties. The Borrower and each other Loan Party will, and
will cause each Subsidiary (other than the Excluded Subsidiaries) to, do all
things necessary to maintain, preserve, protect and keep its Property in good
repair, working order and condition, normal wear and tear excepted and taking
into account the age and condition of such Property and make all necessary and
proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times.

6.9 Inspection. The Borrower and each other Loan Party will, and will cause each
Subsidiary to, permit the Agent, the Collateral Agent and the Lenders, by their
respective representatives and agents, to inspect any of the Property, books and
financial records of the Borrower and each Subsidiary, to examine and make
copies of the books of accounts and other financial records of the Borrower and
each Subsidiary, and to discuss the affairs, finances and accounts of the
Borrower and each Subsidiary with, and to be advised as to the same by, their
respective officers at such reasonable times and intervals as the Agent, the
Collateral Agent or any Lender may designate; provided, however, so long as no
Default or Unmatured Default has occurred or is continuing, no such inspections,
examinations, or discussions shall occur during the two week period preceding,
or on the day of, the running of the [i] Kentucky Derby or [ii] Breeder's Cup,
if the Breeder's Cup is to be held at Churchill Downs.

6.10 Indebtedness. The Borrower and the other Loan Parties will not, nor will
they permit any Subsidiary (other than Excluded Subsidiaries) to, create, incur
or suffer to exist any Indebtedness, except:

(i)  
The Loans and the Reimbursement Obligations.

(ii)  
Indebtedness existing on the date hereof and described in Schedule 2.

(iii)  
Indebtedness arising under Rate Management Transactions related to the Loans to
the extent permitted under Section 6.22.

(iv)  
Indebtedness secured by any purchase money security interests not exceeding
$5,000,000;

(v)  
Capitalized Lease Obligations in an amount not exceeding $5,000,000;

(vi)  
Indebtedness to sellers in connection with Permitted Acquisitions in an
aggregate amount not to exceed $10,000,000 provided that such Indebtedness is
subordinated to the Indebtedness hereunder pursuant to subordination provisions
acceptable to the Required Lenders in the Required Lenders’ reasonable
discretion;

(vii)  
Indebtedness secured by any Lien permitted pursuant to Section 6.16;

(viii)  
Intentionally Omitted;

(ix)  
Indebtedness of not greater than $153,000,000 under the Master Plan Bond
Transaction;

(x)  
Indebtedness permitted under Section 6.15, reduced by the amounts of
Indebtedness actually outstanding at any time that is described in or subject to
clauses (iv), (v) and/or (vi) of this Section 6.10.

 

6.11 Merger. Without the consent of the Required Lenders, the Borrower will not,
nor will it permit any Subsidiary (other than the Excluded Subsidiaries) to,
merge or consolidate with or into any other Person, except that a Loan Party may
merge into the Borrower or a Wholly-Owned Subsidiary that is or becomes a Loan
Party provided that at least ten (10) Business Days before the date of such
consolidation or merger, the applicable parties shall have delivered to the
Agent all of the new Mortgages, amendments to Mortgages, financing statements,
amendments thereto and other amendments to the Loan Documents and the schedules
thereto required to reflect such consolidation or merger and to perfect or
confirm the Liens of the Collateral Agent for the benefit of the Lenders in the
assets of the Loan Parties which are parties thereto.

6.12 Sale of Assets.

 
(i)
The Borrower will not, nor will it permit any Subsidiary (other than the
Excluded Subsidiaries (including, without limitation, the sale of the assets and
facilities commonly known as Hollywood Park)) to, lease, sell or otherwise
dispose of its Property to any other Person, except:

(a)  
Sales of inventory in the ordinary course of business.

(b)  
Leases, sales or other dispositions of its Property (including ownership
interests in Guarantors described in Subsection 6.12(iii)(a) and/or (b)) that,
together with all other Property of the Loan Parties previously leased, sold or
disposed of (other than inventory in the ordinary course of business) as
permitted by this Section, in the aggregate, (1) during the twelve-month period
ending with the month in which any such lease, sale or other disposition occurs,
do not constitute a Twelve Month Substantial Portion of the Property of the Loan
Parties, or (2) from and after the Closing Date does not constitute a Term
Substantial Portion of the Property of the Loan Parties, in each case (subject
to subsection (ii) below); provided that prior to and upon completion of such
lease, sale or other disposition no Default or Unmatured Default would exist,
including after giving effect to such sale, transfer or other disposition.

(c)  
Without regard to, and in addition to the limits of Section 6.12(i)(b), the
sale, transfer or other disposition of the assets of, or ownership interests in,
Ellis Park Race Course and/or Racing Corporation of America, provided that prior
to and upon completion of such sale, transfer or other disposition no Default or
Unmatured Default would exist, including after giving effect to such sale,
transfer or other disposition, and provided further that the full amount of the
cash proceeds realized on such sale, transfer or other disposition are applied
to reduce the Aggregate Outstanding Credit Exposure.

(ii)  
Intentionally Omitted.

(iii)  
(a)    Upon the sale of Property permitted under and in accordance with
Subsection 6.12(i)(c) above, the Agent is hereby authorized by the Lenders to
instruct the Collateral Agent to cause Racing Corporation of America and Ellis
Park Race Course, Inc. to be released from their obligations under the Guaranty
without the need for any further authorization from the Lenders.

 
(b)
Upon consummation of the sale or other disposition of Property that (1) consists
of (A) all of the interests of all Loan Parties in a Guarantor, including,
without limitation, all of the capital stock, LLC or partnership (as applicable)
and other equity interests in that Guarantor, or (B) all of the Property of a
Guarantor, and (2) is permitted under and consummated in accordance with
Subsections 6.12(i)(b) and (ii) above, the Agent is hereby authorized by the
Lenders to instruct the Collateral Agent to cause that particular Guarantor to
be released from its obligations under the Guaranty without the need for any
further authorization from the Lenders, provided that no Default or Unmatured
Default shall exist and be continuing or result from that sale or other
disposition of that Property and/or the release of that Guarantor from its
obligations under the Guaranty.

Notwithstanding the foregoing provisions of this Section 6.12, nothing contained
in this Section 6.12 or this Agreement shall prevent the Borrower nor any other
Loan Party or any Subsidiary from conducting its revenue producing activities in
the ordinary course of its respective business, including, but not limited to,
the (a) leasing or licensing of parking facilities, banquet facilities, boxes,
suites or other facilities to the patrons of the Borrower, each Loan Party and
each Subsidiary (collectively, the "Patrons"), (b) granting of personal suite
licenses to Patrons, (c) granting of licenses to Patrons to use space in the
"marquee village" and other similar facilities, and (d) the license or use for a
fee of simulcast signals, trademarks, copyrights, and other similar assets, and
(e) prepaying and/or forgiving any amounts owed under or canceling the bond or
the Lease issued or entered into in connection with the Master Plan Bond
Transaction.

6.13 Investments and Acquisitions. The Borrower will not, nor will it permit any
other Loan Party to, make or suffer to exist any Investments (including without
limitation, loans and advances to, and other Investments in, Subsidiaries), or
commitments therefor, or to create any Subsidiary or to become or remain a
partner in any partnership or joint venture, or to make any Acquisition of any
Person, except:

(i)  
(a) Cash Equivalent Investments and (b) Permitted Investments.

(ii)  
Any Investment (a) in existence on the date hereof (including without limitation
existing Investments in Subsidiaries) and described in Schedule 1, (b) in any
Subsidiary that is a Loan Party if such Investment is not an Acquisition, and
(c) so long as no Default or Unmatured Default has occurred and is continuing,
in an Excluded Entity that is not an Acquisition if, but only if, the aggregate
amount of all Investments in all Excluded Entities under this clause (ii)(c)
after the date of this Agreement, when aggregated with all of the Acquisitions
and/or Investments under clauses (iii)(d)(4), (iii)(e) and (iii)(f) of this
Section 6.13 made after the date of this Agreement (including such proposed
Investment), shall not exceed 20% of Consolidated Net Worth at the time of the
proposed Investment in such Excluded Entity. The Loan Parties shall demonstrate,
including in appropriate circumstances determined by and acceptable to the
Agent, through representations by the Loan Parties, that they shall be in
compliance with all provisions of this Agreement after giving effect to any
Investment permitted by this clause 6.13 (ii)(c) by delivering, at least five
(5) Business Days prior to making or closing such Investment a certificate in
the form of Exhibit O (each an "Investment Compliance Certificate") evidencing
such compliance.

(iii)  
The Borrower or any Loan Party may effect an Acquisition through a merger,
consolidation or by purchase, lease or otherwise of the capital stock or
ownership interest of another Person, or of Property of another Person (each a
"Permitted Acquisition"), to the extent, but only to the extent, such Loan Party
shall have complied with all of the applicable following provisions:

(a)  
In the case of a Permitted Acquisition by the Borrower, the Borrower shall be
the surviving entity in any merger or consolidation.

(b)  
At least thirty (30) Business Days before the date of the proposed Acquisition,
the Borrower shall have delivered to the Agent a notice of acquisition
substantially in the form of Exhibit F attached hereto (a "Notice of
Acquisition") describing in detail the proposed Acquisition.

(c)  
(1) Such Person is either (A) an existing Guarantor or (B) has executed a
Guarantor Joinder to join this Agreement as a Guarantor pursuant to Section
9.14, or shall have done so on or before the date of such Permitted Acquisition,
or, (2) in the alternative, upon request provided in the Notice of Acquisition
of the Loan Party acquiring such Person, on or before the date of closing of
such Permitted Acquisition, the Required Lenders shall have consented, in their
discretion, in writing, to permit such acquired Person to be an Excluded Entity.

(d)  
If the Person to be acquired is not to be an Excluded Entity, then clauses (1),
(2), (3) and (4) of this subsection apply:

(1)  
The Loan Party which acquires such ownership interest in such Person shall
pledge such ownership interests to the Collateral Agent pursuant to the Pledge
and Security Agreement and Section 9.14 on or before the date of the closing of
such Permitted Acquisition, except as provided in clauses (iii)(d)(3) or
(iii)(e) below; and such Person shall, on or before the date of the closing of
such Permitted Acquisition execute and deliver a Guarantor Joinder and otherwise
comply with the requirements of Section 9.14;

(2)  
No Default or Unmatured Default shall exist prior to and/or after giving effect
to such Permitted Acquisition;

(3)  
If such Person is engaged in a Current Field of Enterprise and applicable laws
relating to horse racing or gaming prohibit the pledge of the ownership
interests of such Person or the grant of Liens in one or more assets of such
Person (such stock and assets, collectively, the "Restricted Assets"), such
Person and its owners shall not be obliged to grant Liens in the Restricted
Assets, provided that the Loan Parties shall use their best efforts with respect
to the matters within their respective control to obtain, within ninety (90)
days after the date of such Permitted Acquisition (A) the consent of the
applicable regulatory authority to the pledge or grant of first and prior Liens
in the Restricted Assets of such Person to the Collateral Agent, or (B) the
acknowledgement by such regulatory authority that such a pledge or grant of
security interests does not require such consent; and the applicable Loan
Parties shall within ten (10) days after receiving any such acknowledgement or
consent take all steps necessary or appropriate to pledge and grant first and
prior Liens, other than Permitted Liens, in favor of the Collateral Agent in, as
applicable, the Restricted Assets pursuant to the Pledge and Security Agreement
and any other applicable Collateral Documents, other Loan Documents, and/or
other documents in the form of the Collateral Documents except for the name of
the applicable Loan Party and the description of the Property; and

(4)  
If such Person is not engaged in a Current Field of Enterprise, the aggregate
consideration paid for the Acquisition of and Investment in that Person,
together with all other Acquisitions under this clause (iii)(d)(4) previous to
the Acquisition in question, when aggregated with all of the Investments under
clause(ii)(c) and Acquisitions under clauses (iii)(e) and (iii)(f) of this
Section 6.13, shall not exceed 20% of Consolidated Net Worth at the time of the
proposed Acquisition of such Person.

(e)  
If the acquired Person is to be an Excluded Entity, then clauses (1), (2), (3)
and (4) of this subsection apply:

(1)  
The board of directors or other equivalent governing body of such Person shall
have approved such Permitted Acquisition and, if the Loan Parties shall use any
portion of the Loans to fund such Permitted Acquisition, the Loan Parties shall
also have delivered to the Lenders written evidence of the approval of the board
of directors (or equivalent body) of such Person for such Permitted Acquisition;

(2)  
No Default or Unmatured Default shall exist prior to and/or after giving effect
to such Permitted Acquisition;

(3)  
The Loan Parties shall have delivered to the Agent at least five (5) Business
Days before such Permitted Acquisition copies of any agreements entered into or
proposed to be entered into by such Loan Parties in connection with such
Permitted Acquisition and shall deliver to the Agent for its review such other
information about such Person or its Property as the Agent may reasonably
require; and

(4)  
The aggregate consideration paid for the Acquisition of and Investment in all
Persons pursuant to this clause (iii)(e) of this Section 6.13, when aggregated
with all other consideration paid for the Acquisition of and Investments in any
Person under this clause (iii)(e) and when aggregated with all Investments under
clause (ii)(c) and all Acquisitions under clauses (iii)(d)(4) and (iii)(f) of
this Section, shall not exceed 20% of Consolidated Net Worth at the time of the
Proposed Acquisition of such Person.

(f)  
If the Permitted Acquisition is through purchase, lease or other acquisition of
Property of a Person by a Loan Party, then clauses (1), (2) and (3) of this
subsection apply:

(1)  
No Default or Unmatured Default shall exist prior to and/or after giving effect
to such Permitted Acquisition.

(2)  
That Loan Party shall pledge such Property pursuant to the Pledge and Security
Agreement and/or Mortgage(s), as appropriate, and Section 6.29, unless such Loan
Party is engaged in a Current Field of Enterprise and applicable laws relating
to horse racing or gaming cause the Property, or some part of it, being acquired
to be Restricted Assets, in which case such Loan Party shall not be obliged to
grant Liens in the Restricted Assets, provided that the Loan Parties shall use
their best efforts with respect to the matters within their respective control
to obtain, within ninety (90) after the date of such Permitted Acquisition (A)
the consent of the applicable regulatory authority to the pledge or grant of
first and prior Liens, other than Permitted Liens, in the Restricted Assets of
such Loan Party to the Collateral Agent, or (B) the acknowledgement by such
regulatory authority that such a pledge or grant of security interests does not
require such consent, and that Loan Party shall within ten (10) days after
receiving any such acknowledgement or consent take all steps necessary or
appropriate to pledge and grant first and prior Liens, other than Permitted
Liens, in favor of the Collateral Agent in, as applicable, the Restricted Assets
pursuant to the Pledge and Security Agreement and any other applicable
Collateral Documents, other Loan Documents, and/or documents consistent with the
Collateral Documents.

 

(3)  
If that Loan Party is not engaged in a Current Field of Enterprise both before
and after the Permitted Acquisition, the aggregate consideration paid for the
Acquisition of Property of such Person by such Loan Party pursuant to this
clause (iii)(f) of this Section 6.13, when aggregated with all other
consideration paid for the Investment in any Person under clause (ii)(c) and
when further aggregated with all other Acquisitions and Investments under
clauses (iii)(d)(4) and (iii)(e) of this Section, shall not exceed 20% of
Consolidated Net Worth at the time of the proposed Acquisition of such Property.

(g)  
The Loan Parties shall demonstrate, including, in appropriate circumstances
determined by and acceptable to the Agent, through representations by the Loan
Parties, that they shall be in compliance with (i) the covenants contained in
Sections 6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.16, 6.18, 6.19, 6.23, 6.24, 6.25,
6.26, 6.30, 6.32, 6.33 and 6.34 (including in such computation Indebtedness,
Contingent Obligations, Sale and Leaseback Transactions and all other
liabilities and/or obligations assumed or incurred by a Loan Party or such
Person in connection with such Permitted Acquisition), and (ii) all other
provisions of this Agreement after giving effect to any Permitted Acquisition,
by delivering at least five (5) Business Days prior to such Permitted
Acquisition a certificate in the form of Exhibit M hereto (each an “Acquisition
Compliance Certificate”) evidencing such compliance.

6.14 Subsidiaries. Each Loan Party shall not, and shall not permit any of its
Subsidiaries to, own or create, directly or indirectly, any Subsidiaries other
than (a) any Subsidiary on the Closing Date, and (b) any Subsidiary formed or
acquired after the Closing under this Agreement pursuant to a Permitted
Acquisition. Unless the Subsidiary so acquired is an Excluded Entity with
respect to which the Loan Parties have complied with Section 6.13, such newly
formed or acquired Subsidiary and the applicable Loan Party, as applicable,
shall grant and cause to be perfected first and prior Liens (other than
Permitted Liens) in favor of the Collateral Agent in the assets held by, and
stock of or other ownership interest in, such Subsidiary, subject to Section
6.13(iii)(d)(3). Except as otherwise permitted under Section 6.13 of this
Agreement, each of the Loan Parties shall not become or agree to become (1) a
general or limited partner in any general or limited partnership, except that
Loan Parties may be general or limited partners in other Loan Parties, (2)
become a member or manager of, or hold a limited liability company interest in,
a limited liability company, except that the Loan Parties may be members or
managers of, or hold limited liability company interest in, other Loan Parties,
or (3) become a joint venturer or hold a joint venture interest in any joint
venture.

6.15  Certain Transactions. Except for the Sale and Leaseback Transaction that
is a part of the Master Plan Bond Transaction, the Borrower and the other Loan
Parties collectively, in the aggregate, may not incur Indebtedness under
Sections 6.10(x) or Off Balance Sheet Liabilities under Section 6.23 (ii),
which, at any one time, aggregate for the Borrower and all of the other Loan
Parties, collectively, in an amount more than $40,000,000.00.

6.16  Liens. The Borrower will not, nor will it permit any Subsidiary to,
create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except (collectively, "Permitted Liens"):

(i)  
Liens for taxes, assessments or governmental charges or levies on such Loan
Party's Property if the same shall not at the time be delinquent or thereafter
can be paid without penalty, or are being contested in good faith and by
appropriate proceedings and for which adequate reserves in accordance with
Agreement Accounting Principles shall have been set aside on such Loan Party's
books.

(ii)  
Liens imposed by law, such as carriers', warehousemen's and mechanics' liens and
other similar Liens arising in the ordinary course of business which secure
payment of obligations not more than sixty (60) days past due or which are being
contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with Agreement Accounting Principles shall have been set
aside on such Loan Party's books.

(iii)  
Liens arising out of pledges or deposits under worker's compensation laws,
unemployment insurance, old age pensions, or other social security or retirement
benefits, or similar legislation.

(iv)  
Utility easements, building restrictions and such other encumbrances or charges
against real property as are of a nature generally existing with respect to
properties of a similar character and which do not in any material way affect
the marketability of the same or interfere with the use thereof in the business
of the Borrower or its Subsidiaries.

(v)  
Liens existing on the date hereof and described in Schedule 2 and any Lien filed
or which arises, at any time solely against Property of any Excluded Subsidiary.

(vi)  
Liens in favor of the Collateral Agent, for the benefit of the Lenders, granted
pursuant to any Collateral Document.

(vii)  
Liens, security interests and mortgages for the benefit of any individual Lender
which provides a Rate Management Transaction permitted under Section 6.22 (each
a "Permitted Secured Lender Rate Management Transaction") between one or more of
the Loan Parties and such Lender, provided that any such Liens shall be pari
passu with the Liens securing the other Secured Obligations hereunder. The
parties to a "Permitted Secured Rate Management Transaction" shall state in the
documentation governing such agreement that such agreement is intended to be a
"Permitted Secured Rate Management Transaction" hereunder, and upon doing so
such agreement shall be treated as a "Permitted Secured Rate Management
Transaction" for all purposes hereunder and under each of the other Loan
Documents and such agreement shall be entitled to share in the Collateral as
more fully provided for herein and therein.

(viii)  
Liens created in connection with assets leased under Capitalized Leases
described in and permitted under Section 6.10(v).

(ix)  
Purchase money security interests described in and permitted under Section
6.10(iv).

(x)  
So long as, (A)  the validity or amount thereof is being contested in good faith
by appropriate and lawful proceedings diligently conducted and so long as levy
and execution thereon have been stayed and continue to be stayed or (B) if a
final judgment is entered, such judgment is discharged within thirty (30) days
of entry, and in either case they do not in the aggregate, materially impair the
ability of the Borrower to perform its Obligations hereunder and under the other
Loan Documents, then the following:

(a)  
Claims or Liens for taxes, assessments or charges due and payable and subject to
interest or penalty, provided that the applicable Loan Party maintains such
reserves or other appropriate provisions as shall be required by Agreement
Accounting Principles and pays all such taxes, assessments or charges forthwith
upon the commencement of proceedings to foreclose any such Lien provided that,
notwithstanding any such reserves, the Loan Parties shall pay any Liens related
to recording or related taxes (including documentary stamp taxes or intangible
taxes), immediately upon the existence of any Default or immediately upon the
request of the Agent if the Collateral Agent has recorded or is recording a
Mortgage with respect to such realty;

(b)  
Claims, Liens or encumbrances upon, and defects of title to, real or personal
property other than the Collateral, including any attachment of personal or real
property or other legal process prior to adjudication of a dispute on the
merits;

(c)  
Claims or Liens of mechanics, materialmen, warehousemen, carriers, or other
statutory nonconsensual Liens; or

(d)  
Claims or Liens resulting from judgments or orders which, in the aggregate, do
not exceed $5,000,000.00.

(xi)  
Liens permitted under the title policies referred to in Section 4.1(i) hereof.

6.17 Intentionally Omitted.

6.18 Rentals. The Borrower will not, nor will it permit any Loan Party to,
create, incur or suffer to exist obligations for Consolidated Rentals in excess
of $10,000,000.00 in any one fiscal year for the Borrower and its Subsidiaries
in the aggregate.

6.19 Affiliates. The Borrower will not, and will not permit any Subsidiary to,
enter into any transaction (including, without limitation, the purchase or sale
of any Property or service) with, or make any payment or transfer to, any
Affiliate except (i) in the ordinary course of business and pursuant to the
reasonable requirements of the Borrower's or such Subsidiary's business and (ii)
upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary than the Borrower or such Subsidiary would obtain in a comparable
arms-length transaction.

6.20 No Prepayment of Material Indebtedness. The Loan Parties shall not, nor
will any of them permit any Subsidiary to, prepay, anticipate, defease,
purchase, redeem or acquire any Material Indebtedness (other than Obligations
hereunder), either in whole or in part, directly or indirectly, prior to the
scheduled maturity thereof, except for payment of regularly scheduled
installments of principal and/or interest thereon as and when those installments
come due in the regular course, and not by acceleration thereof, provided that
nothing in this Section 6.20 shall prohibit an Excluded Subsidiary to prepay any
Indebtedness with respect to which it, but not any Loan Party, is obligated.

6.21 Recordation of Calder Mortgage. The Agent may, and at the direction of the
Required Lenders shall, direct the Collateral Agent to record the Calder
Mortgage; and appropriate UCC fixture filings. The other financing statements
for filing in Florida (the “Calder Financing Statements”) have been filed
concurrently with the Previous Closing Date. The Loan Parties shall take all
such steps as the Agent, the Collateral Agent or the Required Lenders request
and shall otherwise cooperate in connection with the recordation of the Calder
Mortgage, and related documents pursuant to the preceding sentence, including
(i) obtaining title insurance for the benefit of the Collateral Agent and the
Lenders in an amount not less than the appraised value of the property covered
by such Calder Mortgage (which the Loan Parties shall be required to pay for)
and (ii) if a Default exists at the time of such recordation or if a Default
should occur following such recordation, the Loan Parties shall pay (or
reimburse the Agent for) all documentary stamp taxes, intangible asset taxes or
other fees and expenses associated with such recordation. The Calder Mortgage
shall be treated as a "Recorded Mortgage" for purposes of this Agreement
including the warranty in Section 5.14 relating to the Recorded Mortgages.
 
6.22 Financial Contracts. The Borrower has entered into the transactions of the
type described in the definition of “Rate Management Transactions” described on
Schedule 6.22, and may enter into one or more transactions of the type described
in the definition of "Rate Management Transactions" with one or more of the
Lenders after the date of this Agreement, but the Borrower shall not, nor will
it permit any Subsidiary to enter into or remain liable under any Financial
Contract that is speculative in nature.

6.23 Sale and Leaseback Transactions and other Off-Balance Sheet Liabilities.
The Borrower will not, nor will it permit any Subsidiary to, enter into or
suffer to exist any (i) Sale and Leaseback Transaction except the Sale and
Leaseback Transaction that is a part of the Master Plan Bond Transaction or (ii)
any other transaction pursuant to which it incurs or has incurred Off-Balance
Sheet Liabilities, except for (a) Rate Management Obligations permitted to be
incurred under the terms of Section 6.22 and (b) as provided in Section 6.15.

6.24 Financial Covenants.

6.24.1 Interest Coverage Ratio. The Borrower will maintain the Interest Coverage
Ratio, determined as of the end of each of its fiscal quarters for the then
most-recently ended four fiscal quarters, of (i) Consolidated Adjusted EBITDA,
to (ii) Consolidated Interest Expense, all calculated for the Loan Parties on a
consolidated basis and in accordance with Agreement Accounting Principles, to be
greater than 3.5 to 1.0.

6.24.2 Leverage Ratio. The Borrower will not permit the Leverage Ratio,
determined as of the end of each of its fiscal quarters, of (i) Consolidated
Funded Indebtedness to (ii) Consolidated Adjusted EBITDA for the then
most-recently ended four fiscal quarters to be greater than 3.25 to 1.0.

6.24.3 Minimum Net Worth. The Borrower will at all times maintain Consolidated
Net Worth of not less than (a) $190,000,000 as of the Closing Date, and (b)
beginning with Borrower's fiscal year ending December 31, 2005, the sum of (i)
$190,000,000 plus (ii) 50% of Consolidated Net Income earned in each fiscal year
(without deduction for losses), plus (iii) 100% of the proceeds from any public
and/or private offering and/or sale of any common and/or preferred stock and/or
other equity security, and/or any note, debenture, or other security
convertible, in whole or in part, to common and/or preferred stock and/or other
equity security, net of reasonable expenses, commissions and fees associates
with such sale, from and after the date of this Agreement.

6.25 Loan Parties shall enter into Collateral Documents. The Borrower and each
of the other Loan Parties shall grant to the Collateral Agent, for the benefit
of the Lenders, a first priority perfected security interest in all of the
Property of the Borrower and each of the Loan Parties, provided that (i)
recordation of the Calder Mortgage and UCC fixture filings for filing in Florida
may be delayed pursuant to and in accordance with Section 6.21, and (ii) Racing
Corporation of America, Churchill Downs Simulcast Productions, LLC, Charlson
Industries, Inc. and Ellis Park Race Course, Inc. shall not, so long as the
assets of such Subsidiaries are not pledged or otherwise subject to any lien for
the benefit of any other creditors, be required to execute or deliver any
Collateral Document other than the Guaranty. To that end, each of the Loan
Parties shall duly authorize, execute and promptly deliver the Guaranty to the
Agent and deliver to the Collateral Agent the Mortgages, the Pledge and Security
Agreement, the Assignments of Patents, Trademarks and Copyrights, the
Intercompany Subordination Agreement and any and all other Collateral Documents,
including without limitation all documents or instruments necessary or
appropriate to create and/or perfect or otherwise protect the Liens in the
Collateral in favor of the Collateral Agent for the benefit of the Lenders.

6.26 Maintenance of Patents, Trademarks, Etc. Each Loan Party shall, and shall
cause each of its Subsidiaries (except for the Excluded Subsidiaries) to,
maintain in full force and effect all patents, trademarks, service marks, trade
names, copyrights, licenses, franchises, permits and other authorizations
necessary for the ownership and operation of its properties and business if the
failure so to maintain the same would constitute a Material Adverse Effect.
 
6.27 Plans and Benefit Arrangements. The Borrower shall, and shall cause each
other member of the Controlled Group to, comply with ERISA, the Code and other
applicable Laws applicable to Plans, or Benefit Arrangements except where such
failure, alone or in conjunction with any other failure, would not result in a
Material Adverse Effect. Without limiting the generality of the foregoing, the
Borrower shall make, and cause each member of the Controlled Group to make, in a
timely manner, all contributions due to Plans, Benefit Arrangements and
Multiemployer Plans.
 
6.28 Compliance with Laws. Each Loan Party shall, and shall cause each of its
Subsidiaries to, comply with all applicable all applicable statutes, rules,
regulations, orders and restrictions of any domestic or foreign government or
any instrumentality or agency thereof having jurisdiction over the conduct of
their respective businesses or the ownership of their respective Property,
including all Environmental Laws, in all respects, provided that it shall not be
deemed to be a violation of this Section 6.28 if any failure to comply with any
of the foregoing would not result in fines, penalties, remediation costs, other
similar liabilities or injunctive relief which in the aggregate would constitute
a Material Adverse Effect.
 
6.29 Further Assurances. Each Loan Party shall, from time to time, at its
expense, (i) take such steps as may be necessary and/or appropriate to
faithfully preserve and protect the Lien in favor of the Collateral Agent, for
the benefit of the Lenders, on and security interest in the Collateral more
fully described in the Collateral Documents as a continuing first priority
perfected Lien, subject only to Permitted Liens, (ii) shall do such other acts
and things as the Agent in its sole discretion may deem necessary or advisable
from time to time in order to preserve, perfect and protect the Liens granted
under the Loan Documents and to exercise and enforce its rights and remedies
thereunder with respect to the Collateral (including without limitation the
execution and/or delivery of such amendments and supplements to the Collateral
Documents and related instruments and documents to the extent, and within such
time periods, as are reasonably requested by the Collateral Agent), and (iii) as
Property is acquired and as required by the other provisions of this Agreement,
enter into additional documents from time to time in the form of the Collateral
Documents (except as to the applicable Loan Party and the Property subject
thereto) and take such other steps to grant and perfect first priority Liens on
those assets to the Collateral Agent, for the benefit of the Lenders.
 
6.30 Subordination of Intercompany Loans. Each Loan Party shall cause any
intercompany Indebtedness, and loans or advances owed by any Loan Party to any
other Loan Party to be subordinated pursuant to the terms of the Intercompany
Subordination Agreement.
 
6.31 Plans and Benefit Arrangements. Each of the Loan Parties shall not, and
shall not permit any of its Subsidiaries to:
 

(i)  
engage in a Prohibited Transaction with any Plan, Benefit Arrangement or
Multiemployer Plan which, alone or in conjunction with any other circumstances
or set of circumstances resulting in liability under ERISA, would constitute a
Material Adverse Effect;

 

(ii)  
fail to make when due any contribution to any Multiemployer Plan that the
Borrower or any member of the Controlled Group may be required to make under any
agreement relating to such Multiemployer Plan, or any Law pertaining thereto;

 

(iii)  
withdraw (completely or partially) from any Multiemployer Plan where any such
withdrawal is likely to result in a material liability under Section 4063 of
ERISA of the Borrower or any member of the Controlled Group that would
constitute a Material Adverse Effect;

 

(iv)  
terminate, or institute proceedings to terminate, any Plan, where such
termination is likely to result in a material liability to the Borrower or any
member of the Controlled Group that would constitute a Material Adverse Effect;

 

(v)  
make any amendment to any Plan with respect to which security is required under
Section 307 of ERISA;

 

(vi)  
fail to give any and all notices and make all disclosures and governmental
filings required under ERISA or the Code, where such failure is likely to result
in a Material Adverse Effect; or

 

(vii)  
create or enter into any Plan subject to the minimum funding requirements of
ERISA, without the prior written consent of the Required Lenders.

 
6.32 Issuance of Stock. Except as may be permitted in Section 6.13, each of the
Loan Parties other than the Borrower shall not issue any additional shares of
such Loan Party's capital stock or any options, warrants or other rights in
respect thereof to any Person not a Loan Party, provided that the Borrower shall
deliver stock powers and the original certificates evidencing such new shares in
such Loan Party and shall take any other steps necessary to grant security
interests in such shares in favor of the Collateral Agent prior to issuing such
shares.
 
6.33 Changes in Organizational Documents. Except as provided in the next
sentence, each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, amend in any respect its certificate of incorporation
(including any provisions or resolutions relating to capital stock), by-laws,
certificate of limited partnership, partnership agreement, articles or
certificate of formation, limited liability company agreement or other
organizational documents without providing at least ten (10) calendar days'
prior written notice to the Agent and, in the event such change would be
materially adverse to the Lenders as determined by the Agent in its sole
discretion, obtaining the prior written consent of the Required Lenders. The
Borrower may amend its articles of incorporation to do any or all of the
following: (1) in connection with a public offering of shares of its capital
stock to provide for an increase in the number of authorized shares of such
stock or (2) in connection with such a public offering to increase the total
number of shares issuable as Series 1998 Preferred Stock to reflect the increase
in the number of shares of the Borrower's common stock outstanding, and (3)
delete any provisions related to cumulative voting by shareholders in the
election or removal of directors.
 
6.34 Contingent Obligations. The Borrower will not, nor will it permit any
Subsidiary (except for the Excluded Subsidiaries) to, make or suffer to exist
any Contingent Obligation (including, without limitation, any Contingent
Obligation with respect to the obligations of a Subsidiary), except (i) by
endorsement of instruments for deposit or collection in the ordinary course of
business, (ii) the Reimbursement Obligations, (iii) for the Guaranty; (iv) for
PSL Buyback/Guarantee(s) not to exceed $20,000,000 at any one time in the
aggregate for all such PSL Buyback/Guarantees; (v) guaranties of the obligations
of Loan Parties not to exceed $10,000,000 at any one time in the aggregate for
all such guaranties; and (vi) potential withdrawal liability under Multiemployer
Plans related to the Hollywood Park operation in an aggregate amount not to
exceed $10,000,000.

6.35 Other Agreements. The Loan Parties will not enter into any agreement
containing any provision which would be violated or breached by the performance
of their obligations hereunder or under any instrument or document delivered or
to be delivered by them hereunder or in connection herewith.

6.36 Preservation of Existence. Each Loan Party shall, and shall cause each of
its Subsidiaries (other than the Excluded Subsidiaries) to maintain its legal
existence as a corporation, limited partnership or limited liability company and
its license or qualification and good standing in each jurisdiction in which its
ownership or lease of property or the nature of its business makes such license
or qualification necessary, except (i) as otherwise may be expressly be
permitted in Sections 6.11, 6.12. 6.13 and/or 6.14, (ii) upon a sale of Ellis
Park Race Course, Inc., Racing Corporation of America, or their respective
assets as contemplated in Section 6.12(i)(c), Racing Corporation of America
and/or Ellis Park Race Course, Inc. would no longer be subject to the
requirements and/or limitations of this Section 6.36, and (iii) where such
failure to do so shall not have a Material Adverse Effect.

ARTICLE VII

DEFAULTS

The occurrence of any one or more of the following events shall constitute a
Default:

7.1  Any representation or warranty made or deemed made by or on behalf of the
Loan Parties to the Lenders or the Agent under or in connection with this
Agreement, any Credit Extension, or any certificate or information delivered in
connection with this Agreement or any other Loan Document shall be materially
false on the date as of which made.
 
7.2  Nonpayment of principal of any Loan when due, or nonpayment of any
Reimbursement Obligation in or of any interest upon any Loan or Reimbursement
Obligation within one Business Day after the same becomes due, or of any
commitment fee, LC Fee or other obligations under any of the Loan Documents
within five days after the same becomes due.
 
7.3  The breach by the Borrower and/or any Loan Party of any of the terms or
provisions of Sections 6.2, 6.3, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.16, 6.18,
6.19, 6.20, 6.22, 6.23, 6.24, 6.25, 6.26, 6.27, 6.28, 6.29, 6.30, 6.31, 6.32,
6.33, 6.34, 6.35 and/or 6.36.
 
7.4  The breach by the Borrower and/or any Loan Party (other than a breach which
constitutes a Default under another Section of this Article VII) of any of the
terms or provisions of this Agreement and/or any other Loan Document which is
not remedied within five days after written notice from the Agent or any Lender.
 
7.5  Failure of the Borrower or any of the other Loan Parties to pay when due
any Material Indebtedness; or the default by the Borrower or any of the other
Loan Parties in the performance (beyond the applicable grace period with respect
thereto, if any) of any term, provision or condition contained in any Material
Indebtedness Agreement, or any other event shall occur or condition exist, the
effect of which default, event or condition is to cause, or to permit the
holder(s) of such Material Indebtedness or the lender(s) under any Material
Indebtedness Agreement to cause, such Material Indebtedness to become due prior
to its stated maturity or any commitment to lend under any Material Indebtedness
Agreement to be terminated prior to its stated expiration date; or any Material
Indebtedness of the Borrower or any of the other Loan Parties shall be declared
to be due and payable or required to be prepaid or repurchased (other than by a
regularly scheduled payment) prior to the stated maturity thereof; or the
Borrower or any of its Subsidiaries or any Guarantor shall not pay, or admit in
writing its inability to pay, its debts generally as they become due.
 
7.6  The Borrower or any of the other Loan Parties shall (i) have an order for
relief entered with respect to it under the Federal bankruptcy laws as now or
hereafter in effect, (ii) make an assignment for the benefit of creditors, (iii)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any Term
Substantial Portion or Twelve Month Substantial Portion of its Property, (iv)
institute any proceeding seeking an order for relief under the Federal
bankruptcy laws as now or hereafter in effect or seeking to adjudicate it a
bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief of
debtors or fail to file an answer or other pleading denying the material
allegations of any such proceeding filed against it, (v) take any corporate or
partnership action to authorize or effect any of the foregoing actions set forth
in this Section 7.6 or (vi) fail to contest in good faith any appointment or
proceeding described in Section 7.7.
 
7.7  Without the application, approval or consent of the Borrower or any of the
other Loan Parties, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of the other Loan Parties or
any Term Substantial Portion or Twelve Month Substantial Portion of its
Property, or a proceeding described in Section 7.6(iv) shall be instituted
against the Borrower or any of the other Loan Parties and such appointment
continues undischarged or such proceeding continues undismissed or unstayed for
a period of 60 consecutive days.
 
7.8  Any court, government or governmental agency shall condemn, seize or
otherwise appropriate, or take custody or control of, all or any portion of the
Property of any of the Loan Parties which, when taken together with all other
Property of the Loan Parties so condemned, seized, appropriated, or taken
custody or control of, during the twelve-month period ending with the month in
which any such action occurs, constitutes a Term Substantial Portion or Twelve
Month Substantial Portion.
 
7.9  The Borrower or any of the other Loan Parties shall fail within thirty (30)
days to pay, bond or otherwise discharge one or more (i) judgments or orders for
the payment of money in excess of $5,000,000.00 (or the equivalent thereof in
currencies other than U.S. Dollars) in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, which judgment(s), in any such case,
is/are not stayed on appeal or otherwise being appropriately contested in good
faith.
 
7.10  Nonpayment by the Borrower or any Loan Party of any Rate Management
Obligation when due or the breach by the Borrower or any Subsidiary of any term,
provision or condition contained in any Rate Management Transaction or any
transaction of the type described in the definition of "Rate Management
Transactions," whether or not any Lender or Affiliate of a Lender is a party
thereto.
 
7.11  Any Change in Control shall occur.
 
7.12  The Borrower or any other member of the Controlled Group shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred withdrawal
liability to such Multiemployer Plan in an amount which, when aggregated with
all other amounts required to be paid to Multiemployer Plans by the Borrower or
any other member of the Controlled Group as withdrawal liability (determined as
of the date of such notification), exceeds $10,000,000.00 or requires payments
exceeding $10,000,000.00 per annum.
 
7.13  The Borrower or any other member of the Controlled Group shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, if as a result of such reorganization or termination the aggregate annual
contributions of the Borrower and the other members of the Controlled Group
(taken as a whole) to all Multiemployer Plans which are then in reorganization
or being terminated have been or will be increased over the amounts contributed
to such Multiemployer Plans for the respective plan years of each such
Multiemployer Plan immediately preceding the plan year in which the
reorganization or termination occurs by an amount exceeding $10,000,000.00.
 
7.14  The Borrower or any of the other Loan Parties shall (i) be the subject of
any proceeding or investigation pertaining to the release by the Borrower, any
of the other Loan Parties or any other Person of any toxic or hazardous waste or
substance into the environment, or (ii) violate any Environmental Law, which, in
the case of an event described in clause (i) or clause (ii), could reasonably be
expected to have a Material Adverse Effect.
 
7.15  The occurrence of any "default," as defined in any Loan Document (other
than this Agreement) or the breach of any of the terms or provisions of any Loan
Document (other than this Agreement), which default or breach continues beyond
any period of grace therein provided.
 
7.16  Any Guaranty shall fail to remain in full force or effect or any action
shall be taken to discontinue or to assert the invalidity or unenforceability of
any Guaranty, or any Guarantor shall fail to comply with any of the terms or
provisions of any Guaranty to which it is a party, or any Guarantor shall deny
that it has any further liability under any Guaranty to which it is a party, or
shall give notice to such effect.
 
7.17  Any Collateral Document shall for any reason fail to create a valid and
perfected first priority security interest in any Collateral purported to be
covered thereby, except as permitted by the terms of any Collateral Document, or
any Collateral Document shall fail to remain in full force or effect or any
action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Collateral Document, or the Borrower shall fail to
comply with any of the terms or provisions of any Collateral Document.
 
7.18  The representations and warranties set forth in Section 5.15 (Plan Assets;
Prohibited Transactions) shall at any time not be true and correct.
 
7.19  The Borrower or any Loan Party shall fail to pay when due any Operating
Lease Obligation, obligation with respect to a Letter of Credit, obligation
under a Sale and Leaseback Transaction or Contingent Obligation which in any of
those cases involves a Material Indebtedness.
 
7.20  Intentionally Omitted.
 
7.21  The occurrence of any default under or breach of any of the terms or
provisions of the applicable documents in the Master Plan Bond Transaction,
which default or breach continues beyond any period of grace therein provided.
 
ARTICLE VIII

ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

8.1 Acceleration; Facility LC Collateral Account.

(i)  
If any Default described in Section 7.6 or 7.7 occurs with respect to the
Borrower, the obligations of the Lenders to make Loans hereunder and the
obligation and power of the LC Issuer to issue Facility LCs shall automatically
terminate and the Obligations shall immediately become due and payable without
any election or action on the part of the Agent, the Collateral Agent, the LC
Issuer or any Lender and the Borrower will be and become thereby unconditionally
obligated, without any further notice, act or demand, to pay to the Collateral
Agent an amount in immediately available funds, which funds shall be held in the
Facility LC Collateral Account, equal to the difference of (x) the amount of LC
Obligations at such time, less (y) the amount on deposit in the Facility LC
Collateral Account at such time which is free and clear of all rights and claims
of third parties and has not been applied against the Obligations (such
difference, the "Collateral Shortfall Amount"). If any other Default occurs, the
Required Lenders (or the Agent with the consent of the Required Lenders) may (a)
terminate or suspend the obligations of the Lenders to make Loans hereunder and
the obligation and power of the LC Issuer to issue Facility LCs, or declare the
Obligations to be due and payable, or both, whereupon the Obligations shall
become immediately due and payable, without presentment, demand, protest or
notice of any kind, all of which the Borrower hereby expressly waives, and (b)
upon notice to the Borrower and in addition to the continuing right to demand
payment of all amounts payable under this Agreement, make demand on the Borrower
to pay, and the Borrower will, forthwith upon such demand and without any
further notice or act, pay to the Collateral Agent the Collateral Shortfall
Amount, which funds shall be deposited in the Facility LC Collateral Account.

(ii)  
If at any time while any Default is continuing, the Agent determines that the
Collateral Shortfall Amount at such time is greater than zero, the Agent may
make demand on the Borrower to pay, and the Borrower will, forthwith upon such
demand and without any further notice or act, pay to the Collateral Agent the
Collateral Shortfall Amount, which funds shall be deposited in the Facility LC
Collateral Account.

(iii)  
The Collateral Agent may at any time or from time to time after funds are
deposited in the Facility LC Collateral Account, apply such funds to the payment
of the Obligations and any other amounts as shall from time to time have become
due and payable by the Borrower to the Lenders or the LC Issuer.

(iv)  
At any time while any Default is continuing, neither the Borrower nor any Person
claiming on behalf of or through the Borrower shall have any right to withdraw
any of the funds held in the Facility LC Collateral Account. After all of the
Obligations have been indefeasibly paid in full and the Aggregate Commitment has
been terminated, any funds remaining in the Facility LC Collateral Account shall
be distributed to Borrower or paid to whomever may be legally entitled thereto
at such time.

(v)  
If, within 30 days after acceleration of the maturity of the Obligations or
termination of the obligations of the Lenders to make Loans and the obligation
and power of the LC Issuer to issue Facility LCs hereunder as a result of any
Default (other than any Default as described in Section 7.6 or 7.7 with respect
to the Borrower) and before any judgment or decree for the payment of the
Obligations due shall have been obtained or entered, the Required Lenders (in
their sole discretion) shall so direct, the Agent shall, by notice to the
Borrower, rescind and annul such acceleration and/or termination.

 
(vi)  
The Collateral Agent shall have the right to exercise the remedies and other
rights with respect to the Collateral provided in and subject to the Collateral
Documents.

8.2 Amendments. Subject to the provisions of this Section 8.2, the Required
Lenders (or the Agent with the consent in writing of the Required Lenders) and
the Borrower may enter into agreements supplemental hereto for the purpose of
adding or modifying any provisions to the Loan Documents or changing in any
manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of all of the Lenders:

 
(i)  
Extend the final maturity of any Loan, or extend the expiry date of any Facility
LC to a date after the Facility Termination Date or postpone any regularly
scheduled payment of principal of any Loan or forgive all or any portion of the
principal amount thereof or any Reimbursement Obligation related thereto, or
reduce the rate or extend the time of payment of interest or fees thereon or
Reimbursement Obligation related thereto.

(ii)  
Reduce the percentage specified in the definition of Required Lenders.

(iii)  
Extend the Facility Termination Date, or reduce the amount or extend the payment
date for, the mandatory payments required under Section 2.4, or increase the
amount of the Aggregate Commitment, except as provided in Section 2.22, or of
the Commitment of any Lender hereunder or the commitment to issue Facility LCs,
or permit the Borrower to assign its rights under this Agreement.

(iv)  
Amend this Section 8.2.

(v)  
Release any Guarantor except as provided in Section 6.12(iii) or, except as
provided in the Collateral Documents, agree to subordinate the Lenders' Liens
with respect to all or substantially all of the Collateral.

(vi)  
Release substantially all of the Collateral, provided that the Lenders
acknowledge that the Agent may alone instruct the Collateral Agent to release
any Collateral as and to the extent provided in Section 10.16.

No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent, and no amendment of any
provision relating to the LC Issuer shall be effective without the written
consent of the LC Issuer. The Agent may (i) waive payment of the fee required
under Section 12.3.3 and (ii) implement any flex pricing provisions contained in
the fee letter described in Section 10.13 or any commitment letter delivered in
connection with the transaction which is the subject of this Agreement without
obtaining the consent of any other party to this Agreement so long as, in the
case of any implementation of any flex-pricing provisions, the Agent's actions
would not require consent of all of the Lenders pursuant to the foregoing
provisions of this Section.

8.3 Preservation of Rights. No delay or omission of the Lenders, the LC Issurer,
the Agent or the Collateral Agent to exercise any right under the Loan Documents
shall impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and the making of a Credit Extension notwithstanding the
existence of a Default or the inability of the Borrower to satisfy the
conditions precedent to such Credit Extension shall not constitute any waiver or
acquiescence. Any single or partial exercise of any such right shall not
preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment or other variation of the terms, conditions or
provisions of the Loan Documents whatsoever shall be valid unless in writing
signed by the Lenders required pursuant to Section 8.2, and then only to the
extent in such writing specifically set forth. All remedies contained in the
Loan Documents or by law afforded shall be cumulative and all shall be available
to the Agent, the LC Issuer, the Lenders and the Collateral Agent until the
Secured Obligations have been paid in full.

ARTICLE IX

GENERAL PROVISIONS

9.1 Survival of Representations. All representations and warranties of the
Borrower contained in this Agreement shall survive the making of the Credit
Extensions herein contemplated.

9.2 Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, neither the LC Issuer nor any Lender shall be
obligated to extend credit to the Borrower in violation of any limitation or
prohibition provided by any applicable statute or regulation.

9.3 Headings. Section headings in the Loan Documents are for convenience of
reference only, and shall not govern the interpretation of any of the provisions
of the Loan Documents.

9.4 Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Borrower, the Agent, the Collateral Agent, the LC Issuer
and the Lenders and supersede all prior agreements and understandings among the
Borrower, the Agent, the LC Issuer and the Lenders relating to the subject
matter thereof other than those contained in the fee letter described in Section
10.13 and any flex pricing provisions contained in any commitment letter entered
into in connection with the transactions that are the subject of this Agreement,
all of which survives and remains in full force and effect during the term of
this Agreement.

9.5 Several Obligations; Benefits of this Agreement. The respective obligations
of the Lenders hereunder are several and not joint and no Lender shall be the
partner or agent of any other (except to the extent to which the Agent is
authorized to act as such). The failure of any Lender to perform any of its
obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.

9.6 Expenses; Indemnification.

(i)  
The Borrower shall reimburse the Agent (the term “Agent” in this Section 9.6
also being used to refer to the Agent in its capacity as Collateral Agent) and
J.P. Morgan Securities Inc. for any costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' fees and time charges of attorneys for
the Agent, which attorneys may be employees of the Agent) paid or incurred by
the Agent or the Arranger in connection with the preparation, negotiation,
execution, delivery, syndication, distribution (including, without limitation,
via the internet), review, amendment, modification, and administration of the
Loan Documents. The Borrower also agrees to reimburse the Agent, J.P. Morgan
Securities Inc., the LC Issuer and the Lenders for any costs, internal charges
and out-of-pocket expenses (including reasonable attorneys' fees and time
charges of attorneys for the Agent, J.P. Morgan Securities Inc., the LC Issuer
and the Lenders, which attorneys may be employees of the Agent, J.P. Morgan
Securities Inc., or the Lenders) paid or incurred by the Agent, J.P. Morgan
Securities Inc., the LC Issuer or any Lender in connection with the collection
and enforcement of the Loan Documents. Expenses being reimbursed by the Borrower
under this Section include, without limitation, the cost and expense of
obtaining an appraisal, if any, of any parcel of real property or interest in
real property described in any relevant Collateral Documents which appraisal, if
any, shall be in conformity with the applicable requirements of any law or any
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law), or any interpretation thereof, including, without
limitation, the provisions of Title XI of the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, as amended, reformed or otherwise modified
from time to time, and any rules promulgated to implement such provisions and
costs and expenses incurred in connection with the Reports described in the
following sentence. The Borrower acknowledges that from time to time the Agent
may prepare and may distribute to the Lenders (but shall have no obligation or
duty to prepare or to distribute to the Lenders) certain audit reports (the
"Reports") and/or the Collateral Agent may prepare and distribute Reports to the
Agent (but the Collateral Agent shall have no obligation or duty to prepare or
distribute such Reports, nor shall the Agent have any obligation or duty to
distribute such Reports to the Lenders as it may receive from the Collateral
Agent) pertaining to the Borrower's Property for internal use by the Agent from
information furnished to it by or on behalf of the Borrower, after the Agent or
the Collateral Agent has exercised its rights of inspection pursuant to this
Agreement.

(ii)  
The Borrower hereby further agrees to indemnify the Agent, the Arranger, the LC
Issuer and each Lender, their respective affiliates, and each of their
directors, officers and employees against all losses, claims, damages,
penalties, judgments, liabilities and expenses (including, without limitation,
all expenses of litigation or preparation therefor whether or not the Agent, the
Arranger, the LC Issuer any Lender or any affiliate is a party thereto) which
any of them may pay or incur arising out of or relating to this Agreement, the
other Loan Documents, the transactions contemplated hereby or the direct or
indirect application or proposed application of the proceeds of any Credit
Extension hereunder except to the extent that they are determined in a final
non-appealable judgment by a court of competent jurisdiction to have resulted
from the gross negligence or willful misconduct of the party seeking
indemnification.

(iii)  
The Agent and the Lenders shall not be liable for, and the Loan Parties agree
that they shall immediately pay to the Agent and the Lenders when incurred and
shall indemnify, defend and hold the Lenders harmless from and against, all
loss, cost, liability, damage and expense (including, without limitation,
reasonable attorneys' fees and costs incurred in the investigation, defense and
settlement of claims) that the Agent or the Lenders may suffer or incur as
mortgagees as a result of, or in connection in any way with any applicable
Environmental Laws (including the assertion that any lien existing pursuant to
the Environmental Laws takes priority over the lien or security interests of the
Collateral Agent or Lenders), or any environmental assessment or study from time
to time reasonably undertaken or requested by the Agent or any Lenders or breach
of any covenant or undertaking by the Loan Parties. The obligations of the Loan
Parties under this Section 9.6 shall survive the termination of this Agreement.

9.7 Numbers of Documents. All statements, notices, closing documents, and
requests hereunder shall be furnished to the Agent with sufficient counterparts
so that the Agent may furnish one to each of the Lenders.

9.8 Accounting. Except as provided to the contrary herein, all accounting terms
used herein shall be interpreted and all accounting determinations hereunder
shall be made in accordance with Agreement Accounting Principles, except that
any calculation or determination which is to be made on a consolidated basis
shall be made for the Borrower and the other Loan Parties.

9.9 Severability of Provisions. Any provision in any Loan Document that is held
to be inoperative, unenforceable, or invalid in any jurisdiction shall, as to
that jurisdiction, be inoperative, unenforceable, or invalid without affecting
the remaining provisions in that jurisdiction or the operation, enforceability,
or validity of that provision in any other jurisdiction, and to this end the
provisions of all Loan Documents are declared to be severable.

9.10 Nonliability of Lenders. The relationship between the Borrower on the one
hand and the Lenders, the LC Issuer and the Agent on the other hand shall be
solely that of borrower and lender. Neither the Agent, the Arranger, the LC
Issuer nor any Lender shall have any fiduciary responsibilities to the Borrower.
Neither the Agent, the Arranger, the LC Issuer nor any Lender undertakes any
responsibility to the Borrower to review or inform the Borrower of any matter in
connection with any phase of the Borrower's business or operations. The Borrower
agrees that neither the Agent, the Collateral Agent, the Arranger, the LC Issuer
nor any Lender shall have liability to the Borrower (whether sounding in tort,
contract or otherwise) for losses suffered by the Borrower in connection with,
arising out of, or in any way related to, the transactions contemplated and the
relationship established by the Loan Documents, or any act, omission or event
occurring in connection therewith, unless it is determined in a final
nonappealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Agent, the Collateral Agent, the Arranger, the
LC Issuer nor any Lender shall have any liability with respect to, and the
Borrower hereby waives, releases and agrees not to sue for, any special,
indirect, consequential or punitive damages suffered by the Borrower in
connection with, arising out of, or in any way related to the Loan Documents or
the transactions contemplated thereby.

9.11 Confidentiality. Each Lender agrees to, and to cause its Affiliates to,
hold any confidential information which it may receive from the Borrower
pursuant to this Agreement in confidence, except for disclosure (i) to its
Affiliates and to other Lenders and their respective Affiliates, (ii) to legal
counsel, accountants, and other professional advisors to such Lender or to a
Transferee, (iii) to regulatory officials, (iv) to any Person as requested
pursuant to or as required by law or regulation, (v) to any Person in connection
with any legal proceeding to which such Lender is a party, to the extent
required by law or legal process, provided that such Lender shall have used its
best reasonable efforts to provide notice to the Borrower of the legal process
requesting disclosure of such confidential information prior to disclosure, (vi)
to such Lender's direct or indirect contractual counterparties in swap
agreements or to legal counsel, accountants and other professional advisors to
such counterparties, provided that such Lender is a party to a Rate Management
Transaction with the Borrower, (vii) permitted by Section 12.4, and (viii) to
rating agencies if requested or required by such agencies in connection with a
rating relating to the Advances hereunder.

9.12 Nonreliance. Each Lender hereby represents that it is not relying on or
looking to any margin stock (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) for the repayment of the Credit
Extensions provided for herein.

9.13 Disclosure. The Borrower and each Lender hereby acknowledge and agree that
the Agent and/or its Affiliates from time to time may hold investments in, make
other loans to or have other relationships with the Borrower and its Affiliates.

9.14 Joinder of Guarantors. If a Subsidiary is required to join this Agreement
as a Guarantor pursuant to Section 6.14 (regarding Subsidiaries) and/or 6.13
(regarding Permitted Acquisitions) then (a) such Subsidiary shall execute and
deliver to the Agent (1) a Guarantor Joinder in substantially the form attached
hereto as Exhibit N (a "Guarantor Joinder") pursuant to which it shall join as a
Guarantor each of the documents to which the Guarantors are parties; (2)
documents in the forms described in Section 4.1 modified as appropriate to
relate to such Subsidiary, including opinions of counsel with respect to each
Subsidiary; (3) documents necessary to grant and perfect first and prior Liens
(other than Permitted Liens) in favor of the Collateral Agent in all property
and assets held by such Subsidiary and in the ownership interests in such
Subsidiary, and (b) to the extent required under this Agreement, the Loan Party
which holds the ownership interest in such Subsidiary shall take such steps as
are necessary to pledge such interests pursuant to the Pledge and Security
Agreement and grant to the Collateral Agent first and prior Liens (other than
Permitted Liens) therein, except to the extent such grant of security interests
is excused or delayed under Section 6.13(iii)(d)(3) of this Agreement. In the
case of any Subsidiary formed after the date of this Agreement, the Loan Parties
shall deliver such Guarantor Joinder and related documents to the Agent within
five (5) business days after the date of the filing of such Subsidiary's
Articles of Incorporation if the Subsidiary is a corporation, the date of the
filing of its certificate of limited partnership if it is a limited partnership,
or the date of its organization if it is an entity other than a limited
partnership or corporation, or the closing date of the acquisition agreement in
the case of a Permitted Acquisition.

9.15 Business Days. Except as provided in the definition of "Interest Period" in
Article I above, if any provision of this Agreement or any of the other Loan
Documents requires that the Borrower perform any act (other than to make a
payment) on a day that is not a Business Day, then the action shall be deemed to
be due on the first day thereafter that is a Business Day; and in the case of a
payment, shall be due on the last Business Day prior to the date that is not a
Business Day but upon which the payment is due.

9.16 No Course of Dealing. No course of dealing between the Borrower and the
Lenders, the Agent or the Collateral Agent shall operate as a waiver of any of
the rights of the Lenders, the Agent and the Collateral Agent under any of the
Loan Documents.

9.17 Waivers by the Borrower. The Borrower hereby waives, to the extent
permitted by applicable law, (a) all presentments, demands for performances,
notices of nonperformance (except to the extent specifically required by this
Agreement or any other of the Loan Documents), protests, notices of protest and
notices of dishonor in connec-tion with this Agreement or any Notes, (b) any
requirement of diligence or promptness on the part of any Lender in enforcement
of rights under the provisions of any of the Loan Documents, and (c) any
requirement of marshaling assets or proceed-ing against Persons or assets in any
particular order.

9.18 Incorporation by Reference. All schedules, annexes or other attachments to
this Agreement are incorporated into this Agreement as if set out in full at the
first place in this Agreement that reference is made thereto.

9.19 USA Patriot Act Notification. The following notification is provided to the
Borrower pursuant to Section 326 of the USA Patriot Act of 2001, 31 U.S.C.
Section 5318:

IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the
government of the United States of America fight the funding of terrorism and
money laundering activities, Federal law requires all financial institutions to
obtain, verify, and record information that identifies each Person that opens an
account, including any deposit account, treasury management account, loan, other
extension of credit, or other financial services product. Accordingly, when the
Borrower opens an account, the Agent and the Lenders will ask for the Borrower's
name, tax identification number, business address, and other information that
will allow the Agent and the Lenders to identify the Borrower. The Agent and the
Lenders may also ask to see the Borrower's legal organizational documents or
other identifying documents.

ARTICLE X
 
THE AGENT

10.1 Appointment; Nature of Relationship. JPMorgan is hereby re-appointed by
each of the Lenders as its contractual representative and as Collateral Agent
(herein referred to collectively in this Article X as the "Agent") hereunder and
under each other Loan Document, and each of the Lenders irrevocably authorizes
the Agent to act as the contractual representative of such Lender with the
rights and duties expressly set forth herein and in the other Loan Documents.
The Agent agrees to act as such contractual representative upon the express
conditions contained in this Article X. Notwithstanding the use of the defined
term "Agent," it is expressly understood and agreed that the Agent shall not
have any fiduciary responsibilities to any Lender by reason of this Agreement or
any other Loan Document and that the Agent is merely acting as the contractual
representative of the Lenders with only those duties as are expressly set forth
in this Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, and (ii) is acting as an independent contractor,
the rights and duties of which are limited to those expressly set forth in this
Agreement and the other Loan Documents. Each of the Lenders hereby agrees to
assert no claim against the Agent on any agency theory or any other theory of
liability for breach of fiduciary duty, all of which claims each Lender hereby
waives. Except as expressly set forth herein, the Agent shall not have any duty
to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrower or any other Loan Party that is
communicated to or obtained by the bank servicing as Agent or any of its
Affiliates in any capacity.

10.2 Powers. The Agent shall have and may exercise such powers under the Loan
Documents as are specifically delegated to the Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The
Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.

10.3 General Immunity. Neither the Agent nor any of its directors, officers,
agents or employees shall be liable to the Borrower, the Lenders or any Lender
for any action taken or omitted to be taken by it or them hereunder or under any
other Loan Document or in connection herewith or therewith except to the extent
such action or inaction is determined in a final non-appealable judgment by a
court of competent jurisdiction to have arisen from the gross negligence or
willful misconduct of such Person.

10.4 No Responsibility for Loans, Recitals, etc Neither the Agent nor any of its
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into, or verify (a) any statement, warranty or
representation made in connection with any Loan Document or any borrowing
hereunder; (b) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Agent; (d) the existence
or possible existence of any Default or Unmatured Default; (e) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith; (f) the
value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of the Borrower or any
Guarantor of any of the Obligations or of any of the Borrower's or any such
Guarantor's respective Subsidiaries. The Agent shall have no duty to disclose to
the Lenders information that is not required to be furnished by the Borrower to
the Agent at such time, but is voluntarily furnished by the Borrower to the
Agent (either in its capacity as Agent, or as Collateral Agent, or in its
individual capacity).

10.5 Action on Instructions of Lenders. The Agent shall in all cases be fully
protected in acting, or in refraining from acting, hereunder and under any other
Loan Document in accordance with written instructions signed by the Required
Lenders, and such instructions and any action taken or failure to act pursuant
thereto shall be binding on all of the Lenders. The Lenders hereby acknowledge
that the Agent shall be under no duty to take any discretionary action permitted
to be taken by it pursuant to the provisions of this Agreement or any other Loan
Document unless it shall be requested in writing to do so by the Required
Lenders. The Agent shall be fully justified in failing or refusing to take any
action hereunder and under any other Loan Document unless it shall first be
indemnified to its satisfaction by the Lenders pro rata against any and all
liability, cost and expense that it may incur by reason of taking or continuing
to take any such action.

10.6 Employment of Agents and Counsel. The Agent may execute any of its duties
as Agent hereunder and under any other Loan Document by or through employees,
agents, and attorneys-in-fact and shall not be answerable to the Lenders, except
as to money or securities received by it or its authorized agents, for the
default or misconduct of any such agents or attorneys-in-fact selected by it
with reasonable care. The Agent shall be entitled to advice of counsel
concerning the contractual arrangement between the Agent and the Lenders and all
matters pertaining to the Agent's duties hereunder and under any other Loan
Document.

10.7 Reliance on Documents; Counsel. The Agent shall be entitled to rely upon
any Note, notice, consent, certificate, affidavit, letter, telegram, statement,
paper or document believed by it to be genuine and correct and to have been
signed or sent by the proper person or persons, and, in respect to legal
matters, upon the opinion of counsel selected by the Agent, which counsel may be
employees of the Agent.

10.8 Agent's Reimbursement and Indemnification. The Lenders agree to reimburse
and indemnify the Agent ratably in proportion to their respective Commitments
(or, if the Commitments have been terminated, in proportion to their Commitments
immediately prior to such termination) (i) for any amounts not reimbursed by the
Borrower for which the Agent is entitled to reimbursement by the Borrower under
the Loan Documents, (ii) for any other expenses incurred by the Agent on behalf
of the Lenders, in connection with the preparation, execution, delivery,
administration and enforcement of the Loan Documents (including, without
limitation, for any expenses incurred by the Agent in connection with any
dispute between the Agent and any Lender or between two or more of the Lenders)
and (iii) for any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the Agent in
any way relating to or arising out of the Loan Documents or any other document
delivered in connection therewith or the transactions contemplated thereby
(including, without limitation, for any such amounts incurred by or asserted
against the Agent in connection with any dispute between the Agent and any
Lender or between two or more of the Lenders), or the enforcement of any of the
terms of the Loan Documents or of any such other documents, provided that (i) no
Lender shall be liable for any of the foregoing to the extent any of the
foregoing is found in a final non-appealable judgment by a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the Agent and (ii) any indemnification required pursuant to Section 3.5(vii)
shall, notwithstanding the provisions of this Section 10.8, be paid by the
relevant Lender in accordance with the provisions thereof. The obligations of
the Lenders under this Section 10.8 shall survive payment of the Obligations and
termination of this Agreement.

10.9 Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Unmatured Default hereunder unless
the Agent has received written notice from a Lender or the Borrower referring to
this Agreement describing such Default or Unmatured Default and stating that
such notice is a "notice of default". In the event that the Agent receives such
a notice, the Agent shall give prompt notice thereof to the Lenders.

10.10 Rights as a Lender. In the event the Agent is a Lender, the Agent shall
have the same rights and powers hereunder and under any other Loan Document with
respect to its Commitment and its Loans as any Lender and may exercise the same
as though it were not the Agent, and the term "Lender" or "Lenders" shall, at
any time when the Agent is a Lender, unless the context otherwise indicates,
include the Agent in its individual capacity. The Agent and its Affiliates may
accept deposits from, lend money to, and generally engage in any kind of trust,
debt, equity or other transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with the Borrower or any of its
Subsidiaries in which the Borrower or such Subsidiary is not restricted hereby
from engaging with any other Person. The Agent, in its individual capacity, is
not obligated to be remain a Lender.

10.11 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arranger or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.

10.12 Successor Agent. The Agent may resign at any time by giving written notice
thereof to the Lenders and the Borrower, such resignation to be effective upon
the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. Upon any such resignation, the Required Lenders shall have
the right to appoint, on behalf of the Borrower and the Lenders, a successor
Agent. If no successor Agent shall have been so appointed by the Required
Lenders within thirty days after the resigning Agent's giving notice of its
intention to resign, then the resigning Agent may appoint, on behalf of the
Borrower and the Lenders, a successor Agent. Notwithstanding the previous
sentence, the Agent may at any time without the consent of the Borrower or any
Lender, appoint any of its Affiliates which is a commercial bank as a successor
Agent hereunder. If the Agent has resigned and no successor Agent has been
appointed, the Lenders may perform all the duties of the Agent hereunder and the
Borrower shall make all payments in respect of the Obligations to the applicable
Lender and for all other purposes shall deal directly with the Lenders. No
successor Agent shall be deemed to be appointed hereunder until such successor
Agent has accepted the appointment. Any such successor Agent shall be a
commercial bank having capital and retained earnings of at least $100,000,000.
Upon the acceptance of any appointment as Agent hereunder by a successor Agent,
such successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning Agent. Upon the
effectiveness of the resignation of the Agent, the resigning Agent shall be
discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation of an Agent, the
provisions of this Article X shall continue in effect for the benefit of such
Agent in respect of any actions taken or omitted to be taken by it while it was
acting as the Agent hereunder and under the other Loan Documents. In the event
that there is a successor to the Agent by merger, or the Agent assigns its
duties and obligations to an Affiliate pursuant to this Section 10.12, then the
term "Prime Rate" as used in this Agreement shall mean the prime rate, base rate
or other analogous rate of the new Agent.

10.13 Agent and Arranger Fees. The Borrower agrees to pay to the Agent and the
Arranger, for their respective accounts, the fees agreed to by the Borrower, the
Agent and the Arranger pursuant to that certain letter agreement dated August
26, 2005, or as otherwise agreed from time to time.

10.14 Delegation to Affiliates. The Borrower and the Lenders agree that the
Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.

10.15 Execution of Collateral Documents. The Lenders hereby empower and
authorize the Agent to cause the Collateral Agent, to execute and deliver to the
Borrower on their behalf the Security Agreement(s) and all related financing
statements and any financing statements, agreements, documents or instruments as
shall be necessary or appropriate to effect the purposes of the Security
Agreement(s).

10.16 Collateral Releases. The Lenders acknowledge that the Collateral Agent is
authorized to execute and deliver to the Borrower on their behalf any
agreements, documents or instruments as shall be necessary or appropriate to
effect any releases of Collateral which shall be permitted by the terms of this
Agreement (including, for example, lease, sale or other disposition of Property
permitted in Section 6.12) or of any other Loan Document or which shall
otherwise have been approved by the Required Lenders (or, if required by the
terms of Section 8.2, all of the Lenders) in writing, without further
authorization or consent from the Lenders; and without limiting any other
consents or authorizations provided by the Lenders, the Lenders hereby consent
to the Collateral Agent having and exercising that authority.

10.17 Co-Agents, Documentation Agent, Syndication Agent, etc. Neither any of the
Lenders identified in this Agreement as a "co-agent" nor the Documentation Agent
or the Syndication Agent shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such. Without limiting the foregoing, none of such Lenders shall have
or be deemed to have a fiduciary relationship with any Lender. Each Lender
hereby makes the same acknowledgments with respect to such Lenders as it makes
with respect to the Agent in Section 10.11.

ARTICLE XI

SETOFF; RATABLE PAYMENTS

11.1 Setoff. In addition to, and without limitation of, any rights of the
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available, but not including funds held by a Loan Party which are held by that
Loan Party only as custodian or trustee (and in which that Loan Party does not
have a beneficial interest) such as, (by way of example and not limitation),
Horseman’s Accounts, and which are clearly labeled to indicate that such funds
are so held by the Loan Party) and any other Indebtedness at any time held or
owing by any Lender or any Affiliate of any Lender to or for the credit or
account of the Borrower may be offset and applied toward the payment of the
Obligations owing to such Lender, whether or not the Obligations, or any part
thereof, shall then be due.

11.2. Ratable Payments. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Outstanding Credit Exposure (other than payments
received pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than
that received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a portion of the Aggregate Outstanding Credit Exposure held by the
other Lenders so that after such purchase each Lender will hold its Pro Rata
Share of the Aggregate Outstanding Credit Exposure. If any Lender, whether in
connection with setoff or amounts which might be subject to setoff or otherwise,
receives collateral or other protection for its Obligations or such amounts
which may be subject to setoff, such Lender agrees, promptly upon demand, to
take such action necessary such that all Lenders share in the benefits of such
collateral ratably in proportion to their respective Pro Rata Shares of the
Aggregate Outstanding Credit Exposure. In case any such payment is disturbed by
legal process, or otherwise, appropriate further adjustments shall be made.

ARTICLE XII

BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

 
12.1 Successors and Assigns. The terms and provisions of the Loan Documents
shall be binding upon and inure to the benefit of the Borrower, each other Loan
Party and the Lenders and their respective successors and assigns permitted
hereby, except that (i) the Borrower shall not have the right to assign its
rights or obligations under the Loan Documents without the prior written consent
of each Lender, (ii) any assignment by any Lender must be made in compliance
with Section 12.3, and (iii) any transfer by Participation must be made in
compliance with Section 12.2. Any attempted assignment or transfer by any party
not made in compliance with this Section 12.1 shall be null and void, unless
such attempted assignment or transfer is treated as a participation in
accordance with Section 12.3.3. The parties to this Agreement acknowledge that
clause (ii) of this Section 12.1 relates only to absolute assignments and this
Section 12.1 does not prohibit assignments creating security interests,
including, without limitation, (x) any pledge or assignment by any Lender of all
or any portion of its rights under this Agreement and any Note to a Federal
Reserve Bank or (y) in the case of a Lender which is a Fund, any pledge or
assignment of all or any portion of its rights under this Agreement and any Note
to its trustee in support of its obligations to its trustee; provided, however,
that no such pledge or assignment creating a security interest shall release the
transferor Lender from its obligations hereunder unless and until the parties
thereto have complied with the provisions of Section 12.3. The Agent may treat
the Person which made any Loan or which holds any Note as the owner thereof for
all purposes hereof unless and until such Person complies with Section 12.3;
provided, however, that the Agent may in its discretion (but shall not be
required to) follow instructions from the Person which made any Loan or which
holds any Note to direct payments relating to such Loan or Note to another
Person. Any assignee of the rights to any Loan or any Note agrees by acceptance
of such assignment to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the owner of the
rights to any Loan (whether or not a Note has been issued in evidence thereof),
shall be conclusive and binding on any subsequent holder or assignee of the
rights to such Loan.

12.2 Participations.

12.2.1 Permitted Participants; Effect. Any Lender may at any time sell to one or
more banks or other entities ("Participants") participating interests in any
Outstanding Credit Exposure of such Lender, any Note held by such Lender, any
Commitment of such Lender or any other interest of such Lender under the Loan
Documents. In the event of any such sale by a Lender of participating interests
to a Participant, such Lender's obligations under the Loan Documents shall
remain unchanged, such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, such Lender shall remain
the owner of its Outstanding Credit Exposure and the holder of any Note issued
to it in evidence thereof for all purposes under the Loan Documents, all amounts
payable by the Borrower under this Agreement shall be determined as if such
Lender had not sold such participating interests, and the Borrower, the Agent
and the Collateral Agent shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under the Loan
Documents.

12.2.2 Voting Rights. Each Lender shall retain the sole right to approve,
without the consent of any Participant, any amendment, modification or waiver of
any provision of the Loan Documents other than any amendment, modification or
waiver with respect to any Credit Extension or Commitment in which such
Participant has an interest which would require consent of all of the Lenders
pursuant to the terms of Section 8.2 or of any other Loan Document.

12.2.3 Benefit of Certain Provisions. The Borrower agrees that each Participant
shall be deemed to have the right of setoff provided in Section 11.1 in respect
of its participating interest in amounts owing under the Loan Documents to the
same extent as if the amount of its participating interest were owing directly
to it as a Lender under the Loan Documents, provided that each Lender shall
retain the right of setoff provided in Section 11.1 with respect to the amount
of participating interests sold to each Participant. The Lenders agree to share
with each Participant, and each Participant, by exercising the right of setoff
provided in Section 11.1, agrees to share with each Lender, any amount received
pursuant to the exercise of its right of setoff, such amounts to be shared in
accordance with Section 11.2 as if each Participant were a Lender. The Borrower
further agrees that each Participant shall be entitled to the benefits of and
bound by the provisions of Section 2.21 and Sections 3.1, 3.2, 3.4 and 3.5 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to Section 12.3, provided that (i) a Participant shall not
be entitled to receive any greater payment under Section 3.1, 3.2 or 3.5 than
the Lender who sold the participating interest to such Participant would have
received had it retained such interest for its own account, unless the sale of
such interest to such Participant is made with the prior written consent of the
Borrower, and (ii) any Participant not incorporated under the laws of the United
States of America or any State thereof agrees to comply with the provisions of
Section 3.5 to the same extent as if it were a Lender.
 

12.3 Assignments.

12.3.1 Permitted Assignments. Any Lender may at any time assign to one or more
banks or other entities ("Purchasers") all or any part of its rights and
obligations under the Loan Documents. Such assignment shall be substantially in
the form of Exhibit C or in such other form as may be agreed to by the parties
thereto. Each such assignment with respect to a Purchaser which is not a Lender
or an Affiliate of a Lender or an Approved Fund shall either be in an amount
equal to the entire applicable Commitment and Loans of the assigning Lender or
(unless each of the Borrower and the Agent otherwise consents) be in an
aggregate amount not less than $5,000,000. The amount of the assignment shall be
based on the Commitment or outstanding Loans (if the Commitment has been
terminated) subject to the assignment, determined as of the date of such
assignment or as of the "Trade Date," if the "Trade Date" is specified in the
assignment.

      12.3.2 Consents. The consent of the Borrower shall be required prior to an
assignment becoming effective unless the Purchaser is a Lender, an Affiliate of
a Lender or an Approved Fund, provided that the consent of the Borrower shall
not be required if a Default has occurred and is continuing. The consent of the
Agent shall be required for each assignment. Any consent required under this
Section 12.3.2 shall not be unreasonably withheld or delayed.

12.3.3 Effect; Effective Date. Upon (i) delivery to the Agent of an assignment,
together with any consents required by Sections 12.3.1 and 12.3.2, and (ii)
payment of a $3,500 fee to the Agent (payable by a party other than a Loan
Party) for processing such assignment (unless such fee is waived by the Agent),
such assignment shall become effective on the effective date specified in such
assignment. The assignment shall contain a representation by the Purchaser to
the effect that none of the consideration used to make the purchase of the
Commitment and Outstanding Credit Exposure under the applicable assignment
agreement constitutes "plan assets" as defined under ERISA and that the rights
and interests of the Purchaser in and under the Loan Documents will not be "plan
assets" under ERISA. On and after the effective date of such assignment, such
Purchaser shall for all purposes be a Lender party to this Agreement and any
other Loan Document executed by or on behalf of the Lenders and shall have all
the rights and obligations of a Lender under the Loan Documents, to the same
extent as if it were an original party thereto, and the transferor Lender shall
be released with respect to the Commitment and Outstanding Credit Exposure
assigned to such Purchaser without any further consent or action by the
Borrower, the Lenders or the Agent. In the case of an assignment covering all of
the assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a Lender hereunder but shall continue to be entitled to the
benefits of, and subject to, those provisions of this Agreement and the other
Loan Documents which survive payment of the Obligations and termination of the
applicable agreement. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 12.3
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with Section 12.2.
Upon the consummation of any assignment to a Purchaser pursuant to this Section
12.3.3, the transferor Lender, the Agent and the Borrower shall, if the
transferor Lender or the Purchaser desires that its Loans be evidenced by Notes,
make appropriate arrangements so that new Notes or, as appropriate, replacement
Notes are issued to such transferor Lender and new Notes or, as appropriate,
replacement Notes, are issued to such Purchaser, in each case in principal
amounts reflecting their respective Commitments, as adjusted pursuant to such
assignment.

      12.3.4 Register. The Agent, acting solely for this purpose as an agent of
the Borrower, shall maintain at one of its offices in Louisville, Kentucky a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
conclusive, and the Borrower, the Agent and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.

12.4 Dissemination of Information. The Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, including
without limitation any information contained in any Reports; provided that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this
Agreement.

12.5 Tax Treatment. If any interest in any Loan Document is transferred to any
Transferee which is not incorporated under the laws of the United States or any
State thereof, the transferor Lender shall cause such Transferee, concurrently
with the effectiveness of such transfer, to comply with the provisions of
Section 3.5(iv).

ARTICLE XIII

NOTICES

13.1 Notices. Except as otherwise permitted by Section 2.10 with respect to
borrowing notices, all notices, requests and other communications to any party
hereunder shall be in writing (including electronic transmission, facsimile
transmission or similar writing) and shall be given to such party: (x) in the
case of the Borrower, any other Loan Party, or the Agent, at the address of
Borrower or facsimile number of Borrower set forth on the signature pages
hereof, (y) in the case of any Lender, at its address or facsimile number set
forth below its signature hereto, or (z) in the case of any party, at such other
address or facsimile number as such party may hereafter specify for the purpose
by notice to the Agent and the Borrower in accordance with the provisions of
this Section 13.1. Each such notice, request or other communication shall be
effective (i) if given by facsimile transmission, when transmitted to the
facsimile number specified in this Section and confirmation of receipt is
received, (ii) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid, or (iii)
if given by any other means, when delivered (or, in the case of electronic
transmission, received) at the address specified in this Section; provided that
notices to the Agent under Article II shall not be effective until received.

13.2 Change of Address. The Borrower, any other Loan Party, the Agent and any
Lender may each change the address for service of notice upon it by a notice in
writing to the other parties hereto.

ARTICLE XIV

COUNTERPARTS; INTEGRATION; EFFECTIVENESS

 
This Agreement may be executed in counterparts (and by different parties hereto
in different counterparts), each of which shall constitute an original, but all
of which when taken together shall constitute a single contract. Except as
provided in Article IV, this Agreement shall become effective when it shall have
been executed by the Borrower, the Agent, the Collateral Agent, the LC Issuer,
the Lenders and the Departing Lenders and when the Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
such parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
Delivery of an executed counterpart of a signature page of this Agreement by
telecopy shall be effective as delivery of a manually executed counterpart of
this Agreement.
 

ARTICLE XV

CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

15.1 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A CONTRARY
EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE
COMMONWEALTH OF KENTUCKY, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO
NATIONAL BANKS.

15.2 CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR COMMONWEALTH OF
KENTUCKY COURT SITTING IN LOUISVILLE, KENTUCKY IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT, THE COLLATERAL AGENT, THE LC
ISSUER OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF
ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE
AGENT, THE LC ISSUER OR ANY LENDER OR ANY AFFILIATE OF THE AGENT, THE LC ISSUER
OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING
OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN
A COURT IN LOUISVILLE, KENTUCKY.

15.3 WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, THE LC ISSUER AND EACH
LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY
OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.

[THE BALANCE OF THIS PAGE IS BLANK
AND SIGNATURES BEGIN ON THE FOLLOWING PAGE.]

 
 

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

 

IN WITNESS WHEREOF, the Borrower, the Guarantors, the Lenders, the Departing
Lenders, the LC Issuer, the Collateral Agent and the Agent have executed this
Agreement as of the date first above written.

 
CHURCHILL DOWNS INCORPORATED
         
By   /s/Michael E. Miller
           Michael E. Miller  
Title    Executive Vice President & CFO
 
            700 Central Avenue
    Louisville, Kentucky 40208
Attention: General Counsel
    Telephone: (502) 636-4501
    FAX: (502) 636-4439
   

 
GUARANTORS:

 
CHURCHILL DOWNS MANAGEMENT COMPANY 
     
By    /s/ Michael W. Anderson
       Michael W. Anderson  
Title:   Treasurer
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
CHURCHILL DOWNS INVESTMENT COMPANY 
     
By     /s/Michael W. Anderson
       Michael W. Anderson  
Title:      Treasurer
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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CHURCHILL DOWNS SIMULCAST PRODUCTIONS, LLC
     
By     /s/ Michael W. Anderson
       Michael W. Anderson  
Title:      Treasurer
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
CHARLSON INDUSTRIES, INC.
     
By    /s/ Michael W. Anderson
       Michael W. Anderson  
Title:  Treasurer
 
     700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
RACING CORPORATION OF AMERICA
     
By    /s/ Michael W. Anderson
        Michael W. Anderson  
Title:  Treasurer
 
   700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
CALDER RACE COURSE, INC.
     
By    /s/ Michael E. Miller
       Michael E. Miller  
Title:      Vice President
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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

 
TROPICAL PARK, INC.
     
By    /s/ Michael E. Miller
       Michael E. Miller  
Title:   Vice President
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
ARLINGTON PARK RACECOURSE, LLC
     
By    /s/ Michael E. Miller
       Michael E. Miller  
Title:  Vice President
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
ARLINGTON MANAGEMENT SERVICES, LLC
     
By    /s/ Michael E. Miller
       Michael E. Miller  
Title:   Vice President
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
ARLINGTON OTB CORP.
     
By    /s/ Debra A. Wood
       Debra A. Wood  
Title:   Secretary
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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

 
QUAD CITY DOWNS, INC.
     
By    /s/ Debra A. Wood
       Debra A. Wood  
Title:  Secretary
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
CDIP, LLC
     
By    /s/ Michael E. Miller
       Michael E. Miller  
Title:   Vice President
 
    700 Central Avenue
     
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
CDIP HOLDINGS, LLC
     
By   /s/ Michael E. Miller
        Michael E. Miller  
Title:   Vice President
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
ELLIS PARK RACE COURSE, INC.
     
By   /s/ Michael E. Miller
      Michael E. Miller  
Title:  Vice President
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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

 
CHURCHILL DOWNS LOUISIANA HORSERACING COMPANY, L.L.C.
     
By    /s/ Michael E. Miller
       Michael E. Miller  
Title:   Treasurer
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
CHURCHILL DOWNS LOUISIANA VIDEO POKER COMPANY, L.L.C.
     
By    /s/ Michael E. Miller
      Michael E. Miller  
Title:    Treasurer
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

 
VIDEO SERVICES, INC.
     
By    /s/ Michael E. Miller
      Michael E. Miller  
Title:    Treasurer
 
    700 Central Avenue
 
    Louisville, Kentucky 40208
 
Attention: General Counsel
 
    Telephone: (502) 636-4501
 
    FAX: (502) 636-4439

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$30,000,000
JPMORGAN CHASE BANK, N.A. (successor by merger to Bank One, NA),
 
Individually, as a Lender and as Agent
     
By    /s/ H. Joseph Brenner
 
    H. Joseph Brenner
 
    First Vice President
 
    416 W. Jefferson Street
 
    Louisville, Kentucky 40202
 
Attention: H. Joseph Brenner
 
    Telephone:     (502) 566-2789
 
    FAX:         (502) 566-8339

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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JPMORGAN CHASE BANK, N.A. (successor by merger to Bank One, NA),
 
as Collateral Agent
     
By   /s/ H. Joseph Brenner
 
    H. Joseph Brenner
 
    First Vice President
 
    416 W. Jefferson Street
 
    Louisville, Kentucky 40202
 
Attention: H. Joseph Brenner
 
    Telephone:     (502) 566-2789
 
    FAX:        (502) 566-8339

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$30,000,000
PNC BANK, NATIONAL ASSOCIATION
 
As a Lender, as LC Issuer and as Syndication Agent
     
By   /s/ Richard M. Ellis
 
    Richard M. Ellis
 
    Senior Vice President
 
    500 West Jefferson Street, 2nd Floor
 
    Louisville, Kentucky 40296
 
Attention: Shelly Stephenson, Vice President
 
    Telephone:    (502) 581-4522
 
    FAX:        (502) 581-3355

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$25,000,000
NATIONAL CITY BANK OF KENTUCKY
 
As a Lender and as Documentation Agent
     
By   /s/ Rob King
 
    Rob King
 
    Senior Vice President
 
    101 South Fifth Street, 37th Floor
 
    Louisville, Kentucky 40202
 
Attention: Rob King
 
    Telephone:     (502) 581-4024
 
    FAX:         (502) 581-6454

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$22,500,000
FIFTH THIRD BANK, KENTUCKY, INC.
     
By   /s/ Jeffery G. Goodwin
 
    Jeffery G. Goodwin
 
    Vice President
 
    401 South 4th Avenue
 
    Louisville, Kentucky 40202-3411
 
Attention: Jeffery G. Goodwin
 
    Telephone:     (502) 562-8228
 
    FAX:         (502) 562-5540

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$18,500,000
BRANCH BANKING & TRUST COMPANY
     
By   /s/ Johnny L. Perry
 
    Johnny L. Perry
 
    Senior Vice President
 
    P.O. Box 1101
 
    Louisville, Kentucky 40201
 
Attention: Johnny L. Perry
 
    Telephone:  (502) 562-5877
 
    FAX:  (502) 562-6990

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$18,500,000
COMERICA BANK
     
By   /s/ Heather A. Whiting
 
    Heather A. Whiting
 
    Account Officer
 
    500 Woodward Avenue
 
    MC 3269 - 9th Floor
 
    Detroit, Michigan 48214
 
Attention: Heather A. Whiting
 
    Telephone:    (313) 222-7046
 
    FAX:       (313) 222-9516

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$18,500,000
U.S. BANK NATIONAL ASSOCIATION
     
By   /s/ David Wombwell
 
    David Wombwell
 
    Senior Vice President
 
    One Financial Square
 
    Louisville, Kentucky 40202-3322
 
Attention: David Wombwell
 
    Telephone:    (502) 565-6685
 
    FAX:        (502) 565-6460

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$18,500,000
SUN TRUST BANK
     
By   /s/ Anson Lewis
 
    Anson Lewis
 
    Vice President
 
    201 4th Avenue N., 3rd Floor
 
    Nashville, Tennessee 37219
 
Attention: Anson Lewis
 
    Telephone:    (615) 748-4108
 
    FAX:        (615) 748-5269

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Commitment

$18,500,000
BANK OF AMERICA
     
By   /s/ Brian Sallee
 
    Brian Sallee
 
    Vice President
 
    414 Union Street
 
    TN1-100-04-04
 
    Nashville, Tennessee 37239
 
Attention: Brian Sallee
 
    Telephone:    (615) 749-3769
 
    FAX:        (615) 749-4762

Signature Page to
Amended and Restated Credit Agreement
Churchill Downs Incorporated et al

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Exhibits and schedules to Exhibit 10.1, other than the Pricing Schedule, have
been intentionally omitted because they are not material. The registrant agrees
to furnish such omitted exhibits and schedules supplementally to the Commission
upon request.
 
 
 
 
 

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PRICING SCHEDULE

 
Applicable Margin
 
 
Level I Status
 
 
Level II Status
 
 
Level III Status
 
 
Level IV Status
 
 
Eurodollar Rate
 
 
.75%
 
 
1.00%
 
 
1.25%
 
 
1.50%
 
 
Floating Rate
 
 
0%
 
 
0%
 
 
0%
 
 
0%
 

 
Applicable Fee Rate
 
 
Level I Status
 
 
Level II Status
 
 
Level III Status
 
 
Level IV Status
 
 
Commitment Fee
 
 
.15%
 
 
.20%
 
 
.25%
 
 
.375%
 

For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:

“Financials” means the annual or quarterly financial statements of the Borrower
delivered pursuant to Section 6.1(i) or (ii).

“Level I Status” exists at any date if, as of the last day of the fiscal quarter
of the Borrower referred to in the most recent Financials, the Leverage Ratio is
less than 1.00 to 1.00.

“Level II Status” exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (i) the
Borrower has not qualified for Level I Status and (ii) the Leverage Ratio is
less than 2.00 to 1.00.

“Level III Status” exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (i) the
Borrower has not qualified for Level I Status or Level II Status and (ii) the
Leverage Ratio is less than 3.00 to 1.00.

“Level IV Status” exists at any date if the Borrower has not qualified for Level
I Status, Level II Status or Level III Status.

“Status” means either Level I Status, Level II Status, Level III Status and
Level IV Status.

The Applicable Margin and Applicable Fee Rate shall be determined in accordance
with the foregoing table based on the Borrower's Status, adjusted quarterly and
measured on the most recent four fiscal quarters ending on the determination
date as reflected in the then most recent Financials. Adjustments, if any, to
the Applicable Margin or Applicable Fee Rate shall be effective five Business
Days after the Agent has received the applicable Financials. If the Borrower
fails to deliver the Financials to the Agent at the time required pursuant to
Section 6.1, then the Applicable Margin and Applicable Fee Rate shall be the
highest Applicable Margin and Applicable Fee Rate set forth in the foregoing
table until five days after such Financials are so delivered.
 
 

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