Exhibit 10.3

 

$105,000,000.00

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

by and among

 

CV PROPCO, LLC,

as the Borrower

 

NP TROPICANA LLC,
as the Leasehold Holder,

 

NP LANDCO HOLDCO LLC,

as Holdco,

 

 

DEUTSCHE BANK AG CAYMAN ISLANDS BRANCH

JPMORGAN CHASE BANK, N.A.,

 

and

THE INSTITUTIONS FROM TIME TO TIME PARTY HERETO,
as Lenders

 

DEUTSCHE BANK AG CAYMAN ISLANDS BRANCH,
as the Administrative Agent for the Secured Parties

 

JPMORGAN CHASE BANK, N.A.,

as Syndication Agent

 

DEUTSCHE BANK SECURITIES INC.

and

J.P. MORGAN SECURITIES INC.,

 

as Joint Lead Arrangers and Joint Book Running Manager

 

 

Dated as of June 16, 2011

 

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TABLE OF CONTENTS

 

 

 

 

 

 

Page

ARTICLE I DEFINED TERMS

 

3

 

 

 

 

 

 

 

 

 

Defined terms

 

3

 

1.2

 

Other Interpretive Provisions

 

40

 

 

 

Accounting Terms; Calculations

 

43

 

 

 

 

 

 

ARTICLE II Credit Facility

 

43

 

 

 

 

 

 

Loans; Advances to Borrower; Amendment and Restatement

 

43

 

 

 

Amendment and Restatement

 

44

 

2.3

 

Maturity

 

44

 

2.4

 

Manner of Payment of Loans; Evidence of Debt

 

46

 

 

 

Repayment and Prepayment of Loans; Mandatory Prepayments

 

48

 

2.6

 

Interest

 

50

 

2.7

 

Presumptions of Payment

 

50

 

2.8

 

Pro Rata Treatment

 

51

 

2.9

 

Inability to Determine Rates

 

51

 

2.10

 

Illegality

 

51

 

2.11

 

Increased Costs

 

51

 

2.12

 

Obligation of Lenders to Mitigate

 

52

 

2.13

 

Funding Indemnification

 

53

 

2.14

 

Taxes

 

53

 

 

 

Payment of Fees

 

55

 

2.16

 

Credit Support

 

55

 

 

 

 

 

 

ARTICLE III CONDITIONS

 

55

 

 

 

 

 

 

Effectiveness of Agreement

 

55

 

 

 

 

 

 

ARTICLE IV Representations and Warranties

 

58

 

 

 

 

 

 

Financial Condition

 

58

 

 

 

No Material Adverse Effect

 

59

 

 

 

Compliance with Laws

 

59

 

4.4

 

Organization, Powers; Authorization; Enforceability

 

59

 

 

 

No Conflict

 

60

 

 

 

No Material Litigation

 

60

 

 

 

Taxes

 

60

 

 

 

Regulated Entities

 

61

 

 

 

Borrower Parties

 

61

 

 

 

Federal Reserve Board Regulations

 

61

 

 

 

ERISA Compliance

 

62

 

4.12

 

Assets and Liens

 

62

 

 

 

Securities Acts

 

63

 

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Consents, Etc

 

63

 

 

 

Hazardous Materials

 

64

 

 

 

Intellectual Property

 

65

 

 

 

Insurance

 

65

 

 

 

Full Disclosure

 

65

 

 

 

Brokers

 

65

 

 

 

No Default

 

65

 

 

 

Contractual Obligations

 

65

 

4.22

 

Representations Regarding the Mortgaged Property

 

65

 

 

 

Single Purpose Entity

 

67

 

 

 

Labor

 

67

 

 

 

Taxpayer Identification Number

 

68

 

4.26

 

Anti-Terrorism Laws

 

68

 

 

 

Accounts

 

68

 

 

 

Intentionally Omitted

 

69

 

 

 

Ground Leases

 

69

 

4.30

 

Management Agreements

 

70

 

 

 

Option Parcels

 

70

 

 

 

Restructuring

 

71

 

 

 

 

 

 

ARTICLE V Affirmative Covenants

 

71

 

 

 

 

5.1

 

Reporting Requirements

 

71

 

 

 

Maintenance of Existence and Rights

 

75

 

 

 

Compliance with Laws; Forfeiture

 

76

 

 

 

Access

 

76

 

5.5

 

Insurance; Casualty; Condemnation; Restoration

 

76

 

5.6

 

Books and Records

 

79

 

 

 

Maintenance of Mortgaged Property/Business Operations

 

79

 

 

 

Approved Leases

 

81

 

 

 

Taxes

 

81

 

5.10

 

Environmental

 

81

 

 

 

Title to the Mortgaged Property

 

83

 

 

 

Interest Rate Contracts

 

83

 

 

 

Single Purpose Entities

 

84

 

5.14

 

Franchise Agreement

 

84

 

 

 

Entitlements

 

85

 

5.16

 

Further Assurances

 

85

 

 

 

Intentionally Omitted

 

86

 

 

 

Ground Lease Covenants

 

86

 

 

 

Management Agreement

 

94

 

5.20

 

Option Parcel Covenants

 

98

 

 

 

Accounts

 

103

 

 

 

Gaming Matters/Licenses/Approvals/Permits

 

103

 

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Liens

 

103

 

 

 

Indebtedness

 

103

 

 

 

Fundamental Change

 

103

 

 

 

Disposition

 

103

 

 

 

Investments

 

106

 

 

 

Transactions with Affiliates

 

106

 

 

 

Modifications to Organizational Documents and Other Material Agreements

 

107

 

 

 

Restricted Payments

 

107

 

 

 

Zoning Changes

 

107

 

 

 

Sale Leaseback

 

107

 

 

 

Negative Pledges

 

107

 

 

 

Modifications

 

107

 

 

 

Interest Rate Contracts

 

108

 

 

 

Limitation on Cage Cash

 

108

 

 

 

Subdivision

 

108

 

 

 

Prohibition on Borrower Gaming Activity

 

108

 

 

 

 

 

 

 

 

 

Event of Default

 

108

 

7.2

 

Remedies

 

112

 

 

 

Ground Lease Parcel Purchase Option and Option Agreement

 

113

 

 

 

 

 

 

ARTICLE VIII The Administrative Agent

 

114

 

 

 

 

 

 

Appointment

 

114

 

 

 

Delegation of Duties

 

114

 

 

 

Exculpatory Provisions

 

115

 

 

 

Reliance by the Agents

 

115

 

 

 

Notice of Default

 

115

 

 

 

Non-Reliance on Agents and Other Lenders

 

116

 

 

 

Indemnification

 

116

 

 

 

Agents in Their Individual Capacity

 

117

 

 

 

Successor Administrative Agent

 

117

 

 

 

Limitations on Agents Liability

 

117

 

 

 

Collateral

 

117

 

 

 

 

 

 

ARTICLE IX Exculpation

 

118

 

 

 

 

 

 

Exculpated Parties

 

118

 

 

 

Carveouts From Non-Recourse Limitations

 

118

 

 

 

 

 

 

ARTICLE X Miscellaneous Provisions

 

120

 

 

 

 

 

 

No Assignment by Borrower

 

120

 

10.2

 

Modification

 

120

 

 

 

Cumulative Rights; No Waiver

 

121

 

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Entire Agreement

 

121

 

 

 

Survival

 

121

 

 

 

Notices

 

121

 

 

 

Governing Law

 

122

 

10.8

 

Assignments, Participations, Syndication, Etc.

 

122

 

 

 

Counterparts

 

124

 

 

 

Sharing of Payments

 

124

 

 

 

Confidentiality

 

124

 

 

 

Consent to Jurisdiction

 

125

 

 

 

Waiver of Jury Trial

 

125

 

 

 

Indemnity

 

126

 

 

 

Telephonic Instruction

 

126

 

 

 

Marshalling; Payments Set Aside

 

127

 

 

 

Set-off

 

127

 

 

 

Severability

 

127

 

 

 

No Third Parties Benefited

 

127

 

 

 

Time

 

127

 

 

 

Reinstatement

 

128

 

 

 

Rights Under Specified Interest Rate Contracts

 

128

 

 

 

Reaffirmation, Waiver of Offsets, Counterclaims and Defenses

 

128

 

 

 

 

 

 

ARTICLE XI PAYMENT GUARANTY

 

129

 

 

 

 

 

 

Payment Guaranty

 

129

 

 

 

Bankruptcy

 

129

 

 

 

Nature of Liability

 

129

 

 

 

Independent Obligation

 

130

 

 

 

Authorization

 

130

 

 

 

Reliance

 

131

 

 

 

Subordination

 

131

 

 

 

Waiver

 

131

 

 

 

Payments

 

133

 

 

 

Joint and Several Obligations

 

133

 

 

 

Maximum Liability

 

133

 

iv

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SCHEDULES AND EXHIBITS

 

SCHEDULES:

 

Schedule 1.1A

 

Legal Description of Cactus Assemblage

Schedule 1.1B

 

Legal Description of Option Parcels

Schedule 1.1C

 

Material Agreements

Schedule 1.1D

 

Legal Description of Wild Wild West Fee Assemblage

Schedule 1.1E

 

Legal Description of Wild Wild West Leasehold Assemblage

Schedule 1.1F

 

Existing Leases

Schedule 1.1G

 

Tenant Improvement, Leasing Commission and Rent Concession Budget

Schedule 2.1

 

Loan Amounts

Schedule 4

 

Exceptions to Representations and Warranties

Schedule 4.1

 

Material Obligations and Liabilities

Schedule 4.6

 

Material Litigation

Schedule 4.7

 

Taxes

Schedule 4.9

 

Capital Stock of Borrower

Schedule 4.11

 

ERISA Compliance

Schedule 4.14

 

Required Consents

Schedule 4.15

 

Hazardous Materials

Schedule 4.17

 

Existing Insurance

Schedule 4.24A

 

Strikes, Work Stoppages, Slowdowns or Lockouts Pending or Threatened

Schedule 4.24B

 

Unfair Labor Practices, Grievances or Complaints Pending or Threatened

Schedule 4.25

 

Taxpayer ID Numbers

Schedule 4.27

 

Accounts

Schedule 4.31

 

Option Defaults

Schedule 5.5

 

Insurance Requirements

Schedule 6.6

 

Affiliate Transactions

Schedule 10.6

 

Notices

 

v

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EXHIBITS

 

Exhibit A

 

Form of Assignment and Acceptance Agreement

Exhibit B

 

Form of Surveyor Certification

Exhibit C

 

Organizational Chart

 

vi

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AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) is made and dated
as of the 16th day of June, 2011 (“Effective Date”), by and between CV PROPCO,
LLC, a limited liability company organized under the laws of the state of Nevada
(“Borrower”); NP TROPICANA LLC, a limited liability company organized under the
laws of the state of Nevada (“Leasehold Holder”);  NP LANDCO HOLDCO LLC, a
Nevada limited liability company (“Holdco”), THE LENDERS FROM TIME TO TIME PARTY
HERETO (collectively and severally, the “Lenders”); DEUTSCHE BANK AG CAYMAN
ISLANDS BRANCH (“Deutsche Bank”), as administrative agent for the Secured
Parties (in such capacity, the “Administrative Agent”); and JPMORGAN CHASE BANK,
N.A. (“JPMorgan”) as syndication agent (in such capacity, the “Syndication
Agent”).

 

RECITALS

 

A.            Deutsche Bank Trust Company Americas (“DBTCA”) and JPMorgan (the
“Original Lenders”) extended the Existing Loans to Borrower in the aggregate
principal amount of $250,000,000 (as amended, restated and modified prior to the
Effective Date, the “Original Facility”) pursuant to the terms of that certain
Credit Agreement, dated as of the Closing Date, as amended by that certain First
Amendment to Credit Agreement dated as of June 30, 2008 (collectively, the
“Original Credit Agreement”).

 

B.            On July 28, 2009, (i) Station Casinos, Inc. (“SCINC”), the
previous indirect beneficial owner of Borrower, (ii) FCP Holding, Inc., FCP
VoteCo, LLC and Fertitta Partners LLC (collectively, the “Original Guarantor”),
and (iii) certain other Affiliates of SCINC (collectively, the “Debtor
Affiliates”) filed a voluntary bankruptcy petition under the Bankruptcy Code
with the United States Bankruptcy Court for the District of Nevada (the
“Bankruptcy Court”) and in connection therewith, filed a Plan of Reorganization
(as amended, supplemented or otherwise modified, the “Restructuring Plan”).

 

C.            On August 27, 2010, the Bankruptcy Court confirmed the
Restructuring Plan pursuant to an order (the “Confirmation Order”) which, among
other things, approved the restructuring of certain indebtedness of SCINC and
certain of its subsidiaries, and certain transactions affecting SCINC, Borrower,
PropCo and Lenders (together with various other agreements which are
prerequisites to obtaining agreement or otherwise implementing the transactions
approved in the Confirmation Order, the “Restructuring”).

 

D.            In connection with the Restructuring, in exchange for the Warrants
and pursuant to the terms of that certain Loan Modification Agreement (the
“Modification Agreement”) dated the date hereof  by and among Borrower, the
Original Lenders and Deutsche Bank AG, London Branch (“Original Swap
Counterparty), among other things, (i) the outstanding principal balance of the
Loan (as defined in the Original Credit Agreement) made by DBTCA to Borrower was
reduced to $62,047,650.00 (the “Reduced DBTCA Loan”), (ii) the outstanding
principal balance of the Loan (as defined in the Original Credit Agreement) made
by JP Morgan to Borrower was reduced to $39,213,300.00 (the “Reduced JP Morgan
Loan”), and (iii) the net termination payments payable to Original Swap
Counterparty under the Terminated

 

2

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Swap Agreements were reduced to $3,739,050.00 (collectively, the “Reduced Hedge
Termination Payment”) ((i), (ii) and (iii) are collectively, the “Reduction
Transactions”).

 

E.             Immediately following the Reduction Transactions (i) DBTCA
assigned, and Deutsche Bank assumed, all of DBTCA’s rights and obligations under
the Note (as defined in the Original Credit Agreement) issued by Borrower in
favor of DBTCA (the “Original DBTCA Note”) and the Original Credit Agreement and
(ii) Swap Counterparty assigned, and Deutsche Bank assumed, all of DBTCA’s
right, title and interest in the Reduced Hedge Termination Payment.

 

F.             Contemporaneously with the assignment of DBTCA’s rights and
obligations under the Original DBTCA Note and the Original Credit Agreement to
Deutsche Bank, DBTCA resigned as administrative agent under the Original Credit
Agreement, and the Lenders have appointed Deutsche Bank, and Deutsche Bank has
agreed, to act as administrative agent on behalf of the Lenders on the terms and
subject to the conditions set forth herein and in the other Loan Documents (as
that term and other capitalized terms used herein are defined in, or the
location of the definitions thereof referenced in, Article I).

 

G.            The Loan Parties and Lenders party hereto are, among other things,
amending and restating the Original Credit Agreement in order to memorialize the
Restructuring and otherwise reflect the addition of certain additional Mortgaged
Property as security for the Loans.

 

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

 

AGREEMENT

 

ARTICLE I
DEFINED TERMS

 

1.1           Defined terms.  As used in this Agreement, the following terms
have the following meanings:

 

“Acceptable Counterparty” shall mean a bank or other financial institution which
has (a) either (i) a long-term unsecured debt rating of “A+” or higher by S&P or
(ii) if the long-term unsecured debt rating is “A” or lower by S&P, a short-term
rating of not less than “A-1” from S&P; (b) a long-term unsecured debt rating of
not less than “Aa3” by Moody’s; and (c) if the counterparty is rated by Fitch,
either a long-term unsecured debt rating of not less than “A” from Fitch or a
short-term unsecured debt rating of not less than “F-1” from Fitch.

 

“Account Bank” shall mean any bank or financial institution with which has been
established any Accounts, provided that at all times each Account Bank shall be
an Approved Bank that is acceptable to Administrative Agent in its reasonable
discretion.

 

“Account” shall mean each deposit account or securities account of Borrower

 

3

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and/or Leasehold Holder and/or Holdco, which shall be an Eligible Account.

 

“Acknowledgment” shall mean the Acknowledgment made by the Acceptable
Counterparty to the Required Interest Rate Contracts in form and substance as is
acceptable to Administrative Agent.

 

“Act” shall have the meaning given such term in Section 4.13 of this Agreement.

 

“Administrative Agent” shall have the meaning given such term in the preamble to
this Agreement and shall include any successor to Deutsche Bank as the initial
“Administrative Agent” hereunder.

 

“Advance” shall mean each disbursement of any portion of a Loan by Lenders to
Borrower pursuant to the terms of this Agreement and the other Loan Documents.

 

“Affiliate” shall mean (a) with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified; provided,
that as to any Borrower Party or any Subsidiary thereof, the term “Affiliate”
shall expressly exclude the Persons constituting Lenders as of the Effective
Date and their respective Affiliates and (b) with respect to any Borrower Party
or any Subsidiary thereof, (i) Frank J. Fertitta III and his spouse, their
respective parents and grandparents and any lineal descendants (including
adopted children and their lineal descendants) of any of the foregoing,
(ii) Lorenzo J. Fertitta and his spouse, their respective parents and
grandparents and any lineal descendants (including adopted children and their
lineal descendants) of any of the foregoing, (iii) any Affiliate of any Person
described in the foregoing clauses (i) and (ii), or (iv) any personal investment
vehicle, trust or entity owned by, or established for the benefit of, or the
estate of, any Person described in the foregoing clauses (i) and (ii). 
“Control” means the possession, directly or indirectly, of the power to (x) vote
more than fifty percent (50%) of the outstanding voting interests of a Person or
(y) direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise. 
“Controlling” and “Controlled” have meanings correlative thereto.

 

“Agents” shall mean the Administrative Agent and the Syndication Agent, together
with their permitted successors and assigns.

 

“Agreement” shall mean this Amended and Restated Credit Agreement, as the same
may be Modified.

 

“ALTA” shall mean American Land Title Association, or any successor thereto.

 

“Anti-Terrorism Laws” shall have the meaning given such term in
Section 4.26(1) of this Agreement.

 

“Applicable Base Rate” shall mean the floating rate per annum equal to the daily
average Base Rate in effect during the applicable calculation period plus the
Base Rate Spread.

 

“Applicable LIBO Rate” shall mean, with respect to the applicable Interest

 

4

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Period, the floating rate per annum equal to the Reserve Adjusted LIBO Rate plus
the LIBO Rate Spread.

 

“Appraisal” shall mean a real estate appraisal conducted in accordance with the
Uniform Standards of Professional Appraisal Practice (as promulgated by the
Appraisal Standards Board of the Appraisal Foundation) and all Requirements of
Law applicable to Lenders, including in conformity with the Financial
Institutions Reform Recovery and Enforcement Act (FIRREA), undertaken by an
independent appraisal firm satisfactory to Agents in their sole discretion, and
providing an assessment of fair market value of the subject Real Property.

 

“Approved Bank” shall mean a bank or other financial institution which has a
minimum long-term unsecured debt rating of at least “A” and a minimum short-term
unsecured debt rating of at least “A-1” by each of the Rating Agencies, it being
understood that the A and A-1 benchmark ratings and other benchmark ratings in
this Agreement are intended to be the ratings, or the equivalent of ratings,
issued by S&P; provided that, notwithstanding the foregoing, the parties agree
that each of Bank of America, National Association and Wells Fargo Bank,
National Association shall be an Approved Bank.

 

“Approved Budget” shall have the meaning given such term in Section 5.1 of this
Agreement.

 

“Approved Leases” shall mean (a) all existing Leases, including, without
limitation, the leases set forth on Schedule 1.1F attached hereto (collectively,
the “Existing Leases”), (b) with respect to the Wild Wild West Fee Assemblage,
any Leases entered into by Borrower as landlord after the Effective Date which:
(i) will expire on or prior to the date that is five (5) years from the
Effective Date or which are terminable without cost to Borrower or Leasehold
Holder, as landlord, upon not more than sixty (60) days notice to the tenant
thereunder, and (ii) are otherwise for market Rents and are otherwise on market
terms and conditions; provided that any Lease of any portion of the Wild Wild
West Fee Assemblage shall not, notwithstanding compliance with clauses (i) and
(ii) above, constitute  an Approved Lease under this clause (b) (and thus shall
require the Administrative Agent’s approval under clause (c) below in order to
constitute an Approved Lease) if the total costs required to be incurred by the
landlord in connection with such Lease, including, without limitation, tenant
improvement allowances and/or cost of performing tenant improvements, leasing
commissions and financial concessions, exceeds 110% of the budgeted amount of
such costs for such portion of the Wild Wild West Fee Assemblage leased under
such Lease set forth on Schedule 1.1G (or if less than the entire premises
indentified on Schedule 1.1G is leased pursuant to such Lease, 110% of the pro
rata portion budgeted for such costs in relation to the portion of the premises
leased under such Lease), or (c) any other Leases entered into by Borrower or
Leasehold Holder, as landlord, after the Effective Date that are on terms, and
in form and substance, acceptable to the Administrative Agent, in its reasonable
discretion (provided that any Lease of all or any material portion of the
Hotel/Casino Facility shall require the Administrative Agent’s consent in its
sole and absolute discretion).

 

“Assignee” shall have the meaning given such term in Section 10.8(1) of this
Agreement.

 

5

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“Assignment and Acceptance Agreement” shall mean an agreement substantially in
the form of Exhibit A.

 

“Assignment of Contracts” shall collectively mean the (i) Amended and Restated
Assignment of Contracts, Licenses, Permits, Agreements, Warranties and Approvals
dated as of the Effective Date, between Borrower and Administrative Agent, as
the same may be Modified, and (ii) Assignment of Contracts, Licenses, Permits,
Agreements, Warranties and Approvals dated as of the Effective Date, between
Leasehold Holder and Administrative Agent, as the same may be Modified.

 

“Assignment of Interest Rate Contract” shall mean each Assignment of Interest
Rate Contract and Security Agreement in substantially the form delivered to
Administrative Agent as a condition to the Original Credit Agreement (or in such
other form as is approved by Administrative Agent) to be delivered by the
Borrower, as assignor, to the Administrative Agent, as assignee, assigning to
the Administrative Agent all of the Borrower’s interest in the applicable
Required Interest Rate Contract, as the same may be Modified.

 

“Assignment of Leases and Rents” shall collectively mean (i) the Assignments of
Leases and Rents entered into by Borrower in favor of Administrative Agent with
respect to the Mortgaged Property (excluding the Ground Lease Parcel), as the
same may be hereafter Modified from time to time and (ii) the Leasehold
Assignment of Leases and Rents entered into by the Leasehold Holder in favor of
Administrative Agent with respect to the Ground Lease Parcel, as the same may be
hereafter Modified from time to time.

 

“Bankruptcy Code” shall mean Title 11, U.S.C.A., as amended from time to time
and any successor thereto.

 

“Base Rate” shall mean on any day the higher of:  (a) the Prime Rate in effect
on such day, and (b) the sum of the Federal Funds Rate in effect on such day
plus one half of one percent (0.50%).

 

“Base Rate Loans” shall mean any Loans bearing interest at a rate determined by
reference to the Base Rate.

 

“Base Rate Spread” shall mean: (a) during the Original Term, two and one half
percent (2.5%); (b) during the First Extension Term (provided Borrower exercises
its first Option to Extend in accordance with the terms of Section 2.3 hereof),
three and one half percent (3.5%); and (c) during the Second Extension Term
(provided Borrower exercises its second Option to Extend in accordance with the
terms of Section 2.3 hereof), four and one half percent (4.5%). In the event the
Obligations are not repaid in full on the Maturity Date, the Base Rate Spread
for all periods after the Maturity Date until all Obligations are repaid and
performed in full shall be the Base Rate Spread in effect on the day prior to
the Maturity Date.

 

“Beneficial” shall mean, when used in the context of beneficial ownership, the
analogous meaning to that specified in Rule 13d-3 under the Securities Exchange
Act of 1934, as amended.

 

“Borrower” shall have the meaning given to such term in the preamble to this

 

6

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Agreement.

 

“Borrower Mortgaged Property” shall mean, collectively, all the “Mortgaged
Property” as such term is defined and set forth in each of the Security
Instruments executed by Borrower on or about the date hereof, and shall include
all the “Mortgaged Property” as defined in any of such Security Instruments.

 

“Borrower Parties” shall mean, jointly and severally, each of the Borrower, the
Leasehold Holder, Recourse Guarantor, Pledgor and any Affiliate of the foregoing
executing any Loan Document.

 

“Borrower Warrant Agreement” means that certain Warrant Purchase and
Securityholder Agreement, dated as of June 17, 2011, between Borrower, Holdco,
German American Capital Corporation, a Maryland corporation and JPMorgan.

 

“Borrower Warrants” means the “Warrants” as defined in the Borrower Warrant
Agreement.

 

“Budget” shall have the meaning given such term in Section 5.1(4) of this
Agreement.

 

“Business Day” shall mean any day other than a Saturday, a Sunday or a day on
which banks in New York are authorized or obligated to close their regular
banking business.

 

“Cactus Assemblage” shall mean that certain land assemblage located in the Las
Vegas, Nevada metropolitan area consisting of approximately 60.72 acres of land
located on the northeast corner of Interstate 15 and Cactus Avenue, as more
particularly described on Schedule 1.1A.

 

“Cage Cash” shall mean all so-called “cage cash” maintained within the
Hotel/Casino Facility.

 

“Capital Expenditures” shall mean, for any period, the aggregate of all
expenditures (whether paid in cash or accrued as liabilities) by Borrower and
the Leasehold Holder during such period that, in conformity with GAAP, are or
are required to be included as additions during such period to property, plant
or equipment reflected in the consolidated balance sheet of Borrower and the
Leasehold Holder, including, without limitation, expenditures for software and
other intangible personal property that are accounted for as capital
expenditures by Borrower or Leasehold Holder, provided that the term “Capital
Expenditures” shall not include (i) expenditures made in connection with the
replacement, substitution, restoration or repair of assets to the extent
financed with (x) insurance proceeds paid on account of the loss of or damage to
the assets being replaced, restored or repaired or (y) awards of compensation
arising from the taking by eminent domain or condemnation of the assets being
replaced, (ii) the purchase price of equipment that is purchased simultaneously
with the trade-in of existing equipment to the extent that the gross amount of
such purchase price is reduced by the credit granted by the seller of such
equipment for the equipment being traded in at such time, (iii) expenditures
that are accounted for as capital expenditures by the Borrower or Leasehold
Holder and that actually are paid for by a Person other than the Borrower or
Leasehold Holder and for

 

7

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which neither the Borrower nor Leasehold Holder has provided or is required to
provide or incur, directly or indirectly, any consideration or obligation to
such Person or any other Person (whether before, during or after such period),
or (iv) the book value of any asset owned by the Borrower or Leasehold Holder
prior to or during such period to the extent that such book value is included as
a capital expenditure during such period as a result of such Person reusing or
beginning to reuse such asset during such period without a corresponding
expenditure actually having been made in such period; provided that (x) any
expenditure necessary in order to permit such asset to be reused shall be
included as a Capital Expenditure during the period in which such expenditure
actually is made and (y) such book value shall have been included in Capital
Expenditures when such asset was originally acquired.

 

“Capital Stock” shall mean (a) with respect to any Person that is a corporation,
any and all shares, interests, participations or other equivalents (however
designated and whether or not voting) of corporate stock, including, without
limitation, each class or series of common stock and preferred stock of such
Person and (b) with respect to any Person that is not a corporation, any and all
investment units, partnership, membership or other equity interests of such
Person.

 

“Capitalized Lease Indebtedness” shall mean, on any date, in respect of any
Capitalized Lease of any Person, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP.

 

“Capitalized Leases” shall mean all leases that have been or should be, in
accordance with GAAP, recorded as capitalized leases; provided that for all
purposes hereunder the amount of obligations under any Capitalized Lease shall
be the amount thereof accounted for as a liability in accordance with GAAP.

 

“Cash Equivalents” shall mean, with respect to any Person, any direct
obligations of, or obligations guaranteed as to principal and interest by, the
United States of America or any agency or instrumentality thereof, provided that
such obligations are backed by the full faith and credit of the United States. 
Any such obligation must be limited to instruments that have a predetermined
fixed dollar amount of principal due at maturity that cannot vary or change.  If
any such obligation is rated by S&P, it shall not have an “r” highlighter
affixed to its rating.  Interest must be fixed or tied to a single interest rate
index plus a single fixed spread (if any), and move proportionately with said
index. In no event shall any such obligation have a maturity in excess of 365
days

 

“Casualty” shall mean a fire, explosion, flood, collapse, hurricane, or other
casualty affecting the Mortgaged Property.

 

“CERCLIS” shall have the meaning given such term in Section 4.15 of this
Agreement.

 

“Change in Law” shall mean (a) the adoption of any law, rule or regulation after
the date of this Agreement, (b) any change in any law, rule or regulation or in
the interpretation or application thereof by any Governmental Authority after
the date of this Agreement or (c) compliance by any Lender (or by any lending
office of such Lender or by such Lender’s

 

8

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holding company, if any) with any guideline or directive (whether or not having
the force of law) of any Governmental Authority made or issued after the date of
this Agreement.

 

“Change of Control” shall mean: (a) at any time, that PropCo shall cease to own
and control, directly, one hundred percent (100%) of the Capital Stock of
Holdco, or Holdco shall cease to own and control, directly, one hundred percent
(100%) of the Capital Stock of each of Borrower and Leasehold Holder; or (b) a
“Change of Control” as such term is defined in the PropCo Credit Agreement as in
effect as of the Effective Date.  Notwithstanding the foregoing, neither the
issuance, nor the exercise of the Warrants nor any subsequent transfer of equity
issued pursuant to a Warrant shall constitute a Change of Control.

 

“Closing Date” shall mean February 7, 2008.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended, and the
rules and regulations promulgated thereunder, as from time to time in effect.

 

“Collateral” shall mean rights, interests, and property of every kind, real and
personal, tangible and intangible upon which a Lien is granted as security for
the Loans or any of the other Obligations pursuant to the Collateral Documents
and shall include the “Collateral” as defined in the Security Agreement, the
“Pledged Collateral” as defined in each Pledge Agreement, and the Mortgaged
Property.

 

“Collateral Documents” shall mean, collectively, the Security Instruments, the
Security Agreement, the Pledge Agreement, the Control Agreements, and all other
security agreements, pledge agreements, or other similar agreements delivered to
the Administrative Agent and the Lenders from time to time that create or
purport to create a Lien in favor of the Administrative Agent for the benefit of
the Secured Parties, as the same may hereafter be Modified from time to time.

 

“Compliance Certificate” shall have the meaning given such term in
Section 5.1(4) of this Agreement.

 

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

 

“Consolidated” shall mean with respect to any Person, the consolidation of
accounts of such Person and its Subsidiaries, in conformity with GAAP. 
“Consolidation” shall have a meaning correlative thereto.

 

“Consolidated Hotel/Casino Facility EBITDA” shall mean, for any period, the
Consolidated Net Income for such period to the extent attributable to the
Hotel/Casino Facility (“Consolidated Hotel/Casino Facility Net Income”):

 

(a)           plus, without duplication and solely to the extent already
deducted (and not added back) in arriving at such Consolidated Hotel/Casino
Facility Net Income, the

 

9

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sum of the following amounts for such period to the extent attributable to the
Hotel/Casino Facility:

 

(i)            Consolidated Hotel/Casino Facility Interest Expense,

 

(ii)           income tax expense;

 

(iii)          depreciation and amortization,

 

(iv)          non-cash impairment losses,

 

(v)           non-operating, non-recurring losses on the sale of assets for such
period,

 

(vi)          losses attributable to the early extinguishment of Indebtedness,
and

 

(vii)         losses attributable to hedging obligations or other derivative
instruments,

 

(viii)        expenses actually reimbursed in cash by an Affiliate pursuant to
an expense sharing agreement;

 

(b)           minus, without duplication and solely to the extent included in
arriving at such Consolidated Hotel/Casino Facility Net Income, the sum of the
following amounts for such period to the extent attributable to the Hotel/Casino
Facility:

 

(i)            non-operating, non-recurring gains on the sale of assets for such
period,

 

(ii)           gains attributable to the early extinguishment of indebtedness,

 

(iii)          gains attributable to hedging obligations or other derivative
instruments, and

 

(iv)          payments made by the Borrower and the Leasehold Holder (without
duplication) to PropCo during such period pursuant to the Expense Sharing
Agreement.

 

(iv)          distributions made by the Borrower during such period to PropCo
for Borrower’s proportionate share of the amounts distributed by PropCo to the
Holding Companies (as defined in the PropCo Credit Agreement) pursuant to
Sections 7.06(e)(i) and (ii) and 7.06(f) of the PropCo Credit Agreement,

 

in each case, as determined on a consolidated basis for the Loan Parties in
accordance with GAAP; provided that, without duplication:

 

(A)          the following additional items shall be added to Consolidated
Hotel/Casino Facility EBITDA such period to the extent attributable to the
Hotel/Casino Facility (solely to the extent already deducted (and not added
back)

 

10

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in arriving at such Consolidated Net Income): (1) cash restructuring charges or
reserves (including restructuring costs related to acquisitions and to
closure/consolidation of facilities) incurred after the Effective Date and
unusual or non-recurring charges, including severance, relocation costs and
curtailments or modifications to pension and post-retirement employee benefit
plans; provided, that the aggregate amount under this clause (1) with respect to
any period shall not exceed 2.5% of Consolidated Hotel/Casino Facility EBITDA
for such period, (2) non-cash charges in respect of equity compensation,
(3) other extraordinary Non-Cash Charges (provided, however, that any cash
payment or expenditure made with respect to any such Non-Cash Charge shall be
subtracted in computing Consolidated Hotel/Casino Facility EBITDA during the
period in which such cash payment or expenditure is made) and (4) expenses
incurred by the Borrower and the Leasehold Holder after the Effective Date and
during such period in respect of the Restructuring through December 31, 2011, so
long as the aggregate amount of all such expenses added back pursuant to this
clause (4) for all periods does not exceed $100,000.00;

 

(B)         the following additional item shall be deducted from Consolidated
Hotel/Casino Facility EBITDA for such period to the extent attributable to the
Hotel/Casino Facility (solely to the extent included in arriving at such
Consolidated Net Income): other extraordinary non-cash gains (excluding any
non-cash gain to the extent it represents the reversal of an accrual or reserve
for a potential cash item that reduced Consolidated Hotel/Casino Facility EBITDA
in any prior period); and

 

(C)           the following additional item shall be deducted from Consolidated
Hotel/Casino Facility EBITDA for such period to the extent attributable to the
Hotel/Casino Facility: the Incentive Management Fee (as defined in the
Management Agreement) for such period.

 

“Consolidated Hotel/Casino Facility Interest Expense” means, for any period, the
interest expense, net of interest income, of the Borrower and the Leasehold
Holder attributable to the Hotel/Casino Facility for such period determined on a
consolidated basis in accordance with GAAP.

 

“Consolidated Net Income” means, for any period, the net income (loss) of
Borrower and the Leasehold Holder for such period determined on a consolidated
basis in accordance with GAAP (after deduction of the Base Management Fee (as
defined in the Management Agreement) for such period but prior to any deduction
of the Incentive Management Fee (as defined in the Management Agreement) for
such period), excluding, without duplication, the cumulative effect of a change
in accounting principles during such period to the extent included in
Consolidated Net Income.  For the avoidance of doubt, the calculation of
Consolidated Net Income for the purposes hereunder shall include deductions
(without duplication) for any and all costs and expenses of IP Holdco to the
extent actually allocated to and paid by any Loan Party pursuant to the Expense
Sharing Agreement or the HCF Management Agreement, as applicable.

 

11

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“Consolidated Working Capital” means, at any date, the excess of (a) the sum of
all amounts (other than cash and Cash Equivalents) that would, in conformity
with GAAP, be set forth opposite the caption “total current assets” (or any like
caption) on a consolidated balance sheet of the Loan Parties at such date over
(b) the sum of all amounts that would, in conformity with GAAP, be set forth
opposite the caption “total current liabilities” (or any like caption) on a
consolidated balance sheet of the Loan Parties on such date, including deferred
revenue but excluding, without duplication, (i) the current portion of any
Funded Debt, (ii) the Loans, (iii) the current portion of interest and (iv) the
current portion of current and deferred income taxes.

 

“Contact Office” shall mean the office of Deutsche Bank located at Deutsche Bank
AG Cayman Islands Branch, 60 Wall Street, MS NYC60-1110, New York, NY
10005-2858, Attention:  Loan Administration, or such other offices in New York,
New York as the Administrative Agent may notify the Borrower and the Lenders
from time to time in writing.

 

“Contractual Obligation” shall mean, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of its property is bound.

 

“Control” shall have the meaning provided in the definition of “Affiliate”.

 

“Control Agreements” shall mean, collectively, each tri-party deposit account or
securities account control agreement by and among the applicable Loan Party, the
Administrative Agent and the applicable Account Bank, and each in form and
substance satisfactory to the Administrative Agent and in any event providing to
the Administrative Agent “control” of such deposit account or securities account
within the meaning of Articles 8 and 9 of the UCC, as such deposit account or
securities account control agreements may be Modified.

 

“Counterparty” shall mean the counterparty to a Required Interest Rate Contract,
which shall be an Acceptable Counterparty.

 

“Days Inn Franchise Agreement” shall mean that certain Franchise Agreement dated
as of December 2, 2009, by and between Franchisor and Tropicana Station Inc., as
predecessor in interest to Leasehold Holder.

 

“DBTCA” shall have the meaning given to such term in the recitals to this
Agreement.

 

“Debtor Affiliates” shall have the meaning given to such term in the recitals to
this Agreement.

 

“Default Rate” shall mean a per annum rate equal to two percent (2%) above the
Applicable Base Rate in effect during the applicable calculation period (whether
or not such Applicable Base Rate shall otherwise have been elected by Borrower
in accordance with this Agreement).

 

“Deferred Management Fees” shall have the meaning given to such term in
Section 5.19(15) of this Agreement.

 

12

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“Deutsche Bank” shall have the meaning given to such term in the preamble to
this Agreement.

 

“Deutsche Bank Note” shall mean that certain Amended and Restated Note in the
aggregate principal amount of $65,786,700 evidencing Loans dated as of the
Effective Date, made by Borrower in favor of Deutsche Bank, as the same may be
Modified.

 

“Disposition” shall mean the sale, conveyance, pledge, hypothecation, ground
lease, encumbrance, creation of a security interest with respect to, or other
Transfer, whether voluntary or involuntary, direct or indirect, of any legal or
beneficial interest in any Mortgaged Property, or other Property of the Borrower
or Leasehold Holder; provided, however, that Disposition shall not include any
Permitted Encumbrances.

 

“Distribution” shall mean, with respect to any Person, (a) any distribution of
cash or Cash Equivalents, directly or indirectly, to the partners or holders of
Capital Stock of such Person, or any other distribution on or in respect of any
partnership, company or equity interests of such Person; (b) the declaration or
payment of any dividend on or in respect of any shares of any class of Capital
Stock of such Person; or (c) the purchase, redemption, or other retirement of
any shares of any class of Capital Stock of such Person, directly or indirectly.

 

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

 

“Downgrade” shall have the meaning given such term in Section 5.12(3)(ii) of
this Agreement.

 

“Effective Date” shall mean the date first written in the introductory paragraph
of this Agreement.

 

“Eligible Account” shall mean a separate and identifiable account from all other
funds held by the holding institution, which account is an account maintained
with an Approved Bank that is subject to supervision or examination by federal
and state authority.  An Eligible Account shall not be evidenced by a
certificate of deposit, passbook or other instrument.

 

“Eligible Assignee” shall mean any Person, provided, however, that no Person
shall be an “Eligible Assignee” unless at the time of the proposed assignment to
such Person:  (i) such Person is able to maintain its portion of the Loans in
Dollars, (ii) such Person, if a Foreign Lender, is exempt from withholding of
tax on interest and is able to deliver the documents related thereto pursuant to
Section 2.14(5) of this Agreement, and (iii) such Person is not a Borrower
Party, or an Affiliate thereof.

 

“Environmental Certificate” shall have the meaning given such term in
Section 5.10(2) of this Agreement.

 

“Environmental Event” shall have the meaning given such term in
Section 5.10(2) of this Agreement.

 

“Environmental Indemnity” shall mean the Amended and Restated Environmental

 

13

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Indemnity Agreement dated as of the Effective Date, made by Borrower, the
Leasehold Holder and Holdco, jointly and severally in favor of Administrative
Agent, as the same may be Modified.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
Modified, and the rules and regulations promulgated thereunder as from time to
time in effect.

 

“ERISA Affiliate” shall mean any trade or business (whether or not incorporated)
under common control with any Borrower Party within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) for purposes of
provisions relating to Section 412 of the Code).

 

“ERISA Event” shall mean (a) a Reportable Event with respect to a Pension Plan
or a Multiemployer Plan; (b) a withdrawal by any Borrower Party or any ERISA
Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan
year in which it was a substantial employer (as defined in Section 4001(a)(2) of
ERISA) or a cessation of operations which is treated as such a withdrawal under
Section 4062(e) of ERISA; (c) a complete or partial withdrawal by any Borrower
Party or any ERISA Affiliate from a Multiemployer Plan or notification that a
multiemployer is in reorganization; (d) the filing of a notice of intent to
terminate, the treatment of a plan amendment as a termination under Section 4041
or 4041A of ERISA or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) a failure by any Borrower Party  or any
ERISA Affiliate to satisfy the minimum funding standard (as defined in
Section 412 of the Code) with respect to a Pension Plan or Multiemployer Plan;
(f) an event or condition which might reasonably be expected to constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan or Multiemployer Plan; (g) the
imposition of any liability under Title IV of ERISA, other than PBGC premiums
due but not delinquent under Section 4007 of ERISA, upon any Borrower Party or
any ERISA Affiliate; (h) a determination that any Pension Plan or Multiemployer
Plan is, or is expected to be, considered an at-risk plan or a plan in
endangered or critical status within the meaning of Sections 430, 431 and 432 of
the Code or Sections 303, 304 and 305 of ERISA; or (i) an application for a
funding waiver or an extension of any amortization period pursuant to
Section 412 of the Code with respect to any Pension Plan.

 

“Eurodollar Business Day” shall mean a Business Day on which commercial banks in
London, England are open for domestic and international business.

 

“Event of Default” shall have the meaning given such term in Section 7.1 of this
Agreement.

 

“Evidence of No Withholding” shall have the meaning given such term in
Section 2.14(5) of this Agreement.

 

“Excess Cash Flow” means, for any period, an amount held by any Loan Party,
equal to the excess of:

 

(a)         the sum, without duplication, of:

 

(i)            Consolidated Net Income for such period,

 

14

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(ii)           an amount equal to the amount of all Non-Cash Charges (including
depreciation and amortization) incurred during such period to the extent
deducted in arriving at such Consolidated Net Income,

 

(iii)          decreases in Consolidated Working Capital, base stock and
long-term account receivables for such period (other than any such decreases
arising from acquisitions by Borrower and the Leasehold Holder during such
period),

 

(iv)          the amount of income tax expense deducted in determining
Consolidated Net Income for such period,

 

(v)           all amounts paid by the counterparty under the Required Interest
Rate Contracts to the Borrower or the Leasehold Holder solely to the extent not
already included in determining Consolidated Net Income for such period, and

 

(vi)          the amount of any payment or compensation received by Borrower or
Leasehold Holder with respect to any Disposition not required to be remitted to
Administrative Agent pursuant to Section 6.4(3)(ii) solely to the extent not
already included in arriving at Consolidated Net Income for such period.

 

less

 

(b)           the sum, without duplication and solely to the extent included in
arriving at such Consolidated Net Income, of:

 

(i)            an amount equal to the amount of all non-cash credits included in
arriving at such Consolidated Net Income,

 

(ii)           the amount of Capital Expenditures made in cash during such
period pursuant to the Approved Budget,

 

(iii)          the aggregate amount of voluntary prepayments of the principal
amounts outstanding under the Loans made pursuant to Section 2.5(2) and
mandatory prepayments of principal amounts outstanding under the Loans made
pursuant to Section 2.5(1)(i), each as made during such period,

 

(iv)          the aggregate amount of all principal payments of Permitted Debt
of Borrower and the Leasehold Holder made during such period (other than trade
accounts payable in the Ordinary Course of Business) except to the extent
financed with the proceeds of other Indebtedness of Borrower or the Leasehold
Holder, other than to the extent such proceeds were included in arriving at such
Consolidated Net Income,

 

(v)           an amount equal to the payments made by Borrower during such
period pursuant to the Tax Sharing Agreement solely to the extent not already
deducted in arriving at Consolidated Net Income,

 

(vi)          an amount equal to the payments made by Borrower during such
period for Incentive Management Fees (as defined in the applicable Management

 

15

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Agreement) pursuant to the Management Agreements,

 

(vii)         an amount equal to the payments made by Borrower during such
period for its share of expenses pursuant to the Expense Sharing Agreement
solely to the extent not already deducted in arriving at Consolidated Net
Income, and

 

(viii)        increases in Consolidated Working Capital, base stock and
long-term account receivables for such period (other than any such increases
arising from acquisitions by Borrower and the Leasehold Holder during such
period).

 

“Excluded Accounts” shall mean those accounts of Borrower or Leasehold Holder
which are (a) payroll accounts so long as such payroll accounts are zero balance
deposit accounts, (b) withholding tax and fiduciary accounts, (c) deposit
accounts that are not permitted to be subject to a lien pursuant to Gaming Law,
and (d) those accounts identified on Schedule 4.27 identified as “Excluded
Accounts”.

 

“Excluded Taxes” shall mean, with respect to the Administrative Agent, any
Lender, or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) income or franchise taxes imposed on
(or measured by) its net income by the United States of America, or by any
state, locality or foreign jurisdiction under the laws of which such recipient
is organized, (b) any branch profits taxes imposed by the United States of
America or any similar tax imposed by any other jurisdiction in which the
Borrower is located, (c) any taxes that are imposed by reason of FATCA,  and
(d) in the case of a Foreign Lender, any withholding tax that is imposed on
amounts payable to such Foreign Lender at the time such Foreign Lender becomes a
party to this Agreement or is attributable to such Foreign Lender’s failure to
comply with Section 2.14(5) of this Agreement except to the extent that such
Foreign Lender (or its assignor, if any) was entitled at the time of designation
of a new lending office (or assignment or participation), to receive additional
amounts from the Borrower with respect to such withholding Taxes pursuant to
Section 2.14(1) and ; provided, however, Excluded Taxes shall not include any
withholding tax resulting from any inability to comply with Section 2.14(5) of
this Agreement solely by reason of there having occurred a Change in Law.

 

“Executive Order” shall have the meaning given such term in Section 4.26(1) of
this Agreement.

 

“Existing Leases” shall have the meaning given to such term in the definition of
“Approved Leases”.

 

“Existing Loans” shall mean all Loans (as such term is defined in the Original
Credit Agreement) made by the Lenders pursuant to the Original Credit Agreement,
each being, individually, an “Existing Loan”.

 

“Expense Sharing Agreement” shall mean that certain Cost Sharing Agreement,
dated June 16, 2011 by and among Propco, Borrower and Leasehold Holder.

 

“Extension Fee” shall mean a fee equal to one percent (1.0%) of the
then-outstanding aggregate principal balance of the Loans, which shall be
payable to the Lenders pro

 

16

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rata in accordance with the respective unpaid principal amounts of the Loans
held by them.

 

“Extension Request” shall have the meaning given such term in
Section 2.3(b)(1) of this Agreement.

 

“Facility” shall have the meaning given such term in Section 2.1 of this
Agreement.

 

“FATCA” shall mean Sections 1471, 1472, 1473 or 1474 of the Code as in effect on
the Effective Date and the regulations or guidance promulgated thereunder.

 

“Federal Funds Rate” shall mean 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 for such 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 1:00 p.m. (New York time) on such day
on such transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by the Administrative Agent in its
sole discretion.

 

“Fertitta Entertainment” shall mean Fertitta Entertainment LLC, a Delaware
limited liability company.

 

“FF&E” shall mean all furniture, furnishings, fixtures, equipment and all other
items of personal property customarily used in connection with the operation of
the Mortgaged Property.

 

“First Extended Maturity Date” means June 17, 2017.

 

“First Extension Term” means the time period commencing on the day after the
Original Maturity Date and ending on the First Extended Maturity Date.

 

“Fiscal Quarter” or “fiscal quarter” shall mean any 3-month period ending on
March 31, June 30, September 30 or December 31 of any Fiscal Year.

 

“Fiscal Year” or “fiscal year” shall mean the 12-month period ending on
December 31 in each year or such other period as any Borrower may designate and
the Administrative Agent may approve in writing.

 

“Foreign Lender” shall mean any Lender that is not a United States person within
the meaning of Section 7701(a)(30) of the Code.

 

“Franchise Agreement” shall mean the Days Inn Franchise Agreement and any other
franchise agreement, license agreement or other agreement providing for a
franchise or permitting the use of a trade name or a brand in connection with
the operation of the hotel at the Hotel/Casino Facility entered into by Borrower
or Leasehold Holder with respect to the Mortgaged Property pursuant to the terms
of this Agreement.

 

17

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“Franchisor” shall mean Days Inns Worldwide, Inc. or any other franchisor,
licensor or other entity providing or permitting a franchise, trade name or
other use of a brand at the Hotel/Casino Facility pursuant to a Franchise
Agreement.

 

“Funded Debt” means all Permitted Debt of Borrower and the Leasehold Holder
consisting of borrowed money that matures more than one year from the date of
its creation or matures within one year from such date that is renewable or
extendable, at the option of such Person, to a date more than one year from such
date or arises under a revolving credit or similar agreement that obligates the
lender or lenders to extend credit during a period of more than one year from
such date.

 

“GAAP” means generally accepted accounting principles in the United States of
America, as in effect from time to time; provided, however, that if the Borrower
notifies the Administrative Agent that the Borrower requests an amendment to any
provision hereof to eliminate the effect of any change occurring after the
Effective Date in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Borrower that the
Required Lenders request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change in
GAAP or in the application thereof, then such provision shall be interpreted on
the basis of GAAP as in effect and applied immediately before such change shall
have become effective until such notice shall have been withdrawn or such
provision amended in accordance herewith.

 

“Gaming” shall have the meaning ascribed to such term in Nevada Revised Statutes
Section 463.0153.

 

“Gaming Authority” shall mean any applicable governmental or administrative
state or local agency, authority, board, bureau, commission, department or
instrumentality of any nature whatsoever involved in the supervision or
regulation of casinos, gaming and/or gaming activities, including, without
limitation, the Nevada Gaming Commission, the Nevada State Gaming Control Board,
and any of their respective successors or replacements.

 

“Gaming Law” shall mean all Requirements of Law pursuant to which a Gaming
Authority possesses licensing, permit or regulatory authority over casinos,
gaming and/or gaming activities conducted within its jurisdiction.

 

“Gaming Permits” shall mean, collectively, every license, permit, approval,
registration, finding of suitability, waiver, exemption or other authorization
required to own, operate and otherwise conduct non-restricted gaming operations
granted or issued by the Nevada Gaming Authorities.

 

“Good Faith Contest” shall mean the contest of an item if (a) no Event of
Default shall exist and be continuing; (b) the item is diligently contested in
good faith, and, if appropriate, by proceedings timely instituted, (c) the
Borrower shall keep the Administrative Agent informed of the status of such
contest at reasonable intervals; (d) in the event the Borrower is not providing
security as provided in clause (e) below, adequate reserves are established in
accordance with GAAP with respect to the contested item; (e) either such contest
operates to suspend collection or enforcement (as the case may be) of the
contested item or the

 

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Borrower has deposited with Administrative Agent a bond in the amount of the
contested item; (f) in the case of any contested items which are not bonded in
excess of $2,000,000 or $10,000,000 in the aggregate, during such contest,
Borrower, shall deposit with or deliver to the Agent either cash and Cash
Equivalents or a letter of credit in an amount equal to 110% of (i) the amount
of Borrower’s obligations being contested plus (ii) any additional interest,
charge, or penalty arising from such contest; (g) the failure to pay or comply
with the contested item during the period of the contest is not reasonably
likely to result in a Material Adverse Effect, and (h) in the case of the Ground
Lease Parcel, such action is permitted under the Ground Lease and no default
under Ground Lease may, or is reasonably likely to occur, as a result of the
contest of such item.

 

“Governmental Approvals” means all permits, licenses, consents, approvals,
declarations, concessions, orders, filings, notices, findings of suitability,
entitlements, waivers, variances, certificates and other authorizations granted
or issued by any agency(ies) of the City of Las Vegas, Nevada, Clark County,
Nevada, the State of Nevada and the United States necessary for the operation of
the Hotel/Casino Facility (including, without limitation, as required under any
Gaming Laws).

 

“Governmental Authority” shall mean any nation or government, any state or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any court or other entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, including, without limitation, all Gaming Authorities.

 

“Ground Lease” “ shall mean that certain Lease dated May 7, 1998, by and between
Ground Lease Fee Owner, as landlord, and Leasehold Holder, as tenant, as amended
by that certain First Amendment to Lease effective as of December 31, 2008, and
as further amended by that certain Second Amendment of Lease, dated as of May,
16, 2011, affecting the Ground Lease Parcel, as the same may be Modified.

 

“Ground Lease Fee Owner” shall mean J. A. Tiberti Construction Company, Inc., a
Nevada corporation, the owner of the fee simple estate in the Ground Lease
Parcel, and any successor or assignee thereof.

 

“Ground Lease Parcel” shall mean certain land assemblage located in the Las
Vegas, Nevada metropolitan area located near Tropicana Avenue adjacent to
Interstate 15, as more particularly described on Schedule 1.1E.

 

“Ground Lease Parcel Acquisition Closing Date” means the scheduled closing date,
if any, of the Leasehold Holder’s acquisition of the Ground Lease Parcel, which
closing date may be modified from time to time in accordance with the terms of
the Ground Lease.

 

“Ground Lease Parcel Purchase Option”  shall mean the option of the Leasehold
Holder and/or Borrower to purchase the Ground Lease Fee Owner’s interest in the
Ground Lease Parcel pursuant to sections 12.01 through 12.20 of the Ground
Lease.

 

“Ground Rent” shall mean the aggregate amount of all rent and other amounts
payable by the Leasehold Holder pursuant to the Ground Lease.

 

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“Guaranteed Obligations” shall mean the full and prompt payment when due
(whether at the stated maturity, by acceleration or otherwise) of the principal
and interest on each Note issued by, and all Loans to Borrower under this
Agreement, together with all the other obligations (including obligations which,
but for the automatic stay under Section 362(a) of the Bankruptcy Code, would
become due), indebtedness and liabilities (including, without limitation,
indemnities, fees and interest (including any interest accruing after the
commencement of any proceeding with respect to any Loan Party under the
Bankruptcy Code or similar debtor relief laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally at the rate provided for herein, whether or not such
interest is an allowed claim in any such proceeding) thereon) of Borrower to the
Lenders and the Administrative Agent now existing or hereafter incurred under,
arising out of or in connection with this Agreement and each other Loan Document
to which Borrower is a party and the due performance and compliance by Borrower
with all the terms, conditions and agreements contained in this Agreement and in
each such other Loan Document.

 

“GVG Parcel” shall have the meaning given such term in Section 5.10(4) of this
Agreement.

 

“Hazardous Materials” shall mean any flammable materials, explosives,
radioactive materials, hazardous or toxic wastes, substances or materials,
including, without limitation, any substances defined as or included in the
definitions of “contaminants,” “pollutants,” “hazardous substances,” “hazardous
wastes,” “hazardous materials,” or “toxic substances” under any applicable
federal, state, or local laws or regulations, taking into account applicable
concentration levels.

 

“Hazardous Materials Laws” shall mean any federal, state or local statute,
regulation or ordinance or any judicial or administrative decree or decision,
whether now existing or hereinafter enacted, promulgated or issued, with respect
to the protection of human health from any environmental hazards (as relating to
exposure to such environmental hazards), or the environment, or any Hazardous
Materials, wetlands, landfills, open dumps, storage tanks, underground storage
tanks, solid waste, waste water, storm water run-off, waste emissions or wells. 
Without limiting the generality of the foregoing, the term shall encompass each
of the following statutes, and regulations promulgated thereunder, and
amendments and successors to such statutes and regulations, as may be enacted
and promulgated from time to time:  (i) the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 (codified in scattered sections
of 26 U.S.C.; 33 U.S.C.; 42 U.S.C. and 42 U.S.C. §9601 et seq.); (ii) the
Resource Conservation and Recovery Act of 1976 (42 U.S.C. §6901 et seq.);
(iii) the Hazardous Materials Transportation Act (49 U.S.C. §1801 et seq.);
(iv) the Toxic Substances Control Act (15 U.S.C. §2061 et seq.); (v) the Clean
Water Act (33 U.S.C. §1251 et seq.); (vi) the Clean Air Act (42 U.S.C. §7401 et
seq.); (vii) the Safe Drinking Water Act (21 U.S.C. §349; 42 U.S.C. §201 and
§300f et seq.); (viii) the National Environmental Policy Act of 1969 (42 U.S.C.
§4321); (ix) the Superfund Amendment and Reauthorization Act of 1986 (codified
in scattered sections of 10 U.S.C., 29 U.S.C., 33 U.S.C. and 42 U.S.C.); and
(x) Title III of the Superfund Amendment and Reauthorization Act (40 U.S.C.
§1101 et seq.).

 

“HCF Management Agreement” shall mean that certain Management Agreement for Wild
Wild West Gambling Hall & Hotel, dated as of the Effective Date, by and between

 

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Leasehold Holder and HCF Manager, together with all amendments and other
Modifications thereto and replacements thereof approved in writing by
Administrative Agent.

 

“HCF Manager” shall mean FE Landco Management LLC, a Delaware limited liability
company.

 

“Hedging Contracts” shall mean all Interest Rate Contracts, foreign exchange
contracts, currency swap or option agreements, forward contracts, commodity
swap, purchase or option agreements, other commodity price hedging arrangements,
and all other similar agreements or arrangements designed to alter the rights of
any Person arising from fluctuations in interest rates, currency values or
commodity prices.

 

“Holdco” shall mean NP Landco Holdco LLC, a Nevada limited liability company.

 

“Holdco Pledge Agreement” shall mean that certain Pledge Agreement dated as of
the Effective Date, executed by Holdco, pursuant to which Holdco pledged to
Administrative Agent, for the benefit of the Secured Parties, all of Holdco’s
ownership interests in Borrower and Leasehold Holder, as Modified.

 

“Hotel/Casino Facility” shall mean, collectively, the Wild Wild West Gambling
Hall and Days Inn Hotel located on the Ground Lease Parcel as of the Effective
Date, together with all additional and successor hotel and gaming or casino
facilities located on the Mortgaged Property from time to time thereafter,
together with all pools, parking lots and other facilities and amenities related
to any of the foregoing.

 

“Impositions” shall mean all taxes (including all ad valorem, sales (including
those imposed on lease rentals), use, single business, gross receipts, value
added, intangible transaction, privilege or license or similar taxes),
governmental assessments (including all assessments for public improvements or
benefits, whether or not commenced or completed prior to the date of this
Agreement and whether or not commenced or completed within the term of this
Agreement), water, sewer or other rents and charges, excises, levies, fees
(including license, permit, inspection, authorization and similar fees), and all
other governmental charges, in each case whether general or special, ordinary or
extraordinary, or foreseen or unforeseen, of every character in respect of the
Mortgaged Property and/or any Rents and Ground Rent (including all interest and
penalties thereon), which at any time prior to, during or in respect of the term
of the Loans may be assessed or imposed on or be a Lien upon (a) Borrower
(including all income, franchise, single business or other taxes), (b) the
Mortgaged Property or any other Collateral, or any Rents therefrom or any
estate, right, title or interest therein, or (c) any occupancy, operation, use
or possession of, or sales of or from, or activity conducted on, or in
connection with the Mortgaged Property.  Nothing contained in this Agreement
shall be construed to require Borrower to pay any tax, assessment, levy or
charge imposed on any (i) Tenant, (ii) Agent or (iii) Lender in the nature of a
capital levy, estate, inheritance, succession, income or net revenue tax.

 

“Improvements” shall mean, collectively, all the “Improvements” as such term is
defined and set forth in each of the Security Instruments, and shall include all
the “Improvements” as defined in any of such Security Instruments.

 

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“Indebtedness” of any Person shall mean without duplication (a) all indebtedness
of such Person for borrowed money, (b) all obligations of such Person evidenced
by notes, bonds, debentures or similar instruments that bear interest, (c) all
reimbursement and other obligations with respect to letters of credit and
bankers’ acceptances, (d) all indebtedness for the deferred purchase price of
property or services, other than trade payables incurred in the Ordinary Course
of Business that are not overdue, (e) all indebtedness of such Person created or
arising under any conditional sale or other title retention agreement with
respect to Property acquired by such Person (even though the rights and remedies
of the seller or lender under such agreement in the event of default are limited
to repossession or sale of such Property), (f) all capital lease obligations of
such Person and the present value of future rental payments under all synthetic
leases, (g) all guaranty obligations of such Person with respect to obligations
of another Person that would otherwise constitute Indebtedness hereunder,
(h) all obligations of such Person to purchase, redeem, retire, defease or
otherwise acquire for value any stock or stock equivalents of such Person,
valued, in the case of redeemable preferred stock, at the greater of its
voluntary liquidation preference and its involuntary liquidation preference plus
accrued and unpaid dividends, (i) all payments that such Person would have to
make in the event of an early termination on the date Indebtedness of such
Person is being determined in respect of Hedging Contracts of such Person,
(j) for the purposes of Section 7.1(5) only, all obligations of such Person in
respect of Interest Rate Contracts, and (k) all Indebtedness of the type
referred to above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any lien upon or
in Property (including accounts and general intangibles) owned by such Person,
even though such Person has not assumed or become liable for the payment of such
Indebtedness but only to the extent of the lesser of (x) the amount of such
Indebtedness and (y) the fair market value of the Property securing such
Indebtedness.

 

“Indemnified Liabilities” shall have the meaning given such term in
Section 10.14 of this Agreement.

 

“Indemnified Person” shall have the meaning given such term in Section 10.14 of
this Agreement.

 

“Indemnified Taxes” shall mean Taxes, other than Excluded Taxes, imposed in
connection with or with respect to (i) the Facility; (ii) any Mortgaged Property
or other Collateral for the Facility, or any Property of a Borrower Party with
respect to the Facility or the Loan Documents; (iii) in respect of any
transactions contemplated under the Loan Documents; or (iv) any revenue or
income derived from clauses (i) through (iii) above.

 

“Insurance Premiums” shall have the meaning given such term in Section 6(c) of
Schedule 5.5 of this Agreement.

 

“Interest Period” shall mean the period commencing on the Effective Date of this
Agreement and ending on (but excluding) the first Payment Date after the
Effective Date, and each succeeding one month period thereafter; each Interest
Period commencing on (and including) the Payment Date upon which the immediately
preceding Interest Period ends and ending on (but excluding) the next following
Payment Date.

 

“Interest Rate Contracts” shall mean all interest rate swap agreements, interest

 

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rate cap agreements, interest rate collar agreements and interest rate insurance
(in each case together with the confirmation and schedules relating thereto),
together with any Modifications thereto.

 

“Interest Rate Determination Date” shall mean, with respect to any Interest
Period, the date that is two Business Days prior to the first day of such
Interest Period.

 

“Investment” shall mean, with respect to any Person, (a) any purchase or other
acquisition by that Person of Securities, or of a beneficial interest in
Securities, issued by any other Person, (b) any purchase by that Person of a
Property or assets (Real Property or Personal Property) from a Person, and
(c) any loan (other than loans to employees), advance (other than deposits with
financial institutions available for withdrawal on demand, prepaid expenses,
accounts receivable, advances to employees and similar items made or incurred in
the Ordinary Course of Business) or capital contribution by that Person to any
other Person, including, without limitation, all Indebtedness to such Person
arising from a sale of property by such Person other than in its Ordinary Course
of Business.  The amount of any Investment shall be the original cost of such
Investment, plus the cost of all additions thereto less the amount of any return
of capital or principal to the extent such return is in cash with respect to
such Investment without any adjustments for increases or decreases in value or
write-ups, write-downs or write-offs with respect to such Investment.

 

“IP Holdco” shall mean NP IP Holdings, LLC, a Nevada limited liability company.

 

“IRS” shall mean the Internal Revenue Service or any entity succeeding to any of
its principal functions under the Code.

 

“Joint Lead Arrangers” shall mean Deutsche Bank Securities Inc. and J.P. Morgan
Securities Inc., in their respective capacity as joint lead arranger for the
Facility, together with their respective permitted successors and assigns.

 

“Joint Venture” shall mean, as to any Person:  (a) any corporation fifty percent
(50%) or less 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 Subsidiaries or by such Person and one or more
of its Subsidiaries, or (b) any partnership, limited liability company,
association, joint venture or similar business organization fifty percent (50%)
or less of the ownership interests having ordinary voting power of which shall
at the time be so owned or controlled.

 

“JPMorgan” shall have the meaning given to such term in the preamble of this
Agreement.

 

“JPMorgan Note” shall mean that certain Amended and Restated Note in the
aggregate principal amount of $39,213,300 evidencing Loans dated as of the
Effective Date, made by Borrower in favor of JPMorgan, as the same may be
Modified.

 

“Knowledge” shall mean the current actual knowledge of any Responsible Officer
of Borrower, the Leasehold Holder or any other Borrower Party who have actual
knowledge of

 

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the relevant subject matter.

 

“Land Management Agreement” shall mean that certain Property Management and
Leasing Agreement, dated February 7, 2008, between Borrower, as
successor-in-interest to Tropicana Acquisitions, LLC, and Land Manager, as
amended by that certain First Amendment to Management Agreement dated April 23,
2008, as further amended by that certain Second Amendment to Management
Agreement dated May 15, 2008, as further amended by that certain Third Amendment
to Management Agreement dated June 30, 2008, and as further amended by that
certain Fourth Amendment dated December 17, 2008, together with all amendments
and other Modifications thereto and replacements thereof approved in writing by
Administrative Agent, relating to the management of the Mortgaged Property other
than the Hotel/Casino Facility.

 

“Land Manager” shall mean Gatski Commercial Real Estate Services, a Nevada
corporation, or such other entity as shall be expressly approved in writing by
the Administrative Agent.

 

“Lease” shall mean any lease, sublease or subsublease, letting, license,
concession, or other agreement (whether written or oral and whether now or
hereafter in effect) pursuant to which any Person is granted or permitted to
have by Borrower or the Leasehold Holder a possessory interest in, or right to
use or occupy all or any portion of any space in the Mortgaged Property or any
facilities at the Mortgaged Property, and every Modification thereto and every
guarantee of the performance and observance of the covenants, conditions and
agreements to be performed and observed by the other party thereto, provided,
that the term “Lease” shall not include the Ground Lease (but shall include any
subleases and sub-subleases thereunder).

 

“Leasehold Estate” means the estate in the Ground Lease Parcel created by the
Ground Lease.

 

“Leasehold Holder” shall have the meaning given to such term in the preamble to
this Agreement.

 

“Leasehold Holder Mortgaged Property” shall mean, collectively, all the
“Mortgaged Property” as such term is defined and set forth in the Security
Instrument executed by Leasehold Holder on or about the date hereof, and shall
include all the “Mortgaged Property” as defined in any of such Security
Instrument.

 

“Leasehold Holder Warrant Agreement” means that certain Warrant Purchase and
Securityholder Agreement, dated as of June 17, 2011, between Leasehold Holder,
Holdco, German American Capital Corporation, a Maryland corporation and
JPMorgan.

 

“Leasehold Holder Warrants” means the “Warrants” as defined in the Leasehold
Holder Warrant Agreement.

 

“Lender Parties” shall have the meaning given such term in Section 10.23 of this
Agreement.

 

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“Lenders” shall mean each of the lenders from time to time party to this
Agreement, including any Assignee permitted pursuant to Section 10.8 of this
Agreement.

 

“LIBO Rate” shall mean, with respect to any Interest Period, the per annum rate
for such Interest Period and for an amount equal to the amount of the applicable
Loan shown on Reuters Screen LIBOR01 (or any equivalent successor page) at
approximately 11:00 (London time) two Eurodollar Business Days prior to the
first day of such Interest Period or if such rate is not quoted, the arithmetic
average as reasonably determined by the Administrative Agent of the rates at
which deposits in immediately available Dollars in an amount equal to the amount
of the applicable Loan having a maturity approximately equal to such Interest
Period are offered to four (4) reference banks to be selected by the
Administrative Agent in the London interbank market, at approximately 11:00 a.m.
(London time) two Eurodollar Business Days prior to the first day of such
Interest Period.

 

“LIBO Rate Loan” shall mean a Loan bearing interest at a rate determined by
reference to the LIBO Rate.

 

“LIBO Rate Spread” shall mean: (a) during the Original Term, three and one half
percent (3.5%); (b) during the First Extension Term (provided Borrower exercises
its first Option to Extend in accordance with the terms of Section 2.3 hereof),
four and one half percent (4.5%); and (c) during the Second Extension Term
(provided Borrower exercises its second Option to Extend in accordance with the
terms of Section 2.3 hereof), five and one half percent (5.5%). In the event the
Obligations are not repaid in full on the Maturity Date, the LIBO Rate Spread
for all periods after the Maturity Date until all Obligations are repaid in full
shall be the LIBO Rate Spread in effect on the day prior to the Maturity Date.

 

“LIBO Reserve Percentage” shall mean with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves and taking into account any transitional
adjustments) which is imposed under Regulation D on eurocurrency liabilities. 
As of the Effective Date, the LIBO Reserve Percentage is zero, provided,
however, there can be no assurance as to what such amount may be in the future.

 

“Licenses” shall have the meaning given such term in Section 4.22(7) of this
Agreement.

 

“License Revocation” means (i) the denial, revocation or suspension of any
Material Nevada Governmental Approval of the HCF Manager, Fertitta Entertainment
or any Loan Party by any Governmental Authority; or (ii) the filing of a
disciplinary complaint by a Governmental Authority seeking the denial,
revocation or suspension of any Material Nevada Governmental Approval of the HCF
Manager, Fertitta Entertainment or any Loan Party; provided, that each of the
HCF Manager, Fertitta Entertainment and the applicable Loan Parties shall have
the greater of (a) ninety (90) days from the date of filing of such disciplinary
complaint or (b) such time period as may be granted by the applicable
Governmental Authority to cure any event or deficiency giving rise to the filing
of such disciplinary complaint such that the complaint is dismissed or settled
without a denial, revocation or suspension of such Material Nevada Governmental
Approval.  Notwithstanding any applicable cure period set forth in clause

 

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(ii) above, if a Material Nevada Governmental Approval of the HCF Manager,
Fertitta Entertainment or any Loan Party is denied, revoked or suspended by any
Governmental Authority, a “License Revocation” shall be deemed to have occurred
on the effective date of such denial, revocation or suspension.

 

“Lien” shall mean any mortgage, deed of trust, lien, pledge, hypothecation,
assignment, security interest, or any other encumbrance or charge on or
affecting Borrower, Leasehold Holder, the Collateral, any portion thereof or any
interest therein, including, without limitation, any conditional sale or other
title retention agreement, any financing lease having substantially the same
economic effect as any of the foregoing, the filing of any financing statement,
and the filing of mechanic’s, materialmen’s and other similar liens and
encumbrances.

 

“Loan” shall mean any loan made by any Lender pursuant to this Agreement.

 

“Loan Documents” shall mean, collectively, this Agreement, the Note, the
Recourse Guaranty, the Security Instruments, the Pledge Agreement, the
Assignment of Interest Rate Contracts (if any), the Acknowledgments (if any),
the Environmental Indemnity, the Assignment of Contracts, the Assignment of
Leases and Rents, the Security Agreement, the Control Agreements, and all other
documents executed and/or delivered by Borrower Parties in connection with the
Loans including any certifications or representations delivered by or on behalf
of Borrower Parties.

 

“Loan Parties” shall mean, collectively, Borrower and Leasehold Holder and
Holdco, each being, individually, a “Loan Party”.

 

“Management Agreements” shall mean, collectively, the HCF Management Agreement
and the Land Management Agreement, each being, individually, a “Management
Agreement”.

 

“Managers” shall mean, collectively, the HCF Manager and the Land Manager, each
being, individually, a “Manager”.

 

“Margin Stock” shall mean “margin stock” as defined in Regulation U.

 

“Material Adverse Effect” shall mean any change, occurrence, event, circumstance
or development that has had or could reasonably be expected to have a material
adverse effect on (a) the business, property, condition (financial or
otherwise), operation or performance of the (i) Recourse Guarantor,
(ii) Borrower or Leasehold Holder or (iii) Holdco, taken as a whole, (b) the
ability of the Borrower and the other Borrower Parties (taken as a whole), to
perform their payment obligations under the Loan Documents as and when such
obligations are required to be performed thereunder, (c) the validity or
enforceability of any of the Loan Documents or Specified Interest Rate Contract
or the rights and remedies of the Administrative Agent and other Secured Parties
under any Loan Document or Specified Interest Rate Contract or (d) the Liens in
favor of the Administrative Agent on the Collateral or the priority of such
Liens.

 

“Material Agreements” shall mean the agreements set forth on Schedule 1.1C.

 

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“Material Casualty” shall have the meaning given such term in
Section 5.5(2)(iii).

 

“Material Condemnation” shall have the meaning given such term in
Section 5.5(6).

 

“Material Nevada Governmental Approval” means any material Governmental Approval
(including any Gaming Permit) issued by any Governmental Authority including any
agency(ies) of the City of Las Vegas, Nevada, Clark County, Nevada or the State
of Nevada, the denial, revocation or suspension of which would have a Material
Adverse Effect.

 

“Maturity Date” shall mean either: (a) the Original Maturity Date; (b) the First
Extended Maturity Date, if the term of the Loans is so is extended pursuant to
and in accordance with Section 2.3 hereof; (c) the Second Extended Maturity
Date, if the term of the Loans is so extended pursuant to and in accordance with
Section 2.3 hereof; or (d) such earlier date that the Loans become due as a
result of acceleration.

 

“Modifications” shall mean any amendments, supplements, modifications, renewals,
replacements, restatements, reaffirmations, consolidations, severances,
substitutions and extensions of any document or instrument from time to time;
“Modify,” “Modified” or related words shall have meanings correlative thereto.

 

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

 

“Mortgaged Property” shall mean, collectively, all the Borrower Mortgaged
Property and Leasehold Holder Mortgaged Property.

 

“Multiemployer Plan” any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which any Borrower Party or any ERISA Affiliate
makes or is obligated to make contributions, or during the preceding five plan
years, has made or been obligated to make contributions.

 

“Non-Cash Charges” means (a) non-cash losses on asset sales, disposals or
abandonments, (b) any non-cash impairment charge or asset write-off related to
intangible assets, long-lived assets, and investments in debt and equity
securities pursuant to GAAP, (c) all non-cash losses from investments recorded
using the equity method, (d) stock-based awards compensation expense, and
(e) other non-cash charges (provided that if any non-cash charges referred to in
this clause (e) represent an accrual or reserve for potential cash items in any
future period, the cash payment in respect thereof in such future period shall
be subtracted from Consolidated Hotel/Casino Facility EBITDA or Excess Cash Flow
to such extent, and excluding amortization of a prepaid cash item that was paid
in a prior period).

 

“Note” shall collectively mean the Deutsche Bank Note, the JPMorgan Note and
each promissory note evidencing Loans hereafter issued by the Borrower at the
request of a Lender or Administrative Agent from time to time as the same may be
Modified.

 

“NPL” shall have the meaning given such term in Section 4.15 of this Agreement.

 

“NRS” means the Nevada Revised Statutes as in effect from time to time.

 

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“Obligations” shall mean any and all debts, obligations and liabilities of the
Borrower, Leasehold Holder, Holdco or the other Borrower Parties to the
Administrative Agent, the other Agents and the Lenders (or, in the case of any
Specified Interest Rate Contract, any affiliate of any Lender), whether now
existing or hereafter arising, voluntary or involuntary, whether or not jointly
owed with others, direct or indirect, absolute or contingent, liquidated or
unliquidated, and whether or not from time to time decreased or extinguished and
later increased, created or incurred (but without duplication), arising out of
or related to the Loan Documents or any Specified Interest Rate Contract.

 

“Officer’s Certificate” shall mean as to any entity, a certificate executed on
behalf of such entity by a Responsible Officer.

 

“Option Agreement” shall mean that certain Option to Acquire Property and Escrow
Instructions between the Option Parcels Fee Owner, as seller, and Borrower, as
buyer, dated May 16, 2011, together with any Modifications thereto.

 

“Option Parcels” shall mean those certain real property parcels located on the
western border of and contiguous to the Wild Wild West Assemblage in which
Leasehold Holder has an option to purchase said properties under the Option
Agreement, as such parcels are legally described on Schedule 1.1B.

 

“Option Parcel(s) Acquisition Closing Date” means the scheduled closing date of
Borrower’s acquisition of any Option Parcels, which closing date may be modified
from time to time in accordance with the terms of the Option Agreement.

 

“Option Parcels Fee Owner” shall mean The Tiberti Company, a Nevada general
partnership and any successor fee owner of the Option Parcels.

 

“Option Parcels Purchase Option” shall mean the option to purchase one or more
of the Options Parcels pursuant to the terms and conditions set forth in the
Option Agreement.

 

“Option to Extend” shall have the meaning ascribed to such term in
Section 2.3(b) hereof.

 

“Ordinary Course of Business” shall mean, with respect to a specific Person, the
ordinary course of such Person’s business, undertaken by such Person in good
faith and not for purposes of evading any covenant or restriction in any Loan
Document.

 

“Organizational Documents” shall mean:  (a) for any corporation, the certificate
or articles of incorporation, the bylaws, any certificate of designation or
instrument relating to the rights of preferred shareholders of such corporation,
and any stockholders agreement, (b) for any partnership, the partnership
agreement, any certificate of limited partnership or formation, and any other
instrument or agreement relating to the rights between or among the partners or
pursuant to which such partnership is formed, (c) for any limited liability
company, the operating agreement, any articles of organization or formation, and
any other instrument or agreement relating to the rights between the members,
pertaining to the manager, or pursuant to which such limited liability company
is formed, and (d) for any trust, the trust agreement and any other instrument
or agreement relating to the rights between the trustors, trustees and
beneficiaries, or

 

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pursuant to which such trust is formed.

 

“Original Credit Agreement” shall have the meaning ascribed to such term in the
recitals to this Agreement.

 

“Original Maturity Date” shall mean June 17, 2016.

 

“Original Term” shall mean the period of time commencing on the Closing Date and
ending on the Original Maturity Date.

 

“Originating Lender” shall have the meaning given such term in
Section 10.8(4) of this Agreement.

 

“Other Charges” shall mean maintenance charges, impositions other than
Impositions, and any other charges, including, without limitation, vault charges
and license fees for the use of vaults, chutes and similar areas adjoining the
Mortgaged Property, now or hereafter levied or assessed or imposed against the
Mortgaged Property or any part thereof by any Governmental Authority, other than
those required to be paid by a Tenant pursuant to its respective Lease.

 

“Other Taxes” shall mean any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies of a
Governmental Authority with respect to any payment made under any Loan Document
or from the execution, delivery or enforcement of any Loan Document.

 

“Participant” shall have the meaning given such term in Section 10.8(4) of this
Agreement.

 

“Payment Date” shall mean the last Business Day of each calendar month.

 

“Payment Guarantor” shall mean collectively or individually, as the context
requires, Leasehold Holder and Holdco, each being individually, a “Payment
Guarantor”.

 

“Payment Guaranty” shall mean the guaranty of the Payment Guarantor pursuant to
Article XI of this Agreement.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation or any entity
succeeding to any of its principal functions under ERISA.

 

“Pension Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Section 412 of the Code or Section 302 or Title IV of ERISA and is
sponsored or maintained by any Loan Party or any ERISA Affiliate or to which any
Borrower Party or any ERISA Affiliate contributes or has an obligation to
contribute.

 

“Permitted Debt” shall mean, collectively,

 

(a)           the Obligations; and

 

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(b)           trade payables and other similar liabilities incurred in the
Ordinary Course of Business of a Loan Party in connection with the Approved
Leases, the operation of the Hotel/Casino Facility, the performance of Capital
Expenditures included in the Approved Budget or as otherwise approved by
Administrative Agent in its reasonable discretion, which liabilities shall not
be secured by Liens on the Collateral, and provided that each such amount shall
be paid within sixty (60) days following the date on which each such amount is
due.

 

(c)           so long as immediately after giving effect to the incurrence of
any such Indebtedness, no Event of Default has occurred and is continuing,
Capitalized Lease Indebtedness and other Indebtedness (including Capitalized
Leases) financing the acquisition or replacement of equipment used at the
Hotel/Casino Facility; provided that such Indebtedness is incurred concurrently
with or within two hundred seventy (270) days after the applicable acquisition
or replacement; provided further that the aggregate principal amount of all
Indebtedness permitted under this clause (c) shall not exceed $2,500,000 at any
time outstanding;

 

(d)           Indebtedness representing deferred compensation to employees of
the Borrower and the Leasehold Holder incurred in the Ordinary Course of
Business of operating the Hotel/Casino Facility;

 

(e)           Indebtedness in respect of netting services, overdraft protections
and similar arrangements, in each case, in connection with deposit accounts;

 

(f)            Indebtedness consisting of (i) the financing of insurance
premiums incurred in the Ordinary Course of Business, or (ii) take-or-pay
obligations contained in supply arrangements incurred in the Ordinary Course of
Business of operating the Hotel/Casino Facility;

 

(g)           Indebtedness incurred by the Borrower or the Leasehold Holder in
respect of letters of credit, bank guarantees, bankers’ acceptances or similar
instruments issued or created in the Ordinary Course of Business of operating
the Hotel/Casino Facility in respect of workers compensation claims, health,
disability or other employee benefits or property, casualty or liability
insurance or self-insurance or other Indebtedness with respect to
reimbursement-type obligations regarding workers compensation claims; provided
that any reimbursement obligations in respect thereof are reimbursed within
thirty (30) days following the incurrence thereof; and

 

(h)           obligations in respect of performance, bid, appeal and surety
bonds and performance and completion guarantees and similar obligations provided
by the Borrower or Leasehold Holder or obligations in respect of letters of
credit, bank guarantees or similar instruments related thereto, in each case
incurred in the Ordinary Course of Business of operating the

 

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Hotel/Casino Facility.

 

“Permitted Encumbrances” shall mean collectively, (a) Liens pursuant to any Loan
Document (including, without limitation, Liens created thereunder securing the
Specified Interest Rate Contracts); (b) all Liens, encumbrances and other
matters disclosed in the Title Policies; (c) Liens, if any, for Impositions
imposed by any Governmental Authority not yet due or delinquent; (d) statutory
Liens of landlords, carriers, warehousemen, mechanics, materialmen, repairmen,
construction contractors or other like Liens arising in the Ordinary Course of
Business which secure amounts not overdue for a period of more than thirty (30)
days or if more than thirty (30) days overdue, are unfiled and no other action
has been taken to enforce such Lien or which are the subject of a Good Faith
Contest; (e) easements, rights-of-way, restrictions and other similar charges or
non-monetary encumbrances against real property which would not individually or
in the aggregate be reasonably likely to have a Property Material Adverse
Effect; (f) any judgment Lien provided that the judgment it secures shall have
been discharged of record or the execution thereof stayed pending appeal within
30 days after the entry thereof or within 30 days after the expiration of any
stay, as applicable; (g) any Approved Lease; (h) the Ground Lease; (i) pledges
or deposits in the Ordinary Course of Business in connection with workers’
compensation, unemployment insurance and other social security legislation;
(j) pledges and deposits in the Ordinary Course of Business of operating the
Hotel/Casino Facility securing liability for reimbursement or indemnification
obligations of (including obligations in respect of letters of credit or bank
guarantees for the benefit of) insurance carriers providing property, casualty
or liability insurance to the Borrower or Leasehold Holder; (k) deposits to
secure the performance of bids, trade contracts, governmental contracts and
leases (other than Indebtedness for borrowed money), statutory obligations,
surety, stay, customs and appeal bonds, performance bonds and other obligations
of a like nature (including those to secure health, safety and environmental
obligations) incurred in the Ordinary Course of Business of operating the
Hotel/Casino Facility; (l) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in connection
with the importation of goods in the Ordinary Course of Business of operating
the Hotel/Casino Facility; (m) Liens arising out of conditional sale, title
retention, consignment or similar arrangements for sale of goods entered into
by, or by HCF Manager in behalf of, the Borrower or the Leasehold Holder in the
Ordinary Course of Business of operating the Hotel/Casino Facility; (n) Liens
encumbering reasonable customary initial deposits and margin deposits and
similar Liens attaching to commodity trading accounts or other brokerage
accounts incurred in the Ordinary Course of Business of operating the
Hotel/Casino Facility and not for speculative purposes; (o) Liens that are
contractual rights of set-off: (i) relating to the establishment of depository
relations with banks not given in connection with the issuance of Indebtedness,
(ii) relating to pooled deposit or sweep accounts of the Borrower or Leasehold
Holder to permit satisfaction of overdraft or similar obligations incurred in
the Ordinary Course of Business of the Borrower and Leasehold Holder or
(iii) relating to purchase orders and other agreements entered into with
customers of the Borrower or Leasehold Holder in the Ordinary Course of Business
of operating the Hotel/Casino Facility; (p) Liens securing Indebtedness
permitted under clause (c) of the definition of “Permitted Debt” contained
herein; provided that (i) such Liens attach concurrently with or within two
hundred seventy (270) days after the acquisition, repair, replacement,
construction or improvement (as applicable) of the property subject to such
Liens, (ii) such Liens do not at any time encumber any property except for the
property financed by such Indebtedness and accessions thereto, (iii) with
respect to Capitalized Leases, such Liens do not at any time extend

 

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to or cover any assets (except for accessions to such assets) other than the
assets subject to such Capitalized Leases; provided that individual financings
of equipment provided by one lender may be cross collateralized to other
financings of equipment provided by such lender and (iv) the amount of
Indebtedness secured thereby does not exceed the cost of the acquisition,
repair, replacement, construction or improvement (as applicable) of such
property; and (q) such other Liens as Administrative Agent may approve in
writing in its sole discretion.

 

“Permitted Distributions” shall mean (i) all payments required to be made by any
Loan Party  or its Subsidiaries, if any, to Holdco (either for itself or for
further distribution to Propco) pursuant to and in accordance with the terms of
the Tax Sharing Agreement and/or the Expense Sharing Agreement, (ii) payments to
Holdco to pay franchise taxes, taxes and expenses required to maintain Holdco’s
limited liability company existence, (iii) distributions of cash made by either
Borrower or Leasehold Holder to Holdco provided that the funds of such
distribution are applied to make capital contributions by Holdco to either
Borrower or Leasehold Holder and (iv) distributions of cash made by either
Borrower or Leasehold Holder permitted pursuant to Section 5.2 of their
respective Operating Agreements.

 

“Person” shall mean an individual, partnership, corporation (including a
business trust), joint stock company, estate, trust, limited liability company,
unincorporated association, Joint Venture or other entity, or a Governmental
Authority.

 

“Personal Property” shall mean, collectively, all the “Personal Property” as
such term is defined and set forth in each of the Security Instruments and in
any of the other Collateral Documents, and shall include all the “Personal
Property” as defined in any of such Security Instruments, and shall also include
all personal property described in any of the other Collateral Documents under
which a Lien is granted or purported to be granted to the Administrative Agent
or any Lender.

 

“PIK Amounts” shall have the meaning ascribed to such term in
Section 2.6(3)(a) hereof.

 

“Plan” shall mean an employee benefit plan (as defined in Section 3(3) of ERISA)
which any Borrower Party sponsors or maintains or to which any Borrower Party
makes, is making, or is obligated to make contributions and includes any Pension
Plan, other than a Multiemployer Plan.

 

“Pledge Agreement” shall mean the Holdco Pledge Agreement.

 

“Pledgor” shall mean Holdco.

 

“PML” shall mean probable maximum loss.

 

“Potential Default” shall mean an event which but for the lapse of time or the
giving of notice, or both, would constitute an Event of Default.

 

“Preferential Payment” shall have the meaning given such term in
Section 2.16(4) of this Agreement.

 

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“Prime Rate” shall mean the fluctuating per annum rate announced from time to
time by Deutsche Bank or any successor Administrative Agent at its principal
office in New York, New York as its “prime rate.”  The Prime Rate is a rate set
by Deutsche Bank as one of its base rates and serves as the basis upon which
effective rates of interest are calculated for those loans making reference
thereto, and is evidenced by the recording thereof after its announcement in
such internal publication or publications as Deutsche Bank may designate.  The
Prime Rate is not tied to any external index and does not necessarily represent
the lowest or best rate of interest actually charged to any class or category of
customers.  Each change in the Prime Rate will be effective on the day the
change is announced within Deutsche Bank.

 

“Principal Office” shall mean, for Administrative Agent, the Contact Office, or
such other office as Administrative Agent may from time to time designate in
writing to Borrower and each  Lender.

 

“Pro Rata Share” shall mean for all purposes with respect to all payments,
computations and other matters relating to the Loans of any Lender, the
percentage obtained by dividing (a) the Loans of that Lender by (b) the
aggregate Loans of all Lenders.

 

“Proceeds” shall mean amounts, awards or payments payable to or for the benefit
of any Loan Party (including, without limitation, amounts payable under any
title insurance policies covering the ownership interest in the Mortgaged
Property) or the Administrative Agent in respect of all or any part of the
Mortgaged Property in connection with a Casualty or Condemnation thereof (after
the deduction therefrom and payment to the applicable Loan Party and the
Administrative Agent, respectively, of any and all reasonable expenses incurred
by such Loan Party and the Administrative Agent in the recovery thereof,
including all attorneys’ fees and disbursements, the fees of insurance experts
and adjusters and the costs incurred in any litigation or arbitration with
respect to such Casualty or Condemnation).

 

“PropCo” shall mean Station Casinos, LLC, a Nevada limited liability company.

 

“PropCo Administrative Agent” shall mean the “Administrative Agent” (as defined
in the PropCo Credit Agreement).

 

“PropCo Credit Agreement” shall mean that certain Credit Agreement dated as of
June 16, 2011 among Propco as borrower, Deutsche Bank AG Cayman Islands Branch,
as Administrative Agent (as defined therein) and each lender from time to time
party thereto, as the same may be Modified.

 

“PropCo Credit Facility” shall mean the credit facility evidenced by the PropCo
Loan Documents.

 

“Propco Default” shall have the meaning given such term in Section 2.3(b)(3) of
this Agreement.

 

“Propco Event of Default” shall have the meaning given such term in
Section 2.3(b)(3) of this Agreement.

 

“Propco Forbearance Agreement” shall have the meaning given such term in

 

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Section 2.3(b)(3) of this Agreement.

 

“Propco Forbearance Period” shall have the meaning given such term in Section
2.3(b)(3) of this Agreement.

 

“PropCo Loan Documents” shall mean, collectively, the PropCo Credit Agreement,
the “Loan Documents” (as defined in the PropCo Credit Agreement) and all other
documents executed by PropCo or its Affiliates in connection with the PropCo
Credit Agreement.

 

“Property” shall mean, for any Person, collectively and severally, any and all
real property and all personal property, equipment and fixtures owned or
occupied by the subject Person.  “Property” shall include all Capital Stock
owned by the subject Person in a Subsidiary Entity.

 

“Property Material Adverse Effect” shall mean any event or condition,
individually or in the aggregate, that has a material adverse effect on the use,
operation, or value of a Real Property or the ability to operate the Ground
Lease Parcel as a hotel and casino as currently operated on the Effective Date.

 

“Provisional Extension Termination Date” shall have the meaning given such term
in Section 2.3(b)(3) of this Agreement.

 

“Purpose” shall have the meaning given such term in the definition of “Single
Purpose Entity” in this Agreement.

 

“Rate Contract Collateral” shall have the meaning given such term in
Section 5.13(2) of this Agreement.

 

“Rating Agencies” shall mean each of S&P and Moody’s and any other
nationally-recognized statistical rating agency which has been approved by
Administrative Agent.

 

“RDC Parcel” shall have the meaning given such term in Section 5.10(5) of this
Agreement.

 

“Real Property” shall mean each of the Wild Wild West Assemblage and the Cactus
Assemblage, together with the improvements and fixtures thereon and
appurtenances thereto.

 

“Recourse Guarantor” shall mean PropCo.

 

“Recourse Guaranty” shall mean that certain Limited Support Agreement and
Recourse Guaranty executed by Recourse Guarantor as of the Effective Date, as
Modified from time to time.

 

“Reduced DBTCA Loan” shall have the meaning ascribed to such term in the
recitals to this Agreement.

 

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“Reduced Hedge Termination Payment” shall have the meaning ascribed to such term
in the recitals to this Agreement.

 

“Reduced JP Morgan Loan” shall have the meaning ascribed to such term in the
recitals to this Agreement.

 

“Register” shall have the meaning given such term in Section 10.8(2) of this
Agreement.

 

“Regulation D” shall mean Regulation D of the Board of Governors of the Federal
Reserve System from time to time in effect and shall include any successor or
other regulation of said Board of Governors relating to reserve requirements
applicable to member banks of the Federal Reserve System.

 

“Regulation T” shall mean Regulation T of the Board of Governors of the Federal
Reserve System (12 C.F.R. § 221), as the same may from time to time be Modified.

 

“Regulation U” shall mean Regulation U of the Board of Governors of the Federal
Reserve System (12 C.F.R. § 221), as the same may from time to time be Modified.

 

“Regulation X” shall mean Regulation X of the Board of Governors of the Federal
Reserve System (12 C.F.R. § 221), as the same may from time to time be Modified.

 

“Rents” shall mean all rents, rent equivalents, moneys payable as damages or in
lieu of rent or rent equivalents, royalties (including, without limitation, all
oil and gas or other mineral royalties and bonuses), income, receivables,
receipts, revenues, deposits (including, without limitation, security, utility
and other deposits), accounts, cash, issues, profits, charges for services
rendered, termination or surrender fees, penalties and other consideration of
whatever form or nature arising from the use or enjoyment of all or any portion
of the Mortgaged Property, or received by or paid to or for the account of or
benefit of any Loan Party from any and all sources arising from or attributable
to the Mortgaged Property, and including the rental or surrender of any office
space, retail space, parking space, halls, stores, and offices of every kind,
the rental or licensing of signs, sign space or advertising space and all
membership fees and dues, receipts, accounts receivable, cancellation fees,
credit card receipts and other receivables relating to or arising from rentals,
rent equivalent income, vending machines, parking facilities, telecommunication
and television systems, the provision or sale of other goods and services, and
Proceeds, if any, from business interruption or other loss of income insurance.

 

“Reportable Event” shall mean any of the events set forth in Section 4043(b) of
ERISA or the regulations thereunder, other than any such event for which the
thirty (30)-day notice requirement under ERISA has been waived in regulations
issued by the PBGC.

 

“Required Interest Rate Contracts” shall mean, collectively, those Interest Rate
Contracts required during the First Extension Term and the Second Extension Term
pursuant to Section 2.3(b).

 

“Required Lenders” shall mean at any date, (a) Lenders holding more than 50% of
the Loans, and (b) in the event that Deutsche Bank and its Affiliates hold, in
the aggregate, more

 

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than 50% of the Loans, Required Lenders must include at least one Lender other
than Deutsche Bank and its Affiliates.

 

“Requirements of Law” shall mean, as to any Person, the Organizational Documents
of such Person, and any law (including, without limitation, any Gaming Law),
treaty, order, directive, rule or regulation, or a final and binding
determination of an arbitrator or a determination of a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject, including, without limitation, Hazardous Materials Laws and all
covenants, restrictions and conditions now or hereafter of record which may be
applicable to any Loan Party or to the Mortgaged Property and the Improvements
thereon, or to the use, manner of use, occupancy, possession, operation,
maintenance, alteration, repair or reconstruction of the Mortgaged Property and
the Improvements thereon including, without limitation, building and zoning
codes and ordinances and laws relating to handicap accessibility.

 

“Reserve Adjusted LIBO Rate” shall mean the rate per annum (rounded upward, if
necessary, to the next higher 1/100 of one percent) calculated as of the first
day of such Interest Period in accordance with the following formula:

 

 

Reserve Adjusted LIBO Rate =  

LR

 

 

 

1-LRP

 

 

where

LR   =  LIBO Rate

LRP =  LIBO Reserve Percentage

 

“Responsible Officer” means the chief executive officer, president, vice
president, principal accounting officer, treasurer or assistant treasurer or
other similar officer of a Borrower Party and, as to any document delivered on
the Closing Date, any secretary or assistant secretary of a Borrower Party.  Any
document delivered hereunder that is signed by a Responsible Officer of a
Borrower Party shall be conclusively presumed to have been authorized by all
necessary corporate, limited liability company, partnership and/or other action
on the part of such Borrower Party and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Borrower Party.

 

“Restoration” shall have the meaning given such term in Section 5.5(3) of this
Agreement.

 

“Restricted” shall mean, when referring to cash or Cash Equivalents of the Loan
Parties, that such cash or Cash Equivalents (i) appears (or would be required to
appear) as “restricted” on a consolidated balance sheet of the Borrower or of
Leasehold Holder (unless such appearance is related to the Loan Documents or
Liens created thereunder), (ii) are subject to any Lien in favor of any Person
other than the Administrative Agent for the benefit of the Secured Parties or
(iii) constitute Cage Cash.

 

“SCINC” shall have the meaning given to such term in the Recitals.

 

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

 

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“Second Extended Maturity Date” means June 17, 2018.

 

“Second Extension Term” means the time period commencing on the day after the
First Extended Maturity Date and ending on the Second Extended Maturity Date.

 

“Secured Parties” shall mean, collectively, the Agents, and the Lenders, or, in
the case of any Specified Interest Rate Contract, any Counterparty thereto.

 

“Securities” shall mean any stock, shares, partnership interests, membership
interests, voting trust certificates, certificates of interest or participation
in any profit sharing agreement or arrangement, bonds, debentures, options,
warrants, notes, or other evidences of indebtedness, secured or unsecured,
convertible, subordinated or otherwise, or in general any instruments commonly
known as “securities” or any certificates of interest, shares or participations
in temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.

 

“Security Agreement” means that certain Security Agreement dated as of the date
hereof executed by Borrower and Leasehold Holder.

 

“Security Instruments” shall collectively mean the deeds of trust entered into
by Borrower and the Leasehold Holder in favor of Administrative Agent with
respect to the Mortgaged Property, as the same may be hereafter Modified from
time to time.

 

“Single Purpose Entity” shall mean a Person, other than an individual, which
(a) does not own and shall not own any assets other than its respective
ownership and/or leasehold interest in the Mortgaged Property in accordance with
the terms of this Agreement and personal property and other Collateral, rights
and interests incidental to the ownership and operation of its respective
ownership and/or leasehold interest in the Mortgaged Property and, with respect
to Holdco, holding an ownership interest in the Capital Stock of Borrower and
Leasehold Holder, (b) does not and shall not engage in any business unrelated to
the ownership, operation, financing, selling and leasing of its respective
assets described in clause (a) above (in respect of such Person, its “Purpose”),
(c) has not and will not have any assets other than those related to its
Purpose, and has not or will not have any Indebtedness, other than as expressly
permitted by the Loan Documents, (d) maintains its own separate books and
records and its own accounts, in each case which are separate and apart from the
books and records and accounts of any other Person, (e) holds itself out as
being a Person, separate and apart from any other Person, (f) does not and will
not commingle its funds or assets with those of any other Person other than
another Loan Party except in connection with the Tax Sharing Agreement and
Expense Sharing Agreement as permitted by this Agreement, (g) conducts its own
business in its own name, (h) maintains separate financial statements (except
where consolidated financial statements are permitted or required by applicable
law or GAAP, provided that such consolidated statements shall reflect that such
Person and any other Person covered by such financial statements are separate
legal entities) and files its own tax returns (except as otherwise required or
permitted by applicable law), (i) other than as provided in the Management
Agreements, Recourse Guaranty, the Tax Sharing Agreement and the Expense Sharing
Agreement, pays its own debts and liabilities when they become due out of its
own funds, (j) observes all partnership, corporate, limited liability company
formalities and does all things necessary to preserve its existence as an
entity,

 

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(k) except for the Management Agreements, Recourse Guaranty, the Tax Sharing
Agreement and the Expense Sharing Agreement and except as otherwise expressly
permitted by the Loan Documents (or the respective Operating Agreements of the
Loan Parties), maintains an arm’s-length relationship with its Affiliates and
does not enter into any Contractual Obligations with any Affiliates except upon
terms and conditions that are intrinsically fair and substantially similar to
those that would be available on an arms-length basis (taking into account the
relative standards of quality and reputation of the party rendering the service)
with third parties other than an Affiliate, (l) except as provided in the
Recourse Guaranty and the Expense Sharing Agreement, pays the salaries of its
own employees, if any, and maintains a sufficient number of employees in light
of its contemplated business operations, (m) except for the guaranty and
indemnification obligations set forth in the Loan Documents and the Permitted
Encumbrances, does not guarantee or otherwise obligate itself with respect to
the debts of any other Person, or hold out its credit as being available to
satisfy the obligations of any other Person, except as expressly contemplated by
the Loan Documents, (n) does not acquire obligations or securities of its
partners, members or shareholders, (o) except as provided in the Expense Sharing
Agreement, allocates fairly and reasonably with applicable Affiliates shared
expenses, including any overhead for shared office space, (p) except for the
Pledge Agreement and except for in connection with Permitted Encumbrances, does
not and will not pledge its assets for the benefit of any other Person or make
any loans or advances to any other Person, (q) intends to maintain adequate
capital in light of its contemplated business operations, and (r) has and will
have Organizational Documents which comply with the requirements set forth in
this definition.

 

“Specified Interest Rate Contract” shall mean any Required Interest Rate
Contract entered into by (a) Borrower and (b) (i) , DBTCA, Deutsche Bank,
Deutsche Bank Securities Inc. or an affiliate of DBTCA, Deutsche Bank or
Deutsche Bank Securities Inc., (ii) JPMorgan, J. P. Morgan Securities Inc. or an
affiliate of JPMorgan or J. P. Morgan Securities Inc., (iii) any Lender or an
affiliate of a Lender, or (iv) any Person that was a Lender or an affiliate
thereof when such Required Interest Rate Contract was entered into, as
Counterparty.

 

“Subsidiary” shall mean, with respect to any Person:  (a) any corporation more
than fifty percent (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 Subsidiaries or by such Person and one
or more of its Subsidiaries, or (b) any partnership, limited liability company,
association, joint venture or similar business organization more than fifty
percent (50%) of the ownership interests having ordinary voting power of which
shall at the time be so owned or Controlled.

 

“Subsidiary Entities” shall mean, with respect to any Person, a Subsidiary or
Joint Venture of such Person.

 

“Survey” shall mean an ALTA survey of the Mortgaged Property prepared by a
surveyor licensed in the state the Mortgaged Property is located and reasonably
acceptable to the Administrative Agent and the company or companies issuing the
Title Policies, and containing a certification of such surveyor reasonably
acceptable to the Administrative Agent.

 

“Syndication Agent” shall have the meaning given such term in the preamble to
this Agreement and shall include any successor to JPMorgan as the initial
“Syndication Agent”

 

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hereunder.

 

“Tax Affiliate” shall mean, with respect to any Person, (a) any Subsidiary of
such Person, and (b) any Affiliate of such Person with which such Person files
or is eligible to file Consolidated, combined or unitary tax returns.

 

“Tax Returns” shall have the meaning given such term in Section 4.7(1) of this
Agreement.

 

“Tax Sharing Agreement” shall mean that certain Tax Sharing Agreement, dated as
of the date hereof made by and among Pledgor, Borrower and Leasehold Holder.

 

“Taxes” shall mean any and all federal, state, local or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental, customs duties, capital stock,
franchise, business license fees, profits, withholding, social security,
unemployment, disability, Real Property, Personal Property, sales, use,
transfer, registration, room or transient occupancy, value added, alternative or
add-on minimum, estimated, or other tax of any kind whatsoever, including any
interest, penalty, or addition thereto, whether disputed or not.

 

“Tenant” shall mean any Person leasing, subleasing or otherwise occupying any
portion of the Mortgaged Property or contractually permitted to use any portion
of the facilities at the Mortgaged Property, provided, that the term “Tenant”
shall not include the Leasehold Holder as tenant under the Ground Lease (but
shall include any Tenant under a sublease or sub-sublease thereunder).

 

“Terminated Swap Agreement” shall mean, collectively, (a) that certain ISDA
Master Agreement/Confirmation in the notional amount of Two Hundred Million
Dollars ($200,000,000.00) dated February 12, 2008, between Deutsche Bank AG and
Borrower, and (b) that certain ISDA Master Agreement/Confirmation in the
notional amount of Fifty Million Dollars ($50,000,000.00) dated June 30, 2008,
between Deutsche Bank AG and Borrower, each as Modified from time to time.

 

“Title Company” shall mean Commonwealth Land Title Insurance Company and its
affiliates.

 

“Title Policies” shall mean the ALTA mortgagee title insurance policies, each in
a form reasonably acceptable to the Administrative Agent issued by the Title
Company with respect to the Mortgaged Property and insuring the lien of the
Security Instruments.

 

“Total DB Loan Amount” shall have the meaning given such term in
Section 2.1(a)(i) of this Agreement.

 

“Transactional Affiliate” shall have the meaning given such term in Section 6.6
of this Agreement.

 

“Transfer” shall mean to, directly or indirectly, sell, assign, convey,
mortgage, transfer, pledge, hypothecate, encumber, grant a security interest in,
exchange or otherwise

 

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dispose of any beneficial interest or grant any option or warrant with respect
to, or where used as a noun, a direct or indirect sale, assignment, conveyance,
transfer, pledge or other disposition of any beneficial interest by any means
whatsoever whether voluntary, involuntary, by operation of law or otherwise.

 

“UCC” shall mean the Uniform Commercial Code in effect in the State of New York.

 

“Unfunded Pension Liability” shall mean the amount, if any, by which the value
of the accumulated plan benefits under a Pension Plan, determined on a plan
termination basis in accordance with actuarial assumptions at such time
consistent with those prescribed by the PBGC for purposes of Section 4044 of
ERISA, exceeds the fair market value of all plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions).

 

“Unpaid Disposition Amounts” shall have the meaning given such term in
Section 6.4(3)(ii) of this Agreement.

 

“Unrestricted Cash” shall mean, when referring to cash or Cash Equivalents of
the Loan Parties, that such cash or Cash Equivalents are not Restricted.  For
the avoidance of doubt, Cage Cash shall not be included in any calculation of
“Unrestricted Cash”.

 

“USA Patriot Act” shall have the meaning given such term in Section 4.26(1) of
this Agreement.

 

“Warrant Agreements” shall mean, collectively, the Borrower Warrant Agreement
and the Leasehold Holder Warrant Agreement.

 

“Warrants” shall mean, collectively, the Borrower Warrants and the Leasehold
Holder Warrants.

 

“Wild Wild West Assemblage” shall collectively mean the Wild Wild West Fee
Assemblage, the Ground Lease Parcel, and all Option Parcels acquired by Borrower
or any Affiliate of Borrower in accordance with this Agreement.

 

“Wild Wild West Fee Assemblage” shall mean that certain land assemblage located
in the Las Vegas, Nevada metropolitan area located near Tropicana Avenue
adjacent to Interstate 15, as more particularly described on Schedule 1.1D.

 

1.2           Other Interpretive Provisions.

 

In this Agreement and in the other Loan Documents, except as otherwise expressly
provided:

 

(i)            words expressing the singular include the plural and vice versa;

 

(ii)           words denoting gender include all genders;

 

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(iii)          words denoting the whole of a matter or thing include a part of
the matter or thing;

 

(iv)          the term “Mortgaged Property” shall be construed to be followed by
the phrase “or any part or portion thereof or interest therein”;

 

(v)           words and expressions importing natural Persons include Persons
that are not natural Persons and vice versa;

 

(vi)          the words “hereof,” “herein” and “hereunder” and words of similar
import shall refer to this Agreement or the applicable Loan Document, as the
case may be, as a whole and not to any particular provision of this Agreement or
such Loan Document;

 

(vii)         the words “include,” “includes,” “including” and similar terms
shall be construed as if followed by the words “without being limited to” or
“without limitation”;

 

(viii)        the words “shall” and “will” shall be construed as obligatory
terms;

 

(ix)           the word “may” shall be construed as a discretionary term (and as
if followed by “but shall not be obligated to”);

 

(x)            all references to sections, schedules and exhibits are to
sections, schedules and exhibits in or to this Agreement or the applicable Loan
Document, as the case may be;

 

(xi)           article, section, subsection and paragraph headings and captions
and any tables of contents are included solely for convenience of reference only
and shall not constitute a part of this Agreement or the applicable Loan
Document, as the case may be, for any other purpose;

 

(xii)          exhibits and schedules annexed to this Agreement or the
applicable Loan Document, as the case may be, are hereby incorporated into this
Agreement or such Loan Document, as the case may be, as a part of this Agreement
or such Loan Document, as the case may be, with the same effect as if set forth
in the body of this Agreement or such Loan Document, as the case may be;

 

(xiii)         the recitals to this Agreement are incorporated into this
Agreement and form a part of this Agreement and the Borrower represents and
warrants that, as of the Effective Date, the Recitals are true and correct;

 

(xiv)        a reference to a document or agreement, including this Agreement or
any Loan Document, includes a reference to such document or agreement as
novated, amended, modified, supplemented or replaced from time to time;

 

(xv)         derivatives of a word defined herein or therein, as the case may
be, have a corresponding meaning;

 

(xvi)        a reference to writing includes printing, engraving, typewriting,

 

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lithography, photography and any other mode of reproducing or representing
words, figures or symbols in a permanent and visible form;

 

(xvii)       a reference to any legislation or to any provision of any
legislation shall include any amendment to, and any modification, replacement or
re-enactment thereof, any legislative provision substituted therefor, and all
regulations, rules, rulings and statutory instruments issued thereunder or
pursuant thereto;

 

(xviii)      a reference to a party to this Agreement, any Loan Document or
another agreement or document includes such party’s executors, administrators,
successors and permitted assigns (provided that the foregoing shall not be
deemed to permit any Transfer of any ownership interest that is otherwise
prohibited hereunder);

 

(xix)         if a provision binds two or more parties that provision binds
those parties jointly and severally;

 

(xx)          if a party comprises two or more Persons, the provisions of this
Agreement or the applicable Loan Document, as the case may be, binding that
party bind those Persons jointly and severally;

 

(xxi)         if a payment obligation comes due on a day which is not a Business
Day, payment shall be due on the immediately following Business Day;

 

(xxii)        attorneys,’ consultants’ and experts’ fees shall include customary
disbursements and related charges of the professional involved;

 

(xxiii)       “Approval,” “Approved,” “approval” or “approved” or words of
similar import such as “consent” shall mean, as the context so determines, an
approval or consent (as the case may be) in writing given to the party seeking
approval or consent (as the case may be) after full disclosure to the party
giving approval or consent (as the case may be) of all material facts necessary
in order to determine whether the approval or consent (as the case may be)
should be granted.  Approvals or consents by the Administrative Agent or any
Lender may be granted or withheld in the absolute and sole discretion of the
Administrative Agent or such Lender unless this Agreement or any Loan Document
expressly provides otherwise.  Similarly, where a matter is stated to be in the
Administrative Agent’s or any Lender’s opinion, in the Administrative Agent’s or
any Lender’s judgment, acceptable to the Administrative Agent or any Lender,
satisfactory to the Administrative Agent or any Lender, required by the
Administrative Agent or any Lender, determined by the Administrative Agent or
any Lender or subject to the Administrative Agent’s or any Lender’s consent or
like phrases, unless this Agreement or any Loan Document expressly provides
otherwise, such terms shall be construed to mean in the Administrative Agent’s
or such Lender’s sole opinion, in the Administrative Agent’s or such Lender’s
sole judgment, acceptable to the Administrative Agent or such Lender in its sole
discretion, satisfactory to the Administrative Agent or such Lender in its sole
discretion, required by the Administrative Agent or such Lender in its sole
discretion, determined by the Administrative Agent or such Lender in its sole
discretion, and subject to the Administrative Agent’s or such Lender’s consent
in its sole discretion;

 

(xxiv)       whenever a consent, approval, request or like act may not be

 

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unreasonably withheld, it shall also not be unreasonably delayed or conditioned;
and

 

(xxv)                       the principle of construing this Agreement or any
other Loan Document against the party that drafted the same is expressly
excluded.

 

1.3                                 Accounting Terms; Calculations.

 

(a)                                  All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP, applied in a manner consistent with that used in
preparing audited financial statements, except as otherwise specifically
prescribed herein.

 

(b)                                 The Administrative Agent shall have the
right to request, review and audit all such information it determines necessary
to confirm the financial, tax and other business assumptions or determinations
made in the calculation of any financial calculation or financial covenant
provided for in this Agreement; provided, that in the event of any dispute
between the Borrower and the Administrative Agent regarding such calculations or
determinations, such calculations or determinations shall be made by the
Borrower’s independent registered public accounting firm or, if such accounting
firm does not or cannot make such determination, another independent registered
public accounting firm that as of the date of this Agreement is one of the “big
four” accounting firms.

 

(c)                                  Notwithstanding any other provision
contained herein, all terms of an accounting or financial nature used herein
shall be construed, and all computations of amounts and ratios referred to
herein shall be made, without giving effect to any election under Statement of
Financial Accounting Standards 159 (or any other Financial Accounting Standard
having a similar result or effect) to value any Indebtedness or other
liabilities of the Borrower or Leasehold Holder at “fair value”, as defined
therein.

 

ARTICLE II
CREDIT FACILITY

 

2.1                                 Loans; Advances to Borrower; Amendment and
Restatement.

 

(a)                                              Subject to the terms and
conditions set forth herein and in exchange for the Warrants, each Lender agrees
that, on the Effective Date, (i) the Reduced Hedge Termination Payment is
combined with and added to the outstanding principal balance of the Reduced
DBTCA Loan (such aggregate sum, the “Total DB Loan Amount”) and the Total DB
Loan Amount is  restructured and converted to, and shall constitute, a Loan
hereunder, evidenced by the Deutsche Bank Note, and (ii) the outstanding
principal balance of the Reduced JPM Loan Amount is converted to, and shall
constitute, a Loan hereunder, evidenced by the JPMorgan Note.  Each Loan shall
be subject to a new Interest Period beginning on the Effective Date. The amount
of each Lender’s Loans as of the Effective Date is set forth on Schedule 2.1
attached hereto.  The credit facility evidenced by this Agreement is referred to
herein as the “Facility”.

 

(b)                                             Borrower acknowledges and agrees
that the full proceeds of the Loans have been disbursed by Lenders to Borrower
and that the Lenders have no further obligation to make

 

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Advances.  Any amount of the Loans repaid in accordance with the terms of this
Agreement may not be re-borrowed, and all other amounts owed hereunder with
respect to the Loans shall be paid in full no later than the Maturity Date.

 

(c)                                              As of the Effective Date, the
Loans are LIBO Rate Loans covering the Interest Period that begins on the
Effective Date and shall, with respect to subsequent Interest Periods, continue
as LIBO Rate Loans without conversion. Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing on the day
occurring three (3) Eurodollar Business Days prior to the end of an Interest
Period, then, so long as an Event of Default is continuing, unless repaid, the
Administrative Agent may, in its sole discretion, elect to convert the Loans to
Base Rate Loans at the end of the Interest Period applicable thereto.

 

2.2                                 Amendment and Restatement.  This Agreement
supersedes, amends and restates the Original Credit Agreement in its entirety
and is not intended to constitute (i) a novation, refinancing, discharge,
extinguishment or refunding of any of the Obligations, or (ii) a release,
waiver, or discharge of any of the rights or remedies set forth in the Loan
Documents or, prior to the Effective Date, the Original Credit Agreement. 
Borrower’s obligation to pay the principal of and interest on the Loans
(including late charges, Default Rate interest and any other amounts or payments
due hereunder or under any of the other Loan Documents) shall be evidenced by
this Agreement and by the Note.  The Note shall be payable as to principal,
interest, late charges, Default Rate interest and as to any other amounts or
payments due hereunder or under any of the other Loan Documents, as specified in
this Agreement, with a final maturity on the Maturity Date.

 

2.3                                 Maturity

 

(a)                                  Unless previously accelerated, all
Obligations with respect to the Loans shall be paid in full no later than
1:00 p.m., New York time on the Maturity Date.

 

(b)                                 Borrower shall have two (2) options to
extend the term of the Loans (each, an “Option to Extend”), from the Original
Maturity Date to the First Extended Maturity Date, and from the First Extended
Maturity Date to the Second Extended Maturity Date, in each case upon
satisfaction of all of the following conditions precedent:

 

(1)                                  Borrower shall provide Administrative Agent
with written notice of Borrower’s request to exercise the applicable Option to
Extend, at least thirty (30), but not more than ninety (90), days prior to the
Original Maturity Date or First Extended Maturity Date, as applicable (the
“Extension Request”);

 

(2)                                  As of the date of Borrower’s delivery of
the Extension Request, and as of the Original Maturity Date or First Extended
Maturity Date, as applicable, no Event of Default or Potential Default shall
have occurred and be continuing, and Borrower shall so certify in writing;

 

(3)                                  As of the date of Borrower’s delivery of
the Extension Request, and as of the Original Maturity Date or First Extended
Maturity Date, as applicable, no Default (as defined in the PropCo Credit
Agreement (a “Propco Default”)) or Event of Default(as defined

 

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in the PropCo Credit Agreement (a “Propco Event of Default”)) shall have
occurred and be continuing under the PropCo Loan Documents, and PropCo shall so
certify in writing; provided that if as of the date Borrower delivers the
Extension Request or as of the Original Maturity Date or First Maturity Date, as
applicable, (x) a PropCo Default exists, but such PropCo Default has not become
or been declared to be a PropCo Event of Default, or (y) a PropCo Event of
Default exists, but the PropCo Administrative Agent has entered into a
forbearance agreement or similar agreement (a “PropCo Forbearance Agreement”)
agreeing to forbear from the exercise of its rights and remedies with respect
thereto for a certain period of time (the “PropCo Forbearance Period”), and
provided that (in the case of (x) or (y)) Borrower has satisfied each of the
other conditions precedent contained in this Section 2.3(b), then the term of
the Loans shall be extended on a provisional basis only until the earlier to
occur of (i) the date such PropCo Default or PropCo Event of Default is cured or
waived in writing by the PropCo Administrative Agent and no other PropCo Default
or PropCo Event of Default exists under the PropCo Credit Agreement, in which
case the term of the Loans shall be extended as provided in this
Section 2.3(b) (provided the other conditions precedent listed in this
Section 2.3(b) have been satisfied) to the First Extended Maturity Date or
Second Extended Maturity Date, as applicable, or (ii) the date (the “Provisional
Extension Termination Date”) upon which either (A) the PropCo Default becomes or
is declared by the PropCo Administrative Agent to be a PropCo Event of Default
(unless a PropCo Forbearance Agreement was entered into prior to the date such
PropCo Default became or was declared to be a PropCo Event of Default and the
PropCo Forbearance Period remains in full force and effect notwithstanding such
PropCo Event of Default), or (B) the PropCo Forbearance Agreement or the PropCo
Forbearance Period terminates or expires and a PropCo Event of Default continues
to exist following the termination or expiration of the PropCo Forbearance
Agreement or PropCo Forbearance Period, or (C) a subsequent PropCo Event of
Default occurs after the Original Maturity Date or First Extended Maturity Date,
as applicable, then in the case of (A), (B) or (C), Borrower shall be deemed to
have failed to satisfy Section 2.3(b)(3) of the conditions precedent to extend
the term of the Loans and all Obligations with respect to the Loans shall be due
and payable as of the Provisional Extension Termination Date (and the
Provisional Extension Termination Date shall be deemed to be the “Maturity Date”
for purposes of this Agreement and the other Loan Documents), and Administrative
Agent shall be entitled to exercise all of its rights and remedies under the
Loan Documents and applicable law in the event all Obligations with respect to
the Loans are not repaid in full on such Provisional Extension Termination Date,
and no payments received or accepted by Administrative Agent or the Lenders
prior to the Provisional Termination Date shall constitute or be deemed to
extend the term of the Loans or waive or modify any of the provisions of this
Section 2.3(b).

 

(4)                                  With respect to the first Option to Extend,
on a date no later than the first day of the First Extension Term (or, if the
first day of the First Extension Term is a weekend or federal holiday, on the
first business day of the First Extension Term), Borrower shall have entered
into Interest Rate Contracts with an Acceptable Counterparty which: (a) are in
an aggregate notional amount equal to not less than the then-outstanding
aggregate principal amount of all the Loans; (b) fixes or caps LIBOR at no more
than five percent (5.00%); (c) covers the period from the first day of the First
Extension Term through the First Extended Maturity Date, (d) otherwise comply
with the requirements set forth in Section 5.12; and (e) are collaterally
assigned to the Administrative Agent pursuant to the Assignment(s) of Interest
Rate Contract.

 

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(5)                                  With respect to the second Option to
Extend, on a date no later than the first day of the Second Extension Term,
Borrower shall have entered into Interest Rate Contracts with an Acceptable
Counterparty which: (a) are in an aggregate notional amount equal to not less
than the then-outstanding aggregate principal amount of all the Loans; (b) fixes
or caps LIBOR at no more than five percent (5.00%); (c) covers the period from
the first day of the Second Extension Term through the Second Extended Maturity
Date, (d) otherwise comply with the requirements set forth in Section 5.12; and
(e) are collaterally assigned to the Administrative Agent pursuant to the
Assignment(s) of Interest Rate Contract.

 

(6)                                  With respect to the first Option to Extend,
prior to or concurrently with the delivery of Borrower’s Extension Request (and
Borrower’s satisfaction of all conditions precedent to Borrower’s extension of
the term of the Loans to the First Extended Maturity Date set forth in this
Section 2.3(b)), PropCo shall have properly exercised its first option to extend
the Maturity Date (as defined in the PropCo Credit Agreement) for an additional
twelve (12) months in accordance with the terms of the PropCo Credit Agreement
or the PropCo Credit Facility shall have been fully refinanced for a term
(excluding any extension options) which does not mature prior to the First
Extended Maturity Date;

 

(7)                                  With respect to the second Option to
Extend, prior to or concurrently with the delivery of Borrower’s Extension
Request (and Borrower’s satisfaction of all conditions precedent to Borrower’s
extension of the term of the Loans to the Second Extended Maturity Date set
forth in this Section 2.3(b)), PropCo shall have properly exercised its second
option to extend the Maturity Date (as defined in the PropCo Credit Agreement)
for an additional twelve (12) months in accordance with the terms of the PropCo
Credit Agreement or the PropCo Credit Facility shall have been fully refinanced
for a term (excluding any extension options) which does not mature prior to the
Second Extended Maturity Date;

 

(8)                                  With respect to the second Option to
Extend, Borrower has previously properly exercised its first Option to Extend
the term of the Loans to the First Extended Maturity Date;

 

(9)                                  Borrower shall execute or cause the
execution of all documents reasonably required by Administrative Agent to
evidence the Option to Extend;

 

(10)                            Borrower shall pay the Extension Fee to
Administrative Agent, on or before 1:00 PM (New York time) on the first day of
the applicable extension term (or, if the first day of the First Extension Term
is a weekend or federal holiday, on the first business day of the First
Extension Term); and

 

(11)                            All costs and expenses incurred by
Administrative Agent (including, without limitation, reasonable attorneys’ fees
and expenses incurred by Administrative Agent in connection with the exercise of
such Option to Extend) shall be payable by Borrower on demand therefor.

 

2.4                                 Manner of Payment of Loans; Evidence of
Debt.

 

(1)                                  Repayment.  Subject to any earlier
acceleration of the Loans following an Event of Default, the Borrower hereby
unconditionally promises to pay to the

 

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Administrative Agent for the account of the Lenders the outstanding principal
amount of the Loans on the Maturity Date.

 

(2)                                  Manner of Payment.

 

(i)                         The Borrower shall notify the Administrative Agent
in writing (which notice may be by facsimile or electronic mail) of any
repayment or prepayment hereunder not later than 1:00 p.m. (New York time)
three  (3) Business Days before the date of repayment or prepayment.  Each such
notice shall be irrevocable and shall specify the repayment or prepayment date
and the principal amount of the Loans or portion thereof to be repaid or
prepaid.  Promptly following receipt of any such notice relating to the Loans,
the Administrative Agent shall advise the Lenders of the contents thereof.  Each
repayment or prepayment of the Loans shall be applied ratably to the Loans. 
Repayments and prepayments shall be accompanied by (y) accrued interest to the
extent required by Section 2.6 and (z) any payments due pursuant to Section 2.5.

 

(ii)                      The Borrower shall make each payment required to be
made by it hereunder (whether of principal, interest or fees) or under any other
Loan Document (except to the extent otherwise provided therein) prior to
1:00 p.m. (New York time) (unless otherwise specified in this Agreement), on the
date when due, in immediately available funds, without set-off or counterclaim. 
Any amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon.  All such payments
shall be wired to the Administrative Agent at the Contact Office,
ABA 021-001-033 for the Administrative Agent’s Account No. 99401268, Ref: CV
PropCo, LLC, except as otherwise expressly provided in the relevant Loan
Document.  The Administrative Agent shall distribute any such payments received
by it for the account of any other Person to the appropriate recipient promptly
following receipt thereof.  If any payment hereunder shall be due on a day that
is not a Business Day, the date for payment shall be extended to the next
succeeding Business Day and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension.  All
payments hereunder or under any other Loan Document (except to the extent
otherwise provided therein) shall be made in Dollars.

 

(3)                                  Maintenance of Loan Accounts by Lenders. 
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, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder.

 

(4)                                  Maintenance of Loan Accounts by the
Administrative Agent.  The Administrative Agent shall maintain accounts in which
it shall record (i) the amount of each Loan made hereunder and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Administrative Agent hereunder
for the account of the Lenders and each Lender’s share thereof.

 

(5)                                  Effect of Entries.  The entries made in the
accounts maintained

 

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pursuant to Sections 2.4(3) and (4) above shall be prima facie evidence of the
existence and amounts of the obligations recorded therein.  Any failure to
record the amount of a Loan, the Interest Period applicable thereto, the
interest rate applicable thereto or any other information regarding the
Obligations, or any error in doing so, shall not limit or otherwise affect the
obligation of the Borrower with respect to any of the Obligations.

 

(6)                                  Promissory Notes.  Upon the request of a
Lender, the Borrower shall promptly execute and deliver to such Lender a Note
(or replacement thereof) evidencing such Lender’s Loan.

 

2.5                                 Repayment and Prepayment of Loans; Mandatory
Prepayments.

 

(1)                Mandatory Prepayments.

 

(i)                                          If at any time the aggregate
Unrestricted Cash of the Loan Parties exceeds $1,000,000.00 for any period of
five consecutive Business Days, the Borrower shall immediately remit to the
Administrative Agent on the last Business Day of such period an amount equal to
such excess to be applied to the prepayment of the Loans under this Agreement.

 

(ii)                                       Subject to the payment of any
Deferred Management Fees permitted pursuant to the terms of Section 5.19(15) of
this Agreement, no later than the earlier of (x) forty-five (45) days after the
end of each fiscal quarter of the Borrower commencing with the fiscal quarter
ending September 30, 2011 and (y) the date on which the financial statements
with respect to such fiscal quarter have been delivered pursuant to
Section 5.1(1) and the related Compliance Certificate has been delivered
pursuant to Section 5.1(4), the Borrower shall remit to the Administrative Agent
an amount equal to the Excess Cash Flow (if positive) for such fiscal quarter to
be applied to the prepayment of the Loans under this Agreement; provided that
the amount of such prepayment with respect to any fiscal quarter shall be
reduced to the extent necessary such that, after giving effect thereto, the
aggregate amount of Unrestricted Cash maintained by the Loan Parties as of the
date of such prepayment shall not be less than $1,000,000.00.

 

(iii)                                    No later than five (5) Business Days
after payment of Proceeds of a Casualty or Condemnation of a Mortgaged Property
to Borrower or Leasehold Holder (or any Affiliate or agent of Borrower or
Leasehold Holder), the Borrower shall remit such Proceeds to the Administrative
Agent for application against the outstanding principal balance of the Loans the
Proceeds of a Casualty or Condemnation of a Mortgaged Property to the extent
required to be applied to the prepayment of the Loans under this Agreement.

 

(2)                                  Optional Prepayments.  Upon not less than
three (3) Business Days’ prior written notice to the Administrative Agent (which
shall promptly provide telephonic notice of the receipt thereof to each of the
Lenders), the Borrower may voluntarily prepay principal amounts outstanding
under the Loans in whole or in part (without any release of Collateral);
provided, however, that voluntary prepayments shall be in the minimum amount of
$250,000 and integral multiples of $50,000 in excess thereof.

 

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(3)                                  Accrued Interest.  The Borrower shall pay
in connection with any prepayment hereunder, whether voluntary or mandatory,
concurrently with payment of any principal amounts, all interest accrued but
unpaid on that portion of the Loans to which such prepayment is applied through
the end of the Interest Period during which such prepayment occurs.

 

(4)                                  Priority of Payments.

 

(i)                                     Prior to the occurrence of an Event of
Default, any voluntary or mandatory prepayment of any Loan pursuant to this
Section 2.5 shall, except as otherwise specified in this Section 2.5 and
Section 2.6 below, be applied to prepay the Loans on a pro rata basis (in
accordance with each Lender’s respective Pro Rata Share of the Loans) to the
full extent thereof;

 

(ii)                                  Following the occurrence and continuance
of an Event of Default, all amounts received by the Administrative Agent on
account of the Obligations, shall be promptly disbursed by the Administrative
Agent as follows:

 

(A)                              First, to the payment of expenses incurred by
the Administrative Agent in the performance of its duties and the enforcement of
the rights of the Secured Parties under the Loan Documents, including, without
limitation, all costs and expenses of collection, reasonable attorneys’ fees
(including all allocated costs of internal counsel), court costs and other
amounts payable to Administrative Agent as provided in Section 10.14 below;

 

(B)                                Then, to the Lenders, pro rata in accordance
with their respective Pro Rata Shares, until interest accrued on the Loans has
been paid in full;

 

(C)                                Then, ratably (in proportion to the
respective amounts described in this clause held by them)  to the Lenders, pro
rata in accordance with their respective Pro Rata Shares, and to the
Counterparties under the Specified Interest Rate Contracts until principal under
the Loans and all amounts owing under the Specified Interest Rate Contracts have
been paid in full; and

 

(D)                               Then, to the Lenders, pro rata to each Lender
in accordance with the amount expressed in a percentage, which the amount of
remaining Obligations owed to such Lender bears to all remaining Obligations
held by all Lenders, until all other Obligations have been paid in full
(including, without limitation, costs and expenses payable by Borrower to the
Lenders pursuant to Section 10.14 hereof).

 

(iii)                               The order of priority set forth in
Section 2.5(4)(ii) and the related provisions of this Agreement are set forth
solely to determine the rights and priorities of the Administrative Agent and
the other Lenders as among themselves. The order of priority set forth in
Sections 2.5(4)(ii)(A) through (D) may at any time and from time to time be
changed only with the prior written consent of all Lender’s directly affected
thereby, without necessity of notice to or consent of or approval by the
Borrower or any other Person.  The order of priority set forth in
Section 2.5(4)(ii)(A) may be changed only with the prior written consent of the
Administrative Agent.

 

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2.6                                 Interest.

 

(1)                                  Base Rate Loans.  Each Base Rate Loan shall
bear interest at a rate per annum equal to the Applicable Base Rate.

 

(2)                                  LIBO Rate Loans.  Each LIBO Rate Loan shall
bear interest at a rate per annum equal to the Applicable LIBO Rate for the
Interest Period for such Loans.

 

(3)                                  Payment of Interest.

 

(a)                                  All interest on the Loans that accrues
during the Original Term (“PIK Amounts”) shall not be paid by Borrower to
Administrative Agent on each Payment Date but instead all interest that accrues
during each Interest Period during the Original Term shall be added to the
outstanding principal amount of the Loans on each Payment Date, increasing the
principal amount of the Loans by such PIK Amounts (which increases shall be
credited to each Lender proportionally based on each Lender’s Pro Rata Share of
the Loans), and thereafter interest will accrue on the principal amount of the
Loans as increased by the PIK Amounts theretofore added to the principal amount
of the Loans.

 

(b)                                 Notwithstanding any provision of
Section 2.6(3)(a) to the contrary, in the event that Borrower properly exercises
one or both Options to Extend pursuant to Section 2.3 hereof, then during the
First Extension Term and the Second Extension Term, Borrower shall pay interest
on the Loans monthly, in arrears, on each Payment Date, as set forth on an
interest billing statement delivered by the Administrative Agent to the Borrower
(which delivery may be by facsimile transmission) no later than 1:00 p.m. (New
York time) on a date at least one Business Day prior to the date such interest
is due.

 

(4)                                  Computations.  All computations of LIBO
Rate interest payable hereunder shall be based upon a year of 360 days for the
actual number of days elapsed (which results in more interest being paid than if
computed on the basis of a 365-day year).  All computations of Base Rate
interest and fees payable hereunder shall be based upon a year of 365 days for
the actual number of days elapsed.

 

(5)                                  Default Interest.  During such time as
there shall have occurred and be continuing an Event of Default, all Obligations
outstanding, shall, at the election of the Administrative Agent, bear interest
at the Default Rate.

 

2.7                                 Presumptions of Payment.

 

Unless the Administrative Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Administrative Agent for
the account of the Lenders hereunder that the Borrower will not make such
payment, the Administrative Agent may assume that the Borrower has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due.  In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but

 

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excluding the date of payment to the Administrative Agent, at the Federal Funds
Rate.

 

2.8                                 Pro Rata Treatment.

 

Except to the extent otherwise provided herein:  (1) each Advance shall be
allocated pro rata among the Lenders according to the amounts of their
respective Loans; (2) each payment or prepayment of principal of Loans by the
Borrower shall be made for account of the Lenders pro rata in accordance with
the respective unpaid principal amounts of the Loans held by them; and (3) each
payment of interest on Loans by the Borrower shall be made for the account of
the Lenders pro rata in accordance with the amounts of interest on such Loans
then due and payable to the respective Lenders.

 

2.9                                 Inability to Determine Rates.

 

In the event that the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower absent manifest
error) that by reason of circumstances affecting the interbank market adequate
and reasonable means do not exist for ascertaining the LIBO Rate for any
Interest Period, the Administrative Agent shall forthwith give telephonic notice
of such determination to each Lender and to the Borrower.  If such notice is
given, the Loans shall be converted, on the last day of the Interest Period
applicable thereto, to Base Rate Loans.  If the Loans have been converted to
Base Rate Loans pursuant to the terms of this Section 2.9, but thereafter
adequate and reasonable means shall exist for ascertaining the LIBO Rate, the
Administrative Agent shall give notice thereof to Borrower and each Lender and
convert the Base Rate Loans back to LIBO Rate Loans by delivery to Borrower and
each Lender notice of such conversion no later than one (1) Business Day prior
to the next succeeding Interest Rate Determination Date, in which event the Base
Rate Loans shall be converted to LIBO Rate Loans from, after and including the
first day of the next succeeding Interest Period.

 

2.10                           Illegality.

 

Notwithstanding any other provisions herein, if any Requirement of Law, or any
change therein or in the interpretation or application thereof, shall make it
unlawful for any Lender to maintain LIBO Rate Loans as contemplated by this
Agreement:  (1) the commitment of such Lender hereunder to continue LIBO Rate
Loans or to convert Base Rate Loans to LIBO Rate Loans shall forthwith be
cancelled, and (2) LIBO Rate Loans held by such Lender then outstanding, if any,
shall be converted automatically to Base Rate Loans at the end of their
respective Interest Periods or within such earlier period as may be required by
law.  In the event of a conversion of any LIBO Rate Loan prior to the end of its
applicable Interest Period, the Borrower hereby agrees promptly to pay any
Lender affected thereby, upon demand, the amounts required pursuant to
Section 2.13 below, it being agreed and understood that such conversion shall
constitute a prepayment of a LIBO Rate Loan for all purposes of this
Section 2.10.

 

2.11                           Increased Costs.

 

(1)                                  In the event that any Requirement of Law,
or in the governmental or judicial interpretation or application thereof, or
compliance by any Lender with any request or

 

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directive (whether or not having the force of law) issued by any central bank or
other Governmental Authority:

 

(i)                                     Does or shall subject any Lender to any
Taxes of any kind whatsoever with respect to this Agreement or any of the Loans,
or change the basis of determining the Taxes imposed on payments to such Lender
of principal, fees, interest or any other amount payable hereunder (except for
any change in the rate of tax on the overall net income of such Lender);

 

(ii)                                  Does or shall impose, modify or hold
applicable any reserve, capital requirement, special deposit, compulsory loan or
similar requirements against assets held by, or deposits or other liabilities in
or for the account of, advances or loans by, or other credit extended by, or any
other acquisition of funds by, any  office of such Lender which are not
otherwise included in the determination of interest payable on the Obligations;
or

 

(iii)                               Does or shall impose on such Lender any
other condition;

 

and the result of any of the foregoing is to increase the cost to such Lender of
making, renewing, converting or maintaining its Loans or to reduce any amount
receivable in respect thereof or the rate of return on the capital of such
Lender or any corporation controlling such Lender, then, in any such case, the
Borrower shall, without duplication of amounts payable pursuant to Section 2.14,
promptly pay to such Lender, upon its written demand made through the
Administrative Agent, any additional amounts necessary to compensate such Lender
for such additional cost or reduced amounts receivable or rate of return as
determined by such Lender with respect to this Agreement or such Lender’s Loans,
so long as such Lender requires substantially all obligors under other loans of
this type made available by such Lender to similarly so compensate such Lender.

 

(2)                                  If a Lender becomes entitled to claim any
additional amounts pursuant to Section 2.11(1), it shall promptly notify the
Borrower of the event by reason of which it has become so entitled.  A
certificate specifying the reason for any additional amounts so claimed as
payable and containing the calculation thereof in reasonable detail submitted by
a Lender to the Borrower, accompanied by a certification that such Lender has
required substantially all obligors under other commitments of this type made
available by such Lender to similarly so compensate such Lender, shall
constitute prima facie evidence thereof.

 

(3)                                  Failure or delay on the part of any Lender
to demand compensation pursuant to Section 2.11(2) shall not constitute a waiver
of such Lender’s right to demand such compensation; provided, however, such
right, if not previously demanded, shall terminate upon repayment of such
Lender’s Loan.

 

2.12                           Obligation of Lenders to Mitigate.

 

As promptly as reasonably practicable after the officer of any Lender
responsible for administering such Lender’s Loans becomes aware of any event or
condition that would entitle such Lender to receive payments under Section 2.11
above or Section 2.14 below or to cease maintaining LIBO Rate Loans under
Section 2.10 above, such Lender will use reasonable efforts:  (i) to maintain
its Loans through another lending office of such Lender

 

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or (ii) take such other reasonable measures, if as a result thereof the
additional amounts which would otherwise be required to be paid to such Lender
pursuant to Section 2.11 above or pursuant to Section 2.14 below would be
materially reduced or eliminated or the conditions rendering such Lender
incapable of maintaining LIBO Rate Loans under Section 2.10 above no longer
would be applicable, and if, as determined by such Lender in its sole
discretion, the maintaining of such LIBO Rate Loans through such other lending
office or in accordance with such other measures, as the case may be, would not
otherwise materially adversely affect such LIBO Rate Loans or the interests of
such Lender.

 

2.13                           Funding Indemnification.

 

In the event of (1) the payment of any principal of any LIBO Rate Loan other
than on the last day of an Interest Period applicable thereto (including as a
result of an Event of Default), (2) the conversion of any LIBO Rate Loan other
than on the last day of the Interest Period applicable thereto, (3) the failure
to borrow, convert, continue or prepay any of the Loans on the date specified in
any notice delivered pursuant hereto, or (4) the assignment of any LIBO Rate
Loan, then, in any such event, the Borrower shall compensate each Lender for the
loss, cost and expense attributable to such event.  In the case of a LIBO Rate
Loan, the loss to any Lender attributable to any such event shall be deemed to
include an amount determined by such Lender to be equal to the excess, if any,
of (y) the amount of interest that such Lender would have accrued on the
principal amount of such Loan for the period from the date of such payment,
conversion, failure or assignment to the last day of the then current Interest
Period for such Loan (or, in the case of a failure to borrow, convert or
continue, the duration of the Interest Period that would have resulted from such
borrowing, conversion or continuation) if the interest rate payable on such
deposit were equal to the Reserve Adjusted LIBO Rate for such Interest Period,
over (z) the amount of interest that such Lender would earn on such principal
amount for such period if such Lender were to invest such principal amount for
such period at the interest rate that would be bid by such Lender (or an
affiliate of such Lender) for Dollar deposits from other banks in the eurodollar
market at the commencement of such period.  A certificate of any Lender setting
forth any amount or amounts that such Lender is entitled to receive pursuant to
this Section 2.13 shall be delivered to the Borrower and shall be conclusive
absent manifest error.  The Borrower shall pay such Lender the amount shown as
due on any such certificate within 10 days after receipt thereof.

 

2.14                           Taxes.

 

(1)                                  Any and all payments by or on account of
any obligation of the Borrower hereunder or under any other Loan Document shall
be made free and clear of and without deduction for any Indemnified Taxes or
Other Taxes; provided that if the Borrower shall be required to deduct any
Indemnified Taxes or Other Taxes from such payments, then (i) 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 2.14) the Administrative Agent or Lender (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall
pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.

 

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(2)                                  In addition, the Borrower shall pay any
Other Taxes to the relevant Governmental Authority in accordance with applicable
law.

 

(3)                                  The Borrower shall indemnify the
Administrative Agent and each Lender, within ten (10) Business Days after
written demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section 2.14) paid by the
Administrative Agent or such Lender, as the case may be, and any penalties,
interest (except to the extent such penalties and/or interest arise as a result
of a Lender’s delay in dealing with any such Indemnified Tax) and reasonable
expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability delivered to the Borrower by a Lender or by the
Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.

 

(4)                                  As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.

 

(5)                                  Each Foreign Lender shall deliver to the
Borrower (with copies to the Administrative Agent) on or before the Effective
Date (or in the case of a Foreign Lender who became a Lender by way of an
assignment, on or before the date of the assignment) or at least five
(5) Business Days prior to the first date for any payment herewith to such
Lender, and from time to time as required for renewal under applicable law, IRS
Form W-8BEN or W-8ECI, as appropriate, any other certificate or statement of
exemption required by Section 871(h) or Section 881(c) of the Code as of the
Effective Date, and, in the case of any payment made hereunder after
December 31, 2012 in respect of any Loan, Note or Obligation that was not
treated as outstanding for purposes of FATCA on March 18, 2012, any forms,
documentation or other information as shall be prescribed by the IRS to
demonstrate that such Lender has complied with the applicable reporting
requirements of FATCA, properly completed and duly executed by such Lender
establishing that payments to such Lender hereunder are not subject to
withholding under the Code (“Evidence of No Withholding”).  Each Foreign Lender
shall promptly notify the Borrower and the Administrative Agent of any change in
its applicable lending office and upon written request of the Borrower or the
Administrative Agent shall, prior to the immediately following due date of any
payment by the Borrower hereunder or under any other Loan Document, deliver
Evidence of No Withholding to the Borrower and the Administrative Agent.  The
Borrower shall be entitled to rely on such forms in its possession until receipt
of any revised or successor form pursuant to this Section 2.14(5).  If a Lender
fails to provide Evidence of No Withholding as required pursuant to this
Section 2.14(5), then (i) the Borrower (or the Administrative Agent) shall be
entitled to deduct or withhold from payments to the Administrative Agent or such
Lender as a result of such failure, as required by law, and (ii) the Borrower
shall not be required to make payments of additional amounts with respect to
such withheld Taxes pursuant to Section 2.14(1) to the extent such withholding
is required solely by reason of the failure of such

 

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Lender to provide the necessary Evidence of No Withholding.

 

2.15                           Payment of Fees. All fees payable hereunder shall
be paid on the dates due, in immediately available funds, to the Administrative
Agent for distribution.  Fees paid shall not be refundable under any
circumstances

 

2.16                           Credit Support.

 

(1)                                  Recourse Guaranty.  As credit support for
the Obligations, Recourse Guarantor executed and delivered to Administrative
Agent the Recourse Guaranty.

 

(2)                                  Collateral Documents.  As collateral
security for the Obligations, Holdco, the Borrower and/or the Leasehold Holder
executed and delivered to the Administrative Agent the Collateral Documents.

 

(3)                                  Assignments.  As collateral security for
the Obligations, (a) Borrower and the Leasehold Holder executed and delivered to
the Administrative Agent the Assignment of Contracts and the Assignment of
Leases and Rents, and (b) in connection with the exercise of each of Borrower’s
Options to Extend in accordance with Section 2.3(b) hereof, Borrower shall
execute and deliver to the Administrative Agent a first priority assignment of
the Required Interest Rate Contracts.

 

(4)                                  Preferential Payments.  Notwithstanding
anything to the contrary contained in this Agreement or in any other Loan
Document, if any amount paid on account of the Obligations is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required to
be repaid by any Lender or the Administrative Agent or paid over to a trustee,
receiver or any other entity, whether under any bankruptcy act or otherwise
(such payment, a “Preferential Payment”), then, to the extent of such
Preferential Payment, the Obligations or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made.

 

ARTICLE III
CONDITIONS

 

3.1                                 Effectiveness of Agreement.  The
effectiveness of this Agreement is subject to the satisfaction or waiver of the
following conditions precedent:

 

(1)                                  The Administrative Agent shall have
received (i) this Agreement, executed and delivered by the Loan Parties and the
Lenders, (ii) the Security Instruments, executed and delivered by Borrower and
the Leasehold Holder, as applicable, (iii) the Recourse Guaranty executed and
delivered by Recourse Guarantor, (iv) the Pledge Agreement executed and
delivered by Pledgor, (v) the Note executed by Borrower; (vi) the Security
Agreement executed and delivered by Borrower and the Leasehold Holder; (vii) a
Control Agreement for each Account of the Loan Parties (other than Excluded
Accounts) in favor of the Administrative Agent executed by the applicable Loan
Party, the Administrative Agent and the applicable Account Bank; and  (viii) all
other Loan Documents executed and delivered by all parties

 

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thereto.

 

(2)                                  The Administrative Agent shall have
received satisfactory evidence that (i) the PropCo Loan Documents have been
entered into, to become effective substantially simultaneously with this
Agreement, (ii) the PropCo Administrative Agent shall have determined that the
terms and conditions of the Restructuring Plan are reasonably satisfactory to
PropCo Administrative Agent and the Lenders under the PropCo Credit Agreement
(the “PropCo Lenders”) and the Restructuring Plan has been confirmed by the
Bankruptcy Court pursuant to the Confirmation Order, which has terms and
conditions reasonably satisfactory to PropCo Administrative Agent, (iii) the
Confirmation Order is not subject to a stay and, unless the PropCo
Administrative Agent and the PropCo Lenders have otherwise agreed to proceed
with the transaction under the PropCo Loan Documents, (a) at least fourteen (14)
days shall have passed since the entry of the Confirmation Order and (b) no
appeal shall have been lodged to the Confirmation Order that in the opinion of
the Administrative Agent might adversely affect any of the Loans, impair in any
material respect the effectiveness of the Restructuring Plan or impair in any
material respect the financial condition, business or prospects of any of the
Borrower Parties or any Subsidiary thereof, and (iv) all conditions precedent to
the effectiveness of the Restructuring Plan shall have been satisfied (or
waived) or shall be satisfied (or waived) concurrently in the reasonable
judgment of the Administrative Agent (provided that if PropCo Administrative
Agent and the PropCo Lenders proceed with the transaction under the PropCo
Credit Agreement, such conditions precedent shall be deemed satisfied or
waived).

 

(3)                                  The Lenders and the Administrative Agent
shall have received all fees required to be paid, if any, and all expenses for
which reasonably detailed invoices have been presented, on or before the
Effective Date.

 

(4)                                  Other than as listed on Schedule 4.6, there
shall be no action, suit, investigation or proceeding pending or, to the
knowledge of the Loan Parties, threatened in any court or before any arbitrator
or Governmental Authority that could reasonably be expected to (x) have a
Material Adverse Effect or a Property Material Adverse Effect on the business,
assets, properties, liabilities (actual and contingent), operations or condition
(financial or otherwise) of the Borrower, Leasehold Holder, Holdco, Recourse
Guarantor or the other Borrower Parties, (y) adversely affect the ability of the
Borrower, Leasehold Holder, Holdco, Recourse Guarantor or any other Borrower
Party to perform its obligations under the Loan Documents or (z) adversely
affect the rights and remedies of the Administrative Agent or the Lenders under
the Loan Documents.

 

(5)                                  Administrative Agent shall have received a
certificate of the Secretary or Assistant Secretary of the general partner,
manager or managing member or another Responsible Officer of those Borrower
Parties which are partnerships or limited liability companies attaching copies
of resolutions duly adopted by the Board of Directors of such general partner,
manager or managing member or members, managers or partners of the applicable
Borrower Party, as required by the applicable Organizational Documents,
approving the execution, delivery and performance of the Loan Documents to which
such Borrower Parties are party on behalf of such Borrower Parties and
certifying the names and true signatures of the officers of such Borrower Party
or of such general partner, manager or managing member of the applicable
Borrower Party authorized to sign the Loan Documents to which such Borrower
Parties are party on behalf of

 

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such Borrower Parties.

 

(6)                                  Administrative Agent shall have received a
certificate or certificates of the Secretary or an Assistant Secretary or
another Responsible Officer of those Borrower Parties which are corporations
attaching copies of resolutions duly adopted by the Board of Directors of such
Borrower Parties approving the execution, delivery and performance of the Loan
Documents to which such Borrower Parties are party and certifying the names and
true signatures of the officers of each of such Borrower Parties authorized to
sign the Loan Documents to which such Borrower Parties are party on behalf of
such Borrower Parties.

 

(7)                                  Administrative Agent shall have received
copies of the Organizational Documents of each of the Borrower Parties,
certified, with respect to the formation documents, by the Secretary of State of
the state of formation of such Person as of a recent date, and certified by an
Officer’s Certificate as to the other Organizational Documents.

 

(8)                                  Administrative Agent shall have received a
certificate of authority and good standing or analogous documentation as of a
recent date for each of the Borrower Parties, for each state in which such
Person is organized, formed or incorporated, as applicable, and each state with
respect to which the failure to be in good standing will have or is reasonably
likely to have a Material Adverse Effect with respect to such Person.

 

(9)                                  Administrative Agent  shall have received
opinions of counsel for the Borrower Parties, in form and substance reasonably
acceptable to the Administrative Agent.

 

(10)                            All documents and instruments, including Uniform
Commercial Code financing statements, required by law or reasonably requested by
the Administrative Agent to be filed, registered or recorded to create the Liens
intended to be created by the Loan Documents and perfect such Liens to the
extent required by, and with the priority required, by the Loan Documents, shall
have been executed and be in proper form for filing, subject only to exceptions
satisfactory to the Administrative Agent.

 

(11)                            The representations and warranties of each
Borrower Party set forth in the Loan Documents shall be true and correct in all
material respects on and as of the Effective Date; provided that, to the extent
that such representations and warranties specifically refer to an earlier date,
they shall be true and correct in all material respects as of such earlier date;
provided, further that, any representation and warranty that is qualified as to
“materiality,” “Material Adverse Effect” or similar language shall be true and
correct in all respects on such respective dates.

 

(12)                            After giving full effect to the Restructuring,
no Event of Default or Potential Default shall have occurred and be continuing
as of the Effective Date.

 

(13)                            Administrative Agent shall have received new
Title Policies (or date downs to existing Title Policies, as determined by
Administrative Agent in its reasonable discretion) issued by the Title Company
and dated as of the Effective Date.  Such Title Policies shall (i) provide
coverage in an amount equal to 100% of the aggregate amount of Loans,
(ii) insure that the Security Instruments create a valid, first priority Lien on
the Mortgaged Property, free and clear of all exceptions from coverage other
than Permitted Encumbrances and standard

 

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exceptions and exclusions from coverage (as modified by the terms of any
endorsements), (iii) contain the endorsements and affirmative coverages as
Administrative Agent may reasonably request to the extent available in the State
of Nevada, and (iv) name Administrative Agent as the insured.  Administrative
Agent also shall have received evidence that all premiums in respect of such
Title Policies have been paid.  Administrative Agent shall have received
evidence that all appropriate releases or discharges of encumbrances necessary
for the delivery of the Title Policies have been delivered for recording.

 

(14)                            Administrative Agent shall have received a
current Survey for each Real Property, containing the survey certification
substantially in the form attached hereto as Exhibit B.  Each such Survey shall
reflect the same legal description contained in the Title Policies referred to
in paragraph (14) above and shall include, among other things, a metes and
bounds description or such other description as is required by Title Company, of
the Real Property depicted therein, any such description to be reasonably
satisfactory to Administrative Agent.  The surveyor’s seal shall be affixed to
the Survey.

 

(15)                            Administrative Agent shall have received a
Budget that satisfies the conditions set forth in Section 5.1(5) hereof and is
otherwise acceptable to Administrative Agent.

 

(16)                            Administrative Agent shall have received valid
certificates of insurance for the policies of insurance required hereunder,
satisfactory to Administrative Agent in its sole discretion, and evidence of the
payment of all insurance premiums currently due and payable for the existing
policy period.

 

(17)                            With respect to Ground Lease, Administrative
Agent shall have received an estoppel and agreement from the Ground Lease Fee
Owner in form and substance reasonably acceptable to Administrative Agent.

 

(18)                            Administrative Agent shall have received
satisfactory evidence that the Warrants have been issued to the Lenders pursuant
the Warrant Agreements.

 

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

 

As an inducement to the Administrative Agent and each Lender to enter into this
Agreement, except as set forth on the schedule of exceptions attached hereto as
Schedule 4 hereto, each Loan Party represents and warrants as follows as of the
Effective Date:

 

4.1                                 Financial Condition.

 

(1)                                  The financial statements of each of
Borrower, Tropicana Station, Inc. and Station Casinos, Inc. most recently
delivered by Borrower pursuant to this Agreement, as at the date to which such
statements apply, fairly present the financial condition of each such Person as
at such date and the results of the operations of each such Person for the
period ended on such date, all in conformity with GAAP.

 

(2)                                  Except as set forth on Schedule 4.1, No
Loan Party has any material obligation, material contingent liability or
material liability for taxes, material long-term

 

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leases or unusual forward or long-term material commitment that is not otherwise
permitted by this Agreement.

 

4.2                                 No Material Adverse Effect.  No event has
occurred which has or is reasonably likely to have a Material Adverse Effect or
a Property Material Adverse Effect.

 

4.3                                 Compliance with Laws.  Each of the Loan
Parties is in compliance with all Requirements of Law and is not in default or
in violation of any order, writ, injunction, decree or demand of any
Governmental Authority, except where the failure to do so or such default,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect or a Property Material Adverse Effect.  To the
Knowledge of the Loan Parties, there are no Requirements of Law applicable to
any Borrower Party the compliance with which by such Borrower Party would, in
the aggregate, have a Material Adverse Effect or a Property Material Adverse
Effect.  There has not been committed by any Loan Party any act or omission
affording the federal government or any other Governmental Authority the right
of forfeiture as against any Mortgaged Property or any part thereof or any
monies paid in performance of any Loan Party obligations under any of the Loan
Documents.

 

4.4                                 Organization, Powers; Authorization;
Enforceability.

 

(1)                                  Each Borrower Party (A) is either a
corporation, a limited partnership or a limited liability company duly
incorporated, formed or organized, validly existing, and in good standing under
the laws of the state of its incorporation, organization and/or formation,
(B) is duly qualified to do business and is in good standing under the laws of
each jurisdiction in which the failure to be so qualified and in good standing
will have or is reasonably expected to have a Material Adverse Effect, and
(C) has all requisite corporate, partnership or limited liability company power
and authority to own, operate and encumber its Property and to conduct its
business as presently conducted and as proposed to be conducted in connection
with and following the consummation of the transactions contemplated by this
Agreement.  Borrower is a partnership for purposes of federal income taxation
and for purposes of the tax laws of any state or locality in which it is subject
to taxation based on its income.

 

(2)                                  True, correct and complete copies of the
Organizational Documents of each of the Borrower Parties have been delivered to
the Administrative Agent and have not been Modified except to the extent
indicated therein.  All of the Organizational Documents are in full force and
effect, and there are no defaults under such Organizational Documents (including
with respect to any restrictions on Indebtedness contained therein), and no
events which, with the passage of time or giving of notice or both, would
constitute a default under such Organizational Documents (including with respect
to any restrictions on Indebtedness contained therein).

 

(3)                                  The Borrower Parties have the requisite
power and authority to execute, deliver and perform this Agreement and each of
the other Loan Documents which are required to be executed on their behalf.  The
execution, delivery and performance of each of the Loan Documents which must be
executed in connection with this Agreement by any Borrower Party and to which
any Borrower Party is a party and the consummation of the transactions
contemplated thereby are within such Borrower Party’s partnership, company, or
corporate

 

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powers, have been duly authorized by all necessary partnership, company, or
corporate action and such authorization has not been rescinded. No other
partnership, company, or corporate action or proceedings on the part of any
Borrower Party is necessary to consummate such transactions.

 

(4)                                  Each of the Loan Documents to which any
Borrower Party is a party has been duly executed and delivered on behalf of such
Borrower Party and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms (subject to bankruptcy,
insolvency, reorganization, or other laws affecting creditors’ rights generally
and to principles of equity, regardless of whether considered in a proceeding in
equity or at law), is in full force and effect and all the terms, provisions,
agreements and conditions set forth therein and required to be performed or
complied with by such Borrower Party on or before the Effective Date have been
performed or complied with, and no Potential Default or Event of Default exists
thereunder.

 

4.5                                 No Conflict.  The execution, delivery and
performance of the Loan Documents, the borrowing hereunder, and the use of the
proceeds thereof, will not violate any material Requirement of Law or any
Organizational Document or any material Contractual Obligation of any Borrower
Party; or create or result in the creation of any Lien on any material assets of
any Borrower Party other than the Liens created by the Loan Documents.

 

4.6                                 No Material Litigation.  Except as disclosed
on Schedule 4.6 hereto, no litigation, investigation or proceeding of or before
any arbitrator or Governmental Authority is pending or, to the Knowledge of the
Loan Parties, threatened by or against any Borrower Party or against any such
Person’s Property or revenues which is likely to be adversely determined and
which, if adversely determined, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect or a Property Material
Adverse Effect.  The performance of any action by any Borrower Party required or
contemplated by any Loan Documents is not restrained or enjoined (either
temporarily, preliminarily or permanently).

 

4.7                                 Taxes.  (1)All federal, state, local and
foreign income and franchise and other material Tax returns, reports and similar
statements or filings of the Loan Parties and their respective Tax Affiliates
(collectively, the “Tax Returns”) have been filed with the appropriate
Governmental Authorities in all jurisdictions in which such Tax Returns are
required to be filed, all such Tax Returns are true and correct in all material
respects, and all taxes, charges and other impositions reflected therein have
been paid prior to the date on which any fine, penalty, interest, late charge or
loss may be added thereto for non-payment thereof except to the extent such
Taxes, assessments, fees and other charges of Governmental Authorities are
subject to a Good Faith Contest.  The Loan Parties have no Knowledge of any
proposed tax assessment against any Borrower Party that will have or is
reasonably likely to have a Material Adverse Effect.  There are no pending or
proposed special or other assessments for public improvements or otherwise
affecting the Mortgaged Property, nor are there any contemplated improvements to
the Mortgaged Property that may result in such special or other assessments,
which would, individually or collectively have or would be reasonably likely to
have a Property Material Adverse Effect.  Except as set forth on Schedule 4.7,
no Tax Return is under audit or examination by any Governmental Authority and no
notice of such an audit or examination or any assertion of any claim for Taxes
has been received from any Governmental Authority. 

 

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Proper and accurate amounts have been withheld by Loan Parties and each of their
respective Tax Affiliates from their respective employees for all periods in
full and complete compliance with the tax, social security and unemployment
withholding provisions of applicable Requirements of Law and such withholdings
have been timely paid to the respective Governmental Authorities.

 

(2)                                  Except as set forth on Schedule 4.7, none
of the Loan Parties or any of their respective Tax Affiliates has (i) executed
or filed with the IRS or any other Governmental Authority any agreement or other
document extending, or having the effect of extending, the period for the filing
of any Tax Return or the assessment or collection of any charges, (ii) incurred
any obligation under any tax sharing agreement or arrangement other than those
of which the Administrative Agent has received a copy prior to the Effective
Date, or (iii) been a member of an affiliated, combined or unitary group other
than the group of which the Loan Parties (or their respective Tax Affiliates) is
the common parent.

 

(3)                                  All mortgage, mortgage recording, stamp,
intangible or other similar Tax required to be paid by any Person under
applicable Requirements of Law currently in effect in connection with the
execution, delivery, recordation, filing, registration, perfection or
enforcement of any of the Loan Documents, including, without limitation, the
Security Instruments, have been paid or have been collected by the closing agent
for payment.

 

4.8                                 Regulated Entities.  None of the Borrower
Parties, nor any Person Controlling such entities, is an “investment company” or
an “affiliated Person” of, or “promoter” or “principal underwriter” for, or
otherwise “controlled” by an “investment company,” as such terms are defined in
the Investment Company Act of 1940, as amended.  None of the Borrower and its
Subsidiaries (1) is subject to regulation under the Federal Power Act, the
Interstate Commerce Act, any state public utilities code, or, other than Gaming
Law, any other Federal or state statute or regulation limiting its ability to
incur Indebtedness, or (2) is a “foreign Person” within the meaning of
Section 1445 of the Code.

 

4.9                                 Borrower Parties.  The Borrower Parties have
fully disclosed to Administrative Agent all material aspects of the ownership
structure of the Borrower Parties and have disclosed to Administrative Agent
(1) the correct legal name of each such Person, the type of organization, and
the jurisdiction of its incorporation or organization, and (2) the class of
outstanding Capital Stock of Borrower along with the percentage thereof owned,
directly or indirectly, by the Borrower Parties.  None of such issued and
outstanding Capital Stock is subject to any vesting, redemption, or repurchase
agreement, and there are no warrants or options outstanding with respect to such
Capital Stock, except for the Warrants, the Warrant Agreements and as disclosed
in Schedule 4.9.

 

4.10                           Federal Reserve Board Regulations.  None of the
Borrower Parties is engaged or will engage, principally or as one of its
important activities, in the business of extending credit for the purpose of
“purchasing” or “carrying” any “Margin Stock” within the respective meanings of
such terms under Regulations T, U and X.  No part of the proceeds of the Loans
will be used for “purchasing” or “carrying” “Margin Stock” as so defined or for
any purpose which violates, or which would be inconsistent with, the provisions
of, the Regulations of the Board of Governors of the Federal Reserve System.

 

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4.11                           ERISA Compliance.  Except as disclosed on
Schedule 4.11:

 

(1)                                  Each Plan is in compliance with the
applicable provisions of ERISA, the Code and other federal or state law failure
to comply with which would reasonably be likely to result in a Material Adverse
Effect.  Each Plan which is intended to qualify under Section 401(a) of the Code
has received a favorable determination letter from the IRS and to the  Knowledge
of the Loan Parties, nothing has occurred which would cause the loss of such
qualification.

 

(2)                                  There are no pending or, to the Knowledge
of the Loan Parties, threatened claims, actions or lawsuits, or action by any
Governmental Authority, with respect to any Plan which has resulted or could
reasonably be expected to result in a Material Adverse Effect.  There has been
no prohibited transaction or violation of the fiduciary responsibility
rules with respect to any Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect.

 

(3)                                  No ERISA Event has occurred or is
reasonably expected to occur with respect to any Pension Plan or, to the
Knowledge of the Loan Parties, Multiemployer Plan which has resulted or could
reasonably be expected to result in a Material Adverse Effect.

 

(4)                                  No Pension Plan has any Unfunded Pension
Liability which has resulted or could reasonably be expected to result in a
Material Adverse Effect.

 

(5)                                  None of the Borrower Parties or their
respective Subsidiaries, nor any ERISA Affiliate has incurred, nor reasonably
expects to incur, any liability under Title IV of ERISA with respect to any
Pension Plan (other than premiums due and not delinquent under Section 4007 of
ERISA) which has resulted or could reasonably be expected to result in a
Material Adverse Effect.

 

(6)                                  None of the Borrower Parties or their
respective Subsidiaries, nor any ERISA Affiliate has incurred nor reasonably
expects to incur any liability (and no event has occurred which, with the giving
of notice under Section 4219 of ERISA, would result in such liability) under
Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan which has
resulted or could reasonably be expected to result in a Material Adverse Effect.

 

(7)                                  None of the Borrower Parties or their
respective Subsidiaries, nor any ERISA Affiliate has transferred any Unfunded
Pension Liability to any Person or otherwise engaged in a transaction that is
subject to Section 4069 or 4212(c) of ERISA which has resulted or could
reasonably be expected to result in a Material Adverse Effect.

 

4.12                           Assets and Liens.

 

(1)                                  Borrower has good and marketable fee title
to the Mortgaged Property (other than the Ground Lease Parcel), free and clear
of all Liens whatsoever except the Permitted Encumbrances, and Leasehold Holder
has valid and existing leasehold title to the Ground Lease Parcel, free and
clear of all Liens whatsoever except the Permitted Encumbrances.  The Mortgaged
Property constitutes all of the Property currently owned, leased or licensed by
the Borrower and the Leasehold Holder.

 

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(2)                                  The Security Instruments, when properly
recorded in the appropriate records, together with any Uniform Commercial Code
financing statements required to be filed in connection therewith, will create
(i) a valid, perfected first mortgage lien on the Real Property and the
Improvements, subject only to Permitted Encumbrances and (ii) perfected security
interests in and to, and perfected collateral assignments of, all personalty
(including the Leases), all in accordance with the terms thereof, in each case
subject only to any applicable Permitted Encumbrances.  Except as may be
indicated in and insured over by the Title Policies, to the Knowledge of the
Loan Parties there are no claims for payment for work, labor or materials
affecting the Mortgaged Property which are or may become a lien prior to, or of
equal priority with, the Liens created by the Loan Documents.  None of the
Permitted Encumbrances will have a material adverse affect on the Mortgaged
Property which they encumber.  Borrower and the Leasehold Holder shall preserve
Borrower’s and Leasehold Holder’s right, title and interest in and to the
Mortgaged Property for so long as any Obligations remain outstanding and will
warrant and defend same and the validity and priority of the Lien of the
Security Instruments from and against any and all claims whatsoever other than
the Permitted Encumbrances.

 

(3)                                  The provisions of the Pledge Agreement and
the provisions of the Collateral Documents are effective to create in favor of
the Administrative Agent for the benefit of the Secured Parties a legal, valid
and enforceable first priority Lien (subject to Permitted Encumbrances) on all
right, title and interest of the respective Borrower Parties in the Collateral,
and no filing, recording, registration or other action will be necessary to
perfect or protect such Liens, except (A) for the filing of all applicable
Uniform Commercial Code financing statements and all applicable filings with the
United States Copyright Office to be filed on the Effective Date or immediately
thereafter and (b) as provided under Requirements of Law with respect to the
filing of continuation statements for previously filed Uniform Commercial Code
financing statements.  None of the Permitted Encumbrances will have a material
adverse effect on the Collateral which they encumber.  Each Borrower Party shall
preserve its right, title and interest in and to the Collateral pledged under
the Pledge Agreement and the other Collateral Documents for so long as any
Obligations remain outstanding and will warrant and defend same and the validity
and priority of the Lien of the Pledge Agreement and the other Collateral
Documents from and against any and all claims whatsoever other than the
Permitted Encumbrances.

 

4.13                           Securities Acts.  No Loan Party has issued any
unregistered securities in violation of the registration requirements of
Section 5 of the Securities Act of 1933 (as amended from time to time, the
“Act”) or any other law, nor is any Loan Party in violation of any rule,
regulation or requirement under the Act, or the Securities Exchange Act of 1934
(as amended from time to time) other than violations which could not reasonably
be expected to have a Material Adverse Effect.  No Loan Party is required to
qualify an indenture under the Trust Indenture Act of 1939 (as amended from time
to time) in connection with its execution and delivery of this Agreement or the
incurrence of Indebtedness hereunder.

 

4.14                           Consents, Etc.  Except as disclosed in Schedule
4.14, no consent, approval or authorization of, or registration, declaration or
filing with any Governmental Authority or any other Person is required (1) in
connection with the execution and delivery of the Loan Documents by the Borrower
Parties; or (2) the performance of or compliance with the terms,

 

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provisions and conditions of the Loan Documents by such Persons, other than
those that have been obtained, copies of which have been delivered to the
Administrative Agent and each of which on the Effective Date will be in full
force and effect.

 

4.15                           Hazardous Materials.  The Borrower has provided
copies of the Phase I and the other environmental assessments as set forth in
Schedule 4.15 to the Administrative Agent.  Except as otherwise disclosed in the
assessments listed on Schedule 4.15: (1) during the period of ownership of any
interest in any Mortgaged Property by any of Borrower or the Leasehold Holder or
any Affiliate of Borrower or the Leasehold Holder, such Mortgaged Property (or
any portion thereof) has not been used for the purpose of, or in any way
involving, the handling, manufacture, treatment, storage, use, generation,
release, discharge, refining, dumping or disposal of any Hazardous Materials on,
under, in or about the Mortgaged Property, or transporting any Hazardous
Materials to, from or across the Mortgaged Property, in each case, in a manner
that would reasonably be expected to have a Property Material Adverse Effect,
and to the Knowledge of the Loan Parties, no such use occurred at any time prior
to the period of ownership of such Mortgaged Property by any of Borrower, the
Leasehold Holder or any Affiliate of Borrower or the Leasehold Holder;
(2) Borrower and the Leasehold Holder have obtained all material environmental,
health and safety permits and licenses necessary for their respective
operations, and all such permits are in good standing and the holder of each
such permit is currently in compliance with all terms and conditions of such
permits, except for any such failure to obtain, maintain in good standing or
comply that would not reasonably be expected to have a Property Material Adverse
Effect; (3) none of the Mortgaged Property is listed or, to the knowledge of the
Loan Parties, proposed for listing on the National Priorities List (“NPL”)
pursuant to CERCLA or on the Comprehensive Environmental Response Compensation
Liability Information System List (“CERCLIS”) or any similar applicable state
list of sites requiring remedial action under any Hazardous Materials Laws;
(4) none of Borrower, the Leasehold Holder or any Affiliate of Borrower or the
Leasehold Holder which previously held title to the Mortgaged Property has sent
or directly arranged for the transport of any hazardous waste to any site listed
or, to the knowledge of the Loan Parties, proposed for listing on the NPL,
CERCLIS or any similar state list, where any such arrangement for transportation
would reasonably be expected to have a Property Material Adverse Effect; and
(5) to the Knowledge of the Loan Parties, there is not now on or in any
Mortgaged Property: (i) any landfill or surface impoundment; (ii) any
underground storage tanks; (iii) any asbestos-containing material; or (iv) any
polychlorinated biphenyls (PCB), which in the case of any of clauses (i) through
(iv) the presence of which would reasonably be expected to have a Property
Material Adverse Effect.

 

Except as otherwise disclosed in the assessments listed on Schedule 4.15, (x) to
the Knowledge of the Loan Parties, no Hazardous Materials are presently
constructed, deposited, stored, or otherwise located on, under, in or about the
Mortgaged Property in amounts or concentrations that would reasonably be
expected to have a Property Material Adverse Effect; (y) to the Knowledge of the
Loan Parties, no Hazardous Materials have migrated from the Mortgaged Property
upon or beneath other properties which would reasonably be expected to result in
material liability for Borrower or Leasehold Holder; and (z) to the Knowledge of
the Loan Parties, no Hazardous Materials have migrated or threaten to migrate
from other properties upon, about or beneath the Mortgaged Property which would
reasonably be expected to result in material liability for Borrower or the
Leasehold Holder, except for any such liability that would not reasonably be
expected to have a Property Material Adverse Effect.

 

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4.16                           Intellectual Property.  Each of Borrower and
Leasehold Holder owns or is licensed or otherwise has the right to use all of
the patents, trademarks, service marks, trade names and copyrights that are
necessary for the operation of its businesses, without any conflict with the
rights of any other Person that could reasonably be expected to have a Material
Adverse Effect.  To the Knowledge of the Loan Parties, no slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by the Borrower or Leasehold
Holder infringes upon any rights held by any other Person.

 

4.17                           Insurance.  Schedule 4.17 accurately describes
the insurance coverages for the Borrower and the Leasehold Holder as of the
Effective Date.  Such insurance coverages are currently in full force and effect
and in compliance with the applicable requirements of Section 5.5.  The Borrower
has obtained and delivered to the Administrative Agent evidence of all insurance
policies as required under Section 5.5.  None of Borrower or Leasehold Holder
has, and to the Knowledge of the Loan Parties no Person has, done by act or
omission anything that would impair the coverage of any such policy.

 

4.18                           Full Disclosure.  The information provided to the
Administrative Agent and the Lenders by or on behalf of the Borrower Parties
relating to such Persons and the transactions contemplated under the Loan
Documents does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements contained therein or
herein not materially misleading.

 

4.19                           Brokers.  None of the Borrower Parties has dealt
with any broker or finder with respect to the transactions embodied in this
Agreement and the other Loan Documents.

 

4.20                           No Default.  After giving full effect to the
Restructuring, no Potential Default or Event of Default has occurred and is
continuing.

 

4.21                           Contractual Obligations.  None of the Borrower
Parties is a party to any Contractual Obligation which is reasonably likely to
have a Material Adverse Effect or a Property Material Adverse Effect; provided
that the parties hereto acknowledge and agree that any increase in the rent
payable under the Ground Lease (other than increases resulting from a default
thereunder) pursuant to the express terms of the Ground Lease shall not be
deemed likely to have a Material Adverse Effect for purposes of this
Section 4.21. None of the Borrower Parties is in default in any respect in the
performance, observance or fulfillment of any of its Contractual Obligations,
which default is reasonably likely to have a Material Adverse Effect or a
Property Material Adverse Effect.  No Loan Party has any material financial
obligation (contingent or otherwise) under any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which it is a party or
by which it or any Collateral is otherwise bound, other than (1) obligations
incurred in the ordinary course of the operation of the Mortgaged Property,
(2) Permitted Encumbrances, and (3) obligations under the Loan Documents.

 

4.22                           Representations Regarding the Mortgaged Property.

 

(1)                                  Condemnation and Casualty.  No Condemnation
has been commenced

 

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or, to the Knowledge of the Loan Parties, is contemplated with respect to all or
any material portion of the Mortgaged Property.  No portion of the Mortgaged
Property has been materially damaged as a result of any Casualty.

 

(2)                                  Assessments.  To the Knowledge of the Loan
Parties, except as disclosed in the Title Policies, on the real estate tax bills
(copies of which tax bills have been provided to Administrative Agent), there
are no pending or proposed special or other assessments for public improvements
or otherwise affecting the Mortgaged Property, nor are there any contemplated
improvements to the Mortgaged Property that may result in such special or other
assessments.

 

(3)                                  Flood Plain.  The Mortgaged Property is not
located in an area identified by the Federal Emergency Management Agency as an
area having special flood hazards, except as disclosed on the Survey or flood
certifications or if located in such area, that status has been disclosed to
Administrative Agent via delivery of a flood plain map or flood certifications
and does not unreasonably impair the value of the subject Mortgaged Property.

 

(4)                                  No Prior Assignment.  There are no prior
sales, transfers or assignments of any portion of the Rents due and payable or
to become due and payable which are presently outstanding following the funding
of the Loans, other than those being assigned to the Administrative Agent
concurrently herewith.

 

(5)                                  Leases.  The Mortgaged Property is not
subject to any Leases demising any portion of the Mortgaged Property other than
the Existing Leases.  No Person has any possessory interest in the Mortgaged
Property or right to occupy the same except under and pursuant to the provisions
of the Existing Leases and the Ground Lease (with respect to the Ground Lease
Parcel) or other Permitted Encumbrances.  Each of Borrower and Leasehold Holder
is in compliance in all material respects with its obligations under each of the
Existing Leases and the Ground Lease, as applicable.  There are no material
defaults under the Permitted Encumbrances by Borrower or Leasehold Holder, or to
the Knowledge of the Loan Parties any other Person, and to the Knowledge of the
Loan Parties there are no conditions that, with the passage of time or the
giving of notice, or both, would constitute material defaults thereunder.  All
construction and other obligations of a material nature to be performed by the
Borrower or Leasehold Holder under the Ground Lease and the Permitted
Encumbrances either have been satisfied or are reasonably capable of being
satisfied without undue expense in accordance with the provisions of the Ground
Lease or the subject Permitted Encumbrance.  Any payments by the Borrower or
Leasehold Holder due to the other parties to the Ground Lease or Permitted
Encumbrances for tenant improvements, infrastructure or land development have
been made to the extent then required.  No Person party to any Approved Lease,
Ground Lease or any Permitted Encumbrance is entitled to any material offsets,
abatements or deductions against the Rent payable thereunder from and after the
Effective Date.

 

(6)                                  Options to Acquire.  Other than Leasehold
Holder’s and Borrower’s option to purchase the Ground Lease Fee Owner’s interest
in the Ground Lease Parcel under the Ground Lease, none of the Mortgaged
Property is subject to any right of first refusal, right

 

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of first offer or other options to purchase.

 

(7)                                  Licenses.  All material certifications,
permits (including, without limitation, all Gaming Permits), licenses and
approvals, including without limitation, certificates of completion and
occupancy permits required of Borrower or Leasehold Holder for the legal use,
occupancy and operation of each Mortgaged Property and the improvements thereon
(including without limitation, use of the Hotel/Casino Facility as a hotel and
casino), to the extent applicable, for its current respective use (collectively,
the “Licenses”), have been obtained and are in full force and effect (except to
the extent any such failure would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect).  The Loan
Parties shall keep and maintain all Licenses necessary for the operation of each
Mortgaged Property, to the extent applicable, in accordance with its current
respective use (including, without limitation, the operation of Hotel/Casino
Facility as a hotel and casino with unrestricted gaming activities therein, as
applicable).  The use being made of each Mortgaged Property is in conformity
with the certificate of occupancy issued for such Mortgaged Property, to the
extent applicable (except to the extent any such failure would not, individually
or in the aggregate, reasonably be expected to result in a Material Adverse
Effect). All Gaming Permits required to be held by Borrower and Leasehold Holder
are current and in good standing and Borrower and Leasehold Holder presently
hold all Gaming Permits necessary for the continued operation of the
Hotel/Casino Facility as a non-restricted gaming facility.

 

(8)                                  Legal Compliance.  Borrower, Leasehold
Holder and each respective Mortgaged Property and the use thereof (including use
of the Hotel/Casino Facility as a hotel and casino) comply in all material
respects with all Requirements of Law, including, without limitation, building
and zoning ordinances and codes (except for any non-compliance that individually
or in the aggregate would not reasonably be expected to result in a Material
Adverse Effect) and Gaming Laws.  To the best knowledge of the Loan Parties,
none of Borrower or Leasehold Holder is in material default under or in
violation of any order, writ, injunction, decree or demand of any Governmental
Authority (including any Gaming Authority).  To the best knowledge of the Loan
Parties, there has not been committed by Borrower or Leasehold Holder any act or
omission affording the federal government or any other Governmental Authority
the right of forfeiture as against the Mortgaged Property or any part thereof or
any monies paid in performance of Borrower’s or Leasehold Holder’s or any other
Borrower Party’s obligations under any of the Loan Documents.

 

4.23                           Single Purpose Entity.  Each Loan Party is a
Single Purpose Entity.

 

4.24                           Labor.  There are no strikes, work stoppages,
slowdowns or lockouts pending or to the Knowledge of the Loan Parties,
threatened against or involving the Borrower or Leasehold Holder, other than
those listed on Schedule 4.24A or that in the aggregate would not have a
Material Adverse Effect.  There are no unfair labor practices, grievances or
complaints pending, or, to the Knowledge of the Loan Parties, threatened,
against or involving the Borrower or Leasehold Holder, nor are there any pending
or, to the Knowledge of the Loan Parties, threatened arbitrations or grievances
involving the Borrower or Leasehold Holder, other than those listed on Schedule
4.24B or those that, in the aggregate, if resolved adversely to the Borrower or
Leasehold Holder, as applicable, would not have a Material Adverse Effect.

 

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4.25                           Taxpayer Identification Number.  The federal
taxpayer identification number of each Loan Party is as set forth in Schedule
4.25.

 

4.26                           Anti-Terrorism Laws.

 

(1)                                  No Loan Party or, to the Knowledge of the
Loan Parties, any of the Borrower Parties or any of their respective Affiliates
is in violation of any laws relating to terrorism or money laundering
(“Anti-Terrorism Laws”), including Executive Order No. 13224 on Terrorist
Financing, effective September 23, 2001 (the “Executive Order”), and the Uniting
and Strengthening America by Providing Appropriate Tools Required to Intercept
and Obstruct Terrorism Act of 2001, Public Law 107-56 (signed into law on
October 26, 2001) (the “USA Patriot Act”).

 

(2)                                  No Loan Party or, to the Knowledge of the
Loan Parties, any of the other Borrower Parties or any of their respective
Affiliates acting or benefiting in any capacity in connection with the Loans is
any of the following:

 

(i)                                     a Person or entity that is listed in the
annex to, or is otherwise subject to the provisions of, the Executive Order;

 

(ii)                                  a Person or entity owned or controlled by,
or acting for or on behalf of, any Person or entity that is listed in the annex
to, or is otherwise subject to the provisions of, the Executive Order;

 

(iii)                               a Person or entity with which any Lender is
prohibited from dealing or otherwise engaging in any transaction by any
Anti-Terrorism Law;

 

(iv)                              a Person or entity that commits, threatens or
conspires to commit or supports “terrorism” as defined in the Executive Order;
or

 

(v)                                 a Person or entity that is named as a
“specially designated national and blocked Person” on the most current list
published by the U.S. Treasury Department Office of Foreign Assets Control at
its official website or any replacement website or other replacement official
publication of such list.

 

(3)                                  No Loan Party, the Leasehold Holder or, to
the Knowledge of the Loan Parties, any other Borrower Parties or any of their
respective Affiliates acting in any capacity in connection with the Loans
(i) conducts any business or engages in making or receiving any contribution of
funds, goods or services to or for the benefit of any Person described in
Section 4.26(2) above, (ii) deals in, or otherwise engages in any transaction
relating to, any property or interests in property blocked pursuant to the
Executive Order, or (iii) engages in or conspires to engage in any transaction
that evades or avoids, or has the purpose of evading or avoiding, or  attempts
to violate, any of the prohibitions set forth in any Anti-Terrorism Law.

 

4.27                           Accounts.  Schedule 4.27 hereof sets forth, as of
the Effective Date, a complete and accurate list of all Accounts maintained with
any bank or other financial institution by the Loan Parties, each of which
financial institutions shall be an Approved Bank and shall (other than with
respect to Excluded Accounts) have executed a Control Agreement.

 

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4.28                           Intentionally Omitted.

 

4.29                           Ground Leases.

 

(1)                                  The Borrower has delivered to
Administrative Agent a true, correct and complete copy of the Ground Lease. 
Leasehold Holder is the sole tenant and holder of a valid and existing Leasehold
Estate under the Ground Lease, and the interest of Leasehold Holder thereunder
has not been assigned, transferred, pledged, hypothecated or otherwise
encumbered (except for the security interest granted by the Leasehold Holder to
the Lender under the Security Instruments);

 

(2)                                  The Ground Lease is in full force and
effect and has not been Modified or assigned, and the Leasehold Holder has not
waived, canceled or surrendered any of its respective rights thereunder;

 

(3)                                  The Ground Lease does not require the
continued use of any Mortgaged Property (i) under any designated trade name or
(ii) for any single designated required use (other than use categories such as
hotel and casino operations or similarly broad categories that would not have a
Material Adverse Effect);

 

(4)                                  All sums, charges, fees, costs, expenses,
rent, additional rent, common charges, common area maintenance charges and other
charges or assessments reserved in or payable under the Ground Lease, including
without limitation, all sums, charges, fees, assessments, costs, and expenses in
connection with any taxes, site preparation and construction, non-shareholder
contributions, and common area and other property management activities, are
current, and no Lien (other than the Permitted Encumbrances) with respect
thereto has attached or been recorded on the Ground Lease Parcel (or threat
thereof been made in writing) for failure to pay any of the foregoing;

 

(5)                                  Neither Leasehold Holder nor Ground Lease
Fee Owner has delivered or received any notices of default under the Ground
Lease and Leasehold Holder is not in default under the Ground Lease, and neither
Leasehold Holder nor Ground Lease Fee Owner or any other party to the Ground
Lease has commenced any action or given or received any notice for the purpose
of terminating the Ground Lease;

 

(6)                                  To the best knowledge of the Loan Parties,
neither Ground Lease Fee Owner nor any other party to the Ground Lease is in
default under any of the terms of the Ground Lease and there are no
circumstances which, with the passage of time or the giving of notice, or both,
would constitute a default under any terms of the Ground Lease by Ground Lease
Fee Owner or any other party that would have a Material Adverse Effect, and, as
of the Effective Date, neither Ground Lease Fee Owner nor any other party to the
Ground Lease has transferred, assigned, hypothecated or encumbered the fee
interest in the Ground Lease Parcel;

 

(7)                                  All construction obligations required to be
performed as of the Effective Date by the Leasehold Holder under the Ground
Lease have been satisfied in all material respects;

 

(8)                                  The Ground Lease Parcel Purchase Option is
in full force and effect

 

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and no Loan Party has exercised or given any written notice to the Ground Lease
Fee Owner concerning the exercise of the Ground Lease Parcel Purchase Option;
and

 

(9)                                  To the best knowledge of the Loan Parties,
all easements granted pursuant to the Ground Lease which were to have survived
the site preparation and completion of construction, remain in full force and
effect and have not been released, terminated, extinguished or discharged by
agreement or otherwise, except to the extent it would not be expected to result
in a Material Adverse Effect.

 

4.30                           Management Agreements.

 

(1)                                  The Borrower has delivered to
Administrative Agent a true, correct and complete copy of each of the Management
Agreements, and neither the respective interest of the Leasehold Holder,
Borrower nor the applicable Manager under any Management Agreement has been
assigned, transferred, pledged, hypothecated or otherwise encumbered (except for
the security interest granted by the Leasehold Holder to the Administrative
Agent under the Collateral Documents);

 

(2)                                  Each Management Agreement is in full force
and effect and has not been Modified, and neither the Leasehold Holder, Borrower
nor the applicable Manager thereunder has waived, canceled or surrendered any of
its rights thereunder;

 

(3)                                  All sums, charges, fees, costs, expenses
and other charges reserved in or payable under the Management Agreements,
including without limitation, all sums, charges, fees, costs, and expenses in
connection with any taxes, site preparation and construction, non-shareholder
contributions, and common area and other property management activities, are
current, and no Lien with respect thereto has attached or been recorded on any
of the Collateral (or threat thereof been made in writing) for failure to pay
any of the foregoing;

 

(4)                                  Neither the Leasehold Holder, Borrower nor
the applicable Manager has delivered or received any notices of default under
any Management Agreement, and neither the Leasehold Holder, Borrower nor the
applicable Manager or any other party to any Management Agreement has commenced
any action or given or received any notice for the purpose of terminating any
Management Agreement; and

 

(5)                                  Neither the Leasehold Holder, Borrower nor
the applicable Manager or any other party to any Management Agreement is in
default under any of the terms of any Management Agreement and there are no
existing circumstances which, with the passage of time or the giving of notice,
or both, would constitute a default under any terms of any Management Agreement
by the Leasehold Holder, Borrower or any other party that would have a Material
Adverse Effect, and neither the Leasehold Holder nor Borrower or any other party
to any Management Agreement has transferred, assigned, hypothecated or
encumbered its interest in any Management Agreement, except as provided under
the Loan Documents.

 

4.31                           Option Parcels.

 

(1)                                  Borrower has delivered to Administrative
Agent a true, correct and

 

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complete copy of the Option Agreement.  Borrower has not assigned, transferred,
pledged, hypothecated or otherwise encumbered its interest in and to the Option
Parcels or its interest under the Option Agreement;

 

(2)                                  The Option Agreement is in full force and
effect, and has not been Modified or assigned, and Borrower has not waived,
canceled or surrendered any of its rights thereunder;

 

(3)                                  Except as provided on Schedule 4.31, none
of the transactions contemplated in the Restructuring in any case: (a) require
the consent or approval of or notice to any party to the Option Agreement or
(b) will constitute a default under the Option Agreement that would have a
Material Adverse Effect;

 

(4)                                  Borrower has not delivered or received any
notices of default under the Option Agreement and Borrower is not in default
under any term of such Option Agreement, and Borrower has not commenced any
action or given or received any notice for the purpose of terminating the Option
Agreement;

 

(5)                                  To the best knowledge of the Loan Parties,
neither the Option Parcels Fee Owner or any other party to the Option Agreement
is in default under any of the terms of the Option Agreement and there are no
circumstances which, with the passage of time or the giving of notice, or both,
would constitute a default under any terms of the Option Agreement by the Option
Parcels Fee Owner or any other party that would have a Material Adverse Effect,
and, as of the Effective Date, neither the Option Parcels Fee Owner nor any
other party to the Option Agreement has transferred, assigned, hypothecated or
encumbered its interest in, to and under the Option Agreement or its fee
interest in the Option Parcels; and

 

(6)                                  As of the Effective Date, Borrower has not
exercised or given any written notice to Option Parcels Fee Owner concerning the
exercise of the Option Parcels Purchase Option with respect to any of the Option
Parcels.

 

4.32                           Restructuring.  The Restructuring Plan has been
confirmed by the Bankruptcy Court pursuant to the Confirmation Order, and
Recourse Guarantor owns and controls, directly, one hundred percent (100%) of
the Capital Stock of Holdco, subject to the Warrants and the terms of the
Warrant Agreements, Holdco owns and controls, directly, one hundred percent
(100%) of the Capital Stock of each of Borrower and Leasehold Holder, all as
shown on the organization chart attached hereto as Exhibit C, which Borrower
represents to be true and correct.

 

ARTICLE V
AFFIRMATIVE COVENANTS.

 

Each Loan Party hereby covenants and agrees with the Administrative Agent and
each Lender that, as long as any Loans remain unpaid, it will do, and cause any
Borrower Party to do directly or indirectly, the following:

 

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5.1                                 Reporting Requirements

 

The Borrower shall furnish to the Administrative Agent each of the following:

 

(1)                                  Quarterly Reports.  As soon as available,
but in any event within forty-five (45) days following the end of each fiscal
quarter of each fiscal year of the Loan Parties beginning with the first full
fiscal quarter after the Closing Date, the Loan Parties shall deliver to
Administrative Agent a consolidated balance sheet of the Loan Parties as at the
end of such fiscal quarter, and the related (i) consolidated statements of
income or operations for such fiscal quarter and for the portion of the fiscal
year then ended and (ii) consolidated statements of cash flows for the portion
of the fiscal year then ended, setting forth in each case in comparative form
(A) the figures for the corresponding fiscal quarter of the previous fiscal year
and the corresponding portion of the previous fiscal year and (B) comparisons to
budget for such fiscal quarter and the portion of the fiscal year then ended,
for the elapsed portion of the fiscal year then ended, all in reasonable detail
and certified by a Responsible Officer of the Borrower, Leasehold Holder and
Holdco as fairly presenting in all material respects the financial condition,
results of operations and cash flows of the Borrower, Leasehold Holder and
Holdco in accordance with GAAP, subject only to normal year-end audit
adjustments and the absence of footnotes.

 

(2)                                  Monthly Reports. As soon as available, but
in any event within thirty (30) days after the end of each fiscal month of the
Loan Parties beginning with the first full fiscal month after the Closing Date,
Loan Parties shall deliver to Administrative Agent (i) a monthly revenue report
in respect of the Mortgaged Properties for such fiscal month, for the
corresponding fiscal month of the previous fiscal year and for the corresponding
portion of previous fiscal year and (ii) consolidated statements of income or
operations of the Loan Parties for such fiscal month and for the portion of the
fiscal year then ended, all in reasonable detail and certified by a Responsible
Officer of the Borrower, Leasehold Holder and Holdco as fairly presenting in all
material respects the financial condition and results of operations of the
Borrower, Leasehold Holder and Holdco in accordance with GAAP, subject only to
normal year-end audit adjustments and the absence of footnotes.

 

(3)                                  PropCo Reports.  Contemporaneously with the
delivery of such items under the PropCo Credit Agreement, but in any event
within the time periods required for the delivery of such items under the PropCo
Credit Agreement, Borrower shall deliver to Administrative Agent the financial
statements, reports and certifications required to be delivered under
Section 6.01(a), (b), (c), (d), (e), (f) and (g) and Section 6.02(b) of the
PropCo Credit Agreement. Any such financial statements shall be accompanied by
an Officer’s Certificate in the form required pursuant to Section 5.1(1).

 

(4)                                  Compliance Certificate.  Together with each
delivery of any report pursuant to clause (1) of this Section 5.1, Borrower
shall deliver to Administrative Agent the following: (i) a certificate of a
Responsible Officer of the Borrower (each, a “Compliance Certificate”), in
substantially the form delivered under the Original Credit Agreement, stating
that no Potential Default or Event of Default has occurred and is continuing or,
if a Potential Default or an Event of Default has occurred and is continuing,
stating the nature thereof and the action that the Borrower propose to take with
respect thereto (ii) Borrower’s calculation of Excess Cash Flow for such fiscal
quarter, such calculation providing reasonable detail (including the amount of
any Unrestricted Cash  being maintained by the Loan Parties

 

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pursuant to Section 2.5(1)(ii) hereof) and being accompanied by an Officer’s
Certificate certifying to the best of the signer’s knowledge, that such
calculations fairly represent the Excess Cash Flow for such quarter; and
(iii) Borrower’s calculation of Consolidated Hotel/Casino Facility EBITDA for
such fiscal quarter, such calculation providing reasonable detail and being
accompanied by an Officer’s Certificate certifying to the best of the signer’s
knowledge, that such calculations fairly represent the Consolidated Hotel/Casino
Facility EBITDA for such quarter.

 

(5)           Budget. As soon as available, and in any event no later than
thirty (30) days after the end of each fiscal year of the Borrower and the
Leasehold Holder, (i) an operating and capital expenditure budget (in each case
presented on a monthly and annual basis) (each a “Budget”) for the Borrower and
the Leasehold Holder for the following fiscal year and (ii) forecasts prepared
by management of the Borrower and the Leasehold Holder, in form and substance
reasonably acceptable to the Administrative Agent, including projected balance
sheets, income statements and cash flow statements on a monthly basis for such
following fiscal year and on a quarterly basis for the six fiscal years
thereafter.  Each such proposed Budget shall identify and set forth the
Borrower’s and the Leasehold Holder’s best estimate, after due consideration, of
all revenue, costs, and expenses for the Borrower and the Leasehold Holder, and
shall specify gross revenues and operating expenses, including, without
limitation, amounts due monthly and annually under the Ground Lease, the
Material Agreements, the Management Agreements, for Impositions, for Insurance
Premiums and for expenditures for Capital Expenditures and FF&E for such fiscal
year.  The Budget shall identify and set forth the Borrower’s and the Leasehold
Holder’s best estimate, after due consideration, of all costs and expenses
contemplated to be necessary in the related budget year (and, as to projects
initiated or to be initiated in or prior to the budget year but not completed in
the budget year, the estimated cost and completion schedule) for capital
improvements and leasehold improvements not included in the Budget, and the
contemplated sources of payment of the same. The Budget shall be subject to
Administrative Agent’s reasonable approval, and upon such approval shall, with
any amendments thereto approved by Administrative Agent from time to time,
constitute the “Approved Budget” hereunder; provided that Borrower shall not be
required to obtain Administrative Agent’s approval for additional expenditures
which (a) will cause the total expenses in the then-current Approved Budget to
be exceeded by less than five percent (5%), or (b) will cause the total expenses
for any individual line item on the then-current Approved Budget to be exceeded
by less than seven percent (7%). If a proposed Budget is not in form and
substance reasonably satisfactory to Administrative Agent, Administrative Agent
may disapprove the same and specify the reasons therefor, and Borrower shall
promptly amend and resubmit for approval a revised Budget, making such changes
as are necessary to comply with the reasonable requirements of Administrative
Agent; provided that until such time as Borrower has resubmitted the revised
Budget and Administrative Agent has approved such revised Budget, the parties
shall operate under the provisions of this Section 5.1(5) using the Budget
submitted to Administrative Agent as proposed to be revised by Administrative
Agent.

 

(6)           Default Notices.  As soon as practicable, and in any event within
five Business Days after a Responsible Officer of any Borrower Party has
Knowledge of the existence of any Potential Default, Event of Default, default
under the Ground Lease, any of the Management Agreements or the Option
Agreement, or other event having had a Material

 

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Adverse Effect or a Property Material Adverse Effect, the Borrower shall give
the Administrative Agent notice specifying the nature of such Potential Default
or Event of Default, default or other event, including the anticipated effect
thereof, which notice, if given by telephone, shall be promptly confirmed in
writing on the next Business Day.

 

(7)           Notice of Litigation.  Promptly after the commencement thereof,
the Borrower shall give the Administrative Agent written notice of the
commencement of all actions, suits and proceedings before any domestic or
foreign Governmental Authority or arbitrator, affecting the Borrower, Leasehold
Holder, Recourse Guarantor, Pledgor or any Manager, or affecting the Ground
Lease, Ground Lease Parcel, the Option Agreement or the Option Parcels that, in
the reasonable judgment of the Borrower, expose the Borrower or Leasehold
Holder, Recourse Guarantor, Pledgor or any Manager to liability which, if
adversely determined could reasonably be expected to have a Material Adverse
Effect or a Property Material Adverse Effect.

 

(8)           ERISA Matters.  The Borrower shall furnish the Administrative
Agent the following:

 

(i)            promptly and in any event within ten (10) days after any Borrower
Party knows or has reason to know that any ERISA Event reasonably likely to
result in a liability of the Borrower or of the Leasehold Holder in excess of
$1,000,000 has occurred, a written statement of a Responsible Officer of the
Borrower describing such ERISA Event and the action, if any, that the Borrower,
and its ERISA Affiliates propose to take with respect thereto and a copy of any
notice filed by the Borrower, the Leasehold Holder or any ERISA Affiliate with
the PBGC or the IRS pertaining thereto; and

 

(ii)           promptly following any request therefor, copies of (A) each
Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed
by the Borrower, the Leasehold Holder or any ERISA Affiliate with the Internal
Revenue Service with respect to each Title IV Plan, or, in lieu thereof, a
certificate of a Responsible Officer of the Borrower or Leasehold Holder stating
that Borrower or Leasehold Holder, as applicable, had no employees for the year
in question; (B) the most recent actuarial valuation report for each Title IV
Plan; (C) all notices received by the Borrower, Leasehold Holder or any ERISA
Affiliate from a Multiemployer Plan sponsor or any governmental agency
concerning an ERISA Event; and (D) such other documents or governmental reports
or filings relating to any Title IV Plan (or employee benefit plan sponsored or
contributed to by the Borrower or any ERISA Affiliate) as the Administrative
Agent shall reasonably request.

 

(9)           Environmental Matters.  The Borrower shall provide to the
Administrative Agent promptly (and in any event within 10 Business Days):
(i) any Hazardous Material Claims Known to the Borrower or Leasehold Holder (not
listed on Schedule 4.15 hereto) which would be reasonably expected to have a
Property Material Adverse Effect or affect the Mortgaged Property or the Option
Parcels; (ii) the receipt of any credible written notice of any alleged
violation of Hazardous Materials Laws with respect to the Mortgaged Property or,
to the extent Known to the Borrower or Leasehold Holder, the Option Parcels
provided that such alleged violation, if true (and if any release of the
Hazardous Materials alleged therein were not promptly remediated), would
reasonably be

 

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expected to result in a breach of Sections 5.10(1) or (2); and (iii) the
discovery of any occurrence or condition on the Mortgaged Property or, to the
extent Known to the Borrower or Leasehold Holder, the Option Parcels that would
reasonably be expected to cause the Borrower or either Leasehold Holder to be in
breach of Section 5.10(1) or, if not promptly remediated, of Section 5.10(2).

 

(10)         Appraisals.

 

(i)            If, in their sole and absolute discretion, Agents shall determine
that there has been a deterioration in the market value of a Real Property,
Agents may update any Appraisal, or obtain a new Appraisal, from time to time;
provided,  however, that unless an Event of Default shall have occurred and be
continuing at the time such Appraisals are undertaken, Borrower shall not be
liable for the expense of any new Appraisals.

 

(ii)           The Administrative Agent may, with reasonable prior written
notice (not to exceed three (3) Business Days) to the Borrower and, after and
during the continuance of an Event of Default, make physical verifications of
the Collateral in any manner and through any medium that the Administrative
Agent considers advisable, and the Borrower and the Leasehold Holder shall
furnish (or cause to be furnished) all such assistance and information as the
Administrative Agent may require in connection therewith.

 

(11)         Gaming Information.  Upon request by the Administrative Agent, with
respect to the current reporting period, the Loan Parties shall deliver to
Administrative Agent (i) within fifteen (15) days after filing thereof, copies
of the reports required under Regulation 6.080 of Nevada Gaming Commission
Regulation 6 (Accounting Regulations) and copies of the NGC-1 and NGC-17 reports
required by the Nevada Gaming Commission, and (ii) promptly after the receipt
thereof, copies of any written communication to Borrower, Leasehold Holder or
any Manager from any Gaming Authority advising it of a material violation of or
material non-compliance with any Gaming Law by Borrower or Leasehold Holder.

 

(12)         Management Fees. Upon request by the Administrative Agent, the Loan
Parties shall deliver to Administrative Agent promptly after receipt thereof, a
copy of each report delivered by any Manager to the Borrower or Leasehold Holder
pursuant to any Management Agreement with respect to the calculation of the
Management Fees (as defined in the applicable Management Agreement) or any other
fees payable to any Manager pursuant to any Management Agreement;

 

(13)         Other Information.  The Loan Parties will provide (or cause to be
provided) the Administrative Agent or any Lender with such other information
respecting the business, properties, condition, financial or otherwise, or
operations of the Borrower and/or of the Leasehold Holder and/ or of Holdco as
the Administrative Agent or any Lender through the Administrative Agent may from
time to time reasonably request, including, without limitation, a schedule of
the leasing activity at the Wild Wild West Assemblage during such period as such
Lender or Administrative Agent shall specify.

 

5.2           Maintenance of Existence and Rights.  The Borrower Parties shall
do or cause to

 

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be done all things necessary to (1) preserve, renew and keep in full force and
effect such Person’s existence, rights, licenses, permits and franchises
necessary to comply with all Requirements of Law applicable to them and the
Mortgaged Property, except to the extent permitted in Section 6.3; and
(2) remain qualified to do business and maintain its good standing in each
jurisdiction in which failure to be so qualified and in good standing would
reasonably be expected to have a Material Adverse Effect.

 

5.3           Compliance with Laws; Forfeiture.  Subject to any Good Faith
Contest, each of the Borrower Parties shall comply and cause the Mortgaged
Property to be in material compliance with all material Requirements of Law
applicable to the Borrower Parties and the Mortgaged Property and the uses
permitted upon the Mortgaged Property.  There shall never be committed by the
Borrower Parties, and the Borrower Parties shall not knowingly permit, any other
Person in occupancy of or involved with the operation or use of the Mortgaged
Property to commit, any act or omission affording the federal government or any
state or local government the right of forfeiture as against the Mortgaged
Property or any part thereof or any monies paid in performance of the Loan
Parties’ obligations under any of the Loan Documents.  Borrower hereby covenants
and agrees not to commit, knowingly permit, consent to or suffer to exist any
act or omission affording such right of forfeiture.

 

5.4           Access.  Borrower and the Leasehold Holder shall from time to time
permit (or cause to be permitted) the Administrative Agent and the Lenders, or
any agents or representatives thereof, promptly after written notification of
the same (except that during the continuance of an Event of Default, no such
notice shall be required) to (1) subject to applicable Gaming Laws, examine and
make copies of and abstracts from the records and books of account of the
Borrower or of the Leasehold Holder, (2) subject to any applicable Gaming Laws,
visit the Properties of the Borrower or of the Leasehold Holder and make
physical inspections of the Mortgaged Properties (in any manner and through any
medium that Administrative Agent considers advisable, and the Borrower and the
Leasehold Holder shall furnish all such assistance and information as the
Administrative Agent may require in connection therewith), (3) discuss the
affairs, finances and accounts of the Borrower or of the Leasehold Holder with
their respective officers, directors, managers, managing members and/or the
officers and directors thereof, and (4) communicate directly with any of the
Borrower’s or of the Leasehold Holder’s certified public accountants.  The
Borrower shall authorize such independent certified public accountants to
disclose to the Administrative Agent or any Lender during the continuance of an
Event of Default any and all financial statements and other information of any
kind, as the Administrative Agent or any Lender reasonably requests from the
Borrower or Leasehold Holder and that such accountants may have with respect to
the business, financial condition, results of operations or other affairs of the
Borrower and/or Leasehold Holder.

 

5.5           Insurance; Casualty; Condemnation; Restoration.

 

(1)           Insurance.  Borrower and the Leasehold Holder shall, at their sole
cost and expense, keep in full force and effect insurance coverage of the types
and minimum limits as set forth in Schedule 5.5 and any additional insurance
required under the Ground Lease and the Management Agreements. Subject to clause
(7) below, such coverage may be pursuant to an umbrella insurance policy
maintained by PropCo, so long as sublimits for each Mortgaged Property meet all
requirements of this Section 5.5 and such umbrella insurance policy is in form

 

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and substance reasonably satisfactory to the Administrative Agent.

 

(2)           Insurance Proceeds.

 

(i)       If any portion of the Mortgaged Property is damaged or destroyed, in
whole or in part, by a Material Casualty (as defined below), the Borrower or the
Leasehold Holder shall give prompt written notice thereof to the Administrative
Agent, generally describing the nature and extent of such Casualty.  Following
the occurrence of a Casualty, unless the Administrative Agent has made an
election under Section 5.5(4) and pursuant thereto applied the Proceeds to pay
the Obligations, the Loan Parties shall in a reasonably prompt manner either
(x) use (or direct the use of) the Proceeds to pay the Obligations or (y) apply
(or cause to be applied) the Proceeds in accordance with Section 5.5(3).

 

(ii)      Subject to clause (v) below, and to any requirements and restrictions
set forth in the Ground Lease with respect to the Ground Lease Parcel, in the
event of a Casualty where the loss does not exceed $2,500,000, the Borrower or
the Leasehold Holder, as applicable, may settle and adjust such claim without
the consent of the Administrative Agent; provided that such adjustment is
carried out in a competent and timely manner. In such case, the Borrower or the
Leasehold Holder, as applicable, is hereby authorized to collect and receive any
Proceeds.

 

(iii)     Subject to clause (v) below, and to any requirements and restrictions
set forth in the Ground Lease with respect to the Ground Lease Parcel, in the
event of a Casualty where the loss exceeds $2,500,000 (a “Material Casualty”),
the Borrower or the Leasehold Holder, as applicable, may settle and adjust such
claim only with the consent of the Administrative Agent (which consent shall not
be unreasonably withheld or delayed) and the Administrative Agent shall have the
opportunity to participate in any such adjustments.

 

(iv)     Subject to any requirements and restrictions set forth in the Ground
Lease with respect to the Ground Lease Parcel, the proceeds of any Policy in
excess of $2,500,000 shall be due and payable jointly to the Administrative
Agent and the Borrower (or the Leasehold Holder) as their interests may appear
and held and applied in accordance with the terms hereof, with Administrative
Agent to be shown as Mortgagee and Loss Payee on all Property Insurance.

 

(v)      Notwithstanding the terms of clauses (i) through (iv) above, the
Administrative Agent shall have the sole authority to collect all Proceeds if an
Event of Default shall have occurred and is continuing.

 

(3)           Right to Apply to Restoration. In the event of (1) a Casualty that
does not constitute a Material Casualty, or (2) a Condemnation that does not
constitute a Material Condemnation, the Administrative Agent shall (subject to
any requirements and restrictions set forth in the Ground Lease with respect to
the Ground Lease Parcel affected by such Casualty or Condemnation) permit the
application of the Proceeds (after reimbursement of any reasonable out-of-pocket
expenses actually incurred by the Administrative Agent) to reimburse the
Borrower or the Leasehold Holder, as applicable, for the cost of restoring,
repairing, replacing or

 

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rebuilding or otherwise curing title defects at the Mortgaged Property (the
“Restoration”), in the manner required hereby, provided and on the condition
that (y) no Event of Default shall have occurred and be then continuing and
(z) in the reasonable judgment of the Administrative Agent:

 

(i)       the Mortgaged Property, after such Restoration, will adequately secure
the outstanding balance of the Loans,

 

(ii)      the Restoration can be completed by the 90th day prior to the Maturity
Date, and

 

(iii)     with respect to any Ground Lease Parcel, the Ground Lease is and shall
at all times during the Restoration, and from and after the completion thereof,
remain in full force and effect, without default thereunder, and Borrower and/or
the Leasehold Holder shall have provided evidence to such effect reasonably
satisfactory to Administrative Agent, including, if Administrative Agent
requests, a written acknowledgement and agreement to such effect on the part of
the Ground Lease Fee Owner under the Ground Lease.

 

(4)           Material Casualty or Condemnation. In the event of a Material
Casualty or a Material Condemnation, then the Administrative Agent shall apply
the Proceeds therefrom in respect of the Obligations (subject to any
requirements and restrictions set forth in any Ground Lease with respect to the
Ground Lease Parcel affected by such Casualty or Condemnation).

 

(5)           Manner of Restoration and Reimbursement. If either the Borrower or
Leasehold Holder, as applicable, is entitled pursuant to Section 5.5(3) above to
reimbursement out of Proceeds (and the conditions specified therein shall have
been satisfied), such Proceeds shall be promptly disbursed by Administrative
Agent.

 

(6)           Condemnation.  Borrower or the Leasehold Holder shall promptly
notify, or cause to be notified, Administrative Agent of the actual or
threatened commencement of any proceeding for the Condemnation of any Mortgaged
Property of which any Borrower Party has Knowledge and deliver or cause to be
diligently delivered to Administrative Agent copies of any and all material
papers served in connection with such proceedings.  Administrative Agent may
participate in any such proceedings, and the Borrower or the Leasehold Holder
shall from time to time deliver (or cause to be delivered) to Administrative
Agent all instruments requested by Administrative Agent to permit such
participation.  Borrower or the Leasehold Holder shall, at its expense,
diligently prosecute or cause to be diligently prosecuted any such proceedings. 
Borrower or the Leasehold Holder may settle and compromise the Proceeds of any
Condemnation where the loss exceeds $2,500,000 (a “Material Condemnation”) only
with the consent of the Administrative Agent (which consent shall not be
unreasonably withheld or delayed) and subject to any requirements and
restrictions set forth in the Ground Lease with respect to the Ground Lease
Parcel affected by such Condemnation.  Borrower or the Leasehold Holder may
settle and compromise the Proceeds of any Condemnation that is not a Material
Condemnation without the consent of the Administrative Agent (subject to any
requirements and restrictions set forth in the Ground Lease with respect to the
Ground Lease Parcel affected by such Condemnation).  Notwithstanding any taking
by any public or quasi-public authority through

 

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Condemnation or otherwise (including but not limited to any transfer made in
lieu of or in anticipation of the exercise of such taking), the Borrower shall
continue to pay the Obligations at the time and in the manner provided for
herein and the other Loan Documents, and the Obligations shall not be reduced
unless and until any Proceeds shall have been actually received and applied by
Administrative Agent, after the deduction of expenses of collection, to the
reduction or discharge of the Obligations pursuant to the terms of
Section 5.5(3) or 5.5(4) above.  Administrative Agent shall not be limited to
the interest paid on such Proceeds by the condemning authority but shall be
entitled to receive out of such Proceeds interest at the rate or rates provided
herein applicable to the Loans.  To the extent the Proceeds of any Condemnation
are to be applied by Administrative Agent pursuant to Section 5.5(3) or
5.5(4) above, the Borrower or the Leasehold Holder shall cause such Proceeds to
be paid directly to the Administrative Agent to be held and applied pursuant to
such provisions.

 

(7)           Umbrella Policy Limitation. If PropCo is subject to a bankruptcy
or insolvency proceeding of the type described in Section 7.1(6), then the Loan
Parties shall, within forty-five (45) days after receipt of a written request
from the Administrative Agent, procure their own insurance required by this
Section 5.5, which insurance shall not be part of an umbrella insurance policy.

 

5.6           Books and Records.

 

The Loan Parties shall keep and maintain (or cause to be kept and maintained) on
a Fiscal Year basis proper books and records in which accurate and complete
entries shall be made of all dealings or transactions of or in relation to the
Loans, the Mortgaged Property, the Option Parcels and the business and affairs
of Loan Parties which shall reflect all items of income and expense in
connection with the operation of the Mortgaged Property and in connection with
any services, equipment or furnishings provided in connection with the operation
of the Mortgaged Property, in accordance with GAAP.

 

5.7           Maintenance of Mortgaged Property/Business Operations.

 

(a)           The Borrower shall keep and maintain, or cause to be kept and
maintained, the Borrower Mortgaged Property and every part thereof in not less
than its existing condition and repair, and Borrower shall, subject to ordinary
wear and tear, and, subject to the provisions of this Agreement with respect to
damage or destruction caused by a Casualty or Condemnation, shall from time to
time make, or cause to be made, all reasonably necessary repairs, renewals,
replacements, betterments and improvements to the Borrower Mortgaged Property
necessary to maintain such minimum condition and repair, and shall not permit or
commit any waste, impairment, or deterioration of any portion of the Borrower
Mortgaged Property in any material respect; provided, that it is acknowledged
that, with respect to one or more buildings comprising parts of the Wild Wild
West Fee Assemblage, Borrower may at some point in the future recommend that
such building or buildings be removed from active service and shut down for some
specified period of time in a safe manner designed to minimize deterioration
pursuant to a written inactive service program with respect to such building or
buildings, which program, and such removal from active service, if proposed by
Borrower, shall be subject to Administrative Agent’s written approval, and if so
proposed by Borrower and approved by Administrative Agent, then the standard of
maintenance and repair for such building or buildings shall be the

 

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standard approved by Administrative Agent under such inactive service plan,
rather than the foregoing standard.  The Borrower further covenants to do (or
cause to be done) all other acts which from the character or use of the Borrower
Mortgaged Property may be reasonably necessary to protect the security of the
Collateral Documents, the specific enumerations herein not excluding the
general.  Borrower shall continue to engage in the businesses presently
conducted by it and shall continue to operate the Borrower Mortgaged Property as
the Borrower Mortgaged Property is operated as of the Effective Date (subject in
the case of any buildings within the Wild Wild West Fee Assemblage that become
the subject of an inactive service plan approved by the Administrative Agent
pursuant to the proviso in the first sentence of this Section 5.7(a), to the
provisions of such proviso and such inactive service plan, if the same becomes
applicable).  Borrower shall (i) keep and maintain all Licenses necessary for
the operation of each Borrower Mortgaged Property, to the extent applicable, in
accordance with its current respective use, and (ii) at all times maintain,
preserve and protect all trade names where the failure to so maintain, preserve
and protect any such licenses or trade names, in each case would be reasonably
likely to have a Material Adverse Effect or a Property Material Adverse Effect
and preserve all of the remainder of its property used in and necessary for the
conduct of its business.  Borrower shall qualify to do business and shall remain
in good standing under the laws of the State in which the Borrower Mortgaged
Property is located as and to the extent required for the ownership,
maintenance, management and operation of the Borrower Mortgaged Property.

 

(b)           Leasehold Holder shall keep and maintain, or cause to be kept and
maintained, the Leasehold Holder Mortgaged Property and every part thereof in
not less than its existing condition and repair, and Borrower and Leasehold
Holder shall, subject to ordinary wear and tear, and, subject to the provisions
of this Agreement with respect to damage or destruction caused by a Casualty or
Condemnation, shall from time to time make, or cause to be made, all reasonably
necessary repairs, renewals, replacements, betterments and improvements to the
Leasehold Holder Mortgaged Property necessary to maintain such minimum condition
and repair, and shall not permit or commit any waste, impairment, or
deterioration of any portion of the Leasehold Holder Mortgaged Property in any
material respect.  The Leasehold Holder further covenants to do (or cause to be
done) all other acts which from the character or use of the Leasehold Holder
Mortgaged Property may be reasonably necessary to protect the security of the
Collateral Documents, the specific enumerations herein not excluding the
general.  Leasehold Holder shall continue to engage in the businesses presently
conducted by it and shall continue to operate the Leasehold Holder Mortgaged
Property as the Leasehold Holder Mortgaged Property is operated as of the
Effective Date.  Without limiting the foregoing, Leasehold Holder shall continue
to operate a hotel and casino on the Ground Lease Parcel in the Hotel/Casino
Facility.  Leasehold Holder shall (i) keep and maintain all Licenses necessary
for the operation of each Leasehold Holder Mortgaged Property (including,
without limitation, the operation of Hotel/Casino Facility as a hotel and casino
with unrestricted gaming activities therein), to the extent applicable, in
accordance with its current respective use, and (ii) at all times maintain,
preserve and protect all trade names owned by Leasehold Holder, in each case,
where the failure to so maintain, preserve and protect any such licenses or
trade names would be reasonably likely to have a Material Adverse Effect or a
Property Material Adverse Effect and preserve all of the remainder of its
property used in and necessary for the conduct of its business.  Leasehold
Holder shall qualify to do business and shall remain in good standing under the
laws of the State in which the Leasehold Holder Mortgaged Property is located as
and to the extent required for the ownership, maintenance, management and
operation of the Leasehold Holder Mortgaged

 

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Property.

 

5.8           Approved Leases.  Each of Borrower and Leasehold Holder agrees
that, without the prior written consent of Administrative Agent, it shall not
(a) enter into any Lease which is not an Approved Lease, (b) renew (other than
pursuant to renewal rights expressly set forth in such Approved Lease) or extend
any Approved Lease, (c) waive any provisions of any Approved Lease, provided
that subject to clause (b), a Loan Party shall have the right to waive (or cause
to be waived) provisions of such Approved Lease so long as the same would not
have the effect of either permitting such Loan Party to take an action that it
is prohibited from taking under any of the Loan Documents, or preventing such
Loan Party from complying with its respective obligations under any of the Loan
Documents, or (d) amend or modify in any respect any Lease: (i) in a manner
adverse to Administrative Agent, (ii) so as to increase Borrower’s or Leasehold
Holder’s obligations thereunder or materially reduce the obligations of the
tenant thereunder, or (iii) so as to result in the Lease being on terms and
conditions or for Rents that are not market Rents.

 

5.9           Taxes.

 

(1)           The Borrower Parties shall file all Tax Returns required to be
filed in any jurisdiction and, if applicable, and except with respect to Taxes
subject to any Good Faith Contest, pay and discharge all Taxes imposed upon it
or its Property or in respect of any of its franchises, business, income or
property before any material penalty shall be incurred with respect to such
Taxes.

 

(2)           The Borrower and Leasehold Holder shall pay (or cause to be paid),
subject to the right to pursue a Good Faith Contest, all Impositions now or
hereafter levied or assessed or imposed against the Mortgaged Property or any
part thereof prior to the imposition of any interest, charges or expenses for
the non-payment thereof and shall pay all Other Charges on or before the date
they are due.  Subject to a Loan Party’s right to pursue a Good Faith Contest,
the Administrative Agent, on behalf of the Borrower or of the Leasehold Holder,
may pay, but shall not be obligated to pay, any delinquent Impositions and Other
Charges which are attributable to or affect the Mortgaged Property or the
Borrower or of the Leasehold Holder directly to the applicable taxing authority
with respect thereto, and the Borrower agrees to reimburse (or cause to be
reimbursed) the Administrative Agent for such payments promptly on demand.

 

5.10         Environmental.

 

The Borrower and Leasehold Holder shall:

 

(1)           cause the Mortgaged Property to, comply with all Hazardous
Materials Laws, except for any such non-compliance that would not reasonably be
expected to have a Property Material Adverse Effect.  If the Security
Instruments are foreclosed, Borrower and the Leasehold Holder shall deliver (or
cause to be delivered) the Mortgaged Property in material compliance with all
applicable Hazardous Materials Laws.

 

(2)           if at any time during the continuance of the Lien of the Security
Instruments, a Governmental Authority having jurisdiction over the Mortgaged
Property

 

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requires, in writing, remedial action to correct the presence of Hazardous
Materials in, around, or under the Mortgaged Property or, to the extent of any
Loan Party’s Knowledge, the Option Parcels (an “Environmental Event”), deliver
(or cause to be delivered) prompt notice of the occurrence of such Environmental
Event to Administrative Agent.  Within thirty (30) days after any Loan Party has
Knowledge of the occurrence of an Environmental Event, Borrower shall deliver
(or cause to be delivered) to Administrative Agent an Officer’s Certificate (an
“Environmental Certificate”) explaining the Environmental Event in reasonable
detail and setting forth the proposed remedial action, if any.

 

(3)           promptly cause the removal of any Hazardous Materials discharged,
disposed of, or otherwise released in, on or under the Mortgaged Property that
are in material violation of any Hazardous Materials Laws, and cause any
remediation required by any Hazardous Material Laws or Governmental Authority to
be performed, though no such action shall be required if any action is subject
to a Good Faith Contest.  In the course of carrying out such actions, the
Borrower or the Leasehold Holder shall provide (or caused to be provided) the
Administrative Agent with such periodic information and notices regarding the
status of investigation, removal, and remediation, as the Administrative Agent
may reasonably require.

 

(4)           diligently complete (or cause to be completed) (a) the on-going
remedial investigation with respect to the portion of the Mortgaged Property
commonly known as 3680 West Tropicana Avenue, Las Vegas, Nevada and identified
by Clark County Assessor’s Parcel Number 162-20-401-009 (the “GVG Parcel”) to
the satisfaction of the applicable Governmental Authority, or Governmental
Authorities, with jurisdiction over the GVG Parcel, and to the reasonable
satisfaction of the Agents, and (b) any remedial or response actions required by
the applicable Governmental Authority, or Governmental Authorities, with
jurisdiction over the GVG Parcel, related to the presence of Hazardous Materials
in, at, under, around or emanating from the GVG Parcel to the satisfaction of
such applicable Governmental Authority, or Governmental Authorities and to the
reasonable satisfaction of the Agents.  Borrower shall obtain (or cause to be
obtained) a “no further action” letter or equivalent documentation issued by the
applicable Governmental Authority, or Governmental Authorities, with
jurisdiction over the GVG Parcel, stating that such remedial investigation and
any required remedial or response actions have been completed to the
satisfaction of such applicable Governmental Authority, or Governmental
Authorities, and shall provide a copy of such documentation to the Agents.

 

(5)           diligently complete (or cause to be completed) (a) the on-going
remedial investigation with respect to the portion of the Mortgaged Property
commonly known as 4575 Procyon Street, Las Vegas, Nevada and identified by Clark
County Assessor’s Parcel Number 162-20-301-012 (the “RDC Parcel”) to the
satisfaction of the applicable Governmental Authority, or Governmental
Authorities, with jurisdiction over the RDC Parcel, and to the reasonable
satisfaction of the Agents, and (b) any remedial or response actions required by
the applicable Governmental Authority, or Governmental Authorities, with
jurisdiction over the RDC Parcel, related to the presence of Hazardous Materials
in, at, under, around or emanating from the RDC Parcel to the satisfaction of
such applicable Governmental Authority, or Governmental Authorities, and to the
reasonable satisfaction of the Agents.  Borrower shall obtain (or cause to be
obtained) a “no further action” letter or equivalent documentation issued by the
applicable Governmental Authority, or Governmental

 

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Authorities, with jurisdiction over the RDC Parcel, stating that such remedial
investigation and any required remedial or response actions have been completed
to the satisfaction of such applicable Governmental Authority, or Governmental
Authorities, and shall provide a copy of such documentation to the Agents.

 

5.11         Title to the Mortgaged Property.  Each Loan Party shall warrant and
defend (1) its fee and, as to the Ground Lease Parcel, leasehold, title to the
Mortgaged Property and every part thereof, subject only to Liens permitted
hereunder (including Permitted Encumbrances), and (2) the validity and priority
of the Liens of the Security Instruments on the Mortgaged Property, subject only
to Liens permitted hereunder (including applicable Permitted Encumbrances), in
each case against the claims of all Persons whomsoever.

 

5.12         Interest Rate Contracts.

 

(1)           Required Interest Rate Contracts.  In connection with the exercise
of each of Borrower’s Options to Extend, Borrower shall enter into, no later
than the dates set forth in Section 2.3(b) above, and thereafter maintain in
effect the Required Interest Rate Contracts, with reduction to reflect
prepayments of principal amounts of the Loans, through and including the
Maturity Date.

 

(2)           Pledge and Collateral Assignment. In connection with the exercise
of each of Borrower’s Options to Extend and each Required Interest Rate Contract
entered into in connection therewith, Borrower shall enter into an Assignment of
Interest Rate Contract with respect to each Required Interest Rate Contract
which assignment pledges, assigns, transfers, delivers and grants a continuing
first priority lien to the Administrative Agent, as security for payment of all
sums due in respect of the Loans and the performance of all other terms,
conditions and covenants of this Agreement and any other Loan Document on the
Borrower’s part to be paid and performed, in, to and under all of such
Borrower’s right, title and interest whether now owned or hereafter acquired and
whether now existing or hereafter arising: (i) in the Required Interest Rate
Contract; (ii) to receive any and all payments under the Required Interest Rate
Contract, whether as contractual obligations, damages or otherwise; and (iii) to
all claims, rights, powers, privileges, authority, options, security interests,
liens and remedies, if any, under or arising out of the Required Interest Rate
Contract, in each case including all accessions and additions to, substitutions
for and replacements, products and proceeds of any of the foregoing
(collectively, the “Rate Contract Collateral”).  The Borrower shall notify the
counterparty under the Required Interest Rate Contract of such assignment. The
Borrower shall not, without obtaining the prior written consent of the
Administrative Agent, further pledge, transfer, deliver, assign or grant any
security interest in any Required Interest Rate Contract or any of the other
Rate Contract Collateral or permit any Lien or encumbrance to attach thereto, or
any levy to be made thereon, or any UCC-1 Financing Statements or any other
notice or instrument as may be required under the UCC, as appropriate, except
those naming the Administrative Agent as the secured party, to be filed with
respect thereto.

 

(3)           Covenants.

 

(i)            The Borrower shall comply with all of its obligations under the

 

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terms and provisions of the Required Interest Rate Contracts.  All amounts paid
by the counterparty under the Required Interest Rate Contracts to the Borrower
shall be promptly deposited into an Account subject to a Control Agreement. The
Borrower shall take all actions reasonably requested by the Administrative Agent
to enforce the Borrower’s rights under the Required Interest Rate Contracts in
the event of a default by the counterparty thereunder and shall not waive or
otherwise Modify any of its rights thereunder.

 

(ii)           If Deutsche Bank, JPMorgan or an Affiliate thereof is not the
Counterparty, in the event of (A) any downgrade, withdrawal or qualification
(each, a “Downgrade”) of the rating of any Counterparty to a Required Interest
Rate Contract such that, thereafter, such Counterparty shall cease to be an
Acceptable Counterparty or (B) any Counterparty shall fail to comply with the
requirements contained in the Required Interest Rate Contract, upon such
occurrence, the Borrower shall replace such Required Interest Rate Contract with
a replacement Interest Rate Contract satisfying all the requirements of the
replaced Required Interest Rate Contract hereunder and otherwise acceptable to
the Administrative Agent (and such replacement Interest Rate Contract shall be a
Required Interest Rate Contract).

 

(iii)          Except as permitted by Section 5.12(2), the Borrower shall not
(A) without the prior written consent of the Administrative Agent, Modify the
terms of any Required Interest Rate Contract, (B) without the prior written
consent of the Administrative Agent, cause the termination of any Required
Interest Rate Contract prior to its stated maturity date, (C) without the prior
written consent of the Administrative Agent, except as aforesaid, waive or
release any obligation of any Counterparty (or any successor or substitute party
to a Required Interest Rate Contract) under a Required Interest Rate Contract,
(D) without the prior written consent of the Administrative Agent, consent or
agree to any act or omission to act on the part of any Counterparty (or any
successor or substitute party to a Required Interest Rate Contract) which,
without such consent or agreement, would constitute a default under such
Required Interest Rate Contract, (E) fail to exercise promptly and diligently
each and every material right which it may have under any Required Interest Rate
Contract, (F) take or intentionally omit to take any action or intentionally
suffer or permit any action to be omitted or taken, the taking or omission of
which would result in any right of offset against sums payable under any
Required Interest Rate Contract or any defense by any Counterparty (or any
successor or substitute party to a Required Interest Rate Contract) to payment
or (G) fail to give prompt notice to the Administrative Agent of any notice of
default given by or to the Borrower under or with respect to any Required
Interest Rate Contract, together with a complete copy of such notice.

 

5.13         Single Purpose Entities.   Each of Borrower and Leasehold Holder
shall maintain itself as a Single Purpose Entity and Borrower shall cause Holdco
to maintain itself as a Single Purpose Entity.

 

5.14         Franchise Agreement.

 

(1)           Neither Borrower nor Leasehold Holder shall (x) terminate any
Franchise Agreement if any such termination would result in the payment of any
termination or similar fee paid by Borrower or Leasehold Holder and such payment
would give rise to a Material Adverse

 

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Effect, (y) amend or modify any Franchise Agreement if any such amendment or
modification would result in the payment of any fee or penalty paid by Borrower
or Leaseholder or materially increase Borrower’s or Leasehold Holder’s
obligations or liabilities under the Franchise Agreement or materially reduce
the benefits to be received by Borrower or Leasehold Holder under the Franchise
Agreement or result in a Material Adverse Effect or a Property Material Adverse
Effect, or (z) enter into any Franchise Agreement with any other party, in each
case, without Administrative Agent’s prior written consent, which consent may be
withheld in Administrative Agent’s sole and absolute discretion; and

 

(2)           Borrower and Leasehold Holder shall promptly deliver to
Administrative Agent a copy of each material notice and material report received
or delivered by it under the Franchise Agreement.

 

5.15         Entitlements.  Borrower and Leasehold Holder shall, subject to the
obligations contained in the Ground Lease,  use their reasonable commercial
efforts to prosecute to completion all pending entitlements necessary to develop
the Ground Lease Parcel as a hotel-casino.   Borrower shall maintain and take
all commercially reasonable actions necessary to maintain all entitlements
currently in place related to the development of the Cactus Assemblage and the
Wild Wild West Fee Assemblage.

 

5.16         Further Assurances.

 

(1)           The Borrower Parties shall promptly upon request by the
Administrative Agent or any Lender, do any acts or, execute, acknowledge,
deliver, record, re-record, file, re-file, register and re-register, any and all
such further deeds, conveyances, security agreements, mortgages, assignments,
estoppel certificates, financing statements and continuations thereof,
termination statements, notices of assignment, transfers, certificates,
assurances and other instruments the Administrative Agent or such Lender, as the
case may be, may reasonably require from time to time in order (i) to carry out
more effectively the purposes of this Agreement or any other Loan Document, and
(ii) to assure, convey, grant, assign, transfer, preserve, protect and confirm
to the Administrative Agent and Lenders the rights granted or now or hereafter
intended to be granted to the Lenders under any Loan Document or under any other
document executed in connection therewith.

 

(2)           Borrower agrees that it shall, upon request and at no cost to
Borrower, reasonably cooperate with Administrative Agent or any Lender in
connection with any request by Administrative Agent or Lender to sever the Note
into two (2) or more separate substitute notes in an aggregate principal amount
equal to the principal amount of the original Note and to reapportion the Loans
among such separate substitute notes, including, without limitation, by
executing and delivering to Administrative Agent or such Lender new substitute
notes to replace the Note, amendments to or replacements of existing Loan
Documents to reflect such severance and/or opinions of counsel with respect to
such substitute notes, amendments and/or replacements, provided that Borrower
shall bear no costs or expenses in connection therewith (other than internal
administrative costs and expenses of Borrower).  Any such substitute notes may
have varying principal amounts and economic terms, provided, however, that
(i) the maturity date of any such substitute note shall be the same as the
Maturity Date, (ii) the initial weighted average interest rate for the term of
the substitute notes shall not exceed the

 

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interest rate under the Note being substituted immediately prior to the issuance
of such substitute notes; and (iii) the economics of the Loans shall not change
in a manner which is adverse to Borrower.  Upon the occurrence and during the
continuance of an Event of Default, Administrative Agent may apply payment of
all sums due under such substitute notes (and in respect of any other
Obligations) in such order and priority as Administrative Agent shall elect in
its sole and absolute discretion.

 

(3)           Administrative Agent will take such action as may be reasonably
required in order to permit the filing of plats, maps, records of survey or
other documents necessary for the development of improvements on the Mortgaged
Property to the extent required by any applicable Governmental Authority and
otherwise permitted under the terms of this Agreement.

 

5.17         Intentionally Omitted.

 

5.18         Ground Lease Covenants.

 

(1)           Waiver of Interest In New Ground Lease.  In the event the Ground
Lease shall be terminated by reason of a default thereunder by the Leasehold
Holder and Administrative Agent shall require that the Ground Lease Fee Owner
enter into a new ground lease, each Loan Party shall, if Administrative Agent so
requires, waive any right, title and interest in and to such new ground lease or
the leasehold estate created thereby, waiving all rights of redemption now or
hereafter operable under any law, to the extent permitted by applicable law.

 

(2)           No Election to Terminate.  No Loan Party shall permit, acquiesce
or elect to treat any Ground Lease as terminated, canceled or surrendered
pursuant to the applicable provisions of the Bankruptcy Code (including, without
limitation, Section 365(h)(1) thereof) without Administrative Agent’s prior
written consent in the event a bankruptcy of the Ground Lease Fee Owner or any
other party to the Ground Lease.  In addition, to the extent not prohibited by
applicable law, in the event of a bankruptcy of the Ground Lease Fee Owner or
any other party to any Ground Lease, the Leasehold Holder shall promptly
reaffirm and ratify the legality, validity, binding effect and enforceability of
the Ground Lease and remain in possession of the Ground Lease Parcel, the
related Leasehold Estate and the other rights granted pursuant to the Ground
Lease, notwithstanding any rejection thereof by the Ground Lease Fee Owner, any
other party to the Ground Lease, or any trustee, custodian or receiver.

 

(3)           Notice Prior to Rejection.  Borrower (or the Leasehold Holder)
shall give Administrative Agent not less than thirty (30) days prior written
notice of the date on which Leasehold Holder shall apply to any court or other
Governmental Authority for authority and permission to reject any Ground Lease
in the event that there shall be filed by or against Leasehold Holder any
petition, action or proceeding under the Bankruptcy Code or under any other
similar federal or state law now or hereafter in effect and if Leasehold Holder
determines to reject the Ground Lease.  Lender shall have the right, but not the
obligation, to serve upon Leasehold Holder within such thirty (30) day period a
notice stating that (i) Administrative Agent demands that Leasehold Holder
assume and assign the Ground Lease to

 

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Administrative Agent (or its designee) subject to and in accordance with the
Bankruptcy Code, and (ii) Administrative Agent covenants to cure or provide
reasonably adequate assurance thereof with respect to all defaults reasonably
susceptible of being cured by Lender and of future performance under the Ground
Lease.  If Administrative Agent serves upon Leasehold Holder the notice
described above, Leasehold Holder shall not reject the Ground Lease and shall
comply with the demand provided for in clause (i) above within fifteen (15) days
after the notice shall have been given by Administrative Agent.

 

(4)           Administrative Agent Right to Perform.  During the continuance of
an Event of Default, each Loan Party acknowledges and consents that
Administrative Agent shall have the right, but not the obligation, (i) to
perform and comply with all obligations of the Leasehold Holder under the Ground
Lease without relying on any grace period provided therein, (ii) to do and take,
without any obligation to do so, such actions as Administrative Agent deems
necessary or desirable to prevent or cure any default by the Leasehold Holder
under the Ground Lease, including, without limitation, any act, deed, matter or
thing whatsoever that the Leasehold Holder may do in order to cure a default
under the Ground Lease and (iii) subject to the terms of the Ground Lease, to
enter in and upon any of the Ground Lease Parcel or any part thereof to such
extent and as often as Administrative Agent deems necessary or desirable,
subject to applicable Gaming Laws, in order to prevent or cure any default of
the Leasehold Holder under the Ground Lease.  The Leasehold Holder shall, within
five (5) Business Days after written request is made therefor by Administrative
Agent execute and deliver to Administrative Agent or to any party designated by
Administrative Agent, such further instruments, agreements, powers, assignments,
conveyances or the like as may be reasonably necessary to complete or perfect
the interest, rights or powers of Administrative Agent pursuant to this
Section or as may otherwise be required by Administrative Agent.

 

(5)           Attorney in Fact.  In the event of any arbitration under or
pursuant to the Ground Lease in which Administrative Agent elects to
participate, each Loan Party hereby acknowledges and consents that
Administrative Agent shall be irrevocably appointed as the Leasehold Holder’s
true and lawful attorney-in-fact (which appointment shall be deemed coupled with
an interest) to exercise, during the continuance of an Event of Default, all
right, title and interest of Leasehold Holder in connection with such
arbitration, including, without limitation, the right to appoint arbitrators and
to conduct arbitration proceedings on behalf of Leasehold Holder and
Administrative Agent.  All reasonable out-of-pocket costs and expenses incurred
by Administrative Agent (and any Lenders) in connection with such arbitration
and the settlement thereof shall be borne solely by Borrower and the Leasehold
Holder, including, without limitation, reasonable attorneys’ fees and
disbursements.  Nothing contained in this Section shall obligate Administrative
Agent to participate in any such arbitration.

 

(6)           Payment of Sums Due Under Ground Lease.  The Leasehold Holder
shall pay all rent, additional rent, common charges, common area maintenance
charges and other charges or assessments reserved in or payable under the Ground
Lease on or prior to the due date thereof.

 

(7)           Performance of Covenants.  The Leasehold Holder shall (i) promptly
perform and observe in all material respects all of the terms, covenants and
conditions

 

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required to be performed and observed by the Leasehold Holder under the Ground
Lease, the breach of which could permit any party to the Ground Lease validly to
terminate the Ground Lease (including, without limitation, all payment
obligations), (ii) do all things commercially reasonable to preserve and to keep
unimpaired its rights under the Ground Lease, (iii) not waive, excuse or
discharge any of the material obligations of the Ground Lease Fee Owner or any
other party to the Ground Lease without Administrative Agent’s prior written
consent in each instance, and (iv) diligently and continuously enforce the
material obligations of the Ground Lease Fee Owner and the other parties to the
Ground Lease except in any such case where same would not have a Material
Adverse Effect or a Property Material Adverse Effect.

 

(8)           No Modification or Termination.

 

(i)            No Loan Party shall, except as permitted hereunder or with the
prior written consent of Administrative Agent, permit, consent to or acquiesce
in any Modification to the Ground Lease that is adverse to the Lenders, it being
agreed that any such Modification that changes the term, affects the rent amount
or other payments due under the Ground Lease, affects or relates to any option
or right to purchase all or any portion of the Ground Lease Parcel, affects the
rights of Administrative Agent or the Lenders under the Ground Lease, or
otherwise increases Borrower’s or Leasehold Holder’s obligations or liabilities
under the Ground Lease and/or that reduces the benefits to be received by
Borrower or Leasehold Holder under the Ground Lease shall be deemed to be
adverse to the Lenders.

 

(ii)           No Loan Party shall cancel, terminate or surrender the Ground
Lease or permit, consent to or acquiesce in any cancellation, termination or
surrender of the Ground Lease, without in each case the prior written consent of
Administrative Agent.  Any agreement to which Borrower, the Leasehold Holder or
any Affiliate is a party whereby any part of the Ground Lease is terminated or
the Ground Lease Parcel is withdrawn therefrom in violation of the immediately
preceding sentence shall constitute a Disposition prohibited under this
Agreement.

 

(9)           Notices of Default.  Borrower or the Leasehold Holder shall
promptly (but in no event later than three (3) Business Days after Borrower’s or
the Leasehold Holder’s receipt thereof) deliver (or cause to be delivered) to
Administrative Agent copies of any written notice of default by any party under
the Ground Lease, or of any written notice from Ground Lease Fee Owner or any
other party to the Ground Lease of its intention to terminate the Ground Lease
or to re-enter and take possession of any portion of the Ground Lease Parcel or
any improvements or personalty located thereon.

 

(10)         Delivery of Information.  Borrower or the Leasehold Holder shall
promptly furnish (or cause to be furnished) to Administrative Agent copies of
such information and evidence as Administrative Agent may reasonably request
concerning Leasehold Holder’s due observance, performance and compliance with
the terms, covenants and conditions of the Ground Lease.

 

(11)         No Subordination.  No Loan Party shall permit, consent to or
acquiesce to the subordination of the Ground Lease to any mortgage or other
lease of the fee interest in any portion of the Ground Lease Parcel or any
improvements or personalty located thereon,

 

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other than the Security Instruments.

 

(12)         Further Assurances.  The Loan Parties shall, at their sole cost and
expense, execute and deliver to Administrative Agent, within five (5) Business
Days after request, such documents, instruments or agreements as may be
reasonably required to permit Administrative Agent to cure any default under the
Ground Lease.

 

(13)         Estoppel Certificates.  With respect to the Ground Lease, the Loan
Parties shall use commercially reasonable efforts to obtain and deliver to
Administrative Agent within thirty (30) days after written demand by
Administrative Agent, an estoppel certificate, in form and substance acceptable
to Administrative Agent, from the Ground Lease Fee Owner and other parties to
the Ground Lease designated by Administrative Agent setting forth, among other
things, (i) the name of the parties thereunder, (ii) that the Ground Lease is in
full force and effect and has not been modified or, if it has been modified, the
date of each modification (together with copies of each such modification),
(iii) the date to which all rent, additional rent, common charges, common area
maintenance charges and other charges or assessments reserved in or payable
under the Ground Lease have been paid thereunder, (iv) whether there are any
alleged defaults of the lessee under the Ground Lease and, if there are, setting
forth the nature thereof in reasonable detail, (v) if any party under the Ground
Lease shall be in default, the default, and (vi) such other matters as
Administrative Agent shall reasonably request.

 

(14)         Common Area/Common Elements Insurance.  With respect to the Ground
Lease, Borrower and Leasehold Holder shall use commercially reasonable efforts
to cause the parties to the Ground Lease to maintain the insurance required to
be maintained by such parties thereunder and to deliver any insurance proceeds
payable to the Leasehold Holder under the Ground Lease to be delivered to
Administrative Agent or as required by the Ground Lease.  Without limitation of
the Loan Parties’ obligations under this Agreement, in the event any party to
the Ground Lease fails to maintain any insurance coverage required in the Ground
Lease and the failure would reasonably be expected to have a Material Adverse
Effect, Borrower or the Leasehold Holder shall obtain (or cause to be obtained)
such insurance coverage to satisfy such requirement.

 

(15)         Right to Participate.  Administrative Agent shall have the right,
but not the obligation, to proceed in respect of any claim, suit, action or
proceeding relating to the rejection of the Ground Lease by the Ground Lease Fee
Owner or any other party to the Ground Lease as a result of a bankruptcy of
Ground Lease Fee Owner or any other party to the Ground Lease, including,
without limitation, the right to file and prosecute any and all proofs of
claims, complaints, notices and other documents in any case in respect of Ground
Lease Fee Owner or any other party to the Ground Lease under and pursuant to the
Bankruptcy Code.

 

(16)         No Liability.  Administrative Agent shall have no liability or
obligation under the Ground Lease by reason of its acceptance of the Security
Instruments, this Agreement and the other Loan Documents.  Administrative Agent
shall be liable for the obligations of Leasehold Holder arising under the Ground
Lease in which Leasehold Holder possesses a Leasehold Estate for only that
period of time during which Administrative Agent

 

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has acquired, by foreclosure or otherwise, and is holding all of Leasehold
Holder’s right, title and interest therein.

 

(17)         Ground Lease Cure By Administrative Agent.  In the event of a
default by Leasehold Holder in the performance of any of its obligations under
the Ground Lease beyond any applicable notice and cure periods therein,
including, without limitation, any default in the payment of any sums payable
thereunder, then, in each and every such case, Administrative Agent may, at its
option, cause the default or defaults to be remedied and otherwise exercise any
and all rights of Leasehold Holder thereunder in the name of and on behalf of
Leasehold Holder.  Borrower or the Leasehold Holder shall, on demand, reimburse
Administrative Agent for all advances made and reasonable out-of-pocket expenses
incurred by Administrative Agent in curing any such default (including, without
limitation, reasonable attorneys’ fees and disbursements), together with
interest thereon computed at the Default Rate from the date that such advance is
made to and including the date the same is paid to Administrative Agent.

 

(18)         Option to Renew or Extend the Ground Lease.  The Leasehold Holder
shall duly exercise any renewal or extension option with respect to the Ground
Lease unless Administrative Agent notifies Borrower in writing that it has
reasonably determined that the exercise of such option is not necessary to
protect Administrative Agent’s security for the Loans.  The Loan Parties shall
deliver to Administrative Agent a copy of any notice of renewal or extension at
least five (5) business days prior to such notice being delivered to the Ground
Lease Fee Owner, together with the terms and conditions of such renewal or
extension.  If Leasehold Holder fails to renew or extend the term of the Ground
Lease in which Leasehold Holder possesses the Leasehold Estate, Administrative
Agent may, at its option, exercise the option to renew or extend in the name of
and on behalf of Leasehold Holder.  Each of Borrower and Leasehold Holder
acknowledges and consents that Administrative Agent is irrevocably appointed as
Leasehold Holder’s attorney-in-fact, coupled with an interest, to execute and
deliver, for and in the name of Leasehold Holder, all instruments and agreements
necessary under the Ground Lease or otherwise to cause any renewal or extension
of the Ground Lease in accordance with this Section 5.18.

 

(19)         Acquisition of Ground Lease Parcel.  No Loan Party shall exercise
the Ground Lease Parcel Purchase Option or otherwise acquire the Ground Lease
Parcel without the prior written consent of Administrative Agent (which may be
withheld in its sole discretion); provided that, Borrower (but not Leasehold
Holder) may, at Borrower’s option, exercise the Ground Lease Purchase Option and
acquire the Ground Lease Parcel without the consent of Administrative Agent if
(x) the costs and expenses to be incurred in connection with the exercise of the
Ground Lease Purchase Option (or acquisition of the Ground Lease Parcel)
(including the purchase price to acquire the respective Ground Lease Parcel and
costs and expenses of Borrower to comply with the provisions of this
Section 5.18(19)) (collectively, the “Ground Lease Parcel Purchase Costs and
Expenses”) are to be funded exclusively through capital contributions to
Borrower from Holdco, (y) Borrower provides Administrative Agent with evidence
reasonably satisfactory to Administrative Agent that such funds (a) are
available to Borrower to acquire the Ground Lease Parcel, (b) were obtained
exclusively through capital contributions to Borrower from Holdco, and (c) are
sufficient to pay the Ground Lease Parcel Purchase Option Costs and Expenses,
and (z) each of the

 

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following terms and conditions have been fully satisfied (unless waived in
writing by the Administrative Agent in its sole discretion):

 

(i)            Not less than thirty (30) days prior to the Ground Lease Parcel
Acquisition Closing Date, Borrower shall have delivered to Administrative Agent,
all of which deliveries shall be satisfactory to the Administrative Agent: 
(a) a map and site plan, including an existing Survey of the Ground Lease Parcel
dated not more than six (6) months prior to the Ground Lease Parcel Acquisition
Closing Date, (b) a copy of the proposed amendments to the Loan Documents to
include Ground Lease Parcel, (c) a commitment from the Title Company with
respect to the issuance of a Title Policy (or endorsements to the existing Title
Policy), together with copies of all exceptions referenced therein, (d) upon the
reasonable request of the Administrative Agent, a PML study, (e) an Appraisal
acceptable to Administrative Agent, (f) a copy of the flood certification,
(g) either (A) a letter or other evidence with respect to Ground Lease Parcel
from the appropriate Governmental Authorities concerning compliance with
applicable zoning and building laws, (B) an ALTA 3.1 zoning endorsement for the
Title Policy or (C) a zoning report prepared by The Planning & Zoning Resource
Corporation indicating that Ground Lease Parcel is in material compliance with
applicable zoning and building laws, (h) evidence that Ground Lease Parcel
constitutes one (1) or more separate tax lots, which evidence shall be
reasonably satisfactory in form and substance to Administrative Agent (evidence
of a separate tax lot endorsement for the Title Policy shall be evidence
reasonably satisfactory in form and substance to Administrative Agent),
(i) evidence reasonably satisfactory to Lenders and their insurance
consultant(s) of insurance policies covering Ground Lease Parcel satisfying all
of the requirements of this Agreement, and (j) UCC, bankruptcy, state and
federal tax lien, litigation and judgment searches conducted by a search firm
reasonably acceptable to the Lenders with respect to the Ground Lease Fee Owner
on the date immediately prior to acquisition thereof by Borrower, in each of the
locations reasonably specified by the Lenders and not revealing any Liens other
than Permitted Encumbrances.

 

(ii)           Administrative Agent shall have received at least thirty (30)
days prior to Ground Lease Parcel Acquisition Closing Date, and reviewed and
approved all material agreements relating to or affecting Ground Lease Parcel or
by which the Ground Lease Parcel is bound;

 

(iii)          Administrative Agent shall have received at least thirty (30)
days prior to the Ground Lease Parcel Acquisition Closing Date a Phase I
environmental assessment report, conducted under the ASTM International Standard
Practice for Environmental Site Assessments:  Phase I Environmental Site
Assessment Process E1527-05, issued by a recognized environmental consultant
which report shall be dated not more than six (6) months prior to the Ground
Lease Parcel Acquisition Closing Date and which report shall be reasonably
satisfactory to Administrative Agent;

 

(iv)          Delivery to Administrative Agent of evidence reasonably
satisfactory to Administrative Agent that all material governmental and third
party approvals (including any required gaming approvals) required for Borrower
to consummate the acquisition of Ground Lease Parcel have been secured;

 

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(v)           Delivery to Administrative Agent of favorable original opinions of
counsel or updates thereto in connection with the Ground Lease Parcel covering
due authorization, execution, delivery, enforceability and perfection of
security interests, similar in form and substance to the opinions which were
delivered on the Effective Date in connection with the Real Property, reasonably
satisfactory to Lenders and addressed to the Administrative Agent on behalf of
the Lenders;

 

(vi)          Delivery of original updated Organizational Documents of each of
the Borrower Parties, including, but not limited to a current certificate of
good standing; delivery of appropriate evidence of the authorization of the
applicable Borrower Parties approving the execution, delivery and performance of
the Loan Documents or amendments thereto being executed and delivered in
connection with the acquisition of the Ground Lease Parcel, duly adopted by the
applicable Borrower Parties and accompanied by an Officer’s Certificate stating
that such authorizations have not been altered or repealed and are in full force
and effect, and certifying as to the names of the Persons authorized to sign on
behalf of such parties, together with the true signatures of each such Person;

 

(vii)         Delivery to Administrative Agent of originals of the following
Loan Documents or amendments thereto:  (a) either a new Security Instrument, an
amendment to an existing Security Instrument, or a mortgage spreader agreement
(as selected by Administrative Agent) to encumber the Ground Lease Parcel, duly
executed and acknowledged by Borrower; (b) a first priority Assignment of Leases
and Rents (or amendment to the existing Assignment of Leases and Rents), from
Borrower, as assignor, to Administrative Agent, as assignee, assigning to
Administrative Agent all of Borrower’s interest in and to the Leases, rents and
security deposits as security for the Loans with respect to the Ground Lease
Parcel, duly executed and acknowledged by Borrower; (c) a first priority
Assignment of Contracts (or an amendment to the existing Assignment of
Contracts), from Borrower, as assignor, to Administrative Agent, as assignee,
with respect to the contracts relating to or affecting the Ground Lease Parcel
or by which the Ground Lease Parcel is bound, duly executed by Borrower; (d) UCC
financing statements (Form UCC-1) (or other forms required in any jurisdiction),
covering all fixtures and other personal property with respect to the Ground
Lease Parcel, and all proceeds thereof, naming Borrower, as debtor, and
Administrative Agent as secured party (together with the documents described in
the foregoing clauses (a), (b), (c) and (d) of this Section 5.18(19)(vii), the
“GL Parcel Security Documents”); (e) a new Title Policy or endorsements to the
existing Title Policy, (as determined by Administrative Agent in its sole
discretion), issued by the Title Company in an amount equal to the purchase
price for the Ground Lease Parcel (together with a tie-in endorsement between
the Title Policy for the Ground Lease Parcel and the existing Title Policy in
form and substance reasonably acceptable to Administrative Agent in an amount
equal to the purchase price for the Ground Lease Parcel), reflecting the
addition of the Ground Lease Parcel and containing such affirmative coverage
similar in form and substance to the affirmative coverage provided in the
existing Title Policy, insuring that the applicable Security Instrument, as may
be modified by a mortgage spreader agreement or other amendment, creates a valid
first lien on Borrower’s fee title in the Ground Lease Parcel subject to the
Permitted Encumbrances, and insuring the perfected first priority interest of
Administrative Agent

 

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pursuant to the applicable Security Instrument, as may be modified by a mortgage
spreader agreement or other amendment, and further (i) insuring the priority of
the applicable Security Instrument, as may be modified by the mortgage spreader
agreement or other amendment, over all intervening Liens on the Real Properties
including, without limitation, all mechanics’ or materialmen’s Liens for work
performed or material supplied to the Ground Lease Parcel, and (ii) disclosing
no matters affecting title to the Real Properties other than Permitted
Encumbrances; together with evidence of payment of any title insurance premiums,
fees or charges due in connection therewith, and the Borrower and Leasehold
Holder shall cooperate with Administrative Agent and execute such further
instruments and documents and perform such further acts as Administrative Agent
or the Title Company shall reasonably request to carry out the creation and
perfection of the liens and security interests contemplated by the GL Parcel
Security Documents and the release, discharge and removal of any encumbrances
required for the issuance of the Title Policy; (f) updates to any of the other
Loan Documents and the Exhibits and Schedules thereto, as applicable; (g) a
confirmation of the Recourse Guaranty in customary form duly executed and
delivered by Recourse Guarantor affirming its obligations thereunder; (h) a
confirmation of the Payment Guaranty in customary form duly executed and
delivered by the Leasehold Holder affirming Leasehold Holder’s obligations
thereunder; and (i) a confirmation of the Pledge Agreement in customary form
duly executed and delivered by Pledgor, affirming its obligations under the
Pledge Agreement;

 

(viii)        Delivery to Administrative Agent of a ground lease between
Borrower, as fee owner, and Leasehold Holder, as tenant (the “New Ground Lease”)
and a tenant estoppels certificate from Leasehold Holder to the benefit of
Administrative Agent, in each case, in form and substance satisfactory to
Administrative Agent;

 

(ix)           Receipt of evidence, satisfactory to Administrative Agent, that
neither the acquisition of the Ground Lease Parcel by Borrower or the New Ground
Lease will result in a Property Material Adverse Effect or in any interruption
in the use or operation of the Hotel/Casino Facility;

 

(x)            Borrower shall pay for any and all reasonable out-of-pocket costs
and expenses of Administrative Agent and the Lenders incurred in connection with
the proposed acquisition of the Ground Lease Parcel, including reasonable
attorneys’ fees and disbursements, all title insurance premiums for any
endorsements to any existing Title Policy (or new Title Policy) reasonably
required by Lenders in connection with such proposed acquisition, title
premiums, mortgage recording taxes, transfer taxes and recording fees.  In
addition, Borrower shall deliver to Lenders evidence reasonably satisfactory to
Lenders that all amounts owing to any parties in connection with the
transactions relating to the proposed acquisition of the Ground Lease Parcel by
Borrower have been paid in full, or will simultaneously be paid in full on the
Ground Lease Parcel Acquisition Closing Date or adequate reserves therefor are
established by Borrower in cash with respect to contingent or other liabilities
that may arise out of such transaction and for which Borrower is not adequately
indemnified or insured against as reasonably determined by Lenders.

 

(xi)           The Administrative Agent shall have received such additional
documents,

 

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information and materials as any Lender, through the Administrative Agent, may
reasonably request, provided such requests are customary and are consistent with
the deliveries required with respect to the Real Properties on the Ground Lease
Parcel Closing Date.

 

(20)         Event of Default. Following the occurrence and during the
continuance of an Event of Default, in the event Administrative Agent determines
to exercise the Ground Lease Parcel Purchase Option and purchase the Ground
Lease Parcel either pursuant to the terms of the Ground Lease or as otherwise
may be agreed upon between Administrative Agent and Ground Lease Fee Owner,
Borrower and Leasehold Holder shall cooperate in good faith with any such
exercise and purchase by Administrative Agent.

 

5.19         Management Agreement.

 

(1)           No Election to Terminate.  Neither Borrower or Leasehold Holder
shall permit, acquiesce, elect or consent to treat any Management Agreement as
terminated, canceled or surrendered pursuant to the applicable provisions of the
Bankruptcy Code (including, without limitation, Section 365(h)(1) thereof)
without Administrative Agent’s prior written consent in the event a bankruptcy
of Borrower, Leasehold Holder, any Manager or any other party to any Management
Agreement.

 

(2)           Notice Prior to Rejection.  Borrower or the Leasehold Holder shall
give Administrative Agent not less than thirty (30) days prior written notice of
the date on which Borrower or Leasehold Holder shall apply to any court or other
Governmental Authority for authority and permission to reject any Management
Agreement in the event that there shall be filed by or against Borrower or
Leasehold Holder any petition, action or proceeding under the Bankruptcy Code or
under any other similar federal or state law now or hereafter in effect and if
Borrower or Leasehold Holder determines to reject the applicable Management
Agreement.  Lender shall have the right, but not the obligation, to serve upon
Borrower or the Leasehold Holder within such thirty (30) day period a notice
stating that (i) Administrative Agent demands that Borrower or Leasehold Holder
assume and assign the applicable Management Agreement to Administrative Agent
(or its designee) subject to and in accordance with the Bankruptcy Code, and
(ii) Administrative Agent covenants to cure or provide reasonably adequate
assurance thereof with respect to all defaults reasonably susceptible of being
cured by Lender and of future performance under such Management Agreement.  If
Administrative Agent serves upon Borrower or Leasehold Holder the notice
described above, Borrower or the Leasehold Holder shall not reject the
applicable Management Agreement and shall comply with the demand provided for in
clause (i) above within fifteen (15) days after the notice shall have been given
by Administrative Agent.

 

(3)           Administrative Agent Right to Perform.  During the continuance of
an Event of Default and subject to applicable Gaming Laws, each Loan Party
acknowledges and consents that Administrative Agent shall have the right, but
not the obligation, (i) to perform and comply with all obligations of Borrower
or Leasehold Holder under any Management Agreement without relying on any grace
period provided therein, and (ii) to do and take, without any obligation to do
so, such actions as Administrative Agent deems necessary or desirable to prevent
or cure any default by Borrower or Leasehold Holder under any

 

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Management Agreement, including, without limitation, any act, deed, matter or
thing whatsoever that Borrower or Leasehold Holder may do in order to cure a
default under any Management Agreement.  Borrower and the Leasehold Holder
shall, within five (5) Business Days after written request is made therefor by
Administrative Agent, execute and deliver to Administrative Agent or to any
party designated by Administrative Agent, such further instruments, agreements,
powers, assignments, conveyances or the like as may be reasonably necessary to
complete or perfect the interest, rights or powers of Administrative Agent
pursuant to this Section or as may otherwise be required by Administrative
Agent.

 

(4)           Attorney in Fact.  In the event of any arbitration under or
pursuant to any Management Agreement in which Administrative Agent elects to
participate, each Loan Party hereby acknowledges and consents that
Administrative Agent shall be irrevocably appointed as the Leasehold Holder’s
and Borrower’s true and lawful attorney-in-fact (which appointment shall be
deemed coupled with an interest) to exercise, during the continuance of an Event
of Default, all right, title and interest of Leasehold Holder and Borrower in
connection with such arbitration, including, without limitation, the right to
appoint arbitrators and to conduct arbitration proceedings on behalf of
Leasehold Holder, Borrower and Administrative Agent.  All reasonable
out-of-pocket costs and expenses incurred by Administrative Agent (and any
Lenders) in connection with such arbitration and the settlement thereof shall be
borne solely by Borrower and the Leasehold Holder, including, without
limitation, reasonable attorneys’ fees and disbursements.  Nothing contained in
this Section shall obligate Administrative Agent to participate in any such
arbitration.

 

(5)           Payment of Sums Due Under Management Agreement.  Borrower or the
Leasehold Holder shall pay all management fees and other charges reserved in or
payable under any Management Agreement on or prior to the due date thereof
except where (i) the validity or amount thereof is being contested in good
faith, (ii) the Borrower or the Leasehold Holder has set aside on its books
adequate reserves with respect thereto in accordance with GAAP, and (iii) the
failure to make payment pending such contest would not reasonably be expected to
result in a Material Adverse Effect or a Property Material Adverse Effect or
termination of such Management Agreement.

 

(6)           Performance of Covenants.  Borrower and Leasehold Holder shall:
(i) promptly perform and observe in all material respects all of the terms,
covenants and conditions required to be performed and observed by the Leasehold
Holder and Borrower under each Management Agreement, the breach of which could
permit any party to such Management Agreement validly to terminate such
Management Agreement (including, without limitation, all payment obligations),
(ii) do all things commercially reasonable to preserve and to keep unimpaired
its rights under each Management Agreement, (iii) not waive, excuse or discharge
any of the material obligations of any Manager or any other party to any
Management Agreement without Administrative Agent’s prior written consent in
each instance, and (iv) enforce the material obligations of the applicable
Manager and the other parties to each Management Agreement, except, in the case
of the foregoing clauses (i) through (iv), in any such case where same would not
reasonably be expected to have a Material Adverse Effect.

 

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(7)           No Modification or Termination.

 

(i)            Neither the Leasehold Holder nor Borrower shall consent to or
acquiesce in any amendment, modification, waiver or change to any Management
Agreement in any manner adverse to the interests of the Lenders in any material
respect or any assignment of any Management Agreement (other than an assignment
to a wholly owned Subsidiary of the applicable Manager in accordance with the
applicable Management Agreement as in effect on the date hereof); it being
acknowledged and agreed by the parties hereto that any amendment, waiver or
other modification which would have the effect of (A) increasing management
fees, required reserves or termination fees, (B) shortening the term thereof or
(C) modifying events of default, rights of termination, standards of care and
operation, management responsibilities, intellectual property licenses or
approval and supervisory rights of members or shareholders shall be deemed
adverse to the interests of the Lenders in a material respect.

 

(ii)           Neither the Leasehold Holder nor Borrower shall permit, consent
to or acquiesce in any cancellation, termination or surrender of any Management
Agreement.

 

(8)           Notices of Default.  Borrower and Leasehold Holder shall promptly
(but in any event no later than two (2) Business Days after Borrower’s or
Leasehold Holder’s receipt thereof) deliver (or cause to be delivered) to
Administrative Agent copies of any written notice of default by any party under
any Management Agreement, or of any written notice from any Manager or any other
party to each Management Agreement of its intention to terminate any Management
Agreement.

 

(9)           Delivery of Information.  Borrower and Leasehold Holder shall
promptly furnish (or cause to be furnished) to Administrative Agent copies of
such information and evidence as Administrative Agent may reasonably request
concerning the Leasehold Holder’s or Borrower’s due observance, performance and
compliance with the terms, covenants and conditions of each Management
Agreement.

 

(10)         Other Management Agreements; Delegation of Manager’s Duties. 
Neither the Leasehold Holder nor Borrower shall enter into any management
agreements other than the Management Agreements, and no Manager shall be
permitted to assign or sub-contract its duties or responsibilities under any
Management Agreement (except as permitted under such Management Agreement as in
effect on the Effective Date), in each case without Administrative Agent’s prior
written consent, which may be withheld in its sole discretion.

 

(11)         Further Assurances.  Borrower and Leasehold Holder, at their sole
cost and expense, shall execute and deliver to Administrative Agent, within five
(5) Business Days after request, such documents, instruments or agreements as
may be reasonably required to permit Administrative Agent to cure any default
under any Management Agreement.

 

(12)         Management Agreement Cure By Administrative Agent.  In the event of
a default by Leasehold Holder or Borrower in the performance of any of their
respective obligations under any Management Agreement beyond any applicable
notice and cure periods therein, including, without limitation, any default in
the payment of any sums payable thereunder, then, in each and every such case,
subject to applicable Gaming Laws, Administrative Agent may, at its option,
cause the default or defaults to be remedied and otherwise exercise any and all
rights of the Leasehold Holder and/or Borrower thereunder in

 

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the name of and on behalf of Leasehold Holder and/or Borrower.  Borrower shall,
on demand, reimburse (and cause the Leasehold Holder to reimburse)
Administrative Agent for all advances made and reasonable out-of-pocket expenses
incurred by Administrative Agent in curing any such default (including, without
limitation, reasonable attorneys’ fees and disbursements), together with
interest thereon computed at the Default Rate from the date that such advance is
made to and including the date the same is paid to Administrative Agent.

 

(13)         Subordination. Borrower and the Leasehold Holder shall at all times
cause the Management Agreements and all management fees payable thereunder to be
subordinated to the Loans and lien of the Collateral Documents pursuant to a
written subordination of the Management Agreements in form and substance
acceptable to Administrative Agent in its sole discretion.

 

(14)         Terminable at Will. Borrower and the Leasehold Holder shall at all
times cause the Management Agreements to be terminable by Borrower or the
Leasehold Holder at will without fee or penalty.

 

(15)         Deferred Management Fees.  The management fees payable under the
HCF Management Agreement shall be deferred to the extent that net cash flow from
the Hotel/Casino Facility (i.e. after payment of all amounts due under the
Ground Lease, including, but not limited to, Ground Rent, verifiable operating
expenses (excluding management fees payable under the HCF Management Agreement)
of the Hotel/Casino Facility and Capital Expenditures) is not sufficient to pay
the current management fees payable thereunder (the “Deferred Management
Fees”).  Deferred Management Fees may be paid from net cash flow remaining after
payment of all amounts due under the Ground Lease, including, but not limited
to, Ground Rent, verifiable operating expenses of the Hotel/Casino Facility,
Capital Expenditures and current management fees payable under the HCF
Management Agreement. In addition, Borrower and Leasehold Holder shall at all
times cause the HCF Management Agreement, and any related subordination
agreement required under Section 5.19 (13) above to contain the provisions of
this Section 5.19(15).

 

(16)         Rights of Administrative Agent. Administrative Agent shall have the
right (but shall have no obligation) at any time that there shall exist and be
continuing an Event of Default, to take in Administrative Agent’s own name or in
the name of Borrower or the Leasehold Holder or any or all of them (but at
Borrower’s or the Leasehold Holder’s expense, which shall be reimbursed to
Administrative Agent upon demand and shall constitute part of the Obligations),
such action as Administrative Agent may at any time or from time to time
determine to be necessary, subject to applicable Gaming Laws:

 

(i)                                     To exercise any of the rights of
Borrower or Leasehold Holder under the applicable Management Agreement and to
request and require the applicable Manager to attorn to Administrative Agent (or
its designee);

 

(ii)                                  To terminate the applicable Management
Agreement without fee or penalty;

 

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(iii)                               To amend, modify or extend the applicable
Management Agreement by agreement with the applicable Manager;

 

(iv)                              To cure any default under the applicable
Management Agreement; and

 

(v)                                 To protect the rights of Administrative
Agent hereunder and under the applicable Management Agreement;

 

and Administrative Agent shall incur no liability as between itself and Borrower
and/or the Leasehold Holder if any action taken by or on its behalf in good
faith pursuant hereto shall prove to be, in whole or in part, inadequate or
invalid. Borrower and the Leasehold Holder hereby irrevocably empower and
authorize Administrative Agent and hereby irrevocably appoint Administrative
Agent as Borrower’s and Leasehold Holder’s attorney-in-fact to enforce
Borrower’s and Leasehold Holder’s rights under the Management Agreements upon
the occurrence and continuance of an Event of Default.

 

5.20         Option Parcel Covenants.

 

(1)           Performance of Covenants.  Borrower shall promptly perform and
observe in all material respects all of the terms, covenants and conditions
required to be performed and observed by Borrower under the Option Agreement
with respect to the Option Parcels, the breach of which could permit any party
thereto validly to terminate such Option Agreement, provided, nothing contained
herein shall obligate Borrower to exercise any option to purchase any Option
Parcel (except as specifically set forth herein), and Borrower shall diligently
and continuously enforce the material obligations of the Option Parcels Fee
Owner and the other parties to the Option Agreement except in any such case
where same would not have a Material Adverse Effect.

 

(2)           No Modification, Termination, Lien.

 

(i)            Borrower shall not, except as permitted hereunder or with the
prior written consent of Administrative Agent, permit, consent to or acquiesce
in any Modification to the Option Agreement that is adverse to the Lenders, it
being agreed that any such Modification that changes the term of the Option
Parcels Purchase Option, affects the purchase price of the Option Parcels or
other payments due under the Option Agreement, affects or relates to any option
or right to purchase all or any of the Option Parcels, affects the rights of
Administrative Agent or the Lenders under the Option Agreement, or otherwise
increases Borrower’s obligations or liabilities under the Option Agreement
and/or that reduces the benefits to be received by Borrower under the Option
Agreement shall be deemed to be adverse to the Lenders.

 

(ii)           Borrower shall not cancel, terminate or surrender the Option
Agreement or permit, consent to or acquiesce in any cancellation, termination or
surrender of the Option Agreement, without in each case the prior written
consent of Administrative Agent.

 

(iii)          Except in connection with the Loan Documents, Borrower shall not
create, incur, assume, permit or suffer to exist any Lien with respect to the
Option

 

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Agreement.

 

(3)           Notices of Default.  Borrower shall deliver to Administrative
Agent copies of any written notice of default by any party under the Option
Agreement with respect to the Option Parcels, or of any written notice from the
Options Parcels Fee Owner or any other party of its intention to terminate the
Option Agreement, promptly (but in any event no later than two (2) Business Days
after Borrower’s delivery or receipt thereof) upon delivery or receipt of such
notice, as the case may be.

 

(4)           Delivery of Information.  Borrower shall promptly furnish to
Administrative Agent copies of such information and evidence as Administrative
Agent may reasonably request concerning Borrower’s due observance, performance
and compliance with the material terms, covenants and conditions of the Option
Agreement with respect to the Option Parcels.

 

(5)           No Liability.  Administrative Agent shall have no liability or
obligation under the Option Agreement by reason of its acceptance of the
Security Instruments, this Agreement and the other Loan Documents.

 

(6)           Acquisition of Option Parcels. Borrower shall not exercise the
Option Parcels Purchase Option or otherwise acquire any of the Option Parcels
without the prior written consent of Administrative Agent; provided that, no
such consent of Administrative Agent shall be required if (x) the costs and
expenses incurred in connection with the acquisition of any of the Option
Parcels (including the purchase price to acquire the respective Option
Parcel(s) and the costs and expenses of Borrower to comply with the provisions
of this Section 5.20(6)) (collectively, the “Option Parcel Purchase Costs and
Expenses”) are to be funded exclusively through capital contributions to
Borrower from Holdco, (y) Borrower provides Administrative Agent with evidence
reasonably satisfactory to Administrative Agent that such funds (a) are
available to Borrower to acquire the applicable Option Parcel(s), (b) were
obtained exclusively through capital contributions from Holdco to Borrower, and
(c) are sufficient to pay the Option Parcel Purchase Option Costs and Expenses,
and (z) each of the following terms and conditions is satisfied (unless waived
in writing by the Administrative Agent in its sole discretion):

 

(i)            Not less than thirty (30) days prior to the Option
Parcel(s) Acquisition Closing Date, Borrower shall have delivered to
Administrative Agent with respect to the Option Parcel(s) to be acquired, all of
which deliveries shall be satisfactory to the Administrative Agent:  (a) a map
and site plan, including an existing Survey of such Option Parcel(s) dated not
more than six (6) months prior to the Option Parcel(s) Acquisition Closing Date,
(b) a copy of the proposed amendments to the Loan Documents to include such
Option Parcel(s), (c) tenant estoppel certificates and tenant subordination and
non-disturbance agreements for each tenant under any Leases affecting such
Option Parcel(s) which will not expire on or prior to the date that is six
(6) months before the Original Maturity Date and is not terminable without cost
to Borrower upon not more than sixty (60) days notice to tenant, or is otherwise
not on terms and conditions similar to the Existing Leases (a “Long-Term Option
Parcel Lease”), in each case in form and substance satisfactory to
Administrative Agent, together with any consents required with respect to the
contemplated transactions, (d) a

 

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commitment from the Title Company with respect to the issuance of a Title Policy
(or endorsements to the existing Title Policy), together with copies of all
exceptions referenced therein, (e) upon the reasonable request of the
Administrative Agent, a PML study, (f) an Appraisal acceptable to Administrative
Agent, (g) a copy of the flood certification, (h) either (A) a letter or other
evidence with respect to such Option Parcel(s) from the appropriate Governmental
Authorities concerning compliance with applicable zoning and building laws,
(B) an ALTA 3.1 zoning endorsement for the Title Policy or (C) a zoning report
prepared by The Planning & Zoning Resource Corporation indicating that such
Option Parcel(s) are in material compliance with applicable zoning and building
laws, (i) evidence that each of such Option Parcel(s) constitutes one (1) or
more separate tax lots, which evidence shall be reasonably satisfactory in form
and substance to Administrative Agent (evidence of a separate tax lot
endorsement for the Title Policy shall be evidence reasonably satisfactory in
form and substance to Administrative Agent), (j) evidence reasonably
satisfactory to Lenders and their insurance consultant(s) of insurance policies
covering such Option Parcel(s) satisfying all of the requirements of this
Agreement, and (k) UCC, bankruptcy, state and federal tax lien, litigation and
judgment searches conducted by a search firm reasonably acceptable to the
Lenders with respect to the applicable Option Parcels Fee Owner on the date
immediately prior to acquisition thereof by Borrower, in each of the locations
reasonably specified by the Lenders and not revealing any Liens other than
Permitted Encumbrances.

 

(ii)           Administrative Agent shall have received at least thirty (30)
days prior to the Option Parcel(s) Acquisition Closing Date true, accurate,
correct and complete copies of all Long-Term Option Parcel Leases and all
related documents; and Administrative Agent shall have determined that each such
Long-Term Option Parcel Lease contains customary business terms and is in form
and substance acceptable to the Administrative Agent, in its reasonable
discretion;

 

(iii)          Administrative Agent shall have received at least thirty (30)
days prior to the Option Parcel(s) Acquisition Closing Date, and reviewed and
approved all material agreements relating to or affecting such Option
Parcel(s) or by which such Option Parcel(s) are bound;

 

(iv)          Administrative Agent shall have received at least thirty (30) days
prior to the Option Parcel(s) Acquisition Closing Date a Phase I environmental
assessment report, conducted under the ASTM International Standard Practice for
Environmental Site Assessments:  Phase I Environmental Site Assessment Process
E1527-05, issued by a recognized environmental consultant which report shall be
dated not more than six (6) months prior to the Option Parcel(s) Acquisition
Closing Date and which report shall be reasonably satisfactory to Administrative
Agent;

 

(v)           Delivery to Administrative Agent of evidence reasonably
satisfactory to Administrative Agent that all material governmental and third
party approvals (including any required gaming approvals) required for Borrower
to consummate the acquisition of such Option Parcel(s) have been secured;

 

(vi)          Delivery to Administrative Agent of favorable original opinions of
counsel or updates thereto in connection with such Option Parcel(s), covering
due

 

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authorization, execution, delivery, enforceability and perfection of security
interests, similar in form and substance to the opinions which were delivered on
the Effective Date in connection with the Real Property, reasonably satisfactory
to Lenders and addressed to the Administrative Agent on behalf of the Lenders;

 

(vii)         Delivery of original updated Organizational Documents of each of
the Borrower Parties, including, but not limited to a current certificate of
good standing; delivery of appropriate evidence of the authorization of the
applicable Borrower Parties approving the execution, delivery and performance of
the Loan Documents or amendments thereto being executed and delivered in
connection with the acquisition of such Option Parcel(s), duly adopted by the
applicable Borrower Parties and accompanied by an Officer’s Certificate stating
that such authorizations have not been altered or repealed and are in full force
and effect, and certifying as to the names of the Persons authorized to sign on
behalf of such parties, together with the true signatures of each such Person;

 

(viii)        Delivery of the insurance certificates with respect to such Option
Parcel(s) required hereunder;

 

(ix)           Delivery to Administrative Agent of originals of the following
Loan Documents or amendments thereto:  (a) either a new Security Instrument, an
amendment to an existing Security Instrument, or a mortgage spreader agreement
(as selected by Administrative Agent in its sole discretion) to encumber such
Option Parcel(s), duly executed and acknowledged by Borrower; (b) a first
priority Assignment of Leases and Rents (or amendment to the existing Assignment
of Leases and Rents), from Borrower, as assignor, to Administrative Agent, as
assignee, assigning to Administrative Agent all of Borrower’s interest in and to
the Leases, rents and security deposits as security for the Loans with respect
to such Option Parcel(s), duly executed and acknowledged by Borrower; (c) a
first priority Assignment of Contracts (or an amendment to the existing
Assignment of Contracts), from Borrower, as assignor, to Administrative Agent,
as assignee, with respect to the contracts relating to or affecting such Option
Parcel(s) or by which such Option Parcel(s) are bound, duly executed by
Borrower; (d) UCC financing statements (Form UCC-1) (or other forms required in
any jurisdiction), covering all fixtures and other personal property with
respect to such Option Parcel(s), and all proceeds thereof, naming Borrower, as
debtor, and Administrative Agent as secured party (together with the documents
described in the foregoing clauses (a), (b), (c) and (d) of this Section 5.20
(6)(ix), the “Option Parcel Security Documents”); (e) a new Title Policy or
endorsements to the existing Title Policy (as determined by Administrative Agent
in its sole discretion), issued by the Title Company in an amount equal to the
purchase price for such Option Parcel(s) (together with a tie-in endorsement
between the Title Policy for such Option Parcel(s) and the existing Title Policy
in form and substance reasonably acceptable to Administrative Agent in an amount
equal to the purchase price for such Option Parcel(s)), reflecting the addition
of each such Option Parcel(s) and containing such affirmative coverage similar
in form and substance to the affirmative coverage provided in the existing Title
Policy, insuring that the applicable Security Instrument, as may be modified by
a mortgage spreader agreement, creates a valid first lien on Borrower’s fee
title in such Option Parcel(s) subject to the Permitted Encumbrances (for
purposes of this Section 5.20(6)(ix), the Permitted Encumbrances described in
clause (b) of the definition thereof shall mean the exceptions to title
identified in the title commitment for such Option Parcel(s) delivered by
Borrower pursuant to

 

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Section 5.20(6)(i)(d) that shall have been approved by Administrative Agent),
and insuring the perfected first priority interest of Administrative Agent
pursuant to the applicable Security Instrument, as may be modified by a mortgage
spreader agreement or other amendment, and further (i) insuring the priority of
the applicable Security Instrument, as may be modified by a mortgage spreader
agreement or other amendment, over all intervening Liens on the Real Properties
including, without limitation, all mechanics’ or materialmen’s Liens for work
performed or material supplied to the applicable Option Parcel, and
(ii) disclosing no matters affecting title to the Real Properties other than
Permitted Encumbrances; together with evidence of payment of any title insurance
premiums, fees or charges due in connection therewith, and the Borrower shall
cooperate with Administrative Agent and execute such further instruments and
documents and perform such further acts as Administrative Agent or the Title
Company shall reasonably request to carry out the creation and perfection of the
liens and security interests contemplated by the Option Parcel Security
Documents and the release, discharge and removal of any encumbrances required
for the issuance of the Title Policy; (f) updates to any of the other Loan
Documents and the Exhibits and Schedules thereto, as applicable; (g) a
confirmation of the Recourse Guaranty in customary form duly executed and
delivered by Recourse Guarantor affirming its obligations thereunder; (h) a
confirmation of the Payment Guaranty in customary form duly executed and
delivered by the Leasehold Holder affirming Leasehold Holder’s obligations
thereunder; and (i) a confirmation of Pledge Agreement in customary form duly
executed and delivered by Pledgor, affirming its obligations under the Pledge
Agreement;

 

(x)            Borrower shall pay for any and all reasonable out-of-pocket costs
and expenses of Administrative Agent and the Lenders incurred in connection with
the proposed acquisition of such Option Parcel(s), including reasonable
attorneys’ fees and disbursements, all title insurance premiums for any
endorsements to any existing Title Policy (or new Title Policy) reasonably
required by Lenders in connection with such proposed acquisition, mortgage
recording taxes, transfer taxes and recording fees.  In addition, Borrower shall
deliver to Lenders evidence reasonably satisfactory to Lenders that all amounts
owing to any parties in connection with the transactions relating to the
proposed acquisition of the Option Parcel(s) by Borrower have been paid in full,
or will simultaneously be paid in full on the Option Parcel(s) Acquisition
Closing Date or adequate reserves therefor are established by Borrower in cash
with respect to contingent or other liabilities that may arise out of such
transaction and for which Borrower is not adequately indemnified or insured
against as reasonably determined by Lenders; and

 

(xi)           The Administrative Agent shall have received such additional
documents, information and materials as any Lender, through the Administrative
Agent, may reasonably request, provided such requests are customary and are
consistent with the deliveries required with respect to the Real Properties on
the Effective Date.

 

(7)           Event of Default. Following the occurrence and during the
continuance of an Event of Default, in the event Administrative Agent determines
to exercise the Option Parcels Purchase Option and purchase one or more Option
Parcels either pursuant to the terms of the Option Agreement or as otherwise may
be agreed upon between Administrative Agent and Option Parcels Fee Owner,
Borrower shall cooperate in good faith with any such exercise and purchase by
Administrative Agent.

 

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5.21         Accounts.  Each Account of the Loan Parties (other than Excluded
Accounts) shall be subject to a Control Agreement in favor of the Administrative
Agent.

 

5.22         Gaming Matters/Licenses/Approvals/Permits.  Borrower and Leasehold
Holder shall take, or shall otherwise cause to be taken, all action necessary to
maintain in full force and effect and in good standing any and all Gaming
Permits and approvals or other entitlements allowing for the conduct, either
currently or in the future, of nonrestricted gaming activities on any Mortgaged
Property (or any portion thereof) including without limitation the maintenance
of any such Mortgaged Property (or any portion thereof) as within a “Gaming
Enterprise District” (as defined in NRS 463.0158) by complying at all times with
the signage requirements specified in NRS 463.3092.  To the extent applicable,
Borrower and Leasehold Holder shall also take or otherwise cause to be taken all
action necessary to maintain in full force and effect and in good standing any
currently existing “grandfathered” status for nonrestricted gaming activities in
connection with any prior nonconforming nonrestricted gaming use on any
Mortgaged Property (or any portion thereof). Borrower and Leasehold Holder shall
cooperate with the Gaming Authorities and provide the data reasonably requested
by such Gaming Authorities in order to maintain such Gaming Permits and
approvals and shall promptly deliver copies of all such Gaming Permits and
approvals to Lender.

 

ARTICLE VI

NEGATIVE COVENANTS

 

Each of the Loan Parties hereby covenants and agrees with the Administrative
Agent and each Lender that, as long as any Loans remain unpaid:

 

6.1           Liens.  The Loan Parties shall not create, incur, assume, permit
or suffer to exist, any Lien upon any of Loan Parties Property except:

 

(1)           Permitted Encumbrances; and

 

(2)           Other Liens which are the subject of a Good Faith Contest.

 

6.2           Indebtedness.  The Loan Parties shall not incur any Indebtedness
other than the Permitted Debt.

 

6.3           Fundamental Change.

 

(1)           No Loan Party shall do any or all of the following: merge or
consolidate with any Person, form any Subsidiary, enter into a Joint Venture,
partnership or any other similar business relationship with any other Person, or
sell, assign, lease or otherwise effect a Disposition, whether in one
transaction or in a series of transactions, of all or substantially all of its
Property and assets, whether now owned or hereafter acquired, or enter into any
agreement to do any of the foregoing.

 

(2)           No Loan Party shall engage in any business other than its Purpose.

 

6.4           Disposition. No Loan Party shall cause or permit any of the
following to occur:

 

(1)           Any Change of Control, provided that the acquisition of Capital
Stock in Borrower and/or Leasehold Holder pursuant to the Warrants shall be
permitted so long as

 

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Borrower and/or Leasehold Holder has used commercially reasonable efforts to
cause the holders of the applicable Warrants to cooperate and perform the
following: (i) Administrative Agent has received (A) written notice of the
exercise of the Warrants at least fifteen (15) Business Days prior to the date
the acquisition of Capital Stock in Borrower and/or Leasehold Holder pursuant to
the Warrants is to be consummated, along with copies of proposed documents
(including proposed amendments or restatements of Borrower’s and/or Leasehold
Holder’s Organizational Documents) to be entered into in connection with such
exercise of the Warrants, (B) a pledge agreement in a form substantially similar
to the Pledge Agreement from each Person acquiring any Capital Stock in Borrower
or Leasehold Holder pursuant to the Warrants wherein such Person pledges 100% of
the Capital Stock owned by such Person in Borrower and/or Leasehold Holder, as
applicable, to Administrative Agent, for the benefit of the Secured Parties, as
security for the Obligations, (C) if such Capital Stock is certificated, the
original certificates and stock powers (in form and substance satisfactory to
Administrative Agent) executed in blank, (D) favorable original opinions of
counsel covering due authorization, execution, delivery, enforceability and
perfection of security interests created by such pledge agreement, reasonably
satisfactory to Administrative Agent and addressed to the Administrative Agent
on behalf of the Lenders, (E) promptly following the acquisition of Capital
Stock in Borrower and/or Leasehold Holder pursuant to the Warrants, an executed
copy of any amendments, restatements or other modifications to the
Organizational Documents of Borrower and/or Leasehold Holder, as applicable, in
form and substance satisfactory to Administrative Agent, and (F) any other
documentation related to the exercise of the Warrants reasonably required by
Administrative Agent, including an organizational chart and amendments or
modifications to this Agreement in order to update Exhibit C hereto;

 

(2)           Any Disposition by any member, other than a member who received
such Capital Stock by direct or indirect exercise of a Warrant, in any Loan
Party of any of the Capital Stock in such Loan Party; or

 

(3)           Without the Administrative Agent’s prior written consent (to be
granted or withheld in its sole and absolute discretion), a Disposition of
legal, Beneficial or direct or indirect equitable interests in all or any part
of the Collateral, except as follows:

 

(i)            Approved Leases.  Borrower and the Leasehold Holder may enter
into Approved Leases for space at the Mortgaged Property, subject to any express
restrictions set forth in this Agreement.

 

(ii)           Sale of Personal Property.  The Borrower and the Leasehold Holder
may effect a Disposition of Personal Property (other than Capital Stock as
restricted in this Section 6.4), free from the Lien of the Collateral Documents,
to the extent such Disposition of Personal Property will not materially impair
the value, utility, or operation of the subject Mortgaged Property or such
disposed Personal Property is immediately replaced with similar Personal
Property that has a market value greater than or equal to the market value of
the disposed Personal Property and provided that any new Personal Property
acquired by the Borrower or Leasehold Holder, as applicable (and not so disposed
of), shall be subject to the Lien of the Security Instruments. Notwithstanding
any of the foregoing to the contrary, neither Borrower nor Leasehold Holder may
effect a Disposition of any Personal Property which is

 

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used in connection with the operation of the Hotel/Casino Facility (including,
without limitation, gaming equipment used in connection with the Hotel/Casino
Facility) without the prior written consent of Administrative Agent; provided
that so long as no Potential Event of Default or Event of Default exists,
Borrower and Leasehold Holder may cause a Disposition of such Personal Property
provided it is promptly replaced with similar Personal Property of at least
equal value and utility, which shall be subject to the Lien of the Security
Instruments. The Administrative Agent shall, from time to time, upon receipt of
an Officer’s Certificate requesting the same and confirming satisfaction of the
conditions set forth above, execute a written instrument in form reasonably
satisfactory to the Administrative Agent and the Borrower or Leasehold Holder,
as applicable, to confirm that such Personal Property which is to be, or has
been, sold or disposed of is free from the Lien of the Security Instruments.  To
the extent Borrower or Leasehold Holder is paid an amount or becomes entitled to
any payment or other compensation therewith with respect to any such
Disposition,  all or a portion of such amount is not used to purchase
replacement Personal Property and the net amount received by Borrower or
Leasehold Holder (i.e., the gross amount received by Borrower or Leasehold
Holder in connection with such Disposition less payments of any customary and
reasonable costs and expenses incurred in connection with such Disposition and
the cost of any replacement Personal Property) exceeds $100,000, such net amount
shall be promptly remitted by Borrower or the Leasehold Holder to Administrative
Agent for application against the outstanding Obligations. With respect to
amounts from Dispositions that Borrower or Leasehold Holder is not required to
remit to Administrative Agent pursuant to the preceding sentence (the “Unpaid
Disposition Amounts”), to the extent the aggregate amount of all such Unpaid
Disposition Amounts during any Fiscal Year exceeds $250,000 (after payment of
any customary and reasonable costs and expenses incurred in connection with such
Disposition and the costs of any replacement Personal Property purchased with
such Unpaid Disposition Amounts), such excess shall be promptly remitted by
Borrower or the Leasehold Holder to Administrative Agent for application against
the outstanding Obligations. Any payment or compensation received by Borrower or
Leasehold Holder with respect to any Disposition which is not remitted to
Administrative Agent shall, to the extent not otherwise included in the
calculation of Consolidated Net Income, shall be included as an increase in cash
for purposes of the calculation of Excess Cash Flow.

 

(iii)          Immaterial Transfers.  Subject to the provisions of
Section 6.4(3)(ii) above, the Borrower and the Leasehold Holder may, subject to
the prior written consent of the Administrative Agent, not to be unreasonably
withheld, (A) make immaterial Dispositions (including, but not limited to, lot
line adjustments) of portions of the Mortgaged Property to Governmental
Authorities for dedication or public use or, portions of the Mortgaged Property
to third parties for the purpose of erecting and operating additional structures
whose use is integrated with the use of the Mortgaged Property or resolving
encroachment issues, and (B) grant easements, restrictions, covenants,
reservations and rights of way for resolving minor encroachment issues or for
access, water and sewer lines, telephone and telegraph lines, electric lines or
other utilities or for other similar purposes, provided that no such Disposition
set forth in the foregoing clauses (A) and (B) shall materially impair the
value, utility or operation of the subject Mortgaged Property and, provided
further, that as a condition to the Administrative Agent’s consent to any such
Disposition set forth in clauses (A) and (B), Borrower or Leasehold Holder shall
demonstrate to Administrative Agent’s reasonable satisfaction that any such
Disposition and the related easements, restrictions, covenants, reservations and
rights of

 

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way or other similar grants are designed to and may be expected to enhance the
value, utility, operation and future development potential of the subject
Mortgaged Property, and to the extent Borrower or Leasehold Holder is paid or
becomes entitled to any payment or other compensation therewith with respect to
any such Disposition, such amount (less reasonable and customary costs and
expenses incurred in connection with such Disposition) shall be remitted by
Borrower or the Leasehold Holder to Administrative Agent for application against
the outstanding Obligations.  In connection with any Disposition permitted
pursuant to this Section 6.4(3)(iii), the Administrative Agent shall execute and
deliver any instrument reasonably necessary or appropriate, in the case of the
Dispositions referred to in clause (A) above, to release the portion of the
Mortgaged Property affected by such Disposition from the Lien of the Security
Instruments or, in the case of clause (B) above, to subordinate the Lien of such
Security Instruments to such easements, restrictions, covenants, reservations
and rights of way or other similar grants upon receipt by the Administrative
Agent of:

 

(W)         ten (10) days prior written notice thereof;

 

(X)          a copy of the instrument or instruments of Disposition;

 

(Y)           an Officer’s Certificate stating (1) with respect to any
Disposition, the consideration, if any, being paid for the Disposition and
(ii) that such Disposition does not materially impair the value, utility or
operation of the subject Mortgaged Property and otherwise satisfies the
foregoing conditions; and

 

(Z)           reimbursement of all of the Administrative Agent’s reasonable
costs and expenses incurred in connection with such Disposition.

 

6.5           Investments. No Loan Party shall directly or indirectly make or
maintain any Investment except Investments in cash and Cash Equivalents.

 

6.6           Transactions with Affiliates. Other than the HCF Management
Agreement, the Tax Sharing Agreement and the Expense Sharing Agreement, no Loan
Party shall directly or indirectly enter into or permit to exist any transaction
(including, without limitation, the purchase, sale, lease or exchange of any
property or the rendering of any service, but excluding any shared service
contracts, group purchasing contracts or other transactions in which the
combined purchasing power of any Loan Party and its Affiliates is used in the
negotiation and agreement with a person or entity that is not a Transactional
Affiliate) with (1) any Affiliate of any Loan Party; (2) a holder or holders of
more than five percent (5%) of any class of Capital Stock of PropCo, or its
constituent equity holders; or (3) with any Affiliate of the foregoing (each of
the foregoing, a “Transactional Affiliate”), except (y) as set forth on Schedule
6.6 or (z) upon (A) prior notice to Administrative Agent and (B) fair and
reasonable terms no less favorable to the Loan Parties than would be obtained in
a comparable arm’s-length transaction with a Person not a Transactional
Affiliate; provided that no such notice shall be required for any such
transaction in the Ordinary Course of Business of the Borrower or Leasehold
Holder.  Notwithstanding anything contained herein to the contrary Borrower and
Leasehold Holder shall be permitted to make and receive Permitted Distributions
to and from Holdco so long as the

 

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same is consistent with the Ordinary Course of Business of Borrower and/or
Leasehold Holder.

 

6.7           Modifications to Organizational Documents and Other Material
Agreements.  Each Loan Party shall not, and Borrower shall not permit any of the
other Borrower Parties to, Modify any of their respective Organizational
Documents or any Material Agreements, in each case without the Administrative
Agent’s prior written consent, other than (a) Modifications necessary to clarify
existing provisions of such Organizational Documents or Material Agreements; and
(b) Modifications which would have no adverse effect on the rights or interests
of Administrative Agent or Lenders in conjunction with the Loans or under the
Loan Documents and would not change in any material respect the rights and
obligations of the parties to such Organizational Documents or the Material
Agreements.

 

6.8           Restricted Payments.  Neither Borrower nor Leasehold Holder shall
make any Distributions except for Permitted Distributions.

 

6.9           Zoning Changes.  Without the prior written consent of
Administrative Agent (which in the case of clause (a) shall not be unreasonably
withheld), neither Borrower nor Leasehold Holder shall, nor shall it permit,
consent to or acquiesce to (a) any zoning reclassification of any portion of the
Mortgaged Property other than a zoning reclassification that would permit gaming
development on any portion of the Mortgaged Property upon which, prior to such
reclassification, gaming development would not have been permitted, (b) any
variance under any existing zoning ordinance that could result in the use of the
Mortgaged Property becoming a non-conforming use under any zoning ordinance or
any other applicable land use law, rule or regulation, or (c) allow any portion
of the Mortgaged Property to be used in any manner that could result in the use
of the Mortgaged Property becoming a non-conforming use under any zoning
ordinance or any other applicable land use law, rule or regulation

 

6.10         Sale Leaseback. Neither Borrower nor Leasehold Holder shall enter
into any sale and leaseback transaction covering any Real Property.

 

6.11         Negative Pledges.  No Loan Party shall enter into or suffer to
exist or become effective any agreement prohibiting or limiting the ability of
such Loan Parties to create, incur, assume or suffer to exist any Lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired, to
secure the Obligations, including any agreement requiring any other Indebtedness
or Contractual Obligation of the Loan Parties to be equally and ratably secured
with the Obligations (except as granted to Lenders herein).

 

6.12         Modifications.  Neither Borrower nor Leasehold Holder shall make
any alteration or other modification to any Improvement on any Real Property or
develop or construct any new Improvements on any Real Property, in an amount in
excess of $2,500,000, in each case without the prior written consent of
Administrative Agent, which consent Administrative Agent may withhold in its
sole and absolute discretion; provided, however, that in no event shall Borrower
or Leasehold Holder, as applicable, be permitted to demolish any Improvements on
any Real Property, regardless of the cost of such demolition, without the prior
written consent of Administrative Agent; and provided further that in no event
may Borrower or Leasehold Holder make any alteration or other modification to
any Improvement on any Real Property using revenues of any kind derived from the
Mortgaged Property or from any loan obtained by

 

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Borrower or Leasehold Holder, it being acknowledged and agreed that the cost of
completing alterations and modifications to the Improvements on the Real
Property are to come only from contributions made to Borrower or the Leasehold
Holder by Affiliates of Borrower or the Leasehold Holder that are permitted by
the Loan Documents and all contracts and other instruments to which Borrower or
the Leasehold Holder and such Affiliate are bound. Borrower and the Leasehold
Holder shall notify Administrative Agent if Borrower or Leasehold Holder
(x) receives any written notice from NDEP, the Department of Air Quality, the
State Fire Marshal, or any other Governmental Authority having jurisdiction over
any permitted demolition activities or the effects of such activities on the
environmental condition of the Mortgaged Property, including any removal from
the Mortgaged Property to an offsite facility of any removed underground storage
tank or contaminated soil, of the violation or alleged violation of NRS Chapter
444 (and, in the event of any violation arising under NRS Chapter 444, any lien
claim filed or recorded or any other written notice relating to any lien that
may be imposed on the Mortgaged Property or any portion thereof as a result of
such violation pursuant to NRS Section 444.520), NRS Chapters 445A or 445B, NRS
Sections 459.400 et seq., NRS Chapter 477 or NRS Chapter 618, or (y) files any
written application pursuant to NRS Section 459.634 to participate in the state
voluntary remediation Program (as defined in NRS Section 459.624) or pursuant to
Nevada Administrative Code Section 590.700 to obtain assistance in the cleanup
of soil contamination, to the extent Borrower or Leasehold Holder, as
applicable, is eligible to file any such application.

 

6.13         Interest Rate Contracts. Neither Borrower nor Leasehold Holder
shall enter into (or cause to be entered into) any Interest Rate Contract other
than the Required Interest Rate Contracts.

 

6.14         Limitation on Cage Cash.  Leasehold Holder covenants, warrants and
agrees that the aggregate amount of Cage Cash maintained by Leasehold Holder
(A) shall not exceed the amount of cash, determined by Leasehold Holder in its
reasonable business judgment consistent with past practice, desirable in the
Ordinary Course of Business of the Hotel/Casino Facility to be maintained in the
Hotel/Casino Facility and (B) shall not exceed $1,800,000.00 for any period of
five (5) consecutive Business Days.  In no event, however, shall the Cage Cash
be less than the amount required by the Gaming Authorities.

 

6.15         Subdivision.  Neither Borrower nor Leasehold Holder shall subdivide
(or permit, consent to or acquiesce in the subdivision of) any Mortgaged
Property without the prior written consent of Administrative Agent, which
consent shall not be unreasonably withheld, conditioned or delayed.

 

6.16         Prohibition on Borrower Gaming Activity.  For so long as the Loan
is outstanding, without the prior written consent of Administrative Agent,
Borrower shall not engage in any business or activity that would require
Borrower to obtain or hold a Gaming Permit.

 

ARTICLE VII

EVENTS OF DEFAULT

 

7.1           Event of Default.  Each of the following shall constitute an event
of default under this Agreement (an “Event of Default”):

 

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(1)           The Borrower fails to pay, whether at the due date thereon or at a
date fixed for prepayment thereof or by acceleration thereof or otherwise
(i) when and as required to be paid herein, any amount of principal or interest
on the Loans (including, without limitation, any mandatory prepayment of the
Loans under Section 2.5(1) or the repayment of the Loans in full and all
interest accrued thereon on the Maturity Date), or (ii) within five (5) days
after the same becomes due, any other Obligation;

 

(2)           Any representation or warranty made or deemed made by any Borrower
Party in any Loan Document or by any Borrower Party (or any of its officers) in
connection with any Loan Document shall prove to have been incorrect in any
material respect when made or deemed made;

 

(3)           Any of the Loan Parties shall default in the observance or
performance of any covenant or agreement contained in Article VI;

 

(4)           Any Borrower Party shall fail to perform or observe any term,
covenant or agreement contained in this Agreement or in any other Loan Document
(other than those that are otherwise the subject of an Event of Default under
this Section 7.1), if such failure shall remain unremedied for 30 days after the
date on which written notice thereof shall have been given to the Borrower by
the Administrative Agent;

 

(5)           Any Loan Party shall fail to make any payment on any other
Indebtedness (other than the Obligations), and in each such case, such failure
relates to Indebtedness having a principal amount of $1,000,000 or more, when
the same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise); or (ii) any other event shall
occur or condition shall exist under any agreement or instrument relating to any
Indebtedness of the Loan Party having a principal amount of $1,000,000 or more,
if the effect of such event or condition is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness; or (iii) any Indebtedness of
the Loan Party having a principal amount of $1,000,000 or more shall become or
be declared to be due and payable, or required to be prepaid or repurchased
(other than by a regularly scheduled required prepayment), prior to the stated
maturity thereof;

 

(6)           (i) if any Borrower Party shall generally not pay its debts as
such debts become due, shall admit in writing its inability to pay its debts
generally, (ii) if any Borrower Party shall make a general assignment for the
benefit of creditors, (iii) if any proceeding shall be instituted by or against
any Borrower Party seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts under any Requirement of Law relating
to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a custodian, receiver,
trustee or other similar official for it or for any substantial part of its
property; provided, however, in the case of any such proceedings instituted
against a Borrower Party (but not instituted by any Borrower Party), either such
proceedings shall remain undismissed or unstayed for a period of sixty (60) days
or any of the actions sought in such proceedings shall occur, or (iv) any
Borrower Party shall take any corporate, partnership or company action to
authorize any of the actions set forth above in clauses (i), (ii) and (iii) of
this Section 7.1(6);

 

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(7)           Any final judgment or order (or other similar process) involving,
in any single case or in the aggregate, an amount in excess of $2,500,000 in the
case of a money judgment, to the extent not covered by insurance, or that could
reasonably be expected to have a Material Adverse Effect or a Property Material
Adverse Effect, in the case of a non-monetary judgment, shall be rendered
against a Loan Party by a court having jurisdiction, and such judgment or order
shall continue unsatisfied and in effect for a period of thirty (30) days
without being vacated, discharged, satisfied, or stayed or bonded pending
appeal; or there is entered against Recourse Guarantor a final judgment or order
for the payment of money in an aggregate amount exceeding $15,000,000.00 (to the
extent not covered by independent third-party insurance as to which the insurer
has been notified of such judgment or order and has not denied coverage) and
such judgment or order shall not have been satisfied, vacated, discharged or
stayed or bonded pending an appeal for a period of sixty (60) consecutive days;

 

(8)           (i) An ERISA Event shall occur and the amount of all liabilities
and deficiencies resulting therefrom, together with all other ERISA Events, that
are or are reasonably likely to be imposed on the Borrower, Leasehold Holder or
any ERISA Affiliate, whether or not assessed, exceeds $1,000,000 in the
aggregate, (ii) the commencement or increase of contributions to, or the
adoption of or the amendment of a Pension Plan by Borrower, Leasehold Holder or
an ERISA Affiliate which has resulted or could reasonably be expected to result
in an increase in Unfunded Pension Liability among all Pension Plans in an
aggregate amount in excess of $1,000,000 or (iii) any of Borrower Parties or an
ERISA Affiliate shall fail to pay when due, after the expiration of any
applicable grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan, which has
resulted or could reasonably be expected to result in a Material Adverse Effect;

 

(9)           Recourse Guarantor shall attempt to rescind or revoke the Recourse
Guaranty, with respect to future transactions or otherwise, or shall fail to
make any payment as and when required in accordance with the terms of the
Recourse Guaranty, or any Payment Guarantor shall attempt to rescind or revoke
the Payment Guaranty, with respect to future transactions or otherwise, or shall
fail to make any payment as and when required in accordance with the terms of
the Payment Guaranty;

 

(10)         The occurrence of a License Revocation (after giving effect to any
applicable cure period expressly set forth in the definition of “License
Revocation”) that continues for more than five (5) consecutive Business Days
during which time enforcement is not stayed by appeal or similar proceeding with
the applicable Gaming Authority;

 

(11)         Borrower or Leasehold Holder ceases to operate a hotel and casino
on the Ground Lease Parcel or ceases to conduct gaming activities thereon at
substantially the same level as conducted as of the Effective Date for any
reason whatsoever (other than temporary cessation in connection with alterations
permitted hereunder or restoration following a Casualty or Condemnation);

 

(12)         Any Event of Default shall occur under any of the other Loan
Documents;

 

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(13)         There shall occur a Change of Control, except as expressly
permitted by Section 6.4(1) hereof;

 

(14)         Borrower or Leasehold Holder shall have entered into one or more
consent or settlement decrees or agreements or similar arrangements with a
Governmental Authority or one or more judgments, orders, decrees or similar
actions shall have been entered against Borrower or Leasehold Holder based on or
arising from the violation of or pursuant to any Hazardous Materials Laws, or
the generation, storage, transportation, treatment, disposal or release of any
Contaminant and, in connection with all the foregoing, the Borrower or Leasehold
Holder is likely to incur uninsured environmental liabilities and costs in
excess of $2,500,000 in the aggregate;

 

(15)         If there shall occur any default by Leasehold Holder, as lessee
under the Ground Lease, in the observance or performance of any term, covenant
or condition of the Ground Lease on the part of Leasehold Holder to be observed
or performed, and said default is not cured prior to the expiration of any
applicable grace or cure period therein provided, or if any one or more of the
events referred to in the Ground Lease shall occur which would cause the Ground
Lease to terminate without notice or action by the Ground Lease Fee Owner under
the Ground Lease or if the Leasehold Estate shall be surrendered or the Ground
Lease shall be lawfully terminated or cancelled for any reason or under any
circumstances whatsoever (other than in connection with the purchase of the fee
interest in the Ground Lease Parcel by Borrower in accordance with the terms of
this Agreement), or if any of the terms, covenants or conditions of the Ground
Lease shall in any manner be modified, changed, supplemented, altered or amended
in contradiction of the provisions of Section 5.18 without the prior written
consent of Administrative Agent, or if Leasehold Holder shall fail to exercise
any option to renew the Ground Lease or shall fail to or neglect to pursue
diligently all actions necessary to exercise such renewal rights pursuant to the
terms of the Ground Lease (unless the Administrative Agent agrees in writing
that Leasehold Holder shall not be obligated to exercise such renewal option),
or if Borrower or Leasehold Holder shall exercise the Ground Lease Parcel
Purchase Option or acquire the Ground Lease Parcel in contradiction to the
provisions of Section 5.18;

 

(16)         Borrower shall surrender, terminate or cancel (or consent to or
acquiesce in any surrender, termination or cancellation of) the Option
Agreement; or any Modification of the Option Agreement in violation of the
provisions of Section 5.20; or Borrower shall exercise the Option Parcels
Purchase Option or acquire any of the Option Parcels without the prior written
consent of the Administrative Agent, except as expressly permitted pursuant to
Section 5.20; or if any of the Borrower Parties shall default in the observance
or performance of any other covenant or agreement contained in Section 5.20
which remains uncured for fifteen (15) days after written notice from the
Administrative Agent;

 

(17)         If the Option Agreement shall be terminated or cancelled for any
reason or under any circumstances whatsoever (other than in connection with the
purchase of the fee interest in the Option Parcels by Borrower in accordance
with the terms of this Agreement), or if any of the terms, covenants or
conditions of the Option Agreement shall in any manner be modified, changed,
supplemented, altered or amended in contradiction of the provisions of

 

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Section 5.20 without the prior written consent of Administrative Agent, or if
Borrower shall exercise the Option Parcels Purchase Option or acquire any Option
Parcels in contradiction to the provisions of Section 5.20;

 

(18)         The HCF Management Agreement shall, in whole or in part, be
terminated, cease to be effective or cease to be the legally valid, binding and
enforceable obligation in any material respect of any party thereto; or

 

(19)         (i) Any Security Instrument (or other Collateral Document) after
delivery thereof pursuant to Section 3.1 shall for any reason (other than
pursuant to the terms thereof) cease to create a valid and perfected Lien, with
the priority required by the Security Instruments (or other Collateral
Documents), (or other security purported to be created on the applicable
Mortgaged Property or Collateral) on and security interest in any material
portion of the Mortgaged Property or Collateral purported to be covered thereby,
subject to Permitted Encumbrances, except to the extent that any such loss of
perfection or priority results from the failure of the Administrative Agent to
maintain possession of certificates actually delivered to it representing
securities pledged under the Collateral Documents or to file Uniform Commercial
Code continuation statements (so long as such failure does not result from the
breach or non-compliance by a Borrower Party with the terms of any Loan
Document), or (ii) any of the Capital Stock of the Borrower or Leasehold Holder
ceases to be pledged pursuant to the applicable Collateral Documents free of
Liens other than Liens created by the Security Instruments or other Collateral
Documents and Permitted Encumbrances.

 

7.2           Remedies.

 

(1)           If any Event of Default shall occur and be continuing, the
Administrative Agent may (or at the direction of the Required Lenders shall):
(i) declare the outstanding principal balance of the Loans and interest accrued
but unpaid thereon and all other Obligations immediately due and payable,
without demand upon or presentment to any of the Borrower Parties, which are
expressly waived by the Borrower Parties; (ii) exercise, on behalf of the
Secured Parties, all rights and remedies under the Recourse Guaranty, the
Payment Guaranty, the Pledge Agreement, the Security Agreement, the Assignment
of Interest Rate Contract (if any), the Assignment of Contracts, the Security
Instruments and any other Collateral Documents entered into with respect to the
Loans; (iii) exercise the rights of the Administrative Agent under the Control
Agreements to transfer funds maintained in the Accounts of the Loan Parties to
such account as the Administrative Agent may determine; and (iv) immediately
exercise all rights, powers and remedies available at law, in equity or
otherwise, including, without limitation, under the other Loan Documents, all of
which rights, powers and remedies are cumulative and not exclusive; provided,
however, that upon the occurrence of any of the Events of Default specified in
Sections 7.1(6)(ii) and 7.1(6)(iii), the Loans, all such interest and all such
amounts and Obligations shall automatically become and be due and payable,
without presentment, demand, protest or any notice of any kind, all of which are
hereby expressly waived by the Borrower.

 

(2)           Nothing contained herein or in any other Loan Document shall be
construed as requiring the Administrative Agent to resort to the Collateral for
the satisfaction of any of the Obligations, and, the Administrative Agent may
seek satisfaction out of the

 

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Collateral or any part thereof, in its absolute discretion in respect of the
Obligations.  In addition, the Administrative Agent shall have the right from
time to time to partially foreclose this Agreement and the Collateral Documents
in any manner and for any amounts secured by this Agreement or the Collateral
Documents then due and payable as determined by the Administrative Agent in its
sole discretion; provided, however, that the Administrative Agent shall issue a
“Notice of Exclusive Control” pursuant to the Control Agreement with respect to
the Accounts only upon the occurrence and during the continuance of an Event of
Default.  Notwithstanding one or more partial foreclosures, the Collateral shall
remain subject to this Agreement and the Collateral Documents to secure payment
of sums secured by this Agreement and the Collateral Documents and not
previously recovered.

 

7.3                                 Ground Lease Parcel Purchase Option and
Option Agreement.  In addition to all other rights and remedies provided under
the this Agreement, under the Loan Documents, as well as remedies as may be
available at law and in equity, upon the occurrence and during the continuance
of an Event of Default:

 

(a)                                  The Administrative Agent may, in its sole
discretion: (i) to the extent permitted by the terms of the Option Agreement or
as otherwise agreed upon between Administrative Agent and Option Parcels Fee
Owner, in connection with its exercise of remedies under the Loan Documents,
exercise the Option Parcels Purchase Option and complete the purchase of one or
more Option Parcels and any funds paid by the Administrative Agent to pay any
escrow deposit required under the Option Agreement, the purchase price of the
Option Parcels so purchased and any closing costs required to be paid by
Borrower under the Option Agreement shall be deemed to constitute a protective
advance by the Administrative Agent, shall bear interest at the interest rate
applicable to Base Rate Loans and shall be reimbursed by the Borrower at the
time of any sale of the Option Parcels from the sale proceeds thereof (provided,
that, for the avoidance of doubt, in no event shall Borrower be entitled to any
reimbursement from the Administrative Agent or the Lenders for any portion of
the Option Consideration (as defined in the Option Agreement), or any other
amounts paid to the Option Parcels Fee Owner under or in connection with the
Option Agreement)), and (ii) to the extent permitted by the terms of the Ground
Lease or as otherwise agreed upon between Administrative Agent and Ground Lease
Fee Owner, in connection with its exercise of remedies under the Loan Documents,
exercise the Ground Lease Parcel Purchase Option and complete the purchase of
the Ground Lease Parcel and funds paid by the Administrative Agent to pay the
purchase price of the Ground Lease Parcel, and any closing costs required to be
paid by Borrower and/or Leasehold Holder shall be deemed to constitute a
protective advance by the Administrative Agent, shall bear interest at the
interest rate applicable to Base Rate Loans and shall be reimbursed by the
Borrower at the time of any sale of the Ground Lease Parcel from the sale
proceeds thereof (provided, that for the avoidance of doubt, in no event shall
Borrower be entitled to any reimbursement from the Administrative Agent or the
Lenders for any portion of any amounts which are paid by the Borrower or the
Leasehold Holder under or in connection with the Ground Lease Parcel Purchase
Option).  In addition, in connection with the exercise of its rights hereunder,
the Administrative Agent may, in its sole determination, acquire title to one or
more of the Options Parcels and the Ground Lease Parcel in the name of the
Administrative Agent, its designee or in the name of and on behalf of Borrower
or Leasehold Holder.  Borrower and Leasehold Holder each hereby appoints the
Administrative Agent as its attorney-in-fact, which power of attorney is coupled
with an interest, with full authority, in the name of Borrower and

 

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Leasehold Holder, after the occurrence and during the continuance of any Event
of Default, to take any action and to execute any instrument in the name of
Borrower and Leasehold Holder to accomplish the purpose of the provisions of
this Section 7.3(a).

 

(b)                                 The Administrative Agent may, in connection
with its exercise of remedies under the Loan Documents, file, or cause to be
filed, an action or complaint for specific performance (i) against Borrower, to
cause Borrower to (A) exercise the Options Parcels Purchase Option with respect
to one or more Option Parcels and (B) provided that any funds paid by the
Administrative Agent to pay any escrow deposit required under the Option
Agreement, the purchase price of the Option Parcels so purchased and any closing
costs required to be paid by Borrower under the Option Agreement shall be deemed
to constitute a protective advance by the Administrative Agent, shall bear
interest at the interest rate applicable to Base Rate Loans and shall be
reimbursed by the Borrower at the time of any sale of the Option Parcels from
the sale proceeds thereof (provided, in no event shall Borrower be entitled to
any reimbursement for all or any portion of the Option Consideration, or any
amounts paid to Option Parcels Fee Owner which are not required pursuant to the
terms of the Option Agreement), acquire one or more of the Option Parcels, as
determined by the Administrative Agent in its sole discretion, and
simultaneously therewith, convey the Option Parcel(s) so acquired to the
Administrative Agent or its designee or nominee, and/or (ii) against Borrower
and/or Leasehold Holder cause Borrower and/or Leasehold Holder to (A) exercise
the Ground Lease Parcel Purchase Option, and (B) provided that any funds paid by
the Administrative Agent to pay the purchase price of the Ground Lease Parcel,
and any closing costs required to be paid by Borrower and/or Leasehold Holder
shall be deemed to constitute a protective advance by the Administrative Agent,
shall bear interest at the interest rate applicable to Base Rate Loans and shall
be shall be reimbursed by the Borrower at the time of any sale of the Ground
Lease Parcel from the sale proceeds thereof (provided, in no event shall
Borrower or Leasehold Holder be entitled to any reimbursement for any amounts
paid to Ground Lease Fee Owner which are not required pursuant to the terms of
the Ground Lease Parcel Purchase Option), acquire the Ground Lease Parcel and
simultaneously therewith convey the Ground Lease Parcel to the Administrative
Agent or its designee.

 

ARTICLE VIII
THE ADMINISTRATIVE AGENT

 

8.1                                 Appointment.  Each Lender hereby irrevocably
designates and appoints the Administrative Agent as the agent of such Lender
under the Loan Documents and each such Lender hereby irrevocably authorizes the
Administrative Agent, as the agent for such Lender, to take such action on its
behalf under the provisions of the Loan Documents and to exercise such powers
and perform such duties as are expressly delegated to the Administrative Agent
by the terms of the Loan Documents, together with such other powers as are
reasonably incidental thereto.  Notwithstanding any provision to the contrary
elsewhere in the Loan Documents, the Administrative Agent shall not have any
duties or responsibilities, except those expressly set forth herein or therein,
or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into the Loan Documents or otherwise exist against the Administrative Agent.

 

8.2                                 Delegation of Duties.  The Administrative
Agent may execute any of its duties

 

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under the Loan Documents by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties. 
With respect to the Lenders, the Administrative Agent shall not be responsible
for the negligence or misconduct of any agents or attorneys-in-fact selected by
it with reasonable care.

 

8.3                                 Exculpatory Provisions.  None of the
Administrative Agent, the other Agents, nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates shall be
(1) liable to the Lenders for any action lawfully taken or omitted to be taken
by it or such Person under or in connection with the Loan Documents (except for
its or such Person’s own gross negligence or willful misconduct), or
(2) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by the Borrower Parties or any
officer thereof contained in the Loan Documents or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with the Loan Documents or for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
the Loan Documents or for any failure of the Borrower Parties to perform their
obligations hereunder or thereunder.  The Administrative Agent and the other
Agents shall not be under any obligation to any Lender to ascertain or to
inquire as to the observance or performance of any of the agreements contained
in, or conditions of, the Loan Documents or to inspect the properties, books or
records of the Borrower Parties.

 

8.4                                 Reliance by the Agents.  Each of the Agents
shall be entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, consent, certification, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order or
other document or conversation reasonably 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 (including, without limitation,
counsel to any Borrower Party), independent accountants and other experts
selected by such Agent.  As to the Lenders:  (1) the Administrative Agent shall
be fully justified in failing or refusing to take any action under the Loan
Documents unless it shall first receive such advice or concurrence of one
hundred percent (100%) of the Lenders (or, if a provision of this Agreement
expressly provides that a lesser number of the Lenders may direct the action of
the Administrative Agent, such lesser number of Lenders) or it shall first be
indemnified to its satisfaction by the Lenders ratably in accordance with their
respective Pro Rata Shares against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any action (except
for liabilities and expenses resulting from the Administrative Agent’s gross
negligence or willful misconduct), and (2) the Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, under the Loan
Documents in accordance with a request of one hundred percent (100%) of the
Lenders (or, if a provision of this Agreement expressly provides that the
Administrative Agent shall be required to act or refrain from acting at the
request of a lesser number of the Lenders, such lesser number of Lenders), and
such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders.

 

8.5                                 Notice of Default.  The Administrative Agent
shall not be deemed to have knowledge or notice of the occurrence of any
Potential Default or Event of Default hereunder unless the Administrative Agent
has received written notice from a Lender or the Borrower referring to the Loan
Documents, describing such Potential Default or Event of Default and stating
that such notice is a “notice of default.”  In the event that the Administrative
Agent

 

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receives such a notice and a Potential Default or Event of Default has occurred,
the Administrative Agent shall promptly give notice thereof to the Lenders.  The
Administrative Agent shall take such action with respect to such Potential
Default or Event of Default as shall be reasonably directed by the Required
Lenders; provided that, unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Potential Default or Event of Default as it shall deem advisable in the
best interest of the Lenders (except to the extent that this Agreement, the
Pledge Agreement, the Assignment of Interest Rate Contract (if any), the
Assignment of Contracts, or the Recourse Guaranty expressly require that such
action be taken or not taken by the Administrative Agent with the consent or
upon the authorization of the Required Lenders or such other group of Lenders,
in which case such action will be taken or not taken as directed by the Required
Lenders or such other group of Lenders or Lenders).

 

8.6                                 Non-Reliance on Agents and Other Lenders. 
Each Lender expressly acknowledges that none of the Administrative Agent, the
other Agents nor any of their respective officers, directors, employees, agents,
attorneys-in-fact or affiliates has made any representations or warranties to it
and that no act by the Administrative Agent or the other Agents hereinafter
taken, including any review of the affairs of the Borrower Parties, shall be
deemed to constitute any representation or warranty by the Administrative Agent
or the other Agents to any Lender.  Each Lender represents to the Administrative
Agent and the other Agents that it has, independently and without reliance upon
the Administrative Agent, the other Agents or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower Parties and
made its own decision to make its loans hereunder and enter into this
Agreement.  Each Lender also represents that it will, independently and without
reliance upon the Administrative Agent, the other Agents 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 analysis, appraisals and decisions in
taking or not taking action under this Agreement, and to make such investigation
as it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower Parties. 
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Administrative Agent hereunder, the
Administrative Agent and the other Agents shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, financial and other condition or
creditworthiness of the Borrower Parties which may come into the possession of
the Administrative Agent or any other Agent or any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates.

 

8.7                                 Indemnification.  The Lenders agree to
indemnify the Administrative Agent and the other Agents in their respective
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to the
respective amounts of their Pro Rata Shares, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following the payment of the
Obligations) be imposed on, incurred by or asserted against the Administrative
Agent or the other Agents in any way relating to or arising out of the Loan
Documents or any

 

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documents contemplated by or referred to herein or the transactions contemplated
hereby or any action taken or omitted by the Administrative Agent or the other
Agents under or in connection with any of the foregoing; provided that no Lender
shall be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the Administrative Agent’s or any other Agent’s
gross negligence or willful misconduct, respectively.  The provisions of this
Section 8.7 shall survive the payment of the Obligations and the termination of
this Agreement.

 

8.8                                 Agents in Their Individual Capacity.  The
Administrative Agent, the other Agents and their affiliates may make loans to,
accept deposits from and generally engage in any kind of business with any of
the Borrower Parties or any of their respective Subsidiary Entities and
Affiliates as though the Administrative Agent and the other Agents were not,
respectively, the Administrative Agent, the Joint Lead Arranger or an Agent
hereunder.  With respect to such loans made or renewed by them and any Note
issued to them, the Administrative Agent and the other Agents shall have the
same rights and powers under the Loan Documents as any Lender and may exercise
the same as though it were not the Administrative Agent, the Joint Lead Arranger
or an Agent, respectively, and the terms “Lender” and “Lenders” shall include
the Administrative Agent, the Joint Lead Arrangers and each other Agent in its
individual capacity.

 

8.9                                 Successor Administrative Agent.  The
Administrative Agent may resign as Administrative Agent under the Loan Documents
upon thirty (30) days’ notice to the Lenders.  If the Administrative Agent shall
resign, then the Lenders (other than the Lender resigning as Administrative
Agent) shall (with, so long as there shall not exist and be continuing an Event
of Default, the consent of the Borrower, such consent not to be unreasonably
withheld or delayed) appoint a successor agent or, if the Lenders are unable to
agree on the appointment of a successor agent, the Administrative Agent shall
appoint a successor agent for the Lenders whereupon such successor agent shall
succeed to the rights, powers and duties of the Administrative Agent, and the
term “Administrative Agent” shall mean such successor agent effective upon its
appointment, and the former Administrative Agent’s rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any of the Loan Documents or successors thereto.  After any
retiring Administrative Agent’s resignation hereunder as Administrative Agent,
the provisions of the Loan Documents shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent
under the Loan Documents.

 

8.10                           Limitations on Agents Liability.  The Lead
Arranger, in such capacity, shall not have any right, power, obligation,
liability, responsibility or duty under this Agreement or the other Loan
Documents.

 

8.11                           Collateral.  Each Secured Party, by its
acceptance of the benefits of the Loan Documents, agrees that it shall have no
right individually to realize upon any of the Collateral hereunder, it being
understood and agreed by such Secured Party that all rights and remedies
hereunder may be exercised solely by the Administrative Agent for the benefit of
Secured Parties in accordance with the terms of this Agreement, the Collateral
Documents and the other Loan Documents.

 

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ARTICLE IX
EXCULPATION

 

9.1                                 Exculpated Parties.  Except as set forth in
this Article IX and Article XI hereof, no personal liability shall be asserted,
sought or obtained by Administrative Agent or any Lender or enforceable against
(i) any Affiliate of Borrower, (ii) any Person owning, directly or indirectly,
any legal or beneficial interest in Borrower or any Affiliate of Borrower or
(iii) any direct or indirect partner, member, principal, officer, Controlling
Person, beneficiary, trustee, advisor, shareholder, employee, agent, Affiliate
or director of any Persons described in clauses (i) and (ii) above
(collectively, the “Exculpated Parties”) and none of the Exculpated Parties
shall have any personal liability (whether by suit, deficiency judgment or
otherwise) in respect of the Obligations, this Agreement, the Collateral
Documents, the Note, the Mortgaged Property or any other Loan Document, or the
making, issuance or transfer thereof, all such liability, if any, being
expressly waived by Administrative Agent and the Lenders.  The foregoing
limitation shall not in any way limit or affect Administrative Agent’s or any
Lender’s right to any of the following and neither Administrative Agent nor any
Lender shall be deemed to have waived any of the following:

 

(a)                                              Full recourse against Borrower;

 

(b)                                             Foreclosure or enforcement of
the Lien of this Agreement, the Security Instruments and the other Collateral
Documents in accordance with the terms and provisions set forth herein, in the
Security Instruments and the other Collateral Documents;

 

(c)                                              Action against any other
security at any time given to secure the payment of the Notes and the other
Obligations;

 

(d)                                             Exercise of any other remedy set
forth in this Agreement or in any other Loan Document which is not inconsistent
with the terms of this Article IX;

 

(e)                                              Any right which Administrative
Agent or the Lenders may have under Sections 506(a), 506(b), 1111(b) or any
other provisions of the Bankruptcy Code to file a claim for the full amount of
the Obligations secured by this Agreement and the Collateral Documents or to
require that all Collateral shall continue to secure all of the Obligations
owing to Lenders in accordance with the Loan Documents; or

 

(f)                                                The liability of any given
Exculpated Party with respect to any separate written guaranty, instrument or
agreement given by any such Exculpated Party in connection with the Loans,
including, without limitation, the Payment Guaranty, the Recourse Guaranty, the
Security Instruments, the Security Agreement, the Control Agreements and the
Pledge Agreement.

 

9.2                                 Carveouts From Non-Recourse Limitations. 
Notwithstanding the foregoing or anything in this Agreement or any of the Loan
Documents to the contrary, there shall at no time be any limitation on
Borrower’s or any Recourse Guarantor’s liability for the payment, in accordance
with the terms of this Agreement, the Note, the Collateral Documents and the
other Loan Documents and the Specified Interest Rate Contracts, to
Administrative Agent and the Secured Parties of:

 

(a)                                              any loss, damage, cost or
expense incurred or suffered by the Secured Parties by

 

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reason of (i) any termination, cancellation, rejection, surrender, amendment,
modification or subordination of the Ground Lease (or any portion thereof) or
the Option Agreement, in each instance without Administrative Agent’s prior
consent, or (ii) any breach of the representations set forth in Sections 4.29 or
4.31 or any covenant set forth in Sections 5.18 or 5.20 (provided that the
provisions of this Section 9.2(a) shall exclude, and Recourse Guarantor shall
not have any liability for, any loss, damage, cost or expense incurred or
suffered by the Secured Parties solely by reason of (A) any accelerated rent or
damages payable to the Ground Lease Fee Owner by reason of a default under any
Ground Lease, or (B) Borrower’s or Leasehold Holder’s failure to pay the
purchase option price payable in connection with the exercise of any Ground
Lease Parcel Purchase Option or the purchase of any Option Parcels pursuant to
the Option Agreement);

 

(b)                                             any loss, damage, cost or
expense incurred by or on behalf of the Secured Parties by reason of the
fraudulent acts of any Loan Party or any Affiliate thereof;

 

(c)                                              Proceeds which a Loan Party or
any Affiliate thereof has received and to which Administrative Agent and/or the
Secured Parties are entitled pursuant to the terms of this Agreement or any of
the Loan Documents or the Specified Interest Rate Contracts to the extent the
same have not been applied toward payment of the Obligations, or used for the
repair or replacement of the Mortgaged Property in accordance with the
provisions of this Agreement;

 

(d)                                             all loss, damage, cost or
expense as incurred by Administrative Agent and/or the Secured Parties and
arising from any intentional misrepresentation of any Loan Party or any
Affiliate thereof;

 

(e)                                              any misappropriation of Rents
or other funds relating to the Mortgaged Properties by any Loan Party or any of
their Affiliates;

 

(f)                                    any loss, damage, cost or expense
incurred by or on behalf of the Secured Parties by reason of all or any part of
the Mortgaged Property, the Collateral or the Rate Contract Collateral being
encumbered by a Lien or Transferred by reason of the acts of any Loan Party or
any Affiliate thereof from and after the Effective Date (other than this
Agreement and the Collateral Documents) in violation of the Loan Documents;

 

(g)                                 after the occurrence and during the
continuance of an Event of Default, any rents, issues, profits and/or income
from the Mortgaged Property collected by Borrower, the Leasehold Holder or any
Affiliate thereof (other than rent paid directly to Administrative Agent
pursuant to any notice of direction delivered to tenants of the Mortgaged
Property) and not applied to payment of the Obligations or used to pay normal
and verifiable operating expenses of the Mortgaged Property or otherwise applied
in a manner permitted under the Loan Documents;

 

(h)                                 any loss, damage, cost or expense incurred
by or on behalf of the Secured Parties by reason of physical damage to the
Mortgaged Property from intentional waste or other willful destruction committed
by Borrower, the Leasehold Holder or any Affiliate thereof;

 

(i)                                     intentionally omitted;

 

(j)                                     any loss, damage, cost or expense
incurred by or on behalf of the Secured Parties

 

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by reason of any breach of a representation set forth in Section 4.23 or any
covenant set forth in Section 5.13;

 

(k)                                  all of the Obligations in the event of:
(i) any Borrower Party filing a voluntary petition under the Bankruptcy Code or
any other Federal or state bankruptcy or insolvency law; (ii) any Borrower Party
filing an answer consenting to or otherwise acquiescing in or joining in any
involuntary petition filed against it, by any other Person under the Bankruptcy
Code or any other Federal or state bankruptcy or insolvency law, or soliciting
or causing to be solicited, or colluding with (or any of such Borrower Party’s
Affiliates colluding with) petitioning creditors to file any such involuntary
petition from any Person; (iii) any Borrower Party consenting to or acquiescing
in or joining in an application for the appointment of a custodian, receiver,
trustee, or examiner for any Borrower Party or any portion of the Collateral;
(iv) any Borrower Party making an assignment for the benefit of creditors, or
admitting in writing in any legal proceeding described in (k)(i) through
(k)(iv) that it is insolvent;

 

(l)                                     any and all liabilities, obligations,
losses, damages, costs and expenses (including, without limitation, reasonable
attorneys’ fees, causes of action, suits, claims, demands and adjustments of any
nature or description whatsoever) which may at any time be imposed upon,
incurred by or awarded against Administrative Agent and/or the Secured Parties,
in the event (and arising out of such circumstances) that Borrower, Leasehold
Holder or Holdco should raise any defense, counterclaim and/or allegation in any
foreclosure action by Administrative Agent relative to the Collateral or the
Rate Contract Collateral or any part thereof which is found by a court to have
been raised by such Loan Party in bad faith or to be without basis in fact or
law; or

 

(m)                               reasonable attorney’s fees and expenses
actually incurred by Administrative Agent and/or the Secured Parties in
connection with any successful suit or other action filed or commenced on
account of any of the foregoing clauses (a) through (l).

 

ARTICLE X
MISCELLANEOUS PROVISIONS

 

10.1                           No Assignment by Borrower.  None of the Borrower
Parties may assign its rights or obligations under this Agreement or the other
Loan Documents without the prior written consent of the Administrative Agent and
one hundred percent (100%) of the Lenders.  Subject to the foregoing, all
provisions contained in this Agreement and the other Loan Documents and in any
document or agreement referred to herein or therein or relating hereto or
thereto shall inure to the benefit of the Administrative Agent and each Lender,
their respective successors and assigns, and shall be binding upon each of the
Borrower Parties and such Person’s successors and assigns.

 

10.2                           Modification.

 

(1)                                  Neither this Agreement nor any other Loan
Document may be Modified or waived unless such Modification or waiver is in
writing and signed by the Administrative Agent and the Borrower and, except for
the Modifications and waivers requiring consent of one hundred percent (100%) of
the Lenders referred to below, the Required Lenders, and, with respect to
Modifications and waivers that would have the effect of altering the ratable

 

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treatment of Obligations arising under the Loan Documents and Obligations
arising under Specified Interest Rate Contracts or the definition of “Interest
Rate Contract,” “Obligations,” “Secured Party” or “Specified Interest Rate
Contract,” in each case in a manner adverse to any Counterparty to a Specified
Interest Rate Contracts with Obligations then outstanding without the written
consent of any such Counterparty.  No such Modification or waiver shall, without
the prior written consent of one hundred percent (100%) of the Lenders: 
(i) reduce the principal of, or rate of interest on, the Loans or fees payable
to the Lenders hereunder, (ii) except as expressly contemplated by Section 10.8
below, modify the Pro Rata Share of any Lender, (iii) Modify the definition of
“Required Lenders,” (iv) extend or waive any scheduled payment date for any
principal, interest or fees, (v) release the Recourse Guarantor from its
obligations under the Recourse Guaranty, release any Payment Guarantor from its
obligations under the Payment Guaranty, release Borrower from its obligation to
repay the Loans, release Pledgor under the Pledge Agreement or release any
portion of the Collateral pledged under the Pledge Agreement, (vi) Modify this
Section 10.2, or (vii) Modify any provision of the Loan Documents which by its
terms requires the consent or approval of one hundred percent (100%) of the
Lenders.

 

(2)                                  It is expressly agreed and understood that
the election by the Required Lenders to accelerate amounts outstanding hereunder
and/or to terminate the obligation of the Lenders to make Loans hereunder shall
not constitute a Modification or waiver of any term or provision of this
Agreement or any other Loan Document.  No Modification of any provision of the
Loan Documents relating to the Administrative Agent shall be effective without
the written consent of the Administrative Agent.

 

10.3                           Cumulative Rights; No Waiver.  The rights, powers
and remedies of the Administrative Agent and the Lenders hereunder and under the
other Loan Documents are cumulative and in addition to all rights, power and
remedies provided under any and all agreements among the Borrower Parties, the
Administrative Agent and the Lenders relating hereto, at law, in equity or
otherwise.  Any delay or failure by Administrative Agent and the Lenders to
exercise any right, power or remedy shall not constitute a waiver thereof by the
Administrative Agent or the Lenders, and no single or partial exercise by the
Administrative Agent or the Lenders of any right, power or remedy shall preclude
other or further exercise thereof or any exercise of any other rights, powers or
remedies.

 

10.4                           Entire Agreement.  This Agreement, the other Loan
Documents and the schedules, appendices, documents and agreements referred to
herein and therein embody the entire agreement and understanding between the
parties hereto and supersede all prior agreements and understandings relating to
the subject matter hereof and thereof.

 

10.5                           Survival.  All representations, warranties,
covenants and agreements contained in this Agreement and the other Loan
Documents on the part of the Borrower Parties shall survive the termination of
this Agreement and shall be effective until the Obligations are paid and
performed in full or longer as expressly provided herein.

 

10.6                           Notices.  All notices given by any party to the
others under this Agreement and the other Loan Documents shall be in writing
unless otherwise provided for herein, and any such notice shall become effective
(1) upon personal delivery thereof, including, but not limited to,

 

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delivery by overnight mail and courier service, (2) three (3) Business Days
after it shall have been mailed by United States mail, first class, certified or
registered, with postage prepaid, or (3) in the case of notice by a
telecommunications device, when properly transmitted, in each case addressed to
the party at the address set forth on Schedule 10.6 attached hereto.  Any party
may change the address to which notices are to be sent by notice of such change
to each other party given as provided herein.

 

10.7                           Governing Law.  This Agreement and the other Loan
Documents, except as otherwise expressly provided therein, shall be governed by
and construed in accordance with the laws of the State of New York, including
General Obligations Law 5-1401, but otherwise without giving effect to its
choice of law rules.

 

10.8                           Assignments, Participations, Syndication, Etc.

 

(1)                                  With the prior written consent of the
Administrative Agent, such consent not to be unreasonably withheld or delayed,
and, provided there is no Potential Default or Event of Default then continuing,
with prior notice to Borrower, any Lender may at any time assign and delegate to
one or more Eligible Assignees (provided that no written consent of the
Administrative Agent shall be required in connection with any assignment and
delegation by a Lender to an Affiliate of such Lender) (each an “Assignee”) all
or any part of such Lender’s Pro Rata Share of the Loans and the other
Obligations held by such Lender hereunder, in a minimum amount of $1,000,000,
which minimum amount may be an aggregated amount in the event of simultaneous
assignments to or by two or more funds under common management (or if such
Lender’s Pro Rata Share of the Loans is less than $1,000,000, one hundred
percent (100%) thereof); provided, however, that the Borrower and the
Administrative Agent may continue to deal solely and directly with such Lender
in connection with the interest so assigned to an Assignee until (i) written
notice of such assignment, together with payment instructions, addresses and
related information with respect to the Assignee, shall have been given to the
Borrower and the Administrative Agent by such Lender and the Assignee; (ii) such
Lender and its Assignee shall have delivered to the Borrower and the
Administrative Agent an Assignment and Acceptance Agreement, (iii) the
assignment shall have been recorded in the Register, and (iv) the Assignee has
paid to the Administrative Agent a processing fee in the amount of $3,500.

 

(2)                                  The Agent shall, on behalf of the Borrower,
maintain a copy of each Assignment and Acceptance Agreement delivered to it and
a register (the “Register”) for the recordation of the names and addresses of
the Lenders and the principal amount of the Loans owing to each Lender from time
to time.  The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, each Lender and the Administrative Agent shall
treat each Person whose name is recorded in the Register as the owner of the
Loans for all purposes of this Agreement.  Upon request from Borrower, the
Administrative Agent shall provide a copy of the Register to Borrower.  From and
after the date that the Administrative Agent notifies the assignor Lender and
the Borrower that it has received an executed Assignment and Acceptance
Agreement and payment of the above-referenced processing fee, and the assignment
has been recorded in the Register:  (i) the Assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder and under the
other Loan Documents have been assigned to it pursuant to such Assignment and
Acceptance Agreement,

 

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shall have the rights and obligations of a Lender under the Loan Documents,
(ii) the assignor Lender shall, to the extent that rights and obligations
hereunder and under the other Loan Documents have been assigned by it pursuant
to such Assignment and Acceptance Agreement, relinquish its rights and be
released from its obligations under the Loan Documents (but shall be entitled to
indemnification as otherwise provided in this Agreement with respect to any
events occurring prior to the assignment) and (iii) this Agreement shall be
deemed to be amended to the extent, but only to the extent, necessary to reflect
the addition of the Assignee and the resulting adjustment of the Pro Rata Shares
resulting therefrom.

 

(3)                                  Within five Business Days after its receipt
of notice by the Administrative Agent that it has received an executed
Assignment and Acceptance Agreement and payment of the processing fee (which
notice shall also be sent by the Administrative Agent to each Lender), the
Borrower shall, if requested by the Assignee, execute and deliver to the
Administrative Agent, a new Note evidencing such Assignee’s Pro Rata Share of
the Loans.

 

(4)                                  Any Lender may at any time sell to one or
more commercial banks or other Persons not Affiliates of the Borrower (a
“Participant”) participating interests in the Loans and the other interests of
that Lender (the “Originating Lender”) hereunder and under the other Loan
Documents; provided, however, that (i) the Originating Lender’s obligations
under this Agreement shall remain unchanged, (ii) the Originating Lender shall
remain solely responsible for the performance of such obligations, and (iii) the
Borrower and the Administrative Agent shall continue to deal solely and directly
with the Originating Lender in connection with the Originating Lender’s rights
and obligations under this Agreement and the other Loan Documents.  In the case
of any such participation, the Participant shall be entitled to the benefit of
Sections 2.10, 2.11, and 2.14 (and subject to the burdens of Sections 2.11, 2.12
and 10.8 above) as though it were also a Lender thereunder, and if amounts
outstanding under this Agreement are due and unpaid, or shall have been declared
or shall have become due and payable upon the occurrence of an Event of Default,
each Participant shall be deemed to have the right of set-off in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement, and Section 10.10 of this Agreement shall apply to
such Participant as if it were a Lender party hereto.

 

(5)                                  Notwithstanding any other provision
contained in this Agreement or any other Loan Document to the contrary, any
Lender may assign all or any portion of its Pro Rata Share of the Loans held by
it to any Federal Reserve Lender or the United States Treasury as collateral
security pursuant to Regulation A of the Board of Governors of the Federal
Reserve System and any Operating Circular issued by such Federal Reserve Lender,
provided that any payment in respect of such assigned Pro Rata Share of the
Loans made by the Borrower to or for the account of the assigning and/or
pledging Lender in accordance with the terms of this Agreement shall satisfy the
Borrower’s obligations hereunder in respect to such assigned Pro Rata Share of
the Loans to the extent of such payment.  No such assignment shall release the
assigning Lender from its obligations hereunder.  Notwithstanding anything to
the contrary contained herein, any Lender that is a fund that invests in bank
loans may create a security interest in all or any portion of the sums owing to
it and the Note or Notes held by it to the trustee for holders of obligations
owed, or securities

 

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issued, by such fund as security for such obligations or securities, provided,
that unless and until such trustee actually becomes a Lender in compliance with
the other provisions of this Section 10.8, (i) no such pledge shall release the
pledging Lender from any of its obligations under the Loan Documents and
(ii) such trustee shall not be entitled to exercise any of the rights of a
Lender under the Loan Documents even though such trustee may have acquired
ownership rights with respect to the pledged interest through foreclosure or
otherwise.

 

10.9                           Counterparts.  This Agreement and the other Loan
Documents may be executed in any number of counterparts, all of which together
shall constitute one agreement.

 

10.10                     Sharing of Payments.  If any Lender shall receive and
retain any payment, whether by setoff, application of deposit balance or
security, or otherwise, in respect of the Obligations in excess of such Lender’s
Pro Rata Share thereof, then such Lender shall purchase from the other Lenders
for cash and at face value and without recourse, such participation in the
Obligations held by them as shall be necessary to cause such excess payment to
be shared ratably as aforesaid with each of them; provided, that if such excess
payment or part thereof is thereafter recovered from such purchasing Lender, the
related purchases from the other Lenders shall be rescinded ratably and the
purchase price restored as to the portion of such excess payment so recovered,
but without interest.  Each Lender is hereby authorized by the Borrower to
exercise any and all rights of setoff, counterclaim or bankers’ lien against the
full amount of the Obligations, whether or not held by such Lender.  Each Lender
hereby agrees to exercise any such rights first against the Obligations and only
then to any other Indebtedness of the Borrower to such Lender.

 

10.11                     Confidentiality.  Each Lender agrees to take normal
and reasonable precautions and exercise due care to maintain the confidentiality
of all information provided to it by any of the Borrower Parties or by the
Administrative Agent on the Borrower Parties’ behalf, in connection with this
Agreement or any other Loan Document, and neither it nor any of its Affiliates
shall use any such information for any purpose or in any manner other than
pursuant to the terms contemplated by this Agreement, except to the extent such
information: (1) was or becomes generally available to the public other than as
a result of a disclosure by any Lender or any prospective Lender, or (2) was or
becomes available from a source other than the Borrower Parties not known to the
Lenders to be in breach of an obligation of confidentiality to the Borrower
Parties in the disclosure of such information.  Nothing contained herein shall
restrict any Lender from disclosing such information (r) to any pledgee to whom
such Lender pledges or assigns a security interest in all or any portion of its
rights under this Agreement (including under its Note, if any) to secure the
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, (s) to any rating agency when required by
it (it being understood that prior to any such disclosure, such rating agency
shall undertake to preserve the confidentiality of any such information relating
to the Loan Parties received by it from such Lender), (t) pursuant to any
requirement of any Governmental Authority; (u) pursuant to subpoena or other
court process; (v) when required to do so in accordance with the provisions of
any applicable Requirement of Law; (w) to the extent reasonably required in
connection with any litigation or proceeding to which the Administrative Agent,
any Lender or their respective Affiliates may be party; (x) to the extent
reasonably required in connection with the exercise of any remedy hereunder or
under any other Loan Document; (y) to such Lender’s independent auditors and
other professional advisors; and (z) to any Participant or Assignee and to any

 

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prospective Participant or Assignee, and to any financial institution that is a
direct or indirect contractual counterparty in swap agreements or such
contractual counterparty’s professional advisor provided that each Participant
and Assignee or prospective Participant or Assignee, and each contractual
counterparty or professional advisor to such contractual counterparty, first
agrees to be bound by the provisions of this Section 10.11.

 

10.12                     Consent to Jurisdiction.  (1) ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK LOCATED IN NEW YORK COUNTY OR OF
THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE LOAN PARTIES, THE ADMINISTRATIVE AGENT
AND THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS.  EACH OF THE LOAN PARTIES, THE
ADMINISTRATIVE AGENT AND THE LENDERS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO.  EACH OF THE LOAN PARTIES, THE ADMINISTRATIVE AGENT AND THE
LENDERS EACH AGREE THAT SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS
MAY BE MADE BY ANY MEANS PERMITTED BY NEW YORK LAW.

 

(2)  NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS SECTION 10.12, NOTHING IN
THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY
LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS AGAINST THE BORROWER OR ANY OF ITS
PROPERTY IN THE COURTS OF ANY JURISDICTION.

 

10.13                     Waiver of Jury Trial.  EACH OF THE LOAN PARTIES, THE
ADMINISTRATIVE AGENT AND THE LENDERS WAIVE ITS RESPECTIVE RIGHTS TO A TRIAL BY
JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO
THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE
BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY PARTICIPANT OR
ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. 
EACH OF THE LOAN PARTIES, THE ADMINISTRATIVE AGENT AND THE LENDERS AGREE THAT
ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A
JURY.  WITHOUT LIMITING THE FOREGOING, EACH OF SUCH PARTIES FURTHER AGREES THAT
ITS RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS
SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE
OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT, THE
OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.  THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,

 

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SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

 

10.14                     Indemnity.  Whether or not the transactions
contemplated hereby are consummated, the Loan Parties shall indemnify and hold
the Administrative Agent, the other Agents, the Joint Lead Arrangers, and each
Lender and each of their respective officers, directors, employees, counsel,
agents and attorneys-in-fact (each, an “Indemnified Person”) harmless from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, charges, expenses and disbursements (including
reasonable attorney’s fees and expenses) of any kind or nature whatsoever which
may at any time (including at any time following repayment of the Loans and the
termination, resignation or replacement of the Administrative Agent or
replacement of any Lender) be imposed on, incurred by or asserted against any
such Person in any way relating to or arising out of this Agreement or any
document contemplated by or referred to herein, or the transactions contemplated
hereby, or any action taken or omitted by any such Person under or in connection
with any of the foregoing, including with respect to any investigation,
litigation or proceeding (including any insolvency proceeding or appellate
proceeding) related to or arising out of this Agreement or the Loans or the use
of the proceeds thereof, whether or not any Indemnified Person is a party
thereto (all the foregoing, collectively, the “Indemnified Liabilities”);
provided, however, that the Loan Parties shall have no obligation hereunder to
any Indemnified Person with respect to Indemnified Liabilities to the extent
resulting from the gross negligence or willful misconduct of such Indemnified
Person.  Without limiting the foregoing, the Loan Parties shall pay all
reasonable out-of-pocket expenses (including reasonable fees and disbursements
of outside counsel) (1) of the Administrative Agent and the Syndication Agent
incident to the preparation, negotiation and administration and performance of
the Loan Documents, including any proposed Modifications or waivers with respect
thereto, the due diligence review undertaken in connection therewith, and the
syndication of the Loans (but such expenses shall not include any fees paid to
the syndicate members), and the preservation and protection of the rights of the
Secured Parties and the Administrative Agent under the Loan Documents (including
expenses incurred in creating and perfecting the Lien in favor of the
Administrative Agent pursuant to this Agreement and the other Loan Documents),
and (2) of the Administrative Agent and each of the Lenders incident to the
enforcement of payment of the Obligations, whether by judicial proceedings or
otherwise, including, without limitation, in connection with bankruptcy,
insolvency, liquidation, reorganization, moratorium or other similar proceedings
involving any Borrower Party or a “workout” of the Obligations.  The agreements
in this Section 10.14 shall survive payment of all other Obligations.

 

10.15                     Telephonic Instruction.  Any agreement of the
Administrative Agent and the Lenders herein to receive certain notices by
telephone is solely for the convenience and at the request of the Borrower.  The
Administrative Agent and the Lenders shall be entitled to reasonably rely on the
authority of any Person purporting to be a Person authorized by the Borrower to
give such notice and the Administrative Agent and the Lenders shall not have any
liability to the Borrower or other Person on account of any action taken or not
taken by the Administrative Agent or the Lenders in reliance upon such
telephonic notice.  The obligation of the Borrower to repay the Loans shall not
be affected in any way or to any extent by any failure by the Administrative
Agent and the Lenders to receive written confirmation of any telephonic notice
or the receipt by the Administrative Agent and the Lenders of a confirmation
which is at variance with the terms understood by the Administrative Agent and
the Lenders to be contained

 

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in the telephonic notice.

 

10.16                     Marshalling; Payments Set Aside.  Neither the
Administrative Agent nor the Lenders shall be under any obligation to marshal
any assets in favor of any of the Borrower Parties or any other Person or
against or in payment of any or all of the Obligations.  To the extent that any
of the Borrower Parties makes a payment or payments to the Administrative Agent
or the Lenders, or the Administrative Agent or the Lenders enforce their Liens
or exercise their rights of set-off, and such payment or payments or the
proceeds of such enforcement or set-off or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative Agent
in its discretion) to be repaid to a trustee, receiver or any other party in
connection with any insolvency proceeding, or otherwise, then (1) to the extent
of such recovery the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or set-off had not occurred, and
(2) each Lender severally agrees to pay to the Administrative Agent upon demand
its ratable share of the total amount so recovered from or repaid by the
Administrative Agent.

 

10.17                     Set-off.  In addition to any rights and remedies of
the Lenders provided by law, if an Event of Default exists, each Lender is
authorized at any time and from time to time, without prior notice to the
Borrower, Leasehold Holder or Holdco, any such notice being waived by the
Borrower and Leasehold Holder and Holdco to the fullest extent permitted by law,
to set off and apply in favor of the Lenders any and all deposits (general or
special, time or demand, provisional or final) at any time held by, and other
indebtedness at any time owing to, such Lender to or for the credit or the
account of the Borrower, Leasehold Holder and Holdco against any and all
Obligations owing to the Lenders, now or hereafter existing, irrespective of
whether or not the Administrative Agent or such Lender shall have made demand
under this Agreement or any Loan Document and although such Obligations may be
contingent or unmatured.  Each Lender agrees promptly to (1) notify the Loan
Parties and the Administrative Agent after any such set-off and application made
by such Lender; provided, however, that the failure to give such notice shall
not affect the validity of such set-off and application and (2) pay such amounts
that are set-off to the Administrative Agent for the ratable benefit of the
Lenders.

 

10.18                     Severability.  The illegality or unenforceability of
any provision of this Agreement or any other Loan Document or any instrument or
agreement required hereunder or thereunder shall not in any way affect or impair
the legality or enforceability of the remaining provisions hereof or thereof.

 

10.19                     No Third Parties Benefited.  This Agreement and the
other Loan Documents are made and entered into for the sole protection and legal
benefit of the Borrower Parties, the Lenders, the Joint Lead Arrangers, and the
Agents, and their permitted successors and assigns, and no other Person shall be
a direct or indirect legal beneficiary of, or have any direct or indirect cause
of action or claim in connection with, this Agreement or any of the other Loan
Documents.

 

10.20                     Time.  Time is of the essence as to each term or
provision of this Agreement and each of the other Loan Documents.

 

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10.21                     Reinstatement.  This Agreement and the security
interests created herein shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Obligations
hereunder, or any part thereof, is, pursuant to bankruptcy, insolvency or other
applicable laws, rescinded or reduced in amount, or must otherwise be restored
or returned by Administrative Agent or any Lender.  In the event that any
payment or any part thereof is so rescinded, reduced, restored or returned, such
Obligations and the security interests created herein shall continue to be
effective or be reinstated (except to the extent the related Collateral has been
sold to a bona fide purchaser for value) and deemed reduced only by such amount
paid and not so rescinded, reduced, restored or returned.

 

10.22                     Rights Under Specified Interest Rate Contracts. 
Neither the Loan Documents nor any Specified Interest Rate Contracts will create
(or be deemed to create) in favor of any counterparty that is a party thereto
any rights in connection with the management or release of any Collateral or of
the obligations of the Borrower under the Loan Documents.

 

10.23                     Reaffirmation, Waiver of Offsets, Counterclaims and
Defenses.

 

(1)                                  Borrower hereby acknowledges and agrees
that all terms, covenants, conditions and provisions of the Loan Documents
continue in full force and effect and remain unaffected and unchanged, except to
the extent expressly set forth in this Agreement and in the amendments and/or
restatements of Loan Documents and additional Loan Documents entered into by
Secured Parties, Borrower and the other parties thereto as of the Effective
Date.  Neither this Agreement nor the amendments and/or restatements of Loan
Documents and additional Loan Documents entered into as of the Effective Date,
nor the execution and delivery of thereof by Secured Parties, Borrower and the
other parties thereto shall constitute a novation, renewal release, waiver,
discharge or relinquishment of, and shall not affect, the liens, security
interests and rights, remedies and interests under, the Loans or any Obligations
or any of the Loan Documents, all of which are hereby ratified, confirmed and
reaffirmed in all respects.

 

(2)                                  Borrower hereby represents, warrants,
covenants, acknowledges and agrees that Borrower’s obligations to the Secured
Parties under this Agreement and the other Loan Documents are valid and
enforceable, and Borrower has no, and expressly waives any and all, defenses,
offsets, counterclaims, cross-claims, causes of action, demands or other adverse
claims of any kind whatsoever, including without limitation, any usury or lender
liability claims or defenses, against the Secured parties or any Secured
Parties’ respective past, present and/or future parent, subsidiary and
affiliated entities or any of their respective past and present officers,
directors, shareholders, partners, limited partners, members, representatives,
principals, owners, affiliates, participants, attorneys, accountants, agents or
employees, or their successors, heirs and assigns (collectively, “Lender
Parties”), arising out of or relating to the Loans, this Agreement, any other
Loan Documents, any Collateral, or with respect to the payment and performance
of the Loans and other Obligations represented by this Agreement and the other
Loan Documents, or arising out of or relating to any past, present or future
relationship between or among Secured Parties or any of the Lender Parties and
any Borrower Party or any Affiliates thereof, or arising out of or relating to
any actual or alleged acts, transactions or omissions on the part of Secured
Parties or any of the Lender Parties.

 

(3)                                  Any assignee of any Secured Party’s
interest in and to this Agreement, the

 

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Note and the other Loan Documents shall take the same free and clear of all
offsets, counterclaims or defenses which are unrelated to such documents which
Borrower may otherwise have against any assignor of such documents, and no such
unrelated counterclaim or defense shall be interposed or asserted by Borrower in
any action or proceeding brought by any such assignee upon such documents and
any such right to interpose or assert any such unrelated offset, counterclaim or
defense in any such action or proceeding is hereby expressly waived by Borrower.

 

ARTICLE XI
PAYMENT GUARANTY

 

11.1                           Payment Guaranty.  In order to induce the
Administrative Agent and the Lenders to enter into this Agreement and to
maintain credit hereunder, and in recognition of the direct benefits to be
received by Payment Guarantor from the restructuring of the Existing Loans
pursuant to the terms of this Agreement and the other Loan Documents, Payment
Guarantor hereby agree with the Secured Parties as follows:  Payment Guarantor
hereby unconditionally and irrevocably guarantees as primary obligor and not
merely as surety the full and prompt payment when due, whether upon maturity,
acceleration or otherwise, of any and all of the Guaranteed Obligations of the
Borrower to the Secured Parties.  If any or all of the Guaranteed Obligations of
the Borrower to the Secured Parties becomes due and payable hereunder, Payment
Guarantor, unconditionally and irrevocably, promises to pay such indebtedness to
the Administrative Agent and/or the other Secured Parties, or order, on demand,
together with any and all expenses which may be incurred by the Administrative
Agent and the other Secured Parties in collecting any of the Guaranteed
Obligations.  If claim is ever made upon any Secured Party for repayment or
recovery of any amount or amounts received in payment or on account of any of
the Guaranteed Obligations and any of the aforesaid payees repays all or part of
said amount by reason of (i) any judgment, decree or order of any court or
administrative body having jurisdiction over such payee or any of its property
or (ii) any settlement or compromise of any such claim effected by such payee
with any such claimant (including the Borrower), then and in such event Payment
Guarantor agrees that any such judgment, decree, order, settlement or compromise
shall be binding upon Payment Guarantor, notwithstanding any revocation of this
Payment Guaranty or other instrument evidencing any liability of the Borrower,
and Payment Guarantor shall be and remain liable to the aforesaid payees
hereunder for the amount so repaid or recovered to the same extent as if such
amount had never originally been received by any such payee. Should, contrary to
the intent of the parties that this Agreement be governed by the laws of the
State of New York, it be determined that Payment Guarantor is entitled to the
benefits of NRS 40.430, to the fullest extent permitted by applicable law,
including NRS 40.495, Payment Guarantor hereby waives the same.

 

11.2                           Bankruptcy.  Additionally, Payment Guarantor
unconditionally and irrevocably guarantees the payment of any and all of the
Guaranteed Obligations to the Secured Parties whether or not due or payable by
the Borrower upon the occurrence of any of the events specified in
Section 7.1(6), and irrevocably and unconditionally promises to pay such
indebtedness to the Secured Parties, or order, on demand, in lawful money of the
United States.

 

11.3                           Nature of Liability. The liability of Payment
Guarantor hereunder is primary, absolute and unconditional, exclusive and
independent of any security for or other guaranty of

 

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the Guaranteed Obligations, whether executed by any other guarantor or by any
other party, and the liability of Payment Guarantor hereunder shall not be
affected or impaired by (a) any direction as to application of payment by the
Borrower or by any other party, or (b) any other continuing or other guaranty,
undertaking or maximum liability of a guarantor or of any other party as to the
Guaranteed Obligations, or (c) any payment on or in reduction of any such other
guaranty or undertaking, or (d) any dissolution, termination or increase,
decrease or change in personnel by the Borrower, or (e) any payment made to any
Secured Party on the Guaranteed Obligations which any such Secured Party repays
to the Borrower pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and Payment Guarantor
waives any right to the deferral or modification of its obligations hereunder by
reason of any such proceeding, or (f) any action or inaction by the Secured
Parties as contemplated in Section 11.5, or (g) any invalidity, irregularity or
enforceability of all or any part of the Guaranteed Obligations or of any
security therefor.

 

11.4                           Independent Obligation.  The obligations of
Payment Guarantor hereunder are independent of the obligations of any other
guarantor, any other party or the Borrower, and a separate action or actions may
be brought and prosecuted against Payment Guarantor whether or not action is
brought against any other guarantor, any other party or the Borrower and whether
or not any other guarantor, any other party or the Borrower be joined in any
such action or actions. Payment Guarantor waives, to the fullest extent
permitted by law, the benefit of any statute of limitations affecting its
liability hereunder or the enforcement thereof.  Any payment by the Borrower or
other circumstance which operates to toll any statute of limitations as to the
Borrower shall operate to toll the statute of limitations as to Payment
Guarantor.

 

11.5                           Authorization. Payment Guarantor authorizes the
Secured Parties without notice or demand (except as shall be required by
applicable statute and cannot be waived), and without affecting or impairing its
liability hereunder, from time to time to:

 

(1)                                  change the manner, place or terms of
payment of, and/or change or extend the time of payment of, renew, increase,
accelerate or alter, any of the Guaranteed Obligations (including any increase
or decrease in the principal amount thereof or the rate of interest or fees
thereon), any security therefor, or any liability incurred directly or
indirectly in respect thereof, and this Payment Guaranty shall apply to the
Guaranteed Obligations as so changed, extended, renewed or altered;

 

(2)                                  take and hold security for the payment of
the Guaranteed Obligations and sell, exchange, release, impair, surrender,
realize upon or otherwise deal with in any manner and in any order any property
by whomsoever at any time pledged or mortgaged to secure, or howsoever securing,
the Guaranteed Obligations or any liabilities (including any of those hereunder)
incurred directly or indirectly in respect thereof or hereof, and/or any offset
there against;

 

(3)                                  exercise or refrain from exercising any
rights against the Borrower, any other Borrower Party or others or otherwise act
or refrain from acting;

 

(4)                                  release or substitute any one or more
endorsers, guarantors, the Borrower, other Borrower Parties or other obligors;

 

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(5)                                  settle or compromise any of the Guaranteed
Obligations, any security therefor or any liability (including any of those
hereunder) incurred directly or indirectly in respect thereof or hereof, and may
subordinate the payment of all or any part thereof to the payment of any
liability (whether due or not) of the Borrower to its creditors other than the
Secured Parties;

 

(6)                                  apply any sums by whomsoever paid or
howsoever realized to any liability or liabilities of the Borrower to the
Secured Parties regardless of what liability or liabilities of the Borrower
remain unpaid;

 

(7)                                  consent to or waive any breach of, or any
act, omission or default under, this Agreement, any other Loan Document or any
of the instruments or agreements referred to herein or therein, or otherwise
amend, modify or supplement this Agreement, any other Loan Document or any of
such other instruments or agreements; and/or

 

(8)                                  take any other action which would, under
otherwise applicable principles of common law, give rise to a legal or equitable
discharge of Payment Guarantor from its liabilities under this Payment Guaranty.

 

11.6                           Reliance. It is not necessary for any Secured
Party to inquire into the capacity or powers of Payment Guarantor or any of its
Subsidiaries or the officers, directors, managers, managing members, partners or
agents acting or purporting to act on their behalf, and any Guaranteed
Obligations made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.

 

11.7                           Subordination. Any indebtedness of the Borrower
now or hereafter owing to Payment Guarantor is hereby subordinated to the
Guaranteed Obligations owing to the Secured Parties; and at a time when an Event
of Default exists, all such indebtedness of the Borrower to Payment Guarantor
shall be collected, enforced and received by Payment Guarantor for the benefit
of the Secured Parties and if the Administrative Agent so requests be paid over
to the Administrative Agent on behalf of the Secured Parties on account of the
Guaranteed Obligations to the Secured Parties, but without affecting or
impairing in any manner the liability of Payment Guarantor under the other
provisions of this Payment Guaranty.  Prior to the transfer by Payment Guarantor
of any note or negotiable instrument evidencing any such indebtedness of the
Borrower to Payment Guarantor, Payment Guarantor shall mark such note or
negotiable instrument with a legend that the same is subject to this
subordination.  Without limiting the generality of the foregoing, Payment
Guarantor hereby agrees with the Secured Parties that it will not exercise any
right of subrogation which it may at any time otherwise have as a result of this
Payment Guaranty (whether contractual, under Section 509 of the Bankruptcy Code
or otherwise) until all Guaranteed Obligations have been irrevocably paid in
full in cash.

 

11.8                           Waiver. (a)  Payment Guarantor waives any right
(except as shall be required by applicable statute and cannot be waived) to
require any Secured Party to (i) proceed against the Borrower, any other
guarantor or any other party, (ii) proceed against or exhaust any security held
from the Borrower, any other guarantor or any other party or (iii) pursue any
other remedy in any Secured Party’s power whatsoever.  Payment Guarantor waives
any defense based on or arising out of any defense of the Borrower, any other
guarantor or any other party, other than

 

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payment of the Guaranteed Obligations to the extent of such payment, based on or
arising out of the disability of the Borrower, Payment Guarantor, any other
guarantor or any other party, or the validity, legality or unenforceability of
the Guaranteed Obligations or any part thereof from any cause, or the cessation
from any cause of the liability of the Borrower other than payment of the
Guaranteed Obligations to the extent of such payment.  The Secured Parties may,
at their election, foreclose on any security held by the Administrative Agent or
any other Secured Party by one or more judicial or nonjudicial sales, whether or
not every aspect of any such sale is commercially reasonable (to the extent such
sale is permitted by applicable law), or exercise any other right or remedy the
Secured Parties may have against the Borrower or any other party, or any
security, without affecting or impairing in any way the liability of Payment
Guarantor hereunder except to the extent the Guaranteed Obligations have been
paid.  Payment Guarantor waives any defense arising out of any such election by
the Secured Parties, even though such election operates to impair or extinguish
any right of reimbursement or subrogation or other right or remedy of Payment
Guarantor against the Borrower or any other party or any security.

 

(b)                                 Payment Guarantor waives all presentments,
demands for performance, protests and notices, including without limitation
notices of nonperformance, notices of protest, notices of dishonor, notices of
acceptance of this Payment Guaranty, and notices of the existence, creation or
incurring of new or additional Guaranteed Obligations.  Payment Guarantor
assumes all responsibility for being and keeping itself informed of the
Borrower’s financial condition and assets, and of all other circumstances
bearing upon the risk of nonpayment of the Guaranteed Obligations and the
nature, scope and extent of the risks which Payment Guarantor assumes and incurs
hereunder, and agrees that neither the Administrative Agent nor any of the other
Secured Parties shall have any duty to advise Payment Guarantor of information
known to them regarding such circumstances or risks.

 

(c)                                  Until such time as the Guaranteed
Obligations have been paid in full in cash, Payment Guarantor hereby defers the
enforcement of all rights of subrogation which it may at any time otherwise have
as a result of this Payment Guaranty (whether contractual, under Section 509 of
the Bankruptcy Code, or otherwise) to the claims of the Secured Parties against
the Borrower or any other guarantor of the Guaranteed Obligations and all
contractual, statutory or common law rights of reimbursement, contribution or
indemnity from the Borrower or any other guarantor which it may at any time
otherwise have as a result of this Payment Guaranty.

 

(d)                                 PAYMENT GUARANTOR HEREBY WAIVES THE
PROVISIONS OF NEVADA REVISED STATUTES SECTION 40.430 PURSUANT TO NEVADA REVISED
STATUTES SECTION 40.495, AND BY THIS WAIVER PAYMENT GUARANTOR ACKNOWLEDGES THAT
THE ADMINISTRATIVE AGENT AND/OR ANY OTHER SECURED PARTY MAY, BY A LAWSUIT
AGAINST PAYMENT GUARANTOR, BRING AN ACTION FOR THE ENFORCEMENT OF THIS PAYMENT
GUARANTY SEPARATELY AND INDEPENDENTLY FROM (I) ANY ACTION AGAINST THE BORROWER
UNDER THE NOTE OR OTHER LOAN DOCUMENTS, (II) THE EXERCISE OF ANY POWER OF SALE
UNDER ANY SECURITY INSTRUMENT, (III) ANY OTHER ACTION TO FORECLOSE UPON REAL
PROPERTY OR OTHERWISE ENFORCE ANY SECURITY INSTRUMENT BY THE SALE OF ANY
COLLATERAL, AND (IV) ANY OTHER PROCEEDINGS AGAINST THE BORROWER, AND WITHOUT ANY
OBLIGATION TO FIRST PURSUE ANY SUCH OTHER RIGHTS OR REMEDIES OF THE

 

132

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ADMINISTRATIVE AGENT AND/OR THE LENDERS BEFORE PURSUING AN ACTION TO ENFORCE
THIS PAYMENT GUARANTY AGAINST PAYMENT GUARANTOR.  PAYMENT GUARANTOR REPRESENTS,
WARRANTS AND ACKNOWLEDGES TO THE ADMINISTRATIVE AGENT AND THE OTHER SECURED
PARTIES THAT IT UNDERSTANDS THE FOREGOING WAIVER AND THAT IT HAS MADE THE
FOREGOING WAIVER KNOWINGLY AND VOLUNTARILY, WITHOUT DURESS, AND UPON
CONSULTATION WITH AND UPON THE ADVICE OF ITS OWN LEGAL COUNSEL.

 

(e)                                  Payment Guarantor warrants and agrees that
each of the waivers set forth above is made with full knowledge of its
significance and consequences and that if any of such waivers are determined to
be contrary to any applicable law of public policy, such waivers shall be
effective only to the maximum extent permitted by law.

 

11.9                           Payments. All payments made by Payment Guarantor
pursuant to this Article XI shall be made in Dollars and will be made without
setoff, counterclaim or other defense, and shall be subject to the provisions of
Section 2.4.

 

11.10                     Joint and Several Obligations.  The Loan Parties are
jointly and severally liable for all obligations arising hereunder.  Any one of
Borrower or any Payment Guarantor or any other party liable upon or in respect
of this Payment Guaranty or the Loan may be released without affecting the
liability of any party not so released.  If Payment Guarantor consists of more
than one Person, the obligations and liabilities of each Person shall be joint
and several.

 

11.11                     Maximum Liability.  It is the desire and intent of
Payment Guarantor and the Secured Parties that this Payment Guaranty shall be
enforced against Payment Guarantor to the fullest extent permissible under the
laws and public policies applied in each jurisdiction in which enforcement is
sought.  If, however, and to the extent that, the obligations of Payment
Guarantor under this Payment Guaranty shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of any
applicable state or federal law relating to fraudulent conveyances or
transfers), then the amount of Payment Guarantor’s obligations under this
Payment Guaranty shall be deemed to be reduced and Payment Guarantor shall pay
the maximum amount of the Guaranteed Obligations which would be permissible
under applicable law.

 

[SIGNATURE PAGES FOLLOWING]

 

133

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first above written.

 

 

 

BORROWER:

 

 

 

 

 

 

CV PROPCO, LLC, a Nevada limited liability

 

 

company

 

 

 

 

 

 

 

 

 

 

By:

/s/ Thomas M. Friel

 

 

Name:

Thomas M. Friel

 

 

Title:

Senior Vice President

 

 

 

 

 

 

 

 

 

 

LEASEHOLD HOLDER:

 

 

 

 

 

 

NP TROPICANA LLC, a Nevada limited

 

 

liability company

 

 

 

 

 

 

 

 

 

 

By:

/s/ Thomas M. Friel

 

 

Name:

Thomas M. Friel

 

 

Title:

Senior Vice President

 

 

 

 

 

 

 

 

 

 

HOLDCO:

 

 

 

 

 

 

NP LANDCO HOLDCO LLC, a Nevada

 

 

limited liability company

 

 

 

 

 

 

 

 

 

 

By:

/s/ Thomas M. Friel

 

 

Name:

Thomas M. Friel

 

 

Title:

Senior Vice President

 

[A/R Credit Agreement ]

 

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

 

 

 

LENDERS AND AGENTS:

 

 

 

 

 

 

DEUTSCHE BANK AG CAYMAN ISLANDS

 

 

BRANCH, as Administrative Agent and a

 

 

Lender

 

 

 

 

 

 

 

 

 

 

By:

/s/ John K. Beacham

 

 

Name:

John K. Beacham

 

 

Title:

Director

 

 

 

 

 

 

By:

/s/ Robert W. Pettinato

 

 

Name:

Robert W. Pettinato

 

 

Title:

Managing Director

 

[A/R Credit Agreement ]

 

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

 

 

 

JPMORGAN CHASE BANK, N.A., as

 

 

Syndication Agent and a Lender

 

 

 

 

 

 

 

 

 

 

By:

/s/ Charles O. Freedgood

 

 

Name:

Charles O. Freedgood

 

 

Title:

Managing Director

 

[A/R Credit Agreement ]

 

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