Exhibit 10.41

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”), AND MAY NOT BE OFFERED OR SOLD UNLESS REGISTERED PURSUANT TO SUCH
ACT OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. IN ADDITION,
THIS NOTE MAY NOT BE TRANSFERRED TO ANY PERSON WHO IS NOT AN ELIGIBLE PERSON (AS
DEFINED IN THIS NOTE).

 

SECURED PROMISSORY NOTE

 

$40,000,000

   New York, New York      March 18, 2004

 

W I T N E S S E T H :

 

FOR VALUE RECEIVED, the undersigned, RESORTS REAL ESTATE HOLDINGS, INC., a New
Jersey corporation (the “Company”), hereby unconditionally promises to pay to
the order of KERZNER INTERNATIONAL NORTH AMERICA, INC., a Delaware corporation
having an office at 1415 East Sunrise Blvd., Fort Lauderdale, Florida 33303
(“KINA”), or its permitted assigns, the principal sum of FORTY MILLION DOLLARS
($40,000,000), with interest on the unpaid balance of such amount from the date
hereof at the rates of interest specified herein, in each case on the dates
specified herein.

 

1. DEFINITIONS

 

Capitalized terms and other defined terms used in this Note (as such term is
hereinafter defined) shall (unless otherwise provided elsewhere in this Note)
have the meanings given to them in Annex 1 hereto.

 

All other undefined terms contained in this Note shall, unless the context
indicates otherwise, have the meanings provided for by the Code as in effect in
the State of New York to the extent the same are used or defined therein.

 

The words “include”, “includes”, “including” and “such as” shall be construed as
if followed by the phrase “without limitation.”

 

The words “herein,” “hereof” and “hereunder” and other words of similar import
refer to this Note as a whole, as the same may from time to time be amended,
modified or supplemented and not to any particular section, subsection or clause
contained in this Note.

 

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Unless the context otherwise requires, each term stated in either the singular
or plural shall include the singular and the plural, and pronouns stated in the
masculine, feminine or neuter gender shall include the masculine, the feminine
and the neuter.

 

In the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including” and the words “to” and “until”
each mean “to but excluding” and the word “through” means “to and including”.

 

2. TERMS OF PAYMENT

 

2.1. Principal. The Company shall pay the entire unpaid principal amount of this
Note, together with accrued but unpaid interest thereon through the date of such
payment, on March 16, 2009.

 

2.2. Optional Prepayment. The Company may, at any time, upon ten (10) days’
prior written notice, prepay the outstanding principal amount of this Note,
without premium or penalty, in whole or ratably in part, together with accrued
but unpaid interest thereon, through the date of such prepayment on the
principal amount prepaid. Any such prepayment by the Company shall be applied in
the following order: (a) then due and payable fees and expenses; (b) then due
and payable interest payments on the Notes; and (c) the principal of the Notes.

 

2.3. Mandatory Prepayment. The Company shall pay the outstanding principal
amount of this Note, without premium or penalty, in whole, together with all
accrued but unpaid interest thereon, through the date of such payment, in cash
in immediately available funds within one (1) Business Day following the
earliest to occur of (a) the redemption, purchase or other acquisition at one
time or from time to time of any outstanding principal amount of the Indenture
Notes and/or any Permitted Indenture Refinancing Debt, in the aggregate, which,
when added to any and all payments referred to in clause (b) below, would exceed
$36,000,000 in aggregate principal amount thereof, by any of the Resorts Group
Companies, any obligor under any of the Indenture Notes or any Permitted
Indenture Refinancing Debt or any Affiliate of any of the foregoing, whether
voluntary or involuntary (other than any such redemption required pursuant to
Section 3.09 of the Indenture as in effect on the Issue Date), (b) the payment
at one time or from time to time of any outstanding principal amount of the
Indenture Notes and/or any Permitted Indenture Refinancing Debt, in the
aggregate, which, when added to any and all redemptions, purchases or other
acquisitions referred to in clause (a) above, would exceed $36,000,000 in
aggregate principal amount thereof, whether by means of refinancing or otherwise
(other than, in the case of the Indenture Notes, a Permitted Indenture
Refinancing), or any extension of any date by which payment of any principal
amount of the Indenture Notes or any Permitted Indenture Refinancing Debt shall
be due, (c) the payment at one time or from time to time of any outstanding
principal amount of the CIT Credit Facility Debt and/or any Permitted CIT Credit
Facility Refinancing Debt (other than (i) a Permitted CIT Credit Facility
Refinancing, (ii) in respect of the amortizing payment obligations (under either
the CIT Credit Facility or any Permitted CIT Credit Facility Refinancing
Agreements) that are permitted to be incurred under the terms of the CIT
Agreements (as defined in the Master Agreement) as in effect on the date hereof,
(iii) in respect of revolver rights in effect under the CIT Credit Facility or
any Permitted CIT Credit Facility Refinancing Agreements, or (iv) any
prepayments or advance payments at

 

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one time or from time to time on the CIT Credit Facility Debt or any Permitted
CIT Credit Facility Refinancing Debt, not to exceed $4,000,000 in the
aggregate), (d) the acceleration of the Indenture Notes pursuant to the terms of
the Indenture or the acceleration of any Permitted Indenture Refinancing Debt
pursuant to the terms of any of the Permitted Indenture Refinancing Agreements,
(e) the closing of a Premises Financing, (f) the making of a Change of Control
Offer (as defined in the Indenture) that is accepted by any holder of Indenture
Notes (or any comparable event (as well as a default or event of default upon
the occurrence of a change of control) under any of the Permitted Indenture
Refinancing Agreements, (g) the exercise of an option to effect legal defeasance
or covenant defeasance contemplated by the Indenture or by any of the Permitted
Indenture Refinancing Agreements, or the satisfaction and discharge of the
Indenture or any of the Permitted Indenture Refinancing Agreements, (h) the
sale, transfer, encumbrance or other disposition, whether or not for
consideration, of any part of the Premises or any interest therein, other than
Permitted Exceptions (as defined in the First Mortgage), or (i) any Restricted
Sale or Merger Event shall have occurred; provided, however, that nothing in
this Section 2.3 shall affect or restrict the rights, remedies and obligations
of the parties under Section 4.2.

 

2.4. Interest; Payments on Business Day.

 

(a) The Company shall make payments to the Holder of interest at the Applicable
Rate on the outstanding principal amount of the Notes semi-annually in arrears
on September 15 and March 15 of each year, commencing September 15, 2004 (each
of the foregoing, an “Interest Payment Date”), such payments to be made in
lawful money of the United States of America and in immediately available funds.
All payments of interest hereunder shall be computed on the basis of a 365-day
year for the number of days elapsed.

 

(b) If any payment on this Note becomes due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day and, with respect to payment of interest thereon, shall be payable
at the then Applicable Rate during such extension.

 

(c) So long as any Event of Default shall be continuing, the interest rate
applicable to (i) the outstanding principal amount of the Notes, (ii) any
accrued but unpaid interest that is past due, and (iii) any other payment on
this Note that is past due, shall be increased by 2% per annum above the then
Applicable Rate, which interest or payment under clauses (ii) and (iii) shall be
due and payable on demand.

 

(d) Notwithstanding anything to the contrary set forth in this Section 2.4, if
at any time until the Maturity Date the then Applicable Rate exceeds the highest
rate of interest permissible under any law which a court of competent
jurisdiction shall, in a final determination, deem applicable hereto (the
“Maximum Lawful Rate”), then, in such event, and so long as the Maximum Lawful
Rate would be so exceeded, the rate of interest payable hereunder shall be equal
to the Maximum Lawful Rate; provided, however, that, to the extent permitted by
applicable law, if at any time thereafter the Applicable Rate is less than the
Maximum Lawful Rate, the Company shall continue to pay interest hereunder at the
Maximum Lawful Rate until such time as the total interest received by Holder
hereunder is equal to the total interest which Holder would have received had
the Applicable Rate been (but for the operation of this

 

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paragraph) the interest rate payable since the date hereof. Thereafter, the
interest rate payable hereunder shall be the Applicable Rate unless and until
the Applicable Rate again exceeds the Maximum Lawful Rate, in which event this
paragraph shall again apply. In no event shall the total interest received by
Holder pursuant to the terms hereof exceed the amount which Holder could
lawfully have received had the interest due hereunder been calculated for the
full term hereof at the Maximum Lawful Rate. If the Maximum Lawful Rate is
calculated pursuant to this paragraph, such interest shall be calculated at a
daily rate equal to the Maximum Lawful Rate divided by the number of days in the
year in which such calculation is made. If a court of competent jurisdiction,
notwithstanding the provisions of this Section 2.4(d), shall make a final
determination that Holder has received interest hereunder in excess of the
Maximum Lawful Rate, Holder shall, to the extent permitted by applicable law,
promptly apply such excess first to any interest due and not yet paid under this
Note, then to the principal amount of this Note (without premium or penalty),
then to other unpaid Obligations and thereafter shall refund any excess to the
Company or as a court of competent jurisdiction may otherwise order.

 

2.5. Receipt of Payment. The Company shall make each payment under this Note not
later than 1:00 p.m. (New York City time) on the Business Day when due, in
lawful money of the United States of America, in immediately available funds to
Holder’s depository bank in the United States as designated by Holder from time
to time for deposit in Holder’s depositary account. For purposes only of
computing interest hereunder, each payment shall be applied by Holder to this
Note on the day such payment has been received by Holder in immediately
available funds.

 

3. SECURITY INTEREST

 

3.1. Security Interest. This Note is secured as provided in and shall have the
benefit of: (a) the Security Agreement dated as of the Issue Date (the “Security
Agreement”), by the Company and Holdings in favor of the Holder and the other
parties named therein; and (b) the Stock Pledge Agreement dated as of the Issue
Date (the “Stock Pledge Agreement”), by Holdings in favor of the Holder and the
other parties named therein.

 

4. EVENTS OF DEFAULT; RIGHTS AND REMEDIES

 

4.1. Events of Default. The occurrence of any one or more of the following
events (regardless of the reason therefor) shall constitute an “Event of
Default” hereunder:

 

(a) The Company shall fail to make any payment of principal of or interest on,
or any other amount owing in respect of, the Obligations when due and payable,
or declared due and payable (whether at stated maturity, pursuant to an
acceleration of any of the Notes, pursuant to a prepayment obligation or
otherwise).

 

(b) The Company or any other Resorts Group Company shall fail to perform, keep
or observe, or shall permit to occur a breach or violation of, any of the
provisions of (i) Sections 4.3, 4.9 through 4.14 (inclusive), 4.16, 4.17, 4.18,
4.19(b), 4.19(c) or 4.19(d), 5.1, 5.4, 5.5 or 5.6 of the Master Agreement, (ii)
Section 5 of the Subordination Agreement, (iii) Sections 2.07, 8.01 or 8.03 of
the First Mortgage, or (iv) the Environmental Indemnity Agreement.

 

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(c) The Company or any other Resorts Group Company shall fail to perform, keep
or observe any other provision of this Note, the Master Agreement or any other
Transaction Document (other than the provisions referred to in Section 4.1(b))
and the same shall remain unremedied for a period ending on the first to occur
of thirty (30) days after the Company shall have received written notice of any
such failure from Holder or forty five (45) days after the Company shall have
become aware thereof.

 

(d) A default shall occur under any other agreement, document or instrument to
which the Company, Holdings, Resorts, RIH, New Pier or any New Guarantor is a
party or by which any of its property is bound (other than the Indenture or any
Permitted Indenture Refinancing Agreements) and such default results in
Indebtedness of the Company, Holdings, Resorts, RIH, New Pier or any New
Guarantor, or a portion thereof, in an aggregate amount exceeding $3,500,000, to
become due prior to its stated maturity or prior to its regularly scheduled
dates of payment.

 

(e) Any of the assets having an aggregate value in excess of $3,500,000 of the
Company or Holdings shall be attached, seized, levied upon or subjected to a
writ or distress warrant, or come within the possession of any receiver,
trustee, custodian or assignee for the benefit of creditors of the Company or
Holdings and shall remain unstayed or undismissed for sixty (60) consecutive
days; or any Person, other than the Company or Holdings shall apply for the
appointment of receiver, trustee or custodian for any of the assets of the
Company or Holdings and such application shall remain unstayed or undismissed
for sixty (60) consecutive days.

 

(f) A case or proceeding shall have been commenced against the Company or
Holdings in a court having competent jurisdiction, seeking a decree or order in
respect of the Company or Holdings (i) under title 11 of the United States Code,
as now constituted or hereafter amended, or any other applicable Federal, state
or foreign bankruptcy or other similar law, (ii) appointing a custodian,
receiver, liquidator, assignee, trustee or sequestrator (or similar official) of
the Company or Holdings or of any substantial part of the properties of the
Company or Holdings, or (iii) ordering the winding-up or liquidation of the
affairs of Holdings or the Company and such case or proceeding shall remain
undismissed or unstayed for sixty (60) consecutive days or such court shall
enter a decree or order granting the relief sought in such case or proceeding.

 

(g) The Company or Holdings shall (i) file a petition seeking relief under title
11 of the United States Code, as now constituted or hereafter amended, or any
other applicable Federal, state or foreign bankruptcy or other similar law, (ii)
consent to the institution of proceedings thereunder or to the filing of any
such petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee or sequestrator (or similar official) of
the Company or Holdings or of any substantial part of the properties of the
Company or Holdings, (iii) fail generally to pay its debts as such debts become
due, or (iv) take any corporate action in furtherance of any such action.

 

(h) Final judgment or judgments (after the expiration of all times to appeal
therefrom) for the payment of money in excess of $3,500,000 in the aggregate
shall be rendered against the Company or Holdings and the same shall not be (i)
fully covered by insurance in

 

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accordance with Section 4.7 of the Master Agreement, or (ii) vacated, stayed,
bonded, paid or discharged within a period of sixty (60) days.

 

(i) Any of the Gaming Approvals shall be revoked, terminated or suspended or
expire without having been renewed or replaced if the same will have a Material
Adverse Effect.

 

(j) Any representation or warranty made or deemed made by the Company or any
other Resorts Group Company in any of the Transaction Documents, shall prove to
have been incorrect when made or deemed made in any material respect.

 

(k) An event of default shall have occurred under the Indenture or under any of
the Permitted Indenture Refinancing Agreements, which has resulted in any of the
Indenture Notes or any Permitted Indenture Refinancing Debt, as the case may be,
becoming due and payable before it otherwise would have been due and payable.

 

(l) Any Guarantee is held in any judicial proceeding to be unenforceable or
invalid in whole or in part or ceases for any reason to be in full force and
effect or any Guarantor, or any person acting on behalf of any Guarantor, denies
or disaffirms or threatens to deny or disaffirm its obligations under its
Guarantee.

 

(m) The Company shall cease at any time to be (i) a Wholly Owned Subsidiary of
Holdings, or (ii) an Affiliate of Resorts, RIH, New Pier or any other Guarantor.

 

 

(n) Except for Permitted Exceptions (as defined in the First Mortgage), if the
Property the subject of the First Mortgage or any part thereof becomes subject
(i) to any Lien which is superior to the Lien of the First Mortgage, or (ii) to
any mechanic’s, materialman’s or other Lien which is or is asserted to be
superior to the Lien of the First Mortgage, and any such Lien shall remain
undischarged (by payment, bonding, or otherwise) for ten (10) Business Days
after Company shall have acquired knowledge thereof unless contested in
accordance with the terms of the First Mortgage.

 

(o) If Company (i) consummates a transaction which results in a violation of a
state statute regulating government plans subjecting KINA to liability, or (ii)
engages in a non-exempt prohibited transaction under the Employee Retirement
Income Security Act of 1974, as amended, and the regulations promulgated
thereunder (as the same may be amended from time to time, “ERISA”).

 

(p) If the assets of Company or any Guarantor are at any time treated as “plan
assets”, whether by operation of law or under regulations promulgated under
ERISA.

 

(q) Any of the provisions of the CIT Subordination Agreement shall not be
complied with or adhered to in accordance with their terms by CIT
Group/Equipment Financing, Inc. or the Debtor Group (as defined in the CIT
Subordination Agreement)

 

4.2. Remedies. If any Event of Default specified in Section 4.1 shall have
occurred and be continuing, the Majority Holders may, by written notice to the
Company,

 

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declare all Obligations to be forthwith due and payable, whereupon all such
Obligations shall become and be due and payable, without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived
by the Company; provided, however, that upon the occurrence of an Event of
Default specified in Section 4.1(e), Section 4.1(f) or Section 4.1(g), such
Obligations shall become due and payable without declaration, notice or demand
by any Holder. Notwithstanding anything herein to the contrary, the failure of
Holdings to perform, keep or observe any of the provisions of Sections 4.19(b),
4.19(c) or 4.19(d) of the Master Agreement shall not be deemed an Event of
Default hereunder if, prior to or simultaneously with the occurrence of any
event specified in such provisions, either (i) the Holders shall have been
irrevocably and indefeasibly paid an amount in the aggregate equal to the entire
principal amount of the Notes, plus accrued and unpaid interest thereon through
the date of such payment plus any and all other amounts then due to KINA or the
other Holders pursuant to the Transaction Documents, or (ii) (A) the Holders
shall have been irrevocably and indefeasibly paid an amount in the aggregate
equal to the Guarantee Amount (as defined in the Guarantees) in effect as of the
Cut-off Date (assuming the Cut-off Date was the date of payment) (as defined in
the Guarantees), (B) Company shall have executed and proffered to KINA or its
assigns (or its or their designee) a bargain and sale deed with a covenant as to
grantor’s acts in recordable form conveying marketable title to the Property (as
defined in the First Mortgage), subject only to Permitted Exceptions (as defined
in the First Mortgage), and sufficient to enable KINA or its assigns (or its or
their designee) to obtain an owner’s policy of title insurance for the Property,
subject only to Permitted Exceptions, (x) substantially the same as the owner’s
policy of title insurance in connection with its acquisition of the Property
assuming that such owner’s policy is then readily available to owners of
property, or (y) provided that the owner’s policy set forth in clause (x) is not
available, such other owner’s policy of title insurance which may be available
to owners of similarly situated properties of similar type in Atlantic City, New
Jersey, (C) the Lease Agreement shall have been effectively terminated and the
rights of any tenants claiming by, through or under such Lease Agreement shall
have been effectively terminated (other than the rights of tenant under that
certain lease agreement for Real Property between KINA and 19 North Illinois
Avenue Associates, L.L.C., dated April 15, 1999), and (D) Company shall have
paid all transfer taxes and fees incurred in connection with the delivery and
recordation of the bargain and sale deed executed and proffered by Company to
KINA or its assigns (or its or their designee), if any. Once the events in
clause (i) or clause (ii) above shall have occurred, KINA or the Holders shall
surrender for cancellation the Notes.

 

4.3. Waivers by the Company. Except as otherwise provided for in this Note, the
Company hereby waives presentment, demand and protest and notice of presentment,
dishonor, notice of intent to accelerate and notice of acceleration and any
other formality. The Company acknowledges that it has been advised by counsel of
its choice with respect to this Note and the transactions evidenced by this
Note.

 

5. MISCELLANEOUS

 

5.1. Complete Agreement; Modification of Note. This Note (together with the
other Transaction Documents) constitutes the complete agreement between the
parties with respect to the subject matter hereof. No amendment or waiver of any
provision of this Note, nor consent to any departure by the Company therefrom,
shall in any event be effective unless the

 

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same shall be in writing and signed by Holder, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.

 

5.2. Sale of Interest. (a) Subject to the New Jersey Casino Control Act,
including the need for prior approval of a transfer by the New Jersey Casino
Control Commission, and applicable securities law transfer restrictions, Holder
may sell, assign or transfer to one or more other Persons all or a portion of
its rights and obligations under any Note held by Holder; provided, however,
that the prior consent of the Company will be required for a transfer of any
Note to a Competitor. Notwithstanding the foregoing, the Company’s consent shall
be deemed given if the Company fails to grant or deny its consent (and in the
case of a denial, with a specific statement of the reasons therefor) within ten
(10) Business Days of Holder’s request therefor (which request must specify that
the consent shall be deemed given within such time period in the event of such
failure) and under no circumstances shall the Company’s consent be required if
an Event of Default shall have occurred and be continuing. In addition, KIL and
its Subsidiaries may pledge this Note to any institutional bank lender or any
collateral agent (including The Bank of Nova Scotia or CIBC) for institutional
lenders providing financing to KIL or any of its Subsidiaries and any such
institutional bank lender or collateral agent that is a bank may pledge this
Note to the Federal Reserve System pursuant to Regulation A promulgated under
the Federal Reserve Act of 1913, as amended. The Company hereby consents to any
acquisition of the Note by any such institutional bank lenders or any such
collateral agent pursuant to such pledge subject to the New Jersey Casino
Control Act, including but not limited to the need for prior approval of a
transfer by the New Jersey Casino Control Commission, and applicable securities
transfer restrictions. Any transfer by such pledgee to third parties, however,
shall be subject to the first two sentences of this Section 5.2(a). If Holder
assigns or otherwise transfers all or any part of the Note in accordance with
this paragraph, the Company shall, upon the request of Holder, issue new Notes
and shall register the transfer on its books upon surrender of the old Note.
Each Note shall bear the legend contained in this Note and no transfer may be
made of Notes to a Person other than an Eligible Person or unless such
assignment of such Note and other Notes being assigned is in an aggregate
principal amount of at least $2,500,000.

 

(b) If required pursuant to Gaming Laws, the Company may notify a Holder of one
or more of the Notes, or any interest therein, that such Holder is required to
transfer such Note(s) or interest therein or that the Company elects to redeem
such Note(s) (in which event such redemption shall be treated as an optional
prepayment under Section 2.2) or interest therein. Such notice shall be given
ten (10) days before the required date of transfer or redemption, as the case
may be, and shall be accompanied by evidence demonstrating that such transfer or
redemption is required pursuant to Gaming Laws. Upon receipt of a notice in
accordance with the foregoing, such Holder shall cooperate with the Company in
effectuating the required transfer or redemption within the time period set
forth in such notice, not to be less than the minimum notice period set forth in
the foregoing sentence. Further, if the transfer or redemption of the Note is
triggered by notice from the Gaming Authority that the Holder is disqualified,
commencing on the date the Gaming Authority serves the disqualification notice
upon the Company: (i) the Holder shall no longer receive any interest on this
Note if and only for so long as such interest is not permitted to be paid
pursuant to such Gaming Laws, but the provisions hereof shall not affect the
Company’s obligation to pay accrued interest then unpaid;; (ii) the

 

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Holder shall no longer exercise, directly or through any trustee or nominee, any
right conferred by this Note; and (iii) the Holder shall not receive any
remuneration in any form from RIH for services or otherwise if and only for so
long as such remuneration is not permitted to be paid pursuant to such Gaming
Laws.

 

(c) Under no circumstances shall the Company be permitted to assign any of its
obligations under this Note to any person other than Resorts and any attempt by
the Company to assign such obligations to any person other than Resorts shall be
null and void.

 

5.3. Fees and Expenses. If Holder shall employ counsel or other advisors for
advice or other representation or shall incur reasonable legal or other costs
and expenses in connection with (a) any amendment, modification or waiver, or
consent requested by the Company with respect to, this Note or Holder’s rights
hereunder or (b) any litigation, contest, dispute, suit, proceeding or action
(whether instituted by Holder, the Company or any other Person) in any attempt
to enforce any rights of Holder against the Company, then, and in any such
event, the attorneys’ and other parties’ fees arising from such services,
including those of any appellate proceedings, and all expenses, costs, charges
and other fees incurred by such counsel, and others, in any way or respect
arising in connection with or relating to any of the events or actions described
in this Section shall be payable, on demand, by the Company to Holder and shall
be additional secured obligations under this Note. Without limiting the
generality of the foregoing, such expenses, costs, charges and fees may include:
paralegal fees, costs and expenses; court costs and expenses; photocopying and
duplicating expenses; court reporter fees, costs and expenses; long distance
telephone charges; air express charges; telegram charges; secretarial overtime
charges; and expenses for travel, lodging and food paid or incurred in
connection with the performance of such legal services.

 

5.4. No Waiver by Holder. Holder’s failure, at any time or times, to require
strict performance by the Company of any provision of this Note shall not waive,
affect or diminish any right of Holder thereafter to demand strict compliance
and performance therewith. Any suspension or waiver by Holder of a Default or an
Event of Default shall not suspend, waive or affect any other Default or Event
of Default under this Note whether the same is prior or subsequent thereto and
whether of the same or of a different type. None of the undertakings,
agreements, warranties, covenants and representations of the Company contained
in this Note and no Default or Event of Default by the Company under this Note
shall be deemed to have been suspended or waived by Holder, unless such
suspension or waiver is by an instrument in writing signed by Holder (as such
term is defined in the applicable provision hereof) and directed to the Company
specifying such suspension or waiver. Notwithstanding the foregoing, the
provisions of the Notes may be amended, modified or waived with the written
consent of the Majority Holders, except, the following provisions may not be
amended without the consent of the Holders of all Notes if the effect thereof is
to: (a) extend the scheduled due date for any payment of principal of any of the
Notes; (b) change the currency in which the Notes are payable, or (c) change
this Section 5.4.

 

5.5. Remedies Cumulative. The enumeration of the rights and remedies of KINA and
any Holder set forth in this Note and the other Transaction Documents is not
intended to be exhaustive and the exercise by KINA or any Holder of any right or
remedy shall not preclude the exercise of any other right or remedy herein or in
any of the other Transaction

 

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Documents, all of which shall be cumulative, and shall be in addition to any
other right or remedy given hereunder or thereunder or that may now or hereafter
exist at law or in equity or by suit or otherwise. No delay or failure to take
any action on the part of KINA or any Holder in exercising any right, remedy,
power or privilege shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, remedy, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege or shall be construed to be a waiver of any Default or any
Event of Default. No course of dealing between or among KINA and any of the
Holders, any of the Guarantors, the Company or Holdings shall be effective to
change, modify or discharge any provision of this Note or any of the other
Transaction Documents or to constitute a waiver of any Default or Event of
Default unless such change, modification, discharge or waiver is acknowledged in
writing by KINA and each Holder. Nothing contained in this Note shall release
the Company from any of its obligations under any Transaction Document to which
it is a party except to the extent of amounts irrevocably and indefeasibly paid
under the Transaction Documents in respect of such obligations. The obligations
of the Company hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason (other than the irrevocable and
indefeasible payment in full in cash of the Obligations and as otherwise set
forth herein), and shall not be subject to any defense of set-off or
counterclaim.

 

5.6. WAIVER OF JURY TRIAL. THE COMPANY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS NOTE.

 

5.7. Severability. Wherever possible, each provision of this Note shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Note shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Note.

 

5.8. Parties. This Note shall be binding upon, and inure to the benefit of, the
successors of the Company and Holder and, subject to Section 5.2, the assigns of
Holder.

 

5.9. Authorized Signature. Until Holder shall be notified by the Company to the
contrary, the signature upon any document or instrument delivered pursuant
hereto of any duly elected officer of the Company shall bind the Company and be
deemed to be the act of the Company.

 

5.10. Governing Law. IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, THIS NOTE AND THE OBLIGATIONS ARISING HEREUNDER SHALL
BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE,
WITHOUT REGARD TO THE PRINCIPLES THEREOF REGARDING CONFLICT OF LAWS, AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. Holder and the Company agree to
submit to personal jurisdiction and to waive any objection as to venue in the
federal and state courts of the County of New York, State of New York. Service
of process on the Company or Holder in any action arising out of or relating to
any of the Notes shall be

 

-10-

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effective if mailed to such party in accordance with Section 5.11. Nothing
herein shall preclude Holder or the Company from bringing suit or taking other
legal action in any other jurisdiction.

 

5.11. Notices. All notices, requests, demands, approvals, consents, waivers and
other communications required or permitted to be given under this Note (each, a
“Notice”) shall be in writing and shall be (a) delivered personally, (b) mailed
by first-class, registered or certified mail, return receipt requested, postage
pre-paid, (c) sent by next-day or overnight mail or delivery, or (d) sent by
facsimile transmission, provided that the original copy thereof also is sent by
pre-paid, first class certified or registered mail or by next-day or overnight
mail or personal delivery:

 

(i)   

if to the Company, to:

 

Resorts Real Estate Holdings, Inc.

c/o Resorts International Hotel, Inc.

1133 Boardwalk

Atlantic City, New Jersey

Facsimile:    (609) 340-7896

Attention:    Ms. Audrey Oswell

with copies to:     

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Facsimile:    (212) 728-8111

Attention:    Thomas M. Cerabino, Esq.

(ii)

   if to Holder, to:     

Kerzner International North America, Inc.

c/o Kerzner International Limited

Coral Towers

Paradise Island, The Bahamas

Facsimile:    (242) 363-4581

Attention:    General Counsel

with copies to:     

Proskauer Rose LLP

1585 Broadway

New York, NY 10036

Facsimile:    (212) 969-2900

Attention:    James P. Gerkis, Esq.

 

or, in each case at such other address as may be specified in a Notice to the
Company or Holder, as the case may be. Any Notice shall be deemed effective and
given upon receipt (or intentional refusal of receipt by the addressee of such
Notice).

 

-11-

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5.12. Benefits of Transaction Documents. This Note is entitled to the benefits
of the other Transaction Documents.

 

5.13. Section Titles. The Section titles and Table of Contents contained in this
Note are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.

 

5.14. Exhibits, etc. All exhibits, schedules and annexes to this Note constitute
part of this Note and are hereby incorporated by this reference in this Note.

 

5.15. Purchase Agreement. The payment in full of the outstanding principal
amount of this Note shall constitute the satisfaction in full of the purchase
price payable under the Purchase Agreement.

 

-12-

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IN WITNESS WHEREOF, this Note has been duly executed in New York, New York as of
the date first written above.

 

RESORTS REAL ESTATE HOLDINGS, INC. By:   /s/    NICHOLAS L. RIBIS    

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Name:  Nicholas L. Ribis

Title:    Vice President

 

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Annex 1

 

Certain Definitions and Rules of Interpretation

 

“Affiliate” shall mean, with respect to any Person, any other Person which
directly or indirectly controls, or is under common control with, or is
controlled by, such Person; provided, that the Company shall not be deemed to be
an Affiliate of any Wholly Owned Subsidiary of the Company and no Wholly Owned
Subsidiary of the Company shall be deemed to be an Affiliate of any other Wholly
Owned Subsidiary. As used in this definition, “control” (including, with its
correlative meanings, “controlled by” and “under common control with”) shall
mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise).

 

“Applicable Rate” shall mean (a) 0% per annum for the period from and including
the Issue Date through but excluding September 29, 2004, (b) 4% per annum for
the period from and including September 29, 2004 through but excluding the
second anniversary of the Issue Date, (c) 6% per annum for the period from and
including the second anniversary of the Issue Date through but excluding the
fourth anniversary of the Issue Date, (d) 9% per annum for the period from and
including the fourth anniversary of the Issue Date through but excluding the
fifth anniversary of the Issue Date, and (e) 12% per annum thereafter.

 

“Assignment” shall have the meaning set forth in the Master Agreement.

 

“Business Day” shall mean any day that is not a Saturday, a Sunday or a day on
which banks are required or permitted to be closed in the States of New York or
New Jersey.

 

“Capital Lease” as applied to any person, shall mean any lease of any Property
by that person as lessee which, in conformity with GAAP, is required to be
classified and accounted for as a capital lease on the balance sheet of that
person.

 

“Capital Lease Obligations” shall mean, for any person, all obligations of such
person to pay rent or other amounts under a Capital Lease, and, for purposes of
this Note, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP.

 

“Casino Property” shall have the meaning set forth in the Master Agreement.

 

“CIT Credit Facility” shall have the meaning set forth in the Master Agreement.

 

“CIT Credit Facility Debt” shall mean any Indebtedness incurred under, evidenced
by or relating to the CIT Credit Facility.

 

“CIT Subordination Agreement” shall have the meaning set forth in the Master
Agreement.

 

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“Code” shall mean the Uniform Commercial Code of the jurisdiction with respect
to which such term is used, as in effect from time to time.

 

“Company” shall have the meaning ascribed thereto in the first paragraph of this
Note, together with its successors and permitted assigns, including in
connection with any permitted merger.

 

“Competitor” shall mean any Person that owns or operates a casino in Atlantic
City, New Jersey on the date of transfer of the Note.

 

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

 

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

 

“Eligible Person” shall mean a Person who is, to the extent required under
applicable Gaming Laws, registered or licensed with, approved, qualified or
found suitable by, or not disapproved, denied a license, qualification or
approval or found unsuitable (whichever may be required under applicable Gaming
Law).

 

“Environmental Indemnity Agreement” shall have the meaning set forth in the
Master Agreement.

 

“Equity Interests” shall mean, with respect to any person, any and all shares,
interests, participations or other equivalents, including membership interests
(however designated, whether voting or non-voting), of capital of such person,
including, if such person is

 

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a partnership, partnership interests (whether general or limited) and any other
interest or participation that confers on a person the right to receive a share
of the profits and losses of, or distributions of assets of, such person,
whether outstanding on the Issue Date or issued thereafter.

 

“Event of Default” shall have the meaning set forth in Section 4.1.

 

“First Mortgage” shall have the meaning set forth in the Master Agreement.

 

“GAAP” shall mean generally accepted accounting principles set forth as of the
relevant date in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination. For purposes of clarity, accounts of one party required to be
disclosed in the accounts of another party solely as a result of disclosure
required by the Securities and Exchange Commission under “pushdown” accounting
shall not be treated as the accounts of such other party unless otherwise
required under GAAP.

 

“Gaming Approvals” shall mean all licenses, permits, registrations, authorities,
consents, waivers, orders, findings of suitability or other approvals required
to be obtained from, and all filings, notices or declarations required to be
obtained from, and all filings, notices or declarations required to be made
with, the New Jersey Casino Control Commission (including any successors
thereto) to permit the Company and its Affiliates to conduct the businesses in
the jurisdictions regulated by the New Jersey Casino Control Commission
(including any successors thereto) after the Issue Date in substantially the
same manner as heretofore conducted.

 

“Gaming Authority” means the New Jersey Casino Control Commission and the New
Jersey Division of Gaming Enforcement (including any successors to either of
them), and any other New Jersey governmental authority which regulates gaming in
any jurisdiction in the State of New Jersey in which any of the Resorts Group
Companies conduct gaming activities and has jurisdiction over such persons.

 

“Gaming Law” means any New Jersey Law relating to gaming or gaming activities
established by any Gaming Authority.

 

“Guarantee” shall mean (i) the guarantee dated as of the Issue Date from
Holdings in favor of Holder and the other parties named therein, (ii) the
guarantee dated as of the Issue Date from Resorts, RIH and New Pier in favor of
Holder and the other parties named therein (the “RRN Guarantee”), or (iii) any
guarantee issued by a Subsidiary of Resorts pursuant to Section 5.6 of the
Master Agreement.

 

“Guarantor” shall mean any issuer of a Guarantee.

 

“Holder” shall, unless the context otherwise requires, mean, at any time, any
holder of all or any portion of the Notes at such time, which on the Issue Date
shall be KINA.

 

“Holdings” shall mean Colony RIH Holdings, Inc., a Delaware corporation.

 

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“Indebtedness” of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money; (b) all obligations of such
person evidenced by bonds, debentures, notes or similar instruments; (c) all
obligations of such person under conditional sale or other title retention
agreements relating to property purchased by such person; (d) all obligations of
such person issued or assumed as the deferred purchase price of property or
services (excluding trade accounts payable and accrued obligations incurred in
the ordinary course of business and amounts payable to repurchase Stock in
excess of the amount paid in accordance with Section 5.9 of the Master
Agreement); (e) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on property owned or acquired by such person, whether or
not the obligations secured thereby have been assumed (provided, that if such
obligations have not been assumed, the amount of such Indebtedness included for
the purposes of this definition will be the amount equal to the lesser of the
fair market value of such property and the amount of the Indebtedness secured);
(f) all Capital Lease Obligations (including synthetic lease obligations) and
Purchase Money Obligations of such person; (g) all obligations of such person in
respect of Interest Rate Protection Agreements, foreign currency exchange
agreements or other interest or exchange rate hedging arrangements; (h) all
obligations of such person as an account party in respect of letters of credit
and bankers’ acceptances, except obligations in respect of letters of credit
issued in support of obligations not otherwise constituting Indebtedness shall
not constitute Indebtedness except to the extent such letter of credit is drawn
and not reimbursed within two Business Days; and (i) all Contingent Obligations
of such person in respect of Indebtedness or obligations of others of the kinds
referred to in clauses (a) through (h) above. The Indebtedness of any person
shall include the Indebtedness of any partnership in which such person is a
general partner unless recourse is limited, in which case the amount of such
Indebtedness shall be the limited amount. The amount of Indebtedness of the type
referred to in clause (g) above of any person shall be zero unless and until
such Indebtedness shall be terminated, in which case the amount of such
Indebtedness shall be the then termination payment due thereunder by such
person.

 

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

 

“Indenture” shall mean that certain Indenture dated as of March 22, 2002, among
Resorts, as Issuer, the Guarantors named therein (including RIH and New Pier),
and Bankers Trust Company, as Trustee.

 

“Indenture Notes” shall mean the Notes (as defined in the Indenture).

 

“Issue Date” shall mean [                    ], 2004.

 

“KIL” shall mean Kerzner International Limited, a corporation organized under
The Commonwealth of the Bahamas.

 

“KINA” shall have the meaning ascribed thereto in the first paragraph of this
Note.

 

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“Lease Agreement” shall have the meaning set forth in the Master Agreement.

 

“Lease Amendment” shall have the meaning set forth in the Master Agreement.

 

“Lien” shall mean, with respect to any Property, any mortgage, lien, pledge,
claim, charge, security interest or encumbrance of any kind, any other type of
preferential arrangement in respect of such Property having the effect of a
security interest, including any easement, right-of-way or other encumbrance on
title to Real Property, and any agreement to give any of the foregoing.

 

“Majority Holders” shall mean the holders of at least a majority of the
outstanding principal amount of the Notes.

 

“Master Agreement” shall mean that certain Master Agreement dated as of the
Issue Date, among KINA, the Company, Holdings, Resorts, RIH and New Pier.

 

“Material Adverse Effect”, with respect to a specified Person, shall mean a
material adverse effect on (i) the business, assets, operations or financial or
other condition of such specified Person and its Subsidiaries taken as a whole,
(ii) the Company’s ability to pay the Obligations in accordance with the terms
thereof, or (iii) any Guarantor’s ability to pay any amounts owed by it under
its Guarantee.

 

“Maturity Date” shall mean the date on which principal on the Notes has been
paid in full.

 

“New Jersey Casino Control Act” is set forth in New Jersey Statutes Annotated
5:12-1 et seq. as amended from time to time.

 

“New Jersey Casino Control Commission” is the commission defined in New Jersey
Statutes Annotated 5:12-14 as amended from time to time.

 

“New Pier” shall mean New Pier Operating Company, Inc., a New Jersey
corporation.

 

“Note” and “Notes” shall, unless the context otherwise requires, mean this Note,
including all amendments, modifications and supplements hereto and any notes
delivered in substitution or exchange for such note, and shall refer to the
Notes as the same may be in effect at the time such reference becomes operative.

 

“Notice” shall have the meaning set forth in Section 5.11.

 

“Obligations” shall mean all debts, liabilities, and obligations for monetary
amounts (whether or not such amounts are liquidated or determinable) owing by
the Company and the other Resorts Group Companies to any Holder and arising
under any of the Notes or the other Transaction Documents, and all covenants and
duties regarding such amounts, of any kind or nature, present or future, whether
or not evidenced by any note, agreement or other instrument, arising under any
of the Notes or the other Transaction Documents. This term includes, without
limitation, all interest, charges, expenses, attorneys’ fees and any other sum

 

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chargeable to the Company or any other Resorts Group Company under any of the
Notes or other Transaction Document.

 

“Option Agreement” shall mean the Option Agreement dated as of April 25, 2001,
as amended, between KINA and Resorts.

 

“Permitted CIT Credit Facility Refinancing” shall mean a refinancing of all or a
portion of the CIT Credit Facility Debt that is not inconsistent or in conflict
with the CIT Subordination Agreement, provided that such Permitted CIT Credit
Facility Refinancing may not increase the principal amount of the CIT Credit
Facility Debt and may not permit more than $5,000,000 of the CIT Credit Facility
Debt previously borrowed and repaid to be reborrowed on or after June 30, 2005.

 

“Permitted CIT Credit Facility Refinancing Agreements” shall mean any agreement
or instrument evidencing or relating to any Permitted CIT Credit Facility
Refinancing Debt.

 

“Permitted CIT Credit Facility Refinancing Debt” shall mean the Indebtedness of
RIH incurred solely in connection with a Permitted CIT Credit Facility
Refinancing.

 

“Permitted Indenture Refinancing” shall mean a refinancing of the Indenture
Notes, the sole purpose of which is to reduce the interest rate on the Indenture
Notes, provided that such Permitted Indenture Refinancing may not increase the
principal amount or extend the maturity date of, or otherwise adversely change
the economic terms or other material terms of, the Indenture Notes.

 

“Permitted Indenture Refinancing Agreements” shall mean any agreement or
instrument evidencing or relating to any Permitted Indenture Refinancing Debt.

 

“Permitted Indenture Refinancing Debt” shall mean the Indebtedness of Resorts
incurred solely in connection with a Permitted Indenture Refinancing.

 

“Person” or “person” shall mean any individual, corporation, company, voluntary
association, partnership, limited liability company, joint venture, trust, other
entity, unincorporated organization or government (or any agency,
instrumentality or political subdivision thereof).

 

“Premises” shall have the meaning set forth in the Option Agreement.

 

“Premises Financing” shall mean a financing where a substantial portion of the
net proceeds thereof are projected to be used to develop all or a portion of the
Premises.

 

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

 

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“Purchase Agreement” shall have the meaning set forth in the Master Agreement.

 

“Purchase Money Obligation” shall mean, for any person, the obligations of such
person in respect of Indebtedness incurred for the purpose of financing all or
any part of the purchase price of any Property (including Equity Interests of
any person) or the cost of installation, construction or improvement of any
property or assets and any refinancing thereof; provided, however, that such
Indebtedness is incurred within 135 days after such acquisition of such Property
by such person.

 

“Real Property” shall mean all right, title and interest of any Resorts Group
Company (including, without limitation, any leasehold estate) in and to a parcel
of real property owned or operated by any Resorts Group Company, whether by
lease, license or other use or occupancy agreement, together with, in each case,
all improvements and appurtenant fixtures, equipment, personal property,
easements and other property and rights incidental to the ownership, lease or
operation thereof or thereon.

 

“Resorts” shall mean Resorts International Hotel Casino, Inc. (f/k/a Colony RIH
Acquisitions, Inc.), a Delaware corporation.

 

“Resorts Group Company” shall mean the Company, Holdings, Resorts, RIH, New Pier
and any Subsidiary that issues a Guaranty, individually and, in the plural
usage, collectively.

 

“Restricted Sale or Merger Event” shall mean (i) the occurrence of any event (A)
if the result thereof would constitute an Event of Default (as such term is
defined in the Indenture as in effect on the Issue Date) in respect of the
obligations of Resorts, RIH, New Pier or any New Guarantor under the asset sale
restrictions of Section 4.11 of the Indenture as in effect on the Issue Date, or
(B) Resorts, RIH, New Pier or any New Guarantor shall, directly or indirectly,
in a single transaction or series of related transactions (1) consolidate or
merge with or into another person, or (2) sell, assign, transfer, lease, convey
or otherwise dispose of all or substantially all of its properties, if the
result thereof would constitute an Event of Default (as such term is defined in
the Indenture as in effect on the Issue Date), or (ii) the Casino Property, the
Property (as defined in the First Mortgage) or any substantial part thereof
shall be sold, assigned, transferred, leased, conveyed or otherwise disposed
(“Transferred”), except as permitted by the First Mortgage, whether by Transfer
of assets, by merger, consolidation or amalgamation, by Transfer of stock or
other equity interests, or otherwise (it being understood that Transfer shall be
deemed to include any joint venture or partnership or similar arrangement in
respect of the ownership or use of the Casino Property, the Property (as defined
in the First Mortgage) or any substantial part thereof, the granting to any
Person of an option to cause the Transfer of the Casino Property, the Property
(as defined in the First Mortgage) or any substantial part thereof, or the
entering into of any contract or agreement to Transfer the Casino Property, the
Property (as defined in the First Mortgage) or any substantial part thereof).

 

“RIH” shall mean Resorts International Hotel, Inc., a New Jersey corporation.

 

“Security Agreement” shall have the meaning set forth in Section 3.1.

 

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“Stock” shall mean all shares, options, warrants, general or limited partnership
interests, limited liability company interests, participations or other equity
securities or interests or equivalents (regardless of how designated) of or in a
corporation, partnership, limited liability company or other entity, whether
voting or nonvoting, including, without limitation, common stock, preferred
stock, or any other “equity security” (as such term is defined in Rule 311-1 of
the General Rules and Regulations promulgated under the Exchange Act of 1934, as
amended).

 

“Stock Pledge Agreement” shall have the meaning set forth in Section 3.1.

 

“Subordination Agreement” shall have the meaning set forth in the Master
Agreement.

 

“Subsidiary” shall mean, with respect to any person, any corporation,
partnership or other entity of which at least a majority of the securities or
other ownership interests having by the terms thereof ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions of such corporation, partnership or other entity (irrespective of
whether or not at the time securities or other ownership interests of any other
class or classes of such corporation, partnership or other entity shall have or
might have voting power by reason of the happening of any contingency) is at the
time directly or indirectly owned or controlled by such person and/or one or
more Subsidiaries of such person.

 

“Termination of Option Agreement” shall have the meaning set forth in the Master
Agreement.

 

“Transaction Documents” shall mean the Master Agreement, the Notes, the Purchase
Agreement, the Security Agreement, the Lease Agreement, the Lease Amendment, the
Assignment, the Guarantees, the Stock Pledge Agreement, the Environmental
Indemnity Agreement, the First Mortgage, the Termination of Option Agreement,
the CIT Subordination Agreement and the Subordination Agreement, and, in each
case, all documents related thereto (including any certificate, instrument or
written statement contemplated by or made or delivered pursuant thereto or in
connection therewith) and all exhibits, appendices, schedules and annexes to any
thereof, in each case (unless the context otherwise requires) as the same may be
amended, supplemented or modified from time to time in accordance with its
terms.

 

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