Exhibit 10.1
Execution Version
 
$375,000,000
THIRD AMENDED AND RESTATED
CREDIT AGREEMENT
among
PINNACLE ENTERTAINMENT, INC.,
as Borrower,
The Several Lenders
from Time to Time Parties Hereto,
BANC OF AMERICA SECURITIES LLC and JPMORGAN SECURITIES INC.,
as Joint Lead Arrangers and Joint Book Runners,
BANK OF AMERICA, N.A., JPMORGAN CHASE BANK, N.A.,
CALYON NEW YORK BRANCH, DEUTSCHE BANK TRUST COMPANY AMERICAS
and UBS SECURITIES LLC,
as Syndication Agents,
CAPITAL ONE NATIONAL ASSOCIATION,
as Documentation Agent,
and
BARCLAYS BANK PLC,
as Administrative Agent
Dated as of February 5, 2010
 

 

 

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TABLE OF CONTENTS

              Page  
 
       
SECTION 1. DEFINITIONS
    1  
 
       
1.1 Defined Terms
    1  
1.2 Other Definitional Provisions
    38  
 
       
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
    39  
 
       
2.1 Incremental Term Loans and Incremental Delayed Draw Term Loans
    39  
2.2 Procedure for Incremental Term Loan and Incremental Delayed Draw Term Loan
Borrowing
    40  
2.3 Repayment of Incremental Term Loans and Incremental Delayed Draw Term Loans
    40  
2.4 Revolving Credit Commitments
    40  
2.5 Procedure for Revolving Credit Borrowing
    41  
2.6 Swing Line Commitment
    41  
2.7 Procedure for Swing Line Borrowing; Refunding of Swing Line Loans
    42  
2.8 Incremental Loans
    44  
2.9 Repayment of Loans; Evidence of Debt
    46  
2.10 Commitment Fees, etc.
    47  
2.11 Termination or Reduction of Commitments
    47  
2.12 Optional Prepayments
    48  
2.13 Mandatory Prepayments and Commitment Reductions
    48  
2.14 Conversion and Continuation Options
    51  
2.15 Minimum Amounts and Maximum Number of Eurodollar Tranches
    52  
2.16 Interest Rates and Payment Dates
    52  
2.17 Computation of Interest and Fees
    52  
2.18 Inability to Determine Interest Rate
    53  
2.19 Pro Rata Treatment and Payments
    53  
2.20 Requirements of Law
    56  
2.21 Taxes
    57  
2.22 Indemnity
    59  
2.23 Illegality
    59  
2.24 Change of Lending Office
    60  
2.25 Replacement of Lenders
    60  
2.26 Back-Stop Arrangements
    60  
2.27 Defaulting Lenders
    61  
 
       
SECTION 3. LETTERS OF CREDIT
    63  
 
       
3.1 L/C Commitment
    63  
3.2 Procedure for Issuance of Letter of Credit
    63  
3.3 Fees and Other Charges
    64  
3.4 L/C Participations
    64  

 

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              Page  
 
       
3.5 Reimbursement Obligation of the Borrower
    66  
3.6 Obligations Absolute
    66  
3.7 Letter of Credit Payments
    67  
3.8 Applications
    67  
3.9 Lender Defaults
    67  
 
       
SECTION 4. REPRESENTATIONS AND WARRANTIES
    67  
 
       
4.1 Financial Condition
    67  
4.2 No Change
    68  
4.3 Organizational Existence; Compliance with Law
    68  
4.4 Organizational Power; Authorization; Enforceable Obligations
    69  
4.5 No Legal Bar
    69  
4.6 No Material Litigation
    69  
4.7 No Default
    69  
4.8 Ownership of Property; Liens
    70  
4.9 Intellectual Property
    70  
4.10 Taxes
    70  
4.11 Federal Regulations
    70  
4.12 Labor Matters
    70  
4.13 ERISA
    71  
4.14 Investment Company Act; Other Regulations
    71  
4.15 Subsidiaries
    71  
4.16 Use of Proceeds
    71  
4.17 Environmental Matters
    72  
4.18 Accuracy of Information, etc.
    73  
4.19 Security Documents
    73  
4.20 Solvency
    74  
4.21 Senior Indebtedness
    74  
4.22 Regulation H
    74  
4.23 Gaming Laws
    74  
4.24 Insurance Proceeds
    74  
4.25 Sugarcane Bay Lease
    75  
 
       
SECTION 5. CONDITIONS PRECEDENT
    75  
 
       
5.1 Conditions to Initial Extension of Credit
    75  
5.2 Conditions to Each Extension of Credit
    78  
 
       
SECTION 6. AFFIRMATIVE COVENANTS
    79  
 
       
6.1 Financial Statements
    79  
6.2 Certificates; Other Information; Construction Monitoring
    79  
6.3 Payment of Obligations
    81  
6.4 Conduct of Business and Maintenance of Existence, etc.
    82  
6.5 Maintenance of Property; Insurance
    82  
6.6 Inspection of Property; Books and Records; Discussions
    82  

 

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              Page  
 
       
6.7 Notices
    83  
6.8 Environmental Laws
    83  
6.9 Control Agreements
    84  
6.10 Additional Collateral, etc.
    84  
6.11 Post-Closing Filings with Gaming Boards
    87  
6.12 Further Assurances
    87  
6.13 In Balance Test
    87  
 
       
SECTION 7. NEGATIVE COVENANTS
    88  
 
       
7.1 Financial Condition Covenants
    88  
7.2 Limitation on Indebtedness
    89  
7.3 Limitation on Liens
    92  
7.4 Limitation on Fundamental Changes
    94  
7.5 Limitation on Disposition of Property
    94  
7.6 Limitation on Restricted Payments
    96  
7.7 Limitation on Investments
    96  
7.8 Limitation on Optional Payments and Modifications of Debt Instruments, etc.
    98  
7.9 Limitation on Transactions with Affiliates
    99  
7.10 Limitation on Sales and Leasebacks
    100  
7.11 Limitation on Changes in Fiscal Periods
    100  
7.12 Limitation on Negative Pledge Clauses
    100  
7.13 Limitation on Restrictions on Subsidiary Distributions
    100  
7.14 Limitation on Lines of Business
    101  
7.15 Limitation on Hedge Agreements
    101  
7.16 Limitation on Capital Expenditures
    101  
7.17 Commencement of Construction
    102  
7.18 Limitation on Changes to Deferred Compensation Plan
    103  
7.19 Baton Rouge Project Construction Covenants
    103  
7.20 Construction Covenants
    103  
7.21 Directors’ and Officers’ Trust
    104  
 
       
SECTION 8. EVENTS OF DEFAULT
    104  
 
       
SECTION 9. THE AGENTS
    107  
 
       
9.1 Appointment
    107  
9.2 Delegation of Duties
    107  
9.3 Exculpatory Provisions
    107  
9.4 Reliance by Agents
    108  
9.5 Notice of Default
    108  
9.6 Non-Reliance on Agents and Other Lenders
    108  
9.7 Indemnification
    109  
9.8 Agent in Its Individual Capacity
    109  
9.9 Successor Administrative Agent and Successor Swing Line Lender
    109  

 

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              Page  
 
       
9.10 Authorization to Release Liens and Guarantees and Execute SNDAs
    111  
9.11 The Arrangers
    111  
9.12 Withholding
    111  
 
       
SECTION 10. MISCELLANEOUS
    111  
 
       
10.1 Amendments and Waivers
    111  
10.2 Notices
    113  
10.3 No Waiver; Cumulative Remedies
    115  
10.4 Survival of Representations and Warranties
    115  
10.5 Payment of Expenses
    115  
10.6 Successors and Assigns; Participations and Assignments
    116  
10.7 Adjustments; Set-off
    120  
10.8 Counterparts
    121  
10.9 Severability
    121  
10.10 Integration
    121  
10.11 GOVERNING LAW
    122  
10.12 Submission To Jurisdiction; Waivers
    122  
10.13 Acknowledgments
    122  
10.14 Confidentiality
    122  
10.15 Release of Collateral and Guarantee Obligations
    123  
10.16 Accounting Changes
    124  
10.17 Delivery of Lender Addenda
    124  
10.18 WAIVERS OF JURY TRIAL
    124  
10.19 USA Patriot Act Notification
    124  
10.20 Gaming Laws and Liquor Laws
    125  

ANNEX:

     
A
  Pricing Grid
 
    SCHEDULES:
 
   
1.1(a)
  List of Mortgaged Properties (Leasehold and Fee)
1.1(b)
  List of Preferred Ship Mortgages
1.1(c)
  List of Post-Closing Gaming Pledge Agreement Amendments
1.1(d)
  List of Existing Letters of Credit
4.4
  List of Outstanding Consents, Authorizations, Filings, Proceedings and Notices
4.15(a)
  List of Subsidiaries (Unrestricted and Restricted and Immaterial)
4.15(b)
  List of outstanding subscriptions, options, warrants, calls, rights or other
agreements or commitments
4.19(a)
  UCC Financing Statements Filing Jurisdictions
4.19(b)
  List of Amendments to Mortgages
7.2(d)
  List of Existing Indebtedness
7.3(f)
  List of Existing Liens

 

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7.5(g)
  List of Designated Assets
7.7(d)
  List of Existing Investments

EXHIBITS:

     
A
  Form of Compliance Certificate
B-1
  Form of Lender Addendum
B-2
  Form of New Lender Supplement
B-3
  Form of Incremental Facility Activation Notice
C
  Form of Mortgage
D
  Form of Preferred Ship Mortgage
E
  [RESERVED]
F
  [RESERVED]
G
  [RESERVED]
H
  Form of Borrowing Notice
I-1
  Form of Incremental Term Note
I-2
  Form of Incremental Delayed Draw Term Note
I-3
  Form of Revolving Credit Note
I-4
  Form of Swing Line Note
J
  Form of Exemption Certificate
K
  Form of Closing Certificate
L
  In-Balance Test Certificate
M
  [RESERVED]
N
  [RESERVED]
O
  Form of Assignment and Acceptance
P
  [RESERVED]
Q
  Form of Declining Lender Notice

 

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This THIRD AMENDED AND RESTATED CREDIT AGREEMENT, dated as of February 5, 2010,
among PINNACLE ENTERTAINMENT, INC., a Delaware corporation (the “Borrower”), the
several banks and other financial institutions or entities from time to time
parties to this Agreement, as Lenders, BANC OF AMERICA SECURITIES LLC and
JPMORGAN SECURITIES INC., as joint lead arrangers and joint book runners (in
such capacities, the “Arrangers”), BANK OF AMERICA, N.A., JPMORGAN CHASE BANK,
N.A., CALYON NEW YORK BRANCH, DEUTSCHE BANK TRUST COMPANY AMERICAS and UBS
SECURITIES LLC, as Syndication Agents (in such capacities, the “Syndication
Agents”), CAPITAL ONE NATIONAL ASSOCIATION, as Documentation Agent (in such
capacity, the “Documentation Agent”), and BARCLAYS BANK PLC (“Barclays”), as
administrative agent (in such capacity, the “Administrative Agent”, it being
understood and agreed that any successor administrative agent appointed pursuant
to Section 9.9 hereof shall be the “Administrative Agent”).
W I T N E S S E T H:
A. The Borrower, together with and the other several lenders from time to time
party thereto (the “Existing Lenders”) entered into that existing Second Amended
and Restated Credit Agreement, dated as of December 14, 2005 (the “Original
Credit Agreement”), as amended by (i) that certain First Amendment to the Second
Amended and Restated Credit Agreement, dated as of December 22, 2005, (ii) that
certain Second Amendment to the Second Amended and Restated Credit Agreement,
dated as of October 11, 2006, (iii) that certain Third Amendment to the Second
Amended and Restated Credit Agreement, dated as of November 17, 2006, (iv) that
certain Fourth Amendment to the Second Amended and Restated Credit Agreement,
dated as of July 21, 2009, and (v) that certain Amendment, Resignation, Waiver,
Consent, and Appointment Agreement, dated as of July 24, 2009, each by, among
others, the Borrower, the lenders party thereto, and the Administrative Agent
(collectively, the “Amendments”; the Original Credit Agreement, as amended by
the Amendments, the “Existing Credit Agreement”), pursuant to which the Existing
Lenders agreed to make certain advances to the Borrower; and
B. The Borrower has requested and the Lenders have agreed to amend and restate
the Existing Credit Agreement for the purpose of, among other things,
terminating the existing $750,000,000 revolving credit facility and replacing it
with a $375,000,000 incremental revolving credit facility, such that the
aggregate principal amount of the available credit facilities shall be
$375,000,000, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and the agreements hereinafter
set forth, the parties hereto hereby agree as follows:
SECTION 1.
DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms listed in this Section
1.1 shall have the respective meanings set forth in this Section 1.1.

 

 

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“Accepting Term Loan Lender”: as defined in Section 2.13(f).
“Accounting Change”: as defined in Section 10.16.
“Act”: as defined in Section 10.19.
“Additional Extensions of Credit”: as defined in Section 10.1.
“Adjustment Date”: as defined in Annex A attached hereto.
“Administrative Agent”: as defined in the preamble hereto.
“Administrative Agent Removal”: as defined in Section 9.9(a).
“Administrative Agent Resignation”: as defined in Section 9.9(a).
“Affiliate”: as to any Person, any other Person that, directly or indirectly, is
in control of, is controlled by, or is under common control with, such Person.
For purposes of this definition, “control” of a Person means the power, directly
or indirectly, either to (a) vote 10% or more of the securities having ordinary
voting power for the election of directors (or persons performing similar
functions) of such Person or (b) direct or cause the direction of the management
and policies of such Person, whether by contract or otherwise.
“Agents”: the collective reference to the Arrangers, the Syndication Agents, the
Documentation Agent and the Administrative Agent.
“Aggregate Exposure”: with respect to any Lender at any time, an amount equal to
the sum of (a) the amount of such Lender’s Revolving Credit Commitment then in
effect or, if the Revolving Credit Commitments have been terminated, the amount
of such Lender’s Revolving Extensions of Credit then outstanding; (b) the
aggregate then unpaid principal amount of such Lender’s Incremental Term Loans,
if any; (c) the aggregate then unpaid principal amount of such Lender’s
Incremental Delayed Draw Term Loans, if any; and (d) the amount of such Lender’s
undrawn Incremental Delayed Draw Term Commitments, if any.
“Aggregate Exposure Percentage”: with respect to any Lender at any time, the
ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such
time to the sum of the Aggregate Exposures of all Lenders at such time.
“Agreement”: this Third Amended and Restated Credit Agreement, as amended,
restated, supplemented or otherwise modified from time to time.
“Amendments”: as defined in the recitals.
“Annualized Adjusted EBITDA”: for any period, for the Borrower and its
Restricted Subsidiaries, Consolidated EBITDA for such period plus (a) to the
extent deducted in arriving at Consolidated EBITDA for such period, non-cash
write downs to goodwill required by Financial Accounting Standards Board
Statement No. 142, and any non-cash reductions to the value of the assets of the
Borrower and its Restricted Subsidiaries required by Financial

 

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Accounting Standards Board Statement No. 121 or No. 144, plus (b) the Foreign
Subsidiary Receipts that were (x) received during such period by the Borrower or
any Restricted Subsidiary and (y) irrevocably designated during such period as
Reclassified Foreign Subsidiary Receipts; provided that, for any period ending
on or after the last day of the first full fiscal quarter of operations
following the date of the opening of any Project and ending on or before the
last day of the fourth full fiscal quarter following such opening, that portion
of Consolidated EBITDA which is attributable to the applicable Project shall be
included only for the period consisting of the full fiscal quarters since the
date of such Project’s opening, annualized on a straight-line basis; provided
that for purposes of calculating Annualized Adjusted EBITDA of the Borrower and
its Restricted Subsidiaries for any period, (i) the Consolidated EBITDA of any
Person or operating gaming business or any other business not prohibited by
Section 7.14 hereof acquired by the Borrower or its Restricted Subsidiaries
during such period shall be included on a pro forma basis for such period (as if
the consummation of such acquisition and the incurrence or assumption of any
Indebtedness in connection therewith occurred on the first day of such period)
if the consolidated balance sheet of such acquired Person or business and its
consolidated Subsidiaries as at the end of the period preceding the acquisition
of such Person and the related consolidated statements of income and
stockholders’ equity and of cash flows for the period in respect of which
Consolidated EBITDA is to be calculated (x) have been previously provided to the
Administrative Agent and the Lenders and (y) either (1) have been reported on
without a qualification arising out of the scope of the audit by independent
certified public accountants of nationally recognized standing or (2) have been
found acceptable by the Administrative Agent; and (ii) the Consolidated EBITDA
of any Person Disposed of by the Borrower or its Restricted Subsidiaries during
such period shall be excluded for such period (as if the consummation of such
Disposition and the repayment of any Indebtedness in connection therewith
occurred on the first day of such period).
“Applicable Margin”: for each Type of Loan under the Revolving Credit Facility,
the rate per annum over the Base Rate or Eurodollar Rate, as applicable, set
forth in the relevant column heading on Annex A. For each Type of Loan under
each Incremental Facility established pursuant to this Agreement, the rate per
annum over the Base Rate or Eurodollar Rate, as applicable, set forth in the
Incremental Facility Activation Notice with respect to such Incremental
Facility.
“Application”: an application, in such form as the relevant Issuing Lender may
specify from time to time, requesting such Issuing Lender to issue a Letter of
Credit.
“Argentina Subsidiaries”: Casino Magic Neuquen S.A. and any successors thereto
and any other Subsidiary which is organized under the laws of Argentina and/or
conducts operations primarily in Argentina.
“Arrangers”: as defined in the preamble hereto.
“Asset Sale”: any Disposition of Property or series of related Dispositions of
Property (excluding any such Disposition permitted by clause (a), (b), (c), (d),
(e), (f), (i), (k), (l), (m), (n), (p) and (q) of Section 7.5) which yields
gross proceeds to the Borrower or any of its Restricted Subsidiaries (valued at
the initial principal amount thereof in the case of non-cash

 

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proceeds consisting of notes or other debt securities and valued at fair market
value in the case of other non-cash proceeds), in excess of $2,500,000.
“Assignee”: as defined in Section 10.6(c).
“Assignment and Acceptance”: an agreement pursuant to which a Lender becomes a
party to this Agreement, substantially in the form of Exhibit O, or another form
reasonably acceptable to Administrative Agent.
“Assignor”: as defined in Section 10.6(c).
“Atlantic City Entities”: PNK Development 13, LLC, ACE Gaming, LLC, Mitre
Associates, LLC, Brighton Park Maintenance Corp., AREP Boardwalk Properties LLC,
PSW Properties LLC, and AREH MLK LLC.
“Atlantic City Property”: the approximately 19 acres of land located in Atlantic
City, New Jersey, owned by one or more of the Atlantic City Entities, including
all adjacent and adjoining land along the Boardwalk.
“Available Incremental Delayed Draw Term Commitment”: with respect to any Lender
at any time, an amount equal to the excess, if any, of (a) such Lender’s
Incremental Delayed Draw Term Commitment, if any, then in effect over (b) such
Lender’s Incremental Delayed Draw Term Loans then outstanding.
“Available Revolving Credit Commitment”: with respect to any Revolving Credit
Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s
Revolving Credit Commitment then in effect over (b) such Lender’s Revolving
Extensions of Credit then outstanding; provided, that in calculating any
Lender’s Revolving Extensions of Credit for the purpose of determining such
Lender’s Available Revolving Credit Commitment pursuant to Section 2.10(a), the
aggregate principal amount of Swing Line Loans then outstanding shall be deemed
to be zero.
“Back-Stop Arrangements”: collectively, the Letter of Credit Back-Stop
Arrangements and the Swing Line Back-Stop Arrangements.
“Base Rate”: for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to the greatest of (a) the Prime Rate in effect on
such day, (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of
1% and (c) the sum of the Eurodollar Rate for such day assuming a one-month
Interest Period and 1.00%. For purposes hereof: “Prime Rate” shall mean the
prime lending rate as set forth on the British Banking Association Telerate Page
5 (or such other comparable page as may, in the opinion of the Administrative
Agent, replace such page for the purpose of displaying such rate), as in effect
from time to time. Any change in the Base Rate due to a change in the Prime
Rate, the Federal Funds Effective Rate or the Eurodollar Rate (assuming a
one-month Interest Period) shall be effective as of the opening of business on
the effective day of such change in the Prime Rate, the Federal Funds Effective
Rate or the Eurodollar Rate (assuming a one-month Interest Period),
respectively.

 

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“Base Rate Loans”: Loans for which the applicable rate of interest is based upon
the Base Rate.
“Baton Rouge Project”: the casino and related developments to be located on land
in Baton Rouge, Louisiana.
“Benefited Lender”: as defined in Section 10.7(a).
“Biloxi Property”: the Casino Magic Biloxi hotel and river-boat casino, which
was located in Biloxi, Mississippi.
“Board”: the Board of Governors of the Federal Reserve System of the United
States (or any successor).
“Borrower”: as defined in the preamble hereto.
“Borrowing Date”: any Business Day specified by the Borrower as a date on which
the Borrower requests the relevant Lenders to make Loans hereunder.
“Borrowing Notice”: with respect to any request for borrowing of Loans
hereunder, a written notice from the Borrower, substantially in the form of, and
containing the information prescribed by, Exhibit H, delivered to the
Administrative Agent.
“Business Day”: (a) for all purposes other than as covered by clause (b) below,
a day other than a Saturday, Sunday or other day on which commercial banks in
New York City are authorized or required by law to close and (b) with respect to
all notices and determinations in connection with, and payments of principal and
interest on, Eurodollar Loans, any day which is a Business Day described in
clause (a) and which is also a day for trading by and between banks in Dollar
deposits in the interbank eurodollar market.
“Cabela’s Real Estate Purchase Agreement”: that certain Real Estate Purchase
Agreement, dated as of March 7, 2005, by and between PNK (Reno), LLC, a Nevada
limited liability company, as seller, and Cabela’s Retail, Inc., a Nebraska
corporation, as purchaser, as amended by that certain (a) First Amendment to
Real Estate Purchase Agreement, dated as of May 2, 2005, (b) Second Amendment to
Real Estate Purchase Agreement, dated as of June 2, 2005, and (c) Third
Amendment to Real Estate Purchase Agreement, dated as of July 5, 2005, as the
same may be further amended or amended and restated from time to time.
“Cabela’s Transaction”: the disposition and development of the Cabela’s
Transaction Property by PNK (Reno), LLC and Cabela’s Retail, Inc., as more
particularly described in the Cabela’s Real Estate Purchase Agreement and the
Cabela’s Truck Stop Purchase Agreement.
“Cabela’s Transaction Property”: collectively, (a) approximately thirty-eight
(38) acres of unimproved real property located in the City of Reno, County of
Washoe, Nevada, as more particularly described in the Cabela’s Real Property
Purchase Agreement, and (b) approximately two (2) acres of real property in the
City of Reno, County of Washoe, Nevada

 

5

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on which PNK (Reno), LLC operates a truck stop, as more particularly described
in the Cabela’s Truck Stop Purchase Agreement.
“Cabela’s Truck Stop Purchase Agreement”: that certain Truck Stop Purchase
Agreement, dated as of March 7, 2005, by and between PNK (Reno), LLC, a Nevada
limited liability company, as seller, and Cabela’s Retail, Inc., a Nebraska
corporation, as purchaser, as amended by that certain (a) First Amendment to
Truck Stop Purchase Agreement, dated as of May 2, 2005, (b) Second Amendment to
Trust Stop Purchase Agreement, dated as of June 2, 2005, and (c) Third Amendment
to Truck Stop Purchase Agreement, dated as of July 5, 2005, as the same may be
further amended or amended and restated from time to time.
“Capital Expenditures”: for any period, with respect to any Person, the
aggregate of all expenditures by such Person for the acquisition or leasing
(pursuant to a capital lease) of fixed or capital assets or additions to
equipment (including replacements, capitalized repairs and improvements during
such period) which are required to be capitalized under GAAP on a balance sheet
of such Person.
“Capital Lease Obligations”: with respect to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP; and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.
“Capital Stock”: any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing.
“Cash”: all monetary items treated as cash in accordance with GAAP, consistently
applied.
“Cash Equivalents”: (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States government or issued by any
agency thereof and backed by the full faith and credit of the United States or
issued by FNMA, FHLMC or FFCB, in each case maturing within one year from the
date of acquisition; (b) corporate notes issued by domestic corporations that
are rated at least A by S&P or A by Moody’s, in each case maturing within one
year from the date of acquisition; (c) repurchase obligations of any Lender or
of any commercial bank satisfying the requirements of clause (b) of this
definition, having a term of not more than 30 days with respect to securities
issued or fully guaranteed or insured by the United States Government; (d)
commercial paper of a domestic issuer rated at least A-1 by S&P or P-1 by
Moody’s, maturing within six months of the date of acquisition; (e) securities
with maturities of one year or less from the date of acquisition issued or fully
guaranteed by any state, commonwealth or territory of the United States, by any
political subdivision or taxing authority of any such state, commonwealth or
territory or by any foreign government, the securities of which state,
commonwealth, territory, political subdivision, taxing authority or foreign
government (as the case may be) are rated at least A by S&P or A by Moody’s;
(f) securities with

 

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maturities of one year or less from the date of acquisition backed by standby
letters of credit issued by any Lender or any commercial bank satisfying the
requirements of clause (b) of this definition; (g) auction rate securities
including taxable municipals, taxable auction notes, and money market preferred;
provided that the availability of principal, credit quality, and “reset period”
are consistent with clause (b) of this definition; and (h) shares of money
market mutual or similar funds which invest primarily in assets satisfying the
requirements of clauses (a) through (g) of this definition.
“Change of Control”: the occurrence of any of the following events: (a) any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)), shall become,
or obtain rights (whether by means or warrants, options or otherwise) to become,
the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the
Exchange Act), directly or indirectly, of more than 30% of the outstanding
common stock of the Borrower; (b) the board of directors of the Borrower shall
cease to consist of a majority of Continuing Directors; (c) the Borrower shall
cease, other than pursuant to or as a result of a transaction not otherwise
prohibited by this Agreement, to own and control, of record and beneficially,
directly or indirectly, 100% of each class of outstanding Capital Stock of the
Restricted Subsidiaries listed on Schedule 4.15(a) attached hereto free and
clear of all consensual Liens (except Liens created by the Security Documents or
this Agreement); or (d) a Specified Change of Control.
“Code”: the Internal Revenue Code of 1986, as amended from time to time.
“Collateral”: all Property of the Loan Parties, now owned or hereafter acquired,
upon which a Lien is purported to be created by any Security Document.
“Collateral Proceeds”: as defined in Section 2.13(f).
“Commencement of Construction”: for any Project, the spending from and after
January 1 2010 by the Borrower and its Restricted Subsidiaries of Expenses
(other than amounts expended (x) for land acquisition costs, (y) to obtain a
Gaming License, and (z) for capitalized interest expense) with respect to any
Project of an amount greater than the lesser of (a) $25,000,000 and (b) ten
percent (10%) of the Construction Budget for such Project.
“Commitment”: with respect to any Lender, each of the Revolving Credit
Commitment, Incremental Term Loan Commitment and the Incremental Delayed Draw
Term Commitment, if any, of such Lender.
“Commitment Fee Rate”: with respect to the Revolving Credit Commitment, the
percentage per annum set forth in Annex A.
“Commonly Controlled Entity”: an entity, whether or not incorporated, that is
under common control with the Borrower within the meaning of Section 4001 of
ERISA or is part of a group that includes the Borrower and that is treated as a
single employer under Section 414 of the Code.

 

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“Completion of Construction”: as to any Project, shall be deemed to have
occurred when the items on the Construction Plans for such Project have been
substantially completed except for punch list items.
“Compliance Certificate”: a certificate duly executed by a Responsible Officer,
substantially in the form of Exhibit A.
“Condo Component”: residential housing or mixed-use/retail development or
developments within downtown City of St. Louis to be developed in connection
with the Lumière Property.
“Confidential Information Memorandum”: the Confidential Information Memorandum
dated January 2010 as supplemented prior to the Effective Date and furnished to
the Lenders party hereto as of the Effective Date in connection with the
syndication of the Revolving Credit Facility.
“Consolidated Current Assets”: of any Person at any date, all amounts (other
than Cash, Cash Equivalents and deferred tax accounts) 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 such Person and its Subsidiaries at
such date.
“Consolidated Current Liabilities”: of any Person at any date, all amounts
(other than deferred tax accounts) 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 such Person and its Subsidiaries at such date,
but excluding, with respect to the Borrower, (a) the current portion of any
Funded Debt of the Borrower and its Subsidiaries and (b), without duplication,
all Indebtedness consisting of Revolving Credit Loans or Swing Line Loans, to
the extent otherwise included therein.
“Consolidated EBITDA”: of any Person for any period, Consolidated Net Income of
such Person and its Subsidiaries that are Restricted Subsidiaries for such
period plus, without duplication and to the extent reflected as a charge in the
statement of such Consolidated Net Income for such period, the sum of (a) income
tax expense, (b) Consolidated Interest Expense of such Person and its
Subsidiaries that are Restricted Subsidiaries, amortization or writeoff of debt
discount and debt issuance costs and commissions, discounts and other fees and
charges associated with Indebtedness, (c) depreciation and amortization expense,
(d) amortization and write-off of intangibles (including, but not limited to,
goodwill) and organization costs, (e) any extraordinary, unusual or
non-recurring expenses or losses (including, whether or not otherwise includable
as a separate item in the statement of such Consolidated Net Income for such
period, losses on sales of assets outside of the ordinary course of business),
(f) pre-opening and related promotional expenses incurred in connection with any
Project, (h) any other non-cash charges, and (i) any amount expended after
January 1, 2010 towards the development of businesses not prohibited by
Section 7.l4, in an amount not to exceed $2,500,000 in any fiscal year minus,
without duplication and to the extent included in the statement of such
Consolidated Net Income for such period, the sum of (a) interest income (except
to the extent deducted in determining Consolidated Interest Expense), (b) any
extraordinary, unusual or non-recurring income or gains (including, whether or
not otherwise includable as a separate item in the statement of such

 

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Consolidated Net Income for such period, gains on sales of assets outside of the
ordinary course of business, but not including business interruption insurance
proceeds), and (c) any other non-cash income, all as determined on a
consolidated basis.
“Consolidated Interest Coverage Ratio”: for any period, the ratio of
(a) Annualized Adjusted EBITDA of the Borrower and its Restricted Subsidiaries
for such period to (b) Consolidated Interest Expense for such period.
“Consolidated Interest Expense”: for any period, (a) total interest expense for
such period determined in accordance with GAAP (including that attributable to
Capital Lease Obligations) of the Borrower and its Restricted Subsidiaries for
such period with respect to all outstanding Indebtedness of the Borrower and its
Restricted Subsidiaries (including, without limitation, all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing and net costs under Hedge Agreements in respect of
interest rates to the extent such net costs are allocable to such period in
accordance with GAAP) minus (b) to the extent included in calculating interest
expense pursuant to clause (a), amortization of capitalized interest and debt
issuance costs for such period determined in accordance with GAAP plus
(c) interest required to be capitalized during such period in accordance with
GAAP.
“Consolidated Net Income”: of any Person for any period, the consolidated net
income (or loss) of such Person and its Subsidiaries for such period, determined
on a consolidated basis in accordance with GAAP; provided, that in calculating
Consolidated Net Income of the Borrower and its consolidated Subsidiaries for
any period, there shall be excluded (a) the income (or deficit) of any Person
accrued prior to the date it becomes a Subsidiary of the Borrower or is merged
into or consolidated with the Borrower or any of its Subsidiaries, (b) the
income (or deficit) of any Person (other than a Subsidiary of the Borrower) in
which the Borrower or any of its Subsidiaries has an ownership interest, except
to the extent that any such income is actually received by the Borrower or such
Subsidiary in the form of dividends or similar distributions and (c) the
undistributed earnings of any Subsidiary of the Borrower to the extent that the
declaration or payment of dividends or similar distributions by such Subsidiary
is not at the time permitted by the terms of any Contractual Obligation (other
than under any Loan Document) or Requirement of Law applicable to such
Subsidiary; provided further, that in calculating Consolidated Net Income of the
Borrower and its Subsidiaries for such period (i) any business interruption
insurance received or expected to be received and included in the calculation of
Consolidated Net Income in accordance with GAAP for such period shall be
excluded from Consolidated Net Income and (ii) there shall be included in
Consolidated Net Income for such fiscal quarter the Estimated Business
Interruption Insurance; provided further, that in calculating Consolidated Net
Income of the Borrower and its Subsidiaries for any period, there shall be
excluded from Consolidated Net Income any impairment charge taken as a result of
any insured loss in such period and any portion of the Consolidated Net Income
(in an amount not to exceed the amount of such impairment charge) which relates
to casualty or property insurance received or to be received with respect to the
same insured loss and included in the calculations of Consolidated Net Income in
accordance with GAAP for such period.

 

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“Consolidated Revenues”: for any period, an amount equal to the gross revenues
of the Borrower and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP.
“Consolidated Senior Secured Debt”: at any date, all Consolidated Total Debt as
of such date that is secured by a Lien on any Property of the Borrower and/or
any of its Restricted Subsidiaries.
“Consolidated Senior Secured Debt Ratio”: as of the last day of any period of
four consecutive fiscal quarters, the ratio of (a) Consolidated Senior Secured
Debt less Excess Cash on such day to (b) Annualized Adjusted EBITDA of the
Borrower and its Subsidiaries for such period.
“Consolidated Total Debt”: at any date, the aggregate principal amount of all
Indebtedness (including the undrawn amounts under letters of credit) of the
Borrower and its Restricted Subsidiaries at such date, determined on a
consolidated basis in accordance with GAAP; provided, however, that (a) with
respect to the Indebtedness permitted under Section 7.2(j), such Indebtedness is
only included for purposes of this definition to the extent (if at all) that on
such date the amount of such Indebtedness is greater than the market value of
the assets held in the Rabbi Trust in connection with the Deferred Compensation
Plan by an amount that exceeds $10,000,000; and (b) Consolidated Total Debt
shall not include any Indebtedness that is a long term liability arising solely
as a result of lease payments which, pursuant to the lease with respect to the
River City Property, are not required to be paid in cash until after the opening
of the River City Property for business; provided that the maximum aggregate
amount excluded in this clause (b) shall not exceed $15,000,000.
“Consolidated Total Leverage Ratio”: as of the last day of any period of four
consecutive fiscal quarters, the ratio of (a) Consolidated Total Debt less
Excess Cash on such day to (b) Annualized Adjusted EBITDA of the Borrower and
its Restricted Subsidiaries for such period.
“Consolidated Working Capital”: at any date, the difference of (a) Consolidated
Current Assets of the Borrower on such date less (b) Consolidated Current
Liabilities of the Borrower on such date.
“Construction Budget”: the budget setting forth the costs for construction of
any Project, as such budget may be amended, updated, supplemented, restated
and/or modified at anytime and from time to time.
“Construction Consultant”: for any Project, a consultant from Professional
Associates Construction Services, Inc.; provided however, that Administrative
Agent shall have the right to replace such Construction Consultant for one or
more of the Projects with another construction consultant that is selected by
the Administrative Agent and is reasonably acceptable to the Borrower.
“Construction Plans”: the construction plans and drawings for any Unfinished
Project, as such construction plans may be amended, updated, supplemented,
restated and/or modified at anytime and from time to time.

 

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“Construction Timetable”: the construction timetable for any Unfinished Project,
as such construction timetable may be amended, updated, supplemented, restated
and/or modified at anytime and from time to time.
“Continuing Directors”: the directors of the Borrower on the Effective Date, and
each other director of the Borrower, if, in each case, such other director’s
nomination for election to the board of directors of the Borrower is recommended
by at least a majority of the then Continuing Directors.
“Contractual Obligation”: as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its Property is bound.
“Control Investment Affiliate”: as to any Person, any other Person that
(a) directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person and (b) is organized by such Person primarily
for the purpose of making equity or debt investments in one or more companies.
For purposes of this definition, “control” of a Person means the power, directly
or indirectly, to direct or cause the direction of the management and policies
of such Person, whether by contract or otherwise.
“Cooperative Endeavor Agreement”: that certain Cooperative Endeavor Development
Agreement dated as of November 8, 1999, as amended by an amendment dated as of
April 23, 2003, among the Lake Charles Harbor and Terminal District, the
Calcasieu Parish Police Jury, the City of Lake Charles, Louisiana, and the
Borrower, as further amended, modified or supplemented from time to time.
“Current Interest Period”: as defined in Section 2.1(a).
“Debtor Relief Laws”: the Bankruptcy Code of the United States, and all other
liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
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.
“Declined Term Amount”: as defined in Section 2.13(f).
“Declining Lender Notice”: as defined in Section 2.13(f).
“Declining Term Loan Lender”: as defined in Section 2.13(f).
“Default”: any of the events specified in Section 8, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
“Defaulting Lender”: any Lender that (a) has failed to perform its obligation to
fund any portion of its Loans (or participations in respect of Letters of Credit
or Swing Line Loans) within three (3) Business Days of the date required to be
funded by it hereunder, unless such obligation is the subject of a good faith
dispute as to which such Lender has delivered to the Borrower and the
Administrative Agent a written notice setting forth in reasonable detail the

 

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basis for such dispute; (b) has notified the Borrower, the Administrative Agent
or any Lender in writing that it does not intend to comply with any of its
funding obligations under this Agreement or has made a public statement that it
does not intend to comply with its funding obligations under this Agreement or
generally under other agreements in which it commits to extend credit; (c) has
failed, within three (3) Business Days after written request by the
Administrative Agent, to confirm in a manner reasonably satisfactory to the
Administrative Agent, the Issuing Lenders and the Swing Line Lenders that it
will comply with the terms of this Agreement relating to its obligations to fund
prospective Loans (or participations in respect of Letters of Credit or Swing
Line Loans), (d) otherwise has failed to pay over to the Administrative Agent or
any other Lender any other amount required to be paid by it hereunder within
three Business Days of the date when due, unless the subject of a good faith
dispute as to which such Lender has delivered to the Borrower and the
Administrative Agent a written notice setting forth in reasonable detail the
basis for such dispute, or (e) has, or has a direct or indirect parent company
that has (i) become the subject of a proceeding under any Debtor Relief Law,
(ii) had a receiver, conservator, trustee, administrator, assignee for the
benefit of creditors or similar Person charged with reorganization or
liquidation of its business or a custodian appointed for it, or (iii) taken any
action in furtherance of, or indicating its consent to, approval of or
acquiescence in any such proceeding or appointment; provided that a Lender shall
not be a Defaulting Lender solely by virtue of the ownership or acquisition of
any equity interest in such Lender or any direct or indirect parent company
thereof by a Governmental Authority. A Lender that has become a Defaulting
Lender because of an event referenced in this definition may cure such status
and shall no longer constitute a Defaulting Lender as provided in the last
paragraph of Section 2.27.
“Deferred Compensation Plan”: that certain Hollywood Park, Inc. Executive
Deferred Compensation Plan, originally effective January 1, 2000, as completely
amended and restated effective December, 2004 as the First Amendment and
Restatement of the Pinnacle Entertainment, Inc. Executive Deferred Compensation
Plan, and as further amended and restated effective December, 2007 as the Second
Amendment and Restatement of the Pinnacle Entertainment, Inc. Executive Deferred
Compensation Plan, as it may be further amended, modified or supplemented from
time to time, and the Amended and Restated Hollywood Park, Inc Directors
Deferred Compensation Plan originally effective for 1993, amended and restated
effective December, 2008 as the 2008 AMENDED AND RESTATED PINNACLE
ENTERTAINMENT, INC. DIRECTORS DEFERRED COMPENSATION PLAN, as it may be further
amended, modified or supplemented from time to time.
“Derivatives Counterparty”: as defined in Section 7.6.
“Designated Asset Sale”: any Disposition of any of the assets listed on Schedule
7.5.(g) attached hereto.
“Directors’ and Officers’ Trust”: an irrevocable grantor trust holding funds
deposited by Borrower to fund indemnification obligations to directors and
officers of Borrower and its Subsidiaries.

 

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“Disposition”: with respect to any Property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof; and
the terms “Dispose”, “Disposed” and “Disposed of” shall have correlative
meanings.
“Documentation Agent”: as defined in the preamble hereto.
“Dollars” and “$”: lawful currency of the United States of America.
“Domestic”: as to any Subsidiary, a Subsidiary of the Borrower organized under
the laws of any jurisdiction within the United States of America.
“Effective Date”: February 5, 2010.
“Environmental Laws”: any and all laws, rules, orders, regulations, statutes,
ordinances, guidelines, codes, decrees, or other legally enforceable
requirements (including, without limitation, common law) of any international
authority, foreign government, the United States, or any state, local, municipal
or other governmental authority, regulating, relating to or imposing liability
or standards of conduct concerning protection of the environment or of human
health, or employee health and safety, as has been, is now, or may at any time
hereafter be, in effect.
“Environmental Permits”: any and all permits, licenses, approvals,
registrations, notifications, exemptions and other authorizations required under
any Environmental Law.
“ERISA”: the Employee Retirement Income Security Act of 1974, as amended from
time to time.
“Estimated Business Interruption Insurance”: the amount (determined in good
faith by senior management of the Borrower) of business interruption insurance
the Borrower expects to collect in any applicable period; provided, that
(a) with respect to the damage to the Biloxi Property resulting from Hurricane
Katrina and/or Rita, such amount shall only include amounts through the
four-fiscal quarter period ending on December 31, 2010, and such amount shall
not exceed the lesser of (i) (A) for the four quarter period ending on March 31,
2010, $16,400,000, (B) for the four quarter period ending on June 30, 2010,
$12,300,000, (C) for the four quarter period ending on September 30, 2010,
$8,200,000, and (D) for the four quarter period ending on December 31, 2010,
$4,100,000 and (ii) the sum of (A) $4,100,000 per fiscal quarter, and (B) the
amount of business interruption insurance not reflected in clause (A) that the
Borrower expects to collect as a reimbursement in respect of other expenses
incurred at the Biloxi Property with respect to such fiscal quarter (provided
that the amount included pursuant to this clause (B) shall not exceed the amount
of the other expenses incurred at the Biloxi Property that are actually included
in calculating Consolidated Net Income for such fiscal quarter); and (b) with
respect to damage to any Property (other than the Biloxi Property), such amount
shall not exceed the sum of (i) the historical quarterly Consolidated EBITDA for
the previous four quarters for such Property ending prior to the date the damage
occurred (or annualized if such Property has less than four full quarters of
operations), and (ii) the amount of business interruption insurance not
reflected in clause (i) that the Borrower expects to collect as a reimbursement
in respect of other expenses incurred at such Property with respect to such
period (provided that the amount included pursuant to this clause (ii) shall not
exceed the amount of the

 

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other expenses incurred at such Property that are actually included in
calculating Consolidated Net Income for such fiscal period).
“Eurocurrency Reserve Requirements”: for any day, the aggregate (without
duplication) of the maximum rates (expressed as a decimal or a fraction) of
reserve requirements in effect on such day (including, without limitation,
basic, supplemental, marginal and emergency reserves) under any regulations of
the Board or other Governmental Authority having jurisdiction with respect
thereto dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of the
Board) maintained by a member bank of the Federal Reserve System.
“Eurodollar Base Rate”: with respect to each day during each Interest Period,
the rate per annum determined on the basis of the rate for deposits in Dollars
for a period equal to such Interest Period commencing on the first day of such
Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M.,
London time, two Business Days prior to the beginning of such Interest Period.
In the event that such rate does not appear on Page 3750 of the Telerate screen
(or otherwise on such screen), the “Eurodollar Base Rate” for purposes of this
definition shall be determined by reference to such other comparable publicly
available service for displaying eurodollar rates as may be selected by the
Administrative Agent.
“Eurodollar Loans”: Loans for which the applicable rate of interest is based
upon the Eurodollar Rate.
“Eurodollar Rate”: with respect to each day during each Interest Period, a rate
per annum determined for such day in accordance with the following formula
(rounded upward to the nearest 1/100th of 1%):
Eurodollar Base Rate

1.00 - Eurocurrency Reserve Requirements
“Eurodollar Tranche”: the collective reference to Eurodollar Loans the then
current Interest Periods with respect to all of which begin on the same date and
end on the same later date (whether or not such Loans shall originally have been
made on the same day).
“Event of Default”: any of the events specified in Section 8, provided that any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
“Excess Cash”: as of any date, an amount (but not less than zero) equal to
(a) the total unrestricted Cash and Cash Equivalents of the Borrower and its
Restricted Subsidiaries as of such date minus (b) the Minimum Cash Requirement
as of such date, minus (c) any amounts outstanding under the Revolving Credit
Facility as of such date.
“Excess Cash Flow”: for any fiscal year of the Borrower, the difference, if any,
of (a) the sum, without duplication, of (i) Consolidated Net Income of Borrower
and its Restricted Subsidiaries for such fiscal year, (ii) the amount of all
non-cash charges (including depreciation and amortization) deducted in arriving
at such Consolidated Net Income, (iii) the amount of the decrease, if any, in
Consolidated Working Capital of Borrower and its Restricted Subsidiaries for
such fiscal year, (iv) the aggregate net amount of non-cash loss on the

 

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Disposition of Property by the Borrower and its Subsidiaries during such fiscal
year (other than sales of inventory in the ordinary course of business), to the
extent deducted in arriving at such Consolidated Net Income, (v) the net
increase during such fiscal year (if any) in deferred tax accounts of the
Borrower and its Restricted Subsidiaries, and (vi) all business interruption
insurance actually received in Cash during such fiscal year by Borrower and its
Restricted Subsidiaries minus (b) the sum, without duplication, of (i) the
amount of all non-cash credits included in arriving at such Consolidated Net
Income (including non-cash credits received from business interruption
insurance), (ii) the aggregate amount actually paid by the Borrower and its
Restricted Subsidiaries in Cash during such fiscal year on account of Capital
Expenditures permitted by this Agreement (minus, if there is no Unfinished
Projects during such fiscal year, the principal amount of Indebtedness incurred
during such fiscal year in connection with such expenditures and minus the
amount of any such expenditures financed with the proceeds of any Reinvestment
Deferred Amount), (iii) the aggregate amount of all prepayments of Revolving
Credit Loans and Swing Line Loans during such fiscal year to the extent
accompanying permanent optional reductions of the Revolving Credit Commitments
and all optional prepayments of the Incremental Term Loans and the Incremental
Delayed Draw Term Loans during such fiscal year, (iv) the aggregate amount of
all regularly scheduled principal payments of Funded Debt (including, without
limitation, the Incremental Term Loans and the Incremental Delayed Draw Term
Loans) of the Borrower and its Restricted Subsidiaries made during such fiscal
year (other than in respect of any revolving credit facility to the extent there
is not an equivalent permanent reduction in commitments thereunder), (v) the
amount of the increase, if any, in Consolidated Working Capital of Borrower and
its Restricted Subsidiaries for such fiscal year, (vi) the aggregate net amount
of gain on all Dispositions of Property by the Borrower and its Subsidiaries
during such fiscal year (other than sales of inventory in the ordinary course of
business), to the extent included in arriving at such Consolidated Net Income,
(vii) the net decrease during such fiscal year (if any) in deferred tax accounts
of the Borrower and its Restricted Subsidiaries, and (viii) the Estimated
Business Interruption Insurance.
“Excess Cash Flow Application Date”: as defined in Section 2.13(d).
“Existing Credit Agreement”: as defined in the recitals.
“Existing Lenders”: as defined in the recitals.
“Existing Letters of Credit”: the letters of credit set forth on
Schedule 1.1(d).
“Existing Senior Unsecured Obligations”: the $450,000,000 8.625% Senior Notes
due 2017 of the Borrower issued pursuant to the Indenture dated as of August 10,
2009 among the Borrower, the initial guarantors referred to therein, and The
Bank of New York Mellon Trust Company, N.A., as Trustee, as further amended from
time to time.
“Existing Subordinated Obligations”: the $200,000,000 8.25% Senior Subordinated
Notes due 2012 of the Borrower issued pursuant to the Indenture dated as of
March 15, 2004 among the Borrower, the initial guarantors referred to therein,
and The Bank of New York Mellon Trust Company, N.A., as Trustee, as amended from
time to time; and (b) the $385,000,000 7.50% Senior Subordinated Notes due 2015
of the Borrower issued pursuant to the Indenture dated as of June 8, 2007 among
the Borrower, the initial guarantors referred to therein,

 

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and The Bank of New York Mellon Trust Company, N.A., as Trustee, as further
amended from time to time.
“Existing Unsecured Obligations”: the Existing Senior Unsecured Obligations and
the Existing Subordinated Obligations.
“Expenses”: with regards to any Unfinished Project, the aggregate costs and
expenses (including construction costs, design, FF&E, soft costs, pre-opening
and promotional costs) expended in the construction and development of such
Project in accordance with the applicable Construction Plans and the applicable
Construction Budget.
“Facility”: each of the Revolving Credit Facility, each Incremental Revolving
Facility, each Incremental Term Facility and each Incremental Delayed Draw Term
Facility.
“Fair Value Determination”: with respect to any Disposition of Property, a
determination by the management of the Borrower, that such Disposition, taking
into account all current consideration and direct and indirect future benefits
anticipated to be received by the Borrower and its Subsidiaries in connection
with such Disposition, is a reasonable and good faith exercise of business
judgment.
“Federal Funds Effective Rate”: for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published on the next succeeding
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 for
the day of such transactions received by the Administrative Agent from three
federal funds brokers of recognized standing selected by it.
“Financial Condition Covenants”: the covenants of the Borrower set forth in
Section 7.1.
“Foreign”: as to any Subsidiary, a Subsidiary of the Borrower that is not a
Domestic Subsidiary.
“Foreign Subsidiary Receipts”: any dividend, distribution, payment,
reimbursement or other amounts received in Cash from any Foreign Unrestricted
Subsidiary of the Borrower by the Borrower or any Restricted Subsidiary.
“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with
respect to the Issuing Lenders, such Defaulting Lender’s Revolving Credit
Percentage of the outstanding L/C Obligations other than L/C Obligations as to
which (i) such Defaulting Lender’s participation obligation has been reallocated
pursuant to Section 2.27(d), or (ii) Letter of Credit Back Stop Arrangements
shall have been provided in accordance with Section 3.9, and (b) with respect to
the Swing Line Lender, such Defaulting Lender’s Revolving Credit Percentage of
Swing Line Loans other than Swing Line Loans as to which (i) such Defaulting
Lender’s participation obligation has been reallocated pursuant to
Section 2.27(d), or (ii) Swing Line Back-Stop Arrangements shall have been
provided in accordance with Section 2.7.

 

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“Funded Debt”: with respect to any Person, all Indebtedness of such Person of
the types described in clauses (a) through (e) of the definition of
“Indebtedness” in this Section, excluding any Indebtedness described in
Section 7.2(j).
“Funding Office”: the office specified from time to time by the Administrative
Agent as its funding office by notice to the Borrower and the Lenders.
“GAAP”: generally accepted accounting principles in the United States of America
as in effect from time to time, except that for purposes of Section 7.1 and
subject to Section 10.16, GAAP shall be determined on the basis of such
principles used in the preparation of the December 31, 2008 audited financial
statements.
“Gaming Board”: collectively, (a) the California Attorney General (acting
pursuant to the California Gambling Control Act), (b) the Nevada Gaming
Commission, (c) the Nevada State Gaming Control Board, (d) the Indiana Gaming
Commission, (e) the Mississippi Gaming Commission, (f) the Louisiana Gaming
Control Board, (g) the Missouri Gaming Commission, and (h) any other
Governmental Authority that holds regulatory, licensing or permit authority over
gambling, gaming or casino activities conducted or proposed to be conducted by
the Borrower and its Subsidiaries.
“Gaming Laws”: all Laws pursuant to which any Gaming Board possesses regulatory,
licensing or permit authority over gambling, gaming or casino activities
conducted by the Borrower and its Subsidiaries.
“Gaming License”: in any jurisdiction in which the Borrower or any of its
Subsidiaries conducts or proposes to conduct any casino and gaming business or
activities, any license, permit or other authorization to conduct gaming
activities that is granted or issued by the applicable Gaming Board for such
business activities.
“Governmental Authority”: any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government,
including, without limitation, the Gaming Boards and Liquor Authorities.
“Guarantee Obligation”: as to any Person (the “guaranteeing person”), any
obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit), if to induce the
creation of such obligation of such other Person the guaranteeing person has
issued a reimbursement, counterindemnity or similar obligation, in either case
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or
other obligations (the “primary obligations”) of any other third Person (the
“primary obligor”) in any manner, whether directly or indirectly, including,
without limitation, any obligation of the guaranteeing person, whether or not
contingent, (i) to purchase any such primary obligation or any Property
constituting direct or indirect security therefor, (ii) to advance or supply
funds (1) for the purchase or payment of any such primary obligation or (2) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) 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

 

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obligor to make payment of such primary obligation or (iv) otherwise to assure
or hold harmless the owner of any such primary obligation against loss in
respect thereof; provided, however, that the term Guarantee Obligation shall not
include endorsements of instruments for deposit or collection in the ordinary
course of business. The amount of any Guarantee Obligation of any guaranteeing
person shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person’s
maximum reasonably anticipated liability in respect thereof as determined by the
Borrower in good faith.
“Guarantors”: the collective reference to the Subsidiary Guarantors.
“Hedge Agreements”: all interest rate or currency swaps, caps or collar
agreements, foreign exchange agreements, commodity contracts or similar
arrangements entered into by the Borrower or its Subsidiaries providing for
protection against fluctuations in interest rates, currency exchange rates,
commodity prices or the exchange of nominal interest obligations, either
generally or under specific contingencies.
“Hotel Agreements”: (a) a franchise/license agreement, a management agreement
and other related agreements (including an information technology agreement), by
the Borrower or its Restricted Subsidiary in connection with operation and
management of the hotel that is part of the Lumière Property, in the form of the
customary franchise or management agreement for the applicable franchisor or
manager or such other form as shall be reasonably acceptable to the
Administrative Agent; and (b) the other franchise/license agreements, management
agreements and other related agreements, including, without limitation,
information technology agreements, entered into by the Borrower or its
Restricted Subsidiaries in connection with the operation and management of an
existing hotel, or a hotel to be built as part of any potential development
project of the Borrower or its Restricted Subsidiaries, in the form of the
customary franchise or management agreement for the applicable franchisor or
manager or such other form as shall be reasonably acceptable to the
Administrative Agent.
“Identified Project”: any Project which has a specific basket for Capital
Expenditures under and pursuant to Section 7.16.
“Immaterial Subsidiaries”: any Subsidiary of the Borrower or its Restricted
Subsidiaries that does not (i) hold or own assets with an aggregate net book
value of greater than $5,000,000 and (ii) hold any Gaming Licenses.
“In-Balance Projections”: with respect to any In-Balance Test, good faith
projections of the Consolidated EBITDA of the Borrower and its Restricted
Subsidiaries for the period from the first day of the calendar month in which
In-Balance Test is being made through the end of the Project Period for the
applicable Project.

 

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“In-Balance Test”: with respect to any Project, the test to determine whether,
as of any date, the Project Sources exceed the Project Uses for such Project
(and for all other Unfinished Projects) for the Project Period for such Project.
“In-Balance Test Certificate”: with respect to any Project, an officer’s
certificate, in substantially the form of the attached Exhibit L, setting forth
the calculation of the Project Sources and the Project Uses for such Project as
of the date of such certificate.
“Incremental Delayed Draw Term Commitment”: as to any Lender a Commitment to
make an Incremental Delayed Draw Term Facility.
“Incremental Delayed Draw Term Commitment Period”: with respect to any
Incremental Delayed Draw Term Facility, the commitment period for such
Incremental Delayed Draw Term Facility.
“Incremental Delayed Draw Term Facilities”: as defined in Section 2.8(a).
“Incremental Delayed Draw Term Lender”: each Lender that has an Incremental
Delayed Draw Term Commitment or that is the holder of Incremental Delayed Draw
Term Loans.
“Incremental Delayed Draw Term Loans”: Incremental Loans under an Incremental
Delayed Draw Term Facility.
“Incremental Delayed Draw Term Maturity Date”: for any Incremental Delayed Draw
Term Loan, the maturity date for such Incremental Delayed Draw Term Loan as set
forth in the applicable Incremental Facility Activation Notice (or such earlier
date on which such Incremental Delayed Draw Term Loan becomes due and payable
pursuant to Section 8).
“Incremental Delayed Draw Term Percentage”: as to any Incremental Delayed Draw
Term Lender at any time, the percentage which the sum of such Lender’s unfunded
Incremental Delayed Draw Term Commitment plus the aggregate principal amount of
such Lender’s Incremental Delayed Draw Term Loans then outstanding constitutes
of the sum of the aggregate unfunded Incremental Delayed Draw Term Commitments
and the aggregate principal amount of the Incremental Delayed Draw Term Loans
then outstanding.
“Incremental Delayed Draw Term Note”: as described in Section 2.9(e).
“Incremental Facilities”: as defined in Section 2.8(a).
“Incremental Facility Activation Notice”: a notice substantially in the form of
Exhibit B-3.
“Incremental Facility Amendments”: as defined in Section 2.8(a).
“Incremental Facility Effective Date”: as defined in Section 2.8(a).

 

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“Incremental Loans”: additional Loans or Additional Extensions of Credit made
pursuant to any Incremental Facility.
“Incremental Revolving Credit Commitments”: as defined in Section 2.8(a).
“Incremental Revolving Facilities”: as defined in Section 2.8(a).
“Incremental Revolving Facility Commitment”: as to any Lender a Commitment to
make an Incremental Revolving Facility.
“Incremental Revolving Loans”: Incremental Loans under an Incremental Revolving
Facility.
“Incremental Term Commitment”: as to any Lender a Commitment to make an
Incremental Term Facility.
“Incremental Term Facilities”: as defined in Section 2.8(a).
“Incremental Term Lender”: each Lender that has an Incremental Term Commitment
or that is the holder of Incremental Term Loans.
“Incremental Term Loans”: Incremental Loans under an Incremental Term Facility.
“Incremental Term Maturity Date”: for any Incremental Term Loan, the maturity
date for such Incremental Term Loan as set forth in the applicable Incremental
Facility Activation Notice (or such earlier date on which such Incremental Term
Loan becomes due and payable pursuant to Section 8).
“Incremental Term Note”: as described in Section 2.9(e).
“Incremental Term Percentage”: as to any Incremental Term Lender at any time,
the percentage which such Lender’s Term Loans then outstanding constitutes of
the aggregate principal amount of the Term Loans then outstanding.
“Indebtedness”: of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money (other than chip and token
liability incurred in the ordinary course of such Person’s business), (b) all
obligations of such Person for the deferred purchase price of Property or
services (other than trade payables and accrued expenses that are current
liabilities), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness 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), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party or applicant under acceptance, letter of credit or similar
facilities, (g) all obligations of such Person, contingent or otherwise, to
purchase, redeem, retire or otherwise acquire for value any Capital Stock of
such Person, (h) all Guarantee Obligations of such Person in respect of
obligations of

 

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the kind referred to in clauses (a) through (g) above; (i) all obligations of
the kind referred to in clauses (a) through (h) above secured by (or for which
the holder of such obligation has an existing right, contingent or otherwise, to
be secured by) any Lien on Property (including, without limitation, accounts and
contract rights) owned by such Person, whether or not such Person has assumed or
become liable for the payment of such obligation and (j) for the purposes of
Section 8(e) only, all obligations of such Person in respect of Hedge
Agreements.
“Indemnified Liabilities”: as defined in Section 10.5.
“Indemnitee”: as defined in Section 10.5.
“Indentures”: collectively, the Senior Subordinated Indentures and the Senior
Unsecured Indentures.
“Indiana Power of Attorney”: a power of attorney required, pursuant to
applicable Requirements of Law, to be entered into by the Borrower or any of its
Restricted Subsidiaries by the Indiana Gaming Commission.
“Insolvency”: with respect to any Multiemployer Plan, the condition that such
Plan is insolvent within the meaning of Section 4245 of ERISA.
“Insolvent”: pertaining to a condition of Insolvency.
“Intellectual Property”: the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including, without
limitation, copyrights, copyright licenses, patents, patent licenses,
trademarks, trademark licenses, technology, know-how and processes, and all
rights to sue at law or in equity for any infringement or other impairment
thereof, including the right to receive all proceeds and damages therefrom.
“Interest Payment Date”: (a) as to any Base Rate Loan, the last day of each
March, June, September and December to occur while such Loan is outstanding and
the final maturity date of such Loan, (b) as to any Eurodollar Loan having an
Interest Period of three months or shorter, the last day of such Interest
Period, and (c) as to any Eurodollar Loan having an Interest Period longer than
three months, each day that is three months, or a whole multiple thereof, after
the first day of such Interest Period and the last day of such Interest Period.
“Interest Period”: as to any Eurodollar Loan, (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with respect
to such Eurodollar Loan and ending one, two, three or six months thereafter, as
selected by the Borrower in its notice of borrowing or notice of conversion, as
the case may be, given with respect thereto; and (b) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Eurodollar Loan and ending one, two, three or six months thereafter, as
selected by the Borrower by irrevocable notice to the Administrative Agent not
less than three Business Days prior to the last day of the then current Interest
Period with respect thereto; provided that, all of the foregoing provisions
relating to Interest Periods are subject to the following:

 

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(a) if any Interest Period would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;
(b) any Interest Period that would otherwise extend beyond the Revolving Credit
Termination Date or beyond the date final payment is due on any Incremental Term
Loans or Incremental Delayed Draw Term Loans, as the case may be, shall end on
the Revolving Credit Termination Date or such due date, as applicable; and
(c) any Interest Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last Business Day of
the calendar month at the end of such Interest Period.
“Investments”: as defined in Section 7.7.
“Issuing Lender”: (a) solely with respect to the Existing Letters of Credit,
Wells Fargo Bank, N.A., and (b) otherwise any Revolving Credit Lender from time
to time designated by the Borrower as an Issuing Lender with the consent of such
Revolving Credit Lender and notice to the Administrative Agent, subject to
Section 9.9(c) hereof, as applicable.
“L/C Commitment”: $75,000,000.
“L/C Fee Payment Date”: the last day of each March, June, September and December
and the Revolving Credit Termination Date.
“L/C Obligations”: at any time, an amount equal to the sum of (a) the aggregate
then undrawn and unexpired amount of the then outstanding Letters of Credit and
(b) the aggregate amount of drawings under Letters of Credit that have not then
been reimbursed pursuant to Section 3.5.
“L/C Participants”: with respect to any Letter of Credit, the collective
reference to all the Revolving Credit Lenders other than the Issuing Lender that
issued such letter of Credit.
“Laws”: collectively, all international, foreign, federal, state and local
statutes, treaties, rules, regulations, ordinances, codes and administrative or
judicial precedents, including, without limitation, Gaming Laws.
“Lender Addendum”: with respect to any initial Lender, a Lender Addendum,
substantially in the form of Exhibit B-1, to be executed and delivered by such
Lender on the Effective Date as provided in Section 10.17.
“Lenders”: collectively, the Revolving Credit Lenders, the Incremental Term
Lenders, if any, and the Incremental Delayed Draw Term Lenders, if any, and
includes the Issuing Lenders (unless the context otherwise requires).

 

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“Letter of Credit Back-Stop Arrangements”: as defined in Section 3.9.
“Letters of Credit”: as defined in Section 3.1(a).
“License Revocation”: the revocation, failure to renew, suspension of, refusal
to issue, or the appointment of a receiver, supervisor or similar official with
respect to, any Gaming License covering any present or reasonably proposed
casino or gaming facility of Borrower or any Restricted Subsidiary.
“Lien”: any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge or other security interest or any
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement and any capital lease having
substantially the same economic effect as any of the foregoing).
“Liquor Authorities”: in any jurisdiction in which the Borrower or any of its
Subsidiaries sells and/or distributes beer, wine or liquor, or proposes to sell
and/or distribute beer, wine or liquor, the applicable alcoholic beverage
commission or other Governmental Authority responsible for interpreting,
administering or enforcing the Liquor Laws.
“Liquor Laws”: the laws, rules, regulations and orders applicable to or
involving the sale and/or distribution of beer, wine or liquor by the Borrower
or any of its Subsidiaries in any jurisdiction, as in effect from time to time,
including the policies, interpretations or administration thereof by the
applicable Liquor Authorities.
“Liquor License”: in any jurisdiction in which the Borrower or any of its
Subsidiaries sells and/or distributes beer, wine or liquor, or proposes to sell
and/or distribute beer, wine or liquor, any license, permit or other
authorization to sell and distribute beer, wine or liquor that is granted or
issued by the Liquor Authorities.
“Loan”: any loan made by any Lender pursuant to this Agreement.
“Loan Documents”: this Agreement, the Subsidiary Guaranty, the Security
Documents, the Applications and the Notes.
“Loan Parties”: the Borrower and each Subsidiary of the Borrower that is a party
to a Loan Document.
“Lumière Property”: the complex known as Lumière Place located in downtown St.
Louis, Missouri, including the Lumière Place Casino and the Four Seasons Hotel
St. Louis.
“Maintenance Capital Expenditures”: Capital Expenditures that are incurred to
maintain, restore, refurbish or replace fixed or capital assets or equipment of
the Borrower and its Restricted Subsidiaries.`
“Majority Facility Lenders”: with respect to (a) the Revolving Credit Facility,
the holders of more than 50% of the aggregate unpaid principal amount of the
Total Revolving Extensions of Credit outstanding under the Revolving Credit
Facility (or, prior to any

 

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termination of the Revolving Credit Commitments, the holders of more than 50% of
the Total Revolving Credit Commitments); (b) any Incremental Term Facility, the
holders of more than 50% of the aggregate unpaid principal amount of the
Incremental Term Loans outstanding under such Incremental Term Facility; (c) any
Incremental Delayed Draw Term Facility, the holders of more than 50% of the
aggregate unpaid principal amount of the Incremental Delayed Draw Term Loans and
unfunded Incremental Delayed Draw Term Commitments under such Incremental
Delayed Draw Term Facility; or (d) any Incremental Revolving Facility, the
holders of more than 50% of the aggregate unpaid principal amount of the
Incremental Revolving Loans and unfunded Incremental Revolving Facility
Commitments under such Incremental Revolving Facility.
“Majority Revolving Credit Facility Lenders”: the Majority Facility Lenders in
respect of the Revolving Credit Facility.
“Material Adverse Effect”: a material adverse effect on (a) the business,
assets, property, condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole, (b) the validity or
enforceability of this Agreement, the Subsidiary Guarantee, the Notes, the
Security Documents (including amendments thereto), taken as a whole, or the
other Loan Documents (including amendments thereto), taken as a whole, or the
rights or remedies of the Agents or the Lenders under this Agreement, the
Subsidiary Guarantee, the Notes, the Security Documents (including amendments
thereto), taken as a whole, or the other Loan Documents (including amendments
thereto), taken as a whole, or (c) on the ability of the Borrower and the Loan
Parties to fulfill their obligations under the Loan Documents.
“Materials of Environmental Concern”: any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products, polychlorinated biphenyls,
urea-formaldehyde insulation, asbestos, pollutants, contaminants, radioactivity,
and any other substances or forces of any kind, whether or not any such
substance or force is defined as hazardous or toxic under any Environmental Law,
that is regulated pursuant to or could give rise to liability under any
Environmental Law.
“Maximum Foreign Subsidiary Investment Amount”: as of any date of determination,
the sum of (a) $1,500,000; plus (b) all amounts received by the Borrower or any
Restricted Subsidiary as Foreign Subsidiary Receipts after August 27, 2004
through such date of determination, minus (c) all Reclassified Foreign
Subsidiary Receipts.
“Minimum Cash Requirement”: as of any date, the sum as of such date of (a)
$65,000,000 plus (b) on any date after the Sugarcane Bay Project opens,
$10,000,000 plus (c) on any date after the Baton Rouge Project opens,
$10,000,000 plus (d) on any date after the River City Property Project opens,
$10,000,000 plus (e) $10,000,000 for each Material Operating Property which
opened after the Effective Date and prior to such date plus (f) $10,000,000 for
each Material Operating Property which was acquired after the Effective Date and
prior to such date minus (g) $10,000,000 for each Material Operating Property
which was Disposed of or otherwise ceased operations after the Effective Date
and prior to such date. For purposes of this definition, “Material Operating
Property” means (i) the Reno Property or (ii) any other Property which either
was acquired for $100,000,000 or more or had a construction budget of
$100,000,000 or more and at which gaming operations are conducted.

 

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“Monthly Construction Progress Report”: as defined in Section 6.2(i).
“Moody’s”: Moody’s Investors Service, Inc.
“Mortgaged Properties”: the real properties listed on Schedule 1.1(a) as and
when the Administrative Agent for the benefit of the Secured Parties is granted
a Lien pursuant to one or more Mortgages in accordance with the terms of this
Agreement.
“Mortgages”: collectively, (a) each of the mortgages and deeds of trust made by
any Loan Party in favor of, or for the benefit of, the Administrative Agent for
the benefit of the secured parties, (b) each of the amended and restated
mortgages and deeds of trust made by any Loan Party in favor of, or for the
benefit of, the Administrative Agent for the benefit of the secured parties, and
(c) any other mortgages or deeds of trust which are made by any Loan Party in
favor of the Administrative Agent from time to time in accordance with this
Agreement, which mortgages and deeds of trust shall be substantially in the form
of Exhibit C, in each case with such changes thereto as shall be advisable under
the law of the jurisdiction in which such mortgages and deeds of trust are to be
recorded and in each case as the same may be further amended, amended and
restated, restated, supplemented or otherwise modified from time to time.
“Multiemployer Plan”: a Plan that is a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
“Net Cash Proceeds”: (a) in connection with any Asset Sale, any Recovery Event
or any Designated Asset Sale, the proceeds thereof in the form of Cash and Cash
Equivalents (including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received) of such Asset
Sale, Recovery Event or Designated Asset Sale, net of attorneys’ fees,
accountants’ fees, investment banking fees, amounts required to be applied to
the repayment of Indebtedness secured by a Lien expressly permitted hereunder on
any asset which is the subject of such Asset Sale, Recovery Event or Designated
Asset Sale (other than any Lien pursuant to a Security Document) and other
customary fees and expenses actually incurred in connection therewith and net of
taxes paid or reasonably estimated to be payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing
arrangements); and (b) in connection with any issuance or sale of equity
securities or debt securities or instruments or the incurrence of loans, the
Cash proceeds received from such issuance or incurrence, net of attorneys’ fees,
investment banking fees, accountants’ fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred in
connection therewith.
“Net Disposition Proceeds”: in connection with any Disposition, the proceeds
thereof in the form of Cash and Cash Equivalents (including any such proceeds
received by way of deferred payment of principal pursuant to a note or
installment receivable or purchase price adjustment receivable or otherwise, but
only as and when received) of such Disposition, net of attorneys’ fees,
accountants’ fees, investment banking fees, amounts required to be applied to
the repayment of Indebtedness secured by a Lien expressly permitted hereunder on
any asset which is the subject of such Disposition (other than any Lien pursuant
to a Security Document) and

 

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other customary fees and expenses actually incurred in connection therewith and
net of taxes paid or reasonably estimated to be payable as a result thereof
(after taking into account any available tax credits or deductions and any tax
sharing arrangements).
“New Capital Adjusted Proceeds”: as of any date, (a) the New Capital Available
Proceeds as of such date minus (b) the New Capital Asset Disposition Proceeds as
of such date minus (c) any portion of the New Capital Available Proceeds (other
than New Capital Asset Disposition Proceeds) that as of such date has resulted,
or will result, in an increase to Consolidated EBITDA; provided that if New
Capital Adjusted Proceeds have been included as Project Sources in satisfying
the In-Balance Test for any Identified Project with a separate and specified
Capital Expenditure basket, the amount of New Capital Adjusted Proceeds so
included in Project Sources may not also be applied to Capital Expenditures
under Section 7.16(c) or to Investments under Section 7.7(k).
“New Capital Asset Disposition Proceeds”: as of any date, the Net Disposition
Proceeds received by the Borrower and its Restricted Subsidiaries on or after
January 1, 2010 and prior to such date from Recovery Events and Dispositions of
Property other than those permitted pursuant to clause (b), (d), (f), (k),
(l) and (o) of Section 7.5.
“New Capital Available Proceeds”: as of any date, the sum of (a) New Capital
Asset Disposition Proceeds as of such date; (b) the amount of tax refunds
received by the Borrower and its Restricted Subsidiaries in Cash and/or Cash
Equivalents on or after January 1, 2010 and prior to such date; (c) the amount
of litigation settlements and/or awards received in cash (net of the expenses
incurred to obtain such litigation settlements and/or awards) by the Borrower
and its Restricted Subsidiaries on or after January 1, 2010 and prior to such
date; (d) the amount of gross proceeds received by the Borrower from the
issuance and sale of the Borrower’s Capital Stock (other than Capital Stock
which is Indebtedness); and (e) with respect to each Unrestricted Subsidiary for
which cash dividends and distributions are received by the Borrower and/or its
Restricted Subsidiaries from such Unrestricted Subsidiary on or after January 1,
2010 and prior to such date is in excess of the Investments (excluding
Investments made pursuant to Section 7.7(k)) made by the Borrower and/or its
Restricted Subsidiaries in such Unrestricted Subsidiary on or after January 1,
2010 and prior to such date, the amount of such excess.
“New Lender”: as defined in Section 2.8(d).
“New Lender Supplement”: as defined in Section 2.8(d).
“New Subordinated Obligations”: unsecured subordinated Indebtedness of the
Borrower that (a) does not have any scheduled principal payment, mandatory
principal prepayment or sinking fund payment due prior to the date that is six
months following the latest of the Incremental Term Maturity Date, Incremental
Delayed Draw Term Maturity Date and Revolving Credit Termination Date, (b) is
not secured by any Lien on the Property of Borrower or any of its Subsidiaries,
and (c) is otherwise on terms (except for pricing) which are (i) in the
aggregate not more favorable to the holders of such Indebtedness than those
contained in the Existing Subordinated Obligations as in effect on the date
hereof in any manner which is detrimental to the Agents or the Lenders or
substantially identical thereto (in each case, as

 

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determined by the Administrative Agent in its discretion) or (ii) otherwise
approved by the Required Lenders; provided, however, for purposes of this clause
(c) Borrower shall be permitted to incur convertible subordinated debt on terms
reasonably acceptable to the Administrative Agent and otherwise in compliance
with clauses (a) and (b) above.
“Non-Excluded Taxes”: as defined in Section 2.21(a).
“Non-U.S. Lender”: as defined in Section 2.21(d).
“Note”: any promissory note evidencing any Loan.
“Notice Period”: as defined in Section 9.9(a).
“Obligations”: the unpaid principal of and interest on (including, without
limitation, interest accruing after the maturity of the Loans and Reimbursement
Obligations and interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) the Loans, the
Reimbursement Obligations and all other obligations and liabilities of the
Borrower to the Administrative Agent or to any Lender or any Qualified
Counterparty, whether direct or indirect, absolute or contingent, due or to
become due, or now existing or hereafter incurred, which may arise under, out
of, or in connection with, this Agreement, any other Loan Document, the Letters
of Credit, any Specified Hedge Agreement or any other document made, delivered
or given in connection herewith or therewith, whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses
(including, without limitation, all fees, charges and disbursements of counsel
to the Administrative Agent or to any Lender that are required to be paid by the
Borrower pursuant hereto) or otherwise; provided, that (i) obligations of the
Borrower or any Subsidiary under any Specified Hedge Agreement shall be secured
and guaranteed pursuant to the Security Documents only to the extent that, and
for so long as, the other Obligations are so secured and guaranteed and (ii) any
release of Collateral or Guarantors effected in the manner permitted by this
Agreement shall not require the consent of holders of obligations under
Specified Hedge Agreements.
“Original Credit Agreement”: as defined in the recitals.
“Other Taxes”: any and all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document.
“Participant”: as defined in Section 10.6(b).
“Participant Register”: as defined in Section 10.6(b).
“Payment Amount”: as defined in Section 3.5.
“Payment Office”: the office specified from time to time by the Administrative
Agent as its payment office by notice to the Borrower and the Lenders.

 

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“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).
“Permitted Refinancing Subordinated Notes”: the notes evidencing the Permitted
Refinancing Subordinated Obligations.
“Permitted Refinancing Subordinated Obligations”: unsecured Indebtedness of the
Borrower that (a) does not have any scheduled principal payment, mandatory
principal prepayment or sinking fund payment due prior to the date that is six
months following the latest of the Incremental Term Maturity Date, Incremental
Delayed Draw Term Maturity Date and the Revolving Credit Termination Date;
(b) is not secured by any Lien on the Property of Borrower or any of its
Subsidiaries, and (c) is otherwise on terms (except for pricing) which are
(i) not, in the aggregate, more favorable to the holders of such Indebtedness
than those contained in the Existing Subordinated Obligations as in effect on
the date hereof in any manner which is detrimental to the Agents or the Lenders
or substantially identical thereto (in each case, as determined by the
Administrative Agent in its discretion) or (ii) otherwise approved by the
Lenders who will represent Required Lenders after giving effect to the
application of any proceeds of Permitted Refinancing Subordinated Obligations to
prepay Incremental Term Loans and Incremental Delayed Draw Term Loans (or if all
Incremental Term Loans and Incremental Delayed Draw Term Loans have been repaid,
to prepay Permitted Refinancing Subordinated Obligations and/or Permitted Senior
Unsecured Obligations), or Revolving Credit Loans.
“Permitted Senior Unsecured Notes”: the notes evidencing the Permitted Senior
Unsecured Obligations.
“Permitted Senior Unsecured Obligations” unsecured Indebtedness of the Borrower
in respect of debt securities (a) that does not have any scheduled principal
payment, mandatory principal prepayment, sinking fund payment or similar
provision (including the rights on the part of any holder to require the
redemption or repurchase of any such Indebtedness), in each case that could
require any payment of or on account of principal in respect thereof until the
date that is six months following the latest of the Incremental Term Maturity
Date, the Incremental Delayed Draw Term Maturity Date and the Revolving Credit
Termination Date (other than pursuant to change of control or asset sale
provisions customary for debt securities issued by issuers with credit ratings
comparable to that of the Borrower), (b) that is not secured by any Lien on the
Property of Borrower or any of its Subsidiaries, (c) that ranks pari passu with
the Loans and Commitments hereunder and does not constitute Subordinated
Obligations, and (d) is otherwise on terms (except for pricing) which are
(i) not, in the aggregate, more favorable to the holders of such Indebtedness
than those contained in the Existing Senior Unsecured Obligations as in effect
on the date hereof in any manner which is detrimental to the Agents or the
Lenders or substantially identical thereto (in each case, as determined by the
Administrative Agent in its discretion) or (ii) otherwise approved by the
Lenders who will represent Required Lenders after giving effect to the
application of any proceeds of Permitted Senior Unsecured Obligations to prepay
Incremental Term Loans and Incremental Delayed Draw Term Loans (or if all
Incremental Term Loans and Incremental Delayed Draw Term Loans have been repaid,
to prepay Permitted Refinancing Subordinated Obligations or Permitted Senior
Unsecured Obligations), or Revolving Credit Loans.

 

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“Person”: an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
“Plan”: at a particular time, any Single Employer Plan or employee benefit plan
other than a Multiemployer Plan that is subject to Section 412 or 430 of the
Code or Section 302 or 303 of ERISA and in respect of which the Borrower or a
Commonly Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA.
“Pledge Agreement (Gaming Regulated)”: the amended and restated pledge
agreements executed and delivered by the Borrower and the Restricted
Subsidiaries (other than Immaterial Subsidiaries) covering, subject to
exceptions set forth in such agreements, the Capital Stock owned by the Borrower
or any Restricted Subsidiary in any Subsidiary (other than Foreign Unrestricted
Subsidiaries) that conducts gambling, gaming or casino activities that are
subject to Gaming Laws as may be supplemented, modified, amended, extended or
supplanted from time to time.
“Pledge Agreement (General)”: the amended and restated pledge agreement executed
and delivered by the Borrower and the Restricted Subsidiaries (other than
Immaterial Subsidiaries) covering, subject to exceptions set forth in such
agreements, the Capital Stock held by the Borrower and any of such Subsidiaries
in all Subsidiaries of the Borrower, other than the Foreign Unrestricted
Subsidiaries or the Subsidiaries the Capital Stock of which is pledged pursuant
to a Pledge Agreement (Gaming Regulated) as may be supplemented, modified,
amended, extended or supplanted from time to time.
“Pledge Agreements”: collectively, the Pledge Agreements (Gaming Regulated) and
the Pledge Agreement (General).
“Pledged Stock”: Capital Stock pledged to the Administrative Agent for the
benefit of the Secured Parties, pursuant to the Pledge Agreements.
“Post-Closing Gaming Pledge Agreement Amendments”: the Pledge Agreements (Gaming
Regulated) listed on Schedule 1.1(c).
“PRC-MO Property”: the Admiral Riverboat Casino vessel, barge and associated
mooring points located on the Mississippi River near St. Louis, Missouri.
“Preferred Ship Mortgages”: collectively (a) each of the amended and restated
preferred ship mortgages made by any Loan Party in favor of the Administrative
Agent for the benefit of the Secured Parties, as described in Schedule 1.1(b),
and (b) any other preferred ship mortgages which are made by any Loan Party in
favor of the Administrative Agent from time to time in accordance with this
Agreement, which preferred ship mortgages shall be substantially in the form of
Exhibit D, as the same may be further supplemented, modified, amended, extended
or supplanted from time to time.

 

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“President Claims”: collectively, claims acquired in bankruptcy of President
Casinos, Inc. pending in the United States Bankruptcy Court, Eastern District of
Missouri, Eastern Division.
“Pro Forma Balance Sheet”: as defined in Section 4.1.
“Project”: the construction and/or renovation of any improvements on any
interest in any real property or any interest in any ship or barge owned by the
Borrower and/or any of its Restricted Subsidiaries, if the Expenses of such
construction and/or renovation could reasonably be expected to exceed
$75,000,000; provided that if the construction and/or renovation of any
improvements on any interest in any such real property or any interest in any
such ship or barge has been divided into separate phases for the construction
and/or renovation thereof, the each phase of such the construction and/or
renovation will be treated as a separate Project for all purposes under this
Agreement.
“Project Period”: for any Project, the period of time commencing on the date of
determination of the In-Balance Test with respect to such Project and ending on
the date six full months after the scheduled opening date for such Project;
“Project Sources”: as of any date of determination, an amount equal to the sum
of (a) the total unrestricted Cash and Cash Equivalents of the Borrower and its
Restricted Subsidiaries minus the Minimum Cash Requirement as of such date of
determination, plus (b) the amount of the Consolidated EBITDA of the Borrower
and its Restricted Subsidiaries set forth in the In-Balance Projections for the
In-Balance Test with respect to such Project, plus (c) unutilized Commitments
under the Revolving Credit Facility, any Incremental Revolving Facility or any
Incremental Delayed Draw Term Facility, in each case, as of such date of
determination, plus (d) unutilized committed lease financing or other form of
committed financing of the Borrower and its Restricted Subsidiaries as of such
date of determination for such Project (and for all other Unfinished Projects),
plus (e) the Net Disposition Proceeds to be received by the Borrower and its
Restricted Subsidiaries from Dispositions which are subject to contractual
commitments as of such date of determination, so long as (i) such contractual
commitments are not subject to any conditions other than the passage of time and
the obtaining of any applicable Gaming Board approvals, (ii) such Net
Disposition Proceeds are reasonably expected to be received during the Project
Period, (iii) the Borrower has designated or re-designated such Net Disposition
Proceeds for use for such Project or any other Unfinished Project, plus
(f) other sources of funds that other parties are contractually committed (such
as contractually committed proceeds of insurance payments and legal settlements
and awards) to make cash payments to the Borrower and its Restricted
Subsidiaries within the Project Period, so long as the Borrower has designated
or re-designated such cash payments for use for such Project or any other
Unfinished Project; provided however, that the combined amount added pursuant to
clause (e) and clause (f) shall not exceed $25,000,000 in the aggregate.
“Project Uses”: as of any date of determination, an amount equal to the sum of
(a) the forecasted cash interest costs of the Borrower and its Restricted
Subsidiaries from such date of determination through the end of the Project
Period for such Project, plus (b) projected Maintenance Capital Expenditures and
all other Capital Expenditures of the Borrower and its Restricted Subsidiaries
(other than Capital Expenditures for such Project and all other Unfinished

 

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Projects) through the Project Period for such Project, plus (c) all remaining
Expenses for such Project and all other Unfinished Projects (including any
pre-opening costs) through the Project Period for such Project, plus
(d) forecasted cash income tax payments of the Borrower and its Restricted
Subsidiaries through the Project Period for such Project, plus (e) Investments
with respect to which the Borrower and/or any of its Restricted Subsidiaries has
entered into a written enforceable agreement or contract to make at any time
during the Project Period for such Project.
“Projections”: as defined in Section 6.2(c).
“Property”: any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible, including,
without limitation, Capital Stock.
“Qualified Counterparty”: with respect to any Specified Hedge Agreement, any
counterparty thereto that, at the time such Specified Hedge Agreement was
entered into, was a Lender or an affiliate of a Lender.
“Rabbi Trust”: that certain Grantor Trust Agreement made the 1st day of January,
2000 by and between the Borrower and Wachovia Bank, N.A., as trustee (or any
successor trustee), as amended, modified and supplemented from time to time in
accordance with this Agreement.
“Reclassified Foreign Subsidiary Receipts”: as of any date of determination, the
aggregate amount of Foreign Subsidiary Receipts received by the Borrower or any
Restricted Subsidiary after the Effective Date and through the date of
determination (a) which have not been invested in any Foreign Unrestricted
Subsidiary in accordance with the provisions of Section 7.7(j); and (b) with
respect to which the Borrower has provided the Administrative Agent an
irrevocable written notice prior to such date of determination that Foreign
Subsidiary Receipts in such amount is not available for investment in any
Foreign Unrestricted Subsidiary.
“Recovery Event”: any payment in excess of $2,500,000 in respect of any property
or casualty insurance claim or any condemnation proceeding relating to any asset
of the Borrower or any of its Restricted Subsidiaries.
“Redevelopment Agreement”: that certain Redevelopment Agreement dated as of
April 22, 2004 by and between the Land Clearance for Redevelopment Authority of
the City of St. Louis and the Borrower, as may be amended, extended, renewed,
supplemented, restated, amended and restated or otherwise modified from time to
time.
“Refunded Swing Line Loans”: as defined in Section 2.7(b).
“Refunding Date”: as defined in Section 2.7(c).
“Register”: as defined in Section 10.6(d).
“Regulation H”: Regulation H of the Board as in effect from time to time.
“Regulation U”: Regulation U of the Board as in effect from time to time.

 

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“Reimbursement Obligation”: the obligation of the Borrower to reimburse each
Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit
issued by such Issuing Lender.
“Reinvestment Deferred Amount”: with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by the Borrower or any of its Restricted
Subsidiaries in connection therewith that are not applied to prepay the
Incremental Term Loans or the Incremental Delayed Draw Term Loans or to reduce
the Revolving Credit Commitments pursuant to Section 2.13(b) or Section 2.13(c),
as applicable, as a result of the delivery of a Reinvestment Notice.
“Reinvestment Event”: any Asset Sale or Recovery Event in respect of which the
Borrower has delivered a Reinvestment Notice.
“Reinvestment Notice”: a written notice executed by a Responsible Officer and
delivered to the Administrative Agent within ten (10) Business Days after an
Asset Sale or Recovery Event stating that no Default or Event of Default has
occurred and is continuing and that the Borrower (directly or indirectly through
a Restricted Subsidiary) intends and expects to use all or a specified portion
of the Net Cash Proceeds of an Asset Sale or Recovery Event to acquire assets
useful in the business of the Borrower or the applicable Restricted Subsidiary.
“Reinvestment Prepayment Date”: with respect to any Reinvestment Event, the
earlier of (a) the date occurring fifteen (15) months after such Reinvestment
Event and (b) the date on which the Borrower shall have determined not to, or
shall have otherwise ceased to, acquire assets permitted under this Agreement
with all or any portion of the relevant Reinvestment Deferred Amount.
“Related Fund”: with respect to any Lender, any fund that (x) invests in
commercial loans and (y) is managed or advised by the same investment advisor
(or an Affiliate of such investment adviser) as such Lender, by such Lender or
an Affiliate of such Lender.
“Reno Property”: the Boomtown Hotel and Casino located in Reno, Nevada.
“Reorganization”: with respect to any Multiemployer Plan, the condition that
such plan is in reorganization within the meaning of Section 4241 of ERISA.
“Reportable Event”: any of the events set forth in Section 4043(c) of ERISA,
other than those events as to which the thirty day notice period is waived under
subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.
“Required Lenders”: at any time, the holders of more than 50% of the sum of
(a) the aggregate unpaid amount of the Incremental Term Loans then outstanding,
(b) the aggregate unpaid amount of the Incremental Delayed Draw Term Loans then
outstanding, (c) the unfunded Incremental Delayed Draw Term Commitments (if
any), and (d) the Total Revolving Credit Commitments then in effect or, if the
Revolving Credit Commitments have been terminated, the Total Revolving
Extensions of Credit then outstanding; provided that the Incremental Term Loans,
the Incremental Delayed Draw Term Loans and that portion of the Total Revolving
Extensions of Credit held or deemed held by, and the Commitments of, any

 

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Defaulting Lender shall be excluded for purposes of making a determination of
Required Lenders.
“Required Prepayment Lenders”: the Majority Facility Lenders in respect of each
Facility.
“Requirement of Law”: as to any Person, the Certificate of Incorporation and
By-Laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of an arbitrator or 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.
“Responsible Officer”: the chief executive officer, president or chief financial
officer of the Borrower, but in any event, with respect to financial matters,
the chief financial officer of the Borrower; provided that the treasurer of the
Borrower may act as a Responsible Officer with respect to any Borrowing Notices
to be delivered under this Agreement.
“Restricted Payments”: as defined in Section 7.6.
“Restricted Subsidiaries”: as of the date of determination, all Subsidiaries of
the Borrower other than Subsidiaries of the Borrower which have been properly
designated as Unrestricted Subsidiaries of the Borrower in accordance with the
definition thereof. The Borrower may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary in writing to Administrative Agent,
provided that no Default or Event of Default would be in existence following
such designation.
“Revolving Credit Commitment”: as to any Lender, the obligation of such Lender,
if any, to make Revolving Credit Loans and participate in Swing Line Loans and
Letters of Credit, in an aggregate principal and/or face amount not to exceed
the amount set forth under the heading “Revolving Credit Commitment” opposite
such Lender’s name on Schedule 1 to the Lender Addendum delivered by such
Lender, or, as the case may be, in the Assignment and Acceptance pursuant to
which such Lender became a party hereto, as the same may be changed from time to
time pursuant to the terms hereof. The original aggregate amount of the Total
Revolving Credit Commitments is $375,000,000.
“Revolving Credit Commitment Period”: the period from and including the
Effective Date to the Revolving Credit Termination Date.
“Revolving Credit Facility”: the revolving credit facility described in Section
2.4.
“Revolving Credit Lender”: each Lender (including Incremental Revolving Credit
Lenders) that has a Revolving Credit Commitment or that is the holder of
Revolving Credit Loans.
“Revolving Credit Loans”: as defined in Section 2.4.
“Revolving Credit Note”: as defined in Section 2.9(e).

 

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“Revolving Credit Percentage”: as to any Revolving Credit Lender at any time,
the percentage which such Lender’s Revolving Credit Commitment then constitutes
of the Total Revolving Credit Commitments (or, at any time after the Revolving
Credit Commitments shall have expired or terminated, the percentage which the
aggregate amount of such Lender’s Revolving Extensions of Credit then
outstanding constitutes of the amount of the Total Revolving Extensions of
Credit then outstanding).
“Revolving Credit Termination Date”: March 31, 2014; provided that such date
shall be accelerated to September 30, 2011 if any portion of the Borrower’s
8.25% Senior Subordinated Notes due March 15, 2012 are outstanding on
September 30, 2011 (or such earlier date on which the Loans become due and
payable pursuant to Section 8).
“Revolving Extensions of Credit”: as to any Revolving Credit Lender at any time,
an amount equal to the sum of (a) the aggregate principal amount of all
Revolving Credit Loans made by such Lender then outstanding, (b) such Lender’s
Revolving Credit Percentage of the L/C Obligations then outstanding and (c) such
Lender’s Revolving Credit Percentage of the aggregate principal amount of Swing
Line Loans then outstanding.
“River City Property”: the River City complex and casino located in south St.
Louis County, Missouri.
“S&P”: Standard & Poor’s Ratings Services.
“SEC”: the Securities and Exchange Commission (or successors thereto or an
analogous Governmental Authority).
“Secured Parties”: as defined in the Security Agreement.
“Security Agreement”: the Second Amended and Restated Security Agreement
executed and delivered by the Borrower and the Restricted Subsidiaries (other
than Immaterial Subsidiaries) on December 14, 2005, as has been amended and
supplemented through the Effective Date and as may be further supplemented,
modified, amended, extended or supplanted from time to time in accordance with
the terms of this Agreement.
“Security Documents”: the collective reference to the Security Agreement, the
Trademark Collateral Assignment, the Pledge Agreements (Gaming Regulated), the
Pledge Agreement (General), the Mortgages, the Preferred Ship Mortgages, and any
other security agreement, pledge agreement, deed of trust, mortgage, and all
other security documents hereafter delivered to the Administrative Agent, as
each may have been amended, restated, supplemented, or otherwise modified from
time to time, granting a Lien on any Property of any Person to secure the
obligations and liabilities of any Loan Party under any Loan Document.
“Senior Subordinated Indentures”: the Senior Subordinated Notes Indenture 2004,
and the Senior Subordinated Notes Indenture 2007 and any future indentures or
other agreements governing any New Subordinated Obligations or any Permitted
Refinancing Subordinated Obligations.

 

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“Senior Subordinated Notes Indenture 2004”: Indenture dated as of March 15, 2004
among the Borrower, the initial guarantors referred to therein, and The Bank of
New York Mellon Trust Company, N.A., as Trustee, as supplemented by the First
Supplemental Indenture dated as of December 3, 2004, and as further amended from
time to time, pursuant to which certain of the Existing Subordinated Obligations
were issued.
“Senior Subordinated Notes Indenture 2007”: Indenture dated as of June 8, 2007
among the Borrower, the initial guarantors referred to therein, and The Bank of
New York Mellon Trust Company, N.A., as Trustee, as amended from time to time,
pursuant to which certain of the Existing Subordinated Obligations were issued.
“Senior Unsecured Indentures”: the Senior Unsecured Notes Indenture 2009 and any
future indentures or other agreements governing any Permitted Senior Unsecured
Obligations.
“Senior Unsecured Notes”: the notes evidencing the Existing Senior Unsecured
Obligations or the Permitted Senior Unsecured Obligations.
“Senior Unsecured Notes Indenture 2009”: Indenture dated as of August 10, 2009
among the Borrower, the initial guarantors referred to therein, and The Bank of
New York Mellon Trust Company, N.A., as Trustee, as amended from time to time,
pursuant to which certain of the Existing Subordinated Obligations were issued.
“Single Employer Plan”: any Plan that is covered by Title IV of ERISA, but which
is not a Multiemployer Plan.
“Solvent”: with respect to any Person, as of any date of determination, (a) the
amount of the “present fair saleable value” of the assets of such Person will,
as of such date, exceed the amount of all “liabilities of such Person,
contingent or otherwise”, as of such date, as such quoted terms are determined
in accordance with applicable federal and state laws governing determinations of
the insolvency of debtors, (b) the present fair saleable value of the assets of
such Person will, as of such date, be greater than the amount that will be
required to pay the liability of such Person on its debts as such debts become
absolute and matured, (c) such Person will not have, as of such date, an
unreasonably small amount of capital with which to conduct its business, and
(d) such Person will be able to pay its debts as they mature. For purposes of
this definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means
any (x) right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured or (y) right to an equitable
remedy for breach of performance if such breach gives rise to a right to
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured.
“Specified Change of Control”: a “Change of Control”, or like event, as defined
in any of the Indentures or other document entered into by the Borrower or any
Restricted Subsidiary with respect to any New Subordinated Obligations,
Permitted Refinancing Subordinated Obligations or Permitted Senior Unsecured
Obligations.

 

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“Specified Hedge Agreement”: any Hedge Agreement entered into by the Borrower or
any Subsidiary Guarantor and any Qualified Counterparty.
“STAR and TIF Bonds”: collectively, tax based bonds and tax increment financing
bonds issued by a governmental authority to finance the development of the
properties subject to the Cabela’s Transaction.
“Stated Amount”: at any time, the maximum amount available to be drawn under a
Letter of Credit (in each case determined without regard to whether any
conditions to drawing could then be met).
“St. Louis County Ground Lease”: that certain Lease and Development Agreement,
dated as of August 12, 2004, by and between the Borrower and the St. Louis
County Port Authority, as it may be amended, amended and restated or otherwise
modified from time to time, for an approximate 56 acre tract of land, together
with the improvements thereon covered by such ground lease, located in the Lemay
area of St. Louis County, Missouri.
“Subordinated Notes”: the notes evidencing the Existing Subordinated Obligations
or the New Subordinated Obligations.
“Subordinated Obligations”: collectively, the Existing Subordinated Obligations
and the New Subordinated Obligations.
“Subsidiary”: as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such corporation,
partnership or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries,
or both, by such Person. Unless otherwise qualified, all references to a
“Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Borrower.
“Subsidiary Guarantor”: each direct and indirect Domestic Subsidiary of the
Borrower and, to the extent that it would not result in an adverse tax, foreign
gaming, or foreign law consequence that is material for or with respect to such
Subsidiary, Foreign Subsidiary of the Borrower (in each case, other than the
Immaterial Subsidiaries and the Unrestricted Subsidiaries), that has executed a
Subsidiary Guaranty or a joinder thereto.
“Subsidiary Guaranty”: the Second Amended and Restated Subsidiary Guaranty
executed and delivered by the Restricted Subsidiaries (other than Immaterial
Subsidiaries) parties thereto on December 14, 2005, as has been amended and
supplemented through the Effective Date and as may be further supplemented,
modified, amended, extended or supplanted from time to time in accordance with
the terms of this Agreement.
“Sugarcane Bay Lease”: the lease with respect to a portion of the Sugarcane Bay
Property.

 

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“Sugarcane Bay Property”: the Sugarcane Bay casino resort complex and dockside
casino located in Lake Charles, Louisiana.
“Supermajority Lenders”: at any time, the holders of more than 66.7% of the sum
of (a) the aggregate unpaid amount of the Incremental Term Loans then
outstanding, (b) the aggregate unpaid amount of the Incremental Delayed Draw
Term Loans then outstanding, (c) the unfunded Incremental Delayed Draw Term
Commitments (if any), and (d) the Total Revolving Credit Commitments then in
effect or, if the Revolving Credit Commitments have been terminated, the Total
Revolving Extensions of Credit then outstanding; provided that the Incremental
Term Loans, the Incremental Delayed Draw Term Loans and that portion of the
Total Revolving Extensions of Credit held or deemed held by, and the Commitments
of, any Defaulting Lender shall be excluded for purposes of making a
determination of Supermajority Lenders.
“Swing Line Back-Stop Arrangements”: as defined in Section 2.7.
“Swing Line Commitment”: the obligation of the Swing Line Lender to make Swing
Line Loans pursuant to Section 2.6 in an aggregate principal amount at any one
time outstanding not to exceed $25,000,000.
“Swing Line Lender”: any Revolving Credit Lender from time to time designated by
the Borrower as the Swing Line Lender with the consent of such Revolving Credit
Lender and notice to the Administrative Agent; provided that in no event shall
(a) there be more than one Swing Line Lender at any time and (b) any change in
the Swing Line Lender be permitted to occur while any Swing Line Loans are
outstanding. As of the Effective Date, there is no Swing Line Lender.
“Swing Line Loans”: as defined in Section 2.6.
“Swing Line Note”: as defined in Section 2.9(e).
“Swing Line Participation Amount”: as defined in Section 2.7(c).
“Syndication Agents”: as defined in the preamble hereto.
“Total Revolving Credit Commitments”: at any time, the aggregate amount of the
Revolving Credit Commitments then in effect.
“Total Revolving Extensions of Credit”: at any time, the aggregate amount of the
Revolving Extensions of Credit of the Revolving Credit Lenders outstanding at
such time.
“Trademark Collateral Assignment”: the Second Amended and Restated Trademark
Collateral Assignment executed and delivered by the Borrower and the Restricted
Subsidiaries dated as of December 14, 2005, as amended by that certain First
Amendment to Amended and Restated Trademark Collateral Assignment dated as of
August 10, 2009, and as further amended by that certain Second Amendment to
Amended and Restated Trademark Collateral Assignment dated October 1, 2009, and
as further amended by that certain Third Amendment to Amended and Restated
Trademark Collateral Assignment dated December 8,

 

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2009 and as may be further supplemented, modified, amended, extended or
supplanted from time to time.
“Transferee”: as defined in Section 10.14.
“Type”: as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.
“UCC”: the Uniform Commercial Code under New York law except to the extent the
law of any local jurisdiction applies.
“Undeveloped Reno Property”: approximately 500 acres of undeveloped land
adjacent to the Boomtown Hotel and Casino in Reno, Nevada owned by the Borrower
and/or any of its Restricted Subsidiaries as of the Effective Date, other than
the land and real property constituting the Cabela’s Transaction Property.
“Unfinished Projects”: as of any date, any Project (a) with respect to which the
Commencement of Construction has occurred prior to such date and (b) the
Completion of Construction has not occurred; provided that the parties
acknowledge and agree that Commencement of Construction has occurred for the
River City Property Project prior to the Effective Date.
“Unrestricted Subsidiaries”: the Foreign Subsidiaries and the Domestic
Subsidiaries designated on the Effective Date as Unrestricted Subsidiaries on
Schedule 4.15(a) and any other Subsidiary of the Borrower formed or acquired
after the Effective Date and designated as “Unrestricted” by the Borrower to
Administrative Agent in writing, provided, however, that (a) no Subsidiary may
be designated as an Unrestricted Subsidiary at any time when a Default or Event
of Default has occurred and remains continuing, or would result from such
designation, (b) the Borrower shall make any such designation prior to or
substantially concurrently with the acquisition or formation of the relevant
Subsidiary; provided, however, that any Immaterial Subsidiary may be
re-designated as “Unrestricted” at any time before such Subsidiary ceases to be
an Immaterial Subsidiary.
“Wholly Owned Subsidiary”: as to any Person, any other Person all of the Capital
Stock of which (other than directors’ qualifying shares required by law) is
owned by such Person directly and/or through other Wholly Owned Subsidiaries.
“Wholly Owned Subsidiary Guarantor”: any Subsidiary Guarantor that is a Wholly
Owned Subsidiary of the Borrower.
1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in this Agreement
shall have the defined meanings when used in the other Loan Documents or any
certificate or other document made or delivered pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms relating
to the Borrower and its Subsidiaries not defined in Section 1.1 and accounting
terms partly defined in

 

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Section 1.1, to the extent not defined, shall have the respective meanings given
to them under GAAP.
(c) The words “hereof”, “herein” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Section, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally applicable to
both the singular and plural forms of such terms.
(e) All calculations of financial ratios set forth in Section 7.1 and the
calculation of the Consolidated Total Leverage Ratio for purposes of determining
the Applicable Margin shall be calculated to the same number of decimal places
as the relevant ratios are expressed in and shall be rounded upward if the
number in the decimal place immediately following the last calculated decimal
place is five or greater. For example, if the relevant ratio is to be calculated
to the hundredth decimal place and the calculation of the ratio is 5.126, the
ratio will be rounded up to 5.13.
SECTION 2.
AMOUNT AND TERMS OF COMMITMENTS
2.1 Incremental Term Loans and Incremental Delayed Draw Term Loans.
(a) The Incremental Term Loans, if any, shall be made by the Incremental Term
Lenders in a single drawing on the date set forth in the Incremental Facility
Activation Notice with respect to the applicable Incremental Term Facility. The
Incremental Term Loans may from time to time be Eurodollar Loans or Base Rate
Loans, as determined by the Borrower and notified to the Administrative Agent in
accordance with Section 2.2 and Section 2.14; provided that no Incremental Term
Loan shall be made as a Eurodollar Loan after the day that is one month prior to
the Incremental Term Maturity Date for such Incremental Term Loan.
(b) Each Incremental Delayed Draw Term Lender, if any, severally agrees to make
term loans to the Borrower in the manner and subject to the terms and conditions
set forth in the Incremental Facility Activation Notice with respect to the
applicable Incremental Delayed Draw Term Facility. The Incremental Delayed Draw
Term Loans may from time to time be Eurodollar Loans or Base Rate Loans, as
determined by the Borrower and notified to the Administrative Agent in
accordance with Section 2.2 and Section 2.14; provided that no Incremental Term
Loan shall be made as a Eurodollar Loan after the day that is one month prior to
the Incremental Delayed Draw Term Maturity Date for such Incremental Delayed
Draw Term Loan.

 

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2.2 Procedure for Incremental Term Loan and Incremental Delayed Draw Term Loan
Borrowing.
(a) The Borrower shall deliver to the Administrative Agent a Borrowing Notice
(which Borrowing Notice must be received by the Administrative Agent prior to
12:00 Noon, New York City time, (a) three Business Days prior to the requested
Borrowing Date, in the case of Eurodollar Loans, or (b) one Business Day prior
to the requested Borrowing Date, in the case of Base Rate Loans) requesting that
the Incremental Term Lenders make the requested Incremental Term Loans. Upon
receipt of such Borrowing Notice the Administrative Agent shall promptly notify
each Incremental Term Lender thereof. Not later than 12:00 Noon, New York City
time, on the Borrowing Date, each Incremental Term Lender shall make available
to the Administrative Agent at the Funding Office an amount in immediately
available funds equal to the Incremental Term Loan to be made by such
Incremental Term Lender.
(b) The Borrower shall deliver to the Administrative Agent a Borrowing Notice
(which Borrowing Notice must be received by the Administrative Agent prior to
12:00 Noon, New York City time, (a) three Business Days prior to the requested
Borrowing Date, in the case of Eurodollar Loans, or (b) one Business Day prior
to the requested Borrowing Date, in the case of Base Rate Loans) requesting that
the Incremental Delayed Draw Term Lenders make the requested Incremental Delayed
Draw Term Loans. Upon receipt of such Borrowing Notice the Administrative Agent
shall promptly notify each Incremental Delayed Draw Term Lender thereof. Not
later than 12:00 Noon, New York City time, on the Borrowing Date, each
Incremental Delayed Draw Term Lender shall make available to the Administrative
Agent at the Funding Office an amount in immediately available funds equal to
the Incremental Delayed Draw Term Loan to be made by such Incremental Delayed
Draw Term Lender.
(c) The Administrative Agent shall make available to the Borrower the aggregate
of the amounts made available to the Administrative Agent by the Lenders under
clause (a) or (b) of this Section 2.2, in like funds as received by the
Administrative Agent. Any Incremental Term Loans and Incremental Delayed Draw
Term Loans made on each Incremental Facility Effective Date shall initially be
Base Rate Loans.
2.3 Repayment of Incremental Term Loans and Incremental Delayed Draw Term Loans.
(a) Each Incremental Term Loan shall be payable in accordance with the
Incremental Facility Activation Notice with respect to the applicable
Incremental Term Facility.
(b) Each Incremental Delayed Draw Term Loan shall be payable in accordance with
the Incremental Facility Activation Notice with respect to the applicable
Incremental Delayed Draw Term Facility.
2.4 Revolving Credit Commitments. Subject to the terms and conditions hereof,
each Revolving Credit Lender severally agrees to make revolving credit loans
(“Revolving Credit Loans”) to the Borrower from time to time during the
Revolving Credit Commitment Period in an aggregate principal amount at any one
time outstanding for such Revolving Credit Lender which, when added to such
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the sum of (i) the L/C Obligations then outstanding (exclusive of Payment
Amounts which are repaid with the proceeds of, and simultaneously with, the
incurrence of, the respective incurrence of Revolving Credit Loans) and (ii) the
aggregate principal amount of the Swing Line Loans then outstanding (exclusive
of Swing Line Loans which are repaid with the proceeds of, and simultaneously
with the incurrence of, the respective incurrence of Revolving Credit Loans),
does not exceed the amount of such Lender’s Revolving Credit Commitment. During
the Revolving Credit Commitment Period the Borrower may use the Revolving Credit
Commitments by borrowing, prepaying the Revolving Credit Loans in whole or in
part, and reborrowing, all in accordance with the terms and conditions hereof.
The Revolving Credit Loans may from time to time be Eurodollar Loans or Base
Rate Loans, as determined by the Borrower and notified to the Administrative
Agent in accordance with Section 2.5 and Section 2.14, provided that no
Revolving Credit Loan shall be made as a Eurodollar Loan after the day that is
one month prior to the Revolving Credit Termination Date. The Borrower shall
repay all outstanding Revolving Credit Loans on the Revolving Credit Termination
Date. Each borrowing by the Borrower hereunder of Revolving Credit Loans shall
be made pro rata according to the Revolving Credit Percentages of the Revolving
Credit Lenders.
2.5 Procedure for Revolving Credit Borrowing. The Borrower may borrow under the
Revolving Credit Commitments on any Business Day during the Revolving Credit
Commitment Period, provided that the Borrower shall deliver to the
Administrative Agent a Borrowing Notice (which Borrowing Notice must be received
by the Administrative Agent prior to 12:00 Noon, New York City time, (a) three
Business Days prior to the requested Borrowing Date, in the case of Eurodollar
Loans, or (b) one Business Day prior to the requested Borrowing Date, in the
case of Base Rate Loans). Any Revolving Credit Loans made on the Effective Date
shall initially be Base Rate Loans. Each borrowing of Revolving Credit Loans
under the Revolving Credit Commitments shall be in an amount equal to (x) in the
case of Base Rate Loans, $1,000,000 or a whole multiple thereof (or, if the then
aggregate Available Revolving Credit Commitments are less than $1,000,000, such
lesser amount) and (y) in the case of Eurodollar Loans, $1,000,000 or a whole
multiple of $1,000,000 in excess thereof; provided, that the Swing Line Lender
may request, on behalf of the Borrower, borrowings of Base Rate Loans under the
Revolving Credit Commitments in other amounts pursuant to Section 2.7. Upon
receipt of any such Borrowing Notice from the Borrower, the Administrative Agent
shall promptly notify each Revolving Credit Lender thereof. Each Revolving
Credit Lender will make its Revolving Credit Percentage of the amount of each
borrowing of Revolving Credit Loans available to the Administrative Agent for
the account of the Borrower at the Funding Office prior to 12:00 Noon, New York
City time, on the Borrowing Date requested by the Borrower in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Borrower by the Administrative Agent in like funds as received
by the Administrative Agent.
2.6 Swing Line Commitment. Subject to the terms and conditions hereof, the Swing
Line Lender agrees that, during the Revolving Credit Commitment Period, it will
make available to the Borrower in the form of swing line loans (“Swing Line
Loans”) a portion of the credit otherwise available to the Borrower under the
Revolving Credit Commitments; provided that (i) the aggregate principal amount
of Swing Line Loans outstanding at any time shall not exceed the Swing Line
Commitment then in effect (notwithstanding that the Swing Line Loans outstanding
at any time, when aggregated with the Swing Line Lender’s other outstanding

 

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Revolving Credit Loans hereunder, may exceed the Swing Line Commitment then in
effect or such Swing Line Lender’s Revolving Credit Commitment then in effect)
and (ii) the Borrower shall not request, and the Swing Line Lender shall not
make, any Swing Line Loan if, after giving effect to the making of such Swing
Line Loan, the aggregate amount of the Available Revolving Credit Commitments
would be less than zero. During the Revolving Credit Commitment Period, the
Borrower may use the Swing Line Commitment by borrowing, repaying and
reborrowing, all in accordance with the terms and conditions hereof. Swing Line
Loans shall be Base Rate Loans only. The Borrower shall repay all outstanding
Swing Line Loans on the Revolving Credit Termination Date.
2.7 Procedure for Swing Line Borrowing; Refunding of Swing Line Loans.
(a) Subject to the terms and conditions hereof, the Borrower may borrow under
the Swing Line Commitment on any Business Day during the Revolving Credit
Commitment Period, provided, the Borrower shall give the Swing Line Lender
irrevocable telephonic notice confirmed promptly in writing (which telephonic
notice must be received by the Swing Line Lender not later than 1:00 P.M., New
York City time, on the proposed Borrowing Date), specifying (i) the amount to be
borrowed and (ii) the requested Borrowing Date. Each borrowing under the Swing
Line Commitment shall be in an amount equal to $500,000 or a whole multiple of
$100,000 in excess thereof. Not later than 3:00 P.M., New York City time, on the
Borrowing Date specified in the borrowing notice in respect of any Swing Line
Loan, the Swing Line Lender shall make available to the Administrative Agent at
the Funding Office an amount in immediately available funds equal to the amount
of such Swing Line Loan. The Administrative Agent shall make the proceeds of
such Swing Line Loan available to the Borrower on such Borrowing Date in like
funds as received by the Administrative Agent.
(b) The Swing Line Lender, at any time and from time to time in its sole and
absolute discretion may, on behalf of the Borrower (which hereby irrevocably
directs the Swing Line Lender to act on its behalf), on one Business Day’s
notice given by the Swing Line Lender to the Administrative Agent no later than
12:00 Noon, New York City time, request each Revolving Credit Lender to make,
and each Revolving Credit Lender hereby agrees to make, a Revolving Credit Loan
(which shall initially be a Base Rate Loan), in an amount equal to such
Revolving Credit Lender’s Revolving Credit Percentage of the aggregate amount of
the Swing Line Loans (the “Refunded Swing Line Loans”) outstanding on the date
of such notice, to repay the Swing Line Lender. Each Revolving Credit Lender
shall make the amount of such Revolving Credit Loan available to the
Administrative Agent at the Funding Office in immediately available funds, not
later than 10:00 A.M., New York City time, one Business Day after the date of
such notice. The proceeds of such Revolving Credit Loans shall be made
immediately available by the Administrative Agent to the Swing Line Lender for
application by the Swing Line Lender to the repayment of the Refunded Swing Line
Loans.
(c) If prior to the time a Revolving Credit Loan would have otherwise been made
pursuant to Section 2.7(b), one of the events described in Section 8(f) shall
have occurred and be continuing with respect to the Borrower, or if for any
other reason, as determined by the Swing Line Lender in its sole discretion,
Revolving Credit Loans may not be made as contemplated by Section 2.7(b), each
Revolving Credit Lender shall, on the date such Revolving

 

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Credit Loan was to have been made pursuant to the notice referred to in
Section 2.7(b) (the “Refunding Date”), purchase for Cash an undivided
participating interest in the then outstanding Swing Line Loans by paying to the
Swing Line Lender an amount (the “Swing Line Participation Amount”) equal to
(i) such Revolving Credit Lender’s Revolving Credit Percentage times (ii) the
sum of the aggregate principal amount of Swing Line Loans then outstanding which
were to have been repaid with such Revolving Credit Loans.
(d) Whenever, at any time after the Swing Line Lender has received from any
Revolving Credit Lender such Revolving Credit Lender’s Swing Line Participation
Amount, the Swing Line Lender receives any payment on account of the Swing Line
Loans, the Swing Line Lender will distribute to such Revolving Credit Lender its
Swing Line Participation Amount (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such Lender’s participating
interest was outstanding and funded and, in the case of principal and interest
payments, to reflect such Lender’s pro rata portion of such payment if such
payment is not sufficient to pay the principal of and interest on all Swing Line
Loans then due); provided, however, that in the event that such payment received
by the Swing Line Lender is required to be returned, such Revolving Credit
Lender will return to the Swing Line Lender any portion thereof previously
distributed to it by the Swing Line Lender. If any amount required to be paid by
any Revolving Credit Lender to the Administrative Agent, for the account of the
Swing Line Lender, pursuant to Section 2.7(b) or Section 2.7(c) in respect of
any Swing Line Loan is not paid to the Swing Line Lender within three Business
Days after the date such payment is due, the Swing Line Lender shall so notify
the Administrative Agent, who shall notify such Revolving Credit Lender and such
Revolving Credit Lender shall pay to the Administrative Agent, for the account
of the Swing Line Lender on demand (and thereafter the Administrative Agent
shall promptly pay to the Swing Line Lender) an amount equal to the product of
(i) such amount, times (ii) the daily average Federal Funds Effective Rate
during the period from and including the date such payment is required to the
date on which such payment is immediately available to the Swing Line Lender,
times (iii) a fraction the numerator of which is the number of days that elapse
during such period and the denominator of which is 360. If any such amount
required to be paid by the Swing Line pursuant to Section 2.7(b) or
Section 2.7(c) is not made available to the Administrative Agent, for the
account of the Swing Line Lender, by such Revolving Credit Lender within three
Business Days after the date such payment is due, the Administrative Agent on
behalf of the Swing Line Lender shall be entitled to recover from such Revolving
Credit Lender, on demand, such amount with interest thereon calculated from such
due date at the rate per annum applicable to Base Rate Loans under the Revolving
Credit Facility.
(e) Each Revolving Credit Lender’s obligation to make the Loans referred to in
Section 2.7(b) and to purchase participating interests pursuant to
Section 2.7(c) shall be absolute and unconditional and shall not be affected by
any circumstance, including, without limitation, (i) any setoff, counterclaim,
recoupment, defense or other right which such Revolving Credit Lender or the
Borrower may have against the Swing Line Lender, the Borrower or any other
Person for any reason whatsoever; (ii) the occurrence or continuance of a
Default or an Event of Default or the failure to satisfy any of the other
conditions specified in Section 5; (iii) any adverse change in the condition
(financial or otherwise) of the Borrower; (iv) any breach of this Agreement or
any other Loan Document by the Borrower, any other Loan Party or any other

 

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Revolving Credit Lender; or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
(f) The Swing Line Lender shall not be obligated to make any Swing Line Loans if
(i) any Revolving Credit Lender is at such time a Defaulting Lender or (ii) if
the Swing Line Lender, in its reasonable discretion, determines that there may
be a risk of any Revolving Credit Lender becoming a Defaulting Lender, unless,
in either case, the Swing Line Lender has entered into arrangements satisfactory
to the Swing Line Lender to eliminate the Swing Line Lender’s actual or
potential Fronting Exposure with respect to such Revolving Credit Lender,
including by cash collateralizing such Revolving Credit Lender’s Revolving
Credit Percentage of the outstanding Swing Line Loans (such arrangements, the
“Swing Line Back-Stop Arrangements”).
2.8 Incremental Loans.
(a) Borrower may at any time, by notice to Administrative Agent, request that,
subject to the following conditions and otherwise in accordance with this
Agreement, Lenders and/or New Lenders provide (w) one or more term loan
facilities (the “Incremental Term Facilities”), (x) one or more delayed draw
term loan facilities (the “Incremental Delayed Draw Term Facilities”),
(y) additional Revolving Credit Commitments (the “Incremental Revolving Credit
Commitments”) and/or (z) one or more additional revolving credit facilities (the
“Incremental Revolving Facilities” and, together with the Incremental Term
Facilities, the Incremental Delayed Draw Term Facilities and the Incremental
Revolving Credit Commitments, collectively, the “Incremental Facilities” and
individually an “Incremental Facility”); provided, that on the date that any
such Incremental becomes effective (the “Incremental Facility Effective Date”):
(i) no Default or Event of Default shall have occurred and be continuing or
result from such Incremental Facility and/or the Incremental Loans made pursuant
to such Incremental Facility; (ii) after giving effect to all Incremental Loans
made under such Incremental Facility of the applicable Incremental Facility
Effective Date, the Borrower will be in compliance on a pro forma basis with the
provisions of Section 7.1(a) and Section 7.1(b) (determined as of the last day
of the most recent fiscal quarter for which financial statements are required to
be delivered under Section 6.1(a) or Section 6.1(b) as if such Incremental Loans
had been funded and the application of such proceeds had occurred on such last
day); (iii) the terms of such Incremental Facility and the applicable
Incremental Loans are in compliance with Section 2.8(c) below; (iv) the Borrower
shall have received all approvals from all applicable Governmental Authorities
necessary or, in the discretion of the Administrative Agent, advisable in
connection with such Incremental Facility; (v) the Borrower shall have delivered
to the Administrative Agent a legal opinion of each such special or local
counsel as may be reasonably requested by the Administrative Agent with respect
to such Incremental Facility and the applicable Incremental Facility Amendments;
(vi) the Borrower shall have delivered to the Administrative Agent title and
extended coverage insurance for each real property Collateral covering the
amount of such Incremental Facility containing such endorsements and affirmative
coverage as the Administrative Agent may reasonably request; (vii) the
Administrative Agent and the Borrower shall execute conforming amendments to
this Agreement and the other Loan Documents (collectively, the “Incremental
Facility Amendments”) to reflect such Incremental Facility without the consent
of any Lender, including, without limitation, to provide for the terms set forth
in the Incremental Facility Activation Notice described below or Section 2.8(c),
and

 

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(viii) the Incremental Facility Effective Date shall not occur prior to five
(5) Business Days (or such shorter period as shall be agreed by the
Administrative Agent) after the date which the Administrative Agent receives the
Incremental Facility Activation Notice.
(b) Upon receipt of such notice and an officer’s certificate as to the
satisfaction of the foregoing conditions, the Administrative Agent shall use all
commercially reasonable efforts to arrange for Lenders or New Lenders to provide
such Incremental Facilities. Alternatively, any Lender may commit to provide the
full amount of any requested Incremental Facility and then offer portions of
such Incremental Facility to the other Lenders or other financial institutions,
subject to the approval of Administrative Agent. Nothing contained in this
paragraph or otherwise in this Agreement is intended or will be required to
commit any Lender or any Agent to provide any portion of any such additional
Incremental Facility.
(c) The Incremental Loans (i) shall rank pari passu in right of payment and of
security with the Revolving Loans; (ii) shall not mature earlier than six months
after the Revolving Credit Termination Date if they are Incremental Term Loans
or Incremental Delayed Draw Term Loans (but may, subject to clause (iii) below,
have amortization prior to such date) and shall not mature prior to the
Revolving Credit Termination Date if they are Incremental Revolving Credit
Commitments or Incremental Revolving Credit Facilities; (iii) shall not have a
weighted average life that is shorter than the then-remaining weighted average
life of the then outstanding Incremental Term Loans or Incremental Delayed Draw
Term Loans, if any; and (iv) except as set forth above, shall be treated
substantially the same as (and in any event no more favorably than) the
Revolving Loans or other Incremental Term Loans and Incremental Delayed Draw
Term Loans, as applicable (in each case, including with respect to mandatory and
voluntary prepayments); provided that (x) if the Applicable Margin relating to
any Incremental Term Facility or Incremental Delay Draw Term Facility (as
adjusted for upfront fees payable to the Lenders and original issue discount
with respect to such Incremental Facility) exceeds the Applicable Margin
relating to the Incremental Term Loans and the Incremental Delayed Draw Term
Loans immediately prior to the effectiveness of the applicable Incremental
Facility Amendments by more than 0.25%, the Applicable Margin relating to the
Incremental Term Loans and the Incremental Delayed Draw Term Loans then
outstanding shall be adjusted to an amount equal to the Applicable Margin of the
Incremental Loans (as such Applicable Margin is adjusted to reflect for upfront
fees payable to the Lenders and original issue discount of the Incremental
Loans) minus 0.25%, or (y) if the Applicable Margin (as adjusted for upfront
fees payable to the Lenders and original issue discount with respect to such
Incremental Facility) relating to any Incremental Revolving Credit Commitments
or Incremental Revolving Facility that have a maturity date that is earlier than
six months after the Revolving Credit Termination Date exceeds the Applicable
Margin relating to the Revolving Credit Loans immediately prior to the
effectiveness of the applicable Incremental Facility Amendments by more than
0.50%, the Applicable Margin relating to the Revolving Credit Facility and any
Incremental Revolving Credit Facility then outstanding shall be adjusted to an
amount equal to the Applicable Margin of the Incremental Loans (as such
Applicable Margin is adjusted to reflect for upfront fees payable to the Lenders
and original issue discount of the Incremental Facility) minus 0.50%.
(d) The Borrower and any one or more Lenders (including New Lenders) that agree
to provide any Incremental Facility shall execute and deliver to the
Administrative Agent an Incremental Facility Activation Notice specifying, in
compliance with Section 2.8(c): (i) the

 

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amount of the Incremental Loans and the Incremental Facility or Incremental
Facilities involved; (ii) the applicable Incremental Facility Effective Date
which shall be a Business Day, (iii) the maturity date for the Incremental Loans
made pursuant to such Incremental Facility or Incremental Facilities; (iv) the
amortization schedule for the Incremental Term Loans and Incremental Delayed
Draw Term Loans, as applicable, and (v) the Applicable Margin for the
Incremental Loans made pursuant to such Incremental Facility or Incremental
Facilities. Any additional bank, financial institution or other entity which,
with the consent of the Borrower and the Administrative Agent (which consent
shall not be unreasonably withheld), elects to become a “Lender” under this
Agreement in connection with any transaction described in Section 2.8(c) shall
execute a New Lender Supplement (each, a “New Lender Supplement”), substantially
in the form of Exhibit B-2, whereupon (x) such bank, financial institution or
other entity (a “New Lender”) shall become a Lender for all purposes and to the
same extent as if originally a party hereto and shall be bound by and entitled
to the benefits of this Agreement and (y) the Incremental Loans shall be treated
as “Loans” for all purposes of this Agreement, other than for purposes of the
provisions of this Agreement specifically modified or addressed in the
Incremental Facility Activation Notice.
2.9 Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay to the Administrative
Agent for the account of the appropriate Revolving Credit Lender, Swing Line
Lender, Incremental Term Lender or Incremental Delayed Draw Term Lender, as the
case may be, (i) the then unpaid principal amount of each Revolving Credit Loan
on the Revolving Credit Termination Date, (ii) the then unpaid principal amount
of each Swing Line Loan on the Revolving Credit Termination Date, (iii) the
principal amount of each Incremental Term Loan of such Incremental Term Lender
in installments according to the amortization schedule set forth in the
Incremental Facility Activation Notice with respect to the applicable
Incremental Term Loan Facility and (iv) the principal amount of each Incremental
Delayed Draw Term Loan of such Incremental Delayed Draw Term Lender in
installments according to the amortization schedule set forth in the Incremental
Facility Activation Notice with respect to applicable Incremental Delayed Draw
Term Loan Facility. The Borrower hereby further agrees to pay interest on the
unpaid principal amount of the Loans from time to time outstanding from the date
hereof until payment in full thereof at the rates per annum, and on the dates,
set forth in Section 2.16.
(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing indebtedness of the Borrower to such Lender resulting
from each Loan of such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time under
this Agreement.
(c) The Administrative Agent, on behalf of the Borrower, shall maintain the
Register pursuant to Section 10.6(d), and a subaccount therein for each Lender,
in which shall be recorded (i) the amount of each Loan made hereunder and any
Note evidencing such Loan, the Type of such Loan and each 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) both the amount of any sum received by the Administrative Agent hereunder
from the Borrower and each Lender’s share thereof.

 

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(d) The entries made in the Register and the accounts of each Lender maintained
pursuant to Section 2.9(b) shall, to the extent permitted by applicable law, be
prima facie evidence of the existence and amounts of the obligations of the
Borrower therein recorded; provided, however, that the failure of any Lender or
the Administrative Agent to maintain the Register or any such account, or any
error therein, shall not in any manner affect the obligation of the Borrower to
repay (with applicable interest) the Loans made to the Borrower by such Lender
in accordance with the terms of this Agreement.
(e) The Borrower agrees that, upon request to the Administrative Agent by any
Lender, the Borrower will promptly execute and deliver to such Lender a
promissory note of the Borrower evidencing any Incremental Term Loans,
Incremental Delayed Draw Term Loans, Revolving Credit Loans, or Swing Line
Loans, as the case may be, of such Lender, substantially in the forms of Exhibit
I-1, I-2, I-3, or I-4, respectively (an “Incremental Term Note”, an “Incremental
Delayed Draw Term Note”, a “Revolving Credit Note”, or a “Swing Line Note”,
respectively), with appropriate insertions as to date and principal amount;
provided, that delivery of Notes shall not be a condition precedent to the
making of Loans on a Borrowing Date.
2.10 Commitment Fees, etc.
(a) Revolving Credit Commitment Fees. The Borrower agrees to pay to the
Administrative Agent for the account of each Revolving Credit Lender a
commitment fee for the period from and including the Effective Date to the last
day of the Revolving Credit Commitment Period, computed at the Commitment Fee
Rate applicable to the Revolving Credit Commitment on the average daily amount
of the Available Revolving Credit Commitment of such Lender during the period
for which payment is made, payable quarterly in arrears on the last day of each
March, June, September and December and on the Revolving Credit Termination
Date, commencing on the first of such dates to occur after the date hereof.
(b) Incremental Delayed Draw Term Commitment Fees. The Borrower agrees to pay to
the Administrative Agent for the account of each Incremental Delayed Draw Term
Lender a commitment fee at the times and in the amounts provided pursuant to the
applicable Incremental Facility Activation Notice or Notices.
(c) Arrangers Fees. The Borrower agrees to pay to the Arrangers the fees in the
amounts and on the dates previously agreed to in writing by the Borrower and the
Arrangers.
(d) Administrative Agent Fees. The Borrower agrees to pay to the Administrative
Agent the fees in the amounts and on the dates from time to time agreed to in
writing by the Borrower and the Administrative Agent.
2.11 Termination or Reduction of Commitments.
(a) The Borrower shall have the right, upon not less than five Business Days’
irrevocable notice delivered to the Administrative Agent (which notice shall
specify the date and amount of such commitment reduction), to terminate the
Revolving Credit Commitments or, from time to time, reduce the unused Revolving
Credit Commitments; provided that (i) no such termination or reduction of
Revolving Credit Commitments shall be permitted if, after giving effect thereto
and to any prepayments of the Revolving Credit Loans and Swing Line Loans

 

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made on the effective date thereof, the Total Revolving Extensions of Credit
would exceed the Total Revolving Credit Commitments; (ii) each such reduction
shall be applied ratably among the Revolving Credit Lenders to permanently
reduce the Revolving Credit Commitments, and (iii) the reduction to the
aggregate Available Revolving Credit Commitments shall in no case be in an
amount which would cause the Revolving Credit Commitment of any Lender to be
reduced by an amount which exceeds the Available Revolving Credit Commitment of
such Lender as in effect immediately before giving effect to such reduction.
(b) Each Lender’s Revolving Credit Commitment shall terminate in its entirety on
the Revolving Credit Termination Date.
2.12 Optional Prepayments. The Borrower may at any time and from time to time
prepay the Loans, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the Administrative Agent at least three Business
Days prior thereto in the case of Eurodollar Loans and at least one Business Day
prior thereto in the case of Base Rate Loans, which notice shall specify the
date and amount of such prepayment, whether such prepayment is of Incremental
Term Loans, Incremental Delayed Draw Term Loans or Revolving Credit Loans, and
whether such prepayment is of Eurodollar Loans or Base Rate Loans; provided,
that (i) if a Eurodollar Loan is prepaid on any day other than the last day of
the Interest Period applicable thereto, the Borrower shall also pay any amounts
owing pursuant to Section 2.22, and (ii) no prior notice is required for the
prepayment of Swing Line Loans. Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with (except in the case of
Revolving Credit Loans that are Base Rate Loans and Swing Line Loans) accrued
interest to such date on the amount prepaid. Partial prepayments of Incremental
Term Loans, Incremental Delayed Draw Term Loans and Revolving Credit Loans shall
be in an aggregate principal amount of $1,000,000 or a whole multiple thereof.
Partial prepayments of Swing Line Loans shall be in an aggregate principal
amount of $100,000 or a whole multiple thereof.
2.13 Mandatory Prepayments and Commitment Reductions.
(a) Unless the Required Prepayment Lenders shall otherwise agree, upon any sale,
issuance or incurrence of Indebtedness (other than Indebtedness permitted
pursuant to Section 7.2) by the Borrower, then upon receipt of the Net Cash
Proceeds from such sale, issuance or incurrence, the Incremental Term Loans and
the Incremental Delayed Draw Term Loans shall be prepaid, and/or the Revolving
Credit Commitments shall be reduced, by an amount equal to the amount of such
Net Cash Proceeds, as set forth in Section 2.13(e).
(b) Unless the Required Prepayment Lenders shall otherwise agree, on any date
the Borrower or any of its Restricted Subsidiaries shall receive Net Cash
Proceeds from any Asset Sale the Incremental Term Loans and the Incremental
Delayed Draw Term Loans shall be prepaid, and/or the Revolving Credit
Commitments shall be reduced by an amount equal to the amount of such Net Cash
Proceeds, which prepayments and reductions shall be applied as set forth in
Section 2.13(e); provided, that:

 

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(i) if (x) no Default or Event of Default would exist or arise therefrom and
(y) not later than ten (10) Business Days after the date of the receipt by the
Borrower of the Net Cash Proceeds from any Asset Sale, Borrower shall have
delivered to Administrative Agent a Reinvestment Notice stating the amount of
such Net Cash Proceeds which is intended to be used to acquire assets useful in
the business of the Borrower or the applicable Restricted Subsidiary prior to
the Reinvestment Prepayment Date with respect to such Reinvestment Notice, then
the amount set forth in such Reinvestment Notice as intended to be reinvested
shall not be required to be applied as set forth in this Section 2.13(b);
(ii) to the extent such Net Cash Proceeds are from an Asset Sale of Collateral,
the assets in which such Net Cash Proceeds are reinvested must also be
Collateral; and
(iii) if all or any portion of such Net Cash Proceeds are not reinvested in
assets in accordance with the applicable Reinvestment Notice (and in the case of
Net Cash Proceeds from an Asset Sale of Collateral, in compliance with clause
(ii) above) on or prior to the applicable Reinvestment Prepayment Date, such
remaining portion shall be applied on the applicable Reinvestment Prepayment
Date to prepay Incremental Term Loans and/or the Incremental Delayed Draw Term
Loans and/or to reduce the Revolving Credit Commitments, all in accordance with
Section 2.13(e).
(c) Unless the Required Prepayment Lenders shall otherwise agree, on any date
the Borrower or any of its Restricted Subsidiaries shall receive Net Cash
Proceeds from any Recovery Event, the Incremental Term Loans and the Incremental
Delayed Draw Term Loans shall be prepaid, and/or the Revolving Credit
Commitments shall be reduced by an amount equal to the amount of such Net Cash
Proceeds, which prepayments and reductions shall be applied as set forth in
Section 2.13(e); provided, that
(i) if (x) no Default or Event of Default would exist or arise therefrom and
(y) not later than ten (10) Business Days after the date of the receipt by the
Borrower of the Net Cash Proceeds from any Recovery Event, Borrower shall have
delivered to Administrative Agent a Reinvestment Notice stating the amount of
such Net Cash Proceeds which is intended to be used to acquire assets useful in
the business of the Borrower or the applicable Restricted Subsidiary prior to
the Reinvestment Prepayment Date with respect to such Reinvestment Notice, then
the amount set forth in such Reinvestment Notice as intended to be reinvested
shall not be required to be applied as set forth in this Section 2.13(c);
(ii) to the extent such Net Cash Proceeds are from a Recovery Event with respect
to Collateral, the assets in which such Net Cash Proceeds are reinvested must
also be Collateral; and
(iii) if all or any portion of such Net Cash Proceeds are not reinvested in
assets in accordance with the applicable Reinvestment Notice (and in the case of
Net Cash Proceeds from a Recovery Event with respect to Collateral, in
compliance with clause (ii) above) on or prior to the applicable Reinvestment
Prepayment Date, such

 

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remaining portion shall be applied on the applicable Reinvestment Prepayment
Date to prepay Incremental Term Loans and/or the Incremental Delayed Draw Term
Loans and/or to reduce the Revolving Credit Commitments, all in accordance with
Section 2.13(e); provided, however, that if any portion has not been used prior
to the applicable Reinvestment Prepayment Date and Borrower is diligently
pursuing the reinvestment of such amount, then such application of the remaining
portion shall not be required for so long as such reinvestment is being
diligently pursued.
Notwithstanding the foregoing provisions of Section 2.13(b) and Section 2.13(c),
up to $50,000,000 of Net Cash Proceeds of Asset Sales and Recovery Events
received by Borrower and its Restricted Subsidiaries from and after January 1,
2010, shall be excluded from the mandatory prepayment provisions contained in
Section 2.13(b) and Section 2.13(c).
(d) Unless the Required Prepayment Lenders shall otherwise agree, commencing
with fiscal year 2009, if there shall be Excess Cash Flow, then, on the relevant
Excess Cash Flow Application Date, the Incremental Term Loans and the
Incremental Delayed Draw Term Loans shall be prepaid and/or the Revolving Credit
Commitments shall be reduced, by an amount equal to 50% of such Excess Cash
Flow, as set forth in Section 2.13(e). Each such prepayment and commitment
reduction shall be made on a date (an “Excess Cash Flow Application Date”) no
later than five (5) days after the earlier of (i) the date on which the
financial statements of the Borrower referred to in Section 6.1(a), for the
fiscal year with respect to which such prepayment is made, are required to be
delivered to the Lenders and (ii) the date such financial statements are
actually delivered.
(e) Amounts to be applied in connection with prepayments and Commitment
reductions made pursuant to clauses (a), (b), (c), or (d) of this Section 2.13
shall be allocated, first, if any Incremental Term Facility or Incremental
Delayed Draw Term Facility is then outstanding pro rata to such Incremental
Facility or Facilities, to be applied (x) with respect to any Incremental Term
Facility, for the benefit of all Incremental Term Lenders in accordance with
their respective Incremental Term Percentages as a prepayment towards the
Incremental Term Loans and (y) with respect to any Incremental Delayed Draw Term
Facility, the then unfunded Incremental Delayed Draw Term Commitments will be
reduced by the lesser of the amount of such prepayment allocated to the
Incremental Delayed Draw Term Facility and the then amount of the unfunded
Incremental Delayed Draw Term Commitments, and if the amount of such prepayment
applied to such Incremental Delayed Draw Term Facility is greater than the then
unfunded Incremental Delayed Draw Term Commitments, such excess shall be
allocated, for the benefit of all applicable Incremental Delayed Draw Term
Lenders in accordance with their respective Incremental Delayed Draw Term
Percentages as a prepayment towards the funded Incremental Delayed Draw Term
Loans, and second, to reduce permanently the Revolving Credit Commitments;
provided that the Revolving Credit Commitments shall not be required to be
reduced below $200,000,000. Any such reduction of the Revolving Credit
Commitments shall be accompanied by prepayment of the Revolving Credit Loans
and/or Swing Line Loans to the extent, if any, that the Total Revolving
Extensions of Credit exceed the amount of the Total Revolving Credit Commitments
as so reduced, provided that if the aggregate principal amount of Revolving
Credit Loans and Swing Line Loans then outstanding is less than the amount of
such excess (because L/C Obligations constitute a portion thereof), the Borrower
shall, to the extent of the balance of such excess, replace outstanding Letters
of Credit and/or

 

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deposit an amount in Cash into a cash collateral account subject to
documentation reasonably satisfactory to the Administrative Agent.
(f) The Borrower shall provide each of the Incremental Term Lenders and the
Incremental Delayed Draw Term Lenders with five (5) Business Days prior written
notice of each such prepayment and any Incremental Term Lender or Incremental
Delayed Draw Term Lender, at its option, may elect, so long as there are any
Incremental Term Loans or Incremental Delayed Draw Term Loans outstanding, not
to accept its ratable portion of such prepayment in which event the provisions
of the next sentence shall apply. Any Incremental Term Lender or Incremental
Delayed Draw Term Lender declining such prepayment (each such Lender being a
“Declining Term Loan Lender” and the amount of such Lender’s ratable portion of
such prepayment being the “Declined Term Amount”) shall give written notice to
the Administrative Agent substantially in the form of Exhibit Q (each, a
“Declining Lender Notice”), by 11:00 A.M. (New York City Time) on the Business
Day immediately preceding the date on which such prepayment would otherwise be
made and then the Declined Term Amount for all Declining Term Loan Lenders may
be retained by the Borrower; provided, that if part or all of a Declined Term
Amount consists of proceeds from the sale or other disposition of Collateral
(“Collateral Proceeds”), the portion of any Declined Term Amount that consists
of Collateral Proceeds shall be paid to all Lenders that are not Declining Term
Loan Lenders (the “Accepting Term Loan Lenders,” and each such Accepting Term
Loan Lender being an “Accepting Term Loan Lender”) on a pro-rata basis based
upon the total amount outstanding (including all accrued but unpaid interest)
then owed by Borrower to each such Accepting Term Loan Lender along with any
prepayment amount to be paid pursuant to this Section 2.13; provided, further,
that in the event that the Collateral Proceeds exceed the total amount owed to
Accepting Term Loan Lenders following mandatory prepayments under this
Section 2.13 (other than the Collateral Proceeds), such amount shall be returned
to the Borrower.
2.14 Conversion and Continuation Options.
(a) The Borrower may elect from time to time to convert Eurodollar Loans to Base
Rate Loans by giving the Administrative Agent at least two Business Days’ prior
irrevocable notice of such election, provided that any such conversion of
Eurodollar Loans may be made only on the last day of an Interest Period with
respect thereto. The Borrower may elect from time to time to convert Base Rate
Loans to Eurodollar Loans by giving the Administrative Agent at least three
Business Days’ prior irrevocable notice of such election (which notice shall
specify the length of the initial Interest Period therefor), provided that no
Base Rate Loan under a particular Facility may be converted into a Eurodollar
Loan (i) when any Event of Default has occurred and is continuing and the
Administrative Agent has, or the Majority Facility Lenders in respect of such
Facility have, determined in its or their sole discretion not to permit such
conversions or (ii) after the date that is one month prior to the final
scheduled termination or maturity date of such Facility. Upon receipt of any
such notice the Administrative Agent shall promptly notify each relevant Lender
thereof.
(b) The Borrower may elect to continue any Eurodollar Loan as such upon the
expiration of the then current Interest Period with respect thereto by giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term “Interest Period” set forth in Section 1.1, of
the length of the next Interest Period to be applicable to such

 

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Loans, provided that no Eurodollar Loan under a particular Facility may be
continued as such (i) when any Event of Default has occurred and is continuing
and the Administrative Agent has, or the Majority Facility Lenders in respect of
such Facility have, determined in its or their sole discretion not to permit
such continuations or (ii) after the date that is one month prior to the final
scheduled termination or maturity date of such Facility, and provided, further,
that if the Borrower shall fail to give any required notice as described above
in this paragraph or if such continuation is not permitted pursuant to the
preceding proviso, such Loans shall be converted automatically to Base Rate
Loans on the last day of such then expiring Interest Period. Upon receipt of any
such notice the Administrative Agent shall promptly notify each relevant Lender
thereof.
2.15 Minimum Amounts and Maximum Number of Eurodollar Tranches. Notwithstanding
anything to the contrary in this Agreement, all borrowings, conversions,
continuations and optional prepayments of Eurodollar Loans and all selections of
Interest Periods shall be in such amounts and be made pursuant to such elections
so that, (a) after giving effect thereto, the aggregate principal amount of the
Eurodollar Loans comprising each Eurodollar Tranche shall be equal to $1,000,000
or a whole multiple of $1,000,000 in excess thereof and (b) no more than fifteen
Eurodollar Tranches shall be outstanding at any one time.
2.16 Interest Rates and Payment Dates.
(a) Each Eurodollar Loan shall bear interest for each day during each Interest
Period with respect thereto at a rate per annum equal to the Eurodollar Rate
determined for such day plus the Applicable Margin in effect for such day.
(b) Each Base Rate Loan shall bear interest for each day on which it is
outstanding at a rate per annum equal to the Base Rate in effect for such day
plus the Applicable Margin in effect for such day.
(c) If all or a portion of the principal amount of any Loan or the amount of any
Reimbursement Obligation or the amount of any other obligation hereunder shall
not be paid when due (whether at the stated maturity, by acceleration or
otherwise), such unpaid amount (to the extent legally permitted) shall bear
interest at a rate per annum that is equal to (i) in the case of the Loans, the
rate that would otherwise be applicable thereto pursuant to the foregoing
provisions of this Section 2.16 plus 2% or (ii) in the case of Reimbursement
Obligations or any other obligations hereunder, the rate applicable to Base Rate
Loans under the Revolving Credit Facility plus 2%, in each case, with respect to
clauses (i) and (ii) above, from the date of such non-payment until the date
such amount is paid in full (after as well as before judgment).
(d) Interest shall be payable in arrears on each Interest Payment Date, provided
that interest accruing pursuant to paragraph (c) of this Section shall be
payable from time to time on demand.
2.17 Computation of Interest and Fees.
(a) Interest, fees, commissions payable pursuant hereto shall be calculated on
the basis of a 360-day year for the actual days elapsed, except that, with
respect to Base Rate Loans on which interest is calculated on the basis of the
Prime Rate, the interest thereon shall be

 

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calculated on the basis of a 365 (or 366, as the case may be) day year for the
actual days elapsed. The Administrative Agent shall as soon as practicable
notify the Borrower and the relevant Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the Base Rate or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.
(b) Each determination of an interest rate by the Administrative Agent pursuant
to any provision of this Agreement shall be conclusive and binding on the
Borrower and the Lenders in the absence of manifest error. The Administrative
Agent shall, at the request of the Borrower, deliver to the Borrower a statement
showing the quotations used by the Administrative Agent in determining any
interest rate pursuant to Section 2.16(a).
2.18 Inability to Determine Interest Rate. If prior to the first day of any
Interest Period:
(a) the Administrative Agent shall have determined (which determination shall be
conclusive and binding upon the Borrower) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate for such Interest Period, or
(b) the Administrative Agent shall have received notice from the Majority
Facility Lenders in respect of the relevant Facility that the Eurodollar Rate
determined or to be determined for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (as conclusively certified by such
Lenders) of making or maintaining their affected Loans during such Interest
Period, the Administrative Agent shall give telecopy or telephonic notice
thereof to the Borrower and the relevant Lenders as soon as practicable
thereafter. If such notice is given (x) any Eurodollar Loans under the relevant
Facility requested to be made on the first day of such Interest Period shall be
made as Base Rate Loans, (y) any Loans under the relevant Facility that were to
have been converted on the first day of such Interest Period to Eurodollar Loans
shall be continued as Base Rate Loans and (z) any outstanding Eurodollar Loans
under the relevant Facility shall be converted, on the last day of the then
current Interest Period with respect thereto, to Base Rate Loans. Until such
notice has been withdrawn by the Administrative Agent, no further Eurodollar
Loans under the relevant Facility shall be made or continued as such, nor shall
the Borrower have the right to convert Loans under the relevant Facility to
Eurodollar Loans.
2.19 Pro Rata Treatment and Payments.
(a) Each borrowing by the Borrower from the Lenders hereunder and any reduction
of the Commitments of the Lenders and, except as provided otherwise in
Section 2.27, each payment by the Borrower on account of any commitment fee or
Letter of Credit fee, shall be made pro rata according to the respective
Incremental Term Percentages, Incremental Delayed Draw Term Percentages or
Revolving Credit Percentages, as the case may be, of the relevant Lenders. Each
payment (other than prepayments) in respect of principal or interest in respect
of the Incremental Term Loans and Incremental Delayed Draw Term Loans and each

 

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payment in respect of fees payable hereunder shall be applied to the amounts of
such obligations owing to the Lenders pro rata according to the respective
amounts then due and owing to the Lenders.
(b) Each payment (including each prepayment) of the Incremental Term Loans shall
be allocated among the Incremental Term Lenders pro rata based on the principal
amount of such Incremental Term Loans held by such Incremental Term Lenders, and
shall be applied pro rata to the installments of such Incremental Term Loans;
provided however that, subject to the provisions of Section 2.8(c), it shall not
be a violation of this Section 2.19(b) if the Borrower pays different interest
rates on Incremental Term Loans under different Incremental Term Facilities.
Amounts prepaid on account of the Incremental Term Loans may not be reborrowed.
(c) Each payment (including each prepayment) of the Incremental Delayed Draw
Term Loans shall be allocated among the Incremental Delayed Draw Term Lenders
pro rata based on the principal amount of such Incremental Delayed Draw Term
Loans held by such Incremental Delayed Draw Term Lenders, and shall be applied
pro rata to the installments of such Incremental Delayed Draw Term Loans;
provided however that, subject to the provisions of Section 2.8(c), it shall not
be a violation of this Section 2.19(b) if the Borrower pays different interest
rates on Incremental Delayed Draw Term Loans under different Incremental Delayed
Draw Term Facilities. Amounts prepaid on account of the Incremental Delayed Draw
Term Loans may not be reborrowed.
(d) Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Revolving Credit Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving
Credit Loans then held by the Revolving Credit Lenders; provided however that,
subject to the provisions of Section 2.8(c), it shall not be a violation of this
Section 2.19(b) if the Borrower pays different interest rates on Revolving
Credit Loans and/or Incremental Revolving Credit Loans under different
Incremental Revolving Credit Facilities. Each payment in respect of
Reimbursement Obligations in respect of any Letter of Credit shall be made to
the Issuing Lender that issued such Letters of Credit.
(e) The application of any payment of Loans under any Facility (including
optional and mandatory prepayments) shall be made, first, to Base Rate Loans
under such Facility and, second, to Eurodollar Loans under such Facility. Each
payment of the Loans (except in the case of Swing Line Loans and Revolving
Credit Loans that are Base Rate Loans) shall be accompanied by accrued interest
to the date of such payment on the amount paid.
(f) All payments (including prepayments) to be made by the Borrower hereunder,
whether on account of principal, interest, fees or otherwise, shall be made
without setoff or counterclaim and shall be made prior to 12:00 Noon, New York
City time, on the due date thereof to the Administrative Agent, for the account
of the relevant Lenders, at the Payment Office, in Dollars and in immediately
available funds. Any payment made by the Borrower after 12:00 Noon, New York
City time, on any Business Day shall be deemed to have been on the next
following Business Day. The Administrative Agent shall distribute such payments
to the Lenders promptly upon receipt in like funds as received. If any payment
hereunder (other than payments on the Eurodollar Loans) becomes due and payable
on a day other than a Business

 

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Day, such payment shall be extended to the next succeeding Business Day. If any
payment on a Eurodollar Loan becomes due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day unless the result of such extension would be to extend such payment
into another calendar month, in which event such payment shall be made on the
immediately preceding Business Day. In the case of any extension of any payment
of principal pursuant to the preceding two sentences, interest thereon shall be
payable at the then applicable rate during such extension.
(g) Unless the Administrative Agent shall have been notified in writing by any
Lender prior to a borrowing that such Lender will not make the amount that would
constitute its share of such borrowing available to the Administrative Agent,
the Administrative Agent may assume that such Lender is making such amount
available to the Administrative Agent, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower a corresponding
amount. If such amount is not made available to the Administrative Agent by the
required time on the Borrowing Date therefor, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon at a rate
equal to the daily average Federal Funds Effective Rate for the period until
such Lender makes such amount immediately available to the Administrative Agent.
A certificate of the Administrative Agent submitted to any Lender with respect
to any amounts owing under this paragraph shall be conclusive in the absence of
manifest error. If such Lender’s share of such borrowing is not made available
to the Administrative Agent by such Lender within three Business Days after such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to Base Rate Loans
under the relevant Facility, on demand, from the Borrower.
(h) Unless the Administrative Agent shall have been notified in writing by the
Borrower prior to the date of any payment due to be made by the Borrower
hereunder that the Borrower will not make such payment to the Administrative
Agent, the Administrative Agent may assume that the Borrower is making such
payment, and the Administrative Agent may, but shall not be required to, in
reliance upon such assumption, make available to the Lenders their respective
pro rata shares of a corresponding amount. If such payment is not made to the
Administrative Agent by the Borrower within three Business Days after such due
date, the Administrative Agent shall be entitled to recover, on demand, from
each Lender to which any amount which was made available pursuant to the
preceding sentence, such amount with interest thereon at the rate per annum
equal to the daily average Federal Funds Effective Rate. Nothing herein shall be
deemed to limit the rights of the Administrative Agent or any Lender against the
Borrower.
(i) If at any time insufficient funds are received by and available to the
Administrative Agent to pay amounts of principal, unreimbursed L/C Obligations,
interest and fees then due hereunder, such funds shall be applied (i) first,
towards payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, towards payment of principal and
unreimbursed L/C Obligations.

 

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2.20 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever with respect to
this Agreement, any Letter of Credit, any Application or any Eurodollar Loan
made by it, or change the basis of taxation of payments to such Lender in
respect thereof (except for Non-Excluded Taxes covered by Section 2.21 and
changes in the rate of tax on the overall net income of such Lender);
(ii) shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of such Lender that
is not otherwise included in the determination of the Eurodollar Rate hereunder;
or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender for
such increased cost or reduced amount receivable. If any Lender becomes entitled
to claim any additional amounts pursuant to this Section, it shall promptly
notify the Borrower in writing (with a copy to the Administrative Agent) of the
event by reason of which it has become so entitled, and setting forth in such
notice, in reasonable detail, the basis and calculation of such amounts.
(b) If any Lender shall have determined that the adoption of or any change in
any Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof shall have the effect of reducing the rate of return on such
Lender’s or such corporation’s capital as a consequence of its obligations
hereunder or under or in respect of any Letter of Credit to a level below that
which such Lender or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration such Lender’s or such
corporation’s policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then from time to time, after submission by such
Lender to the Borrower (with a copy to the Administrative Agent) of a written
request therefor (which request shall set forth, in reasonable detail, the basis
and calculation of the additional amount sought), the Borrower shall pay to such
Lender such additional amount or amounts as set forth in the aforesaid notice;
provided, that the Borrower shall not be required to compensate a Lender
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prior to the date on which such Lender notified the Borrower of such Lender’s
intention to claim compensation therefor; provided, further, that, if the
circumstances giving rise to such claim have a retroactive effect, then such six
month period shall be extended to include the period of such retroactive effect.
(c) A certificate as to any additional amounts payable pursuant to this Section
submitted by any Lender to the Borrower (with a copy to the Administrative
Agent) and setting forth, in reasonable detail, the basis and calculation of
such amounts shall be conclusive in the absence of manifest error. The
obligations of the Borrower pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
2.21 Taxes.
(a) All payments made by the Borrower or any Guarantor under this Agreement or
any other Loan Document shall be made free and clear of, and without deduction
or withholding for or on account of, any present or future income, stamp or
other taxes, levies, imposts, duties, charges, fees, deductions or withholdings,
now or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding net income taxes and franchise taxes (imposed
in lieu of net income taxes) imposed on any Agent or any Lender as a result of a
present or former connection between such Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from such Agent’s or such Lender’s having executed,
delivered or performed its obligations or received a payment under, or enforced,
this Agreement or any other Loan Document). If any such non-excluded taxes,
levies, imposts, duties, charges, fees, deductions or withholdings
(“Non-Excluded Taxes”) or any Other Taxes are required to be withheld from any
amounts payable to any Agent or any Lender hereunder, the amounts so payable to
such Agent or such Lender shall be increased to the extent necessary to yield to
such Agent or such Lender (after payment of all Non-Excluded Taxes and Other
Taxes) interest or any such other amounts payable hereunder that would have been
received hereunder or under any other Loan Document had such withholding not
been required; provided, however, that neither the Borrower nor any Guarantor
shall be required to increase any such amounts payable to any Lender with
respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s
failure to comply with the requirements of paragraph (e) or (f) of this Section
or (ii) that are United States withholding taxes imposed on amounts payable to
such Lender at the time such Lender becomes a party to this Agreement, except to
the extent that such Lender’s assignor (if any) was entitled, at the time of
assignment, to receive additional amounts from the Borrower or a Guarantor with
respect to such Non-Excluded Taxes pursuant to this paragraph (a). The Borrower
or the applicable Guarantor shall make any such required withholding and pay the
full amount withheld to the relevant tax authority or other Governmental
Authority in accordance with applicable Requirements of Law.
(b) In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.
(c) Borrower shall indemnify the Administrative Agent and each Lender within
twenty (20) days after written demand therefor, for the full amount of any
Non-Excluded

 

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Taxes or Other Taxes (including Non-Excluded Taxes or Other Taxes imposed on or
attributable to amounts payable under this Section 2.21) paid by the
Administrative Agent or such Lender and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto (subject to the remaining
provisions of this Section 2.21 and provided that this Section 2.21(c) shall not
apply to the extent that any such amounts are compensated for by an increased
payment under Section 2.21(a)). A certificate stating the amount of such payment
or liability and setting forth in reasonable detail the calculation thereof
delivered to the Borrower by the Administrative Agent or a Lender (with a copy
to the Administrative Agent), or by the Administrative Agent on its own behalf
or on behalf of a Lender shall be conclusive absent manifest error; provided,
that if the Borrower objects to any payment or liability within ten (10) days of
receipt of such certificate, the Lender or the Administrative Agent shall work
in good faith with the Borrower to resolve any such objection
(d) Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower,
as promptly as possible thereafter the Borrower shall send to the Administrative
Agent for the account of the relevant Agent or Lender, as the case may be, a
certified copy of an original official receipt received by the Borrower showing
payment thereof. If the Borrower fails to pay any Non-Excluded Taxes or Other
Taxes when due to the appropriate taxing authority or fails to remit to the
Administrative Agent the required receipts or other required documentary
evidence, the Borrower shall indemnify the Agents and the Lenders for any
incremental taxes, interest or penalties that may become payable by any Agent or
any Lender as a result of any such failure. The agreements in this Section shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
(e) Each Lender (or Transferee) that is not a “United States Person” within the
meaning of Section 7701(a)(30) of the Code (a “Non-U.S. Lender”) shall deliver
to the Borrower and the Administrative Agent (or, in the case of a Participant,
to the Lender from which the related participation shall have been purchased)
(i) two copies of either U.S. Internal Revenue Service Form W-8BEN or Form
W-8ECI, (ii) in the case of a Non-U.S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of “portfolio interest” a statement substantially in the form of
Exhibit J and a Form W-8BEN, or (iii) two copies of Internal Revenue Service
Form W-8IMY (together with forms listed under clauses (i) or (ii) hereof, as may
be required) or any subsequent versions thereof or successors thereto, in each
case, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Loan Documents
together with such supplementary documentation as may be prescribed by
applicable law and reasonably requested by the Borrower or the Administrative
Agent to permit such Person to determine the withholding or deduction required
to be made. Such forms shall be delivered by each Non-U.S. Lender on or before
the date it becomes a party to this Agreement (or, in the case of any
Participant, on or before the date such Participant purchases the related
participation). In addition, each Non-U.S. Lender shall deliver such forms
promptly upon the obsolescence or invalidity of any form previously delivered by
such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify the Borrower at
any time it determines that it is no longer in a position to provide any
previously delivered certificate to the Borrower (or any other form of
certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other

 

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provision of this paragraph, a Non-U.S. Lender shall not be required to deliver
any form pursuant to this paragraph that such Non-U.S. Lender is not legally
able to deliver.
(f) A Lender that is entitled to an exemption from or reduction of non-U.S.
withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender’s reasonable judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.
2.22 Indemnity. The Borrower agrees to indemnify each Lender for, and to hold
each Lender harmless from, any loss or expense that such Lender may sustain or
incur as a consequence of (a) default by the Borrower in making a borrowing of,
conversion into or continuation of Eurodollar Loans after the Borrower has given
a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of this
Agreement or (c) the making of a prepayment or conversion of Eurodollar Loans on
a day that is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest that would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans provided
for herein (excluding, however, the Applicable Margin included therein, if any)
over (ii) the amount of interest (as reasonably determined by such Lender) that
would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank Eurodollar
market. A certificate as to any amounts payable pursuant to this Section
submitted to the Borrower by any Lender shall be conclusive in the absence of
manifest error. This covenant shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.
2.23 Illegality. Notwithstanding any other provision herein, if the adoption of
or any change in any Requirement of Law or in the interpretation or application
thereof shall make it unlawful for any Lender to make or maintain Eurodollar
Loans as contemplated by this Agreement, (a) the commitment of such Lender
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Base Rate Loans to Eurodollar Loans shall forthwith be canceled and
(b) such Lender’s Loans then outstanding as Eurodollar Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurodollar Loan occurs on
a day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 2.22.

 

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2.24 Change of Lending Office. Each Lender agrees that, upon the occurrence of
any event giving rise to the operation of Section 2.20, Section 2.21(a) or
Section 2.23 with respect to such Lender, it will, if requested by the Borrower,
use reasonable efforts (subject to overall policy considerations of such Lender)
to designate another lending office for any Loans affected by such event with
the object of avoiding the consequences of such event; provided, that such
designation is made on terms that, in the sole judgment of such Lender, cause
such Lender and its lending office(s) to suffer no economic, legal or regulatory
disadvantage, and provided, further, that nothing in this Section shall affect
or postpone any of the obligations of any Borrower or the rights of any Lender
pursuant to Section 2.20, Section 2.21(a) or Section 2.23.
2.25 Replacement of Lenders. If any Lender (a) requests reimbursement for
amounts owing pursuant to Section 2.20(a) or Section 2.21(a), (b) is affected in
the manner described in Section 2.23 and as a result thereof any of the actions
described in such Section 2.23 is required to be taken, (c) becomes a Defaulting
Lender, or (d) refuses to consent to an amendment, modification or waiver
pursuant to Section 10.1, then the Borrower may, at its sole expense and effort,
upon notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse, all of its interests, rights and
obligations under this Agreement and the related Loan Documents to an Assignee
that shall assume such obligations (which Assignee may be another Lender, if a
Lender accepts such assignment), provided that (i) the Borrower shall have paid
to the Administrative Agent the registration and processing fee (if applicable),
(ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder and under the other Loan Documents
from such Assignee (to the extent of such outstanding principal, accrued
interest, fees and/or breakage costs) or the Borrower (in the case of all other
amounts), (iii) such Assignee is able to make, maintain or continue, as
applicable, Eurodollar Loans, and (iv) such assignment does not conflict with
any applicable Law. A Lender shall not be required to make any such assignment
or delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.
2.26 Back-Stop Arrangements.
(a) Section 2.7 and Section 3.9 contemplate Back-Stop Arrangements in certain
circumstances to support the issuance of Letters of Credit and funding of Swing
Line Loans. The Borrower, and to the extent provided by any Revolving Credit
Lender (which is provided solely at the option of such Revolving Credit Lender),
such Revolving Credit Lender, hereby grants to the Administrative Agent, for the
benefit of the Administrative Agent, the L/C Issuers, the Revolving Credit
Lenders and the Swing Line Lender, a security interest in all such cash, deposit
accounts and all balances therein, and all other property provided as collateral
pursuant to Section 2.7 and Section 3.9, and all proceeds of the foregoing. Cash
collateral shall be maintained in blocked, interest bearing deposit accounts at
the Administrative Agent. For the avoidance of doubt, to the extent that any
other Person may have a claim, by virtue of an intercreditor arrangement,
tag-along right or any other term in any other document or instrument, to share
in any Back-Stop Arrangement provided pursuant to any of the aforementioned
sections of this Agreement, the L/C Issuers, the Swing Line Lender or the
Administrative Agent, as applicable, may take such provisions into account in
determining whether any Back-Stop Arrangement is satisfactory.

 

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(b) Notwithstanding anything to the contrary contained in this Agreement,
Back-Stop Arrangements provided by any Defaulting Lender pursuant to Section 2.7
or Section 3.9 to support the obligations of such Lender in respect of Letters
of Credit or Swing Line Loans shall be held and applied, first, to fund the
participations of such Lender in Letters of Credit and Swing Line Loans, or such
Lender’s Revolving Credit Percentage of Revolving Credit Loans used to repay L/C
Obligations or Swing Line Loans with respect to which Back-Stop Arrangements
were provided, as applicable, and, second, to fund any interest accrued for the
benefit of the Issuing Lender or Swing Line Lender pursuant to Section 2.7(d) or
Section 3.4(b) and Section 2.16(c) allocable to such Lender.
(c) Back-Stop Arrangements shall be released (except as the Issuing Lender
and/or the Swing Line Lender and the Person providing such Back-Stop
Arrangements may agree otherwise (as applicable)) promptly following the earlier
to occur of (i) the termination of such Lender’s status as a Defaulting Lender;
(ii) following the applicable Issuing Lender’s or the Swing Line Lender’s (as
applicable) good faith determination that there remain outstanding no L/C
Obligations or Swing Line Loans, as applicable, as to which it has actual or
potential Fronting Exposure in relation to such Defaulting Lender as to which it
desires to maintain Back-Stop Arrangements; or (iii) following the replacement
of such Lender as provided for in Section 2.25 of this Agreement and the
assumption of such Defaulting Lender’s Commitments by the applicable replacement
Lender.
2.27 Defaulting Lenders. Notwithstanding anything to the contrary contained in
this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then,
until such time as such Lender is no longer a Defaulting Lender, to the extent
permitted by applicable Law:
(a) Waivers and Amendments. Such Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement shall
be restricted as set forth in Section 10.1.
(b) Reallocation of Loan Payments. (i) Any payment or prepayment of any portion
of the principal amount of Revolving Credit Loans of such Lender (whether
voluntary or mandatory, at maturity, pursuant to Section 8 or otherwise) shall
be applied, first, to the Revolving Credit Loans of other Lenders as if such
Defaulting Lender had no Loans outstanding, until such time as the Revolving
Credit Extensions of each Revolving Credit Lender shall equal its Revolving
Credit Percentage of the Total Revolving Extensions of Credit (without giving
effect to Section 2.27(d)) ratably to the Revolving Credit Lenders in accordance
with their Revolving Credit Percentages of Revolving Credit Loans being repaid
or prepaid; second, to the then outstanding amounts (including interest thereon)
owed under the terms hereof by such Defaulting Lender to the Administrative
Agent or (to the extent the Administrative Agent has received notice thereof) to
any other Lender, ratably to the Persons entitled thereto, and third, to the
posting of Cash Collateral in respect of its Revolving Credit Percentage of the
L/C Obligations and the Swing Line Loans, ratably to the Issuing Lenders and the
Swing Line Lender in accordance with their respective applicable Fronting
Exposures, and (ii) any other amounts thereafter received by the Administrative
Agent for the account of such Defaulting Lender (including amounts made
available to the Administrative Agent by such Defaulting Lender pursuant to
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above referred to in item second of clause (i) above, and second, to the matters
above referred to in item third of clause (i) above. Any payments, prepayments
or other amounts paid or payable to a Defaulting Lender that are reallocated to
pay outstanding amounts owed by a Defaulting Lender or to provide Back-Stop
Arrangements pursuant to this Section 2.27(b) shall be deemed paid to such
Defaulting Lender, and each Lender hereby irrevocably consents thereto.
(c) Certain Fees. Such Defaulting Lender (i) shall not be entitled to receive
any commitment fee pursuant to Section 2.10(a) or Section 2.10(b) for any period
during which such Lender is a Defaulting Lender (and the Borrower shall not be
required to pay any such fee that otherwise would have been required to have
been paid to such Defaulting Lender); and (ii) shall only be entitled to receive
any fee pursuant to Section 3.3(a) for any period during which such Lender is a
Defaulting Lender only to extent allocable to its Revolving Credit Percentage of
the stated amount Letters of Credit for which Letter of Credit Back-Stop
Arrangements have been provided by such Lender pursuant to Section 3.9, as
applicable (and the Borrower shall (x) be required to pay to each Issuing
Lender, as applicable, the amount of such fee allocable to its Fronting Exposure
arising from such Defaulting Lender and (y) not be required to pay the remaining
amount of such fee that otherwise would have been required to have been paid to
such Defaulting Lender).
(d) Reallocation of Applicable Percentages to Reduce Fronting Exposure. During
any period in which there is a Defaulting Lender as to which the Issuing Lenders
or the Swing Line Lender (as applicable) has not received Back-Stop Arrangements
acceptable to it in respect of the related participation and funding obligations
of such Defaulting Lender, then for purposes of computing the amount of the
obligation of each non-Defaulting Lender to acquire, refinance or fund
participations in Letters of Credit or Swing Line Loans pursuant to
Section 2.4(b), Section 2.4(c) and Section 3.4, the “Revolving Credit
Percentage” of each non-Defaulting Lender shall be computed without giving
effect to the Revolving Credit Commitment of such Defaulting Lender; provided,
that, in all cases, the obligation of each non-Defaulting Lender to acquire,
refinance or fund participations in Letters of Credit or Swing Line Loans shall
not exceed the positive difference, if any, between (1) the Revolving Credit
Commitment of such non-Defaulting Lender and (2) the Revolving Extension of
Credit of such Lender.
A Lender that has become a Defaulting Lender because of an event referenced in
the definition of Defaulting Lender may cure such status and shall no longer
constitute a Defaulting Lender as a result of such event when (i) such
Defaulting Lender shall have fully funded or paid, as applicable, all Loans,
participations in respect of Letters of Credit or Swing Line Loans or other
amounts required to be funded or paid by it hereunder as to which it is
delinquent (together, in each case, with such interest thereon as shall be
required to be paid to any Person as otherwise provided in this Agreement),
(ii) the Administrative Agent and the Borrower shall have received a
certification by such Defaulting Lender of its ability and intent to comply with
the provisions of this Agreement going forward, and (iii) each of (v) the
Administrative Agent, (w) each Issuing lender, (x) the Swing Line Lender,
(y) any other Lender as to which a delinquent obligation was owed, and (z) in
the case of the failure to fund any Loan, the Borrower, shall have determined
(and notified the Administrative Agent) that they are satisfied, in their sole
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Defaulting Lender intends to continue to perform its obligations as a Lender
hereunder and has all approvals required to enable it, to continue to perform
its obligations as a Lender hereunder. No reference in this subsection to an
event being “cured” shall preclude any claim by any Person (including the
Borrower) against any Lender that becomes a Defaulting Lender for such direct
damages as may otherwise be available to such Person arising from any failure to
fund or pay any amount when due hereunder or from any other event that gives
rise to any Lender becoming a Defaulting Lender.
SECTION 3.
LETTERS OF CREDIT
3.1 L/C Commitment.
(a) Subject to the terms and conditions hereof, each Issuing Lender, in reliance
on the agreements of the other Revolving Credit Lenders set forth in
Section 3.4(a), agrees to issue standby letters of credit and, to the extent
available from such Issuing Lender, commercial letters of credit (collectively,
the “Letters of Credit”) for the account of the Borrower on any Business Day
from the Effective Date until the Revolving Credit Termination Date in such form
as may be approved from time to time by such Issuing Lender; provided, that no
Issuing Lender shall have any obligation to issue any Letter of Credit if, after
giving effect to such issuance, (i) the L/C Obligations would exceed the L/C
Commitment or (ii) the aggregate amount of the Available Revolving Credit
Commitments would be less than zero. Each Letter of Credit shall (i) be
denominated in Dollars and (ii) expire no later than the earlier of (x) the
first anniversary of its date of issuance and (y) the date which is five
Business Days prior to the Revolving Credit Termination Date; provided that any
Letter of Credit with a one-year term may provide for the renewal thereof for
additional one-year periods (which shall in no event extend beyond the date
referred to in clause (y) above). The parties hereto agree that the Existing
Letters of Credit shall be deemed to be Letters of Credit issued under and
pursuant to the provisions of this Section 3.1(a).
(b) Notwithstanding the foregoing, no Letter of Credit shall be issued the
Stated Amount of which, when added to the L/C Obligations then outstanding (in
each case exclusive of Payment Amounts which are repaid on the date of, and
prior to the issuance of, the respective Letter of Credit) at such time would
exceed (x) the L/C Commitment and (y) when added to the aggregate outstanding
principal amount of all Revolving Credit Loans and all Swing Line Loans then
outstanding, the Total Revolving Credit Commitment.
(c) No Issuing Lender shall at any time be obligated to issue any Letter of
Credit hereunder if such issuance would conflict with, or cause such Issuing
Lender or any L/C Participant to exceed any limits imposed by, any applicable
Requirement of Law.
3.2 Procedure for Issuance of Letter of Credit. The Borrower may from time to
time request that an Issuing Lender issue a Letter of Credit by delivering to
such Issuing Lender and the Administrative Agent at their addresses for notices
specified herein an Application therefor, completed to the satisfaction of such
Issuing Lender, and such other certificates, documents and other papers and
information as such Issuing Lender may request.

 

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Upon receipt of any Application, an Issuing Lender will process such Application
and the certificates, documents and other papers and information delivered to it
in connection therewith in accordance with its customary procedures and shall
promptly issue the Letter of Credit requested thereby by issuing the original of
such Letter of Credit to the beneficiary thereof or as otherwise may be agreed
to by such Issuing Lender and the Borrower (but in no event shall any Issuing
Lender be required to issue any Letter of Credit earlier than three Business
Days after receipt by such Issuing Lender and the Administrative Agent of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto). Promptly after issuance by an Issuing Lender
of a Letter of Credit, such Issuing Lender shall furnish a copy of such Letter
of Credit to the Borrower and the Administrative Agent. Each Issuing Lender
shall promptly give notice to the Administrative Agent of the issuance of each
Letter of Credit issued by such Issuing Lender (including the amount thereof).
3.3 Fees and Other Charges.
(a) The Borrower will pay a fee on the aggregate drawable amount of all
outstanding Letters of Credit in consideration of the L/C Participations noted
in Section 3.4 below at a per annum rate equal to the Applicable Margin then in
effect with respect to Eurodollar Loans under the Revolving Credit Facility,
shared ratably among the Revolving Credit Lenders in accordance with their
respective Revolving Credit Percentages and payable quarterly in arrears on each
L/C Fee Payment Date after the issuance date; provided, however, any such fee
otherwise payable for the account of a Defaulting Lender with respect to any
Letter of Credit as to which such Defaulting Lender has not provided cash
collateral or other credit support arrangements satisfactory to the applicable
L/C Issuer pursuant to Section 3.1(c) shall be payable, to the maximum extent
permitted by applicable law, to the other Revolving Lenders in accordance with
the upward adjustments in their respective Revolving Credit Percentages
allocable to such Letter of Credit pursuant to Section 2.27(d), with the balance
of such fee, if any, payable to the applicable L/C Issuer for its own account.
In addition, the Borrower shall pay to the relevant Issuing Lender for its own
account a fronting fee (in an amount to be agreed to by the Borrower and such
Issuing Lender) on the aggregate drawable amount of all outstanding Letters of
Credit issued by it, which fee shall be payable quarterly in arrears on the last
day of each March, June, September and December, and the Revolving Credit
Termination Date.
(b) In addition to the foregoing fees, the Borrower shall pay or reimburse each
Issuing Lender for such normal and customary costs and expenses as are incurred
or charged by such Issuing Lender in issuing, negotiating, effecting payment
under, amending or otherwise administering any Letter of Credit.
3.4 L/C Participations.
(a) Each Issuing Lender irrevocably agrees to grant and hereby grants to each
L/C Participant, and, to induce each Issuing Lender to issue Letters of Credit
hereunder, each L/C Participant irrevocably agrees to accept and purchase and
hereby accepts and purchases from each Issuing Lender, on the terms and
conditions hereinafter stated, for such L/C Participant’s own account and risk,
a participation interest as described below. Each L/C Participant shall be
deemed to have irrevocably accepted and purchased from such Issuing

 

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Lender and hereby accepts and purchases from each Issuing Lender, on the terms
and conditions hereinafter stated, for such L/C Participant’s own account and
risk, an undivided interest equal to such L/C Participant’s Revolving Credit
Percentage in each Issuing Lender’s obligations and rights under each Letter of
Credit issued by such Issuing Lender hereunder and the amount of each draft paid
by such Issuing Lender thereunder. Each L/C Participant unconditionally and
irrevocably agrees with each Issuing Lender that, if a draft is paid under any
Letter of Credit issued by such Issuing Lender for which such Issuing Lender is
not reimbursed in full by the Borrower in accordance with the terms of this
Agreement, such L/C Participant shall pay to the Administrative Agent, for the
account of such Issuing Lender, upon demand at the Administrative Agent’s
Payment Office (and thereafter the Administrative Agent shall promptly pay to
such Issuing Lender) an amount equal to such L/C Participant’s Revolving Credit
Percentage of the amount of such draft, or any part thereof, that is not so
reimbursed. Upon any change in the respective Revolving Credit Commitments or
Revolving Credit Percentages of the Lenders pursuant to the terms hereof, it is
hereby agreed that, with respect to all such outstanding Letters of Credit and,
in each case, any related Payment Amounts, there shall be an automatic
adjustment to the participations pursuant to this Section 3.4 to reflect the new
Revolving Credit Percentages of the assignor and assignee Lender or of all
Lenders with respective Revolving Credit Commitments, as applicable.
(b) If any amount required to be paid by any L/C Participant to the
Administrative Agent, for the account of an Issuing Lender, pursuant to
Section 3.4(a) in respect of any unreimbursed portion of any payment made by
such Issuing Lender under any Letter of Credit is not paid to such Issuing
Lender within three Business Days after the date such payment is due, such
Issuing Lender shall so notify the Administrative Agent, who shall notify such
L/C Participant and such L/C Participant shall pay to the Administrative Agent,
for the account of such Issuing Lender on demand (and thereafter the
Administrative Agent shall promptly pay to such Issuing Lender) an amount equal
to the product of (i) such amount, times (ii) the daily average Federal Funds
Effective Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to such
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to
Section 3.4(a) is not made available to the Administrative Agent, for the
account of such Issuing Lender, by such L/C Participant within three Business
Days after the date such payment is due, the Administrative Agent on behalf of
such Issuing Lender shall be entitled to recover from such L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to Base Rate Loans under the Revolving Credit
Facility. A certificate the Administrative Agent submitted on behalf of such
Issuing Lender submitted to any L/C Participant with respect to any such amounts
owing under this Section shall be conclusive in the absence of manifest error.
(c) Whenever, at any time after an Issuing Lender has made payment under any
Letter of Credit and has received from the Administrative Agent or any L/C
Participant its pro rata share of such payment in accordance with
Section 3.4(a), such Issuing Lender receives any payment related to such Letter
of Credit (whether directly from the Borrower or otherwise, including proceeds
of collateral applied thereto by such Issuing Lender), or any payment of
interest on account thereof, such Issuing Lender will distribute to the
Administrative Agent, for the account of such L/C Participant (and thereafter
the Administrative Agent shall promptly pay

 

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such L/C Participant), its pro rata share thereof; provided, however, that in
the event that any such payment received by such Issuing Lender shall be
required to be returned by such Issuing Lender, such L/C Participant shall
return to the Administrative Agent, for the account of such Issuing Lender (and
thereafter the Administrative Agent shall promptly pay to such Issuing Lender),
the portion thereof previously distributed by such Issuing Lender.
3.5 Reimbursement Obligation of the Borrower. The Borrower agrees to reimburse
each Issuing Lender, on each date on which such Issuing Lender notifies the
Borrower of the date and amount of a draft presented under any Letter of Credit
and paid by such Issuing Lender, for the amount of (a) such draft so paid and
(b) any taxes, fees, charges or other costs or expenses incurred by such Issuing
Lender in connection with such payment (the amounts described in the foregoing
clauses (a) and (b) in respect of any drawing, collectively, the “Payment
Amount”). Each such payment shall be made to such Issuing Lender at its address
for notices specified herein in lawful money of the United States of America and
in immediately available funds. Interest shall be payable on each Payment Amount
from the date of the applicable drawing until payment in full at the rate set
forth in (i) until the second Business Day following the date of the applicable
drawing, Section 2.16(b) and (ii) thereafter, Section 2.16(c). Each drawing
under any Letter of Credit shall (unless an event of the type described in
clause (i) or (ii) of Section 8(f) shall have occurred and be continuing with
respect to the Borrower, in which case the procedures specified in Section 3.4
for funding by L/C Participants shall apply) constitute a request by the
Borrower to the Administrative Agent for a borrowing pursuant to Section 2.5 of
Base Rate Loans (or, at the option of the Administrative Agent and the Swing
Line Lender in their sole discretion, a borrowing pursuant to Section 2.7 of
Swing Line Loans) in the amount of such drawing. The Borrowing Date with respect
to such borrowing shall be the first date on which a borrowing of Revolving
Credit Loans (or, if applicable, Swing Line Loans) could be made, pursuant to
Section 2.5 (or, if applicable, Section 2.7), if the Administrative Agent had
received a notice of such borrowing at the time the Administrative Agent
receives notice from the relevant Issuing Lender of such drawing under such
Letter of Credit.
3.6 Obligations Absolute. The Borrower’s obligations under this Section 3 shall
be absolute and unconditional under any and all circumstances and irrespective
of any setoff, counterclaim or defense to payment that the Borrower may have or
have had against any Issuing Lender, any beneficiary of a Letter of Credit or
any other Person. The Borrower also agrees with each Issuing Lender that such
Issuing Lender shall not be responsible for, and the Borrower’s Reimbursement
Obligations under Section 3.5 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even though
such documents shall in fact prove to be invalid, fraudulent or forged, or any
dispute between or among the Borrower and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Borrower against any beneficiary of such Letter of
Credit or any such transferee. No Issuing Lender shall be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Letter of Credit,
except for errors or omissions found by a final and nonappealable decision of a
court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of such Issuing Lender. The Borrower agrees that any action
taken or omitted by an Issuing Lender under or in connection with any Letter of
Credit issued by it or the related drafts or documents, if done in the absence
of gross negligence or willful misconduct and in accordance with the standards
or care specified in

 

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the Uniform Commercial Code of the State of New York, shall be binding on the
Borrower and shall not result in any liability of such Issuing Lender to the
Borrower.
3.7 Letter of Credit Payments. If any draft shall be presented for payment under
any Letter of Credit, the relevant Issuing Lender shall promptly notify the
Borrower of the date and amount thereof. The responsibility of the relevant
Issuing Lender to the Borrower in connection with any draft presented for
payment under any Letter of Credit, in addition to any payment obligation
expressly provided for in such Letter of Credit issued by such Issuing Lender,
shall be limited to determining that the documents (including each draft)
delivered under such Letter of Credit in connection with such presentment appear
on their face to be in conformity with such Letter of Credit.
3.8 Applications. To the extent that any provision of any Application related to
any Letter of Credit is inconsistent with the provisions of this Section 3, the
provisions of this Section 3 shall apply.
3.9 Lender Defaults. No Issuing Lender shall have any obligation to issue any
Letter of Credit if (a) any Revolving Credit Lender is at such time a Defaulting
Lender or (b) such Issuing Lender, in its reasonable discretion, determines that
there may be a risk of one or more Revolving Credit Lender becoming a Defaulting
Lender, unless, in either case, such Issuing Lender has entered into
arrangements satisfactory to such Issuing Lender and the Borrower to eliminate
such Issuing actual or potential Fronting Exposure with respect to such
Revolving Credit Lender, including by cash collateralizing such Revolving Credit
Lender’s Revolving Credit Percentage of L/C Obligations then outstanding (such
arrangements, the “Letter of Credit Back-Stop Arrangements”).
SECTION 4.
REPRESENTATIONS AND WARRANTIES
To induce the Agents and the Lenders to enter into this Agreement and to make
the Loans and issue or participate in the Letters of Credit, the Borrower hereby
represents and warrants to each Agent and each Lender that:
4.1 Financial Condition.
(a) The unaudited pro forma balance sheet of the Borrower and its consolidated
Subsidiaries as of September 30, 2009 (including the notes thereto) (the “Pro
Forma Balance Sheet”), copies of which have heretofore been furnished to each
Lender, has been prepared giving effect to the transactions contemplated by this
Agreement (as if such events had occurred on such date) and based on the best
information available to the Borrower as of the date of delivery thereof, and
presents fairly on a pro forma basis the estimated financial position of the
Borrower and its consolidated Subsidiaries as of September 30, 2009, assuming
such transactions had actually occurred at such date.
(b) The audited consolidated and unaudited consolidating balance sheets of the
Borrower as of December 31, 2008, and as of the most recent fiscal year for
which financial

 

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statements are required to be delivered under Section 6.1(a) and the related
consolidated and consolidating statements of income and consolidated statements
of cash flows for the fiscal years ended on such dates, in the case of
consolidated financial statements, reported on by and accompanied by an
unqualified report from a “Big Four” accounting firm or other independent
certified public accountant reasonably acceptable to the Administrative Agent,
in each case, present fairly the consolidated financial condition of the
Borrower and its Subsidiaries as at such date, and the consolidated results of
its operations and its consolidated cash flows for the respective fiscal years
then ended. All such financial statements, including the related schedules and
notes thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned firm
of accountants and disclosed therein).
(c) The unaudited consolidated and consolidating balance sheets of the Borrower
as of September 30, 2009, and as of the most recent fiscal quarter for which
financial statements are required to be delivered under Section 6.1(b) and the
related consolidated and consolidating statements of income and consolidated
statements of cash flows for the fiscal quarter and the year-to-date ended on
such dates, in each case, present fairly the consolidated and consolidating
financial condition of the Borrower and its Subsidiaries as at such date, and
the consolidated and consolidating results of its operations and its
consolidated cash flows for the respective fiscal period then ended (subject to
year end adjustments). All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed therein).
(d) The Borrower and its Subsidiaries do not have any material Guarantee
Obligations, contingent liabilities and liabilities for taxes, or any long-term
leases other than those not prohibited hereunder or unusual forward or long-term
commitments, including, without limitation, any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, that are not reflected in the most recent financial statements
referred to in this Section 4.1.
4.2 No Change. Since December 31, 2008 there has been no development or event
that has had or could reasonably be expected to have a Material Adverse Effect.
4.3 Organizational Existence; Compliance with Law. Each of the Borrower and its
Restricted Subsidiaries, other than Immaterial Subsidiaries, (a) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (b) has the organizational power and
authority, and the legal right, to own and operate its Property, to lease the
Property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified as a foreign entity and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of Property or the conduct of its business requires such qualification
except to the extent that the failure to be so qualified or be in good standing
could not reasonably be expected to have a Material Adverse Effect, and (d) is
in compliance with all Requirements of Law except to the extent that the failure
to comply therewith could not, in the aggregate, reasonably be expected to have
a Material Adverse Effect.

 

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4.4 Organizational Power; Authorization; Enforceable Obligations. Each Loan
Party has the organizational power and authority, and the legal right, to make,
deliver and perform the Loan Documents to which it is a party and, in the case
of the Borrower, to borrow hereunder. Each Loan Party has taken all necessary
corporate or other action to authorize the execution, delivery and performance
of the Loan Documents to which it is a party and, in the case of the Borrower,
to authorize the borrowings on the terms and conditions of this Agreement. No
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required in
connection with the borrowings hereunder or the execution, delivery,
performance, validity or enforceability of this Agreement or any of the other
Loan Documents, except (i) consents, authorizations, filings and notices which
have been obtained or made and are in full force and effect; and certain
consents, authorization, filings and notices specifically identified on
Schedule 4.4 which have not been obtained, but have been requested and are
anticipated to be received in the due course of business of the applicable party
from whom such consent or authorization has been requested and (ii) the filings
referred to in Section 4.19 and Section 6.11. Each Loan Document has been duly
executed and delivered on behalf of each Loan Party that is a party thereto.
This Agreement constitutes, and each other Loan Document upon execution will
constitute, a legal, valid and binding obligation of each Loan Party that is a
party thereto, enforceable against each such Loan Party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
4.5 No Legal Bar. The execution, delivery and performance of this Agreement and
the other Loan Documents, the issuance of Letters of Credit, the borrowings
hereunder and the use of the proceeds thereof will not violate in any material
respect any Requirement of Law or any Contractual Obligation of the Borrower or
any of its Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual Obligation (other
than the Liens created by the Security Documents). No Requirement of Law or
Contractual Obligation applicable to the Borrower or any of its Subsidiaries
could reasonably be expected to have a Material Adverse Effect.
4.6 No Material Litigation. No litigation, action, suit, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of the Borrower, threatened by or against the Borrower or any
of its Subsidiaries or against any of their respective properties or revenues
(a) with respect to any of the Loan Documents or any of the transactions
contemplated hereby or thereby except proceedings of the Gaming Boards
identified on Schedule 4.4, or (b) that could reasonably be expected to have a
Material Adverse Effect.
4.7 No Default. Neither the Borrower nor any of its Subsidiaries is in default
under or with respect to any of its Contractual Obligations in any respect that
could reasonably be expected to have a Material Adverse Effect. No Default or
Event of Default has occurred and is continuing.

 

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4.8 Ownership of Property; Liens. Each of the Borrower and its Restricted
Subsidiaries has marketable and insurable title to, or a valid leasehold
interest in, all its material real property, and good title to, or a valid
leasehold interest in, all its other material Property, and the Property is not
subject to any Lien except as permitted by Section 7.3.
4.9 Intellectual Property. The Borrower and its Restricted Subsidiaries own, or
are licensed to use, all material Intellectual Property necessary for the
conduct of their business as currently conducted, taken as a whole. No material
claim has been asserted and is pending by any Person challenging or questioning
the use of any such Intellectual Property or the validity or effectiveness of
any such Intellectual Property in a manner that reasonably could be expected to
result in a Material Adverse Effect, nor does the Borrower know of any valid
basis for any such claim. The use of such Intellectual Property by the Borrower
and its Restricted Subsidiaries does not infringe on the rights of any Person in
any material respect in a manner that reasonably could be expected to result in
a Material Adverse Effect.
4.10 Taxes. Each of the Borrower and each of its Restricted Subsidiaries has
filed or caused to be filed all federal, state and other material tax returns
that are required to be filed and has paid all material taxes shown to be due
and payable on said returns or on any assessments made against it or any of its
Property and all other taxes, fees or other charges imposed on it or any of its
Property by any Governmental Authority (other than those with respect to which
the amount or validity thereof is being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of the Borrower or its Subsidiaries, as the case may be);
and no tax Lien, other than Liens permitted under Section 7.3(a), has been
filed, and, to the knowledge of the Borrower, no claim is being asserted, with
respect to any such tax, fee or other charge.
4.11 Federal Regulations. No part of the proceeds of any Loans will be used for
“purchasing” or “carrying” any “margin stock” (within the respective meanings of
each of the quoted terms under Regulation U as now and from time to time
hereafter in effect) in a manner that is in violation of any of the Regulations
of the Board or for any purpose that otherwise violates the provisions of the
Regulations of the Board. If requested by any Lender or the Administrative
Agent, the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR
Form G-3 or FR Form U-1, as applicable, referred to in Regulation U.
4.12 Labor Matters. There are no strikes or other labor disputes against the
Borrower or any of its Subsidiaries pending or, to the knowledge of the
Borrower, threatened that (individually or in the aggregate) could reasonably be
expected to have a Material Adverse Effect. Hours worked by and payment made to
employees of the Borrower and its Subsidiaries have not been in violation of the
Fair Labor Standards Act or any other applicable Requirement of Law dealing with
such matters that (individually or in the aggregate) could reasonably be
expected to have a Material Adverse Effect. All payments due from the Borrower
or any of its Subsidiaries on account of employee health and welfare insurance
that (individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect if not paid have been paid or accrued as a liability on
the books of the Borrower or the relevant Subsidiary.

 

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4.13 ERISA. None of (i) a Reportable Event, (ii) any failure by any Plan to
satisfy the minimum funding standard applicable to such Plan under Section 412
or 430 of the Code or Section 302 or 303 of ERISA, or (iii) any “accumulated
funding deficiency” (within the meaning of Section 412 of the Code or
Section 302 of ERISA) with respect to any Plan has occurred during the five-year
period prior to the date on which this representation is made or deemed made
with respect to any Plan, and each Plan has complied in all material respects
with the applicable provisions of ERISA and the Code except where such
noncompliance could not reasonably be expected to result in a Material Adverse
Effect. No termination of a Single Employer Plan has occurred, and no Lien in
favor of the PBGC or a Plan has arisen, during such five-year period. The
present value of all accrued benefits under each Single Employer Plan (based on
those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits by a material amount. Except those arising out of the operations of the
Atlantic City Entities (which arose prior to January 1, 2010 and all of the
related liabilities have been paid), neither the Borrower nor any Commonly
Controlled Entity has had a complete or partial withdrawal from any
Multiemployer Plan that has resulted or could reasonably be expected to result
in a material liability under ERISA, and neither the Borrower nor any Commonly
Controlled Entity would become subject to any material liability under ERISA if
the Borrower or any such Commonly Controlled Entity were to withdraw completely
from all Multiemployer Plans as of the valuation date most closely preceding the
date on which this representation is made or deemed made. No such Multiemployer
Plan is in Reorganization or Insolvent.
4.14 Investment Company Act; Other Regulations. No Loan Party is an “investment
company”, or a company “controlled” by an “investment company”, within the
meaning of the Investment Company Act of 1940, as amended. No Loan Party is
subject to regulation under any Requirement of Law (other than Regulation X of
the Board) which limits its ability to incur Indebtedness.
4.15 Subsidiaries.
(a) The Subsidiaries listed on Schedule 4.15(a) constitute all the Subsidiaries
of the Borrower at the Effective Date. Schedule 4.15(a) sets forth as of the
Effective Date the name and jurisdiction of formation of each Subsidiary and, as
to each Subsidiary, the percentage of each class of Capital Stock owned by each
Loan Party. Schedule 4.15(a) also identifies all of the Unrestricted
Subsidiaries and Immaterial Subsidiaries as of the Effective Date.
(b) As of the Effective Date, there are no outstanding subscriptions, options,
warrants, calls, rights or other agreements or commitments (other than (a) stock
options granted to employees or directors and directors’ qualifying shares, and
(b) with respect to the Capital Stock of the Borrower, subscriptions, options,
warrants, calls, rights or other agreements or commitments to which the Borrower
is not a party) of any nature relating to any Capital Stock of the Borrower or
any Subsidiary, except as disclosed on Schedule 4.15(b).
4.16 Use of Proceeds. The proceeds of the Incremental Term Loans and Incremental
Delayed Draw Term Loans shall be used for general corporate purposes of the
Borrower and its Restricted Subsidiaries, including (i) to repay the revolving
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Agreement and for fees and expenses associated therewith, (ii) to pay the fees
and expenses related to this amendment and restatement of this Agreement, and
(iii) to pay for all or a portion of the Expenses associated with the Unfinished
Projects and any other development property. The proceeds of the Revolving
Credit Loans shall be used for general corporate purposes of the Borrower and
its Restricted Subsidiaries, including (i) to pay for all or a portion of the
Expenses associated with the Unfinished Projects and any other development
property, and (ii) to pay the fees and expenses related to this amendment and
restatement of the Existing Credit Agreement; provided that, the proceeds of the
Revolving Credit Loans may not be used to make an optional prepayment of
Incremental Term Loans.
4.17 Environmental Matters. Other than exceptions to any of the following that
could not, individually or in the aggregate, reasonably be expected to result in
a Material Adverse Effect:
(a) The Borrower and its Subsidiaries: (i) are, and within the period of all
applicable statutes of limitation have been, in compliance with all applicable
Environmental Laws; (ii) hold all Environmental Permits (each of which is in
full force and effect) required for any of their current or intended operations
or for any property owned, leased, or otherwise operated by any of them;
(iii) are, and within the period of all applicable statutes of limitation have
been, in compliance with all of their Environmental Permits; and (iv) reasonably
believe that: each of their Environmental Permits will be timely renewed and
complied with, without material expense; any additional Environmental Permits
that may be required of any of them will be timely obtained and complied with,
without material expense; and compliance with any Environmental Law that is or
is expected to become applicable to any of them will be timely attained and
maintained, without material expense.
(b) Materials of Environmental Concern are not present at, on, under, in, or
about any real property now or formerly owned, leased or operated by the
Borrower or any of its Subsidiaries, or at any other location (including,
without limitation, any location to which Materials of Environmental Concern
have been sent for re-use or recycling or for treatment, storage, or disposal)
which could reasonably be expected to (i) give rise to liability of the Borrower
or any of its Subsidiaries under any applicable Environmental Law or otherwise
result in costs to the Borrower or any of its Subsidiaries, or (ii) interfere
with the Borrower’s or any of its Subsidiaries’ continued operations, or
(iii) impair the fair saleable value of any real property owned or leased by the
Borrower or any of its Subsidiaries.
(c) There is no judicial, administrative, or arbitral proceeding (including any
notice of violation or alleged violation) under or relating to any Environmental
Law to which the Borrower or any of its Subsidiaries is, or to the knowledge of
the Borrower or any of its Subsidiaries will be, named as a party that is
pending or, to the knowledge of the Borrower or any of its Subsidiaries,
threatened.
(d) Neither the Borrower nor any of its Subsidiaries has received any written
request for information, or been notified that it is a potentially responsible
party under or relating to the federal Comprehensive Environmental Response,
Compensation, and Liability Act or any similar Environmental Law, or with
respect to any Materials of Environmental Concern.

 

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(e) Neither the Borrower nor any of its Subsidiaries has entered into or agreed
to any consent decree, order, or settlement or other agreement, or is subject to
any judgment, decree, or order or other agreement, in any judicial,
administrative, arbitral, or other forum for dispute resolution, relating to
compliance with or liability under any Environmental Law.
(f) Neither the Borrower nor any of its Subsidiaries has assumed or retained, by
contract or operation of law, any liabilities of any kind, fixed or contingent,
known or unknown, under any Environmental Law or with respect to any Material of
Environmental Concern.
4.18 Accuracy of Information, etc. No statement or information (other than
projections and pro forma financial information) contained in this Agreement,
any other Loan Document, the Confidential Information Memorandum or any other
document, certificate or statement furnished to the Administrative Agent or the
Lenders or any of them, by or on behalf of any Loan Party for use in connection
with the transactions contemplated by this Agreement or the other Loan
Documents, contained as of the date such statement, information, document or
certificate was so furnished (giving effect to any updates and/or supplements
which were provided prior to the date of making this representation), any untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements contained herein or therein not misleading. The
financial projections and pro forma financial information in the material
referenced above are based upon good faith estimates and assumptions believed by
management of the Borrower to be reasonable at the time made, it being
recognized by the Lenders that because the projections are based on estimates
and assumptions as to future events, they are inherently uncertain and actual
results during the period or periods covered by such projections may differ from
the projected results set forth therein by a material amount. There is no fact
known to any Loan Party that could reasonably be expected to have a Material
Adverse Effect that has not been expressly disclosed herein, in the other Loan
Documents, in the Confidential Information Memorandum or in any other documents,
certificates and statements furnished to the Agents and the Lenders for use in
connection with the transactions contemplated hereby and by the other Loan
Documents.
4.19 Security Documents.
(a) The Security Documents (including, to the extent that amendments to any
Pledge Agreements (Gaming Regulated) are required in connection with this
Agreement, after the execution and delivery of the applicable Post-Closing
Gaming Pledge Agreement Amendment, each such Pledge Agreements (Gaming
Regulated)) are effective to create in favor of the Administrative Agent, for
the benefit of the Secured Parties, a legal, valid and enforceable security
interest in the Collateral described therein and proceeds thereof. From and
after execution and delivery thereof, the Post-Closing Gaming Pledges will be
effective to create in favor of the Administrative Agent, for the benefit of the
Secured Parties, a legal, valid and enforceable security interest in the
Collateral described therein and proceeds thereof. In the case of the Pledged
Stock pledged in favor of the Administrative Agent pursuant to the Pledge
Agreements, when any certificates representing such Pledged Stock that is a
security under Section 8-102(a)(15) of the UCC are delivered to the
Administrative Agent, and in the case of the other Collateral described in the
Security Documents as to which a security interest can be perfected by filing of
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appropriate form are filed in the offices specified on Schedule 4.19(a) (which
financing statements have been duly completed and delivered to the
Administrative Agent), the security interests created by the Security Documents
securing such Collateral shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the Loan Parties in such
Collateral and the proceeds thereof, as security for the Obligations, in each
case prior and superior in right to any other Person (except, in the case of
Collateral other than Pledged Stock, Liens permitted by Section 7.3).
(b) Each of the Mortgages is effective to create in favor of the Administrative
Agent, for the benefit of the Secured Parties, a legal, valid and enforceable
Lien on the Mortgaged Properties described therein and proceeds thereof; and
each Mortgage shall (as of the Effective Date in the case of the Mortgages filed
on or prior to the Effective Date (after giving effect to the amendments set
forth on Schedule 4.19(b) (which have been executed and delivered to the
Administrative Agent)) and when such Mortgage is filed in the recording office
designated by the Borrower in the case of any Mortgage to be executed and
delivered pursuant to Section 6.10(b)) constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the Loan Parties in the
Mortgaged Properties described therein and the proceeds thereof, as security for
the Obligations (as defined in the relevant Mortgage), in each case prior and
superior in right to any other Person (other than Persons holding Liens or other
encumbrances or rights permitted by the relevant Mortgage).
4.20 Solvency. The Borrower and its Subsidiaries, taken as a whole, are, and
after giving effect to the incurrence of all Indebtedness and obligations being
incurred in connection herewith will be and will continue to be, Solvent.
4.21 Senior Indebtedness. The Obligations constitute “Senior Debt” of the
Borrower under and as defined in the Indentures governing Subordinated
Obligations or Permitted Refinancing Subordinated Obligations. The obligations
of each Subsidiary Guarantor under the Subsidiary Guaranty constitute “Guarantor
Senior Indebtedness” of such Subsidiary Guarantor under and as defined in the
Indentures governing Subordinated Obligations or Permitted Refinancing
Subordinated Obligations.
4.22 Regulation H. No Mortgage encumbers improved real property which is located
in an area that has been identified by the Secretary of Housing and Urban
Development as an area having special flood hazards and in which flood insurance
has been made available under the National Flood Insurance Act of 1968 (except
any Mortgaged Properties as to which such flood insurance as required by
Regulation H has been obtained and is in full force and effect as required by
this Agreement).
4.23 Gaming Laws. The Borrower and the Restricted Subsidiaries are in compliance
with all applicable Gaming Laws in all respects which are applicable to the
operations, businesses and prospects of the Borrower and the Restricted
Subsidiaries, taken as a whole except where such noncompliance could not
reasonably be expected to result in a Material Adverse Effect.
4.24 Insurance Proceeds. The Estimated Business Interruption Insurance included
in the most recent certificate delivered by the Borrower pursuant to Section 6.2
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good faith estimate of the aggregate amount to be received with respect to
business interruption insurance for the applicable periods with respect to the
Property of the Borrower or its Restricted Subsidiaries.
4.25 Sugarcane Bay Lease. As of the Effective Date, the Borrower and the
applicable Restricted Subsidiary are in the process of negotiating modifications
to the Sugarcane Bay Lease with the lessor thereunder.
SECTION 5.
CONDITIONS PRECEDENT
5.1 Conditions to Initial Extension of Credit. The agreement of each Lender to
make the initial extension of credit requested to be made by it hereunder is
subject to the satisfaction, prior to or concurrently with the making of such
extension of credit on the Effective Date, of the following conditions
precedent:
(a) Loan Documents. The Administrative Agent shall have received (i) this
Agreement, executed and delivered by a duly authorized officer of the Borrower,
the Administrative Agent and each Lender, (ii) a ratification of the Subsidiary
Guaranty, executed and delivered by a duly authorized officer of each Subsidiary
Guarantor, (iii) a ratification of each of the Security Documents (including the
Mortgages with respect to each of the Mortgaged Properties) executed and
delivered by each party thereto, (iv) if not previously delivered pursuant to
the Existing Credit Agreement, a Lender Addendum executed and delivered by each
Lender with a Revolving Credit Commitment and accepted by the Borrower, and
(v) such changes to the other Loan Documents as may be reasonably requested by
the Administrative Agent or the Lead Arrangers to reflect the amendment and
restatement of the Existing Credit Agreement and the changes incorporated as a
result of such amendment and restatement pursuant to this Agreement.
(b) No Default. No Default or Event of Default shall have occurred and be
continuing on the Effective Date after giving effect to the extensions of credit
to be made on such date and the application of the proceeds of such extensions
of credit.
(c) Financial Statements, Pro-Forma Balance Sheet and Projections. The Lenders
shall have received (i) audited consolidated balance sheet of the Borrower and
its consolidated Subsidiaries as at the end of fiscal year 2008 and the related
audited consolidated statements of income and of cash flows for such year,
(ii) the unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of the most recent fiscal quarter end 45
days prior to the Effective Date and the related unaudited consolidated
statements of income and of cash flows for such quarter and the portion of the
fiscal year through the end of such quarter and (iii) the Pro Forma Balance
Sheet, together with customary pro forma financial statements and financial
projections reasonably acceptable to the Lead Arranger. There shall not have
occurred any event, development or circumstance since December 31, 2008 that has
caused or could reasonably be expected to have a Material Adverse Effect or that
calls into question in any material respect the projections previously supplied
to the Lenders or any of the material assumptions on which such projections were
prepared.

 

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(d) Approvals. All governmental and third party approvals (excluding only the
consents and approvals listed on Schedule 4.4 attached hereto) necessary or, in
the discretion of the Administrative Agent, advisable in connection with the
transactions contemplated by this Agreement and the continuing operations of the
Borrower and its Subsidiaries as presently conducted shall have been obtained
and be in full force and effect or otherwise applied for or requested (and the
Borrower has no reason to believe that they will not be obtained in due course),
and all applicable waiting periods shall have expired without any action being
taken or threatened by any competent authority which would restrain, prevent or
otherwise impose adverse conditions on the financing contemplated hereby.
(e) Termination of Revolving Credit Commitments; Amendment and Restatement of
the Existing Credit Agreement. The Administrative Agent shall have received
evidence (in a form reasonably satisfactory to the Administrative Agent) that
the Borrower has terminated all Revolving Credit Commitments under the Existing
Credit Agreement as of the Effective Date and paid all amounts due to the
Lenders under the Existing Credit Agreement (as in effected immediately prior to
the amendment restatement pursuant to this Agreement). In connection with the
foregoing and the execution and delivery of this Agreement, the Existing Credit
Agreement shall be simultaneously amended and restated pursuant to the terms
hereof, and arrangements satisfactory to the Administrative Agent shall have
been made for the amendment of Liens and security interests granted in
connection therewith.
(f) Fees. The Arrangers, Lenders and the Administrative Agent shall have
received all fees required to be paid, and all expenses for which invoices have
been presented (including reasonable fees, disbursements and other charges of
counsel to the Agents), on or before the Effective Date. All such amounts will
be paid with proceeds of Loans made on the Effective Date and will be reflected
in the funding instructions given by the Borrower to the Administrative Agent on
or before the Effective Date.
(g) Business Plan. The Lenders shall have received a business plan for fiscal
years 2010-2014 and a satisfactory written analysis of the business and
prospects of the Borrower and its Subsidiaries for the period from the Effective
Date through the final maturity of the Facilities, all in form and substance
reasonably satisfactory to the Lenders.
(h) Solvency Analysis. The Lenders shall have received a satisfactory solvency
certificate and analysis by the chief financial officer of the Borrower in a
form reasonably acceptable to the Administrative Agent, which shall document the
solvency of the Borrower and its Restricted Subsidiaries considered as a whole
after giving effect to the transactions contemplated hereby, in form and
substance reasonably satisfactory to the Lenders.
(i) Lien Searches. The Administrative Agent shall have received the results of
recent lien searches in each of the jurisdictions in which Uniform Commercial
Code financing statement or other filings or recordations should be made to
evidence or perfect security interests in all or any portion of the assets of
the Loan Parties (including, without limitation, tax liens, judgments,
litigation, trademark liens, ship mortgages and UCC filings), and such searches
shall reveal no liens on any of the assets of the Loan Parties, except for Liens
permitted by Section 7.3.

 

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(j) Flood Insurance. The Administrative Agent shall have received (i) a policy
of flood insurance that (x) covers any parcel of improved real property that is
encumbered by any Mortgage that is in a designated flood zone and for which
insurance can be obtained under the National Flood Insurance Act of 1968; (y) is
written in an amount not less than the outstanding principal amount of the
indebtedness secured by such Mortgage that is reasonably allocable to such real
property or the maximum limit of coverage made available with respect to the
particular type of property under the National Flood Insurance Act of 1968,
whichever is less; and (z) has a term ending not later than the maturity of the
indebtedness secured by such Mortgage or that may be extended to such maturity
date; and (ii) confirmation that the Borrower has received the notice required
pursuant to Section 208(e)(3) of Regulation H of the Board.
(k) Closing Certificate. The Administrative Agent shall have received a
certificate of each Loan Party, dated the Effective Date, substantially in the
form of Exhibit K, with appropriate insertions and attachments.
(l) Legal Opinions. The Lenders shall have received satisfactory opinions of
counsels (including opinions of appropriate local counsels in relevant
jurisdictions) to the Borrower and the Guarantors (which shall cover, among
other things, authority, legality, validity, binding effect and enforceability
of this Agreement and the other Loan Documents as amended or otherwise modified
in connection with this Agreement and the validity of the Liens pursuant to the
Security Documents). Each such legal opinion shall cover such other matters
incident to the transactions contemplated by this Agreement as are customary for
similar transactions.
(m) Corporate Documents. Such certificates with respect to resolutions or other
action, incumbency certificates and/or other certificates of Responsible
Officers as the Administrative Agent or the Lenders may reasonably require
evidencing the identity, authority and capacity of each Responsible Officer
thereof authorized to act as a Responsible Officer in connection with this
Agreement and the other Loan Documents to which such Loan Party is a party.
(n) No Litigation. There is no action, suit, investigation or proceeding pending
or, to the knowledge of the Borrower, threatened in any court or before any
arbitrator or governmental authority that could reasonably be expected to have a
Material Adverse Effect.
(o) Pledged Stock; Stock Powers. To the extent not previously delivered, the
Administrative Agent shall have received the certificates representing the
shares of Capital Stock that are securities under Section 8-102(a)(15) of the
UCC pledged pursuant to the Pledge Agreements, together with an undated power or
assignment for each such certificate executed in blank by a duly authorized
officer of the pledgor thereof; provided, the Lenders and Administrative Agent
acknowledge that the perfection of security interest in Capital Stock subject to
the Pledge Agreements (Gaming Regulated) requires prior approval of such Pledge
Agreements (Gaming Regulated) by the applicable Gaming Boards.
(p) Filings, Registrations and Recordings. The Administrative Agent shall have
received evidence reasonably satisfactory to the Administrative Agent and the
Arrangers that the Liens created pursuant to the Security Document continue on
and after the Effective Date to be valid and perfected Liens (excluding any
Liens that can only be perfected by entering

 

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into control agreements), prior and superior in right to any other Person (other
than with respect to Liens expressly permitted by Section 7.3), and that each
document (including, without limitation, any Uniform Commercial Code financing
statement) required by the Security Documents or under law or reasonably
requested by the Administrative Agent to be filed, registered or recorded in
order to maintain such perfection and priority in favor of the Administrative
Agent, for the benefit of the Secured Parties shall have been filed, registered
or recorded or shall have been delivered to the Administrative Agent and be in
proper form for filing, registration or recordation.
(q) Title Insurance. The Administrative Agent shall have received, and the title
insurance company shall have issued such endorsements to the mortgagee’s
extended coverage (ALTA) title insurance policy in respect of each Mortgaged
Property as the Administrative Agent may reasonably request.
(r) Insurance. To the extent not previously delivered, the Administrative Agent
shall have received insurance certificates evidencing that the requirements of
this Agreement and the Mortgages with respect to the maintenance of insurance
have been satisfied.
5.2 Conditions to Each Extension of Credit. The agreement of each Lender to make
any extension of credit requested to be made by it hereunder on any date
(including, without limitation, its initial extension of credit on the Effective
Date) is subject to the satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the representations and warranties
made by any Loan Party in or pursuant to the Loan Documents shall be true and
correct in all material respects on and as of such date as if made on and as of
such date.
(b) No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit
requested to be made on such date and the application of the proceeds of such
extensions of credit.
(c) Pro Forma Compliance. With respect to the closing of any Incremental
Facility, after giving pro forma effect to the funding of all Incremental Loans
funded under such Incremental Facility on the Incremental Facility Effective
Date, and the application of the proceeds thereof on such funding date, the
Borrower is in pro forma compliance with the Financial Condition Covenants set
forth in Section 7.1 as of the last day of the most recently ended fiscal
quarter of the Borrower, with respect to which financial statements have been
delivered or required to be delivered pursuant to Section 6.1(a) or
Section 6.1(b), as if such Incremental Loans had been outstanding on the last
day of such fiscal quarter of the Borrower for testing compliance therewith.

 

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SECTION 6.
AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in effect,
any Letter of Credit remains outstanding or any Loan or other amount is owing to
any Lender or any Agent hereunder, the Borrower shall and shall cause each of
its Restricted Subsidiaries to:
6.1 Financial Statements. Furnish to the Administrative Agent:
(a) as soon as available, but in any event within 90 days after the end of each
fiscal year of the Borrower, (i) a copy of the audited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of such
year and the related audited consolidated statements of income and of cash flows
for such year, setting forth in each case in comparative form the figures as of
the end of and for the previous year, reported on without a “going concern” or
like qualification or exception, or qualification arising out of the scope of
the audit, by a “Big Four” accounting firm or other independent certified public
accountant reasonably acceptable to the Administrative Agent; and
(ii) supporting consolidating financial information in a form reasonably
acceptable to the Administrative Agent;
(b) as soon as available, but in any event not later than 45 days after the end
of each of the first three quarterly periods of each fiscal year of the
Borrower, (i) the unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated statements of income and of cash flows for such quarter
and the portion of the fiscal year through the end of such quarter, setting
forth in each case in comparative form the figures as of the end of and for the
corresponding period in the previous year, and (ii) supporting consolidating
financial information in a form reasonably acceptable to the Administrative
Agent, in each case; certified by a Responsible Officer as being fairly stated
in all material respects (subject to normal year-end audit adjustments); and
(c) as soon as available, but in any event not later than 45 days after the end
of each month occurring during each fiscal year of the Borrower (other than the
third, sixth, ninth and twelfth such month), the unaudited consolidated balance
sheets of the Borrower and its Subsidiaries as at the end of such month and the
related unaudited consolidated statement of income for such month and the
portion of the fiscal year through the end of such month, setting forth in each
case in comparative form the figures as of the end of and for the corresponding
period in the previous year, certified by a Responsible Officer as being fairly
stated in all material respects (subject to year-end audit adjustments);
all such financial statements to be complete and correct in all material
respects and to be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
6.2 Certificates; Other Information; Construction Monitoring. Furnish to the
Administrative Agent and, in case of clauses (g) and (h) hereof, to the
Construction Consultant:
(a) concurrently with the delivery of the financial statements referred to in
Section 6.1(a), a certificate of the independent certified public accountants
reporting on such

 

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financial statements stating that in making the examination necessary therefor
no knowledge was obtained of any Default or Event of Default, except as
specified in such certificate (it being understood that such certificate shall
be limited to the items that independent certified public accountants are
permitted to cover in such certificates pursuant to their professional standards
and customs of the profession);
(b) concurrently with the delivery of any financial statements pursuant to
Section 6.1, (i) a certificate of a Responsible Officer stating that, to the
best of such Responsible Officer’s knowledge, each Loan Party during such period
has observed or performed all of its covenants and other agreements, and
satisfied every condition, contained in this Agreement and the other Loan
Documents to which it is a party to be observed, performed or satisfied by it,
and that such Responsible Officer has obtained no knowledge of any Default or
Event of Default except as specified in such certificate and (ii) in the case of
quarterly or annual financial statements, a Compliance Certificate containing
all information and calculations necessary for determining compliance by the
Borrower and its Subsidiaries with the provisions of this Agreement referred to
therein as of the last day of the fiscal quarter or fiscal year of the Borrower,
as the case may be;
(c) as soon as available, and in any event no later than 45 days after the end
of each fiscal year of the Borrower, detailed quarterly consolidated budgets for
such fiscal year (including quarterly projected consolidated balance sheets of
the Borrower and its consolidated Subsidiaries as of the end of the following
fiscal year, and the related quarterly consolidated statements of projected cash
flow, quarterly projected changes in financial position and quarterly projected
income), and, as soon as available, significant revisions, if any, of such
budget and projections for such fiscal year (collectively, the “Projections”),
which Projections shall in each case be accompanied by a certificate of a
Responsible Officer stating that such Projections are based on reasonable
estimates, information and assumptions and that such Responsible Officer has no
reason to believe that such Projections are incorrect or misleading in any
material respect;
(d) if the Borrower is not required to file financial statements with the SEC,
within 45 days after the end of each fiscal quarter of the Borrower, a narrative
discussion and analysis of the financial condition and results of operations of
the Borrower and its consolidated Subsidiaries for such fiscal quarter and for
the period from the beginning of the then current fiscal year to the end of such
fiscal quarter, as compared to the portion of the Projections covering such
periods and to the comparable periods of the previous year;
(e) within five days after the same are sent, copies (or if such statements are
publicly available, notice of such availability) of all financial statements and
reports that the Borrower sends to the holders of any class of its debt
securities or public equity securities and, within five days after the same are
filed, copies of all financial statements and reports that the Borrower makes
to, or files with, the SEC;
(f) promptly, such additional financial and other information as any Lender may
from time to time reasonably request;
(g) promptly upon completion of the respective Construction Budget, Construction
Plan and Construction Timetable for any Unfinished Project, a copy of such

 

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Construction Budget, Construction Plan and Construction Timetable and thereafter
a copy of each subsequent material amendment, modification or supplement to any
such Construction Budget, Construction Plan or Construction Timetable promptly
following such amendment, modification or supplement;
(h) for each Unfinished Project, on or before the 20th day of each calendar
month (commencing with the first calendar month after (i) the Effective Date for
each Project that is an Unfinished Project on the Effective Date and (ii) the
Commencement of Construction for any Project that becomes an Unfinished Project
after the Effective Date) until such Project is no longer an Unfinished Project,
an updated line item Construction Budget and construction disbursement and
payment reconciliation for the previous month, in each case for such Unfinished
Project, and all other information with respect to such Unfinished Project
reasonably requested by the Construction Consultant with respect to the
preparation of the Monthly Construction Progress Report referred to in
Section 6.2(i) below;
(i) as soon as available, and in any event no later than 10 days after the end
of each calendar month for which the Borrower is required to comply with
Section 6.2(h) above (provided, that, if the Borrower has delivered notice to
the Administrative Agent that the Borrower intends to replace the Construction
Consultant, then such period shall be extended an additional thirty (30) days),
the Borrower shall cause the Construction Consultant to deliver a construction
progress report to the Administrative Agent in a form reasonably acceptable to
the Administrative Agent (the “Monthly Construction Progress Report”) detailing
its findings during the construction of each Unfinished Project through the
month for which information was delivered to the Construction Consultant
pursuant to clauses (g) and (h) above, including but not limited to (i) all
Expenses associated with the applicable Unfinished Project with respect to its
Construction Budget, (ii) the progress of the applicable Unfinished Project with
respect to its Construction Plan, and (iii) the status of the applicable
Unfinished Project with respect to its Construction Timetable; and
(j) if all or any portion of the Condo Component is to be developed by the
Borrower or any of its Restricted Subsidiaries, as soon as practicable, the
Borrower shall deliver to the Administrative Agent, with respect to the Condo
Component, the following information and materials (collectively, the “Condo
Information Package”):
(i) the construction budget, the construction timetable and the construction
plans and specifications; and
(ii) the organizational documents of any Person formed as a Restricted
Subsidiary to own and/or develop the Condo Component.
The Borrower shall cause representatives of the Borrower to be available to
discuss the Condo Information Package (and its contents) with the Administrative
Agent and the Construction Consultant, and shall attempt to answer and resolve
any questions the Administrative Agent may have concerning the Condo Information
Package.
6.3 Payment of Obligations. Pay, discharge or otherwise satisfy at or before
maturity or before they become delinquent, as the case may be, all its material
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whatever nature, except (a) where the amount or validity thereof is currently
being contested in good faith by appropriate proceedings, if any, and reserves
in conformity with GAAP with respect thereto have been provided on the books of
the Borrower or its Subsidiaries, as the case may be or (b) to the extent that
failure to do so could not be reasonably expected to have a Material Adverse
Effect.
6.4 Conduct of Business and Maintenance of Existence, etc.
(a) (i) Preserve, renew and keep in full force and effect its corporate or other
existence and (ii) take all reasonable action to maintain all rights, privileges
and franchises necessary or desirable in the normal conduct of its business,
except, in each case, as otherwise permitted by Section 7.4 and except, in the
case of clause (ii) above, to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect;
(b) comply with all Contractual Obligations and Requirements of Law, except
(i) to the extent that failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect, or (ii) with respect
to Contractual Obligations and/or Requirements of Law being diligently contested
in good faith; provided that the result of such contest could not reasonably be
expected to have a Material Adverse Effect; and
(c) conduct the operations of the Property subject to the Indiana Power of
Attorney (the “Indiana Gaming Property”) in a manner so as to avoid any
authorization by the Indiana Gaming Commission for the trustee under the Indiana
Power of Attorney to conduct the operations at the Indiana Gaming Property
unless such authorization and conducting of business could not reasonably be
expected to have a Material Adverse Effect.
6.5 Maintenance of Property; Insurance. (a) Except as in the aggregate could not
reasonably be expected to result in a Material Adverse Effect, keep all Property
and systems useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted and (b) maintain with financially
sound and reputable insurance companies insurance on all its Property in at
least such amounts and against at least such risks (but including in any event
public liability and business interruption) as are usually insured against in
the same general area by companies engaged in the same or a similar business.
6.6 Inspection of Property; Books and Records; Discussions. (a) Keep proper
books of records and accounts in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to the business and activities of the Borrower and
its consolidated Subsidiaries and (b) subject to any Gaming Laws restricting
such actions, permit representatives of any Lender, coordinated through the
Administrative Agent, to visit and inspect any of its properties and examine and
make abstracts from any of its books and records at any reasonable time and, if
no Default or Event of Default has occurred, upon reasonable advance notice and
as often as may reasonably be desired and to discuss the business, operations,
properties and financial and other condition of the Borrower and its
Subsidiaries with officers and employees of the Borrower and its Subsidiaries
and with its independent certified public accountants.

 

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6.7 Notices. Promptly give notice to the Administrative Agent of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual Obligation of the
Borrower or any of its Subsidiaries or (ii) litigation, investigation or
proceeding which may exist at any time between the Borrower or any of its
Subsidiaries and any Governmental Authority, that in either case, if not cured
or if adversely determined, as the case may be, could reasonably be expected to
have a Material Adverse Effect;
(c) any litigation or proceeding against the Borrower or any of its Restricted
Subsidiaries in which the amount involved is $10,000,000 or more and not covered
by insurance or which could reasonably be expected to have a Material Adverse
Effect;
(d) the following events, as soon as possible and in any event within 30 days
after the Borrower knows or has reason to know thereof: (i) the occurrence of
any Reportable Event with respect to any Plan, a failure to make any material
required contribution to a Plan, the creation of any Lien in favor of the PBGC
or a Plan or any withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan or (ii) the institution of proceedings or
the taking of any other action by the PBGC or the Borrower or any Commonly
Controlled Entity or any Multiemployer Plan with respect to the withdrawal from,
or the termination, Reorganization or Insolvency of, any Plan;
(e) in any event within ten days of obtaining knowledge thereof, the issuance of
any authorization by the Indiana Gaming Commission for the trustee under the
Indiana Power of Attorney to conduct the operations at the Indiana Gaming
Property; and
(f) in any event within ten days of obtaining knowledge thereof, any
development, event, or condition that, individually or in the aggregate with
other developments, events or conditions, could reasonably be expected to result
in a Material Adverse Effect.
Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower or the relevant Restricted
Subsidiary proposes to take with respect thereto.
6.8 Environmental Laws.
(a) Except as in the aggregate could not reasonably be expected to result in a
Material Adverse Effect, comply in all material respects with, and ensure
compliance in all material respects by all tenants and subtenants, if any, with,
all applicable Environmental Laws, and obtain and comply in all material
respects with and maintain, and ensure that all tenants and subtenants obtain
and comply in all material respects with and maintain, any and all licenses,
approvals, notifications, registrations or permits required by applicable
Environmental Laws.
(b) Except as in the aggregate could not reasonably be expected to result in a
Material Adverse Effect, conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly

 

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comply in all material respects with all lawful orders and directives of all
Governmental Authorities regarding Environmental Laws.
6.9 Control Agreements. Not later than 30 days after delivery of a written
request from either the Administrative Agent or the Arrangers (which request can
only be delivered if an Event of Default has occurred and is continuing), enter
into a control agreement, in form and substance reasonably satisfactory to the
Arrangers and the Administrative Agent, with respect to each Deposit Account (as
defined in the UCC) and each Securities Account (as defined in the UCC) of the
Borrower and the Restricted Subsidiaries, each such control agreement to be
among the Administrative Agent, the Borrower or Restricted Subsidiary that is
the holder of the applicable Deposit Account or Securities Account and the
financial institution at which such Deposit Account or Securities Account is
maintained
6.10 Additional Collateral, etc.
(a) With respect to any Property that is of the type that would otherwise be
subject to Liens created under the Security Documents and is acquired after the
Effective Date by any Loan Party (other than (w) any Property described in
paragraph (b) or paragraph (c) of this Section; (x) any Property, the pledge of
which requires a consent of a third party that has not been obtained; provided
that the Borrower and/or the applicable Loan Party has taken commercially
reasonable efforts to obtain such consent; (y) any Property subject to a Lien
expressly permitted by Section 7.3(g), (h) and (s); and (z) any interest in any
real property) and subject to compliance with applicable Gaming Laws (which the
Borrower agrees and agrees to cause the applicable Loan Party to pursue
approvals to permit any such pledges) as to which the Administrative Agent, for
the benefit of the Secured Parties, does not have a perfected Lien, promptly
(i) execute and deliver to the Administrative Agent such amendments to the
Security Documents or such other documents as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Secured Parties, a security interest in such Property and (ii) take all
actions necessary or advisable to grant to the Administrative Agent, for the
benefit of the Secured Parties, a perfected first priority security interest in
such Property (subject only to Liens permitted pursuant to Section 7.3 of this
Agreement), including without limitation, the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Security
Documents or by law or as may be requested by the Administrative Agent;
provided, if the Borrower gives notice that a Property acquired after the
Effective Date will be used for the Condo Component, the Borrower will have
thirty (30) days to execute and deliver to the Administrative Agent such
amendments to the Security Documents or such other documents as the
Administrative Agent deems necessary or advisable to grant to the Administrative
Agent, for the benefit of the Secured Parties, a security interest in such
Property and if such Property is transferred in a transaction permitted pursuant
to Section 7.7(n), no such security interest shall be required.
(b) With respect to (x) any fee interest in any real property having a value
(together with improvements thereof) of at least $1,500,000 and (y) any
leasehold interest in any real property pursuant to leases entered into by any
Loan Party, as a tenant, with gross annual rent payments for each lease in
excess of $250,000 or the term in excess of three (3) years), in each case
acquired or entered into after the Effective Date by the Loan Parties (other
than (w) any leasehold interests with respect to solely office space; (x) any
leasehold interest if the

 

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granting of a mortgage requires a consent of a third party that has not been
obtained; provided that the Borrower and/or the applicable Loan Party has taken
commercially reasonable efforts to obtain such consent; (y) any leasehold
interest if a memorandum of lease for such leasehold has not been recorded;
provided that the Borrower and/or the applicable Loan Party has taken
commercially reasonable efforts to obtain such memorandum of lease; and (z) any
such real property subject to a Lien expressly permitted by Section 7.3(g) and
Section 7.3(h)), promptly (i) execute and deliver a first priority Mortgage in
favor of the Administrative Agent, for the benefit of the Secured Parties,
covering such real property (subject only to Liens permitted pursuant to
Section 7.3 of this Agreement), (ii) if requested by the Administrative Agent in
writing, provide the Lenders with (x) title and extended coverage insurance
covering such real property in an amount at least equal to the purchase price of
such real property (or such other amount as shall be reasonably specified by the
Administrative Agent) as well as a current ALTA survey thereof, together with a
surveyor’s certificate and (y) any consents or estoppels reasonably deemed
necessary or advisable by the Administrative Agent in connection with such
Mortgage, each of the foregoing in form and substance reasonably satisfactory to
the Administrative Agent and (iii) if reasonably requested by the Administrative
Agent, deliver to the Administrative Agent legal opinions relating to the
matters opined on with respect to the original version of loan documents
delivered by the Borrower, which opinions shall be in form and substance and
from counsel, reasonably satisfactory to the Administrative Agent; provided, if
the Borrower gives notice that a Property acquired after the Effective Date will
be used for the Condo Component, the Borrower will have thirty (30) days to
execute and deliver to the Administrative Agent such amendments to the Security
Documents or such other documents as the Administrative Agent deems necessary or
advisable to grant to the Administrative Agent, for the benefit of the Secured
Parties, a security interest in such Property and if such Property is
transferred in a transaction permitted pursuant to Section 7.7(n), no such
security interest shall be required. For purposes of this Section 6.10(b), the
Sugarcane Bay Lease shall not be deemed to have been acquired or entered into
until the earlier of (A) the date 180 days after the Effective Date and (B) the
date that the Borrower and the applicable Restricted Subsidiary entered into an
amended lease that is intended by the parties to be the permanent lease with
respect to the property subject to the Sugarcane Bay Lease.
(c) With respect to any new Domestic Restricted Subsidiary (other than an
Immaterial Subsidiary) created or acquired after the Effective Date and, to the
extent that it would not result in an adverse tax, foreign gaming or foreign law
consequence that is material for or with respect to such Subsidiary, any new
Foreign Restricted Subsidiary created or acquired after the Effective Date
(which in each case, for the purposes of this paragraph, shall include any
existing Subsidiary that ceases to be an Unrestricted Subsidiary by designation
or otherwise) and subject to compliance with applicable Gaming Laws (which the
Borrower agrees and agrees to cause the applicable Loan Party to pursue
approvals to permit any such security interests), by any Loan Party, promptly
(i) execute and deliver to the Administrative Agent such amendments to the
Security Documents as the Administrative Agent deems necessary or advisable to
grant to the Administrative Agent, for the benefit of the Secured Parties, a
perfected first priority security interest in the Capital Stock of such new
Domestic Restricted Subsidiary (subject only to Liens permitted pursuant to
Section 7.3 of this Agreement) and in the 66% of the total outstanding Capital
Stock of such new Foreign Restricted Subsidiary, (ii) deliver to the
Administrative Agent the certificates representing such Capital Stock that are
securities under Section 8-102(a)(15) of the UCC, together with undated stock
powers or assignments, in blank, executed and delivered

 

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by a duly authorized officer of the Borrower or such Subsidiary, as the case may
be, (iii) cause such new Subsidiary (A) to become a party to the Loan Documents
and (B) to take such actions necessary or advisable to grant to the
Administrative Agent for the benefit of the Secured Parties a perfected first
priority security interest in the Collateral described in the Security Documents
with respect to such new Subsidiary (subject only to Liens permitted pursuant to
Section 7.3 of this Agreement), including, without limitation, the filing of
Uniform Commercial Code financing statements in such jurisdictions as may be
required by the Security Documents or by law or as may be requested by the
Administrative Agent, and (iv) if reasonably requested by the Administrative
Agent, deliver to the Administrative Agent legal opinions relating to the
matters opined on with respect to the original version of loan documents
delivered by the Borrower, which opinions shall be in form and substance, and
from counsel, reasonably satisfactory to the Administrative Agent.
(d) With respect to any new Unrestricted Subsidiary (other than (x) the Foreign
Unrestricted Subsidiaries and (y) to the extent actions described herein are
prohibited by the terms of the formation or organizational documents of an
Unrestricted Subsidiary or agreements by which such Unrestricted Subsidiary or
its assets are bound, the Unrestricted Subsidiaries created or acquired for
purposes of the transactions permitted under Section 7.7(l), (n) and (s))
created or acquired after the Effective Date by the Borrower or any of its
Restricted Subsidiaries, and subject to compliance with applicable Gaming Laws
(which the Borrower agrees and agrees to cause the applicable Unrestricted
Subsidiary to pursue approvals to permit any such pledges), promptly (i) execute
and deliver to the Administrative Agent such amendments to the Loan Documents or
such other documents as the Administrative Agent deems necessary or advisable in
order to grant to the Administrative Agent, for the benefit of the Secured
Parties, a perfected first priority security interest in the Capital Stock of
such new Domestic Unrestricted Subsidiary, (ii) deliver to the Administrative
Agent the certificates representing such Capital Stock that are securities under
Section 8-102(a)(15) of the UCC, together with undated stock powers or
assignments, in blank, executed and delivered by a duly authorized officer of
the Borrower or such Subsidiary, as the case may be, and take such other action
as may be necessary or, in the opinion of the Administrative Agent, desirable to
perfect the Lien of the Administrative Agent thereon, and (iii) if reasonably
requested by the Administrative Agent, deliver to the Administrative Agent legal
opinions relating to the matters opined on with respect to the original version
of loan documents delivered by the Borrower, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
(e) With respect to any material third party agreements or material entitlements
that do not attach to the real property entered into or received by the Borrower
or any of its Restricted Subsidiaries in connection with the construction of the
Unfinished Projects, use best efforts to promptly execute and deliver to the
Administrative Agent such collateral assignment of the applicable third party
agreement or entitlement in a form as is reasonably acceptable to the
Administrative Agent.

 

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6.11 Post-Closing Filings with Gaming Boards.
(a) Promptly after the Effective Date, make filings with the Gaming Boards of
all relevant jurisdictions in respect of the transactions contemplated by the
Loan Documents to the extent that such filings are required by applicable Gaming
Laws.
(b) Not later than 75 days after the Effective Date, the Borrower shall execute
and deliver, and cause the applicable Restricted Subsidiary, to execute and
deliver each of the Post-Closing Gaming Pledge Agreement Amendments.
6.12 Further Assurances. From time to time execute and deliver, or cause to be
executed and delivered, such additional instruments, certificates or documents,
and take such actions, as the Administrative Agent may reasonably request for
the purposes of implementing or effectuating the provisions of this Agreement
and the other Loan Documents, or of more fully perfecting or renewing the rights
of the Administrative Agent and the Lenders with respect to the Collateral (or
with respect to any additions thereto or replacements or proceeds thereof or
with respect to any other property or assets hereafter acquired by the Borrower
or any Restricted Subsidiary which may be deemed to be part of the Collateral)
pursuant hereto or thereto. Upon the exercise by the Administrative Agent or any
Lender of any power, right, privilege or remedy pursuant to this Agreement or
the other Loan Documents which requires any consent, approval, recording,
qualification or authorization of any Governmental Authority, the Borrower will
execute and deliver, or will cause the execution and delivery of, all
applications, certifications, instruments and other documents and papers that
the Administrative Agent or such Lender may be required to obtain from the
Borrower or any of its Restricted Subsidiaries for such governmental consent,
approval, recording, qualification or authorization.
6.13 In Balance Test. After delivery of all items required pursuant to Section
7.20 (other than clause (e) thereof) for any Project, and on the date selected
by the Borrower, the Borrower shall deliver to the Administrative Agent:
(a) the In-Balance Projections prepared for the In-Balance Test for such
Project, which shall be accompanied by a certificate of a Responsible Officer
stating that such In-Balance Projections are based on reasonable estimates,
information and assumptions and that such Responsible Officer has no reason to
believe that such In-Balance Projections are incorrect or misleading in any
material respect;
(b) an In-Balance Test Certificate, with such supporting detail for the
calculations set forth in such In-Balance Test Certificate as the Administrative
Agent or the Construction Consultant shall reasonably request; and
(c) such other information as the Administrative Agent or the Construction
Consultant shall reasonably request in connection with the In-Balance Test.
The applicable Project shall satisfy the In-Balance Test if, as of such date,
the Project Sources exceed the Project Uses for such Project (and for all other
Unfinished Projects) for the Project Period for such Project.

 

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SECTION 7.
NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in effect,
any Letter of Credit remains outstanding or any Loan or other amount is owing to
any Lender or any Agent hereunder, the Borrower shall not, and shall not permit
any of its Restricted Subsidiaries to, directly or indirectly:
7.1 Financial Condition Covenants.
(a) Consolidated Senior Secured Debt Ratio. Permit the Consolidated Senior
Secured Debt Ratio as of the last day of any four consecutive fiscal quarter
period of the Borrower and its Restricted Subsidiaries, to be greater than 2.50
to 1.00.
(b) Consolidated Total Leverage Ratio. Permit the Consolidated Total Leverage
Ratio as of the last day of any four consecutive fiscal quarter period of the
Borrower and its Restricted Subsidiaries ending with any fiscal quarter set
forth below to exceed the ratio set forth below opposite such fiscal quarter:

          Maximum Consolidated Fiscal Quarter Ending   Total Leverage Ratio
March 31, 2010
  7.60 to 1.00
June 30, 2010
  7.60 to 1.00
September 30, 2010
  7.60 to 1.00
December 31, 2010
  7.60 to 1.00
March 31, 2011
  7.50 to 1.00
June 30, 2011
  7.50 to 1.00
September 30, 2011
  7.25 to 1.00
December 31, 2011
  7.25 to 1.00
March 31, 2012
  7.00 to 1.00
June 30, 2012
  6.75 to 1.00
September 30, 2012
  6.25 to 1.00
December 31, 2012
  6.00 to 1.00
March 31, 2013
  5.75 to 1.00
June 30, 2013
  5.25 to 1.00
September 30, 2013
  5.00 to 1.00
December 31, 2013
  4.75 to 1.00
March 31, 2014
  4.75 to 1.00

 

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(c) Minimum Consolidated Interest Coverage Ratio. Permit the Consolidated
Interest Coverage Ratio for any period of four consecutive fiscal quarters of
the Borrower and its Restricted Subsidiaries ending with any fiscal quarter set
forth below to be less than the ratio set forth below opposite such fiscal
quarter:

          Minimum Consolidated Fiscal Quarter Ending   Interest Coverage Ratio
March 31, 2010
  1.50 to 1.00
June 30, 2010
  1.50 to 1.00
September 30, 2010
  1.50 to 1.00
December 31, 2010
  1.50 to 1.00
March 31, 2011
  1.50 to 1.00
June 30, 2011
  1.50 to 1.00
September 30, 2011
  1.50 to 1.00
December 31, 2011
  1.50 to 1.00
March 31, 2012
  1.50 to 1.00
June 30, 2012
  1.60 to 1.00
September 30, 2012
  1.65 to 1.00
December 31, 2012
  1.75 to 1.00
March 31, 2013
  1.75 to 1.00
June 30, 2013
  1.90 to 1.00
September 30, 2013
  2.00 to 1.00
December 31, 2013
  2.00 to 1.00
March 31, 2014
  2.00 to 1.00

7.2 Limitation on Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness of any Loan Party pursuant to any Loan Document;
(b) Indebtedness of (i) the Borrower to any Subsidiary, (ii) any Wholly Owned
Subsidiary Guarantor to the Borrower or any other Wholly Owned Subsidiary
Guarantor, and (iii) any Restricted Subsidiary that is not a Wholly Owned
Subsidiary Guarantor to any other Restricted Subsidiary that is not a Wholly
Owned Subsidiary Guarantor; provided any such Indebtedness is unsecured and
subordinated to the Obligations in a manner satisfactory to the Administrative
Agent;

 

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(c) (i) Indebtedness (including, without limitation, Capital Lease Obligations)
secured by Liens permitted by Section 7.3(g) and (ii) Indebtedness of any Person
that becomes a direct or indirect Subsidiary of the Borrower after the Effective
Date in an acquisition, provided such Indebtedness existed prior to the time
such Person becomes a Subsidiary and neither the Borrower nor any other Loan
Party (other than the newly acquired Subsidiary) is liable for such
Indebtedness; provided that the aggregate principal amount of Indebtedness
permitted pursuant to this Section 7.2(c) shall not exceed $50,000,000 at any
time outstanding;
(d) Indebtedness outstanding on the date hereof and listed on Schedule 7.2(d);
(e) Guarantee Obligations made by Borrower or any of its Restricted Subsidiaries
of obligations incurred in connection with activities not inconsistent with
Section 7.14 of the Borrower or any Restricted Subsidiary;
(f) (i) Indebtedness of the Borrower in respect of the Existing Subordinated
Obligations and (ii) Guarantee Obligations of any Subsidiary Guarantor in
respect of such Indebtedness; provided that such Guarantee Obligations are
subordinated to the obligations of such Subsidiary Guarantor under the Security
Documents to the same extent as the obligations of the Borrower in respect of
the Existing Subordinated Obligations are subordinated to the Obligations;
(g) New Subordinated Obligations (and Guarantee Obligations of any Subsidiary
Guarantor in respect of such Indebtedness), provided, that after giving effect
to the incurrence of such Indebtedness and the application of the proceeds
thereof on the date of such incurrence (treating (x) any Indebtedness paid or
prepaid with such proceeds as being paid or prepaid on the date of such
incurrence if an irrevocable notice of payment or prepayment is given on the
date of such incurrence and such payment or prepayment occurs on or prior to
five (5) Business Days after such incurrence and (y) any net proceeds not
applied to pay indebtedness as an increase in Cash of the Person holding such
Cash), the Consolidated Total Leverage Ratio (calculated pro forma as if such
incurrence and application (including any increase in Cash) has occurred as of
the last day of the most recent fiscal quarter for which financial statements
have been delivered or required to be delivered pursuant to Section 6.1(a) or
Section 6.1(b)) shall not be higher than 0.25 less than the level required for
such fiscal quarter pursuant to Section 7.1(a);
(h) New Subordinated Obligations and/or Permitted Refinancing Subordinated
Obligations (and Guarantee Obligations of any Subsidiary Guarantor in respect of
such Indebtedness), all of the Net Cash Proceeds of which are used to refinance
(including pursuant to a tender, redemption, exchange or other replacement)
Incremental Term Loans, Incremental Delayed Draw Term Loans, Revolving Credit
Loans, Subordinated Obligations, Permitted Senior Unsecured Obligations or
Permitted Refinancing Subordinated Obligations (and all interest and expenses
incurred in connection therewith);
(i) to the extent not available from the Lenders, (x) Guarantee Obligations with
respect to commercial letters of credit up to an aggregate amount not to exceed
$25,000,000 at any one time outstanding so long as (i) such Indebtedness is
incurred in the ordinary course of business and (ii) such Indebtedness is
incurred for the purpose of effecting payment for goods or services required by
the Borrower or any of its Restricted Subsidiaries, and (y) Guarantee

 

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Obligations with respect to standby letters of credit up to an aggregate amount
of $4,500,000 at any time one outstanding;
(j) Deferred compensation payable to employees, officers and/or directors under
the Deferred Compensation Plan;
(k) any Indebtedness incurred in accordance with Section 2.8;
(l) Indebtedness incurred pursuant to Section 4.21.3 of the Redevelopment
Agreement in an aggregate principal amount not to exceed $10,000,000 at any one
time outstanding;
(m) Indebtedness incurred in connection with the purchase, equipping, furnishing
and/or refurbishing of one or more aircraft in an aggregate principal amount not
to exceed $20,000,000 at any one time outstanding;
(n) (i) Indebtedness of the Borrower in respect of the Existing Senior Unsecured
Obligations and Permitted Senior Unsecured Obligations and (ii) Guarantee
Obligations of any Subsidiary Guarantor in respect of such Indebtedness;
provided that (x) after giving effect to the incurrence of such Indebtedness and
the application of the proceeds thereof on the date of such incurrence (treating
(A) any Indebtedness paid or prepaid with such proceeds as being paid or prepaid
on the date of such incurrence if an irrevocable notice of payment or prepayment
is given on the date of such incurrence and such payment or prepayment occurs on
or prior to five (5) Business Days after such incurrence and (B) any net
proceeds not applied to pay indebtedness as an increase in Cash of the Person
holding such Cash), the Consolidated Total Leverage Ratio (calculated pro forma
as if such incurrence and application (including any increase in Cash) has
occurred as of the last day of the most recent fiscal quarter for which
financial statements have been delivered or required to be delivered pursuant to
Section 6.1(a) or Section 6.1(b)) shall not be higher than 0.25 less than the
level required for such fiscal quarter pursuant to Section 7.1(a); and
(y) unless the Consolidated Total Leverage Ratio (calculated pro forma as if
such incurrence and application (including any increase in Cash) has occurred as
of the last day of the most recent fiscal quarter for which financial statements
have been delivered or required to be delivered pursuant to Section 6.1(a) or
Section 6.1(b)) is less than 6.00 to 1.00, the aggregate principal amount of
Indebtedness under this clause (n) shall not exceed $900,000,000;
(o) Indebtedness to the applicable franchisor or manager for funds advanced on
behalf of, or obligations owed by, the Borrower or any Restricted Subsidiary
pursuant to any Hotel Agreements; and
(p) Indebtedness respecting obligations of the Borrower or any Restricted
Subsidiary to reimburse a Person who is not an Affiliate for amounts paid for
options on land that such Person will be transferred to the Borrower or one of
its Restricted Subsidiaries for development; provided that the aggregate
principal amount of Indebtedness outstanding under this clause (p) shall not
exceed $5,000,000 at any time; and
(q) Indebtedness of the Borrower or any Subsidiary of the Borrower owed for
property, casualty or liability insurance, so long as (i) such Indebtedness
shall be incurred only to

 

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defer the cost of such insurance for the year in which such Indebtedness is
incurred and (ii) the aggregate principal amount of Indebtedness outstanding
under this clause (q) shall not exceed $10,000,000 at any time.
7.3 Limitation on Liens. Create, incur, assume or suffer to exist any Lien upon
any of its Property, whether now owned or hereafter acquired, except for:
(a) Liens for taxes, assessments and other similar governmental charges not yet
due or which are being contested in good faith by appropriate proceedings,
provided that adequate reserves with respect thereto are maintained on the books
of the Borrower or its Restricted Subsidiaries, as the case may be, in
conformity with GAAP;
(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other
like Liens arising in the ordinary course of business or in connection with the
projects which are not overdue for a period of more than 30 days or that are
being contested in good faith by appropriate proceedings;
(c) pledges or deposits in connection with workers’ compensation, unemployment
insurance and other social security legislation;
(d) deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory or regulatory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business;
(e) easements, rights-of-way, encroachment, title defects, restrictions and
other similar encumbrances created or suffered in the ordinary course of
business or incurred in permitted real estate development activities (including,
without limitation in connection with obtaining the necessary approvals to
develop any Unfinished Project);
(f) Liens in existence on the date hereof listed on Schedule 7.3(f);
(g) Liens securing Indebtedness of the Borrower or any other Restricted
Subsidiary incurred pursuant to Section 7.2(c)(i) to finance the acquisition of
fixed or capital assets, provided that (i) such Liens shall be created
substantially simultaneously with the acquisition of such fixed or capital
assets, (ii) such Liens do not at any time encumber any Property other than the
Property financed by such Indebtedness, (iii) the amount of Indebtedness secured
thereby is not increased; and (iv) the amount of Indebtedness initially secured
thereby is not less than 75%, or more than 100% of the purchase price of such
fixed or capital asset;
(h) any Lien to secure Indebtedness permitted pursuant to Section 7.2(c)(ii);
provided that (i) such Lien is on Property of a Person existing at the time such
Person becomes a Subsidiary or is merged into or consolidated with the Borrower
or any Restricted Subsidiary; (ii) such Lien was not created in contemplation of
the acquisition of, merger or consolidation with or investment in such Person
and (iii) such Lien does not extend to any assets other than those of the Person
subject to such acquisition, merger, consolidation or investment;
(i) Liens created pursuant to the Security Documents;

 

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(j) any lease affecting Property owned by the Borrower or any other Subsidiary
entered into, assumed or otherwise acquired in the ordinary course of its
business and covering only the assets so leased;
(k) Liens on Cash deposited to secure reimbursement obligations under commercial
letters of credit permitted under Section 7.2(i), so long as the amount of Cash
subject to any such Lien does not exceed 110% of the amount of the Indebtedness
secured thereby;
(l) Intellectual Property rights granted by the Borrower or a Restricted
Subsidiary not interfering in any material respect with the ordinary conduct of
the business of the Borrower or the Restricted Subsidiaries, taken as a whole;
(m) any attachment or judgment Lien not constituting an event of default under
Section 8(h);
(n) Liens arising from the filing of UCC financing statements relating solely to
leases permitted by this Agreement;
(o) 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;
(p) any zoning or similar law or right reserved to or vested in any Governmental
Authority to control or regulate the use of any real property which does not
materially interfere with the ordinary conduct of the business of the Borrower
and its Restricted Subsidiaries, taken as a whole;
(q) Liens reflected as exceptions on the title policies issued to the
Administrative Agent on the Effective Date as contemplated under
Section 5.1(r)(ii), or in connection with Property acquired or mortgaged after
the Effective Date, on title policies issued pursuant to Section 6.10;
(r) any Lien on the Property for the Lumière Property Project securing
Indebtedness permitted pursuant to Section 7.2(l) not to exceed a principal
amount of $10,000,000 and interest on such principal amount;
(s) Liens securing Indebtedness of the Borrower or any other Restricted
Subsidiary incurred pursuant to Section 7.2(m), provided that (i) such Liens do
not at any time encumber any Property other than the Property financed or
refinanced by such Indebtedness, and (ii) the amount of Indebtedness initially
secured thereby is not more than 100% of fair market value of such fixed or
capital asset;
(t) Earnest money or other deposits in Cash or Cash Equivalents for transactions
permitted under this Agreement;
(u) Liens not otherwise permitted by this Section 7.3 so long as (i) such Liens
do not secure funded Indebtedness, and (ii) the aggregate outstanding amount of
the obligations secured thereby does not exceed $10,000,000 at any one time
outstanding;

 

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(v) Liens created pursuant to any Back-Stop Arrangement;
(w) Lien securing Indebtedness permitted pursuant to Section 7.2(o) or other
obligations owed to the applicable franchisor or manager pursuant to any Hotel
Agreements;
(x) Liens on incurred premiums, dividends and rebates which may become payable
under insurance policies and loss payments which reduce the incurred premiums on
such insurance policies securing financing of the premiums with respect thereto
to the extent such Indebtedness is permitted to be incurred pursuant to
Section 7.2(q); and
(y) Any preferential arrangement in favor of the trustee under the Indiana Power
of Attorney created by the execution and delivery of the Indiana Power of
Attorney; provided, however, that the Indiana Power of Attorney may not create
any other Lien or otherwise constitute or result in a Default or Event of
Default.
7.4 Limitation on Fundamental Changes. Enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or Dispose of all or substantially all of its
Property or business, except that:
(a) any Person may be merged, consolidated or amalgamated with or into the
Borrower (provided that the Borrower shall be the continuing or surviving entity
and the Borrower shall comply with Section 6.12 in connection therewith) or with
or into any Subsidiary Guarantor (provided that (i) the Subsidiary Guarantor
shall be the continuing or surviving entity or (ii) simultaneously with such
transaction, the continuing or surviving entity shall become a Subsidiary
Guarantor and the Borrower shall comply with Section 6.10 and Section 6.12 in
connection therewith) and any Immaterial Subsidiary may be merged, consolidated
or amalgamated with or into any Immaterial Subsidiary;
(b) any Restricted Subsidiary of the Borrower may liquidate, wind up, dissolve
or cease to exist or may Dispose of any or all of its assets to the Borrower or
any Restricted Subsidiary;
(c) a conversion of any Restricted Subsidiary to another form of organization
when no Default or Event of Default exists or would result therefrom; provided
that the Borrower and such Restricted Subsidiary execute any assumption
documents reasonably requested by the Administrative Agent to continue the
perfection of Liens granted pursuant to the Loan Documents and to continue all
other obligations under the Loan Documents to which such Restricted Subsidiary
was a party; and
(d) any Immaterial Subsidiary may be liquidated or dissolved or otherwise cease
to exist.
7.5 Limitation on Disposition of Property. Dispose of any of its Property
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, or, in the case of any Restricted Subsidiary,
issue or sell any shares of such Restricted Subsidiary’s Capital Stock to any
Person, except:

 

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(a) the Disposition of personal property that is no longer used or useful in the
ordinary course of business;
(b) the Disposition of Cash or Cash Equivalents and the sale of inventory in the
ordinary course of business;
(c) Dispositions permitted by Section 7.4;
(d) Dispositions by the Borrower or a Restricted Subsidiary to the Borrower or
another Restricted Subsidiary;
(e) Dispositions of any Investment in an Unrestricted Subsidiary;
(f) the sale or issuance of any Subsidiary’s Capital Stock to the Borrower or
any Subsidiary Guarantor and the sale or issuance of any Immaterial Subsidiary’s
Capital Stock to any Immaterial Subsidiary;
(g) any Designated Asset Sale, provided that a Fair Value Determination has been
made with respect to such Disposition;
(h) Dispositions of Property, not otherwise permitted under this Section 7.5, in
any one transaction or series of related transactions having a value not in
excess of $10,000,000, and having an aggregate value not in excess of
$20,000,000 in any fiscal year and not in excess of $50,000,000 during the term
of this Agreement;
(i) Dispositions by the Borrower or any Restricted Subsidiary of its interest in
the Argentina Subsidiaries;
(j) any Recovery Event, provided, that the requirements of Section 2.13(c) are
complied with in connection therewith;
(k) any Disposition of any Investment permitted pursuant to Section 7.7(k);
(l) any Disposition constituting any lease otherwise permitted under
Section 7.3(j);
(m) any Disposition of Intellectual Property otherwise permitted under
Section 7.3(l);
(n) any Disposition of all or any portion of the Property comprising the Condo
Component, provided that a Fair Value Determination has been made with respect
to such Disposition;
(o) dedications of rights of way, easements or other development concessions
made by Borrower or its Restricted Subsidiaries as necessary, otherwise
desirable, or as may be required in connection with obtaining the necessary
approvals to develop, or as otherwise may be desirable to improve or remodel any
Property;

 

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(p) any Disposition of one or more aircraft;
(q) any Disposition of all or any portion of the Undeveloped Reno Land; and
(r) any Disposition of all or any portion of the STAR and TIF Bonds.
7.6 Limitation on Restricted Payments. Declare or pay any dividend on, or make
any payment on account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or other acquisition
of, any Capital Stock of the Borrower or any Restricted Subsidiary, whether now
or hereafter outstanding, or make any other distribution in respect thereof,
either directly or indirectly, whether in Cash or property or in obligations of
the Borrower or any Restricted Subsidiary, or enter into any derivatives or
other transaction with any financial institution, commodities or stock exchange
or clearinghouse (a “Derivatives Counterparty”) obligating the Borrower or any
Restricted Subsidiary to make payments to such Derivatives Counterparty as a
result of any change in market value of any such Capital Stock (collectively,
“Restricted Payments”), except that:
(a) (i) any Subsidiary may make Restricted Payments to the Borrower or any
Wholly Owned Subsidiary Guarantor or (ii) any Restricted Subsidiary that is not
a Wholly Owned Subsidiary Guarantor may make Restricted Payments to another
Restricted Subsidiary that is not a Wholly Owned Subsidiary Guarantor;
(b) the Borrower may make Restricted Payments in the form of common stock of the
Borrower;
(c) the Borrower may repurchase or redeem Capital Stock of the Borrower to the
extent required by any Gaming Board to prevent a License Revocation;
(d) the Borrower may purchase the Borrower’s common stock or common stock
options from present or former officers or employees of the Borrower or any
Subsidiary following the death, disability or termination of employment of such
officer or employee, provided, that the aggregate amount of payments under this
paragraph subsequent to the Effective Date (net of any proceeds received by the
Borrower during the corresponding period following the Effective Date in
connection with resales of any common stock or common stock options so
purchased) shall not exceed $1,000,000 per fiscal year; and
(e) the Borrower may make Restricted Payments consisting Investments in
Unrestricted Subsidiaries permitted to be Disposed of pursuant to
Section 7.5(e).
7.7 Limitation on Investments. Make any advance, loan, extension of credit (by
way of guaranty or otherwise) or capital contribution to, or purchase any
Capital Stock, bonds, notes, debentures or other debt securities of, or any
assets constituting an ongoing business from, or make any other investment in,
any other Person (all of the foregoing, “Investments”), except:
(a) extensions of trade credit in the ordinary course of business (including,
without limitation, advances to patrons of the casino operations of the Borrower
or the Restricted Subsidiaries consistent with ordinary course gaming
operations);

 

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(b) Investments in Cash Equivalents;
(c) Investments arising in connection with the incurrence of Indebtedness
permitted by Section 7.2(b) and Section 7.2(e);
(d) Investments in existence on the date hereof listed on Schedule 7.7(d);
(e) loans and advances to employees of the Borrower or any Restricted
Subsidiaries of the Borrower in the ordinary course of business (including,
without limitation, for travel, entertainment and relocation expenses) in an
aggregate amount for the Borrower and Restricted Subsidiaries of the Borrower
not to exceed $5,000,000 at any one time outstanding;
(f) Investments consisting of the extension of credit to customers and suppliers
of the Borrower and the Restricted Subsidiaries in the ordinary course of
business and Investments received in satisfaction or partial satisfaction
thereof;
(g) Investments received in connection with the settlement of any bona fide
dispute with another Person or in satisfaction of judgments;
(h) Investments in assets not prohibited by Section 7.14 made by the Borrower or
any of its Restricted Subsidiaries with the proceeds of any Reinvestment
Deferred Amount; provided that any such Investments made with Net Cash Proceeds
of any Recovery Event with respect to Hurricane Katrina and/or Hurricane Rita
shall be made solely in assets located in the United States and owned by the
Borrower or a Domestic Restricted Subsidiary;
(i) Investments by the Borrower or any of its Restricted Subsidiaries in the
Borrower or any Person that, prior to such Investment, is a Restricted
Subsidiary;
(j) Investments in the Foreign Unrestricted Subsidiaries by the Borrower or a
Restricted Subsidiary in an aggregate amount not to exceed the Maximum Foreign
Subsidiary Investment Amount;
(k) In addition to Investments otherwise expressly permitted by this
Section 7.7, Investments by the Borrower or any of its Restricted Subsidiaries
in an aggregate amount outstanding at any time (valued at cost) not exceeding
the sum of (i) $100,000,000 plus (ii) an amount (but not less than zero) equal
to the lesser of (x) 50% of the New Capital Adjusted Proceeds minus $100,000,000
and (y) the New Capital Adjusted Proceeds minus the amount thereof that has been
applied for Capital Expenditures pursuant to Section 7.16(c) minus $100,000,000;
(l) Borrower or its Restricted Subsidiaries shall be permitted to transfer all
or any portion of the Undeveloped Reno Property to an Unrestricted Subsidiary or
a joint venture of the Borrower or its Restricted Subsidiary; provided that any
equity interest received by the Borrower or its Restricted Subsidiary in
exchange therefore or in connection therewith shall be pledged as Collateral;

 

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(m) Investments made in connection with Hedge Agreements entered into by
Borrower or any of its Subsidiaries as required by Section 6.9 and to the extent
not prohibited by Section 7.15;
(n) Investments in an Unrestricted Subsidiary or a joint venture for the purpose
of development of the Condo Component in an amount not to exceed $10,000,000 at
any one time outstanding;
(o) (i) Investments by the Borrower or any of its Restricted Subsidiaries in any
Person that concurrently with such Investment becomes a Restricted Subsidiary or
that is merged into or consolidated with Borrower or a Restricted Subsidiary
pursuant to Section 7.4(a), or (ii) the acquisition of any assets (including by
merger, consolidation or otherwise) constituting an ongoing business by a
Borrower or a Restricted Subsidiary; provided that in the case of clause (i) and
(ii), (x) the Borrower and the applicable Restricted Subsidiaries, if any, shall
comply with Section 6.10 in connection therewith; and (y) with respect to all
such Investments or acquisitions, notwithstanding the treatment provided
pursuant to GAAP, the aggregate purchase price shall be treated as Capital
Expenditures and subject to the restrictions and carveouts contained in
Section 7.16;
(p) Investments made by the Borrower in any Subsidiary received in exchange
solely for common stock of the Borrower;
(q) Investments made by the Borrower in the STAR and TIF Bonds, not to exceed
$10,000,000 at any time outstanding;
(r) Investments made pursuant to the Redevelopment Agreement;
(s) Investments made pursuant to the Hotel Agreements, not to exceed $10,000,000
at any time outstanding; and
(t) Investments by the Borrower in the Atlantic City Entities; provided that
(i) such Investments shall not exceed $12,000,000 in any calendar year and
(ii) the proceeds of such Investment are applied by the Atlantic City Entities
for maintenance support of the Atlantic City Property, including, application to
property taxes, lease payments, demolition costs and other expenses.
7.8 Limitation on Optional Payments and Modifications of Debt Instruments, etc.
(a) Make or offer to make any optional or voluntary payment, prepayment,
repurchase or redemption of, or otherwise voluntarily or optionally defease, the
principal of Subordinated Notes, the Permitted Refinancing Subordinated Notes or
Permitted Senior Unsecured Obligations, or segregate funds for any such payment,
prepayment, repurchase, redemption or defeasance, or enter into any derivative
or other transaction with any Derivatives Counterparty obligating the Borrower
or any Subsidiary to make payments to such Derivatives Counterparty as a result
of any change in market value of the Subordinated Notes, the Permitted
Refinancing Subordinated Notes or Permitted Senior Unsecured Obligations,
provided that:

 

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(i) the Borrower may prepay Existing Subordinated Obligations, New Subordinated
Obligations, Permitted Refinancing Subordinated Obligations and Permitted Senior
Unsecured Obligations in connection with the refinancing of such Existing
Subordinated Obligations, New Subordinated Obligations, Permitted Refinancing
Subordinated Obligations or Permitted Senior Unsecured Obligations with the
proceeds of (1) New Subordinated Obligations and/or Permitted Refinancing
Subordinated Obligations permitted pursuant to Section 7.2(h), or (2) Permitted
Senior Unsecured Obligations permitted pursuant to Section 7.2(n);
(ii) if there is no Default or Event of Default (giving effect to such
transaction), the Borrower may make any optional or voluntary payment,
prepayment, repurchase or redemption of, or otherwise voluntarily or optionally
defease the Borrower’s Indebtedness under the Subordinated Notes and/or the
Senior Unsecured Notes in an aggregate amount not to exceed $100,000,000 after
January 1, 2010;
(b) amend, modify or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to, any of the terms of the Subordinated
Notes or the Permitted Refinancing Subordinated Notes or the Permitted Senior
Unsecured Notes, other than:
(i) any such amendment, modification, waiver or other change which would extend
the maturity or reduce the amount of any payment of principal thereof, reduce
the rate or extend the date for payment of interest thereon, or such amendments,
modifications, waivers or other changes that do not in the aggregate render such
instruments more restrictive than they were prior thereto;
(ii) to conform the Senior Subordinated Notes Indenture 2003 to the Senior
Subordinated Notes Indenture 2004; or
(iii) any other revisions, amendments, waivers or modifications that are
determined by the Administrative Agent not to be adverse to the Lenders;
(c) designate any Indebtedness (other than the Obligations) as “Designated
Senior Indebtedness” for the purposes of the Senior Subordinated Indentures; or
(d) amend the Borrower’s certificate of incorporation in any manner determined
by the Administrative Agent to be adverse to the Lenders.
7.9 Limitation on Transactions with Affiliates. Enter into any transaction,
including, without limitation, any purchase, sale, lease or exchange of
Property, the rendering of any service or the payment of any management,
advisory or similar fees, with any Affiliate (other than (x) transactions
between or among the Borrower or any Restricted Subsidiary, (y) indemnification
agreements, arrangements or provisions between the Borrower or any of its
Subsidiaries and the officers, directors or any other employee of Borrower or
any of its Subsidiaries and (z) the allocation, or lack thereof, of common
expenses (including, without limitation, insurance premiums and overhead
expenses) that the Borrower has determined in its business judgment should be
paid collectively) unless such transaction is (a) not prohibited under this
Agreement and (b) upon fair and reasonable terms no less favorable to the
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Subsidiary, as the case may be, than it would obtain in a comparable arm’s
length transaction with a Person that is not an Affiliate; provided that the
provisions of this Section 7.9 shall not apply to transactions permitted
pursuant to Section 7.6, Section 7.7(e), (j), (l), (n), (p), (s) or (t), or
Section 7.18.
7.10 Limitation on Sales and Leasebacks. Except for (a) the Disposition of one
or more aircraft in a transaction permitted pursuant to Section 7.5(p), or
(b) sale and leaseback transactions that are (i) permitted pursuant to
Section 7.5(o), (ii) entered into after January 1, 2010 and (iii) do not exceed
in the aggregate Property with a value during the term of this Agreement in
excess of $10,000,000, enter into any arrangement with any Person providing for
the leasing by the Borrower or any Restricted Subsidiary of real or personal
property, which has been or is to be sold or transferred by the Borrower or such
Restricted Subsidiary to such Person or to any other Person to whom funds have
been or are to be advanced by such Person on the security of such property or
rental obligations of the Borrower or such Subsidiary.
7.11 Limitation on Changes in Fiscal Periods. Permit the fiscal year of the
Borrower to end on a day other than December 31 or change the Borrower’s method
of determining fiscal quarters.
7.12 Limitation on Negative Pledge Clauses. Enter into or suffer to exist or
become effective any agreement that prohibits or limits the ability of the
Borrower or any of its Restricted Subsidiaries to create, incur, assume or
suffer to exist any Lien upon any of its Property or revenues, whether now owned
or hereafter acquired, to secure the Obligations or, in the case of any
guarantor, its obligations under the Security Documents, other than (a) this
Agreement and the other Loan Documents, (b) the Indentures, (c) any agreements
governing any purchase money Liens or Capital Lease Obligations otherwise
permitted hereby (in which case, any prohibition or limitation shall only be
effective against the assets financed thereby), (d) customary provisions in
leases and licenses entered into in the ordinary course of business consistent
with past practices (in each case applicable solely to such lease or license or
the Property subject to such lease or license), (e) customary restrictions in an
agreement to Dispose of assets in a transaction permitted under Section 7.5
solely to the extent that such restrictions apply solely to the assets to be
Disposed, (f) in accordance with applicable Gaming Laws, (g) restrictions in any
agreement relating to the Condo Component and the Undeveloped Reno Property,
(h) the St. Louis County Ground Lease, and (i) customary restrictions contained
in agreements with respect to Indebtedness permitted pursuant to Section 7.2(c),
Section 7.2(d) and Section 7.2(m).
7.13 Limitation on Restrictions on Subsidiary Distributions. Enter into or
suffer to exist or become effective any consensual encumbrance or restriction on
the ability of any Restricted Subsidiary to (a) make Restricted Payments in
respect of any Capital Stock of such Restricted Subsidiary held by, or pay any
Indebtedness owed to, the Borrower or any other Restricted Subsidiary, (b) make
Investments in the Borrower or any other Restricted Subsidiary, or (c) transfer
any of its assets to the Borrower or any other Restricted Subsidiary, except for
such encumbrances or restrictions existing under or by reason of (i) any
restrictions existing under the Loan Documents; (ii) any restrictions with
respect to a Restricted Subsidiary imposed pursuant to an agreement that has
been entered into in connection with the Disposition of all or substantially all
of the Capital Stock or assets of such Restricted Subsidiary; (iii) customary

 

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restrictions in an agreement to Dispose of assets in a transaction permitted
under Section 7.5 solely to the extent that such restriction applies solely to
the assets to be Disposed; (iv) customary anti-assignment provisions in leases
and licenses entered into in the ordinary course of business consistent with
past practices (in each case applicable solely to such lease or license or the
Property subject to such lease or license); (v) customary restrictions on
transfers of assets contained in any agreements governing any purchase money
Liens or Capital Lease Obligations otherwise permitted hereby (in which case,
any prohibition or limitation shall only be effective against the assets
financed thereby), (vi) restrictions in any agreement relating to the Condo
Component and the Undeveloped Reno Property, and (vii) restrictions contained in
agreements with respect to Indebtedness permitted pursuant to Section 7.2(c),
Section 7.2(d) and Section 7.2(m).
7.14 Limitation on Lines of Business. Enter into any business, either directly
or through any Restricted Subsidiary, except for those businesses in which the
Borrower and its Restricted Subsidiaries are engaged on the date of this
Agreement or that are reasonably related or similar thereto except the Borrower
may (i) enter into any joint venture or financing for the Condo Component or
(ii) pursue the pre-development of all or any part of the Undeveloped Reno
Property.
7.15 Limitation on Hedge Agreements. Enter into any Hedge Agreement other than
Hedge Agreements entered into in the ordinary course of business, and not for
speculative purposes, to protect against changes in interest rates.
7.16 Limitation on Capital Expenditures. Make any Capital Expenditure after
January 1, 2010, except:
(a) Maintenance Capital Expenditures (including renovations or property
improvements that would not result in the property on which such renovations or
improvements are being made to becoming a Project) for any fiscal year during
the term of this Agreement (commencing with fiscal year 2010) not to exceed, as
of any date of determination, the amount limited to 6.00% of Consolidated
Revenues of the Borrower and its Subsidiaries for the immediately preceding
fiscal year, provided that the amount of Maintenance Capital Expenditures
permitted to be made in any fiscal year may be increased by the amount of
Maintenance Capital Expenditures not expended in the immediately preceding
fiscal year (but such increase may not be carried forward to any subsequent
fiscal year);
(b) In addition to Capital Expenditures otherwise permitted under this
Section 7.16, Capital Expenditures not in excess of $50,000,000 plus (i) for the
first quarter of fiscal year 2010, 35.0% of Annualized Adjusted EBITDA of the
Borrower and its Restricted Subsidiaries for the first quarter of fiscal year
2010; (ii) for the two-fiscal quarter period ending on June 30, 2010, 35.0% of
Annualized Adjusted EBITDA of the Borrower and its Restricted Subsidiaries for
the first two quarters of fiscal year 2010, (iii) for the three-fiscal quarter
period ending on September 30, 2010, 35.0% of Annualized Adjusted EBITDA of the
Borrower and its Restricted Subsidiaries for the first three quarters of fiscal
year 2010, (iv) for the four-fiscal quarter period ending on December 31, 2010,
35.0% of Annualized Adjusted EBITDA of the Borrower for fiscal year 2010, and
(v) for any four fiscal quarter period ending thereafter, 35.0% of Annualized
Adjusted EBITDA of the Borrower and its Restricted Subsidiaries for the most

 

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recent fiscal quarter for which financial statements are required to be
delivered under Section 6.1(a) or Section 6.1(b) (as the same may increase or
decrease from quarter to quarter); provided that if the Borrower was in
compliance with the permitted level of Capital Expenditures permitted under this
clause (b) as determined at the time any Capital Expenditure was incurred, but
became noncompliant with such permitted level as a result of subsequent
reductions in Annualized Adjusted EBITDA, such noncompliance shall not cause a
Default under this Agreement but rather shall operate to preclude any further
incurrence of Capital Expenditures until the Borrower is again in compliance
with the permitted level of Capital Expenditures permitted under this clause
(b);
(c) In addition to Capital Expenditures otherwise permitted under this
Section 7.16, Capital Expenditures in an amount not to exceed the New Capital
Adjusted Proceeds minus $100,000,000, minus the amount thereof representing
outstanding Investments made pursuant to Section 7.7(k);
(d) In addition to Capital Expenditures otherwise permitted under this
Section 7.16, Capital Expenditures in an amount not to exceed the New Capital
Asset Disposition Proceeds less any amount of such New Capital Asset Disposition
Proceeds applied or required to be applied to prepay Incremental Term Loans
and/or Revolving Credit Loans with a corresponding reduction in the Revolving
Credit Commitments or Incremental Revolving Credit Commitments;
(e) Capital Expenditures associated with the River City Property Project which
do not result in the aggregate Capital Expenditures associated with (i) Phase I
of such Project being in excess of $63,000,000, and (ii) Phase II of such
Project being in excess of $85,000,000;
(f) Capital Expenditures associated with the Sugarcane Bay Project which do not
result in the aggregate Capital Expenditures associated with such Project being
in excess of $238,000,000;
(g) Capital Expenditures associated with the Baton Rouge Project which do not
result in the aggregate Capital Expenditures associated with such Project being
in excess of $235,000,000;
(h) Capital Expenditures associated with the renovation of the PRC-MO Property
Project which do not result in the aggregate Capital Expenditures associated
with such Project being in excess of $15,000,000; and
(i) Capital Expenditures associated with the development of Phase II of the
Lumière Property Project which do not result in the aggregate Capital
Expenditures associated with such Project being in excess of $55,000,000.
7.17 Commencement of Construction. Notwithstanding anything to the contrary
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(a) if the Commencement of Construction has occurred with respect to any
Project, then until such Project has satisfied the In-Balance Test described in
Section 6.13, not make any Capital Expenditures with respect to such Project;
(b) prior to Commencement of Construction for any Project (other than the
Sugarcane Bay Project and the Baton Rouge Project), not make Capital
Expenditures for such Project in an amount in excess of the lesser of (i) 10.00%
of the Construction Budget for such Project, or (ii) $25,000,000;
(c) on an after January 1, 2010 and prior to Commencement of Construction with
respect to the Sugarcane Bay Project, not make Capital Expenditures for the
Sugarcane Bay Project in an amount in excess of $25,000,000; and
(d) on an after January 1, 2010 and prior to Commencement of Construction with
respect to the Baton Rouge Project, not make Capital Expenditures for the Baton
Rouge Project in an amount in excess of $25,000,000.
7.18 Limitation on Changes to Deferred Compensation Plan. Amend or modify the
Deferred Compensation Plan in a manner that would change its nature from that of
a “defined contribution plan,” within the meaning of Section 414(i) of the Code,
to a “defined benefit plan,” within the meaning of Section 414(j) of the Code.
7.19 Baton Rouge Project Construction Covenants. On and after January 1, 2010,
apply more than $25,000,000 of funds from any source to the Expenses for the
Baton Rouge Project until the Borrower shall have received New Capital Available
Proceeds in an amount equal to or greater than $100,000,000.
7.20 Construction Covenants. Permit Commencement of Construction to occur for
any Project unless:
(a) a Construction Consultant reasonably acceptable to the Arrangers and the
Borrower shall have been retained for such Project;
(b) the Borrower shall have delivered to the Administrative Agent and the
Construction Consultant, the Construction Budget, the Construction Plan and the
Construction Timetable for such Project and all other information with respect
to such Project reasonably requested by the Construction Consultant in order to
provide the report referred to in Section 7.20(c) below;
(c) the Construction Consultant for such Project shall have delivered to the
Administrative Agent and the Arrangers a report with a favorable opinion as to
the reasonableness of the Construction Budget, the Construction Plan and the
Construction Timetable for such Project;
(d) the Borrower shall have entered into a guaranteed maximum price contract, in
form and substance reasonably acceptable to the Administrative Agent and
Arrangers, with respect to the renovation and/or construction, as applicable, of
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(e) the In-Balance Test for such Project shall have been satisfied in accordance
with the provision of Section 6.13.
7.21 Directors’ and Officers’ Trust. Notwithstanding anything to the contrary
contained in this Agreement (including the negative covenants in this
Section 7), Borrower may deposit up to $10,000,000 into a Directors’ and
Officers’ Trust.
SECTION 8.
EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Loan or Reimbursement
Obligation when due in accordance with the terms hereof; or the Borrower shall
fail to pay any interest on any Loan or Reimbursement Obligation, or any other
amount payable hereunder or under any other Loan Document, within five days
after any such interest or other amount becomes due in accordance with the terms
hereof or thereof; or
(b) Any representation or warranty made or deemed made by any Loan Party herein
or in any other Loan Document or that is contained in any certificate, document
or financial or other statement furnished by it at any time under or in
connection with this Agreement or any such other Loan Document shall prove to
have been inaccurate in any material respect on or as of the date made or deemed
made or furnished; or
(c) Any Loan Party shall default in the observance or performance of any
agreement contained in clause (i) or (ii) of Section 6.4(a) (with respect to the
Borrower only) or Section 7; or
(d) Any Loan Party shall default in, or an event of default shall occur with
respect to, the observance or performance of any other agreement contained in
this Agreement or any other Loan Document (other than as provided in paragraphs
(a) through (c) of this Section), and such default or event of default shall
continue unremedied for a period of 30 days; or
(e) The Borrower or any of its Restricted Subsidiaries shall (i) default in
making any payment of any principal of any Indebtedness (including, without
limitation, any Guarantee Obligation, but excluding the Loans and Reimbursement
Obligations) on the scheduled or original due date with respect thereto; or
(ii) default in making any payment of any interest on any such Indebtedness
beyond the period of grace, if any, provided in the instrument or agreement
under which such Indebtedness was created; or (iii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or condition exist, the effect
of which default or other event or condition is to cause, or to permit the
holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of
such holder or beneficiary) to cause, with the giving of notice if required,
such Indebtedness to become due prior to its stated maturity or to become
subject to or mandatory offer to purchase by the obligor thereunder or (in the
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Obligation) to become payable; provided, that a default, event or condition
described in clause (i), (ii) or (iii) of this paragraph (e) shall not at any
time constitute an Event of Default unless, at such time, one or more defaults,
events or conditions of the type described in clauses (i), (ii) and (iii) of
this paragraph (e) shall have occurred and be continuing with respect to
Indebtedness the outstanding principal amount of which exceeds in the aggregate
$10,000,000; or
(f) (i) The Borrower or any of its Subsidiaries shall commence any case,
proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or
(B) seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or the
Borrower or any of its Subsidiaries shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Borrower
or any of its Subsidiaries any case, proceeding or other action of a nature
referred to in clause (i) above that (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against the Borrower or any of its Subsidiaries any case, proceeding
or other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its assets
that results in the entry of an order for any such relief that shall not have
been vacated, discharged, or stayed or bonded pending appeal within 60 days from
the entry thereof; or (iv) the Borrower or any of its Subsidiaries shall take
any action in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above;
or (v) the Borrower or any of its Subsidiaries shall generally not, or shall be
unable to, or shall admit in writing its inability to, pay its debts as they
become due; or
(g) (i) The Borrower or any Commonly Controlled Entity shall engage in any
material “prohibited transaction” (as defined in Section 406 of ERISA or
Section 4975 of the Code) involving any Plan, (ii) any failure by any Plan to
satisfy the minimum funding standard applicable to such Plan under Section 412
or 430 of the Code or Section 302 or 303 of ERISA, (iii) any “accumulated
funding deficiency” (as defined in Section 412 of the Code or Section 302 of
ERISA), whether or not waived, shall exist with respect to any Plan, (iv) any
Lien in favor of the PBGC or a Plan shall arise on the assets of the Borrower or
any Commonly Controlled Entity, (v) a Reportable Event shall occur with respect
to, or proceedings shall commence to have a trustee appointed, or a trustee
shall be appointed, to administer or to terminate, any Single Employer Plan,
which Reportable Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required Lenders, likely to result
in the termination of such Plan for purposes of Title IV of ERISA, (vi) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA other
than in a standard termination (as defined in Section 4041(b) of ERISA),
(vii) the Borrower or any Commonly Controlled Entity shall, or in the reasonable
opinion of the Required Lenders shall be likely to, incur any liability in
connection with a withdrawal from, or the Insolvency or Reorganization of, a
Multiemployer Plan or (viii) any other event or condition shall occur or exist
with respect to a Plan; and in each case in clauses (i) through (viii) above,
such event or condition, together with all other such events or conditions, if
any, could, in the sole judgment of the Required Lenders, reasonably be expected
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(h) One or more judgments or decrees shall be entered against the Borrower or
any of its Subsidiaries involving for the Borrower and its Subsidiaries taken as
a whole a liability (not paid or fully covered by insurance as to which the
relevant insurance company has acknowledged coverage) of $10,000,000 or more,
and all such judgments or decrees shall not have been vacated, discharged,
stayed or bonded pending appeal within 30 days from the entry thereof; or
(i) Any of the Security Documents shall cease, for any reason (other than by
reason of the express release thereof pursuant to Section 10.15), to be in full
force and effect, or any Loan Party or any Affiliate of any Loan Party shall so
assert, or any Lien created by any of the Security Documents shall cease to be
enforceable and of the same effect and priority purported to be created thereby;
or
(j) The guarantee contained in Subsidiary Guaranty shall cease, for any reason
(other than by reason of the express release thereof pursuant to Section 10.15),
to be in full force and effect or any Loan Party or any Affiliate of any Loan
Party shall so assert; or
(k) Any Change of Control shall occur; or
(l) The Subordinated Notes or the guarantees thereof shall cease, for any
reason, to be validly subordinated to the Obligations or the obligations of the
Subsidiary Guarantors under the Security Documents, as the case may be, as
provided in the applicable Indentures, or any Loan Party, any Affiliate of any
Loan Party, the trustee in respect of the Subordinated Notes or the holders of
at least 25% in aggregate principal amount of the Subordinated Notes shall so
assert;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including, without limitation, all
amounts of L/C Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented the documents required
thereunder) shall immediately become due and payable, and (B) if such event is
any other Event of Default, either or both of the following actions may be
taken: (i) with the consent of the Majority Revolving Credit Facility Lenders,
the Administrative Agent may, or upon the request of the Majority Revolving
Credit Facility Lenders, the Administrative Agent shall, by notice to the
Borrower declare the Revolving Credit Commitments to be terminated forthwith,
whereupon the Revolving Credit Commitments shall immediately terminate; and
(ii) with the consent of the Required Lenders, the Administrative Agent may, or
upon the request of the Required Lenders, the Administrative Agent shall, by
notice to the Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan
Documents (including, without limitation, all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have presented the documents required thereunder) to be due and payable
forthwith, whereupon the same shall immediately become due and payable. In the
case of all Letters of Credit with respect to which presentment for honor shall
not have occurred at the time of an acceleration pursuant to this paragraph, the
Borrower shall at such time deposit in a cash collateral account opened by the
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Agent an amount equal to the aggregate then undrawn and unexpired amount of such
Letters of Credit. Amounts held in such cash collateral account shall be applied
by the Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Borrower hereunder and under the other Loan Documents. After
all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations of
the Borrower hereunder and under the other Loan Documents shall have been paid
in full, the balance, if any, in such cash collateral account shall be returned
to the Borrower (or such other Person as may be lawfully entitled thereto).
SECTION 9.
THE AGENTS
9.1 Appointment. Each Lender hereby irrevocably designates and appoints the
Agents as the agents of such Lender under this Agreement and the other Loan
Documents, and each Lender irrevocably authorizes each Agent, in such capacity,
to take such action on its behalf under the provisions of this Agreement and the
other Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to such Agent by the terms of this Agreement and the other
Loan Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, no Agent shall have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against any Agent.
9.2 Delegation of Duties. Each Agent may execute any of its duties under this
Agreement and the other 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. No Agent shall be responsible for the negligence or misconduct of
any agents or attorneys-in-fact selected by it with reasonable care.
9.3 Exculpatory Provisions. Neither any Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates shall be
(i) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other Loan Document
(except to the extent that any of the foregoing are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from its or such Person’s own gross negligence or willful misconduct) or
(ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by any Loan Party or any officer
thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Agents under or in connection with, this Agreement or any
other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of any Loan Party to perform its obligations hereunder or
thereunder. The 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
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in, or conditions of, this Agreement or any other Loan Document, or to inspect
the properties, books or records of any Loan Party.
9.4 Reliance by Agents. Each Agent shall be entitled to rely, and shall be fully
protected in relying, upon any instrument, writing, resolution, notice, consent,
certificate, affidavit, letter, telecopy, telex or teletype message, statement,
order or other document or conversation 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 the Loan Parties), independent accountants and other experts selected by such
Agent. The Agents may deem and treat the payee of any Note as the owner thereof
for all purposes unless such Note shall have been transferred in accordance with
Section 10.6 and all actions required by such Section in connection with such
transfer shall have been taken. Each Agent shall be fully justified in failing
or refusing to take any action under this Agreement or any other Loan Document
unless it shall first receive such advice or concurrence of the Required Lenders
(or, if so specified by this Agreement, all Lenders or any other instructing
group of Lenders specified by this Agreement) as it deems appropriate or it
shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense that may be incurred by it by reason of taking or
continuing to take any such action. Each Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
other Loan Documents in accordance with a request of the Required Lenders (or,
if so specified by this Agreement, all Lenders or any other instructing group of
Lenders specified by this Agreement), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans.
9.5 Notice of Default. No Agent shall be deemed to have knowledge or notice of
the occurrence of any Default or Event of Default hereunder unless such Agent
shall have received notice from a Lender or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a “notice of default”. In the event that the Administrative Agent
shall receive such a notice, the Administrative Agent shall give notice thereof
to the Lenders. The Administrative Agent shall take such action with respect to
such Default or Event of Default as shall be reasonably directed by the Required
Lenders (or, if so specified by this Agreement, all Lenders or any other
instructing group of Lenders specified by this Agreement); 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 Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.
9.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly acknowledges
that neither any of the Agents nor any of their respective officers, directors,
employees, agents, attorneys-in-fact or affiliates have made any representations
or warranties to it and that no act by any Agent hereafter taken, including any
review of the affairs of a Loan Party or any affiliate of a Loan Party, shall be
deemed to constitute any representation or warranty by any Agent to any Lender.
Each Lender represents to the Agents that it has, independently and without
reliance upon any Agent 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, prospects and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its

 

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Loans or other credit advances hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon any
Agent 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
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition, prospects and creditworthiness of the Loan Parties and their
affiliates. Except for notices, reports and other documents expressly required
to be furnished to the Lenders by the Administrative Agent hereunder, no Agent
shall have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of any Loan Party or any
affiliate of a Loan Party that may come into the possession of such Agent or any
of its officers, directors, employees, agents, attorneys-in-fact or affiliates.
9.7 Indemnification. The Lenders agree to indemnify each Agent in its 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 their respective
Aggregate Exposure Percentages in effect on the date on which indemnification is
sought under this Section (or, if indemnification is sought after the date upon
which the Commitments shall have terminated and the Loans shall have been paid
in full, ratably in accordance with such Aggregate Exposure Percentages
immediately prior to such date), for, and to save each Agent harmless from and
against, any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever that may at any time (including, without limitation, at any time
following the payment of the Loans) be imposed on, incurred by or asserted
against such Agent in any way relating to or arising out of, the Commitments,
this Agreement, any of the other Loan Documents or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by such Agent 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 that are found by a
final and nonappealable decision of a court of competent jurisdiction to have
resulted from such Agent’s gross negligence or willful misconduct. The
agreements in this Section shall survive the payment of the Loans and all other
amounts payable hereunder.
9.8 Agent in Its Individual Capacity. Each Agent and its affiliates may make
loans to, accept deposits from and generally engage in any kind of business with
any Loan Party as though such Agent were not an Agent. With respect to its Loans
made or renewed by it and with respect to any Letter of Credit issued or
participated in by it, each Agent shall have the same rights and powers under
this Agreement and the other Loan Documents as any Lender and may exercise the
same as though it were not an Agent, and the terms “Lender” and “Lenders” shall
include each Agent in its individual capacity.
9.9 Successor Administrative Agent and Successor Swing Line Lender.
(a) The Administrative Agent may resign as Administrative Agent upon 10 days’
notice (such 10 day period, the “Notice Period”) to the Lenders and the Borrower
(the “Administrative Agent Resignation”). The Administrative Agent may be
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without cause, upon the affirmative vote of the Supermajority Lenders to remove
the Administrative Agent and the consent of Borrower, in each case in writing,
or (ii) for so long as the Administrative Agent or any Affiliate of the
Administrative Agent is a Defaulting Lender, upon the affirmative vote of the
Required Lenders to remove the Administrative Agent and the consent of the
Borrower, in each case in writing (each of clause (i) and (ii), an
“Administrative Agent Removal”). In the event of an Administrative Agent
Resignation or an Administrative Agent Removal, the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a) or
Section 8(f) with respect to the Borrower shall have occurred and be continuing)
be subject to approval by the Borrower (which approval shall not be unreasonably
withheld or delayed). In the event of an Administrative Agent Resignation, if no
successor agent is appointed prior to the effective date of the resignation of
the Administrative Agent, the Administrative Agent may appoint, after consulting
with the Lenders and the Borrower, a successor agent from among the Lenders.
Effective upon the acceptance of its appointment as successor agent hereunder,
the Person acting as 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 such appointment and approval,
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 holders of the Loans. If no successor agent has accepted
appointment as Administrative Agent by the effective date of the removal of the
Administrative Agent pursuant to an Administrative Agent Removal, or by the end
of the Notice Period in the case of an Administrative Agent Resignation, the
retiring Administrative Agent’s resignation or removal shall nevertheless
thereupon become effective, and the Lenders shall assume and perform all of the
duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above. After any
retiring Agent’s resignation as Agent (or, in the case of the Administrative
Agent, upon its resignation or removal as set forth in this section), the
provisions of this Section 9 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement and the
other Loan Documents.
(b) If the Administrative Agent is the Swing Line Lender or is an Affiliate of
the Swing Line Lender, then (i) any Administrative Agent Resignation or
Administrative Agent Removal shall also constitute the resignation or removal of
the Swing Line Lender, and (ii) any successor Administrative Agent appointed
pursuant to this Section shall, upon its acceptance of such appointment, become
the successor Swing Line Lender for all purposes hereunder. In such event, (i)
Borrower shall prepay any outstanding Swing Line Loans made by (x) the resigning
Administrative Agent in its capacity as Swing Line Lender, on or prior to the
end of the Notice Period, in the case of an Administrative Agent Resignation,
and (y) the removed Administrative Agent in its capacity as Swing Line Lender as
a condition to the effectiveness of the removal of the Administrative Agent, in
the case of an Administrative Agent Removal, (ii) upon such prepayment, the
retiring or removed Administrative Agent and Swing Line Lender shall surrender
any Swing Line Note held by it to Borrower for cancellation, and (iii) Borrower
shall issue, if so requested by successor Administrative Agent and Swing Line
Lender, a new Swing Line Note to the successor Administrative Agent and Swing
Line Lender.

 

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(c) If the Administrative Agent is an Issuing Lender or is an Affiliate of an
Issuing Lender, then any Administrative Agent Resignation or Administrative
Agent Removal shall also constitute the resignation or removal of such Issuing
Lender. In such event, (i) such Issuing Lender shall no longer be obligated to
issue additional Letters of Credit, (ii) in the case of an Administrative Agent
Removal only, Borrower shall either deliver the originals of all outstanding
Letters of Credit issued by such Issuing Lender to such Issuing Lender or enter
into arrangements with respect to such outstanding Letters of Credit as may be
satisfactory to such Issuing Lender as a condition to the effectiveness of the
removal of the Administrative Agent and (iii) for so long as such Letters of
Credit remain outstanding, the Issuing Lender shall continue to have all of the
rights and obligations of an Issuing Lender hereunder with respect to such
Letters of Credit issued by it prior to its resignation or removal.
9.10 Authorization to Release Liens and Guarantees and Execute SNDAs. The
Administrative Agent is hereby irrevocably authorized by each of the Lenders
(a) to effect any release of Liens or guarantee obligations contemplated by
Section 10.15, and (b) upon request of the Borrower, to execute and deliver
subordination and non-disturbance agreements whereby the Administrative Agent
agrees not to disturb the rights of a counterparty to a Hotel Agreement absent
default by such party thereunder, and such party agrees that its rights under
such Hotel Agreement shall be subordinate to the Liens and security interests of
the Administrative Agent under the Loan Documents.
9.11 The Arrangers. Except to the extent expressly provided in this Agreement
the Arrangers, the Syndication Agents and the Documentation Agent shall not have
any duties or responsibilities, and neither shall incur liability, under this
Agreement and the other Loan Documents.
9.12 Withholding. To the extent required by applicable law, the Administrative
Agent may withhold from any payment to any Lender or other Person receiving
payment under the Loan Documents an amount equivalent to any applicable
withholding tax. If the Internal Revenue Service or any other Governmental
Authority asserts a claim that the Administrative Agent did not properly
withhold tax from amounts paid to or for the account of any Lender or other
Person receiving payment under the Loan Documents because such Lender or other
Person failed to notify the Administrative Agent that withholding on payments
was required, including, without limitation, because of a change in
circumstances which rendered an exemption from or reduction of withholding Tax
ineffective or for any other reason, such Lender shall indemnify the
Administrative Agent fully for all amounts paid, directly or indirectly, by the
Administrative Agent as tax or otherwise, including any penalties or interest
and together with all expenses incurred.
SECTION 10.
MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement or any other Loan Document,
nor any terms hereof or thereof may be amended, supplemented or modified except
in accordance with the provisions of this Section 10.1. The Required Lenders and
each Loan Party to the relevant Loan Document may, or (with the written consent
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the Agents and each Loan Party to the relevant Loan Document may, from time to
time, (a) enter into written amendments, supplements or modifications hereto and
to the other Loan Documents (including amendments and restatements hereof or
thereof) for the purpose of adding any provisions to this Agreement or the other
Loan Documents or changing in any manner the rights of the Lenders or of the
Loan Parties hereunder or thereunder or (b) waive, on such terms and conditions
as may be specified in the instrument of waiver, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall:
(i) forgive the principal amount or extend the final scheduled date of maturity
of any Loan or Reimbursement Obligation, extend the scheduled date of any
amortization payment in respect of any Incremental Term Loan or Incremental
Delayed Draw Term Loan, reduce the stated rate of any interest or fee payable
hereunder or extend the scheduled date of any payment thereof (including
modifying the definition of the term “Interest Period” so as to permit intervals
in excess of six months), or increase the amount or extend the expiration date
of any Commitment of any Lender, in each case without the consent of each Lender
directly affected thereby;
(ii) amend, modify or waive any provision of this Section or reduce any
percentage specified in the definition of Required Lenders or Required
Prepayment Lenders, consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Agreement and the other Loan Documents,
release or subordinate all or substantially all of the Collateral or release or
subordinate all or substantially all of the Subsidiary Guarantors from their
guarantee obligations under the Subsidiary Guaranty, in each case without the
consent of all Lenders;
(iii) amend, modify or waive any condition precedent to any extension of credit
under the Revolving Credit Facility set forth in Section 5.2 (including, without
limitation, the waiver of an existing Default or Event of Default required to be
waived in order for such extension of credit to be made) without the consent of
any Majority Revolving Credit Facility Lenders;
(iv) reduce the percentage specified in the definition of Majority Facility
Lenders with respect to any Facility without the written consent of all Lenders
under such Facility;
(v) amend, modify or waive any provision of Section 9 without the consent of any
Agent directly affected thereby;
(vi) amend, modify or waive any provision of Section 2.6 or Section 2.7 without
the written consent of the Swing Line Lender;
(vii) amend, modify or waive any provision of Section 2.19 or Section 2.13
without the consent of each Lender directly affected thereby;
(viii) amend, modify or waive any provision of Section 3 without the consent of
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(ix) impose restrictions on assignments and participations that are more
restrictive than, or additional to, those set forth in Section 10.6.
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Loan Parties, the
Lenders, the Agents and all future holders of the Loans. In the case of any
waiver, the Loan Parties, the Lenders and the Agents shall be restored to their
former position and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon. Any such waiver,
amendment, supplement or modification shall be effected by a written instrument
signed by the parties required to sign pursuant to the foregoing provisions of
this Section; provided that delivery of an executed signature page of any such
instrument by facsimile transmission shall be effective as delivery of a
manually executed counterpart thereof. Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder (and any amendment, waiver or consent
which by its terms requires the consent of all Lenders may be effected with the
consent of all Lenders other than Defaulting Lenders), except that (x) no
Commitment of any Defaulting Lender may be increased or extended without the
consent of such Lender and (y) any waiver, amendment or other modification
requiring the consent of all Lenders or each affected Lender that by its terms
affects any Defaulting Lender more adversely than other affected Lenders shall
require the consent of such Defaulting Lender.
For the avoidance of doubt, this Agreement and any other Loan Document may be
amended (or amended and restated) with the written consent of the Required
Lenders, the Administrative Agent and each Loan Party to each relevant Loan
Document (x) to add one or more additional credit facilities to this Agreement
and to permit the extensions of credit from time to time outstanding thereunder
and the accrued interest and fees in respect thereof (collectively, the
“Additional Extensions of Credit”) to share ratably in the benefits of this
Agreement and the other Loan Documents with the Incremental Term Loans,
Incremental Delayed Draw Term Loans and Revolving Extensions of Credit and the
accrued interest and fees in respect thereof and (y) to include appropriately
the Lenders holding such credit facilities in any determination of the Required
Lenders, Required Prepayment Lenders and Majority Facility Lenders; provided,
however, that no such amendment shall permit the Additional Extensions of Credit
to share ratably with or with preference to the Loans in the application of
mandatory prepayments without the consent of the Required Prepayment Lenders.
Notwithstanding anything to the contrary contained herein, an amendment to this
Agreement entered into in connection with the establishment of the Incremental
Loans pursuant to Section 2.8 shall not require the approval of the Lenders and
shall be effective upon the execution of an amendment (consistent with the terms
of Section 2.8) of this Agreement between Administrative Agent and Borrower.
10.2 Notices. All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by telecopy), and,
unless otherwise expressly provided herein, shall be deemed to have been duly
given or made when delivered, or three Business Days after being deposited in
the mail, postage prepaid, or, in the case of telecopy

 

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notice, when received, addressed (a) in the case of the Borrower, the Arrangers
and the Administrative Agent, as follows and (b) in the case of the Lenders, as
set forth in an administrative questionnaire delivered to the Administrative
Agent or on Schedule I to the Lender Addendum to which such Lender is a party
or, in the case of a Lender which becomes a party to this Agreement pursuant to
an Assignment and Acceptance, in such Assignment and Acceptance or (c) in the
case of any party, to such other address as such party may hereafter notify to
the other parties hereto:

           
The Borrower:
Pinnacle Entertainment, Inc.  
 
3800 Howard Hughes Parkway  
 
Las Vegas, Nevada 89109  
 
Attention: Stephen H. Capp  
 
With copies to: John A. Godfrey  
 
                         Chris Plant  
 
Telecopy: (702) 784-7778  
 
Telephone: (702) 784-7777  
 
       
The Arrangers:
Bank of America-Merrill Lynch  
 
901 Main Street, 64th Floor  
 
Dallas, TX 75202  
 
Attn: Brian Corum  
 
Telephone: (214) 209-0921  
 
Telecopy: (214) 209-0905  
 
       
and:
JPMorgan Securities Inc.  
 
383 Madison Avenue  
 
24th Floor  
 
New York, NY 10179  
 
Attention: Marc E. Costantino  
 
Telephone: 212-622-8167  
 
       
The Administrative Agent:
Barclays Capital  
 
70 Hudson St, FL 10th  
 
Jersey City, NJ 07302  
 
Phone: (201) 499-8095  
 
Fax: (917) 522-0569  
 
Attn: Nicholas J. Guzzardo  
 
         Portfolio Administrator  
 
E-mail: nicholas.guzzardo@barcap.com  
 
       
Issuing Lender:
As notified by such Issuing Lender to the
Administrative Agent and the Borrower

provided that any notice, request or demand to or upon the any Agent, the
Issuing Lender or any Lender shall not be effective until received.

 

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10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
10.4 Survival of Representations and Warranties. All representations and
warranties made herein, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans and other extensions of credit hereunder.
10.5 Payment of Expenses. The Borrower agrees (a) to pay or reimburse the Agents
for all their reasonable out-of-pocket costs and expenses incurred in connection
with the syndication of the Facilities (other than fees payable to syndicate
members) and the development, preparation and execution of, and any amendment,
supplement or modification to, this Agreement and the other Loan Documents and
any other documents prepared in connection herewith or therewith, and the
consummation and administration of the transactions contemplated hereby and
thereby, including, without limitation, the reasonable fees and disbursements
and other charges of counsel to the Administrative Agent and the charges of
Intralinks, (b) to pay or reimburse each Lender and the Agents for all their
costs and expenses incurred in connection with the enforcement or preservation
of any rights under this Agreement, the other Loan Documents and any other
documents prepared in connection herewith or therewith, including, without
limitation, the fees and disbursements of counsel (including the allocated fees
and disbursements and other charges of in-house counsel) to each Lender and of
counsel to the Agents, (c) to pay, indemnify, or reimburse each Lender and the
Agents for, and hold each Lender and the Agents harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other taxes, if any, which
may be payable or determined to be payable in connection with the execution and
delivery of, or consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver
or consent under or in respect of, this Agreement, the other Loan Documents and
any such other documents, and (d) to pay, indemnify or reimburse each Lender,
each Agent, their respective affiliates, and their respective officers,
directors, trustees, employees, advisors, agents and controlling persons (each,
an “Indemnitee”) for, and hold each Indemnitee harmless from and against any and
all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Loan Documents and any such other
documents, including, without limitation, any of the foregoing relating to the
use of proceeds of the Loans or the violation of, noncompliance with or
liability under, any Environmental Law applicable to the operations of the
Borrower any of its Subsidiaries or any of the Properties and the fees and
disbursements and other charges of legal counsel in connection with claims,
actions or proceedings by any Indemnitee against the Borrower hereunder (all the
foregoing in this clause (d), collectively, the “Indemnified Liabilities”),
provided that the Borrower shall have no obligation hereunder to any Indemnitee
with respect to Indemnified Liabilities to the extent such Indemnified
Liabilities are found by a final and nonappealable

 

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decision of a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of such Indemnitee. No Indemnitee shall be
liable for any damages arising from the use by unauthorized persons of
information or other materials sent through electronic, telecommunications or
other information transmission systems that are intercepted by such persons or
for any special, indirect, consequential or punitive damages in connection with
the Facilities. Without limiting the foregoing, and to the extent permitted by
applicable law, the Borrower agrees not to assert and to cause its Subsidiaries
not to assert, and hereby waives and agrees to cause its Subsidiaries so to
waive, all rights for contribution or any other rights of recovery with respect
to all claims, demands, penalties, fines, liabilities, settlements, damages,
costs and expenses of whatever kind or nature, under or related to Environmental
Laws, that any of them might have by statute or otherwise against any
Indemnitee. All amounts due under this Section shall be payable not later than
30 days after written demand therefore. Statements payable by the Borrower
pursuant to this Section shall be submitted to Chris Plant (Telephone No.
(702) 784-7727) (Fax No. (702) 784-7778), at the address of the Borrower set
forth in Section 10.2, or to such other Person or address as may be hereafter
designated by the Borrower in a notice to the Administrative Agent. The
agreements in this Section shall survive repayment of the Loans and all other
amounts payable hereunder.
10.6 Successors and Assigns; Participations and Assignments.
(a) This Agreement shall be binding upon and inure to the benefit of the
Borrower, the Lenders, the Agents, all future holders of the Loans and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights or obligations under this Agreement without the prior
written consent of the Agents and each Lender.
(b) Any Lender may, without the consent of the Borrower, in accordance with
applicable law, at any time sell to one or more banks, financial institutions or
other entities other than a Defaulting Lender or the Borrower or any of the
Borrower’s Affiliates or Subsidiaries (each, a “Participant”) participating
interests in any Loan owing to such Lender, any Commitment of such Lender or any
other interest of such Lender hereunder and under the other Loan Documents. In
the event of any such sale by a Lender of a participating interest to a
Participant, such Lender’s obligations under this Agreement to the other parties
to this Agreement shall remain unchanged, such Lender shall remain solely
responsible for the performance thereof, such Lender shall remain the holder of
any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Agents shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement and the other Loan Documents. In no event shall
any Participant under any such participation have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent to any
departure by any Loan Party therefrom, except to the extent that such amendment,
waiver or consent would require the consent of all Lenders pursuant to
Section 10.1. The Borrower agrees that if amounts outstanding under this
Agreement and the Loans are due or unpaid, or shall have been declared or shall
have become due and payable upon the occurrence of an Event of Default, each
Participant shall, to the maximum extent permitted by applicable law, be deemed
to have the right of setoff 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, provided that, in purchasing such participating interest, such
Participant

 

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shall be deemed to have agreed to share with the Lenders the proceeds thereof as
provided in Section 10.7(a) as fully as if such Participant were a Lender
hereunder. The Borrower also agrees that each Participant shall be entitled to
the benefits of Section 2.20, Section 2.21 and Section 2.22 with respect to its
participation in the Commitments and the Loans outstanding from time to time as
if such Participant were a Lender; provided that, in the case of Section 2.21,
such Participant shall have complied with the requirements of said Section, and
provided, further, that no Participant shall be entitled to receive any greater
amount pursuant to any such Section than the transferor Lender would have been
entitled to receive in respect of the amount of the participation transferred by
such transferor Lender to such Participant had no such transfer occurred. Each
Lender that sells a participation shall maintain a register on which it enters
the name and address of each Participant and the principal amounts of each
Participant’s interest in the Loans (or other rights or obligations) held by it
(the “Participant Register”). The entries in the Participant Register shall be
conclusive, and such Lender shall treat each Person whose name is recorded in
the Participant Register as the owner of such Loan (or other right or
obligation) hereunder as the owner thereof for all purposes of this Agreement
notwithstanding any notice to the contrary. Any such Participant Register shall
be available for inspection by an Agent at any reasonable time and from time to
time upon reasonable prior notice.
(c) Any Lender (an “Assignor”) may, in accordance with applicable law and upon
written notice to the Administrative Agent, at any time and from time to time
assign to any Lender or any affiliate, Related Fund or Control Investment
Affiliate thereof or, with the consent of the Borrower and the Administrative
Agent and, in the case of any assignment of Revolving Credit Commitments, the
written consent of the Issuing Lender and the Swing Line Lender (which, in each
case, shall not be unreasonably withheld or delayed) (provided (x) that no such
consent need be obtained by the Administrative Agent or any of its affiliates
and (y) the consent of the Borrower need not be obtained with respect to any
assignment of Incremental Term Loans or Incremental Delayed Draw Term Loans), to
an additional bank, financial institution or other entity (an “Assignee”) all or
any part of its rights and obligations under this Agreement pursuant to an
Assignment and Acceptance executed by such Assignee and such Assignor (and,
where the consent of the Borrower or, the Agents or the Issuing Lender or the
Swing Line Lender is required pursuant to the foregoing provisions, by the
Borrower and such other Persons) and delivered to the Administrative Agent for
its acceptance and recording in the Register; provided that no such assignment
to an Assignee (other than any Lender, Related Fund or any affiliate thereof)
shall be in an aggregate principal amount of less than $5,000,000 as to the
Revolving Credit Facility, $1,000,0000 as to the Incremental Term Facility or
the Incremental Delayed Draw Term Facility (other than in the case of an
assignment of all of a Lender’s interests under this Agreement), unless
otherwise agreed by the Borrower and the Administrative Agent. Any such
assignment need not be ratable as among the Facilities, but shall be a ratable
portion of each Facility so assigned. Upon such execution, delivery, acceptance
and recording, from and after the effective date determined pursuant to such
Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder with Commitments and/or Loans as set forth
therein, and (y) the Assignor thereunder shall, to the extent provided in such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all of an Assignor’s
rights and obligations under this Agreement, such Assignor shall cease to be a
party hereto, except as to Section 2.20, Section 2.21 and Section 10.5 in
respect of the period prior to such effective date). Notwithstanding any

 

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provision of this Section, the consent of the Borrower shall not be required for
any assignment that occurs at any time when any Event of Default shall have
occurred and be continuing. For purposes of the minimum assignment amounts set
forth in this paragraph, multiple assignments by two or more Related Funds shall
be aggregated.
(d) The Administrative Agent shall, on behalf of the Borrower, maintain at its
address referred to in Section 10.2 a copy of each Assignment and Acceptance
delivered to it and a register (the “Register”) for the recordation of the names
and addresses of the Lenders and the Commitment of, and principal amount of the
Loans owing to, each Lender from time to time. In addition, the Administrative
Agent shall maintain on the Register information regarding the designation, and
revocation of designation, of any Lender as a Defaulting Lender. The entries in
the Register shall be conclusive, in the absence of manifest error, and the
Borrower, each Agent and the Lenders shall treat each Person whose name is
recorded in the Register as the owner of the Loans and any Notes evidencing such
Loans recorded therein for all purposes of this Agreement. Any assignment of any
Loan, whether or not evidenced by a Note, shall be effective only upon
appropriate entries with respect thereto being made in the Register (and each
Note shall expressly so provide). Any assignment or transfer of all or part of a
Loan evidenced by a Note shall be registered on the Register only upon surrender
for registration of assignment or transfer of the Note evidencing such Loan,
accompanied by a duly executed Assignment and Acceptance; thereupon one or more
new Notes in the same aggregate principal amount shall be issued to the
designated Assignee, and the old Notes shall be returned by the Administrative
Agent to the Borrower marked “canceled”. The Register shall be available for
inspection by the Borrower or any Lender (with respect to any entry relating to
such Lender’s Loans) at any reasonable time and from time to time upon
reasonable prior notice. A list of current Lenders will be made available for
any Lender who requests same while any amendment to this Agreement is pending.
(e) Upon its receipt of an Assignment and Acceptance executed by an Assignor and
an Assignee (and, in any case where the consent of any other Person is required
by Section 10.6(c), by each such other Person) together with payment to the
Administrative Agent of a registration and processing fee of $3,500 (treating
multiple, simultaneous assignments by or to two or more Related Funds as a
single assignment) (except that no such registration and processing fee shall be
payable in the case of an Assignee which is already a Lender or is an affiliate
or Related Fund of a Lender or a Person under common management with a Lender),
the Administrative Agent shall (i) promptly accept such Assignment and
Acceptance and (ii) on the effective date determined pursuant thereto record the
information contained therein in the Register and give notice of such acceptance
and recordation to the Borrower. On or prior to such effective date, the
Borrower, at its own expense, upon request, shall execute and deliver to the
Administrative Agent (in exchange for the Revolving Credit Note, Incremental
Term Note and/or Incremental Delayed Draw Term Note, as the case may be, of the
assigning Lender) a new Revolving Credit Note, Incremental Term Note and/or
Incremental Delayed Draw Term Note, as the case may be, to the order of such
Assignee in an amount equal to the Revolving Credit Commitment, Incremental Term
Loans and/or Incremental Delayed Draw Term Commitment and Incremental Delayed
Draw Term Loans, as the case may be, assumed or acquired by it pursuant to such
Assignment and Acceptance and, if the Assignor has retained a Revolving Credit
Commitment, Incremental Term Loan and/or Incremental Delayed Draw Term
Commitment and Incremental Delayed Draw Term Loans, as the case may be, upon
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new Revolving Credit Note, Incremental Term Note and/or Incremental Delayed Draw
Term Note, as the case may be, to the order of the Assignor in an amount equal
to the Revolving Credit Commitment, Incremental Term Loans and/or Incremental
Delayed Draw Term Commitment and Incremental Delayed Draw Term Loans, as the
case may be, retained by it hereunder. Such new Note or Notes shall be dated the
Effective Date and shall otherwise be in the form of the Note or Notes replaced
thereby.
(f) For avoidance of doubt, the parties to this Agreement acknowledge that the
provisions of this Section concerning assignments of Loans and Notes relate only
to absolute assignments and that such provisions do not prohibit assignments
creating security interests in Loans and Notes, including, without limitation,
any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve
Bank in accordance with applicable law, or, in the case of a Lender which is a
fund, to any holders of obligations owned or securities issued by such Lender or
to any trustee for, or other representatives of, such holders. No such
assignments creating security interest shall require the consent or approval of
either the Administrative Agent or Borrower (provided, however, any absolute
assignments do require such consent and approval as provided in this
Section 10.6).
(g) Notwithstanding anything to the contrary contained herein, any Lender (a
“Granting Lender”) may grant to a special purpose funding vehicle (an “SPC”),
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower, the option to provide to the Borrower all
or any part of any Loan that such Granting Lender would otherwise be obligated
to make to the Borrower pursuant to this Agreement; provided that (i) nothing
herein shall constitute a commitment by any SPC to make any Loan and (ii) if an
SPC elects not to exercise such option or otherwise fails to provide all or any
part of such Loan, the Granting Lender shall be obligated to make such Loan
pursuant to the terms hereof. The making of a Loan by an SPC hereunder shall
utilize the Commitment of the Granting Lender to the same extent, and as if,
such Loan were made by such Granting Lender. Each party hereto hereby agrees
that no SPC shall be liable for any indemnity or similar payment obligation
under this Agreement (all liability for which shall remain with the Granting
Lender). In furtherance of the foregoing, each party hereto hereby agrees (which
agreement shall survive the termination of this Agreement) that, prior to the
date that is one year and one day after the payment in full of all outstanding
commercial paper or other indebtedness of any SPC, it will not institute
against, or join any other person in instituting against, such SPC any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
under the laws of the United States or any state thereof. In addition,
notwithstanding anything to the contrary in this Section 10.6(g), any SPC may
(A) with notice to, but without the prior written consent of, the Borrower and
the Administrative Agent and without paying any processing fee therefor, assign
all or a portion of its interests in any Loans to the Granting Lender, or with
the prior written consent of the Borrower and the Administrative Agent (which
consent shall not be unreasonably withheld) to any financial institutions
providing liquidity and/or credit support to or for the account of such SPC to
support the funding or maintenance of Loans, and (B) disclose on a confidential
basis any non-public information relating to its Loans to any rating agency,
commercial paper dealer or provider of any surety, guarantee or credit or
liquidity enhancement to such SPC; provided that non-public information with
respect to the Borrower may be disclosed only with the Borrower’s consent which
will not be unreasonably withheld. This paragraph (g) may not be amended

 

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without the written consent of any SPC with Loans outstanding at the time of
such proposed amendment.
(h) No such assignment shall be made (i) without the consent of the Required
Lenders and the Administrative Agent and cancellation of the Commitments and
Obligations assigned with such consent, to the Borrower or any of the Borrower’s
Affiliates or Subsidiaries (ii) to any Defaulting Lender or any of its
Subsidiaries, or any Person who, upon becoming a Lender hereunder, would
constitute any of the foregoing Persons described in this clause (ii), or
(iii) to a natural person. Any Commitments or Obligations assigned (with or
without Required Lender consent) to the Borrower or any Subsidiary or Affiliate
of the Borrower shall be deemed cancelled and no longer outstanding and no such
assignee shall have any right whatsoever with respect to that portion of the
Commitments or Obligations so assigned, including to (x) consent to any
amendment, modification, waiver, consent or other action with respect to any of
the terms of any Loan Document, or otherwise to vote on any matter related to
any Loan Document or require the Administrative Agent or any Lender to undertake
any action (or refrain from taking any action) with respect to any Loan
Document, (y) attend any meeting with the Administrative Agent or any Lender or
receive any information from any Agent or any Lender, or to the benefit of any
advice provided by counsel to the Administrative Agent or the other Lenders or
to challenge the attorney-client privilege of the communications between the
Administrative Agent, such other Lenders and such counsel, or (z) make or bring
any claim, in the capacity of a Lender, against the Administrative Agent with
respect to the duties of the Administrative Agent to such assignee.
10.7 Adjustments; Set-off.
(a) Except to the extent that this Agreement provides for payments to be
allocated to a particular Lender or to the Lenders under a particular Facility,
if any Lender (a “Benefited Lender”) shall at any time receive any payment of
all or part of the Obligations owing to it, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 8(f), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of such other Lender’s Obligations, such Benefited
Lender shall purchase for Cash from the other Lenders a participating interest
in such portion of each such other Lender’s Obligations, or shall provide such
other Lenders with the benefits of any such collateral, as shall be necessary to
cause such Benefited Lender to share the excess payment or benefits of such
collateral ratably with each of the Lenders; provided, however, that (i) if all
or any portion of such excess payment or benefits is thereafter recovered from
such Benefited Lender, such purchase shall be rescinded, and the purchase price
and benefits returned, to the extent of such recovery, but without interest; and
(ii) the provisions of this Section 10.7(a) shall not be construed to apply to
(x) any payment made by or on behalf of the Borrower pursuant to and in
accordance with the express terms of this Agreement (including the application
of funds arising from the Back-Stop Arrangements), (y) the application of
proceeds of Back-Stop Arrangements in respect of obligations relating to Letters
of Credit and Swing Line Loans (including related Lender participation
obligations) provided for in Section 2.26, or (z) any payment obtained by a
Lender as consideration for the assignment of or sale of a participation in any
of its Commitments, Loans or subparticipations in L/C Obligations or Swing Line
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the Borrower or any Affiliate thereof (as to which the provisions of this
Section 10.7(a) shall apply unless such assignment is made with the consent of
the Required Lenders.
(b) In addition to any rights and remedies of the Lenders provided by law, each
Lender shall have the right, without prior notice to the Borrower, any such
notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise), to set
off and appropriate and apply against such amount any and all deposits (general
or special, time or demand, provisional or final), in any currency, and any
other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of the Borrower; provided, that in the event that any
Defaulting Lender shall exercise any such right of setoff, (x) all amounts so
set off shall be paid over immediately to the Administrative Agent for further
application in accordance with the provisions of Section 2.27 and, pending such
payment, shall be segregated by such Defaulting Lender from its other funds and
deemed held in trust for the benefit of the Administrative Agent and the
Lenders, and (y) the Defaulting Lender shall provide promptly to the
Administrative Agent a statement describing in reasonable detail the Obligations
owing to such Defaulting Lender as to which it exercised such right of setoff.
Each Lender agrees promptly to notify the Borrower and the Administrative Agent
after any such setoff and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of such setoff and
application.
10.8 Counterparts. This Agreement may be executed by one or more of the parties
to this Agreement on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement or of a
Lender Addendum by facsimile transmission shall be effective as delivery of a
manually executed counterpart hereof. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
10.9 Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Without limiting the foregoing provisions of this
Section 10.9, if and to the extent that the enforceability of any provisions in
this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief
Laws, as determined in good faith by the Administrative Agent, the Issuing
Lenders or the Swing Line Lender, as applicable, then such provisions shall be
deemed to be in effect only to the extent not so limited.
10.10 Integration. This Agreement and the other Loan Documents represent the
entire agreement of the Borrower, the Agents, the Arranger and the Lenders with
respect to the subject matter hereof and thereof, and there are no promises,
undertakings, representations or warranties by the Arranger, any Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.

 

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10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 Submission To Jurisdiction; Waivers. The Borrower hereby irrevocably and
unconditionally:
(a) submits for itself and its Property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in Section 10.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it may have
to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
10.13 Acknowledgments. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and delivery of
this Agreement and the other Loan Documents;
(b) neither the Arranger, any Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Arranger, the Agents and the Lenders, on one hand, and the Borrower, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor; and
(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Arranger, the Agents and the Lenders or among the Borrower and the Lenders.
10.14 Confidentiality. Each of the Agents and the Lenders agrees to keep
confidential all non-public information provided to it by any Loan Party
pursuant to this

 

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Agreement that is designated by such Loan Party as confidential; provided that
nothing herein shall prevent any Agent or any Lender from disclosing any such
information (a) to the Arranger, any Agent, any other Lender or any affiliate of
any thereof, (b) to any Participant, pledgee or Assignee (each, a “Transferee”)
or prospective Transferee that agrees to comply with the provisions of this
Section or substantially equivalent provisions, (c) to any of its employees,
directors, agents, attorneys, accountants and other professional advisors,
(d) to any financial institution that is a direct or indirect contractual
counterparty in swap agreements or such contractual counterparty’s professional
advisor (so long as such contractual counterparty or professional advisor to
such contractual counterparty agrees to be bound by the provisions of this
Section), (e) upon the request or demand of any Governmental Authority having
jurisdiction over it, (f) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (g) in connection with any litigation or similar proceeding,
(h) that has been publicly disclosed other than in breach of this Section,
(i) to the National Association of Insurance Commissioners or any similar
organization or any nationally recognized rating agency that requires access to
information about a Lender’s investment portfolio in connection with ratings
issued with respect to such Lender or (j) in connection with the exercise of any
remedy hereunder or under any other Loan Document. Notwithstanding anything to
the contrary in the foregoing sentence or any other express or implied
agreement, arrangement or understanding, the parties hereto hereby agree that,
from the commencement of discussions with respect to the financing provided
hereunder, any party hereto (and each of its employees, representatives, or
agents) is permitted to disclose to any and all persons, without limitation of
any kind, the tax structure and tax aspects of the transactions contemplated
hereby, and all materials of any kind (including opinions or other tax analyses)
related to such tax structure and tax aspects.
10.15 Release of Collateral and Guarantee Obligations.
(a) Notwithstanding anything to the contrary contained herein or in any other
Loan Document, upon request of the Borrower in connection with any Disposition
of Property permitted by the Loan Documents, the Administrative Agent shall
timely, and in no event later than thirty (30) days following the Administrative
Agent’s receipt of the notice of such disposition (without notice to, or vote or
consent of, any Lender, or any affiliate of any Lender that is a party to any
Specified Hedge Agreement) take such actions as shall be required to release its
security interest in any Collateral being Disposed of in such Disposition, and
to release any guarantee obligations under any Loan Document of any Person being
Disposed of in such Disposition, to the extent necessary to permit consummation
of such Disposition in accordance with the Loan Documents.
(b) Notwithstanding anything to the contrary contained herein or any other Loan
Document, when all Obligations (other than obligations in respect of any
Specified Hedge Agreement and indemnification obligations which are not then due
and payable) have been paid in full, all Commitments have terminated or expired
and no Letter of Credit shall be outstanding, upon request of the Borrower, the
Administrative Agent shall promptly (without notice to, or vote or consent of,
any Lender, or any affiliate of any Lender that is a party to any Specified
Hedge Agreement) take such actions as shall be required to release its security
interest in all Collateral, and to release all guarantee obligations under any
Loan Document, whether or not on the date of such release there may be
outstanding Obligations in respect of Specified Hedge

 

123

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Agreements. Any such release of guarantee obligations shall be deemed subject to
the provision that such guarantee obligations shall be reinstated if after such
release any portion of any payment in respect of the Obligations guaranteed
thereby shall be rescinded or must otherwise be restored or returned upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payment had not been made.
10.16 Accounting Changes. In the event that any “Accounting Change” (as defined
below) shall occur and such change results in a change in the method of
calculation of financial covenants, standards or terms in this Agreement, then
the Borrower and the Administrative Agent agree to enter into negotiations in
order to amend such provisions of this Agreement so as to equitably reflect such
Accounting Changes with the desired result that the criteria for evaluating the
Borrower’s financial condition shall be the same after such Accounting Changes
as if such Accounting Changes had not been made. Until such time as such an
amendment shall have been executed and delivered by the Borrower, the
Administrative Agent and the Required Lenders, all financial covenants,
standards and terms in this Agreement shall continue to be calculated or
construed as if such Accounting Changes had not occurred. “Accounting Change”
refers to (a) any change in accounting principles required by the promulgation
of any rule, regulation, pronouncement or opinion by the Financial Accounting
Standards Board of the American Institute of Certified Public Accountants or, if
applicable, the SEC, the Borrower’s manner of accounting addressed in the
preferability letter from the Borrower’s independent auditors to the Borrower in
order for such auditor to deliver an opinion to the Borrower’s financial
statements required to be delivered pursuant to Section 6.1 without
qualification.
10.17 Delivery of Lender Addenda. Each initial Lender shall become a party to
this Agreement by delivering to the Administrative Agent a Lender Addendum duly
executed by such Lender, the Borrower and the Administrative Agent.
10.18 WAIVERS OF JURY TRIAL. THE BORROWER, THE AGENTS AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
10.19 USA Patriot Act Notification. The Lenders hereby notify the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law on October 26, 2001)) (the “Act”), the Lenders are required to
obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow the Lenders to identify the Borrower in accordance with the Act.
The Borrower agrees to cooperate with each Lender with respect to the
requirements of the Act and to provide true, accurate and complete information
to each Lender in response to any request relating thereto.

 

124

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10.20 Gaming Laws and Liquor Laws. Any other provision of this Agreement or any
other Loan Documents to the contrary notwithstanding, all rights, remedies and
powers provided in this Agreement and the other Loan Documents, including with
respect to the Collateral, may be exercised only to the extent, and in the
manner, that the exercise thereof does not violate any applicable Gaming Laws
and Liquor Laws, and only to the extent that required approvals, including prior
approvals are obtained from the requisite Gaming Boards and Liquor Authorities.
Further, all provisions of this Agreement and the other Loan Documents,
including with respect to the Collateral, are intended to be subject to all
applicable mandatory provisions of the Gaming Laws and Liquor Laws and to be
limited solely to the extent necessary to not render the provisions of this
Agreement and the other Loan Documents invalid or unenforceable, in whole or in
part. Administrative Agent will timely apply for and receive all required
approvals, and otherwise comply with all rules and regulations, of the
applicable Gaming Board and Liquor Authorities for the sale or other disposition
of any Collateral, including, without limitation, any interest in any Restricted
Subsidiary holding a Gaming License, Liquor License or any gaming property or
equipment regulated by Gaming Laws (including any gaming equipment consisting of
slot machines, gaming tables, cards, dice, gaming chips, player tracking
systems, and all other “gaming devices” (as such terms or words of like import
referring thereto are defined in the applicable Gaming Laws)), and “associated
equipment” (as such term or other words of like import referring thereto are
defined in applicable Gaming Laws).
[signature pages to follow]

 

125

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.

            PINNACLE ENTERTAINMENT, INC.,
a Delaware corporation, as Borrower
      By:   /s/ Stephen H. Capp         Name:   Stephen H. Capp        Title:  
Executive Vice President and
Chief Financial Officer   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            BARCLAYS BANK PLC
as Administrative Agent
      By:   /s/ Craig Malloy         Name:   Craig Malloy        Title:   Vice
President   

Signature Page to Third Amended and Restated Credit Agreement

 

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

 

            BANC OF AMERICA SECURITIES LLC,
as Joint Lead Arranger
      By:   /s/ Thomas T. Shealy, Jr.         Name:   Thomas T. Shealy, Jr.     
  Title:   Managing Director   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            JPMORGAN SECURITIES INC.,
as Joint Lead Arranger
      By:   /s/ Kenneth A. Lang         Name:   Kenneth A. Lang        Title:  
Managing Director   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            WELLS FARGO, N.A.,
as Issuing Lender
      By:   /s/ Clark A. Wood         Name:   Clark A. Wood        Title:  
Senior Vice President   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            LENDER:

Deutsche Bank Trust Company Americas
      By:   /s/ Mary Kay Coyle         Name:   Mary Kay Coyle        Title:  
Managing Director            By:   /s/ Robert M. Wood, Jr.         Name:  
Robert M. Wood, Jr.        Title:   Director   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            LENDER:

UBS LOAN FINANCE LLC
      By:   /s/ Marie Haddad         Name:   Marie Haddad        Title:  
Associate Director            By:   /s/ Irja R. Otsa         Name:   Irja R.
Otsa        Title:   Associate Director   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            LENDER:
      /s/ Marc E. Costantino       By:  JPMorgan Chase Bank, N.A.          Name:
Marc E. Costantino          Title:   Executive Director   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            LENDER:

Bank of America, N.A.
      By:   /s/ Brian D. Corum         Name:   Brian D. Corum        Title:  
Senior Vice President   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            LENDER: Calyon New York Branch
      By:   /s/ David Bowers         Name:   David Bowers        Title:  
Managing Director            By:   /s/ Joseph A. Asciolla         Name:   Joseph
A. Asciolla        Title:   Managing Director   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            LENDER:

Barclays Bank PLC
      By:   /s/ Craig Malloy         Name:   Craig Malloy        Title:   Vice
President   

Signature Page to Third Amended and Restated Credit Agreement

 

 

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

 

            LENDER:

CAPITAL ONE NATIONAL ASSOCIATION
      By:   /s/ Ross S. Wales         Name:   Ross S. Wales        Title:  
Senior Vice President     

Signature Page to Third Amended and Restated Credit Agreement

 

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

 

Annex A

PRICING GRID
The margins set forth in the following table shall apply:

                              Applicable Margin for     Applicable Margin      
  Consolidated Total Leverage   LIBOR Loans/ Letter of     for Base Rate        
Ratio   Credit Fees     Loans     Commitment Fee  
< 4.00:1
    3.000 %     1.500 %     0.250 %
> 4.00:1 but < 4.50:1
    3.250 %     1.750 %     0.300 %
> 4.50:1 but < 5.00:1
    3.500 %     2.000 %     0.375 %
> 5.00:1 but < 5.50:1
    3.750 %     2.250 %     0.375 %
> 5.50:1 but < 6.00:1
    4.000 %     2.500 %     0.500 %
> 6.00:1 but < 6.50:1
    4.250 %     2.750 %     0.500 %
> 6.50:1 but < 7.00:1
    4.500 %     3.000 %     0.500 %
> 7.00:1
    4.750 %     3.250 %     0.750 %

Changes in the Applicable Margin and the Commitment Fee Rate resulting from
changes in the Consolidated Total Leverage Ratio shall become effective on the
date (the “Adjustment Date”) on which financial statements are delivered or
required to be delivered to the Lenders pursuant to Section 6.1(a) or
Section 6.1(b) of this Agreement (but in any event not later than the 45th day
after the end of each of the first three quarterly periods of each fiscal year
or the 90th day after the end of each fiscal year, as the case may be) and shall
remain in effect until the next change to be effected pursuant to this
paragraph. Notwithstanding the foregoing, the Consolidated Total Leverage Ratio
shall be deemed to be greater than 6.00:1 but less than or equal to 6.50:1 from
the Effective Date to the date on which the financial statements are delivered
or required to be delivered to the Lenders pursuant to this Agreement for the
fiscal period ended at least three full months after the Effective Date. If any
financial statements referred to above are not delivered within the time periods
specified above, then, until such financial statements are delivered, the
Consolidated Total Leverage Ratio as at the end of the fiscal period that would
have been covered thereby shall for the purposes of this definition be the
highest level for all pricing grids.
In the event that any financial statement or any Compliance Certificate
delivered pursuant to Section 6.1(a) or Section 6.1(b) of this Agreement is
shown to be inaccurate, and such inaccuracy, if corrected would have led to a
higher Applicable Margin for any period (an “Applicable Period”) than such
margin applied for such Applicable Period, then (i) the Borrower shall
immediately deliver to Administrative Agent a corrected Compliance Certificate
for such Applicable Period, (ii) the Applicable Margin shall be determined by
reference to the corrected Compliance Certificate (but in no event shall the
Lenders owe any amounts to the Borrower), and (iii) the Borrower shall
immediately pay to Administrative Agent the additional interest owing as a
result of such increased margin for such Applicable Period, which payment shall
be promptly applied by Administrative Agent in accordance with the terms hereof
(it being understood and agreed that nothing in this section shall limit the
rights of Administrative Agent and the Lenders hereunder).

 

A-1

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Schedule 1.1(a)
List of Mortgaged Properties (Leasehold and Fee)
DESCRIPTION OF PROPERTIES

1.  
Belterra Resort & Casino (fee and leasehold interests) located at 777 Belterra
Drive, Belterra, Indiana 47020
  2.  
Boomtown Bossier City (fee and leasehold interests) located at 300 Riverside
Drive in Bossier City, Louisiana 71111
  3.  
Boomtown New Orleans (fee) located at 4132 Peters Road, Harvey, Louisiana 70058
  4.  
River City Property
  5.  
Lumiere Property
  6.  
Property (fee) located at 901 and 925 N. First Street in St. Louis, Missouri
63102
  7.  
Property (19 parcels) (fee) located in St. Louis, Missouri, owned by PNK (ST.
LOUIS RE), LLC.
  8.  
Property (fee) located in St. Louis, Missouri, owned by Pinnacle Entertainment,
Inc. (Cherrick’s subdivision)
  9.  
Property (leasehold interest) located in St. Louis, Missouri, leased by
President Riverboat Casino-Missouri, Inc. (Mooring Points)
  10.  
Boomtown Hotel and Casino (fee, including water rights) located in Reno, Nevada
  11.  
Property (fee, including water rights) located at 1800 S. Verdi Road, Verdi,
Nevada 89439
  12.  
Property (fee, including water rights) located at 350 Boomtown Garson Road,
Verdi, Nevada 89439
  13.  
L’Auberge du Lac Hotel and river-boat Casino (fee and leasehold interests)
located in Lake Charles, Louisiana
  14.  
Property (fee) to be used for roadway, signage or other use related to the Lake
Charles Project located in Lake Charles, Louisiana.
  15.  
Property (water line easement), located in Lake Charles, Louisiana

 

 

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

 

DESCRIPTION OF PROPERTIES

16.  
Four parcels (fee) purchased from Richard, Sittig, Connor, and Hatchett,
portions of which are to be dedicated as a public roadway providing alternative
access to the L’Auberge du Lac Hotel in Lake Charles, Louisiana
  17.  
Property (fee) located in Lake Charles, LA, owned by PNK (Lake Charles), L.L.C.
(Burgoyne Residence)
  18.  
Property (fee) located in Lake Charles, LA, owned by PNK (SCB), L.L.C. (Harrah’s
Acquisition)
  19.  
Property (leasehold interest) located in Lake Charles, Louisiana, leased by PNK
(Lake Charles), L.L.C. (Sugarcane Bay)
  20.  
Property (fee) located in Lake Charles, Louisiana, owned by PNK (Lake Charles),
L.L.C. (Country Club Road)
  21.  
Property (fee) located in Baton Rouge, Louisiana, owned by Yankton Investments,
LLC
  22.  
Property (fee) located in Baton Rouge, Louisiana, owned by PNK (Baton Rouge)
Partnership
  23.  
Property (fee) located in Central City, Colorado, owned by Pinnacle
Entertainment, Inc.

 

- 2 -

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Schedule 1.1(b)
List of Preferred Ship Mortgages
DESCRIPTION OF PREFERRED SHIP MORTGAGES
“MARY’S PRIZE”, NO. 1028011

1.  
Amended and Restated Preferred Ship Mortgage, dated as of December 14, 2005,
recorded January 10, 2006 as Document No. 4755187, Batch 445312 in the Official
Records of the National Vessel Documentation Center
  2.  
First Amendment to Amended and Restated Preferred Ship Mortgage, dated
November 17, 2006, recorded November 17, 2006 as Document No. 6345200, Batch
554870 in the Official Records of the National Vessel Documentation Center
  3.  
Assignment, Assumption and Amendment of Amended and Restated Preferred Ship
Mortgage, dated July 24, 2009, recorded July 24, 2009 as Document No. 10805035,
Batch 702697 in the Official Records of the National Vessel Documentation Center

“BOOMTOWN BELLE II”, NO. 1028319

4.  
Amended and Restated Preferred Ship Mortgage, dated as of December 14, 2005,
recorded January 10, 2006 as Document No. 4755189, Batch 445312 in the Official
Records of the National Vessel Documentation Center
  5.  
First Amendment to Amended and Restated Preferred Ship Mortgage, dated
November 14, 2006, recorded November 17, 2006 as Document No. 6345197, Batch
554870 in the Official Records of the National Vessel Documentation Center
  6.  
Assignment, Assumption and Amendment of Amended and Restated Preferred Ship
Mortgage, dated July 24, 2009, recorded July 24, 2009 as Document No. 10805032,
Batch 702697 in the Official Records of the National Vessel Documentation Center

“MISS BELTERRA”, NO. 1098321

7.  
Amended and Restated Preferred Ship Mortgage, dated December 30, 2005, recorded
January 10, 2006 as Document No. 4755190, Batch 445312 in the Official Records
of the National Vessel Documentation Center
  8.  
First Amendment to Amended and Restated Preferred Ship Mortgage, dated
November 17, 2006, recorded November 17, 2006 as Document No. 6345203, Batch
554870 in the Official Records of the National Vessel Documentation Center

 

 

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

 

DESCRIPTION OF PREFERRED SHIP MORTGAGES

9.  
Assignment, Assumption and Amendment of Amended and Restated Preferred Ship
Mortgage, dated July 24, 2009, recorded July 24, 2009 as Document No. 10805028,
Batch 702697 in the Official Records of the National Vessel Documentation Center

“L’AUBERGE DU LAC”, NO. 1160993

10.  
Amended and Restated Preferred Ship Mortgage, dated December 30, 2005, recorded
January 10, 2006 as Document No. 4755188, Batch 445312 in the Official Records
of the National Vessel Documentation Center
  11.  
First Amendment to Amended and Restated Preferred Ship Mortgage, dated
November 14, 2006, recorded November 17, 2006 as Document No. 6345194, Batch
554870 in the Official Records of the National Vessel Documentation Center
  12.  
Assignment, Assumption and Amendment of Amended and Restated Preferred Ship
Mortgage, dated July 24, 2009, recorded July 27, 2009 as Document No. 10823994,
Batch 702852 in the Official Records of the National Vessel Documentation Center

“ADMIRAL”, NO. 204086 AND “ADMIRAL BARGE ONE”, NO. 689603

13.  
Preferred Ship Mortgage, dated July 24, 2009, recorded July 27, 2009 as Document
No. 10824254, Batch 703338 in the Official Records of the National Vessel
Documentation Center

 

- 2 -

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

 

Schedule 1.1(c)
List of Post-Closing Gaming Pledge Agreement Amendments
None

 

 

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

 

Schedule 1.1(d)
List of Existing Letters of Credit

•  
Letter of Credit #NZS532493 in the amount of $187,500 for the benefit of
Fidelity and Deposit Company of Maryland becoming due on November 30, 2010
  •  
Letter of Credit #NZS553188 in the amount of $6,159,478 for the benefit of
Zurich American Insurance becoming due on September 13, 2010
  •  
Letter of Credit #NZS567622 in the amount of $525,000 for the benefit of United
States Fidelity & Guaranty Company becoming due on March 22, 2010
  •  
Letter of Credit #NZS581422 in the amount of $2,750,000 for the benefit of
Zurich American Insurance becoming due on September 29, 2010
  •  
Letter of Credit #NZS594199 in the amount of $3,000,000 for the benefit of
National City Bank becoming due on May 13, 2010

 

 

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

 

Schedule 4.4
List of Outstanding Consents, Authorizations, Filings, Proceedings and Notices
SEC
Filing a Form 8-K with the SEC regarding the execution of the Third Amended and
Restated Credit Agreement and the other Loan Documents and the consummation of
the transactions contemplated thereby within four (4) business days of the
Effective Date.
Gaming Boards

1.  
Louisiana:

  1.1.  
The transaction and informational reports as required by Louisiana Gaming
Control Board regulations which will be filed within 15 days after the Effective
Date. Such advance notice to and prior consent, exemption, waiver, or written
approval of the Louisiana Gaming Control Board as may be required by Louisiana
Gaming Laws and regulations in the event that Borrower requests that Lenders
and/or New Lenders provide any of the Incremental Facilities described in and
subject to the terms and conditions of the Third Amended and Restated Credit
Agreement.

2.  
Nevada:

  2.1.  
Such post-closing transaction and informational reports as may be required by
the Nevada Gaming Commission Regulation 8.130 to be filed with the Nevada State
Gaming Control Board within thirty (30) days after the end of the calendar
quarter in which the Effective Date occurs; and

3.  
Missouri:

  3.1.  
File with the Missouri Gaming Commission notice of closing and informational
report with closing documentation within seven(7) days of closing.

4.  
Indiana:

  4.1.  
Submission of a legal opinion from Indian gaming counsel demonstrating
compliance with IC 4-33-4-21.

Filings, Registrations and Recordings
Filing and recording of new UCC-1 financing statements
Filing of amendments to the Mortgages covering the Property listed on
Schedule 4.19(b).
All items noted above on this Schedule 4.4 with respect to the Gaming Boards.
All items noted in the Post Closing Agreement

 

 

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Schedule 4.15 (a)
List of Subsidiaries (Unrestricted, Restricted and Immaterial)

                                              No.                        
Shares/Units                         Owned by             Jurisdiction of   No.
Shares/Units   Borrower or             Organization,   Issued &   Subsidiary of
      Type of Name   Type of Entity   Outstanding   Borrower   Owner  
Subsidiary1
ACE Gaming LLC (uncertificated)
  New Jersey LLC     100%       100%     PNK Development 13, LLC   U
AREH MLK LLC (uncertificated)
  Delaware LLC     100%       100%     Biloxi Casino Corp.   U
AREP Boardwalk Properties LLC (uncertificated)
  Delaware LLC     100%       100%     Biloxi Casino Corp.   U
Belterra Resort Indiana, LLC (certificated, elected into UCC Article 8)
  Nevada LLC   970 Voting Units 30 Non-Voting Units   1,000 Units   Pinnacle
Entertainment, Inc.   R
BILOXI CASINO CORP.
  Mississippi corporation     1,250       1,250     Casino Magic Corp.   R
Boomtown, LLC (certificated, elected into UCC Article 8)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R
Brighton Park Maintenance Corp.
  New Jersey corporation     100       100     ACE Gaming, LLC   U
Casino Magic Corp.
  Minnesota corporation     35,000,000       35,000,000     Pinnacle
Entertainment, Inc.   R
Casino Magic (Europe), BV (uncertificated)
  Netherlands corporation     40       40     Casino Magic Corp.   U
Casino Magic Hellas Management Services, SA (uncertificated)
  Greece corporation     10,000       9,999     Casino Magic (Europe), BV   U
Casino Magic Management Services Corp.
  Minnesota corporation     1,000       1,000     Casino Magic Corp.   R, I
Casino Magic Neuquen, SA (uncertificated)
  Argentina     3,917,000       3,917,000     Casino Magic Corp. (3,799,490
shares) and Casino Magic Management Services Corp. (117,510 shares)   U

 

      1  
“R” = Restricted; “U” = Unrestricted; “I” = Immaterial.

 

 

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

 

                                              No.                        
Shares/Units                         Owned by             Jurisdiction of   No.
Shares/Units   Borrower or             Organization,   Issued &   Subsidiary of
      Type of Name   Type of Entity   Outstanding   Borrower   Owner  
Subsidiary1
Casino One Corporation
  Mississippi corporation     100       100     Casino Magic Corp.   R
Double Bogey, LLC (uncertificated)
  Texas LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
Landing Condominium, LLC (uncertificated)
  Missouri LLC     100%       100%     Pinnacle Entertainment, Inc.   U
Louisiana-I Gaming, a Louisiana Partnership in Commendam (uncertificated)
  Louisiana partnership in Commendam     —       —     Boomtown, LLC (5% General
Partnership Interest and 90% Limited Partnership Interest) Pinnacle
Entertainment, Inc. (5% Limited Partnership Interest)   R
Mitre Associates LLC (uncertificated)
  Delaware LLC     100%       100%     PNK Development 13, LLC   U
OGLE HAUS, LLC (uncertificated)
  Indiana LLC     100%       100%     Belterra Resort Indiana, LLC   R, I
Pinnacle Design & Construction, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK (Baton Rouge) Partnership (uncertificated)
  Louisiana partnership     100%       100%     PNK Development 8, LLC (1%)
PNK Development 9, LLC (99%)   R
PNK (BOSSIER CITY), Inc.
  Louisiana corporation     100       100     Casino Magic Corp.   R
PNK (CHILE 1), LLC (certificated, did not elect into UCC Article 8)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK (CHILE 2), LLC (certificated, did not elect into UCC Article 8)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 1, Inc.
  Delaware corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
U

 

- 2 -

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                                              No.                        
Shares/Units                         Owned by             Jurisdiction of   No.
Shares/Units   Borrower or             Organization,   Issued &   Subsidiary of
      Type of Name   Type of Entity   Outstanding   Borrower   Owner  
Subsidiary1
PNK Development 2, Inc.
  Delaware corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
U
PNK Development 3, Inc.
  Delaware corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
U
PNK Development 4, Inc.
  Delaware corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
R, I
PNK Development 5, Inc.
  Delaware corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
R, I
PNK Development 6, Inc.
  Delaware corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
R, I
PNK Development 7, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R
PNK Development 8, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R
PNK Development 9, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R
PNK Development 10, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   U
PNK Development 11, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   U
PNK Development 12, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 13, LLC (uncertificated)
  New Jersey LLC     100%       100%     Biloxi Casino Corp.   U
PNK Development 15, LLC (uncertificated)
  Pennsylvania LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 16, LLC (uncertificated)
  Indiana LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 17, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   U
PNK Development 18, LLC (uncertificated)
  Delaware LLC     100%       100%     PNK Development 11, LLC   U

 

- 3 -

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                                              No.                        
Shares/Units                         Owned by             Jurisdiction of   No.
Shares/Units   Borrower or             Organization,   Issued &   Subsidiary of
      Type of Name   Type of Entity   Outstanding   Borrower   Owner  
Subsidiary1
PNK Development 19, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 20, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 21, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 22, LLC (uncertificated)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 23, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 24, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 25, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 26, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 27, LLC (uncertificated)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK Development 28, LLC (uncertificated)
  Delaware LLC     100%       100%     PNK Development 11, LLC   U
PNK (ES), LLC (certificated, did not elect into UCC Article 8)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R
PNK (EXUMA), LIMITED (certificated, did not elect into UCC Article 8)
  Bahamas corporation     5,000       4,999     Pinnacle Entertainment, Inc.   U
PNK (Kansas), LLC (uncertificated)
  Kansas LLC     100%       100%     PNK Development 17, LLC   U
PNK (LAKE CHARLES), L.L.C. (uncertificated)
  Louisiana LLC     100%       100%     Pinnacle Entertainment, Inc.   R
PNK (Reno), LLC (certificated, elected into UCC Article 8)
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R

 

- 4 -

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                                              No.                        
Shares/Units                         Owned by             Jurisdiction of   No.
Shares/Units   Borrower or             Organization,   Issued &   Subsidiary of
      Type of Name   Type of Entity   Outstanding   Borrower   Owner  
Subsidiary1
PNK (River City), LLC (uncertificated)
  Missouri LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK (SCB), L.L.C.
  Louisiana LLC     100%       100%     PNK Development 7, LLC   R
PNK Scholarship Trust
  Nevada Trust     100%       100%     A Scholarship Trust established by
Pinnacle Entertainment, Inc.   N/A
PNK (ST. LOUIS RE), LLC (certificated, did not elect into UCC Article 8)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I
PNK (STLH), LLC (certificated, did not elect into UCC Article 8)
  Delaware LLC     100%       100%     Pinnacle Entertainment, Inc.   R
Port St. Louis Condominium, LLC (uncertificated)
  Missouri LLC     100%       50%     Landing Condominium, LLC   U
President Riverboat Casino-Missouri, Inc.
  Missouri corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
R
PSW Properties LLC (uncertificated)
  Delaware LLC     100%       100%     Biloxi Casino Corp.   U
Realty Investment Group, Inc.
  Delaware corporation     1,000       1,000     Pinnacle Entertainment, Inc.  
U
Riverside Community Improvement District, Inc.
  Missouri non-profit
corporation     —       —     Non-Profit Corporation formed by Pinnacle
Entertainment, Inc.   N/A
St. Louis Casino Corp.
  Missouri corporation     1,000       1,000     Casino Magic Corp.   R, I
Yankton Investments, LLC
  Nevada LLC     100%       100%     Pinnacle Entertainment, Inc.   R, I

 

- 5 -

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Schedule 4.15 (b)
Pinnacle Entertainment, Inc. has entered into restricted stock agreements under
the Pinnacle Entertainment, Inc. 2005 Equity and Performance Incentive Plan with
Stephen H. Capp (5,000 shares of restricted stock), John A. Godfrey (5,000
shares of restricted stock), Alain Uboldi (5,000 shares of restricted stock),
and Clifford D. Kortman (5,000 shares of restricted stock) regarding grants of
restricted stock granted on October 6, 2006.  Pinnacle Entertainment, Inc. also
entered into restricted stock agreements with Daniel R. Lee (15,000 shares of
restricted stock) and Wade Hundley (10,000 shares of restricted stock), who are
no longer with the Company and whose shares of restricted stock either have
vested or have been cancelled. 
Pinnacle Entertainment, Inc. has granted each of the directors 681 and 728
phantom stock units in May 2008 and 2009, respectively, which convert on a
one-for-one basis into the common stock of Pinnacle Entertainment, Inc. if the
director ceases being a director for any reason.  The phantom stock units were
granted under the 2005 Equity and Performance Incentive Plan.  Pinnacle
Entertainment, Inc. grants each director $10,000 worth of phantom stocks
annually as part of the director’s annual retainer.  Pinnacle Entertainment,
Inc. has entered into grants of other stock unit awards to reflect the grant of
the phantom stock units to each of the directors. 
Pinnacle Entertainment, Inc. has also established the 2008 Amended and Restated
Pinnacle Entertainment, Inc. Directors Deferred Compensation Plan, the Directors
Plan, which is limited to directors of Pinnacle, and each eligible director may
elect to defer all or a portion of his annual retainer (other than the $10,000
in phantom stock units discussed above) and any fees for meetings attended.  Any
such deferred compensation is credited to a deferred compensation account,
either in cash or in shares of Pinnacle Common Stock, at each director’s
election. The only condition to each director’s receipt of shares credited to
his deferred compensation account is cessation of such director’s service as a
director of Pinnacle.   

 

 

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

 

Schedule 4.19(a)
UCC Financing Statements Filing Jurisdictions

              Name   Jurisdiction
1.
  Belterra Resort Indiana, LLC   Nevada (state of formation – file with SOS)
2.
  BILOXI CASINO CORP.   Mississippi (state of formation – file with SOS)
3.
  Boomtown, LLC   Delaware (state of formation – file with SOS)
4.
  Casino Magic Corp.   Minnesota (state of formation – file with SOS)
5.
  Casino One Corporation   Mississippi (state of formation – file with SOS)
6.
  Louisiana-I Gaming, a
Louisiana Partnership in
Commendam   Louisiana (state of formation – file with Jefferson Parish)
7.
  OGLE HAUS, LLC   Indiana (state of formation – file with SOS)
8.
  Pinnacle Entertainment, Inc.   Delaware (state of formation – file with SOS)
9.
  PNK (Baton Rouge) Partnership   Louisiana (state of formation – file with
Calcasieu Parish)
10.
  PNK (BOSSIER CITY), INC.   Louisiana (state of formation – file with Bossier
Parish)
11.
  PNK (CHILE 1), LLC   Delaware (state of formation – file with SOS)
12.
  PNK (CHILE 2), LLC   Delaware (state of formation – file with SOS)
13.
  PNK (ES), LLC   Delaware (state of formation – file with SOS)
14.
  PNK (LAKE CHARLES), L.L.C.   Louisiana (state of formation – file with
Calcasieu Parish)

 

 

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

 

              Name   Jurisdiction
15.
  PNK (Reno), LLC   Nevada (state of formation – file with SOS)
16.
  PNK (SCB), L.L.C.   Louisiana (state of formation – file with Calcasieu
Parish)
17.
  PNK (ST. LOUIS RE), LLC   Delaware (state of formation – file with SOS)
18.
  PNK (STLH), LLC   Delaware (state of formation – file with SOS)
19.
  PNK Development 7, LLC   Delaware (state of formation – file with SOS)
20.
  PNK Development 8, LLC   Delaware (state of formation – file with SOS)
21.
  PNK Development 9, LLC   Delaware (state of formation – file with SOS)
22.
  President Riverboat Casino-Missouri, Inc.   Missouri (state of formation –
file with SOS)
23.
  St. Louis Casino Corp.   Missouri (state of formation – file with SOS)
24.
  Yankton Investments, LLC   Nevada (state of formation – file with SOS)

 

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Schedule 4.19(b)
Amendments to the Mortgages covering the following properties:

              Description of Property   Mortgage Filing Jurisdiction
1.
  River City Property   Official Records of the County of St. Louis, Missouri
2.
  Lumière Property   Official Records of the City of St. Louis, Missouri
3.
  Property (fee) located at 901 and 925 N. First Street in St. Louis, Missouri
63102   Official Records of the City of St. Louis, Missouri
4.
  Property (19 parcels) (fee) located in St. Louis, Missouri, owned by PNK (ST.
LOUIS RE), LLC.   Official Records of the City of St. Louis, Missouri
5.
  Property (fee) located in St. Louis, Missouri, owned by Pinnacle
Entertainment, Inc. (Cherrick’s subdivision)   Official Records of the City of
St. Louis, Missouri
6.
  Property (leasehold interest) located in St. Louis, Missouri, leased by
President Riverboat Casino-Missouri, Inc. (Mooring Points)   Official Records of
the City of St. Louis, Missouri
7.
  Property (fee) located in Central City, Colorado, owned by Pinnacle
Entertainment, Inc.   Official Records of Gilpin County, Colorado

 

 

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Schedule 7.2(d)
List of Existing Indebtedness

                                                                             
Amount                                       Outstanding as                    
  Original     Maturity     of   Obligor   Beneficiary     Interest Rate    
Balance     Date     1/01/10  
OGLE HAUS, LLC
  Peoples Trust Company     8.00 %   $ 1,402,044     May 2017   $ 749,874  

Lease and Development Agreement dated as of August 12, 2004 by and between the
St. Louis County Port Authority and Pinnacle Entertainment, Inc., as amended by
that Letter Agreement dated as of August 12, 2004 by and between the St. Louis
County Port Authority and Pinnacle Entertainment, Inc., as amended by that
Second Amendment to Lease and Development Agreement dated as of October 7, 2005
by and between St. Louis County Port Authority and Pinnacle Entertainment, Inc.,
as amended by that Third Amendment to Lease and Development Agreement dated as
of August 11, 2006 by and between the St. Louis County Port Authority and
Pinnacle Entertainment, Inc. as amended by that Fourth Amendment to Lease and
Development Agreement dated as of January 18, 2007 by and between the St. Louis
County Port Authority and Pinnacle Entertainment, Inc. as amended by that Fifth
Amendment to Lease and Development Agreement dated as of March 30, 2007 by and
between St. Louis County Port Authority and Pinnacle Entertainment, Inc. as
amended by that Sixth Amendment to Lease and Development Agreement dated
November 26, 2007 by and between the St. Louis County Port Authority and
Pinnacle Entertainment, Inc. Pursuant to the Lease and Development Agreement, we
have a long term deferred rent obligation in the amount of $16,514,197 as of
December 31, 2009.
Guaranty Agreement, dated August 19, 2002, by Pinnacle Entertainment, Inc., as
Guarantor to Lake Charles Harbor & Terminal District with respect to obligations
by PNK (LAKE CHARLES), L.L.C.
Guaranty Agreement, effective as of August 1, 2007, by Pinnacle Entertainment,
Inc., as Guarantor to Lake Charles Harbor & Terminal District with respect to
the obligations of PNK (LAKE CHARLES), L.L.C.

 

 

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

 

Schedule 7.3(f)
Existing Liens
Real Estate Mortgage, Security Agreement, Assignment of Account and Assignment
of Liquor License each executed by OGLE HAUS, LLC in favor of People Trust
Company, an Indiana State bank.
Cash collateral for Pinnacle Entertainment, Inc.’ guarantee obligations under
the letter of credit issued by Bank of America Mutual Funds Services.
Certain licenses granted in connection with sale of Casino Magic Bay St. Louis
and Boomtown Biloxi, as follows:
a) Pursuant to that certain Asset Purchase Agreement between Casino Magic Corp.,
a Minnesota corporation, and BSL, Inc., a Mississippi corporation, dated as of
December 9, 1999 (as amended), Casino Magic Corp. sold to BSL, Inc. certain real
and personal property, tangible and intangible, used by Casino Magic Corp. in
the operation of the Casino Magic casino located in Bay St. Louis, Mississippi.
In connection with such sale, Casino Magic Corp. and BSL, Inc. entered into a
License Agreement on August 8, 2000, pursuant to which Casino Magic Corp.
granted a nonexclusive, royalty-free, perpetual license to use certain marks and
certain additional marks (as more particularly described in Schedule 1 to the
License Agreement) in connection with casino operations with all ancillary goods
and services.
b) Pursuant to that certain Asset Purchase Agreement between Boomtown, Inc., a
Delaware corporation, and BTN, Inc., a Mississippi corporation, dated as of
December 9, 1999 (as amended), Boomtown, Inc. sold to BTN, Inc. certain real and
personal property, tangible and intangible, used by Boomtown, Inc. in the
operation of the Boomtown Biloxi casino located in Biloxi, Mississippi. In
connection with such sale, Boomtown, Inc. and BTN, Inc. entered into a License
Agreement on August 8, 2000, pursuant to which Boomtown, Inc. granted a
nonexclusive, royalty-free, perpetual license to use certain marks and certain
additional marks (as more particularly described in Schedule 1 to the License
Agreement) in connection with casino operations with all ancillary goods and
services.
Security Interest Assignment in “Boomtown” mark: from BSL, Inc. to Deutsche Bank
Trust Company, recorded with the Patent and Trademark Office on October 3, 2005
at Reel 3175 Frame 0228.
Security Interest Assignment in “Boomtown” mark: from BTN, Inc. to Deutsche Bank
Trust Company, recorded with the Patent and Trademark Office on October 3, 2005
at Reel 3175 Frame 0228.

 

- 1 -

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Inter-Company Assignments and Licenses listed on Schedule 2 attached to the
Second Amended and Restated Trademark Collateral Assignment dated as of
December 14, 2005, as has been amended and supplemented through the Effective
Date, including, the amendment effected pursuant to that certain Omnibus
Amendment and Ratification dated as of the Effective Date.
The Grantor Trust Agreement to be entered into by Pinnacle Entertainment, Inc.
and the Trustee named therein, with respect to matters regarding the former
chief executive officer of Pinnacle Entertainment, Inc.; it being acknowledged
and agreed that as of the Effective Date such Grantor Trust Agreement is not
executed but upon execution it shall constitute an existing Lien for all
purposes under the Credit Agreement.
Directors and Officers Trust presently with Wilmington Trust Company providing
for indemnification of officers and directors of the Borrower, as such trust may
be amended, amended and restated, substituted or replaced from time to time.
Judgment No. 19972-03150 against President Riverboat Casino Missouri in favor of
Helena Maria Brownyard in the amount of $1,850,000 abstracted April 18, 2001

 

- 2 -

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Existing Liens (Continued)

                          Debtor   Secured Party   Jurisdiction   File Date  
File Number   Type of Filing
Belterra Resort Indiana, LLC
  American Express Business Finance Corporation   Nevada SOS   8/6/2003    
2003021142-3     Original
Belterra Resort Indiana, LLC
  American Express Business Finance Corporation   Nevada SOS   5/9/2008    
2008015102-1     Continuation of 2003021142-3
Belterra Resort Indiana, LLC
  Atlantic City Coin and Slot Service Company   Nevada SOS   3/23/2006    
2006009234-8     Original
Belterra Resort Indiana, LLC
  Advantage Financial Services, LLC   Nevada SOS   2/15/2007     2007004965-4  
  Original
Belterra Resort Indiana, LLC
  Advantage Financial Services, LLC   Nevada SOS   4/9/2007     2007011172-2    
Amendment of 2007004965-4
Belterra Resort Indiana, LLC
  House of Taylor Jewelry, Inc.   Nevada SOS   9/25/2007     2007031488-5    
Original
Casino One Corporation
  Aristocrat Technologies, Inc.   Mississippi SOS   6/26/2009     20090123837G  
  Original
Louisiana-I Gaming, a Louisiana Partnership in Commendam
  Shuffle Master Inc. (lessor)   Caddo Parish   11/22/2004     09-1038476    
Original
Louisiana-I Gaming, a Louisiana Partnership in Commendam
  Shuffle Master Inc. (lessor)   Caddo Parish   2/3/2005     09-1040578    
Original
Louisiana-I Gaming, a Louisiana Partnership in Commendam
  Citicorp. Vendor Finance, Inc.   Caddo Parish   3/28/2006     09-1056072    
Original
Louisiana-I Gaming, a Louisiana Partnership in Commendam
  Shuffle Master Inc. (lessor)   Jefferson Parish   2/7/2008     26-300160    
Original
Louisiana-I Gaming, a Louisiana Partnership in Commendam
  WMS Gaming, Inc.   Jefferson Parish   10/1/2008     26-303932     Original

 

- 3 -

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                          Debtor   Secured Party   Jurisdiction   File Date  
File Number   Type of Filing
Louisiana-I Gaming, a Louisiana Partnership in Commendam
  Aristocrat Technologies, Inc.   Caddo Parish   9/23/2009     09-1121114    
Original
Pinnacle Entertainment, Inc.
  Bally Gaming and Systems   Delaware SOS   11/3/2003     32878901     Original
Pinnacle Entertainment, Inc.
  Bally Gaming and Systems   Delaware SOS   12/30/2003     33424432    
Amendment of 32878901
Pinnacle Entertainment, Inc.
  Bally Gaming and Systems   Delaware SOS   4/8/2005     51092049     Amendment
of 51524165
Pinnacle Entertainment, Inc.
  Bally Gaming and Systems   Delaware SOS   7/18/2005     52201557     Amendment
of 51524165
Pinnacle Entertainment, Inc.
  Shuffle Master, Inc.   Delaware SOS   6/3/2008     81886553     Original
Pinnacle Entertainment, Inc.
  Henriksen/Butler Design Group   Delaware SOS   4/29/2009     91347100    
Original
Pinnacle Entertainment, Inc.
  Konami Gaming, Inc.   Delaware SOS   8/17/2009     92629712     Original
Pinnacle Entertainment, Inc.
  Henriksen/Butler Design Group   Delaware SOS   10/22/2009     93394373    
Original
PNK (BOSSIER CITY), Inc.
  WMS Gaming, Inc.   Caddo Parish   9/17/2008     09-1102434     Original
PNK (LAKE CHARLES), L.L.C.
  WMS Gaming, Inc.   Calcasieu Parish   11/9/2005     10-34393     Original
PNK (LAKE CHARLES), L.L.C.
  US Express Leasing, Inc.   Caddo Parish   11/29/2006     09-1068083    
Original
PNK (LAKE CHARLES), L.L.C.
  Textron Financial Corporation   Caddo Parish   8/8/2007     09-1080964    
Original
PNK (RENO), LLC
  WMS Gaming, Inc.   Nevada SOS   8/27/2009     2009021042-3     Original
President Riverboat Casino-Missouri, Inc.
  WMS Gaming, Inc.   Missouri SOS   9/17/2008     2008010224A     Original

 

- 4 -

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Schedule 7.5(g)
List of Designated Assets

      Description of Asset   Location
All owned and leased Property related to the PRC-MO Property, including but not
limited to the lease and sublease with the City of St. Louis and The Port
Authority of the City of St. Louis
  Missouri
Ownership interest in ODS Technologies, L.P. and all rights, title and interest
in and to that certain Investment Agreement, dated July 30, 1997, between ODS
Technologies, L.P. and Pinnacle Entertainment, Inc, as amended and any other
agreement related to Pinnacle Entertainment, Inc.’s ownership interest in ODS
Technologies, L.P.
  N/A
 
       
St. Louis City Owned Property (Parking)
  Missouri
 
       
806-808 North 1st Street (Parking)
   
St. Louis City Owned Property (HoteLumiere) 901 N. First Street
  Missouri
 
       
St. Louis City Owned Properties (Parking)
  Missouri
 
       
920 N. First Street
   
925 N. First Street
   
928 N. First Street
   
930 N. First Street
   
934 N. First Street
   
942 N. First Street
   
900 N. First Street
   
914 N. First Street
   
 
   
1016 N. First Street
   
1020 N. First Street
   
1024 N. First Street
   
1012 N. First Street
   
1004 N. First Street
   
1000 N. First Street
   
1028 N. First Street
   

 

 

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

 

      Description of Asset   Location
St. Louis City Owned Properties (Parking for President Casino)
  Missouri
 
   
1005 N. Wharf Street
   
901 N. Wharf Street
   
1003 N. Wharf
   
1030R N. Commercial Street
   
1030 N. Commercial Street
   
St. Louis City Owned Properties (Condo Development)
  Missouri
 
   
807 N. Leonor K. Sullivan Blvd.
   
805 N. Leonor K. Sullivan Boulevard
   
803 N. Leonor K. Sullivan Boulevard
   
1 Morgan Street
   
St. Louis City Leased Property (Sligo Warehouse)
  Missouri
 
       
1100 N. 2nd Street
   
St. Louis City Leased Property (Office Building)
  Missouri
 
       
727 North First Street (5th Floor) and any leased portion of the 6th floor
   
St. Louis County Properties
  Missouri
 
       
8021 Zellie
   
 
       
8019 Zellie
   
Warehouse leased in connection with the River City Property
  Missouri
Boomtown Hotel and Casino (fee, including water rights) located at 2100 I-80
West (I-80 at Boomtown), Reno, Nevada 89439
  Nevada
Approximately 500 acres of excess (non-operating) land adjacent to the Boomtown
Hotel and Casino in Reno, Nevada, and any water rights appurtenant thereto
  Nevada
Approximately 296 acres of excess undeveloped land in the mountains outside
Reno, Nevada, and any water rights appurtenant thereto
  Nevada
Excess (non-operating) and excess undeveloped land near the Boomtown Casino in
New Orleans, Louisiana
  Louisiana
Real Property and Improvements acquired from Harrah’s, located in Lake Charles,
Louisiana
  Louisiana

 

- 2 -

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      Description of Asset   Location
Leasehold interest pursuant to the Ground Lease with the Lake Charles Harbor &
Terminal District and PNK (Lake Charles), L.L.C. in Lake Charles, Louisiana
(Sugarcane Bay Project)
  Louisiana
Real Property in Lake Charles, Louisiana, purchased and/or to be purchased
pursuant to the Ground Lease with the Lake Charles Harbor & Terminal District
and PNK (Lake Charles), L.L.C. (Sugarcane Bay Project)
  Louisiana
Remainder of four parcels (fee) purchased from Richard, Sittig, Connor, and
Hatchett in Lake Charles, Louisiana
  Louisiana
Approximately 56 acres of Real Property in Lake Charles, Louisiana (Cline Canal
Tract) purchased from Bailey, Verret, Vail Rigler, Chesson, Schoolsky, Queenan,
Chesson, Bodin and Robichaux in various transactions in 2007.
  Louisiana
Excess (non-operating) and excess undeveloped land in Baton Rouge, Louisiana
  Louisiana
The single family dwelling at 3801 Burgoyne St., Lake Charles, Louisiana, 70605
  Louisiana
Excess (non-operating) and excess undeveloped land at Boomtown Bossier City
  Louisiana
Undeveloped land in Central City, Colorado
  Colorado
The Ogle Haus at Belterra Casino Resort
  Indiana
Excess (non-operating) and excess undeveloped land at Belterra Casino Resort
  Indiana
Equity interests in any Restricted Subsidiary, the sole assets of which are
listed on this Schedule 7.5(g)
  N/A
Remainder of property following a Disposition of a portion of such property
permitted by Section 7.5(o) of the Agreement
  N/A

 

- 3 -

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

 

Schedule 7.7(d)
List of Existing Investments
Description of Investments

1.  
Investments in Unrestricted Subsidiaries listed in Schedule 4.15 to the Credit
Agreement
  2.  
Investment in ODS Technologies, L.P. and all rights, title and interest in and
to that certain Investment Agreement, dated July 30, 1997, between ODS
Technologies, L.P. and Pinnacle Entertainment, Inc., as successor to Hollywood
Park, Inc.
  3.  
Investments made in ODS Technologies, L.P. pursuant to that certain Limited
Partnership Agreement of ODS Technologies, L.P. dated March 17, 1994
  4.  
Note Receivable from Switzerland County Natural Gas Company in the approximate
principal amount of $1,800,000.

 

 

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EXHIBIT A
FORM OF COMPLIANCE CERTIFICATE
This Compliance Certificate is delivered to you pursuant to Section 6.2(b) of
the Third Amended and Restated Credit Agreement, dated as of February _____,
2010 (as amended, restated, amended and restated, supplemented, replaced or
modified from time to time, the “Credit Agreement”), among PINNACLE
ENTERTAINMENT, INC., a Delaware corporation (the “Borrower”), the several banks
and other financial institutions or entities from time to time parties to the
Credit Agreement, BANC OF AMERICA SECURITIES LLC AND JPMORGAN SECURITIES, INC.,
as joint lead arrangers and joint book runners and BARCLAYS BANK PLC, as
administrative agent. Capitalized terms used but not defined herein shall have
the meanings given to such terms in the Credit Agreement.
1. I am the duly elected, qualified and acting chief financial officer of the
Borrower.
2. I have reviewed and am familiar with the contents of this Certificate.
3. I have reviewed the terms of the Credit Agreement and the other Loan
Documents and have made, or caused to be made under my supervision, a review in
reasonable detail of the transactions and condition of the Borrower and its
Restricted Subsidiaries during the accounting period covered by the financial
statements attached hereto as Attachment 1 (the “Financial Statements”). Such
review did not disclose the existence during or at the end of the accounting
period covered by the Financial Statements, and I have no knowledge of the
existence, as of the date of this Certificate, of any condition or event which
constitutes a Default or Event of Default, except as previously disclosed to the
Administrative Agent pursuant to Section 6.7(a) or as set forth below.
4. Attached hereto as Attachment 2 are the computations showing compliance with
the covenants in the Credit Agreement identified in such attachment.
IN WITNESS WHEREOF, I execute this Certificate this                      day of
                    , 20_____.

                 
 
                    PINNACLE ENTERTAINMENT, INC., a Delaware corporation    
 
               
 
  By:                          
 
      Name:        
 
      Title:  
 
   
 
         
 
   

 

 

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ATTACHMENT 2
The information described herein is as of                      _____, 20_____
(the “Certification Date”), and pertains to the period from                     
_____, 20_____ to                      _____, 20_____.

I.  
FINANCIAL CONDITION COVENANTS

  A.  
Consolidated EBITDA:

                          Quarter   Quarter   Quarter   Quarter         Ending  
Ending   Ending   Ending         [___]   [___]   [___]   [___]   TOTAL
Consolidated Net Income of the Borrower and its Restricted Subsidiaries
                   
 
                   
Plus:
                   
income tax expense
                   
Consolidated Interest Expense of the Borrower and its Restricted Subsidiaries,
amortization or writeoff of debt discount and debt issuance costs and
commissions, discounts and other fees and charges associated with Indebtedness
                   
depreciation and amortization expense
                   
amortization and write-off of intangibles (including, but not limited to,
goodwill) and organization costs
                   
any extraordinary, unusual or non-recurring expenses or losses (including,
whether or not otherwise includable as a separate item in the statement of such
                   

 

 

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

 

                          Quarter   Quarter   Quarter   Quarter         Ending  
Ending   Ending   Ending         [___]   [___]   [___]   [___]   TOTAL
Consolidated Net Income for such period, losses on sales of assets outside of
the ordinary course of business)
                   
pre-opening and related promotional expenses incurred in connection with any
Project
                   
any other non-cash charges
                   
any amount expended after January 1, 2010 towards the development of businesses
not prohibited by Section 7.l4, in an amount not to exceed $2,500,000 in any
fiscal year
                   
 
                   
minus:
                   
 
       
the sum of:
                   
 
       
interest income (except to the extent deducted in determining Consolidated
Interest Expense)
                   
any extraordinary, unusual or non-recurring income or gains (including, whether
or not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, gains on sales of assets outside of the
ordinary course of business, but not including business interruption insurance
proceeds)
                   
any other non-cash income
                   
 
                   
TOTAL CONSOLIDATED EBITDA
                   

 

 

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

 

         
B. Annualized Adjusted EBITDA:
       
1. Consolidated EBITDA:
  $                     ,  
2. To the extent deducted in arriving at Consolidated EBITDA for such period,
non-cash write downs to goodwill required by Financial Accounting Standards
Board Statement No. 142, and any non-cash reductions to the value of the assets
of the Borrower and its Restricted Subsidiaries required by Financial Accounting
Standards Board Statement No. 121 or No. 144:
  $                     ,  
3. The Foreign Subsidiary Receipts that were (x) received during such period by
the Borrower or any Restricted Subsidiary and (y) irrevocably designated during
such period as Reclassified Foreign Subsidiary Receipts:
  $                     ,  
 
       
Annualized Adjusted EBITDA:
  $                       
 
       
C. Consolidated Total Leverage Ratio. Consolidated Total Leverage Ratio on a
consolidated basis of Borrower as of the last day of the consecutive
four-fiscal-quarter period from                     , ___ through
                    ,                     .
       
1. Consolidated Total Debt of the Borrower and its Restricted Subsidiaries
(aggregate principal amount of all Indebtedness) less Excess Cash:
  $                     .  
2. Annualized Adjusted EBITDA (from Item B)
  $                       
3. Consolidated Total Leverage Ratio (C.1. divided by C.2):                     
       
4. Maximum permitted Consolidated Total Leverage Ratio:
       

 

 

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

 

              Consolidated Total   Fiscal Quarter Ending   Leverage Ratio  
March 31, 2010
    7.60 to 1.00  
June 30, 2010
    7.60 to 1.00  
September 30, 2010
    7.60 to 1.00  
December 31, 2010
    7.60 to 1.00  
March 31, 2011
    7.50 to 1.00  
June 30, 2011
    7.50 to 1.00  
September 30, 2011
    7.25 to 1.00  
December 31,2011
    7.25 to 1.00  
March 31, 2012
    7.00 to 1.00  
June 30, 2012
    6.75 to 1.00  
September 30, 2012
    6.25 to 1.00  
December 31, 2012
    6.00 to 1.00  
March 31, 2013
    5.75 to 1.00  
June 30, 2013
    5.25 to 1.00  
September 30, 2013
    5.00 to 1.00  
December 31, 2013
    4.75 to 1.00  
March 31, 2014
    4.75 to 1.00  

         
D. Consolidated Interest Coverage Ratio. Consolidated Interest Coverage Ratio of
Borrower for the four-fiscal-quarter period from                     , ____
through                     ,                     .
       
1. Annualized Adjusted EBITDA (from Item B):
  $                       
2. the Aggregate amount of Consolidated Interest Expense:
  $                       
3. Consolidated Interest Coverage Ratio (D.1 divided by D.2):
                    
       
4. Minimum permitted Consolidated Interest Coverage Ratio:
       

              Minimum Consolidated   Fiscal Quarter Ending   Interest Coverage
Ratio  
March 31, 2010
    1.50 to 1.00  
June 30, 2010
    1.50 to 1.00  
September 30, 2010
    1.50 to 1.00  
December 31, 2010
    1.50 to 1.00  
March 31, 2011
    1.50 to 1.00  
June 30, 2011
    1.50 to 1.00  

 

 

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

 

              Minimum Consolidated   Fiscal Quarter Ending   Interest Coverage
Ratio  
September 30, 2011
    1.50 to 1.00  
December 31, 2011
    1.50 to 1.00  
March 31, 2012
    1.50 to 1.00  
June 30, 2012
    1.60 to 1.00  
September 30, 2012
    1.65 to 1.00  
December 31, 2012
    1.75 to 1.00  
March 31, 2013
    1.75 to 1.00  
June 30, 2013
    1.90 to 1.00  
September 30, 2013
    2.00 to 1.00  
December 31, 2013
    2.00 to 1.00  
March 31, 2014
    2.00 to 1.00  

         
E. Consolidated Senior Secured Debt Ratio. Consolidated Senior Secured Debt
Ratio as of the last day of any four consecutive fiscal quarter period from
                    , ____ through                     ,                     .
       
1. Consolidated Senior Secured Debt less Excess Cash:
  $                       
2. Annualized Adjusted EBITDA (from Item B):
  $                       
3. Consolidated Senior Secured Debt Ratio (E.1. divided by E.2.):
                    
       
4. Maximum permitted Consolidated Senior Secured Debt Ratio:
    2.50 to 1.00.  
 
       
II. indebtedness
       
 
       
A. Aggregate Indebtedness (including, without limitation, Capital Lease
Obligations) secured by Liens permitted by Section 7.3(g) at any one time
outstanding (Section 7.2(c)(i)):
  $                       
B. Aggregate Indebtedness of any and all Persons that became a direct or
indirect Subsidiary of the Borrower after the Effective Date in an acquisition
(Section 7.2(c)(ii)):
  $                       
C. Aggregate amount of Indebtedness described in II.A. and II.B:
  $                      1

 

      1  
Shall not exceed $50,000,000 at any one time outstanding.

 

 

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

 

         
D. Aggregate Indebtedness incurred in the form of Guarantee Obligations with
respect to commercial letters of credit at any one time outstanding under
Section 7.2(i)(x):
  $                      2
E. Indebtedness incurred pursuant to Section 4.21.3 of the Redevelopment
Agreement in an aggregate principal amount not to exceed $10,000,000 at any one
time outstanding:
  $                      3
F. Aggregate Indebtedness permitted under Section 7.2(m) in connection with the
purchase, equipping, furnishing and/or refurbishing of one or more aircraft:
  $                      4
G. Aggregate Indebtedness permitted under Section 7.2(n):
  $                      5
 
       
III. INVESTMENTS
       
 
       
A. Aggregate amount of loans and advances to employees of the Borrower or any
Restricted Subsidiaries in the ordinary course of business permitted under
Section 7.7(e):
  $                      6
B. Aggregate amount of Investments permitted under Section 7.7(k):
  $                      7
C. Aggregate amount of Investments permitted under Section 7.7(n):
  $                      8
 
       
IV. CAPITAL EXPENDITURES
       
A. Maintenance Capital Expenditures Amount:
  $                      9

 

      2  
Shall not exceed $25,000,000 at any one time outstanding.
  3  
Shall not exceed $10,000,000 at any one time outstanding.
  4  
Shall not exceed $20,000,000 at any one time outstanding.
  5  
Shall not exceed $900,000,000 at any one time outstanding unless Consolidated
Total Leverage Ratio is less than 6.00 to 1.00.
  6  
Shall not exceed $5,000,000 at any one time outstanding.
  7  
Shall not exceed (i) $100,000,000 plus (ii) an amount (but not less than zero)
equal to the lesser of (x) 50% of the New Capital Adjusted Proceeds minus
$100,000,000 and (y) the New Capital Adjusted Proceeds minus the amount thereof
that has been applied for Capital Expenditures pursuant to Section 7.16(c) minus
$100,000,000.
  8  
Shall not exceed $10,000,000 at any one time outstanding.

 

 

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

 

         
B. Capital Expenditures associated with Phase I of the River City Property
Project:
  $                      10
C. Capital Expenditures associated with Phase II of the River City Property
Project:
  $                      11
D. Capital Expenditures associated with the Sugarcane Bay Project:
  $                      12
E. Capital Expenditures associated with the Baton Rouge Project:
  $                      13
F. Capital Expenditures associated with the renovation of the PRC-MO Property
Project:
  $                      14
G. Capital Expenditures associated with the development of Phase II of the
Lumiere Property Project:
  $                      15

 

      9  
Shall not exceed the amount up to 6.00% of Consolidated Revenues of the Borrower
and its Subsidiaries for the immediately preceding fiscal year, plus any
Maintenance Capital Expenditures not expended in the immediately preceding
fiscal year (but such increase may not be carried forward to any subsequent
fiscal year).
  10  
Shall not exceed $63,000,000.
  11  
Shall not exceed $85,000,000.
  12  
Shall not exceed $238,000,000.
  13  
Shall not exceed $235,000,000.
  14  
Shall not exceed $15,000,000.
  15  
Shall not exceed $55,000,000.

 

 

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

 

         
H. Capital Expenditures not in excess of $50,000,000 plus (i) for the first
quarter of fiscal year 2010, 35.0% of Annualized Adjusted EBITDA of the Borrower
and its Restricted Subsidiaries for the first quarter of fiscal year 2010;
(ii) for the two-fiscal quarter period ending on June 30, 2010, 35.0% of
Annualized Adjusted EBITDA of the Borrower and its Restricted Subsidiaries for
the first two quarters of fiscal year 2010, (iii) for the three-fiscal quarter
period ending on September 30, 2010, 35.0% of Annualized Adjusted EBITDA of the
Borrower and its Restricted Subsidiaries for the first three quarters of fiscal
year 2010, (iv) for the four-fiscal quarter period ending on December 31, 2010,
35.0% of Annualized Adjusted EBITDA of the Borrower for fiscal year 2010, and
(v) for any four fiscal quarter period ending thereafter, 35.0% of Annualized
Adjusted EBITDA of the Borrower and its Restricted Subsidiaries.
  $                       
I. New Capital Adjusted Proceeds minus $100,000,000, minus the amount thereof
representing outstanding Investments made pursuant to Section 7.7(k):
  $                       
J. New Capital Asset Disposition Proceeds less any amount of such Assets
Disposition Proceeds applied or required to be applied to prepay Incremental
Term Loans and/or Revolving Credit Loans with a corresponding reduction in the
Revolving Credit Commitments:
  $                       
 
       
V. CONSTRUCTION COVENANTS
       
A. Funds applied to the Expenses for the Baton Rouge Project on and after
January 1, 2010:
  $                      16

 

      16  
May not be more than $25,000,000 until the Borrower shall have received New
Capital Available Proceeds in an amount equal to or greater than $100,000,000

 

 

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

 

EXHIBIT B-1
FORM OF LENDER ADDENDUM
Reference is made to that certain Third Amended and Restated Credit Agreement,
dated as of February _____, 2010 (as the same may be further amended, restated,
amended and restated, supplemented, replaced or otherwise modified from time to
time, the “Credit Agreement”), among PINNACLE ENTERTAINMENT, INC., a Delaware
corporation (the “Borrower”), the several banks and other financial institutions
or entities from time to time parties thereto, BANC OF AMERICA SECURITIES LLC
AND JPMORGAN SECURITIES, INC., as Joint Lead Arrangers and Joint Book Runners,
and BARCLAYS BANK PLC, as administrative agent. Unless otherwise defined herein,
terms defined in the Credit Agreement and used herein shall have the meanings
given to them in the Credit Agreement.
Upon execution and delivery of this Lender Addendum by the parties hereto as
provided in Section 10.17 of the Credit Agreement, the undersigned hereby
becomes a Lender thereunder having the Commitments set forth in Schedule 1
hereto, effective as of the Effective Date.
THIS LENDER ADDENDUM SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
This Lender Addendum may be executed by one or more of the parties hereto on any
number of separate counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument. Delivery of an
executed signature page hereof by facsimile transmission shall be effective as
delivery of a manually executed counterpart hereof.
[Signature page to follow]

 

 

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

 

IN WITNESS WHEREOF, the parties hereto have caused this Lender Addendum to be
duly executed and delivered by their proper and duly authorized officers as of
this _____ day of                     , 20_____.

                 
 
                   
[                                                                          ]    
 
               
 
  By:                          
 
      Name:        
 
      Title:  
 
   
 
         
 
   

          Accepted and agreed:    
 
        PINNACLE ENTERTAINMENT, INC., a Delaware corporation    
 
       
By: 
     
 
Name: 
 
   
 
Title: 
 
   
 
 
 
   
 
        BARCLAYS BANK PLC, as
Administrative Agent    
 
       
By: 
     
 
Name: 
 
   
 
Title: 
 
   
 
 
 
   

 

 

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

 

COMMITMENTS AND NOTICE ADDRESS

         
 
       
1. Name of Lender:
       
     Notice Address:
 
 
   
 
 
 
   
 
 
 
   
 
 
 
   
     Attention:
       
     Telephone:
 
 
   
     Facsimile:
 
 
   
 
 
 
   
 
        2. Revolving Credit Commitment:    
 
        3. L/C Commitment:    
 
        4. Swing Line Commitment:    

 

 

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

 

EXHIBIT B-2
FORM OF NEW LENDER SUPPLEMENT
This NEW LENDER SUPPLEMENT, dated as of                     , 20_____ (this “New
Lender Supplement”), to the Third Amended and Restated Credit Agreement dated as
of February  _____, 2010 (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”) among PINNACLE
ENTERTAINMENT, INC., a Delaware corporation (the “Borrower”), the several banks
and other financial institutions or entities from time to time parties to this
Agreement (the “Lenders”), BANC OF AMERICA SECURITIES LLC AND JPMORGAN
SECURITIES, INC., as Joint Lead Arrangers and Joint Book Runners, and BARCLAYS
BANK PLC, as administrative agent (the “Administrative Agent”).
WITNESSETH:
WHEREAS, the Credit Agreement provides in Section 2.8(d) thereof that any bank,
financial institution or other entity may become a party to the Credit Agreement
with the consent of the Borrower and the Administrative Agent (which consent, in
the case of the Administrative Agent, shall not be unreasonably withheld) by
executing and delivering to the Borrower and the Administrative Agent a
supplement to the Credit Agreement in substantially the form of this New Lender
Supplement; and
WHEREAS, the undersigned now desires to become a party to the Credit Agreement;
NOW, THEREFORE, the undersigned hereby agrees as follows:
1. The undersigned agrees to be bound by the provisions of the Credit Agreement,
and agrees that it shall, on the date this New Lender Supplement is accepted by
the Borrower and the Administrative Agent, become a Lender for all purposes of
the Credit Agreement to the same extent as if originally a party thereto, with
[an Incremental Revolving Credit (Commitment)(Loans) of $                    ]
[Incremental Term Loans of $                    ] [Incremental Delayed Draw Term
(Commitment) (Loans) of $                    ].
2. The undersigned (a) represents and warrants that it is legally authorized to
enter into this New Lender Supplement; (b) confirms that it has received a copy
of the Credit Agreement, together with copies of the financial statements
referred to in Section 4.1 and Section 6.1 thereof, and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this New Lender Supplement; (c) agrees that it has made
and will, independently and without reliance upon Administrative Agent or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement or any instrument or document
furnished pursuant hereto or thereto; (d) appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Credit Agreement or any instrument or
document furnished pursuant hereto or thereto as are

 

 

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

 

delegated to the Administrative Agent by the terms thereof, together with such
powers as are incidental thereto; and (e) agrees that it will be bound by the
provisions of the Credit Agreement and will perform in accordance with its terms
all the obligations which by the terms of the Credit Agreement are required to
be performed by it as a Lender including, without limitation, if it is organized
under the laws of a jurisdiction outside the United States, its obligation
pursuant to Section 2.21(e) of the Credit Agreement.
3. The undersigned’s address for notices for the purposes of the Credit
Agreement is as follows:

         
 
       
 
 
 
   
 
       
 
 
 
   
 
       
 
 
 
   
 
       
 
 
 
   

4. Terms defined in the Credit Agreement shall have their defined meanings when
used herein.
IN WITNESS WHEREOF, the undersigned has caused this New Lender Supplement to be
executed and delivered by a duly authorized officer on the date first above
written.

            New Lender

[signature block]
                     

 

- 2 -

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EXHIBIT B-3
FORM OF INCREMENTAL FACILITY ACTIVATION NOTICE

To:  
Barclays Bank PLC,
as Administrative Agent under the Credit Agreement referred to below

Reference is hereby made to that certain Third Amended and Restated Credit
Agreement, dated as of February  _____, 2010 (as amended, restated, supplemented
or otherwise modified from time to time, the “Credit Agreement”), among PINNACLE
ENTERTAINMENT, INC., a Delaware corporation (the “Borrower”), the several banks
and other financial institutions or entities from time to time parties thereto
(the “Lenders”), BANC OF AMERICA SECURITIES LLC AND JPMORGAN SECURITIES, INC.,
as Joint Lead Arrangers and Joint Book Runners and BARCLAYS BANK PLC, as
administrative agent (the “Administrative Agent”). Unless otherwise defined
herein, terms defined in the Credit Agreement and used herein shall have the
meanings given to them in the Credit Agreement
This notice is the Incremental Facility Activation Notice referred to in the
Credit Agreement, and the Borrower and each of the Lenders party hereto hereby
notify you that:

  1.  
Each of the Lenders party hereto agrees to make, obtain or increase the amount
of its [Incremental Term Loans] [Incremental Revolving Credit Commitment]
[Incremental Revolving Credit Loans] [Incremental Delayed Draw Term Commitment]
[Incremental Delayed Draw Term Loans] as set forth opposite such Lender’s name
on the signature pages hereof under the caption “Incremental Facility Amount”.
    2.  
The Incremental Loans closing date is                      (which must be a
Business Day).
    3.  
The Incremental Term Loans maturity date is                     .
    4.  
The Incremental Delayed Draw Term Loans maturity date is                     .
    5.  
The Incremental Revolving Credit Loans maturity date is                     .
    6.  
[Each of the Lenders party hereto and the Borrower hereby agrees that (a) the
amortization schedule relating to the Incremental Term Loans is set forth in
Annex A attached hereto and (b) the Applicable Margin for the Incremental Term
Loans shall be                     .]1
    7.  
[Each of the Lenders party hereto and the Borrower hereby agrees that (a) the
amortization schedule relating to the Incremental Delayed Draw Term Loans

 

      1  
For Incremental Term Loans only.

 

 

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

 

     
is set forth in Annex B attached hereto and (b) the Applicable Margin for the
Incremental Delayed Draw Term Loans shall be                     .]2
    8.  
[Each of the Lenders party hereto and the Borrower hereby agrees that the
Applicable Margin for the Incremental Revolving Credit Loans shall be
                    .]3

[Signature block for Borrower]
[Signature blocks for Lenders]
[Annex A – attached]
[Annex B – attached]
 

      2  
For Incremental Delayed Draw Term Loans only.
  3  
For Incremental Revolving Credit Loans only.

 

-2-

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EXHIBIT C
FORM OF MORTGAGE
MORTGAGE,
ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND
COLLATERAL ASSIGNMENT OF PROCEEDS

             
 
  BY  
 
   
 
                 

IN FAVOR OF
BARCLAYS BANK PLC,
as Administrative Agent
BE IT KNOWN, on the dates set forth below, in the presence of the undersigned
Notaries Public, duly qualified in and for the States and Parishes/Counties set
forth below and in the presence of the undersigned competent witnesses,
PERSONALLY CAME AND APPEARED:
                    , whose federal taxpayer identification number is
                    , having a mailing address of c/o Pinnacle Entertainment,
Inc., Suite 1800, 3800 Howard Hughes Parkway, Las Vegas, NV 89109, represented
herein by and through                     , its                     , duly
authorized hereunto by resolutions of its Board of Directors, a certified copy
of which is annexed hereto (said appearer being hereinafter referred to as
“Trustor”); and,
BARCLAYS BANK PLC, in its capacity as Administrative Agent under the Credit
Agreement (hereinafter defined) whose federal taxpayer identification number is
                     and whose mailing address is
                                        , represented herein by and through
                    , duly authorized (said appearer being hereinafter referred
to as “Beneficiary”); and,
who declared that Pinnacle Entertainment, Inc. (“Borrower”), Beneficiary, and
various banks have entered into a certain Third Amended and Restated Credit
Agreement dated as of February  _____, 2010 (as it may be amended, restated,
amended and restated, modified, supplemented, or replaced from time to time, the
“Credit Agreement”). Appearers further declared that capitalized terms used
herein and not otherwise defined shall have the meanings given to them in the
Credit Agreement.
Appearers further declared that Trustor is a Subsidiary of Borrower and that it
is a condition of the Credit Agreement that Trustor execute and deliver this
act.

 

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As more particularly described therein, the Credit Agreement provides for
extensions of credit to the Borrower thereunder, including a Revolving Credit
Commitment in the aggregate amount of $350,000,000, including Incremental Term
Commitments, a Swing Line Commitment of $25,000,000 and a L/C Commitment of
                                        , and certain hedge agreements.
Trustor is a party to that certain Mortgage, Assignment of Leases and Rents,
Security Agreement and Collateral Assignment of Proceeds, dated as of
                    , (the “Existing Mortgage”), under which Trustor agreed to
grant a security interest in the Property (as defined below in Section 1.1) to
Beneficiary, as administrative agent for the Existing Lenders, for the ratable
benefit of such Existing Lenders. The Existing Mortgage is being amended by this
Amended and Restated Mortgage, Assignment of Leases and Rents, Security
Agreement and Collateral Assignment of Proceeds, by and between Trustor and
Beneficiary, dated as of this                     , 20_____, (the “Mortgage”).
In consideration of the extension of credit to the Borrower pursuant to the
Credit Agreement and the direct and indirect benefits to be received by Trustor
as a result thereof, Appearers further declared and agreed as follows:
1. Mortgage and Secured Obligations.
1.1 Mortgage. For the purpose of securing payment and performance of the Secured
Obligations defined and described in Section 1.2, Trustor does by these presents
irrevocably and unconditionally specially mortgage, pledge, affect, hypothecate,
transfer, assign to and grant a security interest in favor of Beneficiary all
estate, right, title and interest which Trustor now has or may later acquire in
and to the following property (all or any part of such property, or any interest
in all or any part of it, as the context may require, the “Property”):
(a) The leasehold estate in a portion of the “Land” (as defined below) described
in Tract 3 of Exhibit A under that certain Commercial Lease dated as of
September 9, 1996, between State of Louisiana, State Land Office, as landlord,
and Trustor, as tenant (as it may be amended or modified, the “Existing Ground
Lease”), which lease was recorded on September 19, 1996, in the public records
of Bossier Parish, Louisiana at Registry No. 622376 in Conveyance Book 1114,
Page 544 and also recorded on September 19, 1996, in the public records of Caddo
Parish, Louisiana at Registry No. 1532436 in Conveyance Book 3138, Page 271,
including, without limitation, (i) all options to extend or renew the Existing
Ground Lease (and the leasehold estate for the term of each extension or
renewal), (ii) all options and rights of first refusal contained in the Existing
Ground Lease to purchase portions of the Land, which is subject to the Existing
Ground Lease, and (iii) all of Trustor’s other rights, titles and interests
under the Existing Ground Lease; together with
(b) The immovable property located in the Parish of Bossier and the Parish of
Caddo (the “Parish”), State of Louisiana, as described in Exhibit A, together
with all existing and future servitudes, easements and rights affording access
to it (the “Land”); together with

 

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(c) All buildings, structures, component parts, other constructions, and
improvements now located or later to be constructed on the Land, including,
without limitation, all parking areas, roads, driveways, walks, fences, walls,
docks, berms, landscaping, recreation facilities, drainage facilities, lighting
facilities and other site improvements (the “Improvements”); together with
(d) All existing and future appurtenances, privileges, servitudes, rights of
use, easements, rights of way, franchises, hereditaments and tenements of the
Land, including all minerals, oil, gas, other hydrocarbons and associated
substances, sulphur, nitrogen, carbon dioxide, helium and other commercially
valuable substances which may be in, under or produced from any part of the
Land, all development rights and credits, air rights, water, water courses,
water rights (whether riparian, appropriative or otherwise, and whether or not
appurtenant) and water stock (together with the statutory right to file
applications to change, and any and all applications to change), servitudes,
easements, rights of way, rights of ingress and egress, drainage rights, gores
or strips of land, any land lying in the streets, highways, ways, sidewalks,
alleys, passages, roads or avenues, open or proposed, in front of or adjoining
the Land and Improvements, any land in the bed of any body of water adjacent to
the Land, any land adjoining the Land created by artificial means or by
accretion, all air space and rights to use such air space, and all development
and similar rights; together with
(e) Subject to Article 2, below, all existing and future leases, subleases,
subtenancies, licenses (except for gaming licenses and liquor licenses that are
not transferable), occupancy agreements, concessions and any other agreement
leasing or letting any portion of the Property or relating to the use and
enjoyment of all or any part of the Land and Improvements, and any and all
guaranties and other agreements relating to or made in connection with any of
the foregoing, whether written or oral and whether in existence at or upon the
recordation of this Mortgage or entered into after the recordation of this
Mortgage (some or all collectively, as the context may require, “Leases,” which
shall not include the Ground Leases), and all rents, security deposits,
royalties, issues, profits, receipts, earnings, revenue, income, products and
proceeds and other benefits of the Land and Improvements, whether now due, past
due or to become due, including, without limitation, all prepaid rents, security
deposits, fixed, additional and contingent rents, deficiency rents and
liquidated damages, occupancy charges, hotel room charges, cabana charges,
casino revenues, show ticket revenues, food and beverage revenues, room service
revenues, merchandise sales revenues, parking, maintenance, common area, tax,
insurance, utility and service charges and contributions, proceeds of sale of
electricity, gas, heating, air-conditioning, cable and other utilities and
services, green fees, cart rental fees, instruction fees, membership charges,
restaurant, snack bar and pro shop revenues, liquidated damages, and all other
rights to payments (some or all collectively, as the context may require,
“Rents”); together with
(f) All goods, materials, supplies, chattels, furniture, fixtures, equipment,
machinery and other property now or later to be attached to, placed in or on, or
used in connection with the use, enjoyment, occupancy or operation of all or any
part of the Land and Improvements, whether stored on the Land or elsewhere,
including all pumping plants, engines, pipes, ditches and flumes, and also all
gas, electric, cooking,

 

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heating, cooling, air conditioning, lighting, refrigeration and plumbing
fixtures and equipment, all water, sanitary and storm sewer, drainage,
electricity, steam, gas, telephone, cable and other utility equipment and
facilities, all plumbing, lighting, heating, ventilating, air conditioning,
refrigerating, incinerating, compacting, fire protection and sprinkler,
surveillance and security, vacuum cleaning, public address and communications
equipment and systems, all kitchen and laundry appliances, screens, awnings,
floor coverings, partitions, elevators, escalators, motors, machinery, pipes,
fittings and other items of equipment and property of every kind and
description; together with
(g) All building materials, equipment, work in process or other personal
property of any kind, whether stored on the Land or elsewhere, which have been
or later will be acquired for the purpose of being delivered to, incorporated
into or installed in or about the Land or Improvements; together with
(h) All rights to the payment of money, accounts, accounts receivable, reserves,
deferred payments, refunds of real property and personal property taxes,
refunds, cost savings, payments and deposits, whether now or later to be
received from third parties (including all earnest money sales deposits) or
deposited by Trustor with third parties (including all utility deposits),
contract rights, general intangibles, development and use rights, governmental
permits and licenses (except for gaming licenses and liquor licenses that are
not transferable), authorizations, certificates, variances, consents and
approvals, applications, architectural and engineering plans, specifications and
drawings, as-built drawings, guaranties, warranties, management agreements,
operating and/or licensing agreements, supply and service contracts for water,
sanitary and storm sewer, drainage, electricity, steam, gas, telephone, cable,
and other utilities, property and title insurance policies and proceeds thereof,
chattel paper, instruments, documents, notes, certificates of deposit, deposit
accounts, securities, investment property, other investments, drafts and letters
of credit (other than letters of credit in favor of Beneficiary), which arise
from or relate to construction on the Land or to any business now or later to be
conducted on it, or to the Land and Improvements generally; together with
(i) Subject to the Borrower’s rights to use proceeds under the Credit Agreement,
all proceeds, including all rights and claims to, dividends of and demands for
them, of the voluntary or involuntary conversion of any of the Land,
Improvements or the other property described above into cash or liquidated
claims, including proceeds of all present and future fire, hazard or casualty
insurance policies (whether or not such policies are required hereunder or under
one of the other Loan Documents) and all condemnation awards or payments now or
later to be made by any public body or decree by any court of competent
jurisdiction for any taking or in connection with any condemnation or eminent
domain proceeding, and all causes of action and their proceeds for any damage or
injury to the Land, Improvements or the other property described above or any
part of them, or breach of warranty in connection with the construction of the
Improvements, including causes of action arising in tort, contract, fraud or
concealment of a material fact; together with

 

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(j) All books and records pertaining to any and all of the property described
above, including computer readable memory and any computer hardware or software
necessary to access and process such memory (“Books and Records”); together with
(k) All proceeds of, additions and accretions to, substitutions and replacements
for, changes in, and greater right, title and interest in, to and under or
derived from, any of the property described above and all extensions,
improvements, betterments, renewals, substitutions and replacements thereof and
additions and appurtenances thereto, including all proceeds of any voluntary or
involuntary disposition or claim, right and remedy respecting any such property
(arising out of any judgment, condemnation or award, or otherwise arising) and
all goods, documents, general intangibles, chattel paper and accounts, wherever
located, acquired with cash proceeds of any of the foregoing or its proceeds.
All of the aforedescribed Property shall remain so specially mortgaged, affected
and hypothecated or, as set forth above, collaterally assigned or pledged, unto
and in favor of Beneficiary until the full and final payment, performance and
observance of the Secured Obligations secured by this Mortgage.
With respect to the proceeds attributable to the insured loss of all or any part
of the Property referred to in (i) above and in Section 5.5 hereof, this
Mortgage is a collateral assignment thereof pursuant to La. R.S. § 9:5386 et
seq., whether such proceeds or any of them now exist or arise in the future, and
Trustor does hereby irrevocably make, constitute and appoint Beneficiary and the
agents of Beneficiary as the true and lawful mandataries and attorneys-in-fact
of Trustor to carry out and enforce all of the proceeds hereby collaterally
assigned, subject to the Credit Agreement. The mandatory and attorney-in-fact
designation set forth in the preceding sentence shall be coupled with an
interest and may not be revoked by Trustor so long as this Mortgage remains in
effect. Such proceeds shall otherwise be included in the term “Property,” for
all purposes of this Mortgage. The collateral assignment herein made of the
aforesaid proceeds shall not be construed as imposing upon Beneficiary any
obligations with respect thereto unless and until Beneficiary shall become the
absolute owner thereof and Trustor shall have been wholly dispossessed thereof.
Trustor shall and will warrant and forever defend the Property and the quiet and
peaceable possession of the Beneficiary, its successors and assigns against all
and every person or persons lawfully claiming or to claim the whole or any part
thereof. Trustor agrees that any greater title to the Property hereafter
acquired by Trustor during the term hereof shall be subject hereto.
1.2 Secured Obligations.
1.2.1 Trustor makes the mortgage, hypothecation, pledge, grant, transfer and
assignment set forth in Section 1.1 and the assignment set forth in Article 2
and grants the security interest set forth in Article 3 for the purpose of
securing payment and performance of the

 

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following obligations (collectively, the “Secured Obligations”) in any order of
priority that Beneficiary may choose:
(a) The payment and performance of all indebtedness and other obligations of
Trustor under the Subsidiary Guaranty;
(b) The payment and performance of all obligations of Trustor under this
Mortgage;
(c) The payment and performance of all future advances and other obligations
that Trustor, Borrower or any other person may owe to Beneficiary and/or any
Lenders (whether as principal, surety or guarantor), when a writing evidences
Trustor’s and Beneficiary’s agreement that such advances or obligations be
secured by this Mortgage; and
(d) The payment and performance of all modifications, amendments, extensions and
renewals, however evidenced, of any of the Secured Obligations described in
clauses (a), (b) or (c), above.
1.2.2 All persons who may have or acquire an interest in all or any part of the
Property will be considered to have notice of, and will be bound by, the terms
of the Secured Obligations and each other agreement or instrument made or
entered into in connection with each of the Secured Obligations. Such terms
include any provisions in the Credit Agreement or the other Loan Documents which
permit borrowing, repayment and reborrowing, or which provide that the interest
rate on one or more of the Secured Obligations may vary from time to time.
1.3 This Mortgage secures the prompt payment and performance of the Secured
Obligations, including, without limitation, the payment of the Notes and all
amounts owing under the Credit Agreement and the Loan Documents and the payment
and performance of all other obligations, whether presently existing, now
arising or incurred hereafter, whether incurred for personal or non-business
purpose, or for any other purpose related or unrelated, or similar or
dissimilar, to the purpose of the Loan, whether or not such Secured Obligations
are of the same type or character. Trustor and Beneficiary acknowledge and agree
that this Mortgage may secure Secured Obligations that have been or will be
borrowed, repaid and reborrowed from time to time, one or more, times, and that
this Mortgage shall be effective, as to all future advances, as of the date of
execution and recordation hereof, it being intended that this Mortgage be a
mortgage to secure present and future obligations to the fullest extent
permitted by La. Civ. Code art. 3298.
NOTWITHSTANDING ANY PROVISION OF THIS MORTGAGE TO THE CONTRARY, THE MAXIMUM
PRINCIPAL AMOUNT OF THE SECURED OBLIGATIONS THAT MAY BE OUTSTANDING AT ANY TIME
AND FROM TIME TO TIME THAT THIS MORTGAGE SECURES, INCLUDING, WITHOUT LIMITATION,
AS A MORTGAGE AND AS A COLLATERAL ASSIGNMENT OF LEASES AND RENTS, INCLUDING ALL
PRINCIPAL, INTEREST AND ANY EXPENSES OR ADDITIONAL OBLIGATIONS INCURRED BY THE
BENEFICIARY

 

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AND ALL OTHER AMOUNTS INCLUDED WITHIN THE SECURED OBLIGATIONS, IS
$750,000,000.00.
1.4 No Paraphs. Trustor and Beneficiary acknowledge that neither the Notes, any
other note nor any other written evidence of indebtedness has been paraphed for
identification with this Mortgage.
2. Assignment of Rents and Leases.
2.1 Absolute Assignment. Trustor hereby irrevocably, absolutely, presently and
unconditionally assigns, transfers and sets over to Beneficiary all of the
right, title and interest which Trustor now has or may later acquire in and to
the Rents and the Leases, and confers upon Beneficiary the right, upon the
occurrence and during the continuance of an Event of Default (hereinafter
defined), to collect such Rents and enforce the provisions of the Leases with or
without taking possession of the Property. The assignment of Leases and Rents to
Beneficiary herein is made pursuant to La. R.S. § 9:4401.
2.2 Prior to an Event of Default. Beneficiary shall have the right to collect
and retain the Rents as they become due and payable, so long as no Event of
Default, as defined in Section 6.1, shall exist and be continuing. If an Event
of Default has occurred and is continuing, the assignment of Leases and Rents to
Beneficiary shall become absolute as provided in La. R.S. § 9:4401.
2.3 Grant of License. Beneficiary hereby confers upon Trustor a license
(“License”) to collect and retain the Rents as they become due and payable;
provided that if an Event of Default has occurred and is continuing, Beneficiary
shall have the right, which it may choose to exercise in its absolute
discretion, to terminate this License without notice to or demand upon Trustor,
and without regard to the adequacy of Beneficiary’s security under this
Mortgage; provided further that until Beneficiary has terminated the License as
provided herein, Trustor may continue to collect and retain the Rents pursuant
to the License.
2.4 Collection and Application of Rents. Subject to the License granted to
Trustor under Section 2.3 above, and only upon the occurrence and during the
continuance of an Event of Default, Beneficiary shall have the right, power and
authority to collect any and all Rents and exercise Trustor’s right, title and
interest under the Leases. Trustor hereby appoints Beneficiary as its mandatory
attorney-in-fact (which appointment is irrevocable and coupled with an interest)
to perform any and all of the following acts upon the occurrence and during the
continuance of an Event of Default, if and at the times when Beneficiary, in its
absolute discretion, may so choose:
(a) Demand, receive and enforce payment of any and all Rents and any other
right, title and interest of Trustor under the Leases;
(b) Give receipts, releases and satisfactions for any and all Rents and any
other obligations and duties under the Leases; or
(c) Sue either in the name of Trustor or in the name of Beneficiary for any and
all Rents and to enforce any other obligations and duties under the Leases.

 

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Beneficiary’s right to the Rents and the Leases does not depend on whether or
not Beneficiary takes possession of the Property as permitted under
Section 6.2.3 hereof, or as permitted under applicable law. In Beneficiary’s
absolute discretion, Beneficiary may choose to collect Rents and exercise the
right, title and interest of Trustor under the Leases either with or without
taking possession of the Property. Beneficiary shall apply all Rents collected
by it in the manner provided under Section 6.5. If an Event of Default shall
have occurred and Beneficiary is in possession of all or part of the Property as
Keeper (hereinafter defined) thereof or otherwise and is collecting and applying
Rents and exercising any right, title and interest of Trustor under the Leases
as permitted under this Mortgage, then Beneficiary and any Keeper shall
nevertheless be entitled to exercise and invoke every right and remedy afforded
any of them under this Mortgage and at law and in equity.
2.5 Beneficiary Not Responsible. Under no circumstances shall Beneficiary have
any duty to produce Rents from the Property or maintain the Leases. Regardless
of whether or not Beneficiary, in person or by agent, takes actual possession of
the Land and Improvements as Keeper or otherwise, Beneficiary is not and shall
not be deemed to be:
(a) a “mortgagee in possession” for any purpose;
(b) responsible for performing any of the obligations under any Lease;
(c) responsible for any waste committed by lessees or any other parties, any
dangerous or defective condition of the Property, or any negligence in the
management, upkeep, repair or control of the Property; or
(d) liable in any manner for the Property or the use, occupancy, enjoyment or
operation of all or any part of it.
2.6 Leasing. Without Beneficiary’s prior written consent, Trustor shall not
accept any deposit or prepayment of Rents for any period exceeding one month,
and Trustor shall not lease the Property or any part of it except strictly in
accordance with the Loan Documents. Trustor shall not apply any Rents in any
manner prohibited by the Loan Documents.
2.7 Maximum Amount Secured. NOTWITHSTANDING ANY PROVISION OF THIS MORTGAGE TO
THE CONTRARY, THE MAXIMUM PRINCIPAL AMOUNT OF THE SECURED OBLIGATIONS THAT MAY
BE OUTSTANDING AT ANY TIME AND FROM TIME TO TIME THAT THIS MORTGAGE SECURES,
INCLUDING, WITHOUT LIMITATION, AS A MORTGAGE AND AS A COLLATERAL ASSIGNMENT OF
LEASES AND RENTS, INCLUDING ALL PRINCIPAL, INTEREST AND ANY EXPENSES OR
ADDITIONAL OBLIGATIONS INCURRED BY THE BENEFICIARY AND ALL OTHER AMOUNTS
INCLUDED WITHIN THE SECURED OBLIGATIONS, IS $750,000,000.00.
3. Grant of Security Interest.
3.1 Security Agreement. The parties intend for this Mortgage to create a lien on
and security interest in the Property, and an absolute assignment of the Rents
and the Leases, all in favor of Beneficiary. The parties acknowledge that some
of the Property and some of the Rents and Leases may be determined under
applicable law to be personal property or fixtures. To the

 

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extent such Property, Rents or Leases constitute personal property, Trustor, as
debtor, hereby grants to Beneficiary, as secured party, a security interest in
all such Property, Rents and Leases, to secure payment and performance of the
Secured Obligations, and Trustor, as debtor, also has granted a security
interest in such Property, Rents and Leases pursuant to a certain Security
Agreement of even date herewith, executed by Trustor and by certain other
parties, as debtors, in favor of Beneficiary, as secured party. This Mortgage
constitutes a security agreement under Chapter 9 of the Louisiana Commercial
Laws, La. R.S. § 10:91-101 et seq. (“Chapter 9”), as amended or recodified from
time to time, covering all such Property, Rents and Leases. To the extent such
Property, Rents or Leases are not immovable property encumbered by the lien
created by Section 1.1, above, and are not assigned by the assignment set forth
in Section 2.1, above, it is the intention of the parties that such Property,
Rents and/or Leases shall constitute “proceeds, products, offspring, or profits”
and/or “rents” of the Land and Improvements, and/or “fees, charges, accounts, or
other payments for the use or occupancy of rooms and other public facilities in
... lodging properties,” as applicable (as such terms are defined in and for the
purposes of Section 552(b) of the United States Bankruptcy Code, as such Section
may be modified or supplemented).
3.2 Financing Statements. Trustor hereby authorizes Beneficiary to execute one
or more financing statements and such other documents as Beneficiary may from
time to time require to perfect or continue the perfection of Beneficiary’s
security interest in any Property, Rents or Leases. As provided in Section 5.11,
Trustor shall pay all fees and costs that Beneficiary may incur in filing such
documents in public offices and in obtaining such record searches as Beneficiary
may reasonably require. If Trustor fails to execute any financing statements or
other documents for the perfection or continuation of any security interest,
Trustor hereby appoints Beneficiary as its true and lawful mandatory
attorney-in-fact (which appointment is irrevocable and coupled with an interest)
to execute any such documents on its behalf. If any financing statement or other
document is filed in the records normally pertaining to personal property, that
filing shall never be construed as in any way derogating from or impairing this
Mortgage or the rights or obligations of the parties under it.
4. Intentionally Omitted.
5. Rights and Duties of the Parties.
5.1 Representations and Warranties. Trustor represents and warrants that, except
as previously disclosed to Beneficiary in Schedule 7.3(f) attached to the Credit
Agreement:
(a) This Mortgage creates a first and prior lien on and security interest in the
Property, subject only to the Liens permitted by Section 7.3 of the Credit
Agreement, and other encumbrances and rights permitted by this Mortgage;
(b) The Property includes all material property and rights which may be
reasonably necessary or desirable for the use, if any, of the Property;
(c) Trustor’s place of business, or its chief executive office if it has more
than one place of business, is located at the address specified above;

 

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(d) This Mortgage does not encumber Land on which Improvements are located in an
area that has been identified by the Secretary of Housing and Urban Development
as an area having special flood hazards and in which flood insurance has been
made available under the National Flood Insurance Act of 1968, except any Land
on which Improvements are located as to which flood insurance as required by
Regulation H has been obtained and is in full force and effect as required by
the Credit Agreement; and
(e) Trustor’s correct name and federal employer identification number are as set
forth on the first Page hereof.
5.2 Taxes and Assessments. To the extent required under the Credit Agreement,
Trustor shall pay prior to delinquency all taxes, levies, charges and
assessments, including assessments on appurtenant water stock, imposed by any
public or quasi-public authority or utility company which are (or if not paid,
may become) a lien on or security interest in all or part of the Property or any
interest in it, or which may cause any decrease in the value of the Property or
any part of it. If any such taxes, levies, charges or assessments become
delinquent, Beneficiary may require Trustor to present evidence that they have
been paid in full, on ten days’ written notice by Beneficiary to Trustor. This
Section 5.2 is subject to the right granted to Trustor in the Credit Agreement
to contest in good faith certain taxes, assessments, charges and levies (and
Trustor’s failure to pay any immaterial tax shall not constitute an Event of
Default hereunder to the extent Trustor is excused from paying such tax pursuant
to Section 4.10 of the Credit Agreement); otherwise, should Trustor fail to pay
any of the aforesaid taxes, levies, charges or assessments prior to the date
that same become delinquent, Beneficiary, at its sole option, shall have the
right, but not the obligation, to pay such taxes, levies, charges and
assessments and all amounts advanced by Beneficiary for such purpose, together
with interest thereon at the rate of 2.0% above the Base Rate from the fifth day
following the date of demand for payment by Beneficiary until repaid, shall be
secured by this Mortgage and payable on demand.
5.3 Performance of Secured Obligations. Trustor shall promptly pay and perform
or cause the payment and performance of, each Secured Obligation in accordance
with its terms.
5.4 Liens, Charges and Encumbrances. Trustor shall promptly discharge any lien
on or security interest in the Property to which Beneficiary has not consented
in writing, except any Liens permitted by Section 7.3 of the Credit Agreement.
Subject to any applicable rights to contest set forth in the Credit Agreement:
(a) Trustor shall pay when due each obligation secured by or reducible to a
lien, security interest, charge or encumbrance which now does or later may
encumber or appear to encumber all or part of the Property or any interest in
it, whether the lien, security interest, charge or encumbrance is or would be
senior or subordinate to this Mortgage; and (b) should Trustor fail to perform
its obligations under this Section 5.4, Beneficiary, at its option, shall have
the right, but not the obligation, to advance funds which may be necessary to
protect and preserve Beneficiary’s liens hereunder, and to discharge Trustor’s
obligations under this Section 5.4, and all amounts so advanced by Beneficiary,
together with interest thereon at the rate provided for in Section 2.16(c)(ii)
of the Credit Agreement from the fifth day following the date of demand for
payment by Beneficiary until repaid, shall be secured by this Mortgage and
payable on demand.

 

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5.5 Damages and Insurance and Condemnation Proceeds.
5.5.1 The following claims, causes of action, awards, payments and rights to
payment are subject to the Borrower’s rights to use such proceeds as provided in
the Credit Agreement:
(a) All awards of damages and all other compensation payable directly or
indirectly because of a condemnation, proposed condemnation or taking for public
or private use which affects all or part of the Property or any interest in it;
(b) All other awards, claims and causes of action, arising out of any warranty
affecting all or any part of the Property, or for damage or injury to or
decrease in value of all or part of the Property or any interest in it;
(c) All proceeds of any insurance policies payable because of loss sustained to
all or part of the Property; and
(d) All interest which may accrue on any of the foregoing.
5.5.2 Trustor shall promptly notify Beneficiary in writing if:
(a) Any damage occurs or any injury or loss is sustained in the amount of
$1,000,000 or more to all or part of the Property, or any action or proceeding
relating to any such damage, injury or loss is commenced; or
(b) Any offer is made, or any action or proceeding is commenced, which relates
to any actual or proposed condemnation or taking of all or material part of the
Property.
5.5.3 Subject to the Credit Agreement, including, without limitation,
Section 2.13 thereof, if Beneficiary chooses to do so, Beneficiary may in its
own name appear in or prosecute any action or proceeding to enforce any cause of
action based on warranty, or for damage, injury or loss to all or part of the
Property, and Beneficiary may make any compromise or settlement of such action
or proceeding; provided, however, that, prior to the occurrence of an Event of
Default, Beneficiary shall not settle or compromise any such action or
proceeding without the prior written consent of Trustor (which consent shall not
be unreasonably withheld or delayed). Beneficiary, if it so chooses, may
participate in any action or proceeding relating to condemnation or taking of
all or part of the Property, and may join Trustor in adjusting any loss covered
by insurance. Trustor hereby irrevocably appoints Beneficiary as its true and
lawful mandatory and attorney-in-fact for all such purposes. The power of
attorney granted hereunder is coupled with an interest and is irrevocable.
Trustor shall not settle, adjust or compromise any such action or proceeding
without the prior written approval of Beneficiary.
5.5.4 All proceeds of these assigned claims, other property and rights which
Trustor may receive or be entitled to (collectively, “Proceeds”) shall be
administered in

 

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accordance with the terms of the Credit Agreement, including, without
limitation, Section 2.13 thereof. Any and all Proceeds (including, without
limitation, any Net Claims Proceeds) held by Beneficiary from time to time shall
be collateral for the Secured Obligations, and Trustor hereby grants to
Beneficiary a security interest in and lien on such Proceeds and all rights and
remedies available under applicable laws with respect to such Proceeds,
including, without limitation, all rights and remedies under Chapter 9. Trustor
shall execute and deliver to Beneficiary and the Lenders any and all documents
reasonably requested by Beneficiary in order to confirm, create and perfect such
security interest in and lien on such Proceeds.
5.5.5 Trustor hereby specifically, unconditionally and irrevocably waives all
rights of a property owner granted under applicable laws which provide for
allocation of condemnation proceeds between a property owner and a lienholder up
to the principal amount of Secured Obligations under the Credit Agreement, and
any other law or successor statute of similar import. Trustor hereby
specifically, unconditionally and irrevocably waives all right to recover
against Beneficiary or any Lender (or any officer, employee, agent or
representative of Beneficiary or any Lender) for any loss incurred by Trustor
from any cause insured against or required by any Loan Document to be insured
against; provided, however, that this waiver of subrogation shall not be
effective with respect to any insurance policy if the coverage thereunder would
be materially reduced or impaired as a result.
5.6 Maintenance and Preservation of Property.
5.6.1 Subject to Section 6.5 of the Credit Agreement, Trustor shall keep all
Property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted.
5.6.2 Subject to the terms of Section 2.13 of the Credit Agreement, if all or
part of the Property becomes damaged or destroyed and Trustor elects to repair
and/or restore all or part of the Property, Trustor shall promptly and
completely repair and/or restore the Property in a good and workmanlike manner
in accordance with sound building practices. If Trustor elects to repair and/or
restore all or part of the Property, Trustor shall be obligated to repair and/or
restore the Property in accordance with the immediately preceding sentence even
if no insurance proceeds are available or the available insurance proceeds are
not sufficient to pay for the entire cost of such repair and/or restoration.
5.6.3 Trustor shall not commit or allow any act upon or use of the Property
which would violate: (i) any applicable law or order of any Governmental
Authority, whether now existing or later to be enacted and whether foreseen or
unforeseen (except to the extent that noncompliance would not cause a Material
Adverse Effect or a License Revocation); or (ii) any public or private covenant,
condition, restriction, equitable servitude or Contractual Obligation affecting
the Property (except to the extent such violation is being contested by Trustor
in good faith by appropriate proceedings or such violation would not cause a
Material Adverse Effect). Trustor shall not bring or keep any article on the
Property or cause or allow any condition to exist on it that invalidates any
insurance coverage required to be maintained by Trustor on the Property or any
part of it under this Mortgage or the Loan Documents.
5.6.4 Trustor shall not commit or allow material waste of the Property.

 

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5.6.5 Should Trustor fail to perform its obligations under this Section 5.6,
Beneficiary, at its sole option, shall have the right, but not the obligation,
to advance funds for the protection, preservation, repair or recovery of the
Property, and all amounts so advanced by Beneficiary, together with interest
thereon at 2.0% above the Base Rate from the fifth day following the date of
demand for payment by Beneficiary until repaid, shall be secured by this
Mortgage and payable on demand.
5.7 Insurance.
5.7.1 Trustor shall maintain with financially sound and reputable insurance
companies insurance on all of its Property in at least such amounts and against
at least such risks (but including in any event public liability, product
liability and business interruption) as are usually insured against in the same
general area by companies engaged in the same or a similar business.
5.7.2 When any insurance policy required hereunder expires, Trustor shall
furnish Beneficiary with proof acceptable to Beneficiary that the policy has
been reinstated, renewed or a new policy issued, continuing in force the
insurance covered by the policy which expired.
5.7.3 Should Trustor fail to procure any of the insurance required by this
Section 5.7, Beneficiary, at its sole option, shall have the right, but not the
obligation, to purchase such insurance and all amounts advanced by Beneficiary
for such purpose, together with interest thereon at the rate provided for in
Section 2.16(c)(ii) of the Credit Agreement shall be secured by this Mortgage
and payable on demand.
5.8 [Intentionally Left Blank.]
5.9 Releases, Extensions, Modifications and Additional Security.
5.9.1 From time to time, Beneficiary may perform any of the following acts
without incurring any liability or giving notice to any person, and without
affecting the personal liability of any person for the payment of the Secured
Obligations (except as provided below), and without affecting the security
hereof for the full amount of the Secured Obligations on all Property remaining
subject hereto, and without the necessity that any sum representing the value of
any portion of the Property affected by Beneficiary’s action(s) be credited on
the Secured Obligations:
(a) Release any person liable for payment of any Secured Obligation, except as
permitted by Section 10.15 of the Credit Agreement;
(b) Extend the time for payment, or otherwise alter the terms of payment, of any
Secured Obligation;
(c) Accept additional real, immovable, movable or personal property of any kind
as security for any Secured Obligation, whether evidenced by deeds of trust,
mortgages, security agreements or any other instruments of security;

 

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(d) Alter, substitute or release any property securing the Secured Obligations;
(e) Consent to the making of any plat or map of the Property or any part of it;
(f) Join in granting any easement or creating any restriction affecting the
Property;
(g) Join in any subordination or other agreement affecting this Mortgage or the
lien or security interest of it; or
(h) Release the Property or any part of it from the lien of this Mortgage, in
accordance with the Credit Agreement.
5.10 Termination of Mortgage. In the event that (i) Trustor has requested
Beneficiary release the Property, or portions thereof, from the lien of this
Mortgage pursuant to a Disposition permitted under the terms of the Credit
Agreement, or (ii) all Secured Obligations (other than contingent indemnity
obligations and obligations in respect of the Specified Hedge Agreements) are
paid and performed in full and neither Trustor nor Beneficiary is bound, to one
another or to a third party, to permit the incurrence of additional Secured
Obligations, Trustor may give notice to Beneficiary of its intent to terminate
this Mortgage and may request that Beneficiary execute a release of this
Mortgage, or partial release, at the expense of Trustor. Such termination shall
not become effective, and Beneficiary shall not be obligated to execute such a
release, until sixty (60) days after Beneficiary has actually received such
notice in the manner required by Section 9.11 hereof and until Beneficiary has
determined, in good faith, that Trustor is entitled to terminate this Mortgage
and obtain such release under the terms of this Section 5.10.
5.11 Compensation, Exculpation, Indemnification.
5.11.1 Trustor agrees to pay fees in the maximum amounts legally permitted, or
reasonable fees as may be charged by Beneficiary when the law provides no
maximum limit, for any services that Beneficiary may render in connection with
this Mortgage, including Beneficiary’s providing a statement of the Secured
Obligations or Beneficiary’s rendering of services in connection with a release
or termination of this Mortgage. Trustor shall also pay or reimburse all of
Beneficiary’s costs and expenses which may be incurred in rendering any such
services. Trustor further agrees to pay or reimburse Beneficiary for all costs,
expenses and other advances which may be incurred or made by Beneficiary in any
efforts to enforce any terms of this Mortgage to the extent provided in
Section 9.7 of the Credit Agreement. If Beneficiary chooses to dispose of the
Property through more than one Foreclosure Sale, Trustor shall pay all costs,
expenses or other advances that may be incurred or made by Beneficiary in each
of such Foreclosure Sales.
5.11.2 Beneficiary shall not be directly or indirectly liable to Trustor or any
other person as a consequence of any of the following:
(a) Beneficiary’s exercise of, or failure to exercise, any rights, remedies or
powers granted to Beneficiary in this Mortgage;

 

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(b) Beneficiary’s failure or refusal to perform or discharge any obligation or
liability of Trustor under any agreement related to the Property or under this
Mortgage; or
(c) Any loss sustained by Trustor or any third party resulting from
Beneficiary’s failure to lease or operate the Property, or from any other act or
omission of Beneficiary in managing the Property, after an Event of Default,
unless the loss is caused by the gross negligence or willful misconduct of
Beneficiary.
Trustor hereby expressly waives and releases all liability (other than liability
for loss caused by the gross negligence or willful misconduct of Beneficiary) of
the types described above, and agrees that no such liability shall be asserted
against or imposed upon Beneficiary.
5.11.3 Trustor agrees to, and does hereby, indemnify Beneficiary and the Lenders
and their respective agents, employees, officers, directors, consultants,
shareholders, attorneys and Keepers (collectively, the “Indemnitees”) to the
extent provided in Section 9.7 of the Credit Agreement.
5.12 Defense and Notice of Claims and Actions. At Trustor’s sole expense,
Trustor shall protect, preserve and defend the Property and title to and right
of possession of the Property, and the security of this Mortgage and the rights
and powers of Beneficiary created under it, against all adverse claims. Trustor
shall give Beneficiary prompt notice in writing if any claim is asserted in
writing which does or could affect the title to or right of possession of the
Property (other than personal property the loss of which would not disrupt the
operations of Trustor), or the security of this Mortgage or the rights and
powers of Beneficiary under this Mortgage, or if any action or proceeding is
commenced which alleges or relates to any such claim.
5.13 [Intentionally Left Blank.]
5.14 Subrogation. Beneficiary shall be subrogated to the liens and security
interests of all encumbrances, whether released of record or not, which are
discharged in whole or in part by Beneficiary in accordance with this Mortgage
or with the proceeds of any Secured Obligations secured by this Mortgage.
5.15 Site Visits, Observation and Testing. Beneficiary and its agents and
representatives shall have the right at any reasonable time upon reasonable
written advance notice to enter and visit the Property for the purpose of
performing appraisals. In addition, Beneficiary and its agents and
representatives shall have the right at any reasonable time upon reasonable
written advance notice to enter and visit the Property for the purposes of
observing the Property, taking and removing soil or groundwater samples, and
conducting tests on any part of the Property. Beneficiary or its agents and
representatives have no duty, however, to visit or observe the Property or to
conduct tests, and no site visit or observation by Beneficiary or its agents or
representatives shall impose any liability on Beneficiary or any other person
entitled to indemnification pursuant to Section 9.7 of the Credit Agreement
(collectively, the “Indemnified Parties”). In no event shall any site visit,
observation or testing by any Indemnified Party be a representation that
Materials of Environmental Concern are or are not present in, on, or under the

 

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Property, or that there has been or shall be compliance with any Environmental
Law, or any other applicable Law. Neither Trustor nor any other party is
entitled to rely on any site visit, observation or testing by any Indemnified
Party. The Indemnified Parties owe no duty of care to protect Trustor or any
other person against, or to inform Trustor or any other person of, any Materials
of Environmental Concern or any other adverse condition affecting the Property.
Beneficiary shall give Trustor reasonable notice before entering the Property.
Beneficiary shall make reasonable efforts to avoid interfering with Trustor’s
use of the Property in exercising any rights provided in this Section.
5.16 Notice of Change. Trustor shall give Beneficiary prior written notice of
(a) any change in the location of Trustor’s place of business or its chief
executive office if it has more than one place of business, (b) any change in
the location of its Books and Records, and (c) any change to Trustor’s name,
jurisdiction of formation, entity structure or federal employer identification
number. Unless otherwise approved by Beneficiary in writing, all Property that
consists of personal property, the removal of which would disrupt the operations
of Trustor (including the Books and Records), will be located on the Land.
5.17 Title Insurance. At any time and from time to time, Trustor, at its sole
cost and expense, shall deliver to Beneficiary title insurance endorsements and
reinsurance as Beneficiary may reasonably request with respect to the priority
of this Mortgage, issued by title insurance companies, all in form and substance
and reasonably satisfactory to Beneficiary, with respect to this Mortgage,
including, without limitation, endorsements insuring that each Loan advance is
secured by this Mortgage (without any exception not set forth in the policy of
title insurance insuring this Mortgage other than (i) liens for taxes and
assessments not yet due and payable and (ii) Permitted Encumbrances insured to
be subordinate to this Mortgage), and endorsements insuring the priority of this
Mortgage over any mechanic’s lien.
6. Defaults and Remedies.
6.1 Events of Default. Trustor will be in default under this Mortgage upon the
occurrence of any Event of Default (as defined in the Credit Agreement or any
other Loan Document) or any other default herein (subject to any cure periods
applicable to defaults under the Loan Documents as provided in the Credit
Agreement).
6.2 Remedies. At any time after and during the continuance of an Event of
Default, and provided that Beneficiary has received any consents or approvals of
any other Lenders to the extent required under the Credit Agreement, Beneficiary
will be entitled to exercise any or all of the following rights and remedies and
any other rights and/or remedies available to Beneficiary at law or in equity
(subject to any restrictions on those rights and remedies imposed by applicable
Gaming Laws), all of which will be cumulative, and the exercise of any one or
more of which shall not constitute an election of remedies:
6.2.1 Acceleration. Beneficiary may declare any or all of the Secured
Obligations to be due and payable immediately without notice to or demand upon
Borrower, Trustor or any other person or entity. Trustor acknowledges that
Beneficiary and the Lenders are making one or more advances under the Credit
Agreement in reliance on the expertise, skill and

 

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experience of Borrower and Trustor; thus, the Secured Obligations include
material elements similar in nature to a personal service contract.
6.2.2 Receiver or Keeper. Beneficiary may apply to any court of competent
jurisdiction for, and obtain appointment of, a receiver or Keeper for the
Property; and Beneficiary, to the extent permitted by applicable law, may
request, in connection with any foreclosure proceeding hereunder, that the
Louisiana Gaming Control Board petition a District Court of the State of
Louisiana for the appointment of a supervisor to conduct the normal gaming
activities on the Property concurrently with or following such foreclosure
proceeding.
6.2.3 Entry. Beneficiary, in person, by agent or by court-appointed receiver or
Keeper, may enter, take possession of, manage and operate all or any part of the
Property, and may also do any and all other things in connection with those
actions that Beneficiary may in its absolute discretion consider necessary and
appropriate to protect the security of this Mortgage. Such other things may
include, without limitation: taking and possessing all of Trustor’s or the then
owner’s Books and Records; entering into, enforcing, modifying, or canceling
Leases on such terms and conditions as Beneficiary may consider proper;
obtaining and evicting tenants; collecting and receiving any payment of money
owing to Trustor; completing construction; and/or contracting for and making
repairs and alterations. If Beneficiary so requests, Trustor shall assemble all
of the Property that has been removed from the Land and make all of it available
to Beneficiary at the site of the Land. Trustor hereby irrevocably constitutes
and appoints Beneficiary as Trustor’s mandatory and attorney-in-fact (which
appointment is irrevocable and coupled with an interest) to perform such acts
and execute such documents as Beneficiary in its absolute discretion may
consider to be appropriate in connection with taking these measures, including
endorsement of Trustor’s name on any instruments. Regardless of any provision of
this Mortgage or the Credit Agreement, Beneficiary shall not be considered to
have accepted any personal or movable property in satisfaction of any obligation
of Trustor to Beneficiary unless Beneficiary has given express written notice of
Beneficiary’s election of that remedy in accordance with La. R.S. § 10:9-505, as
it may be amended or recodified from time to time.
6.2.4 Cure; Protection of Security. Beneficiary may cure any breach or default
of Trustor and, if it chooses to do so in connection with any such cure,
Beneficiary may also enter the Property and/or do any and all other things which
either may in its absolute discretion consider necessary and appropriate to
protect the security of this Mortgage. Such other things may include, without
limitation: appearing in and/or defending any action or proceeding which
purports to affect the security of, or the rights or powers of Beneficiary
under, this Mortgage; paying, purchasing, contesting or compromising any
encumbrance, charge, lien, security interest or claim of lien or security
interest which (in Beneficiary’s sole judgment) is or may be senior in priority
to this Mortgage, such judgment of Beneficiary to be conclusive as among the
parties to this Mortgage; obtaining insurance and/or paying any premiums or
charges for insurance required to be carried under this Mortgage and the other
Loan Documents; otherwise caring for and protecting, preserving, repairing or
recovering any and all of the Property; and/or employing counsel, accountants,
contractors and other appropriate persons to assist Beneficiary. Beneficiary may
take any of the actions permitted under this Section 6.2.4 upon giving Trustor
prior written notice of such action(s), or if Beneficiary has reasonably
determined that providing

 

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such prior written notice is not feasible, then substantially concurrent written
notice of such action(s).
6.2.5 Chapter 9 Remedies. Beneficiary may exercise any or all of the remedies
granted to a secured party under Chapter 9, as amended or recodified from time
to time.
6.2.6 Judicial Action. Beneficiary may bring an action in any court of competent
jurisdiction to foreclose this Mortgage or to obtain specific enforcement of any
of the covenants or other terms of this Mortgage.
6.2.7 Power of Sale. Beneficiary shall have the discretionary right to cause
some or all of the Property, including any Property which constitutes personal
property, to be sold or otherwise disposed of in any combination and in any
manner permitted by applicable law.
(a) Sales of Personal Property.
(i) Beneficiary may elect to treat as personal property any Property which is
intangible or which are fixtures, as defined in Chapter 9, which can be severed
from the Land or Improvements without causing structural damage. If it chooses
to do so, Beneficiary may dispose of any personal property separately from the
sale of immovable property, in any manner permitted by Chapter 9, as amended or
recodified from time to time, including any public or private sale, or in any
manner permitted by any other applicable law. Any proceeds of any such
disposition shall not cure any Event of Default.
(ii) In connection with any sale or other disposition of such Property, Trustor
agrees that the following procedures constitute a commercially reasonable sale:
Beneficiary shall mail written notice of the sale as required by Chapter 9. Once
per week during the three weeks immediately preceding such sale, Beneficiary
will publish notice of the sale in a local daily newspaper of general
circulation. Upon receipt of any written request, Beneficiary will make the
Property available to any bona fide prospective purchaser for inspection during
reasonable business hours. Notwithstanding any provision to the contrary,
Beneficiary shall be under no obligation to consummate a sale if, in its
judgment, none of the offers received by it equals the fair value of the
Property offered for sale. The foregoing procedures do not constitute the only
procedures that may be commercially reasonable.
6.2.8 Foreclosure Sales.
(a) For purposes of executory process under applicable Louisiana law, Trustor
hereby acknowledges the Secured Obligations, CONFESSES JUDGMENT thereon and
consents that judgment be rendered and signed, whether during the court’s term
or during vacation, in favor of the Beneficiary, for the full amount of the
Secured Obligations, including but not limited to the Notes, the Credit
Agreement, the other Loan Documents and the other Secured Obligations, in
principal, interest, costs and attorney’s fees, together with all charges and
expenses whatsoever owing pursuant to this Mortgage. Upon the occurrence and
during the continuance of an Event of Default, and in addition

 

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to all of its rights, powers and remedies under this Mortgage and applicable
law, Beneficiary may, at its option, cause all or any part of the Property to be
seized and sold (any such sale or disposition being referred to herein as a
“Foreclosure Sale”) under executory process or under writ of fieri facias issued
in execution of an ordinary judgment obtained upon the Secured Obligations,
without appraisement to the highest bidder, for cash or upon such terms as
Beneficiary deems acceptable. Trustor hereby waives all and every appraisement
of the Property and waives and renounces the benefit of appraisement and the
benefit of all laws relative to the appraisement of the Property seized and sold
under executory or other legal process. Trustor agrees to waive, and does hereby
specifically waive:
(i) the benefit of appraisement provided for in Articles 2332, 2336, 2723 and
2724, Louisiana Code of Civil Procedure, and all other laws conferring such
benefits;
(ii) the demand and three (3) days delay accorded by Articles 2639 and 2721,
Louisiana Code of Civil Procedure;
(iii) the notice of seizure required by Articles 2293 and 2721, Louisiana Code
of Civil Procedure;
(iv) the three (3) days delay provided by Articles 2331 and 2722, Louisiana Code
of Civil Procedure;
(v) the benefit of the other provisions of Articles 2331, 2722 and 2723,
Louisiana Code of Civil Procedure;
(vi) the benefit of the provisions of any other articles of the Louisiana Code
of Civil Procedure not specifically mentioned above; and
(vii) all pleas of division and discussion with respect to the Secured
Obligations.
In the event Beneficiary elects, at its option, to enter suite via ordinaria on
the Secured Obligations, in addition to the foregoing confession of judgment,
Trustor hereby waives citation, other legal process and legal delays and hereby
consents that judgment for the unpaid principal due on the Secured Obligations,
together with interest, attorneys’ fees, costs and other charges that may be due
on the Secured Obligations, be rendered and signed immediately.
(b) Pursuant to the authority contained in La. R.S. 9:5136 through 9:5140.2, as
the same may hereafter be amended or supplemented Trustor and Beneficiary do
hereby expressly designate Beneficiary or its designee to be keeper or receiver
(“Keeper”) for the benefit of Beneficiary or any assignee of Beneficiary, such
designation to take effect immediately upon any seizure of any of the Property
under writ of executory process or under writ of sequestration or fieri facias
as an incident to an action brought by Beneficiary. The Keeper shall be entitled
to a reasonable fee and to the reimbursement of all reasonable out-of-pocket
expenses incurred by it as Keeper, and the

 

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payment of such fees and expenses shall be secured by the mortgage, assignment
and security interest in the Property granted in this Mortgage.
6.2.9 Other Permitted Remedies. Beneficiary and the Lenders may refuse to make
any advance to, or issue any Letter of Credit for the account of Borrower or
Trustor. Beneficiary and the Lenders may exercise any and all other rights and
remedies available under the Loan Documents and applicable law, including,
without limitation, the right to file applications to change, and to exercise
all other rights and remedies available under applicable law with respect to,
all water permits and rights relating to the Property; provided, however, that,
notwithstanding the foregoing or any other provision contained in this Mortgage,
the remedies provided by this Mortgage shall not include the right to take any
action that violates applicable Gaming Laws.
6.3 Credit Bids. At any Foreclosure Sale, any person, including Trustor or
Beneficiary, may bid for and acquire the Property or any part thereof to the
extent permitted by then applicable law. Instead of paying cash for such
Property, Beneficiary may settle for the purchase price by crediting against the
sales price of the Property or any part thereof any or all of the outstanding
Secured Obligations (including without limitation the portion of the Secured
Obligations attributable to the expenses of sale, costs of any action and any
other sums for which Trustor is obligated to pay or reimburse Beneficiary or the
Lenders under Section 5.11) or otherwise in such order and proportions as
Beneficiary in its absolute discretion may choose.
6.4 Application of Foreclosure Sale Proceeds. Beneficiary shall apply the
proceeds of any Foreclosure Sale or other sale or disposition pursuant to
Section 6.2 hereof in the manner required by applicable law; provided that all
proceeds that are to be applied against the Secured Obligations shall, except as
otherwise required by applicable law, be applied against the Secured Obligations
in any order and proportions as Beneficiary in its absolute discretion may
choose (subject to any applicable provisions for priority of application of
proceeds set forth in the Credit Agreement).
6.5 Application of Rents and Other Sums. Beneficiary shall apply any and all
Rents collected by it, and any and all sums other than proceeds of a Foreclosure
Sale or other sale or disposition which Beneficiary may receive or collect under
Section 6.2, or otherwise, in the following manner:
(a) First, to pay the portion of the Secured Obligations attributable to the
costs and expenses of operation and collection that may be incurred by
Beneficiary or any receiver or Keeper;
(b) Second, to pay all other Secured Obligations in any order and proportions as
Beneficiary in its absolute discretion may choose (subject to the provisions for
priority of application of payments set forth in the Credit Agreement); and
(c) Third, to remit the remainder, if any, to the person or persons entitled to
it. Beneficiary shall have no liability for any funds which it does not actually
receive.

 

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7. Leasehold Mortgage Provisions. The provisions of this Article 7 shall apply
in the event that, and so long as, any portion of the Property consists of
Mortgagor’s interests as tenant under any lease or leases encumbered by this
Mortgage (collectively, including the Existing Ground Lease, the “Ground
Leases”). Unless otherwise expressly provided, the lien of this Mortgage shall
encumber all of Trustor’s rights and interests under and in connection with any
Ground Lease, including without limitation, renewal and extension rights,
options to expand, and purchase options (all of which rights shall be
collectively referred to herein as a “Ground Leasehold”). Trustor hereby agrees,
with respect to each Ground Lease, as follows:
7.1 Trustor shall timely perform its obligations in connection with each Ground
Lease. Without limiting the generality of Section 6.2.4 above, Trustor
specifically acknowledges Beneficiary’s right, while any default by Trustor
under any Ground Lease remains uncured, to perform the defaulted obligations and
take all other actions which Beneficiary deems necessary to protect its
interests with respect thereto, and Trustor hereby irrevocably appoints
Beneficiary its true and lawful attorney-in-fact (which appointment is
irrevocable and coupled with an interest) in its name or otherwise to execute
all documents, and perform all other acts, which Beneficiary reasonably deems
necessary to preserve its or Trustor’s rights with respect to any Ground Lease.
Any amounts advanced by Beneficiary pursuant to this Section shall be included
in the Secured Obligations.
7.2 Except as not prohibited by the Credit Agreement, Trustor shall not, without
Beneficiary’s prior written consent, modify, or cause or permit the termination
of, any Ground Lease, or waive or in any way release the landlord under any
Ground Lease of or from any obligation or condition.
7.3 Trustor shall notify Beneficiary promptly in writing of (i) the occurrence
of any material default by the landlord under any Ground Lease, and (ii) the
receipt by Trustor of any notice claiming the occurrence of any default by
Trustor under any Ground Lease or the occurrence of any event which, with the
passage of time or the giving of notice or both, would constitute a material
default by Trustor under any Ground Lease (and Trustor shall also promptly
deliver a copy of any such notice to Beneficiary) or would otherwise permit the
landlord under such Ground Lease to terminate the Ground Lease.
7.4 Unless Beneficiary otherwise consents in writing, so long as any Secured
Obligation remains outstanding, neither the fee title to, nor any other estate
or interest in, the real property subject to any Ground Lease shall merge with
any Ground Leasehold, notwithstanding the union of such estates in the landlord
or the tenant or in a third party. Any acquisition of the landlord’s interest in
any Ground Lease by Trustor or any affiliate of Trustor shall be accomplished in
such a manner as to avoid a merger of the interests of Landlord and tenant
unless Beneficiary consents to such merger in writing.
7.5 If Trustor acquires fee title to any portion of the real property subject to
any Ground Lease, this Mortgage shall automatically be a lien on such fee title.
7.6 Unless otherwise expressly obligated to do so by the terms and provisions of
any Lease (and then only to the extent of any such obligation), Trustor shall
not subordinate any Ground Lease or Ground Leasehold to any mortgage or other
encumbrance of, or lien on, any

 

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interest in the real property subject to such Ground Leasehold without the prior
written consent of Beneficiary. Any such prohibited subordination without such
consent shall, at Beneficiary’s option, be void.
7.7 All material subleases entered into by Trustor with respect to all or any
portion of the Property (and all existing subleases modified by Trustor) shall
provide that such subleases are subordinate to the lien of this Mortgage and any
modifications of this Mortgage and the obligations secured hereby and that, if
Beneficiary forecloses under this Mortgage or enters into a new lease with any
landlord under any Ground Lease pursuant to the provisions for a new lease, if
any, contained in the applicable Ground Lease or in any other document or
agreement, the subtenant shall attorn to Beneficiary or its assignee and the
sublease shall remain in full force and effect in accordance with its terms
notwithstanding the termination of the applicable Ground Lease.
7.8 Trustor shall exercise any option or right to renew or extend the term of
any Ground Lease prior to the date of termination of any such option or right,
shall give immediate written notice thereof to Beneficiary, and shall execute,
deliver and record any documents requested by Beneficiary to evidence the lien
of this Mortgage on such extended or renewed lease term unless such Ground Lease
is not renewed or extended as permitted pursuant to the Credit Agreement. If
Trustor fails to exercise any such option or right as required herein,
Beneficiary may exercise the option or right as Trustor’s agent and
attorney-in-fact pursuant to this Mortgage, or in Beneficiary’s own name or in
the name of and on behalf of a nominee of Beneficiary, as Beneficiary chooses in
its absolute discretion; provided, if Trustor shall fail to exercise any option
or right to renew or extend the term of any Ground Lease, Trustor shall give
Beneficiary reasonable prior notice. Beneficiary shall thereafter provide
Trustor prior written notice of such action(s), or if Beneficiary reasonably
determines that providing such prior written notice is not feasible, then
substantially concurrent written notice of such action(s).
7.9 As security for the Secured Obligations, Trustor hereby assigns to
Beneficiary a security interest in all prepaid rents and security deposits and
all other security which the landlords under the Ground Leases hold for the
performance of Trustor’s obligations thereunder.
7.10 Promptly upon demand by Beneficiary, Trustor shall use reasonable efforts
to obtain from the landlord under any Ground Lease and furnish to Beneficiary an
estoppel certificate of such landlord stating the date through which rent has
been paid, whether or not there are any defaults, and the specific nature of any
claimed defaults.
7.11 Intentionally Deleted.
7.12 To the extent permitted by law, the price payable by Trustor or any other
party in the exercise of the right of redemption, if any, from any sale under,
or decree of foreclosure of, this Mortgage shall include all rents and other
amounts paid and other sums advanced by Beneficiary on behalf of Trustor as the
tenant under the Ground Leases.
7.13 In addition to all other Events of Default described in this Mortgage, the
occurrence of any of the following shall be an Event of Default hereunder:

 

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(a) A breach or default by Trustor under any Ground Lease, subject to any
applicable cure period; or
(b) The occurrence of any event or circumstance which gives the landlord under
any Ground Lease a right to terminate such Ground Lease.
7.14 As used in this Mortgage, the “Bankruptcy Code” shall mean 11 U.S.C. §§
101, et seq., as modified and/or recodified from time to time. Notwithstanding
anything to the contrary contained herein with respect to any Ground Lease:
(a) The lien of this Mortgage attaches to all of Trustor’s rights under
subsection 365(h) of the Bankruptcy Code, including without limitation, any and
all elections to be made thereunder, any and all rights under any Ground Lease
which Trustor is entitled to retain pursuant to 11 U.S.C. § 365(h)(1)(A)(ii) in
the event of a rejection under the Bankruptcy Code of such Ground Lease by the
landlord thereunder (or any trustee thereof), and any and all rights of offset
under or as described in 11 U.S.C. § 365(h)(1)(B).
(b) Trustor acknowledges and agrees that, by the terms hereof and by operation
of 11 U.S.C. § 365(h)(1)(D), Beneficiary has, and until this Mortgage has been
fully reconveyed continuously shall have, whether before or after any default
under any of the Secured Obligations or the taking of any action to enforce any
of Beneficiary’s rights and remedies under this Mortgage or any foreclosure sale
hereunder, the complete, unfettered and exclusive right, in its sole and
absolute discretion, to elect (the “365(h) Election”) whether (i) any Ground
Lease that has been rejected under the Bankruptcy Code by the landlord
thereunder (or any trustee therefor) shall be treated as terminated under 11
U.S.C. § 365(h)(1)(A)(i), or (ii) the rights under such Ground Lease that are in
or appurtenant to the real property, as described in 11 U.S.C. §
365(h)(1)(A)(ii), should be retained pursuant to that subsection. To the extent
that, notwithstanding the preceding sentence and 11 U.S.C. § 365(h)(1)(D),
Trustor now or at any time in the future has any right to make, or to
participate in or otherwise in any manner affect the making of, the 365(h)
Election with respect to any Ground Lease, Trustor hereby absolutely assigns and
conveys to Beneficiary any and all such rights, and all of Trustor’s right,
title and interest therein, which may be used and exercised by Beneficiary
completely, exclusively, and without any restriction whatsoever, in
Beneficiary’s sole and absolute discretion, whether before or after any default
upon any of the Secured Obligations, the taking of any action to enforce any of
Beneficiary’s rights and remedies under this Mortgage, or any foreclosure sale
hereunder. Trustor hereby unconditionally and irrevocably appoints Beneficiary
as its attorney-in-fact (which appointment is coupled with an interest) to
exercise Trustor’s right, if any, to make, or participate in, or otherwise in
any matter affecting the making of, the 365(h) Election with respect to any
Ground Lease. Trustor shall not in any manner impede or interfere with any
action taken by Beneficiary and, at the request of Beneficiary, Trustor shall
take or join in the taking of any action to make, or participate in or otherwise
in any manner affect the making of, the 365(h) Election with respect to any
Ground Lease; provided such action and such Election are consistent with all
applicable Laws, in such manner as Beneficiary determines in its sole and
absolute discretion. Unless and until instructed to do so by Beneficiary (as
determined by

 

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Beneficiary in its sole and absolute discretion), Trustor shall not take any
action to make, or participate in or otherwise in any manner affect the making
of, the 365(h) Election with respect to any Ground Lease, including in
particular, but without limitation, any election to treat any Ground Lease as
terminated. Beneficiary shall have no obligation whatsoever to Trustor or any
other person or entity in connection with the making of the 365(h) Election with
respect to any Ground Lease or any instruction by Beneficiary to Trustor given,
withheld or delayed in respect thereof, nor shall Beneficiary have any liability
to Trustor or any other person or entity arising from any of the same.
(c) As security for the Secured Obligations, Trustor hereby irrevocably assigns
to Beneficiary all of Trustor’s rights to damages arising from any rejection by
any landlord (or any trustee thereof) of any Ground Lease under the Bankruptcy
Code. Beneficiary and Trustor shall proceed jointly or in the name of Trustor in
respect of any claim or proceeding relating to the rejection of any Ground
Lease, including without limitation, the right to file and prosecute any proofs
of claim, complaints, motions and other documents, provided the same shall be
well grounded in fact or law, in any case in respect of such landlord under the
Bankruptcy Code. This assignment shall continue in effect until all of the
Secured Obligations have been satisfied in full. Any amounts received by
Beneficiary or Trustor as damages arising from the rejection of any Ground Lease
as aforesaid shall be applied first to all costs reasonably incurred by
Beneficiary (including attorneys’ fees) in connection with this subsection
(c) and then in accordance with other applicable provisions of this Mortgage.
(d) If, pursuant to the Bankruptcy Code, Trustor seeks to offset against the
rent reserved in any Ground Lease the amount of any damages caused by the
nonperformance of the landlord’s obligations after the rejection by the landlord
(or any trustee thereof) of such Ground Lease, Trustor shall, prior to effecting
such offset, notify Beneficiary in writing of its intent to do so, setting forth
the amounts proposed to be offset and, in the event that Beneficiary objects,
Trustor shall not effect any offset of the amounts to which Beneficiary objects.
If Beneficiary fails to object within 10 days following receipt of such notice,
Trustor may offset the amounts set forth in Trustor’s notice.
(e) If any legal proceeding is commenced with respect to any Ground Lease in
connection with any case under the Bankruptcy Code, Beneficiary and Trustor
shall cooperatively conduct any such proceeding with counsel reasonably agreed
upon between Trustor and Beneficiary. Trustor shall, upon demand, pay to
Beneficiary all costs (including attorneys’ fees) reasonably incurred by
Beneficiary in connection with any such proceeding.
(f) Trustor shall immediately notify Beneficiary orally upon learning of any
filing by or against any landlord of a petition under the Bankruptcy Code.
Trustor shall thereafter promptly give written notice of such filing to
Beneficiary, setting forth any information available to Trustor with respect to
the date of such filing, the court in which such petition was filed, and the
relief sought therein. Trustor shall promptly deliver to Beneficiary all
notices, pleadings and other documents received by Trustor in connection with
any such proceeding.

 

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7.15 No maintenance, repair or other obligation of Trustor hereunder which
relates to the “Property” shall apply to any Ground Leasehold with respect to
which the applicable Ground Lease imposes such obligation on the landlord so
long as (a) Trustor does not own the landlord’s interest; (b) such landlord is
performing such obligation in accordance with the terms of such Ground Lease;
and (c) the Ground Lease has not been rejected by the landlord (or any trustee
thereof) under the Bankruptcy Code.
7.16 The generality of the provisions of this Mortgage shall not be limited by
any provision of this Article 7 that sets forth particular obligations of
Trustor as the tenant under the Ground Leases.
7.17 Trustor hereby represents and warrants to Beneficiary as follows:
(a) The Ground Leases are in full force and effect;
(b) Trustor owns the entire tenant’s interest under the Ground Leases and has
the right under the Ground Leases to execute this Mortgage; and
(c) No default under the Existing Ground Leases remains uncured, nor has any
event occurred which, with the passage of time or service of notice or both,
would constitute such a default.
7.18 Upon the expiration of any Ground Lease, or any early termination by
Trustor of such Ground Lease as provided herein, Beneficiary agrees to release
the parcel leased pursuant such Ground Lease from the Property and any lien
secured on the parcel leased pursuant such Ground Lease by this Mortgage.
8. Suretyship Provisions. The following provisions shall apply to the extent
that all or any portion of the obligations secured hereby now or hereafter
constitute obligations of person(s) other than, or in addition to, Trustor,
including, without limitation, the Borrower:
8.1 Conditions to Exercise of Rights. Trustor hereby waives any right it may now
or hereafter have to require Beneficiary, as a condition to the exercise of any
remedy or other right against Trustor hereunder or under any other document
executed by Trustor in connection with any Secured Obligation, (a) to proceed
against Borrower or any other person, or against any other collateral assigned
to or encumber in favor of Beneficiary by Trustor or Borrower or any other
person, (b) to pursue any other right or remedy in Beneficiary’s power, (c) to
give notice of the time, place or terms of any public or private sale of real or
personal property collateral assigned to or encumber in favor of Beneficiary by
Borrower or any other person (other than Trustor), or otherwise to comply with
La. R.S. § 10:9-504 (as modified or recodified from time to time) with respect
to any such personal property collateral, or (d) to make or give (except as
otherwise expressly provided in the Loan Documents) any presentment, demand,
protest, notice of dishonor, notice of protest or other demand or notice of any
kind in connection with any Secured Obligation or any collateral (other than the
Property) for any Secured Obligation. Trustor also waives any defense in any way
related to the foregoing.
8.2 Waiver of Defenses. Trustor hereby waives any defense it may now or
hereafter have that relates to: (a) any disability or other defense of Borrower
or any other person; (b) the

 

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cessation, from any cause other than full performance, of the obligations of
Borrower or any other person; (c) the application of the proceeds of any Secured
Obligation, by Borrower or any other person, for purposes other than the
purposes represented to Trustor by Borrower or otherwise intended or understood
by Trustor or Borrower; (d) any act or omission by Beneficiary which directly or
indirectly results in or contributes to the release of Borrower or any other
person or any collateral for any Secured Obligation; (e) the unenforceability or
invalidity of any collateral assignment or encumbrance (other than this
Mortgage) or guaranty with respect to any Secured Obligation, or the lack of
perfection or continuing perfection or lack of priority of any lien which
secures any Secured Obligation; (f) any failure of Beneficiary to marshal assets
in favor of Trustor or any other person; (g) any modification of any Secured
Obligation, including any renewal, extension, acceleration or increase in
interest rate, or (h) any election of remedies by Beneficiary that impairs any
subrogation or other right of Trustor to proceed against Borrower or any other
person, including any loss of rights resulting from deficiency judgment laws
relating to foreclosures of immovable property or other laws limiting,
qualifying or discharging obligations or remedies (including La. R.S. §§ 13:4106
through 13:4108.3, inclusive, as modified or recodified from time to time);
(l) any law which provides that the obligation of a surety or guarantor must
neither be larger in amount nor in other respects more burdensome than that of
the principal or which reduces a surety’s or guarantor’s obligation in
proportion to the principal obligation; (j) any failure of Beneficiary to file
or enforce a claim in any bankruptcy or other proceeding with respect to any
person; (k) the election by Beneficiary, in any bankruptcy proceeding of any
person, of the application or non-application of Section 1111(b)(2) of the
United States Bankruptcy Code; (I) any extension of credit or the grant of any
lien under Section 364 of the United States Bankruptcy Code; (m) any use of cash
collateral under Section 363 of the United States Bankruptcy Code; or (n) any
agreement or stipulation with respect to the provision of adequate protection in
any bankruptcy proceeding of any person.
The Trustor waives all rights and defenses that the Trustor may have because
Borrower’s debt is secured by immovable property. This means, among other
things:

  (1)  
The Beneficiary may foreclose, under this Mortgage, without first foreclosing on
any immovable or personal property collateral pledged by Borrower or any other
person.
    (2)  
If the Beneficiary forecloses on any immovable property collateral pledged or
otherwise encumbered by Borrower or any other person:

  (A)  
The amount of the Secured Obligations may be reduced only by the price for which
that collateral is sold at the foreclosure sale, even if the collateral is worth
more than the sale price.

  (B)  
The Beneficiary may foreclose on any such immovable property collateral even if
the Beneficiary, by foreclosing on such immovable property

 

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collateral, has destroyed any right the Trustor may have to collect from
Borrower or any other person.

This is an unconditional and irrevocable waiver of any and all rights and
defenses the Trustor may have because Borrower’s debt is secured by immovable
property.
The Trustor also waives all rights and defenses arising out of an election of
remedies by the Beneficiary, even though that election of remedies, such as a
foreclosure with respect to security for a guaranteed obligation, has destroyed
the Trustor’s rights of subrogation and reimbursement against the principal by
operation of applicable law or otherwise.
8.3 Subrogation. Trustor hereby waives, until such time as all Secured
Obligations are fully paid and performed, (a) all rights of subrogation against
Borrower or any other person that relates to any Secured Obligation, (b) all
rights to enforce any remedy Beneficiary may now or hereafter have against
Borrower or any other person, and (c) all rights to participate in any
collateral now or hereafter assigned to Beneficiary with respect to any Secured
Obligation.
8.4 Trustor Information. Trustor warrants and agrees that: (a) Trustor has not
relied, and will not rely, on any representations or warranties by Beneficiary
to Trustor with respect to the creditworthiness of Borrower or any other person
or the prospects of repayment of any Secured Obligation from sources other than
the Property; (b) Trustor has established and/or will establish adequate means
of obtaining from Borrower and each other person liable, directly or through a
guaranty or pledge or encumbrance of collateral, for the repayment of the
Secured Obligations, on a continuing basis financial and other information
pertaining to the business operations, if any, and financial condition of
Borrower and each such other person; (c) Trustor assumes full responsibility for
keeping informed with respect to the business operations, if any, and financial
condition of Borrower and each such other person; and (d) Beneficiary shall have
no duty to disclose or report to Trustor any information now or hereafter known
to Beneficiary or any of the Lenders with respect to Borrower or other person,
including, without limitation information relating to Borrower’s or other
person’s business operations or financial condition.
8.5 Other Rights of Sureties. Trustor hereby waives all other rights it may now
or hereafter have, whether or not similar to any, of the foregoing, by reason of
laws of the State of Louisiana pertaining to sureties or suretyship.
8.6 Reinstatement of Lien. Beneficiary’s rights hereunder shall be reinstated
and revived, and the enforceability of this Mortgage shall continue, with
respect to any amount at any time paid on account of any Secured Obligation
which Beneficiary is thereafter required to restore or return in connection with
a bankruptcy, insolvency, reorganization or similar proceeding with respect to
Borrower or any other person.
8.7 Subordination. Until all of the Secured Obligations have been fully paid and
performed, (a) Trustor hereby agrees that all existing and future indebtedness
and other obligations of Borrower and of each “other person” described in
Section 8.3 or 8.4 hereof to Trustor (collectively, the “Subordinated Debt”)
shall be and are hereby subordinated to all Secured Obligations which constitute
obligations of Borrower or other person, and the payment

 

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thereof is hereby deferred in right of payment to the prior payment and
performance of all Secured Obligations; (b) unless an Event of Default has
occurred and is continuing, Trustor shall not collect or receive any cash or
non-cash payments on any Subordinated Debt or transfer all or any portion of the
Subordinated Debt; and (c) in the event that, notwithstanding the foregoing, any
payment by, or distribution of assets of, Borrower or other person, with respect
to any Subordinated Debt is received by Trustor, such payment or distribution
shall be held in trust and immediately paid over to Beneficiary, is hereby
assigned to Beneficiary as security for the Secured Obligations, and shall be
held by Beneficiary in a non-interest bearing account until all Secured
Obligations have been fully paid and performed.
8.8 Lawfulness and Reasonableness. Trustor warrants that all of the waivers in
this Mortgage are made with full knowledge of their significance, and of the
fact that events giving rise to any defense or other benefit waived by Trustor
may destroy or impair rights which Trustor would otherwise have against
Beneficiary, other Lenders, Borrower and other persons, or against collateral.
Trustor agrees that all such waivers are reasonable under the circumstances and
further agrees that, if any such waiver is determined (by a court of competent
jurisdiction) to be contrary to any law or public policy, such waiver shall be
effective to the fullest extent permitted by law.
9. Miscellaneous Provisions.
9.1 Additional Provisions. The Loan Documents fully state all of the terms and
conditions of the parties’ agreement regarding the matters mentioned in or
incidental to this Mortgage. The Loan Documents also grant further rights to
Beneficiary and contain further agreements and affirmative and negative
covenants by Trustor which apply to this Mortgage and to the Property. If there
is a conflict between the terms of this Mortgage and the terms of the Credit
Agreement, the terms of the Credit Agreement shall control.
9.2 No Waiver or Cure.
9.2.1 Each waiver by Beneficiary must be in writing, and no waiver shall be
construed as a continuing waiver. No waiver shall be implied from any delay or
failure by Beneficiary to take action on account of any default of Trustor.
Consent by Beneficiary to any act or omission by Trustor shall not be construed
as a consent to any other or subsequent act or omission or to waive the
requirement for Beneficiary’s consent to be obtained in any future or other
instance.
9.2.2 If any of the events described below occurs, that event alone shall not:
cure or waive any breach, Event of Default or notice of default under this
Mortgage or invalidate any act performed pursuant to any such default or notice;
or nullify the effect of any notice of default or sale (unless all Secured
Obligations then due have been paid and performed in full and all other defaults
under the Loan Documents have been cured); or impair the security of this
Mortgage; or prejudice Beneficiary or any receiver or Keeper in the exercise of
any right or remedy afforded any of them under this Mortgage; or be construed as
an affirmation by Beneficiary of any tenancy, Lease or option, or a
subordination of the lien, encumbrance or security interest of this Mortgage:

 

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(a) Beneficiary, its agent or a receiver or Keeper takes possession of all or
any part of the Property in the manner provided in Section 6.2.3 or otherwise.
(b) Beneficiary or a receiver or Keeper collects and applies Rents as permitted
under Sections 2.3 and 6.5 or exercises Trustor’s right, title and interest
under the Leases, either with or without taking possession of all or any part of
the Property.
(c) Beneficiary receives and applies to any Secured Obligation proceeds of any
Property, including any proceeds of insurance policies, condemnation awards, or
other claims, property or rights assigned to or encumber in favor of Beneficiary
under Section 1.1 or 5.5 or otherwise; provided such application is in
accordance with the provisions of the Credit Agreement.
(d) Beneficiary makes a site visit, observes the Property and/or conducts tests
as permitted under Section 5.15.
(e) Beneficiary receives any sums under this Mortgage or any proceeds of any
collateral held for any of the Secured Obligations, and applies them to one or
more Secured Obligations.
(f) Beneficiary, or any receiver or Keeper invokes any right or remedy provided
under this Mortgage.
9.3 Powers of Beneficiary.
9.3.1 [Intentionally Left Blank.]
9.3.2 If Beneficiary performs any act which it is empowered or authorized to
perform under this Mortgage, including, without limitation, any act permitted by
Section 5.9 or Section 6.2.4, that act alone shall not release or change the
personal liability of any person for the payment and performance of the Secured
Obligations then outstanding, or the lien or encumbrance or security interest of
this Mortgage on all or the remainder of the Property for full payment and
performance of all outstanding Secured Obligations. The liability of the
original Trustor shall not be released or changed if Beneficiary grants any
successor in interest to Borrower or Trustor any extension of time for payment,
or modification of the terms of payment, of any Secured Obligation. Beneficiary
shall not be required to comply with any demand by the original Trustor that
Beneficiary refuse to grant such an extension or modification to, or commence
proceedings against, any such successor in interest.
9.3.3 Beneficiary may take any of the actions permitted under Sections 6.2.2
and/or 6.2.3 regardless of the adequacy of the security for the Secured
Obligations, or whether any or all of the Secured Obligations have been declared
to be immediately due and payable, or whether notice of default and election to
sell has been given under, or notice of seizure given with respect to, this
Mortgage.
9.3.4 From time to time, Beneficiary may apply to any court of competent
jurisdiction for aid and direction in enforcing the rights and remedies created
under this

 

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Mortgage. Beneficiary may from time to time obtain orders or decrees directing,
confirming or approving acts in enforcing these rights and remedies.
9.4 Merger. No merger shall occur as a result of Beneficiary’s acquiring any
other estate in or any other lien on or security interest in the Property unless
Beneficiary consents to a merger in writing.
9.5 Applicable Law. This Mortgage shall be governed by and construed in
accordance with the laws of the State of Louisiana.
9.6 Successors in Interest. The terms, covenants and conditions of this Mortgage
shall be binding upon and inure to the benefit of the heirs, successors and
assigns of the parties.
9.7 Interpretation.
9.7.1 Whenever the context requires, all words used in the singular will be
construed to have been used in the plural, and vice versa, and each gender will
include any other gender. The captions of the sections of this Mortgage are for
convenience only and do not define or limit any terms or provisions. The word
“include(s)” means “include(s), without limitation,” and the word “including”
means “including, but not limited to.” The word “person” includes individuals
and entities.
9.7.2 The word “obligations” is used in its broadest and most comprehensive
sense, and includes all primary, secondary, direct, indirect, fixed and
contingent obligations. It further includes all principal, interest,
reimbursement and indemnity obligations, prepayment charges, late charges, loan
fees and any other fees and charges accruing or assessed at any time, as well as
all obligations to perform acts or satisfy conditions.
9.7.3 No listing of specific instances, items or matters in any way limits the
scope or generality of any language of this Mortgage. All Exhibits and/or
Schedules attached to this Mortgage are hereby incorporated in this Mortgage.
9.8 In-House Counsel Fees. Whenever Trustor is obligated to pay or reimburse
Beneficiary for reasonable attorneys’ fees, those fees shall include the
allocated costs for services of in-house counsel.
9.9 Waiver of Marshalling. To the extent permitted by applicable law, Trustor
waives all rights, legal and equitable, it may now or hereafter have to require
marshalling of assets or to require foreclosure sales of assets in a particular
order. Each successor and assign of Trustor, including any holder of a lien or
encumbrance or security interest subordinate to this Mortgage, by acceptance of
its interest or lien or encumbrance or security interest, agrees that it shall
be bound by the above waiver, as if it had given the waiver itself.
9.10 Severability. Any provision in this Mortgage that is held to be
inoperative, unenforceable or invalid as to any party or circumstance or in any
jurisdiction shall, as to that party or circumstance or jurisdiction, be
inoperative, unenforceable or invalid without affecting the remaining provisions
or the operation, enforceability or validity of that provision as to any

 

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other party or circumstance or in any other jurisdiction, and to this end the
provisions of this Mortgage are declared to be severable.
9.11 Statute of Frauds Clause. Oral agreements or commitments to loan money,
extend credit or to forbear from enforcing repayment of a debt including
promises to extend or renew such debt are not enforceable. To protect you
(borrower(s)) and us (creditor) from misunderstanding or disappointment, any
agreements we reach covering such matters are contained in this writing, which
is the complete and exclusive statement of the agreement between us, except as
we may later agree in writing to modify it.
9.12 Assignment of Rents After Commencement of Foreclosure. The right of
Beneficiary to collect and receive the Rents or to take possession of the
Property, or to exercise any of the rights or powers herein granted to
Beneficiary shall, to the extent not prohibited by law, also extend to the
period from and after the filing of any suit to foreclose the lien of this
Mortgage, including any period allowed by law for the redemption of the Property
after any foreclosure sale.
9.13 Continuation of Foreclosure. In the event any foreclosure advertisement is
running or has run at the time of an appointment of a substitute Trustee, the
substitute Trustee may, to the extent permitted by applicable law, consummate
the advertised sale without the necessity of republishing such advertisement.
9.14 Notices. Trustor hereby requests that a copy of all notices required
hereunder or by applicable law be mailed to it at the address set forth below.
That address is also the mailing address of Trustor as debtor under Chapter 9,
as amended or recodified from time to time. Beneficiary’s address given below is
the address for Beneficiary as secured party under Chapter 9, as amended or
recodified from time to time.

     
Address Where
  Address Where
Notices to Trustor
  Notices to Beneficiary
Are to Be Sent:
  Are to Be Sent:

9.15 Waiver of Trial by Jury. To the extent permitted by law, Trustor and
Beneficiary hereby waive trial by jury in any action, proceeding or counterclaim
brought by either party against the other on any matter arising our of on in any
way connected with this Mortgage.

 

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THUS DONE AND PASSED, in the State of California, County of Los Angeles, on the
 _____  day of                     , 2010, in the presence of the undersigned
competent witnesses, who hereunder sign their names with Trustor and me, Notary,
after due reading of the whole.

                          WITNESSES:       TRUSTOR:    
 
                       
 
          By:                                  
 
              Name:        
 
                 
 
   
 
              Title:                              
NOTARY PUBLIC
                       
My Commission Expires:
                       
 
                       

 

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THUS DONE AND PASSED, in the State of California, County of Los Angeles, on the
 _____  day of                     , 2010, in the presence of the undersigned
competent witnesses, who hereunder sign their names with Trustor and me, Notary,
after due reading of the whole.

                          WITNESSES:       BENEFICIARY:    
 
                                    BARCLAYS BANK PLC
as Administrative Agent    
 
                       
 
          By:                                  
 
              Name:        
 
                 
 
   
 
              Title:                              
NOTARY PUBLIC
                       
My Commission Expires:
                       
 
                       

 

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EXHIBIT A to MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND
COLLATERAL ASSIGNMENT OF PROCEEDS executed as of                     , 2010 by
                    , a Louisiana corporation, as “Trustor”, in favor of
BARCLAYS BANK PLC, in its capacity as Administrative Agent, as “Beneficiary.”
PROPERTY DESCRIPTION

 

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EXHIBIT D
FORM OF
PREFERRED SHIP MORTGAGE
THIS PREFERRED SHIP MORTGAGE (“Mortgage”) on the vessel                      No.
                    , dated                     , 20_____, is made by
                    , a Louisiana corporation (“Owner”), in favor of BARCLAYS
BANK PLC, in its capacity as Administrative Agent (herein, “Mortgagee”) for the
benefit of itself and the “Lenders” party to the Credit Agreement as defined
below (such parties being referred to herein collectively and individually as
“Lenders”). Any capitalized term used herein and not defined herein shall have
the meaning ascribed thereto in the Credit Agreement (as defined below in
Recital D).
RECITALS
A. Owner is the sole owner of the whole of the Vessel named (and as defined)
herein and a subsidiary of Pinnacle Entertainment, Inc., a Delaware corporation
(“Borrower”), and has agreed to give this Mortgage as security for the Secured
Obligations described below.
B. The total amount of this Mortgage is $                     plus interest and
performance of mortgage covenants and the discharge amount is the same as the
total amount.
C. Borrower is a party to that certain Third Amended and Restated Credit
Agreement, dated as of February _____, 2010 (the “Credit Agreement”), among the
Borrower, the lenders party thereto (the “Existing Lenders”), and the Mortgagee,
as administrative agent for such Existing Lenders, under which Borrower borrowed
funds pursuant to a revolving credit facility and term loans as provided in the
Credit Agreement.
F. It is a condition precedent to the extension of credit facilities under the
Credit Agreement that this Mortgage be executed to provide security for Owner’s
“Guarantied Obligations” under that certain Second Amended and Restated
Subsidiary Guaranty dated as of December 14, 2005 (the “Subsidiary Guaranty”),
made by the Owner and other “Guarantors” (as defined therein) in favor of the
Lenders (the “Secured Obligations”). Owner expects to realize direct and
indirect benefits as the result of the availability of the aforementioned credit
facilities to Borrower.
AGREEMENT
NOW, in consideration of the premises and for other good and valuable
consideration, receipt of all of which is acknowledged, and to secure payment of
the Secured Obligations and the performance of all covenants relating hereto and
thereto, Owner mortgages and conveys unto Mortgagee, its successors and assigns,
the whole of the Vessel named (and as defined) below and as further described in
the most recent Certificate of Documentation issued and identified as follows:

                         
Name of Vessel:
               
 
                       
Official No.:
      Gross Tons:       Net Tons:        
 
 
 
     
 
     
 
   
 
                       
Certificate issued by:
                                             

 

 

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Date of Issuance:
                                     

together with (i) all masts, boilers, cables, engines, machinery, bowsprits,
sails, rigging, anchors, chains, tackle, apparel, furniture, fittings, tools,
pumps, equipment, radar, sonar, navigational devices and supplies, and all
fishing and other appurtenances and accessories and additions, improvements and
replacements whether on board or removed, (ii) the foregoing Certificate of
Documentation, which is included herein by reference, and (iii) all earnings,
freight, sub-freights, charter hires and sub-charter hires, if any, all of which
shall be included in the term “Vessel”;
TO HAVE AND TO HOLD all and singular the Vessel unto Mortgagee, its successors
and assigns, forever, upon the terms herein set forth for the enforcement of the
Secured Obligations, including, without limitation, to secure performance of,
and compliance with all agreements, covenants, terms and conditions in, this
Mortgage and the Subsidiary Guaranty;
PROVIDED, HOWEVER, this Mortgage shall cease, if Owner, or its successors or
assigns (i) perform and observe all and singular the terms, covenants and
agreements secured hereby and set forth herein, (ii) cease to be a Subsidiary as
a result of a transaction permitted under the terms of the Credit Agreement, or
(iii) secure a release of this Mortgage in accordance with Section 10.l5 of the
Credit Agreement; otherwise this Mortgage is to remain in full force and effect.
Nothing in any agreement or other document evidencing the Secured Obligations or
in any other agreement between the parties shall be deemed a waiver by Mortgagee
of any of the benefits of Chapter 313 of Title 46, U.S. Code (“Chapter 313”)
unless such waiver is contained in a written agreement specifically stating that
it is the intention of the Mortgagee to waive such benefits.
Owner agrees to perform the Secured Obligations, with interest as provided by
the terms thereof, and to perform and observe the further terms, covenants and
agreements contained herein, and to hold the Vessel subject thereto.
Owner is organized and is and shall continue in good standing under the laws of
the State of Louisiana and is authorized to do business and is in good standing
in each other state where the nature of Owner’s activities (including, without
limitation, operation of the Vessel) requires it to be so authorized and in good
standing, except where failure to so qualify or be in good standing would not
constitute a Material Adverse Effect.
ARTICLE I.
PARTICULAR COVENANTS OF OWNER
Owner covenants:
1.1 Owner is and continues to be a citizen of the United States entitled to own
and operate the Vessel under her certificate of documentation, which Owner shall
maintain in full force and effect. All actions necessary for the execution,
delivery and performance of this Mortgage and the Subsidiary Guaranty have been
duly taken, and each such agreement or instrument is the valid and legally
binding obligation of Owner and enforceable against Owner according to its
respective terms.

 

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1.2 Owner lawfully owns and possesses the Vessel free from all liens and
encumbrances whatsoever (except as may be expressly permitted by the terms
hereof or of the Credit Agreement) and shall warrant and defend title to and
possession of all and every part for the benefit of Mortgagee against all
persons, subject to Liens permitted under Section 7.3 of the Credit Agreement.
Owner shall not set up against Mortgagee and/or any assignee of this Mortgage
any claim of Owner against Mortgagee and/or assignee under any past or future
transaction.
1.3 All risk of loss, damage or destruction to or arising from the Vessel shall
at all times be on Owner. Owner shall maintain at all times throughout the term
of this Mortgage and at Owner’s sole expense, the policies of insurance required
to be maintained by the Owner pursuant to the terms of the Credit Agreement,
which shall additionally insure the Vessel. The insurance required hereby shall
be in such amounts, against such risks, in such form and with such insurers as
responsible companies engaged in similar businesses and owning similar assets
would maintain and shall otherwise be satisfactory to Mortgagee. In no event
shall Mortgagee be responsible for premiums, warranties, conditions or
representations to any insurer or any agent thereof. The insurance maintained by
Owner shall be primary without any right of contribution from insurance which
may be maintained by Mortgagee. Owner shall furnish to Mortgagee a certificate
or other evidence satisfactory to Mortgagee that such insurance coverage is in
effect. However, Mortgagee shall be under no duty to ascertain the existence or
adequacy of such insurance.
1.4 Owner shall comply with and shall not permit the Vessel to be operated
contrary to any provision of the insurance policies covering the Vessel or
contrary to any provision of laws, treaties, conventions, rules, regulations or
orders of the United States, any state and/or any other jurisdiction where
operated. Owner shall not abandon the Vessel in any foreign port, nor, without
the prior written consent of Mortgagee, permit the Vessel to venture outside the
territorial waters of the United States. Unless otherwise permitted under the
Credit Agreement, Owner shall do everything necessary from time to time to
establish and maintain this Mortgage as a Preferred Ship Mortgage pursuant to
Chapter 313.
1.5 Owner agrees to indemnify and hold Mortgagee harmless from and against any
and all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments or suits (and all costs, fees and expenses related thereto), arising
out of or related to this Mortgage, the Vessel, or Mortgagee’s interest therein
and the manufacture, purchase, possession, use, selection, operation or
condition of the Vessel or any part thereof.
1.6 Neither the Owner nor any agent, master or charterer has the right, power or
authority to create, incur or permit to be placed or imposed on the Vessel in
whole or in part any lien other than for Mortgagee or for crew’s wages or
salvage and other than Liens permitted under the Credit Agreement.
1.7 Owner will carry or cause to be carried a properly certified copy of this
Mortgage on board the Vessel with the documents of the Vessel to be exhibited to
any and all persons having business with the Vessel which might give rise to a
maritime lien thereon or to any sale, conveyance, mortgage or lease thereof, and
to any representative of Mortgagee; and will cause to be placed and kept
prominently displayed in the chart room and in the Master’s cabin of the Vessel
a notice, framed under glass, typewritten in plain type of such size that the
paragraph

 

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of reading matter shall cover a space not less than six inches wide and nine
inches high, reading as follows:
“NOTICE OF PREFERRED SHIP MORTGAGE
This vessel is owned by                     , a                     
corporation, and is subject to a Preferred Ship Mortgage in favor of Barclays
Bank PLC (and its successors and assigns in such capacity), as Mortgagee in its
capacity as Administrative Agent for itself and the Lenders party to a certain
credit facility. Under the terms of the Preferred Ship Mortgage, neither the
owner, any charterer, the master, nor any other person has the right, power or
authority to create, incur or permit to be placed or imposed upon this vessel,
its freight, profits or hire, any lien whatsoever, other than the liens
explicitly permitted by the terms of the Preferred Ship Mortgage.”
1.8 Owner shall pay, when due, all taxes, assessments, governmental charges,
fines and penalties lawfully imposed and promptly, discharge any and all Liens
upon the Vessel, other than taxes, assessments, governmental charges, fines and
penalties and Liens which are being contested in good faith by appropriate
proceedings and as to which adequate reserves have been established and
maintained in conformity with GAAP so long as the Vessel is not in jeopardy of
being seized, levied upon or forfeited as a result of such unpaid tax,
assessment, governmental charge or Lien. Except as permitted by Section 6.5 of
the Credit Agreement, Owner shall, at its own expense, at all times maintain the
Vessel in thorough repair and working order and shall make all proper renewals
and replacements. Except as permitted by Section 6.5 of the Credit Agreement,
Owner shall, at its own expense, at all times maintain and preserve the Vessel
and all its equipment, outfit and appurtenances tight, staunch, strong, in good
condition, working order and repair and (to the extent necessary or desirable
for its present use) in all respects seaworthy, and if classed by the American
Bureau of Shipping or other classification society, will keep the Vessel in such
condition as to entitle her to such classification. Owner shall immediately
notify Mortgagee of any casualty or damage to the Vessel in an amount equal to
or in excess of $500,000, or of the disappearance thereof.
1.9 If the Vessel shall be libeled, attached, detained, seized or levied upon or
taken into custody under process or under color of any authority, Owner shall
forthwith notify Mortgagee by facsimile, confirmed by letter, and immediately
get it released, and in any event within fifteen (15) days after such libel,
attachment, detention, seizure, levy or taking into custody. If any lien or
encumbrance, other than as permitted by Paragraph 1.6, is claimed against the
Vessel, which would constitute a prior lien to this Mortgage or would adversely
affect the value of Mortgagee’s security, Mortgagee may, in its discretion, pay
and discharge such lien or encumbrance.
1.10 Owner and any charterer shall at all times afford Mortgagee complete
opportunity to inspect the Vessel and cargoes and papers, and to examine Owner’s
and any charterer’s related accounts and records; and shall certify from time to
time, at such intervals as Mortgagee shall determine, that all wages and all
other claims which might give rise to a lien upon the Vessel have been paid
(except as otherwise permitted by Paragraph 1.6).

 

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1.11 Except as otherwise permitted under the Credit Agreement, Owner shall not
(a) sell, mortgage, deliver or lease the Vessel, nor charter the Vessel, nor in
any manner transfer or agree to sell, mortgage, lease, charter, deliver or
otherwise transfer, to any person, any interest or control in the Vessel, except
with the prior written consent of Mortgagee, and then only if (i) to persons,
and for uses, lawful for American vessels and (ii) the insurance required to be
maintained hereby is unaffected or adequately replaced to the satisfaction of
Mortgagee; nor (b) without the prior written consent of Mortgagee, merge or
consolidate with any other person, firm or corporation, or dissolve. Paragraphs
1.6, 1.7 and 1.10 hereof, and this Paragraph 1.11, shall be included in any
charter party with respect to the Vessel.
1.12 From time to time, Owner shall execute and deliver such other and further
instruments and assurance as, in the opinion of Mortgagee’s counsel, may
reasonably be required to subject the Vessel more effectively to the lien of
this Mortgage and as security for the performance of the Secured Obligations and
for operation of the Vessel as provided herein, and to arrange sales as provided
in Paragraph 2.1(c) of Article II.
ARTICLE II.
DEFAULT
2.1 If an “Event of Default” (under and as defined in the Credit Agreement)
shall have occurred and be continuing under the Credit Agreement or any other
Loan Document (as defined in the Credit Agreement), then, Mortgagee may:
(a) Declare the Secured Obligations to be, and they shall be, due and payable;
and/or
(b) Recover judgment for, and collect out of any property of Owner, any amount
due; and/or collect all earned charter hire and freight monies relating to
services performed by the Vessel, if any, Owner assigning to Mortgagee all such
charter hire and freight monies then owing; and/or
(c) Retake the Vessel, with or without legal process, at any time, at any place,
and, without being responsible for loss or damage, hold and in Mortgagee’s or in
Owner’s name lease, charter, operate or otherwise use the Vessel for such time
and on such terms as Mortgagee may deem advisable, being accountable only for
net profits, if any, and with the right to dock the Vessel free of charge at
Owner’s premises or elsewhere at Owner’s expense; and/or sell the Vessel, free
from any claim by Owner of any nature whatsoever, in any manner permitted by
law; to the extent so permitted, such sale may be public or private, without
notice, without having the Vessel present, and Mortgagee may become the
purchaser.
For such purpose Mortgagee and its agents are irrevocably appointed the true and
lawful attorneys of Owner in its name and stead to make all necessary transfers
of the Vessel thus sold.
2.2 In the event the Vessel shall be arrested or detained by any officer of any
court or by any other authority, Owner authorizes Mortgagee, its officers,
representatives and

 

5

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appointees, in the name of Owner or of Mortgagee, to receive or to take
possession, and to defend any action and/or discharge any lien.
2.3 Each and every power or remedy given to Mortgagee shall be cumulative, and
in addition to all powers or remedies now or later existing in admiralty, in
equity, at law or by statute, and may be exercised as often as may be deemed
expedient by Mortgagee. No delay or omission by Mortgagee shall impair any
right, power or remedy, and no waiver of any default shall waive any other
default. In any suit Mortgagee shall be entitled to obtain appointment of a
receiver of the Vessel and its earnings, who shall have full rights and powers
to use and operate the Vessel, and to obtain a decree ordering and directing its
sale and disposition.
2.4 The net proceeds of any judicial or other sale, and any lease, charter,
management, operation or other use of the Vessel by Mortgagee, of any claim for
damages, of any judgment, and any insurance received by Mortgagee (except to the
extent paid to Owner or applied in payment of repairs or otherwise for Owner’s
benefit) shall be applied as follows:

         
 
  FIRST:   To the payment of all Attorney Costs, court costs, and any other
expenses, losses, charges, damages incurred or advances made by Mortgagee or
Lenders in order to protect their rights or caused by Owner’s failure to perform
any of the Secured Obligations or any other obligations hereunder, with interest
on all such amounts at the rate set forth in Section 2.16 of the Credit
Agreement, and to provide adequate indemnity against any liens for which
priority over this Mortgage is claimed;
 
       
 
  SECOND:   To the payment of the Secured Obligations, and any other obligations
of Owner hereunder, together with interest thereon, all in such order of
application as may be required or permitted by the Loan Documents.

Mortgagee shall be entitled to collect any deficiency from Owner. Owner shall be
entitled to any surplus, subject to setoff in favor of Mortgagee or any Lender
for any other indebtedness of Owner under the Loan Documents.
2.5 All advances and expenditures which Mortgagee or any Lender in their
discretion may make for repairs, insurance, payment of liens or other claims,
defense of suits, or for any other related purpose, and all damages sustained by
Mortgagee or any Lender because of defaults, shall be repaid by Owner on demand
with interest at a rate per annum equal to the interest rate then applicable to
Obligations under the Credit Agreement, and until so paid shall be a debt due
from Owner to Mortgagee or such Lender, secured by the lien hereof. Neither
Mortgagee nor any Lender shall be obligated to make any such advances or
expenditures, but if made, the Owner is not relieved of any obligation.
ARTICLE III.
POSSESSION UNTIL EVENT OF DEFAULT
Unless an Event of Default shall have occurred and is continuing, Owner shall be
permitted to retain actual possession and use of the Vessel.

 

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ARTICLE IV.
SUNDRY PROVISIONS
All covenants and agreements of Owner shall bind Owner and its successors and
assigns, and shall inure to the benefit of Mortgagee and Lenders and their
respective successors and assigns. In case any term or provision of this
Mortgage shall be held to be invalid or unenforceable, such invalidity or
unenforceability shall not affect any other term or provision of the Mortgage,
and this Mortgage shall be construed as if such invalid or unenforceable term or
provision was nonexistent.
For purposes of Section 102(c) of Public Law 100-710 (46 U.S.C. § 31321(b)(3)),
the total amount that is or may become secured by this Mortgage (excluding
interest, expenses and fees) is $                    ; and the discharge amount
is the same as the total amount and, although it is not intended that this
Mortgage include any property other than the Vessel, if any determination is
made at any time that for any reason this Mortgage does include any property
other than a “vessel” within the meaning of Section 31322 of Title 46 of the
United States Code, then such property may be separately discharged from the
lien of the Mortgage.
The parties hereto acknowledge that certain exercises of rights and remedies
hereunder may require compliance with applicable Gaming Laws, including the
Louisiana Gaming Control Law, La. R.S. 27:1, et seq., together with the
regulations applicable to Riverboat Gaming, La. Admin. Code Tit. 42, Part XIII.
Notwithstanding any other provisions of this Mortgage to the contrary, nothing
in this Mortgage shall (i) effect any transfer of any ownership interest in
Mortgagor or (ii) effect any transfer, sale, purchase, lease or hypothecation
of, or any borrowing or loaning of money against, or any establishment of any
voting trust agreement or similar agreement with respect to any certificate of
suitability or any owner’s license heretofore or hereinafter issued to any
person, including Mortgagor, all within the meaning of La. R.S. 27:31 and La.
Admin. Code Tit. 42, Pt. XIII, Ch. 25, particularly, and any other applicable
provisions of the Louisiana Gaming Control Law.
If there is a conflict between this Mortgage and the Credit Agreement, the terms
of the Credit Agreement shall control.

 

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IN WITNESS WHEREOF, on the day and year first above written, Owner has caused
this Mortgage to be executed in its name by its properly authorized officer.

                      Owner-Mortgagor:        
 
                         
 
               
 
  By:                          
 
      Name:        
 
         
 
   
 
      Title:        
 
         
 
   

 

 

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ACCEPTED AND AGREED
AS OF THE DATE FIRST
ABOVE WRITTEN:
“Secured Party”
BARCLAYS BANK PLC
as Administrative Agent, and for
and on behalf of the Lenders

         
By:
       
 
 
 
   
Title:
       
 
 
 
   
 
       
Address:
       

 

 

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EXHIBIT H
FORM OF
NOTICE OF BORROWING
                     ___, 20__
Barclays Bank PLC,
as Administrative Agent
200 Park Avenue
New York, New York 10166
Attention: Craig Malloy
Pinnacle Entertainment, Inc.
Ladies and Gentlemen:
Pursuant to that certain Third Amended and Restated Credit Agreement, dated as
of February _____, 2010 (as amended, restated, amended and restated,
supplemented, replaced or otherwise modified from time to time, the “Credit
Agreement”; capitalized terms used but not defined herein having the meanings
given such terms in the Credit Agreement), among Pinnacle Entertainment, Inc., a
Delaware corporation (the “Borrower”), each bank and other financial institution
or entity from time to time party thereto, and Barclays Bank PLC, as
administrative agent (the “Administrative Agent”), the Borrower hereby gives the
Administrative Agent irrevocable notice that the Borrower hereby requests a Loan
or Swing Line Loan under the Credit Agreement, and in that connection sets forth
below the information relating to such Loan or Swing Line Loan:

  1.  
The Borrower hereby requests (Check one box only):

(a). A Loan under Revolving Commitment o
(b). A Swing Line Loan under Revolving Commitment o
(c). A Loan under the Incremental Term Commitment o
(d). A Loan under the Incremental Delayed Draw Term Loan Commitment o

  2.  
The aggregate amount of the proposed Loan is $                    .
    3.  
The Business Day of the proposed Loan is                     
    4.  
Type of the proposed Loan elected (Check one box only):

(a). Base Rate Loan o

 

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(b). Eurodollar Loan                      with an interest period of
                     months.1 o
In connection with the requested Loan or Swing Line Loan, the Borrower hereby
certifies that the following statements are true and correct on the date hereof,
and will be true and correct on the date of the proposed Loan, Swing Line Loan:
(a) Each of the representations and warranties made by any Loan Party in or
pursuant to the Loan Documents is true and correct in all material respects on
and as of the date hereof as if made on and as of the date hereof, except for
representations and warranties expressly stated to relate to a specific earlier
date, in which case such representations and warranties are true and correct as
of such earlier date.
(b) No Default or Event of Default has occurred and is continuing on the date
hereof, or would result from the proposed Loan or Swing Line Loan or the
application of the proceeds thereof.
The Borrower agrees that, if prior to the time of the proposed Loan or Swing
Line Loan any of the foregoing certifications shall cease to be true and
correct, the Borrower shall forthwith notify the Administrative Agent thereof in
writing (any such notice, a “Non-Compliance Notice”). Except to the extent, if
any, that prior to the time of the proposed Loan or Swing Line Loan the Borrower
shall deliver a Non-Compliance Notice to the Administrative Agent, each of the
foregoing certifications shall be deemed to be made additionally on the date of
the proposed Loan or Swing Line Loan as if made on such date.
 

      1  
Specify 1, 2, 3 or 6 months Interest Period (any other period is subject to
certain consent requirements set forth in Section 10.1 of the Credit Agreement).

 

2

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            Very truly yours,

PINNACLE ENTERTAINMENT, INC.,
a Delaware corporation
      By:           Name:           Title:      

 

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EXHIBIT I-1
FORM OF INCREMENTAL TERM NOTE
                     20__
THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW. TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.
$                                        
                     __, 20__
FOR VALUE RECEIVED, the undersigned, PINNACLE ENTERTAINMENT, INC., a Delaware
corporation (the “Borrower”), hereby promises to pay to
                                         or its registered assign at the Payment
Office specified in the Credit Agreement (as hereinafter defined) in lawful
money of the United States and in immediately available funds, the principal
amount of                      dollars ($                    ) (the “Loan”),
together with interest thereon, in accordance with the terms set forth in the
Credit Agreement. Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement.
The holder of this Note is authorized to endorse on the schedules annexed hereto
and made a part hereof or on a continuation thereof which shall be attached
hereto and made a part hereof, the date, type and amount of the Loan and the
date and amount of each payment or prepayment of principal with respect thereto,
each conversion of all or a portion thereof to another Type, each continuation
of all or a portion thereof as the same Type and, in the case of Eurodollar
Loans, the length of each Interest Period with respect thereto. Each such
endorsement absent manifest error shall constitute prima facie evidence of the
accuracy of the information so endorsed. The failure to make any such
endorsement or any error in any such endorsement shall not affect the
obligations of the Borrower in respect of the Loan.
This Note (a) is one of the Incremental Term Notes referred to in the Third
Amended and Restated Credit Agreement dated as of February _____, 2010 (as the
same may be further amended, restated, amended and restated, supplemented,
replaced or otherwise modified from time to time, the “Credit Agreement”), by
and among the Borrower, the several banks and other financial institutions or
entities from time to time parties thereto, BANC OF AMERICA SECURITIES LLC AND
JPMORGAN SECURITIES, INC., as Joint Lead Arrangers and Joint Book Runners, and
BARCLAYS BANK PLC, as administrative agent, (b) is subject to the provisions of
the Credit Agreement, and (c) is subject to optional and mandatory prepayment in
whole or in part as provided in the Credit Agreement. This Note is secured and
guaranteed as provided in the Loan Documents. Reference is hereby made to the
Loan Documents for a description of the properties and assets in which a
security interest has been granted, the nature and extent of the security and
the guarantees, the terms and conditions upon which the security interests and
each guarantee were granted and the rights of the holder of this Note in respect
thereof.

 

 

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Upon the occurrence and during the continuance of any Event of Default, all
principal and all accrued interest then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE CREDIT
AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE
WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE CREDIT
AGREEMENT.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

            PINNACLE ENTERTAINMENT, INC.
a Delaware corporation
      By:           Name:           Title:      

 

 

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Schedule A
to Incremental Term Note
LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS

                                                              Amount            
Amount of Base Rate                   Amount of Base Rate     Converted to    
Amount of Principal of     Loans Converted to     Unpaid Principal Balance    
Notation   Date   Loans     Base Rate Loans     Base Rate Loans Repaid    
Eurodollar Loans     of Base Rate Loans     Made By  
 
                                               

 

 

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Schedule B
to Incremental Term Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS

                                                                      Amount
Converted     Interest Period and     Amount of Principal     Amount of
Eurodollar     Unpaid Principal             Amount of     to Eurodollar    
Eurodollar Rate with     of Eurodollar Loans     Loans Converted to     Balance
of     Notation   Date   Eurodollar Loans     Loans     Respect Thereto    
Repaid     Base Rate Loans     Eurodollar Loans     Made By  
 
                                                       

 

 

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EXHIBIT I-2
FORM OF INCREMENTAL DELAYED DRAW TERM NOTE
                     20__
THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW. TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.

      $                                           .

                     , 20__
FOR VALUE RECEIVED, the undersigned, PINNACLE ENTERTAINMENT, INC., a Delaware
corporation (the “Borrower”), hereby promises to pay to
                                         or its registered assign at the Payment
Office specified in the Credit Agreement (as hereinafter defined) in lawful
money of the United States and in immediately available funds, the principal
amount of                      dollars ($                    ) (the “Loan”),
together with interest thereon, in accordance with the terms set forth in the
Credit Agreement. Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement.
The holder of this Note is authorized to endorse on the schedules annexed hereto
and made a part hereof or on a continuation thereof which shall be attached
hereto and made a part hereof, the date, type and amount of the Loan and the
date and amount of each payment or prepayment of principal with respect thereto,
each conversion of all or a portion thereof to another Type, each continuation
of all or a portion thereof as the same Type and, in the case of Eurodollar
Loans, the length of each Interest Period with respect thereto. Each such
endorsement absent manifest error shall constitute prima facie evidence of the
accuracy of the information so endorsed. The failure to make any such
endorsement or any error in any such endorsement shall not affect the
obligations of the Borrower in respect of the Loan.
This Note (a) is one of the Incremental Delayed Draw Term Notes referred to in
the Third Amended and Restated Credit Agreement dated as of February _____, 2010
(as the same may be further amended, restated, amended and restated,
supplemented, replaced or otherwise modified from time to time, the “Credit
Agreement”), by and among the Borrower, the several banks and other financial
institutions or entities from time to time parties thereto, BANC OF AMERICA
SECURITIES LLC AND JPMORGAN SECURITIES, INC., as Joint Lead Arrangers and Joint
Book Runners, and BARCLAYS BANK PLC, as administrative agent, (b) is subject to
the provisions of the Credit Agreement, and (c) is subject to optional and
mandatory prepayment in whole or in part as provided in the Credit Agreement.
This Note is secured and guaranteed as provided in the Loan Documents. Reference
is hereby made to the Loan Documents for a description of the properties and
assets in which a security interest has been granted, the nature and extent of
the security and the guarantees, the terms and conditions upon which the
security interests and each guarantee were granted and the rights of the holder
of this Note in respect thereof.

 

 

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

 

Upon the occurrence and during the continuance of any Event of Default, all
principal and all accrued interest then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE CREDIT
AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE
WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE CREDIT
AGREEMENT.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

            PINNACLE ENTERTAINMENT, INC.
a Delaware corporation
      By:           Name:           Title:      

 

 

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Schedule A
to Incremental Delayed Draw Term Note
LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS

                                                              Amount            
Amount of Base Rate                   Amount of Base Rate     Converted to    
Amount of Principal of     Loans Converted to     Unpaid Principal Balance    
Notation    Date   Loans     Base Rate Loans     Base Rate Loans Repaid    
Eurodollar Loans     of Base Rate Loans     Made By  
 
                                               

 

 

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Schedule B
to Incremental Delayed Draw Term Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS

                                                                      Amount
Converted     Interest Period and     Amount of Principal     Amount of
Eurodollar     Unpaid Principal             Amount of     to Eurodollar    
Eurodollar Rate with     of Eurodollar Loans     Loans Converted to     Balance
of     Notation   Date   Eurodollar Loans     Loans     Respect Thereto    
Repaid     Base Rate Loans     Eurodollar Loans     Made By  
 
                                                       

 

 

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EXHIBIT I-3
FORM OF REVOLVING CREDIT NOTE
                    , 2010
THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW. TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.
$                    
                     __, 20__
FOR VALUE RECEIVED, the undersigned, PINNACLE ENTERTAINMENT, INC., a Delaware
corporation (the “Borrower”), hereby promises to pay to the several banks and
other financial institutions or entities from time to time parties to the Credit
Agreement ( as hereinafter defined) (the “Lenders”) or their registered assigns
at the Payment Office specified in the Credit Agreement in lawful money of the
United States and in immediately available funds, on or before the Revolving
Credit Termination Date the principal amount of (a)                      dollars
($                    ), or, if less, (b) the aggregate unpaid principal amount
of all Revolving Credit Loans made by the Lender to the Borrower, together with
interest thereon, pursuant to the terms of the Credit Agreement. Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.
The holder of this Note is authorized to endorse on the schedules annexed hereto
and made a part hereof or on a continuation thereof which shall be attached
hereto and made a part hereof, the date, type and amount of each Revolving
Credit Loan made pursuant to the Credit Agreement and the date and amount of
each payment or prepayment of principal thereof, each continuation thereof, each
conversion of all or a portion thereof to another Type and, in the case of
Eurodollar Loans, the length of each Interest Period with respect thereto. Each
such endorsement absent manifest error shall constitute prima facie evidence of
the accuracy of the information so endorsed. The failure to make any such
endorsement or any error in any such endorsement shall not affect the
obligations of the Borrower in respect of any Revolving Credit Loan.
This Note (a) is one of the Revolving Credit Notes referred to in the Third
Amended and Restated Credit Agreement dated as of February _____, 2010 (as the
same may be amended, restated, amended and restated, supplemented, replaced or
otherwise modified from time to time, the “Credit Agreement”), among the
Borrower, the Lenders, BANC OF AMERICA SECURITIES LLC and JPMORGAN SECURITIES,
INC., as joint lead arrangers and joint book runners, and BARCLAYS BANK PLC, as
administrative agent, (b) is subject to the provisions of the Credit Agreement,
and (c) is subject to optional and mandatory prepayment in whole or in part as
provided in the Credit Agreement. This Note is secured and guaranteed as
provided in the Loan Documents. Reference is hereby made to the Loan Documents
for a description of the properties and assets in which a security interest has
been granted, the nature and extent of the

 

 

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

 

security and the guarantees, the terms and conditions upon which the security
interests and each guarantee were granted and the rights of the holder of this
Note in respect thereof.
Upon the occurrence and during the continuance of any Event of Default, all
principal and all accrued interest then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE CREDIT
AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE
WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE CREDIT
AGREEMENT.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

            PINNACLE ENTERTAINMENT, INC.
a Delaware corporation
      By:           Name:           Title:      

 

 

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Schedule A
to Revolving Credit Note
LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS

                                                              Amount            
Amount of Base Rate                   Amount of Base Rate     Converted to    
Amount of Principal of     Loans Converted to     Unpaid Principal Balance    
Notation   Date   Loans     Base Rate Loans     Base Rate Loans Repaid    
Eurodollar Loans     of Base Rate Loans     Made By  
 
                                               

 

 

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Schedule B
to Revolving Credit Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS

                                                                      Amount
Converted     Interest Period and     Amount of Principal     Amount of
Eurodollar     Unpaid Principal             Amount of     to Eurodollar    
Eurodollar Rate with     of Eurodollar Loans     Loans Converted to     Balance
of     Notation   Date   Eurodollar Loans     Loans     Respect Thereto    
Repaid     Base Rate Loans     Eurodollar Loans     Made By  
 
                                                       

 

 

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EXHIBIT I-4
FORM OF SWING LINE NOTE
                     20     
THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW. TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.
$                    
                          , 20     
FOR VALUE RECEIVED, the undersigned, PINNACLE ENTERTAINMENT, INC., a Delaware
corporation (the “Borrower”), hereby promises to pay                      (the
“Swing Line Lender”) or its registered assigns at the payment office specified
in the Credit Agreement (as herein defined) in lawful money of the United States
and in immediately available funds, on or before the Revolving Credit
Termination Date the principal amount of (a)                      dollars
($                    ), or, if less, (b) the aggregate unpaid principal amount
of all Swing Line Loans made by the Swing Line Lender to the Borrower, together
with interest thereon, pursuant to the terms of the Credit Agreement. Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.
The holder of this Note is authorized to endorse on the schedules annexed hereto
and made a part hereto or on a continuation thereof which shall be attached
hereto and made a part hereof, the date and amount of each Swing Line Loan made
pursuant to the Credit Agreement and the date and amount of each payment or
prepayment of principal thereof. Each such endorsement absent manifest error
shall constitute prima facie evidence of the accuracy of the information so
endorsed. The failure to make any such endorsement or any error in any such
endorsement shall not affect the obligations of the Borrower in respect of any
Swing Line Loan.
This Note (a) is one of the Swing Line Notes referred to in the Third Amended
and Restated Credit Agreement dated as of February _____, 2010 (as the same may
be amended, restated, amended and restated, supplemented, replaced or otherwise
modified from time to time, the “Credit Agreement”), among Borrower, the
Lenders, BANC OF AMERICA SECURITIES LLC AND JPMORGAN SECURITIES, INC., as Joint
Lead Arrangers and Joint Book Runners, and BARCLAYS BANK PLC, as administrative
agent, (b) is subject to the provisions of the Credit Agreement, and (c) is
subject to optional and mandatory prepayment in whole or in part as provided in
the Credit Agreement. This Note is secured and guaranteed as provided in the
Loan Documents. Reference is hereby made to the Loan Documents for a description
of the properties and assets in which a security interest has been granted, the
nature and extent of the security and the guarantees, the terms and conditions
upon which the security interests and each guarantee were granted and the rights
of the holder of this Note in respect thereof.

 

 

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

 

Upon the occurrence and during the continuance of any Event of Default, all
principal and all accrued interest then remaining unpaid on this note shall
become, or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether maker,
principal, surety, guarantor, endorser or otherwise, hereby waive presentment,
demand, protest and all other notices of any kind.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE CREDIT
AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE
WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE CREDIT
AGREEMENT.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

                      PINNACLE ENTERTAINMENT, INC.,         a Delaware
corporation    
 
               
 
  BY:                          
 
      Name:        
 
               
 
      Title:        
 
               

 

 

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

 

Schedule A
to Swing Line Note
LOANS AND REPAYMENTS OF SWING LINE LOANS

                                          Amount of   Amount of Principal of
Swing Line   Unpaid Principal Balance of Swing     Date   Swing Line Loans  
Loans Repaid   Line Loans   Notation Made By

 

 

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EXHIBIT J
FORM OF EXEMPTION CERTIFICATE
                     20          
Reference is made to the Third Amended and Restated Credit Agreement, dated as
of February           , 2010 (as the same may be further amended, restated,
amended and restated, supplemented, replaced or otherwise modified from time to
time, the “Credit Agreement”) among PINNACLE ENTERTAINMENT, INC., a Delaware
corporation (the “Borrower”), the several banks and other financial institutions
or entities from time to time parties to the Credit Agreement, BANC OF AMERICA
SECURITIES LLC AND JPMORGAN SECURITIES, INC., as Joint Lead Arrangers and Joint
Book Runners, and BARCLAYS BANK PLC, as administrative agent. Capitalized terms
used herein that are not defined herein shall have the meanings ascribed to them
in the Credit Agreement.                                          (the “Non-U.S.
Lender”) is providing this certificate pursuant to the Credit Agreement. The
Non-U.S. Lender hereby represents and warrants that:
1. The Non-U.S. Lender is the sole record and beneficial owner of the Loans or
the obligations evidenced by Note(s) in respect of which it is providing this
certificate.
2. The Non-U.S. Lender is not a “bank” for purposes of Section 881(c)(3)(A) of
the Internal Revenue Code of 1986, as amended (the “Code”). In this regard, the
Non-U.S. Lender further represents and warrants that:
(a) the Non-U.S. Lender is not subject to regulatory or other legal requirements
as a bank in any jurisdiction; and
(b) the Non-U.S. Lender has not been treated as a bank for purposes of any tax,
securities law or other filing or submission made to any Governmental Authority,
any application made to a rating agency or qualification for any exemption from
tax, securities law or other legal requirements;
3. The Non-U.S. Lender is not a 10-percent shareholder of the Borrower within
the meaning of Section 881(c)(3)(B) of the Code; and
4. The Non-U.S. Lender is not a controlled foreign corporation receiving
interest from a related person within the meaning of Section 881(c)(3)(C) of the
Code.
IN WITNESS WHEREOF, the undersigned has duly executed this certificate.

                      [NAME OF NON-U.S. LENDER]    
 
               
 
  By:                          
 
      Name:        
 
               
 
      Title:        
 
               

Date:                                         

 

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EXHIBIT K
FORM OF CLOSING CERTIFICATE
Pursuant to Section 5.1(k) of the Third Amended and Restated Credit Agreement
dated as of February _____, 2010 (the “Credit Agreement”) (capitalized terms not
otherwise defined herein are used herein as so defined in the Credit Agreement),
among PINNACLE ENTERTAINMENT, INC., a Delaware corporation (“Borrower”), the
several banks and other financial institutions or entities parties thereto (the
“Lenders”), BANC OF AMERICA SECURITIES LLC and JPMORGAN SECURITIES, INC., as
joint lead arrangers and joint book runners, and BARCLAYS BANK PLC, as
administrative agent (the “Administrative Agent”), the undersigned, Stephen H.
Capp and John A. Godfrey, hereby certify as follows this  _____  day of
February, 2010:
1. That they are, respectively, either the chief financial officer or the
treasurer of each of the entities listed below (individually, a “Company” and
collectively, the “Companies”) (or, in the case of a limited liability company
or a partnership, the manager, the chief financial officer or treasurer of the
member and/or manager and/or managing member or partner of such limited
liability company or partnership, respectively).
2. The representations and warranties of each of the Loan Parties contained in
the Credit Agreement and the Loan Documents to which it is a party are true and
correct in all material respects on and as of the date hereof with the same
effect as if made on the date hereof.
3. No Default or Event of Default has occurred and is continuing as of the date
hereof or after giving effect to the Loans to be made and/or Letters of Credit
to be issued on the date hereof.
4. There are no liquidation or dissolution proceedings pending or to my
knowledge threatened against the Company, nor has any other event occurred
adversely affecting or threatening the continued corporate existence of the
Company.
5. The execution, delivery and performance of each Loan Document to which each
Company is a party and, in the case of Borrower, to borrow under the Credit
Agreement, was duly authorized by resolutions duly adopted by the appropriate
governing body of the applicable Company (the “Resolutions”), a true, correct
and complete copy of which is attached hereto as Exhibit A and incorporated
herein by this reference, and the Resolutions remain in full force and effect as
of the date hereof and are the only corporate proceedings of the Companies now
in force relating to or affecting the matters referred to therein.
6. Attached hereto as Exhibit B are true, correct and complete copies of all the
articles (or certificates) of incorporation (or, in the case of a limited
liability company or a partnership, the certificates of formation or articles of
organization) of each of the Companies.
7. Attached hereto as Exhibit C are true, correct and complete copies of all the
bylaws (or, in the case of a limited liability company or a partnership, the
operating

 

 

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

 

agreement or partnership agreement) of the Companies, except to the extent there
have been no changes to any such bylaws, operating agreement or partnership
agreement since December 14, 2005.
8. Attached hereto as Exhibit D are Certificates of Good Standing or
Certificates of Existence with respect to each Company from the issuing
governmental agency of each Company’s respective jurisdiction of formation.
9. Attached hereto as Exhibit E are Certificates of Good Standing as foreign
entities from the issuing governmental agency of each jurisdiction where each
Company’s ownership, lease or operation of Property or the conduct of its
business requires such qualification, except to the extent that the failure to
be so qualified or be in good standing could not reasonably be expected to have
a Material Adverse Effect.
10. Pursuant to the Resolutions, and the undersigned, or in our absence any
other appropriate officer of the Companies, have been designated to execute the
Loan Documents referred to in the Resolutions to which each Company is a party.

 

 

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

 

This certificate is being delivered to the Administrative Agent pursuant to
Section 5.1(k) of the Credit Agreement, and the Administrative Agent and the
Lenders are authorized to rely on this Certificate in connection with the Credit
Agreement and the transactions contemplated thereby. In addition, each legal
counsel rendering an Opinion of Counsel is authorized to rely on this
Certificate in connection with the Credit Agreement and the transactions
contemplated thereby.

            Pinnacle Entertainment, Inc.,
a Delaware corporation

BILOXI CASINO CORP.,
a Mississippi corporation

Casino Magic Corp.,
a Minnesota corporation

Casino One Corporation,
a Mississippi corporation

PNK (BOSSIER CITY), INC.,
a Louisiana corporation

St. Louis Casino Corp.,
a Missouri corporation

President Riverboat Casino-Missouri, Inc.,
a Missouri corporation
      By:           Stephen H. Capp        Chief Financial Officer or Treasurer 
 

 

 

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                          Belterra Resort Indiana, LLC,
a Nevada limited liability company    
 
                        By:   Pinnacle Entertainment, Inc., its Sole Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        Boomtown, LLC,
a Delaware limited liability company    
 
                        By:   Pinnacle Entertainment, Inc., its Sole Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        Louisiana-I Gaming,
a Louisiana Partnership in Commendam    
 
                        By:   Boomtown, LLC,
its General Partner    
 
                            By:   Pinnacle Entertainment, Inc., its Sole Member
   
 
                   
 
          By:        
 
             
 
Stephen H. Capp    
 
              Chief Financial Officer    
 
                        OGLE HAUS, LLC,
an Indiana limited liability company    
 
                        By:   Belterra Resort Indiana, LLC, its Sole Member    
 
                            By:   Pinnacle Entertainment, Inc., its Sole Member
   
 
                   
 
          By:        
 
             
 
Stephen H. Capp,    
 
              Chief Financial Officer    
 
                        PNK (LAKE CHARLES), L.L.C.,
a Louisiana limited liability company    

 

 

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

 

                          By:   Pinnacle Entertainment, Inc., its Sole Member
and Manager    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        PNK (Reno), LLC,
a Nevada limited liability company    
 
                        By:   Pinnacle Entertainment, Inc.,             its Sole
Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        PNK (ES), LLC,
a Delaware limited liability company    
 
                        By:   Pinnacle Entertainment, Inc.,             its Sole
Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        PNK (STLH), LLC,
a Delaware limited liability company    
 
                        By:   Pinnacle Entertainment, Inc.,             its Sole
Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    

 

 

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

 

                          PNK (ST. LOUIS RE), LLC,
a Delaware limited liability company    
 
                        By:   Pinnacle Entertainment, Inc.,             its Sole
Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        PNK (CHILE 1), LLC,
a Delaware limited liability company    
 
                        By:   Pinnacle Entertainment, Inc.,             its Sole
Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        PNK (CHILE 2), LLC,
a Delaware limited liability company    
 
                        By:   Pinnacle Entertainment, Inc.,             its Sole
Member    
 
                   
 
      By:                                           Stephen H. Capp            
    Chief Financial Officer    
 
                        PNK (BATON ROUGE) PARTNERSHIP,
a Louisiana partnership    
 
                        By:   PNK Development 8, LLC,             its Managing
Partner    
 
                            By:   Pinnacle Entertainment, Inc.,                
its sole member    
 
                   
 
          By:        
 
             
 
Stephen H. Capp    
 
              Chief Financial Officer    

 

 

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            PNK Development 7, LLC,
a Delaware limited liability company
      By:  Pinnacle Entertainment, Inc.,         its sole member   

            By:           Stephen H. Capp        Chief Financial Officer   

            PNK Development 8, LLC,
a Delaware limited liability company
      By:  Pinnacle Entertainment, Inc.,         its sole member   

            By:           Stephen H. Capp        Chief Financial Officer   

            PNK Development 9, LLC,
a Delaware limited liability company
      By:  Pinnacle Entertainment, Inc.,         its sole member   

            By:           Stephen H. Capp        Chief Financial Officer   

            PNK (SCB), L.L.C.,
a Louisiana limited liability company
      By:   PNK Development 7, LLC,         its sole member   

            By:  Pinnacle Entertainment, Inc.,         its sole member   

            By:           Stephen H. Capp        Chief Financial Officer   

 

 

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            YANKTON INVESTMENTS, LLC,
a Nevada limited liability company
      By:           Name:           Title:      

 

 

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          ACCEPTED AND AGREED TO:    
 
        BARCLAYS BANK PLC,
as Administrative Agent    
 
       
By:  
     
 
Name:        
 
Title:      

 

 

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EXHIBIT L
FORM OF IN-BALANCE TEST CERTIFICATE
This In-Balance Test Certificate (“Certificate”) is delivered to Barclays Bank
PLC, as Administrative Agent pursuant to Section 6.13(b) of the Third Amended
and Restated Credit Agreement, dated as of February _____, 2010 (as amended,
restated, amended and restated, supplemented, replaced or modified from time to
time, the “Credit Agreement”), among PINNACLE ENTERTAINMENT, INC., a Delaware
corporation (the “Borrower”), the several banks and other financial institutions
or entities from time to time parties thereto, BANC OF AMERICA SECURITIES LLC
and JPMORGAN SECURITIES, INC., as joint lead arrangers and joint book runners
and BARCLAYS BANK PLC, as administrative agent. Capitalized terms used in this
Certificate and all Attachments hereto but not defined herein or therein shall
have the meanings given to such terms in the Credit Agreement.

  1.  
I am a duly elected, qualified and acting _____ officer of the Borrower.
    2.  
I have reviewed and am familiar with the contents of this Certificate.
    3.  
Attached hereto as Attachment 1.I are the In-Balance Projections prepared for
the In-Balance Test for the following Project:

         
 
       
 
 
 
   
 
       
 
 
 
   
 
       
 
 
 
   

  4.  
The In-Balance Projections are based on reasonable estimates, information and
assumptions and I have no reason to believe that such In-Balance Projections are
incorrect or misleading in any material respect.
    5.  
Attached hereto as Attachment 1.II are the calculations of the Project Sources
and the Project Uses for the Project as of the date set forth thereto showing
compliance with the In-Balance Test.

IN WITNESS WHEREOF, I execute this Certificate this                      day of
                    , 20___.

                 
 
                    PINNACLE ENTERTAINMENT, INC.,
a Delaware corporation    
 
               
 
  By:                          
 
      Name:        
 
      Title:  
 
   
 
         
 
   

 

 

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ATTACHMENT 1
The information described herein is as of                      _____, 20_____
(the “Certification Date”), and pertains to the period from                     
_____, 20_____ to                      _____, 20_____ 1.

I.  
IN-BALANCE PROJECTIONS

  A.  
In-Balance Projections means, with respect to any In-Balance Test, good faith
projections of the Consolidated EBITDA of the Borrower and its Restricted
Subsidiaries for the period from the first day of the calendar month in which
In-Balance Test is being made through the end of the Project Period for the
applicable Project.

                                          Projection for                    
Quarter     Projection   Projection for   Projection for       Ending at the    
for Quarter   Quarter   Quarter   [add more   end of the     Ending   Ending  
Ending   columns as   Project     [___]   [___]   [___] appropriate] Period
 
                   
Consolidated Net Income of the Borrower and its Restricted Subsidiaries
                   
 
                   
Plus:
                   
 
                   
income tax expense
                   
 
                   
Consolidated Interest Expense of the Borrower and its Restricted Subsidiaries,
amortization or writeoff of debt discount and debt issuance costs and
commissions, discounts and other fees and charges associated with Indebtedness
                   
 
                   
depreciation and amortization expense
                   

 

      1  
Should be made through the end of the Project Period for the applicable Project.
The Project Period for any Project is the period of time commencing on the date
of the determination of the In-Balance Test with respect to such Project and
ending on the date six full months after the scheduled opening date of the
Project.

 

 

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                                          Projection for                    
Quarter     Projection   Projection for   Projection for       Ending at the    
for Quarter   Quarter   Quarter   [add more   end of the     Ending   Ending  
Ending   columns as   Project     [___]   [___]   [___] appropriate] Period
 
                   
amortization and write-off of intangibles (including, but not limited to,
goodwill) and organization costs
                   
 
                   
any extraordinary, unusual or non-recurring expenses or losses (including,
whether or not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, losses on sales of assets outside of
the ordinary course of business)
                   
 
                   
pre-opening and related promotional expenses incurred in connection with any
Project
                   
 
                   
any other non-cash charges
                   
 
                   
any amount expended after January 1, 2010 towards the development of businesses
not prohibited by Section 7.l4 of the Credit Agreement, in an amount not to
exceed $2,500,000 in any fiscal year
                   
 
                   
minus:
                   
 
                   
the sum of:
                   
 
                   
interest income (except to the extent deducted in determining Consolidated
Interest Expense)
                   
 
                   
any extraordinary, unusual or non-recurring income or gains (including, whether
or not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, gains on
                   

 

 

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                                          Projection for                    
Quarter     Projection   Projection for   Projection for       Ending at the    
for Quarter   Quarter   Quarter   [add more   end of the     Ending   Ending  
Ending   columns as   Project     [___]   [___]   [___] appropriate] Period
 
                   
sales of assets outside of the ordinary course of business, but not including
business interruption insurance proceeds)
                   
 
                   
any other non-cash income
                   
 
                   
TOTAL CONSOLIDATED EBITDA
                   

         
II. IN-BALANCE TEST
       
A. Project Sources as of the Certification Date
       
1. Total unrestricted Cash and Cash Equivalents of the Borrower and its
Restricted Subsidiaries minus the Minimum Cash Requirement as of such date of
determination:
  $                       
2. Amount of the Consolidated EBITDA of the Borrower and its Restricted
Subsidiaries set forth in the In-Balance Projections for the In-Balance Test
with respect to such Project:
  $                       
3. Unutilized Commitments under the Revolving Credit Facility, any Incremental
Revolving Facility or any Incremental Delayed Draw Term Facility, in each case,
as of such date of determination:
  $                       
4. Unutilized committed lease financing or other form of committed financing of
the Borrower and its Restricted Subsidiaries as of such date of determination
for such Project (and for all other Unfinished Projects):
  $                       

 

 

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5. the Net Disposition Proceeds to be received by the Borrower and its
Restricted Subsidiaries from Dispositions which are subject to contractual
commitments as of such date of determination, so long as (i) such contractual
commitments are not subject to any conditions other than the passage of time and
the obtaining of any applicable Gaming Board approvals, (ii) such Net
Disposition Proceeds are reasonably expected to be received during the Project
Period, (iii) the Borrower has designated or re-designated such Net Disposition
Proceeds for use for such Project or any other Unfinished Project, plus other
sources of funds that other parties are contractually committed (such as
contractually committed proceeds of insurance payments and legal settlements and
awards) to make cash payments to the Borrower and its Restricted Subsidiaries
within the Project Period, so long as the Borrower has designated or
re-designated such cash payments for use for such Project or any other
Unfinished Project:2
  $                       
6. Aggregate amount of Project Sources (aggregate amount of Project Sources
described in A1 through A5):
  $                       
 
       
B. Project Uses as of the Certification Date
       
1. Forecasted cash interest costs of the Borrower and its Restricted
Subsidiaries from such date of determination through the end of the Project
Period for such Project:
  $                       
2. Projected Maintenance Capital Expenditures and all other Capital Expenditures
of the Borrower and its Restricted Subsidiaries (other than Capital Expenditures
for such Project and all other Unfinished Projects) through the Project Period
for such Project:
  $                       
3. All remaining Expenses for such Project and all other Unfinished Projects
(including any pre-opening costs) through the Project Period for such Project:
  $                       
4. Forecasted cash income tax payments of the Borrower and its Restricted
Subsidiaries through the Project Period for such Project:
  $                       
5. Investments with respect to which the Borrower and/or any of its Restricted
Subsidiaries has entered into a written enforceable agreement or contract to
make at any time during the Project Period for such Project:
  $                       
6. Aggregate amount of Project Uses (aggregate amount of Project Uses described
in B1 through B5):
  $                       

 

      2  
Amount shall not exceed $25,000,000 in the aggregate for any Project.

 

 

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C. Aggregate amount of Project Sources (amount in A6) minus Aggregate amount of
Project Uses (amount in B6):3
  $                       
 
       
                     Project is In-Balance (if amount in C is > 0)
       
                     Project is not In-Balance (if amount in C is < or equal to
0)
       

 

      3  
The applicable Project shall satisfy the In-Balance Test if, as of such date,
the Project Sources exceed the Project Uses for such Project (and for all other
Unfinished Projects) for the Project Period for such Project.

 

 

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EXHIBIT O
FORM OF ASSIGNMENT AND ACCEPTANCE
_____________, 20____
Reference is made to the Third Amended and Restated Credit Agreement, dated as
of February  _____  , 2010 (as amended and as the same may be further amended,
restated, amended and restated, supplemented, replaced or otherwise modified
from time to time, the “Credit Agreement”), among PINNACLE ENTERTAINMENT, INC.,
a Delaware corporation (the “Borrower”), the several banks and other financial
institutions or entities from time to time parties to the Credit Agreement, BANC
OF AMERICA SECURITIES LLC AND JPMORGAN SECURITIES, INC., as Joint Lead Arrangers
and Joint Book Runners, and BARCLAYS BANK PLC as administrative agent.
Capitalized terms used and not defined herein shall have the meaning set forth
in the Credit Agreement.
The Assignor identified on Schedule 1 hereto (the “Assignor”) and the Assignee
identified on Schedule 1 hereto (the “Assignee”) agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee without
recourse to the Assignor, and the Assignee hereby irrevocably purchases and
assumes from the Assignor without recourse to the Assignor, as of the Effective
Date (as defined below in paragraph 4), the interest described on Schedule 1
hereto (the “Assigned Interest”) in and to the Assignor’s rights and obligations
under the Credit Agreement with respect to those credit facilities contained in
the Credit Agreement as are set forth on Schedule 1 hereto (individually, an
“Assigned Facility” collectively, the “Assigned Facilities”), in a principal
amount for each Assigned Facility as set forth on Schedule 1 hereto.
2. The Assignor: (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement, any other Loan Document or any other instrument or
document furnished pursuant thereto, other than that the Assignor has not
created any adverse claim upon the interest being assigned by it hereunder and
that such interest is free and clear of any such adverse claim; (b) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower, any of its Subsidiaries or any other
obligor or the performance or observance by the Borrower, any of its
Subsidiaries or any other obligor of any of their respective obligations under
the Credit Agreement or any other Loan Document or any other instrument or
document furnished pursuant hereto or thereto; and (c) attaches any Notes held
by it evidencing the Assigned Facilities and (i) requests that the
Administrative Agent, upon request by the Assignee, exchange the attached Notes
for a new Note or Notes payable to the Assignee and (ii) if the Assignor has
retained any interest in the Assigned Facility, requests that the Administrative
Agent exchange the attached Notes for a new Note or Notes payable to the
Assignor, in each case in amounts which reflect the assignment being made hereby
(and after giving effect to any other assignments which have become effective on
the Effective Date).
3. The Assignee (a) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance; (b) confirms that it has received a
copy of the Credit Agreement, together with copies of the financial statements
delivered pursuant to Section 4.1 and Section 6.1 thereof and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (c) agrees
that it will, independently and without reliance upon the Assignor, the Agents,
the Arrangers or any other Lender and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Credit Agreement, the other Loan
Documents or any other

 

 

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

 

instrument or document furnished pursuant hereto or thereto; (d) appoints and
authorizes the Agents to take such action as agent on its behalf and to exercise
such powers and discretion under the Credit Agreement, the other Loan Documents
or any other instrument or document furnished pursuant hereto or thereto as are
delegated to the Agents by the terms thereof together with such powers as are
incidental thereto; and (e) agrees that it will be bound by the provisions of
the Credit Agreement and will perform in accordance with its terms all the
obligations which by the terms of the Credit Agreement are required to be
performed by it as a Lender, including, without limitation, if it is organized
under the laws of a jurisdiction outside of the United States, its obligation
pursuant to Section 2.21 of the Credit Agreement.
4. The effective date of this Assignment and Acceptance shall be the “Effective
Date of Assignment” set forth in Schedule 1 hereto (the “Effective Date”).
Following the execution of this Assignment and Acceptance, it will be delivered
to the Administrative Agent for acceptance by it and recording by the
Administrative Agent pursuant to the Credit Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of such
acceptance and recording by the Administrative Agent).
5. Upon such acceptance and recording, from and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned Interest
(including payments of principal, interest, fees and other amounts) to the
Assignee whether such amounts have accrued prior to the Effective Date or accrue
subsequent to the Effective Date. The Assignor and the Assignee shall make all
appropriate adjustments in payments by the Administrative Agent for periods
prior to the Effective Date or with respect to the making of this assignment
directly between themselves.
6. From and after the Effective Date, (a) the Assignee shall be a party to the
Credit Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Lender thereunder and under the other Loan
Documents and shall be bound by the provisions thereof and (b) the Assignor
shall, to the extent provided in this Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Credit Agreement.
7. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.
[Signature page to follow]

 

 

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Schedule 1
to Assignment and Acceptance
Name of Assignor: __________________________
Name of Assignee: __________________________
Effective Date of Assignment: _________________

                  Commitment Percentage Credit Facility Assigned   Principal
Amount Assigned   Assigned1          
 
  $ _____________________     ________ . ________ %

[Name of Assignee]
By: _________________________
      Title: _____________________
[Name of Assignor]
By: _________________________
      Title: _____________________

      1  
Calculate the Commitment Percentage that is assigned to at least 15 decimal
places and show as a percentage of the aggregate commitments of all Lenders.

 

 

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Consented To:
PINNACLE ENTERTAINMENT, INC.,
a Delaware corporation2
By: _________________________
      Title: _____________________
BARCLAYS BANK PLC, as Administrative Agent
By: _________________________
      Title: _____________________
___________________, as Issuing Lender
By: _________________________
      Title: _____________________
___________________, as Swing Line Lender
By: _________________________
      Title: _____________________

      2  
The consents of the Borrower, the Administrative Agent, the Issuing Lender and
the Swing Line Lender may not be required. Typically, the Credit Agreement
provides that the consent of the Borrower, the Administrative Agent, the Issuing
Lender and the Swing Line Lender is required unless (i) the assignee already is
a Lender under the Credit Agreement and (ii) in the case of the Issuing Lender
and the Swing Lender, Revolving Credit Commitments are not being assigned. Check
Section 10.6 of the Credit Agreement to determine what is needed.

 

 

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EXHIBIT Q
FORM OF
DECLINING LENDER NOTICE
BARCLAYS BANK PLC
200 Park Avenue
New York, New York 10166
[Name and Address of Lender]
Attention of [          ]
Telecopy No. [          ]
[Date]
Ladies and Gentlemen:
The undersigned, BARCLAYS BANK PLC, as administrative agent (in such capacity,
the “Administrative Agent”), refers to that certain Third Amended and Restated
Credit Agreement, dated as of February  _____, 2010 (as amended, supplemented or
otherwise modified from time to time, the “Credit Agreement”), among PINNACLE
ENTERTAINMENT, INC., a Delaware corporation (the “Borrower”), the several banks
and other financial institutions or entities from time to time parties to this
Agreement (the “Lenders”), BANC OF AMERICA SECURITIES LLC AND JPMORGAN
SECURITIES, INC., as Joint Lead Arrangers and Joint Book Runners, and the
Administrative Agent. Unless otherwise defined herein, terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement. The Administrative Agent hereby gives notice of an offer of
prepayment made by the Borrower pursuant to Section 2.13 of the Credit Agreement
of the prepayment amount. The portion of the prepayment amount to be allocated
to the Loan held by you and the date on which such prepayment will be made to
you (should you elect to receive such prepayment) are set forth below:

           
(A)
  Total prepayment amount      
 
         
 
         
(B)
  Portion of prepayment amount to be received by you      
 
         
 
         
(C)
  Mandatory prepayment date (5 Business Days after the date of this Declining
Lender Notice)      
 
         

IF YOU DO NOT WISH TO RECEIVE ALL OF THE PREPAYMENT AMOUNT TO BE ALLOCATED TO
YOU ON THE MANDATORY PREPAYMENT DATE INDICATED IN PARAGRAPH (C) ABOVE, please
sign this notice in the space provided below and indicate the percentage of the
prepayment amount otherwise payable WHICH YOU DO NOT WISH TO RECEIVE. Please
return this notice as so completed via telecopy to the attention of
[                    ] at [                    ], no later than 10:00 a.m., New
York City time, one business day prior to the mandatory prepayment date, at
Telecopy No. [                    ].

 

 

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IF YOU DO NOT RETURN THIS NOTICE, YOU WILL RECEIVE 100% OF THE PREPAYMENT
ALLOCATED TO YOU ON THE MANDATORY PREPAYMENT DATE.

                      BARCLAYS BANK PLC,             as Administrative Agent    
 
               
 
  By:                          
 
      Name:        
 
      Title:  
 
   
 
         
 
   

                                        , hereby DECLINES its option to receive
all of the prepayment amount.

          [Name of Lender]
 
       
By:
     
 
Name:      
 
Title: